Berry v Commissioner of Taxation

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 237 of 2015

JUDGE: DAVIES J DATE OF ORDER: 19 November 2015 WHERE MADE: MELBOURNE

1. The appeal be dismissed.
2. The application under the Administrative Decisions (Judicial Review) Act 1977 (Cth) and the application under the Judiciary Act 1903 (Cth) s 39B be dismissed.
3. The objection to competency filed by the first respondent on 21 May 2015 be dismissed.
4. The applicant pay the first respondent's costs of the proceeding. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 237 of 2015

JUDGE: DAVIES J DATE: 19 November 2015 PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 On 9 April 2015, the second respondent ("the Tribunal") dismissed Mr Berry's application for review of the decision made by the first respondent ("the Commissioner") to disallow Mr Berry's objection. The objection was against the Commissioner's refusal to release him from taxation liabilities due to serious hardship pursuant to s 340-5 of Schedule 1 to the Taxation Administration Act 1953 (Cth) ("TAA"). In dismissing the application, the Tribunal exercised the power under s 42A(5) of the Administrative Appeals Tribunal Act 1975 (Cth) ("AAT Act"). Section 42A(5) provides as follows: Dismissal if applicant fails to proceed or fails to comply with Tribunal's direction (5) If an applicant for a review of a decision fails within a reasonable time: (a) to proceed with the application; or (b) to comply with a direction by the Tribunal in relation to the application; the Tribunal may dismiss the application without proceeding to review the decision. 2 Mr Berry has brought an appeal under s 44 of the AAT Act against the Tribunal's decision to dismiss his application to the Tribunal pursuant to s 42A(5) of the AAT Act and joined applications under the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("ADJR Act") and s 39B of the Judiciary Act 1903 (Cth) ("Judiciary Act") seeking judicial review of the decision. Those applications rely on the same grounds as the appeal under s 44 of the AAT Act. The Commissioner has objected to the competency of the appeal on the basis that it does not raise any question of law and also objected to the competency of the ADJR Act application on the basis that there is no provision in the Federal Court Rules 2011 (Cth) ("Federal Court Rules") which permits an application under the ADJR Act to be joined with an appeal brought under s 44 of the AAT Act. 3 For the reasons that follow, I find that the appeal is competent but no legal error has been demonstrated in the Tribunal's exercise of the s 42A(5) power. This conclusion makes it unnecessary to consider the objection to competency of the ADJR Act application.

