Mawhinney v Commissioner of Inland Revenue
[2014] NZHC 1554
•4 July 2014
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV 2012-404-003985 [2014] NZHC 1554
IN THE MATTER of the Goods and Services Tax Act 1985,
The Administration Act 1994, and the
High Court Rules 2008BETWEEN
PETER WILLIAM MAWHINNEY as trustee of the Forest Trust
Plaintiff
AND
COMMISSIONER OF INLAND REVENUE
Defendant
Hearing: 1 July 2014 Appearances:
P W Mawhinney in person the Plaintiff/Respondent
D Lemmon and C L Russell for the Defendant/ApplicantJudgment:
4 July 2014
JUDGMENT OF ASSOCIATE JUDGE CHRISTIANSEN
This judgment was delivered by me on
04.07.14 at 4:30pm, pursuant to
Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Date……………
P W MAWHINNEY v COMMISSIONER OF INLAND REVENUE [2014] NZHC 1554 [4 July 2014]
Litigation background
[1] On a date in 2009 the Forest Trust (the Trust) purchased a property on Anzac
Valley Road, Waitakere, for $600,000.
[2] For the period ended 31 July 2009 and in relation to that purchase the Trust filed a GST return claiming a refund of $67,011.65.
[3] The Trust was informed by the Commissioner by letter dated 13 October
2009 that its GST return was to be audited. The Commissioner’s letter noted:
...adjustments have been made in accordance with s 89C(eb) Tax Administration Act 1994 (“TAA”) on the basis that it is believed the trust has been involved in fraudulent activity. A Notice of Assessment and/or Statement of Account will be issued shortly.
[4] The Commissioner issued a Notice of Assessment on 20 June 2012. It stated the amount owed to the Trust was nil and that the refund was disallowed in accordance with s 89C(eb) of the TAA.
[5] The Trust says it issued a Notice of Proposed Adjustment (NOPA) in August
2012, and that the Commissioner’s notice of response to this, dated 1 November
2012, was out of time.
[6] Mr Mawhinney then filed in the High Court, an application for review under the Judicature Amendment Act 1972 against the decisions made by the Commissioner.
[7] The Commissioner responded by objecting to the jurisdiction of the Court to hear and determine the application claiming that the causes of action pleaded against the Commissioner in the judicial review raised matters that should properly be raised through the statutory disputes and challenge procedures contained in Parts 4A and
8A of the TAA.
[8] The review application was heard by Cooper J. The learned Judge’s judgment issued on 23 December 2013. In that His Honour concluded that the Commissioner’s protest to jurisdiction was well founded and therefore it was not
necessary for him to consider the alternative application of strikeout. The learned Judge noted that Part 4A of the TAA set out procedures under which the Commissioner may issue NOPA’s in respect of tax returns or assessments and that tax payers may issue a NOPA in response; that time limits applied.
[9] His Honour noted Part 8A of the TAA provided a procedure by which tax payers may challenge an assessment before a “hearing authority”, defined as either the TRA or the High Court.
[10] In that case it was noted that part of Mr Mawhinney’s argument rested on
ss 89C(eb) and 138E. Regarding that His Honour noted:
[23] ... Section 89C provides that the Commissioner must issue a notice of proposed adjustment before the Commissioner makes an assessment unless the circumstances set out in subss (a) – (m) apply. One of the circumstances, subs (eb), is that “the Commissioner has reasonable grounds to believe that the tax payer has been involved in fraudulent activity”.
[24] Section 138E sets out cases in which “a right of challenge is not conferred”. These cases include, in subs (1)(e)(iv), a matter which is left to the discretion, judgment, opinion, approval, consent, or determination of the Commissioner by a provision in, amongst other things, s 89C.
[11] Before Cooper J Mr Mawhinney argued that the Commissioner unlawfully purported to rely on s 89C(eb) of the TAA to assess GST for the period ended 30
July 2009 to nil. He contended that the issues in respect of s 89C(eb) are expressly excluded from challenge under Part 8A and therefore it was an appropriate matter for consideration upon judicial review.
[12] Cooper J did not accept that argument. He noted that:
[36] ... It is clear that the Commissioner considered there were reasonable grounds to believe the applicant had been involved in fraudulent activity. That meant that s 89C(eb) was available as a basis upon which a notice of proposed adjustment could be issued... The issue of the proper assessment of the GST for the period ended 31 July 2009 is plainly now a matter which is the subject of a dispute able to be resolved in the statutory disputes and challenge procedures under the Act.
