High Court of Australia McTiernan, Kitto, Taylor, Menzies and Windeyer JJ. YZ Finance Co Pty Ltd v Cummings [1964] HCA 12 ORDER Appeal dismissed with costs. Cur. adv. vult. The following written judgments were delivered:— 1964, Feb. 25 McTiernan J. The appellant brought an action in the Metropolitan District Court, Sydney, on a promissory note given by the respondent to the appellant for money lent and interest payable thereon. The appellant was a money-lender within the meaning of the Money-lenders and Infants Loans Act, 1941-1961 N.S.W. and the loan was subject to the provisions of Pt III of that Act. The respondent's defence to the action was that the appellant could not sue on the promissory note because of the provisions of s. 24 of the Act. The defence failed. On appeal the Full Court of the Supreme Court decided that the section provided a defence to the action [1] . 1. (1963) 80 W.N. (N.S.W.) 741. According to the express terms of the contract the respondent agreed to give the promissory note as "security" for the money lent and the interest thereon. He also gave to the appellant a bill of sale and a second mortgage pursuant to the same terms of the contract. Sub-section (2) of s. 24 includes a bill of sale and a mortgage in the list of securities which it enumerates but not a promissory note. It is clear therefore that the appellant was forbidden by sub-s. (1) of s. 24 to sue the respondent on his promise in the contract of loan to repay the principal or his promise to pay interest thereon. The right of the appellant to bring an action on the promissory note depends upon whether it is a proceeding for the enforcement of a security made or taken to secure the payment of the money lent and interest thereon. The argument for the appellant depends upon the form of sub-s. (2) of s. 24. The words of the sub-section are: "In this section "security" includes bill of sale, mortgage, lien, and charge of any real or personal property, and any assignment, conveyance, transfer or dealing with any real or personal property to secure the repayment of any loan". Lord Watson said in Dilworth v. Commissioner of Stamps [2] : "The word "include" is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used these words or phrases must be construed as comprehending, not only such things as they signify according to their natural import, but also those things which the interpretation clause declares that they shall include. But the word "include" is susceptible of another construction, which may become imperative, if the context of the Act is sufficient to show that it was not merely employed for the purpose of adding to the natural significance of the words or expressions defined. It may be equivalent to "mean and include", and in that case it may afford an exhaustive explanation of the meaning which, for the purposes of the Act, must invariably be attached to these words or expressions" [1] . I agree entirely with the way Sugerman J. applied this passage in the course of his reasoning in Batchelor & Co. Pty. Ltd. v. Websdale [2] . His Honour said, "The enumeration in sub-s. (2) adds nothing to the natural import of the word "security". Indeed all the matters enumerated are within the strictest meaning of that term and, within that meaning, the second limb of the definition is of the widest import. All the matters enumerated share the common characteristic that they relate to securities by which rights in relation to specific property of the debtor are conferred. These considerations lead to the conclusion that "include" in sub-s. (2) is equivalent to "mean and include" and that the definition therein given is intended to be exhaustive, or at least that the securities intended to be embraced all share the common characteristic of conferring rights against specific property" [3] . The word "security" in the context of sub-s. (1) could, in the absence of sub-s. (2), include a promissory note. All the transactions mentioned in sub-s. (2) are securities in themselves. None of them needs any expression of legislative intent to be a security for the purpose of sub-s. (1). The manifest object of sub-s. (2) to be gathered from its contents is to afford guidance as to what the term "security" in sub-s. (1) is intended to be confined. I think it would be contrary to the legislative intention revealed by adding sub-s. (2) to sub-s. (1) to enlarge by construction the scope of the word "security" in sub-s. (1) to bring within the operation of the latter provision a promissory note, as no such instrument falls within the enumeration of securities in sub-s. (2). In my opinion this sub-section provides "an exhaustive explanation" of the meaning of "security" for the purpose of sub-s. (1). The meaning of "security" elsewhere in the Act is not, of course, governed by sub-s. (2). 1. [1899] A.C. 99. 2. [1899] A.C., at pp. 105, 106. 3. [1963] S.R. (N.S.W.) 49; (1962) 79 W.N. 494. 4. [1963] S.R. (N.S.W.), at pp. 52, 53; (1962) 79 W.N., at pp. 496, 497. It is argued for the appellant that in any case the present action being one on a promissory note, which is collateral to the contract of loan, it is not a proceeding to which sub-s. (1) applies because, so the argument runs, the action is not a proceeding to recover any amount either of principal or interest under the contract of loan. In my view this argument is disposed of by reasoning in Stock Motor Ploughs Ltd. v. Forsyth [1] . The relevant passages are at [2] . 1. (1932) 48 C.L.R. 128. 