Comaz (Aust) Pty Ltd v Commissioner of State Revenue
[2015] VSC 294
•22 June 2015
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
TAXATION LIST
S CI 2014 1100
S CI 2014 1101
S CI 2014 1102
S CI 2014 1104
S CI 2014 1105
| COMAZ (AUST) PTY LTD | Plaintiff |
| v | |
| COMMISSIONER OF STATE REVENUE | Defendant |
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JUDGE: | CROFT J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 29 April 2015 |
DATE OF JUDGMENT: | 22 June 2015 |
CASE MAY BE CITED AS: | Comaz (Aust) Pty Ltd v Commissioner of State Revenue |
MEDIUM NEUTRAL CITATION: | [2015] VSC 294 |
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COURTS AND TRIBUNALS - Procedural fairness – Principles governing apprehension of bias – Whether the test for apprehension bias differs in a court or tribunal – Application of the rule in Jones v Dunkel where a party is unrepresented – Duty of a court or tribunal to assist an unrepresented litigant – Application of the Model Litigant Guidelines - AJH Lawyers Pty Ltd v Careri (2011) 34 VR 236 – Re Refugee Tribunal: Ex parte H (2001) 179 ALR 245 – Downes v Maxwell Richard Rhys & Co Pty Ltd (in liq) (2014) 313 ALR 383 – Tomasevic v Traveglini (2007) 17 VR 100.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr T Grace | RRR Lawyers |
| For the Defendant | Mr C Young | Commissioner of State Revenue |
HIS HONOUR:
Introduction
These five related proceedings have been brought pursuant to s 148(1) of the Victorian Civil and Administrative Tribunal Act 1998 (“the VCAT Act”). The plaintiff, Comaz (Aust) Pty Ltd (“Comaz”), is seeking to appeal against the orders of the Victorian Civil and Administrative Tribunal (“the Tribunal”) delivered on 12 February 2014 by which the Tribunal affirmed the assessment of the Commissioner of State Revenue (“the Commissioner”) in relation to a number of property transactions which had occurred some years earlier.
The applications for review were brought in relation to the Commissioner’s assessments on the purported sale and transfer of land of five parcels of land which were referred to as Shops A,[1] C[2] and E[3] and Units 1[4] and 2[5] of a development at 250-254 Chapel Street, Prahran. These five parcels of land were part of a larger development of land at the Chapel Street property into 20 residential apartments and five commercial properties.
[1]S CI 2014 1101.
[2]S CI 2014 1105.
[3]S CI 2014 1100.
[4]S CI 2014 1104.
[5]S CI 2014 1102.
In each of the five applications for review, Comaz was the transferee of the property. In each case save for Shop A, the named purchaser on the contract was not Comaz. However, Comaz claimed the “off-the-plan” concession provided for in s 21(3) of the Duties Act 2000, as it was argued that each of the contracts of sale in relation to the four relevant properties was made with the named purchasers as agents for Comaz pursuant to s 31(3) of the Duties Act 2000. In relation to Shop A, the issue was the appropriate method to calculate the apportionment of the construction costs referable to Shop A.[6]
[6]Commissioner’s Outline of Submissions dated 1 August 2014, [4] (‘Commissioner’s Submissions’).
The five applications were heard and determined together by the Tribunal. Evidence was heard over two days (3 and 4 February 2014) and closing submissions were made on 6 February 2014. On 12 February 2014, the Tribunal affirmed the Commissioner’s assessments (except for an issue about penalty tax rate which is not presently relevant).
Comaz’s appeal requires leave of the Court under s 148(1) of the VCAT Act. In view of the issues raised by the appeal, the hearing proceeded, with the agreement of the parties, on both the leave issue and the substantive issues raised by Comaz’s Further Amended Notices of Appeal dated 17 September 2014 (“Notices of Appeal”). At the hearing before me, counsel for Comaz indicated that the Further Amended Notice of Appeal in relation to Shop C would be taken to be representative of the proceedings in relation to Shops C and E and Units 1 and 2. Comaz also relied on the written submissions provided in relation to Shop C.[7] By the Shop C Notice of Appeal, Comaz set out the questions of law in relation to that proceeding in the following manner:
[7]A reference in these reasons to Comaz’s Submissions is made in relation to the written submissions filed by Comaz in relation to Shop C dated 2 July 2014.
(1) Whether there was a reasonable apprehension of bias by the Tribunal, in the form of pre-judgment, with the consequences that:
(a) the Tribunal failed to comply with the rules of natural justice contrary to s 98(1)(a) of the VCAT Act and the common law;
(b) alternatively, the Tribunal failed to act fairly and according to the substantial merits of the case as required by s 97 of the VCAT Act;
(c) alternatively, the plaintiff was denied procedural fairness.
(2) Whether the Tribunal failed to accord procedural fairness to the plaintiff by refusing to allow the plaintiff’s principal witness to give evidence about the finance (and in circumstances where the plaintiff had no legal representation and where the Tribunal proceeded to make findings adverse to the plaintiff relating to the financing).
(3) Whether the Tribunal failed to accord procedural fairness to the plaintiff, a party that had no legal representation, by failing to warn the plaintiff of the possible adverse evidentiary consequences if it did not call its solicitor as a witness (under the rule in Jones v Dunkel) and by the Tribunal then using that adverse inference on a significant finding of fact in its decision.
(4) Whether the Tribunal failed to provide a fair hearing to the applicant by receiving, and accepting, the evidence of Mr Frlan and Mr McCarthy in support of the Commissioner’s case.
(5) Whether the Tribunal failed to perform its review function by failing to consider the statutory basis for the Assessment under the Duties Act 2000 and thereby failed to satisfy itself of its own jurisdiction, as refined by s 109 of the Taxation Administration Act 1997 (the “TAA”) to hear and determine the matter, in circumstances where the applicant was not legally represented.
(6) Whether by failing to assist the plaintiff as a self-represented litigant to the standard, and in the manner, expected by the law:
(a) the Tribunal failed to comply with the rules of natural justice contrary to s 98(1)(a) of the VCAT Act and the common law;
(b) alternatively, the Tribunal failed to act fairly and according to the substantial merits of the case as required by s 97 of the VCAT Act.
(c) alternatively, the plaintiff was denied procedural fairness.
In relation to Shop A, the appeal was brought on slightly different grounds as there was no question as to whether the transfer was properly made for the purposes of the assessment. The Notice of Appeal in relation to that proceeding set out the questions of law as follows:
(1) Whether there was a reasonable apprehension of bias by the Tribunal, in the form of pre-judgment, with the consequences that:
(a) the Tribunal failed to comply with the rules of natural justice contrary to s 98(1)(a) of the VCAT Act and the common law;
(b) alternatively, the Tribunal failed to act fairly and according to the substantial merits of the case as required by s 97 of the VCAT Act;
(c) alternatively, the plaintiff was denied procedural fairness.
(2) Whether the Tribunal failed to accord procedural fairness to the applicant by preventing the applicant’s principal witness from giving evidence in support of its case.
(3) Whether by failing to assist the plaintiff as a self-represented litigant to the standard, and in the manner, expected by the law:
(a) the Tribunal failed to comply with the rules of natural justice contrary to s 98(1)(a) of the VCAT Act and the common law;
(b) alternatively, the Tribunal failed to act fairly and according to the substantial merits of the case as required by s 97 of the VCAT Act;
(c) alternatively, the plaintiff was denied procedural fairness.
As far as possible, I will deal with the questions of law in each proceeding collectively, as they are identical in terms for four out of the five proceedings. However, the appeal in relation to Shop A will necessarily require some separate discussion. Where the points being discussed in these reasons relate only to Shop A, this will be clearly indicated. In all other instances, a reference to the questions to be determined in these proceedings will be in regard to the proceedings as a whole.
Principles applicable with respect to appeals
Section 148(1) of the VCAT Act provides:
(1)A party to a proceeding may appeal on a question of law from an order of the Tribunal in the proceeding—
(a)if the Tribunal was constituted for the purpose of making the order by the President or a Vice President, whether with or without others, to the Court of Appeal with leave of the Court of Appeal ; or
(b)in any other case, to the Trial Division of the Supreme Court with leave of the Trial Division.
It follows from these provisions that any appeal is dependent upon two important qualifications. First, that the appeal be on a question of law and second, that the Court gives leave to appeal. The legislative policy underlying these provisions is that “VCAT decisions should not generally be disturbed where cases have been decided in that forum other than on questions of law and where there is something about the decision bearing upon the question of law which warrants a grant of leave to appeal”.[8] It follows that “[t]his Court is not entitled to enter into the fact finding exercise which the legislature has deliberately entrusted to a specialist tribunal”.[9]
[8]Commissioner of State Revenue v Frost (2011) 83 ATR 832 at 834 [5], referring to Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 335-6; Myers v Medical Practitioners Board (Vic) (2007) 18 VR 48 at 55 [28].
[9]Boucher v Dandenong Ranges Steiner School Inc (2005) 145 LGERA 21, referring to Spurling v Development Underwriting (Vic) Pty Ltd [1973] VR 1; Whitehorse City Council v Golden Ridge Investments Pty Ltd [2005] VSCA 198.
The leave requirement under s 148(1) is designed to maintain this position. As Pagone J said in Commissioner of State Revenue v Frost:[10]
The requirement for leave under s 148(1) of the VCAT Act “is a safeguard that the appeal is on a pure question of law and that the grounds supporting the question of law articulated for determination by the Court do found the subject matter of the appeal”.[11] It also confers a discretion about whether to grant leave[12] which an applicant must persuade the Court to exercise in its favour. What must be shown will depend upon the particular case bearing in mind the statutory criteria being a grant of leave and not special leave.[13] It will ordinarily be necessary (in addition to a clearly articulated question of law)[14] for an applicant to make out a prima facie case[15] and in an appropriate case it may be necessary for the applicant to show that the question upon which leave is sought has public or general importance.[16]
[10](2011) 83 ATR 832 at 833-4 [3].
[11]Commissioner of State Revenue v STIC Australia Pty Ltd (2010) 81 ATR 682 at 687 [10].
[12]Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331; Al-Hakim v Monash University (Unreported, Victorian Supreme Court of Appeal, 28 March 2003); Myers v Medical Practitioners Board (Vic) (2007) 18 VR 48.
[13]See Morris v R (1987) 163 CLR 454 at 475.
[14]Osland v Secretary to the Department of Justice [No 2] (2010) 241 CLR 320 at 333 [21].
[15]Morris v R (1987) 163 CLR 454 at 475; Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 335.
[16]Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 335-6; Commissioner of State Revenue v Challenger Property Nominees Pty Ltd (2006) 63 ATR 65 at 69 [20] and 77 [65].
In considering an application of this nature, courts have been concerned to respect the role entrusted by the legislature to the particular tribunal and not, in effect, subvert this position by seeking out error. Thus, Kirby J in Roncevich v Repatriation Commission, said:[17]
[17](2005) 222 CLR 115 at 136 [64].
Courts conducting this form of review have been repeatedly enjoined by this Court to avoid overly pernickety examination of the reasons.[18] The focus of attention is on the substance of the decision and whether it has addressed the “real issue” presented by the contest between the parties.
Similarly, in Vegas Nominees Pty Ltd v Werribee Sports & Community Club Inc, Ashley J said:[19]
This Court has said more than once that it should not examine briefly stated reasons by an expert Tribunal in an over-legalistic manner or by the over-zealous drawing of inferences in order to disclose some supposed error; although where unambiguous language is used, the user should be taken to mean what the words say. I should add that the Court is not entitled to interfere with the Tribunal’s decision unless it is satisfied that there was in fact a vitiating error of law. It is not enough for the appellant to show that the Tribunal’s reasons for its decision are so expressed as to suggest the possibility that it proceeded upon a wrong view of the law. In support of the several propositions that I have just stated I refer to Portland Properties Pty Ltd v Melbourne & Metropolitan Board of Works,[20] Michaelis Bayley (Vic) Pty Ltd v Melbourne & Metropolitan Board of Works[21] and Teston Investments Pty Ltd v Melbourne & Metropolitan Board of Works.[22]
Additionally, “[o]n appeal this Court must recognise the forensic realities of the way in which the case was put to the Tribunal. It is these realities to which a Tribunal must respond in its reasons”.[23]
[18]Minister for Immigration and Ethnic Affairs v Guo (1997) 191 CLR 559 at 575, 597; cf Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at 348 [74].
