Re Royal Soc for Prevention of Cruelty to Animals, Qld Inc

[1992] QCA 271

IN THE COURT OF APPEAL	[1992] QCA 271
SUPREME COURT OF QUEENSLAND	Appeal No. 66 of 1992
BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant)

Respondent

- and -

COMMISSIONER OF TAXATION

(Respondent)

Appellant

JUDGMENT OF FITZGERALD P.

Delivered the 27th day of August, 1992

The Commissioner of Taxation has appealed against a

declaration that the respondent, the Royal Society for the
Prevention of Cruelty to Animals Queensland Inc. ("The
Society"), is a "public benevolent institution" within the
meaning of sub-item 81(1)(c) in the First Schedule to the
Sales Tax (Exemptions and Classifications) Act 1935
(Commonwealth). This is entirely a technical question, the
answer to which does not depend simply upon whether or not

the Society makes a valuable contribution to the community.

Sub-section 5(1) of that Act exempts from sales tax

goods covered by any item or sub-item in the first column of
the First Schedule to the Act. Item 81(1) in the First

Schedule relevantly reads:

"Goods for use (whether as goods or in some other

form), and not for sale, by -

(a) a public hospital;

(b) a hospital which is carried on by a society
or association otherwise than for the purpose
of profit or gain to the individual members
of the society or association;

(c) a public benevolent institution; or

(d) a public organisation which the Commissioner
is satisfied is established and maintained
for the relief of unemployed persons."

The Society was incorporated by Letters Patent pursuant to the Religious Educational and Charitable Institutions Act (1861) (Queensland) as amended. Its objects, according to

its Constitution, are "... to prevent cruelty to animals by
enforcing, where practicable, the existing laws, by
procuring the passage of such further legislation as may be
thought expedient, by executing and sustaining an
intelligent public opinion in this regard and by doing all
things conducive and incidental (sic.) to the attainment of
the foregoing objects". Membership is open to any person.
The Society is controlled by its members but is not carried
on for their personal gain. It receives a significant grant
from the Queensland Government each year and substantial
funds from bequests and donations from the public. Its
activities include the conduct of animal refuges, the
provision of veterinary assistance for sick and injured
animals, prosecution, where necessary, in respect of cruelty
and maltreatment of animals, the formulation of policies for
animal welfare and the humane treatment to animals and
public education in respect of animal welfare issues. It was
conceded for the appellant Commissioner that the major
object of the society is to relieve the suffering and
distress of animals. It is less clear whether, as it
sometimes appeared, the Society expressly disavowed reliance
for present purposes upon any benefit to the community from
its activities. After a number of changes of position, it
ultimately seemed to seek to rely upon the moral benefit to
mankind which is produced by the prevention and
discouragement of cruelty to animals. In the end, it does
not matter. Neither the concession by the appellant nor
reliance by the Society upon the asserted benefit to the
community from its activities affects the outcome of this

proceeding.

If the promotion of its objects improves public

morality and conduct, the Society may be a public charitable
institution or public charity: see Re Inman (1965) VR 238;
Re Crantson (deceased) (1898) 1 IR 431; Re Wedgewood (1915)
1 Ch 113; and Picarda "The Law and Practice relating to
Charities", p.105. However, even if that were established,
it would not provide a basis for the declaration which the
Society seeks: cf Trustees of the Allport Bequest v. C. of
T. (1988) 88 ATC 4436, 4439.
Support for the contrary view was sought by the Society
in what was said by Lord Wilberforce, speaking for the Privy
Council, in Ashfield Municipal Council v. Joyce (1978) AC
122. In that case, a New South Wales statute exempted from
rates "(d) land which belongs to any public hospital, public
benevolent institution, or public charity ...". At p.137,

Lord Wilberforce said:

"But, as has often been said, in legislation of this
kind, conferring exemptions on particular interests,
probably with representation in parliament, overlapping
and tautology and insertion of particular words ex
majore cautela, are only to be expected and are indeed
unavoidable. ... . In the present case, if it may be
true that some of the specific and restricted
exemptions in favour of educational or religious bodies
would be covered by `public charity' in its legal
sense, it is also hard to resist the conclusion that
`public charity' in its popular sense would be almost,
if not wholly, contained in the adjoining expression
`public benevolent institution'. That expression, as
later construed by the High Court, means an institution
organised for the relief of poverty, sickness,
destitution or helplessness: see Perpetual Trustee Co.
Ltd. v. Federal Commissioner of Taxation (1931) 45 CLR
224, which seems to leave the minimum of room for
`public charity' in any of the suggested popular
meanings."

