Perpetual Trustee Company Limited v Federal Commissioner of Taxation [1931] HCA 20

Held, by Starke, Dizon and, semble, Evatt JJ. (McTiernan J. that the expression "public benevolent institution" in sec. 8 (5) me institution organized for the relief of poverty, sickness, destitution or he ness.

The Royal Naval House, Sydney, is built on land made available Government and is used for the benefit of the petty officers and lower of the navy by providing accommodation and recreation for them when and its benefits were extended to the lower ratings of visiting foreign vessels, Relatively small charges were made for sleeping meals, baths, billiards and lockers, money and other valuables being taken ea of without charge. Deficiencies on the year's working were met out 0 annual grant by the Federal Government and by subscriptions and donat

Held, by Starke, Dizon and Evatt JJ. (McTiernan J. dissenting),

Royal Naval House is not a "public benevolent institution " within meaning of sec, 8 (5) of the Estate Duty Assessment Act 1914-1928,

On the hearing of an appeal to the High Court by the Perpetual Trustee Co. Ltd., executor and trustee of the will of Arthur Ernest Hezlet deceased, from an assessment made by the Federal Commis- sioner of Taxation under the Estate Duty Assessment Act 1914-1928 in respect of a residuary bequest made by the deceased to the Royal Naval House, Sydney, the parties admitted, for the information of the Full Court, facts which were stated substantially as follows : -

Arthur Ernest Hezlet of " Lynton," Clarence Street, Burwood, near Sydney was at the respective dates of his will and death hereinafter mentioned seised, possessed or otherwise well entitled to considerable real and personal estate in New South Wales in the Commonwealth of Australia.

The said Arthur Ernest Hezlet died on 17th October 1929 and probate of his said will was on 20th December 1929 granted to the Perpetual Trustee Co. Ltd., the executor and trustee therein named.

By his said will the testator, after bequeathing a number of legacies not material to be herein set forth, devised and bequeathed his residuary real and personal estate to his said trustee in trust after sale and conversion of such parts of the same as did not consist of money to pay thereout certain pecuniary legacies, and subject thereto and after payment of the said legacies to pay, transfer and make over one-half of the residuary trust funds in his said estate equally between the Royal Naval House, Grosvenor Street, Sydney, and The Rawson Institute for Seamen, Sydney, and the testator directed that the whole of the probate, estate, legacy or other duty payable upon his death in respect of his real or personal estate should be paid out of his residuary estate.

The estate of the said testator has been assessed for Federal estate duty by the Deputy Commissioner of Taxation at a net assessable value of £45,270, on which duty has been assessed at the tate of 95 per cent.

The amount claimed for duty by the said Deputy Commissioner is £3,286 - or £4,436 less an amount of £1,150, being a rebate allowed on the shares in the said estate bequeathed to the widow of the testator.

. bequeathed by the said will to the Royal Naval House, Sydney,

Included 'in the said assessable value is the sum of £5, being the value of the share in the residue of the said esta

The Perpetual Trustee Co. Ltd. as administrator of the estate, being dissatisfied with the said assessment, has duly lodg with the Commissioner for Taxation an objection against the said assessment and has claimed that the said amount of £5,398 0 not be included therein and that the said assessment should reduced by the amount of duty attributable to the said sum. -

The Commissioner for Taxation has considered the said object and has disallowed the same. '

The Royal Naval House is erected on two parcels of situated in the City of Sydney. one of which was made availa by the Government of the Colony of New South Wales in or ab 1888 and the other in or about 1905 for the purpose of a1 the said Royal Naval House, and the cost of erecting the said Naval House was defrayed partly by subscriptions obtained f officers and men of the Royal Navy and from the public and p by a grant of £7,000 from the Government of the said Colony.

The said land was made available and the said building wa erected for the benefit of the petty officers and lower ratings of th Royal Navy and for the purpose of providing accommodation recreation for the petty officers and lower ratings of the Royal Na when ashore.

Additions to the said building were made in 1907 at a co of £9,000. The cost of the said building was defrayed partly grant of £1,000 by the Lords Commissioners of the Admiralt partly by a grant of £3,000 from the State of New South W and partly from public subscriptions.

