The Salvation Army (New South Wales) Property Trust v Chief Commissioner of State Revenue

Solicitors: Dentons (Plaintiff) Crown Solicitor for NSW (Defendant) File Number(s): 2016/00321043 Publication restriction: Nil

Judgment

1. HER HONOUR: In these proceedings, The Salvation Army (New South Wales) Property Trust (the plaintiff) seeks review, pursuant to s 97(1)(a) of the Taxation Administration Act 1996 (NSW) (the Administration Act) of two decisions of the Chief Commissioner of State Revenue (the defendant) in respect of the plaintiff's acquisition on 13 June 2014 of a property at Chalmers Street, Redfern (the Property), which the plaintiff uses as the new headquarters of the Australian Eastern Territory (the AET, comprising NSW, ACT and Queensland) of The Salvation Army.
2. The issues in dispute between the parties are whether an exemption under s 275 of the Duties Act 1997 (NSW) (the Duties Act) applies and, if not, the correct proportion of exemption applicable under s 275A of the Duties Act.

The plaintiff

1. The plaintiff is a body corporate established by ss 3 and 4 of The Salvation Army (New South Wales) Property Trust Act 1929 (NSW) (The Salvation Army Act), with the powers set out in that Act (see ss 7-9 of The Salvation Army Act). Vested in the plaintiff pursuant to s 7 of The Salvation Army Act was all real and personal property then held upon the trusts of the deeds poll recited in the recitals to the Act: those being, first, a deed poll dated 7 August 1878 - the Deed of Constitution - as amended by a deed of 26 July 1904 (establishing what is referred to as the "General Work Trust") and, second, a deed poll dated 1 June 1920 (establishing what is referred to as the "Social Work Trust").
2. Under the Deed of Constitution, property was acquired and held "for the general purposes" of the "religious Community or Mission" founded by William Booth in 1865 (then known as The Christian Mission), for the benefit of the said Christian Mission. This is recognised by both parties as establishing a purpose trust (the General Work Trust), the objects of which are not confined to social work, and include religious purposes.
3. Under the 1920 deed poll (the Social Work Deed), property was to be held on trust for purposes devoted exclusively to the social work of The Salvation Army (hence it is referred to as the Social Work Trust). Again, both parties accept that the Social Work Deed established a purpose trust.
4. The nature of the two purpose trusts and the effect of The Salvation Army Act were considered by Street J (as his Honour then was) in Warringah Shire Council v Salvation Army (NSW) Property Trust (1943) 15 LGR (NSW) 91 (at 97-99) ("Warringah Shire Council"). His Honour said (at 99): In the first place, it appears that every asset in New South Wales which belonged to the Salvation Army in the year 1929 … vested in the Trustees, who were to hold the same for the various purposes of the Army. Secondly, it appears that by virtue of the provisions of the Act, and the incorporation therein, by reference, of the provisions of the three deeds poll referred to, that the widest powers of management and control were given to the Trustees for the purpose of furthering the aims and objects of the Salvation Army, either on its religious side or in its Social Work.
5. In Warringah Shire Council, his Honour concluded that the real purpose and design of The Salvation Army Act was to vest the title to the whole property belonging to "The Salvation Army" in New South Wales in the trustees "for the purpose of convenience of management and administration, and for facilitating the use or disposal of any such property", and that the object of the creation of the plaintiff as a statutory corporation was "to render certain the title of all the Army's property and assets in this State". His Honour said, in that regard (at 99): The whole of the legal estate in these assets having been vested in the Trustees, it was also necessary to provide that they should have the widest powers of dealing with the property in such a manner as to further the aims and purposes of the Salvation Army, and they were therefore given the fullest powers in this respect. But in whatever they did under those powers, the benefit must go to the Salvation Army, and so far as the beneficial interest is concerned, that remained in the Army, being protected by the right of control possessed by the General, and the specific powers given to him by the Act. The Trustees in one sense are agents for the Army, although this is not an accurate way of describing their legal position. The fact that the title of the property was vested in them constituted them, in name and in fact, as trustees, but the whole of their powers were designed to be exercised for the single purpose of furthering the aims and objects of the Army, and under the control and power of direction possessed by the Army through the General. While the legal ownership was in the Trustees, the beneficial ownership in every sense of the term was in the Salvation Army, and the Legislature itself by the language which is [sic] has used ... clearly recognized that it was the Salvation Army which was properly to be regarded as the body beneficially entitled under the trusts created by the Act in question.
6. Pausing here, the defendant places emphasis on the fact that, by The Salvation Army Act, the plaintiff became a trustee of two separate and distinct purpose trusts (those being the General Work Trust and the Social Work Trust) and that the property of The Salvation Army, situated in NSW, is vested in and held by the plaintiff in the plaintiff's capacity as trustee of one or other of the two separate trusts, some property being held by the plaintiff in its capacity as trustee for the purposes of the General Work Trust and some in its capacity as trustee for the purposes of the Social Work Trust. The defendant argues that property held by the plaintiff, as trustee, must be both held and dealt with by the plaintiff in that particular capacity according to the relevant purpose trust upon which the relevant property is held.
7. The plaintiff does not dispute that it holds the Property, in its capacity as trustee of the General Work Trust, for charitable purposes (more precisely, perhaps, as trustee for the so-called "general work" purposes provided for under the Deed of Constitution as amended); but it submits that it is trustee for the "institution" known as The Salvation Army AET (or alternatively for the institution known as The Salvation Army in Australia - i.e., for the AET and AST combined - see [12] below) and it argues that it is thus an exempt charitable or benevolent body within the definition of that term in sub-s 275(3) of the Duties Act.

The Salvation Army

1. The Salvation Army movement originated in the United Kingdom in or around 1865. There is no dispute between the parties that it is now an international movement and that its international headquarters (the IHQ) is in London. Kelvin Pethybridge, the Chief Secretary in Charge of The Salvation Army AET (see below at [12]), with the most senior rank within the AET, has deposed in his affidavit of 24 February 2017 (the First Pethybridge affidavit) that The Salvation Army uses "military-style terminology" to describe the role of its members, to represent the battle being waged against poverty and sin (at [4]). Kelvin Pethybridge is an ordained minister in The Salvation Army with the rank of Lieutenant Colonel and a trustee of the plaintiff (see [1], [3], [4] of the First Pethybridge affidavit). I will refer to him, by reference to his position in The Salvation Army, as Lt. Col. Pethybridge.
2. At the head of The Salvation Army is the "General", who directs The Salvation Army's operations throughout the world, in collaboration with the IHQ. The Salvation Army's International Mission Statement is as follows (see [19] of the First Pethybridge affidavit): The Salvation Army, an international movement, is an evangelical part of the universal Christian Church. Its message is based on the Bible. Its ministry is motivated by love of God. Its mission is to preach the gospel of Jesus Christ and meet human needs in His name without discrimination.
3. The organisation of the international Salvation Army movement is separately arranged on largely geographical lines. In Australia, the movement is divided into two Territories: the Australian Eastern Territory (or AET) (which, as already noted, comprises NSW, the ACT and Queensland) and the Australian Southern Territory (AST) (which comprises Victoria, South Australia, Tasmania, Western Australia and the Northern Territory). The AET is administratively separate from the AST. The two Territories report separately to the IHQ and each publishes a separate audited annual report. The AET and AST jointly fund a National Secretariat.
4. Further by way of general background, I note that The Salvation Army was described in Warringah Shire Council (at 95-96) as follows: [T]he Salvation Army is both a religious and social organization and its work falls broadly under two main headings. The first of those may be called the evangelistic side, and from this aspect the Army is a religious institution with a definite profession of faith based on the Christian gospels ... Services ... are held … the sick and needy are visited … this is one side of the Army's mission which is here concerned with the things of the spirit. The other side is concerned with its social work, though it is of course impossible to draw any strict line of demarcation. The religious beliefs and ideals of the Salvation Army find their expression, not only in its teachings, but also in the services to humanity rendered by members of the Army as a result of those beliefs. It is a creed of faith and a creed of works, based on the recognition of the fact that man is a physical as well as a spiritual being, and the salvation of the soul needs to be accompanied by the salvation of the mind and the body. So the Army seeks to succour the needy, the destitute, the outcast and the unfortunate, and to care for and comfort, within the limits of its ability, all those who are unable to protect themselves. Extensive social work is done amongst the young, orphanages are maintained, maternity hospitals provided for expectant mothers, and homes and hostels care for the old and the indigent of both sexes. In these, and many other ways too numerous to mention, the Salvation Army and its individual members seek to give practical expression to that spirit of love for humanity which its religious beliefs teach and inspire. They seek to provide for man's material as well as his spiritual well-being, and this material side of the Army's ministrations is known as its social work.
5. There appears to be no dispute as to the above being a fair description of the work of The Salvation Army. His Honour went on to note that: Now, in the philanthropic branch of its activities ... it is obvious that money has to be expended and premises provided in order that the social work of the Army may be carried on. Land has been acquired, buildings have been erected, staffed and maintained, and provision made for all the services supplied to the poor and the sick and the needy. Problems in regard to title and devolution arose in relation to those properties, and other difficulties were encountered, and in 1929 the Salvation Army (N.S.W.) Property Trust Act was passed by the Parliament of New South Wales.

Acquisition of the Property

1. On 13 June 2014, the plaintiff entered into two contracts to acquire the respective lots comprising the Property. The plaintiff did so "in its capacity as trustee of the General Trust from funds held in that trust" (see [30] of the First Pethybridge affidavit). In cross-examination it was clarified with Lt. Col. Pethybridge that the funding was by way of internal loans from funds within the general funds (see T 22.20-37), the repayment of which was to be met from the rent generated from existing leases in place in relation to parts of the Property (see [19] below) (T 23.44).
2. Lt. Col. Pethybridge has deposed that the purpose of the acquisition was to use the premises as the new territorial headquarters (the THQ) for The Salvation Army AET, so as to accommodate all headquarters staff and functions in the one building (see [28]-[31] of the First Pethybridge affidavit). Lt. Col. Pethybridge has deposed that of the 440 Salvation Army employees based at the THQ, 370 (84%) were employed for the Social Work side of The Salvation Army and 70 (16%) for the General Work side (at [36] of the First Pethybridge affidavit, and confirmed in cross-examination at T 23.48-24.24).
3. According to Lt. Col. Pethybridge, the acquisition of the Property was made in the plaintiff's capacity as trustee of the General Work Trust because the THQ accommodates staff that carry out activities in pursuance of both The Salvation Army's religious objectives and its charitable objectives (see [30] of the First Pethybridge affidavit). He has deposed that the trustees of the plaintiff determined that the objects of the General Work Trust, which are both religious and charitable, "more conformably accommodated the NSW Property Trust acquiring and holding the new THQ in its capacity as trustee of the General Work Trust rather than as trustee of the Social Work Trust (which has as its objects social work only)" (First Pethybridge affidavit at [30]).
4. Lt. Col. Pethybridge has deposed that the new THQ serves as an administrative office for all of The Salvation Army's various social work programs. The preliminary planning report prior to the acquisition noted the intention to use the Property as the THQ for the AET, providing "office premises, a place for community and welfare support and … a place of worship" (First Pethybridge affidavit at [31]).
5. Parts of the Property (representing approximately 35% of the total area) are the subject of registered leases (the current terms of which will expire in 2020 and 2030, respectively) to South Sydney District Rugby League Football Club Ltd (Souths) and Woolworths Ltd (Woolworths). Those leases were granted prior to the plaintiff's acquisition of the Property. The plaintiff acquired its freehold title to the Property subject to those leasehold interests. Lt. Col. Pethybridge has deposed that it is the intention of The Salvation Army AET to occupy the parts of the premises that are presently let to Woolworths and Souths when those leases expire (see First Pethybridge affidavit at [34]). In cross-examination, Lt. Col. Pethybridge accepted that in both leases there are option clauses and that, if the options were to be exercised, the time at which The Salvation Army AET could occupy those parts of the premises would be later (potentially as late as 2070 in the case of the Woolworths lease) (see T 20.41-21.28).
6. The rent received under the respective leases is allocated to the General Work Trust fund for accounting purposes and is used to meet expenses associated with The Salvation Army, most of which relate to social work programs (see First Pethybridge affidavit at [35]). In cross-examination, Lt. Col. Pethybridge confirmed that The Salvation Army's evangelical programs are not funded by the Social Work Trust, but programs such as the social program, aged care, employment and youth training, recycling operations and Red Shield Appeal are funded out of the Social Work Trust (see T 24.37-42).

Lodgement for stamp duty and relevant decisions by Chief Commissioner

1. On 24 June 2014, the plaintiff lodged the contracts for stamping. It paid the amount of $2,557,344 by way of ad valorem duty on the aggregated dutiable value of the Property ($46,760,800) and additional duty of $110 on the second contract, counterpart contracts and transfers. In October 2014, the plaintiff lodged an application with the defendant for an exemption from duty in respect of its acquisition of the Property under s 275(3)(b) of the Duties Act.
2. By email dated 15 August 2015, the defendant disallowed the application for exemption, determining that the plaintiff was not an "exempt charitable or benevolent body" within the meaning of s 275(3)(b) of the Duties Act. The defendant determined that the plaintiff was liable to pay duty on the "dutiable value" of the Property, but determined that the portion of the Property used, or to be used, for an exempt purpose was 65% and hence that the dutiable value of the Property would be reduced by that proportion under s 275A of the Duties Act. The defendant calculated that the reduced dutiable value of the Property was $16,366,280, and assessed the plaintiff to ad valorem duty on that reduced dutiable value in the amount of $885,636.50, plus $50 on the second contract. (The 15 August 2015 decision is the first of the decisions under review in the present proceedings.)
3. On 2 October 2015, the plaintiff lodged a notice of objection to the defendant's decision made on 15 August 2015. By letter dated 11 March 2016, the defendant disallowed the plaintiff's objection.
4. By letter dated 23 August 2016, the plaintiff's solicitors requested that the defendant reassess the plaintiff's acquisition of the Property having regard to the submissions outlined in that letter (including a submission by reference to s 275(3)(c) of the Duties Act), and enclosed an application for exemption under s 275(3)(a) of the Duties Act.
5. By letter dated 30 August 2016, the defendant disallowed the plaintiff's application for exemption under s 275(3)(a) of the Duties Act, determining that the plaintiff was not an "exempt charitable or benevolent body" within the meaning of s 275(3)(a) and/or s 275(3)(c) of the Duties Act. (This is the second of the decisions under review.) By letter dated 1 September 2016, the defendant notified the plaintiff of the disallowance of the plaintiff's objection lodged on 2 October 2015, having regard to the additional submissions.
6. An objection to the disallowance of the application for exemption under s 275(3)(a) and (c) of the Duties Act was lodged on 6 October 2016. That objection was disallowed by the defendant by letter dated 10 October 2016.

Evidence on the present application

1. As adverted to earlier, on the present application the plaintiff relied upon evidence from Lt. Col. Pethybridge as to various matters in relation to the operations of and services provided by The Salvation Army.
2. His evidence is that the key services provided by The Salvation Army in the AET for the relief of poverty (see First Pethybridge affidavit at [48]) include the provision of crisis accommodation, community housing and student accommodation for the homeless, those suffering from domestic violence, and those in financial need (accounting for approximately 20% of the expenditure of The Salvation Army's social programs in the 2015-2016 period); disaster relief; recovery services for those adversely affected by alcohol, drugs and gambling (this accounting for the largest portion of expenditure in the 2015-2016 period, amounting to some $31.5 million); and various other services and programs (including the provision of free legal advice, on a means-tested basis, across a range of practice areas through "Salvos Legal").
3. Excluding expenses attributed to overseas aid expenditure and evangelical programs, Lt. Col. Pethybridge's evidence is that 89% of The Salvation Army's overall expenditure in 2016 was directed at social work and the alleviation of poverty in Australia (that proportion being 90%, 92% and 91% in the years 2015, 2014 and 2013, respectively) (see First Pethybridge affidavit at [41]).
4. Summarising data from the plaintiff's payroll information records, Lt. Col. Pethybridge says that, on average, over the period 2014-2016, 75% of the total number of employees of The Salvation Army AET were employed in the social work side of The Salvation Army's operations. Expenditure in that period for employees and officers engaged in the "General Work" of The Salvation Army AET represented 20% of total expenditure (by reference to the table at [37] of the First Pethybridge affidavit).

Powers of the Court upon review

1. The plaintiff seeks review of the defendant's decisions pursuant to s 97(1)(a) of the Administration Act. The powers of the Court upon an application for review are stated in s 101(1). The Court may do any one or more of the following: (a) confirm or revoke the assessment or other decision to which the application relates, (b) make an assessment or other decision in place of the assessment or other decision to which the application relates, (c) make an order for payment to the Chief Commissioner of any amount of tax that is assessed as being payable but has not been paid, (d) remit the matter to the Chief Commissioner for determination in accordance with its finding or decision, (e) make any further order as to costs or otherwise as it thinks fit.
2. The High Court considered the nature of review pursuant to s 97(1)(a) in Tasty Chicks Pty Ltd v Chief Commissioner of State Revenue of the State of New South Wales (2011) 245 CLR 446; [2011] HCA 41. At [15]-[17] of its reasons, the Court sets out the statutory framework applicable to this review where it is undertaken by the Supreme Court, as follows: Section 19(2) of the Supreme Court Act 1970 (NSW) renders proceedings in the Supreme Court under s 97 of the Administration Act an "appeal" for the purposes of the Supreme Court Act if so described in the Administration Act. Section 97(4) of the Administration Act then engages s 19(2) of the Supreme Court Act by stating: "A review by the Supreme Court is taken to be an appeal for the purposes of [the Supreme Court Act] and the regulations and rules made under that Act, except as otherwise provided by that Act or those regulations or rules." Part 7 (ss 101-110) of the Supreme Court Act deals with "appeals" from the Supreme Court itself and is not picked up by operation of s 97(4) of the Administration Act. However, s 75A of the Supreme Court Act applies to "appeals" from administrative bodies. Section 75A is "picked up" by dint of s 97(4) of the Administration Act, along with relevant regulations and rules made under the Supreme Court Act. The qualification in s 75A(4) of the Supreme Court Act that s 75A "has effect subject to any Act" directs attention to the particular provisions of ss 100 and 101 of the Administration Act to which reference has been made above. These are supplemented by s 75A(7) (the Supreme Court may receive further evidence) and s 75A(1) (the Supreme Court may make any assessment which ought to have been made).
3. The High Court concluded that, reading those provisions together, the Supreme Court was empowered to set aside the disallowance by the Chief Commissioner of the appellants' objection in that case, to allow the appellants' objection, to set aside the determination of the Chief Commissioner not to exercise a particular statutory discretion, to revoke the assessments, and to require reassessments by the Chief Commissioner (at [18]) (see also Milstern Nominees Pty Ltd v Chief Commissioner for State Revenue (2015) 89 NSWLR 43; [2015] NSWSC 68 per White J, as his Honour then was, at [4]).
4. Those same powers are available to the Court in this case with respect to "the assessment or other decision to which the application relates" (Administration Act s 101(1)), namely, the defendant's decisions of 15 August 2015 and 30 August 2016 to disallow the plaintiff's applications for exemptions pursuant to s 275 of the Duties Act.

Legislation

1. There is no dispute that the acquisition of the Property was a dutiable transaction under Chapter 2 of the Duties Act. Chapter 11 of the Act, in which ss 275 and 275A appear, contains general exemptions from duty.
2. Section 275 relevantly provides: 275 Charitable and benevolent bodies (1) Duty under this Act is not chargeable on the following: (a) a transfer, or an agreement for the sale or transfer, of dutiable property to an exempt charitable or benevolent body, … (3) In this section: exempt charitable or benevolent body means: (a) any body corporate, society, institution or other organisation for the time being approved by the Chief Commissioner for the purposes of this paragraph whose resources are, in accordance with its rules or objects, used wholly or predominantly for: (i) the relief of poverty in Australia, or (ii) the promotion of education in Australia, or (b) any body corporate, society, institution or other organisation that, in the opinion of the Chief Commissioner, is of a charitable or benevolent nature, or has as its primary object the promotion of the interests of Aborigines and if: (i) (in the application of this definition for the purposes of subsection (1) or (1A)) the dutiable transaction or instrument is for such purposes as the Chief Commissioner may approve in accordance with guidelines approved by the Treasurer, or … (c) any person acting in the person's capacity as trustee for a body corporate, society, institution or other organisation referred to in paragraph (a) or (b).
3. As to s 275(3)(b), a copy of the guidelines currently approved by the Treasurer was in evidence (see Annexure A to the affidavit of Mr Robert Forsyth, an employee of the NSW Office of State Revenue) (the Guidelines). The Guidelines relevantly provide (at [1]) that "approved charitable and benevolent purposes" include the relief of poverty and the promotion of education.
4. Paragraph 3 of the Guidelines provides that: 3. In relation to transactions and instruments other than vendor duty transactions: (a) The transaction for which exemption is claimed must relate to property to be used for the charitable or benevolent purposes of the organisation. It cannot be let or sold for profit. (b) Property acquired for use as the headquarters of an approved organisation will be eligible for exemption if the use of the property is part of continuing charitable or benevolent work. (c) A transaction by which property is donated will be eligible for exemption if it is to be used for approved purposes, or is to be sold and the proceeds applied to a specific proposal which is for approved purposes. (d) Property acquired by religious organisations must be used for approved charitable and benevolent purposes of the organisation and not for predominantly religious purposes.
5. The defendant's Revenue Ruling No. DUT 034 ("Exemption from Duty - Charitable and benevolent bodies") (Ruling), which outlines the guidelines currently approved by the Treasurer (at [4]), adds a parenthetical suffix to 18 of the Ruling (which otherwise reflects 3 of the Guidelines), namely that: "[a] transaction is not ineligible merely because the property is subject to an existing short term lease or a short term lease back to the vendor". (It is not suggested that the leases to Woolworths and Souths are short-term leases.)
6. As to s 275(3)(c), this was introduced into the legislation in 2008, at which time s 275(3)(a) was expanded. I consider the legislative history of the relevant provisions later in these reasons. Suffice it here to note that in both of the ways that the plaintiff's claim for exemption is put reliance is placed on the application of sub-paragraph (c). The plaintiff did not seek to maintain a claim for exemption based on sub-paragraph (a) alone. The defendant argues that s 275(3)(c) is not here applicable; rather that this primarily applies to a trustee who acts as, in effect, a "bare" trustee (not effectuating the relevant qualifying purpose(s) in s 275(3)(a) of the Duties Act itself, but merely acquiring or holding assets for the relevant "body corporate, society, institution or other organisation" who uses its resources to itself effectuate the qualifying purpose of "relief of poverty" or the "promotion of education"). The defendant emphasises the legislative history of the relevant provision in this regard (to which I turn in due course).
7. Section 275A of the Duties Act relevantly provides that: 275A Partial exemption for certain transactions by charitable and benevolent bodies (1) If the Chief Commissioner is satisfied, in relation to any dutiable transaction by which an exempt charitable or benevolent body acquires land or an interest in land, that the land concerned is used or to be used by the charitable or benevolent body partly for an exempt purpose, the dutiable value of the land concerned is, for the purposes of charging duty under Chapter 2 or 2A, to be reduced by the portion of that dutiable value that is referable to the portion of the land used or to be used for an exempt purpose. … (6) This section does not limit section 275. (7) In this section: charitable or benevolent body means any body corporate, society, institution or other organisation that, in the opinion of the Chief Commissioner, is of a charitable or benevolent nature, or has as its primary object the promotion of the interests of Aborigines. exempt purpose means a purpose approved by the Chief Commissioner under section 275.
8. Section 6 of the Duties Act provides that: "[w]ords and expressions used in this Act (or in any particular provision of this Act) that are defined in the Dictionary at the end of this Act have the meanings set out in the Dictionary". The Dictionary provides that "land" includes a stratum.
9. Section 21(1) of the Interpretation Act 1987 (NSW) (the Interpretation Act) provides that: land includes messuages, tenements and hereditaments, corporeal and incorporeal, of any tenure or description, and whatever may be the estate or interest therein.
10. "Property" is not defined in the Duties Act but is defined in the Interpretation Act as "any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description, including money, and includes things in action".