On analysis, there is nothing in this passage which

benefits the Society. Whether or not the popular meaning of
`public charity' coincides with the legal meaning of the
expression "public benevolent institution" is not the issue
in these proceedings. There is nothing in the passage
quoted which would warrant a conclusion that an organisation
which is in the legal sense, a "public charitable
institution" or "public charity" is also in the legal sense
a "public benevolent institution". On the contrary, the
concluding sentence in the extract taken from the judgment
of Lord Wilberforce emphasises that whether or not an
organisation is a "public benevolent institution" is to be
determined by the test laid down by the High Court in the
Perpetual Trustee case. See also Lemm v. FCT (1942) 66 CLR
339, 411; Public Trustee (N.S.W.) v. FCT (1934) 51 CLR 75,
99-100, 103-104, 106; cf Marriage Guidance Council of
Australia v. Commissioner of Payroll Tax (Vic.) (1990) 90
ATC 4470; Commissioner of Payroll Tax (Vic.) v. Cairnmiller
Institute (1992) 92 ATC 4307.

The reference by the Privy Council in Ashfield

Municipal Council v. Joyce to "an institution organised for
the relief of poverty, sickness, destitution or
helplessness" is derived from the judgment of Starke J. in
the Perpetual Trustee case at p.232. Three of the four
judges who decided that matter held that the Royal Naval
House, Sydney, was not a public benevolent institution. The
other members of the majority, Dixon and Evatt JJ., did not

put the matter in precisely the same way as Starke J.

At pp.233-234, Dixon J. said:

"... I am unable to place upon the expression `public
benevolent institution' ... a meaning wide enough to
include organisations which do not promote the relief

of poverty, suffering, distress or misfortune".

At p.235-236, Evatt J. said:

"Such bodies vary greatly in scope and character. But
they have one thing in common: they give relief freely
to those who are in need of it and who are unable to
care for themselves.

Those who receive aid or comfort in this way are the poor, the sick, the aged and the young. Their disability or distress arouses pity, and the institutions are designed to give them protection."

The remaining member of the court, McTeirnan J., said at p.241:

"While I do not think that the Legislature intended
strictly to confine the exemption to gifts to an
institution of a strictly eleemosynary character, yet
it may be difficult to bring within the scope of the
exemption which has been granted in aid of a public
benevolent institution, a gift to an institution which
is of a public character, but does not exist for the
relief of distress of misfortune occasioned by
poverty."
Much more recently, in Australia Council of Social

Service Inc. v. Commissioner of Pay-Roll Tax (1985) 1 NSWLR
567, the New South Wales Court of Appeal held that the

Council was not a public benevolent institution.

Priestley JA., with whom Mahoney JA agreed, said at

p.575:

"Rath J. thought that the High Court's conclusion in the Perpetual Trustee Co. Ltd. case was based on the proposition that an institution claiming the character

of a public benevolent institution must itself dispense
relief to the needy. He then said, assuming in the
Association's favour without deciding, that it had been
organized to promote the relief of the relevant
misfortunes, it nevertheless did not itself directly
provide such relief but rather sought to promote the
provision of such relief by its activities in the
community generally which included a seeking of
wellbeing not only for the poor but also for others
that would not be objects of the bounty of a public

benevolent institution.

When the appeal came to be argued before us, counsel
for the appellants recognized as a difficulty in their
way that the Association had not administered aid in a
direct and immediate sense but in an indirect sense as
a promoting body. This difficulty was sought to be met
by the submission that what was said and decided in the
Perpetual Trustee case should not be mechanically
applied to exclude the Association from the exemption
in the present case. Stress was laid on the submission
that the content of the words "public benevolent
institutions" had expanded since 1931. It was said
that at the time the Perpetual Trustee case was
decided popular ideas of benevolence revolved around
the concept of direct provision of aid for the
unemployed and the needy and that the High Court had
not had to consider the less direct activities of a
body such as the Association which were nevertheless
either wholly or primarily directed to the ultimate

reduction of distress of the relevant kinds.