2. (1932) 48 C.L.R., at pp. 133, 134, 135, 142. It is also argued for the appellant that if sub-s. (1) ought to be construed as omitting a promissory note from the list of securities which a money-lender is entitled by the sub-section to enforce it collides with the federal Bills of Exchange Act and is made invalid wholly or partly by s. 109 of the Constitution of the Commonwealth. An argument raising a similar question is examined in the above-mentioned decision: see [3] . I think that the reasoning found in Stock Motor Ploughs v. Forsyth [1] disposes of the attack on s. 24 founded on s. 109 of the Constitution. 1. (1932) 48 C.L.R., pp. 133, 135, 138, 139, 144, 145, 155, 156. 2. (1932) 48 C.L.R. 128. In my opinion the appeal should be dismissed. Kitto J. Judgment was given for the plaintiff in an action in a District Court brought by the payee of a promissory note against the maker of it. An appeal to the Full Court of the Supreme Court of New South Wales succeeded, and an order was made that judgment be entered for the defendant [4] . From that order the plaintiff appeals to this Court. 1. (1963) 80 W.N. (N.S.W.) 741. The ground upon which the Supreme Court reversed the decision of the District Court Judge who tried the action was that the action was barred by the provision made by s. 24 (1) of the Money-lenders and Infants Loans Act, 1941-1961 N.S.W.. The relevant facts were not in dispute. The plaintiff, being a money-lender in the sense which that expression has in the Act, lent money to the defendant at interest. The defendant gave the plaintiff, "as security for the repayment and payment of the said principal and interest" (to quote the words of a memorandum of the contract of loan), a trader's bill of sale over chattels, the promissory note sued on in the action (being a promissory note for the aggregate amount of the principal money lent and the agreed interest thereon), and a second mortgage over land under the Real Property Act, 1900 N.S.W.. The provision made by s. 24 (1) applies if any security is given or taken to secure the payment of any money lent by a money-lender or any interest thereon. The word "security" as used in the section is the subject of a provision in sub-s. (2) that it "includes" bill of sale, mortgage, lien, and charge of any real or personal property, and any assignment, conveyance, transfer or dealing with any real or personal property to secure the repayment of any loan. The condition of s. 24 (1) was therefore satisfied in this case, whether the promissory note be counted as a "security" or not, by the giving of the trader's bill of sale, and again by the giving of the second mortgage. The substantive provision which s. 24 (1) makes in such a case (so far as material) is that the money-lender shall not be entitled to institute any proceedings other than for the enforcement of the security, to recover any amount payable under the contract or any interest thereon. The Supreme Court held that the action was a proceeding to recover the amount payable under the contract and the interest thereon, and that it could not be maintained by the plaintiff because the promissory note was not, within the meaning of s. 24 (1), part of the "security" made or taken for the payment of the money lent and the interest thereon, and consequently the action was not a proceeding for the enforcement of the "security". In reaching this conclusion the Court adopted reasoning of an earlier decision of its own in the case of Batchelor & Co. Pty. Ltd. v. Websdale [1] , and in addition it rejected a submission put to it on behalf of the plaintiff which had not been raised in that case. The new submission was that by force of s. 109 of the Constitution of the Commonwealth s. 24 (1) should be held invalid for inconsistency with the provisions of the Bills of Exchange Act 1909-1958 Cth applying to promissory notes. This the learned Judges overruled on the authority of the judgments delivered in this Court in Stock Motor Ploughs Ltd. v. Forsyth [2] . The submission was renewed before us; but it is clearly covered by what was said in Stock Motor Ploughs Ltd. v. Forsyth [2] , and it may be put aside as not being sustainable consistently with established principle as to the meaning and operation of s. 109 of the Constitution. The only substantial question in the appeal is whether the promissory note was part of the "security" taken by the appellant, in the sense in which s. 24 (1) uses the word. 1. [1963] S.R. (N.S.W.) 49; (1962) 79 W.N. 494. 2. (1932) 48 C.L.R. 128. 3. (1932) 48 C.L.R. 128. Without subscribing to everything that was said in the judgment in Batchelor & Co. Pty. Ltd. v. Websdale [1] , I agree in the conclusion that sub-s. (2) of s. 24 exhaustively prescribes the ambit of the word "security" for the purposes of the section. It is expressed as a statement of what the word "security" in the section "includes". Unlike the verb "means", "includes" has no exclusive force of its own. It indicates that the whole of its object is within its subject, but not that its object is the whole of its subject. Whether its object is the whole of its subject is a question of the true construction of the entire provision in which the word appears. The well-known statement of Lord Watson in Dilworth v. Commissioner of Stamps [1] should not be taken so literally as to reduce the inquiry in a case like the present to an inquiry into the meaning of the word "includes". Strictly speaking, that word cannot be equivalent to "means and includes". But a provision in which it appears may or may not be enacted as a complete and therefore exclusive statement of what the subject expression includes. A provision which is of that character has the same effect as if "means" had been the verb instead of "includes". The question whether a particular provision is exclusive although "includes" is the only verb employed is therefore a question of the intention to be gathered from the provision as a whole. 