ISSUE OF LICENCE

Evening Post, Volume CXV, Issue 74, 29 March 1933, Page 9

ISSUE OF LICENCE

FILM REGULATIONS

NOTABLE APPEAL CASE

LIVELY COMMENTS

The much-discussed Board of Trade Act came under review in the Court of Appeal yesterday when the Court was virtually asked to decide whether the Board of Trade (Cinematograph Films) Regulations made in pursuance of the wide powers given in the Act were or were not ultra vires.

The Court was considering an application for a writ of mandamus by Bobert James Kerridge, a motion picture exhibitor, of Gisborne, against Roy Maltby Girling Butcher, an inspector under the . Cinematograph - Films Act, 1928. The application had originally come before Mr. Justice Ostler, wh,o had removed it to the Court of Appeal for argument. In his ■ statement of claim the plaintiff said that he had made an application for a picture theatre licence for a theatre he proposed to build in Eotorua, but had received a notice from the defendant that- nnder the Board of Trade (Cinematograph Films), Regulations it had been decided not to issue a. licence. The plaintiff claimed that the regulations were invalid as being made without statutory or other sufficient authority, and he prayed for a ■writ of mandamus to the defendant for his application to be granted without reference ;to the regulations or any ■- direction purporting to be given thereunder, and also asked for the costs of the action.

Their Honours tho Chief Justice (Sir Myers), Mr. Justice ' Reed, Mr. Justice MaeGregoT, Mr. Justice Ostler, and Mr. Justice Smith were on the Bench. Mr. P. C. Spratt with Mr. A. E. Hurley' appeared for the plaintiff, and the Solicitor-General, .(Mr. A. Fair, K.C.) appeared on behalf .of the defendant./

In'opening, the case for the plaintiff Mr. Spratt submitted that any applicant had the right to have his application considered by the designated person, by that person alone, and under the Cinematograph Films Act only. He contended that the Board of Trade (Cinematograph Kirns) Regulations were not within the scope of section 26 of the Board of Trade Act, under which they were made, and which provided for the suppression or' prevention of ■unfair ftr prejudicial methods of competition, uneconomic trading, and monopolies. He also contended that the regulations were repugnant, to section 32 of the Cinematograph Films Act •which prescribed the method of issuing licences.

"I submit," said Mr. Spratt, "that if the defendant succeeds 'in this action^ it follows that regulations may be framed to enable the Minister 4 of Industries and Commerce to run the business of the country in any way he thinks fit."

Both the Chief Justice and Mr. Justic© Ostler suggested that there might be regulations made under which the Minister could prevent any more barristers and solicitors being admitted, or prevent air but one grocer to carry on business in a certain area.

Mr. Spratt submitted that even if the regulations went to the- length suggested, they had been so framed that they just failed to catch his client in the net. He contended that.tho plaintiff had an unqualified right to the issue of a licence.. ■ - .

ISSUING OFFICERS DISCRETION.

Mr. Justice Keecl: You-say the'issuing officer has no discretion?

Mn Spratt replied that' in his opinion the issuing officer had none at all. He must receive applications and issue licences. Just as the owner, of a dog was entitled to a dog licence, so a man had the right to a licence -under the Cinematograph Films Act, provided he complied with the conditions, if any, validly made nnder the Act. The Board of Trade Regulations, on the other hand, said that a man did not have an unqualified right. His right depended upon "the will of the Minister.

Mr. Justice Ostler: Then take away the statutory right? '

"Exactly," said .Mr. Spratt. Tho provisions of the regulations could not stand together and leave the provisions of the Statute .unimpaired. That was repugnancy... It.was not a case- of two Statutes being of equal validity. It was a case of .principal and subordinate legislation. The regulations in any case were "bad," because they were so uncertain in their operation that anyone who might be- affected by them .could not tell whether he would be so or not.

"If the regulations in their entirety can be sustained, then Parliament hf s abrogated its right and duty to legislate in Tespect of matters upon which the^ regulations operate or can operate," continued counsel.

Mr. Justice MacGregor: I don't' think that is-very astonishing to us iv New Zealand, is it? Don't we see that frequently 9• '• - y '

Mr. Spratt: Well, I could say a lot.

The Chief Justice: I-don't see that that can help you, Mr. Spratt. You have a number of good points there, but afterjall we see that happening day by day during a sitting of Parliament.

