CITATION: Scarfo v Chief Commissioner of State Revenue [2010] NSWADT 288 DIVISION: Revenue Division APPLICANT Sam Scarfo PARTIES: RESPONDENT Chief Commissioner of State Revenue FILE NUMBER: 106051 HEARING DATES: 22 November 2010 SUBMISSIONS CLOSED: 22 November 2010 DATE OF DECISION: 2 December 2010 BEFORE: Block J - Judicial Member CATCHWORDS: Duty on a transfer – whether transfer in compliance with the contract –meaning of "compliance"- whether transferee must be named in the contract- consideration of the three relevant subsections of section 18- consideration of the case law LEGISLATION CITED : Duties Act 1997 Gardiner v Heading & Another 1928 Kings Bench Division 248 Salim v Ingham Enterprises Pty Ltd 1998 NSWSC 23 Lake Victoria and Others v Commissioner of Stamp Duties (1949) 49 SR 262 Vickery v Woods (1952) 85 CLR 330 CASES CITED: Sharpe v Chief Commissioner of State Revenue [2002] NSWADT 6 Cooper Brookes (Wollongong) Pty Ltd v FCT (1981) 147 CLR 297 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Sportscorp Australia Pty Ltd v Chief Commissioner of State Revenue (2004) 58 ATR 1 Siu Yin Kwan v Eastern Insurance Co Ltd, [1994] 2 AC 199 at 207 (PC) APPLICANT T Thawley, barrister REPRESENTATION: RESPONDENT H El Hage, barrister ORDERS: The decision under review is set aside REASONS FOR DECISION Part A Preliminary and background 1 The decision under review is the disallowance of an objection against duty imposed on the transfer of real property in Bondi ("the property") by certain vendors (referred to in Exhibit AR1) to the Applicant. 2 The Tribunal had before it the documents lodged pursuant to section 58 of the Administrative Decisions Tribunal Act 1997. The Tribunal also admitted as Exhibit AR1 a Statement of Agreed Facts dated 22 November 2010 signed on behalf of the parties. It is in this particular context that the parties were of the view (and correctly in my opinion) that there was no need for oral evidence. Exhibit AR1 reads in full (but without its attachments) as follows: 1 On 24 November 2009, Stephen Charles Stone attended an auction of a property at 20 Fletcher Street, Bondi for and on behalf of Mr Sam Scarfo. 2 After successfully bidding at the auction, Stephen Charles Stone executed a Contract for Sale of Land in respect of the property. The vendors were Laura Gomez and Monico De Silva ("the Vendors"). The purchase price was $1,333,700.00. 3 Mr Stone paid the 5% deposit (namely $66,685) under the Contract. He was reimbursed that amount as follows: (a) as to $64,600 by electronic funds transfer on 27 November 2009 from an account in the name of Scarfo Investments Pty Limited, (see Bank Statement annexed and marked "A", a company associated with the Applicant (see company search annexed and marked "B"), and (b) as to the remainder, by way of cash from the Applicant to Mr Stone on 27 November 2009. 4 On 22 January 2010, Mr Stone executed a direction to the Vendors to prepare the Transfer in the name of the Applicant and executed a Statutory Declaration in which he indicated that he attended the auction for and on behalf of Mr Sam Scarfo. 5 On 16 February 2010: (a) the Contract for the Sale of Land was stamped and duty was paid in the amount of $58,843.50; (b) the Transfer was stamped under Section 18(3) of the Duties Act 1997 and stamp duty on the Transfer was paid in the sum of $10.00; and (c) the sale of the property settled. 6 On 23 February 2010, the Office of State Revenue advised that an audit was being conducted. The solicitors for the Applicant provided requested information on the same day. 7 On 25 February 2010, the Chief Commissioner wrote to the Applicant's solicitors and advised them that the Transfer did not fall within Section 18(3) of the Duties Act and issued the assessment the subject of this application, in the name of the Applicant requiring the payment of $58,843.50. 8 On 20 April 2010, the Applicant's solicitors lodged an objection to the assessment on behalf of the Applicant. 9 On 1 June 2010, the Chief Commissioner disallowed the Applicant's objection. 10 On 16 July 2010, the Applicant filed the Application for Review seeking a review of the Chief Commissioner's decision to assess him as being liable for payment of duty with respect to the Transfer. 