Palassis v Commissioner of Taxation (No 2)

[2012] FCA 955

FEDERAL COURT OF AUSTRALIA

Palassis v Commissioner of Taxation (No 2) [2012] FCA 955

Citation:

Palassis v Commissioner of Taxation (No 2) [2012] FCA 955

Appeal from:

The Taxpayers v Commissioner of Taxation [2011] AATA 33

Parties:

STAN MICHAEL PALASSIS v THE COMMISSIONER OF TAXATION

SCHEME MANAGERS PTY LTD v THE COMMISSIONER OF TAXATION

SCHEME MANAGERS PTY LTD v THE COMMISSIONER OF TAXATION

STAMFORDS ADVISORS AND CONSULTANTS PTY LTD v THE COMMISSIONER OF TAXATION

STAMFORDS ADVISORS AND CONSULTANTS PTY LTD v THE COMMISSIONER OF TAXATION

File numbers:

WAD 46 of 2011
WAD 47 of 2011
WAD 48 of 2011
WAD 49 of 2011
WAD 50 of 2011

Judge:

MCKERRACHER J

Date of judgment:

3 September 2012

Corrigendum:

5 September 2012

Catchwords:

APPEAL – whether Court should endorse consent minute amending the notice of appeal, allowing the appeal on a narrow procedural ground and remitting the proceeding to the Administrative Appeals Tribunal for reconsideration – whether the Administrative Appeals Tribunal constructively failed to exercise its jurisdiction by substantially reproducing the Commissioner's submissions without attribution

Cases cited:

Irwin v Military Rehabilitation and Compensation Commission (2009) 174 FCR 574
Kovalev v Minister for Immigration and Multicultural Affairs (1999) 100 FCR 323
LVR (WA) Pty Ltd v Administrative Appeals Tribunal and Commissioner of Taxation [2012] FCAFC 90

Date of hearing:

30 August 2012

Place:

Perth

Division:

GENERAL DIVISION

Category:

Catchwords

Number of paragraphs:

4

Counsel for the Applicants:

Ms T Hong

Solicitor for the Applicants:

Solomon Brothers

Counsel for the Respondent:

Mr P Walton

Solicitor for the Respondent:

Jackson McDonald

FEDERAL COURT OF AUSTRALIA

Palassis v Commissioner of Taxation (No 2) [2012] FCA 955

CORRIGENDUM

1.In para 4, the word ‘dismissal’ be replaced with ‘disposition’ so that the sentence reads, ‘The Commissioner has consented to the disposition of the appeals on the terms reflected in the orders’.

I certify that the preceding one (1) numbered paragraph is a true copy of the Corrigendum to the Reasons for Judgment herein of the Honourable Justice McKerracher.

Associate: 

Dated:       5 September 2012

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 46 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	STAN MICHAEL PALASSIS Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent
JUDGE:	MCKERRACHER J
DATE OF ORDER:	3 SEPTEMBER 2012
WHERE MADE:	PERTH

BY CONSENT, THE COURT ORDERS THAT:

1.The Further Re-amended Notice of Appeal is further amended as follows:

1.1a new paragraph 13 be inserted following paragraph 12 under the heading ‘Questions of Law’ as follows:

Did the Tribunal make an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision?

1.2a new sub-paragraph 1.3 be inserted below sub-paragraph 1.2 under the heading ‘Findings of Fact that the Court is Asked to Make’ as follows:

substantially reproduced the respondent’s written submissions verbatim and without attribution to the reasons for decision. 

1.3a new paragraph 14 be inserted below paragraph 13 under the heading ‘Grounds to be Relied On’ as follows:

Substantially reproducing the respondent’s written submissions verbatim without attribution in the reasons for decision, so as to constructively fail to exercise its jurisdiction.

2.The Administrative Appeals Tribunal (the ‘Tribunal’) having made an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision, and no other grounds of appeal having been the subject of determination by the Court, the appeal is allowed.

3.The whole of the case is remitted to the Tribunal to be heard and decided again in accordance with the following directions:

3.1all evidence is to be taken again; and

3.2the evidence that may be adduced by a party is not limited to evidence adduced by either party in the first instance proceedings before the Tribunal.

4.The respondent pay the applicant’s costs of and incidental to the appeal, including all reserved costs, to be taxed if not agreed. 

