Sung v The Chief Commissioner for Business Franchise Licences (Tobacco)

[1993] HCATrans 281

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No Sl00 of 1993

B e t w e e n -

JAMES SUNG

Applicant

and

THE CHIEF COMMISSIONER FOR

BUSINESS FRANCHISE LICENCES

(TOBACCO)

Respondent

Application for removal of

cause pursuant to section 40(1)

of the Judiciary Act 1903

BRENNAN J

DAWSON J

TOOHEY J

TRANSCRIPT OF PROCEEDINGS

AT SYDNE,Y ON FRIDAY, 17 SEPTEMBER 1993. AT 10.34 AM

Copyright in the High Court of Australia

Sung 1 17/9/93

MR B.R. PAPE:	May it please the Court, I appear for the applicant. (instructed by Marcel K. Doolan)
MR K. MASON, QC, Solicitor-General for New South Wales:	I

appear with my learned friend, MR G.C. LINDSAY, for

the respondent. (instructed by H .. K. Roberts, Crown

Solicitor for New South Wales)

BRENNAN J: What is your attitude, Mr Solicitor?

MR MASON:  We oppose the removal, Your Honour.

BRENNAN J: This is consequential, I take it, Mr Pape, upon

the consideration by this Court of the case of

Capital Duplicators?

MR PAPE: 

Yes, Your Honour.

BRENNAN J: 

Would the most convenient course not be to stand

the application over sine die, with leave to you to
restore it to the list, so that if the decision

comes out one way or the other, then the parties
can deal with it accordingly.

MR PAPE: That may be appropriate, yes, Your Honour, so long

as the proceedings in the supreme court are also

stayed, and I take it that if we did that, if

Your Honours were minded to do that, those

proceedings would also be stayed. Otherwise we

would be wasting costs.

BRENNAN J:  We will see what the Solicitor-General has to

say.

MR MASON: As to the first, yes, but as to the stay, no, and

that is not a matter directly before this Court.

The assessment has issued, the scheme of the

legislation is, in effect, that an assessment gives

rise to an enforceable debt. That enforcement
action has proceeded, proceeded to judgment.	The

time for an appeal from that judgment has expired.

The legislation provides a scheme whereby an appeal

can be brought from an assessment with the

provision for a consequential readjustment if that
appeal should succeed but, as in the Income Tax

Assessment Act, for example, it says that the grounds of those appeals are confined to the

grounds of objection that are taken prior to the

assessment.

The grounds of objection that were taken in

this case do no relate in any way to section 90 of

the Constitution. In effect, what happened was

that the grounds of objection were litigated in the

enforcement proceedings and -

Sung 2 17/9/93

DAWSON J: What is there to be removed?

MR MASON:  It is very difficult to see. There were two sets

of proceedings: one which proceeded to judgment in

which no appeal has been brought, which relates to,

in effect, a challenge to the validity of the

assessment; with a cross claim which resulted in a

judgment for the payment of the moneys assessed.

TOOHEY J: But the notice of motion speaks of a matter

pending before the supreme court.

MR MASON:  Yes, there were a second set of proceedings

brought, commenced not long before judgment was

given in the proceedings of which I have just

spoken. Those proceedings are brought under a

statutory scheme under Part 6 of the Act which

allow an appeal to be brought against an

assessment, as it. were, on the merits of the

assessment. The Act says that that appeal is

confined to the grounds taken by way of objection.

Those grounds do not relate to section 90. That

appeal has been brought. A judge has allowed that

appeal proceedings to have an amended ground,

namely the section 90 constitutional point.

Whether that paint can validly be taken is,

of course, an issue in those proceedings. We say

it cannot. In one sense this application is, in

our submission, either too early or too late or

both.

TOOHEY J:  Can the proceedings in the so-called pending

proceedings affect the judgment which has been

obtained against the applicant in the other

proceedings?

MR MASON:  Only in the sense that if they were successful,

notwithstanding Anshun or any of the other matters,

paid. The scheme of the legislation, as with for there is a statutory right to a refund of any duty	example the Income Tax Act, is that the making of
an appeal against an assessment does not suspend
the obligation to pay the tax assessed. That obligation, as I say in the present case, has
actually been translated into a judgment from which
no appeal has been brought.

