Pacific Film Laboratories Pty Limited and Collector of Customs [1979] AATA 2 (19 January 1979)

Last Updated: 12 March 2007

Customs Tariff - Classification of imported goods - Duty paid under protest - Sensitised paper - Application for review - Whether sensitised paper "in bulk rolls" - Whether words in Statute used in special sense - Whether special trade meaning in existence at date of Act - Proof of trade usage - "Uniform use and understanding" - Ordinary English meaning of words - Customs Act 1901 ss. 165, 167 - Customs Tariff 1966 Schedule 1 Part II, item 37.03 - Administrative Appeals Tribunal Act 1975 s. 33(l)(c)

PACIFIC FILM LABORATORIES PTY. LIMITED

COLLECTOR OF CUSTOMS

AAT Decision No 136

No: 78/10021

Mr A. N. Hall (Senior Member)

Mr R. L. Stock (Member)

Mr R. B. Hutchison (Member)

19 January 1979

ADMINISTRATIVE APPEALS TRIBUNAL

GENERAL ADMINISTRATIVE DIVISION

No. 78/10021

Re: PACIFIC FILM LABORATORIES PTY. LIMITED

And: COLLECTOR OF CUSTOMS

DECISION
The Tribunal affirms the decision of the Collector of Customs, New South Wales, classifying the goods entered for home consumption by Pacific Film Laboratories Pty. Limited on 3 December, 1977, as "other sensitised paper" under sub-item 37.03.9 of Part II in Schedule 1 to the Customs Tariff 1966.

DATED this 19^th day of JANUARY 1979

(A. N. Hall)
Senior Member

(R. L. Stock)
Member

(R. B. Hutchison)
Member

REASONS FOR DECISION

On 3 December, 1977, Pacific Film Laboratories Pty. Ltd. entered for home consumption a quantity of unexposed sensitised photographic paper described as "Sakuracolor P.C. Print Paper" which the company had imported from Japan. The goods as imported consisted of sensitised paper, 89mm (31/2") wide and 175 metres (550') in length, wound in rolls having a diameter, according to our observations, of approximately 25mm (10⅛") by a width of 89mm (31/2").
The company entered the goods under sub-item 37.03.1 of Part II of Schedule 1 to the Customs Tariff 1966 as "bulk rolls" which attracted a general rate of duty of 6%, based on a value for duty of $69720.90. The duty thus payable was $4183.25. However, on 5 December, 1977, the Collector of Customs N.S.W. issued a demand pursuant to section 165 of the Customs Act 1901 for the sum of $5577.68 on the ground that the goods were properly classifiable within sub-item 37.03.9 as "other sensitised paper". Under that sub-item, the general rate of duty applicable was 14%, the duty payable was $9760.93 and the sum demanded represented the difference in duty.
On 6 December, 1977 pursuant to section 167 of the Customs Act 1901, the company paid the sum so demanded under protest (by Warrant No. 1220765) and, within the time allowed by that section, made application to this Tribunal for review of the Collector's demand.

Excluding only the preferential rates of duty which are not relevant to the present application, item 37.03 of Part II of Schedule 1 to the Tariff is as follows:-

"37.03 * Sensitised paper, paperboard and cloth, unexposed or exposed but not developed:

37.03.1 - In bulk rolls, other than paper of a kind used in the reproduction of heliographic prints, blue prints and like prints 6%

37.03.9 - Other 14%
Item 37.03 itself has remained unchanged since the enactment of the Customs Tariff 1966, the relevant provisions of which came into operation on 14 February, 1966. The original sub-items, which were replaced by Act No. 39 of 1968, made no reference to "bulk rolls". The 1968 amending Act inserted new sub-items in their present form. The item and sub-items were re-enacted without change (except as to the rates of duty) by Act No. 117 of 1974, which came into operation on 1 July, 1974.
The applicant's case was very simple. The rolls of sensitised paper as imported were, as a matter of ordinary English, identifiable as "bulk rolls". The sense of that expression was "bulk paper in rolls". "Bulk", it was submitted, referred to size in a relative way. The rolls of paper as imported satisfied that description in a number of respects. They were rolls that could be used as a feedstock for machines operating a continuous developing process, producing well in excess of a thousand small photographs; rolls that are capable of being cut into many hundreds of sheets of sensitised paper; or rolls that could be slit into small width rolls. Because of these features, the imported rolls were entitled to the description "bulk rolls".

