Body Corporate for Club Tropical Resort v Office of State Revenue [2011] QCAT 504

CITATION: Body Corporate for Club Tropical Resort v Office of State Revenue [2011] QCAT 504 PARTIES: Body Corporate for Club Tropical Resort v Office of State Revenue APPLICATION NUMBER: GAR329-10 MATTER TYPE: General administrative review matters HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Dr Peter McDermott, Member DELIVERED ON: 27 October 2011 DELIVERED AT: Brisbane ORDERS MADE: The decision of QCAT is to confirm the objection decision of the Commissioner of State Revenue dated 28 July 2010 to disallow the objection of the applicant dated 11 March 2010. CATCHWORDS: Whether a body corporate is an “on-supplier” Community Ambulance Cover Act 2003 APPEARANCES and REPRESENTATION (if any): This matter was heard and determined on the papers pursuant to s 32 of Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act). REASONS FOR DECISION INTRODUCTION [1] The applicant seeks a review of the decision made by the respondent to impose community ambulance cover levies on the applicant for premises which is known as the Club Tropical Resort at 2 Wharf Street, Port Douglas (“the premises”). BACKGROUND [2] On 7 April 2009 the applicant lodged an “On-supplier return” (in Form 21) with Ergon Energy Queensland Pty Ltd (“Ergon Energy”). In that form it was declared that there were 57 on supply arrangements in the premises, one of -- 1 of 6 -- 2 which was an exempt arrangement. It was also declared in that return that the commencement date for the arrangements was 7 April 2004. [3] Ergon Energy issued an account for the shortfall amount. [4] On 28 July 2010 the Commissioner of State Revenue disallowed an objection against a decision to impose the shortfall amount on the applicant. REVIEWABLE DECISION [5] I am satisfied that the decision of the Commissioner of State Revenue is a reviewable decision under s 17 of the Queensland Civil and Administrative Tribunal Act 2009. [6] The Community Ambulance Cover Act 2003 provides, in s 133 of the Act, that QCAT can review the decision of the Commissioner of State Revenue. [7] The reviewable decision is the decision of the delegate of the Commissioner of State Revenue dated 28 July 2010, being a decision to disallow an objection against a decision of the Commissioner to impose the shortfall amount on the applicant. GROUNDS OF OBJECTION [8] The applicant was entitled to lodge the objection under s 127 of the Community Ambulance Cover Act 2003 being an electricity customer of an electricity retailer. [9] The applicant raises a ground of objection that s 14(d) of the Community Ambulance Cover Act 2003 provides that a “critical element” of every “type 1 on-supply arrangement” is that “the on-supplier has the facility to further supply and further sell some or all of the electricity for consumption at the separate area” (i.e. each of the separate lots). [10] The applicant has contended that the applicant has never had “possession” of the electricity and that it must be able to “give up” or “deliver” the electricity. [11] The applicant has also contended:- “The Concise Oxford Dictionary defines the verb “sell” as meaning to “hand over in exchange for money” with the Macquarie Dictionary defining it as meaning “to give up or make over for a consideration; dispose of to a purchaser for a price”. Accordingly, in order for the Body Corporate to be able to “sell” electricity to the individual strata lot owners, it must be able to “give up” or “deliver” the electricity to the lot owners and, in order for it to be able to do that, it must have first had possession of it – which it clearly has not had. Obviously, a key element of possession is the possessor’s ability to withhold supply of electricity to an individual strata lot. -- 2 of 6 -- 3 [12] The objection of the applicant dated 11 March 2010 mentions that all of the electricity which is consumed within strata lot numbers 1 to 57 inclusive on CTS 18306 is supplied direct to each lot by Ergon Energy. Ergon Energy bills the account for this supply (measured via a single Ergon-fitted meter) to the Body Corporate (rather than in the names of all the strata title lot owners) for convenience purposes only. It is contended in the objection that the Body Corporate is not an “on supplier” for the purposes of the Act and the “invoice for the payment of levies back-dated to April 2004” should never have been raised. CONSIDERATION [13] A direction has been made for this matter to be determined on the papers by a member of QCAT. [14] The reference in the objection of the applicant to s 14(d) of the Community Ambulance Cover Act 2003 is a typographical error and I will read the objection as if it referred to s 14(1)(d) of the Community Ambulance Cover Act 2003. [15] Under s 128(1) of the Community Ambulance Cover Act 2003 the grounds of objection must be stated fully and in detail in the written objection lodged with the Commissioner. The objection of the applicant does not take issue with the application of any other provision of the Community Ambulance Cover Act 2003. In deciding this application I shall examine the operation of s 14(1)(d) of the Act. [16] I should also state that s 133(3) of the Community Ambulance Cover