Elia and Inspector-General in Bankruptcy

[2021] AATA 3639

Elia and Inspector-General in Bankruptcy [2021] AATA 3639 (4 October 2021)

Division:TAXATION AND COMMERCIAL DIVISION

File Number(s):      2020/1264

Re:Albert Elia

APPLICANT

AndInspector-General in Bankruptcy

RESPONDENT

Decision

Tribunal:The Hon. Matthew Groom, Senior Member

Date:4 October 2021

Place:Melbourne

The decision under review is affirmed.

................................[SGD]........................................

The Hon. Matthew Groom, Senior Member

Catchwords

BANKRUPTCY – Inspector-General’s refusal to review income assessment of trustee in bankruptcy – lack of information provided by applicant led to Inspector-General being in no better position than the trustee to make an assessment  – consideration of reasons sufficient to justify review - consideration of applicant’s explanation for payments received – consideration of supporting witnesses and documentary evidence – decision under review affirmed.

Legislation

Bankruptcy Act 1966 (Cth)

Cases

Aston v Barnet in her capacity as the Trustee of the Property of Aston [2019] FCCA 2523

Lavin and Inspector-General in Bankruptcy [2017] AATA 890

REASONS FOR DECISION

The Hon. Matthew Groom, Senior Member

4 October 2021

INTRODUCTION

1. This matter involves the review of a decision made by a delegate of the respondent on 3 February 2020 pursuant to section 139ZA(1)(b) of the Bankruptcy Act 1966 (the Act).

2. The applicant became a bankrupt on 2 February 2017. Mr Robert Scott Woods was appointed Trustee in Bankruptcy (the Trustee).

3. On 22 October 2019 the applicant was assessed by the Trustee for an income contribution liability in respect of contribution assessment periods (CAPs) 1,2 and 3 being collectively for the period from 2 February 2017 to 1 February 2020 (relevant period). The income contribution liability was determined to be, in total, the sum of $119,134.05 (Trustee’s decision).

4. The Trustee determined the income contribution liability on the basis of what he described as being “significant and regular” payments into a Commonwealth Bank account in the name of the applicant from a Commonwealth Bank account in the name of International Catering Services Pty Ltd (ICS) as well as from the applicant’s daughter Shaye Elia (SE).

5. The Trustee estimated that the total amount of the payments during the relevant period was $413,261.10.

6. In assessing the income contribution liability, the Trustee formed the view that the applicant was acting as a shadow director of ICS or was otherwise an employee of ICS with management responsibility. The Trustee also formed the view that the payments from ICS and SE into the applicant’s account was “income” for the purpose of calculating the applicant’s income contribution liability in accordance with the Act.

7. ICS operated a catering business which provided catering services to RusCare Ltd (RusCare) pursuant to a catering services contract (the business). RusCare is a community aged care service provider based in Victoria. RusCare was ICS’s sole client. Father Michael Protopopov (Father Michael) is the director of RusCare. Father Michael is the applicant’s former father in law. The applicant’s son, John Elia (JE), is the sole director of ICS. ICS was incorporated following the deregistration of a previous company, Al’s Catering Pty Ltd (Al’s Catering), of which the applicant had been a director and which had previously been the provider of catering services to RusCare. Following the deregistration of Al’s Catering, the RusCare catering services contract had been retendered and ICS was awarded the contract.

8. On 2 September 2019, correspondence on behalf of ICS was sent to the Trustee by the applicant’s legal representative (who, in addition to acting for the applicant, has also acted for ICS as well as JE). In that correspondence the applicant’s legal representative advised that he was instructed that the applicant was not an employee of the business but that the applicant did provide ad hoc, voluntary, assistance to JE to assist with the business such as attending shopping in respect of which the applicant received no benefit other than reimbursement for shopping undertaking on behalf of the business.

9. On 13 November 2019, the applicant’s legal representative sent a further letter to the Trustee on behalf of the applicant in which he advised that the applicant was in receipt of a pension in the sum of approximately $860 per month and no other income. The applicant’s legal representative also advised that the applicant denied being a shadow director of ICS.

10. On 3 December 2019 the applicant, through his legal representative, requested that the respondent undertake a review of the Trustee’s income contribution liability assessment pursuant to section 139ZA(3) of the Act.

11. On 17 December 2019 the Trustee forwarded a number of documents to the respondent that the Trustee had relied on in undertaking his assessment. Those documents included:

    (a)statements and a list of transactions for Commonwealth Bank account in the name of Albert Elia, for the period 29 November 2016 to 7 June 2019;

    (b)a list of transactions for Commonwealth Bank account in the name of ICS, for the period 30 November 2015 to 17 September 2019; and

    (c)the Trustee’s spreadsheet showing calculations of income for CAPs 1,2 and 3.

12. The respondent subsequently engaged in an exchange of correspondence with the applicant’s legal representative. In that correspondence the respondent advised that he was required to decide whether or not to commence the review sought by the applicant within a strict statutory timeframe. The respondent also requested an explanation of the payments received during the relevant period together with any supporting documentation.

13. On 22 January 2020 the applicant’s legal representative wrote to the respondent and advised that he was instructed to respond in general terms that all of the payments received during the relevant period and subsequent cash withdrawals were made for the purpose of the applicant assisting JE and ICS to perform payroll obligations, purchase required stock and provide JE with cash where he was unable to attend a bank or ATM himself. The letter also advised that the applicant was attempting to obtain relevant payroll books of ICS along with receipts and records that, it was claimed, would evidence the ultimate uses of the cash withdrawn.

14. On 3 February 2020 a delegate of the respondent made the decision pursuant to section 139ZA(1)(b) of the Act to not undertake a review of the income assessment as requested by the applicant on the basis that they were not satisfied there were sufficient grounds to justify a review (the reviewable decision). In his reasons for decision the delegate of the respondent noted that he did not consider that the responses provided to him by the applicant’s legal representative prior to his decision had assisted him in clarifying with any certainty the nature of the relevant payments. The delegate went on to conclude he did not believe the respondent was in any better position than the Trustee to make an assessment of the applicant’s income and that he did not consider that the applicant had provided reasons that are sufficient to justify a review.

15. On 2 March 2020 the applicant made application to the Administrative Appeals Tribunal pursuant to section 139ZF of the Act for review of the reviewable decision. That is the matter presently before this Tribunal.

