Halloran v Minister Administering National Parks and Wildlife Act 1974

Halloran v Minister Administering National Parks and Wildlife Act 1974 - [2006] HCA 3 - HCA 2006 case summary — Zoe

[19]

GLEESON CJ, GUMMOW, KIRBY AND HAYNE JJ. The respondent, the Minister administering the National Parks and Wildlife Act 1974 (NSW) ("the Minister"), is an "authority of the State" within the meaning of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ("the Compensation Act"). Section 19 of that statute empowers an authority of the State to acquire land by compulsory process with the effect, given by s 20, that the land vests in the acquiring authority "freed and discharged from all estates, interests, trusts, restrictions, dedications, reservations, easements, rights, charges, rates and contracts in, over or in connection with the land".
Section 37 of the Compensation Act confers upon "[a]n owner of an interest in land" which has been divested, extinguished or diminished by the acquisition, an entitlement to payment by the acquiring authority of compensation. The expression "[a]n owner of an interest in land", as a consequence of definitions in s 4, identifies any person who has "a legal or equitable estate or interest in the land" or "an easement, right, charge, power or privilege over, or in connection with, the land". The appellants assert entitlements to compensation under s 37 of the Compensation Act, which the Minister disputes.
It should be noted that the compulsory acquisition is effected on the date of publication in the New South Wales Government Gazette ("the Gazette") of an acquisition notice (s 20). In February 1997, the Director-General of National Parks and Wildlife had been served with notices requesting acquisition of the land in question in this case. Thereafter, and following urging by the appellants that the matter be expedited, by notices published in the Gazettes of 19 June 1998 and 18 September 1998, there was vested in the Minister by the compulsory processes of the Compensation Act parcels of land totalling about 2,639 hectares. The land was acquired for the Jervis Bay National Park. The situation of the land adjacent to Jervis Bay has the significance that will now be described.

[20]

The resumed land included parcels in various certificates of title issued under the provisions of the Real Property Act 1900 (NSW) ("the RP Act"). There was a large number, said to be several thousands, of parcels of land each of which was a separate lot in a deposited plan. Few, if any, of the lots of a suitable size for development as dwellings have ever been so occupied and the development of the land does not reflect this state of subdivision.
This state of affairs provided the occasion for the transactions to which reference will be made, undertaken with a view to the obtaining for the appellants of a greater measure of compensation on resumption than that which otherwise would have been payable. The reasons for the existence of that state of affairs are found in the history of the Jervis Bay area. The Jervis Bay Territory Acceptance Act 1915 (Cth) ratified and confirmed an agreement between the Commonwealth and the State of New South Wales for the surrender to and acceptance by the Commonwealth of territory to be annexed to, and to form part of, what was then known as the Territory acquired by the Commonwealth for the Seat of Government (s 4)[1]. In the Second Reading Speech in the House of Representatives on the Bill for that statute, the responsible Minister said that the Royal Australian Naval College was already situated within the area in question and that in due course other buildings such as dockyards would be constructed there[2]. It appears that a large tract of land to be retained within New South Wales was subdivided into parcels of a suitable size for town development to support the development of the proposed port in the federal Territory. The anticipated town development did not take place.
It may be noted that, in its form as enacted in 1900, s 113 of the RP Act had provided for the deposit with the Registrar-General of a map showing allotments into which the land for a proposed township was divided. Section 113 was repealed by s 196(12) of the Conveyancing Act 1919 (NSW) ("the Conveyancing Act"). The modern New South Wales system of subdivision and deposited plans was not introduced until 1919[3].

[22]

Talbot J required the appellants (the applicants in that Court) to deliver points of claim that identified the value of the claims they made, the components of the claim, and the basis of the valuations relied on. This was done by dividing the land into a number of different categories and the appellants into three different classes - "bare trustee claimants", "beneficial ownership claimants" and "registered proprietors with beneficial ownership". For present purposes, the categories into which the land was divided may be ignored. Attention must be given to land, of any category, in respect of which the second class of appellants (the "beneficial ownership claimants" or "class 2 claimants" as they were called in the proceedings in the Land and Environment Court) claimed to have a beneficial interest. Pacinette Pty Ltd ("Pacinette") was one of these class 2 claimants.
By consent of the parties, Talbot J ordered, on 27 October 1999, that there be determined, as a separate question, whether Pacinette established, on the evidence led at the hearing of the question, that it is an owner of an equitable interest in three lots the subject of the first of the two notices of acquisition, that which appeared in the Gazette of 19 June 1998. By order made on 9 December 1999 the separate question was answered in the affirmative[7].
The Minister then sought to reagitate that question before Talbot J, at least in so far as it was to be understood as deciding whether other class 2 claimaints had obtained an equitable interest in land the subject of either acquisition. Talbot J declined to permit that to be done, holding that the earlier judgment precluded the Minister from contending that other class 2 claimants had not obtained the equitable interests each claimed[8]. The upshot was that the two proceedings before Talbot J established the entitlement of each class 2 claimant, and all those entitlements have been involved in the subsequent appeals to the Court of Appeal and this Court.

