Frucor Suntory New Zealand Limited v Commissioner of Inland Revenue

IN THE SUPREME COURT OF NEW ZEALAND

I TE KŌTI MANA NUI

SC 81/2020
[2020] NZSC 150

BETWEEN	FRUCOR SUNTORY NEW ZEALAND LIMITED Applicant
AND	COMMISSIONER OF INLAND REVENUE Respondent

SC 92/2020
BETWEEN	COMMISSIONER OF INLAND REVENUE Applicant
AND	FRUCOR SUNTORY NEW ZEALAND LIMITED Respondent

Court:	William Young, Glazebrook and O’Regan JJ
Counsel:	L McKay and M McKay for Applicant J B M Smith QC, E J Norris and L K Worthing for Respondent
Judgment:	18 December 2020

JUDGMENT OF THE COURT

A The application for leave to appeal (SC 81/2020) against the Court of Appeal’s decision is granted (Commissioner of Inland Revenue v Frucor Suntory New Zealand Limited [2020] NZCA 383).

BThe approved ground of appeal is whether the Court of Appeal was correct to allow the appeal.
CThe application for leave to appeal (SC 92/2020) against the Court of Appeal’s decision is granted (Commissioner of Inland Revenue v Frucor Suntory New Zealand Limited [2020] NZCA 383).
DThe approved ground of appeal is whether the Court of Appeal was correct to hold that shortfall penalties do not apply.

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Solicitors:
Bell Gully, Auckland for Applicant
Crown Law Office, Wellington for Respondent

CaseChat Overview and Summary

The Supreme Court of New Zealand heard two applications for leave to appeal from Frucor Suntory New Zealand Limited and the Commissioner of Inland Revenue. The disputes revolve around tax shortfall penalties imposed by the Commissioner on Frucor Suntory New Zealand Limited. The case was first decided by the Court of Appeal in 2020 and both parties sought leave to appeal to the Supreme Court.

The legal issues central to the appeal involved the interpretation and application of the Inland Revenue Act 2002. Specifically, the court had to determine whether the Court of Appeal was correct in allowing the appeal by Frucor Suntory New Zealand Limited and whether the shortfall penalties imposed by the Commissioner were justified. The focus was on the interpretation of statutory language concerning tax obligations and penalties.

The Supreme Court granted both applications for leave to appeal, indicating that there were significant legal questions that warranted further examination. The court identified that the approved ground of appeal was whether the Court of Appeal was correct in allowing the appeal and in holding that shortfall penalties do not apply. The decision to grant leave to appeal suggests that the Supreme Court found the issues raised to be of sufficient importance to merit a higher court review.

The final orders of the Supreme Court were to grant the applications for leave to appeal, setting the stage for a detailed examination of the issues in a subsequent hearing. This outcome ensures that the significant legal questions regarding tax shortfall penalties and their application will be thoroughly addressed in the higher court.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established