Deputy Commissioner of Taxation v Ziolkowski

Relevant considerations - service outside of Australia 5 There are three matters upon which the Court must be satisfied before granting leave to serve outside of Australia. These are set out in r 10.43(4) of the FCRs: (a) first, that the Court has jurisdiction in the proceeding; (b) secondly, that the Court has power to order service outside Australia, that is, that the proceedings are of a kind mentioned in r 10.42 of the FCRs; and (c) thirdly, that the applicant has a prima facie case for all or any of the relief claimed in the proceedings. 6 These matters were discussed by me in Warner v Hung in the matter of Bellpac Pty Ltd (Receivers and Managers Appointed) (In Liquidation) [2013] FCA 120. As to the first of those matters, that relates to jurisdiction, it is clear that this Court has original jurisdiction to hear and give judgment in a matter for the recovery of taxation liabilities under section 39B(1A)(c) of the Judiciary Act 1903 (Cth) (see also Deputy Commissioner of Taxation v Vasiliades [2015] FCA 412 at [3]). 7 As to the second matter, the FCRs require that the proceeding be of a type identified in r 10.42. This includes a "proceeding based on a cause of action arising in Australia". As indicated above, there is no doubt that this is a proceeding which is based on a cause of action arising in Australia. 8 The third matter requires the Court to be satisfied that the applicant has a prima facie case. There is no doubt that the applicant has a prima facie case here, when regard is had to the provisions in the taxation legislation which have the effect of making notices of assessment and amended assessments conclusive evidence of certain matters. Under s 350-10(1) of Schedule 1 to the TAA 1953, the notices of assessment and amended assessment produced by the applicant in respect of income tax liabilities are conclusive evidence in these proceedings, that: (a) first, the assessments were properly made; (b) secondly, the notices were properly given to the defendant; and (c) thirdly, except in proceedings under Part IVC of the TAA 1953 on a review or appeal relating to the assessment, the amounts and particulars of the assessment, declaration or notice are correct. 9 There are authorities which indicate that these matters satisfy the prima facie case requirement, including Commissioner of Taxation v Ornelas [2016] FCA 457 at [7] and Deputy Commissioner of Taxation v Ghaly [2016] FCA 707 at [25].

Service under the Hague Convention 10 In Mr Klendo's affidavit, it is stated that the respondent currently resides in the United States of America. The respondent's immigration travel records reveal that he left Australia for the United States on 22 January 2014 and has not returned. 11 The respondent lodged an objection to the relevant assessments, in which he notified his address as being in New York in the United States, and requested the applicant send all correspondence to him directly. He also confirmed his email address and as indicated above, the applicant's belief that the respondent currently resides in the United States. 12 The United States is a signatory to the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters opened for signature 15 November 1965, 658 UNTS 163 (entered into force 10 February 1969) (Hague Service Convention) and accordingly it is open to the Court to grant leave to serve documents in accordance with the Hague Service Convention, pursuant to Div 10.6 of the FCRs. 13 In his affidavit, Mr Klendo refers to the website http://www.hcch.net/en/states/ authorities/details3/?aid=279 which is apparently authorised by the United States and which provides practical information as to how service of overseas process in the USA can be made in accordance with the Hague Service Convention. The website stipulates that personal service is the preferred method to execute requests, and that is the process which the applicant proposes to follow in this case. 14 For these reasons, it is appropriate to make the orders sought by the applicant, save that I will also direct that the originating application and statement of claim, together with some other material, be served upon the respondent in accordance with the processes outlined in the website. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths.