Case: Tooheys Limited v Commissioner of Stamp Duties (NSW) [1961] HCA 35 ; (1961) 105 CLR 602
Outcome: applied
In Tooheys Limited v Commissioner of Stamp Duties (NSW) [1961] HCA 35 ; (1961) 105 CLR 602, the High Court was concerned to interpret provisions of the Stamp Duties Act 1920-1956 (NSW) which provided for the levying of duty on instruments, subject to exemptions, inter alia "relating to the services of apprentices, clerks and servants". The majority of the High Court held that the instrument under consideration was not an instrument "relating to the services of apprentices, clerks and servants" so as to be exempt from duty. Dixon CJ said at 614: "When the exemption clause speaks of an instrument relating to the services of apprentices, clerks, and servants, I understand it as meaning primarily an instrument dealing with the relationship of master and apprentice, master and clerk or master and servant. It may affect one term or all the terms of the relationship. It may govern or regulate the relationship or it may affect it less directly perhaps and still relate to it. But it is that with which it must deal." Taylor J said at 620-621: "There can be no doubt that the expression 'relating to' is extremely wide but it is also vague and indefinite. Clearly enough it predicates the existence of some kind of relationship but it leaves unspecified the plane upon which the relationship is to be sought and identified. That being so all that a court can do is to endeavour to seek some precision in the context in which the expression is used. With this in mind it may be said with some certainty that an examination of the language of the exempting provision shows that it does not admit of its application to an instrument merely because it makes a reference to the existence of a relationship of master and servant between the parties to it, or still less, because it refers to the existence of a master and servant relationship between persons who are not parties to it. It is, I think, not open to argument that 'relating to', in the context in which it appears, is equivalent to 'referring to' and the 'relationship' must be based upon some more substantial ground. It is, in my opinion, equally clear that the relationship must appear upon an examination of the instrument itself for it is the character of the instrument which is the material question and this cannot be resolved by an examination of extraneous matters in order to determine the purpose of the parties. In other words the condition for the operation of the exempting provision is that the instrument must 'relate' and not merely that a relationship of some kind can be made to appear by a consideration of the motive or purpose which has brought it into existence." Taylor J considered a line of authority which was said to provide support for a contrary proposition to that in the last sentence quoted. Taylor J concluded that the line of authority did not support a contrary proposition but rather was authority for the proposition that (at 622): "the vital question is whether the instrument 'relates' and not whether it may be 'related' by an examination of extraneous circumstances". 69 In Australian Competition and Consumer Commission v Maritime Union of Australia [2001] FCA 1549 ; (2001) 114 FCR 472, Hill J was concerned to interpret s 6(2)(b)(ii) of the Trade Practices Act 1974 (Cth) which confined the operation of s 60 of that Act to conduct which took place in the course of or in relation to trade or commerce between Australia and places outside Australia. Hill J said at 487-488: "It may be accepted that there will always be a question of degree involved where the issue is the relationship between two subject matters. The words 'in relation to' are wide words which do no more, at least without reference to context, than signify the need for there to be some relationship or connection between two subject matters: see Smith v Commissioner of Taxation (Cth) [1987] HCA 48 ; (1987) 164 CLR 513 at 533 per Toohey J and PMT Partners Pty Ltd (In liq) v Australian National Parks and Wildlife Service [1995] HCA 36 ; (1995) 184 CLR 301 at 328 per Toohey and Gummow JJ. But the phrase is both 'vague and indefinite': see per Taylor J in Tooheys Ltd v Commissioner of Stamp Duties (NSW) [1961] HCA 35 ; (1961) 105 CLR 602 at 620. Like the phrase 'in respect of', the phrase 'in relation to' will not, at least normally, apply to any connection or relationship no matter how remote: see Technical Products Pty Ltd v State Government Insurance Office (Qld) [1989] HCA 24 ; (1989) 167 CLR 45 at 51 per Dawson J. The extent of the relationship required will depend upon the context in which the words are used. As Beaumont and Lehane JJ said in Joye v Beach Petroleum NL (1996) 67 FCR 275 at 285 in discussing a number of the cases dealing with 'relates to': ' ... it will depend upon context whether it is necessary that the relationship be direct or substantial, or whether an indirect or less than substantial connection will suffice.' (References omitted.)" 