Lucas v the Treasurer No. Scciv-02-946

LUCAS & ORS v THE TREASURER
[2003] SASC 147
Miscellaneous Appeal
Gray J
Introduction

This is an appeal against a decision of the Treasurer of South Australia. Stamp duty was assessed on two memoranda relating to the transfer of stock, plant and equipment of a family farming business. The Commissioner of State Taxation assessed the memoranda as being dutiable and imposed stamp duty. The Treasurer affirmed the Commissioner’s decision.
The Farming Operation
Angas Murray Lucas was the owner of two parcels of farming land at Yumuli in South Australia. He farmed the land in partnership with his wife Joyleen Dawn Lucas for many years. Property of the partnership between Mr and Mrs Lucas included stock, plant and equipment. They had two sons who joined the family farming enterprise. Mr Lucas and his sons Kevin Murray Lucas and Ian Edward Lucas formed a separate partnership. The property of this partnership also included stock, plant and equipment. The farming enterprise was operated through the two partnerships for some years.
Mr Lucas’s health deteriorated as he grew older and the sons took on more of the farming business. By April 2000 the sons were running the farm and Mr and Mrs Lucas had decided that they wished to retire to Murray Bridge.
The Oral Agreement
The family met in April 2000. The topic of discussion was the retirement of Mr and Mrs Lucas. They wished to be financially secure in retirement. The decision was taken that Mr and Mrs Lucas’s interests in the farming enterprise, including Mr Lucas’s interest in the real estate, should be transferred to the sons. In return the sons agreed to provide sufficient funds for Mr and Mrs Lucas to purchase a modest home at Murray Bridge and to provide a small income to supplement their pension entitlements.
Mr Lucas deposed to this arrangement in a statutory declaration:
-On the 26th day of April 2000 I agreed with my sons Ian and Kevin that I would cease farming and transfer the farming land and plant and equipment to them.
-On that date I operated two farming partnerships, one with my wife and known as AM & JD Lucas and the other with my sons Ian and Kevin and known as AM, KM & IE Lucas.
-It was agreed on or about that date that:
-all assets of the partnership of AM & JD Lucas would be transferred to the AM, KM & IE Lucas partnership (“the first agreement”)
-all assets of the AM, KM & IE Lucas partnership would be transferred to a newly created partnership of KM & IE Lucas (“the second agreement”)
-my land which was used for farming purposes by the partnerships would be transferred one parcel to my son Ian and the other to my son Kevin (“the land transfer”).
-It was agreed at that time that all of these transactions were to take place as a series of transactions.
-It was agreed that the amount payable by my sons was to be the sum of Two Hundred And Seventy Thousand Dollars ($270,000.00) which was to be secured by a mortgage over the properties to ensure an adequate income for myself and my wife.
-It was agreed that settlement on the first agreement would take place on the 1st day of May 2000 and on the second agreement on the 1st day of June 2000.
-The partnership of AM & JD Lucas ceased on the 1st day of May 2000 after the plant and equipment belonging to that partnership were transferred.
-The partnership of AM, KM & IE Lucas ceased trading on the 1st day of June 2000 when the plant and equipment were transferred.
-We agreed the purchase prices at the time of the agreement and advised our solicitor and accountant at that time and requested them to arrange for the arrangements to be documented.
-An agreement to transfer plant and equipment in both the first and second agreements were not recorded in writing at any other time.
-The purchase price was paid as part of the overall transaction and offset against other money owed by my sons to me and my wife.
Accounting Advice
Following the April 2000 meeting accounting advice was sought. The family accountant advised that the transfers of the stock, plant and equipment should take place on 1 May 2000 and 1 June 2000 in the manner described in Mr Lucas’ affidavit. The accountant advised that this procedure should be followed for taxation purposes. The family accepted this advice. It was left to the accountant to instruct a solicitor. The accountant instructed a solicitor to prepare land transfers, a mortgage securing the sons’ indebtedness to Mr and Mrs Lucas and memoranda recording the events of 1 May 2000 and 1 June 2000. The requested documents were not drafted until some time during or after July 2000. The documents were ready for signature in September 2000.
The Memoranda
A memorandum signed on 25 September 2000 recorded the events of 1 May 2000:
This agreement is made the 25 day of September 2000
Between Angus Murray Lucas and Joyleen Dawn Lucas both of Yumali, SA, 5261 of the one part
And Angas Murray Lucas, Kevin Murray Lucas & Ian Edwin Lucas trading as AM, KM & IE Lucas of Yumali, SA, 5261 of the other part.
Whereas Angas Murray Lucas and Joyleen Dawn Lucas
Who carry on the business of farmers and graziers in partnership with each other and the partnership is to cease trading.
Now it is hereby agreed as follows:
1.     On the 1st day of May 2000:
(a)     the partnership of Angas Murray Lucas and Joyleen Dawn Lucas ceased trading as farmers as graziers.
(b)     as a consequence of their ceasing to trade Angas Murray Lucas and Joyleen Dawn Lucas transferred the items of plant and equipment and livestock listed in the Schedule to this Agreement to the partnership of AM, KM & I E Lucas at the agreed market price listed in the Schedule.[1]
...
[1] The memorandum included clause 2 as follows:
The loan to Ford Credit in relation to the Ford Courier Ute is to be transferred to AM, KM & I E Lucas who shall be responsible for its repayment and indemnify Angas Murray Lucas and Joyleen Dawn Lucas in relation to the same.
It was not suggested that this clause was of any relevance to that appeal.
On the same date a memorandum dealing with the transaction of 1 June 2000 was signed:
This agreement is made the 25 day of September 2000
BetweenAngas Murray Lucas, Kevin Murray Lucas & Ian Edwin Lucas trading as AM, KM & IE Lucas of Yumali, SA, 5261 of the one part
AndKevin Murray Lucas, and Ian Edwin Lucas trading as Wilingar Trading Co of Yumali, SA, 5261 of the other part.
Whereas AM, KM and IE Lucas carry on the business of farmers and graziers in partnership with each other.
Now it is hereby agreed as follows:
1.     On the 1st day of June 2000:
(a)     the partnership of AM, KM & IE Lucas ceased trading.
(b)     the plant and equipment and stock listed in the Schedule to this agreement was transferred at the price mentioned in the Schedule to this agreement
(c)     Angus Murray Lucas and Joyleen Dawn Lucas loaned an amount of money to Kevin Murray Lucas, and Ian Edwin Lucas.
Apparently no thought was given to the provisions of section 71CC of the Stamp Duties Act 1923 (SA). This section provides for relief against stamp duty on certain transfers of farming property within a family.
Stamp Duty Assessment
All of the documents were lodged for stamping. With the exception of the mortgage, exemptions were claimed. The transfers of the real estate were exempt from duty. Duty was assessed on the mortgage. There has been no challenge to that assessment. Duty was assessed on the memoranda recording the transactions of 1 May 2000 and 1 June 2000.
On 3 October 2000 the family’s solicitor wrote to the Commissioner seeking a review of the assessment:
In relation to the transfers of plant and equipment. The agreements were intended to document the retirement of Angas and Joyleen Lucas from their farming operations and the transfer of the land and plant and equipment to their sons Kevin and Ian.
At no stage did the parties intend this to be a separate series of transactions. The land was transferred at a later date because of practical difficulties with regard to the bank in discharging the mortgage to the vendors without substitute security which was not available until now.
If you are unable to construe the documents as the one series of transactions, and therefore have them fall within the family farm exemption, we apply to withdraw the instruments two transfers of plant and equipment and will have them amended to give a clearer indication of the parties intent.
The Commissioner declined to review the assessment.
A notice of objection was then lodged with the Treasurer. On 1 June 2002 the Treasurer advised:
After receiving legal advice from the Crown Solicitor, I have considered the grounds stated in the Amended Notice of Objection and further information, which was provided in an unsigned Statutory Declaration received by RevenueSA on 7 December 2001.
The Stamp Duties Act 1923 (“the Act”) levies stamp duty upon a conveyance on sale. In section 60 of the Act:-
“conveyance” includes -
(a)every conveyance, assignment, transfer or declaration of trust and every application under the Real Property Act1886 or the Community Titles Act 1996; and
...
by which or by virtue of which or by the operation of which, whether upon registration or otherwise, or by the issue of a certificate of title in pursuance of which, any real or personal property or any estate or interest in any such property is assured to, or vested in, any person, and “to convey” has a meaning coextensive with the meaning of “conveyance”, as extended by this section:
“conveyance on sale” includes:-
(a)every conveyance, assignment, transfer or application under the Real Property Act 1886; and
...
by which or by virtue of which any real or personal property, upon the sale thereof, is legally or equitably transferred to, or vested in, the purchaser or any other person on his behalf or by his direction ...
