Lombardo, Dante v Commissioner of Taxation of the Commonwealth of Australia

[1979] FCA 15

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IN THE FEDERAL COURT v.>--

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WESTERN AIJSTR.4LIA L ) I S T R I C T REGIST!?Y) W. A . G . No. G 2 6 oc 1';

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GENERAL D I V I S I O N )

RETdEEN:

DANTE LOXDARDO

AND :

m- 5 March 1979.

REASONS FOR JL'DGI.IE:XT

The taxpayer s eeks i cave t c appea l i ~ g a i n s t 3

d e c i s i o n of t h e Supreme Court of Western A u s t r ~ l i a

d i s m i s s i n g h i s appea l fro,^ a ( l e c i s i o ~ ~ of a B3zi-Ci ~f

XeirLcw conf imi ing assessnlcl:t:, of j~:c.on~c? t a x r u a a t ? . -

r e s p e c t of t h e ycars cr~dcd 30 june 1966, 1969 &c3 19;:

SJickhm J. he ld thdt i ~ e h:lci r ~ i , jur isdic ' ; ;cn 1.1

e n t e r t a i n t he tippeal, addin&:

I I

. . . t h a t slloulcl L l>:. ifrsilS L I I t h a t

conc lus ion , I ha: L bea rd thz ~ . ~ l ' c i e ~ ; c e of

ti l t . p.irLics 2nd t h e i r \ J I : I ! ~ L ~ L ~ , - , L . ~ d I BIJ

i n u p c s ~ t i o n i.o .i,nkc a d e c i ~ i i ) ~ ; . .. <hc)IrlC:

thc c a s e go any Curcl-,rr ~ ~ - 1 1 rcrurl-:eti i;o

I I

me f c r t h a t pl?r:-o.. - .

Section 25(2 ) of the Federal Court of Australia Act 1976 enables an application for leavc to appeal to be heard and determined by a single Judge or by a Full Court. The application came before me as a single Judge. This hss

some implications that I shall mention in thesc rc,, A - r a n ~ .

The merits of the application were canvassed at some length by counsel for the taxpayer and the Commissioner and in view of the relative novelty of the application

I reserved my decision.

Section 196 (5 ) of the Income Tax Assessment ~ c t

1936, that makes Leave to appeal necessary, docs not

define the circumstances in whlch leave may be given nor

does it prescribc any criteria to be applied. Neverthclrss

there are provisions in the Act which throw sornt light

upon the exercise of this discretionary power.

Section 196 (5 ) itself contrasts the "lcave"

required to appeal to the Fcderal Court with the "spccial

leave" required to appeal to the High Court. Similar

expressions appeared in S. 35 of the Judiciary Act 100 3 ,

as it stood until 1976, although the rcfercnce to lc.1~~.

to appeal was in relation to interlocutory jud~ll~c~~~e

wherc otherwise an appeal would lie as of right. ~ o z

that reason the judgment ic Ex ?arte Buckncll (1335)

56 C.L.R. 2 2 1 is not entirely in point. But in thc collrse

of a joint judgment the Court emphasised thet in t h c c ~ s c

of an application for special leave,

"there rrlust be spccial circumstances in the

case in order to justify the granting of thc

application. ... But, in Lhe case of orders

from which an a p ~ c n l dot? not Lie without- 1c:~vc

! 8 . 1 . , ,

. . .. i %I-.,,: J r j s . # L - y , i : - I S:

Lrcjr~ t,-.c- :.z . . (:: L':L: sec t ~ . o n th~L Lhc: c~I:-Lc:,.-,

of speclcil cl rcu ir.jt-.!nccr; is not nndc necess:iry

in order to justify the grant of leave tu

appeal" (at p. 224).

Likewise , alt110~l;h Ft may be a t tcbL :i negati.ve

c o n s i d e r a t i o n , t he e x i s l c n c c of s p e c i a l circum:;t,~nccs

i s n o t neces sa ry be fo rc l eave t o appezl Lo the Federa l

Court may be g ran ted .

S e c t i o n 196(1) of t h e Income rcix Assessmc,nL- AcL

prov ides f o r an appea l t o a Suprcn~e Ccur t f r o l , ~ a11y

d e c i s i o n of a Board " t h a t i nvo lves qucsLion of !nw"

The meaning of t h a t e x p r r s s i o n has been cclnvns',cti i n a

number of d e c i s i o n s . See f u r insLancc IZrcw v . I ~ L d t r , l l

Commissioner of Tnxntlon (1971) 45 A.L . J .R . 325,

(1971) 7 1 A.T.C. 4212. I t 1 s n o t neces sa rv to r e f e r t o

them; t h e p o i n t i s t h a t t he involvcmint of a q u i s t ~ o n

of law i s a l l t h a t i s neces sa ry t o ground an ~ 1 ~ , 2 i z !

from a Board t o n Supren~e Co:lrt. 2'0 appea l f r o r i ~ a

Supreme Court t o t h e Fede ra l Court l ezvc i s reqc~lrc:d.

