Rottnest Island Authority v Collector of Customs

[1994] HCATrans 306

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• 1.6

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Perth No Pl of 1994

B e t w e e n -

ROTTNEST ISLAND AUTHORITY

Applicant

and

COLLECTOR OF CUSTOMS

Respondent

Application for special leave

to appeal

BRENNAN J

DAWSON J

TOOHEY J

TRANSCRIPT OF PROCEEDINGS

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AT CANBERRA ON FRIDAY, 6 MAY 1994, AT 2.48 PM

Copyright in the High Court of Australia

MR D.M.J. BENNETT, QC: In this matter, if the Court

pleases, I appear with my learned friends,

MR A. ROBERTSON, and MR A.A. ROBINS, for the

applicant. (instructed by Blake Dawson Waldron)

MR M.J. BUSS, QC:  May it please Your Honours, with my

learned friend, MSC.A. WYATT, we appear for the

respondent. (instructed by the Australian

Government Solicitor)

BRENNAN J:  Mr Bennett?

MR BENNETT: If the Court pleases. This Full Court decision

deprives thousands of people in isolated

communities throughout Australia of a benefit

which, in our submission, Parliament clearly

intended to be conferred upon them. It does that

on the basis of a narrow and literalistic

construction of the word "at" in two statutes, a

construction which we will show, in any event, is

wrong as a matter of grammar and syntax.

The judgment also lays down tests which we

will be submitting are internally inconsistent.	We
propose to deal with the matter in three sections:
first, the construction point; second, the importance of the matter; and third, some aspects
arising out of my learned friend's submissions.

On the question of construction, before I take

Your Honours to the section, might I first show
Your Honours the true aspects of the finding which

are of significance, one for us and one against us.

The aspect which was in our favour appears at pages 65 and 66 of the application book. What

Their Honours there hold, in accordance with a line of decisions in the tribunal and the Federal Court,

is that one may apportion, if one likes, in a case

where there are mixed purposes and, indeed, that

even in relation to an electricity generating

authority, one may apportion where the purpose is

partly to supply it to residential premises, and

partly to supply it to other premises.

I will just show Your Honours quickly what

they said. At line 8 on page 65 Their Honours say:

In our opinion, there is nothing in the

section which precludes an electricity

generating authority, private or governmental,

from having in mind that a proportion of the

fuel purchased by it will be used in the

generation of electricity to be supplied to

domestic residences -

et cetera -

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In such circumstances there would be no

impediment to a finding that the authority

purchased that amount of fuel to be used by it

for those purposes.

Then they go on to say:

However, the use of the fuel in providing

electricity to the relevant residences so that

it is then available as a source of power to

the residents -

is a -

sufficient "purposive use" -

That is emphasized on the following page where they

again say that an electricity generating authority

is not, ipso facto, ineligible.

Having made that finding, which we

respectfully support, the Full Court, at page 71,

came to a conclusion of law, and of course it had

to be a conclusion of law for it to allow the

Collector's appeal which, in our respectful

submission, not only is inconsistent with that but

goes, in a sense, so far the other way as to give

the section very little application.

What they said, starting at line 12, was this,

focusing on the word "at":

What is essential, however, is that it be

possible properly to describe the use of the

fuel by the purchaser as occurring "at" the

premises. The section, clearly, does not

require that the purchaser be one of the

residents of the premises but it does require

that he or it use the fuel to provide the

prescribed amenities in a position which can
properly be so described ..... we consider that

the section requires that, because the

generating plant is clearly contemplated -

existence of some appropriate heating or

and these are the tests -

the location of such a plant be in sufficient

proximity to the premises as to enable it

reasonably to be identified with the premises.

It must be appurtenant to the premises and

coherent with·them -

whatever that means -

It must be able to be said of the plant using the fuel that it belongs to the premises -

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That is a series of adjectives and verbs,

"identified", "proximity", "appurtenant",

"coherent", "belongs", suggesting a very close

location or connection; a location or connection

which is virtually inconceivable in the case of an

electricity generating authority supplying fuel for

a number of different purposes, except perhaps, I

suppose, in the case of the caretaker of that

authority who lives directly over the generator.

May I now take Your Honours to the section,

which appears at page 6. Your Honours see at

page 6 the section at line 18, provides that:

A rebate is ... payable to a person who

purchases diesel fuel for use by him ..... :

(b) at residential premises in -

providing food, drink, lighting, heating et cetera

in relation to those premises.

Now, the reasoning against us is very simple. That reasoning says look at the words "at

residential premises", especially the word "at".

What does that qualify? Answer, it must qualify

use.	Go back to the word "use". What is the use?
The use is of diesel fuel.	So that use must take

place at the residential premises. And that is the

reasoning.

We would respectfully submit that that

reasoning is quite wrong, when one understands the

nature of the way diesel fuel is used. Diesel

fuel, of course, is fuel which powers diesel

generating equipment. It cannot be used directly

to produce heat, light or food or drink or anything

else. All it does is make electricity. So the

diesel fuel is going into a generator somewhere.