3 The content of Exhibit AR1 must be considered in the context of certain documents included in Tabs 3 and 5 of the Section 58 documents and which are referred to hereafter in this part A. 4 The Applicant in his notice of objection (contained in Tab 5 and referred to as "the objection") dated 20 April 2010 relied only on section 18(3) of the Duties Act 1997 ("the Act"); his objection reads as follows: We hereby object on the following grounds: As a result of the Commissioner not raising any objection with respect to section 18(3)(a) (b) and (c), we have not made any lengthy submission in relation to those sub-paragraphs and have limited the submissions to application of section 18(3)(d) of the Act. We note section 18(3) provides as follows- "The duty chargeable in respect of a transfer of dutiable property that is not made in conformity with an agreement for the sale or transfer of the dutiable property is $10 (a)The duty chargeable in respect of the agreement has been paid, and (b)The transfer would be in conformity with the agreement if the transferee was the purchaser under the agreement, and (c )The transfer occurs at the same time as, or proximately with, the completion or settlement of the agreement, and (d)At the time the agreement was entered into, and at the completion or settlement of the agreement: (i)the purchaser under the agreement and the transferee under the transfer are related persons, except as provided by subparagraph (it); or (ii) if the purchaser purchased as a trustee, the transferee and the beneficiary are related persons". It is submitted that 18(3) (a) (b) and (c) of the Act have been satisfied. In relation 18(3) (d), we submit that the relevant subclause is 18(3) (d) (i) that am that the purchaser under the agreement and the transferee under the transfer are related persons. It is submitted that subparagraph (ii) does not apply as Mr Stone did not purchase the property, that is, he did not take the matter to completion as a result of Mr Scarfo stepping in to complete the purchase. In the Definitions of the Act, "related persons" is defined as- "a person who is related to another person in accordance with any of the following provisions: (a)natural persons are related persons if... (b)companies are related persons if... (c )a natural person and a private company are related persons if.. (d)a natural person and a trustee are related persons if the natural person is a beneficiary of the trust (not being a public unit trust scheme) of which the trustee is a trustee, (e) a private company and a trustee are related persons if..." As Mr Stone, in his Statutory Declaration dated 22 January 2010 clearly points out, he attended the Auction for and on behalf of Mr Scarfo. He has further indicated that he was provided deposit monies from Mr Scarfo. We can confirm that the 10% deposit was provided to Mr. Stone prior to the Auction in the event that he was successful. The trust was therefore created between Mr Stone as trustee and Mr Scarfo as beneficiary at the time Mr Scarfo gave the funds to Mr Stone to attend an Auction to bid on his behalf. Therefore, at the time the agreement was entered into, Mr Scarfo and Mr Stone were related persons as trustee and beneficiary. It is not necessary that the trust be outlined in a Trust Deed or any written instrument as it is a verbal trust between the parties. Therefore, it is submitted that Mr Stone as purchaser under the agreement acted in the capacity of trustee and whether or not such capacity was disclosed on the face of the agreement, it is the trustee capacity category of the purchaser under the related person definition which has been satisfied for the purposes of section 18(3)(d)(i) of the Duties Act. There is no dispute and clearly on the face of the Statutory Declaration provided, Mr Scarfo is clearly the beneficiary of the trust. The other requirement is that at completion or settlement the parties are related persons. Mr Stone and Mr Scarfo remain related persons as the trust was not extinguished until after completion had been affected. Accordingly, it is submitted that the decision of the Chief Commissioner insofar as Mr Scarfo having to pay double duty should be reversed and the sum of $58,843.50 refunded to Mr Scarfo along with any interest. We look forward to your favourable determination. 5 Tab 3 of the section 58 documents contains a statutory declaration ("the statutory declaration") dated 22 January 2010 by Mr Stephen Charles Stone (:Stone") which reads as follows; 1 I am named as the Purchaser on a Contract for the Sale of Land dated 24 November 2009 (hereinafter referred to as "the Contract) with Laura Gomez & Monica Da Silva as Vendors of the Property situated at 20 Fletcher Street, Bondi being Folio Identifier 2/304179 (hereinafter referred to as "the Property"). A copy of the front page of the Contract is annexed and marked "A". 2 I attended the auction of the Property 01124 November 2009 for and on behalf of Sam Scarfo. 3 I was the successful bidder at the auction. 4 At the time I was required to provide the Real Estate agent with details of the Purchaser, I failed to advise the agent that I was bidding for and on behalf of Sam Scarfo and that the Contract should have been entered into as Stephen Charles Stone as trustee for Sam Scarfo. 5 As a result, I incorrectly executed the Contract in my own right without any reference to me being the trustee for Sam Scarfo. 