New South Wales Supreme Court CITATION : Eljon Pty Limited v The Chief Commissioner of State Revenue [1999] NSWSC 266 CURRENT JURISDICTION : Civil FILE NUMBER(S) : 30065/98 HEARING DATE(S) : 24 March 1999 JUDGMENT DATE : 1 April 1999 PARTIES : Eljon Pty Limited The Chief Commissioner of State Revenue JUDGMENT OF : Newman J COUNSEL : B R Pape (Plaintiff) Dr H R Sorensen (Defendant) SOLICITORS : Matthews Dooley & Gibson (Plaintiff) Crown Solicitor (Defendant) CATCHWORDS : Stamp duties; liability; rate payable; deed; declaration of trust; deed in escrow; Stamp Duties Act 1920 ACTS CITED : Income Tax Assessment Act 1936 Taxation Administration Act 1996 Commissioner of Stamp Duties (NSW) v Pendal Nominees Pty Ltd (1988-89) 167 CLR 1 at 16 DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 Alan Estates Ltd v W G Stores Ltd [1982] Ch 511 at 520 CASES CITED : Ansett Transport Industries (Operations) Pty Ltd v Comptroller of Stamps [1985] VR 70 at 79 Tooheys Limited & Ors v Commissioner of Stamp Duties (1961) 105 CLR 602 at 609 Toohey's Limited & ors v Commissioner of Stamp Duties [1960] SR (NSW) 539 at 545 Szajntop v Federal Commissioner of Taxation (1993) 42 FCR 318 at 327.9 DECISION : Judgment for Defendant THE SUPREME COURT OF NEW SOUTH WALES ADMINISTRATIVE LAW DIVISION NEWMAN J THURSDAY, 1 APRIL 1999 30065/98 - ELJON PTY LIMITED v THE CHIEF COMMISSIONER OF STATE REVENUE JUDGMENT 1 HIS HONOUR: This is an appeal against an assessment of stamp duty brought pursuant to s 124A of the Stamp Duties Act 1920 as amended (hereinafter referred to as the Act). 2 By its Notice of Objection the plaintiff claims that the defendant Commissioner erred: (a) in failing to understand that no property was settled by a putative "Trust Deed" of 27 October 1997; and (b) in finding that the properties were acquired under the terms of a putative Trust. 3 A preliminary point was taken by the defendant Commissioner that the principal ground of appeal urged on behalf of the plaintiff was not available to it because its subject matter was not raised by the plaintiff in its Notice of Objection. 4 In this regard the defendant argued that the issue raised in the ground of appeal was not the subject of any ground of the Notice of Objection. Accordingly it was put the appeal to this Court being limited by s 124A to the grounds of the original objection the matter was not capable of being raised in these proceedings. I shall return to this point later in these reasons. 5 The matter arises out of a joint venture in which three parties proposed to purchase three adjoining properties in Edward Street, Baulkham Hills, demolish them and build nine town houses for sale. The parties concerned were a Mr John McCabe (who is a director of the plaintiff company), a Mr Tony Macri and a company called Blairgrove Pty Limited. 6 As part of the process of managing the joint venture the three parties and the plaintiff company entered into an agreement which was entitled "Deed of Trust". The document so entitled bears the date 27 October 1997. It nominates the plaintiff company as the trustee and Messrs McCabe, Macri and Blairgrove Pty Limited as the first, second and third beneficiaries respectively. 7 The Deed is in the following terms: "DEED OF TRUST THIS DEED made the 27th day of October 1997 BETWEEN: ELJON PTY LIMITED CAN 060 690 717 of 5 Lisbon Court, Castle Hill in the State of New South Wales (hereinafter called 'the Trustee') on the first part AND JOHN MCCABE of 5 Lisbon Court, Castle Hill in the said State (hereinafter called 'the First Beneficiary') of the second part AND TONY MACRI of 2 Stephen Street, Hornsby in the said State (hereinafter called 'the Second Beneficiary') of the third part AND BLAIRGROVE PTY LIMITED CAN 073 374 437 of 128 Great North Road, Five Dock in the said State (hereinafter called 'the Third Beneficiary') of the fourth part WHEREAS A. The Trustee has purchased the whole of the properties contained in Folio 6E/406520, 5/23686 and 4/23686 situate at 32-36 Edward Street, Baulkham Hills (hereinafter called 'the property'); and B. The First, Second and Third Beneficiaries have paid all of the purchase price of the property together with all costs and disbursements relating to the purchase thereof; and C. The beneficial owner of the property at the time of the purchase was the First, Second and Third Beneficiaries as tenants in common in equal shares. NOW THIS DEED WITNESSES AS FOLLOWS:- 1. The Trustee hereby declares that it holds the property on Trust for the First, Second and Third Beneficiaries as tenants in common in equal shares. 