It seems to me that there might well be some force in
this submission as to the proper application of the
Perpetual Trustee case but even if that is so, on the
facts of this case, it does not assist the appellants.
To me, the word "benevolent" in the composite phrase
"public benevolent institution" carries with it the
idea of benevolence exercised towards persons in need
of benevolence, however manifested. Benevolence in this
sense seems to me to be quite a different concept from
benevolence exercised at large and for the benefit of
the community as a whole even if such benevolence
results in relief of or reduction in poverty and
distress. Thus it seems to me that "public benevolent
institution" includes an institution which in a public
way conducts itself benevolently towards those who are
recognisably in need of benevolence but excludes an
institution, which although concerned, in an abstract
sense, with the relief of poverty and distress,
manifests that concern by promotion of social welfare
in the community generally. On this approach, even if
the appellants' submission that public benevolent
institutions are not limited to those who give direct
relief to poverty and distress is correct, a matter
now unnecessary to be decided, the Association could
not, in my opinion, be brought within even the wider
conception of the words."

Street CJ., who agreed in the result, said at pp.568-569:

"The phrase "public benevolent institution" is not
circumscribed by any statutory definition; nor is it a
term of art: Public Trustee of New South Wales v.
Federal Commissioner of Taxation (1934) 51 CLR 75 at
100. Its import has been illuminated by authoritative
decisions. Whilst its meaning is thus not absolutely
incapable of extension or modification, the pursuit of
certainty in the operation of statutes and dispositive
instruments such as wills and settlements is a powerful
factor to be taken into account when it is sought, as
it is in the present appeal, to widen the established
scope of those words. The fact is that those words do
have an established scope, one of the elements of which
involves the ascertainment of the identity of the
persons to benefit from the benevolence of the
institution in question. This tends naturally to imply
that there will be direct beneficiaries of such
benevolence. In O'Connell v. City of Greater Newcastle
Council (1941) SR (NSW) 190 at 193; 58 WN 166 at 168,
Jordan CJ quoted with approval a passage in an earlier
judgment of Campbell J. (O'Farrell v. Bathurst
Municipal Council (1923) 40 WN (NSW) 78 at 80) in

relation to the phrase "public benevolent institution":

"... I am of opinion that the question as to
whether a benevolent institution is public in the
sense in which that word is to be read in the
exempting provisions referred to is less dependent
upon the particular circumstances of its
constitution and domestic government than upon the
character and objects of its benevolence. What
are the benefits extended, which the institution
dispenses, and to whom are the benefits extended,
are enquires the answer to which must be decisive
on the question of whether or not the institution
in question is public in the statutory sense.:

It is, of course, to be recognized that, both in the
factual context in which these words were written by
Campbell J., as well as in the factual context before
the High Court in Perpetual Trustee Co. Ltd. v.
Commissioner of Taxation, the institution in question
did not itself directly dispense benefits. So far as I
am aware, in every reported case but one this element
of direct dispensation of benefits is to be found
within the factual context. This, of course, does not
necessarily and of itself predicate that direct
dispensation of benefits is a prerequisite. It does,
however, provide a strongly persuasive basis for
holding that, over the passage of years, this element
has now become built into the concept of a public
benevolent institution. The judges of the past have
taken this for granted and it is a long step to hold
that a comparatively modern statute (Pay-Roll Tax Act
was passed in 1971) can properly be construed as being

freed from that basic factual element.

...

The matter is not one in which laws or approaches previously laid down require to be moulded to accommodate modern social conditions and expectations.

The phrase has, over the decades, been applied to

countless property transactions in a context which has
involved recognition of the need for the presence of
the basic element of direct distribution or
dispensation of aid. If the tacit assumption that this
is an essential prerequisite is to be changed, it is in
my view the province of either the legislature or the
High Court, which has itself more than once been party
to that tacit assumption, to prescribe and authorise

the change.

For the foregoing reason I am of the view that the
comparatively simple test that has thus far been
recognised, although not expressly laid down, should
not be regarded as able to be extended. In other
respects, however, I am in full agreement with the
reasoning developed in Priestley JA's judgment and I
concur with his conclusion that the appeal should be
dismissed with costs."