On the other hand, the Collector submitted that the expression "bulk rolls" was a technical trade term which the Tariff had adopted and which should be given, therefore, its trade meaning. The goods as imported did not bear the characteristics of "bulk rolls" as that expression was understood in the trade and used in the Tariff. Alternatively, as a matter of ordinary English, the imported rolls were not properly identified as "bulk rolls". On either basis, the goods fell to be classified as "other (sensitised paper)".
Before proceeding to a consideration of the evidence, it may be noted that it was common ground that the goods as imported fell within item 37.03 and that, if sub-item 37.03.1 was applicable, the words of exclusion following the words "In bulk rolls" had no application to the imported goods.
There were two witnesses called on behalf of the applicant, Mr Burton Magnus Munnings, the Technical Manager of the St. Leonards branch of the applicant company, and Mr Gunter Slamer, the Purchasing Officer of the Retail Division of that company. Mr Munnings gave evidence that he had been involved in the photo-finishing industry since 1949 and that he had commenced employment with the applicant in 1973. He said that unexposed sensitised paper was imported by the company from the manufacturer in Japan in rolls for use in the process of photo-finishing. The rolls were used in a machine called a roll head printer as a feedstock for a continuous process of developing and printing. Rolls of film submitted for developing are joined together into one long roll, the negatives are developed and then applied to the sensitised paper in a continuous roll. The paper is then cut into the individual images. Allowing for wastage, the imported rolls of paper could produce approximately 1000 photographs 31/2" square.
According to Mr Munnings, the company had roll head printers capable of handling rolls of film up to 8" in width and, in length, varying from 250 feet to 1500 feet. He also knew of such machines in Australia capable of handling rolls up to 42" wide in a continuous process of developing and printing.
Mr Munnings said that the imported paper could be cut or slit into sheets of varying size in addition to which the rolls could be converted by slitting into narrower widths and shorter lengths. But he did not say whether the imported rolls were, in fact, further processed in either of these ways by the applicant company.
Under cross-examination, Mr Munnings said that the company did not manufacture sensitised paper. The paper as imported did not come directly off the manufacturer's coating machine in one roll. The imported paper was completely coated on one side and there were no margins at either end that are not coated. He said he would not be aware if there were any coating defects in the roll until it was developed.

The expression "bulk roll" was one which Mr Munnings said he had used in the photographic industry. Photo-finishers, he claimed, "talking amongst themselves usually refer to this type of roll (i.e. the imported roll) as a bulk roll". He had heard of the expression "jumbo roll", which was used in relation to a 42" wide roll of paper "before it is all cut up". "Jumbo roll", however, was not an expression used in the photo-finishing trade. The expression "full width roll", according to his evidence, also referred to a 42" wide roll. But in his experience, rolls of 42" width and rolls of narrower dimensions and varying lengths were, in the photo-finishing trade, referred to as "bulk rolls".

Referring to the "professional" or "wholesale" price list published by the Ilford Company, the list included, in relation to black and white film, rolls up to 531/2" wide by 30 metres in length. Reference to the list also discloses that the smallest roli referred to was 30" wide by 20 metres long. By contrast, the retail price list did not include any rolls of sensitised paper at all.
The other witness called on behalf of the applicant, Mr Gunter Slamer, said that he had been employed by Pacific Film Laboratories Pty. Ltd. for approximately one year and that he was involved in the retail photographic industry. He said there were four major wholesalers of photographic equipment - Kodak, Agfa, Ilford and possibly Hanimex. He said that although there was a retail trade in sensitised paper sold in sheet form, precut and pre-packaged in varying sizes, there was no retail trade in rolls of sensitised paper. In support of this contention he produced a retail price list made available by the Ilford Company and the lists published by Agfa and Kodak. None of those retail price lists referred to rolls of sensitised paper. However, the professional (or wholesale) price list published by Ilford did include the rolls of film referred to in Mr Munnings evidence. Included in the professional price list was a reference to "bulk miniature rolls, 35mm by 60m and 35mm by 120m".
The trade meaning for which the Collector of Customs contended was that, in order to be identified as a bulk roll, the roll must be as it comes off the coating machine, complete with coating faults, edge selvedges and the inevitable production faults at the beginning and end of the roll. Once the faults had been removed and the edge and end selvedges removed, the roll loses its identity as a bulk roll and becomes a roll identified in the trade by another name such as a consumer roll or a finished roll. The imported goods were, in the Collector's submission, identifiable as finished rolls or consumer rolls. They lacked the characteristics of "bulk rolls" and could not, therefore, be identified as bulk rolls.
In an attempt to establish this trade meaning, the Collector called as witnesses on his behalf Mr John Maurice Pollard, the Manager of the Manufacturing Services Division of Kodak Australia Ltd., Mr Walter James Kemp, the Managing Director of Ilford Australia Pty. Ltd., and Mr Kenneth Norman Visca, the Manager of the Industrial Division of Hanimex. Mr Pollard gave evidence that he had worked for Kodak Australia for 30 years. To his knowledge Kodak was the only company in Australia which manufactured sensitised paper. The company also imported sensitised paper in rolls from related companies overseas. The manufactured or imported rolls are then converted into the various sizes which the end user may require.

Subject to strong objection from Mr R. Gyles Q.C., who appeared on behalf of the applicant, Mr Pollard gave evidence that within the Kodak organisation a bulk roll was –

"A roll of paper of full width as it has been coated and I would expect when I saw it or when it was finally delivered to the company, to the finishing department of the company, to have a selvedge on the edge where there was no photographic emulsion and which would have to he trimmed off. I would expect, that whoever was the company that supplied the bulk roll, would supply some testing information with it to perhaps indicate that on one side there was a defect that had to be eliminated, had to be cut out, was not saleable material, that there was a join, a so-called coating join at X feet through the roll (to) which once again some attention would have to be paid. Also there would be sensimetric technical data associated with the roll."