[29]

The second fiscal consideration was the incidence of stamp duty imposed by Div 3A of Pt 3 of the Stamp Duties Act 1920 (NSW) ("the Stamp Duties Act") with respect to the steps taken in May 1998 to vest an equitable interest in the non‑contiguous parcels of land. Division 3A (ss 44‑44F) departs from the traditional form of stamp duty legislation by in substance imposing a duty on transactions rather than instruments. In Chief Commissioner of Stamp Duties v ISPT Pty Ltd[12], Mason P described Div 3A as an anti‑avoidance measure designed to strike at a broad sweep of tax avoidance schemes, some of which had been described in the Second Reading Speech on the Bill for the Stamp Duties (Amendment) Act 1987 (NSW).
Among other situations, Div 3A applies to "a transaction which ... causes or results in a change in the beneficial ownership of an estate or interest in ... land situated in New South Wales" (s 44(1)(a)). However, this reference to a change in beneficial ownership does not include such a change "occurring as the consequence of ... the issue or redemption of units in a unit trust scheme" (s 44(2)(d))[13].
A party to a transaction to which Div 3A applies which is not effected or evidenced by an instrument chargeable with ad valorem duty as, or as on, a conveyance, which that person would have been liable to pay, is obliged by s 44A(1) to lodge a statement with respect to the transaction; this is then deemed to be a chargeable instrument (s 44A(5)).
No unstamped instrument in respect of a transaction to which Div 3A applies but for which there has been no compliance with s 44A shall in non‑criminal proceedings be pleaded or given in evidence for the purpose of proving that a change in the beneficial ownership to which the transaction relates occurred (s 29(3)). Thus, s 29(3) "strikes that instrument with sterility ... unless and until the public requirement of taxation has been complied with"[14].
The sequence of steps taken in May 1998 and their form were designed by the appellants to attract the holding by the majority of the Court of Appeal (Meagher JA and Fitzgerald A‑JA; Mason P dissenting) in ISPT that the particular transaction in issue in that case did not attract duty under Div 3A. However, three points should be made. The first is that, after a detailed analysis of ISPT in the later case of ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue (NSW)[15], Barrett J concluded[16] that he was bound by the Court of Appeal's decision only in so far as it included a decision that the transaction in question there did not engage s 44(1) of the Stamp Duties Act, and that there was no majority view on questions respecting formalities for the creation of trusts and the characteristics of sub‑trusts. The second is that ISPT involved consideration of unit trust deeds but in advance of the decision of this Court in CPT Custodian Pty Ltd v Commissioner of State Revenue[17]. Further reference will be made to CPT later in these reasons. The third is that success of the avoidance scheme implemented in ISPT depended on a matter of timing. As Mason P pointed out[18], it was critical to the taxpayer's argument based on s 44(2)(d) that no change in beneficial ownership occurred until step 7 of the 11 steps listed by him[19]. Hence the importance of sequence.
The purely equitable nature of the interest held by Sealark Pty Ltd ("Sealark") (to which further reference will also be made) further distinguishes the facts of this case from those in ISPT. There, Coles Myer Property Investments Pty Ltd ("CMP") had been the owner of the shopping centres at Forster and Bondi Junction[20]. As such, it was inaccurate to speak of CMP as the owner of a distinct legal and beneficial title or interest; it had the whole right of property in the land[21].
In response to the oral submissions for the appellants in this Court, the Minister submitted that (a) as just remarked, it was difficult to discern any true ratio decidendi in the majority reasons in ISPT, (b) there were material differences between the steps taken in ISPT and those in the present case, particularly with the purported use of an accommodation bill of exchange, (c) the Minister reserved the State's position as to the incidence of stamp duty upon a transaction which differed from the ISPT transaction, and (d) if, as the appellants had contended in oral submissions, there had been a "direct passage" of beneficial ownership from Sealark to Pacinette by what was called the "first event", Div 3A of Pt 3 of the Stamp Duties Act would have applied; in the absence of compliance with s 44A, the "sterilisation" provision of s 29(3) of that statute would bar the admission of any documentary evidence to prove the transaction in the compensation proceedings.
The propositions respecting the Stamp Duties Act upon which the Minister now relies are of a technical legal nature. Talbot J dealt with the admissibility of documents, in the light of Div 3A of Pt 3 of the Stamp Duties Act, in his first judgment, that upon the separate question. His Honour admitted the documents, having regard, in particular, to what appeared to follow from ISPT. There can be no successful objection to the Minister advancing them if, although in play before Talbot J, the stamp duty issues were not pressed in the Court of Appeal.
The appellants referred to a letter dated 25 March 2004, post‑dating the proceedings before Talbot J but received in evidence in the Court of Appeal, in which the Chief Commissioner of State Revenue had indicated that there was no liability under Div 3A in respect of "the Pacinette transaction". That indication cannot bind the Minister in the present litigation which concerns the operation of the Compensation Act. This is so particularly where, as will be made apparent later in these reasons, the evident assumption upon which the Chief Commissioner was encouraged by the appellants to act, namely that all of the steps proposed to be taken in May 1998 had been taken, is shown to be false.
It is yet to be decided whether the amount of compensation will be increased by the segmentation of the land into non‑contiguous lots. This is because both in the interlocutory proceedings in the Land and Environment Court and in the Court of Appeal argument has turned on the resolution of the separated question relating to the efficacy of the steps taken in May 1998 to vest in Pacinette a distinct equitable (and compensable) interest in each of its non‑contiguous parcels of land. Later in these reasons, under the heading "Conclusions", it will be necessary to consider the significance of the outcome of the appeal in this Court for further proceedings in the Land and Environment Court.