[13] In conclusion Cooper J stated:
[46] It follows that s 109 applies and that means that the pleaded causes of action against the Commissioner cannot be advanced in this Court on an application for review.
[14] His Honour then referred to the decision of the Supreme Court in Tannadyce1. As noted by Cooper J, in that case the majority recognised that the Commissioner’s statutory power to make assessments was within the reach of judicial review. It also recognised that:
[56] …judges should be slow to conclude that a statutory provision ousting or limiting access to the Courts was intended to preclude applications to the High Court for judicial review alleging unlawfulness of any kind.
[15] And then:
[57] But in the present case there is no need to strain to reconcile the terms of s 109 with a general availability of judicial review in the interests of preserving tax payer’s access to the High Court when tax payers need it. This is because the challenge procedure has a built-in right for the tax payer to take the matter to the High Court, if that is thought necessary or desirable. There cannot therefore be any question of s 109 preventing access by tax payers to the High Court. Giving effect to its terms does not have that consequence. It cannot matter whether the tax payer seeks relief from the High Court pursuant to an application for judicial review or pursuant to a challenge under Part 8A. As we have seen, the statutory procedures are framed so as to give hearing authorities the power to consider a challenge made to an assessment on any ground whatsoever and to cancel, vary or confirm the assessment as may be appropriate.
[16] Cooper J recorded that it was Mr Mawhinney’s argument that the Commissioner unlawfully purported to rely on s 89(C)(eb) of the TAA to assess GST for the period ended 30 July 2009 to nil; that Mr Mawhinney contended that issues in respect of that provision are expressly excluded from challenge under Part 8(A) by s
138E(1)(e) and that the Commissioner’s stance on that issue was inconsistent with the position previously adopted by her. Cooper J records Mr Mawhinney’s submission that none of those matters could be dealt with through the statutory disputes and challenge procedures. The learned Judge responded:
[36] I do not accept Mr Mawhinney’s argument. It is clear that the Commissioner considered that there were reasonable grounds to believe the applicant had been involved in fraudulent activity and that s 89C(eb) was available as a basis upon which a notice of proposed adjustment could be
1 Tannadyce Investments Limited v Commissioner of Inland Revenue [2011] NZSC 158.
issued. Mr Mawhinney seeks to challenge whether there were such reasonable grounds. However, whether or not they existed, issue of a proper assessment of the GST for the period ended 31 July 2009 is plainly now a matter which is the subject of a dispute able to be resolved in the statutory disputes and challenge procedures under the Act. On 3 September 2012 the trustees served a notice of proposed adjustment on the Commissioner disputing the assessment of the GST period ended 31 July 2009. In addition, on 4 September 2012 the Commissioner was served with a notice of claim dated “August 2012” which the trustees of the Trust had sought to file in the TRA challenging the assessment of the GST period ended 31 July 2009.
[17] And later:
[37] …The appropriate amount of the GST is clearly a matter that can be resolved in accordance with the statutory procedures. Then, noting that the Commissioner had now issued a notice of proposed adjustment, including the period ended 30 September 2010, that Mr Mawhinney was able to have the issues considered and determined in the statutory disputes and challenge process.
[18] The learned Judge concluded:
[45] In the case of each cause of action the relief sought includes orders quashing the decision made by the Commissioner in relation to the GST for the period ended 31 July 2009, and an order that the Commissioner refund the amount of $67,011.65. Whilst Mr Mawhinney argues different bases on which the trust is said to be entitled to this relief, the end point in each case involves consideration of the correct GST position in relation to that period that is an issue plainly within the statutory disputes and challenge procedures in the Act.
[19] On 12 February 2014 Mr Mawhinney filed an appeal of that decision to the Court of Appeal; however, the notice of appeal was rejected due to multiple deficiencies. Mr Mawhinney has filed an application for an extension of time to file the appeal and that application is opposed by the Commissioner. Recently that appeal was stalled by issues arising in connection with Mr Mawhinney’s application for waiver of filing fees.
This proceeding
[20] Mr Mawhinney’s first statement of claim numbered 88 pages and was filed on 12 July 2012. Mr Mawhinney sought damages and or compensation of
$5,113,810.72.
[21] At that time Mr Mawhinney also filed a summary judgment application seeking $594,210.48 for GST refunds withheld by the Commissioner.
[22] In December 2013 Mr Mawhinney filed an amended statement of claim which is 156 pages long and included an additional cause of action alleging statutory entitlement and it also purported to include an application for judicial review.
