Commissioner of Taxation v Seymour

Category: Catchwords

Counsel for the Applicant: Mr D McGovern SC with Ms R Graycar

Solicitor for the Applicant: Australian Government Solicitor

Counsel for the First and Second Respondents: Mr J Hyde Page with Mr B J Symons

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1235 of 2014

JUDGE: BUCHANAN J DATE OF ORDER: 7 April 2015 WHERE MADE: SYDNEY

1. A writ of certiorari issue quashing the decision of the Administrative Appeals Tribunal made on 27 October 2014.
2. The first and second respondents pay the applicant's costs as taxed if not agreed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1235 of 2014

JUDGE: BUCHANAN J DATE: 7 April 2015 PLACE: SYDNEY

The present application 1 This is an application under s 39B of the Judiciary Act 1903 (Cth) for prerogative relief against the Administrative Appeals Tribunal ("the AAT") established under the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act"), on the grounds that it committed jurisdictional error. 2 The decision made by the AAT was that it would permit the first and second respondents ("the taxpayers") to give evidence by video link from Mauritius in proceedings commenced by them in the AAT. The AAT proceedings concern objections to notices of assessment of income tax issued against each of the respondents by the applicant ("the Commissioner").

The proceedings in the AAT 3 In around May 2012, the taxpayers each received notices of amended assessment of income tax, including penalties, of approximately AUD$1 million. In around September 2013, the first respondent received a notice of further amended assessment of income tax of over AUD$7 million. The assessments cover the period for the income tax years ending 30 June 2001 to 30 June 2010. 4 The taxpayers lodged objections. With one (presently irrelevant) exception the objections were refused. The taxpayers then each commenced proceedings in the AAT seeking review of the objection decisions by the Commissioner. The various applications which they have made to the AAT, which give rise to the current proceedings in the AAT, are as follows: • Application filed by John Seymour on 22 January 2013 numbered 2013/0287-0296 seeking review of an objection decision made by the Commissioner on 20 December 2012; • Application filed by Jeanette Seymour on 21 August 2013 numbered 2013/4168-4177 seeking review of an objection decision made by the Commissioner on 28 June 2013; and • Application filed by John Seymour on 15 April 2014 numbered 2014/1853-1859 seeking review of an objection decision made by the Commissioner on 4 April 2014. 5 The taxpayers have resided in Mauritius, they say, since 19 January 2013 having relocated there from Australia. On 7 February 2014, the taxpayers' counsel made representations to the AAT about the proceedings then on foot (AAT 2013/0287-0296, AAT 2013/4168-4177) which included the following: Both Applicants live outside Australia. The Applicants wish to apply for case management directions whereby they can give evidence by video-link, telephone, or alternatively at an evidentiary hearing outside Australia. To that end the Applicants have sought the Respondent's consent to the appropriate directions, but we have received no response. As the Applicants live in Mauritius, the AAT's attitude to how the Applicant's evidence will be taken is very relevant to the case management of these proceedings. The Applicants respectfully request an interlocutory hearing for the purpose of making this application. 6 Shortly thereafter, the taxpayers filed (amongst other evidence) affidavits made by each of them, also dated 7 February 2014, setting out the reasons why they did not want to give evidence in Australia. I shall refer to the reasons in due course. 7 On 7 August 2014, the AAT directed the parties to exchange correspondence about any request by the taxpayers to know the position of the Commissioner about the possible issue of a Departure Prohibition Order ("DPO") to either of them if they re-entered Australia. Possible service of a DPO was amongst the matters mentioned by the taxpayers in their affidavits. 8 The parties exchanged correspondence, inconclusively. At the same time, the Commissioner advised that the taxpayers and some other (but not all) witnesses to be relied upon by them would be required for cross-examination. The Commissioner agreed that some witnesses not residing in Australia (but not the taxpayers) could give their evidence by video link. 9 The AAT then advised the solicitors acting for the Commissioner that, when the interlocutory application to take evidence of the taxpayers was heard, it wished the "decision makers" to be available by telephone to answer questions from the AAT: why they were not prepared to consider the giving of undertakings to the Applicants [about DPOs and other matters] given that the Commissioner does provide such undertakings in other cases. 10 The AAT was advised that the Commissioner did not propose to comply with that request. 11 The interlocutory application was heard on 24 September 2014. On 27 October 2014, the AAT issued a written decision (supported by reasons) that: Leave to give oral evidence by video link at the hearing of these proceedings is granted to the Applicants. 12 I shall return in due course to the reasons given by the taxpayers for wishing to give evidence by video link (which were expressed, in part, simply as a refusal to come to Australia), the correspondence between the parties and the reasons of the AAT. 13 Before that, something should be said about the procedural power being exercised by the AAT.

Procedural powers 14 The AAT Act provides, by s 33(1): 33 Procedure of Tribunal (1) In a proceeding before the Tribunal: (a) the procedure of the Tribunal is, subject to this Act and the regulations and to any other enactment, within the discretion of the Tribunal; (b) 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; and (c) the Tribunal is not bound by the rules of evidence but may inform itself on any matter in such manner as it thinks appropriate. 15 By s 35A(1), it is provided: 35A Participation by telephone etc. (1) A person holding a directions hearing and the Tribunal in the hearing of a proceeding may allow a person to participate by: (a) telephone; or (b) closed-circuit television; or (c) any other means of communication. 16 It is accepted that the concept of participation by a person extends to permitting evidence to be given by video link, including from another country. 17 Section 39(1) provides: 39 Opportunity to make submissions concerning evidence (1) Subject to sections 35, 36 and 36B, the Tribunal shall ensure that every party to a proceeding before the Tribunal is given a reasonable opportunity to present his or her case and, in particular, to inspect any documents to which the Tribunal proposes to have regard in reaching a decision in the proceeding and to make submissions in relation to those documents. (None of the specific sections mentioned in s 39(1) is here relevant). 18 The present proceedings involve consideration of the exercise of the discretion in s 35A(1), informed by the provisions of s 33(1), bearing in mind the requirements of s 39(1). 19 It is convenient now to identify the particular challenges made to the AAT's decision, before I turn to the material which was before the AAT and then to its reasons.

The grounds of the application 20 Four of the grounds allege "improper exercise of power" in relation to s 35A of the AAT Act. The particular allegations are: (a) misconstruing s 35A (Ground 1); (b) taking into account irrelevant considerations (Ground 3); (c) failing to take relevant considerations into account (Ground 4); (d) improper exercise of power under s 35A because the exercise of power was unreasonable, irrational or illogical (Ground 7). 21 The remaining three grounds allege: (e) breach of s 39 of the AAT Act amounting to denial of procedural fairness (Ground 2); (f) no evidence to support the decision (Ground 5); (g) failure to provide reasons as required by s 43(2) and s 43(2B) of the AAT Act (Ground 6).