2. The First, Second and Third Beneficiaries jointly and severally indemnify the Trustee in respect of all suits, claims and demands in respect of the Trustee's purchase, ownership and sale of the property excepting only the Trustee's liability to each of the beneficiaries as a Trustee. IN WITNESS WHEREOF the parties hereto have hereunto set their hands and affixed their seals on the day and year first hereinbefore written." 8 The document then contains the common seals of Eljon Pty Limited and Blairgrove Holdings Pty Limited which are duly affixed and the witness signatures of Messrs McCabe and Macri. 9 As of 27 October 1997 no purchase of the properties nominated in the document entitled "Deed of Trust" had been completed. Nor indeed had the first, second and third beneficiaries paid any part of the purchase price or any costs and disbursements relating to those purchases. It thus follows (and about this there was no issue) that the first, second and third beneficiaries were not beneficial owners as at 27 October 1997. 10 The fact was that on 27 October 1997 a contract for the purchase of the premises known as 32 Edward Street were exchanged. The evidence does not reveal whether or not that exchange happened before the document entitled "Deed of Trust" was sealed and signed by the parties to it. Contracts for the purchase of 34 and 36 Edward Street were not exchanged until 5 November 1997. 11 The purchase of 32 Edward Street was completed on 8 January 1998. The purchase of 36 Edward Street on 6 April 1998 and that of 34 Edward Street on 8 May 1998. 12 For the purposes of this appeal the defendant Commissioner conceded that all monies payable by the beneficiaries for the purchase of the subject properties were in fact paid by 8 May 1998. The concession was made only for the purposes of this appeal, it being made plain that should this in fact not be so the defendant Commissioner would not be estopped from dealing with the matter otherwise should the need arise. 13 The Commissioner assessed duty on the document entitled "Trust Deed" under para (2)(a) under the heading "Declaration of Trust" found in the Second Schedule to the Act. The duty levied under this paragraph amounted to $26,315. 14 It was the plaintiff's contention that in fact duty should have been levied under para (1) under that heading in the Second Schedule which would have resulted in the amount of duty payable being $10.00. 15 Paragraph (2)(a) is in the following terms: Nature of Instrument Amount of Duty Persons primarily liable DECLARATION OF TRUST (2)(a) Any instrument declaring that any property vested or to be vested in the person executing the instrument is or shall be held in trust for the person or persons or purpose or purposes mentioned therein notwithstanding that the beneficial owner or person entitled to appoint that property may not have joined therein or assented thereto. 200.00 or the same duty as would be chargeable if the instrument were a conveyance of the property comprised therein, whichever is the greater. The person declaring the trust or the person directing the declaration of the trust. Paragraph (1) is as follows: (1) Any instrument declaring that a person in whom property is vested as the apparent purchaser thereof holds the same in trust for the person or persons who have actually paid the purchase money therefor. 10.00 The person declaring the trust. 16 In determining that the duty payable was to be calculated pursuant to para (2)(a) and not para (1) the defendant Commissioner ruled that para (1) only applied to declarations of (a resulting) trust over property at the time of execution of the declaration of trust, is already vested in the trustee. 17 In so doing the defendant relied upon what had fallen from the High Court in Commissioner of Stamp Duties (NSW) v Pendal Nominees Pty Ltd & Anor (1988-89) 167 CLR 1 at 16. There Mason CJ observed that the language of para (1) was unmistakably different to that used in para (2)(a). He went on to say: "In particular, the words "or to be vested" which appear in the latter paragraph are absent from the former. The history of these provisions reveals that these words were specifically added to par (2)(a) but that the legislature did not see fit to insert them in par (1). A clear distinction was thus made and persuasive reasons would be needed to imply the presence in para (1) of words which appear to have been consciously excluded." 18 The exclusion Mason CJ was referring to was the exclusion by the legislature. 