Hooper & Harrison (Qld) Ltd v Commissioner of Stamp Duties (Qld) [1924] HCA 25; (1924) 35 CLR 318 (27 June 1924)

HIGH COURT OF AUSTRALIA

Hooper & Harrison (Queensland) Limited Appellant; and Commissioner of Stamp Duties (Queensland) Respondent.

H C of A

On appeal from the Supreme Court of Queensland.

27 June 1924

Isaacs A.C.J., Rich and Starke JJ.

Real, for the appellant.

Stumm K.C. (with him Fahey), for the respondent.

The Court delivered the following written judgment:—

June 27

Isaacs A.C.J.,

Rich and Starke JJ.

A limited company formed in New South Wales and called Hooper & Harrison Ltd., the present appellant, was carrying on business as merchants and warehousemen in Queensland, and was there the owner of real and personal property, including merchandise. On 18th May 1920 the company by special resolution, confirmed on 2nd June 1920, resolved to reconstruct and to wind up. Two new companies were formed—one in New South Wales and called "Hooper & Harrison Ltd.," and the other in Queensland and called "Hooper & Harrison (Queensland) Ltd." The liquidator of the old company was, by the resolutions mentioned, authorized to enter into the agreement the subject of this appeal.

In July 1920 the liquidator in the name of the old company made an agreement with the new Queensland company, whereby, after reciting the resolutions and the incorporation of the new Queensland company, and that by the articles of association of the new company it was provided that that company should "forthwith enter into the agreements," it was agreed:—[Clauses 1, 2 and 3 of the agreement marked C were here set out.]

If the provisions of clause 1 bring the instrument within sec. 49 of the Stamp Acts 1894-1918, the agreement is admittedly dutiable as a "conveyance on sale." Sec. 49 is as follows: "For the purposes of this Act the expression conveyance on sale includes every instrument ... whereby any property, or any estate or interest in any property, upon the sale thereof, is transferred to or vested in a purchaser or any other person on his behalf or by his direction." There are provisoes, which are irrelevant to this case. The effect of the three clauses of the agreement above quoted is as follows:—Clause 1 is a sale to the new company of merchandise, already in existence and conventionally still in existence, belonging to the old company, for the fixed price of £54,121 10s. That is complete in itself; and if nothing more were said, there would be a debt of that amount payable in cash, concurrently with delivery. But the two succeeding clauses provide that the price is not to be paid in cash. A further sum of £6,484 10s. is to be handed by the old company to the new company, and that sum and the sum of £54,121 10s. owing by the new company are together to be applied by the new company to paying £1 per share on certain shares in that company, to which, not the old company, but its members are to be entitled as of right to claim. The two transactions are distinct. The immediate importance of the second or share transaction is to show that, as the shares are obviously to be issued at once and must be paid for at once, the sum of £54,121 10s. must necessarily be at once applicable, and, therefore, an instant debt. But that would be impossible unless the proprietary interest in the merchandise were instantly transferred to the new company. This is in accordance with what we understand to be the ordinary normal meaning of the first clause. That clause, then, both from its primary meaning and from its context, is one which brings the instrument within the ambit of sec. 49 as a "conveyance on sale." We were invited to say that, when that agreement is read with a contemporaneous agreement of sale of freehold land, leases, goodwill, trade marks, &c., it should be construed as other than a "conveyance on sale." But there are formidable objections to this argument. The agreements are in fact distinct and independent. The parties have physically severed them. They do not incorporate each other. The second agreement, by clause 6, expressly contemplates future acts of vesting, while the agreement under consideration contains no such provision.

The case of Commissioners of Stamps v. Queensland Meat Export Co.[1] was one where two features appeared, both of which are absent from the agreement we are dealing with. Those features were: (1) it contained expressions of future vesting, as "shall transfer" and "shall take over"; (2) those expressions were applied to land, shares, &c., which it was obviously contemplated required future formal acts of assurance.

The appeal should be dismissed with costs.

Appeal dismissed. Appellant to pay costs of appeal.

Solicitors for the appellant, Feez, Ruthning & Baynes.

Solicitors for the respondent, H. J. H. Henchman, Crown Solicitor for Queensland.

[1] (1917) A.C. 624.