High Court of Australia|1996-11-14|Before: Kirby JJ

Allders International Pty Ltd v Commissioner of State Revenue [1996] HCA 58; 186 CLR 630; 71 ALJR 1; 140 ALR 189 (14 November 1996)

DAWSON, TOOHEY, GAUDRON, McHUGH, GUMMOW AND KIRBY JJ

2. Set aside orders 1 and 3 of the orders of the Supreme Court of

(a) Declare that the lease is not dutiable by reason of s 52(i)

(b) Order the respondent pay the appellant's costs including

3. Remit the matter to the Supreme Court of Victoria for the making

Solicitors for the Interveners: Australian Government

Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

Allders International Pty Ltd v Commissioner of State

Commonwealth Constitution - Exclusive legislative power - With respect to a Commonwealth place - Characterisation of State law - Whether State stamp duty payable on a lease of part of a Commonwealth place.

Taxation - State stamp duty - Nature of stamp duty - Whether payable on a lease of part of a Commonwealth place.

BRENNAN CJ. Tullamarine Airport was constructed on land acquired for the purpose by the Commonwealth of Australia. The Commonwealth remains registered as the proprietor of an estate in fee simple in that land. The Federal Airports Corporation Act 1986 (Cth) ("the FAC Act") established the Federal Airports Corporation ("FAC") as a body corporate in which, pursuant to s 28(1) of that Act, Tullamarine Airport[1] was vested "without any conveyance, transfer or assignment". The FAC holds Tullamarine Airport "for and on behalf of the Commonwealth"[2]. It is a "place acquired by the Commonwealth" for a public purpose within the meaning of those words in s 52(i) of the Constitution.

In exercise of its statutory powers[3], the FAC granted a lease to the appellant ("Allders") of a shop at the Tullamarine Airport to conduct the business of a duty free and sales tax free concession. The instrument of lease demised the premises for a term certain expiring on 31 October 2000[4]. The rent reserved was a fixed sum of $12 per annum (if demanded) plus a variable component calculated according to formulae the factors of which included the number of inbound and outbound international passengers and the average levels of their expenditure on goods to be sold by the lessee[5].

The instrument of lease was executed in New South Wales. Pursuant to s 32 of the Stamps Act 1958 (Vic) ("the Act"), Allders required the Commissioner of State Revenue in his capacity as Comptroller of Stamps of Victoria to express an opinion as to whether the instrument of lease was chargeable with duty and, if so, with what amount. In order to obtain that opinion, the solicitors for Allders lodged the executed lease with the Commissioner. The Commissioner expressed the opinion that the instrument of lease was dutiable and that duty should be assessed ad valorem on the rent calculated and paid in accordance with s 83A of the Act. Section 83A applies to a lease for a definite term of not less than 12 months where the rent cannot be ascertained at the time of execution of the lease. The calculation is based on an estimate and is re-calculated on annual re-estimates of the rent during the term of the lease.

Stamp duty is chargeable on instruments pursuant to s 17(1) of the Act which reads as follows:

" Subject to the exemptions contained in the Third Schedule and in any Acts for the time being in force, there shall be charged for the use of Her Majesty upon the several instruments specified in the said Schedule the several duties and additional duties therein specified."

"There shall be charged and paid for the use of Her Majesty upon and for the several instruments hereinafter specified the several stamp duties hereinafter specified".

The Third Schedule also provides for the payment of additional stamp duties. Leases are brought to charge by Heading VIII of the Third Schedule at a rate calculated ad valorem on the rent[6].

By an originating notice of motion, Allders claimed a declaration that, by reason of s 52(i) of the Constitution (inter alia), the lease was not dutiable. That provision reads:

52. The Parliament shall, subject to this Constitution, have exclusive power to make laws for the peace, order, and good government of the Commonwealth with respect to -

(i) The seat of government of the Commonwealth, and all places acquired by the Commonwealth for public purposes".

Harper J dismissed the claim. An appeal to the Court of Appeal of the Supreme Court of Victoria was removed into this Court under s 40(1) of the Judiciary Act 1903 (Cth).

In Worthing v Rowell and Muston Pty Ltd[7], Menzies J said:

"[T]o the extent to which [s 52] grants legislative power to the Parliament, it denies legislative power to the Parliaments of the States. The denial is measured by the grant."

The denial of power to the Parliaments of the States does not depend upon the enactment of a law in exercise of a power conferred on the Commonwealth Parliament by s 52. Section 52, unlike s 109, does not suspend the operation of a valid State law that is inconsistent with a valid Commonwealth law; it denies the validity of a measure enacted by a State Parliament to the extent that s 52 confers on the Parliament of the Commonwealth a power to enact a measure having the same operation.

The boundaries of the power withdrawn from the States are charted by the grant of power to the Commonwealth and that grant is to be interpreted with the same generality as the grant of other powers[8]. However, the power conferred by s 52(i) is not a power to make laws for "the peace, order, and good government" of the seat of government and of Commonwealth places: it is power to make laws "for the peace, order, and good government of the Commonwealth with respect to" the seat of government and Commonwealth places. It is a plenary power with respect to a specified subject[9]. In a well-known passage in his judgment in Bank of NSW v The Commonwealth[10], Latham CJ said:

"In determining the validity of a law it is in the first place obviously necessary to construe the law and to determine its operation and effect (that is, to decide what the Act actually does), and in the second place to determine the relation of that which the Act does to a subject matter in respect of which it is contended that the relevant Parliament has power to make laws. A power to make laws with respect to a subject matter is a power to make laws which in reality and substance are laws upon the subject matter. It is not enough that a law should refer to the subject matter or apply to the subject matter: for example, income tax laws apply to clergymen and to hotelkeepers as members of the public; but no-one would describe an income tax law as being, for that reason, a law with respect to clergymen or hotelkeepers."

The specified subject matter of s 52(i) is the seat of government or a Commonwealth place. Each is "an area of the earth's surface, of its subjacent soil or of its superincumbent air to the possession of which a right may by law be had or obtained"[11]. A law enacted in exercise of the power must therefore be a law with respect to a topographical locality. It must have such a nexus with the relevant locality as will attract the support of the power. Conversely, a State measure that has such a nexus is to that extent invalid. Of course, the invalidity of a State measure would immediately appear if it adopted the nexus as a criterion of its operation, but that is too narrow a test for determining the exclusivity of Commonwealth legislative power. In Worthing and in R v Phillips[12], State laws of general application were held invalid to the extent that they operated upon conduct engaged in or activities undertaken in a Commonwealth place. Menzies J in the former case[13] and Barwick CJ in the latter case[14], observed that, on the acquisition of a Commonwealth place, the operation of State laws on conduct or activity within the relevant locality is excluded. In Attorney-General (NSW) v Stocks and Holdings (Constructors) Pty Ltd[15] a State planning law was held invalid in so far as it purported to impose planning control over - and thus govern the use of - a Commonwealth place. These cases were decided on the footing that Commonwealth legislative power conferred by s 52(i) extended to the regulation of conduct and activities in and the use of the seat of government or a Commonwealth place. But logically the power which s 52(i) confers on the Parliament cannot be so confined. It must extend to legislative control of any act, matter or thing that occurs or exists within a relevant locality. If the Commonwealth law were expressed to apply to the occurrence or existence of the act, matter or thing within the relevant locality, to that extent it would be supported by s 52(i). The material nexus would be between the act, matter or thing to which the law applied and the locality where the act, matter or thing occurred or existed. Correspondingly, a State law of general application that applies to any act, matter or thing that occurs or exists in a Commonwealth place is to that extent[16] beyond power.

The question whether a State law is invalid by reason of s 52(i) does not depend on the characterising of the law in its general operation as a law with respect to the seat of government or a Commonwealth place: it depends on whether the law has an operation upon acts, matters or things that are connected with the relevant locality to the extent that would support a Commonwealth law under s 52(i) expressed to operate upon the same acts, matters or things. If it were otherwise the area of operation of the State law would overlap with the area within which a Commonwealth law enacted in exercise of the s 52(i) power could operate. And that would offend the exclusivity of Commonwealth power mandated by s 52.

Although s 51(ii) restricts the exercise of the Commonwealth's power to make laws with respect to taxation, the power to make laws with respect to taxation of acts, matters or things occurring or existing within the seat of government or a Commonwealth place is made exclusive by s 52(i). If the restriction created by s 51(ii) does affect the exercise of the Commonwealth power to tax within a relevant locality - a question that need not now be decided - the restriction does not enhance the legislative power of the State in which the locality is situated. In this respect, it is necessary to qualify the general proposition that "the denial is measured by the grant". The restriction may limit the Commonwealth power, but there is no corresponding enlargement of State power.

It is not necessary in the present case to consider the extent to which a Commonwealth law may be supported by s 52(i) or State laws may be invalidated by that paragraph when the law operates outside the seat of government or a Commonwealth place. In the present case, the appellant seeks to deny liability to pay stamp duty on the lease on the footing that the law purports to impose a duty by reference to the use of part of a Commonwealth place by the creation of a leasehold interest over that part and (by reason of s 83A of the Act) by reference to the economic activity that occurs there. Those factors are said to give to the Act in its application to the instrument of lease the character of a law with respect to a Commonwealth place or to give the Act an operation within the Commonwealth place. To consider that submission, it is necessary to identify with some precision the operation of the Act upon the instrument of lease and on its provisions relating to the calculation of rent.