    RELEVANT LEGISLATIVE PROVISIONS

16. The Tribunal has had regard to the following relevant provisions of the Act:

    139K  Definitions

    In this Division, unless the contrary intention appears:

    actual income threshold amount, at the time an assessment is made in relation to a contribution assessment period, means:

    (a)  if the bankrupt does not have any dependants at that time—the base income threshold amount; or

    (b)  if the bankrupt has one dependant at that time—the base income threshold amount increased by 18%; or

    (c)  if the bankrupt has 2 dependants at that time—the base income threshold amount increased by 27%; or

    (d)  if the bankrupt has 3 dependants at that time—the base income threshold amount increased by 32%; or

    (e)  if the bankrupt has 4 dependants at that time—the base income threshold amount increased by 34%; or

    (f)  if the bankrupt has more than 4 dependants at that time—the base income threshold amount increased by 36%.

    assessment, in relation to a contribution assessment period, means the original assessment or a subsequent assessment in respect of that period.

    base income threshold amount, at the time when an assessment is made in relation to a contribution assessment period, means:

    (a) for a contribution assessment period of one year—3.5 times the amount that, at that time, is specified in column 3, item 2, Table B, point 1064‑B1, Pension Rate Calculator A, in the Social Security Act 1991; or

    (b)  for a contribution assessment period less than one year—a proportionally smaller amount based on the number of whole days in the period.

    contribution assessment period, in relation to a bankrupt, means a period that:

    (a)  begins on the day the bankrupt becomes a bankrupt or an anniversary of that day during the bankruptcy; and

    (b)  ends one year after that day or anniversary, as the case requires, or if the bankrupt is discharged or the bankruptcy is annulled within that year, ends upon the discharge or annulment.

    dependant, in relation to a bankrupt in relation to a contribution assessment period, means a person who satisfies all the following conditions:

    (a)  the person resides with the bankrupt;

    (b)  the person is wholly or partly dependent on the bankrupt for economic support;

    (c)  the income derived (or likely to be derived) by the person during the contribution assessment period is not more than the amount prescribed by the regulations for the purposes of this paragraph.

    For the purposes of this definition, income has its ordinary meaning.

    derived means earned, derived or received from any source, whether within or outside Australia.

    income, in relation to a bankrupt, has the meaning given by section 139L.

    income tax includes Medicare levy.

    original assessment, in relation to a contribution assessment period, means the assessment made by the trustee under subsection 139W(1) in respect of that period.

    spouse, in relation to a bankrupt, includes a de facto partner of the bankrupt.

    subsequent assessment, in relation to a contribution assessment period, means an assessment made by the trustee under subsection 139W(2) in respect of that period.

    value, in relation to property referred to in a notice, means the market value of the property when the notice is given.

    139L  Meaning of income

    (1)  In this Division:

    income, in relation to a bankrupt, has its ordinary meaning, subject to the following qualifications:

    (a)  the following are income in relation to a bankrupt (whether or not they come within the ordinary meaning of “income”):

    (i)  an annuity or pension paid to the bankrupt from a provident, benefit, superannuation, retirement or approved deposit fund;

    (ia)  an annuity or pension paid to the bankrupt from an RSA;

    (ii)  a payment to the bankrupt in consequence of a termination of any office or employment;

    (iii)  an amount of annuity or pension received by the bankrupt under a policy of life insurance or endowment insurance;

    (iv)  an amount received by the bankrupt as a beneficiary under a trust to the extent that the amount was paid out of income of the trust;

    (v)  the value of a benefit that:

    (A)  is provided in any circumstances by any person (the provider) to the bankrupt; and

    (B) is a benefit within the meaning of the Fringe Benefits Tax Assessment Act 1986 as in force at the beginning of 1 July 1992 (other than a benefit that would be an exempt benefit for the purposes of that Act if the provider were the employer of the bankrupt as an employee and the provider had provided the benefit in respect of the employment of the bankrupt);

    being that value as worked out in accordance with the provisions of that Act but subject to any modifications of any provisions of that Act made by the regulations under this Act;

    (vi)  the value of a loan made to the bankrupt by an associated entity of the bankrupt, including:

    (A)  a loan under which the loan money is not paid to the bankrupt, but is paid or applied at the bankrupt’s direction; and

    (B)  a loan that is not enforceable at law or in equity;

    (vii)  the amount of any money, or the value of any other consideration, received by a person other than the bankrupt from another person as a result of work done or services performed by the bankrupt, less any expenses (other than expenses of a capital nature) necessarily incurred by the first‑mentioned person in connection with the work or services;

    (b)  the following are not income in relation to a bankrupt (even if they come within the ordinary meaning of “income”):

    (i)  an amount paid to the bankrupt:

    (A) from the Child Support Account established under the Child Support (Registration and Collection) Act 1988; or

    (B)  from another source for the maintenance of children of whom the bankrupt has custody; or

    (iv)  a payment to the bankrupt under:

    (A)  a legal aid scheme or service established under a law of the Commonwealth or of a State or Territory; or

    (B)  a legal aid scheme or service approved by the Attorney‑General for the purposes of paragraph 2(4)(a) of the Federal Court of Australia Regulations; or

    (C)  any other legal aid scheme or service established to provide assistance to people on low incomes;

    (v)  a payment or amount that the regulations provide is not income of the bankrupt.

    pension includes a pension within the meaning of the Superannuation Industry (Supervision) Act 1993.

    (2)  For the purposes of the application of the definition of income in subsection (1) to Subdivision HA, a reference in that definition to a bankrupt includes a reference to a person who has been discharged from bankruptcy.

    Note:          Subdivision HA deals with the supervised account regime.

    139P  Liability of bankrupt to pay contribution

    (1)  Subject to section 139Q, if the income that a bankrupt is likely to derive during a contribution assessment period as assessed by the trustee under an original assessment exceeds the actual income threshold amount applicable in relation to the bankrupt when that assessment is made, the bankrupt is liable to pay to the trustee a contribution in respect of that period.

    (2)  Subject to section 139Q, if the income that a bankrupt is likely to derive during a contribution assessment period as assessed by the trustee under an original assessment does not exceed the actual income threshold amount applicable in relation to the bankrupt when that assessment is made, the bankrupt is not liable to, but may if he or she so wishes, pay to the trustee a contribution in respect of that period.

    139S  Contribution payable by bankrupt

    The contribution that a bankrupt is liable to pay in respect of a contribution assessment period is the amount worked out in accordance with the formula:

    where:

    Assessed income means the amount assessed by the trustee to be the income that the bankrupt is likely to derive, or derived, during the contribution assessment period.

    Actual income threshold amount means the actual income threshold amount assessed by the trustee to be applicable in relation to the bankrupt when the assessment is made.

    139W  Assessment of bankrupt’s income and contribution

    (1)  As soon as practicable after the start of each contribution assessment period in relation to a bankrupt, the trustee is to make an assessment of the income that is likely to be derived, or was derived, by the bankrupt during that period, of the actual income threshold amount that is applicable in relation to the bankrupt when the assessment is made and of the contribution (if any) that the bankrupt is liable to pay in respect of that period under section 139S.

