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The reserved State powers, also called reserved powers, is a doctrine reserved exclusively for the states, that is used in the interpretation of the Constitution of Australia. It adopted a restrictive approach to the interpretation of the specific powers of the Federal Parliament in order to preserve the residual powers of the States. The doctrine of reserved powers was abandoned by the High Court in 1920 by the Amalgamated Society of Engineers v Adelaide Steamship Co Ltd.

• Reserve intrastate commerce (refers to livestock)
• Establish local governments
• Administer Elections (Most important Reserved Power)
• Establish license requirements
• Protect the public's health and welfare (police and fire departments)

The Reserved Powers Doctrine

In the first two decades of its existence, the High Court adopted a doctrine of reserved State powers" combined with "implied inter-governmental immunities". The essence of the first part of the doctrine was that grants of power to the Commonwealth in the Constitution should be read in a restrictive way so as to preserve as much autonomy as possible for the States. The essence of the second part of the doctrine was that the Commonwealth and States were immune to each other's laws, and could not mutually regulate each other's governmental apparatus: for instance, they could not tax the wages of each other's employees or force each other's employees to submit to compulsory industrial arbitration.

Doctrine Abandoned in 1920 Engineer's Case

The doctrine was swept away in the 1920 decision in the Engineer’s case (after changes in the composition of the Court). The Court now insisted on adhering only to the language of the constitutional text read as a whole in its natural sense and in light of the circumstances in which it was made: there was to be no reading in of implications by reference to the presumed intentions of the framers. In particular, since there is no mention of "reserved State powers," only one express inter-governmental immunity (regarding property taxes: section 114), and, an express provision asserting the superiority of valid Commonwealth laws over inconsistent State laws (section 109), there was no longer any room for the doctrine previously asserted in favour of the States.

The Reserved Powers Doctrine of the United States

The United States Reserved Powers Doctrine is used to void contracts ab initio (from the beginning). The doctorine states that the state government may not contract away essential attribute of its sovereignty.^[1][2]

The Reserved Powers Doctrine was Chief Justice Marshall's way of dealing with the Contract Clause to public contracts. Although the Contract Clause made it possible for state legislatures to bind their successors by entering into contracts, it became apparent that such contracts could become a threat to the sovereign responsibilities of state governments. Later courts were less willing to recognize contractual restraints upon legislative freedom of action, and two distinct limitations developed to protect state regulatory powers. One came to be known as the “reserved powers” doctrine, which held that certain substantive powers of sovereignty could not be contracted away.^[2][3]

Notes

1. ^ Cuyahoga Metropolitan Housing Authority v. U.S. 57 Fed.Cl. 751. Fed.Cl.,2003
2. ^ ^{a b} U.S. v. Winstar Corp. 518 U.S. 839, 116 S.Ct. 2432. U.S.,1996.
3. ^ West River Bridge Co. v. Dix, 6 How. 507, 12 L.Ed. 535 (1848) Holding that a State's contracts do not surrender its eminent domain power