[30]

As has been noted, the position of Pacinette has been treated as representative of the entitlement of the class 2 claimants. Something more needs to be said of Pacinette.
There were three lots of land dealt with in the first of the notices of acquisition, that of 19 June 1998, and in the first proceeding before Talbot J. Before 12 December 1997, the registered proprietor in respect of each lot was Port Stephens Development Pty Ltd ("Port Stephens"). By order of the Federal Court of Australia made that day and entered on 19 December 1997, the Court approved a scheme of arrangement and ordered that the whole of the undertaking, property and liabilities of Port Stephens be transferred to Sealark. The Court also ordered that Port Stephens be dissolved without winding up.
These orders were expressed as having been made pursuant to ss 411 and 413 of the "Corporations Law". The reference is to be taken as invoking (a) the application in New South Wales, by force of s 7 of the Corporations (New South Wales) Act 1990 (NSW), of the Corporations Law ("the Law") as set out in s 82 of the Corporations Act 1989 (Cth), and (b) the exercise of the jurisdiction purportedly conferred upon the Federal Court by s 42(3) of the State statute as originally enacted. The making of these Federal Court orders preceded the decisions of this Court in Re Wakim; Ex parte McNally[22] and Re Macks; Ex parte Saint[23]. The upshot of these decisions is that, by the valid operation of s 6 of the Federal Courts (State Jurisdiction) Act 1999 (NSW), the rights and liabilities of all persons are and always have been the same as if the order made by the Federal Court with respect to Port Stephens had been a judgment of the Supreme Court of New South Wales ("the Supreme Court").
Section 86 of the RP Act authorised the Registrar-General to record a court order which had been served upon the Registrar-General and which vested in any person land under the provisions of the RP Act, whereupon that person would become the registered proprietor. Section 46C empowered the Registrar-General on the Registrar-General's own motion, and obliged the Registrar-General when given a written request, to register a person vested by the operation of a statute. At the time of the preparation of an agreed statement of facts for the second hearing by Talbot J in 2003 no entries had been made in respect of the vesting of land in the Minister pursuant to the 1998 acquisition notices.
At the time of the May 1998 transactions and the date of the acquisition notices, the registered proprietor of the lots in question was still shown as Port Stephens. Sealark was not registered as proprietor until 2 October 1998. The transfers by which the registration of Sealark was achieved were expressed as made pursuant to the order of the Federal Court and on their face were executed under the common seal of Port Stephens on 5 March 1998.
Section 413 of the Law, which it must be remembered is to be treated as a law of New South Wales, indicates that, by virtue of what is now the deemed order of the Supreme Court, the property in question was transferred to and vested in Sealark. The order in terms was expressed as effecting a transfer to Sealark pursuant to s 413. However, there was some consideration in argument as to whether the appropriate provision of the Law was not s 413 but s 1336. The latter is a generally expressed provision dealing with the vesting of property pursuant to court orders. Section 1336 makes it clear that, where a transfer or transmission may be registered under a law such as the RP Act, the property does not vest at law until those registration requirements are satisfied although it has earlier vested in equity.
With respect to the land registered under the provisions of the RP Act, references to vesting at law and vesting in equity are apt to mislead. The Torrens system is one of title by registration, not of registered title[24]. The assimilation of the registered title to a legal title may be convenient so long as it is appreciated what is involved. It is likewise with respect to the use of the term "equitable" to describe interests recognised in accordance with the principles of equity but not found on the Register[25].
As has been explained, whether the relevant vesting section with respect to the order was s 413 or s 1336 of the Law, these provisions were made by New South Wales statute law, to be read with the basic provisions of another law of that State, namely the RP Act[26]. The vesting referred to in s 413, unlike that in s 1336, in terms does not refer to unregistered or equitable interests. However, that is how both provisions should be understood when read with the RP Act.
This apparent digression is of importance for the present case. At the time of the May transactions and the date of the first acquisition notice, 19 June 1998, Sealark was not the registered proprietor of the three lots in which Pacinette later claimed to have had an interest. At best, as the appellants conceded in argument, Sealark had an unregistered, and, in that sense, an equitable interest. The compensation claim which Pacinette made thus could only be in respect of an equitable interest acquired or derived from the equitable interest of Sealark. The question then becomes one of the legal efficacy in the compensation proceedings of the steps by which, before the resumption date of 19 June 1998, Sealark dealt with its equitable interest. Did these steps lead to the result that on 19 June 1998 Pacinette had an equitable interest in the lots? To consideration of those steps we now turn.