[23] In February 2014 Mr Mawhinney filed and served his second amended statement of claim which is 188 pages long and includes the additional cause of action that purports to be a challenge under Part 8A of the TAA.
The Commissioner’s strike out and security for costs applications
[24] The Commissioner has applied to strike out parts of Mr Mawhinney’s second
amended statement of claim. Also, further security for costs has been applied for.
Strike out
[25] The principles are well known. These were summarised by the Court of Appeal in Attorney-General v Prince and Gardner2 and endorsed by the Supreme Court in Couch v Attorney-General3. They are, inter alia:
(a) Pleaded facts, whether or not admitted, are assumed to be true. This does not extend to pleaded allegations which are entirely speculative and without foundation.
(b) The cause of action or defence must be clearly untenable.
(c) The jurisdiction is to be exercised sparingly, and only in clear cases.
(d)The jurisdiction is not excluded by the need to decide difficult questions of law, requiring extensive arguments.
2 Attorney General v Prince and Gardiner [1988] 1 NZLR 262 (CA) at 267.
3 Couch v Attorney General [2008] NZSC 45, [2008] 3 NZLR 725 at [33].
(e) The Court should be particularly slow to strike out a claim in any developing area of the law, perhaps particularly where a duty of care is alleged in a new situation.
[26] The strike out application concerns the new fourth cause of action added by the second amended statement of claim filed by Mr Mawhinney on 3 March 2014.
[27] The fourth cause of action that the Commissioner seeks to strike out is
Mr Mawhinney’s challenge to the Commissioner’s:
(a) Reassessment of the GST amount to nil in the period ended 31 July
2009.
(b)Decision that s 89C(eb) of the TAA, provided grounds, function and power for the Commissioner to reassess the amount of GST in the period ended 31 July 2009 to nil.
(c) Decision whereby it was accepted that output GST was payable on the sale of a property being Lot 323 in the period ended 30 September
2011, but refused the input GST refund on the property purchase in the GST period ended 31 July 2009.
(d) Non issue of a challenge notice pursuant to s 89(P) TAA for the GST
period ended 31 July 2009.
[28] In respect of the strike out and security for costs application there will be reference to previous statements of claim filed in this proceeding and to previous applications made in respect of the proceeding generally.
Considerations
[29] Mr Mawhinney’s position is that if he has supplied information in support of GST refund claims then his assessment must be accepted if the Commissioner takes no action within 15 working days after receipt of that information. It is the Commissioner’s position that an entitlement to a refund does not occur because of
any perceived failure by the Commissioner to deliver within time a notice that an investigation was to occur.
[30] The Commissioner says:
(a) she lawfully retained refunds for seven GST periods because she gave valid notices to withhold payments under s 46 including for the period ended 31 October relating to the claimed refund amount;
(b) that she has offset refunds due for other tax periods; and
(c) for the GST period ended 31 July 2009 the Commissioner validly amended the assessment amount of $67,011.65 to nil under s 89C(eb) TAA.
[31] The Commissioner considers that s 46 does not allow a tax payer to claim payment of excess tax if the Commissioner takes no action for more than 15 working days after receiving requested information.
[32] It was by the statutory and challenge procedures in the TAA that Mr Mawhinney’s dispute was being processed when he filed his application for the review that Cooper J heard.
[33] The procedures comprise two parts. There is that which is contained in Part 4A of the TAA under the heading Disputes Procedures and there is that contained in Part 8A under the heading Challenges.
[34] Regarding those two parts the Court of Appeal in Allen v Commissioner of
Inland Revenue4 commented:
[9] Unlike the disputes procedure, which is in the nature of a negotiation process, the challenge procedure envisages litigation before a hearing authority, which may be either the TRA or the High Court. The litigation is initiated by the filing of proceedings in accordance with the Taxation Review Authority Regulations 1994… or in accordance with the High Court Rules, within a response period following the issue of the relevant notice of a
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disputable decision (see ss 138B and 138C). The terms of those sections make it plain that there cannot be recourse to litigation unless the dispute procedure under Part 4A has been followed to the extent as set out in the applicable sub section.
[35] It is Mr Mawhinney’s contention that the Part 4A process had concluded. Indeed he submits in that outcome and due to the Commissioner’s failure to comply with time constraints, a GST refund is deemed to be payable by the Commissioner to Forest Trust.