background 4 On 18 July 2014, Mr Berry applied to the Tribunal for review of the Commissioner's decision to disallow Mr Berry's objection against the Commissioner's refusal to grant him a release from his tax liabilities. 5 On 25 August 2014, the Tribunal made a direction that Mr Berry give the Tribunal and the Commissioner a Statement of Facts, Issues and Contentions and all reports, records or other documents on which he intended to rely at the hearing by 6 October 2014. On 8 October 2014, an amended direction was made by the Tribunal extending the date by which those documents were to be furnished to 3 November 2014. The amended direction was made at the request of the parties, as they had agreed to pursue without prejudice discussions. 6 On 5 November 2014, the Tribunal further amended the direction by extending the date for the provision of documents by Mr Berry to 27 January 2015. 7 Mr Berry did not comply with the directions made on 5 November 2014 and a directions hearing was held before Senior Member Fice on 27 February 2015. At that directions hearing, Mr Berry was represented by his solicitor, Mr Jepson, who applied for an adjournment of the proceeding for at least six months on medical grounds. The adjournment application was supported by a medical report dated 8 February 2015 from Mr Berry's treating psychiatrist, Dr Vickers. In his report, Dr Vickers stated that he had been treating Mr Berry fortnightly "for over the past 6 years" for depression and anxiety, that Mr Berry's psychiatric treatment was enabling him "to continue as a high profile partner in a legal firm dealing with extremely high profile matters" but that "Mr Berry has had exacerbations of depression and anxiety". Dr Vickers expressed the opinion that the AAT proceeding was causing the exacerbation of Mr Berry's depression and panic attacks and that a delay of at least 6 months for the hearing of his AAT tax case would allow Mr Berry to cope with all the added pressures of his family and work issues and prepare adequately for his appeal. 8 The Commissioner did not oppose Mr Berry's request for an adjournment but took the position that he would be "guided by the [Tribunal] with regard to the length of the adjournment if granted." 9 Mr Jepson gave the following unchallenged account of the directions hearing in an affidavit sworn on 6 May 2015 in this proceeding: When this matter came before the Tribunal on 27 February 2015, Senior Member Fice said he had difficulty in accepting that Mr Berry was unable to proceed with his Application and provide the necessary evidence. Senior Member Fice said that in view of Mr Berry's ability to conduct the business of a Legal Practitioner he had grave concerns in granting any adjournment. Senior Member Fice ordered that I provide the Tribunal with a copy of Dr Vickers['] report and that he would indicate whether he would then allow an extension but not for the 6 months and that he would respond shortly. Senior Member Fice repeated that he was really troubled in granting any extension and he wanted the application to be brought on for hearing without any further delays. 10 The Tribunal did not grant the six month adjournment that was sought. Instead, on 2 March 2015 the Tribunal extended the date by which Mr Berry was to provide his Statement of Facts, Issues and Contentions and other documents to 30 March 2015. In addition, the Tribunal directed that by 30 March 2015, Mr Berry lodge with the Tribunal and serve on the Commissioner a signed statement of the evidence to be given by each witness intended to be called at the hearing. 11 On 30 March 2015, Mr Jepson wrote to the Tribunal attaching correspondence received from Dr Millar at the Epworth Hospital Richmond, certifying that Mr Berry had been admitted to Epworth Hospital for a cardiac procedure on 27 March 2015 and that Mr Berry would be unable to work until 1 April 2015. Mr Jepson wrote that Mr Berry could not comply with the directions made on 2 March 2015 and requested that the directions be stayed for a further 14 days to enable him to obtain instructions from Mr Berry and respond to the Tribunal. 12 On 2 April 2015, the Commissioner wrote to the Tribunal requesting that a further directions hearing by telephone be listed in order to determine the actions to be taken by both parties, noting that pursuant to the orders made on 2 March 2015, the Commissioner was required to lodge his Statement of Facts, Issues and Contentions and all other relevant materials on or before 13 April 2015. In light of Mr Berry's failure to comply with the 2 March 2015 directions, the Commissioner sought an extension of time to file his material to 14 days after receipt of Mr Berry's Statement of Facts, Issues and Contentions. 13 The Tribunal notified Mr Jepson by letter dated 2 April 2015 that the matter had been listed for an "Interlocutory Hearing by telephone - Dismissal Application" on 9 April 2015 before the Senior Member. 14 On 8 April 2015, Mr Berry swore an affidavit which was filed in the Tribunal proceedings. In that affidavit Mr Berry described his understanding of his current medical condition and deposed, amongst other things, that he would be "unable to deal with [his] appeal before [the] Tribunal" for at least another 14 days, when he had his next appointment with his heart specialist. He also deposed that: I have today visited Dr Russell Vickers who has been treating me every 2 weeks for the past 6 years and has already provided a report concerning some of my health and personal issues in this matter to the Tribunal. He has again today reiterated to me the opinion expressed in his recent report to the Tribunal that the matter should be adjourned for 6 months to allow me to properly present my case at a time when I am hopefully able to adequately do so. Dr Vickers says his original view on timing for the hearing is now even more reinforced by the current heart and stress issues (and my other health and personal issues) from which I am currently suffering. 15 Mr Jepson represented Mr Berry at the hearing on 9 April 2015, which was conducted by telephone. At that hearing, Mr Jepson relied on the certificate from Dr Millar, the report from Dr Vickers of 8 February 2015 and Mr Berry's affidavit sworn on 8 April 2015. Mr Jepson gave the following unchallenged account of the hearing in his affidavit: I said that as the [Commissioner] was not opposing the adjournment it was not appropriate to strike out the Application as the only one suffering any prejudice by such action would be the Applicant himself. Senior Member Fice said that "he (sic) was very unhappy about any further delay and that he considered that Mr Berry had the same issues that he had for the last 7 years and that this (being the application) can't go on and will not go on". He said that he did not believe that Mr Berry was unable to proceed with this application and that as Mr Berry had done nothing before the Tribunal he was going to strike the Application out. I said that it was not the case and that we have proceeded with the Application, have met with the ATO and were compiling information as requested by the ATO for the purposes of further discussions. Mr Hennebry acknowledged to the Tribunal that I had provided them with medical evidence that I was relying upon and that they would not oppose a short adjournment. Senior Member Fice said there was no change in the medical condition of Mr Berry from his past condition over a very long period and despite his medical issues he was holding down a role as Partner in a law firm and this was inconsistent with being unable to deal with his Application before the Tribunal. He said that the recent cardiac procedure only had him out of the office for several days and that Mr Berry was functioning as a lawyer and that as far as he could see there was no change in Mr Berry's condition from 2008 through to the present time and that he had no alternative but to dismiss the Application. 16 On 9 April 2015, the Tribunal dismissed Mr Berry's application under s 42A(5) of the AAT Act. The order made was as follows: The Tribunal is satisfied that the Applicant has failed within a reasonable time to proceed with the application and comply with directions made by the Tribunal under section 33(2) of the Administrative Appeals Tribunal Act 1975 (AAT Act) in relation to the application. Pursuant to s 42A(5) of the AAT Act, the Tribunal dismisses the application. 17 By letter to the Tribunal dated 7 May 2015, Mr Jepson advised that Mr Berry had commenced an appeal against the dismissal decision. Mr Jepson requested a copy of the reasons for decision and enquired whether a transcript of the hearing on 9 April 2015 was available. The request was followed up by an email sent on 1 June 2015. On 22 June 2015, Mr Jepson received telephone advice from the Registry that there were no published reasons for decision and no transcript of the hearing. In a further letter to the Tribunal dated 23 June 2015, Mr Jepson referred to his letter of 7 May 2015 and made a formal request under s 43(2A) of the AAT Act for a statement in writing of the reasons of the Tribunal for its decision. The Registry advised that the Senior Member was on leave but that at the conclusion of the hearing on 9 April 2015, the Senior Member had made hand-written notes of the hearing. Mr Jepson was given a copy of those notes.