The plaintiff's contentions

1. The plaintiff's primary case for exemption relies upon a combination of sub-paragraphs (a) and (c) in the definition of the term "exempt charitable or benevolent body" in s 275(3).
2. In essence, the plaintiff says that, applying sub-paragraph (c): it is a trustee; it is acting in its capacity as a trustee for an "institution or other organisation" (that institution or organisation being identified by it as The Salvation Army AET or, in the alternative, The Salvation Army in Australia as a whole); and that The Salvation Army AET is an institution or other organisation referred to in sub-paragraph (a). That is, the plaintiff submits that The Salvation Army AET (or The Salvation Army in Australia) is an institution "for the time being approved" by the defendant for the purposes of sub-paragraph (a) whose resources are used wholly or predominantly for the relief of poverty in Australia, thus satisfying sub-paragraph (a)(i).
3. The plaintiff's secondary case for exemption relies on a combination of sub-paragraphs (b) and (c) of the definition in s 275(3), namely that: (again) it is a trustee; it is acting as a trustee for The Salvation Army (an institution); The Salvation Army (not the territorial institution but the institution as a whole) is an institution that, in the opinion of the defendant, is of a charitable or benevolent nature; and the dutiable transaction or instrument is for such purposes as the defendant "may approve in accordance with guidelines approved by the Treasurer". That is, the dutiable transaction or instrument is for the purpose set out at 3 of the Guidelines: use as the headquarters of an approved organisation if the use of the property is part of the continuing charitable or benevolent work.
4. If neither its primary nor secondary case is made out, then the plaintiff's tertiary case is one based on s 275A of the Duties Act, namely, that it is entitled to a partial exemption because the land is being used partly for an exempt purpose. The plaintiff does not argue for a greater reduction than that which was in fact allowed by the defendant (65%). However, the defendant now says that the exemption should have been lower (a proposition resisted by the plaintiff - see T 7.32) because there is a meeting room in part of the THQ which is described on the floor plans for the THQ as "Prayer/Flexible Seminar Room" and which is used from time to time for religious services (and which is referred to in the defendant's submissions as "the Chapel").
5. Lt. Col. Pethybridge, in his affidavit sworn 10 August 2017 (at [15]-[18]) describes the use made of this room. He deposes that it: is predominantly used for workplace seminars and meetings; is also used for religious services; and is not generally available to the public and not promoted to the public but will generally be made available on request by a member of the public (whether for a meeting or religious service) if it is available and the intended use does not cause undue inconvenience. He says that it is used on a daily basis for workplace seminars and meetings; is used once a week for an "informal spiritual meeting for all staff" (including scripture and informal discussion to farewell and welcome staff and recognise any staff achievements); and is used for a weekly event every Friday night for a gathering over two hours for disadvantaged persons in the community (including a free meal) after which there is a half hour religious service.

Plaintiff's submissions

1. On its primary case (based on a combination of s 275(3)(a) and (c)), the plaintiff identifies three issues which arise between the parties. First, the identification of the relevant "body corporate, society, institution or other organisation" for the purposes of applying the definition of "exempt charitable or benevolent body". Second, whether the resources of the relevant body are, in accordance with its rules or objects, used wholly or predominantly for the relief of poverty in Australia. Third, whether the body is one that is "for the time being approved" by the defendant for the purposes of s 275(3)(a).

First issue: identification of the relevant body

1. The plaintiff submits that where one finds an entity which potentially falls both within s 275(3)(c) (as a trustee) and within s 275(3)(a) (as a body corporate itself, as every corporate trustee must be), the "appropriate approach" is to ask upon which is the relevant entity to focus (T 6.43). On the plaintiff's submission, in a case such as this, where the plaintiff in its trustee capacity is acting for the benefit of a body which itself falls within s 275(3)(a), one focuses upon the latter body.
2. There is no dispute that the plaintiff is a legal "person" nor that it is acting in its capacity as trustee (as required by s 275(3)(c)). However, the defendant submits that s 275(3)(a) is the "most relevant" paragraph (T 43.33). According to the defendant, in circumstances where sub-paragraph (a) exists, and where the plaintiff is not a mere or bare trustee but performs activities, the plaintiff is the relevant institution identified in sub-paragraph (a) and "one needs to look no further" (T 43.36).
3. The plaintiff accepts that there is an overlap, and that sub-paragraphs (a) and (c) both have potential application. However, the plaintiff says that the correct approach in the case of a taxpayer, as a transferee of property, who is a trustee, is to start with sub-paragraph (c), because the ordinary words of the statute direct attention, in a case where a person is a trustee, to the question as to for which entity or for what purposes it is a trustee, and that entity is the relevant entity for sub-paragraph (a). The plaintiff gives three reasons for looking first to sub-paragraph (c). First, that this is a sensible construction of sub-s 275(3) which makes it work where one would otherwise have had overlap. Second, that sub-paragraph (c) is the more specific in the case of a trustee, so one starts with sub-paragraph (c) and then applies sub-paragraph (a) by reference to the entity for which it is trustee. Third, that where there is more than one body which could be characterised as the relevant body, one has to determine which is more aptly described as the body which promotes the charitable purpose; that construction being consistent with the purpose of s 275 as an exemption for charitable work of a particular kind, which should not be narrowly construed.
4. On the premise that one starts with s 275(3)(c), the question the plaintiff then must address is for which "body corporate, society, institution or other organisation" it is acting as trustee. The plaintiff says that it is acting as trustee for the institution or other organisation of The Salvation Army AET or, alternatively, The Salvation Army in Australia as a whole. The defendant contends that the plaintiff is acting as trustee "for the purposes of the body corporate, society, institution or other organisation being the instrument carrying the charitable purposes into effect" (i.e., for the purposes of The General Work Trust not "for" the institution or organisation known as The Salvation Army AET or The Salvation Army as a whole, as the case may be). The defendant says that it is not possible for any person to be a trustee "for" a society, institution or other organisation that is not a juristic person.
5. It is not disputed that the plaintiff acquired the Property in its capacity as trustee of the General Work Trust, but the plaintiff says that the fact that it acquired the Property in that capacity does not preclude it from being an exempt charitable or benevolent body.
6. The plaintiff submits that the General Work Trust (or "the [Salvation Army] AET to the extent that it effectuates the purposes of the general work trust") is not the institution or other organisation for which it is acting as trustee for the purposes of s 275(3). Rather, the plaintiff says that, under the General Work Trust, it acts as trustee for the purposes of The Salvation Army. It argues that The Salvation Army is an "institution or other organisation" engaged in both religious and social work (referring to the observations of Street J in Warringah Shire Council at 95). It submits that, given the structure of The Salvation Army in Australia, the relevant "organisation" for the purposes of s 275(3)(a) is The Salvation Army AET. However, it accepts that the relevant organisation might also be regarded as The Salvation Army in Australia (i.e. the AET and the AST combined). Pausing there, I note that the defendant appears to accept that "The Salvation Army" may be regarded as an institution (see T 57.17 and defendant's outline of submissions at [61] and [79]), but disputes the characterisation of The Salvation Army AET or The Salvation Army as the relevant institution for which the plaintiff is trustee. The defendant effectively says that, where there are two separate trusts (although accepting that there is some overlap between the General Work and Social Work Trusts), there are two separate "institutions" for which the plaintiff is trustee, for the purposes of s 275(3)(c).
7. The plaintiff notes that the meaning of the term "institution" in s 275(3)(a) of the Duties Act was considered by Gzell J in Sargents Charitable Foundation Ltd v Chief Commissioner of State Revenue [2005] NSWSC 659; (2005) 60 ATR 129 (at [11]ff) and that his Honour there (at [15]) referred to the reasons of Gibbs J, as his Honour then was, in Stratton v Simpson (1970) 125 CLR 138, which included the following passage at 158: In its ordinary sense 'institution' means 'an establishment, organization, or association, instituted for the promotion of some object, especially one of public utility, religious, charitable, educational etc.' (The Shorter Oxford English Dictionary). It means, as was said in Mayor etc. of Manchester v. McAdam [[1896] AC 500 at 511], 'an undertaking formed to promote some defined purpose ...' or 'the body (so to speak) called into existence to translate the purpose as conceived in the mind of the founders into a living and active principle'. Although its meaning must depend on its context, it would not ordinarily connote a mere trust (cf. Minister of National Revenue v. Trusts and Guarantee Co. Ltd). A school could appropriately be called an institution within the ordinary meaning of the word. [Emphasis as per the plaintiff's submissions.]
8. The plaintiff also refers to Minister of National Revenue v Trusts and Guarantee Company Ltd [1940] AC 138, where the Privy Council (at 149-150) said that an ordinary trust for charity is only a charitable institution in the sense that a farm is an agricultural institution, which observation the plaintiff says is also applicable to the reference to an institution in s 275(3)(a).
9. The plaintiff draws from these authorities the proposition that a charitable trust is not, per se, an institution because a mere trust is not an institution; and that something more is required. In the case of the General Work and Social Work Trusts (which are undoubtedly charitable in nature), the plaintiff says something more would be required to make them institutions.
10. The plaintiff notes that, in Sargents, Gzell J (referring to Commissioner of Land Tax (NSW) v Joyce (1974) 132 CLR 22, which was concerned with whether a trustee holding land used for charitable purposes was an "institution") observed (at [19]) that the High Court had concluded that the taxpayers in Commissioner of Land Tax (NSW) v Joyce "were no more than simple trustees and possessed no quality or function that could justify their being described as an institution". Gzell J concluded (at [25]) that "the feature that is lacking in the instant circumstances is the establishment, organisation or association created to bring to fruition the purpose conceived by the founders of the Foundation".
11. In the present case, the plaintiff contends that it is common ground that the members of the unincorporated association described as The Salvation Army are the people that carry out or effectuate the charitable objects and purposes for which the General Work Trust and the Social Work Trust were established by The Salvation Army Act.
12. The plaintiff says that it has never been its case that it holds the Property on trust for persons and that to say that the plaintiff holds the Property on trust for the purposes of The Salvation Army AET is not to say that the plaintiff is a trustee for persons; rather, it is to adopt a common description of a trust for charitable purposes.