Now, the use, we would submit, is use in the

providing food and drink, in providing lighting,

heating et cetera, or in meeting other domestic

requirements. That is the use, and it is that use

of the fuel which must take place at the

residential premises.

Now, there is no need for the fuel to be there for that to be done. Your Honours will recall in

our submissions we have given a number of examples

of cases where people use something "at", where the

person is, not where the thing being used is. The

simplest example perhaps is where Your Honours do

research using Lexis. Your Honour may use the

Lexis computer at Your Honours' chambers. The

Lexis computer is in Dayton Ohio, but Your Honour

is using it at your chambers.

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The other examples we gave are a helmsman who

uses a lighthouse, a pilot who uses a facility at

the airport to bring his plane in safely at night,
there was even a sunbather who uses the sun at a

beach. All those people are using something at the

place where the person is. And, in this example,

what is important, is that there - - -

DAWSON J: What they are using here is the electricity.

MR BENNETT: No, Your Honour, they are using the diesel

fuel. The diesel fuel is going through a process

of conversion through different forms of energy, it

is converted to electrical energy, transmitted

along the wires, then converted into heat or light

energy, and then - - -

DAWSON J:  In all the examples you gave, the commodity was

conveyed to the residential premises, or the

sunlight was conveyed to the sunbather, or the

light of the lighthouse was conveyed to the person

on the ship. Here what is conveyed to the person

in residential premises is the electricity.

MR BENNETT: With respect, Your Honour, we would say, in

each of those cases, what is used by the person is

not what is conveyed, but the thing which remains

at the other place. Your Honour is using the Lexis

computer when Your Honour is in Your Honour's

chambers - - -

DAWSON J:  You are using the image which appears - - -

MR BENNETT: Well, Your Honour, it is a matter of English, I

suppose, and one can use it in different ways, but

we would submit that certainly the lighthouse

example, the helmsman is using the lighthouse, as a
matter of English parlance, and the pilot is using
the radar transmission machine, or whatever the

device is at the airport. With modern technology,

there are many ways one can use something without

being in its presence, and this is an example of
that.	The person in the residence is using the

fuel to generate electricity.

BRENNAN J: What purpose or function do the words "at

residential premises" fulfil?

MR BENNETT:  They are to eliminate, Your Honours, the

hospital, the hotel, the boarding school, the staff
canteen, all the places where one might use diesel

fuel to provide food or drink, et cetera, other

than in a residential situation.

BRENNAN J: So, it means the same as if the last line on

page 6 were read "residents of residential

premises"?

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MR BENNETT:  Yes, Your Honour. There are many ways one

could reword the section to make it clear my way or

clear my learned friend's way.

BRENNAN J:  Now, what is the major legal question that this

involves, Mr Bennett?

MR BENNETT: Well, the major legal question is the

construction of the section, Your Honour. The

importance of it lies in the importance it has for

a very large number of people and a very large

number of pending cases. I cannot tell Your Honour

that there is a significant general question of law

as to the meaning of the word "at" or as to the

context of the sentence, but - - -

BRENNAN J: 

How then do you distinguish in these many other

cases that you are thinking of, between the station
property at Wilcannia and the small generating

plant at Dalby?

MR BENNETT: Well, Your Honour, in both cases we would

submit the Act intends to allow a rebate.

BRENNAN J: And go from Dalby, let us say, to Bunnerong.

MR BENNETT: Well, Your Honour, Bunnerong is not powered by

diesel fuel, and that is the limitation. The

limitation lies in the fact that diesel fuel is not

something which is used to power the electrical

requirements of a metropolis; it is something which

is used in a much smaller context, and that is the

limitation. Your Honour will note, it also

talks - - -

DAWSON J: Is there not perhaps some other reason - I do not

know - for the way in which the provision is

worded, because what the legislature would be

seeking to do was to prevent the use for commercial

purposes - and I know that they refer to that in

the judgment - but, in other words, if you generate

and use the diesel fuel at residential premises,

then it is truly residential as opposed to

generating at another place and then distributing

it to others; is that not a possible purpose of the

way - - -

MR BENNETT: It is possible. It is not the one which this

very judgment upholds because this case and the

numerous other cases have said that an electricity

generating authority may be within it as long as

you can say it is close enough to -

DAWSON J:  I find that very hard to accept.

MR BENNETT: Well, Your Honour, that really is the problem,

and if one goes to the second reading speech, which

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is annexed to our submissions - do Your Honours

have that? It is the very back page of our

submissions. Your Honours see in the first column

on page 1554, which is the very back page of our

submissions, the last full paragraph on the page

ends with a sentence in these terms:

A further amendment was made to make it clear

that fuel used in providing domestic lighting
for residential premises will be eligible for

the rebate.

Now, that is very specific as to what we submit.

It is true that in the first sentence of that

paragraph in enumerating the categories, the

Senator says:

The categories I referred to earlier

relate to the use of the fuel in agriculture, mining, forestry and fishing applications, in

domestic premises, hospitals, aged persons'

homes, and nursing homes.