In Commissioners of Inland Revenue v Angus[17], Lord Esher MR, speaking of the Stamp Act 1870 (UK), said that "[t]he first thing to be noticed is, that the thing which is made liable to the duty is an 'instrument'". At least since the consolidation of the English stamp duty legislation in 1870, it has been settled law that stamp duty is a tax on instruments and not on transactions effected by instruments[18]. As Dawson J shows, that proposition has been accepted in this Court in the interpretation of stamp duty statutes which have followed the broad structure of the English consolidation of 1870[19]. It is a proposition that is borne out by the terms of the Act which selects the instrument of lease as the subject of the tax it imposes. When a dutiable instrument is not executed on stamped material, or on material to which stamps are subsequently affixed, the amount of stamp duty paid and any penalty assessed are denoted by an impressed stamp on the instrument[20]. The stamp duty imposed on a lease is payable by the lessee[21] and, when the duty becomes due, it is deemed to be a debt due to Her Majesty and payable to the Comptroller of Stamps[22].

The tax imposed by the Act on the lease here in question was not imposed as a tax on the execution of the lease nor on the leasehold estate created by the instrument of lease nor on the premises leased; it was imposed on the instrument by which the demise was purportedly effected. It was submitted by counsel for Western Australia that, by reason of the registration requirements of the Transfer of Land Act 1958 (Vic), the instrument of lease did not effect a demise of the leased premises to the appellant and, on that account, the tax imposed on the instrument of lease could not be regarded as a law with respect to the demise or the land demised. It may be that the Transfer of Land Act does not apply to leases granted by the FAC in exercise of its statutory powers, in which case the legal term is vested in the lessee without registration. It is not necessary to decide whether the registration provisions of the Transfer of Land Act apply to leases granted by the FAC. It is sufficient that the instrument here in question answered the description of a lease or, alternatively, of an agreement for a lease.

It was not contested that duty was imposed as a tax on the instrument of lease but, it is said, the law which imposes it is also a law with respect to a Commonwealth place. The connection between the law and the place may be of practical rather than legal significance but, so the argument runs, the practical connection is sufficient to establish the lack of State legislative power. In The Tasmanian Dam Case[23], Mason J recited what Menzies J said in Herald and Weekly Times Ltd v The Commonwealth[24]:

" 'A law governing a particular relationship may, however, be supported by a legislative power with respect to a subject-matter notwithstanding that the connexion between the legal relationship and the subject-matter of legislative power is of practical rather than of legal significance.' "

" The requirement that there should be a substantial connexion between the exercise of the power and its subject-matter does not mean that the connexion must be 'close'. It means only that the connexion must not be 'so insubstantial, tenuous, or distant' that it cannot be regarded as a law with respect to the head of power: Melbourne Corporation[26]."

Does the Act, by imposing a stamp duty on the instrument of lease, in fact place a tax upon the Commonwealth's disposition of a leasehold estate in the premises or place a tax upon the lessee's use of the premises? Or is the connection between the tax imposed by the Act and that transaction or that use so tenuous or distant that, in so far as it affects that transaction or use, the Act cannot be characterised as a law with respect to Tullamarine Airport or with respect to the part of Tullamarine Airport that is the subject of the lease?

The character of a tax imposed upon an instrument of lease of land within a Commonwealth place must be determined as a matter of substance, not of form. The fact that a stamp duty was imposed on receipts did not prevent the duty from being a duty of excise having regard to the provisions of the State law imposing it considered in Western Australia v Hamersley Iron Pty Ltd [No 1][27]; Associated Steamships Pty Ltd v Western Australia[28] and Western Australia v Chamberlain Industries Pty Ltd[29]. In those cases, however, the requirement to bring an instrument into existence on receipt of money for goods sold showed that the impost was in the nature of a sales tax rather than simply a stamp duty. But the character of the impost as a stamp duty did not preclude its characterisation as a duty of excise. In subsequent cases where it has been necessary to identify the character of an impost for constitutional purposes, the substantial operation of the law imposing the tax, as distinct from the form of a tax, has been treated as the determining factor: see Gosford Meats Pty Ltd v New South Wales[30] and Queensland v The Commonwealth. The First Fringe Benefits Tax Case[31]. When, in the last-mentioned case, the question arose whether a tax was to be characterised for the purpose of s 114 of the Constitution as a tax "on property of any kind belonging to a State", Mason, Brennan and Deane JJ[32] said that question

"must be determined by reference to matters of substance rather than mere form. It is 'the substance of the operation of the statute, rather than merely its form' which is 'definitive of the relevant nature of the tax it imposes or exacts': see Dickenson's Arcade Pty Ltd v Tasmania[33]; Hematite Petroleum Pty Ltd v Victoria[34]; Gosford Meats Pty Ltd v New South Wales[35]. It follows that if the impost which the relevant law seeks to impose is in substance a tax on property belonging to a State, it will be prohibited by the section."

There is no doubt that the imposition by the Act of a stamp duty on leases is not a colourable attempt to impose a tax of a different character. It is in truth imposed as a tax upon the instrument. Nevertheless the substantial effect of the tax on a lease by which premises are demised is to burden the transaction that the lease is expressed to effect, namely, the demise. It is not to the point that it is arguable that a demise could have been effected by parol followed by entry by the lessee. What attracts the impost is the instrument which, as a demise, is brought within the description of "lease" in Heading VIII of the Third Schedule. If the instrument failed to create a legal leasehold estate for want of registration under the Transfer of Land Act (or for any other reason), it would have taken effect as an agreement for lease and would have been chargeable as such under the same head of charge. It is impossible in any practical sense to separate the instrument from the effect which it is expressed to produce and produces. It is precisely on that account that the tax exigible as a stamp duty upon the instrument burdens the demise (or the disposition of an equitable leasehold interest in the premises intended to be leased).

Some attempt was made to arrive at this conclusion in reliance upon the operation of s 83A of the Act which quantifies the duty by reference (it may be said) to the use by the lessee of the premises. In my view s 83A is not relevant to the characterisation of the impost. It would have the same character, namely, a tax upon the instrument and a burden on the demise (or the disposition of an interest) it effects whether the amount of the duty were calculable finally on execution (as it would have been if the rent were then fixed) or whether the amount of duty is calculated pursuant to s 83A and adjusted from time to time during the term in accordance with that section.

Although the tax burdens the demise (or the disposition of an interest), the tax is not payable by the Commonwealth; it is payable only by the lessee. It cannot therefore be said to be a tax which burdens the Commonwealth's use of a Commonwealth place by taxing the demise of the premises or the disposition by the Commonwealth of an interest therein. But detriment to the Commonwealth is not an essential criterion for determining whether a State law is invalidated by s 52(i)[36]. That paragraph invalidates the State law which operates on any act, matter or thing which has such a connection with a Commonwealth place as would support a law expressed to apply to that act, matter or thing. A Commonwealth law which would tax the creation of a leasehold interest in land within a Commonwealth place would have a direct and close connection with the locality, irrespective of the fact that the lessee alone is accountable. By imposing a tax which burdens the demise of (or the disposition of an interest in) premises within a Commonwealth place, the Act applies to a transaction affecting the ownership of proprietary interests in a Commonwealth place. The operation of the Act which brings the instrument to charge thus reveals a nexus with a Commonwealth place that invalidates that operation. It follows that the Act, so far as it affects the instrument of lease here in question, is invalid by reason of s 52(i).

I would therefore allow the appeal and declare that the lease is not dutiable by reason of s 52(i) of the Constitution. Having made that declaration the matter should be remitted to the Supreme Court of Victoria to make such further or consequential orders, if any, as might be appropriate in the circumstances. The respondent should pay the costs both here and in the Supreme Court to date.

DAWSON J. The Commonwealth is the registered proprietor of the land, which it acquired in 1961, comprising Tullamarine Airport in the State of Victoria. That land became a Federal airport under Pt IV of the Federal Airports Corporation Act 1986 (Cth) and, under s 28(1), became vested in the Federal Airports Corporation "without any conveyance, transfer or assignment". Section 29(1) provides that, while a place owned by the Corporation is a federal airport, that place is held by the Corporation for and on behalf of the Commonwealth.

By an instrument in writing dated 17 June 1993, the Corporation leased to the appellant, Allders International Pty Ltd, premises at Tullamarine Airport for a term commencing on 1 November 1992 and expiring on 31 October 2000. It is a term of the lease that the appellant conduct a duty free store on the leased premises.

The appellant had earlier been the lessee of corresponding premises at Tullamarine Airport and the earlier lease had been submitted to the respondent, the Comptroller of Stamps, for stamping with a nominal duty. The lease was so stamped. The subsequent lease was submitted to the Comptroller of Stamps upon the same basis, but he contends that it is fully dutiable under the provisions of the Stamps Act 1958 (Vic).

The appellant denies that the lease is dutiable at all. It contends that, to the extent that the Stamps Act purports to apply to a lease of land at Tullamarine Airport, it is a law with respect to a place acquired by the Commonwealth for public purposes and is excluded by s 52 of the Constitution. Section 52, as far as is relevant, provides:

"The Parliament shall, subject to this Constitution, have exclusive power to make laws for the peace, order, and good government of the Commonwealth with respect to -

(i) The seat of government of the Commonwealth, and all places acquired by the Commonwealth for public purposes".

There is no dispute that the Commonwealth acquired the land comprising Tullamarine Airport for public purposes, although the Comptroller argues (very much as a subsidiary argument) that the demised premises ceased to be a place acquired by the Commonwealth for public purposes upon their being leased to the appellant. It is convenient to put that argument to one side and proceed upon the basis that the demised premises continue to fall within the description of a Commonwealth place in s 52(i).

It was held by a majority of this Court in Worthing v Rowell and Muston Pty Ltd[37] that s 52(i) gives to the Commonwealth Parliament an exclusive power to legislate generally with respect to places of the kind referred to in that provision. In that case, New South Wales building regulations were held to have no application within the RAAF Base at Richmond in New South Wales, that being a place "acquired by the Commonwealth for public purposes" within the meaning of s 52(i). This decision was followed in Attorney-General (NSW) v Stocks and Holdings (Constructors) Pty Ltd[38] in respect of a place acquired by the Commonwealth in New South Wales for use as a rifle range. In R v Phillips[39] it was held that, upon the acquisition of a place by the Commonwealth for public purposes, the effect of s 52(i) was to displace State laws which had previously applied in that place. In that case the place was an RAAF Base in Western Australia and the law was the Criminal Code Act 1913 (WA).

As a result of these decisions the Commonwealth Places (Application of Laws) Act 1970 (Cth) was passed. Sub-section (1) of s 4 of that Act applies the laws of a State, whether in force before or after the commencement, to Commonwealth places within the State, but that sub-section is expressed not to "have effect so as to impose any tax"[40]. The wording of the exception suggests that its purpose was to avoid offending s 55 of the Constitution which requires laws imposing taxation to deal only with the imposition of taxation, but it is sufficient to exclude the Stamps Act, which is clearly an Act imposing a tax, from being applied by the Commonwealth Places (Application of Laws) Act.

But that is no indication that the operation of the Stamps Act is in any way curtailed by s 52(i) of the Constitution. A law imposing a tax does not immediately answer the description of a law with respect to a place and it could only be a law with respect to a Commonwealth place (using that term in its s 52(i) sense) which falls within the exclusive power of the Commonwealth Parliament under the line of authority beginning with Worthing v Rowell and Muston Pty Ltd. Leave to reopen that decision was refused in this case[41]. It is therefore necessary to proceed upon the basis that it and the following decisions were correctly decided although it can hardly be denied that this case serves to emphasise some of the anomalies which flow from the interpretation of s 52(i) adopted in those cases.

It is necessary in this case to appreciate at the outset the nature of the power of the Commonwealth to make laws with respect to taxation. That power, wherever its source in the Constitution, can only be a power to tax for federal purposes. As Dixon CJ remarked in The State of Victoria v The Commonwealth[42], "the power to make laws with respect to taxation has never been, and, consistently with the federal character of the Constitution could not be, construed as a power over the whole subject of taxation throughout Australia, whatever parliament or other authority imposed taxation". Evatt J made the same point in West v Commissioner of Taxation (NSW)[43] where he said that the Commonwealth's power to tax "relates only to taxation by the Commonwealth for the purpose of its raising a Commonwealth revenue". And, as Griffith CJ said in The Municipal Council of Sydney v The Commonwealth[44], "the taxation referred to is federal taxation for federal purposes". In this sense, which is a legal and not an economic sense, Commonwealth taxes and State taxes never collide and, taking stamp duty as an example, it would be constitutionally possible for both the Commonwealth and a State to impose stamp duty on the same instrument. The power of the Commonwealth to tax and the power of a State to tax are different powers and for that reason exclusive of one another. Section 52(i) adds nothing to that proposition, which is reflected in the prohibition in s 114 of the Constitution against State taxation of Commonwealth property and Commonwealth taxation of State property. All of this is to indicate that if this appeal succeeds it must do so for a reason other than an inconsistency between a Commonwealth tax and a State tax upon the same subject-matter[45]. However, it also points to something of greater significance and I shall return to it in a moment.

The source of the Commonwealth's power to tax is, however, important. The existing cases establish that s 52(i) gives to the Commonwealth Parliament an exclusive power to legislate generally with respect to Commonwealth places. If s 52(i) were to stand alone, it would upon that basis confer a power to make laws upon the subject of taxation with respect to Commonwealth places. But the Commonwealth Parliament already has that power under s 51(ii) which provides that it may make laws with respect to "[t]axation; but so as not to discriminate between States or parts of States". The power given by s 51(ii), apart from the limitation, is of the most general kind and renders it unnecessary to look for a more specific power to make laws with respect to taxation in s 52(i). It is hardly to be thought that because of s 52(i), the power to make laws upon the subject of taxation with respect to Commonwealth places is extracted from the otherwise general power conferred by s 51(ii). The wording of s 52(i) does not suggest that, being concerned, as it is, with the exclusivity of the power to make laws with respect to Commonwealth places rather than the content of the power. That being so, it is difficult to see how s 52(i) could confer upon the Commonwealth Parliament a power to make laws with respect to taxation in a specific instance when it already had that power generally.

Nor is it convincing to my mind to say that the intended effect of s 52(i) is to remove, in respect of Commonwealth places, the limitation imposed by s 51(ii) that a law with respect to taxation must not discriminate between States or parts of States. Not only is there no hint of that in s 52(i), but since Commonwealth places within the meaning of s 52(i) must necessarily be in States[46], such an interpretation would be completely subversive of the policy manifested by the limitation imposed upon s 51(ii). As Dixon CJ said in Attorney-General (Cth) v Schmidt[47]:

"It is hardly necessary to say that when you have, as you do in par (xxxi), an express power, subject to a safeguard, restriction or qualification, to legislate on a particular subject or to a particular effect, it is in accordance with the soundest principles of interpretation to treat that as inconsistent with any construction of other powers conferred in the context which would mean that they included the same subject or produced the same effect and so authorised the same kind of legislation but without the safeguard, restriction or qualification."

Perhaps it is not necessary to decide the point in this case but, in my view, s 52(i) is not the source of any Commonwealth power to impose taxation. Even if it were, it is difficult to see how s 52(i) could make the Commonwealth's power to impose Commonwealth taxation exclusive, since it is by its very nature exclusive. Just as the Commonwealth has no power to impose State taxes, the States have no power to impose Commonwealth taxes. Section 52(i) adds nothing to the mutually exclusive nature of the Commonwealth and States' power to tax.

The question to be answered is whether the Stamps Act is a law with respect to places acquired by the Commonwealth for public purposes. Such places would include Tullamarine Airport which - and it is common ground - was acquired by the Commonwealth for public purposes. If the Stamps Act is such a law, then to the extent that it is, it can have no application because the power to impose such a tax is exclusive to the Commonwealth under s 52(i).

As I have said, the fact that a law imposes taxation does not necessarily, or even usually, mean that it is a law with respect to any place. Ultimately, as was pointed out in Queensland v The Commonwealth (The First Fringe Benefits Tax Case)48, taxes are imposed upon persons but it is common to speak of taxes upon property or land. No doubt it is also possible to speak of a tax upon a place, at all events in the context of s 52(i), because a place within the meaning of that provision must be acquired and constitute property of one kind or another. Property does not pay taxes but individuals do and an individual may be liable to pay tax because of some relationship between himself or herself and property. If the relationship between the tax and the property is sufficiently direct and substantial then the tax may be said to be a tax on property. Thus a tax upon the holding or ownership of property will be a tax upon property, whether or not the tax is actually charged upon the property. Municipal rates, whether or not a charge upon the land, are a good example of a tax on property[49]. On the other hand, a tax upon a transaction, even if it involves the use of property, is not ordinarily a tax upon property.

No doubt these concepts do not provide any direct answer to the question whether the Stamps Act is a law with respect to Commonwealth places, but they do explain why it is correct to say that a law imposing taxation is not necessarily a law with respect to property or, more pertinently for present purposes, a law with respect to places. It is, of course, necessary to go further in order to answer the question posed and to examine the nature of the tax imposed by the Stamps Act.

However, before embarking on that examination it may be said that any analysis of a traditional stamp duty reveals that it is a tax upon an instrument, not a tax upon a transaction, let alone a tax upon property. To speak of a stamp duty as a tax upon an instrument is not to employ a slogan or a metaphor. It is to express a legal conclusion as to the nature of the tax - a conclusion which has been accepted for many years by countless authorities both in this country and elsewhere. In relation to the Stamp Duties Act 1898 (NSW) Griffith CJ said in Rosehill Racecourse Company v Commissioner of Stamp Duties (NSW)[50]:

"The scheme of the Act is to make it payable on the conveyance, that is, on the instrument, not on the transaction, and the duty is calculated at so much per centum on the amount or value of the consideration for the sale, which I take to mean the amount or value in money, or if there was some other consideration, then on the pecuniary value of that consideration. The Statute does not tax the transaction."

In Commissioner of Stamp Duties (Q) v Hopkins[51] Latham CJ pointed out that:

"It is true that, as has often been said, the Stamp Duty Acts impose duties upon instruments and not upon transactions. It is obvious that you can stick a stamp or impress a stamp upon an instrument, but not upon a transaction. But, in order to determine whether an instrument is dutiable, it is nevertheless necessary to ascertain the legal operation of the instrument, ie, to determine the nature of the transaction which it accomplishes."

Mason J referred to that passage in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW)[52] in observing that it is "a fundamental principle of the law relating to stamp duties that duty is levied on instruments, not on the underlying transactions to which they give effect"[53].

In Associated Steamships Pty Ltd v Western Australia[54], Barwick CJ elaborated what is meant by saying that a stamp duty is a tax upon an instrument. He said:

"A stamp duty upon an instrument is, in my opinion, essentially a tax upon the creation of the instrument. If it is not brought into existence there is no instrument to bring to duty. Whether or not there is an instrument is a matter for the party or parties to it. Thus, as it seems to me, viewed as a tax upon an activity, the stamp duty on such an instrument is a tax upon the creation of the document. It is not a tax upon the property the subject matter of the instrument or upon the activity out of which the decision to create the document arose."

However, the statement that a stamp duty is a tax upon the creation of an instrument requires qualification. No doubt an instrument must be created before there can be any liability to stamp duty, but the tax is nevertheless a tax upon the instrument itself, because it is the existence of the instrument within the jurisdiction of the taxing authority which attracts the tax. As this Court said of the Stamp Duties Act 1866 (Q) in Commissioners of Stamps (Qd) v Wienholt[55]:

"What is made dutiable, then, is the instrument and not the transaction, and again the instrument itself and not the fact of execution. If originating in Queensland, the fact of execution conclusively evidences, so to speak, or necessarily carries within itself, the existence of the instrument, but it is the concrete existing instrument itself within the jurisdiction, and not the abstract incident of execution, which is the subject of taxation. If originating outside the jurisdiction, it is also so far outside the ambit of the Statute. When it comes in, and answers the description, it becomes, as a concrete subject, then dutiable under the law of the State."

