The Secretary, Department of Defence, has forwarded for advice, the following memorandum:

I have to inform you that contractors to this Department are required to consign goods per steamship to States other than the State of manufacture. Please see clause 14 in the attached Conditions of Contract.

As the Commonwealth is not subject to taxation by a State authority, bills of lading for goods consigned on behalf of the Commonwealth by Commonwealth officials are not stamped with a State duty stamp.

I shall be glad to be advised if contractors consigning goods on behalf of the Commonwealth in accordance with the above-mentioned clause of the Conditions of Contract are obliged to affix a duty stamp under the law of a State.

Clause 14 of the Conditions of Contract provides that:

Delivery of the supplies required under the Contract shall not be deemed to have been accepted by the Minister until-

1. Such supplies have been delivered in good order and condition in the State of manufacture either at-
1. The Ordnance Stores; or
2. The Government Factory (if any); or
3. F.O.B. at the shipping port of the capital city, as the Minister may elect; and
2. They have been inspected and passed by the Examining Officer as hereinafter provided: Provided, however, that in the case of supplies, delivery of which has been accepted f.o.b., the contractor shall be responsible for such supplies until they are received in good order and condition at the Ordnance Stores or the Government Factory in the State to which such supplies may be consigned. Such responsibility shall include the liability to make good any loss by pillage and any damage to the goods whilst in transit.

Clause 19 provides that:

The supplies shall be subject to the approval of the Examining Officer, and any supplies tendered or offered by the contractor for acceptance which, in the opinion of the Examining Officer, are inferior in quality of materials or workmanship, or differ in any respect from the Sealed Patterns, Specifications, Drawings, Samples, or other particulars (as the case may be) may be rejected by him.

In my opinion a contractor consigning goods to the Commonwealth is in respect of such consignment an agent of the Commonwealth, and the principle laid down by the High Court in D'Emden v. Pedder 1 C.L.R. 91, at p. Ill, applies.

I think, therefore, that the bill of lading relating to the consignment of the goods is not liable to stamp duty.

[Vol. 14, p. 76]