Mr. Spratt said that he felt it his duty to raise.the point, but probably it would.be better raised when other regulation's under, the Board of Trade Act were being considered. His point was that Tinder the regulations the Gover-nor-General had said: "Yon shaft not enter into trade except with the consent of my Minister," and the question might very well Taiso itself as to whether this did not mean the effacemerit of the Legislature in the matter, or the creation of another law-making

body. ' CASE POR THE REGULATIONS. Opening the case for the defendant the Solicitor-General said that tho Order in Council could not be attacked, ■because by the very terms of the section the Governor-General in Council and the Board of. Trade (or the Minister of Industries and Commerce) were made the sole judges as to its reasonableness. It appeared, therefore, that the question to be decided by the Court depended upon the construction of the terms of Section 26 of the Board of Trade Act.1 It had been held that 'a statute was to bo construed in accordance with three principles which, he ■."■ubriiitted, were directly applicable to the present case: (1) the character- of the instrument in which they were fouad; (2) tho relative situations and functions of the parties; and (3) the nature of the subject matter. His first point was that under the Board of Trade Act tho Executive Council, tho highest legislative authority after Parliament, ivas entrusted with extraordinarily wide powers involving questions of price control, unfair competition, and monopolies.

Tho Chief Justice: Do you agree that these powers go as far as Mr. Spratt suggests? That Is to say, that this section gives the Governor-General in Council the power to put out of business say. every grocer but one on every street, say, Lambton Quay, /Willis Street, and Manners Street?

Mr. Fair: No, I would not go as far as that. Tho Governor-General in Council has power to limit any fresh competition. -

Mr. Justice Bced: Would it not be possible under these powers for an, order to be made preventing the Supreme Court, until further order,, from admitting any more solicitors? Mr. Fair: Well, that would be a very

unusual action (laughter), but I should say it would be possible.

Mr.? Justice Ostler: It takes away most of the liberty we thought we had in this country. It could prevent any young man, from entering a profession in this country.

The Chief Justice asked whether, if that were so, the Court had not better use all its ingenuity to present such a state of affairs.

"^ Mr. Fair submitted that, however undesirable it might be, if the language of the Act was clear and unambiguous, as ho contended it was, it was the duty of the Court to support' the Legislature. The Act, he said, was novel and drastic, and was intended to confer very wide powers upon the Executive Coun-' I cil. Soction v 2of the Act included in its ambit every profit-making venture. Mr. Justice Maegregor (smiling): Really its short title might bo: "Moro Government in business."

Mr. Fair: No, if your Honour pleases, "more control of business in Government."

DRASTIC POWERS INTENDED,

The Solicitor-General, by quoting tho various sections of the AjCt, went on to show that tho Act gave extraordinarily wido powers, but the fact that the.powers given to the Board of Trade were now invested in the Minister of Industries and Commerce, he contended, showed that Parlamcnt was content to allow these extraordinarily wide powers to remain to be put into use at the Minister's discretion, the only limitation of power being that no regulation could be made under the Act contrary to or inconsistent with any Act of Parliament. The Act, he said; was intended to be drastic, for it envisaged some commercial dealing requiring drastic action. ■ Mr. Justice Heed: Is that a copy of the English Act, or does it come from Eussia? • •

Mr. Spratt; It was made in New Zoa> land. ' .'

Mr. Justice Ostler said that Section 26 qf the Act provided power only to attack methods of competition which may l>o unfair or against the public interest. How Gould it be said that a man building a theatre was creating unfair competition or was acting against the public interest in the present state of world economic conditions? A young doctor starting out could not be said to bo creating unfair competition or, acting against the public welfare. •

the Chief Justice observed that what was trying to bo done by the regulations -was not" to prevent unfair competition, but to create a monopoly.

ORIGIN OF REGULATIONS,

Mr. Fair said that the facts leading up to the making of the regulations' were that a big combination went to Now Plymouth proposing to build a new theatre There were already four, theatres there, run by two companies, but as there was not enough business for them the companies had come to an arrangement to pool all Teceipts and rationalise the showing of pictures. The combine was told of this state of affairs, and it then .suggested that it should also join in the pool and take half the net profits for keeping out of the field. The two companies replied that they had put £■ 75,000 into their businesses, and would fight the combine were it not for the peculiar state of the film market, which, gave large combinations with big city theatres a great advantage in tho selection of films that travelled, right through their chain of theatres. The regulations were aimed at preventing the development of the chain system of theatres throughout New Zealand to the detriment of independent owners, and Mr; Fair said his information was that a very great number of small owners had expressed their gratification and appreciation, of the protection offered by the regulationsj' ' ■ ■■■■•'..- ■■'.-'

Mr; Fair then went on to enlarge his point that the Board "of Trade Act was intended to and did give, originally the' Board of ' Trade and'later by amendment the Minister of Industries and Commerce, very wide powers for the regulation and control of industry and trade. The Cinematograph Regulations made under the Act were aimed at preventing a potential monopoly getting a footing in a new area. The Minister did not have to wait till the- evil'he feared actually existed, but" was entitled to act on the'maxim that prevention was better than cure. The regulations could prevent people entering into a certain industry, but there were other instances im New Zealand where such steps had been taken, and he instanced the licensing legislation limiting the number of hotelkecpers. At this stage the Court . adjourned until 10.30 this morning.