Second issue: resources used wholly or predominantly for specified purpose

1. As to the second issue, whether the resources of the relevant institution or organisation (be that The Salvation Army AET or The Salvation Army in Australia) are, in accordance with its rules or objects, used wholly or predominantly for one of the purposes set out in s 275(3)(a)(i) and (ii), the plaintiff submits that sub-paragraph (a)(i) is satisfied in the present case.
2. The plaintiff argues that it is evident from the context in which The Salvation Army Act was enacted, and the terms of the Act itself, that the plaintiff's rules and objects include the promulgation of various operations for the social, temporal and moral welfare of the poorer and needy classes. This does not appear to be disputed by the defendant.
3. The plaintiff argues that the "resources" of The Salvation Army AET comprise the assets comprising the corpus of the General Work Trust and the Social Work Trust, as well as its people (employees and volunteers of The Salvation Army movement). It says that it is evident that the resources of The Salvation Army AET are almost exclusively used "in Australia" and that the requirement that the resources are used "wholly or predominantly" for relief of poverty and promotion of education is satisfied in circumstances where approximately three-quarters of the plaintiff's financial and personnel resources are used to conduct the social work, which has the object of relieving poverty. Hence it is submitted that its resources are predominantly used to relieve poverty and that the second criterion is satisfied.
4. Alternatively, if the relevant organisation for present purposes is The Salvation Army in the whole of Australia (i.e., the AET and AST combined), the plaintiff says that the result is the same because approximately 75% of the (combined) financial and personnel resources of the AET and AST is used to achieve the object of relieving poverty.

Third issue: "for the time being approved"

1. As to the third issue (whether the institution or organisation is one that is "for the time being approved" by the defendant), the question raised here is whether such approval must be applied for, and may only be granted, prospectively (having regard to the phrase "for the time being"). The defendant argues that approval must be applied for and granted before the time that liability to duty arose (defendant's outline of submissions, [98]-[99]). The plaintiff argues that the defendant's position in the present proceedings on this issue is inconsistent with the Ruling that approval may be granted retrospectively for up to a period of three months (DUT 034 at [15]). The plaintiff further notes that the Court stands in the shoes of the defendant in any appeal and thus may remake the decision to approve the plaintiff for the purposes of s 275(3)(a).
2. The plaintiff argues that various dictionary definitions of the phrase "for the time being" connote an indefinite period, referring to The Oxford English Dictionary (Online Edition) definition of the phrase as "(in office, etc) for the present time, during the period under consideration; until some other arrangement is made"; and referring to the following in Stroud's Judicial Dictionary of Words and Phrases (9th ed, 2016) at 2594: The phrase "for the time being" may according to its context, mean the time present, or denote a single period of time; but its general sense is that of time indefinite, and refers to an indefinite state of facts which will arise in the future and which may (and probably will) vary from time to time (Ellison v Thomas (1862) 31 LJ Ch 867; 32 LJ Ch 32; Coles v Pack, LR 5 CP 65).
3. The plaintiff also notes that the Macquarie Dictionary (6th ed, 2013) definition of "time" includes: "4. a particular period considered as distinct from other period: for the time being".
4. As to the authorities referred to in the passage extracted above from Stroud's Judicial Dictionary, in Ellison v Thomas (1862) 32 LJ Ch 32, where the issue arose in relation to the construction of a will, Westbury LC said (at 34) that the words "for the time being" are appropriately used where "a future period is referred to, and it is desired to designate the person who fills a particular character at that period"; and in Coles v Pack (1869) LR 5 CP 65 it was held that the words "for the time being" in the definition of the amount secured by a guarantee referred to a future time, and thus the guarantee was unlimited as to time (at 70-71).
5. As to the meaning of the verb "approve", the plaintiff refers to the following dictionary definitions: the Oxford English Dictionary (Online Edition): "to make good (a statement or position); to show to be true, prove, demonstrate"; Macquarie Dictionary (6th ed, 2013): "1. To pronounce or consider good; speak or think favourably of, … 2. to confirm or sanction officially."
6. The plaintiff argues that, in the present context, the phrase "approved by the Chief Commissioner for the purposes of this paragraph" means simply that the defendant must have decided "as at the relevant time" that the relevant body or organisation is one whose resources are used in the way specified in sub-paragraph (a). The plaintiff argues that there is no reason in principle why that time needs to be at or before the dutiable transaction occurs; rather, the plaintiff says that it is sufficient that the approval is given by the defendant at or before the time of the objection decision, or, following an adverse objection decision, by this Court in an appeal pursuant to s 97 of the Administration Act. The plaintiff submits that there is no discretion conferred on the defendant in relation to such approval; rather, what is required is a determination as to whether the body meets the first and second criteria in s 275(3)(a).
7. The plaintiff argues that such a construction promotes the object of the exemption, namely to exempt dutiable transactions of exempt charitable entities from duty where the first and second criteria are both met. It argues that denying an exemption for a charitable entity which fails to obtain approval before the dutiable transaction occurs does not promote that object (and would simply reward more sophisticated qualifying charities from those that are less sophisticated).
8. The plaintiff also refers to the decision of Hill J in Oates v Commissioner of Taxation (1990) 27 FCR 289, which concerned a taxpayer who had been made bankrupt at the time at which he sought to claim tax deductions for the losses that he had incurred. The taxpayer was subsequently released from bankruptcy, at which time he was objecting by way of court proceedings to the decision not to permit his deduction claims. In that context, Hill J considered the meaning and temporal scope of the expression "becomes a bankrupt" and concluded that because the matter could be raised by the taxpayer on objection and, on objection, the Commissioner was aware of the true position, the fact that in the years in which the liability to tax arose the taxpayer was bankrupt did not mean that the provision precluded him from obtaining a deduction. The plaintiff draws from Oates the proposition that the facts necessary to the determination of liability to tax do not have to be established at the liability date, unless something in the statutory context clearly indicates that this is the case.

First issue: identification of the relevant body

1. As already noted, the defendant does not dispute that the legal person to whom the transfer of the Property was made is "the plaintiff as trustee for The General Work Trust" but raises the issue as to the identification of who, or what, it is against which the statutory criteria in s 275(3)(a) must be applied (i.e., whether the criteria in sub-paragraph (a) must be satisfied by the plaintiff directly or with reference to the institution which effects the purposes by which the plaintiff transferee, as trustee, is bound). The defendant contends that it is impermissible to consider the resources of the Social Work Trust in evaluating whether there is an exempt body and says that, when the resources of the Social Work Trust are excluded, the plaintiff is not an exempt charitable or benevolent body either directly (though s 275(3)(a)) or indirectly (through s 275(3)(c)).
2. The defendant contends that when the trustee is not a mere or bare trustee but is also effecting the purposes of the trust and carrying out various activities, such that it itself can be classified as an institution, one looks only to s 275(3)(a) (and not to sub-paragraph (c)). In the alternative, if one does look to s 275(3)(c), the defendant says that the "institution or other organisation" for which the plaintiff is trustee is "the [Salvation Army] AET to the extent that it effectuates the general work trust" (T 44.20).
3. In responding to the plaintiff's primary case, the defendant emphasises the nature of charitable trusts. It argues that the plaintiff cannot be the trustee for "The Salvation Army", as a beneficiary, because "The Salvation Army", as a legal entity, does not exist. (Pausing there, as already noted, the plaintiff expressly disavows any contention that it is acting as trustee for a person or legal entity, as opposed to acting as trustee for the purposes of the General Work Trust.)
4. In summary, the defendant draws, from authorities relating to charitable trusts and trusts in general, the following propositions.
5. First, that in order for there to be a charity there must be a trust (referring to Joyce v Ashfield Municipal Council (1959) 4 LGRA 195 at 205). Second, that charitable trusts are trusts for purposes, not trusts for persons (referring to Joyce v Ashfield Municipal Council at 205; Attorney-General for New South Wales v Perpetual Trustee Co (Ltd) (1940) 63 CLR 209 at 222 per Dixon and Evatt JJ; BSH Holdings Pty Ltd v Commissioner of State Revenue (2000) 2 VR 454; [2000] VSC 302 at [9] per Hansen J; Jacobs' Law of Trusts (8th ed, 2016) at [10-05]; and Stratton v Simpson). Third, that The Salvation Army, as a legal entity, does not exist and no trust exists whereby a person known as The Salvation Army is the beneficiary per se (a proposition not disputed by the plaintiff). Fourth, that a body or organisation which holds property upon a charitable trust and carries out the trust purposes is commonly called a charitable institution (referring to McGarvie Smith Institute v Campbelltown Municipal Council (1965) 83 WN (Pt 1) (NSW) 191). Fifth, that that "institution" is really but the instrument for carrying the relevant charitable purpose into effect (McGarvie; Stratton v Simpson).
6. The defendant argues that, when reference is made to a "charity" or "charitable institution", that "institution" is the body formed to carry out the relevant (charitable) purpose (citing Joyce v Ashfield Municipal Council at 198, 200-201) and refers to what was said in respect of institutions in McGarvie by Else-Mitchell J (at 192-193): It is clear that the rules relating to charities which have been worked out and are administered in Chancery relate solely to 'charitable trusts' or more accurately 'trusts for purposes which are charitable' and equally clear that these rules have nothing to do with institutions, corporate or otherwise, except so far as an institution may be controlled by trustees who hold its property subject to a trust for charitable purposes... noting that, there, the argument of counsel in Joyce v Ashfield Municipal Council was adopted as follows: To speak of institutions or entities as public charities is to introduce a concept which is not only confusing, but inaccurate. Unless an institution or entity, which is loosely called a charity, is bound as trustee to carry out a public charitable purpose, there is no public charity. If it is bound the public charity is not the institution itself, but the institution as an organisation subject to an established trust for charitable purposes.
7. The defendant argues that there is generally no distinction between the charitable purpose and charitable institution, citing Stratton v Simpson at 144, 145, 158 and 163; and quoting what was said in Stratton v Simpson at 144: But every charitable trust is a trust for a purpose or purposes that are charitable, not a trust for a person or persons, although persons benefit from the fulfilment of the purpose. A body or organization which holds property upon a charitable trust and carries out the trust purposes is commonly called a charitable institution or a charity. It is really but the instrument for carrying a purpose into effect. Confusion can occur from want of remembering this as Else-Mitchell J observed in McGarvie Smith Institute v Campbelltown Municipal Council.
8. As to the propositions drawn by the defendant from authorities relating to trusts more generally, the defendant notes that the duties, powers and rights of a trustee of a trust for charitable purposes and the administration of a trust for charitable purposes are effectively the same as those established by the courts of equity in connection with trusts for identified beneficiaries (referring to Commissioner of Taxation v Bargwanna (2012) 244 CLR 655; [2012] HCA 11; Commissioner of Taxation v Bruton Holdings Pty Ltd (in liq) (2008) 173 FCR 472; [2008] FCAFC 184); that one duty of a trustee of a charitable trust is to get in the trust property and keep it distinct from the property of the trustee and from property held on other trusts (Bargwanna at [10]; Bruton at [35]); that property held by a trustee for a trust is not property that can be used in the discharge of the personal debts of the trustee or discharge of the debts of a different trust (Re Byrne Australia Pty Ltd [1981] 1 NSWLR 394); and that, subject to the terms of the trust, property held by a trustee on trust is not to be mixed or merged with property held by that person in another capacity (such as property held on trust for another trust).
9. The defendant argues that it follows from this that property used by the relevant institution (the vehicle or instrument for effecting the purposes) must not be merged or mingled and that, where there are trusts for discrete purposes (even overlapping purposes), it is apposite to consider the vehicle for each discrete set of purposes as a separate institution.
10. Thus, it is submitted by the defendant that the plaintiff is the trustee of two separate and distinct purpose trusts, being the "General Work Trust" and the "Social Work Trust", and that the purposes (and resources) of each must be considered separately.
11. The defendant points to the fact that there are separate registrations with the Australian Charities and Not-for-profits Commission (ACNC) of: an institution, society or organisation being "The Trustee For The Salvation Army (NSW) General Work", nominating the charitable purpose it fulfils as being the "advancement of religion"; an "institution" being "The Salvation Army Australia Eastern Territory General Work" (the registration details in relation to which include that its "Other Name" is "The Salvation Army"; its "Entity Type" as "Charity"; and its "Sub-Entity Type" as "Advancing religion"); an institution, society or organisation being "The Trustee For The Salvation Army (NSW) Social Work", nominating the charitable purpose it fulfils as being "public benevolent institution"; and an "institution" being "The Salvation Army Australia Eastern Territory Social Work" (a registered charity, the registration details of which refer to itself as a "public benevolent institution").
12. The defendant also notes that The Salvation Army has described (in The Salvation Army AET Consolidated Financial Report 2014, at p 462 of the exhibit to the First Pethybridge affidavit) the AET as comprising "the following institutions" which it says are endorsed by the Australian Taxation Office for their respective charitable activities: The Salvation Army Australia Eastern Territory Social Work (an endorsed Public Benevolent Institution); and The Salvation Army Australia Eastern Territory General Work.
13. Reliance is placed by the defendant on the separation of the General Work of the AET and the Social Work of the AET in the form of separate financial reports; separate Finance Committees for AET Social Work and AET General Work; separate finance meetings in respect of the AET General Work and the AET Social Work; that the Trustees maintain separate fixed asset registers in respect of the property held, on the one part, for the purposes of the General Work Trust, and the other part, for the purposes of the Social Work Trust; that the Trustees enter contracts of employment with persons in one of two separate capacities, as employer (with persons who are employed for the purpose of effectuating the purposes of the General Work Trust as "The Salvation Army (NSW) Property Trust as trustee for The General Work"; and with persons employed for the purpose of effectuating the purposes of the Social Work Trust as "The Salvation Army (NSW) Property Trust as trustee for The Social Work").