6I provided the Vendor a Direction in accordance with clause 4.3 of the Contract at the time the Transfer was submitted that identified Sam Scarfo as the true and correct Transferee, copy of that Direction is annexed and marked "B". 7 The 5% deposit was paid by Sam Scarfo who is shown on the Transfer as the Transferee. 6 Tab 3 of the Section 58 documents also includes a direction by Stone dated 20 January 2010 and reading as follows: I, STEPHEN CHARLES STONE, of 7/57-59 Beach Road, Bondi, hereby direct and authorise the Transfer to be prepared in the name of SAM SCARFO as Transferee notwithstanding the Contract dated 24 November 2009 with respect to the purchase of the above Property is in my name. 7 The content of the statutory declaration is in certain respects incorrect; this is so in particular in that, as appears from Exhibit AR1 the Applicant did not in fact when the agreement of sale ("the Contract") was executed pay the deposit. It was in fact (as set out in Exhibit AR!)paid by Stone who subsequently received refunds amounting in aggregate to the deposit. 8 In his objection the Applicant relied, as set out previously, on section 18(3) of the Act; at the hearing the Applicant noted that he intended to rely firstly on section 18(2) of the Act, secondly on section 18(3) of the Act and lastly on section 18(1) of the Act. The Applicant is not, having regard to section 100(2,) of the Taxation Administration Act confined to the grounds stated in his objection. The Tribunal intends, in case it can be contended that it has erred in relation to any of the three grounds, and in the interests of completeness, to deal with all of such contentions. 9 In respect of the facts and having regard to the content of this Part A there can be no doubt as to the fact that the when Stone attended the auction of the property he did so as agent for and on behalf of the Applicant and thus as agent for an undisclosed principal. That this is so is clear having regard to clause 1 of exhibit AR1. 10 The grounds set out in the objection are also incorrect in a number of relevant respects. Stone was not provided with any moneys by the Applicant prior to the auction and execution of the Contract. There was no trust at that time as between Stone as trustee and the Applicant as beneficiary and this is so in particular because there was at the time of the auction and the exaction of the Contract no trust property. The Applicant cannot therefore be heard to contend that in executing the Contract he did so as trustee of a trust of which the Applicant was the beneficiary. 11 At the same time and notwithstanding the inaccuracies (in the statutory declaration and the objection referred to previously in these reasons it cannot be doubted that having regard to clause 1 of Exhibit AR! Stone attended the auction and executed the Contract as agent for the Applicant as his undisclosed principal. . Stone's statement that he executed the Contract "in my own right" and without any reference to "my being trustee for Sam Scarfo should be read in the context of the statutory declaration as a whole and so that the words "in my own right" must be read on the basis that Stone did not at the time when he entered into the Contract disclose the existence of his principal. This does not alter the fact that it is common cause between the parties that he was acting as agent of an undisclosed principal. The reference in the statutory declaration to the existence of a trust was incorrect for reasons set out previously Part B Agent for an undisclosed principal 12 In Gardiner v Heading & Another 1928 Kings Bench Division 248 Scrutton LJ said at page 290: If a party makes a contract in his own name and the other party, the promisee, finds that the promisor has an undisclosed principal, although he never knew of him and therefore could never have given credit to him, yet he may sue him because he has in fact made a contract with him. But if a man who contracts with another thinking he is a principal, may, on finding he is in truth an agent sue the real principal, why should not the reverse hold good also? Why should not a man who contracts with another, thinking he is an agent sue him when he finds out that he is not the real principal? 13 ..The statement by Lord Justice Scrutton referred to in the preceding clause was referred to with approval in Salim v Ingham Enterprises Pty Ltd 1998 NSWSC 23; in para 29 the Court of Appeal referred to that statement in terms and in para 30 said; 'It is patent that an undisclosed principal may be sued upon a contract even though his existence might not have been disclosed. 