Stamp duties payable under the Victorian Stamps Act are in a traditional form which has evolved over a considerable number of years[56]. Under s 17(1) and the Third Schedule, duties are charged upon specified instruments which include leases. Section 30 provides that

"... no instrument executed in any part of Victoria or relating wheresoever executed to any property situate or to any matter or thing done or to be done in any part of Victoria shall except in criminal proceedings be pleaded or given in evidence or admitted to be good useful or available in law or equity unless it is duly stamped in accordance with the law in force at the time when it was first executed".

It is s 30 which provides the primary means of ensuring that the duty is collected by withholding the assistance of the courts in enforcing the instrument or allowing it to be used in court proceedings[57]. An unstamped instrument may not be registered[58]. Unstamped instruments are, however, receivable in evidence on payment of duty and penalty[59]. A penalty is payable for failure to stamp an instrument which is required to be stamped[60]. The scheme of the Act is that the obligation to pay the duty is in the form of an obligation to stamp the instrument; they are one and the same thing[61]. Under s 17A(1) duty is deemed to be a debt to the Crown and payable to the Comptroller. Section 17A(1) was inserted in the Act only in 1979[62]. Without such provision, the Act would not create any liability to pay duty as a debt. As O'Connor J said in Cobar Corporation Ltd v Attorney-General for New South Wales[63] of the Stamp Duties Act 1898 (NSW) (which did not contain any equivalent of s 17A(1)):

"The scheme, following that of English legislation on the subject, is not to impose a duty in respect of which a liability to pay is created, but to make it to the interest of every person who executes an instrument or is interested under an instrument that it should be stamped. The instrument, if not stamped, confers no rights and imposes no obligations which can be enforced in a Court of Justice. It cannot be registered. If the instrument is not stamped within a certain time, a fine of 20 per cent is imposed, and the person failing to stamp it, or the person who seeks to use it unstamped, is liable to pay the penalty. The scheme of the Act is to rely upon these inducements appealing to the self interest of persons executing or taking advantage of the instrument."

Section 17(4) of the Stamps Act is, perhaps, of particular significance in the present context. It provides:

"Where an instrument which relates to property in Victoria or to any matter or thing done or to be done in any part of Victoria is executed and held in some place outside Victoria the provisions of this Act shall extend and apply to the instrument notwithstanding that the instrument is not in Victoria in all respects as if the instrument were executed in Victoria."

That provision was inserted in 1980[64] and originally applied only to mortgages. Subsequently in 1980[65] it was extended to other instruments. What is noteworthy about the provision is that, in expressing an intention that the Stamps Act should have an extraterritorial operation[66], s 17(4) does not extend its application by reference to property or transactions, but applies it to extraterritorial instruments as if they were executed in Victoria, thus emphasising the fact that the tax thereby imposed is a tax upon instruments.

And where, because of its execution within the jurisdiction, an instrument embodying a transaction relating to property outside the jurisdiction is liable to stamp duty, it is the instrument which attracts the duty rather than the location of the transaction or of the property to which it relates. Thus in Re Wright[67] a conveyance, executed in England upon a sale of land in Australia, was required to be stamped. It would be wrong to regard the tax in that instance as being a tax upon Australian property or the law which imposed the tax as being a law with respect to an Australian place.

So it would be wrong in this case, in my view, to regard the stamp duty upon the lease in question as a tax upon property in a Commonwealth place or the law imposing the tax as a law with respect to a Commonwealth place.

Notwithstanding the acquisition by the Commonwealth of a place within a State, it remains within the State and part of the State. As Windeyer J observed in Worthing v Rowell and Muston Pty Ltd[68] the Commonwealth holds such places by virtue of a proprietary right and not in the same way as territories surrendered to and accepted by the Commonwealth under s 111 of the Constitution. The difference is "the difference between political dominion and a proprietary interest". In the trilogy of cases beginning with Worthing v Rowell and Muston Pty Ltd, no member of the Court, with the exception perhaps of Menzies J[69], held the view that s 52(i) completely excluded the operation of all State laws in Commonwealth places. That is understandable because it is difficult to conceive of a situation in which, for instance, State Constitution Acts had no application in places which nevertheless remained part of a State. In attempting to identify a law which might answer the description of a law with respect to a Commonwealth place in Worthing v Rowell and Muston Pty Ltd, Barwick CJ spoke[70] of a law regulating conduct within that place. Similarly, Windeyer J referred[71] to a law with respect to conduct within a place or transactions there or conduct outside a place affecting that place or activities there. Walsh J thought[72] that for a law to be with respect to a place it should have a direct and substantial connection with that place. In Attorney-General (NSW) v Stocks and Holdings (Constructors) Pty Ltd[73] Windeyer J said that it was clear that a law, whether in general or specific terms, which restricts and controls the use to which a place can be put is a law with respect to that place.

Once it is recognised, as I think it must be, that a State law having an operation within a Commonwealth place is not necessarily a law with respect to that place, it is clear that the Stamps Act, imposing as it does a tax upon instruments and not transactions or the subject-matter of transactions, is not a law with respect to Commonwealth places. It is the existence of an instrument within Victoria, or elsewhere under such extended jurisdiction as is asserted by the Act, which attracts the tax. The Stamps Act does not seek to regulate conduct within a Commonwealth place nor does it affect a Commonwealth place or activities there. It does not have a direct or substantial connection with such a place[74]. Indeed, it does not have any connection at all save that the subject-matter of a transaction embodied in an instrument may be located in a Commonwealth place and ad valorem duty may be calculated with reference to the transaction[75]. The latter circumstance does not mean that the tax is imposed either on a transaction or its subject-matter; it is merely a means of arriving at the amount of duty payable. The Stamps Act in no way restricts or controls the use to which a Commonwealth place may be put. For these reasons, the Stamps Act is not a law with respect to a Commonwealth place and so does not trespass upon the exclusive power of the Commonwealth under s 52(i). That is sufficient to answer the question in this case, but there is, I think, a more fundamental reason for arriving at the same result.

Taxation is an essential attribute of government because it provides the most important means of raising the revenue required for its functioning. Different governments impose different taxes. As I have said earlier, a Commonwealth tax is a different tax from a State tax, not only because it is imposed by a different government, but also because the revenue raised is required for different governmental functions. The Stamps Act is a law of the kind which the Commonwealth could not pass even if, contrary to the view which I have expressed, it could impose taxation pursuant to its exclusive power to make laws with respect to Commonwealth places. If the denial of State power effected by s 52(i) is measured by the extent of the grant of exclusive legislative power to the Commonwealth[76], the appellant must be unsuccessful for a very simple reason: the Commonwealth cannot impose a State tax. In that respect, a law which imposes a tax is different from a law dealing with building operations or crimes[77], for it makes sense to speak of an exclusive Commonwealth power to enact laws on those subjects in respect of Commonwealth places. It makes no sense to speak of an exclusive Commonwealth power to enact laws imposing State taxes in respect of Commonwealth places.

Moreover, a State tax raises revenue for State purposes and it does so by imposing an obligation to pay money to the State. Ultimately the burden falls upon persons within the State or within such extraterritorial jurisdiction as the State can and cares to exercise. If a State law imposing a general tax is a law with respect to any place it is a law with respect to the State since the purpose and effect of the law is to raise revenue for the State. For example, a State law imposing income tax or a payroll tax would not be a law with respect to any particular place, including any Commonwealth place, in the State. It would operate throughout the State raising moneys which would constitute State revenue.

In the same way, the Stamps Act is not a law with respect to any particular place within the State of Victoria. A Commonwealth place, such as Tullamarine Airport, is a place within the State of Victoria. The Stamps Act operates throughout the State and the fact that in its operation it does not exclude Commonwealth places does not make it a law with respect to those places. I would venture to suggest that for the same reasons a State law imposing a tax generally upon property within the State would not be a law with respect to Commonwealth places forming part of the State. Such a tax would, of course, fall foul of s 114 of the Constitution. But it is unnecessary to go so far. Clearly the tax imposed by the Stamps Act is not a tax upon property.

For these reasons, the Stamps Act has a valid application with respect to the lease in question and it is unnecessary to deal with the argument that the premises ceased to be a Commonwealth place upon being leased.

TOOHEY J. The question before the Court is whether duty is exigible, pursuant to the provisions of the Stamps Act 1958 (Vic) ("the Act"), upon a lease for eight years granted by the Federal Airports Corporation to the appellant of premises in Melbourne (Tullamarine) Airport[78]. The premises are used as a duty free store.

The circumstances in which the question came before the Supreme Court of Victoria and was later removed into this Court appear in the judgment of McHugh, Gummow and Kirby JJ, as do the material facts and statutory provisions. For the most part it is unnecessary to say anything more on those matters.

The scope of these reasons is further reduced because of the Court's refusal of leave to reopen the decision in Worthing v Rowell and Muston Pty Ltd[79] and later decisions relating to s 52(i) of the Constitution [80]. It follows that the answer to the question posed for the Court must accord with those decisions. The land now constituting the federal airport was acquired by the Commonwealth in 1961, that is, after the State enactment. Worthing itself was concerned with a State law made subsequently to the acquisition by the Commonwealth of a place for public purposes. So too was Stocks and Holdings. However, in light of Phillips, it must be accepted that the principles enumerated in Worthing apply even if the State law preceded the acquisition by the Commonwealth.

Section 52(i) of the Constitution confers on the Parliament exclusive power to make laws "with respect to ... all places acquired by the Commonwealth for public purposes". In Worthing, Menzies J said of s 52 [81]:

"[I]t is a grant of legislative power for the Commonwealth, and the limits of that grant measure the denial of power to the Parliaments of the State".

