FEDERAL COURT OF AUSTRALIA GE Capital Finance Australasia Pty Limited v Commissioner of Taxation [2011] FCA 849 Citation: GE Capital Finance Australasia Pty Limited v Commissioner of Taxation [2011] FCA 849 Parties: GE CAPITAL FINANCE AUSTRALASIA PTY LIMITED and GE CAPITAL AUSTRALIA v COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA File numbers: VID 1042 of 2010 VID 309 of 2011 Judge: GORDON J Date of judgment: 28 July 2011 Catchwords: TAXATION – Income Tax Assessment Act 1997 (Cth) – Div 719B – Multiple Entry Consolidated group – s 719-5(4)(c) – choice in writing – rectification Legislation: Federal Court of Australia Act 1976 (Cth) Federal Court Rules Income Tax Assessment Act 1936 (Cth) Income Tax Assessment Act 1997 (Cth) Judiciary Act 1903 (Cth) Taxation Administration Act 1953 (Cth) Tax Laws Amendment (2010 Measures No 1) Act 2010 (Cth) Tax Laws Amendment (2010 Measures No. 1) Bill 2010 (Cth) Explanatory Memorandum Cases cited: Allnutt v Wilding [2006] EWHC 1905 (Ch) Allnutt v Wilding [2007] EWCA Civ 412 Australia & New Zealand Banking Group Ltd v Widin (1990) 26 FCR 21 BHP Petroleum (Timor Sea) Pty Ltd v Minister for Resources (1994) 49 FCR 155 Butlin's Settlement Trusts; In re [1976] Ch 251 Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 Codelfa Constructions Pty Ltd v State Rail Authority of NSW (1981-1982) 149 CLR 337 Commissioner of Stamp Duties (NSW) v Carlenka Pty Ltd (1995) 41 NSWLR 329 Fitzgerald v Masters (1956) 95 CLR 420 Gibbon v Mitchell [1990] 3 All ER 338 Harvey v Edwards, Dunlop & Co Ltd (1927) 39 CLR 302 Holding & Barns plc v Hill House Hammond Ltd [2002] L. & T. R. 7 Kent v Brown (1942) 43 SR (NSW) 124 Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2005) 223 ALR 560 Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181 MW McIntosh Pty Limited v Commissioner of Taxation (2009) 178 FCR 100 P v Board of Australian Crime Commission & Ors (2006) 151 FCR 114 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Pukallus v Cameron (1982) 180 CLR 447 Racal Group Services v Ashmore [1995] STC 1151 Spencer v The Commonwealth (2010) 241 CLR 118 Spunwill Pty Ltd v BAB Pty Ltd (1994) 36 NSWLR 290 Telstra Corporation Ltd v Ivory [2008] QSC 123 The Application of GE Mortgage Insurance Pty Ltd [2004] FCA 154 Wills v Gibbs [2007] EWHC 3361 (Ch) Date of hearing: 21 and 22 June 2011 Date of last submissions: 24 June 2011 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 124 Counsel for the Applicants: A Archibald QC, S Steward SC and DJ McInerney Solicitor for the Applicants: Greenwood & Freehills Pty Limited Counsel for the Respondent: M Moshinsky SC and D Harding Solicitor for the Respondent: Australian Government Solicitor IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1042 of 2010 BETWEEN: GE CAPITAL FINANCE AUSTRALASIA PTY LIMITED First Applicant GE CAPITAL AUSTRALIA Second Applicant AND: COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent JUDGE: GORDON J DATE OF ORDER: 28 JULY 2011 WHERE MADE: MELBOURNE THE COURT DECLARES THAT: 1. The GE Capital Finance Australasia Pty Limited Multiple Entity Consolidated group (the GECFAsia MEC Group) consolidated for the purposes of Div 719 of the Income Tax Assessment Act 1997 (Cth) with effect from 1 July 2003. 2. GE Capital Australia and the 29 listed companies in Annexure A became subsidiary members of the GECFAsia MEC Group with effect from 1 July 2003. 3. GE Mortgage Insurance Holdings Pty Ltd (now called Genworth Financial Mortgage Insurance Holdings Pty Limited) and GE Mortgage Insurance Company Pty Ltd (now called Genworth Financial Mortgage Insurance Ltd) became members of the GECFAsia MEC Group with effect from 10 November 2003. AND THE COURT ORDERS THAT: 4. The respondent pay the applicants' costs, such costs to be taxed in default of agreement. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. ANNEXURE A 1. AGC Staff Superannuation Fund Pty Ltd 2. AOC Holdings Pty Ltd 3. Avco Access Pty Ltd 4. Avco Australia Pty Ltd 5. Avco Superannuation Plan Pty Ltd 6. Capital Australis Pty Ltd 7. Frenzeal Pty Ltd 8. GE (Finance) Pty Ltd 9. GE (General Finance) Pty Ltd 10. GE (Leasing) Pty Ltd 11. GE Australia Employee Share Plan Pty Ltd 12. GE Automotive Financial Services 13. GE Capital Asset Services & Trading Asia Pacific Pty Ltd 14. GE Capital Finance Australia 15. GE Capital Mortgage Insurance Company (Australia) Pty Ltd 16. GE Capital Security Agent Pty Ltd 17. GE Commercial Corp (Australia) Pty Ltd 18. GE Commercial Deposits Australia Pty Ltd 19. GE Finance Australasia Pty Ltd 20. GE Mortgage Insurance Pty Ltd 21. GE Personal Finance Pty Ltd 22. GEA Superannuation Plan Pty Ltd 23. GEMICO Holdings 24. Hallmark General Insurance Company Ltd 25. Hallmark Life Insurance Company Ltd 26. NFC Superannuation Fund Pty Ltd 27. Rohenryn Pty Ltd 28. Traders Finance Corp Pty Ltd 29. Zinadene Pty Ltd IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 309 of 2011 BETWEEN: GE CAPITAL FINANCE AUSTRALASIA PTY LIMITED Applicant AND: COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent JUDGE: GORDON J DATE OF ORDER: 28 jULY 2011 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. The Preliminary Question: Whether GE Mortgage Insurance Holdings Pty Ltd (now called Genworth Financial Mortgage Insurance Holdings Pty Limited) and GE Mortgage Insurance Company Pty Ltd (now called Genworth Financial Mortgage Insurance Ltd) became members of GE Capital Finance Australasia Pty Limited's Multiple Entity Consolidated group with effect from 10 November 2003 pursuant to s 719-5(4) of the Income Tax Assessment Act 1997 (Cth) as amended by the Tax Laws Amendment (2010 Measures No 1) Act 2010 (Cth), be answered: Yes. 2. The respondent pay the applicant's costs, such costs to be taxed in default of agreement. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1042 of 2010 BETWEEN: GE CAPITAL FINANCE AUSTRALASIA PTY LIMITED First Applicant GE CAPITAL AUSTRALIA Second Applicant AND: COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 309 of 2011 BETWEEN: GE CAPITAL FINANCE AUSTRALASIA PTY LIMITED Applicant AND: COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent JUDGE: GORDON J DATE: 28 JULY 2011 PLACE: MELBOURNE REASONS FOR JUDGMENT A. INTRODUCTION 1 This case concerns a Multiple Entry Consolidated (MEC) group under Div 719 of the Income Tax Assessment Act 1997 (Cth) (the 1997 Act) and the proper construction of ss 719-5, 719-50, 719-76 and 719-77 of the 1997 Act after the Tax Laws Amendment (2010 Measures No 1) Act 2010 (Cth) (the 2010 Amending Act). All references to the 1997 Act are to the 1997 Act after the enactment of the 2010 Amending Act (unless otherwise noted by the inclusion of the phrase "old law" after the relevant section(s)). 2 On or about 18 August 2004, the applicants sent the respondent a NAT 7024 form (the 7024 Form) concerning: 1. their choice to form a 'MEC group' (the GECFAsia MEC Group) for the purposes of Div 719 of the 1997 Act (old law); and 2. the first applicant's (GE Capital Finance Australasia Pty Limited) (GECFAsia) choice, for the purposes of s 719-5(4)(c) of the 1997 Act (old law), that GE Mortgage Insurance Holdings Pty Limited (now called Genworth Financial Mortgage Insurance Holdings Pty Ltd) (GEMIH) was to become a member of that group. 3 By letter dated 27 August 2004, the respondent informed GECFAsia that he had recorded the formation of the GECFAsia MEC Group as at 1 July 2003 and that GEMIH and its wholly owned subsidiary, GE Mortgage Insurance Company Pty Limited (now called Genworth Financial Mortgage Insurance Pty Limited) (GEMICO), was a member of that group. 4 The respondent now contends that the choice required by s 719-5(4)(c) of the 1997 Act was not made by GECFAsia and, accordingly, GEMIH and GEMICO never joined the GECFAsia MEC Group because: 1. no "choice" was made for GEMIH to join the GECFAsia MEC Group; or 2. if a choice was made for GEMIH to join the GECFAsia MEC Group, that "choice" did not comply with s 719-5(4)(c) because it was not in writing. 5 The applicants reject those contentions. They contend that the issues arise only because the 7024 Form omitted to include the date upon which each of GEMIH and GEMICO joined the GECFAsia MEC Group – 10 November 2003, the date of their incorporation. The applicants accept that the date was not on the 7024 Form but contend that omission was a mistake – an administrative error. Moreover, they reject the contention that the choice for GEMIH to join the GECFAsia MEC Group, required by s 719-5(4)(c) of the 1997 Act, was not made by GECFAsia. 6 There are two proceedings. In VID 1042 of 2010 (the 39B Proceeding), the applicants seek declaratory relief pursuant to s 39B of the Judiciary Act 1903 (Cth) and s 21 of the Federal Court of Australia Act 1976 (Cth) that: 1. the GECFAsia MEC Group consolidated for the purposes of Div 719 of the 1997 Act with effect from 1 July 2003; 2. GE Capital Australia (GECA) and 29 listed companies became subsidiary members of the GECFAsia MEC Group with effect from 1 July 2003; and 3. GEMIH and GEMICO became members of the GECFAsia MEC Group with effect from 10 November 2003. 7 Alternatively, the applicants seek an order that the 7024 Form be rectified by the insertion in Part 3 of the form of the date "10 November 2003" in the square boxes that follow the words "if joined after date of consolidation, give date joined the group" in each of the sections dealing with GEMIH and GEMICO. 8 The second proceeding – VID 309 of 2011 – was issued under Pt IVC of the Taxation Administration Act 1953 (Cth) (the TAA) by GECFAsia (the Pt IVC Proceeding). At the commencement of the hearing, the applicants and the respondent agreed in the Pt IVC Proceeding, pursuant to O 29 r 2 of the Federal Court Rules, that the following question be separately tried and decided: Whether GE Mortgage Insurance Holdings Pty Ltd (now called Genworth Financial Mortgage Insurance Holdings Pty Limited) and GE Mortgage Insurance Company Pty Ltd (now called Genworth Financial Mortgage Insurance Ltd) became members of GECFAsia's MEC group with effect from 10 November 2003 pursuant to s 719-5(4) of the 1997 Act as amended by the [2010 Amending Act]. (the Preliminary Question.) 9 Orders also were made that the Preliminary Question be tried and decided together with, and at the same time as, the 39B Proceeding and before the same judge and that evidence filed in the 39B Proceeding was evidence filed in the Pt IVC Proceeding and vice versa. 10 These reasons for decision consider the relevant legislative scheme and then address the facts. What then follows is an analysis of the following questions: 1. Was a choice made for GEMIH to join the GECFAsia MEC Group? 2. If yes to 1, was that choice in writing for the purposes of s 719-5(4)(c) of the 1997 Act? 3. If no to 1, should the 7024 Form be rectified? 11 For the reasons that follow, the answer to the preliminary question in the Pt IVC proceedings is yes and, in the 39B Proceeding, the Court should make the declarations in [6] above. B. LEGISLATIVE SCHEME 12 Section 719-5(4)(c) of the 1997 Act is part of the consolidations regime in Pt 3-90 of the 1997 Act. The starting point in considering the consolidation regime in Pt 3-90 of the 1997 Act is s 700-1 which provides: This Part allows certain groups of entities to be treated as single entities for income tax purposes. Following a choice to consolidate, subsidiary members are treated as part of the head company of the group rather than as separate income tax identities. The head company inherits their income tax history when they become subsidiary members of the group. On ceasing to be subsidiary members, they take with them an income tax history that recognises that they are different from when they became subsidiary members. … (Emphasis added.) 13 Section 700-5 of the 1997 Act provides an overview of the regime and provides, so far as is relevant: (1) The single entity rule determines how the income tax liability of a consolidated group will be ascertained. The basic principle is contained in the Core Rules in Division 701. (2) Essentially, a consolidated group consists of an Australian resident head company and all of its Australian resident wholly-owned subsidiaries (which may be companies, trusts or partnerships). ... (3) An eligible wholly-owned group becomes a consolidated group after notice of a choice to consolidate is given to the Commissioner. … (Emphasis added.) 