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

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 47 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	SCHEME MANAGERS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent
JUDGE:	MCKERRACHER J
DATE OF ORDER:	3 SEPTEMBER 2012
WHERE MADE:	PERTH

BY CONSENT, THE COURT ORDERS THAT:

1.The Further Re-amended Notice of Appeal is further amended as follows:

1.1a new paragraph 13 be inserted following paragraph 12 under the heading ‘Questions of Law’ as follows:

Did the Tribunal make an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision?

1.2a new sub-paragraph 1.3 be inserted below sub-paragraph 1.2 under the heading ‘Findings of Fact that the Court is Asked to Make’ as follows:

substantially reproduced the respondent’s written submissions verbatim and without attribution to the reasons for decision. 

1.3a new paragraph 14 be inserted below paragraph 13 under the heading ‘Grounds to be Relied On’ as follows:

Substantially reproducing the respondent’s written submissions verbatim without attribution in the reasons for decision, so as to constructively fail to exercise its jurisdiction.

2.The Administrative Appeals Tribunal (the ‘Tribunal’) having made an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision, and no other grounds of appeal having been the subject of determination by the Court, the appeal is allowed.

3.The whole of the case is remitted to the Tribunal to be heard and decided again in accordance with the following directions:

3.1all evidence is to be taken again; and

3.2the evidence that may be adduced by a party is not limited to evidence adduced by either party in the first instance proceedings before the Tribunal.

4.The respondent pay the applicant’s costs of and incidental to the appeal, including all reserved costs, to be taxed if not agreed. 

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

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 48 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	SCHEME MANAGERS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent
JUDGE:	MCKERRACHER J
DATE OF ORDER:	3 SEPTEMBER 2012
WHERE MADE:	PERTH

BY CONSENT, THE COURT ORDERS THAT:

1.The Further Re-amended Notice of Appeal is further amended as follows:

1.1a new paragraph 13 be inserted following paragraph 12 under the heading ‘Questions of Law’ as follows:

Did the Tribunal make an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision?

1.2a new sub-paragraph 1.3 be inserted below sub-paragraph 1.2 under the heading ‘Findings of Fact that the Court is Asked to Make’ as follows:

substantially reproduced the respondent’s written submissions verbatim and without attribution to the reasons for decision. 

1.3a new paragraph 14 be inserted below paragraph 13 under the heading ‘Grounds to be Relied On’ as follows:

Substantially reproducing the respondent’s written submissions verbatim without attribution in the reasons for decision, so as to constructively fail to exercise its jurisdiction.

2.The Administrative Appeals Tribunal (the ‘Tribunal’) having made an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision, and no other grounds of appeal having been the subject of determination by the Court, the appeal is allowed.

3.The whole of the case is remitted to the Tribunal to be heard and decided again in accordance with the following directions:

3.1all evidence is to be taken again; and

3.2the evidence that may be adduced by a party is not limited to evidence adduced by either party in the first instance proceedings before the Tribunal.

4.The respondent pay the applicant’s costs of and incidental to the appeal, including all reserved costs, to be taxed if not agreed. 

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

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 49 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	STAMFORDS ADVISORS AND CONSULTANTS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent
JUDGE:	MCKERRACHER J
DATE OF ORDER:	3 SEPTEMBER 2012
WHERE MADE:	PERTH

BY CONSENT, THE COURT ORDERS THAT:

1.The Further Re-amended Notice of Appeal is further amended as follows:

1.1a new paragraph 13 be inserted following paragraph 12 under the heading ‘Questions of Law’ as follows:

Did the Tribunal make an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision?

1.2a new sub-paragraph 1.3 be inserted below sub-paragraph 1.2 under the heading ‘Findings of Fact that the Court is Asked to Make’ as follows:

substantially reproduced the respondent’s written submissions verbatim and without attribution to the reasons for decision. 

1.3a new paragraph 14 be inserted below paragraph 13 under the heading ‘Grounds to be Relied On’ as follows:

Substantially reproducing the respondent’s written submissions verbatim without attribution in the reasons for decision, so as to constructively fail to exercise its jurisdiction.

2.The Administrative Appeals Tribunal (the ‘Tribunal’) having made an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision, and no other grounds of appeal having been the subject of determination by the Court, the appeal is allowed.

3.The whole of the case is remitted to the Tribunal to be heard and decided again in accordance with the following directions:

3.1all evidence is to be taken again; and

3.2the evidence that may be adduced by a party is not limited to evidence adduced by either party in the first instance proceedings before the Tribunal.

4.The respondent pay the applicant’s costs of and incidental to the appeal, including all reserved costs, to be taxed if not agreed. 

