Zaps Transport (Aust) Pty Ltd, Domenic Zappia & John Zappia (Taxation)

The case involved Zaps Transport (Aust) Pty Ltd, Domenic Zappia, and John Zappia, who were subject to statutory demands for the recovery of unpaid customs duty. The dispute arose after dutiable tobacco and tobacco products were stolen from a warehouse. The applicants' warehouse licence had been varied to exclude petroleum and like products, and crucially, permission to move dutiable tobacco and tobacco products from the warehouse had not yet been granted. The court was required to determine whether the company, Domenic Zappia, and/or John Zappia were entrusted with the possession, custody, or control of the stolen dutiable goods, and whether it was appropriate to pierce the corporate veil.

Deputy President Bernard J McCabe P found that Domenic Zappia exercised control over the goods, even though his control was subordinate to his father and the company. The evidence indicated that Domenic directed the day-to-day handling of the goods, possessed delegated authority to accept and release them, and that employees followed his orders. His operational role was further evidenced by his meeting with Australian Taxation Office officers to discuss the incident. The court was satisfied that the statutory demands for the recovery of unpaid duty were properly made.

The decision affirmed the original determination to issue each of the statutory demands. The court concluded that the individuals and the company were indeed entrusted with the possession, custody, or control of the dutiable goods, leading to their liability for the unpaid duty.