[19](Unreported, Supreme Court of Victoria, Ashley J, 21 December 1994) at 13.
[20](1971) 38 LGRA 6 at 18.
[21](1980) 44 LGRA 65 at 67–8.
[22](1985) 62 LGRA 346 at 349–50.
[23]The Gombac Group Pty Ltd v Vero Insurance Ltd [2005] VSC 442 [59].
For the reasons which follow, I am satisfied that Comaz has established questions of law which warrant the grant of leave to appeal and, further, that to the extent now relevant and appropriately dealt with by this Court, has been successful in this appeal. Were this simply an application for leave to appeal, I would, on the material to which reference is made in these reasons, find that a sufficiently arguable case has been established on the part of Comaz, as discussed in Secretary to the Department of Premier and Cabinet v Hulls.[24]
[24][1999] 3 VR 331.
Grounds for the Appeal
It is alleged by Comaz that the breaches of procedural fairness which occurred during the Tribunal hearing fall broadly into five categories.[25] As the grounds for appeal set out in the Notices of Appeal recognise, there is a degree of overlap between a number of these categories. For instance, the first question of law upon which the appeal is founded – whether there was a reasonable apprehension of bias – is stated as a separate and distinct question. The second such question of law – whether the refusal to allow Mr Cummaudo to give evidence on issues of finance amounted to a failure to accord procedural fairness – is similarly listed as a separate question. As the reasons which follow will indicate, the answer to Question One will, to some extent, be influenced by findings made in relation to question two. As will be apparent from these reasons, other instances of some degree of similarity will occur in relation to other questions on appeal. While I shall deal with each question separately, the close relation of the issues in question will necessitate some overlap of the reasoning.
[25]Transcript, page 4, lines 15 to 31.
Question One – Whether there was a reasonable apprehension of bias?
The first ground upon which these appeals were brought relates to the allegation that the Tribunal conducted itself in a manner which evidenced an apprehension of bias against Comaz, with the consequence that the Tribunal failed to comply with s 97 or s 98(1)(a) of the VCAT Act or, alternatively, acted in a manner which had the effect of denying Comaz procedural fairness. Section 97 of the VCAT Act requires that the Tribunal act fairly and according to the substantial merits of the case, while s98(1)(a) directs that the Tribunal be bound by the rules of natural justice.
The primary manner in which it was said that the apprehended bias manifested itself was that the Tribunal had pre-judged the credibility of the Comaz’s main witness, Mr Cummaudo, by concluding that Mr Cummaudo had engaged in fraudulent activity towards a bank. It is said that this conclusion was reached almost from the commencement of Mr Cummaudo’s examination-in-chief. The seriousness of such an allegation and the potential prejudice an action such as this by the Tribunal creates is amplified by virtue of the fact that the outcome of the hearing before the Tribunal rested largely on findings of credibility. Conclusions of fraud were reached, it was said by Comaz, in circumstances where such conduct had not been pleaded or alleged by any party at any stage of the proceeding; where the Tribunal had no recognised basis for making such an allegation; where the Tribunal’s conduct constituted a direct attack on the main witness for Comaz and in circumstances where Comaz had no legal representation.[26]
[26]Notices of Appeal, Grounds of Appeal 1(b).
The first comment of the Tribunal which it is said indicated an apprehension of bias occurred a mere 25 lines of transcript after Mr Cummaudo’s witness statement was tendered. After a response from Mr Cummaudo to a fairly unsatisfactory question from his non-legal representative – Ms Hirst - with respect to financing arrangements, the Tribunal made the following comments:[27]
Isn’t that fraudulent on the bank to do such a thing? I mean, Ms Hirst is your de facto. We have heard from her she is. I gather that’s correct is it, in 2002?
[27]VCAT Transcript, page 78, lines 16 to 19.
After some more cursory answers by Mr Cummaudo in response to questioning by the Tribunal regarding the status of the relationship between Mr Cummaudo and his de facto partner at the time, Ms Hirst, the Tribunal then went on to make the following remarks:[28]
Well, I’m just putting to you what you in fact were doing were defrauding the bank. You are a man who has had a lot of commercial experience. You have told us about that. What do you have to say about that? This matter is going to your credit.
See, let me explain to you the problems that I’ve got. I’ve got to make findings of fact in this case and findings of fact are very important. If you are a person who is willing to pull a swifty over the bank or defraud the bank that may be very important in whether I find that you are an honest man or not.
[28]VCAT Transcript, page 78, line 30 to page 79, line 10.
The financing arrangements issue which was the subject of the questioning to which these comments were directed is clearly an important issue and, in these circumstances, one might have expected the Tribunal to ask some neutral questions by way of clarification following Mr Cummaudo’s answers in response to the unsophisticated if not unsatisfactory questioning in chief by Ms Hirst. Alternatively, the Tribunal could have waited for cross-examination of Mr Cummaudo by the Commissioner on this issue, an issue which one would have expected to be cross-examined rigorously – and then ask questions by way of clarification to the extent that the cross-examination had not made the position clear as far as the Tribunal was concerned. In spite of this, the Tribunal, after three answers in examination-in-chief following the tendering of the witness statement, raised the issue of fraud. It is true that the issue was raised in the form of a question but as, in context, the Tribunal had apparently decided not to await cross-examination to clarify matters, questions at this point in examination-in-chief by way of clarification would have been expected to be ‘neutral’ and not, as the Tribunal’s questioning does, in my view, suggest a view on the part of the Senior Member that Mr Cummaudo’s conduct was fraudulent.
It is important to emphasise the timing of the impugned conduct, as the line of questioning by the Tribunal is, as observed previously, occurring in the very early stages of examination-in-chief before the evidence had been brought out more comprehensively in-chief or further clarified and questioned in cross-examination. Notwithstanding this, the Tribunal, without clarification of any detail, particularly with respect to financial matters, immediately purports to go to credit issues, putting to Mr Cummaudo, the principal witness for Comaz, the proposition that he was defrauding the bank by ‘pulling a swifty’ over it. All these factors leave a very strong impression that the Tribunal had a view at this early stage of the proceedings – a preconceived view – that Mr Cummaudo was a fraudster. This is, unfortunately, reinforced by what follows on the transcript
A comprehensive review of the well-settled principles governing the issue of apprehended bias was set out by the Court of Appeal in AJH Lawyers Pty Ltd v Careri[29] (“AJH Lawyers”). In AJH Lawyers, the appellant – a firm of solicitors providing legal and migration services – was appealing against a decision of a County Court Judge who had refused to recuse herself on the ground of apprehended bias. The allegation of apprehended bias was founded upon comments and remarks the trial judge had made on the second day of the hearing which suggested that her Honour may have formed the view that the bill the subject of the taxation of costs which was before her Honour was so large that the majority of costs must have been unnecessary. The comments which led to the appeal were also said to have indicated that her Honour may have formed the view that the appellants billed the large amount only by virtue of being self-represented, as an external client would never have allowed them to ‘run up a bill of that size’, while the comments also indicated that her Honour had formed a strong suspicion that the appellant had breached its professional obligations, in particular, by enquiring whether she had the power to refer the matter for investigation by disciplinary authorities.
[29](2011) 34 VR 236.
In allowing the appeal and remitting the matter to the County Court for determination before a different judge, the Court of Appeal set out the following principles, a number of which are highly relevant to these current proceedings:[30]
[30](2011) 34 VR 236 at 241-243, [18]-[25] (Warren CJ, Hansen JA and Almond AJA).
First, when one of the grounds of appeal is based on actual or apprehended bias, the Court of Appeal needs to deal with that ground first. If the appellant establishes actual or apprehended bias, the Court will set aside the decision below and remit the matter back.[31] This is so even if the Court is satisfied that the decision below is correct on the merits.[32]
Secondly, as noted in Antoun,[33] judges should not ‘too readily accept recusal because a party has demanded it’.[34] Further, as held in Ebner,[35] ‘[j]udges have a duty to exercise their judicial functions when their jurisdiction is regularly invoked and they are assigned to cases in accordance with the practice which prevails in the court to which they belong. ... If one party to a case objects to a particular judge sitting, or continuing to sit, then that objection should not prevail unless it is based upon a substantial ground for contending that the judge is disqualified from hearing and deciding the case.’[36] That being said, the principle that a judge should not disqualify him or herself too readily is not a ‘blanket that smothers the effect of disqualification where it has already arisen’.[37]
Thirdly, the test for a reasonable apprehension of bias was stated in Johnson[38] as being ‘whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question the judge is required to decide’.[39] The word ‘might’ in the phrase ‘might not bring an impartial and unprejudiced mind’ was clarified in Ebner as referring to ‘possibility (real and not remote), not probability’.[40] On the basis of Ebner, where, as in this case, ‘the matter has already been decided, the test is one which requires no conclusion about what factors actually influenced the outcome. No attempt need be made to inquire into the actual thought processes of the judge’.[41]
Fourthly, the apprehension in question is apprehension that the judge will not decide the case impartially, not merely an apprehension that he or she ‘will decide the case adversely to one party’.[42]
Fifthly, the application of the test involves two steps. The first step is ‘the identification of what it is said might lead a judge … to decide a case other than on its legal and factual merits’.[43] The second step is the ‘articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits’.[44] Contrary to AJH Lawyers’ submission,[45] the two-step approach is applicable to cases of apprehended bias on the ground of pre-judgment.[46] In such a case, the matter to be identified in the first step is the conduct of the judge said to give rise to apprehension of bias. And the logical connection that needs to be articulated in the second step is the logical connection between the conduct of the judge and the feared prejudgment of a question the judge is required to decide.[47]
Sixthly, ‘the perception of a lay observer will not be as informed as the perception of a lawyer, particularly a litigation lawyer’.[48] The fictional lay observer ‘is not to be assumed to have a detailed knowledge of the law, or of the character or ability of a particular judge’.[49] Yet the fictional observer is taken to understand the dynamics of modern judicial practice. Modern judges ‘are not expected to wait until the end of a case before they start thinking about the issues, or to sit mute while evidence is advanced and arguments are presented. On the contrary, they will often form tentative opinions on matters in issue, and counsel are usually assisted by hearing those opinions, and being given an opportunity to deal with them’.[50] ‘[T]he expression of tentative views during the course of argument as to matters on which the parties are permitted to make full submissions does not manifest partiality or bias’.[51]
Seventhly, ‘[a] line is drawn between forthright and robust indications of a trial judge's tentative views on a point of importance in a trial and an impermissible indication of prejudgment that has the effect of disqualifying the judge from further conduct of the proceedings’.[52] A key factor determining whether that line has been crossed is the extent to which the views expressed by the judge appear to be final rather than merely tentative.[53]
Finally, [‘j]udges do not have to devote unlimited time to listening to unmeritorious arguments. Sometimes, a brief hearing will suffice’.[54] That having been said, when a party makes an application, the judge must normally give the party some reasonable opportunity to make submissions in support of that application.[55] This is so even if the judge’s preliminary view is that the application will be unmeritorious.[56] If the judge refuses an application before receiving any submissions, the impression created by that conduct is not erased if the judge, after having announced his or her decision, agrees to listen to the party’s submissions under sufferance.[57]
[31]Subject to qualifications not presently relevant: see, for example, Vakauta v Kelly (1989) 167 CLR 568.
[32]Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577 at 581 [2] (Gummow ACJ), 611 [117] (Kirby and Crennan JJ) (‘Concrete’); Antoun v R (2006) 224 ALR 51 at 52 [2]–[3] (Gleeson CJ) (‘Antoun’).
[33]Antoun (2006) 224 ALR 51.
[34]Antoun (2006) 224 ALR 51 at 60 [34], (Kirby J).
[35]Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 (‘Ebner’).
