Facts

• The Appellant, Sea Shepherd Australia Limited (Sea Shepherd), conducts “campaigns” to protect marine wildlife from being harmed or killed by humans.
• The “campaigns” seek to protect whales by intercepting whaling fleets and obstructing whalers to prevent them injuring and killing whales.
• The First Respondent (the Commissioner) determined that Sea Shepherd’s activities did not satisfy para (a) of Item 4.1.6 in s 30-45 of the 1997 Act and that, therefore, Sea Shepherd was not entitled to be endorsed as a deductible gift recipient.
• The Second Respondent, the Administrative Appeals Tribunal (the Tribunal), affirmed the Commissioner’s decision.

 

Issue

Whether, upon its proper construction, item 4.1.6(a) of the table in section 30-45(1) of the Income Tax Assessment Act 1997 (ITAA 1997) extends to the case of a charitable institution whose principal activity is the protection of marine animals living in their natural environment from being harmed or killed by humans.

 

Held

The majority of the Full Court of the Federal Court dismissed the appeal.

Besanko J:

• According to Schedule 11, item 4, item 4.1.6 in the table in subsection 30-45(1) of the ITAA 1997. a charitable institution is eligible to be endorsed by the Commissioner as a DGR where its principal activity is one or both of:
  • providing short-term direct care to animals (but not only native wildlife) that have been lost, mistreated or are without owners; and/or
  • rehabilitating orphaned, sick or injured animals (but not only native wildlife) that have been lost, mistreated or are without owners.
• The animal welfare DGR category will not extend to the endorsement of organisations which are established solely to protect native animals.
  • Public funds which are established solely to protect native animals may be eligible for DGR endorsement under the existing general category of environmental organisations (section 30-55 of the ITAA 1997).
• Under s 30-45, the principal activity of the organisation must be to provide one or both of short-term direct care to animals that have been lost, mistreated or are without owners or the rehabilitation of those animals that are sick or injured.
• Institutions which have a principal purpose of advocating a political party or cause, attempting to change the law or government policy, or promoting a particular point of view are not charitable, and are therefore not eligible for endorsement under the animal welfare general category.
  • If an entity’s activities are otherwise charitable, the presence of political, lobbying or promotional activity that is only incidental to the dominant charitable purpose will not prevent the institution from being a charity.

 

Gordon J:

• A charitable institution whose principal activity is “providing short-term direct care to animals (but not only native wildlife) that have been lost or mistreated or are without owners” is entitled to endorsement as a deductible gift recipient under s 30-125(1) of the ITAA 1997
• Statutory construction of Item 4.1.6
  • The task is to construe the language of the statute, not individual words
  • The provision, or phrase in the provision should not be pulled apart into its constituent words divorced from the context in which it appears.
  • The text of the provision should be construed according to the context by reference to the language of the instrument viewed as a whole
• What is meant by “providing short-term direct care to animals (but not only native wildlife) that have been lost or mistreated or are without owners”?
  • The expression directs attention to activities and services (“short-term direct care”) provided in respect of a class of animals (that cannot be restricted to “native wildlife”) identified as animals “that have been lost or mistreated or are without owners”.
• The activities in which Sea Shepherd engages do not constitute the provision of “short-term direct care to animals”
• Read in the context of the whole provision, the expression connotes the direct provision by the organisation concerned of treatment or accommodation to animals. It is animals that must be the object of the care.
  • Taking steps to interrupt or prevent others harming animals in the wild, as Sea Shepherd does, is not the provision of “short-term direct care to animals” (emphasis added).
  • What Sea Shepherd attempts to do is to prevent the killing of whales. The object of its campaigns is the Japanese whaling fleet.
  •  It does not provide care to any animal.
• What is meant by “animals without owners”?
  • The phrase is one which tends to suggest that the animals in question could have an owner
• It is enough to say that, even if “animals without owners” is a phrase which can encompass whales before reduction to possession by capture, Sea Shepherd’s interception of attempts to capture and kill whales is not the provision of “short-term direct care” to the particular whales or whales more generally.