14 The Tribunal refers also in this context to a passage from Dal Pont, Law of Agency, 1st Ed, Butterworths (2001) as follows: A leading modern statement of the relevant law is that of Lord Lloyd in Siu Yin Kwan v Eastern Insurance Co Ltd , [1994] 2 AC 199 at 207 (PC). who said: (1) An undisclosed principal may sue and be sued on a contract made by an agent on his behalf, acting within the scope of his actual authority. (2) In entering into the contract, the agent must intend to act on the principal's behalf. (3) The agent of an undisclosed principal may also sue and be sued on the contract. (4) Any defence which the third party may have against the agent is available against his principal. (5) The terms of the contract may, expressly or by implication, exclude the principal's right to sue, and his liability to be sued. The contract itself, or the circumstances surrounding the contract, may show that the agent is the true and only principal. 15 The law as to an agency for an undisclosed principal is clear. The other party to the contact is entitled to enforce the contract against the principal. . If he does not know of the existence of the principal he is entitled so claim against the agent who can in such event join the undisclosed principal and seek an indemnity against him. In this case, and as I have noted, there is no doubt as to the fact that Stone entered into the Contract as agent on behalf of the Applicant who was his undisclosed principal. There is nothing in the evidence before the Tribunal (and even though some of the factual material is incorrect) which has any different effect. Part C the legislation 16 Section 18 of the Act (which is headed 'no double duty")reads as follows: 18 No double duty (1)If a dutiable transaction is effected by more than one instrument, one instrument is to be stamped with the duty payable on the dutiable transaction and each other instrument is chargeable with duty of $50. Note. Instrument includes a written statement. (2) The duty chargeable in respect of a transfer of dutiable property made in conformity with an agreement for the sale or transfer of the dutiable property is $10 if the duty chargeable in respect of the agreement has been paid. (3) The duty chargeable in respect of a transfer of dutiable property that is not made in conformity with an agreement for the sale or transfer of the dutiable property is $10 if: (a) the duty chargeable in respect of the agreement has been paid, and (b) the transfer would be in conformity with the agreement if the transferee was the purchaser under the agreement, and (c) the transfer occurs at the same time as, or proximately with, the completion or settlement of the agreement, and (d) at the time the agreement was entered into, and at the completion or settlement of the agreement: (i) the purchaser under the agreement and the transferee under the transfer are related persons, except as provided by subparagraph (ii), or (ii) if the purchaser purchased as a trustee, the transferee and the beneficiary are related persons. (4) The duty chargeable on a transfer to a trustee of dutiable property subject to a declaration of trust is $10 if ad valorem duty has been paid on the declaration of trust in respect of the same dutiable property. ....... 17 The expression "related person" is defined in the Dictionary to the Act as follows: related person means a person who is related to another person in accordance with any of the following provisions: (a) natural persons are related persons if: (i) one is the spouse or de facto partner of the other, or (ii) the relationship between them is that of parent and child, brothers, sisters, or brother and sister, (b) companies are related persons if they are related bodies corporate. (c) a natural person and a private company are related persons if the natural person is a majority shareholder or director of the company or of another private company that is a related body corporate, (d) a natural person and a trustee are related persons if the natural person is a beneficiary of the trust (not being a public unit trust scheme) of which the trustee is a trustee, (e) a private company and a trustee are related persons if the company, or a majority shareholder or director of the company, is a beneficiary of the trust (not being a public unit trust scheme) of which the trustee is a trustee. 18. The Tribunal notes that it was furnished with helpful written submissions by the parties and referred to as "AS" in respect of the Applicant's submissions and "RS" in respect of the Respondent's submissions. Part D Section 18(1) 18 Clauses 17 and 18 of AS read as follows: 17.Secondly, if s 18(2) does not apply, s 18(1) does. It provides: 18(1) If a dutiable transaction is effected by more than one instrument, one instrument is to be stamped with the duty payable on the dutiable transaction and each other instrument is chargeable with duty of $50. 