Esso Australia Resourses Ltd v Collector of Customs (Victoria)

[1992] FCA 57

JUDGMENT No. .l.s.?.../..-q~

IN THE FEDERAL COURT OF AUSTRALJA )

1          No. NG 2 of 91

GENERAL DIVISION

ON APPEAL FROM THE GENERAL ADMINISTRATIVE DIVISION

OF THE ADMINISTRATIVE APPEALS TRIBUNAI,

CONSTITUTBD BY HIS HONOUR, JUSTICE GRAY (PRESIDENTIAI. MEMBER)

BETWEEN:  E S S 0 A U S T R A L I A

RESOURCES LIMITED

First Applicant

BHP PETROLEUM (BASS

STRAIT) PTY LIMITED

Second Applicant

AND :	COLLECTOR OF CUSTOMS (VICTORIA)
Respondent

CORAM:	BEAIJMONT, WIGOX h O'CONNOR JJ
PLACE :	SYDNEY
DATE :	18 FEBRUARY 1992

MINUTES OF ORDER

Note :	Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

THE COURT ORDERS THAT:

1.         The appeal be dismissed.

1. The applicants pay to the respondent his costs of the appeal.

IN THE FEDERAL COURT OF AUSTRALIA	)	No. NG 2 of 91
NEW SOUTH WALES DISTRICT REGISTRY )	1
1
GENERAL DIVISION	1

ON APPEAL FROM THE GENERAL ADMINISTRATIVE DIVISION

OF THE ADMINISTRATIVE APPEALS TRIBUNAL

CONSTITUTED BY HIS HONOUR, JUSTICE GRAY (PRESIDENTIAL MEMBER)

BETWEEN:	ESSO AUSTRALIA RESOURCES LIMITED
First Applicant
BHP PETROLEUW (BASS STFtAIT) PTY LIMITED
Second Applicant
AND :	COLLECTOR OF CUSTOMS (VICTORIA)
Respondent

corn:	BEAUMONT, WILCOX & O'CONNOR JJ
PLACE :	SYDNEY
DATE :	18 FEBRUARY 1992

EXTEMPORE REASONS FOR JUDGMENT

TEE COURT: The issue raised by this appeal is one of

considerable importance to the parties. Nonetheless, we
entertain no doubt about the proper result, so it is

appropriate to dispose of the matter immediately.

We are of the opinion that the conclusion expressed

by Gray J, constituting the Administrative Appeals Tribunal,

is plainly correct, and for the reasons which his Honour gave.

In a very careful argument, counsel for the applicants have

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critically analysed his Honour's reasoning; but they have not

succeeded in causing us to doubt its correctness.

As we are prepared to adopt that reasoning, it is	l .
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not necessary for us to deal with the matter at any length.

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We simply make two general comments, out of deference to the arguments put by counsel to us.

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The first comment concerns the use of the word

"such", where lastly appearing in clause 2 of by-law 82. We agree with counsel for the applicants that this word is used generically, to refer back to "unstabilised crude petroleum

oil or naturally occurring petroleum gas". But counsel for
the applicants say that it introduces the further

qualification that the relevant oil or gas must be

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"incremental",	that is unable to be exploited with existing	1
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production facilities, or alternatively, be oil or gas which	I
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is within an	"accumulation" or pool from which there was no

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production before 17 August 1977. C

Neither "incremental" nor "accumulation" appears in

the text of the by-law and, as counsel concede, a reader would

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not gain any inkling of either of these additional	?
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qualifications simply by reading the by-law. The argument 1

that one or other of these qualifications should be imported	1 r
depends entirely on the history of the by-law. That history	I !
was summarised by Gray J. Without going to it, it is	I
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sufficient to say that it certainly does not support such a	i

major interpolation into the terms of the instrument. It
seems to us that the word "such", where lastly appearing in
clause 2, does no more than refer back to the words

"unstabilised crude petroleum oil or naturally occurring

petroleum gas " .

The applicantsc more significant point concerns the

meaning of the word "field". The evidence demonstrates that
the word has been used in a variety of conflicting ways,
sometimes within a single document. But we think that it is
clear that the drafter of the by-law intended to pick up the
technical meaning of that term, as explained for example in
the definition adopted by the American Petroleum Institute.
This was a formal document for which precision was important.
The carefully-framed API definition was used for many years
prior to 1978 in Australia, including by the Commonwealth
Department of Resources and Energy. It is true that some
reference works provide other definitions, some more helpful

than others. But all definitions have the common feature of

referring to a geographical area, that is a two-dimensional

segment of the earth's surface, defined by reference to
subterranean geological characteristics. The definition
proffered by the applicant makes the word "field" apply to a
quantity of oil or gas, a notion absent from any of the
definitions. Furthermore, the applicants' definition would
make the identification of the field depend upon commercial
and economic considerations and the existence of recovery
facilities - features which not only introduce major
complications in its application but which are absent from any
of the published definitions to which we have been referred.

The applicants submit that a purposive approach

should be taken to the construction of the by-law and that the
Court ought to have regard to the Treasurer's budget speech
and other extrinsic materials in discerning the legislative
purpose. We do not disagree with that, as a general approach;
but, like Gray J, we obtain no assistance from those materials
in relation to the meaning of "fields". In particular, the
budget speech leaves unclear the meaning of the critical words
"fields not yet in production". Contrary to the applicants'
submission, it is far from obvious that the word "fields" was

used in this description so as to include new developments in

existing fields. It is noteworthy that, earlier in the speech

and in referring to the new policy of partial oil import
parity pricing, the Treasurer referred to an allowance of an
annually increasing proportion, or six million barrels per

annum, of crude oil "from each field or new development within

fields discovered before 14 September 1975." Even if, in the	following paragraph, the word "field" was intended to include
a new development within a larger field, it does not follow that a similar extension of meaning should be applied to the use of the word "fields" in connection with liquefied petroleum gas. As Gray J remarked, at best, from the applicant's point of view, the speech is ambiguous.

Without repeating all of the additional points made

by Gray J, we agree with his conclusion, expressed in para.62
of his reasons, that the legislative intention in by-law 82
was to use the word "field" in a sense consonant with the
Lahee concept and, we think more importantly, the API and BMR
definitions. We agree also that it was not intended to give
the word a meaning which depends upon the application of

factors of an economic, commercial or technological kind.

The appeal should be dismissed with costs.

I certify that this and the preceding four (4) pages

are a true copy of the Reasons for Judgment

of the Honourable Justice Wilcox.

Associate: L

Dated :  18 ~edruar~ 1992

Counsel for the Applicants:	F H Callaway, QC and R W White
Solicitors for the Applicants:	Barker Gosling
Counsel for the Respondent:	R A Conti, QC and D M Yates

Solicitors for the Respondent:	Australian Government
Solicitor

Date(s) of hearing:  17 and 18 February 1992