Cosgrove Auto Parts Pty Ltd and Minister for Transport and Regional Services

[2006] AATA 31

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 31

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2005/779

GENERAL ADMINISTRATIVE  DIVISION		)
Re		COSGROVE AUTO PARTS PTY LTD

Applicant

And MINISTER FOR TRANSPORT AND REGIONAL SERVICES

Respondent

DECISION

Tribunal Senior Member, Mrs Josephine Kelly

Date17 January 2006

PlaceSydney

Decision

The decision under review is set aside and substituted for that decision, is the decision that approval to import the following vehicles is granted: 

·     Mercedes Benz 300SE

·     Isuzu Elf 1989

·     Mitsubishi Canter 1989

·     Hino Tipper 1989

·     Hino Ranger 1990

·     Isuzu Elf 1989

[sgd]  Senior Member, Mrs Josephine Kelly

CATCHWORDS

TRANSPORT – Motor Vehicles Standards – Applicant seeking to import six non-standard road vehicles manufactured in 1989 and 1990  – Minister must approve a vehicle if it was manufactured before 1989 – transitional regulation to be applied – approval may be granted if the Applicant had paid an amount in relation to the six vehicles they are seeking  to import before  7 February 2005 – deposit paid for in August 2004 – decision set aside.

LEGISLATION

Motor Vehicle Standards Act 1989 ss 20

Motor Vehicle Standards Regulations 1989 cl 9, 11,17

Motor Vehicle Standards Amendment Regulations 2005 (No. 1), cl 4

Motor Vehicle Standards Amendments Regulations 2005 (No. 3)

REASONS FOR DECISION

17 January 2006 Senior Member, Mrs Josephine Kelly     

Introduction

1.      On 19 May 2005, the Applicant, Cosgrove Auto Parts (“Cosgrove”), applied to import seven vehicles from Japan (T3). Six of the vehicles were manufactured after 1 January 1989 (“the six vehicles”) and one before that date. On 23 May 2005, a delegate of the Respondent, the Minister for Transport and Regional Services (“the Minister”) refused to grant the application to import the six vehicles. On 24 May 2005 approval was given to import one vehicle, a 1988 Toyota Dyna. 

Issue

2.      The issue before the Tribunal is whether Cosgrove paid an amount in relation to the intended importation of the six vehicles before 7 February 2005 pursuant to cl. 4(a) of the Motor Vehicle Standards Amendment Regulations 2005 (No. 1), which is a transitional provision. The issue arose because the relevant regulations were amended on 12 May 2005, a matter of days before the application was lodged, and Cosgrove seeks to rely upon the transitional provision.

Law

3. Section 20 of the Motor Vehicle Standards Act 1989, (“the Act”) provides relevantly:

Approval to import certain non-standard vehicles

(1) A person may import a non-standard road vehicle or a road vehicle that does not have an identification plate:

(a) where the vehicle is to be exported from Australia (with or without further work being done on it) without having been used in transport in Australia; or

(b) in prescribed circumstances.

(2) …

(3) Regulations for the purposes of paragraph (1)(b) or (2)(b) may provide for the importation, whether generally or in specified circumstances, of a road vehicle, or a vehicle component, as the case may be:

(a) with the written approval of the Minister; or

(b) with such approval subject to written conditions determined by the Minister.

4.      The Motor Vehicle Standards Regulations 1989, (“the Regulations”) relevantly provide:

Regulation 9

For the purposes of section 20 (1) (b) of the Act, a person may import a non-standard road vehicle or a road vehicle that does not have an identification plate if the Minister has approved an application by the person to import the vehicle.

Regulation 17

The Minister must approve an application to import a non-standard road vehicle, or a vehicle that does not have an identification plate, if the vehicle was manufactured before 1 January 1989.

5.      Regulation 17 was amended to its present form by the Motor Vehicle Standards Amendment Regulations 2005 (No. 1), (“the Amending Regulations”) which commenced on 12 May 2005.  Before the amendment, regulation 17 provided:

The Minister must approve an application to import a non-standard road vehicle or a vehicle that does not have an identification plate if the vehicle is 15 or more years old.

6.      The effect of the amendment to regulation 17 for Cosgrove in the present case was that the six vehicles manufactured after 1 January 1989 did not fall within the amended regulation, although they did fall within the regulation prior to amendment, and could have been imported.  

7.      Regulation 4 of the Amending Regulations is a transitional provision applying to regulation 17.  It provides:

Regulation 17, as in force immediately before 13 May 2005, applies if:

(a)    a person intending to import a vehicle paid an amount in relation to the intended importation of the vehicle before 7 February 2005;

(b)    the vehicle was not imported before 13 May 2005;

(c)    the vehicle was manufactured before 1 January 1991;

(d)    an application, made by the person, requesting the minister’s approval to import the vehicle is received by the Department before 1 January 2006.

