Springside Holdings Pty Ltd and Tax Practitioners Board

Springside Holdings Pty Ltd and Tax Practitioners Board [2023] AATA 3367 (18 August 2023)
Division:TAXATION AND COMMERCIAL DIVISION
File Number(s): 2023/3233
Re:Springside Holdings Pty Ltd
APPLICANT

AndTax Practitioners Board
RESPONDENT

DECISION
Tribunal:Senior Member Grigg
Date:18 August 2023
Date of written reasons: 16 October 2023
Place:Sydney

For the reasons given below and given orally at the end of the interlocutory hearing of this
matter, pursuant to ss 42A(2) and (4) of the Administrative Appeals Tribunal Act 1975 (Cth),
the Tribunal dismisses:
1the application for review; and
2the application for confidentiality and non-publication orders filed by Mr Richard Hill on 18 May 2023.

................................SGD........................................
Senior Member Grigg
Catchwords
Tax agent registration – standing – non-publication – application for dismissal – failure to appear – trust – trustee - liquidator
Legislation
Administrative Appeals Tribunal Act 1975 (Cth)
Tax Agent Services Act 2009 (Cth)
Cases
Christopher Paul Williams and Australian Electoral Commission and the Greens (Party Joined) [1995] AATA 160
REASONS FOR DECISION
Senior Member Grigg
13 October 2023
Introduction