14 The Core Rules are in Div 701 of Pt 3-90 of the 1997 Act: ss 701-1 to 701-90. The most important is the "single entity rule": s 701-1. In general terms, subsidiary members of the group are treated as parts of the head company, rather than as separate entities. They are treated as one single taxpayer. This has important implications. Any transactions between members of the group will be ignored for tax purposes. 15 The decision to consolidate is optional: s 700-5(3). However, if a group decides to consolidate, all of its wholly owned Australian resident companies must consolidate: s 700-5(2). A "consolidated group" will ordinarily consist of a "head company" and all its wholly owned "subsidiary members": see also ss 703-5(2), 703-15 and 703-20. A "head company" is an Australian resident company: ss 703-10 and 703-15. 16 Division 719 of the 1997 Act permits, subject to specific requirements, Australian resident companies directly or indirectly wholly owned by a foreign parent, and at least partly owned by a non-resident (defined as "eligible tier-1" companies) also to form a consolidated group under Pt 3-90 of the 1997 Act. A consolidated group formed pursuant to Div 719 is referred to as a MEC (multiple entry consolidated) group: see Div 719B. Eligible tier-1 companies are the only companies entitled to elect to form a MEC group: s 719-5. A MEC group will automatically include the Australian resident wholly owned subsidiaries of the eligible tier-1 companies: s 719-10. Subject to some modifications presently not relevant, a MEC group is treated as a consolidated group under Pt 3-90: s 719-2(1). 17 The choice to form a MEC group can be made with effect from any day (after 30 June 2002) on which the potential MEC group came into existence: s 719-50(1). The choice to form a MEC group must be notified to the respondent by written notice and in the "approved form" (within the meaning of s 388-50 in Sch 1 to the TAA) jointly specifying the day and making the choice that the group be consolidated on and after that day: s 719-50(1). Failure to notify the respondent is an offence and gives rise to penalty: s 8C of the TAA. The choice can have retrospective effect so long as it is made no later than the date specified in s 719-50(3) – the lodgement date of the income tax return for the head company for the income year during which the MEC group is formed. 18 Under the old law, if a new company became an eligible tier-1 company of a top company of an existing MEC group (for example, by incorporation), then the way that company joined an existing MEC group of that top company was prescribed by s 719-5(4) as follows: If: (a) a MEC group consists of the members of a potential MEC group derived from one or more eligible tier-1 companies of a top company; and (b) at a particular time after the MEC group came into existence, one or more other companies become eligible tier-1 companies of the top company; and (c) within the applicable period worked out under subsection (6), the *provisional head company of the MEC group gives the Commissioner a written notice, in the *approved form: (i) specifying one or more of the companies mentioned in paragraph (b); and (ii) stating that the specified companies are to become members of the MEC group with effect from that time; … then, with effect from that time, the MEC group mentioned in paragraph (a) is taken to consist of the potential MEC group derived from time to time from whichever one or more of the following companies continue to be eligible tier-1 companies of the top company: (e) the companies mentioned in paragraph (a); (f) the companies specified in the notice under paragraph (c). 19 Section 719-5(4) was amended by the 2010 Amending Act, with retrospective effect. That section and subss (5) and (6) now read: (4) If: (a) a MEC group consists of the members of a potential MEC group derived from one or more eligible tier-1 companies of a top company; and (b) at a particular time after the MEC group came into existence, one or more other companies become eligible tier-1 companies of the top company; and (c) the *provisional head company of the MEC group makes a choice in writing no later than the day mentioned in subsection (6): (i) specifying one or more of the companies mentioned in paragraph (b); and (ii) stating that the specified companies are to become members of the MEC group with effect from that time; and (d) if: (i) a company specified in the choice was a member of another MEC group immediately before that time; and (ii) all of the eligible tier-1 companies in that other MEC group became eligible tier-1 companies of the top company at that time; each eligible tier-1 company in that other MEC group is specified in the choice; then, with effect from that time, the MEC group mentioned in paragraph (a) is taken to consist of the potential MEC group derived from time to time from whichever one or more of the following companies continue to be eligible tier-1 companies of the top company: (e) the companies mentioned in paragraph (a); (f) the companies specified in the choice. Note: The provisional head company of the group must give the Commissioner a notice in the approved form containing information about each entity that becomes a subsidiary member of the group on that day because of the choice (see sections 719-77 and 719-80). (5) To avoid doubt, paragraph (4)(a) applies to a MEC group even if the composition of the group has been worked out because of one or more previous applications of subsection (4). (6) The day mentioned in paragraph (4)(c) is: (a) if the company mentioned in subsection (6A) is required to give the Commissioner its *income tax return for the income year during which the time mentioned in paragraph (4)(b) occurs – the day on which that company gives the Commissioner that income tax return; or (b) otherwise – the last day in the period within which that company would be required to give the Commissioner such a return if it were required to give the Commissioner such a return. … 20 The 2010 Amending Act contains a transitional provision giving taxpayers a choice to apply the old law. Item 193 provides: (1) The amendments made by this Part apply in relation to a consolidated group or MEC group on or after: (a) if the head company of the consolidated group (or the head company or provisional head company of the MEC group) makes a choice in accordance with subitems (2) and (3) – 10 February 2010; or (b) otherwise – 1 July 2002. (2) A choice mentioned in paragraph (1)(a) must be made: (a) on or before 30 June 2014; or (b) within a further time allowed by the Commissioner. (3) A choice mentioned in paragraph (1)(a) must be made in writing. 21 The applicants have not made a choice to apply the old law. Accordingly, the questions are to be determined on the basis of the current law. Before turning to consider the facts and the application of the provisions to those facts, it is necessary to note that one reason why the applicants have not made a choice to apply the old law is because the respondent has told the applicants that the Commissioner does not have the power to extend the period in which they may make a choice that GEMIH join the GECFAsia MEC Group: cf MW McIntosh Pty Limited v Commissioner of Taxation (2009) 178 FCR 100. 22 Against that statutory background, I turn to consider the facts. C. FACTS 23 GECFAsia and GECA were indirectly wholly owned subsidiaries of General Electric Capital Corporation (GECC), a company incorporated in the United States. On 1 July 2003 (the earliest possible date under Pt 3-90 of the 1997 Act (old law)), a "potential MEC group" existed comprised of GECFAsia and GECA as eligible tier-1 companies (within the meaning of s 719-15 of the 1997 Act) of GECC, a "top company" within the meaning of s 719-20 of the 1997 Act: s 719-10 of the 1997 Act. Neither GECFAsia nor GECA were members of another MEC group or consolidated group. 24 From June 2003 to May 2004, the applicants discussed forming a MEC group for the purposes of Div 719 of the 1997 Act (old law). Two alternatives were proposed: 1. GEMIH and GECA would form a consolidated group on 1 January 2004; or 2. GECFAsia and GECA would form the GECFAsia MEC Group on 1 July 2003, with GEMIH joining on its date of incorporation, 10 November 2003. 25 In early 2003, Christopher Vanderkley, the Chief Financial Officer of the Treasury and Corporate area of the Australian and New Zealand subsidiaries of General Electric Company (GE) and the Tax Director of the Australian GE group (Vanderkley), established an internal compliance project to prepare the Australian GE group for Australia's new income tax consolidation regime in Pt 3-90 of the 1997 Act (old law). The project became known as "Project Musketeer". Steering Committee 26 In June 2003, a Steering Committee was formed to monitor the project. The Steering Committee included Vanderkley, representatives from each of GE's major business units, a senior Australian GE group IT manager and the GE group's Australian legal Counsel. The role of the Steering Committee was a matter of dispute. The Commissioner submitted that its role was to approve the project's Charter and approve major project decisions. The applicants rejected that description of the role of the Steering Committee. 27 A document entitled "Australian Tax Consolidations Project Charter" dated 3 June 2003, prepared by Christopher Davies, the tax reporting and compliance manager of GECFAsia (Davies) and Fiona Yip (a GE accountant), was in evidence. It was marked "draft". No other version of the document was produced. It lists Vanderkley as the "Project Sponsor" and Davies as the "Project Leader". Davies was not a member of the Steering Committee. However, the front page of the Charter records that approvals were required by Vanderkley, named representatives from each of GE's major business units, a named senior Australian GE group IT manager (all members of the Steering Committee) and Davies. That Davies' approval was required was not surprising given his role and the complexity of the taxation issues under Pt 3-90 of the 1997 Act (old law). 28 At Appendix E to the Charter, specific roles and responsibilities of "Project Members" were defined, in part, as follows: Role Responsibilities Name % Allocated Program Sponsor • Setting Project Goals … Vanderkley 25% • Gaining Project approvals & funding • Chairing the Steering Committee • Key liaison with the US Tax team • … • Resolving conflicts / issues Program Leader • Defining the Project … Davies 100% • … • Design & communicate final consolidated group structure • Subject matter expert on tax advice • … • Resolving conflicts / issues • … … Steering Committee • Approving the Project Charter … Vanderkley 10% • Approval of major project decisions … Toohey • … … Cameron … Cooke … Kelly … Lane US Tax Team • Provide advice towards consolidated structure options available … Martin As required • Analyse impact of consolidated structure from a US and IRS perspective … Marrs • Approval of final consolidated structure … Beams … 29 From March 2003 until 26 May 2004, the proposed consolidated groups and membership of each group were constantly under review and changed frequently. 