Halliday v Commonwealth of Australia - [2000] FCA 950

FEDERAL COURT OF AUSTRALIA
Halliday v The Commonwealth of Australia [2000] FCA 950
TAXATION ‑ Goods and Services Tax legislation ‑ Validity ‑ Whether passed by validly elected Senate ‑ Writs for election of Senators issued by State Governors appointed by Queen ‑ Whether Queen empowered to appoint State Governors ‑ Whether withholding provisions impose civil conscription ‑ Whether laws with respect to taxation ‑ Whether obnoxious to s 118 of Constitution ‑ Whether impose differential taxation ‑ Whether interference with free trade and commerce between States ‑ Whether prohibit free exercise of religion ‑ Application to strike out challenge to validity as disclosing no reasonable cause of action.
The Constitution ss 12, 51(ii), (xxiiiA), 106, 116, 118
Australia Act 1986 ss 7, 10
A New Tax System (Goods and Services Tax) Act 1999, ss 7‑1, 9‑5, 9‑40
A New Tax System (Pay As You Go) Act 1999, ss 12‑190, 16‑25, 16‑70
British Medical Association v The Commonwealth (1949) 79 CLR 201 cited
Alexandra Private Geriatric Hospital Pty Ltd v The Commonwealth (1987) 162 CLR 271 cited
Rogers v The Queen (1995) 64 SASR 280; 130 ALR 635 cited
Tricontinental Corporation Ltd v Commissioner of Taxation [1988] 1 Qd R 474 …
Burton v Honan (1952) 86 CLR 169 cited
Commissioner of Taxation v Clyne (1958) 100 CLR 246 cited
R v Barger (1908) 6 CLR 41 at 70 applied
W R Moran Pty Ltd v Deputy Federal Commissioner of Taxation (NSW) (1940) 63 CLR 338 applied
Cole v Whitfield (1988) 165 CLR 360 applied
Krygger v Williams (1912) 15 CLR 366 applied
Adelaide Company of Jehovah’s Witnesses Inc v The Commonwealth (1943) 67 CLR 116 considered
Attorney‑General (Vict); Ex rel Black v The Commonwealth (1981) 146 CLR 559 considered
Minister for Immigration and Ethnic Affairs v Lebanese Moslem Association (1987) 17 FCR 373 cited
United States v Lee 455 US 252 (1982) considered
ROBERT JOHN HALLIDAY, AUDREY MAY HALLIDAY, LEONARD WILLIAM CLAMPETT, ALFRED ELWYN MATTHEWS, CECIL RONALD RHODES, CAROLYN DORIS RUDDICK-COLLINS, TREVOR JOHN CHAPMAN and BRUCE RICHARD SOCKHILL v THE COMMONWEALTH OF AUSTRALIA, PETER HOWARD COSTELLO (Minister of State for the Treasury) and MICHAEL JOSEPH CARMODY (Commissioner of Taxation)
V 456 of 2000
SUNDBERG J
14 JULY 2000
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

V456 OF 2000

BETWEEN:

ROBERT JOHN HALLIDAY, AUDREY MAY HALLIDAY, LEONARD WILLIAM CLAMPETT, ALFRED ELWYN MATTHEWS, CECIL RONALD RHODES, CAROLYN DORIS RUDDICK-COLLINS, TREVOR JOHN CHAPMAN and BRUCE RICHARD SOCKHILL
APPLICANTS

AND:

THE COMMONWEALTH OF AUSTRALIA
FIRST RESPONDENT

PETER HOWARD COSTELLO
(Minister of State for the Treasury)
SECOND RESPONDENT

MICHAEL JOSEPH CARMODY
(Commissioner of Taxation)
THIRD RESPONDENT

JUDGE:

SUNDBERG J

DATE OF ORDER:

14 JULY 2000

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT:
1.The Application be dismissed as disclosing no reasonable cause of action.
2.The applicants pay the respondents’ costs of the Application, including the costs of the motion notice of which was filed on 5 July 2000, and the costs of the applicants’ abandoned application for interlocutory relief, on an…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read Halliday v Commonwealth of Australia and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2000] FCA 950
Decision Date: 14 JULY 2000

CaseChat Overview and Summary

The case of Halliday v Commonwealth of Australia involved the applicants challenging the constitutionality of the Goods and Services Tax (GST) withholding provisions under section 116 of the Constitution, which guarantees the free exercise of religion. The applicants argued that these provisions infringed on their religious freedoms by compelling them to act contrary to their beliefs. The court was tasked with determining whether the GST laws, including the withholding provisions, violated the constitutional right to the free exercise of religion.