The Applicant, through Mr Richard Langley Stewart Hill, filed the following applications:
(a)On 8 May 2023, an application for review of a decision of the Tax Practitioners Board (the Board), made 30 March 2023 and sent to the Applicant in correspondence dated 20 April 2023;
(b)On 18 May 2023, an application for orders prohibiting or restricting the publication of any information relating to the proceedings (Non-Publication Application).
Mr Hill also lodged written submissions in support of his Non-Publication Application.
On 18 July 2023, the Respondent lodged an application that the application for review be dismissed pursuant to the following sections of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) (Dismissal Application):
(a)Section 42A(4) of the AAT Act;
(b)In the alternative, s 42A(5)(a) of the AAT Act;
(c)In the alternative, s 42B of the AAT Act; or
(d)In the alternative, s 27(1) of the AAT Act.
In the Dismissal Application the Respondent also sought (as a further alternative) the dismissal of the Non-Publication Application filed by Mr Hill.
The determination of the Non-Publication Application and the Dismissal Application was scheduled to be heard at an interlocutory hearing on 18 August 2023.
On 28 July 2023 the parties were notified by an email sent by the Tribunal indicating the scheduled date and time of the interlocutory hearing.
Neither the applicant nor any purported representative appeared at the interlocutory hearing in this matter which occurred on 18 August 2023. Mr Hill who is noted on file as the contact person for the applicant did not appear.
The Respondent appeared and was represented by Mr Arnold, of Counsel.
At the conclusion of the hearing I gave an oral decision and made the following orders:
For the reasons given orally at the conclusion of the interlocutory hearing of this matter, pursuant to ss 42A(2) and (4) of the Administrative Appeals Tribunal Act 1975 (Cth), the Tribunal dismisses:
1the application for review; and
2the application for confidentiality and non-publication orders filed by Mr Richard Hill on 18 May 2023.
Subsequent to the hearing I was informed by Registry staff that on 17 August 2023 the Applicant had sent an email to the Tribunal, not copied to the Respondent, requesting the hearing be adjourned for seven days.
This email was not brought to my attention until after I had made the orders dismissing the Applicant’s applications at the interlocutory hearing.
Upon becoming aware of the Applicant’s adjournment request the Applicant was advised of the orders that had been made and informed that he would be provided with a written statement of reasons.
Mr Hill’s request for the adjournment indicates that Mr Hill had been made aware of the listing date.
Applications for Confidentiality and Non-Publication Orders
On 28 July 2023 the Applicant was notified by an email sent by the Tribunal to Mr Hill indicating the scheduled date and time of the interlocutory hearing. During the hearing it became apparent that it was unclear whether this email was received by the Applicant because the Tribunal received an automatic reply on 28 July 2023 indicating the Applicant was no longer using the email address of Mr Hill on the Tribunal’s file. That automatic reply email also indicated a new email address for the Applicant.
No formal request for a change in the Applicant’s contact details was ever made to the Tribunal.
On 15 August 2023 the Respondent’s representatives sent an email to the Applicant (i.e. Mr Hill) that made direct reference to the interlocutory hearing scheduled for 18 August 2023. The Respondent’s email also included as an attachment a copy of the Tribunal’s listing notice for the interlocutory hearing. This correspondence was forwarded to the Applicant’s updated new email address. In addition, on 15 August 2023 the Tribunal also sent correspondence to the Applicant’s new email address referring to the upcoming interlocutory hearing.
Mr Arnold informed the Tribunal that Mr Hill responded to the 15 August 2023 correspondence stating that both email addresses were working and functioning. Mr Hill did not indicate that he would not be appearing.
On the morning of 18 August 2023, the Tribunal sent an email to the Applicant’s new email address which included an updated MS Teams link for the interlocutory hearing and a note that the event was scheduled for that day at 10:00am. The Tribunal also attempted to contact Mr Hill by the contact telephone number he had provided the Tribunal.
The Respondent also made enquiries of the liquidator of the Applicant as to whether they would be appearing and they indicated they would not be appearing.
It can be inferred from the above communication attempts that Mr Hill was aware that the matter had been listed for hearing on 18 August 2023.
I am satisfied the Applicant was aware of the interlocutory hearing and failed to appear at the event and has not provided any reasons for his lack of appearance.
In the circumstances I decided not to consider the Non-Disclosure Applications made by Mr Hill.
The Tribunal’s power to dismiss an application is permitted under s 42A(2) of the AAT Act. On the basis of the applicant’s failure to appear the Tribunal’s power to dismiss the applications lodged for confidentiality and non-publication orders is also permitted under s 42A(2) of the AAT Act.
Even if I had not found grounds to dismiss the applications, I would have found there was no merit in Mr Hill’s applications for the following reasons.
The Non-Publication Application was applied for on the grounds that publication of the decision to deregister the tax agent registration of Springside Holdings Pty Ltd (Springside Holdings) would:
(a)be misleading and confusing and cause the Applicant’s liquidator unnecessary time and expense in dealing with the liquidation;
(b)cause personal financial detriment to Mr Hill; and
(c)damage Mr Hill’s reputation.
The Respondent submitted that, in relation to personal financial detriment, it was not clear, how that financial detriment is linked to the publication of the deregistration decision with respect to Springside Holdings, which is now in liquidation. Further, even if it had been established that publication of the decision under review would result in Mr Hill suffering personal financial detriment, the case authorities provide that personal financial detriment alone is insufficient to override the standing principle with respect to open justice in the tribunal.