30 For example, Davies prepared a spreadsheet of the "Consolidateable (sic) Groups" as at 30 June 2003 (the August 2003 Spreadsheet) containing the following details: Top Company Head Company Tier 1 Company Subsidiary Members Entry Date … Comments The August 2003 Spreadsheet was printed on 4 August 2003. It comprised four pages and listed the entities in the "GE Tax Consolidations". Numerous consolidatable groups were identified. On the printed spreadsheet, GE Mortgage Insurance Pty Ltd (Old GEMI) and its wholly owned subsidiary, GE Capital Mortgage Insurance Corporation (Australia) Pty Ltd (Old GEMICO), were listed as subsidiaries of GECA which was identified as a possible head company. Genworth IPO 31 From March 2003 until 26 May 2004, the GECC group also undertook extensive planning for a potential initial public offering (IPO) of its global lenders' mortgage insurance businesses. In Australia, the businesses were conducted by two wholly owned subsidiaries of GECA – Old GEMI and Old GEMICO. GE decided to aggregate its global lenders' mortgage insurance businesses under a US company, Genworth Financial Inc (Genworth), which was to be the company listed in the IPO. Old GEMI and Old GEMICO were not direct or indirect subsidiaries of Genworth. The Australian global lenders' mortgage insurance business needed to be owned by direct or indirect subsidiaries of Genworth so that it could be included in the IPO. Vanderkley was told of the IPO in about October 2003, some four months after the commencement of Project Musketeer. Richard Hendriks (Hendriks), a director of Greenwoods & Freehills Pty Ltd (an incorporated legal practice specialising in taxation advice), was engaged in September 2003 to assist in advising GECFAsia on the IPO. 32 For the purposes of the IPO, Old GEMI and Old GEMICO would transfer the assets and liabilities of their lenders' mortgage insurance businesses to a new company, GEMICO, which was a wholly owned subsidiary of a new holding company, GEMIH. GEMIH was a wholly-owned indirect subsidiary of Genworth which, in turn, was a wholly-owned subsidiary of GECC (a non-resident). It was for this purpose that GEMIH and GEMICO were incorporated on 10 November 2003. As a result, on the date of its incorporation (10 November 2003), GEMIH was an eligible tier-1 company of GECC for the purposes of s 719-15 of the 1997 Act. 33 Around November 2003, Vanderkley, together with Graeme Barns (a tax manager who reported to Vanderkley) (Barns) and Davies, decided they would seek Steering Committee approval for GEMIH and GEMICO to form the same MEC group as GECA, the parent company of the vendors (Old GEMI and Old GEMICO) (the GECA MEC Group): see [31] above. Vanderkley's unchallenged evidence was that the reason the companies were to join the GECA MEC Group was that there was always the possibility that the IPO would not proceed and, if that occurred, he considered the businesses of Old GEMIH and Old GEMICO should remain part of the same MEC group that they would have been part of if the transfer had not occurred at all. 34 From December 2003 to January 2004, Vanderkley, Barns and Davies continued to work on the consolidation issues. There were two outstanding issues to be finalised – (1) whether GECFAsia would join the same MEC group as GECA, GEMIH and GEMICO and (2) when the MEC group would form. Two proposals were recorded in a draft advice Hendriks provided on 17 December 2003 (17 December Memorandum) as follows: … We understand that GE proposes to form a MEC group (as defined in section 719-5) consisting of [GECA] … and [GEMIH] and their subsidiaries from 1 January 2004, and to appoint GECA as the provisional head company. We also understand that the GE group has alternative proposal in mind whereby GECA would form a MEC group with … GECFAsia … from 1 July 2003, and [GEMIH] would join that MEC group from 10 November 2003 (its date of incorporation). Under this proposal GECFAsia would be appointed as the provisional head company. … As a result of forming a MEC group containing GECA and [GEMIH] and their subsidiaries (possibly with GECFAsia), GECA (or GECFAsia) will be taken to be the owner of all of the assets and liable for all the liabilities of the MEC group for Australian tax purposes. This is a consequence of the single entity rule in section 701-1 under which all of the other entities in the MEC group are taken to be part of GECA (or GECFAsia). Consequently, the transfer [the transfer of the Australian global lenders' mortgage insurance business] under the Scheme will be ignored as it is effectively a transfer between divisions of the same legal entity. After the transfer, the assets will still be deemed to be owned by GECA (or GECFAsia). Even though New GEMI has provided consideration for the transfer, the transferred assets will not have their tax cost reset. That is, for Australian tax purposes GECA ([or] GECFAsia) will remain the owner of the assets with the same tax cost as existed prior to the transfer. … 35 By early January 2004, the August 2003 Spreadsheet had been substantially amended. The amendments were recorded by Davies in handwriting on the spreadsheet. The amendments were agreed by Vanderkley, Barns and a Paul Krakauer on 7 January 2004. The amendments included Old GEMI and Old GEMICO joining a consolidatable group with GECFAsia as the head company with an entry date of 1 July 2003. 36 On 12 January 2004, Davies sent an email to Barns, Vanderkley and Paul Krakauer enclosing a spreadsheet showing "our agreed status of the consolideatable (sic) groups for the Capital and Funding entities" (the 12 January 2004 Spreadsheet). The email went on to state: The … spreadsheet ties into the structure chart identifying each group and its entry date into consolidations as either 1 July 2003 or 1 January 2004. There are 3 questions that [Barns] agreed to follow up. They are noted on the spreadsheet in the comments column and are: • [Barns] to advise whether GECA/Mortgage Insurance group to form MEC with GECFA'sia [sic] group effective 1 July 2003 or, whether these 2 groups to remain separate. … 37 On 19 January 2004, Davies sought advice from Hendriks. The question Davies posed for Hendriks was: Our consol group (GECA and old Mortgage subs) is forming as at 1 July 2003. The 2 new Genworth entities were incorporated in November 2003. They are dormant from date of incorporation until first balance date, being 31 December 2003. They will join our existing consol group from November 2003 and thereby change our consol group into a MEC group at that date. Could you please consider the implications of this change of status from a consol group to a MEC group. The question posed recognises, as was the fact, that GEMIH and GEMICO were incorporated in November 2003, were dormant from incorporation until 31 December 2003 and that they would join the existing consolidated group from the date of incorporation. The question is important because the detail of GEMIH and GEMICO on the 12 January 2004 Spreadsheet inaccurately recorded their incorporation as "Sept". 38 On 15 January 2004, a conference call was held attended by, among others, Hendriks and Davies. A handwritten note by Davies on 15 January 2004 records, as was the fact, that Hendriks would provide a note of the discussions and conclusions at that meeting. He did on 28 January 2004 in the form of a memorandum (28 January Memorandum). Before receiving the memorandum, Davies wrote again to Hendriks on 19 January stating: Our consol group (GECA and old Mortgage subs) is forming as at 1 July 2003. The 2 new Genworth entities were incorporated in November 2003. They are dormant from date of incorporation until first balance date, being 31 December 2003. They will join our existing consol group from November 2003 and thereby change our consol group into a MEC group at that date. Could you please consider the implications of this change of status from a consol group to a MEC group. 39 The 28 January Memorandum from Hendriks set out the issues discussed on 15 January and the additional question posed by Davies on 19 January. The 28 January Memorandum described the alternatives then under consideration as follows: … It is proposed that a consolidated tax group will be formed with effect from 1 July 2003 with GECA as the head company and the initial subsidiary members being … [Old GEMI] and [Old GEMICO]. In November 2003, two new Australian companies (called for present purposes, [GEMIH] and [GEMICO]) were incorporated as subsidiaries of Genworth for the purpose of acquiring the mortgage insurance business assets from [Old GEMI] and [Old GEMICO]. It is intended that GECA and [GEMIH] and [GEMICO] will form a … [MEC group], effective from the time [GEMIH] and [GEMICO] are incorporated in November 2003. Subject to obtaining court approval, [Old GEMI] and [Old GEMICO] will transfer the mortgage insurance business to [GEMICO] and, shortly afterwards, approx 30% of Genworth will be floated in an IPO. Two other Australian subsidiaries (GE Mortgage Insurance Finance Holdings Pty Limited and GE Mortgage Insurance Finance Pty Limited, together "the Genworth finance companies") were incorporated as subsidiaries of Genworth in November 2003 for the purpose of financing the acquisition of the mortgage insurance business by [GEMICO]. The Genworth finance companies will not be part of the GEC AMEC Group. As an alternative to GECA forming a consolidated group on 1 July 2003, consideration is also being given to [GECFAsia] forming a MEC group with GECA with effect from 1 July 2003 with [GECFAsia] as the nominated head company ("the Alternate Proposal"). In this event, [GEMIH] and [GEMICO] would simply become part of the [GECFAsia] MEC Group at the time those companies are incorporated. The memorandum again recorded, as was the fact, that GEMIH and GEMICO were incorporated in November 2003. As is apparent, a decision had still not been made on which alternative would be adopted. 40 On 6 February 2004, Davies sent a further version of the spreadsheet to Barns and the GE US Corporate tax team. Questions to be answered were identified. One question was "[Barns] to advise whether GECA group to form MEC with GECFA'sia (sic) group, effective 1/7/03 (7/1/04)". The spreadsheet recorded, in Davies' handwriting, two important matters he was told by Barns. First, that on 16 February 2004 no decision had been made and, secondly, that on 27 February 2004, Barns told him that "NOW 99% CERTAIN THAT THIS GROUP WILL FORM MEC [WITH] GECFASIA". The reference to the "group" was, of course, a reference to the GECA MEC Group. Davies accepted in cross-examination that his note did not record a final decision having been made. 41 Preceding the discussion on 27 February, Hendriks sent a further memorandum to, among others, Vanderkley and Barns dated 20 February 2004. Hendriks prepared it for the purposes of obtaining the necessary court approval for the transfer of the assets and liabilities of the lenders' mortgage insurance businesses to GEMICO, the wholly owned subsidiary of GEMIH. Again, this memorandum contained a description of the alternatives: … We understand that it is proposed that a [MEC] group (as defined in section 719-5) will be formed consisting of [GECA] and GEMI Holdings and their subsidiaries from 1 January 2004, and to appoint GECA as the provisional head company. We also understand that the General Electric group has alternative proposal in mind whereby GECA would from a MEC group with [GECFAsia] from 1 July 2003, and [GEMIH] would join that MEC group from 10 November 2003 (its date of incorporation). Under this proposal [GECFAsia] would be appointed as the provisional head company. Australian tax analysis Transfer of assets and liabilities under the Scheme As a result of forming a MEC group containing GECA and [GEMIH] and their subsidiaries (possibly with [GECFAsia]), GECA (or GECF Asia) will be taken to be the owner of all of the assets and liable for all of the liabilities of the MEC group for Australian tax purposes. This is a consequence of the single entity rule in section 701-1 under which all of the other entities in the MEC group are taken to be part of GECA (or [GECFAsia]). Consequently, the transfer under the Scheme will be ignored as it is effectively treated as a transfer between divisions of the same legal entity. After the transfer, for Australian tax purposes the assets will still be deemed to be owned by GECA (or [GECFAsia]) with the same tax cost as existed prior to the transfer. 42 After receiving that advice, Vanderkley discussed the memorandum with Barns and Davies. His evidence was that the conversation took place in late February or early March 2004. He does not recall the precise date of the conversation or the precise discussions. His evidence, however, was that he decided that the better course would be for GECFAsia to form a MEC group with GECA, being the second alternative proposal discussed in Hendriks' 20 February memorandum: see [41] above. The decision was not formally recorded. Vanderkley's evidence was that, consistent with adopted practice, he expected and believed the decision to be recorded by Davies in a spreadsheet. Davies did not refer to this conversation in his evidence. Davies only referred generally to filling out the 7024 (and 7025) Form on the basis of his "understanding" of the composition of the GECFAsia MEC Group. Davies was cross-examined about where his "understanding" that GEMIH would join the GECFAsia MEC Group once it became eligible to do so upon incorporation on 10 November 2003 came from. Davies could only point to the discussions generally between himself and Vanderkley, and the recording in the spreadsheets that GEMIH was incorporated in "Sept". 