The documents under consideration are:
.a Memorandum of Agreement dated 25 September 2000, between Mr Angas Lucas and Mrs Joyleen Lucas and AM, KM and IE Lucas (“Agreement 1”); and
.a Memorandum of Agreement dated 25 September 2000, between AM, KM and IE Lucas and Wilingar Trading Co (“Agreement 2”).
In my view, Agreement 1 and Agreement 2 constitute part of the machinery by which the property was conveyed. At the time the verbal agreement was made, the parties intended that the Agreements be recorded and, accordingly, the recording documents are liable to stamp duty (see Fleetwood-Hesketh v Commissioners of Inland Revenue [1936] 1 KB 351).
I accept your submission that Agreement 1 and Agreement 2 are not subject to the operation of Section 71E of the Act.
As the Agreements are chargeable as conveyances on sale, general exemption from all Stamp Duties 1A of Schedule 2 of the Act is not applicable.
Accordingly, I confirm the Commissioner of State Taxation’s assessment.
A notice of appeal was then lodged pursuant to section 92 of the Taxation Administration Act 1996 (SA) (“the Tax Act”).
The Appeal
The Appeal Process
Section 3 of the Stamp Duties Act provides that the Stamp Duties Act should be read in conjunction with the Tax Act. Section 2 of the Stamp Duties Act defines an assessment to be as defined in the Tax Act. The notice of objection was lodged. The Treasurer made a determination. An appeal to this court from the Treasurer’s determination lies as of right pursuant to section 92 of the Tax Act. This court is empowered to confirm or revoke the assessment, make a new assessment, make an order for payment of tax or any further order as to costs or otherwise as this court thinks fit.
The Stamp Duties Act
In Commissioner of State Revenue v Pioneer Concrete (Vic) Pty Ltd[2] Gleeson CJ and Gummow, Kirby and Hayne JJ restated certain fundamental principles concerning stamp duties legislation:
In considering the true construction of [Stamp Duties Legislation] two principles must be kept in mind. First, the statutory provisions in question in this case impose a duty on instruments, not on transactions. Secondly, liability to duty arises because the dutiable instrument transfers an estate or interest in real property, and it is by reference to the value of that which is transferred that duty is imposed.
Those two principles were applied by Mason J in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW):
‘It is a fundamental principle of the law relating to stamp duties that duty is levied on instruments, not on the underlying transactions to which they give effect ... [I]n the case of a conveyance the statutory command is that it attracts duty on the property conveyed; in the case of the declaration it attracts duty on 'the property comprised therein'. Consequently the issues are: (1) What was the property conveyed by the transfer?; and (2) What was the property comprised in the declaration? The decision on these issues hinges on the interpretation of the two instruments, that is, on the description given by them of the relevant estate or interest as applied to the facts of the case. It is a matter of ascertaining what is the property with which each instrument deals, according to its terms.
We cannot substitute for the issues prescribed by the statute a different issue having no foundation in the statutory provisions. Nor can we substitute for the property which the parties have chosen by their instruments to convey and make the subject of a declaration of trust the interest in property which in a practical sense represents the alteration in [the transferor's] position brought about by the combined operation of the two instruments.’
[2] (2002) 76 ALJR 1534
Extrinsic evidence may be used to determine the real nature of a transaction under scrutiny. In Commissioner of Stamp Duties (Qld v Hopkins[3] Latham CJ observed:
...in many cases the courts have heard extrinsic evidence in order to determine the real nature of the transaction to which the instrument relates and to ascertain the amount of duty payable... It is true that, as has often been said, the Stamp Duty Acts impose duties upon instruments and not upon transactions. It is obvious that you can stick a stamp or impress a stamp upon an instrument, but not upon a transaction. But, in order to determine whether an instrument is dutiable, it is nevertheless necessary to ascertain the legal operation of the instrument, i.e., to determine the nature of the transaction which it accomplishes. Thus, for example, if a person purported to make a conveyance or settlement of land in which he had no interest whatever, the instrument would not be dutiable as a conveyance or settlement, because it would not produce any legal effect whatever in relation to the property with which it purported to deal. ...
