Henderson v Deputy Commissioner of Taxation

[2005] FCA 1574

FEDERAL COURT OF AUSTRALIA

Henderson v Deputy Commissioner of Taxation [2005] FCA 1574

Cannon v Tahche (2002) 5 VR 317 cited

JOHN WILLIAM HENDERSON v NEIL MANN, A DEPUTY COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

VID 1436 OF 2004

SUNDBERG J
MELBOURNE
8 NOVEMBER 2005

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 1436 OF 2004

BETWEEN:	JOHN WILLIAM HENDERSON APPLICANT
AND:	NEIL MANN, A DEPUTY COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA RESPONDENT
JUDGE:	SUNDBERG J
DATE OF ORDER:	8 NOVEMBER 2005
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1.The applicant file and serve a further amended statement of claim on or before 22 November 2005, in default of which the proceeding will stand dismissed.

2.The respondent file and serve written submissions in response to the further amended statement of claim on or before 29 November 2005.

3.The applicant file and serve any written submissions it wishes to make in response to the written submissions referred to in Order 2 on or before 6 December 2005.

4.Costs be reserved.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 1436 OF 2004

BETWEEN:	JOHN WILLIAM HENDERSON APPLICANT
AND:	NEIL MANN, A DEPUTY COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA RESPONDENT

JUDGE:	SUNDBERG J
DATE:	8 NOVEMBER 2005
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1. This proceeding was commenced on 23 November 2004 by an application unaccompanied by a statement of claim.  The application claimed:

   (a)repayment by the respondent to the applicant of moneys obtained pursuant to garnishee notices issued by the respondent;

   (b)damages for denial of natural justice; and

   (c)exemplary damages for the issuance of invalid garnishee notices.

2. On 21 February 2005, Gray J refused the respondent’s motions for orders pursuant to O 20 r 2 of the Rules of Court that the claims referred to at [1](b) and (c) be permanently stayed or dismissed on the grounds that they disclosed no reasonable cause of action, were frivolous or vexatious or were an abuse of the process of the Court.

3. His Honour also ordered the applicant to file on or before 21 March 2005 an amended application and a statement of claim containing full particulars.  Those documents were not filed until 28 April 2005 – and were again filed on 11 May 2005.  (There is no difference between the documents filed on those dates.)

4. The amended application claims:

   (a)repayment by the respondent to the applicant of moneys obtained pursuant to garnishee notices issued by the respondent;

   (b)damages for misfeasance in public office; and

   (c)exemplary damages for the issuance of invalid garnishee notices.

   That is, the amended application replaced the claim for damages for denial of natural justice with a claim for damages for misfeasance in public office.

5. However, the statement of claim alleges that in making certain assessments of the applicant’s taxable income, the respondent:

   (a)“made no assessment of a kind authorised by s 167” of the Income Tax Assessment Act 1936 (Cth); or

   (b)“did not attempt bona fide and in good faith to make any assessment of kind authorised by s 167”.

   The particulars to the allegation at [5](a) state, inter alia, that the assessments referred to therein were made “with the object of creating a device … to justify the issuing of an illegal [garnishee] notice”.  The particulars to the allegation at [5](b) state, inter alia, that “the respondent knowingly issued invalid [garnishee] notices”.

6. On 13 May 2005, the respondent filed notice of a motion for orders pursuant to O 20 r 2 of the Rules of Court that the proceeding be permanently stayed or dismissed on the grounds that it disclosed no reasonable cause of action, was frivolous or vexatious or was an abuse of the process of the Court.  That motion came before me for hearing on 23 September 2005.