Insufficient details or particulars were provided to support the assertion that Mr Hill’s reputation would be damaged. There was no evidence before me to demonstrate what the purported impact is exactly.
There was no information at all about the purported financial impact. Reputational damage and/or financial or economic damages may not be an uncommon impact on anybody in these circumstances, but in order to rise above the usual course and to show there is a reason for the granting of such orders in this instance, I would need to have information.
In relation to the Non-Publication Application, there was confusion as to which party made the application. One document indicated the application was made on behalf of a trustee. Another document, the Springside Holdings application, states:
“The submission of Richard Hill on behalf of the applicant”.
As discussed below, Mr Hill has no standing to continue with the proceedings on behalf of Springside Holdings because it is in liquidation. A liquidator was appointed to Springside Holdings nine days after the application was filed. There is no consent from the liquidator for the Applicant permitting Mr Hill to proceed and no application on foot made by the purported new trustee.
Even if there was a basis for Mr Hill to continue, for the same reasons as outlined in relation to the Non-Publication Application, the Tribunal would not have been minded to make the order as a result of the lack of any detail or evidence.
Respondent’s Application for Dismissal of the Application for Review
The Respondent seeks the following orders:
(a)The application for review lodged on 8 May 2023 (Application for Review) be dismissed pursuant to s 42A(4) of the AAT Act.
(b)In the alternative, the Application for Review be dismissed pursuant to s42A(5)(a) of the AAT Act.
(c)In the alternative, the Application for Review be dismissed pursuant to s 42B of the AAT Act.
(d)In the alternative, the Application for Review be dismissed pursuant to s 27(1) of the AAT Act.
The issue is who is the proper applicant.
The respondent submits that the proper applicant for the matter is Springside Holdings, through its liquidator.
Springside Holdings was, prior to its deregistration, registered as a tax agent as trustee of a unit trust.
Mr Hill has submitted in written submissions filed in this tribunal on 15 June 2023 that:
(e)RHA Associates Pty Ltd had replaced Springside Holdings Pty Ltd as the trustee of the trust; and
(f)he can continue with the proceedings in the name of the new trustee, despite a liquidator having been appointed in relation to Springside Holdings Pty Ltd.
Pursuant to section 20-1 of the Tax Agent Services Act 2009 (Cth) (TASA), tax agents must be registered to provide tax agent services.
Eligibility for registration as a registered tax or BAS agent is governed by section 20-5. It provides:
Individuals
(1) An individual, aged 18 years or more, is eligible for registration as a *registered tax agent or BAS agent if the Board is satisfied that:
(a) the individual is a fit and proper person; and
(b) the individual meets the requirements prescribed by the regulations (including, but not limited to, requirements relating to qualifications and experience) in respect of registration as a registered tax agent or BAS agent; and
(c) in the case of registration which is not a renewal—the individual maintains, or will be able to maintain, professional indemnity insurance that meets the Board’s requirements; and
(d) in the case of a renewal of registration—the individual:
(i) maintains, at the time of applying for registration, professional indemnity insurance that meets the Board’s requirements; and
(ii) has completed continuing professional education that meets the Board’s requirements.
Note 1:       An individual in the capacity of trustee of a trust can be registered: see section 70 15.
Note 2:      Subsection (4) provides for an exception to paragraph (1)(b) for pre 1988 tax agents and nominees.
Partnerships
(2) A partnership is eligible for registration as a *registered tax agent or BAS agent if the Board is satisfied that:
(a) each partner who is an individual is:
(i) aged 18 years or more; and
(ii) a fit and proper person; and
(b) if a company is a partner:
(i) each director of the company is a fit and proper person; and
(ii) the company is not under external administration; and
(iii) the company has not been convicted of a *serious taxation offence or an offence involving fraud or dishonesty during the previous 5 years; and
(c) the partnership has:
(i) in the case of registration as a *registered tax agent—a sufficient number of individuals, being registered tax agents, to provide *tax agent services to a competent standard, and to carry out supervisory arrangements; or
(ii) in the case of registration as a *registered BAS agent—a sufficient number of individuals, being registered tax agents or BAS agents, to provide *BAS services to a competent standard, and to carry out supervisory arrangements; and
(d) in the case of registration which is not a renewal—the partnership maintains, or will be able to maintain, professional indemnity insurance that meets the Board’s requirements; and
(e) in the case of a renewal of registration—the partnership maintains, at the time of applying for registration, professional indemnity insurance that meets the Board’s requirements.
Companies
(3) A company is eligible for registration as a *registered tax agent or BAS agent if the Board is satisfied that:
(a) each director of the company is a fit and proper person; and
(b) the company is not under external administration; and
(c) the company has not been convicted of a *serious taxation offence or an offence involving fraud or dishonesty during the previous 5 years; and
(d) the company has:
(i) in the case of registration as a *registered tax agent—a sufficient number of individuals, being registered tax agents, to provide *tax agent services to a competent standard and to carry out supervisory arrangements; or
(ii) in the case of registration as a *registered BAS agent—a sufficient number of individuals, being registered tax agents or BAS agents, to provide *BAS services to a competent standard, and to carry out supervisory arrangements; and
(e) in the case of registration which is not a renewal—the company maintains, or will be able to maintain, professional indemnity insurance that meets the Board’s requirements; and