For the reasons given by Street CJ., this Court should

accept the meaning of the expression "public benevolent
institution" which has been adopted for many years,
irrespective of whether or not a wider approach might be
appropriate if the question now fell for consideration for
the first time. The present approach derives from decisions
of the High Court of Australia, and it should be left to
that Court to formulate a new test if one is to be adopted.

Indeed, both parties accepted that the meaning of the expression for present purposes is to be determined by reference to the decisions concerning the interpretation of various other Acts in which it has been used.

The Society submitted that, if the judgments in the

Perpetual Trustee case establish the character of the benefits which are required to be provided or promoted by an organisation before it can properly be described as a public benevolent institution, the requirement is satisfied by its activities in the relief of the suffering of animals. Further, while it was acknowledged that a benevolent institution must be public in the relevant sense, it was submitted that this requirement was met by the Society's public membership and control, its dependence upon public funding, its performance of public functions, for example, under the Animals Protection Act 1925 (Queensland), and by the circumstance that the benefits provided by it, or available through it, are provided or available to animals generally.

The authorities do not support such an approach.

Whether or not an institution is accurately described as a public institution because it performs public functions and is publicly controlled and funded or is correctly described as a benevolent institution because of the nature of the benefits it provides, an institution is not a public benevolent institution unless benefits of the requisite character are provided or available to the general public or a sufficient section of the public. An institution, whether or not a public institution, must provide or promote public benevolence if it is to meet the description "public benevolent institution"; that is to say, it must provide or promote benefits of the character specified in the Perpetual Trustee case to the public or a sufficient section of the public. Such a view is supported not only by Australian Council of Social Service Inc. v. Commissioner of Pay-Roll Tax and the cases referred to but also by Maughan v. The Federal Commission of Taxation (1942) 66 CLR 388.

In Maughan, Rich and McTiernan JJ. agreed with Williams

J. who said, at p.397, that the question whether an
institution is subject to some form of public control is a
factor to be taken into account in determining whether it is
a public institution, but that public control is not
essential and the main criterion is the extensiveness of the
class it is the object of the institution to benefit. In the
context, the "class" referred to can only be a section of
the public. Support for this conclusion is provided by his
Honour's statement at p.398 that it is established by many
decisions "... that an institution which aims at benefiting
an appreciable and particularly but not necessarily an
appreciable needy section of the community is a public
institution. To sum up, the sources of the Association's
finances are public benevolence, it is controlled by an
executive elected upon a quasi-public basis, and its
activities, which accord with and fulfil the main objects of
the memorandum of association, are of a public benevolent
nature." (Emphasis added).

While it is correct to say that the various factors

referred to by Williams J. were relied upon compendiously
for the decision that the Association in that case, the
Boys' Brigade Inc., was a public benevolent institution, it
is quite impossible to read what was said as indicating
either that the other factors would have been sufficient
even if the institution's objects were not directed at
benefiting a sufficient section of the community or that
that would have been insufficient unless the Association was
financed from public benevolence and controlled by an
executive elected upon a quasi public basis.

Further, confirmation for this view is provided by the reference by Williams J. at pp.397 and 398 to what had been said by the Court in The Little Company of Mary (SA)

Incorporated v. The Commonwealth (1942) 66 CLR 368,

especially the dissenting judgment of Rich J. in that case.

At p.381, his Honour said that, although not

conclusive, it was not immaterial that the hospital was
first established partly by public subscriptions and later

partly subsidised by gifts, legacies, and donations from
members of the public. At p.383, he said that public control
was not an essential element in the definition of public
hospital, and a little further down the page, he cited with
approval what was said by Jordan CJ in O'Connell v.
Newcastle Municipal Council (1941) 41 SR (NSW) 190 at p.193:

"I can see nothing in the phrase `public hospital' nor in its immediate or general context to suggest that it is confined to hospitals which are subject to some form

of public control (whatever is to be understood by this
expression) and whose income and property are not at
the disposal of any private authority. On the contrary,
it is the purposes to which the hospital is directed,
not the manner in which it is controlled, which
determines whether it should be regarded as a public
hospital".