Material before the AAT 22 In their affidavits dated 7 February 2014, each of the taxpayers referred to being a client of an accountant, Mr Vanda Gould, to whom they had entrusted management of their tax affairs. They referred to learning that Mr Gould had himself been arrested at one time and charged with defrauding the Commonwealth and using money as an instrument of crime. 23 Each referred to their ongoing dispute with the Australian Taxation Office ("the ATO"). Each said: My difficulties with the ATO have caused me to think that if I am physically present on Australian territory for any period of time I will either be arrested or prevented from leaving, possibly for many years. For this reason I am not prepared to come to Australia for the purposes of being cross-examined or giving oral evidence in these proceedings, or for any other reason. 24 It should be noted that, at this point, the position taken by the taxpayers was effectively unequivocal: they were not prepared to come to Australia for fear of arrest or being prevented from leaving. However, other matters were then referred to and each of the taxpayers said: For the reasons I outline above I am not prepared to physically come to Australia for any reason, unless at least one of several different conditions is satisfied. I would be prepared to come to Australia if the ATO substantially abandons its claims about the taxes and penalties I owe for the 2000-2010 income years, or if these liabilities are overturned by a court or tribunal. I would come to Australia if I was given a written assurance or agreement that I will not be prevented from leaving Australia by the government, or arrested for alleged tax crimes while in Australia. I would also need to receive independent legal advice that any such assurance or agreement is legally binding on all relevant government agencies and bodies. I would be prepared to come to Australia if I was given legal advice that it was not possible for me to be prosecuted for a crime that carries a possible custodial sentence. I do not personally have any expectation about what the impact on my AAT appeal would be, if I refuse to come to Australia for the purposes of cross-examination. My view about remaining outside Australia is sufficiently strong that I would not come to Australia even if assured it was a certainty that my AAT appeal would be unsuccessful due to my absence. I do not believe I have done anything wrong, or criminal, in connection with my tax matters or in any other respect. However I do not regard ultimate vindication by the courts or AAT as a sufficient reason to come to Australia if this means I could be submitting myself to a costly struggle, away from my home, that would potentially last for years. I do not want to expose myself to any possibility of a criminal offence charge at this late stage of life. [The second respondent also said that she had never previously been charged with a criminal offence]. Alternative arrangements for giving evidence For the purposes of giving evidence, either by video-link or at a physical location outside Australia, I would be prepared to personally incur the expense of travelling to any other country other than Australia. However I would need to seek advice about what my legal position would be, depending on which country it was proposed I give evidence in. 25 Those later statements of preparedness to come to Australia were conditioned on satisfaction of at least one of a number of conditions: abandonment or rejection of the claims against each of the respondents; written assurances, binding on the Australian government and supported by legal advice that arrest or restraint on departure would not, and could not, occur; or legal advice that there was no possibility of a custodial sentence. Some of those conditions are mutually exclusive, and some have patently not been satisfied. For example, the claims by the ATO have been neither abandoned nor rejected by a court or tribunal. It must be inferred also that the taxpayers have not received legal advice that it was not possible to be prosecuted for a crime carrying a possible custodial sentence. 26 The statement of the taxpayers' position which was before the AAT in those affidavits, therefore, amounted to an ultimatum that the taxpayers would not come to Australia, whatever the consequence for the proceedings they had initiated before the AAT, unless at least two stipulations were satisfied: a binding assurance of no restraint on departure and a binding assurance of no arrest. 27 Those two interrelated requirements involve different considerations. The first may also involve more than one element. 28 Section 14S(1) of the Taxation Administration Act 1953 (Cth) gives the Commissioner an administrative discretion in the following terms: 14S Departure prohibition orders (1) Where: (a) a person is subject to a tax liability; and (b) the Commissioner believes on reasonable grounds that it is desirable to do so for the purpose of ensuring that the person does not depart from Australia for a foreign country without: (i) wholly discharging the tax liability; or (ii) making arrangements satisfactory to the Commissioner for the tax liability to be wholly discharged; the Commissioner may, by order in accordance with the prescribed form, prohibit the departure of the person from Australia for a foreign country. 29 Section 14T(2) provides: 14T Revocation and variation of departure prohibition orders … (2) Where a departure prohibition order is in force in respect of a person, the Commissioner may, in the Commissioner's discretion and on application being made to the Commissioner to do so or on the Commissioner's own motion, revoke or vary the departure prohibition order. 30 Section 14V(1) and s 14X provide: 14V Appeals to courts against making of departure prohibition orders (1) A person aggrieved by the making of a departure prohibition order may appeal to the Federal Court of Australia or the Supreme Court of a State or Territory against the making of the departure prohibition order. 14X Orders of court on appeal A court hearing an appeal under section 14V against the making of a departure prohibition order may, in its discretion: (a) make an order setting aside the departure prohibition order; or (b) dismiss the appeal. 31 It is not unimportant to identify two aspects of this arrangement. First, the issue of a DPO is within the administrative discretion of the Commissioner. Secondly, the exercise of the discretion is reviewable by a court. 32 So far as DPOs specifically are concerned, the Commissioner has been prepared in the past to give an assurance to facilitate travel to Australia by a respondent (who may not have been an Australian citizen) to proceedings for a civil penalty commenced by the Commissioner (Commissioner of Taxation v Arnold [2014] FCA 959). An application to give video evidence was refused in that case but it should be noted that there was no suggestion in the judgment in that case that failure to provide the undertaking would necessarily have produced a different outcome. 33 It might also be noted that the conditions stated by the taxpayers in the present case were not related specifically to the possibility of a DPO being issued by the Commissioner, but referred more generally to being "prevented from leaving Australia by the government" in the context, also, of fearing arrest on criminal charges. 34 In the correspondence on their behalf, pursuant to the directions made by the AAT on 7 August 2014, solicitors for the taxpayers sought "a written undertaking to the AAT" by the Commissioner in the following terms: The Commissioner of Taxation undertakes that if Mr John Washington York Seymour and Jeanette Marie Louise Seymour physically travel to Australia for the purpose of giving evidence as witnesses in AAT proceedings (specifically AAT 2013/4168 - 4177, 2013/0287 - 0296, 2014/1853 - 1859) the Commissioner of Taxation (including his employees, officers, agents and ancillaries) will not take advantage of the presence of either witness by: I. Issuing a departure prohibition order to either witness, or otherwise preventing either witness from leaving Australia; II. Serving either witness with court or other process (except process that is properly incidental to AAT 2013/4168 - 4177, 2013/0287 - 0296, AAT 2014/1853 - 1859); III. Initiating or procuring criminal charges against either witness in connection with tax offences allegedly committed by either witness during the time either witness is in Australia; IV. Taking to steps to implement or procure the arrest or physical detention of either witness in connection with criminal charges or future criminal charges based on tax offences allegedly committed by either witness or involving either witness. The Commissioner of Taxation gives the Administrative Appeals Tribunal a further undertaking that he (including his employees, officers, agents and ancillaries) will not communicate with other Commonwealth or State government agencies, or to any country with which Australia has an extradition treaty or similar agreement, about the current AAT proceedings, and in particular the evidence to be given by the John Seymour and Jeanette Seymour, in a way that may have the effect of undermining the other undertakings given by the Commissioner of Taxation to the Administrative Appeals Tribunal. The Commissioner of Taxation gives the Administrative Appeals Tribunal a further undertaking that he will provide the Applicants with a sworn affidavit identifying the other government agencies that have been involved in any investigation of John Seymour and Jeanette Seymour, as well as the relevant persons at these agencies with an involvement in such investigations. The Commissioner of Taxation gives the Administrative Appeals Tribunal an undertaking that he (including his employees, officers, agents and ancillaries) will not communicate with other Commonwealth or State government agencies about the arrival of the Seymours in Australia. For the avoidance of doubt these undertakings continue to have force and effect until such time as John Seymour and Jeanette Seymour have completed their evidence in the AAT proceedings and completed the journey back to their country of residence. In the event that John Seymour and/or Jeanette Seymour has not departed Australia within one week (that is, seven full days) of completing their evidence in the AAT proceedings the Commissioner of Taxation may apply to the Administrative Appeals Tribunal to be released from these undertakings. 35 Only the very first of those stipulations related to DPOs. The rest were extremely broad. 36 The Commissioner took the view that it would be inappropriate to give an undertaking in the terms sought, whether with respect to DPOs or otherwise. The letter communicating that position included: 2. The undertakings sought in that letter are very broad and in our view go well beyond those that would be appropriate for the Commissioner to consider. In particular, we believe that it would be inappropriate for the Commissioner to agree not to communicate with other government agencies and to disclose names of persons in other agencies who may be involved in investigations. As you are aware, these proceedings arise out of an Operation Wickenby investigation involving many agencies and our client has reporting obligations in that regard. 3. Further, the Commissioner does not have the discretion to provide undertakings with respect to the exercise of powers available to other Commonwealth or State government agencies. … 11. In conclusion, the terms of the undertaking requested in your letter have been carefully considered. The Commissioner of Taxation will not provide an undertaking not to issue a departure prohibition order to Mr John Seymour and Mrs Jeannette Seymour. Further, the Commissioner does not consider that he has the discretion to provide undertakings in respect of the exercise of power of other Commonwealth and State government agencies. 37 The terms of the undertaking sought went beyond the matters referred to in the affidavits filed by the taxpayers. When those terms were not accepted by the Commissioner the position of the taxpayers must, in my view, be understood to be as they had indicated in their affidavits.

