The Taxpayers and Commissioner of Taxation [2010] AATA 899 (15 November 2010)

Last Updated: 16 November 2010

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 899

ADMINISTRATIVE APPEALS TRIBUNAL ) No WT200500467-468

) No WT200600229

TAXATION APPEALS DIVISION		) No WT200600320-321 No WT200600526-529
	Re		“THE TAXPAYERS”

Applicants

And

COMMISSIONER OF TAXATION

Respondent

DECISION

Tribunal

Mr A Sweidan, Senior Member

Date 15 November 2010

Place Perth

Decision

The Tribunal reinstates the above applications under section 42A(10) of the Administrative Appeals Tribunal Act 1975.

..(sgd) Mr A Sweidan..................
Senior Member

CATCHWORDS

Practice and Procedure – application for reinstatement of applications dismissed due to applicants failure to appear at Directions and Dismissal Hearings – applicants failure to attend due to error by applicants in erroneously believing that they could resolve dispute with respondent outside of Tribunal procedures – Tribunal’s discretion exercised to reinstate applications under section 42A(10) of the Administrative Appeals Act 1975

LEGISLATION

Administrative Appeals Act 1975 s42A(10)

CASES
Myers and Commissioner of Taxation [2004] AATA 1337
Goldie and the Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 367
Brehoi and the Minister of Immigration of Multicultural Affairs [1999] FCA 772

REASONS FOR DECISION

15 November 2010	Mr A Sweidan, Senior Member
BACKGROUND AND HISTORY

1. These applications were dismissed by the Tribunal on 8 June 2010 under section 42A(2) of the Administrative Appeals Act (the Act) on the grounds of the applicants’ failure to appear at a Directions hearing on 24 May 2010 and a Dismissal Hearing on 8 June 2010.
2. The power of the Tribunal to reinstate an application under section 42A(8) and (9) of the Act requires the person whose application has been dismissed to apply to the Tribunal for reinstatement “within 28 days after receiving notification that the application has been dismissed”. Notice of the dismissal of the applications was posted to the applicants on 8 June 2010.
3. No application for reinstatement having been made within 28 days of the notice of dismissal, the Tribunal is unable to exercise the power to reinstate the applications under section 42A(8) and (9) of the Act.
4. However, the Tribunal also has power to reinstate an application under section 42A(10) of the Act. There is no time limit on when an application to reinstate may be made under section 42A(10). The power to reinstate under that section can only be exercised “if it appears to the Tribunal that an application has been dismissed in error”. It is recognised in the relevant authorities (see below) that such an error is not confined to an administrative error of the Tribunal and can be an error on the part of an applicant.
5. The applicants responded to a letter from the respondent’s solicitor seeking particulars of the basis on which the applicants contend that the applications were dismissed in error. In response to that letter the applicants’ representative wrote a letter to the Tribunal advising as follows:

5.1 The Tribunal has the power under this section of the Act to reinstate an application if it finds that an error has been made.

5.2 Firstly I should like to apologise to the Tribunal for my non attendance on those dates and try to give some understanding of why I was not able to continue to represent myself to the Court.

5.3 I was under a great deal of stress and strain. So much that I ceased working on grounds of ill health on the 18th of August 2010 and have closed my practice and I am trying to sell it.

5.4 At the time I was to represent myself in the AAT I was also a self represented litigant in the Family Court of Western Australia and was preparing an appeal to the Full Family Court of Australia, again as a SRL. That appeal was heard on the 1st July 2010.

5.5 I have attended approximately 24 hearings at the Family Court since February 2009, most of them self represented; mainly to do with children’s issues.

5.6 I also have proceedings afoot with the Medical Board of Western Australia which has been extremely stressful.

5.7 Throughout all of these legal proceedings I continued to work, full time, 40-45 hours per week, and virtually singlehanded in my own practice. I had 5 staff and a part time assistant.

5.8 I have made this application to reinstate my appeal at the request of Mr. Petrakis of the ATO and also to draw together the respective entities that owe tax and to reach a full settlement with the ATO.

5.9 Thus the error that I have made is in thinking that I could continue my negotiations and appeal against the ATO’s tax assessment outside the AAT.