The conc lus ion i s i n e v i t a b l e Lhnt Lhe existel:cc of a

q u e s t i o n of l a w i s n o t of i t s c l f cnough t o ws~-r,lnt ~ l > . ~ t

l eave . Something e l s e i s r equ i r ed . A q u e s t i r > n of lai: t 'l.it

1s impor tan t o r of g e n e r a l application i s , no t i r r ~ r ' ~ t . ,

sufficient bu t t h c r e may be o t h c r c o n s i d e r a t ~ o n s t h : ~ t

j u s t i f y l eave .

Thc n o t i c e of appea l t o t h c Supreme do~.~r :

i d e n t i f i e d Lhe quesl . ior~s of l a w involvcd i n LIIC (ILL I $L01

of t h e Bo3rd i n t h i 5 way:

"l. The proper c o n s t r u c : ~ o n of sec tic;^ 2G(n!

of t h e Inconk TAX Assess~ninL Act 1S)?6.

2 . Whrthcr t he kpp t . l l :~n t acqui red l i d s I ; ' ! i r e ,;l.

i n Lhe p r o p i , r - ~ i e s r c f c r ~ e d t o ~ I I thi. rlcci ~ L ~ I I

I I

of the Board of Review as H c l m Strerl-" anci

I I Clay Land:," f o r Lhc purposi: of p r o f ~ L I ~ I : I ~ ~ : I ,

1 ,

t.7; - . l ! ? .

Before t h e Supreu~e C.ourt t h e Co~iullj.ssioner submitted

t h a t no q u e s t i o n of liiw was involved. Wickham J .

r e s e r v c d d e c i s i o n on t h a t q u e s t i o n u n t i l hc hLld heard

t h e ev idence ; i n t h e end he accep ted t h c subnii.ssi on.

~ l t h o u g h s e v e r a l questions of law were claimer!

by t h e taxpayer t o be a t l e a s t p o t e n t i a l l y i n v o l v ~ d I n

I I

t h e d e c i s i o n of t h e Board, Lhe important c l~ lcs t ic~n"

s a i d t o war ran t l eave w a s whether a t axpaye r , a s s e s s e d

under t h e p r o v i s i o n s of s .26(a ) of t h e l n c o ~ ~ ~ c Tax

Assessrne?it A c t , can appcnl t o n S~~prcn le Court a g a i n s t

. .	-
iii "... ." '.. 'l.,. ... . 0 ,~.-

a d e c i s i a n G: a Eoard ;f Rc-;i;v. " L J v L L W C L L C \ , 11C i C L<,,

cannot be p r o f f e r e d i n t h a t wlde form. Thcrc ~zay be

d e c i s i o n s of a Board concerning an a:,scssment under

S . 26(a) t h a t i n c o n t e s t a b l y involve a qut+st ion ~ f l&\/,

hence a r e appea l ab l e . Deci , ; ions tur1,in; on t he m e n n i p r

I t

of "acquired" , "purpose" and p r u f ~ t ~n:ikiilg by sdlr"

f a l l i n t o t h l s ca t ego ry .

was r e a l l y say ing was Lhat t h e a p p l i c a t ~ o n of a hLatuf-r,ry

p r o v i s i o n sus11 as s.?f>(:t) Lo the f a c t s ,IS fo,lnd ("1 1 1

always involve a qucsLio11 of l a w , c\,en whc>n t l > t 7 c.o. -, , , l .

f a l l s s h o r t of s ~ l y l n g t h a t t h c r e w:is r!o c v i d c n ~ c or: ; - l .:

t h e Board might reasonably have reached i t s c ~ ~ n c l u s i - ,

Wickh'ml J . d l d n o t a c c e p t Lhjs. F1c took a s h i s s::~r: I I . :

polnt. a [ I ~ S L ~ S C . from thc ] L I O j r ~ ~ c n t of F ~ ~ l l a ~ ~ ~ i - .I. I 11

tlavcs v . F~,d::l-al Corlu111 sL.-~,rlcr- of T,ix:it-]on ( 1 9 5 t ) ! ' c . l . I :

-

47 'it p .51:

"Where t he fnc t : l - l , p~-,,I,anduri J i ~ v n l v e s ,l tc7rn

115(:d I n a s l a t u i - , L h c <jU.!>!:Jill~ whcthcl- Llie

,, . I 1 , . , 1-1 ,

*'!L. . ! c .

1 can CC,, . i l ~ : . : - < ~ . :,I- <.I (~: IC: .LLOII oi l:;\:''.

Wjckl~am J . was cf Lhe view t h a t F u l l a k a r . I .

w a s s imply r e s t a t i n g what had bcen s a i d by L,itl::~rn C..J.

i n C o m i s s i o n e r of Taxa t ion v. M l l l e r (1946) 73 C.I..R. 93

a t 97 a n d what had been s a i d e a r l i e r by Lord ?,lrker 117

Farmer v. c o t t o n ' s T r u s t e e s (1915) A.C. 922 a t p.933.

