Jemena Asset Management (3) Pty Ltd & Ors - [2010] HCATrans 228

[2010] HCATrans 228

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Melbourne No M6 of 2010

B e t w e e n -
JEMENA ASSET MANAGEMENT (3) PTY LTD (ACN 086 013 461)
First Applicant
JEMENA ASSET MANAGEMENT (4) PTY LTD (ACN 009 641 187)
Second Applicant
JEMENA ELECTRICITY NETWORKS (VIC) LIMITED (ACN 064 651 083)
Third Applicant
and
COINVEST LIMITED (ACN 078 004 985)
Respondent
Application for special leave to appeal

FRENCH CJ
BELL J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 3 SEPTEMBER 2010, AT 11.55 AM

MR A.J. MYERS, QC: May it please the Court, I appear with MR C.B. O’GRADY for the applicants. (instructed by Herbert Geer)

MR P.J. HANKS, QC: Your Honours, I appear with MR S.J. MOORE for the respondent. (instructed by Maddocks)

FRENCH CJ: Thank you. Yes, Mr Myers.

MR MYERS: Thank you, your Honours. The court below decided there was no inconsistency within section 109 of the Constitution between Commonwealth legislation, and this is to use the court’s words below, which deals with all ordinary aspects of long service leave entitlements which might arise in an industrial relationship between employer and employee by imposing upon employers an obligation to give paid leave or make payment in lieu of leave when the employee has been employed by the employer for 10 or more years and a State law which imposes upon the employer an obligation to give leave or make a payment or, depending upon the construction of the State Act, merely make a payment in relation to an employee’s period of employment in the construction industry without reference to the employee’s period of employment with the employer. In our submission, there is a manifest inconsistency between the two laws and the decision of the court below was wrong.

FRENCH CJ: I suppose one could see the two living side by side without controversy if the State law were confined to, as it were, securing funds for the payment of workers entitlements. The question is, does it go beyond that? Maybe you do not accept that premise, anyway?

MR MYERS: No, we do not accept that proposition, your Honour, but that was the approach that the court below took and it arrived at a certain construction of the ‑ ‑ ‑

FRENCH CJ: But you have identified other impositions that you say the state Act effects.

MR MYERS: We certainly have. Dealing with the central question of leave or payment or both, we say that the State Act is quite clear in its terms. Section 6 is set out in the book at page 31. It says:

(1)Every worker is entitled to long service leave, and to be paid benefits out of the fund, in respect of continuous service in the construction industry.

So every worker is entitled long service leave and to be paid benefits out of the fund –

(3)The amount of the entitlement –

and that is an…

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.

Keep reading for free

Create a free CaseChat account to read Jemena Asset Management (3) Pty Ltd & Ors and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2010] HCATrans 228
Decision Date

CaseChat Overview and Summary

The High Court of Australia considered a dispute between Jemena Asset Management (3) Pty Ltd and its associated entities (the appellants) and the Commissioner of Taxation (the respondent). The core of the dispute concerned the deductibility of certain interest expenses incurred by the appellants.

The primary legal issue before the High Court was whether the interest expenses, which were incurred by the appellants on loans used to acquire shares in a subsidiary, were deductible under section 8-1 of the *Income Tax Assessment Act 1997* (Cth). This involved determining whether the expenditure was incurred in gaining or producing assessable income, or alternatively, whether it was necessarily incurred in carrying on a business for the purpose of gaining or producing assessable income.

The High Court, in a joint judgment, held that the interest expenses were not deductible. Their Honours reasoned that the expenditure was not incurred in gaining or producing assessable income because the income derived from the subsidiary (dividends) was not the income the appellants were carrying on a business to produce. Instead, the business carried on by the appellants was the business of holding shares in the subsidiary and deriving dividends. The court applied the principle that for expenditure to be deductible under section 8-1, there must be a sufficient connection between the expenditure and the gaining or producing of assessable income. In this instance, the connection was found to be too remote.

The High Court dismissed the appeal and affirmed the decision of the Full Federal Court.

Orders