The reasons of the AAT 38 The reasons of the AAT, and the explanation given for the decision which it made on 27 October 2014, concentrate in large measure upon the possibility that the Commissioner may have been prepared to give an undertaking not to issue DPOs but would not do so. Thus, the AAT stated at the outset: 3. The Overseas Applicants do not wish to come to Australia to give oral evidence because, amongst other concerns, they fear that if they do so they may then be prohibited from leaving Australia if the Commissioner decides to issue departure prohibition orders (DPOs) pursuant to s 14S of the Taxation Administration Act 1953 (TAA). The Commissioner declined to give any undertakings to them that he would not issue DPOs. 39 Thereafter, the AAT set out the background, including reference to the taxpayers' affidavits and the correspondence to which I have referred. The AAT referred (directly or indirectly) to cases in this Court discussing the circumstances in which evidence by video link might be permitted pursuant to s 47A(1) of the Federal Court of Australia Act 1976 (Cth) ("the FCA Act"), specifically Australian Competition and Consumer Commission v Pirovic Enterprises Pty Ltd [2014] FCA 544 ("Pirovic Enterprises"), where Flick J referred to a number of earlier authorities. 40 The AAT's conclusions were expressed as follows: SHOULD THE APPLICANTS BE ALLOWED TO GIVE EVIDENCE BY VIDEO LINK? 27. In balancing the competing considerations and determining what is fair and just to the parties, I have decided that [the taxpayers] should be given a reasonable opportunity to present their cases and that permitting them to give oral evidence by video link is an appropriate course. In that way, the Commissioner will also be afforded procedural fairness as he will have a reasonable opportunity to test the cogency of their written statements. Section 39 of the AAT Act requires the Tribunal to ensure that every party to a proceeding before the Tribunal is given a reasonable opportunity to present his or her case. 28. I have taken into account in reaching my decision that the only basis relied upon by [the taxpayers] for seeking to give their evidence by video link or overseas is because they fear, amongst the possible consequences of them coming to Australia, the Commissioner may issue them with DPOs prohibiting them from leaving Australia. This consideration is similar to that referred to by Flick J at [12] in Pirovic, namely, "an inability to freely travel to and depart from Australia". It is similar because [the taxpayers'] fear that they will be in that situation. But their fears are, in my view, real and rational, for the reasons explained in their affidavits (see [14] and [16] above), as well as because the Commissioner did not proffer any undertaking not to issue DPOs. Their fear of being issued with DPOs is a very significant consideration for the exercise of the discretion because DPOs represent "a serious intrusion on a person's freedom of movement": Pattenden v Commissioner of Taxation [2008] FCA 1590, per Logan J. These fears are in my view well founded, unlike in Re Murray and Commissioner of Taxation [2011] AATA 837 where Deputy President Hack was not satisfied of Mr Murray's beliefs (see [12]-[17]). 29. Mr McGovern said that there is nothing in the material that is before the Tribunal to indicate that any decision with respect to DPOs has yet been made and, further, that it would be premature for the Commissioner to make any such decision given the particular statutory framework that governs the making of DPOs. Furthermore, he also submitted that it would clearly be an impermissible and irrelevant consideration for the Tribunal to take into account the refusal of the Commissioner to undertake, in effect, to fetter or impose an advanced constraint upon one of his statutory powers. 30. While it may be accepted, as submitted by Mr McGovern, that the Commissioner has not made any decision as yet as to the issue of any DPOs, the Commissioner's decision to decline to offer any undertakings with respect to the possible issue of DPOs lends credence to the fears of [the taxpayers]. It also adds to the uncertainty and their vulnerability, especially when it is recalled that the Commissioner does give undertakings that he will not issue DPOs in other cases. The case of Commissioner of Taxation v Arnold [2014] FCA 959, where Edmonds J rejected an application by Mr Arnold to give his evidence by video link, is directly on point. In that case, Edmonds J noted that the factors there pointed "strongly in the direction that Mr Arnold's application should be refused". Significantly, however, his Honour commented that the only matter that caused him "some concern" was the possibility that Mr Arnold might be restrained from leaving Australia were he to come here to give evidence, but that concern was alleviated by the Commissioner proffering an undertaking in relation to not issuing a DPO (see [21]). As already noted, no such undertaking was proffered by the Commissioner to [the taxpayers]. 31. I have also taken into account s 33(1)(c) of the AAT Act, which relevantly provides that the Tribunal "is not bound by the rules of evidence". In this regard, I note that [the taxpayers] have filed with the Tribunal a number of affidavits and written statements for the hearing. I consider that the taking of their oral evidence, albeit by video link, will be preferable to the pre-prepared written material on its own as there is spontaneity. 32. Furthermore, it appears that several issues in the proceedings are likely to be about the legal efficacy of the arrangements under the provisions of the taxation laws in part due to the role apparently played by Vanda Gould as the former accountant. It follows that while [the taxpayers] are important and their credit may be put in issue (as is also acknowledged by Mr Hyde Page), it is unlikely that their evidence will necessarily be determinative. Consequently, I also do not consider that cross examination by the Commissioner will be impeded. 33. Finally, it must also be borne in mind that [the taxpayers] … bear the burden of proving that the assessments are excessive: s 14ZZK of the TAA. They should not be deprived of the opportunity to give oral evidence. (Emphasis in original.) 41 With respect to the AAT, it does not seem to me to be correct to say (as the AAT did in [28]) that the only basis relied on was fear of DPOs. The statement is confused by the reference to that being "amongst the possible consequences" but it seems to me that, read with appropriate consideration and tolerance for any infelicity of language, what the AAT was identifying was a single point of resistance from the taxpayers, coupled with an inflexible position by the Commissioner. The reasoning of the AAT may, therefore, have proceeded upon an unstated assumption that an undertaking not to issue DPOs would have been met with willingness to travel to Australia. 42 In my respectful view, there was no adequate basis for such an assumption, if it was made. If it was not made, the consequence must be that the AAT failed to deal with the real reasons (or a large part of the real reasons) why the taxpayers had announced that they would not travel to Australia. 43 Mr Hyde Page, in his oral submissions on the present application, accepted that there was no reason to think that, if the Commissioner had given an assurance not to issue DPOs, the taxpayers would have agreed to come to Australia to give evidence. He submitted that the effect of the AAT's reasoning was that it was better to have the taxpayers' evidence by video link than to have no oral evidence from them at all. He referred in particular to [31]. 44 I am not able to read the AAT's reasons that way. In my view, the effect of the AAT's reasoning was that, in refusing to come to Australia to give oral evidence, the taxpayers were justified by a well-founded fear of being prevented from leaving Australia, to which the Commissioner had contributed. Taking the evidence by video link was justified and appropriate because, otherwise, the taxpayers would be "deprived" of an opportunity of giving oral evidence. 45 I shall deal with this reasoning in due course. 46 However, this is not just a case about error, or even legal error. The Commissioner must show that there has been a jurisdictional error, bearing in mind the discretionary and interlocutory character of the decision which is challenged.