(f) in the case of a renewal of registration—the company maintains, at the time of applying for registration, professional indemnity insurance that meets the Board’s requirements.
Note:         A company in the capacity of trustee of a trust can be registered: see section 70 15.
Special rule about pre 1988 tax agents
(4) An individual is eligible for registration as a *registered tax agent even if the Board is not satisfied that the individual satisfies the requirements mentioned in paragraph (1)(b) if:
(a) the individual was registered as a tax agent or as a nominee for the purposes of Part VIIA of the Income Tax Assessment Act 1936 (as in force immediately before the commencement of item 7 of Schedule 1 to the Tax Agent Services (Transitional Provisions and Consequential Amendments) Act 2009) at both of the following times:
(i) immediately before the commencement of this Act;
(ii) immediately before the commencement of section 39 of the Taxation Laws Amendment Act (No. 2) 1988; and
(b) the individual is otherwise eligible for registration as a registered tax agent.
As noted above, subsection 20-5(3) of the Act provides that companies may be registered entities.
The note to that subsection confirms that:
“The company in the capacity of trustee of a trust can be registered. See section 70-15”.
Section 70-15 of TASA allows the registration of a company in its capacity as trustee:
How this Act applies to an individual or company in the capacity of a trustee
This Act applies to:
(a) a trustee who is an individual in the same way as it applies to an individual; and
(b) a trustee that is a company in the same way as it applies to a company.
The Respondent submits that there is no ability under the TASA for a trust to be registered.
The Respondent’s contention is that the effect of s 70-15 excludes any registration of a trust as a registered tax or BAS agent. Contrary to the position of Mr Hill who has made the claim a trust itself can be registered under TASA, there is simply no legislative mechanism which permits a trust to be registered. The Respondent also referred to the Tax Practitioners Board information sheet titled 03/2011, which although not a legal instrument, is consistent with that understanding.
I am satisfied that this understanding of the TASA is correct. In addition the only evidence filed that indicates there is a new corporate trustee for Springside Holdings is an email filed by the Applicant to that effect.
Assuming Springside Holdings, as corporate trustee, has been replaced, the Respondent indicates that purported new entity has made no application with the Tax Practitioners Board for registration as a registered tax or BAS agent.
Even if one could argue that a new trustee might have standing or could otherwise bring some sort of application, there is no evidence before me other than an email from Mr Hill to indicate that the corporate trustee of the trust has in fact changed
There is insufficient evidence to confirm whether a new trustee of the unit trust was appointed. All that is available is an assertion by Mr Hill that this was done. This is insufficient to satisfy the Tribunal. No trust deed has been provided. In those circumstances, particularly where Mr Hill has failed to appear, the tribunal cannot be satisfied there is a new corporate trustee of the unit trust.
Even if the Tribunal was satisfied that the corporate trustee had changed, the next issue is whether the corporate trustee ever made an application to become registered as a registered tax agent. The answer is it has not.
One of the main purposes which falls within the objectives and the purposes of having a registered tax agent system is to ensure the general public can feel a degree of comfort that persons, or entities – and the persons within those entities – who wish to provide tax agent services are fit and proper, amongst other things. Part of the registration application process is for the Board to assess those applications.
If there has been no application, the Board cannot assess whether that person or entity is appropriate.
Further, the trustee that is proposed by Mr Hill would be incapable of registration, because Mr Hill is the sole director and his personal registered tax registration was cancelled in 2020. One of the factors that the Board would have had to have taken into account even if the purported new trustee made an application was whether or not it was fit and proper on the basis that Mr Hill, who was a deregistered tax agent, was its director.
There is no basis under TASA for a trust on its own to become a registered tax agent. And, in any event, no application has been made by the trust for such a registration.
Mr Hill’s contention that the registration was attached to the trust is not correct.
As a result, neither the trust, Mr Hill, nor RHA Associates Pty Ltd has any standing to commence or continue with this proceeding.
A further consideration is whether Mr Hill, the trust, or RHA Associates, are entities whose interests may be affected by the decision. No such application has been made to the Tribunal to that effect. However I considered this issue for completeness given the absence of Mr Hill.
Pursuant to section 27 of the AAT Act:
Persons who may apply to Tribunal
(1) Where this Act or any other enactment (other than the Australian Security Intelligence Organisation Act 1979) provides that an application may be made to the Tribunal for a review of a decision, the application may be made by or on behalf of any person or persons (including the Commonwealth or an authority of the Commonwealth or Norfolk Island or an authority of Norfolk Island) whose interests are affected by the decision.
Note: The enactment may be regulations made for the purposes of subsection 25(2) (review of decisions made in the exercise of powers conferred by a Norfolk Island enactment).
(2) An organization or association of persons, whether incorporated or not, shall be taken to have interests that are affected by a decision if the decision relates to a matter included in the objects or purposes of the organization or association.
(3) Subsection (2) does not apply in relation to a decision given before the organization or association was formed or before the objects or purposes of the organization or association included the matter concerned.