But it was clear" from Mr Pollard's evidence that in speaking of trade usage he was referring, primarily, to the use of the expression "bulk rolls", within the Kodak organization, although not limited to the manufacturing division of that organization. Mr Pollard had very limited dealings with other members of the photographic industry within Australia. He could recall only one or two casual occasions when he had heard the term used when in the company of people other than Kodak employees. He assumed they were referring to the same concept of "bulk rolls" as he understood. Because each of the major companies tended to be secretive regarding their manufacturing processes, there is very little cross-contact between companies and so far as "bulk rolls" are concerned, there is no retail market in such rolls as between manufacturing companies.
Mr Pollard said that in his experience in the time that he had been with Kodak, various expressions such as parent roll, master roll, full-width roll, jumbo roll and bulk roll had been used to describe the large rolls of manufactured paper. His evidence then continued:-

"Even within one company, such as the Eastmann-Kodak company in America, the terminology does vary from department to department and, whilst one department there could call it a full-width roll, another one would be calling it the master or parent roll, because these were all the same sorts of things, as far as we were concerned. Within our own organisation, the tendency became to lump them altogether under the one term of bulk roll, irrespective of whether the term used by the particular people we may have been importing the material from called it a master roll. We referred to it as a bulk roll."

He tendered copies of correspondence between Kodak Australasia and Kodak Pathe in France, written between 20 October, 1976, and 23 March, 1977, which tended to bear out, even at that time within the Kodak organisation in Australia, the interchangeability of the expressions "master roll" and "bulk roll". However, Mr Pollard was quite definite that he had never heard the terms "bulk roll", "parent roll" or "master roll" used in relation to a roll of sensitised paper such as the rolls imported by the applicant company.
Under cross-examination, Mr Pollard agreed that having regard to the characteristics which he saw as identifying a bulk roll in the sense in which that expression was used within the Kodak organization, the true comparison between such a roll and what he described as a "customer roll" was between a part-finished and finished roll. A 42" wide roll just off the coating machine with untrimmed selvedges and faults unrectified would conform to his understanding ox the trade meaning of "bulk rolls" but the same width roll which had been trimmed and in which any faults had been rectified would not be identified as a "bulk roll", but would be identified as a finished or customer roll. To his knowledge the only companies apart from Kodak who imported bulk rolls in the sense to which he had referred were Ilford Australia Ltd and Hanimex.
Mr Kemp gave evidence that he had been employed with the group of companies for 22 years, having worked for nine of those years in the United Kingdom as Group Production Manager of the Ilford factories for producing photographic paper and film. In 1966 he was transferred to Australia as Managing Director of the Australian company. In that capacity he is responsible for the manufacturing, marketing and finance operations of the company. The company imported what Mr Kemp referred to as "bulk rolls of photographic paper" ranging from 1,000 to 3,000 feet in length and around 42" wide. The bulk rolls are either slit on a slitting machine into roll widths and then chopped on another machine into particular lengths or the rolls are slit and subsequently chopped on the same machine. His evidence then continued:

" In each case, the selvedge edge is removed and the beginning and end trims are removed from the bulk roll. We receive a coating report from the parent company plant. We have plants in Switzerland, France and at two places in the UK. Whereever they come from, they send a report on the sensometric qualities of the roll and they report on where any faults may be within the roll, or any other characteristics that we should know in finishing that roll."

Again, subject to objection from Mr Gyles Q.C., Mr Kemp said that the expressions "bulk roll" or "parent roll" were quite common terms with which he was familiar in England.

Within a few days of his arrival in Australia in 1966, Mr Kemp was asked to attend a Tariff Board enquiry into the importation of photographic goods. At that enquiry his" company made a submission that there should be a separate category for bulk rolls which would have duty free entry. Kodak, as the only other importer of such rolls at that time, had submitted that a duty should be payable. It was after the Tariff Board had tabled its report in 1967 that the Customs Department approached Ilfords and requested a definition of what a bulk roll should be. Until 1966 the expression bulk roll had no "size meaning". However, in the definition which his company put forward, it was submitted that a bulk roll should be at least 30" wide, taken straight off the coating machine, having edge trims, beginning and end trims and coating faults. No finishing operation should have been carried out on the roll subsequent to coating in order for it to be entitled to be identified as a bulk roll. This definition, he said, eventually became a note to the Tariff. We take it that Mr Kemp was referring to the Annotated Tariff published by Customs which includes in the note to sub-item 37.03.1 the following annotation:

"Covers paper in widths exceeding 750mm (or such other smaller widths as may be determined) being paper put up in rolls imported for slitting into smaller widths and putting up in packs for retail sale or such other manufacturing processes as may be approved."