Act 2003 provides that the grounds on which the application for review is made are limited to the grounds of the relevant objection, unless QCAT otherwise orders. There is no reason in my view why any other ground of objection could be raised. [17] This application raises the interpretation of s 14(1)(d) of the Community Ambulance Cover Act 2003 which provides that an on-supply arrangement (type 1) exists for a separate area if “the on-supplier has the facility to further supply and further sell some of all of the electricity for consumption at the separate area”. This paragraph sets out one of the five conditions that are prescribed under s 14(1) of the Act: see paragraphs (a) to (e). The applicant is, in my opinion, correct in stating that the terms of s 14(1)(d) are a “critical element” of an on-supply arrangement (type 1). [18] The applicant as an objector has the onus of proving the objector’s case. This is laid down by s 129 of the Community Ambulance Cover Act 2003. [19] The objection of the applicant dated 11 March 2010 mentions that all of the electricity which is consumed within strata lot numbers 1 to 57 inclusive on CTS 18306 is supplied direct to each lot by Ergon Energy. Ergon Energy bills the account for this supply (measured via a single Ergon-fitted meter) to the Body Corporate (rather than in the names of all the strata title lot owners) for convenience purposes only. -- 3 of 6 -- 4 [20] It is contended in the objection that the Body Corporate is not an “on supplier” for the purposes of the Community Ambulance Cover Act 2003. In considering the objection I must determine whether the arrangement between the applicant and the holders of units in Club Tropical Resort can be regarded as an “on-supply arrangement”. [21] The applicant now contends that it is not an on-supplier. However, it has earlier made a declaration that it is an on-supplier. On 7 April 2009 the applicant lodged an On-supplier return in Form 21 with Ergon Energy. In that form it was declared: “I declare that I am the on-supplier or authorised to sign on behalf of the on-supplier and that all of the information supplied in this form is true”. It was also declared that there were 57 on supply arrangements in the premises, one of which was an exempt arrangement. [22] This declaration is itself sufficient evidence in my view to base a finding that the applicant is an on-supplier. The objection does not raise any argument that the person making the declaration did not have any authority to make the declaration although such a submission was made after the lodgement of the objection. [23] In construing the Community Ambulance Cover Act 2003 it is legitimate to have regard to examples in the Act. This is because an example in an Act of the operation of a provision of an Act is part of the Act: see Acts Interpretation Act 1954, s 14(3). The examples of on-supply arrangements in s 14(1)(d) of the Community Ambulance Cover Act 2003 are useful in construing the expression “on-supply arrangement”. The examples are part of the Act and Example 2 is particularly appropriate to the determination of this application. That example concerns a situation where the applicant is a body corporate for a residential building: “Electricity sold by an electricity retailer to a body corporate for a residential building is sold by the body corporate to the building manager who further sells to an owner of a unit in the building.” [24] This example is analogous to the present case with the added interposition of a building manager. The other examples (examples 2 and 3) where electricity is supplied to a shopping centre owner for distribution to shops are also analogous to this situation where the electricity is supplied to the body corporate for sale to the owners of units. [25] I find that the applicant is a part of an “on-supply arrangement” within the meaning of s 14(1)(d) of the Community Ambulance Cover Act 2003. The on-supply arrangement is the provision of electricity by the electricity retailer, Ergon Energy, to the applicant body corporate which further sells the electricity to the owners of units in the building. [26] The words “sell” and “supply” are present in s 14(d) of the Community Ambulance Cover Act 2003. In my view the applicant does “sell” electricity to the lot owners. This is because the applicant as a body corporate does “deal with a commodity or service”: see The Penguin English Dictionary (2002), p. 805. One dictionary meaning of “supply” is “to provide or furnish somebody with (something)”: see The Penguin English Dictionary (2002), -- 4 of 6 -- 5 p. 805. In my view the body corporate in their on-supply arrangement are dealing with the provision of electricity to the owners of units in the Club Tropical Resort. Such an interpretation is certainly consistent with the examples in s 14(1) of that Act. [27] The applicant has made a number of submissions in the objection about how the word "sell" has to be interpreted. It is contended that the applicant has never had "possession" of the electricity and that it must be able to "give up" or "deliver" the electricity. An argument was advanced that the applicant had no ability to withhold the supply of electricity to a strata title unit. In my opinion