But, that was a sort of more imprecise enumeration.

When he came to describe this particular amendment

he talked in terms of providing domestic lighting

for residential premises.

The passage, on the other hand, that my

learned friend has relied on, Your Honours may note

that in his submissions he cited a question without

notice answered by Mr Howard, in which Mr Howard

said:

those categories which will no longer be

exempt will include construction industry,

sections of manufacturing that were enjoying

the exemption, electricity generation and

transport -

we say two things about that: first, it is moving

construe a section, and even the liberality of answer without notice in Parliament in that way to from the extrinsic to the extraneous, to use an section 15AA would not extend that far.

But, secondly, and more importantly, the

quotation proves too much because electricity

generation is the very thing with which this

decision, and to a lesser degree Coober Pedy and so

on, suggest is permissible.

DAWSON J:	Does it not suggest a domestic generating plant?
MR BENNETT:	Your Honour, I am not quite sure what that

means, with respect, the - - -

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DAWSON J:	The generating plant at residential premises.
MR BENNETT:	If Your Honour means that the plant must be at,

in the sense of inside, one set of premises, and
generating for that set only, this judgment would
not support that view, nor do any of the other

cases, and there is a line of cases which say that

it is wider than that. There are cases, the

Flinders Island case, for example, where there was

an Aboriginal community with eight homes and a

communal generator, which serviced the eight homes,

and that was held to be entitled to the rebate.

And this judgment expressly affirms that decision.

DAWSON J: That is a matter of degree.

MR BENNETT: 

Your Honour, once one accepts that one can have

an apportionment, once one accepts that one can
have the generator which is supplying to the two

types of body, and once one accepts the next step

that an electricity generating authority can be

within it, it is very hard to see how one can also

have these very strict requirements about the word
"at", and we would submit that is avoided if one

construes the section the way I have submitted, and
if this decision stands, a very large number of

isolated communities will no longer be entitled to

a rebate.

DAWSON J: Really the way you read it though is, diesel fuel

used for the generation of electricity for use at

residential premises.

MR BENNETT:  Your Honour, diesel fuel is always used to

generate electricity. So there is no other way it

can be sued.

DAWSON J: That is the way you construe it.

MR BENNETT:  Your Honour, we would submit that what has to

be at the residential premises is the use in

providing food and drink, which is, as Your Honour

says, the consumption of the electricity. And we

submit that is in accordance with the second

reading speech, and in accordance really with

common sense when one looks at the overall purpose.

May I just add a little bit about the importance of

the case. Your Honours will see from page 85 there

are:

more than 130,000 applications for diesel fuel

rebates ..... and several thousand

persons ..... are affected.

My learned friend's submissions have amplified that for us and pointed out that there are, in fact,

230,000 applications and that there are around

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14,000 applications in relation to domestic

premises. That is the ones which were successful.

They do not know how many were refused. So, it is

a matter which concerns thousands of applications,

and, of course, more than that numbers of people.

There are seven cases pending which, it was pointed

out below by the Collector, when he was seeking to

have the matter heard by a Full Court, that they

involve $15 million and, of course, that sum is

obviously increasing annually in the sense that

there are annual rebates.

So, there are very large sums of money

involved for very large numbers of people. This

decision is, we would respectfully submit, totally

novel in that it cuts down the section in a way far

beyond the way it has been cut down before, by

giving this strict meaning to the work "at", and,

indeed, the strict meaning to "use at", and we
submit, very simply, that one uses the generator in

cooking by using it to make electricity with which

one cooks, and one does not just look to the

intermediate step in order to determine what the

use is.

BRENNAN J:  Mr Bennett, do you wish to say anything about

the point that is raised against you that this is,

after all, a tax case?

MR BENNETT: Yes, Your Honour. It is not a tax case. It

is, in effect, a rebate granted on a purchase which

is available where certain imposts have been paid

in relation to the fuel.

DAWSON J: It is a revenue case, anyway, is it not?

MR BENNETT: It is a revenue case in one sense but,

Your Honours, there is not an absolute rule that leave is not granted in revenue cases.

BRENNAN J:	Oh, no.
MR BENNETT: This is an important case. It is a case which

affects a lot of small communities, and we would

submit it is a case, clearly, in which leave ought

to be granted. May it please the Court.

BRENNAN J:  We need not trouble you, Mr Buss.

This application does not give rise to any

question of legal principle of general public

importance which might warrant the grant of special

leave to this Court. The question is one which is appropriate for final consideration by the Federal

Court of Australia. Accordingly, special leave is

refused.

Rottnest	6/5/94
MR BUSS:	Your Honours, I would simply ask for an order for

costs.

BRENNAN J:  You have nothing to say about that, Mr Bennett?

It will be refused with costs.

MR BUSS:  Thank you, Your Honours.

AT 3.10 PM THE MATTER WAS ADJOURNED SINE DIE

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