McDonald's Australia Holdings Ltd v Commissioner of State Revenue

McDonald's Australia Holdings Ltd and McDonald's System of Australia Pty Ltd, collectively referred to as the applicants, challenged the decision of the Commissioner of State Revenue of Queensland to impose stamp duty on documents related to the termination of a restaurant licensing arrangement. The applicants paid stamp duty on the deeds but later sought a review of the decision, arguing that no business was acquired, and thus, the duty was incorrectly charged.

The central legal issue was whether the deeds, specifically the Deed of Termination and the Deed of Extinguishment of Rights, constituted the acquisition of a business under the provisions of the Stamp Act 1894 (Qld). This, in turn, determined whether the applicants were correctly required to pay stamp duty. The court had to interpret the statutory language and assess the commercial realities of the transactions.

In its reasoning, the court found that the deeds did not result in the acquisition of a business as defined by the Act. The court noted that the primary purpose of the deeds was to terminate existing licenses, not to transfer ownership of a business. Consequently, the court concluded that the respondents' imposition of stamp duty was erroneous. The decision was set aside, and the applicants were ordered to be repaid the duty paid, along with interest, and the Commissioner was ordered to cover the applicants' costs.