54.
1944[1], it was the decision in Salomon's Case that encouraged the sole trader (or small group of traders) to conduct business as a limited company even where the venture was not especially risky or where no outside capital was required. Relatively recently, legislation doing away with the doctrine of ultra vires in relation to companies[2], permitting registration of single member companies[3], and doing away with certain capital requirements[4], may be seen as the continuation of development of the corporation as a vehicle for the sole trader's pursuit of commercial gain with minimum exposure to risk of personal liability. That development did not begin until Salomon's Case was decided.
123 None of these events could be foreseen by the framers. It is not possible to attribute to them some intention about how this legislative power operates in respect of these or other subsequent legal, economic, and social developments, without making some assumption to the effect that the framers intended that the legislative power granted to the federal Parliament should be limited, not only to facts and circumstances of the kind that existed at federation, but also to whatever kinds of legislative solution had then been devised to address the problems then revealed. But the plaintiffs, correctly, made no such explicit contention.
124 Rather, the plaintiffs confined their contentions about the framers' intention to the drawing of a conclusion from what was said in the Convention Debates, in Huddart Parker, and in early texts[5], that s 51(xx) was not intended by the framers to have the reach that would be necessary to support the Amending Act. Those sources do not support the conclusion asserted by the plaintiffs, namely, that s 51(xx) would support only a law with respect to the relationships between a constitutional corporation and members of the public (excluding employees and potential employees of the corporation).
- ↑ "Some Reflections on Company Law Reform", (1944) 7 Modern Law Review 54 at 54; cf at 57–58.
- ↑ Companies and Securities Legislation (Miscellaneous Amendments) Act 1985 (Cth), ss 46–49. See now Corporations Act 2001 (Cth), s 124.
- ↑ Corporations Act 2001, s 114.
- ↑ Corporations Act 2001, s 254C.
- ↑ Especially Harrison Moore's reference to the improbability of the Constitution contemplating "the revival of a medieval system of personal laws" – Harrison Moore, The Constitution of the Commonwealth of Australia, 2nd ed (1910) at 470.