8.      The Motor Vehicle Standards Amendments Regulations 2005 (No. 3) which came into effect on 8 July 2005 amended Regulation 4 of the amending regulations by adding the conjunctive “and” between paragraphs (a) to (d). The accompanying Explanatory Statement stated that the purpose of the amendment was to provide certainty. In any event, both parties accept that Cosgrove satisfied cl. 4(b), (c) and (d).  

9.      There is also a regulation conferring a discretion to approve an application, Regulation 11, which provides:

(1)   The Minister may approve an application to import a non-standard road vehicle or a road vehicle that does not have an identification plate.

(2)   An approval may be given subject to conditions specified in the instrument of approval.

(3)   Without limiting the generality of sub-regulation (2), the Minister may require that a plate in such form and containing such information as the Minister determines be placed on the vehicle.

(4)   An approval must be given by signed instrument.

Evidence

10.     The seven vehicles Cosgrove applied to import were: 

Vehicle	Year Made	Cost (¥)
Mercedes Benz 300SE	1990	345,000
Isuzu Elf	1989	360,000
Mitsubishi Canter	1989	337,000
Hino Tipper	1989	322,000
Hino Ranger	1990	741,000
Isuzu Elf	1989	457,000
Toyota Dyna	1988	627,000
Total	3,189,000

11.     After receiving notice of the decision, Cosgrove sent a letter dated 18 June 2005 (T5) addressed to “The Administrative Appeals Tribunal, Department of Transport and Regional Services” to the Department’s address. It was signed by Mr Jeffrey Reilly, a director of Cosgrove who was responsible for the application. The letter attaches an “extract from the Bank” that Mr Reilly wrote showed “our initial payment for these six vehicles of ¥1,500,000 on 27 August 2004”. The attachment is a “Telegraphic Transfer Receipt” from the Australia and New Zealand Banking Group Limited dated 27 August 2004 (“the telegraphic transfer”). It shows the “Applicant” is Cosgrove and the “Beneficiary” is “Kokubu Trading Co Ltd” (“Kokubu”). The payment details include the exchange rate of 75.7300, JPY 1,500,000, and a total cost of AUD 19,837.21 including charges. There is in evidence a receipt issued by Kokubu to Cosgrove, dated 30 August 2004 which states: “We received payment of JPY 1,500,000 – by T/T remittance on 2004/8/30 for the deposit of vehicles you ordered in July 2004” (Exhibit A1).

12.     There was also in evidence a letter dated 17 August 2005 from Kokubu to the Department (Exhibit A1) that states: 

I have been asked by Jeff of Cosgrove Auto Parts Pty Ltd to supply information relating to the purchase of six vehicles.

Jeff came to Japan in about July of 2004 to inspect trucks and cars available for purchase in Japan and export to Australia. He gave me a list of vehicles he would like me to find and prepare for export. From that list I chose six which we believed we could find for him.

13.     A list of vehicles was given, which given the other evidence before me, was relevantly the same as the six vehicles the subject of the refusal, the model years for each being specified “1988-90”.  The list of vehicles Mr Reilly had given to Kokubu was not in evidence.

14.     The letter continues:

I asked Jeff to provide us with a deposit of approximately JPY 1,600,000 – for these vehicles. As these are special type vehicles which will need some time to find and are not very common.

At the end of August 2004, Cosgrove transferred the requested deposit to Kokubu’s account so that we could source the vehicles for him. We have extracted from our records the receipt for his transfer and attached to this letter.

In late April/Early May 2005 we had finally sourced all of the requested vehicles and invoiced to Cosgrove for each of these separately. The vehicles were then ready to be shipped to Australia.

15.     I infer that the “receipt” referred to is a document in Japanese and English headed “Advice of Remittance” that shows that Cosgrove remitted JPY 1,500,000 to Kokubu on 30 August 2004 (Exhibit A1). It was not attached to the letter as tendered.

16.     Attached to the application and dated 7 May 2005 are “Proforma” invoices from Kokubu for each of the vehicles that it had sourced and for which Cosgrove sought approval (T3).

Evidence of Mr Jeffrey Reilly

17.     Mr Reilly gave the following evidence. He began importing whole vehicles from Japan to Australia approximately two years ago when he relocated his business.

18.     He had ordered the six vehicles in June or July of 2004.  Mr Reilly has been doing business with Kokubu for ten years importing parts and vehicles. He has always ordered whole vehicles through Kokubu.  