43 In any event, matters progressed. The applicants obtained approval from the Federal Court for the transfer of the insurance businesses to GEMICO on 1 March 2004: see The Application of GE Mortgage Insurance Pty Ltd [2004] FCA 154. The approved transfer date was 31 March 2004. It is this transfer which gives rise to the capital gain the subject of the Pt IVC Proceeding. The applicants contend that because GEMICO was at the time of the transfer a member of the GECFAsia MEC Group, the transfer of the businesses to GEMICO must be ignored for income taxation purposes by reason of the single entity rule in s 701-1 of the 1997 Act. The respondent contends that, at the time of the transfer, GEMICO was not a member of the GECFAsia MEC Group and the transfer is subject to capital gains tax. As noted above, the choice of joinder can be made at any time up until the filing of the return, which in the present case did not occur until 2004. 44 On 2 March 2004, Davies produced another spreadsheet. It would appear that this spreadsheet preceded the discussion referred to in [42] above. I say that because the spreadsheet records, now in typewritten form, the statement that Barns was "now 99% certain that GECA group will form MEC group with GECFA'sia [sic] group, effective 1/7/03 (27/2/04)". The final spreadsheet tendered in evidence was printed on 23 April 2004. It contains the same entry. 45 On 25 May 2004, the shares of Genworth floated on the New York Stock Exchange. As a result, Genworth ceased to be a wholly owned subsidiary of GECC and GEMIH and its subsidiary, GEMICO, ceased to be able to be members of the GECFAsia MEC Group. The issue however remains – did they, retrospectively, join that MEC group from the date of incorporation (10 November 2003) until 25 May 2004? 46 A meeting of the Steering Committee was then held on 26 May 2004 to formally approve Vanderkley's recommendation: see [42] above. In particular, on 26 May 2004 the Steering Committee was to approve of the consolidation and the MEC groups to be formed in Australia. Such approval was obtained. Vanderkley did not attend the meeting. Instead, Davies presented the final composition of the GECFAsia MEC Group to the Steering Committee. Under the heading "Finalisation of Group Structure", the minutes recorded that one of the "Groups entering consolidations on 1 July 2003" was the GECFAsia MEC Group. So far so good. The difficulty according to the respondent is that the minutes list GEMIH and its wholly owned subsidiary GEMICO under the heading of "GECFAsia". As is apparent, 1 July 2003 predates GEMIH and GEMICO's incorporation. The minutes did not refer to the date of their incorporation or that they had left the potential group by 26 May 2004, the date of the meeting. 47 On 12 July 2004, directors of GECFAsia, GECA and GEMIH each passed the following resolutions: 1. That the Company [respectively, GECFAsia, GECA or GEMIH], being an eligible tier-1 company as defined in the tax consolidations legislation, elects to form a Multiple Entry Consolidated (MEC) Group with [GECA] and [GEMIH] (both eligible tier-1 companies as defined in the tax consolidations legislation), the full membership of the MEC Group to be determined by reference to General Electric Capital Corporation, the ultimate foreign parent company of [GECFAsia, GECA and GEMIH]. 2. That [GECFAsia] is nominated as the Provisional Head Company of the MEC Group so formed. 3. That the MEC Group so formed formally enters into tax consolidation with effect from 1 July 2003. (Emphasis added.) 48 As the respondent submitted, these resolutions record a choice pursuant to s 719-50 of the 1997 Act to form the GECFAsia MEC Group with effect from 1 July 2003 and the appointment of GECFAsia as the provisional head company of that group: see [17] above. The resolutions do not record that GEMIH was to become a member of that group on 10 November 2003, its date of incorporation. Unfortunately, it appears to proceed on a wrong factual premise – that GEMIH existed on 1 July 2003. It did not. It did however record what was intended – that GEMIH was to be a member of the GECFAsia MEC Group. 49 Next, the information given to the Commissioner. It was provided in the 7024 Form on 18 August 2004. The contents of the form are important. Davies filled in the 7024 Form after the Steering Committee's approval on 26 May 2004 (see [46] above) and after the resolutions were signed: see [47] above. Davies did not sign the 7024 Form. The 7024 Form was signed by Vanderkley as public officer of GECFAsia and by the public officers of GECA and GEMIH. 50 Part 1 of the 7024 Form contained the provisional head company details. It listed GECFAsia and identified the chosen date of consolidation as at 1 July 2003. Part 2 contained a declaration from the public officer of GECFAsia that the information given in the form was true and correct. The declaration was made by Vanderkley, as the public officer, on 13 July 2004. Part 3 listed the "current members" of the GECFAsia MEC Group. It included GEMIH. The 7024 Form contained a section which could be completed if that entity "joined after date of consolidation". The section was not completed. The applicants contend that the failure to include the date in Part 3 was an administrative or clerical error. 51 However, consideration of the 7024 Form cannot stop there. Part 4 was entitled "Previous member/s" and it stated: List any entities, including eligible tier-1 companies, who have already left the group. … • Any eligible tier-1 company which has already left the group must also complete part 5. … For each eligible tier-1 companies who had already left the group, the 7024 Form contained a section which could be completed for notifying the date the entity joined the group if that date had not previously been notified. GEMIH and GEMICO should also have been included in Part 4 as they had left the group by the time the 7024 Form was lodged. 52 Part 5 was headed "Appointment of provisional head company by eligible tier-1 companies joining the group" (emphasis added). Part 3 contained the instruction that Part 5 be completed by "[a]ny eligible tier-1 company joining the group" (emphasis added). Section B of Part 5 was "to be completed by the public officer of each eligible tier-1 company (including any which have already left the group)". As a matter of commonsense, on the date of appointment (in this case, 1 July 2003) the provisional head company could only have been appointed by a foundation company. 53 The respondent contends that Part 5 was to be completed by the public officer of each eligible tier-1 company (including any which had already left the group) which formed the group: s 719-60(1) of the 1997 Act. The respondent sought to make much of the fact that the public officer of GEMIH signed Part 5 of the form. I reject that criticism. The wording of the 7024 Form is far from clear. The instructions in Part 5 are not framed as the respondent contends. I accept that the public officer of the named eligible tier-1 company certified the appointment of the named company as the provisional head company which "we chose to consolidate on and after the date listed in A above" and that, in this case, the date is 1 July 2003. However, given the heading, it is by no means clear that an eligible tier-1 company that later joined the group was not also required to complete Part 5. 54 On 27 August 2004, the respondent told GECFAsia that he had recorded the formation of the GECFAsia MEC Group including GEMIH and GEMICO. The respondent did not know and therefore could not identify the fact that GEMIH and GEMICO joined from the date of their incorporation. 55 Since August 2004, the applicants have prepared their taxation affairs on the basis that GEMICO was a member of the GECFAsia MEC Group from 10 November 2003 (the date of incorporation) until 25 May 2004. D. ANALYSIS 56 The principal issue is an exercise in statutory construction. Resolution of that question must begin in the text of the statute: Spencer v The Commonwealth (2010) 241 CLR 118 at [50] and the authorities there cited. 57 What is required for s 719-5(4) of the 1997 Act? It is necessary to restate s 719-5(4): If: (a) a MEC group consists of the members of a potential MEC group derived from one or more eligible tier-1 companies of a top company; and (b) at a particular time after the MEC group came into existence, one or more other companies become eligible tier-1 companies of the top company; and (c) the *provisional head company of the MEC group makes a choice in writing no later than the day mentioned in subsection (6): (i) specifying one or more of the companies mentioned in paragraph (b); and (ii) stating that the specified companies are to become members of the MEC group with effect from that time; and … then, with effect from that time, the MEC group mentioned in paragraph (a) is taken to consist of the potential MEC group derived from time to time from whichever one or more of the following companies continue to be eligible tier-1 companies of the top company: (e) the companies mentioned in paragraph (a); (f) the companies specified in the choice. (Emphasis added.) 58 The cumulative statutory requirements for a valid choice are: 1. a potential MEC group is in existence: s 719-5(4)(a); 2. at a particular time, another company (the joining company) becomes an eligible tier-1 company of that potential MEC group: s 719-5(4)(b); 3. a choice is made in writing by the provisional head company that the joining company will join the existing MEC group: s 719-5(4)(c); 4. the choice is made before the relevant income tax return is lodged: s 719-5(6). 59 It is common ground that the first statutory requirement is satisfied – the GECFAsia MEC Group came into existence on 1 July 2003. It is also common ground that GEMIH became an eligible tier-1 company of the GECFAsia MEC Group on 10 November 2003 for the purposes of the second statutory requirement. The relevant date for the purposes of the fourth statutory requirement is 15 September 2004, which is clearly subsequent to the events described above. Thus, this requirement is uncontentious. 60 The main issue in dispute is whether the third statutory requirement is satisfied. That third statutory requirement requires affirmative answers to two questions: 1. Was a choice made by GECFAsia for GEMIH to join the GECFAsia MEC Group on 10 November 2003? and 2. Was that choice made in writing? (1) Was a choice made for GEMIH to join the GECFAsia MEC Group? 61 The applicants contend that GECFAsia "chose" for GEMIH and GEMICO to join the GECFAsia MEC Group upon incorporation on 10 November 2003 and that the failure to expressly stipulate this choice in the 7024 Form was an administrative error (see [5] above). In support of this contention, the applicants sought to establish that Vanderkley made this decision on behalf of GECFAsia and that his decision was evidenced in writing by the cumulative effect of a series of documents which can be read together. 62 That contention raises two further questions: (a) Did Vanderkley have authority to make the "choice" on behalf of the applicants? (b) If Vanderkley did have authority, did Vanderkley make the "choice" that GEMIH and GEMICO would join on 10 November 2003? I will address each question in turn. (a) Did Vanderkley have authority to make the "choice" on behalf of the applicants? 63 The applicants submitted that Vanderkley was authorised to make decisions regarding all aspects of the tax compliance obligations of the applicants. The applicants contend that it would be unrealistic to suggest that its board of directors, or the Steering Committee, were the repositories for the making of the "choice", and that consistent with commonsense, technical decisions like this were made by the head of tax, Vanderkley. Thus, the applicants submitted, Vanderkley had express authority to make the choice, and further or alternatively, had implied authority by reason of his office. 