[44]

Section 23C of the Conveyancing Act requires, among other matters[28], that a disposition inter vivos of an equitable interest subsisting at the time of the disposition "must be in writing" signed by the disponer or the agent of the disponer lawfully authorised in writing (s 23C(1)(c)); but this requirement "does not affect the creation or operation of resulting, implied, or constructive trusts" (s 23C(2)). Nothing in s 23C affects "the operation of the law relating to part performance" (s 23E(d)). Section 54A is a distinct provision[29]. It is concerned not with dispositions but with the bringing of actions upon contracts for the sale or other disposition of land or any interest in land; the requirement in s 54A(1) for a signed memorandum or note does not affect the law relating to part performance (s 54A(2)). The focus of the Minister's submissions was on s 23C rather than s 54A.
The steps described above were designed on the expressed assumption, erroneous for the reasons given, that the subject of the sale to Pacinette as trustee (point (b)) was ownership of the land the subject of the scheme of arrangement, rather than an unregistered or subsisting equitable interest therein within the terms of s 23C(1)(c) of the Conveyancing Act. The desired outcome in point (f), if the trust property be properly identified, was that the whole of the equitable interest in the land was thereby vested in Pacinette, freed from any trust obligation of Pacinette in respect of it and compensable under s 37 of the Compensation Act.
On one view, the scheme represented by these steps failed by reason of misidentification of the subject-matter. But the ultimate issue concerns the existence of a compensable interest in Pacinette at the resumption date. The appeal may be considered on the footing that what was proposed and what was actually done was in respect of properly identified subject-matter.
The Minister emphasises that for Pacinette to have acquired a compensable interest in the resumed land it was necessary to establish the occurrence of two sequential events. The "first event" was that the interest of Sealark had become an asset of The Pacinette Property Trust (point (b)). If that cannot be established by the appellants, then the second event would not be material because of the lack of the necessary subject-matter in that trust. The "second event" is the issue and redemption of units leading to point (f).