[36] That would explain his filing an application for review to the High Court. It would explain also his purpose by his filing of the second amended statement of claim and adding to that the new fourth cause of action.
[37] However Mr Mawhinney is wrong when he says the Part 4 process had concluded. He assumes that the lack of a challenge notice issued by the Commissioner means, by implication, that the position of the tax payer is accepted. To the contrary, s 89P makes it clear that the Commissioner does not have to issue a challenge notice to the extent to which any dispute is at an end. Further, the Commissioner has up to four years to issue such a challenge notice and in this case that period has not expired.
[38] That means the matter is still the subject of the TAA Part 4A processes. Cooper J in the review hearing upon Mr Mawhinney’s application considered that the question of whether there were reasonable grounds for the Commissioner to issue a NOPA, and the issue of whether there was a proper assessment of GST “is plainly now a matter which is the subject of a dispute able to be resolved according to the statutory disputes and challenge procedures under the Act”.
[39] It appears clear the part 4A process is still underway, subject to the Court of Appeal’s consideration of Mr Mawhinney’s appeal of Cooper J’s judgment. Of course it is only with respect to the Part 8A aspect of the process that the matter may come before the High Court or before the TRA.
[40] When Mr Mawhinney filed his first statement of claim in this proceeding on
12 July 2012 he also applied for summary judgment. In his judgment dated 4 April
2013 upon that application Associate Judge Bell considered Mr Mawhinney’s claim that the Commissioner’s own documents identified Forest Trust’s entitlement to a refund of $604,786.72 and further that under s 46 of the Goods and Services Tax Act
1985 the Forest Trust is entitled to refunds because the Commissioner did not initiate an investigation within 15 working days of receiving information requested of the Trust, as she was required to do under s 46(4).
[41] In his conclusion Associate Judge Bell stated:
[51] … I am not persuaded that s 46 can be read to impose a duty on the Commissioner to make a refund… Accordingly, the Commissioner has an arguable defence to Mr Mawhinney’s second argument.
[42] It is clear that the appeal of the decision of Cooper J is extant despite Mr Mawhinney’s view it is not going anywhere presently. It appears a fee waiver has been granted.
Conclusions
[43] Despite Mr Mawhinney’s belief to the contrary his issues, being those same ones raised by the new fourth cause of action in his second amended statement of claim in this proceeding, are presently awaiting consideration by the Court of Appeal which will likely, among other matters, address the decision of Cooper J that Mr Mawhinney’s issues should be returned to be dealt with by the statutory disputes and challenge procedures of the TAA.
[44] However, and if it should still be Mr Mawhinney’s position that he retains access to the challenge aspect (as opposed to the Part 4A dispute aspect) of that process to be determined by the High Court then he faces a near insurmountable obstacle by virtue of what the Supreme Court said in the Tannadyce5 case:
[61] In summary therefore we would hold that disputable decisions (which include assessments) may not be challenged by way of judicial review unless the tax payer cannot practically invoke the relevant statutory procedure. Cases of that kind are likely to be extremely rare.
5 (Supra).
[45] Mr Mawhinney’s case does not by any measure qualify itself as being of the
rare kind.
[46] The matters raised by the new fourth cause of action are already subject to consideration by the TAA dispute processes and in that regard are before the Court of Appeal. Therefore the new pleading is a duplication of process. It should be struck out.
Application for security for costs
[47] The Commissioner seeks $40,000 and for the proceeding to be stayed until that sum is paid or security is given.
[48] Rule 5.45 provides an order for security may be given if there is reason to believe a plaintiff is unable to pay costs if unsuccessful in the proceeding.
[49] In this case the Commissioner contends the cost of defending the litigation is unjustified, particularly where it is over complicated and unnecessarily protracted as is here.
[50] In this case it is not challenged that the Trust has inadequate resources to meet any costs. As much was acknowledged in the application for a fee waiver upon the application to the Court of Appeal for a review of Cooper J’s judgment.
[51] The Commissioner contended and it is not disputed that in the last income tax return for the Trust filed for the year ended 31 March 2011, the Trust disclosed liabilities of about $6.4M, total assets of about $4.5M and with a net loss for that year of about $73,000.
[52] Also it appears the Trust does not have its own bank accounts but that Mr
Mawhinney has used accounts in his own name to conduct the Trust’s affairs.
[53] Forest Trustee Limited, a related entity, contends it holds property as bare trustee for the Trust, in which there is a net equity of more than $3M. But, Forest Trustee Limited is not a trustee of the Trust.
