Borcherdt v Commissioner of Taxation (No 2)

[2014] FCA 208

FEDERAL COURT OF AUSTRALIA

Borcherdt v Commissioner of Taxation (No 2) [2014] FCA 208

Citation:	Borcherdt v Commissioner of Taxation (No 2) [2014] FCA 208
Appeal from:	RJ Borcherdt & GP Scott Trading as Nymboida Native Timbers v Commissioner of Taxation [2011] AATA 939
Parties:	RJ BORCHERDT & GP SCOTT TRADING AS NYMBOIDA NATIVE TIMBERS and ROBERT JOHN BORCHERDT v COMMISSIONER OF TAXATION
File number:	QUD 90 of 2012
Judge:	COLLIER J
Date of judgment:	12 March 2014
Catchwords:	COSTS – applicant sought review of decision of Administrative Appeals Tribunal – respondent conceded part of applicant’s claim before Tribunal – concession overlooked in final determination of Tribunal – application for review otherwise dismissed – costs follow event in absence of special circumstances – respondent liable for applicant’s costs of pursuing concession – applicant otherwise liable for respondent’s costs of and incidental to proceedings
Legislation:	Federal Court of Australia Act 1976 (Cth) s 43(2)
Cases cited:	Hughes v Western Australian Cricket Association (Inc.) (1986) ATPR 40-748 cited
Date of hearing:	Heard on the papers
Place:	Brisbane
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	6
Counsel for the First and Second Applicants:	Mr Borcherdt appeared on behalf of the Applicants
Counsel for the Respondent:	Mr VG Brennan
Solicitor for the Respondent:	McInnes Wilson Lawyers

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION	QUD 90 of 2012

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:

RJ BORCHERDT & GP SCOTT TRADING AS NYMBOIDA NATIVE TIMBERS
First Applicant

ROBERT JOHN BORCHERDT
Second Applicant

AND:

COMMISSIONER OF TAXATION
Respondent

JUDGE:	COLLIER J
DATE OF ORDER:	12 MARCH 2014
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.The applicants pay the costs of the Commissioner of Taxation of and incidental to the proceedings other than costs incurred by the applicants in prosecuting their claim for $11,105.30 the costs of which shall be set off against the costs incurred by the Commissioner of Taxation.

2.The total costs payable by the applicants are to be taxed if not otherwise agreed.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION	QUD 90 of 2012

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:

RJ BORCHERDT & GP SCOTT TRADING AS NYMBOIDA NATIVE TIMBERS
First Applicant

ROBERT JOHN BORCHERDT
Second Applicant

AND:

COMMISSIONER OF TAXATION
Respondent

JUDGE:	COLLIER J
DATE:	12 MARCH 2014
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. On 11 February 2014 I delivered the primary judgment in these proceedings (Borcherdt v Commissioner of Taxation [2014] FCA 56), and in so doing dismissed the applicants’ appeal from the decision of the Administrative Appeals Tribunal. After judgment was delivered the Commissioner of Taxation sought the opportunity to make submissions as to costs, and I made timetabling orders to that effect.

2. In summary, the Commissioner claims that costs ought follow the event. Mr Borcherdt however submits that as the applicants were partially successful in seeking allowance of their claim of $11,105.30, the Commissioner should pay their costs.

3. Section 43(2) of the Federal Court of Australia Act 1976 (Cth) provides that the award of costs is in the discretion of the Court. Such an exercise of discretion must be exercised judicially.

4. In Hughes v Western Australian Cricket Association (Inc.) (1986) ATPR 40-748 the Court observed that, as a general rule, costs should follow the event in the absence of special circumstances warranting a departure from that rule. In my view this statement is correct.

5. In this case the only special circumstance warranting any departure from that general rule relates to the Commissioner’s concession concerning the applicants’ claim for $11,105.30. It is clear that the Commissioner conceded before the Administrative Appeals Tribunal that the applicants’ claim in that amount ought be allowed, however somehow this concession was overlooked in the final determination before the Tribunal.

6. Mr Borcherdt claims that he was required to take his appeal to the Federal Court to ensure that the Commissioner’s concession concerning the applicants’ claim for $11,105.30 was enforced. To the extent that any costs were incurred by the applicants in relation to prosecuting that claim, I consider that the Commissioner should be liable for those costs. All other costs, however, incurred by the Commissioner of and incidental to the proceedings should be paid by the applicants, to be taxed if not agreed.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Collier.

Associate:

Dated:        12 March 2014