64 The applicants referred to Telstra Corporation Ltd v Ivory [2008] QSC 123 in support of its contention that senior executives in particular fields can, as a matter of necessity, be the corporate mind of the company. That case involved an application by Telstra to set aside a statutory demand that had been served on it by a Mr Ivory. Mr Ivory submitted the application was invalid because Telstra's board had not resolved to commence the proceeding. In rejecting that submission, Lyons J stated at [83]-[85]: [83] There is no requirement for there to have been a resolution of the Board of Directors of Telstra to apply to set aside the statutory demand. Telstra is a large company and its functions are necessarily restricted by its size. Rogers CJ in AWA Ltd v Daniels trading as Deloitte Haskins & Sells stated that: … many companies today are too big to be supervised and administered by a board of directors except in relation to matters of high policy. The true oversight of the activities of such companies resides with the corporate bureaucracy. Senior management and, in the case of mammoth corporations, even persons lower down the corporate ladder exercise substantial control over the activities of such corporations involving important decisions and much money. It is something of an anachronism to expect non-executive directors, meeting once a month, to contribute anything much more than decisions on questions of policy and, in the case of really large corporations, only major policy. This necessarily means that, in the execution of policy, senior management is in the true sense of the word exercising the powers of decision and of management which in less complex days used to be reserved for the board of directors. [84] Moreover, some executives below Board level can have implied actual authority from the usual authority attached to their office. In AWA, Rogers CJ stated that "… [i]mplied authority is conferred to do whatever is necessarily, or normally, incidental to an activity expressly authorised." [85] Dal Pont, citing Lord Denning's decision in Hely-Hutchinson v Brayhead Ltd, states that: [t]he law is that when a board of directors appoint one of their number to be managing director … [t]hey thereby impliedly authorise him to do all such things as fall within the usual scope of that office. (Footnotes omitted.) 65 Thus, the applicants contended, Vanderkley had implied authority by reason of his office to be the person to make the choice. For the reasons set out below, I accept that Vanderkley had the requisite authority. 1. It was Vanderkley's decision to establish Project Musketeer and the Steering Committee. The Steering Committee was set up voluntarily, in order to ensure the involvement of senior officers of the applicants. There was no imperative to do so. 2. There was some debate between the parties as to whether it was Vanderkley himself, or the Steering Committee, who had the authority to make final decisions such as the decision for GEMIH and GEMICO to join the GECFAsia MEC Group (see [26] above). The role of the Steering Committee, as set out in the Charter (see [28] above), was to approve "major project decisions". It was accepted by Vanderkley in cross-examination that the decision as to which companies to consolidate and from when, was a major project decision which required Steering Committee approval. However, I accept the applicants' evidence that it was he who made the substantive decision, and that Steering Committee approval was a mere formality and not necessary for a decision to become a decision of the applicants. In cross-examination, Vanderkley stated that: I made the decisions around the various – particularly around which groups would form and which groups would join and that they were then presented to the steering committee who then were asked to, I guess, by way of formality, approve my decisions. … I would say that the decision having been made by me, whilst it was part of the process that we went through, in setting up the steering committee the steering committee was all about getting buy in from the other CFOs and the other key people about the project. But the – if the steering committee hadn't approved that then I'm not sure that that was critical in terms of the process. 3. Vanderkley would consult with Barns and Davies, but decisions were ultimately made by him. Vanderkley gave evidence, which I accept, that the decision for GECFAsia to form a MEC group with GECA, and for that decision to be put to the Steering Committee in May 2004, was ultimately his. 4. Board resolutions were passed regarding the decision to consolidate. The respondent submitted that it is to be inferred from that fact that it was the boards of GEMIH, GECA and GECFAsia which had the responsibility for making such a decision. I reject that inference. Vanderkley's evidence, which I accept, was that the purpose of the board resolutions was to communicate the finalisation of the project to the board. This was done as a matter of good governance, not because Vanderkley otherwise lacked the power to implement the consolidation decision. 5. The Charter listed "Approval of final consolidated structure" as a responsibility of the US Tax Team. When asked in cross-examination whether this accurately reflected the US Tax Team's role, Vanderkley stated: Insofar as the approval of it, no, I don't believe they had the final say-so in the consolidated structure but they – being a US corporation we had to take into account anything that would have an impact potentially on the US businesses. It's where it's listed on the stock exchange so their input would have been crucial in making sure that they were also happy with the final decisions that were being made ... we wouldn't have created a structure with which they were not satisfied was not the right one for the whole of the GE group. Thus, the US Tax Team could aptly be described as having a right of veto in respect of decisions made by Vanderkley. This does not, however, detract from the essential character of Vanderkley's role, being one of decision-maker. 66 The applicants submitted that irrespective of the conclusion reached above, as Vanderkley was a public officer of GECFAsia, s 252(g) of the Income Tax Assessment Act 1936 (Cth) applies, rendering questions of actual authority otiose. 67 Section 252(g) provides that: Everything done by the public officer which he is required to do in his representative capacity shall be deemed to have been done by the company. The absence or non-appointment of a public officer shall not excuse the company from the necessity of complying with any of the provisions of this Act or the regulations, or from any penalty for refusal or failure to comply therewith, but the company shall be liable to the provisions of this Act as if there were no requirement to appoint a public officer. 68 The applicants submitted that in 2004 Vanderkley was required to give the "approved form", and did so as a public officer, and that therefore as a matter of law, once he signed the form and gave it to the respondent, GECFAsia was deemed to have done it. Thus, Vanderkley's decision is deemed to be a decision of GECFAsia. I accept that submission. If it were otherwise, the result would create administrative uncertainties for taxpayers as well as the respondent. (b) If yes, did Vanderkley make the "choice" that GEMIH and GEMICO would join on 10 November 2003? 69 Following the decision to seek Steering Committee approval for GEMIH and GEMICO to join the same MEC group as GECA (see [33] above), Vanderkley continued to work on the consolidation, specifically on whether GECFAsia would join that same MEC group, and when the MEC group would form. These issues were canvassed in the 20 February memorandum (see [41] above) which Vanderkley read at the time. Importantly, the memorandum stated that: We also understand that the General Electric group has alternative proposal in mind whereby GECA would from a MEC group with [GECFAsia] from 1 July 2003, and [GEMIH] would join that MEC group from 10 November 2003 (its date of incorporation). Under this proposal, GECFAsia would be appointed as the provisional head company. (Emphasis added.) The applicants submitted that following receipt of that advice, Vanderkley decided that the better course was this "alternative proposal" described directly above. That is, the applicants contend that a "choice" was made by Vanderkley for GEMIH and GEMICO to join the GECFAsia MEC Group from 10 November 2003. 70 Davies recorded decisions made by Vanderkley in his spreadsheet. The 12 January 2004 Spreadsheet (and the spreadsheets thereafter) contained the comments "Part of Genworth. Incorporated Sept, dormant until 31/12/03 (7/1/04)" alongside GEMIH and "Part of Genworth. Incorporated Sept, dormant until 31/12/04 (7/1/04)" alongside GEMICO. Davies gave evidence that those comments indicated that those entities would join on their date of incorporation. Of course, the reference to "31/12/04" and the two references to "Sept" were wrong. The first was said to be a typographical error. The reference to "Sept" instead of November was simply stated to be a mistake. Davies stated in cross-examination that: … the fact that I have written in there that they have been incorporated on the date subsequent to 1 July 2003 was put there by myself to remind me at the time that I was filling the forms in that they had joined at a later date and I should notify that on the forms appropriately. 71 Davies also deposed to having: … entered these notes into the spreadsheet on or about 7 January 2004 as a reminder to myself that no income tax calculations would be required for these companies for the year ended 31 December 2003 and that the respondent would have to be notified of the entry date of those companies into consolidations which at that time I also by mistake thought to be September 2003 instead of the actual date of incorporation being 10 November 2003. 72 Despite these steps being taken, the respondent submitted that the necessary "choice" was not made. The respondent submitted, in effect, that the only "choice" that can be gleaned from the documents was a choice that a MEC group be formed with all the entities listed in the 7024 Form (including GEMIH and GEMICO) from 1 July 2003. In support of that contention, the respondent pointed to the following: 1. Spreadsheets prepared by Davies: No version of the spreadsheets prepared by Davies records that GEMIH and GEMICO would join the GECFAsia MEC Group on 10 November 2003. 2. Steering Committee minutes: The Steering Committee minutes did not stipulate that GEMIH and GEMICO would join the GECFAsia MEC Group at a later date to 1 July 2003. 3. Board resolutions: The circular resolutions of the board of directors of GECA, GECFAsia and GEMIH were for the formation of a MEC group under s 719-50 of the 1997 Act with effect from 1 July 2003, and the appointment of GECFAsia as the provisional head company. These choices, reflected in the resolutions, are consistent with the content of the 7024 Form, but are substantively different to the alleged "choice" for GEMIH and GEMICO to join the GECFAsia MEC Group on 10 November 2003. 4. Memoranda: The 17 December Memorandum (see [34] above) and 28 January Memorandum (see [38]-[39] above) (which mention joinder on 10 November 2003) did not go to Vanderkley. 5. Part 5 of the 7024 Form: Davies appreciated that Part 5 of the 7024 Form involved the appointment of the head company, but included GEMIH as one of the companies making that appointment. Vanderkley's intention was that both GEMIH and GECA should appear in Part 5, notwithstanding that GEMIH did not exist as at 1 July 2003 and therefore could not have joined in the appointment of GECFAsia. 6. No other document: There is no document which records a decision made by the first applicant that GEMIH (or GEMICO) would become a member of an existing MEC group on 10 November 2003, rather than join in the formation of the group from 1 July 2003. The "choice" described at [69] above was not documented. 73 I will take each of the documents in turn: 1. Spreadsheets prepared by Davies: The spreadsheets, while they did not refer to 10 November 2003, did refer to GEMIH and GEMICO joining later than 1 July 2003. Davies gave evidence that the comments "Part of Genworth incorporated Sept. Dormant until 31/12/03 [or 31/12/04]" (see [70] above) indicated that GEMIH and GEMICO would be joining on the date of their incorporation and the statement that they were incorporated in September, which was after 1 July 2003, precluded each entity from being part of the formation of the GECFAsia MEC Group. 2. Steering Committee minutes: The applicants' evidence, which the respondent accepted, was that the minutes were there to provide the Steering Committee with enough information to be able to approve the entities that were going to be in the GECFAsia MEC Group. As Davies said in evidence, there would have been too much information, or unnecessary information, for the Steering Committee to go into further detail about the date of the joinder of GEMIH and GEMICO. 3. Board resolutions: The board resolutions were not prepared or thoroughly checked by either Davies or Vanderkley. Vanderkley did not read the resolutions in any detail prior to signing them; he simply saw that they were broadly dealing with Project Musketeer and signed them. 4. Memoranda: The 17 December Memorandum was sent to Barns. The 28 January Memorandum was sent to Davies. Vanderkley worked closely with Barns and Davies on Project Musketeer (see [33] to [46] above). In the circumstances, I find that the content of those memoranda were provided, directly or indirectly, to Vanderkley. 