Re Skyring, A.G. Ex parte Skyring, A.G. v Deputy Commissioner of Taxation

[1992] FCA 121

! IN THE FEDERAL COURT OF AUSTRALIA YUDGl\.dENT NO. 171 \ I

GENERAL DIVISION	l
BANKRUPTCY DISTRICT OF THE STATE OF OUEENSLAND

No. QB 351 of 1989	;
' I I

RE :  ALAN G. SKYRING

EX PARTE: ALAN G. SKYRING

Applicant

AND :  DEPUTY COMMISSIONER OF TAXATION

Respondent

FEDERAL COURT OF

AUSTRALIA PRINCIPAL

JUDGE MAKING ORDER:	Drummond J
DATE OF ORDER:	5 March, 1992
WHERE MADE:	Brisbane
THE COURT ORDERS THAT:
NOTE :	Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

1.        The application filed 2 December, 1991 is dismissed.

2.        The Applicant pay the costs of the Respondent's application filed 7 February, 1992, to be taxed.

IN THE FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
BANKRUPTCY DISTRICT OF

THE STATE OF OUEENSLAND

No. QB 351 of 1989

RE:  ALAN G. SKYRLNG

EX PARTE: ALAN G. SKYRING

Applicant

AND :  DEPUTY COMMISSIONER OF TAXATION

Respondent

Coram:	Drummond J
Date:	5 March, 1992

Place: Brisbane

EX TEMPORE REASONS FOR JUDGMENT

This is an application by Mr. Skyring, firstly, for
an order annulling his bankruptcy and, secondly, for an order

for compensation both monetary and non-monetary, for

malfeasance and/or misfeasance on the part of Crown	authorities, including the Deputy Commissioner of Taxation, in
respect of what is alleged to have been their wrongful prosecution of bankruptcy proceedings against him which led to the sequestration order being made.
So far as the application for annulment is concerned, Mr. Skyring brought a similar application before Pincus J on 22 November, 1990. The grounds for Mr. Skyring's current application, as is apparent from the supporting material filed by him are exactly the same grounds as those on which he sought to persuade Pincus J to annul his bankruptcy.

Those grounds are as follows:

1.    The judgment upon which the bankruptcy notice issued by the Commissioner of Taxation was founded was a summary judgment and not a final judgment and, therefore, not capable of supporting a notice and, in turn, a sequestration order in the event of its non- compliance. This ground was only raised before me as a subsidiary point.

2. The Income Tax Assessment Act 1936 [Cthl on which the judgment debt was based is invalid; and

3. The Reserve Bank Act 1959 fCthl which authorises paper money as legal tender is invalid. It is this third basis which is

really at the core of Mr. Skyring's argument.

All three issues outlined above were determined against Mr. Skyring by Pincus J. After unsuccessfully attempting to move the matter into the High Court, Mr. Skyring filed an appeal from the judgment of Pincus J. Judgment dismissing the appeal was given by the Full Court of the Federal Court on 22 November, 1991.

The Full Court considered each of the three points I have already referred to and made determinations against Mr. Skyring on all three.

Ffnalitv of iudament

As to the first issue raised by Mr. Skyring, the Full Court at page 4 of the judgment said:

"The point is that until set aside the summary judgment was final and conclusive and it never has been set aside: Re Hanbv: Ex ~arte Fleminaton C entral S~ares Ptv. Ltd. (1967) 10 F.L.R. 378 at 380-381; Clvne v Deputy Commissioner of Taxation [No. 4 1 (1982) 66 F.L.R. 301 at 309-312.

Validity of the Income Tax Assessment Act 1936 (CthL

This argument was also rejected by the Full Court. Beginning at the end of page 7, the Full Court said:

"As to the appellant's contention directed to the validity of the income tax legislation, it is sufficient to refer to what was said by the Full Court of the High Court on 9 July 1985 in dismissing an appeal against a decision of Deane J in

Skvrina's A~~lication (No. 2 1 (1985) 59 A.L.J.R.

561. The Full Court said: "The power conferred upon the Commonwealth Parliament by S. 51(ii) of the Constitution to legislate with respect to taxation extends to the imposition of taxation and its collection, even though it has the effect of requiring the person on whom taxation is levied to pay the tax out of property which he owns.""

Validitv of Reserve Bank Act 1959

The third and most critical point was determined

adversely to Mr. Skyring at pages 6 and 7 of the Full Court

judgment .

At page 7 the Full Court reached the following

conclusion:

"The Parliament has legislated for the issue of paper money as legal tender and there is no constitutional bar against it having done so."

The position is clear. Mr. Skyring seeks to litigate precisely the same issues which he has already litigated unsuccessfully before both a single judge and the Full Court of the Federal Court. Even if Mr. Skyring is not estopped from seeking to re-litigate these issues now, it is pointless attempting to do so before me, because I am bound by the doctrine of precedent to comply with the decision of the

Full Court and reject the application.

Even though Mr. Skyring may wish, as I believe he does, to put additional arguments in support of his annulment application, the position is that I am bound, notwithstanding any additional argument he may wish to advance, to apply the Full Court judgment and dismiss the application so far as it

seeks annulment.

5   1

In his application, Mr. Skyring also seeks compensation for misconduct on the part of Crown authorities, in respect of wrongfully maintaining the bankruptcy proceedings against him which led to the sequestration order.

The difficulty for Mr. Skyring in seeking to maintain such an action is that the sequestration order remains in existence. In The Metropolitan Bank Limited & Anor. V Poolev (1885) 10 App. Cas. 210, the same situation arose for consideration. A bankrupt (after bankruptcy) brought an action against the bank alleging that it had wrongfully caused a creditor to maintain bankruptcy proceedings against him which led to his ultimate bankruptcy.

At the time the proceedings came before the court, the sequestration order remained on foot. That was held to be a fatal bar to the maintenance of the action. The Court drew an analogy with the rule that a claim in a malicious prosecution case can only be maintained after the criminal proceedings said to be malicious have been determined, and then only if

wishes to sue for damages for malicious prosecution. they have been determined favourably to the plaintiff who So long as the sequestration order stands, that order is a complete and fatal bar to Mr. Skyring's claim for compensation. This is apparent from the reasons of the Lord Chancellor in Poolevrs case at pages 216-217.

I am therefore in the position where it seems to me quite plain that the claim for compensation is doomed to failure. The application insofar as it claims compensation is also dismissed.

I certify that this and the five
preceding pages are a true copy
of the reasons for judgment
herein of the Honourable

Mr. Justice Drummond.

Associate:	- " " e ^ H ~ w
Date :	5 March, 1992