In the first place, I consider the instrument in itself independently of any extrinsic evidence and ask what would be the legal operation of the instrument if fully executed. The instrument recites an intention of the father to transfer certain property to the son to be held by him upon the trusts mentioned therein. It does not contain any agreement (either with the son or with the proposed beneficiaries) to settle the property, but only states an intention to do so. If the father had changed his mind and had refused or merely failed to transfer the property to the son, neither the son nor the proposed beneficiaries (who were volunteers) could have compelled him to do so. It is a common practice for an intending settlor to execute a deed containing or referring to an agreement to settle property owned by him and declaring the intended trusts thereof, the property to be transferred upon or immediately after the execution of the deed: See Davidson v Chirnside. Such a document does not itself settle any property, but, as an agreement to settle property, it would be a settlement within the meaning of the Act. The instrument now in question cannot be brought within the Act as being an agreement to settle property.
Further, the document itself does not transfer any property to any person. It does not itself affect the right or title of any person to any property. The document states that the father, described as the settlor, declares that the son shall hold the property upon certain trusts, but it does not in itself (i.e. apart from the extrinsic fact of transfer of the property) give any rights to any person in respect of the property.
[3] (1945) 71 CLR 351 at 360
In the present case the two memoranda do not on their face transfer any property. They are drawn in the past tense and refer to the events of 1 May 2000 and 1 June 2000. The memoranda do not purport to transfer any property to any person. The memoranda do not purport to affect the right or title of any person to any property.
Counsel for the Treasurer accepted this analysis but then drew attention to sections 60 and 31 of the Stamp Duties Act. It was argued that the effect of these sections was to render the memoranda dutiable. Counsel for the appellants resisted these contentions. However to understand the true nature of the memoranda it is necessary to have regard to the extrinsic evidence.
The Extrinsic Evidence
Counsel for the appellants tendered Mr Lucas’ statutory declaration. Mr Lucas was cross-examined. He was a credible witness. However, perhaps because of age and inexperience, his understanding of some of the legal processes appeared incomplete. This affected his reliability with respect to some matters. However I am satisfied that his statutory declaration correctly recounted the factual history.
Counsel for the appellant also led evidence from Peter Christopher Ryan, the solicitor engaged by the accountant to prepare the documentation. He explained that he took instruction from the accountant to prepare the separate documentation. This evidence was not challenged. The accountant was not called to give evidence.
Counsel’s Submission
Counsel for the appellants submitted that there was one agreement for the transfer of the entire family farming operations. The agreement was reached by the family orally in April 2000. Following accounting advice the decision was taken to effect the transfers of the stock, plant and equipment on 1 May 2000 and 1 June 2000. This occurred. Legal ownership in respect of stock, plant and equipment was transferred on 1 May 2000 and 1 June 2000. By 1 June 2000 the sons through their partnership were the joint owners of the stock, plant and equipment of the farming business. There were no written records made at this time. In September 2000 the conveyances of the land were executed and the legal estates in the land transferred. The mortgage was also executed and registered. The memoranda were signed in September 2000. In the circumstances it was submitted that the memoranda said to be dutiable did no more than provide a documentary trail.
Counsel for the appellants submitted that the court should have regard to the substance of the transaction. He contended that what had occurred was no more than a transfer between family members of the family farm. It was precisely the circumstance subject to exemption pursuant to section 71CC of the Stamp Duties Act.
Counsel for the Treasurer accepted that the parties entered into the transaction in good faith. It was acknowledged that this was not a case in which an oral agreement had been used to avoid of duty as contemplated by section 71E of the Stamp Duties Act. The Treasurer’s counsel accepted that had all the arrangements been recorded in the one instrument then section 71CC would have applied to exempt that instrument from duty. Counsel argued however that the memoranda did more than provide a documentary trail to a transaction that had been completed. He said that the memoranda were dutiable and were properly assessed. Counsel submitted that the memoranda were “conveyances on sale” within the meaning of section 60 or alternatively “agreements in writing” within the meaning of section 31 and therefore chargeable with stamp duty under the Stamp Duties Act. He contended that they contained the only record of the terms of the agreement and of the value of the plant, stock and equipment transferred.
Section 71 CC

The Stamp Duties Act provides for a number of exemptions. Section 71CC was inserted into the Act in 1994 and provides an exemption with respect to family farming transfers. The Minister’s second reading speech discloses that the section was formulated as part of the Government’s rural policy at the time. The section was aimed at providing financial relief to farmers to provide relief from stamp duty on instruments which exclusively transferred the family farm between specified categories of relatives when certain criteria were met. Counsel for the Treasurer accepted that the relatives in the present case were within the specified category. Had the transfer of the land the stock, plant and equipment been contained in the one instrument there would have been an exemption from stamp duty. However it was said that as the transaction was split, other provisions of the Stamp Duties Act should be considered.