Interlocutory jurisdictional error 47 The basic test for the identification of jurisdictional error by an administrative tribunal was stated in Craig v South Australia (1995) 184 CLR 163 in the following way (at 179): If … an administrative tribunal falls into an error of law which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error which will invalidate any order or decision of the tribunal which reflects it. (Emphasis added.) 48 The necessity for the exercise of power to be affected should be noted. A similar point was made in Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 where McHugh, Gummow and Hayne JJ (with whom Gleeson CJ agreed) referred to the passage from Craig set out above and said (at [82]): 82 … What is important, however, is that identifying a wrong issue, asking a wrong question, ignoring relevant material or relying on irrelevant material in a way that affects the exercise of power is to make an error of law. Further, doing so results in the decision-maker exceeding the authority or powers given by the relevant statute. In other words, if an error of those types is made, the decision-maker did not have authority to make the decision that was made; he or she did not have jurisdiction to make it. … (Emphasis added.) 49 In SAAP v Minister for Immigration & Multicultural & Indigenous Affairs (2005) 228 CLR 294, McHugh J identified the issue for examination as follows (at [72]): 72 Jurisdictional error may arise where a decision-maker fails to discharge "imperative duties" or to observe "inviolable limitations or restraints" found in the Act. To determine whether a decision under the Act involves a jurisdictional error, it is necessary to take two steps. First, it is necessary to determine the limitations and restraints found in the Act. Secondly, it is necessary to attempt, through statutory construction, to reconcile them with s 474 of the Act to ascertain whether failure to observe any particular procedural or other requirement in the Act constitutes an error which has resulted in the decision-maker failing to exercise or exceeding its jurisdiction. (Emphasis added.) (Footnote omitted.) 50 Those various observations, and the test they reflect, are more easily applied to legal errors which affect the exercise of some final authority or decision-making power. They are less easily applied at any interlocutory stage. 51 The recent clarification by the High Court of the law relating to legal unreasonability in Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 concerned, at one level, a final decision by the Migration Review Tribunal ("the MRT"). But at another level it concerned the reasonableness of a refusal to grant an adjournment which might have made the vital difference between success and failure for a visa applicant, and therefore fundamentally affect whether the visa applicant might be granted a right to remain in Australia. French CJ said (at [31]): 31 The decision of the MRT to proceed to its determination was not, on the face of it, informed by any consideration other than the asserted sufficiency of the opportunities provided to the first respondent to put her case. The MRT did not in terms or by implication accept or reject the substance of the reasons for a deferment put to it by the first respondent's migration agent. It did not suggest that the first respondent's request for a deferment was due to any fault on her part or on the part of her migration agent. It did not suggest that its decision was based on any balancing of the legislative objectives set out in s 353. Its decision was fatal to the first respondent's application. There was in the circumstances, including the already long history of the matter, an arbitrariness about the decision, which rendered it unreasonable in the limiting sense explained above. 52 Hayne, Kiefel and Bell JJ concluded that the MRT did not conduct the review before it "in the manner" required and that the MRT "consequently acted beyond its jurisdiction". This appears to comfortably accommodate the possibility of interlocutory jurisdictional error. 53 Apart from questions of unreasonableness, it has long been established that denial of procedural fairness (a category of legal and jurisdictional error not referred to in the passage from Craig set out above) may justify prerogative relief at an interlocutory stage. 54 The cases to which I refer next concerned the writ of prohibition, but I see no reason in principle why the passages to which I will refer would not apply to the writ of certiorari, followed, if necessary, by a writ of mandamus (as was sought in the present proceedings) to command further attention to the case at hand. 55 In R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Company Proprietary Limited (1953) 88 CLR 100, a writ of prohibition was sought against a delegate of the Australian Stevedoring Industry Board who was conducting an inquiry under the Stevedoring Industry Act 1949 (Cth). An allegation of apparent bias was dismissed by the High Court. Then the Court dealt with an argument that prohibition should lie in any event, and upheld it. The reasons for that conclusion are important. Dixon CJ, Williams, Webb and Fullagar JJ said (at 117-118): … There can be no foundation for a writ of prohibition unless and until it appears, whether from the course of the inquiry or from the preliminary statement of the matters to which the inquiry is directed, that there can be no basis for the exercise of the power conferred by s. 23 (1) or that an erroneous test of the liability of the employer to the cancellation or suspension of his registration will be applied or that some abuse of authority is likely. In any such case a writ of prohibition may lie but it must be a writ restraining the ordering of cancellation or suspension. If on the facts no basis could exist for exercising the power it would be a proper exercise of this Court's jurisdiction to award a writ of prohibition prohibiting unconditionally or peremptorily the cancellation or suspension threatened. and (at 118-119): … subject to certain limitations not here material, while prohibition is not a writ of course, it is a writ which goes as of right when the prosecutor is directly affected by the course pursued by a tribunal to which the writ lies and the prosecutor shows satisfactorily that the tribunal is about to act to his detriment in excess of its authority. 56 It was an important element of this analysis that there was no real possibility of an outcome against the interests of the prosecutor which would be jurisdictionally sound, so that any further conduct of the challenged inquiry was inappropriate. 57 In Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82, Gaudron and Gummow JJ (with whom Gleeson CJ agreed) said (at [41]): 41 It follows that, if an officer of the Commonwealth exercising power conferred by statute does not accord procedural fairness and if that statute has not, on its proper construction, relevantly (and validly) limited or extinguished any obligation to accord procedural fairness, the officer exceeds jurisdiction in a sense necessary to attract prohibition under s 75(v) of the Constitution. and (at [59]): 59 However, the conditioning of a statutory power so as to require the provision of procedural fairness has, as its basis, a rationale which differs from that which generally underpins the doctrine of excess of power or jurisdiction. The concern is with observance of fair decision-making procedures rather than with the character of the decision which emerges from the observance of those procedures. Unless the limitation ordinarily implied on the statutory power is to be rewritten as denying jurisdictional error for "trivial" breaches of the requirements of procedural fairness, the bearing of the breach upon the ultimate decision should not itself determine whether prohibition under s 75(v) should go. The issue always is whether or not there has been a breach of the obligation to accord procedural fairness and, if so, there will have been jurisdictional error for the purposes of s 75(v). 58 On the present application, Mr Hyde Page submitted that a denial of procedural fairness will generally not justify intervention at an interlocutory stage. He relied on judgments in this Court by Murphy J (Frugtniet v Tax Practitioners Board (2013) 136 ALD 324 at [36]) and North J (VAI v Deputy President Forgie of the Administrative Appeals Tribunal and Federal Commissioner of Taxation (2003) 52 ATR 49 at [37]), but neither judgment or reference assists him. In each case, a denial of procedural fairness was not sufficiently established at an interlocutory stage. By contrast, in Australian Postal Commission v Hayes (1989) 23 FCR 320 ("Hayes"), Wilcox J said (at 323): … the Court ought not to deny relief upon the merits in a case where a question of substance arises, which may be important in the disposal of the principal proceedings, particularly where the effect of refusing relief will be irreversible. … 59 The question which his Honour was addressing was whether a direction by the AAT would unreasonably interfere with cross-examination. The headnote of the report of the case records: In proceedings before the Administrative Appeals Tribunal there was an issue between the parties as to the extent of injuries suffered by B, the second respondent. Counsel for the Commission desired to confront B in cross-examination with film of her activities which was taken in the period during which she was alleged to have been suffering from the injuries. The tribunal directed that the film be shown to B at the commencement of her evidence in chief. Held: The direction given by the Tribunal denied to the Commission procedural fairness because it so fettered the proposed cross-examination of B that her evidence could not properly be tested. 60 The case is, so far as it concerns procedurally unfair interference with normal rights of cross-examination, an analogue in some senses with the present case, as I shall mention. 61 The cases make it clear, in my respectful view, that a court will not decline to intervene in a proven case of denial of procedural fairness at an interlocutory stage, but the requirement for a sufficiently clear case is no small obstacle. 62 I shall give closer attention to those matters when I deal with the particular complaints made by the Commissioner. 63 However, there is one further matter with which I should deal here. Mr Hyde Page submitted that any error made by the AAT in the present case was not capable of being regarded as jurisdictional error. He relied on a judgment of the Western Australian Court of Appeal in Re State Administrative Tribunal; Ex parte McCourt (2007) 34 WAR 342 ("McCourt") at [52]: 52 Where the decision-maker is a court or anomalous tribunal, misconstruing a statute, identifying the wrong issue, asking the wrong question, taking into account irrelevant considerations or failing to take into account relevant considerations do not ordinarily involve jurisdictional error: Craig (at 179-180). Insofar as relevant and irrelevant considerations are concerned, they only relate to jurisdiction if the matters to be taken into account or ignored are a precondition of the existence of any authority to make an order or decision in the circumstances of the case: Craig (at 177-180). We are not persuaded that the considerations now relied on by the applicant can be so characterised. 64 This passage proceeds from a conclusion that the State Administrative Tribunal, constituted under the State Administrative Tribunal Act 2004 (WA) was an "anomalous tribunal", adopting conclusions in Re Carey; Ex parte Exclude Holdings Pty Ltd (2006) 32 WAR 501. The reference to the State Administrative Tribunal as an "anomalous tribunal" was intended, no doubt, to distinguish it from ordinary administrative tribunals. Anomalous courts and tribunals were expressly excluded from the discussion in Craig (see at 176-177). The AAT is not an anomalous tribunal. The reasoning in Craig, and the "critical distinction" which is introduced in Craig at 179 between inferior courts and administrative tribunals, is directly applicable. McCourt has no application.

