Victorian Civil and Administrative Tribunal|2006-05-05

Bradd v State Revenue Office (Taxation) [2006] VCAT 867 (5 May 2006)

Taxation List; Proceeding struck out for non-payment of fee; Applicant claims notices misdirected; Tribunal not functus officio; Discretion to reinstate; Reinstatement refused because review application doomed to fail

Would refer you to the above references and to the dealings between myself, my solicitor, Mr Fraser from Andrew T. Fraser and Associates and your Irena Berdichevsky.

According to correspondence received from Irena Berdichevsky, I have a "right to appeal" the decision, which I am now doing, and in doing so, hereby request you to refer this matter to the Victorian Civil and Administrative Tribunal.

I now look forward to presenting this case to the Tribunal for a fair and judicious outcome.

4 The Commissioner's delegate forwarded a referral to the Tribunal dated 8 February 2006. The referral included a summary of case and a statement of addresses for service. The address for service nominated in the referral so far as Mr Bradd was concerned was C/- Andrew T. Fraser and Associates, Solicitors, 541 Middlesborough Road, Box Hill North. The letter seeking referral as will be recalled was signed by Mr Bradd himself and not by Andrew T. Fraser and Associates.

5 An officer from the legal Services Branch of the State Revenue Office, Mr John Tan, was said to have made contact with Andrew T. Fraser and Associates. He spoke to Mr Fraser to confirm that Mr Fraser's office would be the address for service.

6 Mr Tan then forwarded a package of documents to Mr Bradd C/- Andrew T. Fraser and Associates including a folder of documents. The fate of that material remains a matter of speculation now. On the same day Mr Tan wrote to Mr Bradd personally, forwarding another compilation of documents to him in the expectation that Mr Fraser would continue to be acting. The letter stated:

Copies of the above documents have already been sent to your solicitors Andrew T. Fraser and Associates.

7 Amongst the documents that was forwarded was the notice giving Andrew T. Fraser and Associates, Solicitors, as the address for service for Mr Bradd. Also in this package was a copy of the document published by this Tribunal, 'Taxation List Information'. The document includes commentary and explanation of the procedures in this List and in particular notes that there is a prescribed application fee and:

Until that fee is paid or waived the Registry will take no further action. If the fee remains unpaid for 30 days the application may be referred to a member of VCAT to make an order striking out the application.

8 As it happened this is what occurred. Andrew T. Fraser and Associates took no action despite warning letters from the Tribunal and so on 14 March 2006, I made an order in chambers stating 'This proceeding is struck out.'

9 Mr Bradd says that he was unaware of all these events and knew nothing of the disposition of his review application until he made contact with the State Revenue Office on 27 March. At that stage he was told by Mr Tan that the matter was over and determined.

10 Consequently Mr Bradd wrote a letter to the Tribunal dated 28 March 2006 stating as follows:

Further to conversation today with your Department, under Section 120 of the VCAT Act, I now wish this matter to be reinstated.

As advised, I was unaware that Documents had been forwarded on to my Solicitor, Andrew T. Fraser & Associates, as the State Revenue Office was of the misunderstanding that they were acting on my behalf, THEY WERE NOT. Also as I mentioned, nowhere in my correspondence was I advised that I had to forward a cheque or take any action in fact to have this matter taken further. The first I became aware that I had to take any action was when I contacted the SRO on 27/03/06 and was told that the matter had been finalised. The letter to the SRO was written and signed by myself with my contact details for any return correspondence, giving the SRO no reason as to why they would send any Documents to my Solicitor. I am quite shocked and disappointed by the State Revenue Office's total lack of communication and professionalism throughout this entire matter and would sincerely like to have this matter dealt with by VCAT an independent party.

As I am personally dealing with this matter, I would appreciate that all future correspondence be forwarded to me directly at the above address NOT to Andrew T. Fraser & Associates.

I now await correspondence advising with regard to having this matter reinstated at VCAT.