[54] Also it is claimed that the Trust’s losses have now been ‘fully funded’ but the Court has not received any documentary evidence such as in the form of bank statements or tax returns to support this.
[55] Mr Mawhinney’s position is that he is the plaintiff “and is a trustee in” the Trust. In the statements of claim he refers to himself as the “trustee plaintiff”, and the Trust as the “taxpayer”. What he is saying is that it is his own financial position that ought to be considered when assessing whether costs could be paid if the Trust’s claim fails.
[56] Whilst acknowledging the Trust could not pay costs if the action was lost, Mr
Mawhinney opposes costs for two reasons:
(a) Because he personally would be able to meet those costs; and
(b)Mr Mawhinney believes the claim has “very strong prospects of success”.
Ability to pay
[57] Mr Mawhinney says he together with Waitakere Forest Trust Limited is the registered proprietor of a land lot in which he says there is an equity of $3.2M; that the subject land has a valuation rating of $4.5M; that although that lot is subject to two registered mortgages the first of those is owed about $1.2M only whilst the second is held by himself and another as mortgagee. Therefore he says there is an equity of not less than $3.2M in that property.
[58] The Commissioner’s records disclose that Mr Mawhinney’s only income is as a superannuitant. Mr Mawhinney says this does not mean he could not pay costs awarded. He does not explain how the land value could be accessed for the purpose of paying costs. Presently the local rating authority is pursuing recovery of a significant sum for rates arrears in respect of that land.
[59] Mr Mawhinney was discharged from bankruptcy about nine months ago.
[60] Mr Mawhinney says that if there is any element of impecuniosity it is because of the actions of the Commissioner in refusing to pay those GST refunds he says are due. Whether that is so will depend on the inquiry of the Commissioner’s view that the GST claim is considered to be part of a fraudulent activity.
Merit of claims
[61] The essential ingredients of this proceeding are apparent from the background factual explanation given in the strike out part of this judgment. The Commissioner explained reasons for refusing a GST refund in connection with suspicion of fraud. Mr Mawhinney for the Trust challenged this position by filing a NOPA. Mr Mawhinney’s position is that because of the failure of the Commissioner to respond then the plaintiff’s NOPA by law is deemed to have been accepted and therefore no challenge remains to the claim of the GST tax refund of $67,011.65 said to be due. In this Court’s view those issues will in due course be determined before the TRA.
[62] In his judgment upon Mr Mawhinney’s summary judgment claim Associate
Judge Bell concluded that the Commissioner had an arguable defence.
[63] Cooper J concluded that Mr Mawhinney’s dispute with the Commissioner should have been raised through the statutory disputes and challenge procedures in the TAA, and were not properly the subject of a review hearing in the High Court.
[64] As Mr Lemmon observes and as the Court has already noted Mr Mawhinney has filed three iterations of the statement of claim. The first running to 88 pages contained 19 separate breaches of statutory duty; a claim for money had and received; and six breaches of a duty of care claims. In his negligence claim he sought damages for “loss” that is the result of an Environment Court decision in relation to another tax payer.
[65] Mr Mawhinney’s amended statement of claim went to 156 pages and included a cause of action alleging statutory entitlement and also purported to include an application for judicial review.
[66] As earlier noted the second amended statement of claim ran to 188 pages and incorporated a further cause of action being the purported challenge under Part 8A of the TAA.
[67] It is not the Court’s purpose at this time to attempt an overall assessment of competing claims as to the merits. Those are properly left to a trial in due course. It is clear that a considerable factual enquiry will be required. But, it does appear that a number of the pleaded causes of action face significant hurdles.
[68] The Commissioner’s position is that Mr Mawhinney misunderstands the process and misapplies his perceptions of the statutory framework which regulates the process. At the heart of claims concerning alleged breaches of statutory duty it is clear that the TAA does not confer a right of challenge in relation to a matter under s
89C which is left to the discretion, judgment, opinion, approval, consent or determination of the Commissioner. Accordingly this tort claim presents as a collateral attack on the assessment, which is already being challenged in the appropriate forum; and therefore the Court has no jurisdiction to consider it.
[69] Mr Mawhinney’s position is that the plaintiff has no outstanding tax obligations and therefore has a statutory entitlement to a refund of excess GST. The Commissioner’s position is that no such statutory entitlement shall exist until such time as the Commissioner issues amended assessments acknowledging Mr Mawhinney’s NOPA for the period ended 31 July 2009. Likely this ground should fail because the appropriate forum for this dispute is the statutory disputes and challenge procedure which Mr Mawhinney is already currently engaged in.