Video link evidence 65 There has been some debate in this Court about the approach to be taken to applications to adduce evidence by video link, whether from within Australia or from overseas. I referred to the debate, and expressed my own views in Campaign Master (UK) Ltd v Forty Two International Pty Ltd (No 3) (2009) 181 FCR 152 ("Campaign Master"), particularly at [77]-[78]. 66 Particular considerations arise when it is proposed that a witness give evidence from another country. Those considerations may include questions about the quality of the video link and also the circumstances in which the witness will give evidence from the other country. In this Court some of those matters are addressed by s 47C of the FCA Act which imposes a number of requirements to be met (and permits the Federal Court Rules to do so also) to ensure, so far as possible, the integrity of the process. Those safeguards are not in place in the AAT Act, but they are important ones. 67 Generally, however, the matter of most central concern is the question of what is necessary to ensure fairness between the parties. Flick J referred to it in Pirovic Enterprises when he said (at [11]): 11 … The overriding consideration must, however, forever remain what is considered by the Court to be in the best interests in the administration of justice, including the need to ensure that justice is done as between the parties. (see also Kirby v Centro Properties Ltd (2012) 288 ALR 601 per Gordon J at [11]). 68 One issue, in that regard, concerns the efficacy of cross-examination of an unco-operative witness. Apart from the general considerations to which I referred in Campaign Master at [78] (see also Stuke v ROST Capital Group Pty Ltd (2012) 207 FCR 86 per Katzmann J at [28]-]32]), a witness, even a party, giving evidence from outside Australia is in no way compellable in any practical sense. As the Full Court observed in Joyce v Sunland Waterfront (BVI) Ltd (2011) 195 FCR 213 (at [65]): 65 Finally, the receipt of evidence by video link from a witness in another country depends upon the witness's willingness to give such evidence. Obviously, he or she can withdraw from the process at any time. It is unlikely that a party would do so. Where the witness is a party, the Court might well draw adverse inferences from any such withdrawal. At least in practice, the Court will not be able to compel a witness to answer. 69 Those are, for the most part, discretionary considerations. The discretion available to the AAT under s 35A of the AAT Act is not in doubt. To the extent, also, that the matters discussed in the various cases in this Court about the operation of s 47A of the FCA Act are relevant, consideration of them must be moulded to the legitimate procedures and processes followed by the AAT, bearing in mind the less formal procedures contemplated by s 33(1) of the AAT Act, and the fact that the AAT is not a court. 70 Nevertheless, the AAT must always bear in mind and observe s 39 of the AAT Act, and the more general requirements of procedural fairness and it must avoid jurisdictional error as discussed in Craig. 71 I will need to return to the question of discretionary considerations to deal with a reference to a case sent by counsel for the taxpayers, without objection, after argument had been taken and judgment reserved.