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

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 50 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	STAMFORDS ADVISORS AND CONSULTANTS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent
JUDGE:	MCKERRACHER J
DATE OF ORDER:	3 SEPTEMBER 2012
WHERE MADE:	PERTH

BY CONSENT, THE COURT ORDERS THAT:

1.The Further Re-amended Notice of Appeal is further amended as follows:

1.1a new paragraph 13 be inserted following paragraph 12 under the heading ‘Questions of Law’ as follows:

Did the Tribunal make an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision?

1.2a new sub-paragraph 1.3 be inserted below sub-paragraph 1.2 under the heading ‘Findings of Fact that the Court is Asked to Make’ as follows:

substantially reproduced the respondent’s written submissions verbatim and without attribution to the reasons for decision. 

1.3a new paragraph 14 be inserted below paragraph 13 under the heading ‘Grounds to be Relied On’ as follows:

Substantially reproducing the respondent’s written submissions verbatim without attribution in the reasons for decision, so as to constructively fail to exercise its jurisdiction.

2.The Administrative Appeals Tribunal (the ‘Tribunal’) having made an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the respondent’s written submissions verbatim and without attribution in the reasons for decision, and no other grounds of appeal having been the subject of determination by the Court, the appeal is allowed.

3.The whole of the case is remitted to the Tribunal to be heard and decided again in accordance with the following directions:

3.1all evidence is to be taken again; and

3.2the evidence that may be adduced by a party is not limited to evidence adduced by either party in the first instance proceedings before the Tribunal.

4.The respondent pay the applicant’s costs of and incidental to the appeal, including all reserved costs, to be taxed if not agreed. 

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

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 46 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	STAN MICHAEL PALASSIS
AND:	THE COMMISSIONER OF TAXATION Respondent

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 47 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	SCHEME MANAGERS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 48 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	SCHEME MANAGERS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 49 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	STAMFORDS ADVISORS AND CONSULTANTS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 50 of 2011

ON APPEAL FROM THE TAXATION APPEALS DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	STAMFORDS ADVISORS AND CONSULTANTS PTY LTD Applicant
AND:	THE COMMISSIONER OF TAXATION Respondent
JUDGE:	MCKERRACHER J
DATE OF ORDER:	3 SEPTEMBER 2012
WHERE MADE:	PERTH

REASONS FOR JUDGMENT

INTRODUCTION

1. These appeals were listed for hearing for three days in December.  The parties have produced a consent minute under which a further ground of appeal would be permitted following the reasoning of the Full Court in LVR (WA) Pty Ltd v Administrative Appeals Tribunal and Commissioner of Taxation [2012] FCAFC 90. It is well established that consent orders do not bind the Court. The Court must itself address and be satisfied as to the basis upon which the orders might be made: Kovalev v Minister for Immigration and Multicultural Affairs (1999) 100 FCR 323 (at [11]) and Irwin v Military Rehabilitation and Compensation Commission (2009) 174 FCR 574 (at [12]-[15]).

2. The circumstances of the present appeals are similar to those of LVR.  The parties have produced a document by which they are agreed as to the extent of reproduction of the Commissioner’s submissions in the reasons of the Administrative Appeals Tribunal (the Tribunal) under appeal.  It also shows by way of comparison, the extent of material not taken from that source.  It is unnecessary for present purposes to descend to detail.  However, it may be helpful to note some other matters. 

3. It may well be necessary in appropriate cases to record in detail the submissions of the parties, in some instances verbatim, making clear on any point of significance, who has advanced the submission.  (To fail to record and consider detailed submissions may also be criticised.)  It may also be that there are uncontentious summaries of the law that may be conveniently adopted from the parties’ submissions.  The shortcomings identified in LVR went beyond this and included treating unattributed, verbatim submissions of one party only as a considered reasoning process.  (There was also no reference to a material affidavit which was filed after the Commissioner’s submissions had been filed.)  The difficulty in simply adopting verbatim only one party’s submissions and without attribution is that even if those submissions are entirely correct, it may legitimately give rise to a concern that the Tribunal has failed to bring its own mind to bear on the issues before it and thus, that it has constructively failed to exercise its jurisdiction. 

   CONCLUSION

4. The Commissioner has consented to the dismissal of the appeals on the terms reflected in the orders.  Having examined in detail the agreed comparative document and considered the principles discussed in LVR, I am satisfied that this is an appropriate course.  Therefore orders are made in terms of the minute of consent orders provided to the Court on 30 August 2012 in each proceeding. 

I certify that the preceding four (4) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher.

Associate: 

Dated:       3 September 2012