70 In Joye v Beach Petroleum NL (1996) 67 FCR 275, the Full Court of the Federal Court said at 285: "The relevant question here, whether the 'matter' is one 'relating to' a winding up, is concerned with the existence of a relationship. It does not raise a question of characterisation. Of the phrase 'relating to', Taylor J said, in Tooheys Ltd v Commissioner of Stamp Duties [1961] HCA 35 ; (1961) 105 CLR 602 at 620: ' ... the expression ... is extremely wide but it is also vague and indefinite. Clearly enough it predicates the existence of some kind of relationship but it leaves unspecified the plane upon which the relationship is to be sought and identified. That being so, all that a court can do is to endeavour to seek some precision in the context in which the expression is used'" Taylor J went on to say (at 620) that 'relating to' in the context there considered was not the 'equivalent of 'referring to'; the 'relationship' must be based upon some more substantial ground'. Other decisions of the High Court have acknowledged that, ordinarily, 'relates to' is a wide term, and that it will depend upon context whether it is necessary that the relationship be direct or substantial, or whether an indirect or less than substantial connection will suffice (see Re Dingjan; Ex parte Wagner [1995] HCA 16 ; (1995) 183 CLR 323 at 338 per Brennan J, at 347 per Dawson J, at 354 per Toohey J and at 370 per McHugh J; PMT Partners Pty Ltd (In liq) v Australian National Parks &amp; Wildlife Service [1995] HCA 36 ; (1995) 69 ALJR 829 at 835-836 per Brennan CJ, Gaudron and McHugh JJ and at 845-846 per Toohey and Gummow JJ; Re Jarman; Ex parte Cook [1996] HCA 7 ; (1996) 70 ALJR 550 at 553 per Brennan CJ and Gaudron J and at 556 per Kirby J. Tooheys' case has been followed in this Court (see, eg, Secretary, Department of Foreign Affairs and Trade v Boswell (1992) 36 FCR 367 at 374 per Hill J and at 383 per Cooper J). In our view, there is nothing in the present context to suggest that the term 'relating to', where used in s 580 and when picked up by s 581(4) , was not intended to have a wide operation or that an indirect, but relevant, connection would not be a sufficient relationship for present purposes." 73 The context in which s 1041H appears suggests that subs (1) is to have a wide operation. So much can be gleaned from subsec (2) and the varied types of conduct specified which do not limit the scope of s 1041H(1). Nevertheless there must be some ostensible connection or relationship on the face of the conduct, that is, a connection or relationship on the face of the letters with shares in CIL. To adopt and adapt the words of Dixon CJ in Tooheys Limited v Commissioner of Stamp Duties (NSW) (supra), the letters do not deal with shares in CIL. I also adopt and adapt the words of Taylor J in the same case: the relationship between the contents of the letters relied upon by the Commission and shares in CIL does not appear upon an examination of the letters themselves. As Taylor J said, and I accept, it is the character of the letters which is the material consideration. The contents of the letters on which the Commission relies do not relate to shares in CIL. 74 The consequence is that the Commission's allegations in relation to the 27 September letter and the 29 September letter and their contents do not demonstrate a contravention of s 1041H. The letters and the statements in them relied on by the Commission are not notices, statements or representations "in relation to" shares and securities in CIL, that is to say, in relation to financial products or financial services. Rather they are notices, statements or representations "in relation to" CIL itself or to a product manufactured, distributed and sold by CIL. The allegations might otherwise raise for consideration whether other provisions of the Act , such as s 1041E , might have been contravened, but the Commission has only alleged a contravention of s 1041H.