    (2)  If at any time, whether during or after a contribution assessment period, any one or more of the following paragraphs applies or apply:

    (a)  the trustee is satisfied that the income that is likely to be derived, or was derived, by the bankrupt during that period is or was greater or less than the amount of that income as assessed by the last preceding assessment in respect of that period;

    (b)  the base income threshold amount increased or decreased after the making of the last preceding assessment in respect of that period and before the end of that period;

    (c)  the trustee is satisfied that the number of the bankrupt’s dependants increased or decreased after the making of the last preceding assessment and before the end of that period;

    the trustee is to make a fresh assessment of the income that is likely to be derived, or was derived, by the bankrupt during that period, of the actual income threshold amount that is applicable in relation to the bankrupt when the assessment is made and of the contribution (if any) that the bankrupt is liable to pay in respect of that period.

    (3)  The powers of the trustee under subsection (2) may be exercised on the trustee’s own initiative or at the bankrupt’s request, but the trustee is not required to consider whether to exercise those powers at the bankrupt’s request unless the bankrupt satisfies the trustee that there are reasonable grounds for the trustee to do so.

    (4)  As soon as practicable after the making of an assessment the trustee must give to the bankrupt written notice setting out particulars of the assessment and informing the bankrupt about the possibility of a variation under section 139T.

    139X  Basis of assessments

    (1)  In making an assessment of the income that is likely to be derived, or was derived, by a bankrupt during a contribution assessment period the trustee may have regard to any information provided by the bankrupt or any other information in the trustee’s possession.

    (2)  If the trustee considers that any information provided by the bankrupt is or may be incorrect, the trustee may disregard that information and may make an assessment on the basis of what the trustee considers to be the correct information.

    139Y  Trustee may regard bankrupt as receiving reasonable remuneration

    (1)  If:

    (a)  the bankrupt is engaging or has engaged during a contribution assessment period in employment or other work or in activities that resemble employment or other work; and

    (b)  the bankrupt does not receive or did not receive any remuneration in respect of the employment, work or activities or receives or received remuneration that is less than the remuneration (in this subsection called the reasonable remuneration) that:

    (i)  in the case of employment where an industrial instrument prescribes rates or minimum rates of salary or wages for the employment—might reasonably be expected to be or to have been received by the bankrupt in respect of the employment by virtue of the industrial instrument; or

    (ii)  in any other case—might reasonably be expected to be or to have been received by a person who engaged in similar employment, work or activities where there was no relationship or other connection between that person and the person for whom the employment, work or activities were carried out;

    then, for the purpose of making an assessment, the trustee may determine that the bankrupt receives or received the reasonable remuneration in respect of the employment, work or activities.

    (2)  If:

    (a)  the bankrupt enters or entered during a contribution assessment period into any transaction that might reasonably be expected to produce or to have produced income; and

    (b)  the bankrupt does not derive or did not derive any income from the transaction or derives or derived income that is less than the income (in this subsection called the reasonable income) that might reasonably be expected to be or to have been derived if the transaction were or had been entered into at arm’s length;

    then, for the purpose of making an assessment, the trustee may determine that the bankrupt derives or derived the reasonable income from the transaction.

    139Z  If bankrupt claims not to be in receipt of income

    (1)  If a bankrupt:

    (a)  does not provide information about whether he or she is likely to derive, or derived, income or a particular class of income during a contribution assessment period; or

    (b)  claims not to be likely to derive, or not to have derived, any income or a particular class of income during a contribution assessment period;

    but the trustee has reasonable grounds for believing that the bankrupt is likely to derive, or derived, income, or income of that class, during that period, then, for the purpose of making an assessment, the trustee may determine that the bankrupt is likely to derive, or derived, income, or income of that class, during that period and may also determine the amount of that income.

    (2)  Without limiting the matters that a trustee may take into account for the purpose of making an assessment as mentioned in subsection (1) in respect of a contribution assessment period, the trustee may have regard to any employment or other work or other income‑producing activities that were engaged in by the bankrupt before that period and may determine whether the bankrupt is likely to engage, or to have engaged, in similar employment, work or other income‑producing activities during that period.

    139ZA  Internal review of assessment

    (1)  The Inspector‑General may review a decision of a trustee to make an assessment:

    (a)  on the Inspector‑General’s own initiative; or

    (b)  if requested to do so by the bankrupt for reasons that appear to the Inspector‑General to be sufficient to justify such a review.

    (2)  The Inspector‑General must review such a decision if requested to do so by the Ombudsman.

    (3)  A request by the bankrupt to the Inspector‑General for the review of such a decision must:

    (a)  be in writing and given to the Inspector‑General not later than 60 days after the day on which the bankrupt is notified of the trustee’s assessment; and

    (b)  be accompanied by:

    (i)  a copy of the notice of assessment; and

    (ii)  any documents on which the bankrupt relies in support of the request.

    (5)  Within 60 days after the request is received, the Inspector‑General must:

    (a)  decide whether to review the decision; and

    (b)  if the Inspector‑General decides to review the decision—make his or her decision on the review.

    139ZF  Review of assessment decisions

    An application may be made to the Administrative Appeals Tribunal for the review of:

    (a)  a decision of the Inspector‑General on the review of a decision by a trustee to make an assessment; or

    (b)  a decision by the Inspector‑General refusing a request to review a decision by a trustee to make an assessment.

    ISSUE

1. The issue for determination is whether the Tribunal is satisfied that there are reasons sufficient to justify a review of the Trustee’s decision.

2. The Tribunal accepts the respondent’s contention put at the hearing that section 139ZA(1)(b) of the Act does not impose a burden of proof on the applicant. However, any decision of the Tribunal to the effect that there are reasons sufficient to justify a review of the Trustee’s decision must be based on relevant, probative evidence that has been put before it.[1]

   [1] See Lavin and Inspector-General in Bankruptcy [2017] AATA 890 and Aston v Barnet in her capacity as the Trustee of the Property of Aston [2019] FCCA 2523.

   CONTENTIONS, EVIDENCE AND CONSIDERATION

3. The applicant tendered a bundle of expenditure receipts for the period between 7 June 2020 and 30 September 2020 together with a witness outline in respect of both himself and JE. The respondent tendered two bundles of section 37 T Documents; part A and B of a Statement of Affairs form relating to the applicant lodged 27 April 2021; and the applicant’s creditors petition lodged in the Federal Circuit Court of Australia on 7 October 2016. Both the applicant and JE gave evidence directly to the Tribunal at the hearing.

4. In the course of giving his evidence the applicant adopted his witness outline dated 10 December 2020 as his evidence in chief. In his witness outline the applicant concedes that between 2 February 2017 and 4 September 2019 a total of $413,261.10 was deposited into his bank account. The applicant states in his outline that the whole of this amount was paid to him “from ICS”. When pressed in cross-examination as to whether he had received a portion of the payments from his daughter, SE, the applicant conceded that he had but that the payments were made by SE on behalf of JE when JE was not available. The Tribunal has understood the applicant’s evidence in this respect to be that the payments were made into his account from ICS funds either directly from the ICS bank account or indirectly via SE on JE’s behalf. In his direct evidence JE denied having made payments from ICS funds to SE or having SE pay amounts on his behalf to the applicant. The Tribunal accepts the applicant’s evidence over JE’s evidence on this point. JE’s answers to questions on this issue were very abrupt and the Tribunal was left with the distinct impression that in answering the questions as he did JE was seeking to avoid involving SE in the matters before the Tribunal rather than answering the questions fully and truthfully. There is also no other evidence before the Tribunal that would explain how SE was in a position to make the transfers from her account to the applicant’s account in the amounts as recorded in the bank statements. On the basis of the evidence before it the Tribunal is satisfied that during the relevant period the applicant received payments into his account from ICS funds in the amount of $413,261.10 (relevant payments) consistent with the applicant’s statement in his witness outline.

5. The applicant’s central contention is that the relevant payments were funds deposited into his account on trust for a specific purpose, being a combination of both expenses incurred in providing catering services to Father Michael and expenses incurred in purchasing household items on behalf of the family, in each case at JE’s direction. The applicant’s evidence was that he incurred household expenses consistent with this arrangement in respect of CAP 1 in the amount of $102,000, in respect of CAP 2 in the amount of $111,600 and in respect of CAP 3 in the amount of $70,000. The applicant’s evidence was that the balance of the funds deposited into his account were for the purpose of meeting expenses associated with catering for Father Michael.

6. The applicant contends that the bundle of receipts tendered at the hearing are reflective of the manner in which the relevant payments were expended. The applicant contends that as the relevant payments were held on trust they were not for his own use and benefit and therefore not “income” for the purpose of assessing his income contribution liability in accordance with the Act. In addition, the applicant contends that he was not at any time during the relevant period engaged in employment type activities in connection with the business. More specifically the applicant denies assuming senior management responsibilities in connection with the business or acting as a shadow or de facto director of ICS.

7. The applicant contends that his involvement in the business was ad hoc and voluntary and best characterised as a father seeking to help his son. The applicant contends that JE was at all times during the relevant period the sole director of ICS and held overall responsibility for the business with the assistance of senior staff. The applicant contends that the voluntary, ad hoc activities he undertook in connection with the business were in accordance with JE’s requests for assistance and subject to his instruction. The applicant denies that he received or was entitled to receive any form of wages or remuneration in return for the activities he undertook in connection with the business. The applicant contends that there is no basis to deem or otherwise assess any component of the relevant payments as being his income for the purpose of calculating an income contribution liability in respect of him in accordance with the Act.

8. The applicant contends that his only income during the relevant period was limited to a pension and carer’s allowance and that his income during that period was below the income threshold amount as determined by the Trustee and therefore that he should not have been assessed as having an income contribution liability in respect of his bankruptcy for the relevant period in any amount. 

9. The respondent contends that the explanation provided by the applicant in respect of the relevant payments should not be accepted by the Tribunal. The respondent contends that the applicant has failed to produce any documentary or other independent evidence to support his explanation. The respondent contends that the bundle of receipts tendered by the applicant is not relevant, probative evidence in respect of how the relevant payments were expended given that they are receipts in respect of a period following the relevant period. The respondent contends that the Tribunal should also not accept the direct evidence given by both the applicant and JE on the basis that it is not reliable nor credible in material respects. In addition, the respondent contends that the applicant’s explanation for the relevant payments has shifted over time further undermining the credibility of his account.

10. The respondent contends that in the absence of compelling, probative evidence in support of the applicant’s explanation for the relevant payments there is no reasonable basis for the Tribunal to be satisfied that there are sufficient reasons to justify a review of the Trustee’s decision and that therefore the decision under review should be affirmed.

11. As stated above in his direct evidence the applicant adopted his witness outline as his evidence in chief. JE also adopted his witness outline dated 14 August 2020 in the same manner.

12. Both the applicant and JE gave evidence regarding the background to ICS and the business that was not in contention and which is accepted by the Tribunal. That evidence was that the applicant had previously provided catering services to RusCare. The applicant told the Tribunal that Father Michael, who is the applicant’s former father-in-law, had some time before 2012 suggested that the applicant become involved in providing catering services to aged care facilities being run by Father Michael and he had agreed to do so. He initially began providing services as a sole trader and then subsequently through a company by the name of Al’s Catering. The applicant’s evidence was that Al’s Catering had run into some difficulty as a result of a dispute with the ATO and was deregistered in 2016.

13. The applicant told the Tribunal that following the deregistration of Al’s Catering a tender was run by RusCare for the awarding of a replacement catering services contract. Father Michael had asked the applicant to be involved in the assessment of tenders for the contract which he agreed to do. The applicant’s son, JE, then tendered for the contract through ICS. ICS was ultimately successful in the tender and was subsequently awarded the RusCare catering services contract. JE is recorded as the sole director of ICS. ICS operated the business providing catering services to RusCare between December 2015 and November 2018.

14. Both the applicant and JE gave evidence that following the awarding of the contract JE had assumed full responsibility for ICS and the business but with the assistance of senior staff. Both the applicant and JE nominated the head chef and another senior chef as being particularly experienced staff who had transferred across from the Al’s Catering to the new business and who assumed responsibility for the day to day activities of the business. They also both stated that there was a bookkeeper and accountant who managed the books of the business on behalf of JE.

15. The applicant’s evidence was that at his son’s request he had provided ad hoc, voluntary assistance in the business in order to pass on to his son some of the knowledge he had gained through his previous involvement in providing catering services to RusCare. The applicant told the Tribunal that while his son had some prior catering experience he had gained through exposure to broader family businesses, he had very little experience in catering for aged care specifically. In addition, the applicant told the Tribunal that despite taking up the RusCare contract JE continued his employment with Qantas at Tullamarine Airport where he often worked night shifts. The applicant also gave evidence that he continued to have regular engagement with Father Michael through the course of the ICS contract with RusCare and the evidence of both the applicant and JE was that as a consequence of the applicant’s personal relationship with Father Michael, Father Michael continued to view the applicant as a relevant contact point through which to make catering requests or to raise issues he had in connection with the services being provided. The applicant’s evidence was that in addition to the obligations formally under the RusCare contract, Father Michael had an expectation that certain additional personal catering services would be provided and that in that context Father Michael would regularly make requests to the applicant for the provision of personal catering services including from time to time, catering of more substantive events such as significant celebrations, anniversaries or other special events.