Section 60
Counsel for the Treasurer submitted that the memoranda of 25 September 2000 came within the definition of “conveyance” as defined in the Stamp Duties Act and therefore attracted duty. Section 60 of the Stamp Duties Act provides:
In this Act—
"conveyance" includes—
(a)     every conveyance, assignment, transfer or declaration of trust and every application under the Real Property Act 1886 or the Community Titles Act 1996; and
(b)    every decree or order of any court, judge or commissioner; and
(c)     every other application or request of any kind; and
(d)     every other assurance or instrument of any kind,
by which or by virtue of which or by the operation of which, whether upon registration or otherwise, or by the issue of a certificate of title in pursuance of which, any real or personal property or any estate or interest in any such property is assured to, or vested in, any person, and "to convey" has a meaning coextensive with the meaning of "conveyance", as extended by this section;
"conveyance on sale" includes—
(a)     every conveyance, assignment, transfer or application under the Real Property Act 1886; and
(b)    every decree or order of any court, judge or commissioner; and
(c)     every other application or request of any kind; and
(d)     every other assurance or instrument,
by which or by virtue of which any real or personal property, upon the sale thereof, is legally or equitably transferred to, or vested in, the purchaser or any other person on his behalf or by his direction, and also includes—
(e)every application for a foreclosure order under the Real Property Act 1886; and
(f) every lease for which any consideration other than the rent reserved may be paid or agreed to be paid (but only so far as such consideration is concerned).
Counsel for the Treasurer submitted that the issue to be determined under this section was whether the memoranda were part of the machinery by which the property was conveyed and therefore chargeable with duty. He contended that the question of whether the memoranda formed part of the machinery by which the property was passed, or were a mere record of a past transaction was a question of fact. The onus was on the appellants to demonstrate that the memoranda were not part of the machinery effecting the transfers. The fact that the operative words in the memoranda were expressed in the past tense was not determinative and did not prevent the memoranda from being characterised as conveyances within the meaning of the section. Counsel argued that the fact that the parties took the trouble to prepare the memoranda and that they were the only record of what took place, indicated that the memoranda, rather than something which has gone before, were intended to be the means by which the transaction was effected. The memoranda contained important terms and conditions. The memoranda identified the specific personal property and the agreed price. This was said to be an indication that the memoranda themselves effected the transfer of the stock, plant and equipment.
As earlier observed I accept that the members of the Lucas family reached an agreement in April 2000 as to the terms of Mr and Mrs Lucas’ retirement from the family farm. I am prepared to act on the evidence of Mr Lucas as to the circumstances of the transfers and the preparation and signing of the memoranda. The transfers of stock, plant and equipment took place on 1 May 2000 and 1 June 2000 and property passed at that time. The memoranda recording the past events were apparently thought necessary to allow for the proper treatments of the transactions for Commonwealth taxation purposes.
A mere record of transfers that occurred in the past is not a “conveyance” within the meaning of section 60. The memoranda of themselves did not transfer any of the plant, equipment and stock. Mr Lucas’ evidence made it clear that his intent in having the transaction documented was to …do it the way it had to be donse.
The memoranda were not part of the machinery of the transaction. The memoranda were not dutiable as conveyances.
Section 31
Counsel for the Treasurer also submitted that the memoranda came within the expression “an agreement in writing for sale” contained in section 31 of the Stamp Duties Act which provides:
(1) Any contract or agreement in writing for the sale of any estate or interest in any property
... shall be charged with the same ad valorem duty as if it were an actual conveyance on sale of the estate or interest contracted or agreed to be sold.
(3) For the purposes of this section, a receipt for the payment, in pursuance of any contract or agreement, of any purchase money shall, in the absence of any further or other instrument being or evidencing the contract or agreement, be charged with ad valorem duty.
Section 31 has undergone a number of amendments since its initial introduction. A relatively early amendment included receipts as a specific category of agreement, subject to duty.
Counsel relied upon the remarks by Lord Hanworth MR in Fleetwood-Hesketh v Commissioners of Inland Revenue[4]:
It has been suggested that because there was an oral agreement antecedent to this document it might be put in the fire and the parties be no worse off. To my mind that will not do, because I think the parties as a part of their agreement intended that the agreement should be recorded; and by an agreement is meant the record of two minds which have become united for the purpose of the terms contained in the agreement. It seems to me that this document is one which it was the intention of the parties to bring into being, and which it was important - perhaps essential - for the father to hold a record that the terms of the oral agreement had been fulfilled by him, and to make it clear that the securities which are there mentioned were securities to be received by the son.