18This was clearly a case in which one dutiable transaction was effected by more than one instrument. Section 18(2) applies in preference to s 18(1) by reason of the general principle that if two heads of charge are applicable, but one is more closely applicable than the other, then the more appropriate head will be chosen. However, if s 18(2) does not apply, s 18(1) clearly does. 19 Clauses 22 and 23 of RS read as follows: 22The assertions at [17]-[18] of the Applicant's Submissions are not to the point. Clearly, s. 18(1) did not apply in this case. That section applies to " a dutiable transaction", ie a single dutiable transaction. 23There were two "dutiable transactions" in this case. The first was the Contract: see s. 8(1)(b)(i). The second was the Subject Transfer: s. 8(1)(a). Both transactions were liable for ad valorem duty unless, for example, s. 18(2) or (3) applied. 20 In respect of this particular contention the Respondent is in my view correct. There were indeed on a prima facie basis two dutiable transactions; the first is the Contract and the second is the transfer. Each is dutiable unless it comes within one of the exempting subsections of section 18. Section 18 is applicable in respect of a single transaction encapsulated in more documents than one. This is not such a case and the Applicant must fail under this head Part E Section 18(3) 21 It is common cause between the parties that in relation to section 18(3) of the Act each of paragraphs (a) (b) and (c) is satisfied. Paragraph (d) requires (disjunctively) that either of subparagraphs (i) or (ii) be satisfied. Subparagraph (i) applies unless subparagraph (ii) does; this is so having regard to the words commencing with "except" in subparagraph (i) 22 Subparagraph (ii) applies if the purchaser purchased as a trustee and the transferee and the beneficiary are related persons. There are two reasons why this cannot be so. Stone did not purchase as a trustee ,and in any event and even if there were a trust, the transferee and the beneficiary are one and the same person and cannot therefore be related 23 Subparagraph (i) cannot apply because Stone and the Applicant were not related persons as defined. 24 It follows that the Applicant cannot succeed under this head. Part F Section 18(2) 25 Lake Victoria and Others v Commissioner of Stamp Duties (1949) 49 SR 262 is generally regarded as one of the leading cases in this area. It was decided in relation to section 41 of the Stamp Duties Act 1920; section 41(4) (a) is for all relevant purposes in the same terms as section 18(2) of the Act. 26 . The following extract from page 265 of the judgment in Lake Victoria is of particular relevance: A conveyance is not made in conformity with the agreement, unless it is made to the purchaser, or if the agreement provides that it is to be made not to the purchaser but to some other person, to that other person. 27 It will be noted that in Lake Victoria it was important and relevant and the decision turned on the fact that the transferee was not at the time of the contract in existence. This was the position also in Vickery v Woods (1952) 85 CLR330. While Vickery and Woods accords with Lake Victoria the judgment (in Vickery and Woods) as to this aspect was obiter because the judgment proper turned on a question of cancellation of the relevant contract. 28 Focussing on the words used in Lake Victoria; it is clear that there are two possibilities; under the first alternative a conveyance is exempt if it is made in conformity with the contract, to the purchaser; in the alternative the contract can provide for a conveyance to another named person. The second alternative is not of course relevant in this case. On the basis that the applicable alternative for the purposes of this matter is the first it is then necessary to consider whether the transfer to the Applicant was made, in conformity with the contract, to the purchaser. Again there are two possible alternatives; under the first alternative there will not be compliance with section 18(2) unless it is made to the person named as the purchaser in the contract. The other alternative is there will be compliance when the transfer is made in favour of the purchaser, and notwithstanding the fact that his name does not appear in the contract. 29 The Tribunal was referred in particular to a decision of JM Seve in Sharpe v Chief Commissioner of State Revenue [2002] NSWADT 6. In considering that question JM Seve said at para 29 that "Each of Lake Victoria Ltd v Commissioner of Stamp Duties (supra) and Vickery v Woods (supra) are authority that for a transfer to be "in conformity" with an agreement, the transfer of the property must be made to the person identified in the agreement as the transferee of the subject property. 