Resorts CM Pty Ltd v Deputy Commissioner of Taxation

[2009] FCA 1071

FEDERAL COURT OF AUSTRALIA

Resorts CM Pty Ltd v Deputy Commissioner of Taxation [2009] FCA 1071

Corporations Act 2001 (Cth)

RESORTS CM PTY LTD v DEPUTY COMMISSIONER OF TAXATION

QUD 225 of 2009

LOGAN J
18 SEPTEMBER 2009
BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION	QUD 225 of 2009

BETWEEN:	RESORTS CM PTY LTD Plaintiff
AND:	DEPUTY COMMISSIONER OF TAXATION Defendant

JUDGE:	LOGAN J
DATE OF ORDER:	18 SEPTEMBER 2009
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.The application is dismissed.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

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IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION	QUD 225 of 2009

BETWEEN:	RESORTS CM PTY LTD Plaintiff
AND:	DEPUTY COMMISSIONER OF TAXATION Defendant

JUDGE:	LOGAN J
DATE:	18 SEPTEMBER 2009
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. Resorts CM Pty Ltd has made application to set aside a statutory demand under the Corporations Act 2001 (Cth) issued at the behest of a Deputy Commissioner of Taxation (Commissioner). The statutory demand is grounded upon a range of debts arising under Australian revenue laws which are payable to the Commissioner. Upon the application being called on for me this morning the company sought to appear by its director, Mr Wayne Newman Sewell (Mr Sewell). There was no objection voiced on behalf of the Commissioner to an appearance by leave today on behalf of the company by Mr Sewell. It did seem to me that the interests of justice were best served by exceptionally permitting Mr Sewell as a director to appear on behalf of the company rather than to adjourn the matter so as to enable the company to appear by a solicitor.

2. The course taken by Mr Sewell has been one of particular frankness.  By that I mean he has stated, on behalf of the company, that the debts which are the subject of the statutory demand are not contested.  Rather, he has stated from the bar table that the amount of the debts at the time when the statutory demand was issued have been reduced.  I also note in the affidavit which he has sworn that he has proposed a particular payment arrangement to the Commissioner.  As it happens, that particular payment arrangement is not one which, at least as presently advised, the Commissioner is disposed to accept.  In other words, the Commissioner is not disposed at present to withdraw the statutory demand.

3. Evidence has been read which attests to the continuance of debts owed to the Commonwealth as well as verifying, by reference to the records maintained by the Commissioner within the Australian Taxation Office, the composition of the indebtedness to the Commonwealth which grounded the statutory demand. 

4. Given the particular admission on behalf of the company, it seems that there is no point in adjourning, as was requested by the company, the hearing of an application for the setting aside of the statutory demand.  Rather, it is an application which ought to be dealt with summarily.  In light of the admission made there is no prospect of the application for the setting aside of the statutory demand succeeding.  Mr Sewell did make reference to there being an ability where there was injustice in some wider form to set aside a statutory demand.

5. Even assuming that to be so, the rebuffing by the Commissioner of a proposed repayment arrangement and the making of some payments, after demand, to reduce the debt originally the subject of the statutory demand does not, at least in the present circumstances, ground any such injustice.  It is important to remember that the administration of the taxation laws is consigned by Parliament to the Commissioner of Taxation rather than to the courts.  In one sense, given the admission made, the application to set aside the statutory demand could truly be classified as an abuse of process as that term is technically used in the rules.  I do not, in adopting that term, do so in any pejorative way in relation to Mr Sewell. 

6. It seems to me, truly, that he has instituted the application out of a desire, perhaps, to excite the Commissioner’s attention to and interest in courses other than proceeding down a path that would lead to the windup of the company.  It is not, however, the function of the court to entertain applications on that basis.  In those circumstances, it seems to me that the only appropriate order to make is that the application be dismissed.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Logan.

Associate:
Dated:        22 September 2009

Solicitor for the Plaintiff:	Mr W Sewell, Director of Resorts CM Pty Ltd appeared in person by leave on behalf the Plaintiff
Solicitor for the Defendant:	Australian Taxation Office

Date of Hearing:	18 September 2009
Date of Judgment:	18 September 2009