Federal Commissioner of Taxation v Westgarth
(1950) 81 CLR 39624 ALJ 129
[1950] ALR 439
(Judgment by: Webb J)
Between: Federal Commissioner of Taxation
And: Westgarth
Judges:
McTiernan J
Latham CJ
Williams J
Webb JFullagar J
Subject References:
Estate Duty (Cth)
Judgment date: 23 December 1949
Judgment by:
Webb J
I think the judgment of McTiernan J. was right. (at p412)
The value of property for present purposes is the price upon which a hypothetical vendor and a hypothetical purchaser would agree, but what that price is can be only a matter of opinion of some person or persons, whether a court or others: something which a mind or minds apprehend as being the money equivalent of the property according to the test in Spencer v. The Commonwealth (1907) 5 CLR 418 . When the Commissioner of Taxes receives a return from an administrator under s. 10 of the Estate Duty Assessment Act and considers that the administrator has been mistaken as to the value of an item of property, and the commissioner's view is supported by a competent court, it might seem that a mistake of fact on the part of the administrator has been established; but I think the better view is that the court finds the administrator's opinion erroneous, and not that the administrator made a mistake of fact within the ordinary meaning of that expression. (at p412)
So far I have assumed an honest and reasonable valuation made in the light of the known facts, as in this case. Of course, if the administrator makes an unreasonably high valuation s. 20 (2) has no application: for s. 20 (2) to apply there must be an avoidance of duty. But in the case of an unreasonably high valuation by the administrator, e.g., one made inadvertently or in ignorance of notorious facts, s. 20 (1) and (4) would apply. There would then, I think, be a mistake of fact. If s. 20 is given the meaning which I think it has, justice is done both to the administrator and the commissioner, subject to the time limits s. 20 imposes. (at p413)
I would dismiss the appeal. (at p413)