DAWSON J: And you say in relation to the pending

proceedings there are some bridges to be crossed

before the section 90 point can be heard.

MR MASON:  A number of bridges. The constitutional point,

even assuming it is open, would not be one, in our submission, which ought to be determined this side

of judgment in Capital Duplicators in any event

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and, certainly, there ought not to be, in effect, a

stay of an unappealed supreme court judgment.

DAWSON J: There is an application to amend to raise the

section 90 - - -

MR MASON:  That app.Licatian has been granted but not r we

would argue, in a way that will pre-empt the Anshun

point or even an estoppel by judgment point that

has been taken. But we are prepared to accept

that that is or may be an issue in the currently

pending proceedings, but it does not provide any

stay on the judgment that has already been granted

or any reason for removal or for a stay.

BRENNAN J: Yes, Mr Pape.

MR PAPE:  Your Honours, may I hand up to Your Honours an

outline of what I propose to say.

BRENNAN J: Yes, it seems we were a bit too previous in

thinking we could solve this one easily.

MR PAPE:  I also have some statutory material and there is a

judgment of Mr Justice Finlay, the judge below, as

well. I invite Your Honours to read the outline.

TOOHEY J: This outline rather suggests, Mr Pape, that the

only object of a removal at this stage is to secure

a stay.

MR PAPE: Yes, Your Honour.

TOOHEY J: Otherwise there would be no point in the removal.

MR PAPE:  That is an alternative submission we would make,

that if Your Honours were minded not to remove the

proceedings into this Court that they would stay

the proceedings in the supreme court pending the

decision of Capital Duplicators.

BRENNAN J: Under what jurisdiction would that power be

exercised?

MR PAPE:  Bearing in mind there is a constitutional point,

rather than remove it into the list - - -

TOOHEY J: There is a judgment from which no application for

special leave to appeal to this Court has been

made.

MR PAPE: With respect, Your Honours, that judgment is part

of this regime of pay first, argue later, and it is

implicit in what Mr Justice Finlay said that there

were these Part 6 proceedings on foot. The

Commissioner can seek to recover the judgment but

it is subject to the Part 6 proceedings being on

Sung 17/9/93

foot. Now the applicant goes to the supreme court

and says~ there are no, in essence, Part 6

proceedings because there is no Act. The Act is

invalid. For the first time the applicant is now

taking the constitutional point. In my submission
there are two separate judgments. There is the

first judgment dealing with the recovery

proceedings which does not issue or deal with any

of the matters in terms of the excessiveness. All

it dealt with was whether there was in truth an

assessment.

BRENNAN J: If there is a judgment and there is no Act, how

do you propose to have that judgment set aside?

MR PAPE:  We would then seek that the prohibition and

certiorari would issue from the Court, the Act was

declared to be invalid, to quash that judgment.

BRENNAN J: From which Court?

MR PAPE: This Court, Your Honour.

DAWSON J:	To whom?
MR PAPE:	It would either be to the Supreme Court of New

South Wales to quash that judgment - - -

BRENNAN J: How does prohibition lie to the Supreme Court of

New South Wales?

MR PAPE:  In my submission it is a constitutional matter

which ought - now, it is not a 75(v) situation.

DAWSON J: I am not sure that I understand. If you

succeeded in your objection point, would you then

not have a right to recover the moneys from the

Commissioner?

MR PAPE: It may not arise, Your Honour. If we succeeded in

the objection point, or if the Act was declared

invalid, ipso facto there ought to be a refund of

the money or the judgment is expunged.

DAWSON J: But you have not paid.

MR PAPE: It cannot be expunged., it cannot be enforced. In

essence, what the recovery proceedings do is

establish conclusively a debit and what the appeal

proceedings - what I call the objection proceedings

do is to conclusively establish a credit. But they

are two separate proceedings. They are not

interrelated.

DAWSON J: Then if you failed in the objection proceedings,

you would then have an application for special

leave to appeal to this Court in relation to those.