We refer to this Annotation to the Tariff as published by Customs, not because it has in itself any legal effect, but purely for the purpose of understanding Mr Kemp's evidence that, for Tariff purposes, that was the meaning of "bulk rolls". Mr Kemp said that he had heard the expression "bulk roll" used by people in the photographic industry at the various Tariff hearings that have taken place, in discussions with Customs and in discussions with other companies on Tariff matters. The expression did not arise in relation to marketing matters because rolls in that form are not marketed. It was, he said, very unusual for one company to buy bulk rolls from another. There was a very, very small trade in such rolls and, according to Mr Kemp, there were very limited ' occasions when Ilfords have either sold or purchased a bulk roll. When referring to the way in which people in "the trade" have referred to such rolls, Mr Kemp agreed that he was talking about the companies which import such rolls and- then do further work on them before selling them.
Mr Kemp said that he had heard of the expression "Jumbo rolls". He described it as "another one of those loose terms". For a long time "bulk roll" referred to a roll about 18" in diameter and 40-42" in width. Then the trade started to find ways of coating in longer lengths and handling bigger rolls and there was a tendency to talk about "jumbo rolls" because they were so much bigger. The term "jumbo roll" began to be used as meaning a very large "bulk roll", but "like so many of these terms it is also loosely used as meaning an ordinary big roll".
Ilfords had been importing bulk rolls for 20 years, but because of the lack of any specific Tariff item referring to "bulk rolls" as such, the company had been obliged to pay duty at the same rate as in respect of rolls of sensitised paper which he would describe as "finished". His company does not import rolls with the selvedge removed. That always has to be done as part of the finishing operation. In transporting such rolls, the rolls may be damaged on the edges if they are not handled very carefully. Thus there is an advantage in not removing the selvedge before shipping it to Australia.
The company had maintained a bulk roll store long before the discussions with the Customs Department in 1967. The bulk roll store has mechanical handling devices to enable the company to handle the bulk rolls which are big and heavy. He was not aware of "bulk rolls" being manufactured in widths less than 30". Whether "bulk rolls" had always been understood in the industry as relating to "unfinished rolls" did not emerge clearly from Mr Kemp's evidence. So far as his present understanding of the expression "bulk rolls" was concerned, it appeared to us that Mr Kemp's evidence did little more than reflect the definition which had been agreed upon between Ilford, Kodak and the Customs Department in 1967.
The remaining witness who was called to give evidence on behalf of the Collector was Mr K.N. Visca, who said that he had been employed by Hanimex for 25 years. For the last 16-18 years he had been involved in the industrial area of that company, which involved the supplying of equipment and materials to the photo-finishing industry. The company imported sensitised paper in roll form from an overseas supplier, Fuji Photo Film Company in Japan. These arrangements had been entered into in 1975. The "bulk rolls" are imported and then through a slitting operation are converted into finished rolls, which the company can market to consumers. There is no trade, he said, in "bulk rolls".

Mr Visca further said, however, that he would not identify the paper imported by the applicant as a "bulk roll" and that he had not heard such a roll identified by consumers as a "bulk roll". He had never known anyone to refer to it as such. He said that his company supplied a number of independent photo-finishing laboratories throughout Australia. They all use roll colour paper of varying widths and lengths.
The bulk rolls as imported by Hanimex are roughly 541/2" wide. The rolls are very heavy, weighing approximately 950 kilograms. The paper is approximately 2,000 metres in length and as imported does have selvedges. According to Mr Visea, a roll of that nature would never be used in the photo-finishing process because it could not physically be handled. Furthermore, having regard to the width of the roll and the selvedge, the paper would produce an imperfect result if it was ever put into a photo-finishing machine. Mr Visca drew the same distinction as Mr Pollard and Mr Kemp, namely that a roll which had been slit with the selvedges removed and defects checked -would not be a "bulk roll", even if it were 54" wide and 10' in diameter. Such a roll would, in the terminology used by Mr Visca, be a supply roll.

Mr Visca was unable to provide the Tribunal with any evidence as to any special meaning attached to the expression "bulk rolls" in relation to sensitised paper prior to the Tariff Board enquiry in 1966. He said that the first time he started hearing about "bulk rolls", "jumbo rolls" or "master rolls" was after the 1966 enquiry. During the negotiations between Hanimex and Fuji leading up to the agreement in 1975, his company referred to the rolls which it proposed to import as "bulk rolls".
As will be apparent from the evidence to which we have referred, Mr Kemp, in particular, found it difficult to give evidence of his understanding of the trade meaning of "bulk rolls" without referring to the Tariff Board enquiry and the discussions that followed that enquiry concerning a definition of "bulk rolls". Mr Towill, on behalf of the Collector, sought to tender a transcript of the evidence taken in relation to the Tariff Board enquiry and, additionally, to tender a copy of the Tariff Board Report, which was released on 2 June, 1967. Both of these documents were tendered on the basis that they would provide evidence of trade usage in relation to the term "bulk rolls" upon which the Tribunal could properly rely for the purposes of reaching its decision in this matter. Mr Gyles objected strongly to the tender of either document. As to the transcript, he submitted that what witnesses might have said about "bulk rolls" in the course of the Tariff Board enquiry was not evidence upon which the Tribunal could properly rely for the purpose of establishing a trade usage. The only way to prove such a usage was by proving a number of individual acts, not what a person says he calls a particular article but what he does in fact call it when he is trading. It was necessary, he submitted, to prove that each and every person in the trade is taken to have the same meaning for the same word. For the Tribunal to inform itself in this way would be to inform itself of an extraneous matter and to entertain evidence which was not relevant to the question under review. In his submission, therefore, the Tribunal should reject that evidence because its reception may vitiate the whole proceedings.
Although under s.33(1)(C) of the Administrative Appeals Tribunal Act 1975, Parliament has provided that, in a proceeding before the Tribunal, the Tribunal is not bound by the rules of evidence but may inform itself on any matter in such manner as it thinks appropriate, we concluded that it may be unfair to the applicant if we were to have regard to the transcript of evidence taken during the Tariff Board enquiry when there had been no opportunity for the applicant to test relevant evidence in cross-examination. We indicated that any witness whose evidence might assist in establishing the trade meaning of "bulk rolls" should be called before the Tribunal.
With respect to the Tariff Board Report, Mr Towill submitted that the Tribunal should not remain ignorant of the matters contained in the Report having regard to the fact that Parliament amended the Tariff to refer to "bulk rolls" shortly after the Tariff Board Report was released on 2 June, 1967. In fact, so our enquiries later disclosed, the Tariff was amended by Act No. 39 of 196S, which was assented to on the 18 June, 1968, and was given retrospective operation from 1 November, 1967, (see s.6). We invited submissions on behalf of the Collector whether the Tribunal could properly refer to the Report as an aid to interpretation of the Tariff, but that invitation was not pursued (see Maxwell on The Interpretation of Statutes, 12th Edition, pp. 51-54). We accordingly decided that we should not refer to the Report.