these interpretations are not applicable to the interpretation of the word "sell" in s 14(1)(d) of the Community Ambulance Cover Act 2003 and would impose a restrictive interpretation of the word "sell". Those submissions might be more appropriate where goods rather than electricity are being sold. [28] One argument has been advanced by the applicant that to “sell” electricity any sale must be at a profit. The argument was raised because the cost of electricity is equally borne by the owners of units in the Club Tropical Resort. This argument was not raised in the objection but in my view it cannot be sustained as it would impose a meaning on the word “sell” which is not intended by Parliament. The Act does not use the terminology “sell at a profit” in s 14(1)(d) instead of “sell”. The acceptance of this argument would also allow arrangements to defeat the objectives in s 3 of the Community Ambulance Cover Act 2003 which ensure that the burden of the levy is borne by all persons who use electricity in Queensland. [29] The respondent has made a submission that the Community Ambulance Cover Act 2003 has to be applied in the context of the Electricity Act 1994 which regulates the system of the sale and supply of electricity in Queensland. Reliance was placed upon the decision in Commissioner of Stamp Duties v Permanent Trustee Co Ltd (1987) 9 NSWLR 719 where it was held that it is proper where a number of Acts form a scheme of legislation to look at all of the Acts comprising the scheme when interpreting them. [30] In that case the Court of Appeal of New South Wales examined the relationship between the Real Property Act 1900 (NSW), the Trustee Act 1915 (NSW) and the Stamp Duties Act 1920 (NSW) when interpreting the latter Act. The principle in Commissioner of Stamp Duties v Permanent Trustee Co Ltd (1987) 9 NSWLR 719 rests upon the principle that the expression transfer or vesting had a meaning in one statute that it had in other statutes: see per Priestly JA (at 729). In this case the respondent submits that the expression “on-supplier” is used in a common way. [31] As part of the submission that the Community Ambulance Cover Act 2003 and the Electricity Act 1994 have to be read together, the respondent submits that there are express references to the Electricity Act 1994 in the Community Ambulance Cover Act 2003 (ss 10 and 23) and in the Explanatory Notes to the Community Ambulance Cover Act 2003. The respondent contends that this supports the reading of the interrelationship between the Acts. The respondent has submitted that the applicant has a -- 5 of 6 -- 6 “standard connection contract” with Ergon Energy (Electricity Act 1994, s 49) under which Ergon Energy sells electricity to the applicant. [32] The applicant submits that it does not meet the definition of an "on-supplier" under s 20 of the Electricity Act 1994 as the electricity must be for use within premises of which the applicant is either the "occupier or owner". I am not satisfied that on the material before me that the applicant comes within the terms of this definition even though there is an example in s 20 of a "relevant body corporate". In my view it is not necessary for me to make a final ruling on this point. [33] I do not accept that the Community Ambulance Cover Act 2003 and the Electricity Act 1994 need to be read together. The starting point in ascertaining whether the applicant is part of an “on-supply” arrangement is to first construe the Community Ambulance Cover Act 2003. Example 2 in s 14(1) of that Act makes it quite clear that the applicant, as a body corporate, can be part of such an on-supply arrangement, and there is nothing in s 14(1) which makes me come to a contrary conclusion. [34] Although not raised in the objection, the applicant has pointed out that only two of the strata lots are used for permanent residence, fifty lots are issued for short-term accommodation, three lots are used for commercial/retail purposes and the two remaining lots are used for administration purposes. Under the scheme of the Community Ambulance Cover Act 2003 the purpose for which a lot is used is not material. Whether or not a lot is unoccupied, the levy is still payable over the separate area of the lot: see Community Ambulance Cover Act 2003, s 14(2)(d). The examples to s 14(1) of the Act make it clear that the levy is payable even though a lot is vacant or where a lot is used for residential or commercial purposes. [35] As a matter of completeness I should mention that the Community Ambulance Cover Levy Repeal Act 2011 has repealed the future imposition of the community ambulance cover levy. However, the liability to pay the shortfall amount that was imposed under the electricity account tax invoice/statement on 6 May 2009 (which was confirmed under the decision of the Commissioner of State Revenue dated 28 July 2010) has been preserved by s 6 of the Community Ambulance Cover Levy Repeal Act 2011. DECISION [36] For these reasons it is the decision of the Tribunal (pursuant to s 24(1)(a) of the Queensland Civil and Administrative Tribunal Act 2009) to confirm the decision of the Commissioner of State Revenue dated 28 July 2010 to disallow the objection of the applicant dated 11 March 2010. -- 6 of 6 --