19.     He said that he normally paid Kokubu when the vehicles were loaded for shipping to Australia but for these six vehicles he was required to pay a deposit. The deposit was paid because Kokubu had asked for a contribution due to the special nature of the vehicles. The payment was to cover the cost of the extra time and effort Kokubu would have to make looking for them.

20.     When it was put to him in cross-examination that these cars were not special because he had imported the same makes and models before, Mr Reilly stated that they were special because this time there were three way tippers. Mr Reilly also stated that previously Kokubu had to only find one special vehicle but this time there were a lot of special vehicles being ordered which is why they needed the deposit.

21.     He explained that these particular six vehicles were sourced because they sold very easily in Australia, and that the “three-way tippers” were not available in this country. He ordered two three-way tippers, the Mitsubishi Canter and Hino Tipper. He said that it was very rare that they could find three-way tippers, and that he had to pay a lot more for them than previously. The Mercedes 300SE, which is a sedan, was also special because it was a new shape. It was also a very easy to sell. He had never been asked to pay a deposit before the order for these vehicles. 

22.     Mr Reilly said that it normally took about one to six months to obtain vehicles. He did agree that he had brought in a three-way tipper before and did not have to pay a deposit. He had previously paid more for a Hino Ranger than he paid for any of these vehicles.

23.     The invoices from Kokubu for the six vehicles do not show that a deposit had been paid (T3). When cross-examined about that, Mr Reilly said he was not surprised that the invoice had no details of the deposit. Miss Henderson, who appeared for the Minister, put to Mr Reilly that the reason that it was not on the invoice was because the money that he paid by telegraphic transfer did not relate specifically to these six vehicles and in fact he did not know which cars that transfer belonged too. He responded that the Minister had a copy of the telegraphic transfer and the receipt from Kokubu.

24.     Once he had paid the deposit, Mr Reilly believed that the vehicles were sourced by Kokubu, and he was sent pro-forma invoices for the six vehicles when they were obtained. When he received the pro-forma invoices, he applied to import them (T3). When the vehicles were shipped, Kokubu would make out a “normal” invoice. At the time of the hearing the balance of payment exceeding the deposit had not been paid and no other invoice had been issued. 

25.     Mr Reilly had previously imported approximately sixty vehicles, and his applications had never before been refused. He agreed that the supplementary T-Docs were all of the applications that he has made for the importation of vehicles. He has imported vehicles from January 2004 to May 2005.

26.     He was not aware of the new regulation when he obtained these vehicles. The six vehicles are currently stored at a cost, on a wharf in Japan.   

27.     Mr Reilly said that he now has a strained relationship with Kokubu. Kokubu has obtained the six vehicles on his behalf and wants them to be sent to Australia. If he does not get approval to import the vehicles, he said he will either lose the deposit or he will have to bring the cars over as parts and make a loss.

28.     Mr Reilly has used Mr Tony Larkin as his customs agent for every application for the importation of vehicles. Cosgrove completes the paper work and then the customs agent clears the vehicles from the wharf.

29.     Mr Reilly was unaware if Tony Larkin kept up to date with changes to the law in this area but presumed he would. He admitted that he did not keep up to date with the changes in this area of law and that he had never visited the Department’s website. Mr Reilly also admitted he has never consulted the Department about any changes that might occur and was not aware of any publicity regarding changes since he first began importing whole vehicles. He does not get correspondence from Canberra and he did not realise there was a problem until the application was refused.

30.     Mr Reilly also admitted that he had not asked Tony Larkin to keep him aware of any changes to the law. He just did as he always did.

31.     Mr Reilly could not recall how he was informed that the six vehicles were ready. He also said that Kokubu rang and said that the vehicle had been found but could not recall whether that occurred on seven separate occasions or whether there was just one phone call.

32.     He said that previously he had always paid Kokubu by a letter of credit and only when the vehicles were loaded onto the ship. He had never paid by telegraphic transfer for any vehicles prior to this instance. Mr Reilly is the only person who deals with money at Cosgrove. At the time of the hearing he was unaware of how much Cosgrove owed Kokubu for the six vehicles, that is whether the deposit was included in the price and whether or not Cosgrove had to pay the storage fees  He said that a letter of credit could only be paid when the vehicles were loaded onto the ship in Japan, because you have to have a bill of lading. Therefore, he had to pay the deposit by telegraphic transfer.

Evidence of Previous Importations

33.     Mr Reilly has imported 78 vehicles to Australia involving twenty two applications. The Minister sought to compare the six vehicles that he is currently seeking to import to what he has previously imported.