the tribunal reasons 18 The parties have proceeded in this matter on the basis that the hand-written notes contain the reasons of the Tribunal for dismissing Mr Berry's application. Those notes record as follows: 1. Jeppson (sic) explained reasons for failure to comply with directions - all medical, relating to recent procedure at Epworth and stress and anxiety he [the Applicant] suffers from. 2. The Respondent suggested a 2 week extension to comply with the last directions. 3. I decided this matter should be dismissed under s 42A(5) for failure to proceed and failure to comply with directions. My reasons are: a. this matter was lodged with the Tribunal on 21/7/14; b. since lodgment not one piece of paper has been lodged to support his claim in 9 months; c. Applicant has failed to comply with directions made on 25/8/14, 8/10/14, 5/11/14, 2/3/15; d. on 30/3/15, Applicant's solicitor has requested a further 2 weeks to comply with the directions of 2/3/15 due to the Applicant's health; d. (sic) the letter of 30/3/15 had attached a letter dated 27/3/15 from Epworth (Dr Robert Millar) stating he had been admitted for a cardiac procedure. Dr Millar [illegible] Applicant unable to work until 1/4/15; e. Applicant has continued to work as a Partner in the IP firm Griffith and Hack earning a very substantial income; f. the affidavit lodged by the Applicant sworn on 8/4/15 sets out in detail Applicant's medical problems and why he cannot comply with directions. This is in stark contrast to the letter from Dr Millar which said he would be fit for work on 1/4/15. g. I had a letter from Dr Russell Vickers, psychiatrist, stating he had treated Applicant for 6 years. He needed 6 months delay for his appeal against the ATO. h. of major concern is a letter from the Applicant's solicitor, Jeppson (sic) dated 4/6/08 to the ATO. It refers to Applicant's health and that he should not be put under any stress and further, he was then undergoing medical treatment. (see T docs page 62). i. the reasons given by the Applicant for not being able to deal with his tax matters remain essentially unaltered since 2008, ie 7 years and cannot proceed due to health issues; j. granting a 2 week extension to comply with directions would have been pointless; k. there are many other letters written by Jeppson (sic) which explain delays and inability to do things on health grounds.

Questions of law and grounds for review 19 Seven questions are raised in the Notice of Appeal and supported by grounds containing particulars: (1) Did the Tribunal, in deciding to dismiss the application, make a decision that was so unreasonable that no reasonable Tribunal could have arrived at it? (2) Did the Tribunal, in deciding to dismiss the application, arrive at a decision that was not reasonably open on the facts before the Tribunal? (3) Did the Tribunal fail to take into account relevant considerations? (4) Did the Tribunal take irrelevant considerations into account? (5) Did the Tribunal deny the applicant procedural fairness? (6) Would a fair-minded lay observer reasonably apprehend that the Tribunal did not bring an impartial mind to the question whether to dismiss the applicant's application? (7) Did the Tribunal fail to provide adequate reasons for its decision? 20 The seventh question was not pressed at the hearing. 21 The ADJR Act application pleaded that: (1) The making of the decision was an improper exercise of the power conferred under s 42A(5) of the AAT Act; and (2) The decision involved an error of law. 22 These allegations were supported by the same grounds which are contained in the Notice of Appeal. 23 The Judiciary Act application relied on the affidavit of Mr Jepson sworn on 6 May 2015 and sought orders that the decision of the Tribunal be set aside and the proceeding be remitted to the Tribunal, to a member other than Senior Member Fice, for hearing and determination on the merits in accordance with a suitable interlocutory timetable.

Objection to competency of the appeal 24 The Commissioner's grounds of objection to competency are two-fold: (1) The Notice of Appeal does not raise a question of law for the purposes of s 44(1) of the AAT Act. (2) The questions of law identified under the heading "Questions of Law", properly analysed, are not questions of law.