[71]

Documents were prepared to record each of these intended steps in respect of each of the 770 transactions. The documents included minutes of meetings (including those of separate meetings for steps (ii), (iv), (vi), (viii), (ix), (xi), (xiv) and (xvi)), offers to sell land, unit certificates and bills of exchange. They did not include any separate registers of unit holders for the various trusts. (It may be assumed that this failure, of itself, would not necessarily deny the entitlement of unit holders[30].) Over all these documents there hovered the sterilising effect of s 29(3) of the Stamp Duties Act if they were "in respect of" a Div 3A transaction.
On 11 May 1998, Mr Halloran, Mr Howell, Ms Earleen Kenny (the secretary of Pacinette) and two solicitors for the Halloran interests (Mr Seller, the partner of the firm having carriage of the matter, and Ms Cleary, then an employee solicitor of the firm) met at the offices of that firm of solicitors. Mr Seller explained to the meeting the intended steps and did so by reference to one particular set of documents that has not since been identified beyond the fact that it was not the Pacinette documents. Mr Seller then asked Mr Halloran, Mr Howell and Ms Kenny to agree that "as regards each other transaction and transfer of land [other, that is, than the one taken as an example] that they occur in the same order and fashion". He said that "[a]ll the transactions are exactly the same and by going through one transaction we are effectively going through all the transactions and then all that remains is the signing of the completed documents". Mr Halloran, Mr Howell and Ms Kenny all said that they understood this.
Subsequently, each of Mr Halloran, Mr Howell and Ms Kenny signed all of the various documents, but each did that separately and the documents were not shown to have been signed in an order that reflected the sequence of steps described above. The Pacinette documents were dated 14 May 1998. It appears that this date was chosen because it was the day on which the last of the necessary signatures was appended to documents relating to the Pacinette transaction.
In addition to the various documents that were said to record or to give effect to the intended steps described above, Ms Kenny subsequently made two statutory declarations in respect of each transaction. In one she declared that she had been present at a meeting on 14 May 1998 of directors of Sealark at which she "heard" Mr Halloran and Mr Howell hold a meeting resolving to accept a written offer by The Pacinette Property Trust to sell the land in consideration of the allotment of 79,000 $1 A Class units in the trust; in the other she declared that she had been present at a meeting of directors of Pacinette as trustee of The Pacinette Property Trust at which she "heard" Mr Halloran and Mr Howell hold a meeting resolving to accept a written offer to sell the land in consideration of the redemption of units in The Pacinette Property Trust by Pacinette. Each statutory declaration was made on 22 May 1998.

[72]

First, the Minister contends, as the Court of Appeal held, that Talbot J erred because the evidence and agreed facts do not establish that the steps said to have taken place in May 1998 actually occurred. The submission was developed by saying that, because the elaborate and sequential steps (particularly respecting the drawing, acceptance and negotiation of a bill of exchange) had not been taken, the scheme had not been implemented in accordance with its design; as a result, Pacinette had held at the resumption date no compensable equitable interest.
Several points should be made immediately concerning the width of the Minister's first contention. One is that it is not said that the transactions were integers in a scheme which was a "sham" in the received sense given in the authorities referred to in Equuscorp Pty Ltd v Glengallan Investments Pty Ltd[31]. Another is that the Minister accepts that contractual assent may be inferred from conduct, and that, any requisite statutory formalities apart, company directors may act informally and may manifest unanimous consent without the passage of formal resolutions. In that regard, the Minister accepts the authorities collected by Powell JA in MYT Engineering Pty Ltd v Mulcon Pty Ltd[32]. Furthermore, the mere fact that a number of meetings are held simultaneously does not deprive the resolutions of efficacy. If, for example, three people are the sole shareholders in each of a number of companies, however large that number may be, they could effectively resolve, on a single occasion, in their capacities as the shareholders of all those companies, in a manner binding all those companies; assuming, of course, that the subject-matter of such resolution was otherwise within the power of a general meeting of the shareholders of each company.
The Minister's second contention is that if, contrary to the first contention, all the steps in the scheme actually occurred, they were ineffective to vest the equitable interests for which Pacinette claims compensation because there was a fatal want of compliance with statutory formalities. The statutory formalities were those made necessary by s 23C of the Conveyancing Act.
Thirdly, if neither of the two above objections succeeds in supporting dismissal of the appeal, the Minister further contended in oral submissions noted above that because stamp duty which was properly exigible was not paid, proof of the transaction relied upon for the first event was denied by s 29(3) of the Stamp Duties Act. For reasons which will be stated after dealing with further matters, it is upon this third ground that the appeal should be dismissed.