19 The plaintiff's prime contention was that the defendant Commissioner erred in concluding the duty payable on the instrument under the provisions of para (2)(a) and should in fact have assessed the duty payable under para (1) that is in the sum of $10 rather than $26,315. 20 Its argument was that the document was entitled Deed of Trust and was held as an escrow upon the completion of the purchase of properties and thus inoperative from the date it bore, 27 October 1997 until 8 May 1998 when the settlement of the conveyance of the last of the properties involved was completed. 21 The argument commenced with a reference to a statement made by Mason J (as he then was) in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431: "… liability of an instrument to stamp duty is to be ascertained by reference to the circumstances which exist when the instrument is executed… ." 22 Reliance was also placed upon what fell from Brennan J (as he then was) to like effect at p 470 in the same case. 23 The argument continued that the document was not first executed for the purposes of s 38(1) of the Act in accordance with the definition given to execution of documents under s 26 because it was put that it was not executed within the meaning given by s 3(1) of the Act. 24 Section 38(1) is in the following terms: "38.(1) Every person primarily liable with respect to any instrument or matter of the nature mentioned in this Act is personally liable to the Crown for the payment of the duty so chargeable on such instrument immediately upon the first execution thereof, and every such person may be sued for the amount of such duty as for a debt due to the Crown." 25 Section 26 is in the following terms: "26. For the purposes of this Act an instrument is deemed to be first executed the first time that it is signed and sealed, or signed (as the case may be) by any party thereto: 26 The definition in s 3(1) is as follows: " 'Executed,' with reference to instruments under seal, means signed and sealed, and with reference to instruments not under seal means signed." 27 One difficulty which emerges in dealing with this particular aspect of the argument advanced is that the limitation imposed by the general rule adverted to by Mason J was excepted by him when construing para (2). 28 Para (2) as it then appeared in the Second Schedule at the time of the delivery of the decision in DKLR Holding (No 2) is in the same terms as the present para (2)(a). What Mason J said was this: "The general rule is that the liability of an instrument to stamp duty is to be ascertained by reference to the circumstances which exist when the instrument is executed, though the court can have regard to subsequent events in order to discover the true position as the time of execution (Wm Cory & Son Ltd, [1965] AC at p 1105, per Lord Reid). In other circumstances the general rule might require us to narrow the category of instruments falling within par (2), confining it to declarations effective on their execution to create trusts. But the express references in par (2) of the statutory description to property 'to be vested' and which 'shall be held' make it clear that the operation of the paragraph cannot be so limited." 29 I shall return to this aspect later in these reasons. The plaintiff rightly contended that while all deeds are instruments under seal, not all instruments under seal are deeds. 30 Again, rightly the plaintiff submitted that to be validly executed a deed is required to be signed, sealed and delivered for the purposes of the common law. 31 It was argued that as the document was an escrow it was not delivered under 8 May 1998. The concept of a delivery of a deed at common law has been dealt with in a number of authorities. Blackburn J in Xenos v Wickham (1867) LR 2 HL 296 at 312 said: "… no particular technical form of words or acts is necessary to render an instrument the deed of the party sealing it. The mere affixing of the seal does not render it a deed; but as soon as there are acts or words sufficient to show that it is intended by the party to be executed as his deed presently binding on him, it is sufficient. The most apt and expressive mode of indicating such an intention is to hand it over, saying: 'I deliver this as my deed;' but any other words or acts that sufficiently show that it was intended to be finally executed will do as well. And it is clear on the authorities, as well as the reason of the thing, that the deed is binding on the obligor before it comes into the custody of the obligee, nay, before he even knows of it; though, of course, if he has not previously assented to the making of the deed, the obligee may refuse it." 32 Lord Denning M R in Vincent v Premo Enterprises (Voucher Sales) Ltd [1969] 2 QB 609 at 619 observed as follows: " 'Delivery' in this connection does not mean 'handed over' to the other side. It means delivered in the old legal sense, namely, an act done so as to evince an intention to be bound. Even though the deed remains in the possession of the maker, or of his solicitor, he is bound by it if he has done some act evincing an intention to be bound, as by saying: 'I deliver this my act and deed.' He may, however, make the 'delivery' conditional: in which case the deed is called an 'escrow' which becomes binding when the condition is fulfilled." 