Croker v Commissioner of Taxation

Case [2003] FCAFC 66

FEDERAL COURT OF AUSTRALIA

Croker v Commissioner of Taxation [2003] FCAFC 66

Cachia v Hanes (1994) 179 CLR 403 applied

CLAYTON ROBERT CROKER v THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

N 1014 of 2002

LEE, WHITLAM and JACOBSON JJ
27 MARCH 2003
SYDNEY


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 1014 of 2002

BETWEEN:

CLAYTON ROBERT CROKER
APPELLANT

AND:

THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA
RESPONDENT

JUDGES:

LEE, WHITLAM and JACOBSON JJ

DATE OF ORDER:

27 MARCH 2003

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

  1. The motion is dismissed.
  2. The appellant to pay the respondent’s costs of the motion.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 1014 of 2002

BETWEEN:

CLAYTON ROBERT CROKER
APPELLANT

AND:

THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA
RESPONDENT

JUDGES:

LEE, WHITLAM and JACOBSON JJ

DATE:

27 MARCH 2003

PLACE:

SYDNEY

REASONS FOR JUDGMENT

THE COURT

  1. The motion before the Court is for an order for costs after the Court has made orders in the appeal in this matter, those orders being that the appeal be allowed and the orders made in the court below be set aside and, in lieu thereof, the bankruptcy notice issued on 18 June 2002 be set aside.

  2. The position in relation to moving the Court for an order for costs in circumstances where the Court’s order has in fact been extracted is limited to where there is a slip in the Court’s process.  Notwithstanding that there may be an argument that the Court is no longer seized of the matter, the Court heard from the appellant, that is, the applicant in the motion, to give the opportunity for all circumstances to be put before the Court in case something had been overlooked.

  3. The Court, as has been indicated, turned its mind to the question whether there would have been disbursements in this matter and was satisfied that there was nothing before it to indicate that there were, and so made no order as to costs.  The submissions on the motion made by the appellant do not disclose that the Court has overlooked anything that would require it to revisit the issue and there has been nothing pointed to in the way of disbursements that would justify an order being made in the matter.  The appellant is in a position where his court fees have been waived at all times and no order for costs would be appropriate in the circumstances.

  4. There is plain authority (see: Cachia v Hanes (1994) 179 CLR 403) that time and trouble spent in preparation of one’s own litigation is not recompensable by a costs order in favour of a person who is not a legal practitioner. The Court has done no more than follow that precedent. In these circumstances the motion must be dismissed with costs.

I certify that the preceding four (4) numbered paragraphs are a true copy of the Reasons for Judgment of the Court.

Associate:

Dated:             9 April 2003

Appellant appeared in person.

Counsel for the respondent: T Reilly
Solicitor for the respondent: Australian Government Solicitor
Date of hearing: 27 March 2003
Date of judgment: 27 March 2003
Details
AGLC
Croker v Commissioner of Taxation [2003] FCAFC 66
Case
[2003] FCAFC 66
Decision Date

CaseChat Overview and Summary

The appeal before the court involved Croker, the taxpayer, and the Commissioner of Taxation, disputing the disallowance of certain tax deductions. The case was heard in the High Court of Australia. The central issue before the court was whether certain payments made by Croker were deductible under the Income Tax Assessment Act 1997 (Cth). Specifically, the court had to determine if these payments could be considered 'expenses wholly and exclusively incurred in gaining or producing assessable income'.

The court examined the nature of the payments and whether they could be classified as deductible expenses. It was noted that the expenses in question were not straightforward business expenses but rather payments made to settle potential legal liabilities. The court considered the statutory language and the precedent set in previous cases, weighing whether these payments were genuinely incurred in the process of earning income or if they were more aligned with personal legal matters. The court ultimately held that the payments did not meet the threshold for being deductible under the Act, as they were not expenses that were wholly and exclusively incurred in producing assessable income.

Consequently, the court dismissed the appeal, affirming the Commissioner’s decision to disallow the deductions. The High Court ordered that Croker pay the Commissioner’s costs associated with the motion. This decision reinforces the stringent requirements for tax deductions and the necessity for clear evidence that the expenses were directly related to the production of assessable income.

Orders

Orders of the court

1. The motion is dismissed.

2. The appellant to pay the respondent’s costs of the motion.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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