Deputy Commissioner of Taxation v Binetter

The case of Deputy Commissioner of Taxation v Binetter involved an application to discharge freezing orders that were made ex parte by a judge of the Court on 20 June 2013 in proceedings initiated by the Deputy Commissioner of Taxation against Gary and Debbie Binetter. The basis for the application was that the judge was not fully informed about the fact that the notices of assessment had not matured at the time of the hearing. The Binetters argued that the notices had been posted the day before the hearing and were unlikely to have been delivered in the ordinary course of post by the time the judge was dealing with the matter. This was a significant point because, according to Kitto J in Batagol v Federal Commissioner of Taxation, a notice of assessment needs to mature in a certain way to have legal effect.

The legal issues the court needed to decide were whether the Commissioner had fulfilled his duty of full and frank disclosure and whether the unserved assessments were an inchoate debt that would have been due and payable shortly after the hearing. The Binetters argued that the Commissioner had not fully disclosed the inchoate nature of the unserved assessments, which was a breach of his duty of disclosure on an ex parte application. The court had to consider whether the Commissioner's failure to highlight the inchoate nature of the assessments would have made a difference to the judge's decision to grant the freezing order.

The court found that the Commissioner's duty of full and frank disclosure was of fundamental importance in the administration of justice. However, the court did not believe that the Commissioner's failure to highlight the inchoate nature of the assessments would have made any difference to the judge's decision. The court concluded that the claims on the amended notices of assessment that had been issued were justiciable in the Court and constituted a good prospective cause of action. The fact that the assessments may not have been served as at the time of the hearing was not of material relevance to the judge's decision to grant the freezing order. The court dismissed the interlocutory application and ordered the Binetters to pay the Commissioner's costs.

In summary, the court found that the Commissioner had fulfilled his duty of full and frank disclosure and that the unserved assessments were not an inchoate debt that would have been due and payable shortly after the hearing. The court dismissed the Binetters' application to discharge the freezing orders and ordered them to pay the Commissioner's costs.