33 As Lord Denning stated in Alan Estates Ltd v W G Stores Ltd & Anor [1982] Ch 511 at 520, the doctrine of escrow is a relic of mediaeval times. In essence it means the document is in suspense. See Watkins v Nash 44 LJ Ch 505. That is to say the operation of a deed when in escrow is suspended until the conditions of the suspense are fulfilled. 34 In Alan Estates Ltd , Lord Denning put the matter this way at 520: "… what is the effect of an escrow before the conditions are fulfilled? One thing is clear. Whilst the conditions are in suspense, the maker of the escrow cannot recall it. He cannot dispose of the land or mortgage it in derogation of the grant which he has made. He is bound to adhere to the grant for a reasonable time so as to see whether the conditions are to be fulfilled or not. If the conditions are not fulfilled at all, or not fulfilled within a reasonable time, he can renounce it. On his doing so, the transaction fails altogether. It has no effect at all. But if the conditions are fulfilled within a reasonable time, then the conveyance or other disposition is binding on him absolutely. It becomes effective to pass the title to the land or other interest in the land from the grantor to the grantee. The title is then said to 'relate back' to the time when the document was executed and delivered as an escrow. But this only means that no further deed or act is necessary in order to perfect the title of the grantee. As between grantor and grantee, it must be regarded as a valid transaction which was effective to pass the title to the grantee as at the date of escrow: see Perryman's Case (1599) 5 Co Rep 84a." 35 In the same case Sir Denys Buckley, sitting as a member of the Court of Appeal at 528, stated: "When the conditions of an escrow are fully satisfied, so that it becomes an immediately operative deed, that effect relates back to the date of its delivery in escrow, but not for all purposes - only for such purposes as are necessary to give effect to the transaction (Security Trust Co v Royal Bank of Canada [1976] AC 503, 517 per Lord Cross of Chelsea), which I take to mean all the terms and provisions of the instrument which remain capable of being given effect to implement the bargain between the parties." 36 Ackner LJ at 524 expressed a dissenting view. The plaintiff argued that despite what had fallen from the Court of Appeal in Alan Estates Ltd the better view was that the deed bearing date 27 October 1997 did not become operative until 8 May 1998 because it only served to record or confirm an implied or resulting trust as an expressed trust. It would thus be incorrect to infer that it had a retroactive effect to 27 October 1997. 37 Accordingly it was argued that the Deed of Trust did not satisfy the criterion of being first executed as of 27 October 1997 in accordance with the meaning given to "execution" by s 38(1), s 26 and the definition found in s 3(1) of the Act. Thus as of 27 October 1997, so the argument ran, the Deed of Trust was inoperative for all purposes. 38 It was sought to distinguish Commissioner of Stamp Duties NSW v Pendal Nominees Pty Ltd because it was put the Deed in the present case was, as has already been mentioned, first executed as an escrow. 39 This argument, in my view, appears to founder for a number of reasons. (1) As I have indicated above the limitation upon which the plaintiff relies as expressed by Mason J in DKLR Holding (No 2) was expressed by that judge in relation to the verbiage of the very paragraph of the Second Schedule with which the court is dealing here. (2) Not only does the submission that the "Deed became operative on 8 May 1998" appear to be contradicted by what fell from Lord Denning and Sir Denys Buckley in Alan Estates Ltd but also a clear expression of principal by Tadgell J in Ansett Transport Industries (Operations) Pty Ltd v Comptroller of Stamps [1985] VR 70 at 79. There Tadgell J, having found that the instrument in question