1. [1963] S.R. (N.S.W.) 49; (1962) 79 W.N. 494. 2. [1899] A.C. 99, at pp. 105, 106. Accordingly the problem here is whether sub-s. (2) of s. 24 means that "security" includes the specified things and that that is all it includes, or means that "security" includes the specified things in addition to any others which it includes according to its natural meaning. The specified things are heterogeneous. Some of them (e.g. bill of sale) are instruments of which the essential characteristic consists in the right it gives a creditor to obtain payment of his debt out of specific property; some (e.g. charge) consist of rights to obtain payment of a debt out of specific property by means of curial or extra-curial proceedings; and some (e.g. conveyance to secure the repayment of a loan) are transactions investing the creditor with an estate or interest in specific property, in virtue of which he may deal with the property so as to obtain payment of his debt. The element common to all is the right of recourse against specific property; and it seems impossible to doubt that what the sub-section means by "the enforcement of the security", as applied to any of the specified things, is the taking of steps in virtue of that thing to obtain payment of the money lent (and interest) out of the property comprised in it. To accept this conclusion is to see at once an intelligible policy behind sub-s. (1). A money-lender is not to have both a right to get his money out of property and a right to sue on the personal obligation of the borrower to pay. He must make his choice: if he elects for the former he must be taken to forego the latter. As pursuit of that policy requires, the list of things which sub-s. (2) says that "security" includes is so widely described as to cover all possible forms of security over specific property. But unless sub-s. (2) means that that list covers the whole range of the word's inclusion for the purposes of the section, sub-s. (1) is not to be explained in the way I have mentioned: it must be explained as the product of some other policy. None is to be seen. It is true that modern usages have made "security" a word susceptible of more meanings than one. Its primary meaning is that which sub-s. (2) describes if it be intended as an exclusive definition: see Singer v. Williams [1] . In such contexts as are found in ss. 22 and 23 of this very Act: see Pacific Acceptance Corporation Ltd. v. Marine Food Products Pty. Ltd. [2] , and in some wills: see Halsbury's Laws of England 3rd ed. vol. 39, p. 1027, par. 1545, the word may have a secondary or popular meaning wide enough to comprehend a promissory note. But give it in s. 24 (1) a meaning extending beyond securities over property, a meaning wide enough to include the borrower's promissory note, and the enactment of sub-s. (1) becomes, as I have said, inexplicable on any basis of rational policy. There is no sensible purpose to be seen in forbidding a money-lender to sue on a contract of loan while allowing him to sue on a collaterally-created personal liability of the borrower and so to obtain a judgment against the borrower for the identical sum of money. It seems to me the necessary conclusion that sub-s. (2) is enacted not in order to provide a glimpse of the obvious but in order to describe the whole extent of the inclusiveness of "security" for the purpose of the section, and by so doing to perform the very necessary work of precluding the inference which otherwise might have been drawn from the fact that the word is used in a wider sense elsewhere in the Act. 1. [1921] 1 A.C. 41, at pp. 49, 57. 2. (1959) 77 W.N. (N.S.W.) 898, at p. 899. A suggestion was made in argument that ss. 3 and 52 disclose a careful course of draftsmanship in which "includes" is used where the intention is to make a non-exclusive provision as to the intended scope of an expression, and "means" is used for an exclusive provision. I do not think that a careful reading of the sections bears this out. In s. 3, provisions are made as to the words "company", "loan", and "money-lender", in which "includes" is the verb that is employed; but in each instance what follows seems to be a complete statement of the meaning of the expression. The same is true of the provision in s. 52 with respect to the expression "cash order". The draftsman does indeed appear to have exercised in each section a careful discrimination between "means" and "includes", but not because he has regarded "includes" as appropriate only for making an addition to the ordinary meaning of an expression. Using "means" where his purpose has been to impose upon an expression an artificial meaning to the exclusion of any other, he has used "includes" where his purpose has been to choose one out of two or more otherwise possible meanings by specifying the intended coverage. In my opinion the decision of the Supreme Court was correct and the appeal should be dismissed. Taylor J. I am of the opinion that Batchelor & Co. Pty. Ltd. v. Websdale [1] was rightly decided and that, as the Full Court considered, it disposed of the appellant's contention as to the meaning of s. 24 of the Money-lenders and Infants Loans Act, 1941-1961 N.S.W.. On the other points raised by the appellant I do not wish to add anything to the observations already made by McTiernan J. Accordingly I would dismiss the appeal. 