War Service Homes Commissioner v Collector of Imposts (Vic)

27 CLR 334

THE WAR SERVICE HOMES COMMISSIONER

THE COLLECTOR OF IMPOSTS FOR VICTORIA.

ON REMOVAL FROM THE SUPREME COURT OF Stamp Duty-Conveyance or transfer on sale of land-Transfer by direction-Inter-

mediate sale-Conveyance giving effect to sale-Transfer to War Service Homes Commissioner-Commonwealth instrumentality--Stamps Act 1915 (Vict.) (No. MELBOURNE,

2728), secs. 17, 38-Stamps Act 1918 (Vict.) (No. 2982), sec. 344 War Service Homes Act 1918 (No. 43 of 1918).

Sub-secs. 3, 5, 6 and 7 of sec. 68 of the Stamps Act 1915 (Vict.) (replaced by sec. 3 of the Stamps Act 1918 (Vict.) ) provide as follows :- (3) Every sale of real property shall be chargeable with ad valorem duty upon the con- sideration therefor, and such duty shall be paid on the conveyance (which term by sec. 62 includes "transfer") " which seeks to give effect whether

27 CLR 335

directly or indirectly to every such sale. (5) Notwithstanding anything contained in sub-secs. 3 and 4 of this section the Collector of Imposts shall exempt any conveyance from duty in respect of the consideration for any sale or sales sought to be given effect to by such conveyance made prior to the first=day of January one thousand nine hundred and nineteen. (6) Every party to a conveyance

shall fully and truly set forth in precise terms in such conveyance the consideration moving from the original purchaser and also the consideration moving from any sub-purchaser or sub-purchasers who are or who at any time have been interested in the real property the subject matter of the said conveyance or any part or parts thereof. (7) The duty payable on a sale of real property shall be borne by the purchaser at such sale and any contract or agreement whereby he seeks to relieve himself from liability therefor shall be ineffective to relieve him from such liability or to impose upon any other person any liability therefor or any obligation to recoup such purchaser or to indemnify or keep him indemnified against the payment thereof or any part thereof."

By an instrument of transfer it was stated that A, the registered proprietor of certain land, in consideration of a certain sum paid by B to A and of a certain other sum paid by the War Service Homes Commissioner to B, did thereby by direction of B transfer the land to the War Service Homes Com- missioner. The land had been sold by A to B for the sum mentioned in the transfer as having been paid by B to A. The transfer was produced by the War Service Homes Commissioner to the Collector of Imposts, who, being of opinion that it was chargeable with duty as on a transfer on sale at least on the consideration paid by B to A, assessed the duty accordingly. On a case stated by the Collector of Imposts asking the question whether the transfer was chargeable with any duty,

Held, that the transfer was chargeable under sec. 68 (3) with duty on the…

CaseChat Overview and Summary

The War Service Homes Commissioner (the Commissioner) sought the opinion of the Collector of Imposts for Victoria regarding the stamp duty payable on a transfer of land. The land was originally sold by Alice Edith Philpott to Gilbert James Williams. Subsequently, by direction of Williams, Philpott transferred the land directly to the Commissioner. The Collector assessed stamp duty on the transfer based on the consideration paid by Williams to Philpott, leading to the Commissioner's dissatisfaction and the case being stated for the court's determination.

The central legal issue before the court was whether the transfer, which gave effect to a sale from Philpott to Williams and then a direction to transfer to the Commissioner, was chargeable with stamp duty under the Victorian Stamps Act 1915 and its amendments. Specifically, the court had to determine if the duty was payable on the initial sale from Philpott to Williams, and if so, whether the Commissioner, as a Commonwealth instrumentality, was immune from such taxation.

The High Court held that the transfer was chargeable with stamp duty. The court reasoned that section 68(3) of the Stamps Act 1915 (as replaced by section 3 of the Stamps Act 1918) imposed ad valorem duty on a conveyance that gave effect to a sale. In this instance, the transfer, although executed directly from Philpott to the Commissioner, effectively gave effect to the sale between Philpott and Williams. The court found that the Commissioner had omitted to ensure Williams paid the duty on his purchase, and therefore, the liability for duty on that sale remained. The argument that the Commissioner, as a Commonwealth instrumentality, was immune from taxation was dismissed, as the duty was considered to be on the transaction of sale, not directly on the Commissioner.

The court answered the first question in the affirmative, finding the transfer chargeable with duty on the sale from Philpott to Williams. The costs of the proceedings were ordered to be paid by the Collector of Imposts.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established