A State law only falls foul of s 52(i) if it can properly be described as a law with respect to a Commonwealth place. If it can be so described, it can have no valid operation in the particular Commonwealth place where its operation is challenged. It is clear that a law "can possess more than one character in the sense that it can properly be characterized as a law with respect to more than one subject-matter"[82]. But if a State law can be characterised as a law with respect to a Commonwealth place, it will not avoid contravention of s 52(i) because it is also a law with respect to other places or other matters. It is still in contravention of the exclusive power of the Parliament with respect to that Commonwealth place.

It is not in issue that the Commonwealth acquired the airport for public purposes. Although Kitto J was in dissent in Worthing, I do not think that the following passage from his Honour's judgment is at odds with the views of the majority[83]:

"The natural sense of [s 52(i)] seems to me to show that the 'places' to which it refers are lands in respect of which the Commonwealth has acquired proprietary rights under the laws of the State ... in which they are situated. The word 'places' I take to be used instead of 'lands' because the concept of a 'place' is that of a location or site for a purpose - here, a site for the furtherance of public purposes of the Commonwealth."

The grant of exclusive legislative power does not involve any transfer of territorial sovereignty from a State to the Commonwealth when land is acquired by the Commonwealth for public purposes[84]. The question is "the effect in the constitutional distribution of legislative power of the grant of exclusive power to make laws as provided by s 52(i)"[85]. The particular question here is whether the relevant provisions of the Act constitute a law with respect to Melbourne (Tullamarine) Airport.

The respondent, supported by the States of New South Wales, South Australia and Western Australia, submitted that the relevant provisions of the Act, properly understood, constitute a law with respect to stamp duty on instruments, not a law with respect to Commonwealth places. The appellant, supported by the Commonwealth, argued that the legislation was relevantly a law with respect to instruments which create an interest in land and so, in the circumstances, inevitably was a law with respect to Commonwealth places.

As a means of resolving these conflicting submissions, counsel for the appellant suggested that a useful test is to ask whether, if the Parliament enacted a law similar to the State law under attack, such a law would be valid in its application to the airport. A positive answer would mean that the State law was invalid as intruding into the exclusive power of the Commonwealth. There is, I suggest, some artificiality with this approach. The Parliament may legislate with respect to federal airports. And it may do so by express reference to federal airports or by embracing them in some wider description of Commonwealth places. But to say this is to do little more than state the obvious, namely, that the Parliament may make laws with respect to Commonwealth places. Its power in that respect is extensive, subject to any express or implied restrictions in the Constitution. Nevertheless any law relying upon that power must answer the description of a law with respect to Commonwealth places. At the same time, absent a head of power in s 51, the Parliament cannot legislate on a particular subject simply because the statute might have some operation in a Commonwealth place. The phrase "with respect to" Commonwealth places remains the governing consideration, however the matter is approached. In any event, the denial of power to which Menzies J referred in Worthing does not depend upon the existence of a law of the Parliament made pursuant to s 52.

The respondent pointed to decisions of this Court which have emphasised that stamp duty is charged upon an instrument, not upon the transaction to which the instrument relates. The most recent decision of the Court to this effect is Commissioner of Stamps v Telegraph Investment Co Pty Ltd[86]. In their reasons for judgment in the present matter McHugh, Gummow and Kirby JJ say that the characterisation of the Act, for the purposes of s 52(i), "is not concluded by the adoption of slogans which derive from the fact that stamping attaches to instruments". I agree, but the proposition that stamp duty attaches to instruments can hardly be dismissed as a slogan. It is a proposition of law. There is a useful reminder of its significance in the judgment of Barwick CJ in Associated Steamships Pty Ltd v Western Australia[87]:

" A stamp duty upon an instrument is, in my opinion, essentially a tax upon the creation of the instrument. ... Thus, as it seems to me, viewed as a tax upon an activity, the stamp duty on such an instrument is a tax upon the creation of the document. It is not a tax upon the property the subject matter of the instrument or upon the activity out of which the decision to create the document arose."

The matter was put succinctly by Mason J in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) when he said[88]:

" It is a fundamental principle of the law relating to stamp duties that duty is levied on instruments, not on the underlying transactions to which they give effect".

The Act itself accepts this approach by providing in s 17(1) that "there shall be charged ... upon the several instruments specified in the [Third] Schedule the several duties and additional duties therein specified".

The proposition is one which has important legal consequences. Davidson v Chirnside[89], which held that whether an instrument was within the Stamps Act 1892 (Vic) must be determined by the instrument itself and not upon extrinsic evidence, is illustrative in that regard.

Is this a law with respect to a Commonwealth place?

One still has to ask the question: is the impugned law one with respect to a Commonwealth place? Is it a law, having as its subject-matter a Commonwealth place[90]? If it is, it is beyond the power of the State legislature, not as a matter of inconsistency under s 109 of the Constitution, but because, to that extent, s 52(i) denies legislative power to the Parliament of the State.

Worthing itself was concerned with a regulation made pursuant to the Scaffolding and Lifts Act 1912 (NSW). The regulation was under a general heading: "Safeguards and Measures to be Taken for Securing the Safety and Health of Persons Engaged in Building Work". By majority, the Court held that the regulation did not extend to the Royal Australian Air Force base at Richmond. Barwick CJ said[91]:

"[A] law regulating conduct in a place is ... a law with respect to that place within the meaning of s 52 of the Constitution. It would ... be none the less so if the law were not confined to the regulation of conduct at that place but extended as well to the regulation of conduct in other places acquired by the Commonwealth".

In Phillips92 Barwick CJ repeated the test by reference to laws which "regulate or control the conduct of persons in the place acquired". The reference to conduct in a place gives due recognition to the idea of location for a purpose which the provision conjures up.

There is learning of this Court as to the meaning of "with respect to" in a constitutional context. In Worthing Kitto J said that the meaning of the expression as it appears in s 51 of the Constitution [93]

"has been expounded often in this Court. It refers to such a direct and substantial connexion between a law and a specified topic that the law is in point of character a law on that topic".

His Honour went on to say that to justify giving the expression as used in s 52 a different meaning "would surely be too formidable a task". It is true as already noted that Kitto J was, as to the result, in dissent in Worthing. But the passage quoted retains its value as to the approach to be taken. It accords with the approach to s 51 taken by the majority in Re Dingjan; Ex parte Wagner94.

In Bank of NSW v The Commonwealth Latham CJ stated[95]:

"A power to make laws with respect to a subject matter is a power to make laws which in reality and substance are laws upon the subject matter. It is not enough that a law should refer to the subject matter or apply to the subject matter".

It follows that merely because a State law purports to have some operation relevant to a Commonwealth place does not constitute it a law with respect to that place. To hold that it does is to give insufficient weight to the connexion required between a law and its subject-matter. In particular, there is a failure to focus on the degree to which, if at all, the State law regulates conduct in the place acquired by the Commonwealth.

The respondent argued that no sufficient connexion exists between the place and the subject-matter of the power merely because the transaction said to attract duty has some connexion with a federal airport. He further contended that any connexion between the application of the law and the Commonwealth place must be more than incidental; it must be relevant to the way in which the law operates and its effect on the place. The argument is persuasive.

Harper J, at first instance, thought that any connexion between the relevant provisions of the Act and Melbourne (Tullamarine) Airport was not direct or substantial. His Honour said[96]:

"[T]he tax exacted by a law imposing stamp duty on instruments of lease does not attach to conduct, except in so far as the creation of the instrument is the consequence of the conduct of the parties to it. ... It is with the instrument that the tax has a direct and substantial connection ... It does not ... have a direct and substantial connection with land ... It does not impinge upon what is done on land, except to the extent that an instrument being an instrument of lease is involved."

The contrary argument is that the relevant provisions of the Act are a law with respect to the airport because the duty imposed by the Act on a lease of airport premises is calculated by reference to particular characteristics of the land in question which affect the rent payable and hence the amount of stamp duty. Duty is assessed on an ad valorem basis[97]. The stamp duty upon a lease is payable by the lessee[98]. In the case of "a lease for a definite term of not less than twelve months which provides for payment of rent all or part of which cannot be ascertained at the time the lease is executed", s 83A provides the machinery by which the rent is ascertained and duty is payable accordingly. The lease in question answers the description in s 83A.

But the relevant provisions of the Act are not concerned with places. Unlike the legislative and regulatory provisions under consideration in Worthing and later decisions, they do not regulate conduct or activities on places. They do not tax transactions nor are they a tax upon property. They have no particular connexion with places except in the tenuous sense that an instrument of lease the subject of stamp duty is necessarily a lease of land, in this case of land within the airport.

Support for this conclusion is found in Bevelon Investments Pty Ltd v Melbourne City Council99. Bevelon Investments concerned the rateability under the Local Government Act 1958 (Vic) of floors of a building in Melbourne held by the Commonwealth under a lease for a term of five years. This Court held unanimously that the rating provision did not contravene s 52(i). Three of the Justices, Gibbs, Jacobs and Murphy JJ, in separate judgments, held this to be so on the ground that by leasing part of the building the Commonwealth had not acquired a place within s 52(i). However Barwick CJ, and Stephen and Mason JJ in a separate joint judgment, held that there was no contravention of the Constitution because the rating provision was not a law about the premises occupied by the Commonwealth. Rather it was a law imposing a liability to pay rates upon the owner of the rateable property if the occupier was the Crown in right of the Commonwealth. Barwick CJ expressed his opinion in the following way[100]:

"Section 267 is not, in my opinion, a law about the premises occupied by the Commonwealth. It is a law, as it affects to be, imposing a liability to pay rates upon the owner of the ratable property. ... such a law is not upon the subject matter of the premises subject to the lease, but is upon the subject of rating ratable property, which ... by reason of s 3 of the Acts Interpretation Act and s 114 of the Constitution, cannot include any property of the Commonwealth."