In The Little Company of Mary (SA) Incorporated v. The

Commonwealth, Rich J. then continued at pp.383-384:

"The terms and circumstances in which sick relief is
given are material conditions. Public service is the
discrimen - and publicity may be gauged by the
extensiveness of an institution's operations ... . The
admitted facts show that the hospital, having regard to
its objects and operations is carried on for the
benefit of the community on an appreciably important
class of the community ... and `not for private gain
but for the public good' ... . "

There are statements that "public benevolent

institution' is a compound expression: see, for example,
Public Trustee (NSW) v. Federal Commissioner of Taxation
(1934) 51 CLR 75, 103 and Metropolitan Fire Brigade Board v.
Commission of Taxation (1990) 27 FCR 279, 281. Nonetheless,
it is possible to illustrate the gap in the society's case
by pointing out that, although it may be a public
institution in the sense that there is benefit to the
community in its activities, and although it may be a
benevolent institution in the sense that it provides
benefits of the requisite character, it provides those
benefits to animals, not to the community or a section of
the community. Accordingly, it is not a "public benevolent
institution" within the received meaning of that expression.

For these reasons, the appeal should be allowed, the

orders below set aside and the proceedings dismissed. The Commissioner does not seek an order for costs either below or in this Court.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND	Appeal No. 66 of 1992
BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant)

Respondent

- and -

COMMISSIONER OF TAXATION

(Respondent)

Appellant

The President
Mr Justice Pincus

Mr Justice Thomas

Separate reasons of the President, Pincus JA
and Thomas J. delivered the 27th day of
August, 1992, all concurring as to orders
proposed except with respect to dismissal of
proceedings; Pincus JA. dissenting on that

point.

APPEAL ALLOWED.
ORDERS BELOW SET ASIDE.
PROCEEDINGS DISMISSED.
NO ORDER AS TO COSTS ON APPEAL OR BELOW.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND	Appeal No. 66 of 1992
Before the Court of Appeal

Fitzgerald P
Pincus JA

Thomas J.

BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant)

Respondent

- and -

COMMISSIONER OF TAXATION

(Respondent)

Appellant

JUDGMENT OF FITZGERALD P.

Delivered the 27th day of August, 1992

MINUTE OF ORDER:	Appeal allowed. Orders below set aside. Proceedings dismissed. No order as to costs on appeal or below.
CATCHWORDS:	Sales tax. Exemption and classifications. Appeal from declaration that respondent a "public benevolent institution" - whether not a public benevolent institution as provides benefits to animals and not to the community or a section thereof - whether legal meaning of "charitable" differs from ordinary meaning.
Counsel:	Mr H.G. Fryberg Q.C., with him Mr P. Bickford for the Appellant
Mr R.W. Gotterson Q.C., with him Mrs P. Wolfe for the Respondent
Solicitors:	Australian Government Solicitor's office for the Appellant
Messrs. Stephens and Tozer for the Respondent
Hearing Date:	30/07/92

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 66 of 1992

BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF

CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant) Respondent

AND:

COMMISSIONER OF TAXATION

(Respondent) Appellant

JUDGMENT - PINCUS J.A.

Delivered the Twenty-seventh day of August 1992

This is an appeal from a judgment given, in unusual

circumstances, in an application for declaratory relief.
The Court declared that the applicant Society, now the
respondent, is a "public benevolent institution" within the
meaning of a certain statutory provision which is set out in
the reasons of the President. The notice of appeal
asserted, amongst other things, that there was a breach of
the rules of natural justice in that the primary judge had
been told that the Society "would not be relying on benefit
to human beings flowing indirectly from the respondent's
activities to characterise the respondent as a Public
Benevolent Institution ...". The notice went on to say that
in reliance on that, the Commissioner did not apply for
discovery or lead or seek the opportunity to lead evidence
and did not argue that the case fell outside O.64 rr.1B and
1BB of the Rules of the Supreme Court. An affidavit filed
by the Commissioner for the purposes of the appeal says that
his counsel told the primary judge that the Commissioner
"would not be calling any evidence because the Royal Society
for the Prevention of Cruelty to Animals Queensland Inc. was
not arguing that there was any indirect benefit to the
public arising out of their activities". The affidavit
says, in effect, that the Commissioner would have challenged
an assertion that such a benefit existed.

The case was decided below, as clearly appears from the learned primary judge's reasons, on the basis that the Society's activities benefited human beings. His Honour described the Society as a body whose object is to "promote morality and check man's innate tendency to cruelty", quoting Picarde's "The Law and Practice Relating to Charities" p.105.

