Caratti v Deputy Commissioner of Taxation for the Commonwealth of Australia
[2005] WASCA 205
•1 NOVEMBER 2005
CARATTI -v- DEPUTY COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA [2005] WASCA 205
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2005] WASCA 205 | |
| Case No: | CACV:51/2005 | 30 SEPTEMBER 2005 | |
| Coram: | WHEELER J | 1/11/05 | |
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Applications for leave to appeal dismissed | ||
| B | |||
| PDF Version |
| Parties: | MADDELIENE CARATTI DEPUTY COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA VENETIAN NOMINEES PTY LTD |
Catchwords: | Practice and procedure Leave to appeal Turns on own facts |
Legislation: | Rules of the Supreme Court 1971 (WA), O 66 r 2(e) Supreme Court Act 1935 (WA), s 60(1)(e) |
Case References: | Deputy Commissioner of Taxation for the Commonwealth of Australia v Robinswood Pty Ltd [2005] WASC 67 Deputy Commissioner of Taxation for the Commonwealth of Australia v Robinswood Pty Ltd [2005] WASC 67(S) Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 Wilson v Metaxas [1989] WAR 285 Kimpura Pty Ltd v JWH Group Pty Ltd [2004] WASCA 134 Smiths Ltd v Middleton (No 2) [1986] 2 All ER 539 Turner v Kostoglou [2005] SASC 132 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA CITATION : CARATTI -v- DEPUTY COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA [2005] WASCA 205 CORAM : WHEELER J HEARD : 30 SEPTEMBER 2005 DELIVERED : 1 NOVEMBER 2005 FILE NO/S : CACV 51 of 2005 MATTER : Application for leave to appeal pursuant to s 60(1)(e) of the Supreme Court Act 1935 (WA) BETWEEN : MADDELIENE CARATTI
- Applicant
AND
DEPUTY COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA
Respondent
BETWEEN : VENETIAN NOMINEES PTY LTD
- Applicant
AND
DEPUTY COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA
Respondent
(Page 2)
Catchwords:
Practice and procedure - Leave to appeal - Turns on own facts
Legislation:
Rules of the Supreme Court 1971 (WA), O 66 r 2(e)
Supreme Court Act 1935 (WA), s 60(1)(e)
Result:
Applications for leave to appeal dismissed
Category: B
Representation:
CACV 51 of 2005
Counsel:
Applicant : Mr G R Donaldson SC & Mr S J Lemonis
Respondent : Mr S Owen-Conway QC & Mr R E Lindsay
Solicitors:
Applicant : Fairweather & Lemonis
Respondent : Australian Government Solicitor
CACV 52 of 2005
Counsel:
Applicant : Mr G R Donaldson SC & Mr S J Lemonis
Respondent : Mr S Owen-Conway QC & Mr R E Lindsay
Solicitors:
Applicant : Fairweather & Lemonis
Respondent : Australian Government Solicitor
(Page 3)
Case(s) referred to in judgment(s):
Deputy Commissioner of Taxation for the Commonwealth of Australia v Robinswood Pty Ltd [2005] WASC 67
Deputy Commissioner of Taxation for the Commonwealth of Australia v Robinswood Pty Ltd [2005] WASC 67(S)
Suttor v Gundowda Pty Ltd (1950) 81 CLR 418
Wilson v Metaxas [1989] WAR 285
Case(s) also cited:
Kimpura Pty Ltd v JWH Group Pty Ltd [2004] WASCA 134
Smiths Ltd v Middleton (No 2) [1986] 2 All ER 539
Turner v Kostoglou [2005] SASC 132
(Page 4)
1 WHEELER J: These are applications for leave to appeal pursuant to s 60(1)(e) of the Supreme Court Act1935 (WA) from my decision published 12 May 2005 in this matter (Deputy Commissioner of Taxation for the Commonwealth of Australia v Robinswood Pty Ltd [2005] WASC 67(S)). The effect of that decision is that the two present applicants, being Maddeliene Caratti and Venetian Nominees, are jointly and severally liable with the other defendants in this action for the costs of the action. The costs are, as I observed in my reasons of 12 May 2005, no doubt very substantial.
2 The grounds of the applications, as a result of an amendment which I gave leave to make on 30 September 2005, are two. They are related. Ground 1 alleges that I made an error of law in the construction of O 66 r 2(e) of the Rules of the Supreme Court1971 (WA). That rule provides that in the absence of any special order, if there are several defendants and the plaintiff has a verdict against them, each of them shall be liable to the plaintiff for the entire costs, although they defend separately. It is submitted that there was no single verdict against each of the defendants. The second ground is that, in any event, my discretion miscarried in refusing to make a special order that the defendants pay "only the costs of the causes of action brought against them". There is no suggestion as to how those costs would be calculated, having regard to the way in which the case was put. However, it is, in my view, not necessary to address that issue.
3 The applicants submit that to obtain leave they must demonstrate that the decision as to costs is attended with "sufficient doubt" to justify the grant of leave, and that substantial injustice would be done by leaving the decision unreversed (Wilson v Metaxas [1989] WAR 285 at 294). The respondent submits that, where an application is in relation to a decision as to costs, a different and somewhat more restricted test applies. In my view, it is not necessary to determine this issue and I am content to assume that the applicants are correct for the purposes of the present decision.
4 I am further content to assume that, unlike the position which now prevails in relation to criminal appeals, where leave is required for each ground, the applicants must show only that one ground of appeal would satisfy the "sufficient doubt" test, together with the possibility of substantial injustice, in order to be granted leave in relation to both of the grounds which are raised.
(Page 5)
5 So far as the first of the grounds of appeal is concerned, the respondent makes a number of submissions. Principally, the respondent submits that it was not a point agitated, in any real sense, before me at the time at which I made the decision from which it is sought to appeal. The respondent therefore relies upon the well-known passage in Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438, per Latham CJ, Williams and Fullagar JJ. The respondent points particularly to the passage in which it is suggested that, where an appeal is from a discretionary decision and the Judge making that decision has not been given an opportunity of exercising the discretion in the light of that point, it is open to doubt whether the point should be permitted to be taken on appeal. Their Honours observe, of the case before them, that: "The decision whether or not to refuse specific performance in the exercise of the discretion is one peculiarly for the trial judge and his Honour should have been given an opportunity of exercising his discretion before being told that the appeal had been allowed upon a point he had no opportunity of considering" (page 438). Further, the respondent submits that the view which it appears I took of O 66 r 2(e) was, in any event, correct.
6 The applicants accept that the question of law which they now seek to agitate was not one argued before me earlier. That is correct; the point seems to me to be largely inconsistent with the argument as it was run. However, in the written submissions of the applicants on the earlier occasion there was a reference, although in the alternative and in passing, to the question which the applicants now seek to raise. It seems to me that there was therefore an "opportunity" for me to deal with it. Whether there was a sufficient opportunity for the respondent to deal with it may be another question, given the way in which the applicants' submissions came to be made, but I do not think it is necessary to deal with that issue, for reasons which will shortly appear. Further, although the submissions of the respondent may be correct, it seems to me that the question of law is fairly arguable. I would therefore take the view that, in relation to ground 1, the question is fairly arguable, and so that the decision is attended with "sufficient doubt".
7 The difficulty, in my view, arises for the applicants in relation to the requirement that they demonstrate that substantial injustice would be done by leaving the decision unreversed. The submissions of the applicants were broadly as follows. First, it was submitted that if they were correct as to ground 1, then, since I had exercised my discretion on the basis that there was a rule in O 66 r 2, and that they were required to show some grounds for departing from that rule, my discretion may have been exercised differently had I correctly appreciated that there was no such
(Page 6)
- presumptive rule. Alternatively (and this is the subject of ground 2), it is submitted that even if O 66 r 2 did apply, I had erred in the exercise of my discretion. I do not accept that either proposition is arguable.
8 The submission is correct that at [20] and [21] of my earlier decision ([2005] WASC 67(S)), I took as a starting-point the proposition that there was an "ordinary principle" of joint and several liability. However, in the following paragraph, [22], having canvassed briefly the interlinking of the evidence, the issues raised by the applicants, and the role which they played in the trial, I expressed the view that "in my view, the joint and several liability rule should apply". That is expressed positively; it is not the expression of a view that no grounds have been shown to depart from an ordinary rule, but rather is a positive finding that it is appropriate that there be joint and several liability.
9 In any event, for the reasons which I summarised in the decision published 12 May 2005 ([2005] WASC 67(S)), it is my view that the applicants would be unable to demonstrate that my discretion should have been exercised differently, whether starting from the proposition that O 66 r 2 applied, or whether looking at the exercise of a broader discretion. As I noted in [22] of that decision, my reasons in the action published 29 April 2005 (Deputy Commissioner of Taxation for the Commonwealth of Australia v Robinswood Pty Ltd [2005] WASC 67) refer in detail to the interlinking of the evidence in relation to all defendants. At [22] I refer to the fact that, in addition, there were issues raised by these two applicants which the other defendants did not raise. It can be seen from the record of proceedings that only three of the defendants, being these two applicants and Robinswood Pty Ltd, were represented at and participated in the trial of the action.
10 Although they appear in different paragraphs of the applicants' submissions, and are worded somewhat differently, the applicants essentially make the same points in relation to the proposition that the discretion which I exercised miscarried under O 66 r 2(e) if it applied, and that a broader discretion should have been exercised differently. I deal with those factors relied upon by the applicants briefly.
1. It is submitted that I did not give "sufficient weight" to the fact that the amounts in issue had been tendered prior to the commencement of the trial. I gave it no weight. For the reasons which I outlined at [24] - [30], I am of the view that no weight could be given to it. This is particularly so, since, as present counsel for the applicants may not be aware, having tendered such
(Page 7)
- payment not long prior to trial, the applicants deliberately decided to proceed with the trial, rather than consent to judgment against them, in circumstances where it had been pointed out to them that proceeding to trial would incur additional costs, for which, if unsuccessful, they would be liable (transcript 25 October 2004 page 444 - 450).
- 2. It is submitted that I did not have regard to the fact that the proceedings had been consolidated. I refer to that at [18] of my reasons published 12 May 2005, and it appears to me that, having regard to the substantial overlap in evidence to which I have referred, consolidation was of benefit to each of the applicants, and could not have increased the costs of either of them significantly.
3. It is submitted that the issues raised against the applicants only involved a very small percentage of the total amount claimed, and a small percentage of the employees the subject of the relief sought. That may be correct, but the applicants have not suggested, in the context of the circumstances of this case, any reason why that would make it appropriate to apportion the costs between the various defendants. I remain of the view that, in this case (although not, of course, in all cases), those circumstances are irrelevant.
4. Finally, it is submitted that an appropriate exercise of the discretion would require the Court to assess to what extent the claims brought against each defendant would have occupied less court time if brought separately, and that if substantially less trial time would have been occupied, then the relevant defendant will suffer substantial prejudice, if jointly and severally liable for costs. That may well be an appropriate principle to apply. It is not necessary to determine in the present case whether it is, since, for the reasons which I outline briefly at [22] of my earlier decision, it seems to me that it could not be demonstrated that substantially less trial time would have been occupied had the claims been brought separately.
11 The applicants accept that the Court of Appeal ought not to be troubled by this matter unless it is arguable that a different result would flow as a result. For the reasons which I have given, I do not think it is. I would therefore dismiss the applications.
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