Consolidated Press Holdings Ltd v Commissioner for Taxation

[1995] FCA 223

IN THE FEDERAL COURT OF AUSTRALIA )
  )
NEW SOUTH WALES DISTRICT REGISTRY )    No.  NG 122   of  1995
  )
GENERAL DIVISION                 )

BETWEEN:CONSOLIDATED PRESS HOLDINGS LTD & ORS

Applicant

AND:COMMISSIONER FOR TAXATION & ANOTHER

Respondent

27 MARCH 1995

REASONS FOR JUDGMENT
LOCKHART J.
     This is a motion by the applicants seeking various orders.  I have already given the applicants leave to file a notice of motion in court returnable instanter.  The applicants seek leave to amend further their amended application, but the two principal matters that have been debated this morning are: whether the applicants should have leave to join further parties, named in the further amended application as Ferrier Hodgson and Peter Walker, as the third and fourth respondents respectively; and whether the applicants should have leave to interrogate the respondents, including the additional respondents if they are added.

Some recitation of the background of the matter should be given. The matter is of fairly recent origin, and indeed the very nature of the matter shows that it was obviously one of importance and urgency. For example, the applicants seek a declaration that conduct of the Commissioner and his officers, and officers of the Australian Government's solicitor, has contravened section 16 of the Income Tax Assessment Act 1936, the essence of that provision being, what is generally referred to as, the secrecy provision. The conduct sought to be impugned is that of divulging or communicating to a partner in a firm of chartered accountants information respecting the tax payer's affairs.

The matter came before another judge of the court for interlocutory relief which was granted on 15 March last.  I need not refer to the material that was before his Honour, Whitlam J. I have read his reasons for judgment and the orders which he then made.  His Honour made orders on the day following his reasons for judgment being given, that is on 16 March, in which directions were given to prepare the case for hearing to commence as an expedited matter on 5 April next, that is Wednesday of next week.  The directions were as to discovery and inspection of documents and to the filing of further affidavits, if any, by the applicants; and to the filing by the Commissioner and the Australian Government's solicitor, of any further affidavits on which they propose to rely.

The time table was a very tight one.  The applicants, I have been informed, will be complying with their direction as to the filing of affidavits by the end of today and discovery and inspection have been completed.  It remains therefore for the Commissioner and the Australian Government's solicitor to file and serve their affidavits by the time limited by Whitlam J, that is by 31 March next, Friday of this week.

I shall turn first to the question of whether the applicants should have leave to join the additional respondents, Messrs. Ferrier Hodgson and Mr Peter Walker.  The matter came in to the list this morning at a quarter past 10 and I stood the matter down so that the legal representatives of the parties could discuss the matter, and also so that the applicants could contact the proposed respondents, Ferrier Hodgson and Peter Walker, to see if discussions could resolve any of the issues between them.  In the result, those additional prospective parties have been represented before the court this morning by Mr Chapple.  The only relief that it is sought against Ferrier Hodgson and Mr Walker, is an order that they deliver up to the Commissioner all documents, papers and materials coming in to their possession or bought in to existence since 13 January this year containing information respecting the applicants' affairs and or copies of such documents.

I should add that the discussion between Mr Griffiths who appears for the applicants and Mr Chapple, has made it clear that although the prospective third respondent is Ferrier Hodgson, it is intended that partners of that firm in Sydney are contemplated and that is how the matter is to be approached. 

On the question of a joinder, one must bear in mind that this is a matter that has been approached as a matter or urgency by all parties and by the court, and that a hearing date of 5 April was fixed.  There was then no mention made to the judge, Whitlam J, about prospective interrogatories or indeed about prospective joinder of Ferrier Hodgson and Mr Peter Walker.  Indeed, from what I have been told from the bar table (and this has not been denied), the applicants in fact had previously considered the question of joining Ferrier Hodgson but had taken the step of deciding at an earlier time not to join them, that is in the light of what counsel then appearing for the applicants said to Whitlam J on some occasion earlier this month.