was in fact delivered in escrow went on to observe as follows: "All these contingencies, however, happened; and they had happened at the time the instrument was assessed to stamp duty. The burden of the authorities is that, when the conditions of an escrow are satisfied, so that it becomes an immediately operative deed, it takes effect as between the parties to it as from its delivery in escrow. " He then referred to a number of authorities including Alan Estates Ltd . (3) Liability for duty under the Act depends solely on whether the instrument responds to the description in para (2)(a) "as at the time of first execution". See Nichols Cabramatta Wholesale Stationery Supplies Pty Ltd v Commissioner of Stamp Duties NSW (1993) 93 ATC 4647 at 4651. (4) The preamble to the definition section of the Act s 3(1) commences "In this Act, unless the context or subject matter otherwise indicates or requires:" which plainly refers to "context or subject matter" meaning not the context or subject matter of an instrument but of the relevant provisions "in this Act". (5) There is nothing in para (2)(a) of the Second Schedule which requires that an instrument needs anything more than being signed or sealed. Ex facie, a deed, which is unarguably an instrument for the purposes of the Act is liable to duty immediately on signing and sealing without reference to delivery. See Hill Stamp Duties para 1.80 and the terms of s 26 of the Act. (6) Even if the document entitled "Deed of Trust" had no legal operation, the authorities make it clear that para (2)(a) renders such an instrument liable to duty under the paragraph. In DKLR Holding (No 2) at 471 Brennan J said: "Instruments which have no legal operation as well as instruments which are effective declarations of trust are brought to charge by par (2) if their terms answer the statutory description. It is not necessary to enquire as to the likelihood of the property becoming vested in the declarant, or as to the intentions or expectations of the declarant or of the person in whom the property is presently vested. It follows that an instrument which declares that property comprised in the instrument shall be held in trust by the declarant is chargeable, for unless the property comprised in the instrument is presently vested in the declarant, it must be property to be vested in him. Construing par (2) in this way, the terms of the instant declaration answer the statutory description and the instrument is brought o charge accordingly." See also Tooheys Ltd v Commissioner of Stamp Duties NSW (1960) 60 SR (NSW) 539 at 545-546. 40 It follows from these considerations that the document entitled "Trust Deed" even if an escrow was at least an instrument which was first executed for the purposes of the Act by the plaintiff on 27 October 1997. 41 Furthermore, if for the purposes of para (2)(a) the escrow conditions must be first fulfilled before the instrument, which is also a deed, is first executed for the purposes of the Act then on the authorities of Alan Estates Ltd and Ansett Transport Industries (Operations) the document in question was first executed by the plaintiff on 27 October 1997. 42 In Tooheys Limited & Ors v Commissioner of Stamp Duties NSW (1961) 105 CLR 602 at 609 and 611 in dealing with the phrase "to be vested" in the then clause 2 of the Second Schedule (which as I have already mentioned is identical with the present para (2)(a)) the High Court held that where contrary to what a "Trust Deed" stated, a sum of 50,000 was not contributed to a superannuation fund until after the execution of the deed established the fund, that sum was held to be assessable under the "to be vested" phrase in the paragraph. 43 While there were dissenting views in the High Court relating to one aspect of the judgment of the Full Court of NSW on a point which bears no relevance to this matter, all judges of the High Court agreed that whilst the judgment of the NSW Full Court which was written by Walsh J, correctly construed the then extant para (2) of the Second Schedule of the Act. 44 In Toohey's Ltd & Ors v Commissioner of Stamp Duties [1960] SR (NSW) 539 at 545, Walsh J said: "For the description of an instrument contained in para (2) under the heading 'declaration of trust' in the schedule is not so phrased as to be confined to declarations which create or which evidence a trust which is thereby or has already been completely constituted in such a way that property is then irrevocably subjected to the trust, and that the trusts are thenceforth immediately enforceable. Because of the inclusion of the words 