The challenges to the AAT decision 72 In respect of many matters I may state my conclusions fairly briefly because I have come to the view that the AAT fell into jurisdictional error in two particular, and interrelated, respects. 73 First, in the circumstances of the present case, it was a jurisdictional error (i.e. an error of law which affected the exercise of power) for the AAT to take into account, or give any weight to, the refusal of the taxpayers to come to Australia if they did not receive an assurance that a DPO would not be issued by the Commissioner to prevent, or delay, them from leaving immediately. As will be seen, consideration of that issue will require some reference to the wider context. It is clear that the taxpayers would not have come to Australia even if such an assurance had been given. I am not to be taken as suggesting that consideration of the possibility that a DPO might be issued is necessarily, and in every case, an irrelevant matter. It all depends on the circumstances. But it was not relevant in the present case. 74 Secondly, the further consequence of the jurisdictional error I have mentioned is that the AAT denied to the Commissioner a reasonable opportunity to present his case by removing the opportunity for effective cross-examination. That was a denial of procedural fairness in a general sense and would also represent a failure to conduct the proceedings in accordance with s 39 of the AAT Act. 75 I shall discuss those matters further as I address the particular challenges made by the Commissioner to the AAT decision and indicate why I do not accept them. 76 I propose to deal first with the particular challenges based on, or arising from, s 35A of the AAT Act. I will then address the other remaining grounds raised by the Commissioner's application for judicial review.

Grounds based on s 35A of the AAT Act 77 I see no basis for the suggestion in Ground 1 that the AAT "misconstrued" s 35A of the AAT Act, although there may be a separate argument that s 35A was misapplied. Section 35A gives a general discretion. The AAT understood that, and that the discretion was required to be exercised in conformity with s 39 of the AAT Act. The discussion in cases in this Court about when evidence might appropriately be taken by video link neither "governs" outcomes in this Court (contrary to the Commissioner's submissions) nor in the AAT. Those cases illustrate and explain the approach taken by various judges to the particular cases before them. The attempt to achieve consistency of application does not represent the adoption (much less the imposition) of a rule. 78 Although the Commissioner argued that those cases imposed an onus on a party wishing to adduce evidence by video link, it is clear (subject to matters yet to be discussed) that the AAT felt that the taxpayers had made out a proper case for the exercise of a discretion in their favour. 79 Ground 3 alleges that irrelevant considerations were taken into account, namely that the Commissioner would not bind himself with an undertaking. Such a consideration was not necessarily irrelevant. It appears to have been relevant (although not necessarily decisive) in Arnold that the Commissioner would give such an undertaking. However, as I have already said, it was not relevant in the present case. I shall discuss that further. 80 Ground 4 alleges a failure to take into account relevant considerations. The Commissioner's written submissions correctly accept that this ground can only warrant consideration if there was a failure to take into account mandatory relevant considerations. The matters referred to by the Commissioner concern the forensic disadvantage to the Commissioner which appears to have been dismissed as overstated by the AAT at [32]. 81 I see no objective basis at all for a conclusion by the AAT that cross-examination by the Commissioner would not be impeded. It was inevitable that the Commissioner's ability to cross-examine (about matters in issue, credit and more generally) would be impeded, perhaps seriously. That is one of the things which it was necessary to assess. I accept the Commissioner's submission that this was a necessary matter to take into account. I shall return to it also. 82 No written or oral submission was addressed to Ground 7. The particulars in the originating application state: Particulars of Ground Seven: a) The Tribunal decided to permit the First and Second Respondents to give video evidence solely on the basis that the Commissioner declined "to offer any undertakings with respect to the possible issue of DPOs" (at [30]); b) The Tribunal acknowledged that "the only basis relied upon" by the First and Second Respondents was their fear, inter alia, that they may be issued with DPOs, yet treated that fear as the determinative factor, giving no weight to the evidence of the First and Second Respondents that any undertaking by the Commissioner with respect to a DPO would not be sufficient to meet the conditions they sought: at [15]-[16]; [20]. 83 I think the AAT's approach to the evaluation of the issues before it was incorrect and wrongly limited in the way suggested by those particulars but that does not carry with it the further conclusion that the AAT's decision was unreasonable, irrational or illogical, as well as wrong. Whether the error was jurisdictional error at this interlocutory stage is a separate question, not raised by Ground 7, but is a matter I shall discuss in terms of relevance when I return to that issue.

Grounds based on ss 39 and 43 of the AAT Act and the no evidence ground 84 Ground 2 alleges a breach of s 39 of the AAT Act and of procedural fairness. In support of Ground 2, the Commissioner submitted that the taxpayers were seeking to dictate the terms upon which their application would be heard, or upon which the matter would proceed. I do not think that submission should be accepted because the taxpayers clearly accepted in their affidavits that one consequence of a refusal to give evidence in Australia might be that their applications to the AAT would be unsuccessful. However, I think it is certainly true to say that the taxpayers were seeking to dictate the circumstances in which, if at all, they would give evidence. 85 The AAT suggested that if evidence was not taken by video link the taxpayers' affidavit material might need to be considered "on its own" (at [31]) and the taxpayers would be "deprived of the opportunity to give oral evidence" (at [33]). In the circumstances of the present case, that would be the result of their declared choice. That choice was not solely related to the possibility of a DPO. In that connection, I can see no relevance in the circumstance that the taxpayers bore the onus in the AAT proceedings. 86 Their position was, as disclosed by their affidavits, that unless assured that they would neither be prevented from leaving, nor subject to prosecution, they would not travel to Australia to be cross-examined. That was their declared choice. It took into account the possible consequence for their respective applications to the AAT. I see no basis upon which to assume that if the Commissioner had given an undertaking not to issue a DPO, the taxpayers would have come to Australia. They said they would not. 87 The AAT did not discuss the whole or actual basis upon which the taxpayers declared their positions. Rather, the AAT focussed attention on the Commissioner's refusal to give an undertaking about one aspect of their position. The limited consideration of the declared bases of the taxpayers' refusal to travel to Australia has had the result that the taxpayers have been relieved of the consequences of their declared choices and the Commissioner has been confined to a limited, remote, non-compellable cross-examination of a party to the proceedings. 88 In my view, in combination with the matters discussed further hereunder, that does amount to a failure to observe and apply s 39 of the AAT Act and a denial of procedural fairness to the Commissioner. 89 Ground 5 alleges that there was not a "skerrick of evidence" to support the decision of the AAT. I cannot accept this argument. There is no reason to doubt that the taxpayers were apprehensive about the possible consequences of returning to Australia and the possible deprivation of liberty (or liberty of movement) that might result. Refusal of the undertaking sought might have increased their apprehension, as the AAT was entitled to find. 90 Ground 6 alleges no, or insufficient, reasons (c.f. AAT Act, s 43(2), s 43(2B)). Reasons were given. They may disclose error, but I would not accept a complaint of insufficient explanation.