The assumption on which the appeal is based is that not only the Society but also the primary judge was bound by the statement that the Society was not arguing that there was any indirect benefit to the public. As a matter of jurisdiction, the judge was entitled to decide the case as he did, reaching what his Honour regarded as the correct conclusion, albeit by a path which he had been asked not to take. The difficulty is that it is, at least implicitly, conceded that the Commissioner conducted the case below on the assumption that it was agreed that any benefit to humans appearing from the evidence placed before the Court was to be disregarded and that he would have conducted the case differently if he had appreciated that it was open to the judge to take benefit to humans into account.

It does not appear to be necessary, for present purposes, to set out in detail the facts which were before the primary judge. The Society, it appears, engages in those activities which are perhaps familiar to the community: attempting to suppress cruelty to animals, trying to educate children to treat animals properly, looking after mistreated and abandoned animals and so forth.

I must confess it is unclear to me in what respects the Commissioner asserted that the facts might have required further investigation. One might have expected that there could not be any serious dispute, of the kind requiring a trial, with respect to the scope and nature of the Society's activities. I also find hard to comprehend how the judge could properly have decided the case, as the Commissioner suggests he was obliged to do, on the basis of an assumption that it was not arguable that there was any benefit to the public arising from the Society's activities.

As a matter of common sense, it seems evident enough that a Society of this kind can benefit human beings. The notion that people may not be harmed by carrying out or witnessing cruelty to animals, of whatever grossness, is an eccentric one. No doubt, as counsel for the Commissioner contended, it would be possible to obtain more detail as to the Society's activities by discovery and a substantial trial, but unless the Annual Reports included in the evidence are spurious, it seems plain that the Society has as a purpose, if not the purpose, of its existence that which its name indicates.

The question is whether this Court should accept an invitation of a kind which the primary judge appears to have declined, to decide the case on a restricted basis or assumption, namely that any benefit to humankind arising from the Society's activities is irrelevant to its characterisation as a public benevolent institution.

Ordinarily, in my opinion, the Court would in the exercise of its discretion to grant or refuse declaratory relief accept and act on the parties' agreement as to a factual point, as long as the agreed-on fact was not plainly wrong. Here, there is, as I have explained, no admission by the Society that its activities are incapable of benefiting the human community; it merely declines to argue that such benefit has any relevance to the question before the Court.

If a declaration were granted, it should, I think, embody in its wording the restriction agreed upon; otherwise it might have a misleading tendency.

It is my opinion that the Court should not, in the exercise of its discretion, entertain the question whether such a restricted declaration should be granted. One reason for this view is that it appears that the parties' agreement was made to avoid the cost of a substantial investigation of the facts upon which the Commissioner would otherwise have insisted - not because the Society, in truth, necessarily regards the effect of its activities on humankind as being irrelevant. The correspondence in the record shows that in correspondence before the proceedings were begun, RSPCA Australia Inc., which is presumably the respondent's parent body, plainly asserted that the statutory description was fulfilled on the ground of benefit to the public. The Commissioner responded by saying that the benefit the public receives is "only very indirect". It would be artificial to decide the case on the basis of a view that benefit to the public has nothing to do with it.

It should be added that since I wrote what appears above, the appellants have filed a written submission which plainly relies on benefit to human beings as relevant to the case.

While I sympathise with the course the primary judge took, in attempting to reach what his Honour regarded as a correct answer to the problem before the Court, it now appears clear that what the parties really intended was that the judge should, by agreement, consider the matter subject to such a restriction as I have discussed. It is my opinion that the Court should have declined to do so and that this Court should not do so.

I have read the reasons of Fitzgerald P. and Thomas J. and noted their Honours' views. It appears to me still to be an open question whether a benefit to the public other than relief of human distress - such as improving infants' education, providing a public garden, or the respondent's activities - can justify use in relation to an institution of the epithets "public benevolent". In my respectful opinion, the Court should not enter upon examination of that question on the basis that it may not reason towards a conclusion taking into account the benefits to society from the respondent's work.

I would allow the appeal, set aside the orders of the learned primary judge and make no order for costs here or below. I would invite the parties to make a further submission on the question whether the application made by originating summons should be kept alive, in the hope that a spirit of reasonable co-operation would put an end to the supposed dispute about the facts, to obtain a proper and expeditious decision.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 66 of 1992

Before the Court of Appeal
The President
Mr. Justice Pincus

Mr. Justice Thomas

BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF

CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant) Respondent

AND:

COMMISSIONER OF TAXATION

(Respondent) Appellant

JUDGMENT - PINCUS J.A.