[36]Ebner (2000) 205 CLR 337 at 348 [19] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
[37]Antoun (2006) 224 ALR 51 at 60 [35] (Kirby J).
[38]Johnson v Johnson (2000) 201 CLR 488 (‘Johnson’).
[39]Johnson (2000) 201 CLR 488 at 492 [11] (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ). See also Ebner (2000) 205 CLR 337 at 345 [7] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
[40]Ebner (2000) 205 CLR 337 at 345 [7] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
[41]Ebner (2000) 205 CLR 337 at 345 [7] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
[42]Re JRL; Ex parte CJL (1986) 161 CLR 342 at 352 (Mason J).
[43]Ebner (2000) 205 CLR 337 at 345 [8] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
[44]Ebner (2000) 205 CLR 337 at 345 [8] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
[45]Appellant’s (Plaintiff’s) Outline of Submissions (30 November 2009), [12].
[46]Concrete (2006) 229 CLR 577 at 609-10 [110]–[111] (Kirby and Crennan JJ).
[47]Concrete (2006) 229 CLR 577 at 609-10 [110]–[111] (Kirby and Crennan JJ).
[48]Concrete (2006) 229 CLR 577 at 635-6 [177] (Callinan J).
[49]Johnson (2000) 201 CLR 488 at 493 [13] (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ).
[50]Johnson (2000) 201 CLR 488 at 493 [13] (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ).
[51]Concrete (2006) 229 CLR 577 at 610 [112] (Kirby and Crennan JJ).
[52]Antoun (2006) 224 ALR 51 at [29] (Kirby J).
[53]Antoun (2006) 224 ALR 51 at 60 [33] (Kirby J); Concrete (2006) 229 CLR 577 at 635-6 [177]–[178] (Callinan J).
[54]Antoun (2006) 224 ALR 51 at 57 [22] (Gleeson CJ).
[55]Antoun (2006) 224 ALR 51 at 52 [2], 57 [21]–[23] (Gleeson CJ), 58-9 [28], 59 [30], 63 [48] (Kirby J), 64 [53], 65 [56] (Hayne J), 77 [83], 77-8 [86]–[87] (Callinan J).
[56]Antoun (2006) 224 ALR 51.
[57]Antoun (2006) 224 ALR 51 at 52 [2] (Gleeson CJ), 60 [36] (Kirby J), 78 [87] (Callinan J).
While the Commissioner here readily accepted the propositions which are raised in AJH Lawyers, he sought to distinguish that decision from the current proceedings on the basis that it was predicated on a finding of apprehended bias from a Judge in a judicial setting; whereas here the question of apprehended bias arises from an allegation of pre-judgment being made in a tribunal. In this respect, the Commissioner says that the principles in AJH Lawyers need to be qualified in regard to how they should be applied in the context of proceedings before the Tribunal in its review jurisdiction, as provided for here by s 106 of the Taxation Administration Act 1997, which is inquisitorial in its nature.[58]
[58]Transcript, page 72, lines 16 to 26; Commissioner’s Submissions [18].
The possibility of a distinction between the application of the principles governing apprehended bias between courts and tribunals was discussed by the High Court in Re Refugee Tribunal: Ex parte H[59] (“Ex parte H”). In holding that the ground of apprehended bias was made out against a member of the Refugee Review Tribunal, the High Court discussed the rationale behind the rule with respect to apprehended bias:[60]
However, the rule with respect to apprehended bias, as it has developed in relation to the judicial process, is not based solely on the concept of natural justice. Its development is also referable to the need to maintain confidence in the judicial process[61]. Thus, the rule as to apprehended bias, when applied outside the judicial system, must take account of the different nature of the body or tribunal whose decision is in issue and the different character of its proceedings[62]. Moreover – and on this the parties are in substantial agreement – regard must be had to the statutory provisions, if any, applicable to the proceedings in question, the nature of the inquiries to be made and the particular subject-matter with which the decision is concerned.
[59](2001) 179 ALR 245.
[60](2001) 179 ALR 245 at 426-7 [5] (Gleeson CJ, Gaudron and Gummow JJ).
[61]See Johnson v Johnson (2000) 201 CLR 488 at 492-3 [12] (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ). See also R v Watson; Ex parte Armstrong (1976) 136 CLR 248 at 266 (Barwick CJ, Gibbs, Stephen and Mason JJ).
[62]See Minister for Immigration and Multicultural Affairs v Jia (2001) 205 CLR 507 at 563 [181], 564-5 [187] (Hayne J) (with whom Gleeson CJ and Gummow J agreed at 538) [100]). See also Ebner v Official Trustee (2000) 205 CLR 337 at 343-4 [4] (Gleeson CJ, McHugh, Gummow and Hayne JJ). This approach is consistent with that adopted by Mason J in Kioa v West (1985) 159 CLR 550 at 585.
Later, the Court went on to say in regard to the different standards which may apply in a Tribunal setting as opposed to a court:[63]
The test for apprehended bias in relation to curial proceedings is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question to be decided.[64] That formulation owes much to the fact that court proceedings are held in public. There is some incongruity in formulating a test in terms of "a fair-minded lay observer" when, as is the case with the tribunal, proceedings are held in private.
Perhaps it would be better, in the case of administrative proceedings held in private, to formulate the test for apprehended bias by reference to a hypothetical fair-minded lay person who is properly informed as to the nature of the proceedings, the matters in issue and the conduct which is said to give rise to an apprehension of bias. Whether or not that be the appropriate formulation, there is, in our view, no reason to depart from the objective test of possibility, as distinct from probability, as to what will be done or what might have been done. To do otherwise, would be to risk confusion of apprehended bias with actual bias by requiring substantially the same proof.
Though the test in administrative proceedings, as in curial proceedings, is, in our view, one of objective possibility, the non-curial nature of the body or tribunal in question and the different character of the proceedings must, as already indicated, be taken into account. In the present case, a significant difference between curial proceedings and the proceedings of the tribunal is that the former are adversarial and the parties are usually legally represented, whereas the latter are inquisitorial in nature and the parties are not represented.
Where, as in the present case, credibility is in issue, the person conducting inquisitorial proceedings will necessarily have to test the evidence presented - often vigorously. Moreover, the need to ensure that the person who will be affected by the decision is accorded procedural fairness will often require that he or she be plainly confronted with matters which bear adversely on his or her credit or which bring his or her account into question. Similar questions by a judge in curial proceedings in which the parties are legally represented may more readily give rise to an apprehension of bias than in the case of inquisitorial proceedings.
[63]179 ALR 425 at 434-5, [27] – [29].
[64]See Ebner (2000) 205 CLR 337 at 344-5 [6] (Gleeson CJ, McHugh, Gummow and Hayne JJ). See also R v Watson; Ex parte Armstrong (1976) 136 CLR 248; R v Lusink; Ex parte Shaw (1980) 32 ALR 47; Livesy v New South Wales Bar Association (1983) 151 CLR 288; Re JRL; Ex parte CJL (1986) 161 CLR 342; Vakauta v Kelly (1989) 167 CLR 568; Webb v R (1994) 181 CLR 41; Johnson v Johnson (2000) 174 ALR 655.
While some concessions may be made in relation to the manner in which a decision-make in an inquisitorial setting may engage with a witness or party when compared to an adversarial proceeding, the High Court did recognise the limits which must still be applied in this regard when unrepresented litigants are involved:[65]
Where, however, parties are not legally represented in inquisitorial proceedings, care must be taken to ensure that vigorous testing of the evidence and frank exposure of its weaknesses do not result in the person whose evidence is in question being overborne or intimidated.
[65]179 ALR 425 at 435, [31].
In Ex parte H, the High Court held that the test for apprehended bias was made out - even allowing for a less-stringent test given the inquisitorial nature of the Refugee Review Tribunal – due to the constant interruptions to the evidence of the applicant and to the ‘constant challenges to his truthfulness and to the plausibility of his accounts of events, [and] that there was nothing he could say or do to change the tribunal’s preconceived view that he had fabricated his account of the events upon which he based his application for a protection visa’.[66]
[66]179 ALR 425 at 435, [32].
In my view, it would be erroneous in characterizing the role of a member sitting in VCAT to suggest that the principles enunciated in AJH Lawyers should be modified to the extent that their relevance to these current proceedings is diminished to the point of being irrelevant. While the effect of relevant provisions of the Taxation Administration Act 1997 is to provide for a hearing of a less-adversarial nature before the Tribunal in this instance as opposed to a hearing before a judge, AJH Lawyers should still be seen, in my view, as guiding the manner in which the principles relating to apprehended bias should be applied in these proceedings. As the Commissioner noted himself, the Refugee Review Tribunal is to be characterized as a tribunal much further towards the inquisitorial end of the spectrum than VCAT.[67] Moreover, the fact that proceedings at VCAT are conducted in public - as opposed to more administrative-type forums which may be conducted in private and not subject to such high standards of conduct – dictates the application of the requirement that justice must be seen to be done. It follows that expectations in relation to the conduct of the Tribunal must closely mirror those expected of a member of the bench in judicial proceedings. This applies particularly in relation to what a fair-minded lay observer might reasonably apprehend in regard to whether a tribunal member might not bring an impartial mind to the resolution of the question to be decided. In this regard, Acting President Judge Ross said in Seachange Management Pty v Bevnol Constructions & Developments Pty Ltd (“Seachange”):[68]
The impartiality of the Tribunal is central to a fair hearing. It is in this context that the apprehension of bias principle becomes relevant. Bias, whether actual or apprehended, connotes the absence of impartiality.
Applied to Tribunal members the governing principle is that a member is disqualified if a fair minded observer might reasonably apprehend that the member might not bring an impartial mind to the resolution of the question that the member is required to decide. The principle gives effect to the requirement that justice should both be done and be seen to be done.[69]
[67]Transcript, page 73, lines 3 to 9.
[68][2008] VCAT 1479, [36]-[37].
[69]Ebner (2000) 205 CLR 337; Re Finance Sector Union of Australia Ex parte Illation Pty Ltd (1992) 107 ALR 581.
The Commissioner also sought to distinguish the decision in Ex parte H on the basis that in that proceeding the offending conduct involved constant, rather than a singular, interruption. While agreeing that the test as articulated in Ex parte H does not rely solely on constant interruption, it was said there that it was the incessant repetition of the Refugee Review Tribunal’s belief that the male prosecutor was lying that founded the apprehension of bias. In those circumstances it is said that the conduct of the Refugee Review Tribunal was of a much more objectionable nature than that of the Tribunal in these proceedings. While that may very well be true, as the High Court said in that case, whether or not there is apparent bias depends on context. I made the observation, which I think is consistent with the judgment of the High Court, that, in context, it depends what – and probably when – things are said and the nature of the things which are said or impressions created by the Tribunal. Thus, in some circumstances, incessant interruptions or a combination of a number of statements may lead to the impression of bias and denial of the right to be heard. However, in other cases, a strong statement – even if only one statement – might be sufficient. In these proceedings, it was made very clear at the Tribunal and emphasised by the Commissioner that the allegations of fraud levied against Mr Cummaudo were a central tenet of the Commissioner’s case. What the Senior Member was doing, it was said, was merely inviting the witness to provide answers to these allegations.[70] In my view, these submissions cannot be accepted. Emphasising the centrality of fraud in this case only serves to emphasise the critical care which the Tribunal should have taken in the exchange with Mr Cummaudo in relation to his finance arrangements for the strata title development. Moreover, allegations of fraud are treated by the courts as allegations of the gravest nature – as is evident in the costs consequences for legal practitioners making unsubstantiated allegations of fraud.
[70]Transcript, page 75, lines 4 to 22; page 80, line 3 to page 82, line 11.
