62.
sufficiency of connection between a law and the relevant head of power. But it does that divorced from any consideration of the legal or practical operation of the law in question. That inverts the proper order of inquiry.
144 What is described as the "distinctive character test" builds largely upon statements made in cases where the laws in question have concerned the trading activities of trading corporations. The argument that the distinctive character test has been, or should be, adopted takes what has been said about what is distinctive of a trading corporation and treats that as indicating that the adjectives "foreign", "trading", and "financial" are the considerations on which the power turns. "Trading" and "financial" are said to refer to a corporation's activities; "foreign" refers to a corporation's status or origin. Yet it is acknowledged that the power is to make laws with respect to particular juristic persons. It is what was described in argument as "a persons power" – it is not "a power with respect to a function of government, a field of activity or a class of relationships"[1].
145 Treating the character of the corporations mentioned in s 51(xx) (as foreign, trading or financial) as the consideration on which the power turns produces awkward results. Why should the federal Parliament's power with respect to Australian corporations focus upon their activities, but the power with respect to foreign corporations focus only upon their status? More fundamentally, however, examination will reveal that the "distinctive character test" is put forward by the plaintiffs, not just as a convenient description of the result of considering the sufficiency of connection between a law and the relevant head of power, but as an additional filter through which it is said the law must pass if it is to be regarded as having a sufficient connection with s 51(xx). This is a contention that, again, necessarily invokes notions of federal balance.
146 It will be necessary to return to consideration of the plaintiffs' arguments after saying something about each of the five cases mentioned earlier.
7(a)The Banking Case
147 It will be recalled, from what has been said earlier about the Convention Debates, that the banking power (s 51(xiii)) provides explicit power to make laws with respect to the incorporation of banks. But s 51(xiii) also limits the banking power by specifying the power as being with respect to "[b]anking, other than
- ↑ New South Wales v The Commonwealth (The Incorporation Case) (1990) 169 CLR 482 at 497.