The central legal issues were whether the GST withholding provisions constituted a prohibition or undue interference with the free exercise of religion, and whether they were laws with respect to religion. The applicants contended that the withholding of GST from payments to businesses, unless an Australian Business Number (ABN) was provided, forced them to act against their religious beliefs, which was a breach of section 116. The court examined whether the GST laws were specifically designed to prohibit or had the effect of prohibiting the free exercise of religion, or if they were general taxation laws with no such intent.

In its reasoning, the court found that the GST laws were not laws specifically aimed at prohibiting the free exercise of religion. It held that these laws were of general application for taxation purposes and did not have the purpose or effect of prohibiting religious practices. The court distinguished between laws that directly prohibit religious acts and those that incidentally affect religious practice, holding that only the former would be unconstitutional under section 116. Furthermore, the court noted that individuals could avoid acting as tax collectors by only dealing with suppliers who quoted an ABN, thereby mitigating any religious conflict.

Consequently, the court dismissed the application, finding no reasonable cause of action. The court awarded indemnity costs to the respondents, finding that the applicants' claims were frivolous and should not have been pursued. The court held that the applicants should pay the respondents' costs, including those of an abandoned application for interlocutory relief, as the proceeding was commenced without a reasonable basis.

Orders

Orders of the court

1. The Application be dismissed as disclosing no reasonable cause of action.

2. The applicants pay the respondents’ costs of the Application, including the costs of the motion notice of which was filed on 5 July 2000, and the costs of the applicants’ abandoned application for interlocutory relief, on an indemnity basis.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

SUNDBERG J

The GST laws (including the withholding provisions) do not prohibit the doing of acts in the practice of religion any more than did the military service law in Krygger v Williams. At most they may require a person to do an act that his religion forbids. But that is not within s 116. If the matter be approached by asking whether the law is a law “for prohibiting the free exercise of any religion”, in the sense that it is designed to prohibit or has the purpose of prohibiting that free exercise, the answer must be in the negative. It is plainly a law of general application with respect to taxation. There is no hint of a legislative purpose to interfere with the free exercise of a Muslim’s or anyone else’s religion. Nor is it a law that has the result or effect of prohibiting the free exercise of any religion. A person professing the Muslim faith can avoid committing the sin of acting as a tax collector by ensuring that he deals only with suppliers who quote an ABN. On the view espoused in Lee, the importance of maintaining a sound tax system is of such a high order that religious belief in conflict with the withholding of GST tax is not protected by s 116. When Latham CJ asked whether freedom of religion has been unduly infringed by a law, he was in my view asking a similar question to that posed by Lee. There is no undue interference here. Especially is this so when a person can avoid acting as a tax collector by dealing only with suppliers who quote an ABN. I have canvassed the various “tests” that can be distilled from the cases. But the essential point, in my view, is that the withholding tax provisions do not prohibit the doing of any act in the practice of religion. The claim that the GST law offends s 116 has no prospect of success.CONCLUSION None of the grounds has any prospect of success, and the Application should be dismissed. The respondents have sought costs on an indemnity basis. An order on that basis entitles a party to recover all costs except in so far as they are of an unreasonable amount or were unreasonably incurred: EMI Records Ltd v Ian Cameron Wallace Ltd [1983] Ch 59 at 74 and Helljay Investments Pty Ltd v Deputy Commissioner of Taxation (1999) 166 ALR 302 at 310. Indemnity costs can be awarded when it appears that a proceeding has been commenced or continued in circumstances where an applicant, properly advised, should have known there was no chance of success. See Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 at 401. The present is such a case. In this connection I note that the applicants did not seek to support the first of their claims, and abandoned their claim for interlocutory relief, even though the latter claim was the basis upon which they obtained an early hearing on the ground of supposed urgency.

Ratio Decidendi

Legal Principle Established

Established by: SUNDBERG J

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V456 OF 2000

JUDGE:	SUNDBERG J
DATE OF ORDER:	14 JULY 2000
WHERE MADE:	MELBOURNE