Stephen and Mason JJ said[101] that "the levy is imposed not in respect of the tenancy or interest of the occupier but in respect of the annual value of the ratable property to the owner".

The decision in Bevelon Investments is a useful guide because liability for general rates was imposed upon the occupier of property or, if the occupier was the Crown in right of the Commonwealth of Australia, then upon the owner of the property. Hence the difficulty of showing that the law in question was a law with respect to a place.

Clause 8.26(h) of the lease to the appellant requires that the lease be unregistered. The Transfer of Land Act 1958 (Vic) contains provisions relating to the registration of dealings with estates and interests in land and also to the consequences of non-registration. In Breskvar v Wall102 Barwick CJ observed:

" The Torrens system of registered title ... is not a system of registration of title but a system of title by registration."

That statement may perhaps be described as a "slogan"; it nevertheless points to an important truth about the Torrens system. The point does not arise in this appeal but the appellant's argument would seem to entail a conclusion that in the case of dealings with estates and interests in land within a federal airport, the Transfer of Land Act is a law with respect to a Commonwealth place and to that extent Victoria is denied legislative power, save through the Commonwealth Places (Application of Laws) Act 1970 (Cth). Even then, s 4(2) of that Act may present an obstacle[103].

The connexion of those provisions of the Act which impose duty upon an instrument of lease with the Melbourne (Tullamarine) Airport is neither direct nor substantial. They do not regulate conduct in or in relation to a federal airport, they do not prohibit activities within the airport or control the performance of any such activities. They constitute in point of character a law on the topic of stamp duty on instruments.

I would dismiss the appeal from the decision of the Supreme Court of Victoria.

GAUDRON J. The facts and the relevant legislative and constitutional provisions are set out in the joint judgment of McHugh, Gummow and Kirby JJ.

As appears from their Honours' judgment, the respondent and the intervening States of New South Wales, South Australia and Western Australia were refused leave to re-open the decisions in Worthing v Rowell and Muston Pty Ltd[104] and subsequent cases concerned with s 52(i) of the Constitution [105]. That being so, s 52(i) must, in my view, be approached in this case on the basis that it is primarily a grant of legislative power and not, as I suggested in Svikart v Stewart[106], a provision which is primarily concerned with the exclusivity of powers found elsewhere in the Constitution.

On the basis that s 52(i) of the Constitution is primarily a grant of legislative power, it follows, for the reasons given by McHugh, Gummow and Kirby JJ, that the provisions of the Stamps Act 1958 (Vic) do not impose any duty upon the lease of the premises occupied by the appellant within Melbourne (Tullamarine) Airport.

McHUGH, GUMMOW AND KIRBY JJ. The question in issue is whether stamp duty under State legislation applies to an instrument of lease executed in respect of part of a federal airport intended for use as a duty free store.

The resolution of that question has taken the Court to a consideration of its past authority in Worthing v Rowell and Muston Pty Ltd[107] as elaborated and applied by later decisions[108]. A large amount of stamp duty (nearly $800,000) is said to be at stake. From the point of view of the parties the appeal affects highly practical concerns, potentially with large implications for State revenue. For these reasons, the Commonwealth and the States of New South Wales, South Australia and Western Australia intervened. The Commonwealth supported the immunity from stamp duty claimed by the appellant. The States supported the applicability of the duty asserted by the Victorian Comptroller of Stamps ("the respondent").

On 7 September 1961, pursuant to s 6 of the Lands Acquisition Act 1955 (Cth), the Commonwealth of Australia acquired a large portion of land outside Melbourne for the public purpose of the development and use of an airport known as Melbourne (Tullamarine) Airport.

The land so acquired, constituting the airport, was later included in the Schedule to the Federal Airports Corporation Act 1986 (Cth). By virtue of s 23(2) of that Act, the land became a "Federal airport" on the "transfer day", ie 1 January 1988[109]. Pursuant to s 32 of that Act, the buildings, fixtures and other assets previously owned by the Commonwealth, which were used at, or in relation to, the airport, were thereupon transferred to the Federal Airports Corporation ("the Corporation"). By virtue of s 28(1) of that Act, land owned by the Commonwealth which became a "Federal airport" was vested in the Corporation without any conveyance, transfer or assignment. However, by s 29(1) it was provided:

" While a place owned by the Corporation is a Federal airport or part of a Federal airport, that place is held by the Corporation for or on behalf of the Commonwealth."

The explanatory memorandum which accompanied the Bill which became the Federal Airports Corporation Act stated, of this provision, that it was intended to retain "the status of Commonwealth places in terms of s 52(i) of the Constitution in respect of the Corporation's airports".

Allders International Pty Ltd ("the appellant") is a private corporation which is neither a subsidiary nor a partner of the Corporation. It conducts its business of operating duty free stores at airports in premises near to the passenger departure and arrival areas. Relevant customs legislation provides for the licensing of the proprietor of a duty free store, the obligations as to the sales effected and the restrictions imposed upon what may be sold[110]. Notice may be taken of the fact that the conduct of such businesses at airports servicing international air passengers is now virtually a universal feature of such airports in Australia and common to airports around the world.

On 1 December 1990 the appellant occupied certain premises situated within Melbourne (Tullamarine) Airport. It did so pursuant to a lease granted by the Corporation. The term of the lease was 18 months. The instrument of lease was submitted to the respondent for stamping at nominal duty. Under s 137P of the Stamps Act 1958 (Vic), a deed of any kind whatever, not otherwise chargeable with duty, is liable for nominal duty[111]. The respondent duly stamped the instrument of lease at nominal duty. Following the expiry of the initial lease, and an unexplained interval, a further lease was executed by the Corporation in favour of the appellant on 17 June 1993, to commence on 1 November 1992. It specified a term of eight years expiring on 31 October 2000. It appears to have been contemplated that the lease would be unregistered[112]. Pursuant to the Transfer of Land Act 1958 (Vic) ("the Transfer of Land Act"), s 40, no instrument, until registered, is effective to create, vary, extinguish or pass any estate or interest or encumbrance in or over any land. By s 66(1) of the same Act, the registered proprietor of freehold land may lease it for any term exceeding three years by an instrument in the approved form. The power of the Corporation to grant the lease in question is found in s 9(2)(b) of the Federal Airports Corporation Act. The validity of the lease was not impugned.

It is unnecessary for the purposes of this case to determine whether the instrument, by reason of the absence of registration under the Transfer of Land Act, failed to create a leasehold estate. If that were so, the instrument nevertheless would have taken effect as an agreement for lease in accordance with the principles explained in Chan v Cresdon Pty Ltd[113].

Clause 6.36 makes provision for the payment of stamp duty. It obliges the appellant:

"To pay all stamp duty if any including any fines or penalties in connection with the stamping of this Agreement and counterpart. In the event that the Corporation arranges for the lodgement of such documents for assessment of duty the Concessionaire is to pay such duty within 7 days of notification of any such assessment."

Nothing turns on this obligation because, by the lease, the parties expressly reserved the question of whether, in law, any duty was payable.

When, on this occasion, the appellant presented the new instrument of lease for stamping at nominal duty, the respondent insisted that it was fully dutiable under the provisions of the Stamps Act. There was thus presented the constitutional question now before this Court.

The appellant contended that the premises, the subject of the lease, were wholly within a Commonwealth place. It invoked s 52 of the Constitution which states:

" The Parliament shall, subject to this Constitution, have exclusive power to make laws for the peace, order, and good government of the Commonwealth with respect to -

(i) The seat of government of the Commonwealth, and all places acquired by the Commonwealth for public purposes:

(ii) Matters relating to any department of the public service the control of which is by this Constitution transferred to the Executive Government of the Commonwealth:

(iii) Other matters declared by this Constitution to be within the exclusive power of the Parliament."

Upon this basis, the appellant argued that the Stamps Act could not validly operate so as to impose any duty upon a lease in respect of the premises. In so far as the Parliament, by the Commonwealth Places (Application of Laws) Act 1970 (Cth) which followed the Worthing[114] decision, had applied State law to a Commonwealth place, such as the Melbourne (Tullamarine) Airport[115], it had exempted any law which had "effect so as to impose any tax"[116]. Stamp duty was such a tax. Accordingly, it was excluded. The Constitution withdrew from the Victorian Parliament any legislative power with respect to a place acquired by the Commonwealth, such as the airport[117]. The power to make laws with respect to such a place was reserved exclusively to the federal Parliament. Such laws as had been enacted for that purpose by the Parliament made it plain that an Act such as the Stamps Act did not apply. The instrument of lease in question was therefore not dutiable at all. Its presentation for stamping at nominal duty was an unnecessary, although practical and understandable, measure to avoid the kind of litigation which has now arisen.

The respondent contended that the Stamps Act was not a law with respect to a Commonwealth place. This argument was advanced on the footing that the proper characterisation of the Stamps Act, for the constitutional purpose in question, was that it was a measure of general operation with respect to the imposition of stamp duty on instruments. Properly analysed, the stamp duty was not levied upon the underlying transaction; or the property the subject-matter of the instrument; or activity out of which the decision to create the document arose in the first place. Historically, stamp duty has been regarded as a charge upon instruments[118]. So with the Stamps Act. The instrument in question had been executed in New South Wales. But the evidence showed that the lease had been brought into Victoria and submitted to the respondent for stamping in Victoria. For the respondent this, and the location of the premises in question in Victoria, provided sufficient statutory[119] and constitutional nexus to sustain the attachment of the Stamps Act. Properly analysed, it was a statute about instruments, not places, still less Commonwealth places.

The dispute between the parties originally came for hearing before the Supreme Court of Victoria. The appellant claimed declarations that the lease was not dutiable under the Stamps Act. Various other declarations and orders were also claimed. Harper J dismissed the appellant's claims. He concluded that the Stamps Act was not a law with respect to the "land itself", ie the Commonwealth place[120]:

"Once one has a substantial and direct connection with real estate, one can discern, in so far as that law has application to a lease of a Commonwealth place, that it is a law with respect to that place.