'vested or to be vested' and the words 'is or shall be held in trust', the description extends to cases where no property is as yet vested in the proposed trustee, and it extends to cases in which no trust presently operative is declared. Thus it extends, in my opinion, to instruments which would not be classified, in the ordinary language of an equity lawyer, as being declarations of trust. The question is not, therefore, whether this deed is, in the ordinary sense of the term, a declaration of trust, but whether it satisfied the statutory description. It is only to be expected that this description would go beyond the ordinary sense of the term, since 'ordinary' declarations of trust as included in the definition of 'conveyance' and are thus chargeable without recourse to the provision now under consideration." 45 Accordingly, the fact that none of the property referred to in the subject "Trust Deed" was not vested in the plaintiff at the time of the execution of the deed, that no operative trust may not have been constituted by the deed, that the words "to be vested" do not occur in the deed and that the recital is incorrect in stating that the plaintiff had purchased all properties does not exclude the "Trust Deed" from liability under para (2)(a). 46 Additionally, the High Court has construed the words "to be vested" as importing mere futurity. In DKLR Holding (No 2) at 471 Brennan J said: "The property 'to be vested' is the property 'comprised therein'. The phrase 'to be vested' imports futurity, in contrast with 'vested'. 'Vested' speaks of property presently vested in the declarant, 'to be vested' speaks of property to be vested in him in the future. In Tooheys Ltd v Commissioner of Stamp Duties (NSW), (1961) 105 CLR at 612 Dixon CJ said of this provision: 'the words 'any property vested or to be vested' seem to me to be directed simply to the two cases, namely the case of the declaration of a trust of property then vested in the person who declares the trust and the second case of a declaration of trust in advance of the vesting in the person who declares it of property which it is intended to make the subject of the trust.' 47 Neither the words of para (2)(a) nor the judgment of Dixon CJ in Toohey's Ltd suggest that anything more than futurity of vesting is imported by the words 'to be vested'. The intention referred to by Dixon CJ is not an intention to vest the property in the declarant but to make the property the subject of the trust when vested. That intention, expressed by the declarant in the instrument, is the only intention imported in para (2)(a) and it is imported by the words 'shall be held in trust' not by the words 'to be vested'." 48 In Pendal Nominees Pty Ltd , Mason J having observed that in DKLR Holding (No 2) Brennan J (as did Gibbs CJ) considered the words "to be vested" imported a mere futurity concluded that perhaps contrary to what he himself had said in DKLR Holding (No 2) the construction given to para (2)(a) by Gibbs CJ and Brennan J should now be adopted. He went onto observe at 15: "The liability of an instrument to duty should not call for an inquiry into the intention of the maker of the instrument. The fact that the maker takes the trouble to execute the instrument is enough to bring para (2)(a) into operation. Actual intention or expectation is not a criterion of operation of the sub-paragraph." 49 It is apparent from the facts that at the time when the "Trust Deed" was signed and sealed by the plaintiff and the other parties, none of the three properties had vested in the plaintiff. If the contract relating to 32 Edward Street had been in fact exchanged before the signing and sealing of the "Trust Deed" the only interest which the plaintiff would have had was an equitable interest. See Stern v McArthur (1988) 165 CLR 489 at 522. 50 In short as of 27 October 1997 all three properties fell squarely within the phrase "to be vested" in para (2)(a). Accordingly, in my view the principal submission made on behalf of the plaintiff must fail. 51 In relation to this submission, as I have noted above, objection was taken to it being argued on the basis that it had not been raised in the Notice of Objection by the plaintiff to the Commissioner. 52 In the Notice of Objection the plaintiff's objection which it was claimed founded the appeal included the following: 1. It was put that the expression "void and inoperative" was sufficient to found the argument which I have set out and dealt with above. It is true that in dealing with review matters there is authority for the proposition that in determining whether the ground of appeal can be argued by a tax payer the courts should not interpret grounds of objection made technically, narrowly or with rigidity. See Dixon J in A L Campbell & Co Pty Ltd v Federal Commissioner of Taxation (1951) 82 CLR 452 at 461. To like effect, Williams J in H R Lancey Shipping Co Pty Ltd v Federal Commissioner ofTaxation (1951) 9 ATD 267 at 273. 53 These authorities were in the context of the then extant s 185 of the Income Tax Assessment Act 1936 which required an objector to "state fully and in detail" the grounds upon which he relies. Under this Act the only requirement is for an objector to lodge a statement in writing of the grounds of his objection. 54 Here there was no suggestion made that the Deed of Trust was in fact void. Albeit the argument was that at the time it was signed and sealed, it was inoperative. 55 The grounds of the objection taken were as follows:- (a) the Trust Deed is void and inoperative because at the date of the declaration (27 October 1997) it was not properly constituted, the contracts of sale relating to the relevant property (nos 32, 34 and 36 Edward Street, Baulkham Hills) being contrary to the premises set out in the Trust Deed; (b) para (2)(a) does not apply because the Trust Deed failed to declare that any future property was to be vested in the objector; and (c) the liability should be computed by reference to each individual property rather than the aggregate amount. 56 In addition to its argument that the grounds of objection should not be looked at narrowly, the plaintiff contended that this point fell within s 100 of the Taxation Administration Act 1996 NSW. That section, which has operated since 1 July 1998 provides: "The appellant's and respondent's cases on the appeal are not limited to the grounds of the objection." 57 The summons in this matter was filed on 25 June 1998. The Taxation Administration Act , by Schedule One, s 28 does not apply to any Notice of Decision or Determination of the Commissioner made prior to 1 July 1998. Accordingly s 100 cannot be called in aid by the plaintiff in this matter. 58 In Szajntop v Federal Commissioner of Taxation (1993) 42 FCR 318 at 327.9, it was held that the question to be posed is whether the Commissioner could reasonably be expected to gather from the written objection that he was being asked to apply his mind to the contention then being raised. 59 In my view the escrow point could not be thought to be a matter which the Commissioner could reasonably have been expected to gather from either the written objection or the correspondence. 60 In my view the matter raised with which I have dealt is so far distant from any concepts taken in the grounds of objection that in fact the points taken by the defendant should in fact be upheld. However, in any event I have dealt with the matter on its merits. 61 Finally, the plaintiff submitted in the alternative as follows: "If it is held that the Deed was first 'executed' as at 27 October 1997, even though the first party delivered it as an escrow then a legal fiction is necessarily created. In other words, the Deed is read 'as if' it was unconditional. In such a case there is no requirement to investigate the truth of the recitals. On its face it answers the description set out in paragraph 1 under the head of Declaration of Trust. It is 'a fundamental principle of the law relating to stamp duties that duty is levied on instruments not on the underlying transactions per Mason J in DKLR Holding (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 at 449. Thus the Deed is to be assessed nominal duty of $10. There is no warrant to impose duty under paragraph 2(a). To do so is to make an unworkable alloy of fact and fiction. It is simply impermissible to read into the deed that the properties were 'to be vested' so as to fall under paragraph 2(a). To do so would be to contradict the words of the Deed which recites in the past tense that an implied trust as at 27 October 1997 was effectively established; see paras, A, B and C. As such it satisfied paragraph 1." 62 In particular the construction adopted by Walsh J in the Full Court in Toohey's Ltd, to which I have made reference, is in my view decisive of this argument. Here as in Toohey's case, the property (in Toohey's case money, in this case real property) did not become trust property until after the execution of the instrument. Accordingly this submission, like the primary submission, must fail. 63 It follows there will be a judgment for the defendant plus costs. 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