The affairs of the said Royal Naval House are governed b trustees and by a House Committee. The trustees are tv number, and consist of the Rear-Admiral Commanding His Maj Australian Squadron, the Flag Captain, the Chief Secretary of # State of New South Wales for the time being, and nine others. original trustees were appointed by the Governor of the Col New South Wales. When vacancies occur among the trustees trustees are appointed by the remaining trustees with the app 01

of the Governor of the State; which approval is notified in the Government Gazette. The trustees are appointed for life or until resignation. The trustees receive no remuneration for their services. The House Committee consists of the trustees and of the Captain Superintendent, His Majesty's Australian Naval Establishment, Sydney, the Captains of His Majesty's Ships, the Senior Executive Officer in the Port of Sydney and the Engineer Captain, Garden Island. There is also an Honorary Secretary and Treasurer and a Superintendent. The said Royal Naval House is inspected at intervals by members of the Naval Board and other Naval Officers, and during the year 1929-1930 was inspected by Rear-Admiral W. M. Kerr, C.B., C.B.E. (1st Naval Member of the Naval Board), Captain H. J. Feakes, R.A.N. (2nd Naval Member of the Naval Board), Captain J. B. Stevenson, O.M.G., R.A.N. (Captain Superin- tendent Sydney), Captain W. S. Chalmers, D.S.C., R.N. (Flag Captain and Chief Staff Officer, H.M.A.S. Australia).

The Royal Naval House has no written constitution or trust deed.

The accommodation provided at the Royal Naval House includes a number of dormitories, a dining-room, lounge and reading-room, a gymnasium, cloak-room, locker-room, billiard-room and a social hall, which is used for amusements, lectures, concerts and other entertainments. A small charge is made for sleeping accommodation, for meals, for baths, for billiards and for the use of lockers, but no other charge is made for the use of the Royal Naval House, and the money and valuables of petty officers and men using the said Royal Naval House are taken care of without charge.

All petty officers and men of the Royal Australian Navy and the Royal Navy are eligible to use the said Royal Naval House, and the same accommodation is open to the petty officers and men

of the warships of other countries when visiting Sydney.

The Royal Naval House receives an annual subsidy of £250 from the Commonwealth Government through the Naval Board. Its revenue also includes public subscriptions and charges made for beds, for meals and baths and the use of a cloak-room. The charge for beds is 1s., for shakedowns 6d. and for baths 6d. The said

PERPETUAL TRUSTER Co. Lrp. v Frperau Commis- SIONER OF TAXATION.

subsidy of £250 per annum was increased to £500 during the yes 1928-1929 when certain warships were absent from Sydney,

The land occupied by the Royal Naval House is veste the Minister for Public Works as constructing authority for purposes of the Public Works Act 1912, and the rates on the ls are paid by the State Government.

From Ist October 1890 to 30th June 1930, 1,735,296 have slept in the Royal Naval House, and, during 1929-1930, men slept in the Royal Naval House.

Annexed hereto is the statement of receipts and exp and annual report of the said Royal Naval House for the ye 1929-1930. The statements contained in the said documents a correct. b

The question stated for the opinion of the Full Court of the Hi Court was whether the bequest of one-fourth of the residuary funds in the estate to the Royal Naval House, Grosvenor St Sydney, is a bequest to a public benevolent institution in Aus or toa fund established and maintained for the purpose of pro money for use for such an institution or for the relief of per necessitous circumstances in Australia.

The statement referred to in par. 18 of the case stated sh that the receipts during the year ending 30th June 1930 con of takings £3,202 Os. 6d. ; subscriptions, donations, &c., £365 12s. Il and navy grant £250 - which, together with a balance of £702 6s. ; brought forward from the previous year, totalled £4,519 19s. whilst the expenditure for the same period consisted of repairs improvements £146 3s., house-keeping account £3,443 6s. 9 credit balance of £930 9s. 9d. being carried forward. The report for the year in question showed that the principal items 1 the takings were for 50,231 beds at Is. £2,511 Ls., cloakroo charges at 3d. per package per week £210 Lls., and use of loc! at 2s. each per month £394 9s. ; whilst as regards the expenditure t principal items in the housekeeping account were salary and ¥ e £2,251, laundry £294, washing and renovation of mattresses £111 The report stated that there had been a growing tendency durin the year for men, that is, naval ratings, when applying for beds state that they had no money to pay for same, and to promise

do so on the pay-day next following. No rating was ever refused H- ©. or A.

such a request, no matter at what hour of the night it might be made ; and of the 1,243 applications of this nature made during the year under review the promises so made had been honoured in 1,035

Maughan K.C. (with him Nicholas), for the appellant. The Royal Naval House is a public benevolent institution within the meaning of sec. 8 (5) of the Estate Duty Assessment Act, and therefore the bequest made in its favour is exempt from estate duty. The general tenor of decisions is that an institution is a public institution if it benefits the whole of the public or a considerable section of it. Here the persons entitled to its benefits are a sufficiently wide section of the public to make the House a public institution. As to what is meant by " public," see In re Income Tax Acts [No. 1] (1).

(McTrernan J. referred to Royal Masonic Institution for Boys (Trustees of ) v. Parkes (2).]