Does the notice of appeal raise a question of law? 25 Whether or not there is a question of law raised by the Notice of Appeal cannot be determined by the form of the questions themselves. Whilst the questions are formulated in judicial review terms, merely to frame a question in such terms does not identify a question of law enlivening the jurisdiction of the Court under s 44 of the AAT Act. Whether the appeal is on a question of law is not determined by whether the questions use formulaic language for grounds of judicial review, and simply to embrace the language of judicial review is not to state a question of law: Haritos v Commissioner of Taxation [2015] FCAFC 92 at [92]. As the Full Federal Court stated in Haritos at [92]: We agree with Ryan J in Lambroglou that merely to assert that the Tribunal erred in law in making a particular finding is not to state a question of law. We also agree with the later statement by Ryan J, at 527, that: "[I]t simply begs the question of law to commence it with the words 'whether the Tribunal erred in law'… In the present case, the form of each of the questions is a generalised statement which contains no relevant content to enliven the jurisdiction of the Court under s 44 of the AAT Act. The content can only be distilled from a consideration of the grounds that follow in the Notice of Appeal. But that is not the function of the grounds of appeal: Osland v Secretary, Department of Justice (No 2) (2010) 241 CLR 320; [2010] HCA 24 at [21]. Further, so drafted, the Notice of Appeal does not comply with r 33.12(2) of the Federal Court Rules. 26 Rule 33.12(2) of the Federal Court Rules provides as follows: (2) The notice of appeal must state: (a) the part of the decision the applicant appeals from or contends should be varied; and (b) the precise question or questions of law to be raised on the appeal; and (c) any findings of fact that the Court is asked to make; and (d) the relief sought instead of the decision appealed from, or the variation of the decision that is sought; and (e) briefly but specifically, the grounds relied on in support of the relief or variation sought. 27 The reason that the Notice of Appeal must specify the question or questions of law with precision is that an appeal under s 44 of the AAT Act can only be on a question of law and the ambit of the appeal is confined to the question of law so raised: Haritos [2015] FCAFC 92, [62]. In Haritos at [62], the Full Federal Court emphasised that the statement of the question of law with sufficient precision is a matter of great importance to the efficient and effective hearing and determination of appeals from the Tribunal because the question of law both confers the jurisdiction on the Federal Court in respect of the appeal under s 44 of the AAT Act and limits the subject-matter of the appeal. 28 The function of the requirement in r 33.12(2) to set out the grounds relied upon in support of the order sought is different, namely to indicate how the appellant relies on the stated questions of law to support the orders sought on the appeal: Australian Securities and Investments Commission v Saxby Bridge Financial Planning Pty Ltd (2003) 133 FCR 290; [2003] FCAFC 244 at [47]; Osland v Secretary, Department of Justice (No 2) (2010) 241 CLR 320; [2010] HCA 24 at [21]. In Saxby the Full Federal Court emphasised that there is a distinction between the questions of law to be raised on the appeal and the grounds relied upon in support of the orders sought: at [47]-[48] (Branson J) and at [108] (Jacobson and Bennett JJ). In Osland the High Court referred to Saxby, stating that questions of law are not to be distilled from the grounds of appeal: at [21] (French CJ, Gummow and Bell JJ). 29 Although there has been clear non-compliance with r 33.12(2), the non-compliance is not determinative of whether there is a competent appeal on foot. In Haritos at [62], the Full Federal Court summarised the law as follows: We now turn to consider the more general questions raised by the appeal in relation to s 44 of the AAT Act. In summary, our conclusions are as follows: 1. The subject-matter of the Court's jurisdiction under s 44 of the AAT Act is confined to a question or questions of law. The ambit of the appeal is confined to a question or questions of law. 2. The statement of the question of law with sufficient precision is a matter of great importance to the efficient and effective hearing and determination of appeals from the Tribunal. 3. The Court has jurisdiction to decide whether or not an appeal from the Tribunal is on a question of law. It also has power to grant a party leave to amend a notice of appeal from the Tribunal under s 44. 4. Any requirements of drafting precision concerning the form of the question of law do not go to the existence of the jurisdiction conferred on the Court by s 44(3) to hear and determine appeals instituted in the Court in accordance with s 44(1), but to the exercise of that jurisdiction. 5. In certain circumstances it may be preferable, as a matter of practice and procedure, to determine whether or not the appeal is on a question of law as part of the hearing of the appeal. 6. Whether or not the appeal is on a question of law is to be approached as a matter of substance rather than form. 7. A question of law within s 44 is not confined to jurisdictional error but extends to a non-jurisdictional question of law. 8. The expression "may appeal to the Federal Court of Australia, on a question of law, from any decision of the Tribunal" in s 44 should not be read as if the words "pure" or "only" qualified "question of law". Not all so-called "mixed questions of fact and law" stand outside an appeal on a question of law. 9. In certain circumstances, a new question of law may be raised on appeal to a Full Court. The exercise of the Court's discretion will be affected not only by Coulton v Holcombe [1986] HCA 33; 162 CLR 1 considerations, but also by considerations specific to the limited nature of the appeal from the Tribunal on a question of law, for example the consideration referred to by Gummow J in Federal Commissioner of Taxation v Raptis [1989] FCA 557; 89 ATC 4994 that there is difficulty in finding an "error of law" in the failure in the Tribunal to make a finding first urged in this Court. 10. Earlier decisions of this Court to the extent to which they hold contrary to these conclusions, especially to conclusions (3), (4), (6) and (8), should not be followed to that extent and are overruled. Those cases include Birdseye v Australian Securities and Investments Commission [2003] FCA 232; 76 ALD 321, Australian Securities and Investments Commission v Saxby Bridge Financial Planning Pty Ltd [2003] FCAFC 244, 133 FCR 290, Etheridge, HBF Health Funds and Hussain v Minister for Foreign Affairs [2008] FCAFC 128; 169 FCR 241. The Court also stated at [94]: In our opinion, the issue must be approached as one of substance. In cases of doubt, the Court should consider the notice of appeal, the alleged question or questions of law, the grounds raised, the statutory context, and the Tribunal's reasons for its decision, and having considered all those matters, satisfy itself that there is in fact a question of law. Thus, in considering the competency of the appeal, the question as to whether or not the appeal is on a question of law is to be approached as a matter of substance, not only by the form of expression of the questions themselves. 30 Although the questions themselves are uninformative, legal matters for determination on appeal can nonetheless be distilled from the particulars supporting the grounds. From those particulars, it can be seen that Grounds 1-4 are each directed at the nature and scope of the Tribunal's power under s 42A(5) of the AAT Act, Ground 5 at whether there was a denial of procedural fairness and Ground 6 at whether the decision is vitiated by apprehended bias. Each of them raises issues of law for determination. It should not be taken, however, that the objection to competency was without foundation. As stated, the questions posited as the questions of law did not expressly state any questions of law at all, let alone state questions of law with precision as the Federal Court Rules require. The Notice of Appeal is plainly defective in that the questions of law are only revealed by the grounds, and it should not be thought that it is acceptable to submit a notice of appeal in that form: Osland (2010) 241 CLR 320; [2010] HCA 24 at [21] and Saxby Bridge (2003) 133 FCR 290; [2003] FCAFC 244 at [47]-[48], [108]. 31 I now turn to the merits of each of the questions.