34.     Mr Reilly has previously imported 12 Isuzu Elfs,  three of which were 1989 Isuzu Elfs; 16 Mitsubishi Canters,  eight of which were 1989 Mitsubishi Canters; and 16 Hino Rangers, four of which were 1990 Hino Rangers. He has imported one 1988 Hino Tipper and one Fuso Tipper. He has not previously imported a Mercedes Benz 300SE.

35.     The total value of the vehicles that Cosgrove is currently seeking to import is ¥3,189,000, with the most expensive vehicle being the 1990 Hino Ranger which costs ¥741,000.

36.     Some previous occasions when Cosgrove has imported vehicles having a total value more than ¥3,189,000, and with the most expensive vehicle being worth more than ¥741,000 are:

·     29 July 2004 – total cost of vehicles ¥3,336,000; the most expensive vehicle being a Toyota Camping Bus, ¥794,000.

·     24 September 2004 – total cost of vehicles ¥3,603,000; two expensive vehicles - a 1989 Hino Ranger, ¥845,000; and an Isuzu Forward 1989, ¥900,000.

·     8 March 2005 – total cost of ¥6,054,000; the most expensive vehicle being a ¥785,000 Hino Ranger.

37.     The most expensive vehicle that he has ever imported was a 1989 Hino Ranger which cost ¥1,000,000 (19 January 2005). That is more expensive than the ¥741,000 required for the 1990 Hino Ranger the subject of the present application.

38.     The Hino Tipper the subject of the application cost ¥322,000. The previous Hino Tipper Cosgrove imported cost ¥450,000, and the Fuso Tipper cost ¥618,000. The Mitsubishi Canter the subject of this application cost ¥337,000. Previous imports of a 1989 Mitsubishi Canter have ranged in price from ¥290,000 to ¥709,000. On 29 July 2004 Cosgrove ordered 3 Mitsubishi Canters which are three-way tippers.

39.     Miss Henderson argued that Cosgrove has in the past imported vehicles with a greater net worth and for which no deposit was paid. Mr Reilly maintained that Kokubu required a deposit because of the special nature of the six vehicles, including the three way tippers.

Consideration

40.     The question for me to decide is does the telegraphic transfer of August 2004 relate specifically to the six vehicles that Cosgrove is seeking to import? If I am satisfied that it does, Cosgrove succeeds.

41.     Ms Henderson put the following argument. The Tribunal should not be convinced that the telegraphic transfer relates to the six vehicles. They are not identified in that document.  Regulation 4 of the Amending Regulations requires that the money must be specifically for those vehicles. Cosgrove could not establish when it ordered the vehicles, and the list of vehicles that Mr Reilly said he gave to Kokubu to find in 2004, was not in evidence. She argued that the earliest day that the vehicles can be identified is when the pro-forma invoices were sent on 7 May 2005. Cosgrove also had never had to pay a deposit before despite having given larger orders with more expensive vehicles and normally paid only once, which was when the ship had been loaded. The Tribunal should be suspicious that the six vehicles were “special”.

42.     I make the following findings on the evidence. Cosgrove has imported nearly 80 other vehicles. There is only one telegraphic transfer in evidence. There is no evidence that it was used to pay for anything other than the six vehicles. Mr Reilly stated that it was a deposit for the six vehicles. According to Mr Reilly, this was the only time such a payment had been requested by Kokubu. All other payments have been made by letter of credit when the cars have been loaded. There is in evidence also the receipt from Kokubu dated 30 August 2004 which states that it is a receipt for the deposit of vehicles ordered in July 2004, and the letter from Kokubu dated 17 August 2005, which supports Cosgrove’s position, including that the vehicles were “special”. That letter states that “these are special type vehicles which will need some time to find and are not very common”.  

43.     I am satisfied on the evidence that the telegraphic transfer was paid in relation to the intended importation of the six vehicles. Regulation 4(a) is satisfied.  

44. Given that finding, it is unnecessary to consider the exercise of the discretion conferred pursuant to cl. 11 of the Regulations.

Decision

45.     For the reasons set out above, I set aside the decision under review and substitute for that decision, the decision that approval to import the following vehicles is granted: 

·Mercedes Benz 300SE

·Isuzu Elf 1989

·Mitsubishi Canter 1989

·Hino Tipper 1989

·Hino Ranger 1990

·Isuzu Elf 1989

I certify that the preceding 45 paragraphs are a true copy of the reasons for the decision herein of Senior Member Mrs Josephine Kelly

Signed: Miss Sacha Keady
  Associate

Date/s of Hearing  9 December 2005
Date of Decision  17 January 2006
Solicitor for the Applicant          Thurlow Fisher Lawyers
Counsel for the Respondent     Miss R. Henderson
Solicitor for the Respondent     Phillips Fox