16. The applicant’s evidence was that he would attend the business in the morning on most weekdays and he would find out what Father Michael’s catering requests were for the day. He would pass on the relevant requests to staff for them to prepare and then leave. His evidence was that he would usually have left before lunch but would occasionally stay for a period in the afternoon. He told the Tribunal that as part of his morning activities he would shop for necessary supplies and provide them to the staff. The applicant’s evidence was that he only undertook activities in connection with the business in this manner on JE’s instructions and denied instructing staff himself. However, there was some inconsistency in the applicant’s evidence in this respect. In the applicant’s witness outline the applicant stated that he assumed responsibility for ensuring that staff turned up each day. When pressed on this point in cross-examination the applicant denied having any oversight of staff at all and again emphasised that the staff were experienced are largely self-sufficient.

17. The applicant’s evidence in relation to attending meetings in connection with the business was also inconsistent. In his witness outline the applicant had stated that at RusCare’s request he frequently attended meetings in person. In his direct evidence he initially denied attending meetings but when pressed in cross-examination conceded that he did so occasionally but that could not say with any precision how often.

18. The applicant denied that he was, in any formal sense, a point of contact for ICS in respect of the RusCare contract although he accepted that he had regular contact with Father Michael. The applicant told the Tribunal that his engagement with Father Michael was due to their pre-existing relationship. The applicant denied being responsible for ensuring health and safety requirements were followed. He told the Tribunal that the head chef assumed this responsibility and where necessary “she would pull people into line”. The applicant acknowledged that he had handled invoices on behalf of the business occasionally if he happened to be at the business in the morning but that he was not involved in the writing up of the invoices.

19. The applicant specifically denied acting as a director of ICS or being engaged as an employee of the business or undertaking management responsibilities in respect of the business. He told the Tribunal that he was helping out as a father would his son but that at all times JE had retained control over ICS and the business.  The applicant specifically denied receiving remuneration or wages in connection with his activities in the business or being entitled to any remuneration or wages.

20. The applicant’s explanation for the relevant payments was that they were payments deposited into his account from ICS funds for use in facilitating catering services for Father Michael or otherwise for meeting family household expenses. The applicant told the Tribunal that in each case he spent the money on JE’s instruction and in that sense the funds had been deposited into his account on trust for a specific purpose and not for his own use.

21. The applicant’s evidence was that JE had requested that he sometimes purchase household items for the family on JE’s behalf. The applicant’s evidence was that he lived with four of his five children who were aged between 17 years and 33 years at the time and also looked after his mother. He told the Tribunal that two of his adult children’s partners also spent considerable time at the family home as well as his own partner. His evidence was that JE would meet the cost of the household expenses for the whole family from the profits of ICS by transferring funds from ICS to his account for him to spend on household necessities. His evidence was that JE contributed through ICS between February 2017 and February 2018 approximately $60,000 for food and $42,000 for utilities, car, fuel and clothes for the whole family; between February 2018 and February 2019 approximately $66,000 for food and $45,600 for utilities, car, fuel clothes for the whole family; and between February 2019 and September 2019 approximately $42,000 for food and $28,000 for utilities, car, fuel clothes for the whole family.

22. The applicant tendered a bundle of receipts of expenditure in relation to groceries and living expenses for the family for the period from 7 June 2020 to 30 September 2020 which he claimed was reflective of the manner in which the relevant payments were expended. The applicant’s evidence was that between 7 June 2020 to 30 September 2020 he spent a total of $24,949.87 on groceries and living expenses for the whole family including his mother equating to approximately $216.87 per day or $78,156.98 per annum.

23. The applicant’s evidence was that during the relevant period ICS had also incurred approximately $30,000 per year in expenses for additional events and personal catering on behalf of Father Michael. Again, the applicant’s evidence was that those funds would be transferred into his bank account and spent on facilitating the additional events and personal catering as instructed by JE.

24. The applicant told the Tribunal that he had no receipts of expenditure for the relevant period itself. He told the Tribunal that there were at the time receipts of such expenditure which he was in the practice of leaving on the kitchen bench for JE to see. He told the Tribunal that the receipts were not kept as it was a family arrangement and he did not believe it was necessary to keep the receipts. The applicant also conceded in his evidence that there was no documentation of the trust arrangement he claimed existed in respect of the relevant payments. Again, he told the Tribunal that it was a family arrangement and he did not believe it was necessary to have any form of documentation.

25. The applicant gave evidence that he is unemployed and that his main source of income is a pension of approximately $944 a fortnight, plus $310 per fortnight as a carer’s allowance. His evidence was that he began receiving the carer’s allowance in March 2019 after taking responsibility to care for one of his sons who has a disability.

26. The applicant’s son, JE, also gave evidence at the hearing. JE’s evidence was that he assumed overall responsibility for ICS and the business following the successful tender of the RusCare contract. His evidence was that he is the sole director of ICS and that the assistance the applicant provided in the business was voluntary and at his request and instruction. JE told the Tribunal that he had continued in his employment with QANTAS which involved night shift work. JE’s evidence was that the applicant attended the business in the mornings most weekdays although he would not say every weekday. He conceded that he had rarely been on site at the business. He told the Tribunal he relied heavily on the head chef and another senior chef as well as the bookkeeper and accountant in managing the affairs of the business. He denied that his father was an employee or shadow director of ICS or had been paid or was entitled to wages or remuneration for his assistance. His evidence was that in assisting him the applicant was assisting a family member. He denied that the applicant was involved in meetings on behalf of the business although he agreed that on occasions Father Michael had engaged with the applicant in connection with the business and his personal catering due to his personal relationship with the applicant. His evidence was that his father would “make sure that staff turned up and would make sure Father Michael’s specific meal requests were attended to”.

27. JE’s explanation for the relevant payments was very similar to the applicant’s explanation. He told the Tribunal that he deposited money into the applicant’s account to be used for purchasing stock and other items needed in the business kitchen or organising other events for Father Michael. His evidence was that, in addition, he had provided funds into the applicant’s account to be spent on household items on behalf of the family. His evidence was that for the past 10 years he has lived with his father along with his father’s children, one of whom is deaf and autistic and that he felt an obligation to provide for the family. Again, he gave evidence to the Tribunal that the relevant payments had been deposited into the applicant’s account on trust for a specific purpose and not for the applicant’s own use.

28. JE’s evidence was that his father would arrange for catering for Father Michael that went above and beyond what ICS was obliged to provide under its contract with RusCare. That included catering for special events held by Father Michael as well as catering for Father Michael’s family and guests throughout the year. JE’s witness outline, which JE adopted at the hearing, stated that:

    For example, in 2017 and 2018 Albert provided cooking for Father Michael’s family, almost every day, when father Michael’s wife was unwell, and Albert would do shopping for Father Michael and his wife, which was never repaid for.