Question 1: Whether no reasonable person could have made the decision 32 This question was particularised as follows: The learned Senior Member, in dismissing the application, deprived the Applicant of a hearing before the Tribunal to determine the issues in dispute in circumstances where the Applicant was seeking an extension of time to comply with interlocutory orders, the uncontested evidence before the Tribunal was that the Applicant was unable to comply with the interlocutory timetable that had been set because of medical conditions, including a period when he was in hospital, and the [Commissioner] was not opposed to an extension of time. The application was made to the Tribunal on 18 July 2014 and the application was dismissed on 9 April 2015. This length of time is not an unreasonable amount of time or alternatively is not an unreasonable amount of time having regard to the circumstances of the applicant. 33 It was submitted that the decision to dismiss Mr Berry's application to the Tribunal was unreasonable in the legal sense because: (1) it closed all avenues of review of the objection decision to Mr Berry; (2) the Tribunal had other options open to it that would not have denied Mr Berry a hearing; (3) the Commissioner was not seeking dismissal of the application and was amenable to an extension of the interlocutory timetable; (4) the Tribunal had evidence before it of significant and substantive reasons why Mr Berry had been unable to comply with the interlocutory timetable; (5) the uncontested medical evidence was that Mr Berry required at least six months to be able to comply with the Tribunal's interlocutory timetable in the face of the extra personal, family and professional responsibilities that had manifested since making the application to the Tribunal; (6) the Tribunal elided previous medical conditions with Mr Berry's "new and significant" medical condition; (7) the decision was made in circumstances where Mr Berry was seeking an extension of time to comply with the interlocutory orders; (8) there was evidence before the Tribunal that Mr Berry had been in communication with the Commissioner about progressing the application before the Tribunal; and (9) Mr Berry had not failed within a reasonable time to proceed with the application and comply with the Tribunal's directions. It was submitted that the period of time between making the application to the Tribunal and its dismissal was less than nine months which was not an unreasonable amount of time, or alternatively, was not an unreasonable amount of time having regard to the circumstances of Mr Berry. 34 The most recent consideration by the High Court of the judicial review ground of "unreasonableness" in administrative decision making is in Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18. In Li, the High Court held that a decision of the Migration Review Tribunal to refuse an application for an adjournment of a merits review hearing was so unreasonable as to constitute jurisdictional error. At [68], the plurality (Hayne, Kiefel and Bell JJ) stated that: The legal standard of unreasonableness should not be considered as limited to what is in effect an irrational, if not bizarre, decision - which is to say one that is so unreasonable that no reasonable person could have arrived at it. Further at [76] the plurality said: As to the inferences that may be drawn by an appellate court, it was said in House v The King that an appellate court may infer that in some way there has been a failure properly to exercise the discretion "if upon the facts [the result] is unreasonable or plainly unjust". The same reasoning might apply to the review of the exercise of a statutory discretion, where unreasonableness is an inference drawn from the facts and from the matters falling for consideration in the exercise of the statutory power. Even where some reasons have been provided, as is the case here, it may nevertheless not be possible for a court to comprehend how the decision was arrived at. Unreasonableness is a conclusion which may be applied to a decision which lacks an evident and intelligible justification. The requirement of reasonableness flows from, or is connected with, an implied legislative intention that a discretionary power that is statutorily conferred must be exercised reasonably: Li at [29], [63] and [88]. Thus the issue is whether the exercise of discretion itself, in its outcome, can be said to be unreasonable in a legal sense having regard to the scope, subject and purpose of the particular statutory power exercised. In considering whether the power was exercised in a way that is legally unreasonable, it is not the function of the Court to substitute its own decision for that of the Tribunal or to conduct a merits review and determine whether the Tribunal's decision was right or wrong in a substantive sense. Where there are reasons, the question is whether the reasons given for the exercise of the discretion lacked an "evident and intelligible justification" for the decision. 35 The starting point for consideration is the scope and purpose of s 42A(5) of the AAT Act. That section confers a discretionary power on the Tribunal to dismiss an application for review of a decision without proceeding to review that decision if the applicant fails within a reasonable time to proceed with the application or to comply with a direction by the Tribunal in relation to the application. That power is in aid of the objective in s 2A of the AAT Act. Section 2A provides: In carrying out its functions, the Tribunal must pursue the objective of providing a mechanism of review that: (a) is accessible; and (b) is fair, just, economical, informal and quick; and (c) is proportionate to the importance and complexity of the matter; and (d) promotes public trust and confidence in the decision-making of the Tribunal. 36 Section 33 is also relevant. Section 33(1)(b) relevantly provides that in a proceeding before the Tribunal: The proceeding shall be conducted with as little formality and technicality, and with as much expedition, as the requirements of this Act and of every other relevant enactment and a proper consideration of the matters before the Tribunal permit. For the purposes of s 33(1), the Tribunal may give directions as to the procedure to be followed at or in connection with the hearing of a proceeding: s 33(2). Section 33(2A) sets out the types of directions that the Tribunal may make, which include requiring any person who is a party to the proceeding to provide further information in relation to the proceeding (s 33(2A)(a)) and requiring any person who is a party to the proceeding to provide a statement of matters or contentions upon which reliance is intended to be placed at the hearing (s 33(2A)(c)). Section 33(1AB) provides that a party to a proceeding before the Tribunal and any person representing such a party must use his or her best endeavours to assist the Tribunal to fulfil the objective in s 2A of the AAT Act. 37 The power to dismiss under s 42A(5) is "plainly a valuable discretionary power", as Burchett J observed in Guse v Comcare (1997) 49 ALD 288; [1997] FCA 140, 291 (ALD). Where the provision is engaged, the exercise of that power to dismiss summarily aids the Tribunal in fulfilling the objective in s 2A. The consequence of a failure by an applicant either to proceed with the application or to comply with a direction by the Tribunal in relation to the application within a "reasonable time" is that the applicant is liable to have his or her application dismissed without a hearing on the merits. Such an outcome may seem harsh but because the outcome is specifically provided for by the legislation, that outcome, in itself, is not one that is unreasonable in the legal sense. Thus, I do not accept the submission for Mr Berry that the exercise of power was unreasonable in the legal sense because it closed all avenues of review of the objection decision to Mr Berry. 38 I also do not accept the submission for Mr Berry that the exercise of power was unreasonable in the legal sense because the Tribunal had other options available to it other than dismissal. This submission drew upon the observation of Burchett J in Guse v Comcare at 291 that: The very nature of the discretion seems to me to demand that the Tribunal consider, after the default has occurred, whether in the circumstances then obtaining, "a reasonable time" has elapsed, and whether the proper remedy is dismissal of the application, or the taking of some other course, such as adjourning the proceeding or making some other order to secure compliance - and the further statement by Burchett J that the power should be used "very sparingly and only…as a decision of last resort": Guse v Comcare (1997) 49 ALD 288, 291. 39 In determining whether to exercise the power it may be a consideration for the Tribunal as to whether some other course, other than dismissal, should be taken to secure compliance. However, as French CJ stated in Li at [30], "the requirement of reasonableness is not a vehicle for challenging a decision on the basis that the decision-maker has given insufficient or excessive consideration to some matters or has made an evaluative judgment with which a court disagrees even though that judgment is rationally open to the decision maker". The issue is whether there is an evident and intelligible justification for the exercise of power. 40 In the present case, the reasons disclose an evident and intelligible justification for the exercise of power. Apart from lodging his application, Mr Berry had not filed any documents supporting his application or complied with any of the Tribunal's directions. The Tribunal did not accept that Mr Berry's psychological state had prevented him from prosecuting his application, noting that despite his problems Mr Berry had continued to work as a partner in a legal firm earning a very substantial income. The Tribunal also did not accept Mr Berry's claim that he was unable to deal with his application for at least another 14 days due to his recent cardiac procedure, which the Tribunal stated was "in stark contrast" to the medical certification from his doctor. There is nothing capricious, unjust or unintelligible about that reasoning. Further, it is evident that the Tribunal did not consider that there was any reasonable prospect of compliance, even if a further extension was granted, pointing out that the reasons given by Mr Berry for the delays had remained essentially unaltered since 2008. That reasoning process does not disclose legal error. That consideration was raised by the material before the Tribunal and probatively bore upon the matters falling for consideration in the exercise of the statutory power. Contrary to the submission for Mr Berry, the earlier history was not an irrelevant consideration. 41 The balance of the submissions for Mr Berry regarding the legal unreasonableness ground directed attention at the material taken into account by the Tribunal. These submissions amounted, in substance, to a challenge to the decision on the merits. As stated, it is not the function of the Court to determine whether the Tribunal's decision was right or wrong in a substantive sense.