[4] [1936] 1 KB 351 at 358-359
Counsel for the Treasurer contended that the Fleetwood-Hesketh test had been met and that the memoranda were therefore the subject of duty as an agreement in writing and within section 31 of the Act. Mr Lucas gave evidence that it was intended from the outset that the agreement be recorded in writing. Counsel submitted that these factors were said to indicate that the memoranda were more than a mere record of a previous transfer. It was contended that the memoranda were intended from the outset and were essential to record the terms of the oral agreement by which the property was passed. He relied on evidence from Mr Lucas to the effect that he would have signed the memoranda at an earlier stage had they been prepared:
Q.Now, from the time when you first instructed your accountants in April to the time when all of these documents were executed it did, in fact, take some months didn’t it.
A.It did, yes.
Q.In fact, they were all executed on 25 September. Now you had instructed your accountants and possibly your solicitor as well.
A.I instructed them –
Q.To get cracking on it in due course or to do it straightaway.
A.To do it. I told them, I instructed them to do it, and it was up to them to do it.
Q.But you gave the instructions straightaway.
A.Yes.
Q.So as far as you were concerned the delay that occurred until 25 September was because that was just how long it took to do it.
A.Yes.
Q.So it could have happened much earlier, and, in fact, if that had been able to be done as a matter of practicality earlier that would have been fine wouldn’t it.
A. Yes, that would have been yes.
Q.In fact, if in April your accountants had said ‘I can look this up overnight. We’ll do it now. Make it all happen straightaway’ that would be fine.
A.Yes, that would have been what I wanted, yes. It would have been all right for me.
Q.It would have been all right for you.
A.Yes.
Q.The delay was because that’s how long it took your accountants to do it.
A.Yes.[5]
Counsel submitted that this evidence indicated that the memoranda were intended to effect the transfer rather than be a mere record of what had previously occurred.
[5] T21-22
Counsel for the Treasurer accepted the genuineness of the transactions and memoranda. It was accepted that there was no attempt to evade the payment of stamp duty.
As earlier observed property in the stock plant and equipment was transferred on 1 May 2000 and 1 June 2000 pursuant to the oral agreement reached in April 2000. The transactions were completed and fully executed on those respective dates. The memoranda prepared by the solicitor some time after 9 July 2000 were prepared at the accountant’s directions. Those memoranda played no part in the transfer of the property. The memoranda were not required contractual documents. Their purpose was apparently to provide a record for Commonwealth taxation purposes. The memoranda were not receipts within the meaning of section 31(3) of the Stamp Duties Act. That subsection is directed to a circumstance where a receipt forms part of the contractual arrangements.
The parties did not require a record of the agreement between themselves. There is no suggestion that the family, as parties to the transactions, required documentation. The decision of Fleetwood-Hesketh is distinguishable. In that case the later receipt was an important, if not essential record. It was intended to evidence the contract. That is not so in the present case. In any event, the definition of agreement in the legislation being considered in Fleetwood-Hesketh was in a different form to that presently under consideration.
Conclusion
This is a straightforward case. The family farming operation had been ongoing for many years. Mr and Mrs Lucas had reached the age of retirement. The sons were prepared to take over the farming operations. The family reached their agreement orally and in so far as it was possible to do so, implemented the agreement orally. The substance of the transaction fell within section 71CC of the Stamp Duties Act. It would be unjust in the circumstances of the present case to assess duty on the memoranda because of the form in which the agreement was documented. The submissions of Counsel for the Treasurer, that the memoranda were part of the machinery of the transaction is rejected. The further submission of the Treasurer that the memoranda were some form of necessary receipt is also without substance. The memoranda were not dutiable.
This appeal should be allowed and the assessments of duty set aside.
LIST OF CITATIONS AS THEY APPEAR IN THE JUDGMENT
1 The memorandum included clause 2 as follows:
The loan to Ford Credit in relation to the Ford Courier Ute is to be transferred to AM, KM & I E Lucas who shall be responsible for its repayment and indemnify Angas Murray Lucas and Joyleen Dawn Lucas in relation to the same.
It was not suggested that this clause was of any relevance to that appeal.
2 (2002) 76 ALJR 1534
3 (1945) 71 CLR 351 at 360
4 [1936] 1 KB 351 at 358-359
5 T21-22

[2003] SASC 147

26 May 2003