    On average the above events involved around $30,000 in expenses, and ICS put Albert in funds for those expenses.

1. JE’s witness outline also set out details in relation to household expenses that JE claims were met through funds transferred into the applicant’s account as follows:

   (i) between February 2017 and February 2018 approximately $60,000 for food, and $42,000 for utilities, car, fuel and clothes (for the whole family);

   (ii) between February 2018 and February 2019 approximately $66,000 for food, and $45,600 for utilities, car, fuel and clothes (for the whole family); and

   (iii) between February 2019 in September 2019 approximately $42,000 for food and $28,000 for utilities, car, fuel and clothes (for the whole family),

   (iv) and I did so by providing Albert with regular funds or those expenses.

2. There are a number of concerns the Tribunal has with the applicant’s contentions and the evidence provided in support by both himself and JE.

3. First, there is a lack of documentary or other independent evidence in support of the applicant’s explanation for the relevant payments.

4. The only substantive documentary evidence the applicant has presented to the Tribunal in support of his case was the bundle of receipts tendered at the hearing. The bundle of receipts evidence a series of expenditure between 7 June 2020 and 30 September 2020. The Tribunal accepts the respondent’s contention that the bundle of receipts is not probative of the issues before the Tribunal. The receipts clearly relate to a period that is beyond the end of the relevant period. In addition, the Tribunal is satisfied that there is not independent or other compelling evidence to draw any kind of inference that the expenditure the receipts evidence is in some way reflective of the purpose for which the relevant payments were deposited into the applicant’s account or the manner in which they were expended.

5. In their evidence to the Tribunal both the applicant and JE conceded that they had not retained any receipts relating to the expenditure of the relevant payments. When asked what documentary evidence he had to demonstrate the purpose of the relevant payments and the manner in which those funds were used the applicant told the Tribunal that there was no documentation and he did not believe he needed to keep receipts. When pressed further in cross-examination the applicant told the Tribunal that he had initially kept receipts for items purchased and that he was in the habit of leaving receipts at home on the kitchen bench for JE to see but that he then threw them out as he did not realise he needed to keep them.  

6. When JE was questioned on the existence of receipts for expenditure of the relevant payments, he also told the Tribunal that no receipts were kept. He told the Tribunal that receipts were left on the bench but that he did not check them and did not keep them. When asked how in the absence of receipts he was able to say so definitively in his witness outline what the amount of expenses in respect of the relevant period were JE told the Tribunal “it’s a rough estimate […] it’s a guess based on memory checked against bank statements”.

7. In their direct evidence to the Tribunal both the applicant and JE conceded that there was no other documentary or independent evidence in relation to the existence of the trust arrangement they claim governed the expenditure of the relevant payments.

8. When asked whether there was any documentation to support his contention that the relevant payments were deposited into his account on trust for a specific purpose in the manner he contends, the applicant told the Tribunal that there was no documentation of the trust arrangement. Rather, there was just an expectation that the funds would be expended in that manner. The applicant told the Tribunal that it was a family arrangement and as such he did not believe it was necessary for the arrangement to be documented in any way.

9. The Tribunal found the evidence of both the applicant and JE in response to this line of questioning to be vague and generally not credible. Neither the applicant nor JE were able to provide a credible explanation for how the amounts of the relevant payments paid into the applicant’s account were determined. When asked how he determined the amounts necessary to transfer for expenses JE told the Tribunal that he just paid “what was needed”.  The applicant told the Tribunal that there was no formal structure governing the arrangement he claims existed but that in the case of household expenses either JE or “the girls” would just write down what they wanted on a piece of paper and he would go and get it. In relation to the purchase of supplies in connection with the business or for Father Michael’s personal catering the applicant told the Tribunal that he would go in to the business in the mornings and find out what Father Michael’s requirements were for the day or what else was needed, go out and purchase the items and then hand over to the chefs to prepare.

10. While the Tribunal accepts that generally speaking it would be reasonable to not expect documentation of a family understanding as to how money collectively held by members of the family might be spent, nor necessarily for receipts to be retained in respect of such an arrangement, in this case the applicant is claiming the existence of a trust arrangement which governed the manner in which funds paid into his account were to be spent. In the Tribunal’s view it would be reasonable to expect some form of documentary evidence of such an arrangement.  In addition, the applicant gave evidence that some of the shopping he undertook was “for ICS”. In the Tribunal’s view any logic in the suggestion put by the applicant that receipts were not necessary because of it was personal in nature does not extend to shopping undertaken “for ICS” as he stated in his witness outline. In the course of his evidence, JE appeared to suggest that the funds expended on catering for Father Michael was not within the terms of the catering services contract with RusCare and therefore in that sense not a business expense. The applicant also told the Tribunal that the catering services provided to Father Michael were due to their close personal relationship, that he “could not say no”, and further, that expenses incurred in delivering such services were not linked to the business. The Tribunal does not accept JE’s or the applicant’s characterisation of the catering service provided to Father Michael in this manner. On the basis of the evidence before it the Tribunal is satisfied that any expectation Father Michael had of being provided catering services was an expectation that arose in connection with the awarding of the RusCare contract both to ICS and, prior to that, to the applicant’s former company, Al’s Catering. The expectation as it existed through the course of the ICS RusCare contract was more than a mere personal expectation. It is also clear from the evidence that the catering services were undertaken through the business’s kitchen and by staff of the business. In the Tribunal’s view any such services were of a business nature and it is reasonable to expect there to have been some form of documentary evidence of expenditure incurred in providing the services. In the Tribunal’s view, the absence of any form of documentary evidence of the trust arrangement in respect of the relevant payments significantly undermines the credibility of the applicant’s claim that such a trust arrangement ever existed.

11. The Tribunal also has concerns regarding the apparent inconsistencies in the applicant’s explanation for the relevant payments. In the initial correspondence between the applicant’s legal representative and the Trustee the explanation for the relevant payments centred around the applicant’s involvement in core functions of the business, including payroll obligations and the purchasing of stock, with no express reference being made to a portion of the relevant payments being spent on meeting broader family household expenses. For example, in the letter dated 2 September 2019 the explanation for the relevant payments provided on behalf of the applicant only referred to business reimbursements for shopping undertaken on behalf of the business. The letter made no reference to the payments being provided for the purpose of meeting the household expenses of the family. In a further letter from the applicant’s legal representative to the Trustee dated 22 January 2020, the explanation provided for the relevant payments on behalf of the applicant was that the funds were paid to the applicant for the purpose of assisting JE and ICS perform payroll obligations, purchase required stock and provide JE with cash where he was unable to attend a bank or ATM himself. In that letter, the applicant’s legal representative indicated that efforts were being made to secure payroll books of the business to provide further evidence of the manner in which the relevant payments were expended. No such further materials have been provided by the applicant. Again, the letter included no reference to the payments being provided for the purpose of the meeting household expenses of the family. In contrast, both the applicant and JE gave evidence at the hearing that the majority of the relevant payments were paid to the applicant for the purpose of meeting the household expenses of the family. In the Tribunal’s view this apparent inconsistency further undermines the credibility of the applicant’s explanation for the relevant payments.

