McIlraith v Commissioner of Inland Revenue

IN THE COURT OF APPEAL OF NEW ZEALAND
CA371/2007
[2009] NZCA 442
BETWEENDONALD HAMISH MCILRAITH

Applicant

ANDTHE COMMISSIONER OF INLAND REVENUE

Respondent

Hearing:24 September 2009

Court:William Young P, Robertson and Baragwanath JJ
Counsel:Applicant in person

H W Ebersohn and L L de Claire for Respondent

Judgment:28 September 2009 at 2.30 pm

SUPPLEMENTARY JUDGMENT OF THE COURT

THE APPLICATION FOR RECALL OF THE JUDGMENT IS DECLINED.
____________________________________________________________________
REASONS OF THE COURT
(Given by Robertson J)
[1] In March 2009 we delivered judgment ([2009] NZCA 45) following a hearing on 18 February 2009 in an appeal from a reserved judgment of Asher J (HC HAM CIV 2003-419-208 M136/01 29 June 2007).
[2]       Our judgment dealt with both a challenge to assessments made by the Commissioner of Inland Revenue and an application for judicial review. The recall applied only to the latter.
[3]       In the letter which initiated the application, Mr McIlraith suggested that the Court had failed to consider the appellant’s written submissions, and that there were issues which were still alive that had not been considered.
[4]       This position was challenged by the respondent. A transcript of the hearing was obtained and made available.
[5]       Early in this hearing it emerged that Mr McIlraith’s real concern was still the issue of whether it was open to the Commissioner (and subsequently the High Court and then this Court) to find that a payment received by Mr McIlraith could be viewed in a variety of ways.
[6]       As was the case in the initial hearing, Mr McIlraith remained of the view that the characterisation of those payments was a matter of fundamental importance beyond the confines of the case.
[7]       It soon became clear that the Court had adjudicated on all matters that were properly before it and that there was no basis for the contention that the judgment should be recalled.
[8]       There is, however, one point which should be clarified. In [53] of the High Court judgment, Asher J said:
I have already refused to accept Mr McIlraith’s submission that the Commissioner was wrong in assessing the moneys he received from SCR and JIL as dividends. In case I am wrong in that conclusion, I go on to consider the alternative approach taken by the Commissioner, that the moneys received by Mr McIlraith were in the alternative remuneration, and that in any event on reconstruction following disallowance for tax avoidance, the Commissioner’s assessments were correct.

[9]       We did not interfere with that assessment, holding that such a conclusion was properly open to the High Court.
[10]     The primary conclusion of Asher J was that the monies Mr McIlraith received from SCR and JIL were dividends. The observations the Judge made thereafter were fall-back positions in case it was subsequently determined that his initial assessment was wrong. We have made no such determination.
[11]     What that means for consequential activities between Mr McIlraith and the Commissioner was not and is not a matter for this Court.
[12]     The application for recall is declined.
Solicitors:
Crown Law Office, Wellington

CaseChat Overview and Summary

The case of McIlraith v Commissioner of Inland Revenue involved a legal dispute between the applicant, Donald Hamish McIlraith, and the Commissioner of Inland Revenue. The applicant sought a judicial review of assessments made by the Commissioner. The case was heard in the Court of Appeal of New Zealand, with the hearing taking place on 24 September 2009. The judgment was delivered by Robertson J on 28 September 2009. The applicant represented himself while the respondent was represented by H W Ebersohn and L L de Claire.

The legal issues central to this case were twofold. The first issue concerned whether the Court had correctly considered the applicant’s written submissions and whether there were unresolved matters that had not been addressed. The second issue focused on the nature and characterization of payments received by the applicant, which had been a point of contention in the initial hearings. The respondent argued that the Court had indeed considered all relevant submissions and adjudicated on all matters properly before it.

In delivering the judgment, Robertson J examined the applicant's argument that the Court had failed to consider his written submissions and had overlooked certain issues. The Court reviewed the transcript of the initial hearing and found that all pertinent matters had been adjudicated. Robertson J clarified that the High Court had correctly assessed the payments as dividends, and any alternative views expressed were contingent positions. The Court concluded that there was no basis for recalling the judgment as it had properly adjudicated on the issues before it.

The Court declined the application for recall, reaffirming that the assessment of the payments as dividends was properly within the purview of the High Court and subsequently upheld by the Court of Appeal. The Court emphasised that the resolution of consequential activities between the applicant and the Commissioner was not within its remit. The final orders confirmed the declination of the recall application.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established