When one looks at the principles governing apprehended bias as set out in AJH Lawyers it is clear, in my opinion, that the conduct of the proceeding before the Tribunal establishes a very strong likelihood that a fair-minded lay observer might reasonably apprehend that the Senior Member did not bring an impartial and unprejudiced mind to the resolution of the questions in dispute. Judges and tribunal members, of course, are not to be expected to sit back placidly and listen to argument and evidence without forming opinions about the issues for determination or, indeed, asking questions and seeking clarification. Nor is the expression of tentative views during the course of argument, of itself, to be considered as indicating bias; in many instances it may be appropriate – and indeed necessary – for a judge or tribunal member to express preliminary views to assist the parties in arguing their cases and being reassured that the court or tribunal understands the matters being put. The High Court said as much in Vakauta v Kelly, where Brennan, Deane and Gaudron JJ observed: [71]
[A] trial judge who made necessary rulings but otherwise sat completely silent throughout a non-jury trial with the result that his or her views about the issues, problems and technical difficulties involved in the case remained unknown until they emerged as final conclusions in his or her judgment would not represent a model to be emulated.
[71](1989) 167 CLR 568 at 571.
But, again, as the High Court indicated in Ex parte H, the determinative factor as to what is acceptable expression, or not, will almost always be guided by the context in which the expression of opinion is made. Here, the expression of the opinion or belief that Mr Cummaudo had engaged in fraudulent activities was made very early in the giving of evidence, and in circumstances which created a strong impression that the Tribunal had pre-determined his credibility as a witness. For these reasons, Question One of the Notices of Appeal is made out. As I have indicated previously, the questions of law as stated in the Notices of Appeal do contain a degree of overlap in regard to the grounds upon which they are based. As the following reasons will indicate, the findings in relation to Question Two and Question Three will only serve to strengthen the finding there was an apprehension of bias.
The Court of Appeal indicated in AJH Lawyers, where one of the grounds of appeal is based on actual or apparent bias, that this ground should be dealt with first and, if established, the decision the subject of appeal be set aside and the matter be remitted back to the lower court or tribunal. On this basis, it would be appropriate now, in my view, to remit the matter back to the Tribunal to be heard before a different member. In the event that this view is found to be incorrect, I shall also address the other questions on appeal, save for Question Five. For reasons which I will indicate shortly, it is not appropriate, in my view, to deal with the other substantive matters which are the subject of Question Five, for to do so would impinge upon the proper function of VCAT as a specialist tribunal on such a remit.
Question Two – Whether the Tribunal failed to accord procedural fairness by refusing to allow Mr Cummaudo to give evidence relating to financial matters?
As I have indicated previously, the second question involves some degree of overlap with the question of whether there was apprehended bias, as it can be said that a reluctance to allow a party to give evidence may be a result of the Tribunal having already made up its mind as to the outcome of the case. While the preceding reasons indicate that an apprehension of bias did exist by virtue solely of the fact that the line of questioning the Senior Member directed towards Mr Cummaudo during the giving of his evidence created a very real apprehension of such bias, the refusal of the Tribunal to allow Mr Cummaudo to give evidence on certain points only strengthens these findings. In addition, a number of findings in this regard may also be seen to stand outside the principles in relation to apprehended bias, and which do of their own accord support the conclusion that the Tribunal did fail to accord procedural fairness - on this ground alone.
The first exchange to which the Court’s attention was drawn in relation to this ground of appeal occurred at the end of Mr Cummaudo’s examination-in-chief, and immediately after the exchange to which I have referred previously that indicated a pre-conceived belief on behalf of the Tribunal that Mr Cummaudo had engaged in fraudulent conduct against the bank. After that exchange took place it appears, from a reading of the VCAT Transcript, that counsel for the Commissioner commenced cross-examination labouring under the erroneous belief Mr Cummaudo’s evidence-in-chief had been completed. Upon realising his mistake almost immediately, he quickly apologised to allow the examination to continue, before the Senior Member interjected:[72]
[72]VCAT Transcript, page 79, line 26 to page 80, line 4.
MR YOUNG: Mr Cummaudo, both contracts you say were entered into on the same day. I’m sorry, I just realised ---
SENIOR MEMBER: I don’t think…have you finished your questions?
MS HIRST: Sorry?
SENIOR MEMBER: Have you finished your questions?
MS HIRST: My question was going to be about the finance.
SENIOR MEMBER: You’ve got no more questions to ask?
MS HIRST: No.
SENIOR MEMBER: So yes, Mr Young.
The Commissioner submits here that this exchange should not be seen as containing anything incorrect or untoward, but rather it should be read as indicating Ms Hirst was informing the Tribunal that she had indeed finished her questions, as she had already asked her sole question regarding finance.[73] A full reading of the VCAT Transcript shows, the Commissioner submits, that Ms Hirst was clearly capable of putting forward her views whenever it was required and was willing and able to clarify with the Tribunal whenever she thought she was being misunderstood. While the VCAT Transcript does indicate there were times when Ms Hirst was able to clarify any misconceptions as they arose, it is difficult to accept the Commissioner’s submissions on this exchange.
[73]Transcript, page 95, line 3 to page 96, line 11.
Having regard to the importance of the financial matters given the nature of the proceedings and the suggestion by the Tribunal that, in this context, Mr Cummaudo had defrauded the bank, one might have thought that a Tribunal with an open mind and concerned to clarify the details of financial matters would have encouraged Ms Hirst to ask her question or questions ‘about the finance’. In context of the part of the proceedings to which attention has been directed, the impression that would be gained from the Tribunal’s response to Ms Hirst’s reference to questions she was going to ask about the finance is that the Tribunal was not interested in hearing more about this issue and that the reality was that Ms Hirst was being told, in effect, not to ask any further questions. Added to the impression created by this exchange is the consideration that Ms Hirst is not legally qualified and is representing Comaz as a layperson. One can argue whether Comaz is to be regarded, through its representatives, as an unrepresented litigant. This debate does not, however, assist with respect to this issue – or subsequent issues with respect to procedural fairness – because the point is that, as was known to the Tribunal and to the representative of the Commissioner, they were dealing with people, such as Ms Hirst and Mr Cummaudo, who were without legal qualifications and possibly – and certainly as appears from the VCAT Transcript – probably inexperienced in relation to Tribunal procedure or civil litigation.[74] Moreover, there cannot be any doubt as to the importance and significance of this exchange, both as to the significant issue and the weight it bore in the Tribunal’s ultimate decision making. The latter is evident from the Tribunal reasons which indicate, clearly, the adverse effect it had on the Comaz case, as the Tribunal found that Mr Cummaudo’s evidence “made it clear, that he was prepared to mislead and deceive the bank or banks from which he was dealing. That is, he was required to have presold a number of units in the development, to unrelated parties prior to gaining finance.”[75]
[74]I will expand upon this point in greater detail when I turn to Question Six.
[75]Tribunal’s Reasons, [29(d)].
Shop A Assessment
As I have noted, the appeal in relation to Shop A is brought on different grounds to the other four proceedings. It is said by Comaz that the real objection in relation to the Shop A Assessment is that the Tribunal refused to listen to evidence which Mr Cummaudo sought to give in relation to the proper calculation of construction costs as required by s 21(2) of the Duties Act 2000.[76] While it is not necessary at this stage to deal with the question of the proper method to use to calculate construction costs, Comaz’s submissions on this point are relevant to the question of procedural fairness in relation to the appeal against the assessment on Shop A. They are also indirectly relevant to the question of procedural fairness in regard to the other assessments as the conduct of the Senior Member in this instance again reflects the Tribunal’s unwillingness, or inability, to provide an opportunity for Comaz to effectively present its case.
[76]Comaz’s Outline of Submission dated 2 July 2014 (S CI 2014 1101), [40].
While there were various parts of the VCAT Transcript which were referred to as providing support for the conclusion that a distinct lack of procedural fairness arose by the Tribunal’s failure to allow Comaz to fully put forward its evidence in relation to its case, probably most striking is an exchange between Mr Cummaudo and the Tribunal with respect to the value of units:[77]
[77]VCAT Transcript, page 134, line 15 to page 135, line 4.
MR CUMMAUDO: It costs less, it costs less to build the shops than what it cost to build one apartment, on the first floor. So, it’s totally irrelevant for stamp duty purposes, totally irrelevant for liability. Liability - - can I explain how the liability - -?
SENIOR MEMBER: Look, I think I’m here to interpret the law and I don’t think I need to ask someone like you for an opinion on it and that’s what you want to give now. Do you understand that?
MR CUMMAUDO: Okay, you don’t want to hear it?
SENIOR MEMBER: Well, you’re not a lawyer and - -
MR CUMMAUDO: I am a - -
SENIOR MEMBER: And you want your de facto to make submissions as to what the law is.
MR CUMMAUDO: People pay me to make up their units, liabilities and entitlements. They go through and get paid for consultancy to do this type of work and you’re not prepared to hear me?
SENIOR MEMBER: Well, I’m not prepared to hear your own expert opinion of which you are not expert. That’s exactly what I am saying. You’re not an expert on land tax.
Then an exchange with Ms Hirst follows.
Following the exchange set out above (and, presumably, on the basis of the earlier exchanges with the Tribunal), a further exchange follows between Mr Cummaudo and the Tribunal:[78]
[78]VCAT Transcript page 135, line 18 to page 136, line 4.
MR CUMMAUDO: Yes. I am really getting tired of looking at all this because I can see which way we’re going to go here.
MR YOUNG: We’re not even halfway through, Mr Cummaudo, so just be patient and we will get there.
MR CUMMAUDO: My evidence is obviously - - my evidence doesn’t mean anything here. I’m wasting my time being here. In fact, I’m going to walk out because - -
MR HIRST:No, it - -
MR CUMMAUDO: I’ve just been told I’m an idiot, I don’t know what I’m talking about.
SENIOR MEMBER: I didn’t tell if you were an idiot, I told you you weren’t an expert on land tax as in stamp duty - -
MR CUMMAUDO: No, and you said I wasn’t an expert on units.
SENIOR MEMBER: I didn’t. I said that you weren’t an expert - -
MR CUMMAUDO: On plan subdivisions - -
SENIOR MEMBER: You weren’t - - I didn’t want to hear your expertise on stamp duty or land tax, I didn’t want to hear that. That’s what I told you.
And the exchange continued.
Apart from analysing the preceding matters differently, the Commissioner says that any prejudice arising earlier in the proceedings – in examination-in-chief - were able to be cured by Ms Hirst in her re-examination.[79] For two reasons, this appears to be illusory or not relevant because, given the conduct of the Tribunal earlier in the hearing, it would be extremely difficult to dispel the perception of a preconceived view and the disinclination of the Tribunal to hear Mr Cummaudo’s evidence and evaluate it with an unprejudiced mind. Moreover, it must be remembered that Ms Hirst is not legally qualified and would find it very difficult to retrieve the situation in re-examination, even if this could, in the circumstances, have dispelled perceptions already created. Unfortunately, the adverse perceptions were probably only strengthened in the process of re-examination, as issues arose in relation to leading questions as appears, particularly on two occasions. On the first occasion, the Tribunal said:[80]
[79]Transcript, page 96, line 12 to page 97, line 27.
[80]VCAT Transcript, page 184, lines 6 to 17.
SENIOR MEMBER: What you are doing is asking leading questions and what you’re doing by that is suggesting the answers to the witness and, in other words, it becomes you giving the evidence rather than the witness.
Now, Mr Young hasn’t objected to it, and that’s fine, that’s for his own reasons. But because they are being led like this I would give the answers little weight because what you’re doing is you are really telling Mr Cummaudo what to say. Now, do you understand that?
MS HIRST:If they are your instructions.
SENIOR MEMBER: Okay.
Then followed exchanges between the Tribunal and Mr Cummaudo which resulted in his departing the hearing room.
Following the departure of Mr Cummaudo, the Commissioner made the following submissions to the Tribunal:[81]
MR YOUNG: And that’s entirely correct in accordance with at least the Court of Appeal authority if not the High Court authority, that the answers given to leading questions in re-examination are of marginal if any weight. So there was absolutely nothing wrong with the comment that you made, sir. In response to that request for a recess, provided it is a very brief one we have no objection. In that time, I would want to check the VCAT Act to see what options are available given what we have just seen. It might be that given Ms Hirst has the authority to proceed on the company’s behalf and provided she is here and otherwise does not want to ask any further questions of Mr Cummaudo in re-examination - -
SENIOR MEMBER: Yes - -
MR YOUNG: We can simply continue.