Where patients from a particular area were treated free and other patients paid, the hospital where they were treated was held to be a "public " hospital (Horner v. Lewis (3) ). An institution for the relief of ladies in reduced circumstances was held to be charitable (Shaw v. Halifax Corporation (4) ). " Benevolent" is wider in its purport than " charitable." " Charitable " means having goodwill or wellwishing to the poor; "benevolent"? means having goodwill or wellwishing to anybody (Morice v. Bishop of Durham (5) ). The law established by the decision in Swinburne v. Federal Commissioner of Taxation (6) was swept away by the decisionin Adamson v. Melbourne and Metropolitan Board of Works (7). As shown by the section the intention of the Legislature was a far-reaching one, and it is not limited to poor and needy persons. " Benevolent " connotes giving something for nothing and not necessarily all things for nothing. It means desirous of the good of others (The Oxford English Dictionary). Assistance to the poor is not a necessary ingredient of " benevolence." The term "benevolent institution " is not limited to an institution rendering

(1) (1930) V.L.R. 211, at pp. 215, (4) (1915) 2 K.B, 170.

(2) (1912) 3 K.B. 212. (6) (1920) 27 C.L-R. 397, (3) (1898) 78 L.T, 792. (7) (1929) A.C. 142,

TRUSTEE Co. Lrp. v Feperat Commais- SIONER OF Taxarion.

assistance to poor persons (Attorney-General for New South Wal v. Adams (1)). Mere benevolence is not charity (In re Wall; Po v. Willway (2) ). If such benevolence is for a section of the publ it is public benevolence.

ministers to the needs of the poor and does so in the main, if n entirely, gratuitously. Men in the Navy who are paid, lodged fed are not needy poor. Although the word " benevolent" have a wide meaning it has not the same signification when include in the phrase " benevolent institution " (Attorney-General for Ne Zealand v. Brown (3)). Benevolent institutions are institutio for the relief of the needy poor (Kelly v. Municipal Counci Sydney (4)). As to what is meant by "benevolent asylu see Christ College Trust v. Hobart Corporation (5). The cla provided for at the Royal Naval House are not the poor am needy and are not provided for gratuitously. The sources the fund subscribed for the purpose of acquiring the land ap erecting the building thereon are immaterial. The Royal Navi House is an institution which provides an inexpensive club-h for the persons in question. It is no more a public benevol institution than are the various universities. Most of the se1 rendered by the House are obtained by the recipients only | payment therefor; the balance-sheet shows that the House practically self-supporting. In Attorney-General for New Wales v. Adams (6) the Court, when construing the will there question, thought that there was some antithesis to be drat between benevolent institutions, charitable institutions and phila thropic institutions.

Maughan K.C., in reply. Public benevolence is not limite persons in necessitous circumstances (Moule v. Altorney-Gent (7) ). The Royal Naval House cannot be regarded as practic

(1) (1908) 7 C.L.R, 100. (4) (1920) 28 C.L.R. 203, at p. 20

(2) (1889) 42 Ch. D, 510, at p. 511. (5) (1928) 40 C.L.R. 308.

(3) (1917) A.C, 393, at p. 397, (6) (1908) 7 CLLR. 100. (7) (1894) 20 V.LR. 314, per aBeckett J., at p. 319,

self-supporting as no cognizance is taken in the balance-sheet of H.C. or A. the cost of the land and charges in connection therewith. The Ras

cases of Attorney-General for New Zealand v. Brown (1) and Kelly VPexrercan

y. Municipal Council of Sydney (2), referred to on behalf of the Co. Lr. respondent, are distinguishable because they do not deal with public

Srarxe J. The question stated for the opinion of the Court arises upon sec. 8 (5) of the Estate Duty Assessment Act 1914-1928. Tt is as follows: "Estate duty shall not be assessed or payable upon so much of the estate as is devised or bequeathed or passes by gift inter vivos or settlement for religious, scientific, or public educational purposes in Australia or to a public hospital or public benevolent institution in Australia or to a fund established and maintained for the purpose of providing money for use for such institutions or for the relief of persons in necessitous circumstances in Australia." This provision replaced a sub-section in the Act of 1914-1922 which read: "Estate duty shall not be assessed or payable upon so much of the estate as is devised or bequeathed or passes by gift inter vivos or settlement for religious. scientific, charitable or public educational purposes."

The amendment seems to have been made in consequence of the decision in Chesterman v. Federal Commissioner of Taxation (3)--where the Judicial Committee held that the word "charitable" in the earlier Act was used in its technical legal sense, as in the Statute of Elizabeth, and not in the narrower sense of the relief of poverty or destitution - and of the remarks of Isaacs J.in Young Men's Christian Association of Melbourne v. Federal Commissioner of Taxation (4). In Adamson's Case (5) the Judicial Committee also held that the expression "charitable institution " must be taken in its technical legal sense unless a contrary intention appear. Now we have to consider the expression " public benevolent institution." It cannot be said that

(1) (1917) A.C. 393. (3) (1926) A.C. 128; 37 C.L.R. 317.