Second issue: resources used wholly or predominantly for specified purpose

1. As to the second issue identified by the plaintiff (namely, whether the resources of the relevant institution or other organisation must be used wholly or predominantly for, relevantly in this case, the relief of poverty in Australia), the defendant refers to dictionary meanings of the words "wholly" and "predominantly", namely those in the Macquarie Dictionary ("wholly" to mean: "entirely; totally, altogether"; "predominant" to mean: "having ascendancy, power, authority or influence").
2. The defendant notes that "predominant" has been construed to convey "a prevailing or ruling characteristic" and "the main, most abundant, or strongest element; prevailing, preponderating" (referring to Law Institute of Victoria v Commissioner of State Revenue [2015] VSC 604; (2015) 101 ATR 899 and Lake Maroona Pty Ltd v Gladstone Regional [2017] QPEC 25; (2017) 224 LGERA 166 respectively); and that in Federal Commissioner of Taxation v Word Investments Limited (2008) 236 CLR 204; [2008] HCA 55 at [17] Gummow, Hayne, Heydon and Crennan JJ, in the context of purposes and objects of an institution, used the word "predominant" in distinction to "incidental" or "ancillary".
3. The defendant argues that the word "predominantly" in s 275(3)(a) is used in the sense that use for the specified purpose will be the "predominant" use or purpose, provided that any other use or purpose is not more than "incidental" or "ancillary" to the asserted "predominant" use or purpose. In support of this, the defendant submits that is relevant that Parliament expressly excluded from the statutory criteria both the advancement of religion and other purposes beneficial to the community (those being otherwise universally accepted charitable purposes). It is submitted that to construe "predominantly" as allowing for substantial, but nevertheless not dominant, purposes of advancement of religion and other purposes beneficial to the community, would undermine the legislative intention.
4. The defendant submits that the fundamental problem with the plaintiff's approach is that it is, in effect, attempting to bring into the statutory net the resources of the Social Work Trust when the trustee acquired the Property for the purposes of the General Work Trust; and in circumstances where the Social Work Trust and the General Work Trust are distinct trusts. The defendant says that, by asserting that - because it is trustee for all the purposes of The Salvation Army - recourse can be had to the entirety of the corpus of both the General Work Trust and the Social Work Trust, the plaintiff's submission is misconceived because it has the effect of merging the resources the trustee holds for the purposes of the General Work Trust with the separate resources it holds for the purposes of the Social Work Trust. (The defendant further says that the resources used by the instrument or vehicle described as the "AET" are bound by the terms of the individual trusts and are not merged resources.)
5. The defendant submits that, whilst the purposes of the General Work Trust include some purposes which are common purposes with those of the Social Work Trust, the purposes of the General Work Trust are more expansive than the purposes of the Social Work Trust. Therefore, the defendant argues that the undivided assets for each set of purposes must be kept separate (and it says that so much is reflected in the Deeds Poll and The Salvation Army Act). The defendant says that the plaintiff as trustee for the General Work Trust holds property on trust for the General Work Trust, separately and distinctly (referring to Bargwanna at [10]).
6. In other words, the defendant says that, as trustee for the General Work Trust and as trustee for the Social Work Trust, the plaintiff holds different assets on two different respective obligations and the relevant institutions are also so bound; and that those separate and distinct obligations fix separately and distinctly to the property held on each trust respectively. The defendant submits that The Salvation Army AET in various guises may have recourse to assets of one or other trust but that does not mean its resources encompass both for all purposes. In that sense, the defendant says that The Salvation Army AET is at least two distinct institutions.
7. The defendant contends that the plaintiff acquired the Property as trustee for the purposes of the General Work Trust using funds held on trust for the General Work Trust; in the terms of s 275(3)(c) of the Duties Act, it is the resources that may properly be applied for the purposes of the General Work Trust that may be taken into consideration, whether this is in respect of the AET, or the AET and AST or The Salvation Army; to the extent that the AET is the instrument or vehicle that effectuates the relevant purposes, the resources it applies or has recourse to for those purposes are the relevant resources: i.e., only those resources the AET has access to qua its role as the instrument of the General Work Trust are relevant. In that sense, it argues that the AET is two distinct instruments or institutions, one for the General Work Trust and one for the Social Work Trust. (This is said to be consistent with the AET's self-description). Thus it is submitted that the "resources" of the Social Work Trust, being purely for the purposes of the separate Social Work Trust, are not relevant to the statutory inquiry.
8. (In response the plaintiff submits that the relevant Salvation Army institution is the one for which it acts in its capacity as the trustee of the General Work Trust, namely The Salvation Army AET or the whole of The Salvation Army in Australia and that there is no support in the text of the legislation for taking such a narrow view of the activities of the relevant "institution". It says that where property is vested in trustees for use by the relevant "institution", the property can be said to be "appropriated and applied" for the purposes of that institution and hence used for those purposes. Further, the plaintiff says that the concept of "resources" is not limited to property capable of being held by a trustee, but can include people as well as include other matters not capable of being property held by a trustee, such as "know how", which it submits weighs strongly against the defendant's narrow construction.)

Third issue: "for the time being approved"

1. As to the third issue identified by the plaintiff on its primary case, namely whether the relevant institution or organisation is "for the time being approved" by the defendant, the defendant submits that the relevant "time being" at which there must be the requisite approval is the time that liability to duty arose. The defendant notes that liability for duty arises, and liability for duty in respect of a transfer of dutiable property is determinable, at the time set out in s 12 of the Duties Act and submits that this is the time at which the relevant "body corporate, society, institution or other organisation" must, as a matter of fact, have been approved for the purposes of s 275(3)(a) of the Duties Act.
2. In the present case, the defendant says the decision under review is a decision on an application made after the relevant time and it is submitted that the Court may not approve the plaintiff retrospectively (i.e., from a time pre-dating the application).
3. As to the plaintiff's submission (in its outline of submissions at [79]) seeking to rely on the defendant's ruling that approval may be granted retrospectively for up to a period of 3 months (DUT 034, at [15]), it is said by the defendant that rulings do not have the force of law and that there is no estoppel against the operation of the Duties Act (there referring to BBLT Pty Ltd v Chief Commissioner of the Office for State Revenue [2003] NSWSC 1003; (2003) 54 ATR 323; Federal Commissioner of Taxation v Wade (1951) 84 CLR 105).

Plaintiff's submissions

1. The plaintiff's secondary case, as noted earlier, relies upon a combination s 275(3)(b) and (c). The plaintiff identifies the following criteria to be satisfied for s 275(3)(b) to apply, namely that: the plaintiff is a body corporate or organisation that, in the opinion of the defendant, is of a charitable or benevolent nature; and the dutiable transaction is for such purposes as the defendant may approve in accordance with guidelines approved by the Treasurer.
2. The plaintiff argues that the issue here (since the defendant accepts that the plaintiff either satisfies the first criterion or is a trustee of such an organisation within s 275(3)(c) of the definition) is as to the proper interpretation and application of [3] of the Guidelines. The plaintiff says that its acquisition of the Property satisfies 3 of the Guidelines, being the acquisition of new headquarters, and argues that this is sufficient.
3. As to 3 of the Guidelines, the plaintiff says: first, that this does not apply because the relevant "property" acquired by the plaintiff (in this case, that which related to the leases granted by the prior proprietor) was a reversionary interest expectant on those leases and the plaintiff did not lease or sell that property (i.e., that reversionary interest); second, that 3 should be read down because it exceeds the power conferred by s 275A by reason that it purports to limit the exemption by reason of the "use" of the property acquired rather than the "purpose" for which the property was acquired (in circumstances where there is a clear distinction between those concepts, referring to the Interpretation Act, s 32); and, third, that in any event the exemption for property acquired for use as the headquarters (at 3 of the Guidelines) is a specific provision (which prevails over the more general 3), applying the maxim generalia specialibus non derogant.