Proof of Trade Usage
In support of his submission as to the proper means of proving trade usage, Mr Gyles referred to the decision of the Supreme Court of New South Wales in Anderson v Wadey (1899) 20 N.S.W.R. 412 at p. 417 where the Chief Justice quoted with approval the following passage from Brown on Usage and Custom at p. 50:-

"'First then as to the principle of admissibility and the method of proof. Seeing that custom is only to be inferred from a large number of individual acts, it is evident that the only proof of the existence of a usage must be by the multiplication or aggregation of a great number of particular instances; but these instances must not be miscellaneous in character, but must have a principle of unity running through their variety, and that unity must show a certain course of business and an established understanding respecting it.'"

Counsel also referred us to the decision of the High Court of Australia in Thornley v Tilley (1925) 1 CLR at p. 8 where Knox C.J. had this to say:-

"The extent to which evidence of the existence of a custom or usage must go is defined by Jessel M.R. in Nelson v Dahl (1879) 12 Ch.D. at p. 575. He says:-
'That' (i.e. the existence of the alleged usage) 'is a question of fact, and, like all other customs, it must be strictly proved. It must be so notorious that everybody in the trade enters into a contract with that usage as an implied term. It must be uniform as well as reasonable, and it must have quite as much certainty as the written contract itself'".

To the cases on trade usage cited by Counsel may be added two further decisions of the High Court, namely Summers v The Commonwealth [1918] HCA 33; (1918) 25 CLR 144 and Rosenhain v Commonwealth Bank of Australia [1922] HCA 41; (1922) 31 CLR 46, particularly at p. 53 where the law is conveniently summarised. See also Halsbury's Laws of England (4th Edition), Volume 12, paras 473 et seq. All of the foregoing cases, it should be noted, concerned attempts to import into a contract or mercantile dealing an understanding based upon a custom or usage of trade.
A similar approach has been applied by the Courts to the interpretation of technical trade terms appearing in statutes passed with reference to a particular trade or business. In Craies on Statute Law (7th Edition) at p. 162, it is stated that there are two rules as to the way in which terms and expressions are to be construed when used in an Act of Parliament. "The first rule is that general statutes will prima facie be presumed to use words in their popular sense." Then, at p. 164, it is said that: "The second rule is that if the statute is one passed with reference to a particular trade, business or transaction and, words are used therein which everybody conversant with that trade, business or transaction knows and understands to have a particular meaning in it, then the words are to be construed as having that particular meaning which may differ from the ordinary or popular meaning."
The second rule has frequently been held to apply to laws such as the Customs Tariff. In Herbert Adams Pty. Ltd. v Federal Commissioner of Taxation [1932] HCA 27; (1932) 47 CLR 222 at p. 227, Dixon J. (as he then was), referring to a statutory exemption from sales tax in respect of "Pastry but not including cakes or biscuits", noted that it had been established by evidence before the trial Judge that "pastry" had a much wider trade meaning than in its popular sense. He then continued, "... the Legislature has expressed itself in a manner which amounts to a recognition, if not an adoption, of the trade meaning. Such a recognition might be expected, because the tax is levied by the various statutes upon persons who sell commodities in the common course of distribution, whether they manufacture or produce the goods they sell or acquire them by purchase. A revenue law directed to commerce usually employs the descriptions and adopts the meanings in use among those who exercise the trade concerned."

So also in Markell v Wollaston [1906] HCA 91; (1906) 4 CLR 141 at p. 150 O'Connor J. said:-
"The general rule of interpretation is that words used in a Statute must be taken to have been used in their ordinary meaning. If it is contended that there is a commercial or other special meaning of the word, there must be evidence before the Court on which it can come to the conclusion that the word is so used, and then it is for the Court to determine whether the legislature has used the word in its ordinary signification or in the special sense."

The same approach was adopted by the Court of Appeal in Thos. W. Ward Limited v Midland Railway (1917) 2 K.B. 278 with respect to the interpretation of a Schedule in an enactment passed in 1891 confirming the rates and charges to be applied to the carriage of articles of commerce by rail. With regard to the meaning of the expression "old files" Warrington L.J. at p. 287 said:-

"That. of course, is a question of construction, but it is only a question which can be determined when you have ascertained the meaning in a commercial sense of the terms which are used, because these Rates and Charges Orders represent in fact the settlement of questions between the railway companies and traders, and a Court asked to interpret such a document must know the sense in which the railway companies and the traders use what are in fact technical terms."

