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contracts and agreements so as to embrace all kinds of concerted action by which persons
may arrange their affairs for a particular purpose or so as to produce a particular effect.
In summary, according to the statutory definition, an arrangement can be any of contracts,
agreements, plans or understandings. This definition is to encompass all kinds of concerted
action by which persons may organize their affairs for a particular purpose or to produce a
particular effect.
Contract
In the definition of arrangement, contract is the first term. In FCT v Newton 127 , contract was
considered as a technical word and implied an agreement enforceable by law.
In BNZ Investments 128 Richardson P stated contract is more formal than an agreement, and
in ordinary usage is usually written.
Therefore contract refers to transactions which involve an offer, acceptance, consideration
and intent to create legal obligations.
Agreement
Agreement is the second term in the definition of arrangement. According to observation by
Richardson P 129 , agreement is different with contract, which is less formal than contract.
However in some case, such as Newton 130 , contract and agreement were considered as the
same concept, which fundamentally different with the concept arrangement. Also in the
case Charles V Lysons 131 , Hoskin J stated that:
“In our opinion a contract or agreement by which the liability of the person who is the
owner, or who under the Act is to be deemed to be the owner, of the land at noon on the
31st March to pay the tax is cast upon or undertaken by some other person is a contract or
agreement which purports to alter the incidence of the tax, and within s 162 of the Land and
Income Tax Act, 1916, and that it is equally so if the undertaking applies only to part of the
tax.”
127 FCT v Newton (1957) 96 CLR577,630.
128 CIR v BNZ Investments Limited (2001) 20 NZTC 17,103, per Richardson P.
129 Ibid.
130 [1958] AC 450,465.
131 [1922] NZLR 902.
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