Oil Basins Ltd v Commonwealth of Australia

[1994] FCA 83

Limited which raises in it the question of the liability of Oil Basins Limited to pay certain tax. Whether that is within the terms of the arbitration is a matter at issue between the parties and of itself will give rise to very complex legal questions as well as factual~matters. The arbitrators have indicated that they will not deal with that aspect of the matter until some time after Easter, after the beginning of April of this year.

The applicant is seeking an interlocutory order by motion notice of which is dated 19 November 1993 restraining the arbitrators from considering the aspect of the tax dispute pending the hearing and determination of the proceedings before this Court as to the liability of Oil Basins Limited to pay the tax. This is in circumstances where, at the present time, the Commissioner of Taxation has not issued any assessment against Oil Basins Limited. It is realised that Oil Basins Limited may suffer great detriment if

L in due course it is found to be liable to ta*. It must be noted that in the meantime the oil producers have in fact been paying that tax, and this could have a bearing on the matter.

discovery. The only point for discovery in relation to the

.,

As far as the motion for the interlocutory injunction is concerned, the Court cannot prevent the applicant from proceeding with that. It is not suggested that the Court should so prevent the applicant from proceeding with that motion. The only argument is in relation to the time factor for the production of affidavits and the hearing of the motion, which is said could take two to three days. The real issue between the parties is whether there should be other

directions on the question of pleadings between the parties and for

Commonwealth of Australia and the Commissioner for Taxation relates to the other action between them in the Administrative Appeals Tribunal and that gives rise to other problems which I will not refer to at the moment.

In my opinion, the important factor is the question of the injunction. If the injunction is granted in due course, that would prevent the arbitrators from considering the matter in the absence of the Commonwealth or the Commissioner for Taxation, neither of which would be bound by any of the decisions of the arbitrators. In the meantime, in relation to the objection to liability to taxation taken by the oil producers which has been rejected by the Commissioner, the oil producers can seek a review of that before the

AAT or by an appeal to the Federal Court. There is in existence an

indication from the Full Court of the High Court of Australia that the Commissioner should notify Oil Basins Limited of any such move taken by the oil producers to enable Oil Basins Limited to apply for revocation of the special leave to appeal from the judgment of M r Justice Dawson. The need for that is that Oil Basins Limited would

not of necessity be a party to either of those proceedings, although it possibly could be affected by the outcome of those matters.

As was said, this is a matter which, in due course, will need to be determined in such a way as to ensure uniformity between all decisions. This can only be done in the case where all parties are bound by a judgme~t one way or the other of a court or a decision of a tribunal. Having regard to the fact that the question of jurisdiction, although existing at the moment, is in issue and is subject to a decision by the High Court, unless the leave to appeal is revoked, it seems to me that it is unnecessary to make directions as to the future conduct of the action in relation to pleadings, even though there is an order of Mr Justice Dawson which has been ignored by the oil producers that defences be filed, and that this Court should not at this stage make such orders as outlined in the form of the directions sought by Oil Basins Limited before me today.

For the same reasons, discovery should not be given. The absence of pleadings, in my opinion, will not affect adversely the motion for interlocutory injunction, the affidavits will sufficiently identify the issues for the purposes of that matter. On the same basis, discovery against the Commissioner should not be granted and I do not need to go into the further arguments made by M r Shaw QC on behalf of the Commissioner and the Commonwealth. In all the circumstances then, the Court makes the following directions concerning the motion by the applicant, notice of which is dated 19 November 1993:

1.    Any affidavits upon which the applicant wishes to rely be filed

and served on or before 15 February 1994; -

2.   Any affidavits upon which the third, fourth and fifth respondents wish to rely be filed and served on or before 7 March 1994;

3.   Any affidavits in reply to be filed and served on or before 14 March 1994;

4 .    The motion be listed far hearing as a matter of priority at the first available date after 14 March 1994, it being noted that the hearing is estimated to be two to three days.

I will adjourn the directions hearing to 25 March 1994, and I will order that the costs of today be costs in the cause. I should also indicate that there is nothing to stop any party from bringing the matter before the Court at any time by notice of motion, but what is sought to be attempted is to allow the applicant to have its motion heard at a time before the arbitrators enter into the arbitration in relation to the taxation issue. If the hearing cannot be heard before that date, this may well be a case where interlocutory orders may have to be made to maintain the status quo pending the hearing of the motion for interlocutory relief.

I certify that this and the preceding four (4) pages are a true copy of the Reasons for Judgment of The Honourable M r Justice R.M. Northrop.

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Date: 23 W 4