11 Mr Bradd made this application on the basis that he was the innocent victim of a misdirection of documents in the circumstances and that justice required that his proceeding be reinstated. At the outset an issue arose as to the Tribunal's authority to make an order of reinstatement. Mr Bradd it will be recalled refers to Section 120 of the Victorian Civil and Administrative Tribunal Act 1998 in his letter seeking reinstatement. Section 120 of the Act authorises the Tribunal to re-open one of its determinations on substantive grounds. As Mr Kotros who appeared on behalf of the Commissioner to oppose the reinstatement application observed, the general principle established by the highest authority is that once a Court or Tribunal finally determines a matter, it cannot be re-opened save in pursuance of some specific statutory exception to the doctrine of functus officio. For present purposes the statutory exceptions to that rule of functus officio to be found in Section 119 of the Victorian Civil and Administrative Tribunal Act which is the Tribunal's equivalent of the slip rule which all Courts have and the Section 120 of the Act which enables an order of the Tribunal to be reopened where a person did not appear and was not represented at the hearing of which an order was made. The application of Section 120 in the present circumstances is problematic.

12 My order of strike-out was made in chambers, there was no hearing. Moreover, even although Mr Bradd has invoked Section 120 of the Act in my opinion that application is inappropriate. The premise of Mr Kotros' submission was that the order of a strike-out finally disposed of the proceeding such that the Tribunal was functus officio. In my view Section 120 is properly invoked only first, where there has been a hearing and secondly, where an order has been made that would otherwise render the Tribunal functus officio.

13 Mr Kotros submitted that an order of strike-out had that effect; but despite my request he was unable to cite authority in support of that proposition. In New South Wales Insurance Ministerial Corporation v Anderson an unreported decision of the Court of Appeal of New South Wales, Butterworth's Unreported Judgment Series BC9404890, the Court, Gleeson CJ, President of the Court of Appeal, Kirby J and Priestley J were considering the effect of an order of strike-out made by a judge of the District Court of New South Wales. Gleeson CJ said at page 6 of BC9404890, at page 3 of the computer print that I have:

The question whether the power to make that order was to be found in Pt18 r 3 or Pt26 r5B may not in the end be of great importance. However it seems to me that Pt26 r5B undoubtedly conferred upon Taylor DCJ the power to make the order which he made.

The expression "strike out" is one that appears in Rules of Court with somewhat varying meanings. It is, for example, an expression that is commonly used in relation to pleadings; and where so used it ordinarily involves the possibility of a fresh pleading being filed.

In the context of Pt26 of the District Court Rules r5B uses the expression "strike out" in a sense that appears to refer to removal of an action from a list of cases awaiting hearing. That impression is reinforced by the reference in subr(2) of r5B to the concept of reinstatement.

It is clear that when an order of striking out is made under r5B, the action does not stand dismissed but there us the potential for it to be reinstated by order of the Court and, as both parties to the present appeal recognise, that could have very important consequences if, as in the present case, a limitation period has expired in between the making of the order to strike the action out and the making of the order for reinstatement.

14 Similarly in Tanska v Transport Accident Commission [2000] VSC 56, Warren J (as the Chief Justice then was) at paragraph [16] of her judgment said:

The first mater to be considered is whether a proceeding once struck out can be reinstated. The striking out of a proceeding is a different matter to that where, for example, a proceeding is dismissed or a judgment is ordered. In the latter examples the matter has usually been determined on the merits and a disposition has occurred.

More recently Kaye J in R v McGowan & Anor [1984] VicRp 78; [1984] VR 1000 at 1004 adopted the approach that it is only possible to terminate an action by judgment or discontinuance but that an action which is struck out remains pending being a means convenient to the parties and the arrangements of court lists. On the basis of the authorities it was open, therefore, to the Master to order that the County Court proceeding be reinstated.

16 In my view the order which I made was made with precisely this intent. To adapt the words of Gleeson CJ in Anderson's case the proceeding was conveniently removed from the list of active matters but not finally disposed of. It was a matter of deliberate choice on my part to make the order one of strike out rather than dismissal to cater for a possibility such as the present. I have the power therefore to reinstate the proceeding if I am minded to do so, though the reinstatement is a matter of discretion.

17 In my view however, the sort of matters that are customarily considered with respect to Section 120 of the Victorian Civil and Administrative Tribunal Act are generally relevant matters to inform the exercise of the discretion which I find I had in present circumstances.