12. For these reasons, the Tribunal does not accept the applicant’s explanation for the relevant payments. While the Tribunal accepts that some funds from the applicant’s bank account are likely to have been expended on household expenses, on the basis of the evidence, it does not accept that they were necessarily expended from the relevant payments and even if they were, the Tribunal nonetheless does not accept that the relevant payments were subject to a trust arrangement or otherwise subject to JE’s instruction as contended by the applicant. Rather, any such household expenses that were met from the relevant payments are more accurately characterised as personal expenses met from the applicant’s own funds. That is so even if they were spent, in part, for the benefit of other family members. Similarly, while the Tribunal accepts that ICS funds were likely to have been expended on delivering personal catering services to Father Michael given that the provision of those services was in connection with the business, it is not satisfied on the basis of the evidence that those expenses were funded from the relevant payments. Further, the Tribunal does not accept that any of the relevant payments were subject to a trust arrangement of any kind or otherwise subject to JE’s instruction as contended by the applicant.

13. The Tribunal also does not accept the central contention in the evidence of both the applicant and JE in relation to their respective involvement in ICS and the business.

14. In their direct evidence the applicant and JE both maintained that following ICS securing the RusCare contract, JE had assumed overall responsibility for the business and the applicant’s involvement had been ad hoc, voluntary and subject to JE’s instruction. The applicant and JE also both gave evidence that they did not consider the applicant to have been employed in the business, to have assumed senior management responsibilities of any kind, or to have been acting as a de-facto or shadow director. They both told the Tribunal that the applicant was not remunerated in any way for his activities in connection with the business. The Tribunal rejects both the applicant’s and JE’s evidence in this respect.

15. In the Tribunal’s view the applicant’s pattern of attendance at the business is strongly suggestive of the applicant having maintained an active ongoing involvement in day to day affairs of the business. This is particularly so given the applicant’s prior experience in delivering catering services to RusCare through his former company, Al’s Catering. Similarly, in the Tribunal’s view, the very limited time JE spent physically present at the business together with his lack of prior experience in the business is inconsistent with him having assumed overall responsibility for the business and being sufficiently familiar with the day to day affairs of the business to be able to provide meaningful instructions either to the applicant himself, or to staff, in the conduct of any substantive activities in connection with the business.

16. Both the applicant and JE gave evidence that JE had spent very limited time physically present in the business. The applicant told the Tribunal that JE was not present on site at the business very often but that he “would pop down on weekends here and there”. This stood in stark contrast to the frequency of his own presence in the business. When the applicant was asked how often he would attend the business premises he told the Tribunal that he would drop in most mornings and that he would occasionally spend time at the business in the afternoon. JE conceded in his direct evidence that he had spent little time physically present at the business. When asked how frequently he attended the business over the course of the contract JE told the Tribunal that he was there a few times “but rarely”. In contrast, JE confirmed to the Tribunal that the applicant would typically attend the business in the morning during the course of the week to help out because he was tired due to his night shift work.

17. The applicant told the Tribunal that in his view JE did not need to be physically present on site as the day to day operations were managed effectively by the head chef and other senior staff who were very experienced. While the Tribunal accepts that senior staff at the business were very experienced and able to manage much of the practical day to day operation without instruction, the Tribunal does not accept as plausible the suggestion that staff were effectively left unsupervised or with no effective day to day oversight on behalf of the ownership of the business. In his evidence at the hearing the applicant conceded in cross-examination that the RusCare contract was a “lucrative” contract. JE estimated that the contract was worth approximately $1m a year. On the basis of the material before it the Tribunal is satisfied that the RusCare contract was a very substantial one and that it is not plausible that an owner of a business that had the benefit of such a contract would allow it to be delivered without some reasonable level of day to day oversight on behalf of the business ownership. In the Tribunal’s view, any suggestion that JE performed such a role is not credible having regard to the limited presence he had on site and his limited prior experience in providing catering services to an aged care facility.

18. The Tribunal is also satisfied that JE lacked a level of familiarity with key aspects of the business that could reasonably be expected of someone who had assumed overall responsibility. In the Tribunal’s view, a number of JE’s answers to questions put to him in the hearing were inconsistent with a person who has assumed overall responsibility for the business as contended by both JE and the applicant. When pressed on his understanding of occupational health and safety requirements of the business JE did not provide any substantive response beyond saying that he had previously undertaken a course on health and safety which he was not able to name. When pressed further JE conceded that he relied on staff to manage this aspect of the business. In the Tribunal’s view JE’s response to this line of questioning demonstrated a lack of familiarity with health and safety requirements which would reasonably be expected of a director of a company operating a catering services business. JE also told the Tribunal that no records were kept of directors’ meetings of the business. When asked whether this was consistent with company’s legal requirements JE told the Tribunal that the head chef took care of things. When asked whether he was involved in the handling of invoices JE indicated that he was not and that those matters were handled by the head chef or another employee of the business. When asked how often the invoices were issued JE was unable to be definitive telling the Tribunal that he was not sure but that he thought monthly. The Tribunal was left with the distinct impression that in responding to this question JE did not know the answer and was guessing as to how frequently invoices were issued.

19. In the Tribunal’s view, JE’s lack of familiarity with key aspects of the business demonstrated through his direct evidence to the Tribunal is strongly suggestive of him not having assumed overall responsibility in relation to the business. In the Tribunal’s view, in these circumstances it is implausible that the applicant’s role in the business was simply voluntary and ad hoc and subject to JE’s direction as contended by the applicant.

20. In the course of his evidence the applicant denied playing any form of oversight role in respect of the business and told the Tribunal that he had limited knowledge of or experience in the business. The Tribunal does not accept the applicant’s evidence in this respect. While the Tribunal accepts that when the applicant first commenced providing catering services for Father Michael he had limited experience providing such services, the Tribunal does not accept that the applicant could reasonably be described as lacking knowledge of or experience in the business during the term of ICS’s contract with RusCare. At that time the applicant had the benefit of several years’ experience in providing catering services for Father Michael’s aged care facilities, having first commenced providing such services in approximately 2012. Any suggestion that the applicant lacked knowledge of or experience in the business was also inconsistent with his evidence that Father Michael would come to him with any concerns he had. It is also inconsistent with the statement included in the applicant’s witness outline that RusCare would frequently request his attendance at meetings and also that he wanted to pass down his knowledge to JE so that one day JE would be able to run ICS by himself. The Tribunal is satisfied that given his prior experience, his personal relationship with Father Michael and his presence on site at the business on a regular basis the applicant is the only person in a position to have undertaken an oversight role on behalf of the business ownership. Further, the Tribunal is satisfied that the applicant did in fact undertake such a role at all times through the course of ICS’s contract with RusCare.