(2) (1920) 28 C.L.R. 203. (4) (1926) 37 C.L.R, 351, at p. 359. (5) (1929) A.C. 142,

H.C. or A. this expression has any technical legal sense, and therefore it j

'Trust! Co. Lrp. v. Feprrat Commas- SIONER OF TAXATION.

be understood in the sense in which it is commonly used in

expression, nor is it to be found in any dictionary. It is, howe found in the Act under consideration in association with sue institutions as public hospitals and with funds established ; maintained for the relief of persons in necessitous ci) in Australia. In the context in which the expression is found, in ordinary English usage, a " public benevolent institution " in my opinion, an institution organized for the relief of sickness, destitution, or helplessness. The Royal Naval H has none of these characteristics : it is organized for the a tion and recreation of the naval forces of His Majesty a hospitality is also-extended to the naval forces of other It would surprise English-speaking people, I think, to learn th the Royal Naval House naval forces are accommodated and ent tained at a public benevolent institution.

The question stated should be answered in the negative.

Dixon J. Sec. 8 (5) of the Estate Duty Assessment Act 1914-192 provides that estate duty shall not be assessed or payable upon s much of the estate as is devised or bequeathed or passes by g inter vivos or settlement for religious, scientific or public educationa purposes in Australia, or to a public hospital or public institution in Australia, or to a fund established and mai

for the relief of persons in necessitous circumstances in A

The question upon this appeal is whether an institution cal Royal Naval House is a public benevolent institution within meaning of the exemption. The nature and the purposes of fl institution are fully described in the case stated, and it ca i denied that it is organized and conducted out of feelings of goo in order to promote the comfort and happiness of the lower the Royal Navy. Because of its association with the v Governments, and because it is concerned with the naval fo the country, it would be difficult, if it be a benevolent institut to deny it the description " public." But, in my opinion, i

neither promoted nor conducted for the relief of poverty, distress, suffering or misfortune, and the question is whether for this reason it lacks the qualities necessary to bring it within the meaning of the compound description "public benevolent institution." The words " benevolent institution " are commonly used in combination to denote bodies organized for the relief of poverty or of distress. Familiarity with the application of the expression to bodies of this kind inevitably tends to make the use of the phrase appear misplaced in relation to bodies which do not relieve poverty or misfortune and merit the description " benevolent " only because their objects are benignant. It is said, however, that after all "' benevolent " is an ordinary English adjective, and that frequent application of a compound expression of which it forms a part to one or some of many classes of things possessing the attributes it connotes affords no sufficient reason for restricting the meaning of the expression. In such matters one must often be guided to a great degree by one's own experience in the use of terms. In the present case little help is provided by dictionaries, statutory usage, or judicial decision. For my part the application of the expression " benevolent institution" to such organizations as Royal Naval House seems odd and inappropriate. Moreover, I agree with the suggestion of my brother Starke that the history of the provision in sec. 8 (5) of the Estate Duty Assessment Act 1914-1928 is enough to show the word "benevolent " does not there possess its general descriptive meaning ; because if it were given such an interpretation its applica- tion would extend in some ways far beyond the legal meaning of the word " charitable." After the expression " charitable purposes " in sec. 8 (5) of the Estate Duty Assessment Act 1914 received in the Privy Council in Chesterman's Case (1) its wide legal meaning, and after the observations of Isaacs J. in the Young Men's Christian Association Case (2), the present provision was substituted by sec. 5 of Act No. 47 of 1928. Having regard to this history of the legislation and to the considerations I have mentioned, I am unable to place upon the expression "public benevolent institution " in the exemption a meaning wide enough to include organizations

(1) (1926) A.C. 128; 37C.L.R. 317. (2) (1926) 37 C.L.R., at p. 359. VOL, XLV, 16

which do not promote the relief of poverty, suffering, dist misfortune.

In my opinion the question in the case stated should be ans No.

Evarr J. The Royal Naval House stands on land situate in City of Sydney. The Lords Commissioners of the Admiralty, Government of the State of New South Wales, the officers and men of the Royal Navy and the general public of the State assisted in providing the funds necessary for the erection of the building and certain later alterations to it. The land was made available by Government of New South Wales and the title is vested in a pub authority representing that Government. The building onitisu for the benefit of the petty officers and lower ratings of His Maj Navy by providing accommodation and recreation for them wi ashore. No written constitution or trust deed is in existence the House is controlled by honorary trustees and committees, representatives of His Majesty's Australian Navy assist in its contr

The services of the House are largely availed of by the petty offic and men of His Majesty's and His Majesty's Australian Navy, when warships from foreign countries visit Sydney Harbour, th lower ratings are also allowed to use the House.