I confess that my powers of discernment do not stretch this far. The 'direct and substantial connection' put forward by the plaintiff is in fact, it seems to me, indirect and insubstantial. Stamp duty is in truth a tax not upon transactions but upon instruments."

The appellant's claim for relief thus failed upon the characterisation of the Stamps Act which Harper J considered to be applicable. An appeal was lodged. Before the appeal could be heard in the Court of Appeal of the Supreme Court of Victoria, the whole of the cause pending was removed into this Court pursuant to s 40(1) of the Judiciary Act 1903 (Cth).

The notices given by the parties under s 78B of the Judiciary Act, concerning the constitutional matters which they wished to argue, have taken the issues before this Court beyond those determined by Harper J.

The appellant advanced an alternative basis for refuting the application of the Stamps Act to its instrument of lease. This had been indirectly mentioned in its process in the Supreme Court of Victoria[121] but was not apparently argued. It was that, on a proper analysis of the Federal Airports Corporation Act, the Commonwealth Places (Application of Laws) Act, the Customs Act, the Customs Tariff Act 1987 (Cth) and the Customs Regulations, it was sufficiently shown that the incidents of its occupation of the subject airport premises were governed by federal law such that, if the Stamps Act of Victoria purported to impose stamp duty on the instrument of lease in question it was, to that extent, invalid in terms of s 109 of the Constitution, being inconsistent with laws of the Commonwealth.

The respondent added an argument that, the subject premises having been leased by the Corporation to the appellant, they had ceased to be a Commonwealth place and thus within the "enclave" of exclusive federal legislative power.

Neither party raised any procedural objection to these additional arguments. As they are legal in character and could not be affected by evidence, they may be entertained without procedural unfairness[122].

At the threshold, the respondent sought to challenge the correctness of the decisions of the Court in Worthing and the subsequent decisions relying upon it. It was this endeavour which led the Court into a preliminary review of its authority on the meaning and application of s 52(i) of the Constitution.

Two additional constitutional questions were mentioned during argument but not pressed, being outside the notices given. We mention them only for completeness. They were:

1. Whether the prohibition in s 114 of the Constitution [123] applies to prohibit the Parliament of the State of Victoria imposing "any tax on property" belonging to the Commonwealth. Questions might arise as to whether the Stamps Act had that effect; whether the duty in question was "on property"; and whether the property belonged to the Commonwealth or to the Corporation, which the Court was told was the registered proprietor of the subject land.

2. Whether the duty asserted under the Stamps Act was an attempt by a State Parliament to impose a tax on the Commonwealth or one of its instrumentalities and as such constitutionally impermissible[124].

Before the decision of this Court in Worthing[125] a controversy existed as to the proper operation and meaning of s 52(i) of the Constitution. Apart from a divided decision of the Full Court of the Supreme Court of New South Wales in R v Bamford[126], decided in the first year of the Commonwealth, there was little judicial authority on s 52(i). Dicta in this Court pointed in opposite directions[127]. The early text-writers on the Constitution also showed a certain ambivalence, or at least the development of different opinions[128]. In an influential essay written shortly before Worthing was decided, Professor Zelman Cowen identified no fewer than five possible approaches to the operation of s 52(i)[129]. These were:

(a) That land in a place acquired by the Commonwealth is to be regarded as excised from a State so that the sole source of authority is federal.

(b) That such land remains within a State, with State laws preserved to the extent provided by s 108 of the Constitution but not subsequent amendments or enactments which would conflict with the exclusive character of the legislative power granted to the federal Parliament.

(c) That s 52(i) merely authorises legislation with respect to Commonwealth places as places and otherwise State laws continue to operate within such `federal enclaves' subject only to s 109 of the Constitution.

(d) That the places referred to are the territories of the Commonwealth, there being no legislative power in respect of land acquired save those provided by ss 51(xxxi) and 85 of the Constitution.

(e) That the only State laws which infringe s 52(i) are those which are specifically targeted at places acquired by the Commonwealth.

As the reasons of the Justices who participated in Worthing demonstrate, there are persuasive considerations to support at least a number of the foregoing approaches. But in the end, the options competing for acceptance before the Court in Worthing narrowed to two.

The first (in which Barwick CJ, Menzies and Windeyer JJ and, with a slight variation, Walsh J joined) would hold that, after the acquisition by the Commonwealth for public purposes of a place within the boundaries of a State, s 52(i) excluded the power of the State Parliament, even by a law of general application, to regulate the conduct of persons engaged in activity in the acquired place. The holding of the majority in Worthing subsequently has been identified as being that s 52(i) gives to the federal Parliament an exclusive power to legislate "generally with respect to places of the kind referred to in that provision"[130]. Walsh J based his concurrence in this view upon the opinion that the federal Parliament's exclusive power was to make laws with respect to such places but that any such laws had to enjoy a direct and substantial connection with the place as, he concluded, the law there in question did.

The alternative opinion (in which the dissentients McTiernan, Kitto and Owen JJ agreed) was that s 52(i) did not afford legislative power beyond that elsewhere conferred upon the federal Parliament but that, if it did, the only law-making power denied to the States was "with respect to" the Commonwealth place, as such. A law of general application, not being susceptible to such a characterisation, would thus continue to apply to the Commonwealth place, so avoiding the "serious complications"[131], practical problems[132] and risk of a "state of anarchy"[133] in a law-free Commonwealth place which could never have been intended by the Constitution. According to the proponents of the alternative view, the majority interpretation was negated both by the structure and purpose of the Constitution and by the inclusion in s 52(i) of the clear instruction that its "exclusive" operation was to apply "subject to this Constitution", with its acknowledgment of a polity having federal and State components.

A reading of the opinions in Worthing will demonstrate both the finely balanced character of the arguments advanced by the parties and the difficulty of resolving the debate in a way that was entirely satisfactory. Each solution had problems, acknowledged clearly in the reasoning of Windeyer J. His Honour candidly admitted that he had changed his mind from the opinion held during argument[134].

Amongst the arguments which tend to sustain the correctness of the conclusion reached by the majority in Worthing are:

(1) The grant of power is expressed in language which is typically that of a grant of legislative power[135]. Such a grant should conventionally receive a broad construction and not one that narrows its operation.

(2) The power is provided in the Constitution and so must enjoy a broad and general construction appropriate to this context and to the achievement of its purposes[136].

(3) The power is additional to the specific heads of legislative power appearing in s 51 which would already have sustained a broad legislative mandate with respect to the subject-matter of the acquisition of property for Commonwealth purposes[137]. The exclusive character of the power thus conferred must be contrasted with what would otherwise have been the concurrent powers enjoyed under s 51, reliant on s 109 to oust inconsistent State laws.

(4) The power is to be understood against the background of the United States constitutional provisions which it was intended at once to mirror and to enlarge[138].

(5) The power is to be understood, and its exclusive character appreciated, in the context of the other subject areas in respect of which exclusive legislative power is conferred by s 52, notably, laws with respect to the seat of government, the federal public service and other matters declared to be within the exclusive power of the federal Parliament for which the application of State laws would be highly inconvenient, disruptive and potentially confusing. The legislative power with respect to Commonwealth places appears to be "of the same order" as the exclusive legislative power with respect to those other subject-matters[139].

(6) Full meaning must also be given to the word "exclusive" in s 52(i). The question has rarely, if ever, been what power is given to the Commonwealth. Typically, it has been what power is thereby denied to a State[140]. The extent of that denial is measured by the grant of legislative power to the federal Parliament which is "exclusive"[141]. If the federal Parliament has exclusive legislative power it follows that the State Parliament has no legislative power[142].

(7) The suggested inconvenience and even "anarchy" of federal "enclaves" (a word Windeyer J criticised[143]) should not be exaggerated. Just as this potential difficulty was earlier solved in the United States by assimilation legislation, so it could be (and was) solved in Australia by the Commonwealth Places (Application of Laws) Act[144]. On this basis the "alarm" was "needless"[145]. The problem was easily remediable[146]. It did not suggest a defect of constitutional appreciation. Instead, the legislative remedy merely gave effect to the clear language used in s 52(i).

(8) This did not leave the exclusive domain of federal legislative power either undefined or unlimited. So far as places acquired by the Commonwealth for "public purposes" are concerned, the boundary of the exclusive legislative power is fixed by the application of the test requiring characterisation of the impugned State law and consideration of whether it is a law "with respect to" the place. Various formulae have been offered to help the decision-maker in the application of those words to a law in question[147]. A "substantial" or "sufficient" connection is needed[148], based upon a consideration of the actual legal effect or operation of the impugned law and not just to its terms or to legal theory[149]. Walsh J in Worthing suggested that a law would intrude into the exclusive legislative domain of the federal Parliament if it was "directly and closely connected"[150] or directly and substantially connected[151] with the Commonwealth place. Windeyer J lamented the "uncouth" word "characterisation", describing it as part of the "jargon" of Australian constitutional law[152]. Yet however verbalised, the task cannot be escaped in the case of a challenge such as the present. It is not answered by pointing to the title of the law, to established legal metaphors or to some only of the law's provisions. If the State law, properly characterised, is "with respect to" a Commonwealth place, then it invades the exclusive legislative domain reserved to the federal Parliament. To that extent, it is beyond the legislative competence of the State Parliament. It is invalid in its suggested application to the Commonwealth place.

The respondent (and the intervening States) attacked this analysis of s 52(i), suggesting that the Court in Worthing and later cases had taken a "wrong turn". They invoked what they took to be a number of recent hints discerned in obiter remarks which were read as doubting the correctness of Worthing[153]. They urged that the time had come for a restoration of the historically correct, and legally accurate, view of s 52(i) expressed in the minority opinions in Worthing and in other minority views since. Amongst the principal arguments relied upon to establish the incorrectness of the majority opinion in Worthing were the following:

(1) Worthing is inconsistent with the original approach of the Court to this issue[154] and amounted, in effect, to the application by the majority of the dissenting opinion of Isaacs J in Pirrie v McFarlane[155]. It is time to return to the "true doctrine".