[70] Mr Mawhinney’s claims for money had and received will also likely fail because no liability arises to pay any refund until it has been determined that it is a debt owed to the tax payer.
Conclusions
[71] The Court’s view concerning the impecuniosity of the Trust and Mr Mawhinney is clear. There is no clear reason to believe costs can be paid if the claims are unsuccessful.
[72] As Mr Lemmon submits it is inconsistent for the plaintiff to claim he is unable to pay filing fees and is not impecunious, while at the same time contending that the requirement of security could result in the plaintiff being blocked from pursuing his claim.
[73] It is not sufficient for Mr Mawhinney to claim he would meet costs. His contention does not allay the Court’s concerns of the ability of Mr Mawhinney to meet costs from his superannuitant’s income. Regarding the value in the land, it is clear that property is not owned by the Trust and that Mr Mawhinney has a connection to it by virtue of his being a mortgagor along with another company. The Court only has Mr Mawhinney’s calculations of value and an insufficiency of material to evaluate those.
[74] The Court is satisfied that the threshold of a requirement for payment of security has been met.
Security Amount
[75] Counsel for the Commissioner has calculated the sum of $40,000 is appropriate for an award of security. Counsel has provided his calculations of attendances to the conclusion of this hearing and anticipated appearances in connection with the trial. The Court has reviewed those and is of the opinion that should the Commissioner succeed in due course with a defence that the costs to be awarded would exceed the sum of $40,000 by a comfortable margin.
[76] In 2005 the High Court in the case of Mawhinney v Waitakere City Council
awarded security for costs to be paid where Mr Mawhinney claimed for damages of
about $6M asserting breaches of statutory duty, negligence and other issues. Security of $60,000 was fixed at that time.
[77] In this case the sum sought by way of security is a reasonable sum and it cannot be said it has been calculated to stop the claim being pursued.
Summary
[78] This judgment has already reviewed aspects of Mr Mawhinney’s claims of entitlement to pursue his claim afresh notwithstanding the judgment of Cooper J. Indeed he says because of that judgment it became clear the challenge aspect of the process could be brought before the High Court. That option, he considers, is not denied to him by the fact he has appealed Cooper J’s judgment. His reasons seem to be that the Court of Appeal judgment will be confined to issues regarding the conduct of the Part 4A process. Mr Mawhinney’s position is that that process has been completed and that he has a choice about where he pursues his right of action to the Part 8A process, and he has chosen the High Court for this.
[79] It is plain that Mr Mawhinney’s assumptions are wrong. The Part 4A process has not been completed, and it is very unlikely the High Court will accept jurisdiction to hear the challenge aspect of the process. Anyway the High Court considers the new fourth cause of action ought to be struck out for a number of reasons. They are:
(a) That claim which Mr Mawhinney has appealed to the Court of Appeal is the same claim he purports to make by his new fourth cause of action.
(b)Mr Mawhinney cannot succeed with his new fourth cause of action because it concerns issues which are currently the subject of the Part
4A process and is more properly dealt with there and by the TRA as
Cooper J has already directed.
(c) A challenge under the Part 8A process has to be brought in the correct manner, for the correct purpose and not by a cause of action or case appropriate to the nature of this proceeding because:
(i)The complaints are in substance an enquiry into the correct tax to pay and the process by which the Commissioner assessed that amount.
(ii)The TAA has power to confirm or cancel or vary an assessment or make an assessment which the Commissioner was able to make.
(iii)Because the matters at issue upon the strike out application are already in another proceeding and in a more appropriate forum the Court need not be concerned that in striking out this cause of action that Mr Mawhinney will be denied access to a justiciable remedy.
[80] The new fourth cause of action is prima face vexatious because it concerns precisely those issues which are for consideration upon the appeal of Cooper J’s judgment.
[81] For reasons already described, the Court considers the new pleaded cause of action to be a duplication of process and an abuse of process. In short Mr Mawhinney is attempting to relitigate a matter which has already been determined, whilst duplicating the proceedings that are currently underway pursuant to the dispute processes.
Judgment
[82] The fourth cause of action pleaded in the second amended statement of claim is struck out.
[83] Security for costs in the sum of $40,000 is ordered to be paid into Court to be held pending determination of this proceeding, and until that payment is lodged with
the Court this proceeding will be stayed.
Associate Judge Christiansen
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