Premier Pools Pty Limited & Ors v Commissioner of Taxation for the Commonwealth of Australia

[1992] HCATrans 292

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S99 of 1992

B e t w e e n -

PREMIER POOLS PTY LIMITED

First Plaintiff

THE PARTIES NAMED IN THE

SCHEDULE HERETO

Further Plaintiffs

and

COMMISSIONER OF TAXATION FOR

THE COMMONWEALTH OF AUSTRALIA

Defendant

Application to set aside writ

and/or directions

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McHUGH J

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON THURSDAY, 8 OCTOBER 1992, AT 10.19 AM

Copyright in the High Court of Australia

MR G.A. FLICK:  May it please Your Honour, I appear with

MR P.R. CLAY for Premier Pools. (instructed by

Roger Williams)

MR A.H. SLATER: If Your Honour please, I appear for the

respondent. (instructed by the Australian

Government Solicitor)

MR SLATER:  Your Honour, we have filed a summons which

seeks, among other things, an order that the writ

be struck out on the grounds it does not disclose a

cause of action. The justification for that is the
enactment by the Commonwealth Parliament of Act

No 113 of 1992, of which I think Your Honour has a

copy, the Swimming Pools Tax Refund Act,

section 4(1) of which provides that:

Except as provided by this section, the

Commonwealth is not liable to make any in situ

pool tax refund payment.

The exceptions referred to in the following subsections are not relied upon in the pleading

which is hardly surprising, Your Honour, because

the Act had not been passed at the time the

pleading was filed.

HIS HONOUR:	Yes.
MR SLATER:	Your Honour, the parties wish to test the issue

raised by the plaintiff as to the validity of the

Swimming Pools Tax Refund Act.

HIS HONOUR:  How is the validity being tested? It seeks no

declaration, does it, and you have put on no

defence yet.

MR SLATER:  No, Your Honour. We have moved to strike out

the statement of claim and the ground for moving to

strike it out is that this Act prohibits the

collection of any amount by the plaintiff on the

grounds set out in the statement of claim.

HIS HONOUR:  Have I got jurisdiction to state a case when

you have not put on a defence, have not put on an

appearance?

MR SLATER:	I was not able to find anything which made that clear, Your Honour, and that is why we moved to
strike out in accordance with the liberty given to
us under the leave to file a conditional
appearance, rather than moving by way of demurrer.
We do not at this stage wish to test the other issue arising under the summons as to misjoinder of
parties.  The parties simply wish to test the
constitutional issue and as I understand it,

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although there is not any pleading before

Your Honour which would disclose this, the

constitutional point is one taken under

placitum (ii) and placitum (xxxi), I hope, of
section 51. That is first, that the Act is not an

Act with respect to taxation - - -

HIS HONOUR:  And it is an acquisition of property otherwise than on just terms.

MR SLATER: Yes, Your Honour. That is, as I understand from

my friend, the two grounds upon which they rely.

HIS HONOUR:  There are already two cases before the Court

where it is alleged that by reason of

paragraph (xxxi) of section 51 of the Constitution

a limitation Act is void. One case concerns a

limitation Act which abrogated or abolished a

common law right of damages. We removed that last

week. Another case concerns a doctor's right of

payments under the Health Insurance Act. I am not

familiar with the details but my understanding is

that he alleges that the legislation amounts to an

acquisition of property.

But I am concerned about how to state a case

to the Full Court when you are seeking to strike

out the statement of claim and have not put on an

unconditional appearance.

MR SLATER:  I had thought, Your Honour, that Order 35

rule 2(1) would enable the Court to deal with that.

HIS HONOUR: This is certainly a proceeding.

MR SLATER:  Yes. And it is a question of law which is

raised.

HIS HONOUR:  Yes.

MR SLATER:  My friend has offered to accept that our

appearance remains conditional for the purpose of

arguing the second and third paragraphs of the

summons. My only hesitation about accepting that

offer is that I am not sure whether it is one that

he can make.

HIS HONOUR:	What do you say about this, Mr Flick?
MR FLICK:	What I put to Mr Slater is this, that it would be

our submission that the appropriate way to proceed

is for my friend to file a defence which relies

upon the amending Act and then we would put on a

reply saying that the amending Act is

unconstitutional. That course of proceeding would

identify all of the relevant facts which would be sufficiently concrete for Your Honour to refer to

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the Full Court, namely the nature of the business
of the plaintiff, the declaration by the High Court

in February, the making of payments by the

plaintiff to the Commonwealth, the fact that in

some cases we can make a concession, but not in

all, that those moneys which have been paid to the

Commonwealth were passed on to the customer, that phrase being "passed on" the one being picked up

from the Assessment Act, and in all cases that

those moneys have not been refunded, to use the

terms in 26. That would then use the two words in

the Assessment Act and in the Amendment Act, namely

"passed on" and "refunded", and that would be

sufficiently concrete for it to be referred to the

Full Court and the question would simply be whether

or not there has been an acquisition of a right,

namely the contractual right, which is constituted

we say be an exchange of correspondence - there may

be an argument about who are the parties to that -

or whether the other right which has been acquired

is a common law right. The real argument, we would

submit, may well be whether or not the acquisition,

even if it be an acquisition of property, whether

it is an acquisition on just terms in circumstances

where the moneys have not been refunded to the

customer.

That is the appropriate way, we would have

said, to proceed. My friend's concern, as I

understand him, is that he does not wish, by any

step, to be seen as abandoning the other points

that are raised by the summons, namely the

misjoinder of parties, as he sees it, and

section 26. What I have said to my friend, and

what Mr Slater quite correctly puts to Your Honour,

is that to the extent that we have it within our

control and power to do so, if my friend pursued
that course of putting on the defence and we put on

a reply, we would not construe that or put any

submission to the Court that that was an

unconditional appearance which, if the

constitutional point were resolved one way, would
preclude him from raising at a later point of time

the other arguments which he would seek to raise.