Cf. Ex parte Mackaness and Avery Pty. Ltd.; Re Royce (1943) 43 S.R. (N.S.W.) 239 at p. 244 per Jordan C.J.
Where it is sought to establish that the Legislature has adopted or recognised the trade meaning of a word or expression, evidence is admissible as to the commercial designation of particular articles at the date of the Tariff Act. As was said by Isaacs J. in Whitton v Falkiner [1915] HCA 38; (1915) 20 CLR 118 at p. 127:-

"Trade usage and commercial appellation are matters of actual fact, and the evidence properly admissible on such a head is as to what merchants and others did at the date of the Act in fact call such articles. If the articles were at that date unknown, or not known by that name, then merchants cannot, by merely appropriating a particular tariff designation and attaching that to an article, bring it into the country at the rate fixed for the true article of that name unless it be such true article.
The language of a Tariff Act, like that of every other Act, is to be taken in its ordinary signification, unless some secondary meaning is proved. The only appropriate secondary meaning in a Customs Act is that of commerce. If a commercial designation of an article is established, that should prevail from the nature of the operations which such an enactment is mainly intended to control. And the commercial designation that is to govern must be one which exists at the time the Legislature spoke, and must be, as the Act is, general and definite, and not local or limited to particular traders.
In the absence of evidence as to definite commercial designation different from their ordinary meaning, the interpretation of the words used as ordinary words is within the judicial knowledge."

However, in addition to evidence as to the commercial designation of an article at the date the Tariff Act was passed, evidence is also admissible to establish the characteristics which such articles possess. As was pointed out by Dixon J. in the Herbert Adams Case (supra) at p. 228:-

"... it has been considered permissible in applying a customs tariff to resort to evidence to ascertain what according to mercantile understanding are the characteristics connoted by the descriptive names used in the items as well as to identify the articles of commerce which possess them,"

The dangers in adopting evidence as to trade descriptions in an uncritical manner and the importance of ascertaining from trade evidence what are the characteristics connoted by descriptive names used in particular items of the Tariff is succinctly explained by Mason. J. in the following passage from his Honour's judgment in D. and R. Henderson (MFG) Pty. Ltd. v Collector of Customs for the State of New South Wales (1974) 48 A.L.J.R. 132 at p. 134:-

"Next it is important to keep in mind that trade usage is only relevant to the extent to which it instructs as to the meaning of the words 'coated, whether or not also impregnated'. How the trade describes the subject paper cannot determine the question whether it answers the statutory description (see Whitton v Falkiner [1915] HCA 38; (1915), 20 CLR 118 at p. 127), although it may give us some insight into what the trade understands by the expression 'coated paper'. Even so it is necessary to note that evidence as to trade usage has a tendency to limit the meaning of an expression to the denotation which it has at a particular time without making allowance for its capacity to extend to new exemplifications which have the characteristics of accepted denotations."

His Honour's reference to Whitton v Falkiner relates, as we understand it, to the warning which Isaacs J sounded in that case against merchants appropriating a particular designation, attaching it to an article and then seeking to bring that article into the country under that designation when it could not be truly identified as such.
In the same case, at p. 135, in referring to the attempt by the plaintiff to establish a limited trade meaning of the expression "coated paper", his Honour said that the witnesses called on behalf of the defendant established that the expression "is not uniformly-understood in the paper trade (including thereby the paper converting trade) in the limited sense", which the plaintiff's evidence had suggested. His Honour then concluded:-

"Although it may be acknowledged that in a statute such as the Customs Tariff, the Court will the more readily conclude that items have been described according to common commercial or trade usage and that the words have not been used in the natural and ordinary sense, the evidence does not satisfy me that the words in the relevant customs tariff item have a meaning which according to commercial and trade usage differs from their natural and ordinary meaning."

The problems associated with attempts to establish a narrower as opposed to a wider meaning of a particular term by reference to trade usage were adverted to by Dixon J. in the Herbert Adams-Case- (supra) at pp. 228-229:-

"In the next place, it is always less difficult to show that a word has a wider meaning than it is to establish a specialized use. For an extension of meaning involves no abandonment of the use in respect of things to which it would in any case apply; but a uniformly restricted application among any class of persons is necessary in order to establish that it has among them a narrower meaning and that meaning only."

Both in Henderson's Case (supra) and the Herbert Adams Case (supra), the Court was left with the impression, having regard to the trade evidence, that there was no uniform use and understanding within the respective trades of certain expressions to which a special meaning was sought to be attached. In both cases, therefore, the Court applied the ordinary meaning of the words in question.

As to the evidence needed to prove a special meaning by trade usage, Higgins J. in Whitton v Falkiner (supra) at p. 133 said that, "the usage must rest on actual instances of use, and not on mere opinion (Lewis v Marshall 7 M. & Gr 729 at p. 744 and see Curtis v Peek 13 W.R. 230)." Mr Gyles submitted that the only instances of trade use to which the Tribunal could properly have regard must relate to the trade in particular articles. Where, as in the present case, there is virtually no trade in unfinished" rolls (because none of the importers sell rolls in that form), Mr Gyles submitted that trade evidence could not be supplied by having regard to the internal practices of the major importers of such rolls, even though those internal practices may reflect a uniform understanding of the expression "bulk rolls".