7. By written submissions filed on 21 September 2005, the respondent:

   (a)contended that the statement of claim, apart from the particulars to the allegation at [5](b), is “an almost identical copy of the statement of claim filed by the applicant in proceeding V713 of 2004 in which proceeding he seeks orders with respect to certain assessments of income tax”;

   (b)disclosed that on 26 May 2005 he had “advised the applicant that as an alternative to the orders sought in the notice of motion [described at [6]] he would seek an order that the statement of claim be struck out pursuant to O 11 r 16” of the Rules of Court; and

   (c)noted that by an affidavit sworn on 13 May 2005 one of his officers had deposed that the funds obtained pursuant to the garnishee notices referred to at [4](a) and (c) were repaid with interest (the amount in question being $586.44).

8. The respondent went on to submit that the Court ought to:

   ·strike out that part of the amended application described at [4](a);

   ·direct the applicant to file a further amended application “which makes clear that the relief sought [in those parts described at [4](b) and (c)] is directed to the garnishee notices and not the notices of assessment which are the subject of proceeding V713 of 2004”;

   ·strike out the statement of claim “on the basis that (with the exception of [the] particular [described in the last sentence of [5]]) it does not relate to the relief sought in the proceeding, alternatively because it is an abuse of process”; and

   ·give the applicant “a further period to file a proper further amended application and [amended] statement of claim in default of which the proceeding be dismissed”.

9. At the conclusion of the hearing on 23 September 2005, I ordered that, on or before 10 October 2005, the applicant file and serve either a written response to the respondent’s written submissions or a further amended application and amended statement of claim.  I also ordered that, on or before 14 October 2005, the respondent file and serve any reply to the same.

10. On 10 October 2005, the applicant filed both a written response to the respondent’s written submissions and a further amended application and amended statement of claim.  On 14 October 2005, the respondent filed further written submissions in reply to the same.

11. The further amended application claims:

    (a)repayment by the respondent to the applicant of moneys obtained pursuant to garnishee notices issued by the respondent;

    (b)“personal and general damages for misfeasance in public office for the issue of invalid garnishee notices”; and

    (c)exemplary damages for the issuance of invalid garnishee notices.

12. [11](b) makes clear that the allegation of misfeasance in public office is confined to the respondent’s conduct in issuing invalid garnishee notices.  The written submissions referred to at [10] support this.  Paragraph 5 thereof sets out elements of that tort as they apply to the proceeding.  In particular, that para states “[t]hat the respondent maliciously exercised that power [ie to issue garnishee notices] with the intention of causing the applicant injury or with reckless indifference as to the probability of causing … injury” and cites Cannon v Tahche (2002) 5 VR 317 at 330 where it was “held that as the essence of the tort is an abuse of power, the [relevant] act or omission must have been done or made with the required mental element”. By para 6, “the applicant submits that the necessity of proving the mental element of misfeasance in public office distinguishes” the instant proceeding from proceeding V713 of 2004.

13. However, the amended statement of claim is laconic in the extreme.  It is as follows:

    “1. At all material times the Respondent was an officer of the Commonwealth holding office as a Deputy Commissioner of Taxation of the Commonwealth of Australia under the provisions of the Taxation Administration Act 1953 (Cth) (the Administration Act) capable of suing and being sued pursuant to the law of the Commonwealth of Australia.

    a.The Respondent knowingly issued invalid notices under s 260-5 of Schedule 1 of the Administration Act.

    Particulars

    b.In an attempt to validate the said notices the Respondent issued invalid Notices of Assessment referred to in the Statement of Claim in proceeding V713 of 2004.

    c.The Applicant relies upon a number of acts committed by the Respondent as proof that the Respondent knowingly issued invalid garnishee notices for an improper purpose.  Pursuant to further Court Directions or Orders the Applicant seeks leave to specify these in a further Affidavit to be filed and served by the Court.”

    (Sub-paragraph (a) is probably meant to be para 2.  The matters in sub-paras (b) and (c) are probably meant to be particulars (a) and (b) to para 2.)