The proceeding was then stood down for a short time.
[81]VCAT Transcript, page 186, lines 9 to 24.
When the proceedings resumed, the following exchange occurred:[82]
[82]VCAT Transcript, page 187, lines 4 to 25.
MS HIRST:I wish to continue representing Comaz Australia.
SENIOR MEMBER: All right.
MS HIRST:I accept your points regarding leading the witness as you have quoted.
SENIOR MEMBER: I’m not stopping you doing it.
MS HIRST:I apologise that - -
SENIOR MEMBER: I was only advising that it’s not a terribly good thing for you to be doing.
MS HIRST:I accept that. That’s my personality trait coming out. I apologise.
SENIOR MEMBER: Thank you.
MS HIRST:We request that Mr Cummaudo complete his evidence if you don’t mind.
SENIOR MEMBER: Okay.
MS HIRST:And he will take a position at the back of the court.
SENIOR MEMBER: No, when you say complete his evidence have you got any more questions to ask him?
MS HIRST:No, I will not.
SENIOR MEMBER: Well, then there are no more questions and that’s the end - - and you are not calling any more evidence from your party?
MS HIRST:No.
In my view, these exchanges provide strong support for Comaz’s argument it was denied procedural fairness by the Tribunal’s continuing failure to facilitate, if not obstruct, the reasonable elucidation of its evidence. Had it been the case that the dismissive nature of the Senior Member’s exchanges with Ms Hirst, and in forcefully interrupting her while she was attempting to ask questions of Mr Cummaudo, were directed towards a legally-qualified advocate, it may nevertheless have been the position that such conduct would have led to a finding that the proceedings were tainted with a lack of procedural fairness. However, the fact that the advocate in question appears to have lacked any formal legal training only serves to exacerbate the position. One cannot helped but be left with a strong sense that what was generated by the Tribunal at the hearing was an atmosphere that greatly inhibited the advocate for Comaz from eliciting, or feeling able to elicit, evidence from Mr Cummaudo in the manner in which she may very well have intended, or indeed in a manner which may have provided much greater assistance to the Tribunal in that a more detailed and accurate account of the relevant events could have been provided. Nor can it be said that the apparent strength or weakness of either party’s case provides any justification or excuse for a judge or tribunal member to exhibit a determination to reject submissions foreshadowed, but not yet made and developed.[83] For these reasons, I find that the grounds for appeal on which Question Two relates are also made out.
Question Three – Whether the failure of the Tribunal Member to warn Comaz of the effect of the principle in Jones v Dunkel resulted in a lack of procedural fairness?
[83]Antoun v R (2006) 224 ALR 51 at 77, [86] (Callinan J).
The third question of law to be determined arises from the Senior Member’s failure to warn Comaz of the possible inferences which were open to the Tribunal to find under the principle in Jones v Dunkel[84] in regard to Comaz’s failure to call Mr Bruno Alderuccio to give evidence. It appears that Mr Alderuccio was the solicitor acting for Comaz at all relevant times in relation to the transaction the subject of the assessments. Mr Alderuccio did not give evidence, nor was he subpoenaed by either Comaz or the Commissioner. Given the fact that Comaz had no legal representation, the failure to warn it of the possible inference open to the Tribunal by not calling Mr Alderuccio in circumstances where his evidence may have been highly relevant, and where the Senior Member did in fact then apply the principle in Jones v Dunkel to the detriment of Comaz, amounted to a very significant denial of procedural fairness.
[84](1959) 101 CLR 298.
The application of the rule in Jones v Dunkel in the context of unrepresented parties was discussed recently by the Court of Appeal in Downes v Maxwell Richard Rhys & Co Pty Ltd (in liq),[85] where it was held that the trial judge had erred by not explicitly warning unrepresented defendants that a failure to call evidence might result in a judge adopting Jones v Dunkel inferential reasoning. The failure to do so in circumstances where the trial judge adopted that reasoning to the detriment of the unrepresented defendants in his judgment resulted in a denial of procedural fairness which could not be overcome even where the conduct of the trial judge to assist the unrepresented defendants was otherwise commended by the Court of Appeal.
[85](2014) 313 ALR 383.
After undertaking a review of the course of the hearing which was the subject of the appeal, Osborn JA said:[86]
[86](2014) 313 ALR 383 at 402 [99], [100].
Whilst it is true that his Honour went to substantial lengths to emphasise the difference between submissions and evidence as the matter progressed before him, the distinction was not reiterated at the critical point where the Downes elected not to give evidence and the judge did not identify or explain the consequences that might follow in terms of Jones[87] reasoning.
…
Unfortunately, his Honour’s statement ‘now you don’t have to give evidence if you don’t want to’ effectively invited the Downes not to give evidence but to rely on their submissions alone. This course could not fairly be suggested without raising for the Downes the significant evidentiary problems which I have identified above and the concomitant possibility that the failure to call evidence might result in the judge adopting Jones[88] inferential reasoning.
[87](1959) 101 CLR 298.
[88](1959) 101 CLR 298 at 312 (Menzies J).
A little later, his Honour continued:[89]
The Downes were not warned of a risk that a finding made on the basis of Jones v Dunkel reasoning might be made and were not given a proper opportunity to adduce evidence and make submissions rebutting such a potential adverse finding.
Putting these matters together, in my view, the Downes did not receive procedural fairness. Furthermore, it cannot be said that the trial judge’s conclusion was inevitable.
[89](2014) 313 ALR 383 at 403 [105]–[106].
In a separate judgment, Whelan JA said:[90]
However, notwithstanding the judge’s commendable efforts to ensure that the defendants were able to understand the process and make informed decision, ground 1 concerning the judge’s failure to warn them of the potential application of Jones v Dunkel must be upheld for the reasons given by Osborn JA. The defendants could not have known of, or anticipated, the application of those principle. Clearly, that possibility was relevant to their decision as to whether to give evidence. The judge did then apply those principles to the detriment of the defendants in his judgment.[91]
[90](2014) 313 ALR 383 at 405 [119].
[91]Reasons at [42]-[44].
As these extracts taken from Downes indicate, the trial judge in that case clearly went to some lengths to offer assistance, where appropriate and as far as possible, in recognition of the fact that the defendants were unrepresented. Despite the efforts to which the trial judge went, the failure to provide a warning regarding the effect of a Jones v Dunkel inference was an oversight which tainted the whole proceeding by failing to provide procedural fairness, an oversight which could not be overcome despite the best efforts of the trial judge in other aspects of the trial. The decision also provides a clear articulation of the important role the application of the rule in Jones v Dunkel plays in adversarial litigation, as well as the steps which a court and, in my view, a tribunal must take to assist an unrepresented party gain an understanding of the application of this rule and the potentially adverse consequences of its application. I will return to this issue of the appropriate limits to a court or tribunal’s assistance to unrepresented parties shortly.
It was made clear at the very early stages of the Tribunal hearing that a critical issue in these current proceedings was the time at which the contracts and the agency agreements were entered into and dated. During his opening submissions, counsel for the Commissioner said:[92]
But agency is certainly the core point, and we say that by the time we get to closing submission, the evidence will show that there is a very unsatisfactory basis for a finding of fact that the agency documents were entered into in August and November of 2002. That is bearing in mind the Applicant bears the burden of proof.
[92]VCAT Transcript, page 33 line 30 to page 34, line 4.
During the cross-examination of Ms Hirst at the Tribunal, the subject of the evidence with which Mr Alderuccio may have been able to assist on this important issue was again discussed:[93]
[93]VCAT Transcript, page 73, line 12 to page 74, line 27.
MR YOUNG: As far as you know have you, Mr Cummaudo or any of the companies of which you are a director or which you represent, brought any proceedings against Mr Alderuccio for negligence?
MS HIRST:No, I wouldn’t do so. By way of explanation, Bruno [Alderuccio] was a long-standing - - a long-standing friend who we have used as a solicitor but I would not place him in that position, although I probably would have been entitled to.
SENIOR MEMBER: Why haven’t you called him to give evidence today?
MS HIRST:Can I give an honest answer?
SENIOR MEMBER: Well I hope that all answers here are honest - -
MS HIRST:Okay because - -
SENIOR MEMBER: You are under oath so - -
MS HIRST:Because, basically, we had our own solicitor. We dismissed that and took over the case. I had very little time to - -
SENIOR MEMBER: He is clearly a man, these documents, you could give evidence as to when documents were signed and things like that - -
MS HIRST:Well, I merely assumed - -
SENIOR MEMBER: Why haven’t you called him?
MS HIRST:I didn’t want to be the party that called him. I really did anticipate I had run out of time just to do the witness statements and that SRO may have called him but didn’t want to be the party and put him under pressure, to be honest, and with respect to the delays between the orders, SRO responded one day before the third order expired. I ran out of time to lodge any further witnesses - -
SENIOR MEMBER: Well, did you ask for leave to lodge further witness statements?
MS HIRST:No. I’m satisfied to leave it. I believe that on the documentation here later on, there’s evidence that will show Bruno - - yes, we will leave it at that. We will come back to it.
MR YOUNG: Is Mr Alderuccio still a solicitor engaged by either you, Mr Cummaudo or any of the companies we are talking about?
MS HIRST:Well, not at present. There’s no matters at hand, no, but that doesn’t mean he wouldn’t be.
This exchange would seem to flow from an earlier exchange which seems to provide some context, namely, that Comaz did not think it necessary to call Mr Alderuccio because there was no issue with respect to whether or not he gave good legal advice:[94]
[94]VCAT Transcript, page 48, line 25 to page 49, line 31.
MS HIRST:No. I have not marked down Alderuccio as a witness because I do not wish to damage - -
SENIOR MEMBER: No, the question is more direct than that. You agree that it is irrelevant to this case whether or not you were given good legal advice?
MS HIRST:It’s irrelevant to the case, but the point is there. We could have avoided stamp duty totally - -
…
MR YOUNG: That’s apartments one and two in the development. Why did you enter those contracts of sale?
SENIOR MEMBER: Do I need to open those contracts?
MR YOUNG: Not yet.
SENIOR MEMBER: Thank you.
MS HIRST:Why, because we needed - - because there was a clear need to have contracts in place for presales. In other words, before the bank would finance presale - - before the bank would finance the development we had to have a certain percentage of presales. It was my anticipation that we would purchase those units for the future.
MR YOUNG: What do you mean by we, who is we? You are the person on the contract.
MS HIRST:Yes - -
The issue of Mr Alderuccio’s evidence seemed to shift in the second exchange, in terms of time (which is set out above), from the lack of any need to call Mr Alderuccio because no issue was being raised by Comaz in relation to the quality of his advice, to issues with respect to agency. This shift is quite clear once the agency appointment issue is raised later in cross-examination of Mr Cummaudo:[95]
[95]VCAT Transcript, page 97, line 27 to page 100, line 8.
MR YOUNG: 246. So, that’s an appointment of agent form, 20th of August 2002, not May, that you execute in relation to the purchase of shop C?
MR CUMMAUDO: Mm, mm.
MR YOUNG: All right, so what [sic] your evidence about this form?
MR CUMMAUDO: Well, you asked me why they purchased. Perhaps they purchased because I gave them an agent’s authority.
SENIOR MEMBER: Who drew this form?
MR CUMMAUDO: Sorry?
SENIOR MEMBER: Who drew this form?
MR CUMMAUDO: Sorry, sir.
SENIOR MEMBER: Who drew that form?
MR CUMMAUDO: Where did I get it from?
SENIOR MEMBER: Who drew it, yes.
MR CUMMAUDO: I assume the solicitor would have drawn that up.
SENIOR MEMBER: Who is that?
MR CUMMAUDO: Alderuccio.
SENIOR MEMBER: Is he giving evidence?
MR YOUNG: Can he give evidence?
SENIOR MEMBER: Is he going to give evidence?
MR CUMMAUDO: As far as - - - I’m not sure, no.
SENIOR MEMBER: Are you calling him?
MR CUMMAUDO: Sorry?