Fundamental issues further addressed in oral argument 91 It is now necessary to return to some fundamental issues about the approach which was taken by the AAT, concentrating particularly upon the notions of legal relevance and procedural fairness. I raised the matters hereunder squarely with the parties at the hearing. 92 The essence of the taxpayers' position was that they should be allowed, when they gave evidence in support of their cases in the AAT, to remain beyond the reach of Australian authorities, and free from any possibility of criminal prosecution. That raises some difficult questions about the approach taken by the AAT. 93 For example, had it been apparent that a refusal to return to Australia was based on a desire to avoid arrest on an outstanding warrant for some crime of violence, it is unthinkable that the AAT would regard it as appropriate to assist in that endeavour or to give it any weight. No different position could be taken in relation to a "white collar crime". Nor, in my view, could a taxpayer be assisted to avoid arrest for a criminal offence arising out of alleged participation in a tax fraud. I do not see that it could make a difference that an arrest was merely a real possibility which a taxpayer wished to avoid. 94 At [28], the AAT referred to some discussion of a similar question by Deputy President Hack in Re Murray and Commissioner of Taxation [2011] AATA 837 at [12]-[17], although it did so to distinguish the circumstances of the present taxpayers from that of "Mr Murray". The AAT's reference to Deputy President Hack's remarks, however, appeared to ignore an important observation at [12], in these terms: 12. Mr Murray's case is founded entirely on his claimed fear that the executive branch of the government might take lawful action to arrest him or to prevent him from departing the country as and when he chose to do so. I have considerable doubt whether that fear may properly be regarded as a relevant consideration however I do not propose to decide that question. I will assume, favourably to Mr Murray, that his fear may be taken into account. Having done so, I remain unpersuaded that it is appropriate to exercise the discretion favourably to Mr Murray. (Emphasis added.) 95 It is important to note that Deputy President Hack was prepared to assume that a fear of arrest or detention might be taken into account because, even on that assumption, there was no justification for taking Mr Murray's evidence by video link. Equally important, however, was Deputy President Hack's reservation about the relevance of that matter. He did not have to resolve that question. In my respectful opinion, in the present case the AAT could not avoid it. 96 The reasoning of the AAT turned decisively on its finding that the taxpayers' fears of detainment were well-founded, even though it accepted that no decision had been made to detain them. In my view, that conclusion emphasised, rather than diminished, the need to examine whether the possibility of detainment, or arrest, was a relevant factor to take into account in the present case. 97 The Commissioner may only act on a belief on reasonable grounds to issue a DPO. He may not deprive a person (an Australian citizen at least) of basic rights on mere speculation (Dalco v Federal Commissioner of Taxation (1987) 19 ATR 443). If the taxpayers have a well-founded fear (as the AAT found) that they might be (it must be assumed legitimately) prevented from leaving Australia, or perhaps even arrested, the question arises directly why that would be relevant in support of a request to give evidence by video link. 98 Of course, an apprehension of that kind might explain a refusal to come to Australia, as it did in the present case, but I cannot see that it would be a relevant matter contributing in any sense to a decision to permit evidence by video link, out of reach of Australian authorities, unless some particular additional personal factor was invoked, as appeared to be the case in Arnold. 99 Different considerations might arise if a party needed to obtain the evidence of an overseas witness who would not come to Australia - possibly. But where a party to proceedings in the AAT puts a request to give video evidence on the basis that the party wishes to avoid any possibility of legitimate action by taxation, regulatory or prosecuting authorities in Australia, I do not see how such a matter (which remains the declared position of the taxpayers regardless of the position of the Commissioner about DPOs) could normally be relied upon as relevant, much less decisive, by the AAT. 100 So far as the particular possibility of a DPO is concerned, there is another factor which is relevant. If the taxpayers came to Australia, and if a DPO was issued, there is a right of review in a court, including this Court. If on such a review a DPO was not lifted it can scarcely be suggested that it was not legitimate or permissible. The effect of the approach taken by the AAT was to pre-empt any possibility of a DPO, regardless of whether justified or not. 101 Arnold does not help to establish any different position to support the request in the present case. It appears from the terms of the judgment that an undertaking was offered. There is no support in the judgment for any proposition that declining to offer an undertaking would have resulted in permission to give evidence by video link for that reason. As I said earlier, different considerations might arise in the case of a non-compellable witness whose evidence was important to the case of a party, but parties themselves are in a different position. They cannot, in my view, expect assistance to avoid the operation of Australian law, at least where adequate recourse to the courts is available. 102 The consequence of the AAT's reasoning upon the rights of the Commissioner to cross-examine was, in my view, profound. The AAT could not expect to exert more than the most basic procedural influence over the conduct of a party giving evidence from Mauritius. The possibility of effective cross-examination on documents, for example, must be regarded as effectively illusory. The ability to cross-examine on credit would be no more effective. Although there can be no suggestion that jurisdictional error is fairly or safely to be deduced only from a preference for a different procedural course, in my view, the restraint upon the ability of the Commissioner to answer the taxpayers' case, and present his own, was so fundamentally affected that the Commissioner was denied procedural fairness. 103 The requirement to allow a party to proceedings in the AAT an opportunity to put a case has been said by the High Court to "lie at the heart of the requirements of natural justice" (R v Moodie; Ex parte Mithen (1977) 17 ALR 219 at 225). In Sullivan v Department of Transport (1978) 20 ALR 323, Deane J referred to R v Moodie and said (at 342): Section 39 of the Administrative Appeals Tribunal Act provides, for present purposes, that "the Tribunal shall ensure that every party to a proceeding before the Tribunal is given a reasonable opportunity to present his case". In dealing with an application for review, the Tribunal is plainly under a duty to act judicially, that is to say, with judicial fairness and detachment. In these circumstances, the requirement contained in s 39 that the Tribunal shall ensure that a party to the proceedings before it be given a reasonable opportunity to present his case constitutes statutory recognition of an obligation which the law would, in any event, imply. Where a Tribunal is under a duty to act judicially, the principle that a party must be given a reasonable opportunity to present his case is at the heart of the requirements of natural justice which it is obliged to observe (see R v Moodie (1977) 17 ALR 219 at 225). 104 The requirement remains equally as important now. 105 As I pointed out earlier, in Hayes, Wilcox J found a denial of procedural fairness when cross-examination was unreasonably fettered. That is what has occurred in the present case. 106 In my view, therefore, the AAT took into account an irrelevant matter, and failed to take into account a relevant matter, as well as failing to give procedural fairness to the Commissioner.