18 The first question I have to ask myself is whether I should accept the characterisation that Mr Bradd puts on these events, namely that he was the victim of incompetence on the part of the State Revenue Office and who knows what on the part of his solicitor. I am somewhat troubled by simply accepting that view of things. As Mr Kotros has observed, the letter to Mr Bradd on 8 February 2006 not only states that copies of documents have been forwarded to Andrew T. Fraser and Associates but states that proposition in bold letters. It includes a document noting that that law office has been nominated as Mr Bradd's address for service. What Andrew T. Fraser and Associates have done, if I accept Mr Bradd's account, is quite extraordinary. Receiving correspondence from this Tribunal threatening strike-out of a proceeding unless the filing fee is paid and then receiving an actual order of strike-out, this firm neither returned any of the correspondence with an explanation that it no longer acted nor forwarded these items to Mr Bradd. Presumably on this view, it simply dropped these items of correspondence in the rubbish or in the shredder.

19 When this application was listed, I asked a registry officer to make contact with Mr Bradd and tell him that I would be particularly interested to receive an explanation as to how these most unlikely events had occurred. Mr Bradd said that he deliberately omitted to make any enquiry of Andrew T. Fraser and Associates because he was apprehensive that he might be charged money for any information that would be furnished. All these matters I think leave me quite troubled as to whether in fact Mr Bradd is the victim of unfortunate circumstance as he would have it. However, for the purposes of the present application I am prepared to assume that he is in fact an innocent victim as he would suggest he is. Even with this established either finally or provisionally, it remains a matter of discretion as to whether the present application should be reinstated.

20 Mr Kotros said that if I come to the view that I have the power to reinstate this proceeding, I should not because the proceeding is inherently hopeless. He took me to the folder of documents which the Commissioner has filed to inform the determination of this proceeding and the statement of relevant facts. I did not understand the relevant facts as set out by the Commissioner to be disputed by Mr Bradd. According to those facts the home which in the present case was Unit 16, 24 Park Street, St Kilda, was the subject of a purchase contract not showing Mr Bradd as purchaser but rather showing 'Gnikam Yenom Pty Ltd and or nominee' as purchaser. The contract of sale was dated 12 April 2003. A transfer of land was in due course executed on 11 August 2003 whereby the vendor as transferor, Gnikam as transferee, executed a transfer of land showing the consideration of $275,000. That transfer attracted ad valorem stamp duty. Gnikam transferred the property to Mr Bradd on 24 May 2005 on the basis that Mr Bradd was entitled to equity. The parties had executed a trust deed which showed that Mr Bradd had furnished the purchase price, so he was a beneficiary of a resulting trust. In those circumstances this second transfer was adjudicated exempt from duty under Section 34 of the Duties Act 2000.

21 The requirements for successful First Home Owner Grant application under the First Home Owner Grant Act 2000 are somewhat elaborate and spread through a number of definitions and criteria. Section 7(1) of the Act provides:

A First Home Owner Grant is payable on an application under this Act if:

(a) The applicant or if there are two or more of them each of the applicants complies with the eligibility criteria at the time of the transaction for which the grant is sought is completed; and

(b) The transaction to which the grant is sought is an eligible transaction and has been completed.

22 I will turn to the eligibility criteria in a moment but 'eligible transaction' is a concept defined in Section 13(1). An eligible transaction for these purposes is a contract made on or after 1 July 2000 for the purchase of a home interstate. Sub-section (5) provides, sub-section (2)

Each of the following is subject to sub-section (3) a relevant interest in land:

An equitable interest is not a relevant interest unless it is the interest of a person under a legal disability with whom a guardian holds the interest of trust.

24 In the present case Mr Bradd as beneficiary under the trust until the on-transfer from 24 May 2005 held only in equitable interest in the property. It is difficult to see therefore that Mr Bradd could be a competent applicant for a grant under the First Home Owner Grant Act. In addition Section 15(1) of the Act provides that all interested persons must be applicants. Clearly the purchaser under the relevant contract, namely Gnikam Yenom Pty Ltd was an interested person and is not an applicant in the present circumstances. Whether or not had Mr Bradd and the trustee company joined in making an application, such application would have been successful I need not consider. The facts and the legal considerations that I have just described just indicate, as Mr Kotros contended, that this review application is doomed to failure, so I accept Mr Kotros' submission that even although I have power to reinstate this application and I accept at least for the purposes of the argument that Mr Bradd should be regarded as an innocent victim in these circumstances, nevertheless, as a matter of discretion the strike out should not be removed and the proceeding reinstated because the review application must necessarily fail.

Bradd v State Revenue Office

At a glance

Court

Decision date

Source

Judgment (32 paragraphs)

Bradd v State Revenue Office (Taxation) [2006] VCAT 867 (5 May 2006)

Parties