There has obviously been a change of thinking on the part of the applicants or their legal advisers and I fully understand that this occurs in the course of litigation.  The fact remains, however, that when a matter is of urgency and time tables have been set, parties cannot simply chop and change their tactics, unless some serious defect in their preparation of the case or in the issues has become manifest, which in my opinion it has not, at this stage.  There is, I think, some real threat that the hearing date would be in jeopardy if the relief sought in the motion is granted to the applicants and indeed that is asserted by Mr Catt, who appears for the Commissioner and the Australian Government's solicitor.

I am somewhat at a loss to see really what in substance is achieved by joining Ferrier Hodgson and Mr Walker as respondents, given that the only relief that is sought against them is order 5A which I have recited already. A subpoena to them would, I would have thought, produced the requisite material just as easily, or indeed almost as easily, as would they being here as parties.  The impression I have is that the real reason for seeking to join them is to interrogate them in the form of the interrogatories which have been annexed to the notice of motion which is before the court today and I will say something about that in a moment.

I should add that the time table which was endorsed by Whitlam J on 16 March last was one that, if not by consent, was certainly one that was not opposed, and it seems from what has been said to me and from my brief perusal of the papers, that in the result the orders really were by consent or at their very lowest, not without any opposition to them and in consequence, the very tight time table to which I have referred was set. 

I turn then to the interrogatories that have been annexed to the motion so that the parties can see clearly what it is sought to be the subject matter of the interrogatories. This course was very properly taken by the applicants. 

It is, I think, really sufficient that I look simply at the first of the four sets of interrogatories, that is those to the first respondent, because the substance of what is sought in the different sets of interrogatories is much the same. The interrogatory numbered one I need not set out in its terms. Mr Catt has informed me, and I see no reason not to accept what I have been told based on his instructions, that the ambit of the material sought in prospective interrogatory one is very wide indeed. It would embrace, not only matters directly relevant to the present proceedings, but also Freedom of Information Act proceedings the applicants have brought against the Commissioner; together with certain objections to decisions of the Commissioner, and other proceedings, and certain application for remission of interest under section 17AA of the Assessment Act.

So, the range of matters which would be embraced by order one in its present form, seems to me to be very wide. Indeed much of it may have no direct relevance to the present proceeding.  Also, I do have a doubt as to whether the interrogatories, if administered and given, would assist the applicants to proceed better with their case, than they would otherwise obtain by the proceeding in its present form.  There has been discovery of documents, and that is in accordance with the orders that have been made by the court thus far, and I doubt really if interrogatories will add much to the material that will be before the court in any event on 5 April.

Interrogatory number 2 is really the reverse side of the coin so as far as interrogatory 1 is concerned.  It is open to the same problems and objections as interrogatory number 1, together with the additional problem that I am not yet persuaded that what is sought in interrogatory 2 is relevant so far as issues between the parties are concerned.  It may be that if the interrogatory point arises again in the future I could be persuaded otherwise.

Therefore, I am not persuaded at this stage that a case has been made out for giving leave to join Messrs. Ferrier Hodgson and Mr Walker, or for administering interrogatories to any of the parties who are presently parties or those who are prospective parties.  So, I decline to grant the relief in respect of those two matters.

The motion also seeks leave to amend the application in other respects that are not directly relevant to the questions of interrogatories and joinder of parties and the position may well be different there so far as the right to the applicants to amend their application is concerned.  I have not heard argument on that but I am happy to do so.
     Insofar as the notice of motion seeks to join Messrs. Ferrier Hodgson and Mr Walker as respondents and to interrogate them and the first and second respondents, the motion is dismissed.  I think it is appropriate that the applicants pay the costs of Messrs. Ferrier Hodgson and Mr. Peter Walker of their appearance today to resist the motion.

I think the fair order for costs in relation to the motion is that the costs of the respondents of today's motion be paid by the applicants.  The court makes that order.

I certify that this and the preceding seven (7) pages are a true copy of the reasons for judgment herein of the Honourable Justice Lockhart.

Associate

Dated:  27 March 1995

Counsel for the Applicant    :        Mr. John Griffiths

Solicitors for the Applicant :        Gilbert & Tobin

Counsel for the Respondents  :        Mr. S. Catt (1R)
  Mr. Chapple (3&4R)

Solicitors for the Respondents:      Australian Government   Solicitors

Date of Hearing             :        27 March 1995
Date of Judgment            :        27 March 1995