Charges are made by the governing authority of the House fo sleeping accommodation, for meals, for baths, for billiards and fo lockers but money and valuables of the sailors are taken care 0 free. The charges are described as small (everything is relati

• a bath costs sixpence) but it is noteworthy that in the 1929-1930 the amount received in respect of such charges £3,202, while the total expenditure for that year was only £3,589 including a salary and wages bill of £2,251. No rent is paid to the Government of New South Wales and the loss on each year apparently made up by a small grant of £250 from the wealth Government and by subscriptions and donations. One spet concession has been stressed in argument: when men ask for bed for the night, they may obtain it on a promise to pay on th next pay day. These promises are usually honoured.

Is the Royal Naval House a "public benevolent institution " within the meaning of sec. 8 (5) of the Hstate Duty Assessment Act 1914-1928 ? No doubt, the body both in origin and function has had a sufficiently " public" character impressed upon it. But is it a " benevolent institution " 4

The House of course serves very useful purposes. It is convenient that the lower ratings in actual naval service should have an inexpensive hostel available to them when on leave from their ships in Sydney. If they take leave overnight they might otherwise have to seek for places of accommodation at hotels or other places in city or suburbs. The Naval House, no doubt, has become to a large extent the club of those who are accorded its privileges. It probably enables the officers in control of His Majesty's ships of war to get quickly in touch with men required to return at short notice from leave.

There is no element of profit-making in the concern, but the receipts from service charges make the House nearly self-supporting. It resembles in this respect, bodies founded at Aust#alian Universities by State or governing authorities in order to benefit the under- graduates. They are sometimes self-supporting; often they are not, because charges made for services are as small as possible. Halls and rooms are there used for lectures and debates but no one (except perhaps a student in sarcastic vein at a debate) would describe them as " benevolent institutions." Yet students are asa class notoriously impecunious, much more so than the naval ratings in regular employment at a pay fixed by Government.

There are, however, very many bodies which readily answer the description of " benevolent institutions." The Benevolent Society of New South Wales provides food and clothing for those in poverty and distress, the Scarba Home takes care of deserted babies, many organizations of Church and State provide for the maintenance, housing and relief of the aged poor, orphans and those suffering from bodily or mental disease. A characteristic of most of these organizations is the absence of any charge for services or the fixing of a purely nominal charge.

Such bodies vary greatly in scope and character. But they have one thing in common: they give relief freely to those who are in need of it and who are unable to care for themselves,

TRUSTER Co. Lrp, v FEDERAL Commis- SIONER OF TAXATION.

Those who receive aid or comfort in this way are the poor, sick, the aged, and the young. Their disability or distress ar pity, and the institutions are designed to give them prote They are very numerous - ' the nobler a soul is the more objects of compassion it hath" - and they have come to be known as " benevolent institutions."

Such a phrase seems to me to be impossible to apply to the Ro Naval House at Sydney. It is in truth a cheap and conver club-house for those in regular naval services and pay and for. one else. The public encouragement evidenced in its form and running is in part a gesture of hospitality, in part a recogni of the debt owed by the community to those who are serving The rating, paying for his bed and board, using the services provic at the rates fixed, would, I think, greet the statement that he h been staying at a "benevolent institution" with amazem perhaps with indignation. For he is not a person in distress, Or the contrary he is a chosen and active protector of the nation, object not of compassion but of admiration. Neither the put spirit of those who started and those who control the instit nor the convenience or benefit it is to the ratings, is sufficient t make it a " benevolent institution." It is probably because of the fact that it is a social institution rather than a benevolent institution that it is so attractive to naval men and so useful to the Navy itse

McTiernan J. The appellant, which is the executor of the wi of the late Arthur Ernest Hezlet, claims that a bequest of one qua te of the residuary trust funds in the testator's estate, which bequeathed by him to the Royal Naval House, Grosvenor Str Sydney, is exempt from the assessment or payment of estate d under the Estate Duty Assessment Act 1914-1928, on the ground the Royal Naval House is a " public benevolent institution i Australia " within the meaning of sec. 8 (5) of the above-mentio Act. It was contended on behalf of the respondent that a pub benevolent institution is an institution which ministers to the po and needy, and that therefore on the facts and circums

disclosed by the special case the appeal must fail. The ph

"public benevolent institution" is not defined in the Act, nor is it a term of art. There does not appear to be any definite under- standing as to what is the precise meaning of the'expression. Thus the soundness of the method of approaching the solution of the question for decision in the present appeal, by propounding one test to which the Royal Naval House should answer, may be estimated by a consideration of the following passage from the judgment of Lord Warrington of Clyffe in the case of the Girls' Public Day School Trust v. Ereaut (1). His Lordship said : - " The Act " (Income Tax Act 1918, 8 & 9 Geo. V. ¢. 40) " contains no definition of ' public school,' and it is therefore the function of the tribunal in each case to say whether the school in question is properly so described. In arriving at a conclusion there are obviously many elements to be taken into consideration, and to say that, whatever the other circumstances may be, the existence or non-existence of one element affords an irrefutable test is open to the objection that by doing so the tribunal pro tanto binds itself by a definition which the statute does not contain." The Royal Naval House has, in my opinion, characteristics which entitle it to be described as " public" (Shaw v. Halifax Corporation (2); Grirls' Public Day School Trust y. Ereaut). Judicial authority however affords no such clear guidance as to what the expression " public benevolent institution " signifies.

Some instances may be given of the use of the word " benevolent "" in the statutes of this and other States of the Commonwealth as an adjective qualifying the words "institution," " socicty " and "asylum." In McLaughlin v. Council of the Municipality of Randwick (3) Campbell J. decided that an institution known as "Our Lady's Home" was a " public benevolent institution " within the meaning of sec. 132 (1) (d) of the Local Government Act of New South Wales, No. 41 of 1919. The special case upon which his Honor gave his decision stated : - ' The institution known as 'Our Lady's Home' is an establishment for nurses" who "'went out and nursed the sick poor in their own homes. It is a home for nurses to live in and is supported by voluntary

(1) (1931) A.C. 12, at p. 27. (2) (1915) 2 K.B. 170. (3) (1926) 43 N.S. W.W.N. 165,

-Society of New South Wales," has the following recital, inter

contributions from the general public. The nurses live permanent and free on the premises, and get board and lodging and : clothed by the institution but receive no remuneration.

institution does not receive money from patients and does minister to those who can pay. The nurses are obliged to be Catholics but do not take any religious vows. Members of religions are treated." His Honor said (1): - '"I think association, voluntary as it is, with its declared objects and its a operations, is a public benevolent institution, and the only q seriously argued before me was whether the purposes of the i tion could be said to extend to and include the occupation of tl subject property by the members, primarily as a headquarters residence. I think they can." His Honor held that the housing of the establishment was a vital part of the purpose of the institution, and for that reason decided in its favour. The preamble of Benevolent Society of New South Wales Act 1902, which is "an 4 to incorporate and otherwise promote the objects of the Benevolent

namely, " Whereas a society was in the year one thousand hundred and nineteen established, known as the Benevolent Soci of New South Wales, having for its object the relieving of poor, ag and distressed persons and others requiring such aid:" See. 5 0 the Child Welfare Act 1923 of New South Wales contains the follow definition: '' Asylum' includes the Benevolent Asylum, eve! asylum for destitute children, or industrial asylum, and eve charitable institution supported wholly or in part by grants f the Consolidated Revenue." The Adoption of Children Act 1 of South Australia (sec. 15 (1) ) is in these terms: "Upon #l application in writing of the manager for the time being of am benevolent or other institution, established in connection with any religious denomination, who is desirous of adopting any di child in connection with such institution, any Court on being sati

• (a) that such child is deserted ; (6) that such child is of the religious denomination as that of the institution whose ma makes the application, and (c) that such institution is propel conducted, and is capable of properly bringing up such child, (1) (1926) 43.N.S.W. W.N., at p. 166,

make an order authorizing the manager for the time being of such institution to adopt such child in connection with such institution, such child retaining his or her own name, and in no manner inheriting or succeeding to any property, real or personal, or otherwise how- soever, of such manager or institution." Another instance is sec. 3 of the Hospitals and Charities Act 1928 of Victoria: "* Benevolent Society' means any society or association of persons the funds of which are obtained in whole or in part by voluntary contributions and which has as its object or among its objects the affording of

charitable relief to diseased infirm incurable poor or destitute persons (including children) and is not exempted from the operation of this Act; but does not include - (a) any 'institution' within the meaning of this Act; (b) any such society or association whose funds are wholly obtained from collections made at religious services ; or (¢) any association of two or more persons acting together temporarily for any specific charitable object."" The Hospitals and Charities Act 1928 of Victoria, sec. 67 (1), provides under the heading "Philanthropic Societies or Associations"? that "any society or association of persons formed or to be formed having for its object the saving of human life, the promotion of health temperance or morality, the prevention of cruelty or vice, or other cognate objects of a philanthropic or humane nature, shall subject to the require- ments as to voluntary contributors contained in Division one of this Part as to institutions capable of incorporation thereunder be and be deemed to be an institution capable of incorporation under this Part and may be incorporated accordingly." Sec. 8 (4) of the Friendly Societies Act of Queensland, 58 Vict. No. 17, provides that societies for any " benevolent or charitable purposes," therein