30 It will be noted then that Sharpe is authority for the proposition that a transfer cannot be in conformity with a contract unless it is made in favour of the transferee named in the contract. It is not clear to me that section 18(2) or the judgment in Lake Victoria go so far as to require that the transfer must of necessity for the purposes of the exemption be made in favour of a transferee identified in the contract. Section 18(2) could have been drawn in such manner that the exemption is available only where the transfer is made in favour of the person named in the contract; however the words "in conformity with" suggest that the intended meaning is wider. In this matter the Chief Commissioner has accepted that Stone was acting as agent for the Applicant who was thus an undisclosed principal, and thus, having regard to part B, the purchaser. The content of Part B establishes that an undisclosed principal can sue and be sued in respect of the contract. In this particular instance the contract was entered into by Stone but that does not alter the fact that the Applicant was the purchaser; the relevant transfer was made in favour of the purchaser and was thus (so it is contended by the Applicant) in compliance with the contract. It seems clear enough that a situation such as this was not put to the Tribunal in Sharpe. 31 In Cooper Brookes (Wollongong) Pty Ltd v FCT (1981) 147 CLR 297 at 320 the court said:: There are cases in which inconvenience of result or improbability of result assists the court in concluding that an alternative construction which is reasonably open is to be preferred to the literal meaning because the alternative interpretation more closely conforms to the legislative intent discernable from other provisions in the statute. 32 The proper approach to statutory construction was considered by the High Court in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355. McHugh, Gummow, Kirby and Hayne JJ said, relevantly: The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute [See Taylor v Public Service Board (NSW) (1976) 137 CLR 208 at 213, per Barwick CJ]. The meaning of the provision must be determined "by reference to the language of the instrument viewed as a whole" [ Cooper Brookes (Wollongong) Pty Ltd v FCT (1981) 147 CLR 297 at 320, per Mason and Wilson JJ. See also South West Water Authority v Rumble's [1985] AC 609 at 617, per Lord Scarman, "in the context of the legislation read as a whole"]. In Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390 at 397], Dixon CJ pointed out that "the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed". Thus, the process of construction must always begin by examining the context of the provision that is being construed [ Toronto Suburban Railway Co v Toronto Corporation [1915] AC 590 at 597; Minister for Lands (NSW) v Jeremias (1917) 23 CLR 322 at 332; K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 312, per Gibbs CJ; at 315, per Mason J; at 321, per Deane J] [69]. 33 It must always be remembered that the object of section 18 is to avoid double duty and indeed the section is so entitled. As Dixon J said: "the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed" 34 I have come to the conclusion that this is a case in which the correct and preferable decision requires (having regard to Cooper Brookes and Blue Sky) a finding in respect of this contention in favour of the Applicant. Part G. Summary postscript and conclusion 35 On 23 November 2011 the Chief Commissioner's counsel wrote to the Tribunal (with the consent of counsel for the Applicant) in order to draw the attention of the Tribunal to a judgment of Gzell J in Sportscorp Australia Pty Ltd v Chief Commissioner of State Revenue (2004) 58 ATR 1 said to be relevant for the consideration of this matter and a binding decision so far as the Tribunal is concerned.(That judgment was not cited at the hearing but the manner in which it was raised indicates that it is regarded by the Chief Commissioner as important and relevant and certainly the response by the Applicant indicates that it was treated and dealt with accordingly.) 36 In answer to that communication the Applicant's counsel dealt with the judgment at some length; in quoting a part of the response of the Applicant I have renumbered the content to some extent and have omitted some of the text, that edited response (of which I approve) reads as follows: 1 By letter from counsel for the respondent dated 23 November 2010, the Commissioner relies upon the decision in Sportscorp Australia Pty Ltd v Chief Commissioner of State Revenue (2004) 58 ATR 1 in support of his contention that s 18(2) of the Duties Act 1997 (NSW) does not relevantly apply in the present case. 2 It is necessary to appreciate the facts in Sportscorp . There are many, and significant, points of distinction. They do not all need to be referred to for present purposes. The question which arose in Sportscorp was different to the question in this case. 3 Further, the issue in this case was not addressed at all in Sportscorp , even by way of obiter dictum . 