5. Part 5 of the 7024 Form: Davies filled out Part 5 of the 7024 Form in accordance with what he interpreted to be the instructions on the 7024 Form. The instructions were confusing, and it is by no means clear that GEMIH which later joined the group was not also required to complete Part 5: see [52]-[53] above. Moreover, I accept Davies' evidence that including GEMIH in Part 5 was not a representation that it was one of the foundation companies of the MEC group from 1 July 2003. On any view, it could not be because it did not exist at that date. 6. No other document: While the applicants cannot point to a single document which records the choice that GEMIH and GEMICO would join the GECFAsia MEC Group on 10 November 2003, they rely on the cumulative effect of the above documents. This argument is considered at [96] to [102] below. 74 The applicants' unchallenged evidence was that Davies' omission of the date "10 November 2003" in respect of GEMIH and GEMICO on the 7024 Form was a mistake, as was Vanderkley's failure to identify the omission on signing the form. The memoranda and emails (see [34], [36]-[39] and [41] above) clearly show that what was contemplated by the "second alternative" was the joinder of GEMIH and GEMICO to the already existent GECFAsia MEC Group upon incorporation on 10 November 2003. Vanderkley and Davies both gave evidence that they knew, as a matter of law, that it was impossible for GEMIH and GEMICO to join the GECFAsia MEC Group any earlier than 10 November 2003. 75 GECFAsia's tax returns for the income years 31 December 2003 and following were lodged on the basis that the GECFAsia MEC Group had formed with effect from 1 July 2003 and GEMIH and GEMICO were members from 10 November 2003 to 25 May 2004. GEMIH and GEMICO's departure from the GECFAsia MEC Group on 25 May 2004 was notified to the respondent on 7 October 2004 and again on 11 November 2004. That fact was not an issue in these proceedings. 76 In light of the above, I accept that the applicants made a "choice" that GEMIH and GEMICO joined the GECFAsia MEC Group upon incorporation on 10 November 2003. (2) If yes to 1, was that choice in writing for the purposes of s 719-5(4) of the 1997 Act? 77 The applicants submitted that the "choice in writing" requirement of s 719-5(4) of the 1997 Act was satisfied. They relied upon three alternative arguments. I will deal with each in turn. (a) Time for joining not part of the choice 78 The applicants submitted that the time for joining is not part of the choice provided or required by s 719-5(4) and explicit identification of the time in writing is not required. Instead, the applicants submitted that the time for joining is fixed by the operation of law because the statute does not grant the provisional head company any discretion as to the time of the effect of the joinder. Put another way, the applicants submitted that the choice itself implies and establishes the time of joining and that the phrase, with effect from that time in s 719-5(4), was merely descriptive and confirmatory of the statutory timing of joining that arises from the making of the choice rather than an element of express wording required for the choice to be effective. 79 In support of this contention, the applicants submitted that: 1. The language of s 719-5(4) should be contrasted with the language of ss 703-50 and 719-50, which expressly require the choice to consolidate to specify a date. In respect of those provisions, if no date is specified, the statute does not mandate one by default. Further, and in contrast to ss 703-50 and 719-50, whether or not the time appears in the choice under s 719-5(4), that time is fixed by s 719-5(4)(b). The applicants contended that Parliament could not have intended an outcome where, if the time is correctly recorded, it has no significance (because it is fixed by law), but if the time is incorrectly recorded, the choice is supposedly invalid. 2. There is no requirement for the 'writing' to be in any particular form. That is, there is no 'approved form' which must be used. It need not be signed. It need not be dated. So long as the 'writing' is reasonably capable of satisfying subparagraphs (i) and (ii) of s 719-5(4)(c), the section will be satisfied. 3. There is no requirement that the 'writing' be contained in a single document: cf P v Board of Australian Crime Commission (2006) 151 FCR 114 at [38]; Harvey v Edwards, Dunlop & Co Ltd (1927) 39 CLR 302 at 307 and 309. 4. Parliament expected that the approved form used under the old law would, in the majority of cases, contain 'sufficient information' to be considered a written choice: Tax Laws Amendment (2010 Measures No. 1) Bill 2010 (Cth) Explanatory Memorandum (the EM) at [5.416]. 5. One must thus identify whether there is 'sufficient information' in a document or documents which concerns the required choice. 6. The validity of the making of a choice is not affected by any failure to give the notice required under s 719-77. The requirement to give notice is only triggered once a valid choice has been made, and is an administrative requirement: EM at [5.366]. 7. The statutory purpose of the amended provision is apparent from its terms – to ensure that a decision for a joining company to join an existing MEC group is made prior to the lodgment of the income tax return of the provisional head company of the existing MEC group. By requiring the choice to be in writing, the statute mandates the creation of a document which relates to the making of the choice and the making of the choice at the proper time. In the applicants' submission, if a choice in writing establishes that the choice was made, and made at the proper time, then the statutory purpose of s 719-5(4) has been met and the joining company will have joined an existing MEC group. 8. The amendments made to s 719-5 by the 2010 Amending Act are remedial in nature. They were intended by Parliament to alleviate "administrative difficulties" associated with the former notice giving procedure: EM at [5.367]. New s 719-5(4), which requires a 'choice in writing', must be read in this remedial context: Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-2; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408. Further, being remedial legislation, the Court should not construe s 719-5(4) narrowly. 9. Parliament's intention in amending s 719-5 was to fix up cases in which the choice to consolidate had not been effectuated because of a technical deficiency in completing the approved form – cases such as the present. Paragraphs 5.363, 5.367 and 5.368 of the EM state that: [5.363] The requirement that these choices must be given to the Commissioner in the approved form for the choice to have effect is causing administrative difficulties. Cases have arisen where wholly-owned groups have operated for several years on the basis that they have formed a consolidated or MEC group, without having made an effective choice to consolidate because of a technical deficiency in completing the approved form. … [5.367] Therefore, the amendments will alleviate the administrative difficulties that arise when, for example: … • the approved form notifying the Commissioner that a consolidatable group or potential MEC group has chosen to consolidate contains a clerical error that has the effect of making the choice to consolidate ineffective. [5.368] In these circumstances, the amendments will ensure that a choice to consolidate a … potential MEC group remains effective despite the administrative defects relating to the written notice notifying the Commissioner of that choice. Thus, the applicants submitted, the 7024 Form contained "sufficient information" to constitute the required choice in writing under s 719-5(4). 80 The issue is not the contents of the 7024 Form. The issue is whether the choice (in writing) must state a date as the date on which the companies in question become part of the existing GECFAsia MEC Group. 81 In s 719-5(4) the critical (or at least a critical) question is what is meant by "with effect from that time" where that phrase appears in and immediately after the text of s 719-5(4)(c). "That" time can only refer back to "at a particular time" in subs (b) and the content that is to be given to that "particular" time in the circumstances of an individual case is necessarily fixed by the following elements in subs (b). That is, the "particular time" that is mentioned in subs (b) is the time at which "one or more other companies become eligible tier-1 companies of the top company". And that time is the time that is spoken of later in the section when the phrase "with effect from that time" is used – to refer to the time with effect from which the specified companies become members of the MEC group if a provisional head company makes the choice in writing of which subs (c) speaks. 82 The same point can be put another way by saying that although the provisional head company can make its choice at any time before the day mentioned in subs (6), if it does make a choice within that time, the choice is (and has to be) that the specified companies are to become members of the MEC group with effect from the time that is mentioned in subs (b) – the particular time at which the other company becomes an eligible tier-1 company. The head company neither needs to make nor is able to make any choice about the relevant date. It is a date that the 1997 Act fixes. 83 It will be recalled that s 719-5(4)(c)(ii) requires that the choice in writing state that "the specified companies are to become members of the MEC group with effect from that time". Contrary to the submissions of the respondent, that requirement did not oblige the head company to state, in its "choice in writing", a day or time at which, or circumstance as a result of which, the relevant companies became members of the MEC group. Once it is recognised that the 1997 Act fixes that time (and that there is no choice available to the head company to fix some time other than the time fixed by the 1997 Act), the provisions of subpara (c)(ii) should be read as requiring the head company to state, in its choice in writing, no more than that the specified companies are to become members of the MEC group. The date at which that takes effect is not a matter for the choosing company. It is not required to offer its view on that topic in its choice in writing. That construction of the legislation is supported by the EM (see [5.405], [5.408] – [5.427]) and commonsense. 84 If that is right (and I consider that it is), all that needs to occur is for a choice to be made. The 1997 Act then works out the consequences of the choice. More particularly, the taxpayer does not need to expressly identify (in whatever writing constitutes the choice in writing) the date on which the company in question joined the MEC Group, because the 1997 Act prescribes that date as the date on which it became an eligible tier-1 company. It must be recalled that following the amendment made to Div 719 in 2010 there ceased, retrospectively, to be any approved form for the making of a choice under s 719-5(4). Moreover, there ceased to be any requirement to give a correctly completed form to the respondent for such a choice to be made: see s 719-77(3) and EM [5.413]. There simply had to be a choice in writing specifying that an eligible tier-1 company was to join with effect from that time. The head company of the group must, of course, give the respondent relevant information relating to the choice and failure to do so may result in a penalty: ss 719-76 and 719-77 read with s 8C of the TAA; see also EM [5.366]. 85 For those reasons I consider that the requirements of s 719-5(4) were satisfied. (b) Alternative arguments 86 Given the conclusions reached so far, it is strictly unnecessary to address the alternative arguments advanced by the applicants and the respondent. However, it is appropriate to say something about each of them. (i) 7024 Form should be construed so as to supply the missing dates 87 The applicants submitted that as a matter of construction the Court should 'supply' the dates inadvertently omitted from the form. The applicants submitted that there was, inevitably, a date of joining and it would be absurd to suggest that there was no date or that the date was before GEMIH and GEMICO were incorporated. Moreover, there could only be one such date, namely, the date of incorporation of GEMIH and GEMICO. Thus, it is clear that a date was omitted and it is clear what that date was. 88 The applicants referred to the principle of construction stated by Dixon CJ and Fullagar J in Fitzgerald v Masters (1956) 95 CLR 420 at 426-7 that "[w]ords may generally be supplied, omitted or corrected, in an instrument, where it is clearly necessary in order to avoid absurdity or inconsistency." In such cases, rectification of the document is not needed: Spunwill Pty Ltd v BAB Pty Ltd (1994) 36 NSWLR 290 at 299. 