Defendant's submissions

1. As to the plaintiff's secondary case, the defendant does not cavil with the proposition that the plaintiff (either directly or indirectly through The Salvation Army) is "of a charitable nature at general law" (defendant's outline of submissions at [47]). It says that the real dispute centres on whether the purpose of the dutiable transaction (which it argues by necessity requires a consideration of the proposed use of the Property) satisfies the statutory criteria.
2. The defendant argues that the requirement that the dutiable transaction or instrument "is for such purposes" as may relevantly be approved is a requirement that all such purposes of the relevant transaction or instrument must be purposes the defendant may approve in accordance with the Guidelines approved by the Treasurer (referring in that context to the role of s 275A of the Duties Act). The defendant argues that if "such purposes" does not mean "all purposes" then s 275A would be otiose (defendant's outline of submissions at [125]).
3. The defendant says that the requirement for all purposes of the relevant transaction to be purposes the Chief Commissioner may approve in accordance with the Guidelines is not met in respect of the Property because, in summary, the "transaction" was for "such purposes" which included: a purpose of the "advancement of religion" (being, amongst other matters, the housing of staff performing work exclusively for the religious work of the General Work Trust and the building and operation of a Chapel and a place of public worship); and a purpose of leasing a substantial part (approximately 35%) of the Property to Woolworths and Souths for an investment return.
4. Insofar as the plaintiff contends that the relevant "property" acquired by the plaintiff in respect of the leased space was merely the reversionary interest expectant on the leases and that it did not lease "that property" (i.e. the reversionary interest), the defendant says that the words "property to be used" in 3 of the Guidelines are concerned only with the immediate intended use of the physical land and buildings acquired pursuant to the transaction. The defendant says that the physical land and buildings comprising the leased space were acquired for the purpose of being let and the achievement of "an investment return", quoting from the Property Proposal Form (undated, but attached to an email of Peter Alward sent 11 April 2014, at p 358 of the exhibit to the First Pethybridge affidavit).
5. The defendant says that it would be problematic to interpret 3 of the Guidelines such that if a purchaser purchased the Property with an intention immediately to lease 35% of the Property to Woolworths and Souths (and subsequently did so) that person would be caught (by 3 of the Guidelines) in respect of the relevant transaction but a purchaser who purchased the Property knowing that that same 35% was subject to leases (which at the option of the tenants in one case could extend for some 50 years after the date of the transaction) would not be caught (by 3 of the Guidelines) (referring to Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297; defendant's outline of submissions, [131]). The defendant identifies that the words "property to be used" in 3 of the Guidelines are concerned with the intended use of the physical land and buildings acquired pursuant to the dutiable transaction.
6. In response, the plaintiff argues that it is consistent with the text of the Guidelines that a person who intends to occupy and use the premises, when they become vacant, for conducting relevant charitable activities, should be granted an exemption - and that a person who intends to grant a lease of that part of the premises to another entity does not enjoy the exemption (plaintiff's outline of submissions in reply, [20]).
7. With respect to the plaintiff's argument that the "property" the plaintiff acquired in respect of the leased space was only the reversionary interest expectant on the leases, such that the plaintiff did not offend the second sentence of 3 of the Guidelines, the defendant says that that submission, even if accepted, is not apt to resolve the plaintiff's non-compliance with 3] of the Guidelines. The defendant says that the reversionary interest was not (and could never be) "property to be used for the charitable or benevolent purposes of the organisation" (defendant's outline of submissions at [133]).
8. The plaintiff in response submits that that contention fails to recognise that "use" is a protean term that takes it meaning from its context. It says the term "use" encompasses many types of exploitation of the property. It notes that taxing statutes commonly employ the criterion of "use and occupation" and argues that the absence of the term "occupation" from the text suggests that "use" does not require occupation and that exploiting property by generating rental income that is predominantly dedicated to funding activities that promote the relevant charitable purposes is a relevant "use" of the property (plaintiff's outline of submissions in reply, [22]).
9. To the extent it is relevant, the defendant says that there is no satisfactory evidence that the plaintiff used the rent generated from the leased space "largely" for the "Social Work" (defendant's written submissions at [134], referring to [94] of the plaintiff's written submissions).
10. The defendant submits that reference to [3(b)] of the Guidelines does not assist the plaintiff for the following reasons. First, the reference to "property" in [3(b)] must include a reference to the reversionary interest and that reversionary interest was not "acquired for use as the headquarters" of the plaintiff. Second, the reference in [3(b)] to "the use of the property", by the definitive article(s), identifies that every use of "the property" must be part of continuing "charitable or benevolent work". The defendant says there is no "one" use of "the property" and not every use of "the property" complies with [3(b)] of the Guidelines. Third, it is said that there is no room between [3(a)] and [3(b)] of the Guidelines for the application of the principle of construction generalia specialibus non derogant. The defendant says that [3(a)] and [3(b)] are not cases where the maxim is applicable, dealing as they do with entirely separate matters.
11. Insofar as the plaintiff in its submissions (see [92.2] of the plaintiff's written submissions) argues that [3(a)] of the Guidelines is ultra vires by reason of the reference to "use" not "purpose" in that paragraph, the defendant submits that the only "guidelines" as such, as mandated by s 275(3)(b)(i) are those contained at [1] of the Guidelines document, that containing a list of "purposes" not inconsistent with the Duties Act.

Plaintiff's submissions

1. In its opening written submissions, the plaintiff argued that if neither of the primary or secondary cases be accepted, then the primary question between the parties in relation to the application of s 275A was whether the reference to "land" in the exempting provision should be read as a reference to the stratum (or floor space), or should be read as a reference to the interest acquired by the plaintiff (plaintiff's written submissions at [94]).
2. The plaintiff submitted that the interest it acquired in the Property was the reversionary interest expectant upon the leases granted by the previous proprietor to Woolworths and Souths. It accepts that the floor space leased to those tenants was not immediately used to conduct charitable operations but submits that the reversionary interest generated rent, and the rent was largely used to fund the "Social Work". In that sense, it submits that the land was used for charitable or benevolent purposes within the scope of the Guidelines. In the alternative, it submits that as it is intended that the floor space leased to the existing tenants will be utilised for the headquarters of AET when the leases are terminated, the portion of the land "used or to be used" for an exempt purpose is the whole of the land.
3. In oral submissions, the plaintiff did not challenge the 65% exemption (and hence the above arguments need not be addressed). Rather the plaintiff submitted that the defendant's contention that the assessment ought be increased was not expressly "pleaded" and should not now be allowed (referring to the defendant's amended appeal statement at [37]). In any event, it says that the evidence demonstrates that the multi-purpose rooms that are occasionally used for prayer services are predominantly used for exempt purposes.

Defendant's submissions

1. The defendant's position is that it accepts that 65% of the Property (minus an amount attributable to the "Chapel") is used or to be used partly for an exempt purpose. The defendant identifies the amount of 65% by reference to the leased space (which accounts for 35% of the floor space of the Property) which the defendant contends is not "used or to be used" for an exempt purpose, together with the Chapel space as an additional amount of space that is not to be used for an exempt purpose. Consequently, the defendant contends that "the portion of the land used or to be used for an exempt purpose" is (65% of Total Property - minus Chapel Space) (see [18A], [35], [36] of the defendant's amended appeal statement).
2. The defendant submits that the assessment and the decision of the defendant dated 15 August 2015 should be affirmed, subject to the partial exemption from duty under s 275A of the Duties Act (which is expressed to be 65% in the decision dated 15 August 2015) being reduced by the portion of the dutiable value that is referrable to the portion of the Property used or to be used for a purpose of advancement of religion, and a reassessment is to be issued by the defendant to give effect to that reduction in the partial exemption. The defendant says that the decision dated 30 August 2016 should be affirmed.
3. In oral submissions, the defendant submitted that the evidence of Mr Pethybridge as to the purposes for which the "Chapel" is now used was irrelevant. Rather, on the defendant's submission, all that matters is what the space was intended to be used for at the time of the acquisition. That is, the defendant maintains that one looks "at the taxable facts at the time of the dutiable transaction, and at that time it was to be a place of public worship" (T 56.23).

Determination

1. At the outset, I note that there was no dispute between the parties as to the principles applicable to the task of statutory construction.
2. In Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 at [47], Hayne, Heydon, Crennan and Kiefel JJ stated: This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy.
3. More recently, in Thiess v Collector of Customs (2014) 250 CLR 664; [2014] HCA 12 at [22], citing Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 at [39], the High Court made clear that, although statutory construction must begin with a consideration of the text, that statutory text must be considered in its context which includes legislative history and extrinsic materials. (See for example the approach adopted in Coverdale v West Coast Council (2016) 259 CLR 164; [2016] HCA 15 and the High Court's decision in SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; 91 ALJR 936 at [14] per Kiefel CJ, Nettle and Gordon JJ; [35]-[40] per Gageler J; and [82] and [92] per Edelman J.)
4. I have set out earlier the text of the relevant provisions. Insofar as the plaintiff's primary case is based on a combination of sub-paragraphs 275(3)(c) and (a), it is relevant to note the legislative history of those sub-paragraphs.
5. The predecessor provision to s 275 of the Duties Act was Item 24, Schedule 2, Part 2 to the Stamp Duties Act 1920 (NSW), which provided as follows: Any instrument by which property is conveyed or agreed to be conveyed to, or any loan security given by or on behalf of: (a) any society or institution for the time being approved by the Chief Commissioner for the purposes of this paragraph whose resources are, in accordance with its rules or objects, used wholly or predominantly for: (i) the relief of poverty in New South Wales, or (ii) the promotion of education in New South Wales, or (b) any society or institution which, in the opinion of the Chief Commissioner, is of a charitable or benevolent nature, or has as its primary object the promotion of the interests of Aborigines and where the instrument or loan security is for such purposes as the Chief Commissioner may approve in accordance with guidelines approved by the Treasurer.
6. Item 24 was inserted into the Second Schedule of the 1920 Act by the Stamp Duties (Further Amendment) Bill 1980 (NSW) (the Amending Bill). In the Second Reading speech for the Amending Bill, the Minister for Sport and Recreation, Minister for Tourism and Assistant Treasurer identified the main objectives of Bill, as follows: Under the present provisions of the Stamp Duties Act, gifts for the relief of poverty or the promotion of education in New South Wales are liable to the second schedule sale rates of duty instead of the higher sixth schedule rates which would normally apply to such gifts. Consequently, following the abolition of the sixth schedule there will, in effect, be no special concession for such gifts. Accordingly, it is proposed to provide a complete exemption from stamp duty in respect of the acquisition of property by any approved society or institution whose resources are, in accordance with its rules or objects, used wholly or predominantly for the relief of poverty or the promotion of education in New South Wales. The exemption will apply to gifts to and purchases and leases of property by the organization. Because an exemption in these terms would not cover all cases in which it would be considered appropriate to provide relief, provision has been made for the exemption to apply also to societies or institutions which, in the opinion of the Minister, are of a charitable or benevolent nature and where the instrument is for an approved purpose. The existing exemption for loan security duty is to be widened in this way also. The measures necessary to give effect to the proposed exemptions are set out in schedule 2 to the bill, and again, will apply from the date of abolition of death duty. In the meantime, the existing system of granting ex gratia relief in appropriate circumstances will continue.
7. Item 24 was re-enacted in similar form in s 275 of the Duties Act.
8. In Sargents case, Gzell J held at [25] that a trustee which lacked an "establishment, organisation or association created to bring to fruition the purpose conceived by the founders of the foundation" was not a "society or institution" for the purposes of s 275(3)(a) in its then form.
9. Sub-paragraph 275(3)(c) of the Duties Act was then introduced into the Act (by cl 43 of Schedule 1 of the State Revenue Legislation Amendment Act 2008 (NSW) (the State Revenue Legislation Amendment Act)) and sub-paragraph 275(3)(a) was expanded such that the words "society or institution" became "body corporate, society, institution or other organisation" (by cl 41 of Schedule 1 of the State Revenue Legislation Amendment Act). The Explanatory Note to the State Revenue Legislation Amendment Act identified the introduction of s 275(3)(c) of the Duties Act as an amendment to "extend … the duty exemption that applies to charities to persons acting in their capacity as a trustee for a charity".
10. Pausing here, the defendant notes that the concept of an "exempt charitable or benevolent body" for the purposes of s 275 of the Duties Act is narrower in scope than the common law definition of "charitable" (pointing out that the exhaustive definition of "exempt charitable or benevolent body" does not extend to all purposes within the common law meaning of "charitable"). The defendant argues that, in enacting s 275(3)(a) of the Duties Act, the Parliament deliberately excluded from the definition of "exempt charitable or benevolent body" trusts for the "advancement of religion" and trusts for "other purposes beneficial to the community"; and notes that, in enacting s 275(3)(b), the Parliament defined the exempt body by reference to the purpose of the dutiable transaction, thereby narrowing the definition.
11. The defendant argues that since there can be no "charity" without a trustee, initially, as there was no equivalent to s 275(3)(c) of the Duties Act in Item 24, Schedule 2, Part 2 to the Stamp Duties Act 1920, only trustees who effected the purpose of the trust and could thereby be said to be an institution (or society) could claim the exemption; whereas the current provision expressly caters to trustees who do no more than hold property (i.e., bare trustees).

