Case: Baxter Healthcare Pty Limited v Comptroller-General of Customs (1997) 72 FCR 467
Outcome: cited
Subsequently, the issue was discussed at some length by Burchett J in Baxter Healthcare Pty Limited v Comptroller-General of Customs (1997) 72 FCR 467 (" Baxter Healthcare ") in a most helpful judgment. His Honour said at 471-472: "A preliminary point should be mentioned, since it is important, although little attention was paid to it in argument. Where there is a question whether something falls within a verbal description in a statute (as in a case raising the application of a tariff item), the answer may depend simply on findings of fact as to the meaning of the words constituting the description and as to the nature of the thing itself. With regard to the words, '[t]he question what is the meaning of an ordinary English word or phrase as used in [a] Statute is one of fact not of law': Australian Gas Light Co v Valuer-General (1940) 40 SR (NSW) 126 at 137 per Jordan CJ. Nevertheless, once the nature of the thing has been found as a fact, whether it falls within the verbal description will, in many cases, be a question of law. For, in the first place, it may not be a matter of applying merely the ordinary English meaning of words or phrases, but of applying a meaning derived from the statute by a process of construction, which is a process of law: Hope v Bathurst City Council [1980] HCA 16 ; (1980) 144 CLR 1 at 10 per Mason J, with whose reasons Gibbs, Stephen and Aickin JJ stated their agreement. The principle that construction is a process of law has never been doubted, although the completeness of the proposition derived from it that '[t]he effect or construction of a term once its meaning or interpretation is established is a matter of law': Agfa-Gevaert Ltd v Collector of Customs (1994) 124 ALR 645 at 648 per Gummow J; Collector of Customs v Pozzolanic Enterprises Pty Ltd (at 287), and the relationship between that proposition and the proposition that the meaning of an ordinary word or phrase is a matter of fact, were left in some doubt when Agfa-Gevaert v Collector of Customs was reversed on appeal by the High Court: see Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36 ; (1996) 186 CLR 389 at 395-397. Gummow J, in Agfa-Gevaert Ltd v Collector of Customs , also held (ibid) that it is a question of law 'whether the facts as found fall within the terms of the law as properly construed; to this there is the qualification that, where the statute uses words according to their ordinary meaning and it is reasonably open to hold that the facts as found fall within those words, the decision as to whether they do so fall generally is a matter of fact'. His Honour added that the limitation 'generally' was required, even in this last case, 'because the law may use a word in an ordinary sense, but there may be a number of ordinary senses and it then is necessary to select that which is appropriate, and because whilst the word may have but one ordinary meaning that is imprecise, the word will take its colour from the context and that will require construction of the law, a lawyer's task. The result in such cases will be more than the matching of a set of facts with plain words'. The proposition that 'whether facts fully found fall within the provisions of a statutory enactment properly construed is a question of law' was stated to be sustained by '[m]any authorities' in the judgment of Mason J in Hope v Bathurst City Council (at 7). The same proposition was subsequently applied by Full Courts of this Court to cases where what was in issue was whether facts as found fell within the provision of a tariff item: Peacock v Zyfert (1983) 48 ALR 549; Rheem Australia Ltd v Collector of Customs (NSW) (1988) 78 ALR 285 at 293, 306." 28 Burchett J recognised that complexities can arise in the application of these principles, and for that reason he said that at least two qualifications should be added. 30 The second qualification arises where there is uncertainty as to the meaning of a statutory word or expression, and that uncertainty can be resolved by construing the word according to its context. That process raises a question of law. Burchett J explained why this is so in the following passage at 473-474: "In such a case, a court or tribunal does not choose between different possible applications of the one equivocal or inexact statutory concept (for example, 'insulting') to an evaluation or an appreciation (in the French sense see 69 ALJ 984) of the facts, but chooses upon the principles of construction between possible concepts conveyed by the statutory expression. Of course, it is conceivable that a particular provision in an enactment will raise both kinds of problem. But Gummow J's remarks in Agfa-Gevaert Ltd v Collector of Customs seem to me to involve that, where the susceptibility of words and expressions to different meanings or shades of meaning is to be resolved by a process of construction of the statutory language in order to determine whether it embraces the facts found, the ultimate question is one of law. This accords with the view of Fullagar J in Hayes v Commissioner of Taxation (Cth) , with Hope at 10, and with the joint judgment of Sheppard and Burchett JJ in Australian National Railways Commission v Collector of Customs (SA) (1985) 8 FCR 264 at 277. In Collector of Customs v Agfa-Gevaert Ltd at 397, the joint judgment of the High Court refers to the principle 'that the determination of whether an "Act uses [an] expression ... in any other sense than that which they have [scilicet, it has] in ordinary speech" is always a question of law'. On that basis, logically it must also be a question of law, in a case where a statutory expression has several ordinary senses, whether it is used in a particular one of them. And as the joint judgment of Neaves, French and Cooper JJ in Pozzolanic Enterprises points out (at 288-289), uncertainties may require to be resolved by reference to a value judgment about the range of the Act, rather than a matching of the facts to the, or an, ordinary meaning of the words. Their Honours said: 'Although the words of the statute are construed according to their ordinary English meaning, that does not mean that their application to a set of facts is simply described as the matching of that set of facts with a factual description. There is necessarily a selection process involved. The range of relationships to which the words apply for the purpose of the Act depends upon a judgment about that purpose. The selection process involved is analogous to that used in determining what causal relationships between conduct and loss attract liability for the purpose of s 82 of the Trade Practices Act (1974) (Cth): see Elna Australia Pty Ltd v International Computers (Aust) Pty Ltd (No 2) (1987) 16 FCR 410 at 418-419; Munchies Management Pty Ltd v Belperio (1988) 58 FCR 274 at 286-288; 84 ALR 700 at 712-713. In the end this is not a process of fact finding. The facts are found. What is left is a value judgment about the range of the Act and that is a question of law.' This passage was referred to in the joint judgment of the High Court, without criticism, in Collector of Customs v Agfa-Gevaert Ltd at 395." 39 At the very least, the examples in heading 3808 and the references to camphor and mosquito spirals and coils in sub-heading 3808.10.10 suggest that there is some ambiguity about the way in which the term insecticide is used in the heading. To adapt the language used by Burchett J in Baxter Healthcare , a legal choice must be made about possible concepts conveyed by the statutory expression, and in making that choice it is appropriate to take account of the intent and purpose of the Customs Tariff Act . In my opinion, it would have been permissible for the Tribunal to have regard to the Harmonised System Notes as an extrinsic aid to the interpretation of heading 3808. Where the language of a heading is ambiguous or susceptible to different interpretations, the Harmonised System Notes are an appropriate extrinsic aid to interpretation: Gardner Smith v Collector of Customs Victoria (1986) 66 ALR 377 at 383-384; Barry R Liggins Pty Ltd v Comptroller-General of Customs (1991) 103 ALR 565 at 571-573; and Toyota Tsusho Australia Pty Ltd v Collector of Customs [1992] FCA 282 at [22] - [30] .