89 Moreover, the mistake or omission need not be one apparent from the face of the document – the objective background context may reveal the error. In Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101 at [24], Lord Hoffmann stated that: … in deciding whether there is a clear mistake, the court is not confined to reading the document without regard to its background or context. As the exercise is part of the single task of interpretation, the background and context must always be taken into consideration. See also Holding & Barns plc v Hill House Hammond Ltd [2002] L. & T.R. 7; Codelfa Constructions Pty Ltd v State Rail Authority of NSW (1981-1982) 149 CLR 337 at 352; and Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2005) 223 ALR 560 at 573-4. 90 Context also includes matters of law. In Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181 at 188, the High Court observed that: Interpretation of a written contract involves, as Lord Hoffmann has put it: … the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract. That knowledge may include matters of law, as in this case where the obtaining of intellectual property protection was of central importance to the commercial development of Mr Allen's ironing board. (citations omitted.) 91 The applicants submitted that in the present case the relevant objective factual context included: 1. the fact that GEMIH and GEMICO were only incorporated on 10 November 2003 and, by operation of statute, could only join the GECFAsia MEC Group on that date; 2. the contents of the advices received from Greenwoods & Freehills (see [34], [39] and [41] above), in which the applicants were told that GEMIH and GEMICO could only join with effect from the date of their incorporation; 3. the email sent by Davies on 19 January 2004 (see [37] above) in which he communicated his plan for GEMIH and GEMICO to join 'from November 2003'; and 4. the spreadsheets kept by Davies (see [30], [35], [36], [40] and [44] above) which record his awareness that GEMIH and GEMICO were not in existence as at 1 July 2003 (the date of formation of the GECFAsia MEC Group). 92 Those objective facts were said to support the following findings: 1. that the applicants knew that GEMIH and GEMICO could only join from the date of their incorporation; 2. that it was the applicants' intention for these companies to join the GECFAsia MEC Group from that date; and 3. that the non-inclusion of the dates on the MEC form was an obvious omission. Therefore, the applicants submitted, the MEC form ought to be construed by the Court 'supplying' the date inadvertently omitted from the form. 93 The applicants referred to BHP Petroleum (Timor Sea) Pty Ltd v Minister for Resources (1994) 49 FCR 155 in support of the submission that the same ordinary rules of construction that apply to contracts apply to forms. In that case, the Full Federal Court concluded that even if an application letter made under statute was treated as having a "formal status as a written instrument", it could be corrected by "ordinary processes of construction", including the principles laid out in Fitzgerald v Masters (see [88] above): BHP Petroleum at 172. 94 In any event, the 7024 Form is not to be construed as if it were statutory in nature or required by a section of the 1997 Act. As noted earlier, following the amendment made to Div 719 in 2010 there ceased, retrospectively, to be any approved form for the making of a choice under s 719-5(4). Moreover, there ceased to be any requirement to give a correctly completed form to the respondent for such a choice to be made. There simply had to be a choice in writing specifying that an eligible tier-1 company was to join in accordance with s 719-5(4) of the 1997 Act. 95 The applicants argued that even if the "choice in writing" under s 719-5(4) required a statement on its face of the date from which GEMIH would join the GECFAsia MEC Group, by construing the 7024 Form to include the missing dates, the 7024 Form itself satisfied the requirements of s 719-5(4). I reject that contention. As is apparent, the construction argument depended entirely upon "including the missing dates" in the 7024 Form. On the face of the 7024 Form, it is unnecessary to include the missing dates. The 7024 Form states, incorrectly, that GEMIH would join the GECFAsia MEC Group from 1 July 2003. The difficulty is that GEMIH did not exist on 1 July 2003. It was not incorporated until 10 November 2003. (ii) Choice in writing was made in more than one document 96 If the applicants' choice for GEMIH and GEMICO to join the GECFAsia MEC Group from incorporation on 10 November 2003 had to be in writing, then the applicants were unable to point to any one document which clearly stated that the applicants had chosen for GEMIH and GEMICO to join the GECFAsia MEC Group from incorporation on 10 November 2003. Instead, as an alternative argument, the applicants relied on the cumulative effect of: 1. Email from Davies to Hendriks dated 19 January 2004: see [37] above; 2. Email from Hendriks to Barns and Vanderkley and attached memorandum dated 20 February 2004: see [41] above; 3. Spreadsheets prepared by Davies: see [30], [35], [36], [40] and [44] above; 4. Minutes of the Steering Committee meeting of 26 May 2004: see [46] above; 5. Written resolutions of the directors of each of the applicants of 12 July 2004: see [47] above; and/or 6. The 7024 Form: see [49]-[53] above. 97 The applicants submitted that when the writing in all these documents was considered together, there existed, before the first applicant lodged its first tax return as head company, a choice in writing for the purposes of s 719-5, which: 1. specified that GEMIH was to join the GECFAsia MEC Group; and 2. stated that it was to join with effect from the date of its incorporation. 98 The applicants submitted, and I accept, that neither the language, context nor purpose of s 719-5(4) precludes a consideration of a choice in writing contained in more than one document. Indeed, the respondent accepted that, as a matter of principle, the choice did not need to be contained in a single document, provided there is some linkage between the documents: Harvey v Edwards at 307; see also Australia & New Zealand Banking Group Ltd v Widin (1990) 26 FCR 21 at 29-32. 99 As the analysis of the documents at paragraph 96 above makes clear, the documents are, by implication, linked – they all concern a particular aspect of Project Musketeer: see [24] and [25] above. 100 Do they, together, however record a choice in writing that GEMIH was to join the GECFAsia MEC Group from the date of its incorporation, 10 November 2003? As has already been explained, s 719-5(4) does not require the choice to specify a date. But, if it were relevant to decide whether the documents now under consideration did record the date on which GEMIH was to join the GECFAsia MEC Group, the answer is not straightforward. 101 The 19 January 2004 email (see [37] above) records, as was the fact, that GEMIH was incorporated in November 2003 and that they would join the "our existing consol group". The difficulty is that the identity of that group had not yet been resolved and the attached spreadsheet incorrectly recorded the incorporation date as September. The first issue was still not resolved by 20 February 2004 (see [41] above) although the memorandum did accurately record GEMIH's incorporation date and record that regardless of the identity of the head or top company, GEMIH would form part of the consolidated group from its date of incorporation. By late February or early March 2004, the participants were "99% certain" that GECA group would form a MEC group with GECFAsia effective from 1 July 2003. That decision was confirmed by the Steering Committee on 26 May 2004 ([46] above) and by the meetings of the directors of each of GECFAsia, GECA and GEMIH: see [47] above. The difficulty, however, was that the Steering Committee minutes, the directors meeting minutes and the 7024 Form all inaccurately recorded that GEMIH joined from 1 July 2003 and not its date of incorporation. 102 For those reasons, the contention is rejected. The documents, when considered together, do not contain a choice in writing that GEMIH would join the GECFAsia MEC Group from incorporation on 10 November 2003. But, a choice in writing having been made under s 719-5(4), the relevant provisions of the 1997 Act were engaged. And, I would add, if it matters, it is apparent from reading the documents that it was the intention of the applicants that GEMIH would join the GECFAsia MEC Group from incorporation on 10 November 2003. It may rightly be said that the recording of that was less than satisfactory but for the reasons already given that is of no immediate consequence. (iii) If no choice was made, should the 7024 Form be rectified? 103 If contrary to the earlier conclusions no choice was made, the applicants sought rectification of the 7024 Form so that the words "10 November 2003" appeared in Part 3 of the 7024 Form next to the words "[i]f joined after date of consolidation, give date joined the group", in the sections dealing with GEMIH and GEMICO. 104 Rectification may be possible where the evidence convincingly proves that the written words of a document failed to properly express the common intention of the parties to that document. In Pukallus v Cameron (1982) 180 CLR 447, which concerned rectification of a contract, Wilson J (with whom Gibbs CJ agreed) stated (at 452) that: … there must be an intention common to both parties at the time of contract to include in their bargain a term which by mutual mistake is omitted therefrom. … The second principle governing the rectification of a contract which is material to this case is that which requires the plaintiff to advance "convincing proof" that the written contract does not embody the final intention of the parties. The omitted ingredient must be capable of such proof in clear and precise terms. The Court must not assume for itself the task of making the contract for the parties. (citations omitted.) Is a "form" capable of rectification? 105 There was no dispute that the doctrine of rectification applies equally to unilateral instruments and instruments between two or more parties: see, by way of example, Commissioner of Stamp Duties (NSW) v Carlenka Pty Ltd (1995) 41 NSWLR 329 at 345; Kent v Brown (1942) 43 SR (NSW) 124 at 128; In re Butlin's Settlement Trusts [1976] Ch 251 at 260-2 and Allnutt v Wilding [2006] EWHC 1905 (Ch) at [16]. I accept that the Court has power to rectify a unilateral document. Intention 106 Rectification turns on the subjective intentions of the maker (or makers) of a document: see Carlenka at 331-2; Butlin's Settlement Trusts at 262; Allnutt v Wilding [2007] EWCA Civ 412 at [11]. The applicants submitted that there were two 'makers' of the 7024 Form – Davies who filled it out, and Vanderkley who signed it, noting that in Butlin's Settlement Trust, evidence of intention was led from both the settlor, who executed the settlement, and the settlor's solicitor, who drafted it: see 259. In fact, in Carlenka, affidavit evidence was provided by three deponents, including the effective 'controller' of the relevant entity, and the solicitor who prepared the relevant documentation. 107 Davies' subjective intention was to include the date 10 November 2003 on the 7024 Form. His evidence in this respect was not challenged. Vanderkley's subjective intention was more generalised – it was to ensure the form was correctly completed. Thus, the applicants submitted, Davies was the primary 'maker' and the 7024 Form should be rectified to accord with his specific intention. 