14. The amended statement of claim is embarrassing and I will order that it be struck out pursuant to O 11 r 16 of the Rules of Court.  The applicant – at least through his brother, whom I gave leave to make submissions on his behalf at the hearing and who seems to have had a hand in the preparation of the documents referred to at [10] and the conduct of the proceeding generally – is aware of the elements of the tort of misfeasance in public office: see [12].  In particular, he is aware of the need to establish the requisite mental element.  However, it is nowhere to be found in the amended statement of claim.  The respondent concedes that the issuance of the garnishee notices was invalid because they were served before the notices of assessment at issue in proceeding V713 of 2004 were served.  However, invalidity alone is insufficient to make out a case of misfeasance in public office.  That deficiency is not cured by the particulars.  First, the reference to the notices of assessment at issue in proceeding V713 of 2004 is neither here nor there.  Secondly, the request for leave to file a further affidavit – which is repeated at para 18 of the written submissions referred to at [10] – is misconceived: the applicant should state in his pleading what specific acts he relies upon.  (I also note that the amended statement of claim fails to plead upon whom the garnishee notices were served.)

15. I will also order that the claim in the further amended application for repayment by the respondent to the applicant of moneys obtained pursuant to garnishee notices issued by the respondent be struck out.  It has been rendered nugatory.  The repayment referred to at [7](c) was by cheque drawn in favour of William Marijancevic – the name in which the applicant commenced proceeding V713 of 2004.  The respondent has, by an affidavit sworn on 18 October 2005 by one of his officers, indicated that he has drawn a replacement cheque in favour of the name in which the applicant commenced the instant proceeding and delivered that cheque to the applicant’s brother.

16. By its further written submissions, the respondent submitted that:

    “None of the Applicant’s various materials support an allegation that this act [ie the issuance of the garnishee notices] was done maliciously, as opposed to erroneously.  No motive or facts to support such an allegation have been presented.  While it is accepted that as an unrepresented party the Applicant is entitled to some leeway which it comes to the formulation of his claim, that claim must still have a factual basis.
    …
    Unless the Applicant can plead material facts, on some genuine basis, that satisfy the elements of the tort [of misfeasance in public office] the claim is hopeless and the proceeding ought be dismissed.”

    What the respondent says is correct.  At the moment, the applicant is a long way from a tenable claim.  However, I will not dismiss the proceeding.  Rather, I will grant the applicant a final opportunity to put his pleadings in order.

17. By his written submissions, the applicant asks the Court to indulge him in relation to the conduct of the proceeding generally.  He is unrepresented and without legal training.  His brother is also without legal training.  At the hearing, the applicant also explained to the Court the difficulties involved in running the proceeding from the prison where he is on remand.  He also complains that the respondent has not acted as a “model litigant”.

18. The Court is aware of the difficulties faced by unrepresented litigants generally and the applicant particularly.  He has already been indulged to a considerable extent.  The proceeding has been on foot for nearly a year.  In that time, and allowing for the fact that he is an unrepresented litigant, he has, despite numerous opportunities, failed to put his pleadings in order.  By the late filing of the documents referred to at [3], he secured a significant amount of extra time.  He is about to be given another opportunity to put his pleadings in order.  Moreover, his written submissions – particularly that part described at [12] – tend to suggest that his “disadvantage” is not as significant as he would have the Court believe.

19. The motion referred to at [6] remains extant.  I will not dispose of it yet.  Rather, I will order that:

    (a)the applicant file and serve a further amended statement of claim on or before 22 November 2005, in default of which the proceeding will stand dismissed;

    (b)the respondent file and serve written submissions in response to (a) on or before 29 November 2005; and

    (c)the applicant file and serve any written submissions he wishes to make in response to (b) on or before 6 December 2005.

    I will decide the motion on the basis of the material filed pursuant to (a) to (c).  If no material is filed pursuant to (c), I will decide the motion in its absence.  I will also reserve costs until then.

I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Sundberg.

Associate:

Dated:             8 November 2005

The Applicant appeared in person with his brother making submissions on his behalf.
Counsel for the Respondent:	S Sharpley
Solicitor for the Respondent:	Australian Government Solicitor
Date of Hearing:	23 September 2005
Date of Judgment:	8 November 2005