called " benevolent societies," may be registered under that Act. The word " benevolent " or " benevolence " appears in the follow- ing statements, which have been culled from the decisions. In the Commissioners for Special Purposes of Income Tax v. Pemsel (1) Lord Watson said: - 'I have been unable to find that the word 'charitable, taken by itself, has any well-defined popular meaning in Scotland or elsewhere. It is a relative term, and takes its colour from the specific objects to which it is applied. Whilst it

is applicable to acts and objects of a purely eleemosynary charg ct it may with equal propriety be used to designate acts and purpos

spirit of charity or benevolence." In Attorney-General for N South Wales v. Adams (1) Higgins J. said: " But gifts to ass people who are not poor are not charitable, though they may be benevolent or philanthropic." His Honor was explaining th technical meaning of the word "charitable." At p. 131 his Hono said: "Again, a club for ex-militia officers, merely because tl have been militia officers, and irrespective of their wealth a1 poverty, could hardly be called a charitable institution, though i may be benevolent."

Mr. Jordan has submitted that the meaning of the exp " public benevolent institution " should not be construed by together the respective meanings of the three words of which it composed. That submission is, I think, a sound one. It should be noted, however, that the dictionaries do not strictly confine the meaning of " benevolent" or " benevolence" within the area of pure eleemosynary acts. In the Ozford Dictionary, "benevolent" is to mean: "desirous of the good of others, of a kindly dispositi charitable, generous." In the same dictionary " benevolence " is to mean : - " 1. Disposition to do good, desire to promote the happit of others, kindness, generosity, charitable feeling (as a general state or disposition towards mankind at large). 2. Favourable feeling or position, as an emotion manifested towards another ; affection: g will (towards a particular purpose or on a particular occasion). 3. 4 expression of goodwill, an act of kindness ; a gift or grant of money a contribution for the support of the poor." Indeed, the significat of the word "benevolent" has been said to be influenced by th substantive to which it is attached. " But, even upon this a tion, the appellant's difficulties are not removed, for this reasonit would not endow the word ' benevolent * with the same significa when it is - as it must be in the present will - attached to the

' objects,' and their Lordships cannot accept the appellant's argu that if benevolent institutions and benevolent associations in New Zealand are properly regarded as charitable this involves t

conclusion that benevolent objects, where the adjective has no such local limitation of meaning, are necessarily charitable also" (Attorney-General for New Zealand v. Brown (1) ).

Tt does not appear to me that there is any "' common understand- ing" (Girls' Public Day School Trust v. Ereaut (2) ) of which the Legislature must be taken to have had cognizance that an institution would not be properly described as a " public benevolent institution " unless its object was to minister to the poor and needy members of society. There appears to me to be much force in the submission of Mr. Maughan that if the expression " public benevolent institu- tion " bears the meaning for which respondent's counsel contends, the concluding words of the sub-section, namely, " or for the relief of persons in necessitous circumstances in Australia " are unnecessary. However, it cannot be predicated that the Legislature always intends to use mutually exclusive words in a context such as that contained in the sub-section. (See Chesterman v. Federal Commis- sioner of Taxation (3).)

"Public benevolent institution" is, in my opinion, a wider term than "benevolent asylum." I do not imagine that it is possible to enumerate all the services which may be rendered by human benevolence operating through the agency of a public benevolent institution. While I do not think that the Legislature intended strictly to confine the exemption to gifts to an institution of a strictly eleemosynary character, yet it may be difficult to bring within the scope of the exemption which has been granted in aid of a public benevolent institution, a gift to an institution which is of a public character, but does not exist for the relief of distress or misfortune occasioned by poverty. But, I am of opinion, that the present case is one in which such a difficulty is disposed of by the facts and circumstances stated in the special case.

It was decided in Ohesterman v. Federal Commissioner of Taxation (4) that the word "charitable " which was in sec. 8 (5) of the Estate Duty Assessment Act 1914 must be construed in its technical sense. The last-mentioned sub-section was in these terms: " Estate duty

(1) (1917) A.C, at pp. 397-398. (3) (1926) A.C,, at p. 132; 37 C.L.R., (2) (1931) A.C., at p. 28. at p. 320. (4) (1926) A.C. 128; 37 C.L.R. 317.

i) PERPETUAL 'TRUSTER Co. Lap.FEDERAL Commts- SIONER OF TAXATION.