108 In relation to the 7024 Form, I accept that there were two 'makers'. However, Vanderkley was the primary maker and it is his intention that is relevant. The English High Court decision of Wills v Gibbs [2007] EWHC 3361 (Ch) is instructive. Wills v Gibbs concerned an application by Mr R Wills (R), as co-executor of a will, for rectification of a deed of variation which varied certain dispositions under the will. Mr P Wills (P) was given three gifts under the will which he wanted to divert to R. P wished to do so by way of a deed of variation, which would operate as if the diversion had taken effect under the will itself, so as to avoid the disposition attracting certain inheritance tax liabilities. P engaged Mr Mitchell to prepare the deed. The deed as executed but did not include certain statements prescribed by s 142 of the Inheritance Tax Act 1984 and s 62(7) of the Taxation of Chargeable Gains Act 1992, which meant that the transfer was not exempt from the tax liabilities that P had sought to avoid. R argued that only if the deed were rectified so as to include within it the statements prescribed by the legislation would it achieve the legal effect that the transferor intended. R submitted that the failure of the deed to achieve that effect was attributable to an unintended mistake by Mitchell. The three defendants – P, Mitchell and the other co-executor, Mr Gibbs – did not oppose the application. 109 Rimer J ordered rectification of the deed of variation as sought by R, so as to give effect to the legal result P had intended. Rimer J accepted that the only person whose intention in relation to the deed of variation was material was P's. It was P alone who "made" the deed. Although Gibbs and Mitchell were also parties, they did not need to be. Thus, the intention into which the Court had to inquire was P's. P's position was akin to that of a settlor who sought to rectify a settlement he created. Rimer J accepted that P did not specifically intend the deed to include the prescribed statements in relation to either inheritance tax or capital gains tax. He did not so intend because he did not know that such statements were required. But, what P did intend was to effect a disposition that would, as a matter of law, enjoy the special treatment in relation to those taxes which a deed of variation which included those prescribed statements would have enjoyed. P employed Mitchell to prepare the deed because he was a lawyer and would understand the legal requirements that had to be satisfied in order for the deed to take effect in line with P's legal intention. Thus, it was plainly P's intention (albeit an unspoken one) that Mitchell as his agent would prepare the deed in proper form so as to give effect to his commercial and legal intentions. By mistake, Mitchell omitted to include the required statement. Mitchell's evidence was that he was at the time well aware of the need to include such statements. 110 In the present case, Vanderkley's intention was for GECFAsia MEC Group to form on 1 July 2003, with GEMIH and GEMICO to join the group on 10 November 2003 (see [43] above). As the applicants submitted, Vanderkley had no specific intention as to what would be stated where on the 7024 Form. His intention was that Davies would prepare the 7024 Form in proper form so that the GECFAsia MEC Group would be properly formed and the transfer of the mortgage insurance businesses to GEMICO would be ignored for income taxation purposes. By mistake, Davies failed to include the date in the requisite spots and thereby failed to give effect to Vanderkley's intentions. 111 Regarding the evidence required to establish intention for rectification purposes, Sheller JA stated in Carlenka, referring to the trial judge's findings, that (at 335-6): Brownie J ordered rectification as asked. His Honour found that Mr Greinert, who, he said, for practical purposes seemed to have controlled entirely the affairs of Carlenka, instructed Mr Scott, who in the practical sense was Carlenka's solicitor, to prepare the relevant documents so as to achieve a particular result, namely, to obtain a perfectly legitimate taxation advantage by arranging for a corporation to be beneficiary of the trust as to the income from that trust. By inadvertence, the deed of 26 June 1990 achieved not only the result intended but also a second result which was quite unintended, namely, that the corporation in question became a capital beneficiary as well as an income beneficiary. Recognising the caution with which courts act in ordering rectification, his Honour concluded that it would be quite wrong to hold that it was necessary for there to be contemporary written documents to corroborate the affidavits filed. The three deponents, Mr Greinert, Mr Charlton and the solicitor, Mr Scott, had not been cross-examined and there was at least one contemporary document in evidence which generally supported Carlenka's case. This it seemed to his Honour was all that could reasonably be asked for. 112 The parallels between that passage and the present case are readily apparent – Vanderkley, who was the governing mind of Project Musketeer (see [25] above), instructed Davies to prepare the 7024 Form so as to achieve a particular result, namely, to obtain a legitimate taxation advantage by arranging for the GECFAsia MEC Group to form on 1 July 2003, and for GEMIH and GEMICO to join that MEC group on 10 November 2003. By inadvertence (see [5] and [51] above), the Form 7024 achieved the first result, in that the GECFAsia MEC Group formed, but also the unintended result that GEMIH and GEMICO were excluded from the group. Importantly, evidence in the present case was stronger than that in Carlenka. Here, both Davies and Vanderkley were cross-examined, their intention that GEMIH and GEMICO would join the GECFAsia MEC Group from incorporation was unchallenged, there were numerous contemporary documents in evidence which "generally supported" the applicants' case (see [96] above) and, no less importantly, it was practically impossible for GEMIH and GEMICO to join that group when they did not exist. 113 The respondent submitted that the relevant intention was that of the boards of GEFCAsia, GECA and GEMIH, which each passed resolutions for the formation of the GEFCAsia MEC Group: see [47] above. That submission is based on the premise that the boards, not Vanderkley, had the power to make the consolidation decisions. That premise is incorrect: see [66] above. It is therefore immaterial that no directors other than Vanderkley were called to give evidence, and it is unnecessary for me to decide whether the other directors' intentions, as reflected in the board resolutions, were inconsistent with the rectification case. 114 The respondent further submitted that that even if the relevant intention was that of Vanderkley, the applicants have not established with "clear and convincing" evidence that his intention was that GEMIH and GEMICO would become members of the GECFAsia MEC Group with effect from 10 November 2003. I have already concluded that Vanderkley made the "choice" for GEMIH and GEMICO to join the GECFAsia MEG Group on 10 November 2003. This submission fails for the same reasons. Is the mistake rectifiable? 115 The respondent submitted that if the 7024 Form was rectified as sought, the 7024 Form would be internally inconsistent as between Part 3 and Part 5. Furthermore, the respondent submitted the 7024 Form, as rectified, would fail to give effect to Vanderkley's alleged intention as GEMIH and GEMICO would still be in Part 3 but should have been in Part 4. Under the old law, there would be a real question of whether the 7024 Form, once rectified, would constitute an "approved form" for the purposes of s 719-5(4), and if not, whether rectification would therefore be futile. These questions do not arise under the current law. If (contrary to the views I have earlier formed) the missing ingredient for the purposes of the "choice in writing" requirement under s 719-5(4) of the current law is written specification of when GEMIH and GEMICO joined the GECFAsia MEC Group, rectification as sought supplies that missing ingredient. 116 There is one final consideration – was the mistake a mistake capable of rectification? This question was considered in Gibbon v Mitchell [1990] 3 All ER 338. Millett J stated at 343 that: … wherever there is a voluntary transaction by which one party intends to confer a bounty on another, the deed will be set aside if the court is satisfied that the disponer did not intend the transaction to have the effect which it did. It will be set aside for mistake whether the mistake is a mistake of law or of fact so long as the mistake is as to the effect of the transaction itself and not merely as to its consequences or the advantages to be gained by entering into it. The proposition that equity will never relieve against mistakes of law is clearly too widely stated. (Citations omitted). 117 The "usual type" of mistake capable of rectification involves incorrectly recording the intention of the maker of a document. Such a mistake may be rectified by inserting words or deleting words, or substituting different words because the words that are there have the wrong meaning: see Allnutt v Wilding [2007] EWCA Civ 412 at [12]; Butlin's Settlement Trusts at 260. This is such a case. Vanderkley was not mistaken as to the consequences or tax advantages which would arise out of forming a MEC group and notifying the respondent via the 7024 Form. He was mistaken as to the legal effect of the 7024 Form. He mistakenly believed that the 7024 Form as submitted to the respondent would result in certain tax advantages, but because of the omission of the date, it failed to have that effect. 118 In the circumstances, I am satisfied that the omission of the words "10 November 2003" in Part 3 of the 7024 Form next to the words "[i]f joined after date of consolidation, give date joined the group", in the sections dealing with GEMIH and GEMICO, is a mistake that the Court could and should rectify in the manner sought by the applicants. 119 Before leaving this issue, there is one final matter which should be noted. In Wills v Gibbs, Rimer J noted that the purpose of the claim was to achieve a tax advantage. His Honour stated that that was not, of itself, a bar to a rectification order, but that in accordance with Racal Group Services v Ashmore [1995] STC 1151 at 1157, the Court would not order rectification if the only effect would be to secure a fiscal benefit, and the rights of the parties would be unaffected. The Court had to be satisfied that there was an issue, capable of being contested, between the parties. Here that was not in issue. The respondent accepted that this case affects the parties' rights. (iv) Other matters 120 Before turning to the question of relief, it is necessary to say something further about some other issues. As will be apparent, much of the analysis has centered around whether GEMIH (rather that GEMIH and GEMICO) joined the GECFAsia MEC Group on 10 November 2003. The reason for that is GEMICO was a wholly owned subsidiary of GEMIH (see [2] and [3] above) and a MEC group will automatically include Australian resident wholly owned subsidiaries of eligible tier-1 companies: s 719-10. Put another way, GEMICO's position in relation to the GECFAsia MEC group is dependent upon GEMIH's position. 121 Secondly, the consolidations regime was and remains complicated. The respondent acknowledges that fact and, as evidenced by the 2010 Amending Act, Parliament sought to address some of those issues. Next, this case did not concern any allegation of recent invention – the applicants prepared the relevant income tax returns on the basis that GEMIH joined the GECFAsia MEC Group on 10 November 2003 and left on 25 May 2004. Finally, there was no Pt IVA issue in this case. The Commissioner did not make a Pt IVA determination. E. FORM OF RELIEF 122 As noted earlier, there are two proceedings. In the 39B Proceeding, it is appropriate to make the following declarations: 1. the GECFAsia MEC Group consolidated for the purposes of Div 719 of the 1997 Act with effect from 1 July 2003; 2. GECA and 29 listed companies became subsidiary members of the GECFAsia MEC Group with effect from 1 July 2003; and 3. GEMIH and GEMICO became members of the GECFAsia MEC Group with effect from 10 November 2003. Given the conclusions I have reached, the other relief sought is unnecessary. 123 In the Pt IVC proceeding, the Preliminary Question and its answer is: Qu: Whether GE Mortgage Insurance Holdings Pty Ltd (now called Genworth Financial Mortgage Insurance Holdings Pty Limited) and GE Mortgage Insurance Company Pty Ltd (now called Genworth Financial Mortgage Insurance Ltd) became members of GECFAsia's MEC group with effect from 10 November 2003 pursuant to s 719-5(4) of the 1997 Act as amended by the [2010 Amending Act]. Answer: Yes. 124 In each proceeding, the respondent will be ordered to pay the applicants' costs, such costs to be taxed in default of agreement. I certify that the preceding one hundred and twenty-four (124) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gordon . Associate: Dated: 28 July 2011