In our view, these submissions went too far in restricting the evidence to which regard might properly be paid for the purpose of establishing the trade meaning of an expression used in the Tariff. Whilst undoubtedly, in many cases, trade evidence will consist of evidence of instances of usage related to the buying and selling of such articles, the identification of goods in a particular trade or profession may, we think, be evidenced in ether ways. For example, in the Herbert Adams Case (supra) at p. 229, Dixon J. referred to trade manuals and technical publications in order to ascertain whether, amongst pastry cooks, there was a specialized meaning of the word "cake". Evidence from technical experts also has its relevance (see Henderson's Case (supra) at p. 134). We would have thought that, consistently with these authorities, the Tribunal was entitled to have regard, in an appropriate case, to evidence as to trade usage from academics and technical educators in a specialised field.
In construing the Tariff, the question which we have to consider is whether there is a uniform trade understanding of a particular expression which Parliament should be taken to have adopted or recognized. There seems to be no warrant, in principle, or in the light of the authorities to which we have referred, for limiting our consideration to the evidence which may be appropriate for the quite different purpose of establishing whether a commercial custom or usage governs the operation of a contract or commercial dealing.
Summarised, we think that the decisions to which we have referred establish the following propositions for our guidance:-

(i)

With respect to revenue laws directed to commerce, courts are more ready to conclude that items have been described according to common commercial or trade usage rather than in their natural or ordinary sense (Henderson's Case (supra) per Mason J. at p. 135; Herbert Adams Case (supra) per Dixon J. at p. 227; Whitton v Falkiner (supra) per Isaacs J. at p. 127; Markell v Wollaston (supra) per O'Connor J. at p. 150).

(ii)

Whether there is a common commercial or trade usage in relation to a particular item is a fact to be proved by evidence: Markell v Wollaston (supra); Whitton v Falkiner (supra).

(iii) The evidence properly admissible is as to what merchants and others did, at the date of the Act, in fact call such articles; Whitton v Falkiner (supra); Herbert Adams Case (supra). Evidence . is also admissible to ascertain what, according to mercantile understanding, are the characteristics connoted by the descriptive names referred to in the legislation; Herbert Adams Case (supra).

(iv) But how the trade describes goods is not conclusive. Trade evidence may limit the meaning of an expression to the denotation which it has at a particular time without making allowance for its capacity to extend to new exemplifications which have the characteristics of accepted denotations; Henderson's Case (supra) per Mason J. at p. 134.

(v) Equally, if particular articles were, at the date of the Act, unknown, or not known by that name, merchants cannot, by merely appropriating a particular tariff designation and attaching that designation to an article, bring it into the country under that name unless it is in truth such an article; 'Whitton v Falkiner vsupraj.

(vi) It may be less difficult to establish a trade meaning which extends the ordinary meaning of an expression than one which limits the ordinary meaning in a specialised way; Herbert Adams Case (supra).

(vii)	If the expression is not uniformly under stood in a specialised sense in the trade, it cannot be assumed that Parliament has adopted or recognized that specialised meaning. In that ' event, the ordinary English meaning of the expression is applied, having regard to the legislative context; Herbert Adams Case (supra); Henderson's Case (supra).
(viii)	If there is a. common, commercial or specialised meaning of the particular item established by evidence, it is necessary to determine whether the legislation has used the word in its ordinary signification or in the special sense; Markell v Wollaston (supra).

In the light of this analysis, we consider that we were entitled to have regard to the evidence of senior experienced members of the Kodak, Ilford and Hanimex organizations as to their understanding of the expression "bulk rolls". But, having considered the whole of the evidence before us, we are not satisfied that, as at the date when the relevant provisions of the Customs Tariff were enacted by Act No. 39 of 1968, there was then any clearly established and uniformly accepted understanding of that expression. The only witness whose evidence .focussed directly on the trade understanding of "bulk rolls" prior to 1968 was Mr Kemp. But his evidence was, in our view, coloured by the definition agreed upon with Customs after the Tariff Board Report was tabled in June, 1967, as to what a "bulk roll" should be for the purposes of the Tariff.
There is, of course, ample evidence before us that the present understanding of the representatives of the Kodak, Ilford and Hanimex organisations is quite uniform that "bulk rolls" means "unfinished" rolls complete with selvedges and production faults. But on our understanding of the authorities, that is not the question. What matters is the meaning of "bulk rolls" prior to the 1968 amendment (see Whitton v Falkiner (supra) at p. 127).
We have not lost sight of the fact that the relevant provisions of Chapter 37 of the Tariff were re-enacted, without change, by Act No. 117 of 1974, which was assented to on 3 December, 1974, and was deemed to have come into operation on 1 July, 1974. There was no evidence before us directed specifically to establishing the trade understanding of "bulk rolls" as at that date, but we took it as implicit in the evidence of Messrs Pollard, Kemp and Visca that, by 1974, there was a common understanding within each of the companies they represented as to the meaning of "bulk rolls". Assuming, without deciding that such evidence could establish a "trade" meaning, the question arises whether the existence of that meaning by 1974 would entitle us to conclude that Parliament had adopted that trade meaning in its 1974 re-enactment of the Tariff.

