3. How should the costs of this case be borne and paid? F.C. THE QUEENSLAND MEAT EXPORT Co. LTD. v. THE COMMISSIONERS OF STAMPS. THE AUSTRALIAN In the case of The Commissioners of Stamps v. The Australian Stock Breeders' Company Ltd. the special case stated set forth facts very similar to those stated in the above case. The property which was agreed to be transferred by the old company and its liquidator, and to be taken over by the new company, comprised freehold and leasehold lands, live stock, stores, and a cash payment. By the agreement (Clause 15), the value of the stock agreed BREEDERS' Co. to be sold was determined at £185,393, and by Ciause 12 it was provided that the liquidator of the old company should, at the request in writing of the new company, place to their credit at a specified bank the sum of £6000. Feez K.C. and Real (for Hart, on service with His Majesty's Forces), for the company in both cases. The instrument is chargeable with duty only as a deed or agreement under seal. The instrument does not transfer or vest the new company any of the personal property or the choses in action stated in par. 5. It makes no assignment, legal or equitable, of that property. It is not a conveyance on sale at all, but merely an agreement under seal. The property passed to the new company by the transaction, not by the instrument, which is only evidence of the transaction. The instrument does not vest or transfer any of that property. The instrument is only executory. They referred to The Stamp Act, 1894, ss. 49, 50, 51, 52, 59; Croydon Consols Limited v. Commissioners of Stamps (1), Hamwood v. Commissioners of Stamps (2), Re Taylor's Transfer (3), Great Fitzroy Mines Ltd. v. Commissioners of Stamps (4), Dixon v. Yates (5), per Parke J.; The Sale of Goods Act, ss. 4, 20, 21; Horsfall v. Hey (6). [LUKIN J. referred to Ridout v. Fowler (7).] Chesterfield Brewery Co. v. Commissioners of Inland Revenue (8), Benjamin on Sales, 5th Ed., p. 55. Compare the English Stamp Act of 1891 (54 and 55 Vic., c. 39), s. 54, and s. 49 of The Stamp Act, 1894; Alpe on Stamp Duties, 13th Ed., pp. 128 and 133; Halsbury, Laws of England, Vol. XXV., b. 175; The Companies STOCK LTD. v. THE COMMISSIONERS OF STAMPS. F.C. THE QUEENSLAND MEAT EXPORT Act of 1861, s. 28. If stamp duty is payable as on a conveyance or transfer, it is payable on the market value of the fully-paid shares, and not on their face value. Commissioner for Stamp Duties v. Broken Hill South Extended Ltd. (1), The Crown v. COMMISSIONERS Bullfinch Proprietary Ltd. (2), Commissioners of Inland Revenue v. Angus (3). An action for specific performance would have been necessary to enforce this agreement. Co. LTD. v. OF STAMPS. THE AUSTRALIAN STOCK BREEDERS' Co LTD. v. THE COMMISSIONERS OF STAMPS. Cooper C.J. Stumm K.C. and Gore Jones, for the respondents: The instrument is chargeable with ad valorem duty as a conveyance on sale. The Stamp Act, 1894, s. 49. By it the new company acquires the property of the old company. Compare the English Acts, The Stamp Act of 1870 (33 and 34 Vic., c. 97), s. 70, and The Stamp Act of 1897 (54 and 55 Vic., c. 39), s. 54, with The Stamp Act, 1894, s. 49. The words, "legally or equitably,” which appear in the Act of 1870, were omitted from the Act of 1891 and from our s. 49. The agreement transfers the equitable and the legal interest in these properties. John Foster & Sons Ltd. v. Commissioners of Inland Revenue (4), Re Taylor's Transfer (5), The Sale of Goods Act of 1896, ss. 20, 21, 4, subsec. 3 ; Tarling v. Baxter (6), Encyclopædia of English Law, 2nd Ed., Vol. I., p. 551; Measures Bros. Ltd. v. Commissioners of Inland Revenue (7), Rugg v. Minett (8), West London Syndicate v. Inland Revenue Commissioners (9), Hutton v. Lippert (10), Highmore on The Stamp Act, pp. 8 and 161; Halsbury, Laws of England, Vol. XXV., p. 121; Gillett v. Hill (11), Whitehouse v. Frost (12), Busk v. Davis (13). Feez K.C., in reply: The instrument does not, so far as the chattels and choses in action are concerned, relate to anything specific referred to Alpe on Stamp Duties, 13th Ed., p. 133 ; Benjamin on Sales, 5th Ed., p. 317. The judgment of the Court was read by C.A.V. COOPER C.J. In this case it was, we think, admitted that the instrument which, according to the contention of the respondents (the Commissioners of Stamps), is chargeable with ad valorem duty (1) [1911] A.C. 439. (2) 1912, 15 C.L.R. 443. (6) 1827, 6 B. & C. 360. (7) 1900, 82 L.T. 689. (8) 1809, 11 East. 209; 48 W.R. 303. (9) [1898] 2 Q.B. 507. as a conveyance on sale, and according to the contention of the appellants (The Queensland Meat Export Company Limited), is chargeable only with duty as a deed or agreement under seal, is in terms, at all events, a mere agreement under seal. But for the respondents it was argued that, so far as the instrument relates to certain chattels and choses in action, it is in substance and effect a conveyance on sale within the meaning of s. 49 of The Stamp Act, 1894. A copy of the instrument in question is annexed to and forms part of the special case. It need not therefore be recapitulated in extenso. It is, we think, sufficient to point out that the instrument does not relate to the purchase and sale of these chattels and choses in action alone, but that it deals also with the purchase and sale of other properties, notably freehold and leasehold lands, valued at £450,000, with regard to which it admittedly does not operate as a conveyance. In fact, the instrument embodies the whole of the scheme pursuant to which the appellants, a new company established for this purpose, are to acquire certain undertakings of an old company in course of voluntary liquidation, together with the assets of the old company in connection with these undertakings, and, as the consideration for the acquisition of these properties, are to take upon themselves the debts, liabilities, and obligations of the old company in connection with the undertakings acquired, and to allot to the liquidator of the old company, or to nominees of the old company, fully paid-up shares in the new company for distribution amongst the members of the old company. In our opinion, this really disposes of the case, for to quote the words of Lindley L.J., in Commissioners of Inland Revenue v. Angus (1), "any conveyancer any lawyer-would see in a moment that such an instrument was not a conveyance at all,' but was an agreement which is a totally different thing.' 