(2) The basic flaw of the reasoning in Worthing is the failure to accord proper attention to the phrase "subject to this Constitution". That phrase makes it clear that any power granted by s 52 to the federal Parliament is to be construed as subject to a constitution which is federal in character and which created a polity with States which were intended to possess an effective and general law-making power unless ousted by valid federal laws.

(3) In this context, the notion of potentially law-free "enclaves", constituted by Commonwealth places is completely antithetical to the overall design of the Constitution and the polity which it called into existence. Section 52(i) must therefore mean something else. Its meaning has to be derived from its own terms. It could not be dependent upon assimilative legislation such as the Commonwealth Places (Application of Laws) Act.

(4) The inconvenient result of ousting State laws from Commonwealth places, which might be extremely small, surrounded by the territory of a State and for some legal purposes still part of that territory[156], could readily be avoided by the simple technique of giving proper meaning to each of the key expressions in s 52(i). Most importantly, it would involve focussing attention on limiting any grant of legislative power to the federal Parliament to the making of laws with respect to places acquired by the Commonwealth, as places[157].

(5) To treat a Commonwealth place, which may be no more than a strata title in a city office block, as a "federal enclave", and to reserve plenary legislative power there to the federal Parliament was to confuse the distinction drawn by the Constitution itself between a federal territory[158], where such plenary power was apt, and a Commonwealth place acquired for public purposes, where it was not. The distinction is signalled by the text of the Constitution itself whereby s 52 is expressed to be "subject to this Constitution" whereas s 122 is not so limited.

(6) Before Worthing, the foregoing view was that which enjoyed not only the authority of the Court but also the favour of many of the commentators[159]. Commentators who have written since Worthing have been critical of its holding[160].

(7) The fundamental fallacy of the majority approach in Worthing was this. It is one thing to hold that a State law of general application may nonetheless have, as one of its characters, that it is a law with respect to a place which happens to be a Commonwealth place. It does not follow, because such a State law of general application touches, in some practical way, such a place, that it is a law "with respect to" that place. The solution to avoiding the consequences of Worthing, which were said to be so incompatible with the intended operation of s 52(i) in the context of the Constitution as a whole, was to return to assigning appropriate attention to the characterisation of the State law in question. If, although it in some ways impinged upon the Commonwealth place and those in it, the State law was not, as such, a law "with respect to" that place, it would not invade the exclusive domain of federal legislative power. It would merely have its ordinary operation, according to its terms. This approach would reconcile s 52(i) with the overall design of the Constitution. It would avoid the absurdity of tiny federal enclaves which could never have been the intended meaning of s 52(i).

In Evda Nominees Pty Ltd v Victoria[161], this Court affirmed, by majority[162] that, although it is not bound by its own earlier decisions, it will not hear full argument on every occasion when a party wishes to contend that a previous case was wrongly decided. The Court established a procedure whereby a party, wishing to challenge as wrong a past decision, should seek leave of the Court to do so. In dissent, Deane J[163] concluded that a party does not require leave to raise in argument any legal proposition, including a proposition that a past decision was wrong and should not be followed.

The procedural convention established in Evda was not disputed by any party in the present matter. The procedure was applied by the Court in this case. The respondent and the interveners sought leave to reargue Worthing. At the end of argument on this preliminary point, Brennan CJ announced, on behalf of the Court, that such leave was refused. In light of the refusal of leave we will refrain, in this case, from repeating the arguments of the parties or expressing our views upon them.

Section 52(i) gives to the federal Parliament an exclusive power to legislate generally with respect to places of the kind referred to in that provision. The words of s 52(i) are clearly expressed in terms of a grant of legislative power to the federal Parliament. The "exclusive" character of that grant is expressly stated. It cannot be diminished for alleged reasons of convenience. It is unconvincing to suggest that the phrase "with respect to" in this grant of power is to be given a different and narrower field of operation than that given to the same words in the immediately preceding section (s 51). For compelling reasons, it is now clear that the power is not confined, as Higgins J thought, to operation in the federal territories[164]. It is equally clear that the power is not confined to the making of laws for "all" territories but only upon matters in common to all territories[165]. The view that it is confined to the making of laws for Commonwealth places, as places, has been rejected[166]. Whereas Worthing was concerned with a State law enacted after the place in question had been acquired, Phillips[167] was concerned with a State law enacted before the acquisition. The result was the same. From the date of the acquisition the only laws that may be enacted by a legislature with respect to the place are federal, for this portion of the legislative power is, by s 52(i), reserved exclusively to the federal Parliament[168]. The language of the Constitution requires this result. The history of the provision and of its United States progenitor supports it. The overall scheme of the Constitution is compatible with it.

That conclusion leaves three arguments of the respondent open to consideration. It is appropriate first to deal with the question whether, by reason of the terms of the legislative grant by the Commonwealth to the Corporation, and the lease by that Corporation to the appellant, the premises leased to the appellant in the airport complex ceased to be a place "acquired by the Commonwealth for public purposes". An affirmative conclusion on this argument would remove the suggested impediment of s 52(i) of the Constitution to the application of the Stamps Act, although it would leave the respondent to run the gauntlet of the suggested inconsistency between that Act and the several federal laws pursuant to which the lease was granted.

The respondent's argument under this head was put in the alternative. First, it was said that the operation of a duty free store is not the kind of public purpose to which s 52(i) was intended to apply. Alternatively, it was argued that, if originally the airport, in its entirety, was acquired for a public purpose, those parts of it leased to the appellant for use as a commercial duty free store lost that character and were thus removed from the exclusive federal domain of s 52(i). Neither of these arguments has merit.

In the first place, as a matter of fact, it seems scarcely arguable that a duty free store which is now so conventional, even universal, a feature of international airports, is not within the "public purposes" of use of the place as an airport. A glance at the statutory preconditions imposed upon those licensed to conduct such facilities indicates an obligation to provide services to passengers using the airport[169]. The lease to the appellant calculates the rent to be paid by it for the premises by reference to criteria (including "passenger spend rate departures" and "passenger spend rate arrivals") which plainly take into account the passenger usage of the place incidental to its use for the public purpose for which it was acquired[170]. In any case, the determination of the character of the purpose is to be made at the time of the acquisition. In the present case, there can be no dispute that the entire place, being the Melbourne (Tullamarine) Airport, was acquired for public purposes. It does not become less so because, subsequently, part of it is devoted to a private purpose incidental to the public purpose for which it was acquired.

As to the second argument, it is true that dicta have suggested that the exclusive power conferred by s 52(i) of the Constitution endures only so long as the places acquired by the Commonwealth for public purposes remain in the ownership or possession of the Commonwealth[171]. Furthermore, it has been suggested that there must be some permanence about the acquisition, in order that activities such as the use of polling booths during a federal election would not attract the operation of the section[172]. Short-term leases may also not attract its operation[173]. However that may be, the place which was acquired here was the entire Melbourne (Tullamarine) Airport. It remains so acquired. Although the title to the land has passed from the Commonwealth to the Corporation without conveyance[174], the Corporation holds the land "for and on behalf of the Commonwealth"[175]. Such a statutory title is sui generis. In our view it achieves the stated purpose of the drafter. The entire airport remains a Commonwealth place. It does not cease to be such by lease of part of it by the Corporation for a purpose incidental to the purpose of the acquisition. This conclusion can be tested in the way suggested by Gibbs J in Bevelon Investments Pty Ltd v Melbourne City Council[176]. Consider the inconvenience which would follow if uncertainty existed as to the laws applicable to the place in question. That could not have been the intended operation of the constitutional provision. Once "acquired" for public purposes, so long as the place remains in the ownership or possession of the Commonwealth, it is subject to the exclusive legislative power provided by s 52 of the Constitution. The first argument of the respondent thus fails.

Most of the respondent's arguments (supported by the States) were addressed to the suggestion which convinced Harper J that the proper characterisation of the Stamps Act was that it was not a law with respect to a place at all but a law with respect to instruments.

It is trite law that stamp duty is charged upon an instrument, not upon the property, transaction or activity that is referred to in the instrument[177]. This well-known principle has been restated many times in this Court, including recently[178]. For duty to be attracted to the instrument it is typically unnecessary to show that the latter is capable of specific performance[179] or even that property has passed, whether in law or equity[180]. Viewed in this light, the respondent argued, the Stamps Act of Victoria was not a law with respect to a place at all. It did not affect the place or the activities happening within the place. It concerned only the instrument of lease. This Court, for the purposes of its characterisation of the Stamps Act should adhere to the time-honoured principle concerning the character of a stamp duty law.

In our view the characterisation of the Stamps Act, for the purposes of s 52(i) of the Constitution, is not concluded by the adoption of slogans which derive from the fact that stamping attaches to instruments. It remains to be decided whether, by a detailed examination of that Act, the law in question purports to regulate conduct in a Commonwealth place. A law may have several characterisations[181]. It may affect both places and instruments. The mere fact that the State law is of general application, and is not limited to operating within the Commonwealth place or specifically targeted at that place, does not necessarily mean that it falls outside a characterisation as a law "with respect to" the place[182].

Allders International Pty Ltd v Commissioner of State Revenue [1996] HCA 58; 186 CLR 630; 71 ALJR 1; 140 ALR 189

At a glance

Court

Decision date

Before

Source

Judgment (360 paragraphs)

Allders International Pty Ltd v Commissioner of State Revenue [1996] HCA 58; 186 CLR 630; 71 ALJR 1; 140 ALR 189 (14 November 1996)

Parties

Legislation Cited (2)

Cases Cited (60)