What Your Honour would refer to the Full Court

in those circumstances would be so much of the

proceeding as related to Premier Pools, but not the

other plaintiffs, which raise this transaction,

whether that constitutes the acquisition. In

answer to Your Honour, although a lengthy way, we

would say that is the appropriate way to proceed.

The other answer to Your Honour is that what

my friend says in terms of Order 35 rule 2, we
would have thought, would be sufficient power for

Your Honour to refer it to the Full Court and what

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Your Honour would do would be to refer paragraph 1

of his summons to the Full Court.	The normal
course is the former, rather than the latter.	We

really see this as springing from a matter which

may be a matter of justifiable concern, namely the

question of whether a step taken by a defendant
constitutes an unconditional appearance. It is our

primary submission that that sort of submission

should not be an obstacle to my friend putting on a

defence and a reply, and I will repeat that we will

not construe that as any unconditional appearance

which precludes him from raising the other points

at a later point of time.

HIS HONOUR:  The difficulty I see about the case at the

moment is that without affidavits from each side as

a minimum, setting out the respective cases, I do

not see how I can state a case on the strike out

application.

MR FLICK:  Certainly. The other way of doing it,

Your Honour, is for an agreed statement of facts to

be prepared which would raise - I should go back a

step. The case does raise two potential areas of

factual dispute and the two areas may be the

reasons why Your Honour would not be willing to

refer it to the Full Court at this stage. One is

who are the parties and what constitutes the

agreement, because Premier Pools is not expressly mentioned in that exchange of correspondence; and

the second area of factual dispute is to what

extent are moneys being passed on to the pool

owner.

The reason why both parties are in agreement

that it is appropriate for the Full Court to

consider the matter is that to some extent this

case will inevitably raise the constitutional

point. It will inevitably raise it because there

are cases in which it has been passed on and the

moneys have not been refunded and my friend will inevitably say, the amending Act is a defe·nce, and	we will s·ay it is unconstitutional for the reasons
he has given. The appropriate way may be to have
an agreed statement of facts and then Yo'ur Honour
could state a case as to whether, on those facts,
the amending Act is valid. And as I understand, my friend would not oppose that course either, subject of course to his concern that that would not be construed as an unconditional appearance.

HIS HONOUR:  Yes. At the present time I am certainly not

prepared to state a case. I want something before

me before I would do that - and this is addressed

to both parties. So either you would have to put

on an affidavit in support of your summons, setting

out the grounds on which you strike out, and giving

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your opponent the opportunity to put on an

affidavit in reply and that may give rise to

sufficient material to state a case. Or the

parties can agree on facts and put them before me

and then on that basis I can see whether or not a

case should be stated on those facts. But at the

moment it is too abstract, from my point of view.

MR FLICK: Given Your Honour's comments, we would prefer the

course of an agreed statement of facts which raises

a question and Your Honour can refer that question

to the Full Court. I do not know what my friend's

preference would be. Mr Slater indicates to me,

Your Honour, that he does not oppose that course.

HIS HONOUR:	The agreed stat 0 ment of fact?
MR SLATER:	Yes, Your Honour.
HIS HONOUR:	How long would you like to agree on this

agreed statement of facts?

MR FLICK: Without being disrespectful to Mr Bloom,

Your Honour, Mr Bloom will be leading me in this

case and Mr Bloom at present is in Perth. He may

wish to have some input as to the nature of the

facts so I would have thought that if the matter

could be stood over for two or three weeks, that

would allow sufficient time for the mechanics of an

initial draft to be prepared by our side, giv~n to

Mr Slater, and for it to come back to Your	,ur
in the form which is finally agreed.

HIS HONOUR:  I am not going to Perth so I will be here in

Sydney for the rest of the month. Apart from

that, I will not be in Sydney until the second half

of November.

MR FLICK:  If we could suggest a date convenient to

Your Honour towards the end of the month.

HIS HONOUR:  It is more a question of convenience of the

parties. Are the facts complex?

MR FLICK:	No, Your Honour.
HIS HONOUR:	Is there likely to be disagreement?
MR FLICK:	No, Your Honour, not to the extent to which we

wish to limit the dispute to raise the

constitutional point. There will be a factual

dispute if the constitutional point is resolved one

-	way, namely the extent to which moneys have been
passed on.

Premier	6	8/10/92
HIS HONOUR:	What do you say, Mr Slater?	Do you think the

prospects of agreeing on the relevant facts are

high?

MR SLATER: Yes, Your Honour. In the proceedings in the

Federal Court there has been agreement as to the

relevant facts in the Mutual Pools case and the

facts are unlikely to be materially different here.

HIS HONOUR:  What about the week commencing 26 October? Is

there any day that is unsuitable to counsel?

MR FLICK:	I am obviously in Your Honour's hands.
MR SLATER:	We are in Your Honour's hands too.
HIS HONOUR:	Perhaps we might stand it over until Thursday,

29 October.

MR SLATER: If Your Honour pleases.

HIS HONOUR:  And on that date I expect you will be back with

an agreed statement of facts which I can then

consider to determine whether I should state a

case.

I will stand this matter over for 21 days.

What about costs, reserve them?

MR FLICK: Reserve costs, Your Honour.

HIS HONOUR: Costs will be reserved. Is there anything

further, Mr Slater?

MR SLATER:  No, Your Honour.

HIS HONOUR: Mr Flick?

MR FLICK:	No, Your Honour.
HIS HONOUR:	We will adjourn.
AT 10.35 AM THE MATTER WAS ADJOURNED SINE DIE

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