Question 2: Whether the decision was not reasonably open on the facts 42 This question was particularised as follows: The learned Senior Member, in dismissing the application, deprived the applicant of a hearing before the Tribunal to determine the issues in dispute and in so doing ignored unchallenged medical evidence that the Applicant required additional time to comply with directions made by the Tribunal. 43 It was submitted for Mr Berry that the only finding reasonably open to the Tribunal was that Mr Berry had not failed within a reasonable time to comply with the Tribunal's directions and "indeed reasonably required more time to do so". The basis of that contention was said to be that: (1) there was no evidence to support the Tribunal's finding that Mr Berry had "done nothing" or was not proceeding with the application; (2) there was no evidence to support the Tribunal's finding that there was no change in Mr Berry's medical condition from his past condition, when the evidence was that he had recently been hospitalised for a heart condition which he had never experienced previously; (3) there was no evidence to support the Tribunal's finding that Mr Berry had the same issues that he had in the last seven years, as Dr Vickers' report detailed additional personal, family and work issues that had besieged Mr Berry since 2013; (4) the Tribunal had before it the unchallenged medical evidence from Dr Vickers that Mr Berry required additional time of at least six months "to cope with all the added pressures of his family, work issues and prepare adequately for [the Tribunal hearing]"; and (5) the unchallenged medical evidence before the Tribunal was that Mr Berry had been admitted to hospital some ten days previously and had undergone an invasive procedure due to concerns about his heart condition. 44 The written submissions go well beyond the ground as pleaded. No point was taken by the Commissioner but, in any event, there is no merit either in the pleaded ground or the case as presented on the written submissions. The "no evidence" submission cannot be accepted. It was open to the Tribunal not to accept the reliability of the evidence from Mr Berry and, on the material before the Tribunal, and for the reasons given by the Tribunal, it was reasonably open to the Tribunal to find that the factual pre-conditions to the exercise of the power to dismiss under s 42A(5) of the AAT Act were satisfied and that the power of dismissal should be exercised.

