The parties appeared content to accept that the word "ordinarily" in the Item did not mean that the kind of item was used predominantly for household purposes and, as the matter was not fully argued, I am prepared to accept the view of Davies J and that of the parties that in its context what is required to be considered is settled or ordinary use.
Finally, it may be noted that the Item does not require consideration of whether the relevant kind of goods is ordinarily used in households. The Item requires consideration of "household purposes". It draws attention to the purposes for which the kind of goods are used, not the location of that use. Storage of household valuables will clearly be a household purpose; storage of addictive drugs will not.
Just as in the Diethelm case where the evidence made it clear that there were categories of chairs which included office chairs and domestic chairs (although, at least at the fringes, the categories overlapped), so too in the present case it is clear that there are domestic safes, on the one hand, and industrial and commercial safes, on the other. One difference between the two safes is to be found in the type of goods ordinarily kept in each kind of safe. At the extremes the categories of domestic and commercial or industrial safes are so divergent that, as her Honour recognised, there was a category of safe, namely, commercial and industrial safes, that could not be said to be ordinarily used for domestic purposes. At the other extreme there were clearly safes of which on the evidence it could be said that were used for domestic purposes, indeed, were ordinarily so used, albeit that they were capable of use and, in fact, were used by non-domestic users, e.g. hotels, shops and small businesses. The safe keeping of money, jewellery and valuables and important family papers is clearly a domestic purpose. Perhaps the keeping of large amounts of cash in high security safes might be a different matter.
Her Honour distinguished between the different safes and cabinets largely by reference to the type of contents which they were to house. Thus, where a safe, such as the Anti-Arc safe, was intended to store large sums of money or items of value such as stored by banks, her Honour was of the view, correctly, that such a safe fell outside the Item. So, too, cupboards designed to store business documents fell, in her Honour's view, outside the exemption, as did the security
drug cabinet designed for the security of drugs in dispensaries and hospitals. Her Honour took the view that there was inadequate evidence before her in respect of the record protection files, fire protection cabinets and computer cabinets to enable her to be satisfied that these items were goods ordinarily used for household purposes.
It is clear that, in determining whether a particular safe is of a kind ordinarily used for household purposes, it could be relevant to take into account the intended contents of the safe, its security rating, its size or capacity and, related to these matters, its cost. The answer in a particular case may well be one on which minds may differ, for ultimately the determination whether a particular safe or cabinet falls within the Item is a matter of impression. A matter of degree is involved.
Counsel for the Commissioner criticised some of the findings of her Honour on particular safes by reference to the dimensions or capacity of the safes. It was said that it was unlikely that a safe larger than a large sized refrigerator would be of a kind ordinarily used for household purposes. But if the only matter were size, this of itself would not necessarily lead to the conclusion that the safe was other than of a kind ordinarily used for household purposes. No doubt large safes may be found in large houses and small safes in small houses, but that is not ultimately a determinative
matter. What must be asked is whether the particular safe is of a kind ordinarily used for household purposes.
The Commissioner submitted that the evidence adduced before her Honour went no further than to show the following:
(a) that some households contained freestanding safes, although there was no evidence that the actual safes sold by the taxpayer in the relevant period were contained in households;
(b) that some of the taxpayer's safes were ordinarily sold to hospitals, hotels and dispensaries;
(c) that vendors of other types of safes received enquiries from householders concerning the purchase of safes;
(d) that many of the taxpayer's safes were of a size and capacity that they could not comfortably be accommodated in ordinary household premises; and
(e) that wall and floor safes, which were not furniture, were ordinarily installed in households.
Specifically it was said that there was no evidence to support the conclusion that particular models were of a type ordinarily used for household purposes.
These submissions, with respect, confuse the issue for decision. At issue is not whether the particular safes
sold by the taxpayer were for use in households or were ordinarily used for household purposes, but whether they were of a kind ordinarily used for household purposes. Thus, the fact that there was no direct evidence that particular safes manufactured or imported by Chubb were used in households is irrelevant. In fact, as the summary of evidence given above indicates, the evidence is such as to enable an inference to be drawn that at least some of Chubb's safes were in fact used in households, inferentially for household purposes.
In my view the evidence was such as to permit a conclusion to be drawn in respect of particular models of safes that they were of a kind ordinarily used for household purposes in that they were of a kind used in households to contain and keep safe household valuables, moneys and documents.
In my view it was therefore open to her Honour to find in respect of those goods held to fall within the Item that they were of a kind ordinarily used for household purposes. The finding involved a question of judgment based upon a consideration of the description and in some cases photos or drawings of the relevant safe. No error is apparent in her Honour's judgment, although it is possible that minds could differ as to the outcome in a particular case. The question is thus whether this Court on appeal should interfere with the findings of a trial judge, in a case such as the
present, where the decision was not based upon observations of witnesses but the conclusion depends on impression and no error of law has been demonstrated. A view that it should not was advanced by Beaumont J in Federal Commissioner of Taxation v Smith & Nephew Pty Limited (1994) 94 ATC 4507 at 4513 where the question at issue was whether cotton buds fell within an exemption Item relating to cottonwool. His Honour's comments did not form part of the decision of the other judges in that case.
In support, Beaumont J cited the judgment of Gibbs CJ, with whom Mason J agreed, in S.W. Hart & Co Pty Limited v Edwards Hot Water Systems (1984-85) 159 CLR 466 at 478. That case concerned the issue whether, for the purposes of copyright law, there was substantial similarity between drawings, on the one hand, and three dimensional objects, on the other. The question was clearly one of fact and degree. The trial judge had made the comparison for himself. The appeal court had taken a different view. In allowing the appeal and restoring the judgment of the trial judge the Chief Justice said:
"The nature of the issue, involving as it does matters of impression, is one in which particular respect and weight should be given to the decision of the trial judge unless some error in his judgment has been demonstrated. No such error was demonstrated in the judgment of Brinsden J. I, myself, see no reason to differ from his conclusion. In my opinion, his judgment should not have been disturbed."