Commissioner of Taxes (N.T.) v. Liveris & Ors

Judges: Kearney J
Rice J

Angel J

Court:
Court of Appeal of the Northern Territory

Judgment date: Judgment handed down 25 September 1990.

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Angel J.

The question on this appeal from a judgment of the Chief Justice dated 21 April 1989 (89 ATC 4892; (1989) 60 N.T.R. 12) is whether an agreement under seal between the respondents is a ``maintenance agreement'' for the purposes of the Family Law Act 1975 (Cth) and thus exempt from Northern Territory stamp duty by virtue of sec. 90 of the Family Law Act.

The agreement in question contains a provision for the future transfer of certain real estate from the first and second respondents, who are husband and wife, to the third respondent, the trustee of a unit trust established by a deed dated 18 December 1981. The unit holders in the trust are the first and second respondents and their adult children.

At the time the agreement in question was registered with the Family Court, that is on 15 January 1982, ``maintenance agreement'' was defined as follows:

```maintenance agreement' means an agreement in writing made, whether before or after the commencement of this Act, and whether within or outside Australia [ sic ], between the parties to a marriage, being an agreement that makes provision with respect to financial matters, whether or not there are other parties to the agreement and whether or not it also makes provision with respect to other matters, and includes such an agreement that varies an earlier maintenance agreement;''

The expression ``financial matters'' is defined as follows:

```financial matters', in relation to the parties to a marriage, means matters with respect to -

• (a) the maintenance of one of the parties;
• (b) the property of those parties or of either of them; or
• (c) the maintenance of children of the marriage;''

Does the agreement under seal between the respondents make ``provision with respect to the property of (the) parties or of either of them''? Plainly, in my view, it does. The first and second respondents agreed to transfer their land to the third respondent subject to the provisions of the unit trust. In equity they thereby divested themselves of their property. The unit trust is in common form, providing, inter alia, by cl. 7(1) thereof:

``... the beneficial interest in the trust fund as originally constituted and as existing from time to time shall be vested in the unit holders for the time being.''

A unit thus confers a proprietary interest in all the property which for the time being is subject to the trusts of the deed; cf.
Baker v. Archer-Shee (1927) A.C. 844 ,
Charles v. F.C. of T. (1953-1954) 90 C.L.R. 598 at p. 609 . The agreement provides for the divestment and acquisition of interests in the real estate, which

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ATC 4945

in my view is sufficient to constitute ``provision with respect to the property'' for the purposes of the legislation.

That is enough to dispose of this appeal.

However, as is evident from the reasons for judgment of the learned Chief Justice, with which I respectfully agree, it was argued that the definition of maintenance agreement must somehow be read down either by virtue of the other provisions of the Family Law Act or alternatively by reference to the applicable heads of Commonwealth legislative power under the Constitution, in particular sec. 51(xxi). To hold that the agreement in question was a maintenance agreement as defined was argued to be an application of the ``broadest'' literal view. It was said that such an intention could not be imputed to Parliament. The issue in this case was therefore said to be whether a literal interpretation of the definition of ``maintenance agreement'' is correct in law.

I have no doubt that it is. As Brennan J. said in
K. & S. Lake City Freighters Pty. Ltd. v. Gordon & Gotch Ltd. (1984-1985) 157 C.L.R. 309 at p. 319 :

``In choosing between a primary, broader meaning of words in a section and a secondary, narrower meaning that corresponds with the subject-matter dealt with in surrounding sections, it is relevant to consider whether the particular section has an operation independent of the operation of the surrounding sections or whether the operation of the particular section affects or is affected by the operation of the surrounding sections.''

Here, the stamp duty exemption granted by sec. 90 stands on its own and is operative apart from the other provisions of the Family Law Act. I respectfully agree with the learned Chief Justice that the literal meaning of ``maintenance agreement'' and the consequential stamp duty exemption provided by the Family Law Act cannot be narrowed by reference to other provisions of that Act as a whole.

I am unable to understand an argument that the literal meaning of an unambiguous provision in a Commonwealth Act of Parliament is somehow to be confined by reference to the legislative power of the Commonwealth. The provision, in so far as it relates to the Northern Territory, is within the Territory's power (sec. 122 Constitution) however it is construed. In relation to the States, it was held in
Gazzo v. Comptroller of Stamps (Vic.) 81 ATC 4699 ; (1981) 149 C.L.R. 227 to be outside the marriage power (sec. 51(xxi) Constitution). I do not understand, however, how that affects the construction of the statute; if the legislation was to be confined within the marriage power it would seem the High Court would have held it intra vires.

I agree with the reasons for judgment of the learned Chief Justice and his answers to the questions posed, and think this appeal should be dismissed with costs.