4In Sportscorp , three partners (the first three plaintiffs) appointed the fourth plaintiff (Queenscliff) agent to acquire and develop land. 5The terms of its agency were that it, Queenscliff, was to acquire legal title to the land and develop it before transferring something different (as will be seen) to the first to third plaintiffs. Queenscliff did not enter into the contract as agent for an undisclosed principal, thus creating a contract between the vendor and the undisclosed principal. Rather, Queenscliff was itself to acquire legal title to the land The land was in fact acquired by the Queenscliff and transferred to it As Gzell J noted in paragraph [12]: "The purchaser was Queenscliff." Unlike the present case, in Sportscorp there simply was no contractual relationship ever formed between the vendors and the first to third plaintiff. Accordingly, the finding of Gzell J, at [12] – that the only transfer in conformity with the agreement for sale was the transfer to Queenscliff – is wholly unremarkable and obviously correct. But it says nothing about what the situation would be in a case – such as the present – in which the contract for sale was formed between the vendor and an undisclosed principal. 6 The land – of which Queenscliff was the legal owner – was then developed by it. After it had been developed into residential accommodation by Queenscliff, it was divided into strata title lots and legal title in the lots was transferred from the Queenscliff to the first to third plaintiffs as tenants-in-common, who thereupon became legal owners of the strata titles. Those strata titles were not what had been acquired by the Queenscliff from the vendor. In particular, what was ultimately transferred by Queenscliff to the first to third defendants could not include the common property: at [44]. It may readily be seen that the case is quite different from the present. It was always intended that Queenscliff acquire the land and develop it. It was no person's intention that Queenscliff execute a contract for sale for the first to third plaintiff as undisclosed principal such that (a) a contract be formed between the vendor and the first to third plaintiffs (b) the transfer of the land by the vendor would be to the first to third plaintiffs. The intention was that Queenscliff acquire the land and that is what occurred. 7 Sportscorp is undoubtedly binding on the Tribunal as the respondent submits. But it does not resolve, nor even purport to resolve, the issue in the present case. Gzell J did not refer to, let alone consider, either Lake Victoria Ltd v Commissioner of Stamp Duties (1949) 49 SR(NSW) 262 or Vickery v Woods (1952) 85 CLR 336. The case before him was not one which involved a contract between a vendor and an undisclosed principal. Gzell J's observation in paragraph [12], made in the context of the factual circumstances in the case before him, that the first to third plaintiffs were not "revealed" in the contract for sale cannot reasonably or properly be construed as deciding, oxymoronically, that it is necessary to name an undisclosed principal in a contract in order for the subsequent transfer to be "in conformity" with the contract between a vendor and that undisclosed principal. The issue simply did not arise for consideration. Had it arisen, Gzell J would no doubt have referred to: (a)Lake Victoria Ltd v Commissioner of Stamp Duties (1949) 49 SR(NSW) 262 at 265 in which Jordan CJ said: "A conveyance is not made in conformity with the agreement, unless it is made to the purchaser, or if the agreement provides that it is to be made not to the purchaser but to some other person, to that other person". (b)Vickery v Woods (1952) 85 CLR 336 in which the judgment of Jordan CJ was endorsed by Dixon J at 343.9. (c ) the fact that neither Jordan CJ nor Dixon J, nor – most importantly – s 18(2) require any "identification" of the purchaser. Neither of them was dealing with the position of undisclosed principals. All they held was that if the transferee is not the purchaser, then it is sufficient if the intended transferee is disclosed in the contract. But in the case before the Tribunal the transferee is the purchaser. 37 It is my opinion that the law as to an agent for an undisclosed principal is such that the undisclosed principal is in fact in this particular situation the purchaser, and so that a transfer to the undisclosed principal does comply with section 18(2) In summary then my finding is that the Applicant does not succeed under either of section 18(1) or section 18(3) but he does succeed under section 18(2) .. 38 It follows that the decision under review must be set aside. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.