5.10 The Tribunal should recognise that this error has been made by a person simply spread too thin and I was emotionally, intellectual; and physically exhausted. This was recognised by my doctor when he said that I was not fit for work from 19th August onwards. However in truth the extremely high work and litigation load that I was carrying affected me from May onwards.

6. At the hearing of the reinstatement applications the respondent’s Counsel advised that the respondent was not actively opposing the reinstatement of the dismissed applications but would abide the Tribunal’s decision.
7. The applicants’ representative who was the author of the letter referred to above confirmed under oath the truth of the contents of that letter.

TRIBUNAL’S FINDINGS

8. The Tribunal is of the view that the facts of this matter are similar in some respects to those in the Tribunal decision of Myers and Commissioner of Taxation [2004] AATA 1337. In that matter the applicant had withdrawn his application due to an erroneous belief as to being questioned about matters relating to a client of the applicant if the application proceeded.
9. The evidence also showed that the applicant in that matter was in a strained mental state and that the situation led to him withdrawing his application on the basis that the applicant had made an error in determining a process that he ought to follow. The Tribunal found that apart from this error on the applicants part there was a contribution made by the Tribunal by way of an error in not clarifying with the applicant whether he wished to have his application automatically dismissed or whether he required some consideration to be given to the circumstances of which he had informed the Tribunal in effect applying for an adjournment.
10. Unlike in Myers in these applications there has been no error on the part of the Tribunal. However, it is clear from the decision in Myers and the authorities referred to in that decision (see Goldie and the Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 367 in which the full Federal Court declined to follow an earlier decision of the Full Court in Brehoi and the Minister of Immigration and Multicultural Affairs [1999] FCA 772 which had held that the error referred to in section 42A(10) must be an administrative error). In Goldie the joint judgment of Wilcox and Downes JJ held that the only limitations in section 42A(10) are):
    1. the Tribunal has dismissed the application; and
    2. that the act of dismissal was attended with error.

Their Honours noted that the language of the provision differed from that employed in the explanatory memorandum circulated at the time that s 42A(10) was introduced, and said at [29]:

[29] We do not think it is necessary, in order, to enliven the Tribunal’s power under s 42A(10), that the Tribunal, or a member or employee of the Tribunal, should have been at fault in relation to the dismissal. The fault may have lain elsewhere, provided it induced the error. For example, because of a mistake as to his or her instructions, a solicitor or other representative of a party might have wrongly consented to a dismissal order or filed a notice of discontinuance. No fault would attach to the Tribunal: but if the solicitor’s mistake induced the dismissal of the action, it could properly be said the application had been “dismissed in error”.

On this point Carr J agreed with the joint judgment, though supporting his opinion on broader grounds (at [77]):

[77] “in my view, there is a significant degree of desirability of persons being able to rely on the ordinary meaning conveyed by the word “error”. More importantly, s 42A(10) provides a mechanism of avoiding prolonging legal or other proceedings without compensating advantage. The mechanism is a relatively informal method of bringing a matter back to the Tribunal for reconsideration with a view to it being considered on the merits. It can be seen as a convenient, prompt and inexpensive means whereby errors which may have occurred in the exercise of the Tribunal’s default jurisdiction can be rectified. That is, any sort of error in dismissing an application summarily, whether the error be administrative error or any other error”.

11. In all of the circumstances in this matter and further having regard to the fact that the respondent did not actively oppose reinstatement of the applications the Tribunal is of the view that the applications should be reinstated under section 42A(10) of the Act. The Tribunal did not in these circumstances find it necessary to consider further issues similar to those which arise in an extension of time application i.e. questions of prejudice, the merits of the substantive application and the fairness of granting reinstatement as between the applicant and other persons in a like position.

DECISION

12. The Tribunal reinstates the above applications under section 42A(10) of the Administrative Appeals Tribunal Act 1975.

I certify that the 12 preceding paragraphs are a true copy of the reasons for the decision herein of Mr A Sweidan, Senior Member.

Signed: ..(sgd) T Freeman............

Associate

Date/s of reinstatement Hearing 21 October 2010

Date of Decision 15 November 2010

Representative for the Applicants Confidential

Representative for the Respondent Mr T Burrows

Australian Government Solicitor