Delivered the Twenty-seventh day of August 1992

MINUTE OF ORDER: 

1. The appeal is allowed.

2.	The orders of the learned primary judge are set aside.
3.	There is no order as to costs here or below.
4.	The parties are invited to make a further submission on the question whether the application made by originating summons should be kept alive.

CATCHWORDS:

Counsel: 

H.G. Fryberg Q.C., with him, Mr. P.
Bickford, for the Appellant
R.W. Gotterson Q.C., with him Mrs. P.
Wolfe, for the Respondent

Solicitors: 

Australian Government Solicitor's Office
for the Appellant
Messrs Stephens and Tozer for the
Respondent

Hearing Date(s): 

30 July 1992

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 66 of 1992

BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant)

Respondent

- and-

COMMISSIONER OF TAXATION

(Respondent)

Appellant

REASONS FOR JUDGMENT - THOMAS J.

Delivered the 27th day of August, 1992

In 1931 when the meaning of the phrase "public benevolent institution" came to be construed by the High Court, a wide or a narrow view was open. The Court could have determined, in line with dictionary meanings, that the phrase included institutions that existed for the promotion of the public good. The Court did not do so. It opted for a narrow view, particularly of the "benevolent" component of the phrase. Dixon J. held that an institution could not qualify unless it promoted "the relief of poverty, suffering, distress or misfortune". Starke J. required the promotion of "the relief of poverty, sickness, destitution, or helplessness". Evatt J. placed even more emphasis upon the need for relief of poverty, distress and human states that excite compassion. (Perpetual Trustee Co. Ltd. v. Federal Commission of Taxation 1931 45 C.L.R. 224, 232, 234, 236).

Prior to 1928, estate duty legislation had granted exemptions in favour of gifts "for religious, scientific, charitable or public educational purposes". It seems that at that time the popular conception of the word "charitable" was thought to be limited to activities for the relief of the needy or underprivileged. But whatever the popular view may then have been, the Privy Council in Chesterman v. Federal Commissioner of Taxation 1926 A.C. 128 determined that the legal meaning of the word "charitable" was far wider than its perceived popular meaning. It was to be taken to include activity for the relief of poverty, and the advancement of education, religion or other purposes beneficial to the community. Following that decision, federal parliament amended the Estate Duty Assessment Act to delete reference to charitable purposes. It confined exemption to more limited purposes, and included two particular types of institution to which gifts would be exempt, namely public hospitals and public benevolent institutions. The first authoritative decision on the relevant phrase was the Perpetual Trustee case above.

A succession of cases, many of which are referred to in the reasons of Fitzgerald P., adopted and applied the tests stated in the Perpetual Trustee case. In some of them there is a greater emphasis on one or more aspects of the composite phrase, but the limitations of the Perpetual Trustee approach have been fairly rigidly followed. The present legislation (the Sales Tax (Exemptions and Classifications) Act 1935) made use of the phrase "public benevolent institution" which had already been judicially defined, and it is reasonable to think that this was done deliberately.

If the matter were now one of first instance, the Courts might well adopt what they consider to be the contemporary common understanding of the words in the community. It is certainly arguable that the respondent Society is a "public benevolent institution" and a "public charity" in the popular sense of those words, and that in the popular sense there is little or no distinction between them. This in the end, seems to be the basis upon which the learned chamber Judge decided the matter in favour of the Society. However in my view the matter is no longer at large. I agree with Street C.J. in Australia Council of Social Service Inc. v. Commissioner of Payroll Tax 1985 1 N.S.W.L.R. 567, 569, that the pursuit of certainty in the operation of Statutes makes it difficult to take a new approach at this stage. I also agree with Fitzgerald P. that it is not to the point to consider the present popular meaning of "public charity", or the legal meaning of "public charity" or the present popular meaning of "public benevolent institution". Given the history of the legal decisions and legislation, we are concerned with a well established albeit limited legal meaning of "public benevolent institution".

The decisions since the Perpetual Trustee case have not been entirely static. In particular, it has been suggested that Maughan v. Federal Commissioner of Taxation 1942 66 C.L.R. 388 shows a softening of attitude to the means by which the "benevolent" component may be satisfied (cf. Commissioner of Taxation v. Launceston Legacy 1987 15 F.C.R. 527, 541 per Northrop J.). However on analysis, Maughan's case was concerned almost exclusively with the problem whether the Boy's Brigade was a "public institution" and in particular with surmounting the problems inherent in the then recent decision of The Little Company of Mary (South Australia) Incorporated v. The Commonwealth 1942 66 C.L.R. 368. There is no doubt that the primary activity of the Brigade was eleemosynary and in relief of underprivileged boys. A wider view, perhaps on the basis of a developing "ordinary meaning" of the term and its perceived similarity to "public charity" may be implicit in Metropolitan Fire Brigades Board v. Commissioner of Taxation (1990) 27 F.C.R. 279. Such an approach has much to commend it, especially when it is remembered that in the Perpetual Trustee's case Starke J. considered he was adopting the common use of the phrase, and Dixon J. conceded that in construing such terms one must often be guided "to a great degree" by one's own experience in the use of terms. However the Metropolitan Fire Brigade Board case did not seek to escape the essential limitations of the Perpetual Trustee decision. It may well be that at this stage only the High Court could safely make such a leap.

Because the cases have basically confined the exemption to eleemosynary activities, it is not surprising that the reported cases make no mention of animals or of potential beneficiaries other than human beings. The submission on behalf of the Society (which I understand to have been its principal submission in the original proceedings), and which it sought to maintain on appeal, is that "public benevolent institution" includes an institution concerned with the relief of suffering animals, and that it is not restricted to human beneficiaries. It is enough to say that the submission is implicitly inconsistent with the well established interpretation of the phrase, which requires promotion of the relief of poverty, suffering, distress or misfortune so that the general public or an identifiable part of it is benefited. It is true that the present argument has never been pronounced upon, but it is implicit that the decisions are directed towards human relief.

In my view the Society cannot succeed upon its primary

argument.

The question remains whether there is any possibility that a secondary argument, as to which the appellant Commissioner claims that evidence would need to be called, might allow the Society to obtain the desired exemption. It concerns the ultimate benefit that comes to human beings and society from the promotion of the Society's primary object of prevention of cruelty to animals. Pincus J.A. has set out the artificial basis upon which the parties attempted to litigate this proceeding and I adopt His Honour's statement of the course of proceedings.

I should have thought it self-evident that the promotion of the Society's objects ultimately benefits mankind, and that such activities are at least indirectly for the benefit of human beings. It is difficult to understand how this could be factually controverted. That however is in the end irrelevant, because the nature of the Society's ultimate benefit to human beings is not for the relief of the needy or underprivileged, or directed towards relief of the human conditions that traditionally call for aid. On the narrow established interpretation of "public benevolent institution" it is not open to rely upon a broad "charitable" human benefit of that kind.

It follows in my view that the conduct of further proceedings designed to ascertain the nature and extent of a general benefit to mankind from the checking of man's innate tendency to cruelty, or from the carrying out of the objects of the Society's constitution, could not succeed in bringing it within Item 81 (1) of the First Schedule, and ultimately to the benefit provided by s.5(1) of the Sales Tax (Exemptions and Classifications) Act 1935. Further proceedings would be a futility. I agree with the orders proposed by Fitzgerald P.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 66 of 1992

Before the Court of Appeal
The President
Mr. Justice Pincus J.A.
Mr. Justice Thomas
BETWEEN:

ROYAL SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS, QUEENSLAND INC.

(Applicant)

Respondent

- and-

COMMISSIONER OF TAXATION

(Respondent)

Appellant

REASONS FOR JUDGMENT - THOMAS J.

Delivered the 27th day of August, 1992

MINUTE OF ORDER:	Appeal allowed. Orders below set aside. Proceedings dismissed. No orders as to
costs on appeal or below.
Counsel:	Mr. H.G. Fryberg Q.C., with him Mr. P. Bickford for the Appellant
Mr. R.W. Gotterson, with him Mrs. P. Wolfe for the Respondent
Solicitors:	Australian Government Solicitor's Office for the Appellant
Messrs. Stephens and Tozer for the Respondent
Hearing date:	30th July, 1992