KPTT v Commissioner of Taxation

[2021] FCA 464

FEDERAL COURT OF AUSTRALIA

KPTT v Commissioner of Taxation [2021] FCA 464

File number(s):

NSD 42 of 2021

Judgment of:

JAGOT J

Date of judgment:

5 May 2021

Catchwords:

PRACTICE AND PROCEDURE – whether identity of applicant should be suppressed – Court’s power to make suppression and non-publication orders – whether suppression orders necessary to prevent prejudice to the proper administration of justice.

Legislation:

Administrative Appeals Tribunal Act 1975 (Cth)

Administrative Decisions (Judicial Review) Act 1977 (Cth)

Federal Court of Australia Act 1976 (Cth)

Judiciary Act 1903 (Cth)

Taxation Administration Act 1953 (Cth)

Cases cited:

Rinehart v Rinehart [2014] FCA 1241; (2014) 320 ALR 195

The Country Care Group Pty Ltd v Commonwealth Director of Public Prosecutions (No 2) [2020] FCAFC 44; (2020) 275 FCR 377

Division:

General Division

Registry:

New South Wales

National Practice Area:

Taxation

Number of paragraphs:

20

Date of hearing:

Determined on the papers

Solicitor for the Applicant:

Stratos Lawyers

Solicitor for the First Respondent:

Minter Ellison

ORDERS

NSD 42 of 2021

BETWEEN:

KPTT

Applicant

AND:

COMMISSIONER OF TAXATION

First Respondent

ADMINISTRATIVE APPEALS TRIBUNAL

Second Respondent

ORDER MADE BY:	JAGOT J
DATE OF ORDER:	05 MAY 2021

THE COURT ORDERS THAT:

1.The applicant be identified in the proceeding by the applicant’s name rather than by the pseudonym “KPTT”.

2.Order 1 be stayed for a period of 28 days.

3.The applicant pay the first respondent’s costs of and in connection with the issue of suppression of the applicant’s identity in the proceeding as agreed or taxed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

JAGOT J:

1. In January 2021, the applicant filed an originating application for judicial review of decisions of the Administrative Appeals Tribunal (the AAT) in which the applicant’s identity was suppressed by the pseudonym “KPTT”. This pseudonym was given to the applicant by the AAT by orders made during the course of the proceedings before it (the AAT proceedings). The AAT’s decisions do not finally dispose of the application before it and the AAT proceedings are continuing.

2. At a case management hearing on 30 March 2021, counsel for the first respondent (the Commissioner) submitted that the applicant should not retain the pseudonym in the proceeding filed in this Court (the FCA proceedings). The applicant submitted to the contrary. As the use of the pseudonym in this proceeding was the result of the form in which the applicant filed the originating application and not any order of the Court, I invited the parties to make written submissions in support of their positions.

3. The applicant and the Commissioner provided written submissions on 7, 13 and 20 April 2021.

4. Section 17(1) of the Federal Court of Australia Act 1976 (Cth) (the FCAAct) provides:

   Except where, as authorized by this Act or another law of the Commonwealth, the jurisdiction of the Court is exercised by a Judge sitting in Chambers, the jurisdiction of the Court shall be exercised in open court.

5. Part VAA of the FCA Act relates to the making of suppression and non-publication orders. Section 37AE of the FCA Act, under the heading “[s]afeguarding public interest in open justice”, provides:

   In deciding whether to make a suppression order or non-publication order, the Court must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice.

6. The relevant provisions for suppression and non-publication orders are ss 37AF and 37AG of the FCA Act. The applicant relies upon s 37AG(1)(a) which provides that the Court may make such orders where “the order is necessary to prevent prejudice to the proper administration of justice”.

7. The relevant principles were identified in Rinehart v Rinehart [2014] FCA 1241; (2014) 320 ALR 195 at [21]-[31] (cited with approval in The Country Care Group Pty Ltd v Commonwealth Director of Public Prosecutions (No 2) [2020] FCAFC 44; (2020) 275 FCR 377 at [8]), and can be summarised as follows:

   (a)orders made under s 37AG must be “necessary” to prevent prejudice to the administration of justice and thus should only be made in exceptional circumstances;

   (b)the Court’s departure from open justice can only be justified where its observance would frustrate the administration of justice or a public interest for whose protection Parliament has modified the open justice rule;

   (c)the primary objective of the administration of justice is to safeguard the public interest in open justice;

   (d)publication can only be avoided where necessity compels departure from the open justice principle;

   (e)the entitlement of the media to report on court proceedings is a corollary of the right of access to the court by all members of the public;

   (f)parties must accept the damage to their reputation, and the possibility of consequential loss, which may be inherent in being involved in litigation; and

   (g)there are exceptions to the principles of open justice, such as cases involving blackmail or disclosure of information that would seriously affect the commercial value of the subject matter by revealing information to competitors.