Mr Gyles submitted that the relevant date as at which the trade meaning of "bulk rolls" should be considered (if at all) was the date on which the expression was first introduced into the Tariff in 1968. If we were to take any other view, the strange consequence could follow that, although in the 1968 amendment the expression "bulk rolls" "bore its ordinary grammatical meaning, the same expression in the 1974 re-enactment would have the more specialized meaning contended for by Customs.
We would agree that such a consequence is unlikely and that the same expression could be expected to have been used by Parliament with the same meaning in both the 1968 amendment and the 1974 re-enactment. In the result, therefore, the question resolves to the meaning of "bulk rolls" in the 1968 amendment.
We think it is unfortunate that, in the way in which the evidence was led before us, too little attention was directed to the means of establishing whether there was a uniform understanding within the photographic industry prior to the 1968 amendment as to the meaning of the expression "bulk rolls". Much of the evidence was, we think, misdirected. We make this comment notwithstanding the attempt to establish that understanding by reference to the transcript of proceedings before the Tariff Board and the subsequent Report of the Board. On an issue of such importance, direct evidence from witnesses who could speak of the understanding of that expression within the industry at that time (assuming there was such an understanding) should, in our view, have been adduced.

It is, of course, significant that the meaning contended for by Customs does not involve an extension of the ordinary meaning of the words "bulk rolls", but rather a limitation upon that ordinary meaning. The limited meaning would restrict it to rolls, most of the identifying characteristics of which are found otherwise than in the ordinary meaning of the word "bulk" - i.e. unfinished rolls having selvedges and production faults. As Dixon J. observed in the Herbert Adams Case (supra), there are difficulties in seeking to establish such a specialised use. It may be that, in such cases, the insertion of a special definition may be warranted. Our decision that there is no sufficient evidence of a trade meaning in the present case would not, it seems, preclude Customs from adducing "further evidence in that regard in any other case where that question might be relevant: see Halsbury's Laws of England (4th Edition) Volume 12, paragraph 478.
We are thus left to decide the question before us according to the ordinary English meaning of the expression "bulk rolls", having regard to the context in which that expression is used within Chapter 37 of the Tariff. For this purpose we put aside as irrelevant any evidence which the witnesses called before us may have given as to the ordinary meaning of the expression "bulk rolls": see Bendixen v Coleman, Scott and Croft [1943] HCA 40; (1943) 68 CLR 401 at p. 415 per Latham C.J.:-

"The court takes judicial notice of the meaning of ordinary words, and evidence is not admissible to expound their meaning, though the court, in addition to using its own knowledge, may refer to standard authors and authoritative dictionaries in order to obtain assistance in interpretation (Camden (Marquis) v. Inland Revenue Commissioners (1914) 1 K.B. 641)."

Necessarily, this involves rejection by us of any reliance upon the evidence of Mr Munnings that, in the photo-finishing industry, the imported rolls are described as "bulk rolls". At the same time, it renders otiose any attempted resolution of the conflict of evidence on that point between Mr Munnings and the witnesses called on behalf of the Collector.
We have to determine what "bulk rolls" means as a matter of ordinary English and then decide whether the goods as imported meet that description. There is no doubt, of course, that the goods are imported in rolls and are immediately identifiable as rolls of sensitised paper. However, they would not, in our view, as a matter of immediate identification, be described as "bulk rolls", despite their length and their capacity to be slit and cut into rolls of smaller width and length. The Concise Oxford English Dictionary includes amongst the meanings of the word "bulk" - "size, magnitude; great size; mass; large mass". In combination with the word "rolls", the impression conveyed to our minds is of rolls having great size and mass. The characteristics of great size and mass are, we think, to be found in the width, length and weight of the rolls. The imported rolls do not, in our view, possess such characteristics.

Further support for our conclusion may, we think, be found in the fact that the expression "bulk" commonly conveys the idea of goods in the form in which they are manufactured. "Bulk buying", for example, is defined in the Concise Oxford Dictionary as "the purchase by one buyer of all or most of a producer's output". It is clear from the evidence of Mr J. M. Pollard that sensitised paper is manufactured in rolls of appreciable length and width. From these rolls, by a slitting and cutting down operation, rolls of smaller quantities and widths are obtained and some of these latter rolls may themselves be subsequently further reduced in width and length. There was no evidence given that sensitised paper was manufactured in rolls of the width and length of the imported paper and indeed Mr Munnings' evidence in effect was that the paper as imported was a portion only of a larger manufactured roll.

One cannot be precise as to when a roll of sensitised paper can be said to have assumed the character of a "bulk roll". -While not accepting the special meaning of "bulk roll" in relation to sensitised paper for which the respondent contended, and recognising that the absence of any clear dividing line may pose difficulties in particular cases, we have concluded, on the evidence before us in this case, that the imported rolls do not bear characteristics which would serve to identify them as "bulk rolls" for the purpose of the Tariff.

Our decision is that the decision of the Collector of Customs, New South Wales, classifying the imported goods as "other" sensitised paper under sub-item 37.03.9 of Part II in Schedule 1 to the Customs Tariff 1966 is affirmed.