SENIOR MEMBER: Are you calling him? Are you calling him to give evidence?
MS HIRST:No - -
SENIOR MEMBER: No, you don’t look at - - just answer the question.
MR CUMMAUDO: We can call him if you like.
SENIOR MEMBER: Are you calling him?
MR CUMMAUDO: I did ask him to come along. And I can send you email that I recently sent him - -
SENIOR MEMBER: No, I just asked your [sic] question. Are you - -?
MR CUMMAUDO: I’m asking him to be a witness here, sir, but he hasn’t replied. He hasn’t replied to my email.
SENIOR MEMBER: Are you thinking of subpoenaing him?
MR CUMMAUDO: Well, it might be a good idea.
SENIOR MEMBER: Well, it’s a bit late now. Why didn’t you do it earlier?
MR CUMMAUDO: Well - -
SENIOR MEMBER: Because, you understand don’t you that there’s a - -
MR CUMMAUDO: We all - -
SENIOR MEMBER: Just one moment.
MR CUMMAUDO: Sorry.
SENIOR MEMBER: You understand there is a dispute as to the date that this appointment of agent was signed. Do you understand that?
MR CUMMAUDO: Yes, I do, yes.
SENIOR MEMBER: Well, surely he as the solicitor who drew it, his evidence would be pretty important wouldn’t it?
MR CUMMAUDO: I would say so.
SENIOR MEMBER: All right.
MR CUMMAUDO: I - - I would assume that the State Revenue Office as far as I know they’ve got this document here. They have subpoenaed two other witnesses. Why didn’t they subpoena - -?
SENIOR MEMBER: Well, he is your man.
MR CUMMAUDO: No, he’s not my man.
SENIOR MEMBER: Well, look, I’m not arguing with you - -
MR CUMMAUDO: [Inaudible] my man, too.
SENIOR MEMBER: All right - -
MR CUMMAUDO: [Inaudible] my man. Why hasn’t the State Revenue Office subpoenaed Bruno to get to the bottom of it?
SENIOR MEMBER: You understand that you have got the burden of proof, don’t you?
MR CUMMAUDO: I do can [sic] only go by that - -
SENIOR MEMBER: But you understand - - you know what that means?
MR CUMMAUDO: Yes.
SENIOR MEMBER: Yes.
MR CUMMAUDO: Well, that’s the proof there. I signed the document on that date. By the look of it I didn’t prepare it.
MR YOUNG: You signed the document on that day, that is your evidence?
MR CUMMAUDO: I didn’t prepare that document.
It is apparent from the exchanges which took place between the Senior Member and both Ms Hirst and Mr Cummaudo that the importance of the evidence which Mr Alderuccio may have been able to provide was a matter to which the Senior Member had turned his mind. It is also quite clear that the calling of Mr Alderuccio was something which had been contemplated by Comaz prior to the hearing at the Tribunal, but for reasons explained, albeit perhaps not completely satisfactorily, by both Ms Hirst and Mr Cummaudo, no such request or steps to subpoena Mr Alderuccio was made or taken. Despite this, nowhere during the course of the evidence is it explained to Ms Hirst or Mr Cummaudo – and in clear terms - the effect of the rule in Jones v Dunkel with respect to their failure to call Mr Alderuccio as a witness. The Commissioner submits that the issue was satisfactorily addressed in Commissioner’s closing submissions, where counsel for the Commissioner said to the Tribunal:[96]
[96]VCAT Transcript, page 279, lines 6 to 23.
Paragraph C, the Applicant’s failure to call Mr Alderuccio is also telling. He is a witness in the Applicant’s camp. He was their solicitor. It was certainly open for them to call him. Some explanation was given as to why that didn’t happen but if that wasn’t the case it was certainly open to him to be subpoenaed. No questions of privilege could have arisen because it’s the Applicant’s privilege and it’s up to the Applicant to weigh it if they were going to call upon him on his behalf. That failure is all the more telling when Mr Cummaudo constantly shifted blame to Mr Alderuccio. It’s really not good enough for the witness to shift the blame on to his solicitor and then not call that solicitor.
We say an inference should be drawn from that, that Mr Alderuccio would not have been able to give any relevant evidence that would have assisted the Applicant’s case.
Ms Hirst, in her closing submissions, responded:[97]
I wish to add another point there, too. The omission to call Mr Alderuccio wasn’t a deliberate oversight. It revolved around the period of time between when we took this case on personally ourselves, the lodgement of the initial witness statements, all of the - - there was an extension in time period for orders. Ms Chan will understand that she extended her order for provision of her witness and her documents, and that it ended, basically, I think one or two days before the final order. We omitted at the early stages to extend the time period for that last order to allow ourselves the opportunity to raise any further witnesses. So we basically did run out of time due to our own error and possibly if we had have understood we could have called Mr Alderuccio. But I’m very surprised that the Respondent, if they were so adamant in not accepting his correspondence as a legal person, that they didn’t call him to query its legitimacy.
Clearly, it was too late to cure the procedural deficiency with respect to the rule in Jones v Dunkel merely in closing submissions. Again, one comes back to the point that Comaz was not represented by a legally qualified representative, so one would not expect any understanding of the consequences of failing to have regard to the rule in Jones v Dunkel in the circumstances. Moreover, there is no suggestion that Ms Hirst or anyone else on behalf of Comaz appreciated that an application might have been made to re-open the proceedings following the Commissioner’s submissions with respect to the application of the rule in Jones v Dunkel in his closing submissions.
[97]VCAT Transcript page 294, line 6 to page 295, line 12.
The underlying principle behind the rule in Jones v Dunkel was articulated by McHugh J in Re Refugee Tribunal: Ex parte Aala, where his Honour said:[98]
One of the fundamental rules of the fair hearing doctrine is that a decision-maker should not make an adverse finding relevant to a person’s rights, interests or legitimate expectations unless the decision-maker has warned that person of the risk of that finding being made or unless the risk necessarily inheres in the issues to be decided. It is a corollary of the warning rule that a person who might be affected by the finding should also be given the opportunity to adduce evidence or make submissions rebutting the potential adverse finding.[99]
[98](2000) 204 CLR 82 at 121 [101] (McHugh J).
[99]Mahon v Air New Zealand Ltd [1984] AC 808 at 820-1.
As the Court of Appeal said in Downes, the requirements of procedural fairness must respond to the circumstances of the particular case in that the need to explain evidentiary rules and principles to a party in a particular case will depend upon the nature of that case and the course and conduct of the proceeding.[100] It is clear that the nature and outcome of the hearing at the Tribunal was very much predicated upon findings of fact on which Mr Alderuccio’s evidence may have shed considerable light. Where the credibility of Mr Cummaudo was called into question from the outset, the importance of calling evidence which may have supported, or detracted, from these findings (or rather, presumptions) in relation to credibility, is only heightened. It simply could not be expected that either Ms Hirst or Mr Cummaudo could fully appreciate the manner in which the failure to call Mr Alderuccio could potentially impact upon the outcome of their case, given their lack of knowledge regarding the intricacies and potentially significant consequences flowing from the application of the rule in Jones v Dunkel. The failure of the Tribunal to even attempt to clarify or explain the manner in which an inference may be drawn, and indeed was drawn, in regard to the failure to call Mr Alderuccio resulted in a breach of procedural fairness of a most serious kind. As I have indicated, any notion that such a defect could have been cured by counsel for the Commissioner merely raising the issue in closing submissions without any further steps being taken, such as advising Ms Hirst of the possibility of re-opening Comaz’s case to recall Mr Alderuccio, sorely misses the point. In many ways, the fact that the point was raised in closing submissions, and accepted by the Tribunal in its reasons, only serves to highlight how important the issue was to the conduct of the trial in a manner which provided procedural fairness. The course followed also raises some concern in relation to the conduct of the Commissioner as a model litigant – an important point I will consider in greater detail below. For these reasons, I find that Question Three of the Notices of Appeal is made out.
Question Four – Did the Tribunal fail to provide a fair hearing by receiving, and accepting, the evidence of Mr Frlan and Mr McCarthy?
[100](2014) 313 ALR 383 at 390 [27] Osborn JA) citing Kioa v West (1985) 159 CLR 550 at 584 (Mason J), 594 (Wilson J), 612-5 (Brennan J, 633 (Deane J).
Question Four relates to the leading of, and reliance upon, the evidence of Mr Frlan and Mr McCarthy, who were originally involved with Mr Cummaudo as directors of Roscon Developments Pty Ltd, the company established for the purpose of the development at 250-254 Chapel Street.[101] Mr Frlan and Mr McCarthy were also the principals of Rotalla Pty Ltd and Patessabby Pty Ltd, respectively, the companies which were listed as the purchasers for Shop C and Shop E. By January 2005, Mr Frlan and Mr McCarthy had exited their investments in the development.[102]
[101]Tribunal’s Reasons, [17].
[102]Tribunal’s Reasons, [27].
At the trial, neither party presented expansive submissions in relation to this question, preferring instead to rely mainly upon their written submissions filed previously in this Court. For Comaz, it was said to be unnecessary to explore the grounds of this aspect of the appeal in too great a detail, given that the nature of the breaches of procedural fairness in relation to the first three questions on appeal were of such a level to place the remaining questions to be decided as little more than peripheral considerations. [103] As I am inclined to agree with Comaz’s statements in relation to the position this question holds on this appeal - and in light of my previous findings in regard to Questions One to Three – Question Four requires only a relatively brief consideration. Moreover, there are aspects of this question which render it inappropriate for this Court to provide any substantive answer or answers, given the preceding reasons and my findings that these proceedings should be remitted back to the Tribunal to be heard before a different member.
[103]Transcript, page 48, lines 13 to 23.
The submissions in relation to this question from Comaz are twofold. First, the use of the evidence of Mr Frlan and Mr McCarthy in circumstances where no witness statements were provided led to a distinct disadvantage for Comaz, in that it was not given a reasonable opportunity to test the evidence. Secondly, had it been accepted by the Tribunal that agency agreements did exist as between Comaz and either, or both, Rotalla Pty Ltd or Patessabby Pty Ltd, either, or both, companies may have been liable under s 31(1) of the Duties Act 2000 - yet both Mr Frlan and Mr McCarthy were witnesses for the Commissioner. In these circumstances, and given that Comaz was unrepresented, it is submitted the Tribunal had a duty to explore the position of these witnesses to ensure a fair hearing. [104]
[104]Comaz’s Submissions, [92].
In relation to the first point, the Commissioner submits that there is no basis for this complaint, as both Mr Frlan and Mr McCarthy attended under a witness summons where sufficient notice was given that the Commissioner expected each witness to give evidence according to transcripts of interviews conducted by the Commissioner pursuant to s 73 of the Taxation Administration Act 1997; transcripts which indicated evidence surrounding their decisions to exit the development, as well as in relation to agency arrangements.[105] Given such notice, the Commissioner says there was ample opportunity to cross-examine each witness on their evidence. In addition, it is said by the Commissioner that the transcript of the interviews provided more information and detail than would otherwise have been provided in witness statements.
[105]Commissioner’s Submissions, [89].
The second point relates to the proper basis on which the assessments were made, and the effect such findings had, or should have had, on the manner in which the evidence of Mr Frlan and Mr McCarthy was accepted and utilised. While the proper basis for the assessments is also brought as a separate question on appeal in Question Five of the Notices of Appeal, it is appropriate that I make a number of comments concerning this ground at this time. The answer to whether s 31(3) of the Duties Act 2000 should have been considered as the proper basis for the assessments is one very much informed by whether agency arrangements existed in relation to any of the four transactions (other than the one in relation to Shop A). As the preceding reasons indicated, the question of whether such agency agreements existed was central to the proceeding, but was obfuscated by the continual and, at times, egregious failure to provide procedural fairness which permeated much of the Tribunal hearing. As I have now found that the proceedings should be properly remitted back to the Tribunal to be heard before another member, to make findings in relation to the manner in which evidence should be presented and accepted regarding issues which must be properly ventilated at the re-hearing would be an improper, and unjustifiable, interference with the Tribunal process. Accordingly, I make no finding in relation to Question Four.