[73]

From what happened at the offices of the solicitors, it may be concluded that the parties expressed assent to the taking of the various intended steps. Those who controlled both Sealark and Pacinette (and the other companies involved), both as controllers of the corporators of those companies and as directors, agreed that the steps be taken. Some of those steps required the execution of documents. Not all of those steps were taken. In particular, the steps constituting the "second event", involving the issue and redemption of units, were to be taken in consideration of dealings with the bill of exchange. Something more should be said respecting the bill.
The bill of exchange was drawn by Pacinette and accepted by Sealark as an accommodation party. That is, Sealark signed the bill "without receiving value therefor, and for the purpose of lending his name to some other person" (Bills of Exchange Act 1909 (Cth) ("the Bills of Exchange Act"), s 33(1)). As an accommodation party, Sealark was liable on the bill to a holder for value[33] but had a right of indemnity against Pacinette as drawer[34]. Sealark's acceptance was effective whether or not Sealark accepted the bill before it had been signed by Pacinette as drawer, or while otherwise incomplete[35].
On its face, the bill ultimately executed by Pacinette as drawer and Sealark as acceptor was valid according to its tenor and gave rise to the liability of Sealark as acceptor prescribed by s 59 of the Bills of Exchange Act and the liability of Pacinette as drawer prescribed by s 60 of that Act, as well as Sealark's right against Pacinette to be indemnified against its liability.
The intended dealings with the bill were: first, its use by Pacinette to pay for Ordinary Class units in The Pacinette Property Trust, and then its negotiation by indorsement by Pacinette as trustee to Sealark to satisfy payment to Sealark of the proceeds of redemption of Sealark's A Class units in the trust.
As has already been noted, the evidence led at trial, in this respect, as in others[36], revealed what was intended to be done with the bill rather than what was done. In particular, there was no direct evidence given that the bill was ever tendered in payment for units[37], or that the bill, payable as it was to order, was ever negotiated by indorsement and delivery of the bill[38]. The evidence about the way in which the documents were signed precludes a finding that there was at any particular point in a series of transactions either a delivery of the bill or a negotiation of the bill by indorsement and delivery.
It may fairly be said that this must not be permitted to obscure the facts that:

[77]

Was the design for the first event one for a "transaction" which would cause or result in "a change in the beneficial ownership [by Sealark] of an estate or interest in ... land situated in New South Wales", as stated in s 44(1)(a) of the Stamp Duties Act? The term "beneficial ownership" used in s 44(1) is apt to include as the subject-matter of that "ownership" an equitable estate or interest. The interest of Sealark was of this nature.
Where an interest to be transferred is, as here, a creature of equity, equity requires a clear expression of intention to make an immediate disposition; that, in the absence of an applicable statutory requirement, suffices[40]. If the transaction is a contract rather than a conveyance, then consideration is essential to attract the support of equity[41].
It was essential for the design respecting the first event that there be no written contract for the sale by Sealark to Pacinette as trustee of The Pacinette Property Trust. What might be called stamp duty considerations dictated that absence of a written contract. However, there was to be a written offer, accepted by Sealark and recorded in minutes, and the issue of a certificate for the 79,000 $1 A Class units which was the consideration moving to Sealark.
At the time when that consideration was provided to Sealark, if not earlier upon acceptance by Sealark of the written offer[42], a change in the relationship between Sealark and Pacinette took place. The equitable interest in the land later to be resumed was now vested in Pacinette as a trustee of The Pacinette Property Trust. In the eye of equity, which provided the critical conspectus because the subject-matter was purely equitable, nothing remained to be done in order to define the respective rights of Sealark and Pacinette with respect to that equitable interest; a court of equity might be asked to protect rights completely defined in this way[43]. It may be convenient to describe Sealark in these circumstances as in the position of a trustee for Pacinette under a bare trust involving no duties. But there would be much to be said for the view that the intrusion of the notion of a trust at that stage would be superfluous, were it not for s 23C of the Conveyancing Act.
On one view of the situation of the parties, the absence of a disposition in writing signed by Sealark to comply with par (c) of s 23C(1) would be met by reliance upon s 23C(2) and a constructive trust binding Sealark, in the events that had happened, in favour of Pacinette. On another view of the matter, any assertion of a lack of efficacy for want of compliance with par (c) of s 23C(1) would be to use the statute as an instrument of fraud[44].
Whichever form of reasoning be employed, and it is unnecessary for this appeal to choose between them, the result is that in the circumstances postulated there has been a change in the "beneficial ownership" spoken of in s 44(1) of the Stamp Duties Act.
However, it no doubt is true that Sealark would hold all the issued A Class units in The Pacinette Property Trust. Would the fact that Sealark was sole unit holder of those units have the consequence, as the appellants submitted, that the "beneficial ownership" of the equitable interest in land had not changed because that interest was still to be found, by reason of the issue of the units, in the hands of Sealark? The answer must be that there had been a change. Consistently with the reasoning in CPT Custodian Pty Ltd v Commissioner of State Revenue[45] and with the terms of the Pacinette Trust Deed, to which reference has been made earlier in these reasons, Sealark would not have any interest in any particular part of the Trust Fund or in any investment thereof.
It may then be said, as the appellants appeared to submit, that as a result of the first event there would be a "direct passage" of the beneficial ownership to Pacinette and that, disregarding the second event as superfluous, this sufficed to identify a compensable equitable interest in Pacinette at the time of the resumption of the land.
However, that conclusion would require proof in compensation proceedings that the first event had occurred. The first event critically depended upon proof of written materials, short of a written contract of sale, but still essential to the scheme. The appellants set out to prove these matters, including the written offer and acceptance recorded in the minutes, and the issue of the Unit Certificate (steps (vi), (viii) and (x)). Talbot J held that they had done so. But the sterilising operation of s 29(3) of the Stamp Duties Act denied that proof.
The conclusion that s 29(3) applied is only made good if the materials were proffered in proof of a transaction to which Div 3A applied. What has been said so far is that the terms of s 44(1) were satisfied. However, regard must be had to s 44(2). In its form at the date of the May 1998 events, this stated:

[84]

In written submissions provided after the conclusion of oral argument, the parties developed their conflicting constructions of s 44(2), particularly of par (d), in its application to the circumstances of the litigation and in light of the reasoning in CPT Custodian Pty Ltd[46].
Section 44(2) fixes upon a list of dispositive events in the law which have the consequence that there occurs a change in beneficial ownership. Such steps as the creation of a security, the surrender of a lease and the appointment of a trustee in bankruptcy may readily be seen as having this character. Cases may be envisaged where the critical event for a change in beneficial ownership is the issue or redemption of units in a unit trust scheme. It is unnecessary to determine whether the redemption of units involved in the second event would answer this description.
However, in the present case, the change in the beneficial ownership of the relevant subject-matter, the equitable interest of Sealark, was not brought about as the consequence of the issue of units in a unit trust. The change was brought about, and was the consequence of, the fact that the consideration (no matter what form that consideration took) was provided by Pacinette to Sealark. The change was thus the consequence of the operation of the doctrines of constructive trusts or of the use of statutes as instruments of fraud or both. As with so many questions of causation, it may be possible to say that the result that Pacinette itself held the equitable interest upon the trusts of the Pacinette Trust Deed was the product of many circumstances. And one feature of one of the circumstances, the provision of the consideration by Pacinette to Sealark, was the form of consideration provided: the issue of units in a unit trust scheme. But, within the sense of s 44(2), the result that Pacinette held the equitable interest upon the trusts of the Pacinette Trust Deed was the consequence of the equitable doctrines and principles that have been identified.
The result is that s 44(1) of the Stamp Duties Act applied to the first event and that s 29(3) was engaged in the proceedings before Talbot J. The Minister's submission that the appellants have not established by admissible evidence in the compensation proceedings the occurrence of what has been described as the first event should be accepted. That being so, there was no relevant subject-matter upon which the second event might operate and it need not now be further considered.

[85]

The separate question decided affirmatively by Talbot J was framed in terms asking whether Pacinette had "established on the admissible evidence tendered at the hearing of this question" that it is an owner of an interest in the land in question and is entitled to maintain its claim under s 37 of the Compensation Act. That question should have been answered in the negative.
On the view it took of the facts and of the efficacy of what had been attempted but not achieved, the Court of Appeal went further than returning a negative answer to the separate question. The Court of Appeal ordered that there be a declaration that Pacinette "is not the owner of an interest in the land" and "is not entitled" to maintain its claim under s 37 of the Compensation Act.
Talbot J had dismissed the motion in which the Minister had sought to deal with the other class 2 claimants and made no declaration respecting those claimants. The Court of Appeal set aside Talbot J's order and declared that the relevant class 2 claimants "are not entitled to maintain claims under s 37 of the [Compensation Act]".
Given the basis in the Stamp Duties Act upon which the appeal is decided in this Court, declaratory relief cast in the absolute terms of that given by the Court of Appeal is inappropriate.
The proceedings in the Land and Environment Court are still on foot. Upon resumption of those proceedings, it may be open to the appellants, without foundering upon principles of issue estoppel and related doctrines, to remove the sterilising effect of the revenue legislation by compliance with Div 3A of the Stamp Duties Act and payment of stamp duty and fines to the satisfaction of the Commissioner[47]. We express no view as to whether that course would be open to the appellants, a matter upon which submissions were not made, but the possibility re‑emphasises the need for attention to the precise issue set aside for separate determination by Talbot J[48]. This in terms fixed upon what was established by the admissible evidence.
The order of the Court of Appeal should be varied to reflect that state of affairs.