Question 3: Whether the Tribunal failed to take into account relevant considerations 45 This question was particularised as follows: The learned Senior Member ought to have taken into account: i. The particular circumstances of the taxpayer as disclosed in the affidavit of the Applicant dated 8 April 2015 which was before the Tribunal; ii. The explanation given on behalf of the Applicant for his inability to comply with the interlocutory timetable; iii. The unchallenged medical evidence that the Applicant was in hospital at the time of the telephone hearing on 9 April 2015 and was suffering from a number of serious physical and psychological conditions meaning that he required additional time to comply with directions made by the Tribunal; iv. That an adjournment would not cause prejudice to the First Respondent and the First Respondent did not suggest any prejudice; v. That the First Respondent was not opposed to an alteration of the interlocutory timetable. 46 This ground has no merit either. As to the first three particulars, the reasons for decision of the Tribunal expressly disclose that the Tribunal took into account the content of Mr Berry's affidavit sworn on 8 April 2015, Mr Berry's explanation for his inability to proceed with the application and to comply with the Tribunal's directions and the medical evidence relied upon by Mr Berry. The Tribunal did not accept Mr Berry's explanation and it was open to the Tribunal to reject the explanation given by Mr Berry. Further, it is clear from the Tribunal's reasons that the Tribunal had regard to the impact of Mr Berry's current condition on his ability to comply with the Tribunal's directions but reasoned that a further two week adjournment was "pointless" in view of Mr Berry's continued assertion of health issues. 47 As to the other matters, whilst the reasons do not record that the Tribunal did take into account that the Commissioner did not oppose the adjournment and was not asserting any prejudice by any further adjournment, the ground of failure to take into account a relevant consideration will only be established if the Tribunal was bound to take those matters into account in the exercise of the power under s 42A(5) of the AAT Act: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40 at 39 (CLR) (Mason J). In an appropriate case, those matters may weigh in the consideration of the exercise of the power under s 42A(5), but having regard to the nature, scope and object of the section and the AAT Act, the Commissioner's position was not a mandatory consideration that the Tribunal had to take into account in the exercise of discretion.

Question 4: Whether the Tribunal took irrelevant considerations into account 48 This question was particularised as follows: The learned Senior Member ought not to have taken into account: vi. The history of the matter prior to the making of the application to the Tribunal; and vii. The applicant's status as a solicitor as indicating whether he was capable of complying with directions made by the Tribunal. viii. The view formed by the Senior Member at the previous telephone mention on 25 February 2015 that a solicitor such as the Applicant should be able to comply with the directions made by the Tribunal. 49 The Tribunal clearly did take these matters into account but it cannot be said that it was impermissible to take them into account as factors relevant to the exercise of discretion under s 42A(5) of the AAT Act. The history of the matter prior to the making of the application to the Tribunal was not wholly irrelevant, given that Mr Berry was continuing to raise health issues as the explanation for non-compliance. Furthermore, it was plainly relevant that Mr Berry had continued to practise as a lawyer, yet maintained that his health prevented him from complying with the Tribunal's directions. Both matters probatively bore upon the exercise of discretion under s 42A(5).

