Marina Estates Pty Ltd v Commissioner of Taxation

[1986] FCA 198

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RESTRICTED DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA	)
OUEENSLAND DISTRICT REGISTRY	) QLD G9 of 1986
GENERAL DIVISION	)

BETWEEN :

K9RINA ESTATES PTY.LTD.

Appllcant

AND :

THE COE.1MISSIONER OF TAXATION

OF THE COMMC!NWEF.LTH OF

AUSTRALIA

Respondent

Gn conslderztion, I have reached the concluslcn that he

proper course for me to adopt 1 s to decline to determine whetner leave t o appeal should or should not be granted and to dlrect that the application for leave to appeal from the judgment of M E . Justice Enderby In the Supreme Court of New South Wales be heard

by a Full Court of the Federal Court.

The clrcumstances leading to thls concluslon are these:

Marina Estates Pty.Ltd. lodged objections agamst

assessments in respect of income derlved by it for the year

endlng 30 June 1977, and for the period 1 July to 9 August 1972,

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notices of which were issued on 15 August 1972. The objections were disallowed by the Commissioner, and the taxpayer requested that the decision be referred to a Board of Review. The Board of

Review No.2 conflrmed the assessments on 22 March 1984. The

notices of objectlon contained many grounds, some being of fact

and others of law, Pursuant to s.l96(1) the taxpayer appealed to

the Supreme Court from the declsion of the Board. Section

196(l) of the Income Tax Assessment Act 1936 provides:-

"The Commlssloner or the taxpayer may appeal to a

Supreme Court from	any decislon of the Board that
lnvolves a question	of law."

The taxpayer appealed by a Notlce of Appeal dated 3 May

1984, whlch was filed In the Supreme Court of Queensland m 31

May 1984. On 3 May 1985, Ryan J. of the Supreme Court of

Queensland made an order pursuant to s.184C of the Income Tax

Assessment Act transferrlng the matter to the Supreme Court of

New South Wales. The taxpayer then flled a Notice of Motlon

seehng to amend the Notlce of F-ppeal, whlch was heard by Enderby

J. on 2 0 December 1985. The broad purpose of the appllcatlon to

amend was to Include grounds whlch had. been set out In the

origlnal Notlces of Oblection but whlch had not been argued

before the Board of Revlew. On that day his Honour refused the

applicatlon. Other matters for	hls Honour's determinatlon were
ad-~ourned.

On 5 February 1986, a document headed "Applicatlon for

Leave to Appeal" was filed in the General Division of the

Queensland Dlstrlct Registry of the Federal	Court of Australia.
That document recites:-

3 .

"1. The applicant applies for leave to appeal from

the ludqment of the Honourable Mr. Justice Enderby

in the Supreme Court of New South Males.

2. Leave to appeal is required by section 196(5)

of the 'Income Tax Assessment Act 1936'.

3 . The grounds of	the applicatlon appear	In the
annexed affidavlt.

4. The applicant applies for an order that

compliance with Order 52 sub-Rule 5(2) be

dlspensed wlth."

On Its face, there is nothing to suggest that the

applicant wlshes the appllcation to

be heard by a slngle judge or

by a Full Court.

Sectlon 196(4! provides:-

"Except as provlded m sub-sectlon 5, an appeal

does not lle from the decislon of a Supreme Court

constltuted by a slngle Judge	on an appeal or
reference under thls section."

And 196(5) provides:-

"The Commissioner or the taxpayer may appeal

against a declslon of a Supreme Court on an appeal

or reference under thls section -

(a! by leave of the Federal Court of Australia

to that Court; or

!b) by special leave of the Hlqh Court, to that

Court. ' I

(I note, in passing, that in the course of discussions before me

the question was posed whether the decision of Enderby J.

refuslng the applicatlon to amend the Notice of Appeal to the

Supreme Court 1 s a "decislon" to which s.196(5) applies.)

4.

The matter was listed by the Registrar before me and,

when the matter was called on, senior counsel for the taxpayer at

the outset said that it wished the application for leave

determlned by a Full Court. He frankly stated that "the matter

was set down today wlthout there being awareness of the decision

of the Full Court in v. Nalrn 60 A.L.R. 419."

The applicant's request was not based on s.25(6) of the

Federal Court of Australia Act, 1976. The dllemma confronting

the applicant 1 s based on the provlsions of s.25(2) of the

Federal Court of Australia Act 1976, which provide:-

" ( 2 ) Appllcatlons for leave or speclal leave to

appeal to the Court or for an extenslon of time

wlthln whlch to instltute an appeal may be heard

and cletermlned by a slngle ]udge or by a Full

Court and the Rules of Court may provlde for

enabllng such appllcatlons to be dealt wlth,

sub~ect to condltions prescrlbed by the Rules,

wlthout an oral hearing."

In v. Nairn (1935) 6 0 A.L.R. 419, the Full Court of

the Federal Court consistlng of Fox, Forster and McGregor JJ.,

concluded that the question of leave to appeal to the Federal

Court is to be decided by either a single ~udge or the Full

Court, whlchever 1 s first seized of the matter. They are true

alternatives and not progressive, and thus there is no appeal

from a declsion of a slngle judge refusing or granting leave to

appeal. Hence, a party wishing to appeal from an interlocutory

order must elect whether a slngle judge	or	the Full	Court be
approached.

.

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Here the short point for the taxpayer is that there has

never been an election by it as to whether the application for

leave to appeal should be heard by a single judge or by a Full

Court and, in those clrcumstances, it now indicates that it wants

the question of whether leave should be granted to be determined

by a Full Court of the Federal Court.

The declslon In R - v. was followed by a

Full Court, constituted by Smlthers, Lockhart and Neaves JJ., m

General Motors Holden's Llmited	v. Noack, (unreported, 7 March
1986).

Those cases establish that, had there been an electlon

to have the questlon of leave determined by a slngle judge, that

s~ngle judge's declsion as to whether or not leave should be

granted would not be able to be reviewed In any manner by a Full

Court. A s the jolnt judgment of Fox and Foster JJ. in Reid v.

Nalrn (supra) at 421 indicates:-

" A party wlshing to appeal from an interlocutory

order has to make an election whether the ludge or

a Full Court should be approached for leave. "

It follows that whether the applicatlon for leave is to be heard

by a single judge or by a Full Court is a matter of choice for

the taxpayer in the present instance. I do not think the

applicant's mind turned to that choice until shortly before its

appearance before me. It then clearly indicated through Its

counsel that it dld not wish the application to be heard by a

single judge, but by a Full Court.

6.

I did it fact proceed to hear submissions on whether

leave should be granted. In the light of the conclusion I have

reached on the preliminary questlon, It is unnecessary to express

any vlews on the merlts of those submissions. Indeed, any such

views are quite irrelevant. The application for leave to appeal,

which on its face evldences no such election as to who should

determine the applicatlon, m the circumstances that have

occurred, should be heard by a Full Court of the Federal Court.