Sung	17/9/93
MR PAPE:	It is certainly possible that we could seek an

application for special leave.

DAWSON J:  Why should we stop them or remove them at this

stage?

MR PAP&:  Because the first ground, we say, is that the

Supreme Court of New South Wales, in purporting to

exercise jurisdiction of an appeal under the Business Franchise Licences (Tobacco) Act is purporting to exercise a jurisdiction in which

there is no Act.

BRENNAN J: Is that the jurisdiction that you have invoked?

MR PAPE: Yes.

BRENNAN J:  How do you then hope for any relief if you have

invoked a jurisdiction which you seek to challenge.

MR PAPE:	We say there is no Act, Your Honour.
BRENNAN J:	I understand you to say that, but what

proceeding is there then to remove?

MR PAPE: At the present time, the Act is in force until

Your Honours say it is not in force.

BRENNAN Jt Yes. I think we understand the problem,

Mr Pape.

MR PAPE: That is the difficulty and, in our submission, the

matter came on before Mr Justice Finlay and no

constitutional point was taken, bearing in mind that Your Honours had refused, in Philip Morris

case, to allow argument to reopen Dennis Hotels and

that line of territory, and Mr Justice Finlay gave

judgment on 19 April of this year. On 20 April

Your Honours commenced to hear Capital Duplicators.

That is the chronology and Your Honours allowed

argument on the whole question of Dennis Hotels.

TOOHEY J: But the real point seems to be that you want

removal for the purpose of obtaining a stay in

respect of the judgment from which no application

for special leave to appeal has been brought in one

case, and in the other case where the proceedings

are still pending.

MR PAPE: Well, we could not

TOOHEY J: That is not by way of criticism; it is just a

fact of life.

MR PAPE:  No. The fact of life is that the constitutional

point, as we apprehend it, could not be raised in

the judgment proceedings because it was not raised

Sung 6 17/9/93

below. But it is now available and the Act
permits, in my submission, that that be allowed to

be brought because of the various natures - in

fact, the Act runs on two regimes. It runs on one

judgment for recovery and another judgment for the

appea].. It .is the concept 0£ tax whi.ch .is perhaps

peculiar to any other jurisdiction of paying first

and arguing later. There is, in this case, unless

one can have the assessment set aside because of

mala fides because there was no assessment, section

75 of the Act provides that it is conclusive

evidence against the taxpayer. So there can be no

argument in a recovery proceedings and the whole

jurisdiction question really arises in the appeal

proceedings.

Of course, my learned friend said there was no

ground of objection. That becomes an extraordinary

propo&ition to make - l.od.ge. an abjection ta the

Chief Commissioner for Business Franchise saying,

would you allow the objection on the basis that the

Act is invalid.	One knows the answer one would
get.	The Commissioner would say that it must be a
valid Act.	It is only until such time as one can

approach this Court that one can get a decision as

to whether that Act is invalid. And that is why we

make the submission that it is proper to raise, the

way it haa been in the summons, the jurisdiction

question. What we say is the Supreme Court of New

South Wales would be exceeding its jurisdiction to

hear this appeal because there is, in truth, no

Part 6.

Right through the judgment of

Mr Justice Finlay he adverted to the situation he was not deal.ing with the Part 6 proceedings and it

stemmed on that basis. Those are my submissions.

BRENNAN J:  We need not troubl.e you further, Mr Solicitor.

This is not a suitable case for removal.

There are issues which the parties wish to argue

that ought to be argued in the Supreme Court. The

purpose of the application is effectively ta secure

a stay o.f the judgment entered against the

applicant in the first proceeding. The

jurisdiction to make such an order is not

self-evident and, in any event, the question of a

stay is more appropriately to be considered by the

Supreme Court.

Accordingly the application is refused.

MR MASON:	I seek costs, Your Honours.
BRENNAN J:	Have you anything to say?

Sung 7 17/9/93

MR PAPE:	No, Your Honour.
BRENNAN J:	It will be refused with costs.

AT 10. 52 AM THE" !lmTTER WA:5' ADJOURNED srm: on

Sunq 8 17/9/93