Ilich v Commissioner of Inland Revenue

[2010] NZCA 397

IN THE COURT OF APPEAL OF NEW ZEALAND

CA33/2009
[2010] NZCA 397

BETWEENANDREW ILICH
Applicant

ANDTHE COMMISSIONER OF INLAND REVENUE
Respondent

Hearing:17 August 2010

Court:Glazebrook, Venning and Simon France JJ

Counsel:Applicant in person
T M Molloy for Respondent

Judgment:25 August 2010 at 4.30 pm 

JUDGMENT OF THE COURT

A        The application is declined.

BCosts for a standard application on a band A basis plus usual disbursements are awarded to the Commissioner.

____________________________________________________________________

REASONS OF THE COURT

(Given by Glazebrook J)

Introduction

[1]       Mr Ilich applies for leave to extend time for appealing against a judgment of Associate Judge Doogue of 5 August 2008, which declined to set aside a bankruptcy notice issued by the Commissioner of Inland Revenue (the Commissioner) against him.[1] 

[1]      Ilich v Commissioner of Inland Revenue (2008) 23 NZTC 22, 042 (HC).

[2]       The bankruptcy notice was based upon a judgment that the Commissioner obtained against Mr Ilich in the Auckland District Court in which Judge Hole found Mr Ilich liable to pay the sum of $350,252.41 (for unpaid GST, income tax and PAYE).[2]  Judge Hole’s decision was based in part on an adjustment agreed between the Commissioner and Mr Ilich. 

[2]      Commissioner of Inland Revenue v Ilich DC Auckland CIV-2001-004-1111, 5 April 2005.

[3]       Before Judge Hole, Mr Ilich had advanced a number of defences, including that he had agreed to the adjustment under duress and, in a somewhat contradictory submission, that he was under the mistaken impression that the agreed adjustment settled all tax arrears.  Judge Hole rejected all of Mr Ilich’s defences.

Associate Judge Doogue’s decision

[4]       Associate Judge Doogue, in declining to set aside the bankruptcy notice, held that there was no arguable defence to the Commissioner’s underlying claim that had not been addressed by Judge Hole.  Further there had been no procedural defects that would justify the Court in setting aside the bankruptcy notice. 

[5]       The Associate Judge was cognisant that there was an application to extend time for appealing against Judge Hole’s decision but considered that this application (and the resulting appeal if an extension of time was granted) could be dealt with before any bankruptcy proceedings based on the bankruptcy notice were dealt with.[3] 

Procedural history

[3]In the event the bankruptcy proceedings have been stayed until both this leave application to this Court and the leave application in respect of Judge Hole’s decision have been determined.

[6]       Mr Ilich’s application to extend time to appeal against Associate Judge Doogue’s decision first came before this Court on 7 April 2009.  By minute of 9 April 2009 the matter was adjourned until the application to extend time for appealing against Judge Hole’s decision could be heard in the High Court. 

[7]       That application was heard by Stevens J in the Auckland High Court on 18 June 2009.[4]  Stevens J dismissed the application because Mr Ilich had failed to offer an adequate explanation for the delay of 38 months in seeking to bring an appeal.  Stevens J also observed that the intended appeal did not appear to have merit.

[4]      Ilich v Commissioner of Inland Revenue (2009) 24 NZTC 23,556 (HC).

[8]       On 22 July 2009 Mr Ilich filed an application for leave to appeal against Stevens J’s decision in the Auckland High Court.  This application was dismissed by Stevens J on 1 March 2010[5] on the basis that there was a direct right of appeal to this Court and there was no requirement to seek the leave of the High Court before bringing such an appeal.[6] 

[5]      Ilich v Commissioner of Inland Revenue (2010) 24 NZTC 24,093 (HC).

[6]We are not to be taken as making any comment on whether Stevens J was right in stating that Mr Ilich has a direct right of appeal to this Court.

[9]       Mr Ilich told us at the hearing that he is applying for leave to appeal to the Supreme Court against Stevens J’s judgment.[7]  Mr Ilich also indicated that he had lodged an appeal at the Taxation Review Authority and that there was a teleconference at the end of this month in relation to that appeal.  We note, however, that there had been an earlier application to the Taxation Review Authority which sought to challenge the assessments.  This was dismissed on the grounds the Authority had no jurisdiction to make the orders sought.[8]

Mr Ilich’s submissions

[7]We are not to be taken as making any comment on whether that procedure is appropriate.

[8]      Ilich v Commissioner of Inland Revenue Decision No 020/2004, 14 May 2004.

[10]     In his application, Mr Ilich asserts that he gave notice to this Court’s Registry of his intention to appeal against Associate Judge Doogue’s decision on 20 August 2008 and that he was told that he would be sent advice on the correct process to follow in respect of the appeal.  In his oral submissions before us, he also essentially repeated the arguments that he had presented to Judge Hole.

Commissioner’s submissions

[11]     The Commissioner opposes the application to extend time to appeal on two bases:  that Mr Ilich has not adequately explained the delay and that the intended appeal is without merit.

Discussion

[12]     We accept the Commissioner’s submission that there has not been an adequate explanation of the delay in seeking to challenge Associate Judge Doogue’s decision.  As pointed out by the Commissioner, Mr Ilich received an email from this Court’s Registry on 20 August 2008 which advised him to purchase a copy of the Court of Appeal (Civil) Rules 2005.  He was told that the Rules would contain instructions on how to go about filing an appeal.  Mr Ilich did not file any documents until 20 January 2009 and has provided no explanation for this delay.

[13]     We also accept the Commissioner’s submission that the appeal is without merit.  Whether or not Judge Hole’s decision was correct is not before us.  We are concerned with Associate Judge Doogue’s decision. As noted in the Minute of this Court of 9 April 2009, the proposed appeal from the decision of Associate Judge Doogue can have no merit if Judge Hole’s decision remains in place as it is final and dispositive of the issues. 

[14]     As the situation stands at present, Judge Hole’s decision has not been set aside and the matter has already gone on far too long.  Further, we can see no defect in Associate Judge Doogue’s judgment.  Mr Ilich’s application must be declined.

Result and costs

[15]     The application is declined.

[16]     Mr Ilich must pay costs for a standard application on a band A basis plus usual disbursements to the Commissioner.

Solicitors:
Crown Law Office, Wellington for Respondent