First issue: identification of relevant body

1. As has been made clear above, the plaintiff and defendant differ as to the applicability of s 275(3)(c). The defendant submits that where, as here, a trustee is not a mere or bare trustee, one should look only to s 275(3)(a).
2. While the introduction of sub-paragraph (3)(c) was part of the legislative amendment to address the perceived difficulty arising out of the decision in Sargents case (where a trustee lacking "an establishment, organisation or association created to bring to fruition the purpose conceived by the founders of the foundation" had been held not to be a society or institution for the purposes of the then sub-paragraph (3)(a)), there is nothing in the text of the amended legislation to indicate that what was intended was that sub-paragraph (3)(c) should apply only to the case of a person holding property as a bare trustee. The explanatory note to which I have referred to above focusses not on there being a "bare trustee" but on the extension of the exemption to persons acting in the capacity "as a trustee for a charity". Nor do I see any basis in the text for the proposition that a person in the position of the plaintiff must fall within sub-paragraph (3)(a) alone in order to be entitled to the exemption.
3. Accepting that it is relevant to look to s 275(3)(c), there is no dispute (as has already been noted) with the proposition that in entering into the relevant contracts the plaintiff is a "person" and acting in its capacity as a trustee.
4. The question is then "for" which entity (or "for" the purposes of which entity) the plaintiff is acting in its capacity as trustee.
5. In oral submissions, the following propositions were put for the plaintiff: that "the plaintiff, with its two hats on, is the body which has been called into existence to translate that purpose [that of the founders] into reality" (T 30); that "the two trusts are charitable trusts. They're trusts for purposes. But the purpose is the purpose of the Salvation Army" (T 36); and that "[t]he plaintiff is there to be the agent of the [Salvation] Army and its work, and does so by acting as trustee to hold legal property and enter into legal relationships…, including [with] staff" (T 70). Reference was made to Warringah Shire Council, where his Honour said that the plaintiff was established by The Salvation Army Act "for the various purposes of the [Salvation Army]" and to further "the aims and objects of the [Salvation] Army".
6. The enquiry required by sub-paragraph 275(3)(c) is as to whether the relevant person (here the plaintiff to whom the Property was transferred) is acting in the capacity of trustee for, relevantly, the benefit or purposes of an institution or organisation. As noted earlier, the plaintiff submits that the relevant "institution or other organisation" for the purposes of sub-paragraph 275(3)(c) is "The Salvation Army AET" (or The Salvation Army in Australia); the defendant submits that the relevant "institution" is the General Work Trust (or the Salvation Army AET to the extent that it effectuates the purposes of the General Work Trust).
7. It is well known that a trust is not a juristic person with a legal personality distinct from that of the trustee; and it has been said that a trust is an "institution developed by equity and cognisable by a court of equity" (see JD Heydon and MJ Leeming, Jacobs' Law of Trusts (8th ed, 2016, LexisNexis Butterworths) at [1-01]). However, to regard the "General Work Trust" as an "institution" in the conceptual sense there referred to as falling within sub-paragraph (3)(c) (which is in effect the construction for which the defendant contends, as I understand it) would be to treat the word "institution" in that sub-paragraph as giving a separate persona to the collection of rights and obligations imposed on the trustee of a purpose trust (i.e., here by the Deed of Constitution as amended). I do not accept that the word "institution" in the phrase "body corporate, society, institution or other organisation" is used in the conceptual sense referred to above and the "General Work Trust" is not an "institution" in any other sense. Reference to the "General Work Trust", in my opinion, is really a short-hand reference to the fact that the plaintiff has obligations as trustee not for the benefit of an identified beneficiary but in order to effectuate the (general work) charitable purposes set out in the Deed of Constitution as amended.
8. Here, in furthering the purposes of what has been described (by way of short-hand) as the General Work Trust (and, for that matter, what has similarly been described in short-hand fashion as the Social Work Trust), the plaintiff in its capacity as trustee is in reality acting "for" the benefit or the purposes of The Salvation Army, as made clear in the recitals to the Deed of Constitution (and the 1920 Social Work Deed). And, having regard to the structure of The Salvation Army movement in Australia, the plaintiff can be seen to be acting "for" the benefit and purposes of the subset of that movement or "institution" that is known as The Salvation Army AET. It does not follow from the fact that two separate purpose trusts have been established - referred to as the General Work Trust and the Social Work Trust - that those are two separate "institutions", nor that the relevant institution for the purposes of sub-paragraph 275(3)(c) is limited to the institution which in that capacity effectuates the purposes of the General Work Trust alone, particularly in circumstances where both purpose trusts are for the benefit and purposes of The Salvation Army (in Australia) and, as The Salvation Army movement is administratively organised within Australia, the purposes of the territorial organisation known as The Salvation Army AET. The fact that the plaintiff has described (or in my view misdescribed) its administrative organisations as "institutions" in not-for-profit registration documents (see [85] above) or in financial reports (see [86] above) is not to determinative of the issue. It does not amount to an admission against interest and this is not a case where an estoppel of some kind has been said to arise from such a (mis)description.
9. In Glebe Administration Board v Commissioner of Pay-roll Tax (1987) 10 NSWLR 352, the question was whether, for the purposes of an exemption from pay-roll tax, the Glebe Administration Board was a "religious institution". Priestley JA, with whom McHugh JA, as his Honour then was, agreed, concluded that the Board was not at any relevant time a religious institution, saying (at 365): It was a statutory corporation doing commercial work within limitations fixed by reference to religious principles. It was staffed by person who wished to observe the religious principles giving rise to the limitations on the Board's commercial activities. The property in its ownership both increased in value and gave rise to revenue. Capital was held for the benefit of a religious institution [the Church of England Diocese of Sydney in which property was vested] and large amounts of revenue were handed over to that institution. To my mind all these matters result in it being accurate to describe the Board as a legal entity working in a commercial area, guiding its commercial conduct by the principles of a religious institution and, in ordinary language, working for that religious institution. I do not think that this legal entity can either by an ordinary or a technical use of language be accurately called a religious institution.
10. For the defendant in these proceedings it was argued that the conclusion that the Board was not a religious institution rested on the proposition that the Board in holding church property was endowed with non-religious managerial powers so that it could not be said that the property was appropriated to entirely religious purposes; rather it was to a substantial extent appropriated to commercial purposes, the net profit from which was to be available for religious purposes. His Honour considered that the Board's argument did not sufficiently take that matter into account. Nevertheless, what I take from his Honour's reasoning as extracted above is the notion that the Board in that case was, in ordinary language, working "for" the institution.
11. Lee AJA, in dissent, suggested that an unincorporated association which his Honour said "may be referred to as an "institution" or a "society" or an "association" could as a matter of ordinary English use or occupy a property or conduct a school (see at 383) and saw no reason "why an institution cannot comprise the general members of the unincorporated association, the trustees of the property being held for the purposes of the association and bodies corporate formed to participate in and to carry out the purposes of the institution" (see at 382).
12. In the present case, the plaintiff was incorporated by statute in order to hold property on the trusts that had earlier been established for the purposes of the objects of The Salvation Army. The conclusion of Street J in Warringah Shire Council was that property was vested in the trustees "but the whole of their powers were designed to be exercised for the single purpose of furthering the aims and objects of the Army" (at 99). The Salvation Army movement in Australia, and in particular the organisation structured for administrative reasons as The Salvation Army AET, can be understood to be an "institution" within the ordinary meaning encompassed by that word, just as a school (and not just the building itself in which the school operates) can be understood to be an "institution".
13. In Commissioner of Land Tax (NSW) v Joyce at Menzies J (at 28) said: The land both at Ashfield and at Burwood is owned by the respondents as trustee but it seems so obvious as to require no discussion that the respondents themselves are not a charitable institution. They are individuals holding as trustees for charitable purposes. The land is not owned by a charitable institution. Here, the legislation does not use the phrase trustee "of … an institution". It speaks of a person acting in its capacity as trustee "for" an institution. This must mean acting for the benefit or purposes of the institution.
14. In McGarvie, Else-Mitchell J said (at 192-193): It is clear that the rules relating to charities which have been worked out and are administered in Chancery relate solely to "charitable trusts" or more accurately "trusts for purposes which are charitable" and equally clear that these rules have nothing to do with institutions, corporate or otherwise, except so far as an institution may be controlled by trustees who hold its property subject to a trust for charitable purposes. (emphasis added)
15. For those reasons, I have concluded that the plaintiff is acting as a trustee for (the purposes or benefit of) an institution or other organisation, that institution or organisation being The Salvation Army AET as a separate administrative entity or subset of The Salvation Army in Australia as a whole. The fact that the Deeds Poll establishing the separate purpose trusts (i.e., the General Work Trust and the Social Work Trust) have established distinct charitable purpose trusts does not mean that the plaintiff is not, when effectuating the charitable purposes one or both of those purpose trusts, acting as trustee for an institution or organisation within sub-paragraph (3)(c). The purposes for which each of the two purpose trusts was established are for the benefit of the institution known as The Salvation Army (that being the unincorporated association of members of that religious and charitable movement).

Second issue: resources used wholly or predominantly for specified purpose

1. The next question is as to whether The Salvation Army AET (or The Salvation Army within Australia as a whole) is an institution or organisation referred to in sub-paragraph (3)(a).
2. This turns first on whether its resources are, in accordance with its rules and objects, used wholly or predominantly for the relief of poverty in Australia. There is no doubt that the geographical aspect of this condition is satisfied. Further, it cannot be doubted that the objects of The Salvation Army (both AET and combined with AST) include the provision of services for the social and moral welfare of the poor - the relief of poverty. In my opinion where approximately 75% of the financial and personnel resources of both the AET and the AET/AST combined are expended on social work programs with the object of relieving poverty, this requirement is satisfied.
3. The defendant placed reliance on dictionary definitions of "wholly" and "predominantly", arguing that a use or purpose is "predominant" if no other use or purpose is more than "incidental" or "ancillary" (defendant's written submissions [105]). One needs to bear in mind the caution sounded in various authorities as to the use to be made of dictionary definitions. So, for example, Leeming JA observed in 2 Elizabeth Bay Road Pty Ltd v The Owners - Strata Plan No 73943 (2014) 88 NSWLR 488; [2014] NSWCA 409 at [81] that "dictionary definitions specify a range of meanings, rather than the particular meaning of a word in its context". More recently, in TAL Life Ltd v Shuetrim (2016) 94 NSWLR 439; [2016] NSWCA 68, Leeming JA (with whom Beazley P agreed and Emmett AJA concurred), said at [80]: If I may respectfully say so, what clearly emerges from White J's collection of judgments in which the word "unlikely" has been explained in comparable and less comparable contexts is merely that it has been held to denote different meanings in different contexts. That conclusion means merely that "unlikely" is no different from most English words. It also illustrates the inutility of dictionary definitions in construing a legal text (in this case, a clause in an insurance policy). Dictionary definitions may assist in identifying the range of possible meanings a word may bear in various contexts, but will not assist in ascertaining the precise meaning the word bears in a particular context. As much was recognised by a unanimous High Court (and earlier by Learned Hand J) in Thiess v Collector of Customs [2014] HCA 12; 250 CLR 664 at [23] when observing that a mature and developed jurisprudence does not "make a fortress out of the dictionary"; see also 2 Elizabeth Bay Road Pty Ltd v The Owners - Strata Plan No 73943 [2014] NSWCA 409; 88 NSWLR 488 at [81]. Although the distinction between the dictionary definition of a word and its legal meaning is not often well understood, it is clear that dictionaries are no substitute for the interpretative process, as was observed by R McDougall, "Construction of contracts: The High Court's approach" (2016) 41 Aust Bar Rev 103 at 115; see also Comcare v Martinez (No 2) [2013] FCA 439; 212 FCR 272 at [68] (Robertson J).
4. The phrase used in the section in the present case, "wholly or predominantly", clearly contemplates that the resources of the organisation need not be entirely used for one of the two specified purposes. The ordinary meaning of "predominantly" in my opinion connotes that the specified purpose will be the most dominant of the purposes of the institution or organisation. That is consistent with the meaning attributed to the adjective in the Law Institute of Victoria case and the Lake Maroona case (see [89] above) and not inconsistent with the Word Investments case insofar as an incidental or ancillary purpose could not be a predominant one.
5. That requirement is satisfied in the present case where three quarters of the resources are devoted to the relief of poverty by the various social work programs conducted by The Salvation Army AET. The fact that the Property is held by the plaintiff in its capacity as trustee of the General Work Trust does not preclude a conclusion that the resources of the AET are predominantly used for the relief of poverty; nor does such a conclusion herald a breach of the duties of a trustee to which the defendant referred in its submissions.
6. Pausing here, I have some difficulty with the proposition that the concept of "resources" in the context of sub-paragraph 275(3)(a) encompasses not simply financial resources but the personnel of the institution or organisation as well. Intellectual property is one thing; organisational "know-how" may be another. But it is not necessary to explore this issue further since, whether or not personnel are included as part of the "resources" of the institution or organisation for these purposes, predominance of use is in my opinion here satisfied.