Question Five – Did the Tribunal fail to perform its review functions by failing to consider the statutory basis for the assessments under the Duties Act 2000?
For the reasons which I have indicated previously in relation to Question Four and the manner in which the assessments under the Duties Act should be properly found, it is not appropriate that I make any findings in relation to this issue. Accordingly, I make no findings in relation to Question Five.
Question Six – Whether the Tribunal’s failure to assist the plaintiff as a self-represented litigant resulted in a breach of procedural fairness?
Question Six of the Notices of Appeal is couched in similar terms to Question One, in that Comaz submits that the Tribunal’s failure to provide it with assistance as an unrepresented litigant was in breach of s 97 or, alternatively, s 98(1)(a) of the VCAT Act or, alternatively, resulted in a denial of procedural fairness. As Question Two and Three as set out in the Notices of Appeal recognise, and as the preceding reasons in relation to those questions indicate, the Tribunal’s conduct in relation to Comaz as an unrepresented litigant colours a significant part of this proceeding. In my view, given the importance of the role courts and tribunals must play in ensuring access to justice and procedural fairness, as well as the considerable failings of the Tribunal on these matters in these proceeding, it is appropriate that the issue also be brought as a separate question on appeal.
A comprehensive review of the significance of the right to equality before the law and access to justice in terms of the duties of a judge in relation to assisting unrepresented litigants was undertaken by Bell J in Tomasevic v Travaglini,[106] where his Honour identified a number of the disadvantages suffered by unrepresented litigants. After stating the general principle that ‘courts possess all necessary powers to ensure a fair trial,[107] one aspect of which is the power to give assistance to a litigant in person’, his Honour went on to explain how the duty to provide such assistance can extend beyond the courts: [108]
As part of their overriding obligation to ensure a fair trial, trial judges have a positive duty to give proper assistance to self-represented litigants,[109] both in criminal[110] and civil[111] trials and also in interlocutory proceedings, such as in applications to strike out pleadings.[112] The same duty applies to masters,[113] magistrates,[114] commissions[115] and tribunals,[116] but of course the application of the duty would have to take into account the particular demands of those jurisdictions. The duty applies even when all the parties are litigants in person.[117]
[106](2007) 17 VR 100.
[107]Barton v R (1980) 147 CLR 75 at 96; cited in Dietrich v R (1992) 177 CLR 292 at 327
[108](2007) 17 VR 100 at 119 [89].
[109]The County Court of Victoria has produced an extensive report on assisting litigants in person: Self-represented Parties: A Trial Management Guide for the Judiciary (County Court of Victoria, 2004). His Honour noted he found the report invaluable and commended it to everybody interested in this subject.
[110]R v Nilson [1971] VR 853 at 864; Cooling v Steel [1971] 2 SASR 249 at 251; MacPherson v R (1981) 147 CLR 512 at 524, 534 and 546-547; R v Gidley [1984] 3 NSWLR 168 at 181; R v Zorad (1990) 19 NSWLR 91 at 100; Dietrich v R (1992) 177 CLR 292 at 327; R v White (2003) 7 VR 442 at 453-8; Pezos v Police (2005) 94 SASR 154 at 159-160; R v Kerbatieh (2005) 155 A Crim R 367 at 379-380; R v Rostom (2007) 98 SASR 528 at 536-8, [35]-[43].
[111]Abram v Bank of New Zealand (1996) ATPR ¶41-507 at 42,341 and 42,347; Rajski v Scitec Corporation Pty Ltd (New South Wales Court of Appeal, 16 June 1986, unreported (the relevant passages from the judgment are set out in Re Morton; Ex parte Mitchell Products Pty Ltd (1996) 21 ACSR 497 at 513-514); Andrew Garrett Wines Resorts Pty Ltd v National Australia Bank Ltd [2006] SASC 381, [54]; Uszok v Henley Properties (NSW) Pty Ltd [2007] NSWCA 31, [148]-[157] (Beazley JA, Basten JA concurring and Bryson JA dissenting); Barghouthi v Transfield Pty Ltd (2002) 122 FCR 19 at 23; Nagy v Ryan [2003] SASC 37 [39]-[46]; Panagopoulos v Southern Healthcare Network (Supreme Court of Victoria, Smith J, 15 September 1997, unreported, BC 9704538, 2); Zegarac v Tomasevic [2003] VSC 150, [3]; Minogue v Human Rights and Equal Opportunity Commission (1999) 84 FCR 438 at 445-447; Tobin v Dodd [2004] WASCA 288, [13]-[16]; Edwards v Olsen [2003] SASC 238, [204]-[209] (Full Court).
[112]Panagiotopoulos v Rajendram [2005] NSWCA 58, [33] and [35]-[36]; Tobin v Dodd [2004] WASCA 288, [13]-[14] and at [15]-[16]; ReMorton; Ex parte Mitchell Products Pty Ltd (1996) 21 ACSR 497 at 513-514; Wentworth v Rogers(No 5) (1986) 6 NSWLR 534, 536; Awan v Minister for Immigration and Multicultural and Indigenous Affairs (2002) 120 FCR 1 at 17.
[113]See, for example, Andrew Garrett Wines Resorts Pty Ltd v National Australia Bank Ltd [2006] SASC 381, [50]-[55].
[114]See, for example, Cooling v Steel [1971] 2 SASR 249 at 250-251; Black v Smith (1984) 75 FLR 110 at 112-113; Nagy v Ryan [2003] SASC 37, [39]-[46]; Pezos v Police (2005) 94 SASR 154, [8]-[20]; KC Nominees Pty Ltd v Arrowsmith (2006) 232 ALR 789 at 798, 806; Stock v Anning [2006] WASC 275, [54]-[58].
[115]See, for example, Davidson v Aboriginal and Islander Child Care Agency (1998) 105 IR 1 at 8-10 (Full Bench of the Australian Industrial Relations Commission).
[116]Santamaria v Administrative Appeals Tribunal [1998] VSC 107, [28].
[117]Zegarac v Tomasevic [2003] VSC 150, [3].
In Seachange, Acting President Judge Ross, discussed how the duty to assist unrepresented litigants operates upon members of the Tribunal:[118]
[118][2008] VCAT 1479, [58]-[59].
A member has a responsibility to ensure that the proceedings are fair. This means that in some circumstances a member has an obligation to intervene, both for the benefit of a litigant in person and more generally.
The assistance provided by a member may, depending on the circumstances, include:
·identifying the issues which are central to the determination of the particular proceedings.
·drawing a party’s attention to the relevant legislative provisions and key decision(s) on the issue being determined.
·asking a party questions designed to illicit information in relation to the issues which are central to the determination of the particular proceedings;
·assisting a party to conform to the Brown v Dunn principle and other procedural rules designed to avoid unfairness; and
·drawing a party’s attention to the relative weight to be given to Bar table statements as opposed to sworn evidence.
The Commissioner again notes in relation to this question that Comaz was not a ‘self-represented litigant’, but rather a party represented by its own choosing, albeit not a legal representative. As I have indicated previously, such classification neither assists the argument, nor absolves the Tribunal from its duty. The principles which courts have developed regarding the obligation to assist unrepresented litigants are founded upon fundamental human rights, as explained by Bell J in Tomasevic,[119] and have as their starting point the recognition that those appearing in legal proceedings, but not trained in the law, are often at a distinct disadvantage from a lack of professional skill and ability:[120]
By definition litigants in person lack the skills and abilities usually associated with legal professionals. Most significantly, lack of knowledge of the relevant law almost inevitably leads to ignorance of the issues that are for curial resolution for the court or tribunal… .This ranges from lack of knowledge of courtroom formalities, to a lack of knowledge of how the whole court process works from the initiation of a proceeding to hearing. Litigants in person also lack familiarity with the language and specialist vocabulary of legal proceedings.
[119](2007) 17 VR 100 at 112-5 [66]-[77].
[120]Litigants in Person Management Plans: Issues for Courts and Tribunals, Australian Institute of Judicial Administration Inc, (2001); cited in Tomasevic v Travaglini (2007) 17 VR 100 at 116 [81].
What a court, or tribunal, must do to assist an unrepresented litigant will vary depending upon the difficulties confronting the individual litigant, including the litigant’s intelligence and understanding of the case, as well as the nature of the case.[121] While the authorities make it clear that a judge or tribunal member should not intervene to such an extent that he or she cannot maintain a position of neutrality, the boundaries of legitimate intervention are flexible and will be determined by the need for appropriate intervention to ensure a fair trial.[122] Where a litigant or their representative has experience in litigation, or some other particular skill or experience which makes them less vulnerable to the disadvantages usually inherent in a litigant in person, the duty upon the court or tribunal to assist may be modified or reduced to take into account the particular circumstances. But to suggest that by virtue of the fact that a party may choose to have present an advocate to assist in the presentation of their case – one not legally qualified, but permitted under the rules of the court or tribunal – the protections granted to them are somewhat diminished, is to ignore the basic fundamental rights which a court or tribunal must strive, always, to protect.
[121]Abram v Bank of New Zealand (1996) 18 ATPR ¶41-507 at 43,341, 43, 347.
[122]Minogue v HREOC (1999) 84 FCR 438; Burwood Municipal Council v Harvey (1995) 86 LGERA 389.
The Commissioner submits that even if the Court finds that Comaz is properly classified as an unrepresented litigant, the Tribunal still has done enough to satisfy its duties to assist.[123] By explaining how the hearing would run,[124] answering questions from Ms Hirst about the process,[125] explaining matters such as the use of witness statements and whether or not statements made are in evidence,[126] as well as the giving of appropriate warnings to witnesses under s 105 of the VCAT Act, the Commissioner says the Tribunal was acting in a manner which was appropriate and intended to assist the plaintiff.[127]
[123]Commissioner’s Submissions, [111]-[114].
[124]VCAT Transcript, page 4, line 28 to page 5, line 9.
[125]VCAT Transcript, page 5, line 10 to 26.
[126]VCAT Transcript, page 8, lines 19 to 31; page 23, line 15 to page 24, line 9.
[127]Commissioner’s Submissions, [115].
The relevant aspect in these proceedings of an unrepresented litigant’s right to a fair trial is that they must be able to able to understand the bases on which they may contest evidence led against them, and the manner in which they might answer such claim by adducing evidence in response.[128] It is a balancing exercise as to how much assistance a judge, or tribunal member, is required to provide: [129]
[T]he advice and assistance which a litigant in person ought to receive from the court should be limited to that which is necessary to diminish, so far as this is possible, the disadvantage which he or she will ordinarily suffer when faced by a lawyer, and to prevent destruction from the traps which our adversary procedure offers to the unwary and untutored. But the court should be astute to see that it does not extend its auxiliary role so as to confer upon a litigant in person a positive advantage over the represented opponent…At all events, the absence of legal representation on one side ought not to induce a court to deprive the other side of one jot of its lawful entitlement…An unrepresented party is as much subject to the rules as any other litigant. The court must be patient in explaining them and may be lenient in the standard of compliance which it exacts. But it must see that the rules are obeyed, subject to any proper exceptions. To do otherwise, or to regard a litigant in person as enjoying a privileged status, would be quite unfair to the represented opponent.
[128]Downes v Maxwell Richard Rhys & Co Pty Ltd (in liq) (2014) 313 ALR 383 at 389, [22].
[129]Rajski v Scitec Corporation Pty Ltd (Unreported, NSWCA, Samuels JA, 16 June 1986), 72, quoted with approval by the Full Court of the Federal Court in Minogue v HREOC (1999) 84 FCR 438 at 446 [29]; cited in Downes (2014) 313 ALR 383 at 389 [23].
It is correct to say that at times during the course of the Tribunal hearing – particularly early in the proceedings – attempts were made to ensure that Ms Hirst had at the very least a rudimentary understanding of the nature of the proceedings, and some of the legal and procedural issues which arose. After Ms Hirst had been giving evidence for some time, some confusion arose as to the importance of a factual error made in early correspondence between Comaz and their lawyers, leading the Senior Member to make the following remarks.[130]
[130]VCAT Transcript, page 64, line 25 to page 65, line 19.
SENIOR MEMBER: But I am concerned about this because you are appearing for the company and it seems to me you are showing a misunderstanding of the whole case.
The case is in relation --- apart from Shop A, is that the properties that were transferred, were transferred pursuant to the contract made after the property was already developed, and therefore the development should be taken into account for stamp duty. Now, whether the original owner of the property was Roscon Pty Ltd, or Roscon Developments, makes no difference to that issue ---
MS HIRST: Well ---
SENIOR MEMBER: Now, if I’ve got that issue wrong, Mr Young, please correct me.
MR YOUNG: No, that’s exactly right.
MS HIRST: I’m sorry, but you can’t state that Roscon ---
SENIOR MEMBER: Well, I’m concerned that you are misunderstanding the case, because you are representing the company ---
MS HIRST: I agree ---
SENIOR MEMBER: I think it’s very important that you should understand the case that’s been put against the company, and I think you are showing that you really misunderstanding the whole thing because it matters not for the purpose of this case who the vendor or was whether it was Roscon or Roscon Development Pty Ltd
Shortly after this exchange, the Senior Member again to provide some assistance to Ms Hirst by again attempting to explain what was a central issue:[131]
SENIOR MEMBER: I think I should perhaps try to explain to you as best I can about the law of agency, and that is this: if the principal --- sorry, if the third party knows that there is a disclosed agency the agents can’t be liable. It is only when the third party is unaware of the disclosure of the agency that the agent can be liable. Now, I think that’s put fairly simply but I think it’s a fair statement. In this particular case is what you’re saying that Comaz didn’t know anything about the agency---?
[131]VCAT Transcript, page 66, lines 8 to 27.
It would seem that, having a regard to the authorities, the approach taken by the Senior Member in this exchange to which I have just referred provided, or at least attempted to provide, an explanation to Ms Hirst in a manner which offered some assistance without encroaching upon the limit at which it could be said ‘to confer upon a litigant in person a positive advantage over the represented opponent’. The comments by the Senior Member were made, presumably, with the intent of clarifying to Ms Hirst one of the central issues in the proceedings, while comments made earlier at the Tribunal hearing by the Senior Member were also designed to overcome any deficiency in Ms Hirst’s knowledge of procedural and, to a degree, evidentiary matters. Nevertheless, the duty to assist an unrepresented litigant is an ongoing one which must continue throughout the course of the proceeding; the effect of actions which may indeed be commendable in the assistance they provide can be quickly negated where a judge or a tribunal member does not maintain the high standard which is expected, as is made clear by the decision in Downes. While the Senior Member did make attempts to ensure Ms Hirst understood the proceeding, at least at the initial stage of the hearing, the assistance which was provided was soon diminished significantly by virtue of the conduct to which I have previously referred in relation to the other questions on appeal – most notable being the Tribunal’s lack of providing, or attempting to provide, an explanation of the principle in Jones v Dunkel and the manner in which it may have affected Comaz’s case. For these reasons. I find that Question Six is made out.
Model Litigant Guidelines
During the course of the hearing I asked the question, in relation to the discussion on the principle in Jones v Dunkel, as to whether the Commissioner, as a model litigant, should have been expected to intervene at some point during the course of the Tribunal hearing to draw to the attention of the Senior Member, Ms Hirst or Mr Cummaudo, the potentially serious consequences which may have resulted from Comaz’s failure to call Mr Alderuccio as a witness.[132] Shortly after this, a brief discussion ensued in relation to the responsibilities of the Commissioner as a model litigant and as to whether a higher standard of conduct should be expected.Upon this question, I invited the parties to make written submissions as to the relevance of the Model Litigant Guidelines to these proceedings. No such submissions were forthcoming from Comaz, while the Commissioner filed, one day after the hearing, brief submissions to which I will refer in greater detail shortly.
[132]Transcript, page 104, lines 22 to 27.
Before doing so, there are a number of observations regarding the Model Litigant Guidelines which should be made here given the seriousness of the deficiencies of the Tribunal hearing, which led to a distinct absence of procedural fairness during that hearing. While these breaches were largely a result of the actions, or inactions, of the Senior Member, the conduct of the Commissioner in light of the Model Litigant Guidelines also requires comment given the nature and conduct of the proceedings and, in particular, the fact that Comaz had no legal representation.
The Model Litigant Guidelines were introduced into Victoria in 2001, with the current version being in operation since 2011, and are largely based on the provisions issued by the Commonwealth Attorney-General.[133] While the obligations recognised by the Court with respect to such guidelines are perhaps not yet settled, the general nature of these obligations appears from the following passage in Scott v Handley:[134]
[133]See Note 3 to the Model Litigant Guidelines. Similar provisions exist In New South Wales, South Australia and Queensland.
[134](1999) 58 ALD 373.
The second respondent is, as we have noted, an officer of the Commonwealth. As such he properly is to be expected to adhere to those standards of fair dealing in the conduct of litigation that courts in this country have come to expect – and where there has been a lapse therefrom, to exact – from the Commonwealth and from its officers and agencies. The spirit of this ‘model litigant’ responsibility, now long enshrined in a policy document of the Commonwealth, is perhaps best captured in the observations of Griffith CJ in Melbourne Steamship Co Ltd v Moorehead:[135]
[135](1912) 15 CLR 333 at 342.
I am sometimes inclined to think that in some parts – not all – of the Commonwealth, the old-fashioned traditional and almost instinctive, standard of fair play to be observed by the Crown in dealing with subjects, which I learned a very long time ago to regard as elementary, is either not known or thought out of date, I should be glad to think that I am mistaken.
…
As with most broad generalisations, the burden of this fair dealing standard is best appreciated in its particular exemplifications in individual cases. The courts have, for example, spoken positively of a public body’s obligations of conscientious compliance with the procedures designed to minimise cost and delay and of assisting ‘the court to arrive at the proper and just result’. And they have spoken negatively, of not taking purely technical points of practice and procedure; of not unfairly impairing the other party’s capacity to defend itself; and of not taking advantage of its own default.
The Model Litigant Guidelines have evolved from the recognition at common law that governments should play fairly, and seek to bridle excessively adversarial behaviour by setting acceptable standards and boundaries for the conduct of litigation.[136] It has been said that the guidelines reflect the expectations citizens have of their government and its agencies to respect the rule of law, to observe the spirit as well as the letter of the law, and to be fair, honest and even-handed when dealing with members of the public.[137]
[136]Australian Productivity Commission, Access to Justice Arrangements, No. 72, 5 September 2014, page 429.
[137]Ian H. Gibson, ‘Model Litigant Guidelines – Current and Emerging Issues’ Paper presented at the Legalwise Seminar, 18 March 2015.
There are a number of policy considerations behind the reasons for governments and their agencies to act as model litigants, including the inherent power of government; the need for government and its agencies to act in the public interest, rather than holding any legitimate private interest in the outcome of litigation; the large quantity of resources at the government’s disposal; and the importance of having the government and its agencies set benchmarks for behaviour and appropriate conduct across the legal system.[138]
[138]Australian Productivity Commission, Access to Justice Arrangements, No. 72, 5 September 2014, pages 430-431.
In Morley v ASIC,[139] ASIC had failed to call as a witness the solicitor who had acted for the company and attended the meeting which was central to the evidence in the proceeding. In finding that ASIC had a duty of fairness to present all material evidence necessary to assist the Court, the New South Wales Court of Appeal made the following observations:[140]
The starting point for any such consideration in the context of enforcement proceedings by a regulatory agency, as distinct from proceedings in which a government corporation may have some commercial interest, is the recognition that the government agency has no legitimate private interest of the kind which often arises in civil litigation. It acts, and acts only, in the public interest as identified in the regulatory regime.
In such a context the usual rules and practices of the adversary system may call for modification. The most significant modification, likely to be true of most regulatory regimes, is that the public interest can only be served if the case advanced on behalf of the regulatory agency does in fact represent the truth, in the sense that the facts relied upon as primary facts actually occurred. It is not sufficient for the purposes of, at least, most regulatory regimes that, in accordance with civil laws of evidence and procedure in an adversary system, one party has satisfied the court of the existence of the relevant facts. The strength and quality of the evidence advanced on behalf of the State is a material consideration, which has received acknowledgement in the case law.
[139](2010) 274 ALR 205.
[140](2010) 274 ALR 205 at 335-6 [716]-[717].
After discussing the role the ASIC plays in relation to the administration of the laws of the Commonwealth and the wide-ranging powers which are conferred upon it, the Court said:[141]
The cumulative effect of all these matters is that ASIC cannot be regarded as an ordinary civil litigant when it institutes proceedings. This is so particularly for proceedings of the character before this Court. No other person could have brought these proceedings. In partial answer to the first of the questions, whether its failure to call a witness can constitute a breach of the obligation of fairness, in our opinion it can.
[141](2010) 274 ALR 205 at 339 [728].
The comments of the New South Wales Court of Appeal in this instance related to ASIC’s failure to call a witness from which the Jones v Dunkel inference was applied against their case. These comments are equally applicable, in my view, to a scenario where a party whose conduct must adhere to the Model Litigant Guidelines attempts to take advantage of another party’s failure to call a material witness to an issue which they themselves have identified as being central to the proceedings, particularly in circumstances where the other side has no legal representation. As the New South Wales Court of Appeal made clear, a government agency should not ordinarily be seen to have any legitimate private interest in civil litigation. Rather, the role of a government agency in litigation – absent any legitimate commercial interest in the outcome – is to ensure that all the relevant material is brought before the court or tribunal to ensure that a decision informed by all of the evidence is reached. Where, as in these proceedings, it was readily apparent that evidentiary material crucial to the outcome of the case was absent from the Tribunal hearing due mainly to an unrepresented litigant’s failure to appreciate the importance such evidence had to the proceedings, it should be seen as being incumbent upon a party who is subject to the Model Litigant Guidelines to ensure the other side is made aware that the evidence should be called, even in circumstances where the court or tribunal has failed to do so. Having failed to act to ensure that all the evidence was presented in these circumstances, the least which should have been expected is that the Commissioner would have refrained from relying on technical rules of evidence or procedure to gain a forensic advantage. That such restraint was not exercised, but rather a Jones v Dunkel inference sought and relied upon, must, in my view, be seen as a serious breach of the Model Litigant Guidelines, both in letter and spirit.
By the supplementary submissions to which I have referred earlier filed after the hearing and at the Court’s invitation, the Commissioner contends that the questions of law and grounds of appeal raised in these proceedings concerned the obligations owed by the Tribunal to Comaz.[142] It is said that none of the obligations concern anything owed by the Commissioner, whether pursuant to Model Litigant Guidelines or otherwise, so that questions about any such obligations do not arise for decision in these proceedings. Further, it is said that beyond merely making a reference to the Model Litigant Guidelines, Comaz has not identified what the content of the Commissioner’s obligations were said to be, to whom it is said they were owed, nor how the obligations interact with the Tribunal’s fair hearing and procedural fairness obligations or what the consequences of any alleged non-compliance with the Model Litigant Guidelines might mean. These questions raised by the Commissioner fail to grasp, in my view, the manner in which the guidelines should be seen to operate. It is not simply at the request or direction of another party upon which the obligations come into effect; they exist and are applicable at all times, requiring a party upon whom the obligations lie to conduct themselves in a manner above what may be expected from other litigants due to the policy considerations to which I have referred earlier.[143] And while the introduction of the Civil Procedure Act 2010 has raised the acceptable standard of conduct expected of all participants in civil litigation in this State, this development should not be seen as diminishing the effect of the Model Litigant Guidelines. Parties upon whom these obligations fall must continue to conduct themselves in a manner which recognises the imbalances the guidelines have sought to address.
[142]Commissioner’s Supplementary Submissions dated 30 April 2015.
[143]See above, [75].
Disposition of the appeal
For the preceding reasons, these proceedings should be remitted to VCAT for re-trial on all issues before a different Tribunal member. The parties are to bring in orders to give effect to these reasons.
The question of costs is reserved.
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