1. [1963] S.R. (N.S.W.) 49; (1962) 79 W.N. 494. Menzies J. Section 24 (1) of the Money-lenders and Infants Loans Act N.S.W. confines a money-lender who has taken security for money lent to proceedings for the enforcement of that security. By s. 24 (2) it is provided that in the section "security" includes what is thereafter enumerated. The enumeration does not cover a promissory note or, indeed, any negotiable instrument. We are concerned here with proceedings instituted by a money-lender who, in addition to taking security in the shape of a bill of sale and a second mortgage, took from the borrower a promissory note upon which he subsequently sued the borrower. The plaintiff succeeded in the District Court but on appeal to the Full Court that judgment was reversed and judgment was entered for the defendant. The principal question here is whether the money-lender's action upon the promissory note was to enforce his security. If not, it was prohibited by s. 24 (1) because, in taking the bill of sale and second mortgage, the money-lender certainly took security so that, independently altogether of the promissory note, s. 24 (1) applied. There is no doubt that a promissory note given by a debtor to a creditor falls within the general conception of security. It is also clear that in some of the sections of the Act where the word "security" is used, it would comprehend a promissory note (e.g. s. 22) so it follows that in s. 24 (1) the word "security" would cover a promissory note unless the definition in sub-s. (2) excludes it. Sub-section (2) is in these terms: "In this section "security" includes bill of sale, mortgage, lien, and charge of any real or personal property, and any assignment, conveyance, transfer or dealing with any real or personal property to secure the repayment of any loan." Now the word "includes" is not in its ordinary meaning a word of exclusion. It is, moreover, apparent that in other definition sections to be found in the Act the words "means" and "includes" have been used with some discrimination to express different meanings (e.g. ss. 3 and 52). Why, then, should the word "includes" in s. 24 (2) be read as meaning either "means" or "means and includes"? The Full Court's decision that the word "includes" means "means and includes" rested upon the view that the word "includes" should not be given its ordinary meaning because in the enumeration there is not to be found anything not truly a security. Its reasoning was based upon the view that the word "includes" is a word of enlargement and that if in a particular provision it does not effect any enlargement, it cannot be given its ordinary meaning. It is, I think, true that everything enumerated is according to its true character a "security" and it is also true that sometimes in the Act the word "includes" is used as a word of enlargement (e.g. in the definition of loan in s. 3 or that of "cash order" in s. 52) but on the other hand sometimes it is not so used (e.g. in the definition of company in s. 3). It appears to me, therefore, that the word is sometimes used in the sense attributed to it by the Full Court but sometimes it is used with the recognition that the enumeration, by which it is followed, may not be exhaustive and because it was not desired to use a word of exclusion such as "means" which would make it exhaustive. The phrase "means and includes"—which I have not found anywhere in the Act—has commonly been used to convey both the idea of enlargement and exclusion, as Lord Watson puts it in Dilworth v. Commissioner of Stamps [1] in a passage cited by the Full Court. I find, however, no justification whatever of the Full Court's view that the word "includes" in s. 24 (2) is the equivalent of "means and includes", for that contradicts its own conclusion that the enumeration which follows it effects no enlargement. The alternatives, so it appears to me, are reading "includes" according to its ordinary meaning or as meaning "means". 1. [1899] A.C. 99, at pp. 105, 106. Upon the whole I have found no compelling reason for substituting for the word Parliament has chosen to use another word or phrase. As I have said, everything mentioned in s. 24 (2) is according to its own nature a security but the enumeration is not an exhaustive statement of everything that could be a security and I am loath to limit sub-s. (2) as the Full Court has done because to do so would in turn limit the protection conferred by sub-s. (1) upon borrowers from money-lenders. As I have said, it is clear that there are securities outside the enumeration in sub-s. (2) and I find no justification for modifying the language that has been used by Parliament to exclude a money-lender who takes an unenumerated security from the restrictions imposed by sub-s. (1). I am also disposed to think that the result brought about by the Full Court's decision is highly artificial for in the instant case all that the money-lender would need to do to circumvent s. 24 (1)—as was pointed out in argument—would be to negotiate the promissory note to his bank, for it is only proceedings by a money-lender to which s. 24 applies. Considering that to sue upon the promissory note is a proceeding for the enforcement of the security taken by the money-lender, I have reached the conclusion that the District Court judgment should be restored. I would therefore allow this appeal. Windeyer J. I consider that this appeal should be dismissed. I agree in what McTiernan J. has written and do not wish to add anything to it.