Georgakopoulos v Deputy Commissioner of Taxation
[2011] VSCA 41
•25 February 2011
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2010 0170
| FOTIAS GEORGAKOPOULOS |
| v |
| DEPUTY COMMISSIONER OF TAXATION (CTH) |
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JUDGES: | REDLICH JA and MANDIE JA | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 18 February 2011 | |
DATE OF JUDGMENT: | 25 February 2011 | |
MEDIUM NEUTRAL CITATION: | [2011] VSCA 41 | |
JUDGMENT APPEALED FROM: | Deputy Commissioner Of Taxation v Georgakopoulos [2010] VCC 1771 (Judge Anderson, 8 December 2010) | |
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PRACTICE AND PROCEDURE – Summary judgment entered against the applicant with respect to alleged tax liabilities – Failure to provide note of proposed contents of appeal book - Appeal taken to be abandoned – Whether applicant’s application for reinstatement of the appeal futile – Whether appeal hopeless – Whether stay of execution of judgment sum appropriate.
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr J D Loewenstein | Alliance Legal |
| For the Respondent | Mr S A Linden | ATO Legal Services |
REDLICH JA
MANDIE JA:
The applicant appealed from a summary judgment granted against him by a judge in the County Court in favour of the Deputy Commissioner of Taxation of the Commonwealth of Australia. The applicant failed to file and serve a note of the proposed contents of the appeal book within the time required by the Rules and as a result the appeal was taken to have been abandoned. The applicant sought an order that the appeal not be taken to have been abandoned.
The applicant’s solicitor explained the failure to file and serve the note of proposed contents of the appeal book within time as being in substance due to his inadvertence over the summer vacation. However unsatisfactory that explanation may be, doubtless the Court would not shut the applicant out from his appeal as a result. That said, the Deputy Commissioner submitted that the appeal should not be revived because it was futile and had no prospect of success.
On 18 February 2011 this Court ordered:
1. That the appeal herein is not taken to have been abandoned.
2.That the time fixed for the filing and service by the appellant of a note of the proposed contents of the Appeal Book be extended to 24 February 2011.
3.That until the hearing and determination of the Appeal there be a stay of execution on the judgment entered in the County Court on 8 December 2010 to the extent that the judgment sum exceeds the sum of $2,267, 961.09 and in relation to the costs ordered by the judgment to be paid by the appellant.
4.That the applicant (appellant) pay the respondent’s costs of this application.
The above orders were made for the following reasons.
The reasons for judgment below, dated 8 December 2010, show that the claim by the Deputy Commissioner related to the alleged taxation liabilities of the applicant in respect of the period from 2002 to 2009.
The judge said that the applicant’s liability for income tax had been reassessed following an audit conducted by the Australian Taxation Office. The judge said that the Deputy Commissioner had produced four certificates dated 8 December 2010 stating that the sums referred to therein were debts due and payable by the applicant to the Commonwealth of Australia. His Honour correctly stated that the said certificates were prima facie evidence of the matters set out in them.[1]
[1]See s 255-45 of the Taxation Administration Act 1953 (Cth) (as amended).
The judge said that the applicant (defendant) had raised three bases upon which he sought leave to defend:
a.A procedural argument under the County Court Rules that the certificates were not served 14 days before the hearing.
b.The assessments were incorrect because certain tax was payable by a trust of which the defendant was a beneficiary rather than him personally.
c.The total amount sought by way of judgment, being the total of the four certificates produced, was significantly different to the amount sought in the statement of claim or a proposed amended statement of claim.
In relation to the first matter, the judge said that it was common practice in summary judgment applications for the Deputy Commissioner to produce certificates on the day because interest and other penalties ran until judgment and it was therefore necessary to prove the amount that had accrued due since the writ and statement of claim had been filed. His Honour added that the affidavit material filed by the Deputy Commissioner proved the matters alleged in the statement of claim and exhibited the relevant notices of assessment and that he considered that in those circumstances the intent of the procedural rules had been complied with and that the Court was entitled and indeed obliged to take account of the certificates filed that day as indicating the amount then due.
In relation to the second matter, the judge said that the substantial defence raised was that the assessments were incorrect. His Honour said that there was no dispute that the assessments supported the claims in the statement of claim (or in the proposed amended statement of claim). His Honour correctly said that the Court was bound to accept those assessments as conclusive evidence of the due making of the assessments and the correctness of the particulars of each of the assessments.[2]
[2]See s 177 of the Income Tax Assessment Act 1936 (Cth).
In relation to the third matter, the judge, in relation to one of the claims, that relating to income tax, said that the difference between the amount claimed in the pleadings and the amount in the certificate ‘presumably’ referred to general interest charges. The judge also noted differences between the amounts claimed in the pleadings and the amounts in the certificates (relating to liabilities for ‘running balance account debt’, administrative penalties and ‘shortfall interest charge’) but his Honour said there was ‘no striking discrepancy’ which would cause him to displace the prima facie position created by the certificates.
Counsel submitted before us that the applicant’s application was not futile because his appeal was neither hopeless nor devoid of reasonable arguments. It was submitted that the service of the certificates on the day of the hearing was contrary to the Rules. It was further submitted that the certificates did not themselves disclose the basis or reason for the differences between the amounts contained in the assessments and the pleadings and the amounts contained in the said certificates and that there was no other evidence before the judge explaining those differences. These points were conceded by the respondent. It was further submitted that, by serving the certificates on the day and immediately before the hearing commenced, the applicant had been denied an opportunity to investigate them and in particular to investigate the basis for or the calculations of the amounts contained therein. It was therefore submitted that the judge was not entitled to order that summary judgment be entered for the amounts claimed as the pleadings and the supporting material did not support such an order (at least for the particular amounts for which judgment was entered), further or alternatively that the applicant was denied a fair hearing in that he was not given an opportunity to investigate the differences in the amounts above referred to.
In our opinion, the applicant’s submissions raised reasonable arguments and the appeal could not be said to be hopeless and accordingly that this application could not be said to be futile.
It was accepted by counsel for the applicant that the material did not make out a case of hardship or other exceptional circumstances such as would justify the grant of a stay of execution in relation to the whole of the judgment appealed from. However we were satisfied that, in the circumstances, a stay of execution pending appeal was appropriate to the extent that the amounts of the judgment exceeded the amounts set forth in the amended statement of claim.
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