[96]

I agree with this reasoning, except in one respect.
Step (viii) created a contract to transfer Sealark's equitable interest in the land to Pacinette in return for the issue by Pacinette in favour of Sealark of 79,000 $1 A Class units. At that moment a constructive trust arose and the beneficial ownership of Sealark's equitable interest changed, at least to some extent[51]. The interest of Pacinette as purchaser was commensurate with its ability to protect that interest by obtaining specific performance[52]. In the present circumstances there was no impairment of that ability by reason of any termination of the contract by Sealark as vendor. Hence there is no circularity, and no other difficulty[53], in viewing Pacinette as having obtained an interest under a constructive trust in such a way as to change the beneficial ownership of Sealark's equitable interest to some extent. It is unnecessary to consider whether the creation of a beneficial interest in Pacinette by way of constructive trust in consequence of step (viii) meant that there was nothing more of Sealark's equitable interest in the land to pass in consequence of steps (ix) and (x), or whether after step (viii) but before steps (ix) and (x) Sealark retained some equitable title which only passed when steps (ix) and (x) took place.
To the extent that any change in beneficial ownership took place when steps (ix) and (x) were carried out - the allotment of the 79,000 $1 A Class units and the issue of the certificate relating to them - that was a change that occurred as the consequence of the issue of units in a unit trust scheme within the meaning of s 44(2)(d). However, this does not assist the appellants. A different change in beneficial ownership occurred earlier, at step (viii). That change in beneficial ownership, occurring when the constructive trust arose as the consequence of the promise to issue units in the unit trust scheme, was not a change in beneficial ownership occurring as the consequence of the issue of those units. It was only a change occurring as the consequence of the promise to issue them. Hence, s 44(2)(d) does not apply. Therefore, s 29(3) prevents proof of step (viii). That in turn prevents establishment of Sealark's acceptance of Pacinette's offer to buy Sealark's equitable interest in the land. In consequence it is impossible to prove the passing of that equitable interest, and the scheme thus fails at that point.
In written submissions filed after the conclusion of oral argument, the appellants advanced the contention that these conclusions do not follow. That contention was not based on any view that step (viii) did not change the beneficial ownership of Sealark's equitable interest; indeed the appellants accepted that a "change in beneficial interests in, as opposed to an absolute change of beneficial ownership of, Sealark's land could have occurred when Sealark accepted Pacinette's written offer". In a similar vein, the appellants conceded that by reason of step (viii) equity would impose a constructive trust over Sealark's proprietary interest in favour of Pacinette, and this gave Pacinette a proprietary interest in the land. Rather, the appellants' contention that s 29(3) did not prevent proof of step (viii) was based on giving the word "transaction" in s 44(2)(d) a broad meaning. In the present context, on that meaning, the word "transaction" referred to "the whole of the dealings pursuant to the contract formed by Sealark's acceptance of Pacinette's written offer". The "transaction", it was said, comprised not only the contract itself (step (viii)) but the steps taken to carry it into execution (including steps (ix) and (x)).
That broad construction of the word "transaction" is unsound. Section 44(2) sets out seven precisely defined events. The respondent submitted that the legislature, in speaking of "a change in beneficial ownership occurring as the consequence of" one of those events, required the event to be an operative cause of the change. The construction underpinning that submission is sound. It requires, in contexts like the present, identification of an event which both falls within the expression "the issue or redemption of units in a unit trust scheme" and is the operative cause of a change in beneficial ownership. On that construction, s 44(2)(d) does not extend to events other than the issue or redemption of units, even if they are part of the dealings pursuant to a contract relating to the change in beneficial ownership.

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