There i s a d l f f e r e n c c of language Involved; t he e a r l i e r

c a s e s cxprc!ssly inLroduccd the e l e ~ r ~ e n t of constructi .vn

by speaking of " the provisions p r o p e r l y cons t rued of

sornc s t a t u t o r y enactment". \.?lcth,?r i n t he cnJ L l i c t h r e c

Judges were clppljrin, t he 5amc t e s t may bc a rguab lc .

S i t t i n g as s s i n g l e Judge, h e a r ~ n g an a p p l l c a t l o n f o r

leave t o a p p e a l , I do n o t t h i n k i t i s f o r m e t o t r y ~o

r e s o l v e t h a t a:i;llmcnt. My i n q u i r y shc~ulcl be di r i cL id

;o t he e x i s t e n c e of ac a rguab lc q l lcs t lon , t he i n p l i ~ a t ~ o ; ~ :

of t h a t q u e s t i o n f o r t h c c a s e i n hand and, i f urgcd s s a

reason f o r l e a v e , I L S wiclcr joll~1icatlon.s.

The c o r r e c t n e s s o r ot t lerwise of t h e dcc i r i c~ r l

cha l lenged nay be a r e l e v a n t cons ideraLion when Lhc

a p l , l i c ~ t i o n	i s be fo re	a	F u l l Cour t .	Frcder ic l -S v .	!lnv
--

(1973) 47 A . L . J . R . 362. .C:j.tLing as a s l n g l e Jc.d;e,

l r a ~ - t i c u l a r l y whcn Lhc c o r r c c t n r . . ; ~ of Lhe d e c i s i o n

11ot f : ; l ly al-,:uc.d, ~ : - I L ) s j t ~ : . ~ t ii:n I.= (11 f f c r e n t . 1; ~ L ~ I , C

i s gr ' lntcd, Lhe I k l l Court 1:; n o t bound by any v ~ i v r C

t h c l a w 1 t dke , ba t ~ t silenis Lo rnc u n d c s ~ r a h l c t ' :~ : l t :.

s l n g l e Judgc should srnnl: l eave on the ba:,is tli;ar I 11 ,

d e c i s i o n af t h e Suprc11.e Court xris !:ron&. That 15 ' 1

n ; n t t c r f a r t hc F1111 C d u ; t .

I f l e avc i s grnntcd and 1-tie a p ; x a l i s uy,licld,

t he m a t t e r w i l l be r en j - t t ed 1-0 Wickham J. I t nqay IJL

t h a t from h l s l l o~ iou r ' s d e c i s i o n l eave Lo appea l w i l l

a g a i n be sought , e i t h e r by the taxpayer o r t h e

Corr~missioner. That should n o t s t and i n Lhe way of

t h i s a p p l i c a l i o n . For Lhj s tnxp.lyer buLh t a a t i a l s u : , ~ ~

of income t a x are involved , n o t on ly i n r e t p e c t of

t h e y e a r s a s s e s s e d b u t , I a11 t o l d , i r ~ rcgarcl t o

l a t e r y e a r s f o r which assessments w l l l be r a i s t d

a r i s i n g o u t of t h e some t r s n s d c t i o n s . Thc taxpayi r ' s

r e f r ~ r ~ q c e	t o tile 5oar.l ..vzs !?e?rd j p ~ z t !	- 7	: r j	L!?	! : !?PS-
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of h i s f a t h e r and b r o t h e r . T h e ~ r asscssrncrlts were

con£ irmc-d 311d the co~~ ipe L ncy of Lllclr .~lq,e:li 1, ; J ~ I Y I . .I -

i n t he Suprcrnc Cour t , w i l l b~ a f f c c t c d , i f n:)L ( ! c l 1-r, . l l 3 . . i ,

by a d c c l s i o n on ari appea l t ~ y tl11s taxpaycr .

I n my view t h e s e a r e good reasons f o r SrL~ntLn,

l eave t o a p p e a l , c s p ~ c i n l l y as t h e r e i s a r1~1c::t I:);I l , +

l a w t o be a rgued , t h e answer t o ~ i t i l c h vay throb%, 1 1 <l'-

on t h e scope of	a p p e a l s from Boards of Revie;< t o S:II,L~I:,:
CourLs.

There w i l l be lpavc- Lo the Laxpayer t o .?- l>~cL~I

!,t t h s r e q u e s t of t h e p a r t i e s I restervc t h i ( luescit*, c81

c o s t s . I f t h e r e i s any o t h e r n u t t e r a r l s j r ~ g frorn :l:&.

r e a sons , r e q u i r i n g di r~ 'cLi011s o r any p r o ~ ~ : c ~ u r a I . UTL!L :-.

eiLtier parLy nay apply i.:~tt1111 1L( day:.