Testing Validity Of Import Control

Manawatu Times, Volume 64, Issue 97, 27 April 1939, Page 8

Testing Validity Of Import Control

INTERESTING ARGUMENT IN SUPREME COURT Per Press Association. AUCKLAND, Last Night. The action begun on Monday to determine the validity of the import control regulations introduced last December was continued before Mr. Justice Callan in the Supreme Court. The action was a test case brought by F. E. Jackson and Company, importers and hardwaremerchants, against the Collector of Cus toms at Auckland claiming possession of certain goods plus £IOO as damages for wrongful detention. Mr. A. H. Johnstone, K.C., and Mr. Munro appeared for plaintiff. For the Collector of Customs the Solicitor-General (Mr. H. H. Cornish) appeared in person and with him Mr. V. R. Meredith and Mr. N. I. Smith. Plaintiff ordered from Sydney and endeavoured to land a line of 'kerosene pumps valued at £l4 4s, but although he had paid the dues the Collector of Customs refused to deliver the goods unless a license under the import control regulations was produced. Plaintiff contended that those regulations were without authority and voixl. Mr. Munro continued his argument, submitting authorities in support of his proposition that in the absence of express authority so to do the GovernorGeneral could not subdelegate the powers conferred upon him by section 46 of the Customs Act to any other person or body. Mr. Munro said if his argument was correct that the regulations were invalid under the Customs Act then his friends were driven to tne assertion that the Reserve Bank Amendment Act gave power to regulate the whole economic life of the community. The claim to exercise economic dictatorship over this country must rest on more definite language than that contained in section 10 of the Reserve Bank Amendment Act.

Opening liis case Mr. Cornish said the general purpose of the Reserve Bank was to give effect to the monetary policy of the Government. To enable the bank to fulfil the functions laid down for it the Governor-General might make such regulations as he considered necessary and these regulations were subsequently to be laid before Parliament. Part of the function of the bank was to put into operation exchange control and to control credit and currency in New Zealand. All the Governor-General was concerned to do was to pass measures that would enable the Reserve Bank to carry out its functions.

His Honour said it was a strong thing to have done, but I'arnament had sanctioned the control of New Zealanders transferring money out of the country or receiving it into New Zealand. He understood that, but why was it necessary in the exercise of that power to prevent an importer from buying goods? It might be very expedient if importers' good sense did not prevent them buying what they could not pay for, but how was it necessary? Mr. Cornish said that if imports were not paid for the good name of New Zealand would be affected and the Gov-ernor-General was concerned with that. Part of the monetary policy of the Government was that the people of New Zealand should not contract debts that they were not able to pay. His Honour said that as at present advised ho thought the GovernorGeneral had deemed something necessary which his Honour did not think necessary.

Mr. Cornish said the GovernorGeneral was the judge of what was necessary and the Court could not control him as to that unless he had deemed necessary something that was expressly or impliedly forbidden.

His Honour said if it was the monetary policy of the Government to keep down imports and control the London funds it seemed to him that that had been accomplished by not allowing New Zealanders to send money away. In order to accomplish that purpose it was not necessary to forbid them trying to import though it might be very expedient.

Mr. Cornish submitted that if there was no proclamation under tho export or import control regulations the Reserve Bank would have been given power to put an embargo without any guidance as to how to exercise that power. It would still have been necessary to have framed regulations making the Reserve Bank itself the licensing authority. The power to regulate the transfer of goods was necessarily implied in the power vested in the Gover-nor-General to prescribe measures that he deemed necessary to enable the Reserve Bank to rgulate and control the transfer of moneys from New Zealand. The question was: Could import control be regarded as a legitimate means of carrying out an intelligible • monetary policy consistent with the controls maintained in the Statute? If so it would be the duty of the Reserve Bank to carry out that policy. Import control was a recognised incident of exchange control. The Court adjourned until to-morrow when Mr. Cornish will continue his argument. Whisky Withdrawn From Sale TRADE RESUMES LATER AUCKLAND, April 25. An extraordinary position arose in Auckland yesterday morning when, a number of hotels withdrew whisky for sale in bars and others refused to sell whisky by the bottle, this being the result of restrictions on imports of that commodity. Hotels under other managements continued business as usual. At about noon, however, the restrictions were withdrawn and the hotel trade resumed its normal course. Many -amusing incidents occurred while the restrictions lasted, as irate customers argued with barmen and barmaids without avail.