21. In the Tribunal’s view, this conclusion is further reinforced by the evidence that JE had maintained ongoing employment during the period of the RusCare contract. Both the applicant and JE confirmed in their evidence that JE had worked in the airline industry for QANTAS at Tullamarine Airport prior to taking up the RusCare contract and had continued in that employment during the entirety of the term of the RusCare contract.

22. The Tribunal also does not accept the applicant’s contention that he did not provide instructions to staff of the business or have oversight of staff. In his direct evidence the applicant told the Tribunal that he did not direct staff as they did not need his direction. He told the Tribunal that the head chef in particular was very experienced and together with another senior chef they would manage the business on a day to day basis. He told the Tribunal that if he happened to be at the business and Father Michael raised an issue with him, he would speak to the head chef for her to handle. When pressed further on this point the applicant denied that he would pass on a complaint from Father Michael to the head chef but rather that he would go home and raise it with JE and then take directions from JE on how to respond. The Tribunal found the applicant’s evidence in this respect self-serving and not credible. The Tribunal was left with the distinct impression that in responding to this line of questioning the applicant was searching for an answer that would accord with his contention that JE was in charge of the business rather than responding to the questions truthfully. In the Tribunal’s view, the applicant’s responses to questions on this point were also inconsistent with his evidence that he was seeking to pass down his knowledge to JE so that one day he would be able to run ICS by himself.

1. Further, in his witness outline the applicant acknowledged that part of his daily function in attending the business was to ensure “staff turned up”. The Tribunal accepts this evidence. In the Tribunal’s view this is consistent with the applicant having oversight of staff. The applicant’s own evidence was that he would attend in the mornings and determine Father Michael’s requirements and then ensure that those requirements were taken care of. In the Tribunal’s view this is also consistent with the applicant providing a level of direction to staff.

2. When asked to respond to the respondent’s contention that his father had an active day to day role instructing and overseeing staff in the business, JE denied that his father had such a role. He told the Tribunal that his father would just go in there because he had relationships with people. More specifically, JE denied that his father had any form of management responsibility in respect of the business, rather, he maintained that any activities the applicant undertook were on his instructions. However, JE told the Tribunal that his father would discuss things with Father Michael and then tell the staff what was required. When pressed JE conceded that at times his father would engage with staff directly but continued to maintain that his father had no formal management or employee type role in the business. JE conceded that his father would sometimes help out with food supplies or securing stock if he needed his assistance but continued to maintain that his father’s activities did not constitute a role in the business but rather amounted to his father helping out because of his relationship with him and others in the business. The Tribunal found JE’s evidence in this regard somewhat confused and was left with the distinct impression that JE was seeking to provide answers to questions put that he thought would be helpful to the applicant’s case rather than answer the questions truthfully.

3. Having considered all of the evidence before it the Tribunal is satisfied that the applicant provided a level of instruction to staff on a daily basis and had an oversight role in respect of staff.

4. The Tribunal is also satisfied that the applicant attended meetings on behalf of the business on a regular basis. The applicant’s evidence regarding his attendance at meetings on behalf of the business was inconsistent. In his witness outline the applicant stated that he attended meetings on “numerous” occasions in response to RusCare’s frequent requests and to help “John and ICS”. In his direct evidence the applicant initially told the Tribunal that he would sometimes be asked by Father Michael to attend meetings but that he did not attend, rather the head chef would attend the meetings. However, when pressed further in cross-examination the applicant conceded that he did attend some meetings with RusCare although he could not say how often. In his evidence JE also denied that the applicant attended meetings telling the Tribunal that the head chef attended any necessary meetings with RusCare. Again, the Tribunal found JE’s evidence unconvincing on this point.

5. Given the applicant’s regular attendance at the business, his prior experience delivering services to RusCare and his personal relationship with Father Michael, the Tribunal is satisfied that that the applicant did in fact attend meetings on behalf of the business on a frequent basis. In the Tribunal’s view, the fact that the applicant attended numerous meetings is consistent with the applicant having continued to maintain an ongoing active role in the business, being involved in key decision making of the business and assuming senior management responsibilities in connection with the business.

6. For these reasons, the Tribunal is satisfied that at all relevant times the applicant maintained an active role in the day to day affairs of the business following the awarding of the RusCare contract through ICS. The Tribunal is satisfied that in doing so the applicant assumed senior management responsibilities and was involved in key decision making in relation to the business. The Tribunal is satisfied that the applicant’s activities in relation to the business constituted employment or resembled employment or were otherwise work-related activities consistent with acting as a principal in the business and as a de facto or shadow director of ICS.

7. Having considered the whole of the evidence the Tribunal does not accept the applicant’s explanation for the relevant payments. In the absence of a credible explanation from the applicant and in light of the other conclusions reached by the Tribunal as set out above, the Tribunal is satisfied that there are reasonable grounds for believing that the relevant payments were funds paid to the applicant for his own use and benefit and income for the purpose of assessing his income contribution liability in accordance with the Act.

8. In the Tribunal’s view, the applicant’s active ongoing involvement in the business is also consistent with the relevant payments having been paid to him in return for his work related activities in the business and which were intended to be available to him for his own use and benefit. In this context the Tribunal is satisfied that the applicant did not otherwise receive remuneration for his involvement in the business. In addition, in the Tribunal’s view the amounts of the relevant payments are amounts consistent with what might reasonably be expected to be received by the applicant as remuneration having regard to the nature of his involvement in the business and the substantial nature of the RusCare contract. This conclusion is further reinforced by JE’s evidence that he did not take personal drawings from ICS funds in connection with his own involvement in the business.

9. For these reasons, the Tribunal is not satisfied on the evidence before it that there are sufficient grounds to justify a review of the Trustee’s decision.

   DECISION

10. The decision under review is affirmed.

I certify that the preceding 76 (seventy-six) paragraphs are a true copy of the reasons for the decision herein of The Hon. Matthew Groom, Senior Member

...............................[SGD].........................................

Associate

Dated: 4 October 2021

Date(s) of hearing:	28 April 2021
Advocate for the Applicant:	M. Nurse
Solicitors for the Applicant:	Logie-Smith Lanyon Lawyers
Advocate for the Respondent:	J. Giacco
Solicitors for the Respondent:	McInnes Wilson Lawyers