Third issue: "for the time being approved"

1. As to the requirement that the institution or organisation be one that is "for the time being approved" by the defendant for the purposes of sub-paragraph (3)(a), on balance I consider that the construction for which the plaintiff contends is correct. "For the time being" connotes, in ordinary speech, a point in time or period of time that is not fixed but is open-ended; by way of example, if one were to say that, for the time being, a matter will remain in the Commercial List, that leaves open the possibility that this will not necessarily always be the case. In other words, the phrase "for the time being" is an ambulatory concept which takes its meaning from the context in which it appears, and is not apt to specify a particular time at which something will be the case once and for all.
2. That, of course, begs the question as to what is the relevant time. If what was intended by the legislature was that the institution or organisation must have been approved as at the time at which liability for duty arises, and liability for duty in respect of a transfer of dutiable property is determinable, it would have been a simple matter for the legislature to have specified that as the relevant time. Instead, the legislature adopted the expression "for the time being". To my mind that connotes a focus on the time at which the question of an exemption from duty arises (which question may arise across a spectrum of times - from the time of acquisition of the property through to the time of consideration of an objection to the disallowance of an application for exemption to the time of an appeal therefrom). I draw support for that conclusion from the fact that the expression is "for the time being approved" not "which has been approved" (the latter would more clearly indicate that the status of having been approved is one that must have existed prior to any exemption arising).
3. The Court, upon review of the Commissioner's decision, has the power to make afresh an assessment or other decision in place of the assessment or other decision to which the application relates (Administration Act s 101(1)(b)). Although, strictly speaking, the decisions to which this application relates are the exemption decisions (as opposed to a decision as to whether or not to approve the plaintiff for the purposes of s 275(3)(a)), the decision not to approve the plaintiff for the purposes of the paragraph is necessarily a component of the Commissioner's decisions to refuse the exemption and disallow the objections. This is illustrated by the defendant's letter dated 10 October 2016 (annexure E to the affidavit of Cameron Steele sworn 27 October 2016) which states: My view is that the Taxpayer cannot be approved as an exempt charitable or benevolent body under section 275(3)(a) for the reasons outlined below. … [T]he Chief Commissioner cannot approve the Trust as an exempt charitable or benevolent body under section 275(3)(a) of the Duties Act.
4. The plaintiff seeks review of the decision in that letter, disallowing the plaintiff's objection, and it follows that making a decision as to whether or not "approve" the plaintiff "for the time being" falls within the Court's powers upon a review pursuant to s 97(1) of the Administration Act. I draw further support for this conclusion from the reasoning of White J in the Milstern Nominees case, at [4]: The review under s 97 of the Taxation Administration Act is a de novo review and is not limited to the materials before the Chief Commissioner. The parties are not bound by the grounds of objection to the Chief Commissioner's decision, nor by the reasons for decision on the objection. Nominees is not required to show that the Chief Commissioner had erred on the materials before him, or that the exercise of the Chief Commissioner's discretion, or refusal to exercise the discretion under s 163H, was vitiated by a mistake of law, or by failure to have regard to a consideration to which regard was required to be had, or by having regard to extraneous considerations.
5. For those reasons I have concluded that the plaintiff is acting in its capacity as trustee for an institution (The Salvation Army AET) which should be accepted as "approved" for the purposes of sub-paragraph 3(a), the resources of which are predominantly used for the relief of poverty; and therefore has made out its claim to an entitlement for an exemption under s 275(1) by virtue of it being an exempt charitable or benevolent body within the meaning of s 275(3)(c) read with s 275(3)(a)).

Plaintiff's secondary case

1. In light of the above conclusion it is not strictly necessary to determine the plaintiff's secondary case but, lest I be wrong in the above conclusion, I will set out briefly my conclusions on that issue.
2. The dispute in this regard was not as to whether the plaintiff (a body corporate), as trustee for the purposes of the General Work Trust, is of a charitable or benevolent nature but as to whether the dutiable transaction "is for such purposes" as the defendant may approve in accordance with the guidelines approved by the Treasurer.
3. Paragraphs [1] and [3] of those Guidelines, which I have set out at [37]-[38] above, are here relevant. There is a threshold question about the relationship between paragraphs [1] and [3]. For example, if a property is acquired for use as the headquarters of an organisation- a situation expressly addressed by paragraph [3(b)]- must the transaction also have charitable or benevolent purposes, as outlined in paragraph [1]? Or, alternatively, does paragraph [3(b)] create a separate approved "purpose", which stands alone?
4. In my view, the correct way to interpret the Guidelines is to give paragraph [1] predominance, such that it sets out a complete list of the purposes which the defendant may approve under sub-paragraph 275(3)(a)(i). I consider that paragraph [3] of the Guidelines is intended further to elucidate paragraph [1] (by giving examples about how it is intended to operate, which would assist the delegates of the defendant), rather than creating new separate categories of approved purposes. I consider this to be the more natural interpretation of the Guidelines.
5. I then turn to the defendant's submission on the interpretation of sub-paragraph 275(3)(b)(i). The approved charitable and benevolent purposes set out in [1] of the Guidelines clearly do not include the purpose of advancement of religion. Therefore, if sub-paragraph 275(3)(b)(i) requires that all "such purposes" of the transaction must be purposes that may be approved in accordance with the Guidelines, acquisition of the Property for purposes which included (as the preliminary planning report indicated) a religious purpose would preclude the exemption arising.
6. There is force in the submission that "for such purposes" means "all" or "entirely for such purposes". I accept that this is the natural or ordinary meaning of the sub-paragraph. It is also consistent with its purpose. A different interpretation would have odd results: it would render sub-paragraph 275(3)(b)(i) significantly wider than sub-paragraph 275(3)(a). Any organisation "of a charitable or benevolent nature" (a wide class) could utilise the exemption in respect of a transaction that is partly (or even, say, substantially) for an approved purpose, whereas it would not have qualified for an exemption under sub-paragraph 3(a). In addition - and although sub-paragraph 275A(6) expressly provides that s 275A does not limit s 275 - such a construction would not be the preferable one if it would leave no practical operation for s 275A of the Duties Act, on the basis that such a construction is unlikely to reflect the legislative intent.
7. That is sufficient to dispose of the plaintiff's secondary case.
8. Debate also focussed on the role of paragraph [3] of the Guidelines in this context. In particular, the submission for the plaintiff was, in effect, that it was sufficient for the transaction to be for the purpose specified in guideline 3(b) (for the use as the headquarters of an approved organisation if the use of the property is part of continuing charitable or benevolent work), whether or not part of it was used for religious purposes and whether or not the transaction would comply with the requirements of guideline 3(a) (i.e., that the property cannot be let or sold for profit).
9. In that regard, I do not accept the submission for the plaintiff (assuming I have understood it correctly) that in respect of that part of the Property which is leased to Woolworths/Souths what has been acquired by the plaintiff is the reversionary interest in the freehold (such that Guideline 3(a) is not rendered inapplicable). True it is that, on acquisition of the Property, the plaintiff took its freehold interest subject to the said leases and has no more than a reversionary interest in the leased premises but, as the defendant points out, what has been let to Woolworths/Souths is not the reversionary interest in the leased premises and in any event it seems to me that the requirement that the property is used or to be used for the charitable or benevolent purposes of the organisation and "cannot be let … for profit" (Guideline 3(b)) requires consideration of use both present and future and is not satisfied by the prospect that at some time in the future (which, in the case of the Woolworths lease may be as far away as 2070) it will not be let for profit. Nor do I accept that if the rent from the leased premises is used for the purpose of social work programs (and the evidence does not support the conclusion that it is wholly for this purpose since it is being used to repay the internal loan from the general fund) then it is being used for charitable or benevolent purposes and complies with Guideline 3(a).
10. On a reading of paragraph [3] of the Guidelines as a whole the sub-paragraphs do not appear to impose cumulative requirements (since, for example, Guideline [3(d)] is limited to property acquired by religious organisations whereas the others are not so limited). There is an available argument that the specificity of Guideline [3(b)] indicates that a transaction may fall within that guideline even if one or other of the other sub-paragraphs of [3] of the Guidelines does not apply to the transaction. But in any event this does not address the difficulty that one of the purposes of the transaction (a religious purpose) does not fall within paragraph [1] of the Guidelines.
11. Therefore, had it been necessary to determine I would have held that the transaction was not exempt from duty pursuant to s 275(3)(b) and the plaintiff's secondary case would have failed (and hence I do not propose to grant the relief sought in relation to the decision by the defendant on the exemption application which was put on that basis).

Plaintiff's tertiary case

1. Again this does not strictly arise in light of the conclusion on the primary case but I will briefly address it. I should not that although complaint was made by the plaintiff as to the time at which this issue was raised no prejudice was identified as arising in that regard.
2. Had it been necessary to decide, I would have concluded that the defendant's contention that one looks only at intended use (that is, the intended use at the time of the acquisition) cannot be supported, having regard to the plain words of the statute. Section 275A refers to how the land concerned "is used" as well as how it is "to be used", and one cannot simply ignore the reference to current land usage. As I discussed earlier, the Court has power to make the taxation assessment afresh, and that necessarily implies a power to make that assessment on the evidence currently before the Court.
3. The evidence establishes that use of the so-called Prayer/meeting room (or Chapel) is predominantly for exempt purposes (the room mainly being used for seminars and meetings related to the charitable and benevolent work comprised by the social work programs of The Salvation Army AET). The saying of a prayer as part of a staff meeting does not mean that the land is not used for an exempt purpose. The evidence is that the Friday gathering time is devoted mainly to the social welfare of the poor and needy (facilitating social contact and the provision of a free meal). Half an hour at the end of the Friday gathering for a religious service appears to me to be de minimis (and incidental or ancillary to the predominantly charitable purpose for which the gathering is held). If any further deduction (from the 65% in the assessment initially proposed under s 275A) were to be made it would not in my view be appropriate for it to be measured by reference to the floor space of the Prayer/meeting room; there is a persuasive argument that at most it should be based on a proportionate adjustment of the use made of the room for religious purposes (which on the evidence appears to be very limited) as opposed for seminars and meetings related to the charitable purposes of the General Work Trust. However, it is not necessary to decide this.

Orders

1. For the above reasons, I make the following orders: 1. Revoke the assessment dated 15 August 2015 of the defendant. 2. Revoke the decision dated 30 August 2016 of the defendant. 3. Set aside the determination dated 10 October 2016 of the defendant whereby the defendant disallowed the plaintiff's objection dated 6 October 2016. 4. Allow the plaintiff's objections in full. 5. Order the defendant to pay the plaintiff's costs.

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