The application that was filed in the Tribunal indicates that the Applicant is the trustee of the trust. As discussed above, there is uncertainty around whether the trustee has changed. However, no replacement trustee has applied to be registered as a tax agent. It cannot therefore be said that their interests may be affected. The liquidator for the registered tax agent has indicated a lack of interest in pursuing the matter. And the trust can only operate via the trustee within the TASA regime
In a 1995 AAT decision of Christopher Paul Williams and Australian Electoral Commission and the Greens (Party Joined) [1995] AATA 160 the Tribunal was constituted by three judges, one who was the President of the tribunal and the other two judges, Hill and Beaumont, were judicial Deputy Presidents. The Tribunal was initially required to look directly at the issue about who has standing. In the end the Tribunal considered whether the proceedings were vexatious. They determined that the outcome of the proceedings – whether they were successful to whichever applicant was intended to bring the application - would be devoid of any practical effect. There is a similarity to the situation before this Tribunal where the only decision that can be made is to affirm, vary or to set aside the decision of the Board to deregister Springside Holdings as the registered tax agent. And the decision to proceed is solely within the rights of the liquidator. Therefore, any final decision would be devoid of any practical effect.
The Tribunal was not sufficiently satisfied that Mr Hill or the “new trustee” have interests that will be adversely affected. No submissions were made by the Mr Hill, RHA Associates Pty Ltd or the applicant on this issue.
In the circumstances outlined above the tribunal dismisses under section 42A(4), on the ground that the decision is not reviewable.
The Tribunal would also have power to dismiss the matter under 42A(2) on the basis that the applicant has failed to appear, or failed to appear by representative, at this interlocutory hearing despite being put on notice.
On 20 April 2023 the Respondent decided to terminate Springside Holdings tax agent registration. On 8 May 2023 the application for review was filed and on 17 May 2023 Springside Holdings was placed into liquidation. On 25 May 2023 the liquidator was informed that an application for review had been made and an AAT proceeding had been initiated. The Tax Practitioner’s Board has made a number of attempts and has in fact succeeded in those attempts to communicate with the liquidator regarding querying what steps they were going to take and putting them on notice as well that in the event that they didn’t confirm that they were continuing with the proceedings, that the Tax Practitioner’s Board would be filing the application to dismiss the matter.
I was informed by the Respondent that there had been recent communications where the liquidator again confirmed that they would not be appearing at this interlocutory hearing and no material or other communications have been filed by the liquidator with the tribunal. In those circumstances the tribunal would have also dismissed the application pursuant to 42A(5) for a failure to proceed.
Given that the liquidator is not the actual applicant, I’m not going to make that order. I simply note for the record that they have failed to appear. The matter was not brought by them and was not filed by them as liquidator. Therefore they’re not even strictly speaking an applicant at this stage. I also note that the liquidator did not provide Mr Hill with consent to continue with the application. Nor has the Tribunal been made aware that the liquidator has provided consent to any other person to take over as an appropriate applicant.
Further, the tribunal notes that pursuant to section 42A(5), the tribunal may dismiss an application without proceedings to review in circumstances where an applicant has failed within a reasonable time to proceed with the application or to comply with a direction. The tribunal finds that the liquidator has been on notice of the application filed by Mr Hill in the name of the trustee for the DFK Richard Hill Unit Trust, concerning Springside Holdings Pty Ltd, since 25 May 2023.
Conclusion
Mr Hill has also failed to appear and no reasons have been provided for that failure to appear, and therefore the tribunal also has power to dismiss the primary proceeding, but also the confidentiality order and non-publication order applications lodged by Mr Hill.
For the reasons outlined above, pursuant to ss 42A(2) and (4) of the Administrative Appeals Tribunal Act 1975 (Cth), the Tribunal dismisses:
1the application for review; and
2the application for confidentiality and non-publication orders filed by Mr Richard Hill on 18 May 2023.

I certify that the preceding 67 (sixty-seven) paragraphs are a true copy of the reasons for the decision herein of Senior Member Grigg.

..................................SGD......................................
Associate
Dated: 16 October 2023

Date(s) of hearing: 18 August 2023

Applicant: No Appearance

Counsel for the Respondent:
Thomas Arnold

Solicitors for the Respondent: Scott Burchill; Julie Mills

[2023] AATA 3367

18 August 2023

Key Legal Topics

Areas of Law

Administrative Law

Tax Law

Legal Concepts

Standing

Procedural Fairness

Judicial Review

Date(s) of hearing:	18 August 2023
Applicant:	No Appearance
Counsel for the Respondent:	Thomas Arnold
Solicitors for the Respondent:	Scott Burchill; Julie Mills