Vance v Commissioner of Taxation

[2005] FCA 1326

FEDERAL COURT OF AUSTRALIA

Vance v Commissioner of Taxation [2005] FCA 1326

Federal Court of Australia Act 1976 (Cth) subs 43(2)
Income Tax Assessment Act 1936 (Cth) ss 74, 74A
Income Tax Assessment Act 1997 (Cth) s 8-1(1)(b)

Hughes v Western Australia Cricket Association (Inc) & Ors (1986) ATPR 40-748 referred to
Federal Commissioner of Taxation v Maddalena (1971) 71 ATC 4161 cited

DIANE MARGARET VANCE v COMMISSIONER OF TAXATION

No QUD 16 of 2005

SPENDER J
23 SEPTEMBER 2005
BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QUD 16 OF 2005

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN:	DIANE MARGARET VANCE APPLICANT
AND:	COMMISSIONER OF TAXATION RESPONDENT
JUDGE:	SPENDER J
DATE OF ORDER:	23 SEPTEMBER 2005
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.The appellant pay the costs of the respondent of and incidental to the appeal, to be taxed if not agreed.

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

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QUD 16 OF 2005

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN:	DIANE MARGARET VANCE APPELLANT
AND:	COMMISSIONER OF TAXATION RESPONDENT

JUDGE:	SPENDER J
DATE:	23 SEPTEMBER 2005
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. On 24 August 2005, I dismissed an appeal by the appellant from a decision of the Federal Magistrates Court.  I then indicated that I did not see any reason why the usual order as to costs should not be made, but deferred making any order as to costs until the appellant had the opportunity to make a submission concerning costs within seven days, with any response by the respondent to be filed within seven days thereafter.

2. Subsection 43(2) of the Federal Court of Australia Act 1976 (Cth) vests the award of costs ‘in the discretion of the Court or Judge’.  As Toohey J noted in Hughes v Western Australia Cricket Association (Inc) & Ors (1986) ATPR 40-748 at 48,136:

   ‘…1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order. Ritter v Godfrey (1920) 2 KB 47.’

3. The submissions filed on behalf of the appellant seek to revisit the substantive reasons for judgment in dismissing the appeal, asserting that the decision of the Federal Magistrate was in error, and that this Court ‘will review its judgement to correct the errors as outlined in the submissions below.’  The appellant persisted in her view that her entitlement to a deduction in respect of campaign expenses for her unsuccessful attempt to be elected mayor of a local government body had the support of the judgment of Menzies J in Federal Commissioner of Taxation v Maddalena (1971) 71 ATC 4161, contrary to my judgment.

4. The appellant also fails to appreciate the significance of ss 74 and 74A of the Income Tax Assessment Act 1936 (Cth) (“the 1936 Act”) in the disposition of her appeal. Section 74 of the 1936 Act provides that election expenses incurred in contesting an election for membership of the Parliament, of the Parliament of a State, or of the Legislative Assembly of the Australian Capital Territory or the Legislative Assembly of the Northern Territory of Australia, are an allowable deduction. Section 74A provides that election expenses for candidates contesting local government elections are similarly an allowable deduction, but the effect of s 74A(3) is to limit the deduction allowable to a taxpayer in contesting an election for membership of a local governing body to $1000. If the submissions by the appellant as to the reach of s 8-1(1)(b) of the Income Tax Assessment Act 1997 (Cth) are correct, both s 74 and s 74A of the 1936 Act would be otiose.

5. I have had regard to the submissions filed on behalf of the appellant and the response filed on behalf of the Commission of Taxation.  Nothing in the conduct of the original appeal, or in the further submissions, persuades me that I ought to make an order other than the usual order as to costs in relation to the disposition of this appeal.

6. The Court orders that the appellant pay the costs of the respondent of and incidental to the appeal, to be taxed if not agreed.

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

Associate:

Dated:            23 September 2005

Counsel for the Applicant:	The appellant appeared on her own behalf
Counsel for the Respondent:	Mr David Boddice SC, with Ms Kerri Mellifont
Solicitor for the Respondent:	Australian Government Solicitor
Dates of Submissions on Costs:	31 August 2005; 6 September 2005
Date of Judgment:	23 September 2005