Commonwealth v New South Wales - [1906] HCA 16

3 CLR 807

2. To be paid immediately after sale. 5. Dugald takes a vested interest in one-sixth of the residue of the remaining three-fourths after payment of the legacies and annuity.

6. To be paid immediately after the sale, subject to provision for the payment of the annuity.

Appeal allowed. Order varied. Questions

answered as above. Costs of all parties as between solicitor and client out of the estate. Solicitor, for appellants, J. H. Maddock, Melbourne, Solicitors, for respondents, G. S. Mackay, Warrnambool; A. A. Sinclair, Melbourne.

THE COMMONWEALTH

THE STATE OF NEW SOUTH WALES Taxation of Commonwealth instrumentality by State-Powers of States - Stamp Duty

on transfer of Property-Land in State acquired by Commonwealth for Public purposes-Statute not binding on Crown-Stamp Duties Act ( (N.S. W.), (No. 27 of 1895), sec. -Real Property Act (N.S. W.), (No. 25 of 1900) - Property for Public Purposes Acquisition Act (No. 13 of 1901), sec. 3 - The Constitution,

By sec. 4, schedule 2 of the Stamp Duties Act (N.S.W.) 1898 ad valorem duty is payable on every conveyance or transfer on sale of any property; and sec. 23 of that Act provides that no unstamped instrument required by the Act to be stamped shall be registered or capable of being registered in any office.

3 CLR 808

808

HIGH COURT Held, that a memorandum of transfer of land held under the Real Property Act, (N.S.W. to the Commonwealth for Commonwealth purposes under sec. of the Property for Public Purposes Acquisition Act 1901, is not liable to stamp duty under sec. 2, sched. 4, and therefore the Commonwealth is entitled to have such instrument marked exempt by the Commissioner for the purpose of registration under the Real Property Act.

The Stamp Duties Act (N.S.W.), was not intended to impose, and did not impose, any obligation upon the Crown when it was passed, and therefore does not now impose any obligation upon the Commonwealth. Even if the Act, when passed, did affect the Crown as representing the community of New South Wales, it could not, after the establishment of the Commonwealth be construed as affecting the Crown as representing the Commonwealth.

Held further, that the transfer by the vendor was a necessary instrumentality of the Commonwealth for the acquisition of land for public purposes, and was therefore exempt from State taxation under the rule laid down in D'Emden V. Pedder, 1 C.L.R., 91, at p. 111.

Snyder v. Bettman 190 U.S., 249, and other cases in the United States of America, as to the validity of a State law imposing succession duty on federal property, distinguished.

SPECIAL CASE.

This was a special case for the opinion of the Court stated in pursuance of Order XXIX. of the Rules of the High Court. The facts as set out in the case were as follows:-

On 28th July 1904 a memorandum of transfer of a certain area of land at Paddington, Sydney, from a number of private persons and the Perpetual Trustee Company Ltd.,…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Commonwealth v New South Wales

Details

AGLC: Commonwealth v New South Wales [1906] HCA 16
Case: [1906] HCA 16
Decision Date: 3 April 1906

CaseChat Overview and Summary

The Commonwealth of Australia brought proceedings against the State of New South Wales concerning the imposition of stamp duty. The dispute arose when the State sought to levy stamp duty on the transfer of land within New South Wales that had been acquired by the Commonwealth for public purposes. The High Court of Australia was tasked with determining the validity of this imposition.

The central legal issue before the Court was whether the State of New South Wales had the power to impose stamp duty on the transfer of land acquired by the Commonwealth for public purposes, given the provisions of the Commonwealth Constitution, specifically section 51, and relevant New South Wales legislation including the Stamp Duties Act, the Real Property Act, and the Property for Public Purposes Acquisition Act.

The Court reasoned that the principle of the immunity of instrumentalities of the Crown from taxation by other Crowns, which had been established in English law, applied to the Commonwealth and its instrumentalities. It was held that the Commonwealth, as a sovereign entity, was not bound by the laws of a State unless expressly so provided. Therefore, the State of New South Wales could not impose stamp duty on the transfer of land acquired by the Commonwealth for public purposes, as this would constitute an interference with the exercise of the Commonwealth's constitutional powers. The Court applied the principle that a State cannot tax the operations of the Commonwealth.

Orders