8. It is apparent that proposition (g) provides examples only and does not purport to be an exhaustive list of circumstances in which it may be concluded that it is necessary to make a suppression or non-publication order to prevent prejudice to the administration of justice.

9. During the course of the AAT proceedings, the AAT made and thereafter refused to set aside or vary orders suppressing the identity of the applicant and witnesses (the AAT orders). Section 35 of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) provides:

   (1)Subject to this section, the hearing of a proceeding before the Tribunal must be in public.

   …

   (3)The Tribunal may, by order, give directions prohibiting or restricting the publication or other disclosure of:

   (a)       information tending to reveal the identity of:

   (i)        a party to or witness in a proceeding before the Tribunal; or

   (ii)any person related to or otherwise associated with any party to or witness in a proceeding before the Tribunal; or

   (b)information otherwise concerning a person referred to in paragraph (a).

   …

   (5)In considering whether to give directions under subsection (2), (3) or (4), the Tribunal is to take as the basis of its consideration the principle that it is desirable:

   (a)that hearings of proceedings before the Tribunal should be held in public; and

   (b)that evidence given before the Tribunal and the contents of documents received in evidence by the Tribunal should be made available to the public and to all the parties; and

   (c)that the contents of documents lodged with the Tribunal should be made available to all the parties.

   However (and without being required to seek the views of the parties), the Tribunal is to pay due regard to any reasons in favour of giving such a direction, including, for the purposes of subsection (3) or (4), the confidential nature (if applicable) of the information.

10. Section 14ZZE of the Taxation Administration Act 1953 (Cth) (TA Act) also provides:

    Despite section 35 of the AAT Act, the hearing of a proceeding before the Tribunal for:

    (a)a review of a reviewable objection decision;

    …

    is to be in private if the party who made the application requests that it be in private.

11. Section 14ZZE of the TA Act applies to the AAT proceedings.

12. It is not necessary to resolve the dispute between the parties as to whether the AAT made the suppression orders relying on s 35(3) of the AAT Act or s 14ZZE of the TA Act. In my view, while it is clear that the power the AAT exercised was under s 35(3) of the AAT Act for the purpose of facilitating the operation of s 14ZZE of the TA Act, the real issue is whether the fact that the AAT proceedings are continuing means a suppression order in this FCA proceeding is necessary to prevent prejudice to the administration of justice. That prejudice, according to the applicant, is that if the applicant’s identity is disclosed in the FCA proceeding it will in effect: (a) render nugatory the suppression order of the AAT as to the applicant’s identity in the AAT proceeding, contrary to s 14ZZE of the TA Act, and (b) render nugatory the suppression order of the AAT as to the identity of witnesses in the AAT proceeding, contrary to s 14ZZE of the TA Act. If the AAT proceedings were not continuing, the applicant accepts that the applicant would have no basis for seeking a suppression order in the FCA proceeding.

13. I am not satisfied that it is necessary to make an order suppressing the applicant’s identity in the FCA proceeding to prevent prejudice to the proper administration of justice.

14. First, the AAT’s order will remain in place for the purpose of the AAT proceeding. The hearing before the AAT will remain private and the identity of the applicant, relevant witnesses and documents produced by the Commissioner will be suppressed in the AAT’s reasons for decision. The refusal to make any suppression order in the FCA proceeding will not have the effect of setting aside the AAT’s order.

15. Second, this is not a proceeding under s 14ZZE of the TA Act. It is a proceeding under s 39B(1A)(c) of the Judiciary Act 1903 (Cth). The FCA Act does not contain a provision equivalent to s 14ZZE of the TA Act. In this Court proceedings are to be in public subject only to Part VAA of the FCA Act and any other law: s 17 of the FCA Act.

16. Third, other than the making of the AAT orders, there is no evidence that the disclosure of the identity of the applicant, or any consequential disclosure of the identity of witnesses or the substance of the documents produced by the Commissioner, will itself prejudice the proper administration of justice other than insofar as s 14ZZE of the TA Act applies to the AAT proceedings.

17. Fourth, and as a result, the issue of necessity involves the question of whether any adverse impact on the AAT proceedings amounts to a prejudice to the proper administration of justice in and by the AAT in circumstances where the proper administration of justice in this Court ordinarily involves a hearing in public.

18. Other than the mere fact of the AAT orders, which will remain in place for the purpose of the AAT proceedings, nothing in this case makes it necessary for a suppression order to be made in this Court to prevent prejudice to the proper administration of justice.

19. I will make orders accordingly, including an order for a stay of 28 days to preserve the applicant’s anonymity pending any potential application for leave to appeal.

20. Given that the applicant filed its originating application assuming a right to preserve anonymity and opposed any identification of the applicant, costs should follow the event.

I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot.

Associate:

Dated:    5 May 2021