Question 5: Whether there was a denial of procedural fairness 50 This question was particularised as follows: i. The Tribunal failed to identify to the Applicant prior to dismissing the application, to enable him to respond properly, the fact that the Tribunal considered that the fact that the Applicant was a solicitor was inconsistent with the Applicant being unable to comply with the interlocutory timetable. ii. The Tribunal, in dismissing the Application, failed to consider and/or to refer to, the evidence contained in the affidavit of the Applicant dated 8 April 2015, the medical evidence and the submissions made to the Tribunal by the Applicant's representative. 51 The written submissions repeated the first particular, but otherwise bore no relationship to the pleaded case. The additional complaint in the written submissions was that there was a denial of procedural fairness by reason that the Tribunal listed the dismissal application of its own motion at short notice and at a time when the Tribunal was aware, or ought to have been aware, that Mr Berry was not in a position properly to prepare any response. There is no merit in either claim. 52 First, it is clear that Mr Berry was given full and proper opportunity to be heard on 9 April 2015 on the question of whether the application should be dismissed under s 42A(5) of the AAT Act. Mr Berry both put on evidence in support of his opposition to that application, and at the telephone hearing, he was represented and submissions were made on his behalf. Nothing in the material indicates that Mr Berry was denied proper opportunity fairly and fully to present his case. 53 Secondly, the Tribunal's decision was based upon the evidence that Mr Berry himself put before the Tribunal. The Tribunal was entitled, as it did, to take into account the evidence that Mr Berry had continued to practise as a lawyer in determining that the power under s 42A(5) should be exercised. Procedural fairness did not require the Tribunal to disclose its proposed conclusions based upon that material or to expose its provisional views before making its decision: SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152; [2006] HCA 63, 166 (CLR) (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ); Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576; [1994] FCA 1074, 591 (FCR) (Northrop, Miles and French JJ).

Question 6: Whether the decision is vitiated by apprehended bias 54 This question was particularised as follows: Senior Member Fice had prejudged the application for an extension of the interlocutory timetable prior to considering the evidence of the Applicant in his affidavit sworn 8 April 2015, the medical evidence and the submissions of Mr Jepson acting on behalf of the Applicant. 55 Apprehended bias by reason of prejudgment is established where a reasonable observer might consider that the Tribunal's state of mind was so committed to a conclusion already formed as to be incapable of alteration, whatever evidence or arguments may be presented: Cabcharge Australia Limited v Australian Competition and Consumer Commission [2010] FCAFC 111 at [25]. 56 For this ground, it was argued in support for Mr Berry that the application was not made on the motion of the Commissioner but it was Senior Member Fice who proposed and scheduled the dismissal application, and the Senior Member had earlier rejected Mr Berry's application for a six month adjournment supported by the medical report from Dr Vickers. Thereby, it was said, the Tribunal had already made up its mind that Mr Berry's physical and medical condition and the additional personal, family and work stresses suffered by him since bringing the application to the Tribunal did not justify an extension beyond 30 March 2015. Further, the submissions for Mr Berry emphasised that the notes of the Tribunal's telephone hearing on 9 April 2015 recorded that the Tribunal decided to dismiss the matter under s 42A(5) for failure to proceed and failure to comply with directions. It was submitted that this suggested that the Senior Member had, contrary to law, already decided to dismiss the application before the telephone hearing on 9 April 2015 and that this was the impression gained by Mr Berry's legal representative during the telephone hearing, as attested to in the affidavit sworn by Mr Jepson on 6 May 2015. 57 It is well-established that a reasonable bystander does not necessarily entertain a reasonable fear that the decision-maker might have pre-judged an issue merely because the decision-maker has expressed a tentative view on the matter on an earlier occasion: Johnson v Johnson (2000) 201 CLR 488; [2000] HCA 48 at 493 (CLR) [12]-[13]. Furthermore, there is nothing in the account of the earlier directions hearing on 27 February 2015 that indicates that the Senior Member had a closed mind on the question of whether to dismiss the application under s 42A(5), irrespective of what further evidence or arguments might be presented to him. At most, on 27 February 2015 the Senior Member expressed a tentative view on the difficulty that Mr Berry might face in reconciling his explanation for his failures with respect to his application with his ongoing work as a partner in a law firm. Finally, the reference to the notes of the Tribunal does not advance this argument. The note does no more than record the decision that was made that day and provides no foundation for a claim of apprehended bias.

conclusion 58 No legal error has been demonstrated in the decision made by the Tribunal to dismiss Mr Berry's application for review under s 42A(5) of the AAT Act. Accordingly, the appeal should be dismissed, and both applications should also be dismissed as they rely on the same grounds of legal error raised by the appeal. In the circumstance there is no need to consider the objection to the competency of the ADJR Act application. I certify that the preceding fifty-eight (58) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Davies.