'TRusTER Co. Lap. ». FEDERAL Commns- STONER OF Taxation.

shall not be assessed or payable upon so much of the estate devised or bequeathed or passes by gift inter vivos or se for religious, scientific, charitable or public educational purpo Subsequently the Parliament repealed that sub-section and enac sec. 8 (5) of the Estate Duty Assessment Act 1914-1928. A com of the two sub-sections appears to show that the Legislature to exclude from the benefit of the exemptions granted by the Ac a number of gifts which, though good charitable gifts in the technic sense, were not for religious or scientific or for public educati purposes or were not made upon the principle of giving direct re or assistance to mankind in sickness or in need.

avert the consequences of those disabilities, the Royal Naval Hou in my opinion, exercising a function which distinguishes it " public benevolent institution." In view of the identity of the el to whose needs it ministers, this institution is perhaps sui generis. It has been established to provide for the petty officers and lowe ratings of the Royal Navy, and the Royal Australian Navy, and fo the petty officers and men, who serve on the public ships of r nations, which visit Sydney from time to time. If this insti were not open to them, these men would be left to their own devie when they came ashore, and they would be exposed to dan temptations and impositions, from which this " House " safeguan them. The special case indicates that the institution would no able to sustain the financial burden of its operations if the upon which it is built had not been granted to it by the State, if it did not receive an annual subsidy from the Commonwealth and donations from the public. The fact that it makes a chal for some of the services which it renders does not destroy its characte as a "benevolent institution" (Borough of Leichhardt v. Mo (1) ).

Seamen engaged on merchant ships have been recognized the Legislature as a class which needs special protection.

the Merchant Shipping Act 1894 contains, inter alia, provisions for the protection of seamen from imposition (secs. 212 and 163). Under sec. 214 the Board of Trade or a local authority may make by-laws relating, inter alia, to the licensing, inspection and sanitary conditions of seamen's lodging-houses. Lodging-house keepers may be fined for charging a seaman for a longer period than that for which he has resided in the house, or for detaining money or effects in payment (sees. 215, 216). It is also an offence to solicit a seaman to become a lodger, within twenty-four hours of the arrival of the ship at a home port, or to go on board for such purpose without leave when a ship is about to arrive, is arriving or has arrived at the end of her voyage (secs. 217, 218). Division 16 of Part IT. of the Navigation Act, passed by the Parliament of the Commonwealth, which is entitled "Protection of Seamen "' contains provisions, a number of which are similar to those which have been made in the Merchant Shipping Act for the protection of seamen, and the Governor-General was empowered by sec. 425 to make regulations, inter alia, for the inspection, management and control of seamen's homes.

It is interesting to recall the views of Lord Chancellor Hardwicke expressed in Baldwin and Alder v. Rochford (1), in which the plain- tiffs who were sailors on board the " Prince Frederic " privateer, "which took a great prize called the ' Marquis D'Antin' the cargo whereof was chiefly gold" claimed that a contract with them for the sale of their prize-money be set aside " upon the foot of imposi- tion and public inconvenience.' His Lordship said : - * There cannot be a more useful set of men to the public, nor a more unthink- ing sort of people, than common sailors, who, as soon as ever they get on shore, for the sake of a little immediate pleasure are willing to part with their right to anything in expectation, for a very little

in possession ; and this is the sense of the Legislature, both from the Stat. 1 Geo. IT., and the 20 Geo. IL.,

notice of them as a set of men not fit to take care of themselves,

and therefore have taken care of them against themselves. I do

not say that every contract with a sailor is void, or ought to be

set aside, but every contract with them must be fair. A sailor

shall not be held to bail for less than £20, and therefore nobody (1) (1748) 1 Wils. K.B. 229, at p. 230; 95 E.R, 589.

1931, Ww PERPEIUAL 'TrustE Co, Lrp. a Feperan Coamus- SIONER OF TAxarion.

will lend one of them twenty shillings unless he gives his n £20, which none of them ever refuse, and do it every day in Wapp which shows what I have before said to be true, that they will d anything for a little ready money to enable them to take

pleasure." The men who resort to this Royal Naval House are placed in such a position by the circumstances of their calling, that they have special need of the assistance which this Royal Naval House pro for them; and while it provides that assistance, in my opinion, t part of an estate which is given to it, is entitled to be exempt estate duty on the ground that the gift is made to an institu of the kind which the Legislature intended to denote by | expression " public benevolent institution." E No argument was addressed to us, on behalf of the appellan support of an affirmative answer to the second part of the quest contained in the special case. Upon the view I have taken, I not deem it necessary to answer that part of the question. The fir part of the question, that is to say, whether the bequest of one-fourtl of the residuary trust funds in the estate to the Royal Naval Hous Grosvenor Street, Sydney, is a bequest to a public bene institution in Australia, should, in my opinion, be answered in affirmative.

Question answered: No. Costs of case ta costs in the appeal. Refer this opinion b to the original jurisdiction. F

Solicitors for the appellant, Dibbs, Parker & Parker. 2 Solicitor for the respondent, W. H. Sharwood, Crown Solicitor fo the Commonwealth.