6 If the instrument related only to specific chattels and choses in action, the arguments addressed to us by Mr. Stumm and Mr. Gore Jones would, we think, be unanswerable, and certainly would not, we think, be met by some of the arguments with which Mr. Feez sought to meet them. In all cases it is the substance and effect, not the form of the instrument, to which regard must be had; so that if a transaction which, in fact, amounts to a (1) 1889, 23 Q.B.D. 579, at p. 595, F.C. THE COMMISSIONERS STOCK OF STAMPS. Cooper C..J. F.C. THE QUEENSLAND MEAT EXPORT Co. LTD. v. THE COMMISSIONERS OF STAMPS. THE BREEDERS' Co. Cooper C.J. conveyance on sale, is reduced into writing, the instrument does not escape classification as a conveyance on sale simply because it is couched in language, which, in form, refers to the past or the future. But the argument addressed to us by counsel for the respondents was, we think, based upon a false assumption, similar to that made by counsel for the Commissioners of Inland Revenue in Angus' Case (1). As is pointed out by Lord Esher M.R. in that case, "It"-i.e., the instrument in question-" has been skillfully treated in argument--as an agreement with regard to the goodwill only. But it is not so." So in this case, as it seems to us, the instrument has been treated in argument as an agreement with regard to certain chattels and choses in action only, but is not so. In Ha'sbury's Laws of England (Vol. 25, p. 175, Clause 312), the law is thus stated-" A non-severable contract for the sale of specific goods and of an interest in land is, with regard to the goods, prima facie an agreement to sell only, and the transfer of the property in the goods is prima facie conditional on the conveyance of the interest in the land, even although separate prices may have been fixed for the goods and for the interest in the land." We think that this statement of the law is fully justified by the cases cited in support of it. (See also Benjamin on Sales, 5th Ed., p. 317.) Is there anything, then, in the instrument with which we are now concerned which renders the prima facie rule of interpretation established by this statement of the law inapplicable to it? In our opinion, it would be truer to say that the instrument itself can only be construed as making the transfer of the chattels and choses in action to which it relates conditional upon the conveyance of freeholds and leaseholds, the due issue by the respondents to the liquidator or nominees of the old company of a specified number of paid-up shares of their capital, and a general working out of the whole scheme of reconstruction, pursuant to which certain undertakings and assets of a company in course of voluntary liquidation are eventually to be transferred to the new company formed to take them over. Could it be contended that if, owing to some prior but forgotten or disputed agreement to sell the old company's meatworks to (1) 1889, 23 Q.B.D. 579. some purchaser other than the respondents, the scheme embodied in this instrument fell through, became incapable of performance, and was renounced by the appellants, the chattels and choses in action referred to in the instrument would remain vested in the appellants, and that something would have to be done to revest them in the old company? In our opinion, this question could only be answered in the negative. And in our opinion this is only another way of saying that the instrument is an executory instrument- -a mere agreement, and no conveyance of any of the property or of any estate or interest in any of the property to which it relates. It appears to us impossible to support the contentions of the respondents unless, to quote once more the words of Lindley L.J. in Angus' Case (1)—" we are prepared to destroy the distinction between an agreement and a conveyance, a distinction which is perfectly well known to every lawyer." It follows that, in our opinion, the instrument ought to be stamped as a deed or agreement under seal, and not as a conveyance on sale, and that Questions 1 (a) and 1 (b) should be answered accordingly. In the view which we take of the first question, the only other question calling for an answer is the third. As to this, we think that the appellants' cost of the special case, limited to £20, should be paid by the respondents, and that the excess of duty paid by the company under the assessment, and the sum of £20 paid by the appellants as security for costs, together with any accretions thereto which may have resulted from its investment, should be paid to the appellants. Appeal allowed, with costs. The second case was decided according to the view expressed in the above judgment. F.C. THE QUEENSLAND MEAT EXPORT Co. LTD. v. THE COMMISSIONERS OF STAMPS. THE AUSTRALIAN STOCK BREEDERS' Co LTD. v. THE COMMISSIONERS OF STAMPS. Cooper C.J. Appeal allowed, with costs. Solicitors for appellants: Flower & Hart. Solicitor for the Commissioners of Stamps: The Crown Solicitor. (1) 1889, 23 Q.B.D. 579, at p. 597. |