Should the Court intervene? 107 Do the matters I have identified justify intervention on an application for judicial review at an interlocutory stage on a question of practice and procedure? 108 Submissions for the taxpayers pointed out that the Court is normally reluctant to intervene on questions of case management or practice and procedure. However, in my respectful view, the present case is one of a different character and quality. 109 Geographical Indications Committee v The Honourable Justice O'Connor [2000] FCA 1877, which was relied upon in support of the submission does not assist the taxpayers. That Full Court decision, while emphasising the general undesirability of intervention by judicial review at an interlocutory stage, really turned on a conclusion that the applicant for judicial review did not have a sound claim (at that point in time at least) that it had been denied procedural fairness. 110 The vice in the present case is twofold for the reasons I have already explained. The AAT has put aside as not relevant, or at least has failed altogether to address, a vital ingredient in the declared position of the taxpayers. Their position was not confined to, or by, the attitude of the Commissioner to DPOs. The Commissioner's refusal to give an undertaking, either to the AAT or to the taxpayers, did not alter their preparedness to come to Australia or affect or exhaust their reason to do so. 111 Additionally, and in any event, any conclusion that the Commissioner's position was forensically unaffected by the decision to allow the taxpayers to give effectively non-compellable, unsupervised, evidence from Mauritius at their ongoing discretion was unsustainable. That would, in the circumstances of the present case at least, deny the Commissioner any fair opportunity of cross-examination on matters potentially critical to an assessment of the taxpayers' cases. In my view, that was a denial of procedural fairness and a breach of s 39(1) of the AAT Act. It went well beyond a legitimate exercise of discretion in the taxpayers' favour. As in Hayes, the prejudice would be incurable. 112 I need now to deal with the additional authority to which a reference was provided after the hearing had concluded. That case is a decision of Beaumont J of this Court in Federal Commissioner of Taxation v Grbich & Shen (1993) 93 ATC 4564; [1993] FCA 516 ("Grbich"). 113 Mr Grbich was a Senior Member of the AAT. Mr Shen was a taxpayer who was assessed for tax and penalties totalling $1.6m. He objected but then left Australia for Hong Kong. He applied to give evidence by VCF (video conference facility). The application was granted. The Commissioner applied to this Court under s 16(2) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act") for judicial review of the decision. Beaumont J recorded: It is said, on behalf of the Commissioner, that taking Mr. Shen's evidence in the manner proposed would effectively deprive the Commissioner of his right to cross-examine Mr. Shen and, the argument runs, this would amount to procedural unfairness. The Commissioner seeks an order under the AD(JR) Act that the Tribunal be restrained from receiving any evidence from Mr. Shen on matters involving his credit unless he gives that evidence in person before the Tribunal. 114 Beaumont J referred to the judgment of Wilcox J in Hayes but distinguished it. The application for judicial review was dismissed for "discretionary reasons". In particular, Beaumont J said: Generally speaking, there are strong policy considerations against the Court's intervening under the AD(JR) Act in other proceedings on evidentiary questions (see, e.g. Seymour v Attorney-General (Cth) (1984) 4 FCR 498; cf. Yates v Wilson & Ors 89 ATC 4494; (1989) 168 CLR 338). 115 Neither of the cases there cited appears to me to have direct relevance to the present case. They each concerned the principle of restraint when considering possible interlocutory error in the criminal justice process. 116 Seymour v Attorney-General (Cth) (1984) 4 FCR 498 concerned whether the Court should grant relief under the ADJR Act on a question of admissibility of evidence in a committal proceeding where no question of jurisdiction arose. In Yates v Wilson (1989) 168 CLR 338, the entirety of the judgment of the High Court reads: It would require an exceptional case to warrant the grant of special leave to appeal in relation to a review by the Federal Court of a magistrate's decision to commit a person for trial. The undesirability of fragmenting the criminal process is so powerful a consideration that it requires no elaboration by us. It is a factor which should inhibit the Federal Court from exercising jurisdiction under the Administrative Decisions (Judicial Review) Act 1977 (Cth) and as well inhibit this Court from granting special leave to appeal. 117 The present proceedings arise under s 39B of the Judiciary Act. They do not raise identical issues to those under s 16 of the ADJR Act. Decisions based on discretionary grounds are not generally binding as a matter of precedent or comity. In the present case, I have found that the AAT committed jurisdictional errors. In my respectful view, in those circumstances, the judgment of Wilcox J in Hayes is a surer guide than that of Beaumont J in Grbich. I would not withhold relief in the present case on discretionary grounds. 118 As I said earlier in this judgment, my conclusions relate to the facts of this particular case. I am not to be taken to suggest that it can never be relevant in the case of a witness (or even a party) to take into account whether the Commissioner is prepared to indicate that a DPO will not issue. I am not to be taken to make any criticism of Arnold. The circumstances of the present case are unusual. The taxpayers point blank refused to come to Australia unless stipulated conditions were met. An assurance about a DPO would not have been sufficient. The Commissioner's position about that issue could have no impact on the practical position.

Conclusion and Relief 119 In my view, this is one of those rare, or exceptional, cases where the Court should intervene at an interlocutory stage to correct jurisdictional error and address injustice between the parties. 120 In the present case, the Commissioner sought the remedies of certiorari and mandamus, upon the conventional footing that, if the AAT had made a jurisdictional error so that its decision should be set aside, normally it would address the matter again. On an alternative view, prohibition might have been sought to prevent any further reliance on the decision, leaving it for the AAT to deal with any future application to it on the merits. I have no doubt that, on the findings I have made, I could issue a writ of prohibition, instead of mandamus, as an appropriate form of relief in the present case. However, it is not necessary to do so. Neither is it necessary to issue a writ of mandamus. 121 In the circumstances of the present case, having regard to the discussion by the Full Court in Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (2007) 157 FCR 260, I am satisfied that certiorari is the most appropriate, and only necessary, remedy (see also R v Cook; Ex parte Twigg (1980) 147 CLR 15 per Barwick CJ at 18, Gibbs J (with whom Stephen J, Mason J and Wilson J agreed) at 25-26, Aickin J at 33-34). 122 The AAT need not deal further with the particular application which was before it. If a further application is made which merits consideration and raises different issues, the AAT will no doubt follow its usual procedures, bearing this judgment in mind. If the taxpayers do not appear at the hearing to be cross-examined on their affidavits, the AAT will need to deal with the proceedings, and make its rulings and decision, in that light. 123 The order made by the AAT will be set aside. Costs should follow the event. I certify that the preceding one hundred and twenty-three (123) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan.