Lack of Legal Effect and Obligation to Consider
76 Although PS LA 2011/27 is framed in imperative language, it is not (and does not purport to be) an exercise of any delegated law-making power and does not have statutory force. Nor is there any provision in the 1936 Act that expressly or impliedly requires the Commissioner to consider whether some form of concessional treatment should be extended (assuming that to be possible) to taxpayers in circumstances where earlier conduct by the ATO might have contributed to them ordering their affairs in a particular way. PS LA 2011/27 is referable only to s 8 of the 1936 Act vesting the "general administration" of the Act in the Commissioner. While that may in some senses be properly described as a "power", though more accurately described as a duty, it does not include a power to make decisions that create, extinguish or modify the legal rights of taxpayers; nor does it include a power to promulgate rules that create legal rights or immunities or that otherwise have the force of delegated legislation.
77 This lack of statutory force and the lack of any identifiable obligation to consider exercising his "powers of general administration" in this way, is an additional reason why mandamus in the terms sought in the Amended Application does not lie against the Commissioner. A writ framed in those terms could not be said to compel the performance of any statutory duty.
78 Nor would mandamus in those terms lie against the second respondent, Mr Campbell. To the extent that Mr Campbell was to decide whether to "apply the ATO view of the law … solely prospectively", he would only do so as a delegate of or on behalf of the Commissioner. The fact that the Commissioner has issued instructions to his officers, as to when and on what basis such a decision is to be made, does not convert those instructions into statutory obligations enforceable at the suit of a taxpayer. Enforcement of those instructions is a matter for the Commissioner.
79 Further, as noted in [75(2)] above, the unavailability of mandamus provides a compelling reason why certiorari would not issue to quash the decision; and the decision under review in any event has no direct effect on legal rights capable of being quashed. It is important to note that what is in issue at this stage of the analysis is the effect (or lack thereof) of the decision on legal rights and obligations, in the sense of whether the decision has some legal force capable of being quashed or set aside, and not whether there is a sufficient effect on a particular person's interests to ground an obligation to afford procedural fairness to that person as submitted by the applicants.
80 Similar considerations stand in the way of the other orders sought in the Amended Application.
(a) As to the orders sought in prayer 4, the decision cannot be said to have been "invalidly" made in the absence of any binding limitation on Mr Campbell's powers which can be said to have been transgressed. The proposed order requiring a further decision to be made is not appropriate for the same reasons as mandamus does not lie.
(b) As to the orders sought in prayer 5, PS LA 2011/27's lack of statutory force means that a declaration to the effect that it was not complied with would not serve to settle any dispute as to legal rights. Nor is it a condition of the lawfulness of any contemplated future action, by either of the respondents, that a decision has been made "in conformity with" PS LA 2011/27. The circumstances in which an injunction would be appropriate do not exist.
81 Underlying these points about the availability of remedies is the central proposition that the applicants' case seeks to find enforceable obligations in a document which has no statutory force. If the view of the law expressed in the position papers is wrong, it is amenable to correction in Pt IVC proceedings. The relief sought proceeds on the premise that the respondents can be ordered to apply another view in the assessment process, irrespective of whether it is correct or not. If there were some obligation which could be enforced against the respondents so as to require the assessment to proceed on a particular basis, thereby affecting the amount of tax payable, the failure to perform that obligation would be something that could be taken up in proceedings under Pt IVC. But there is not. The obvious reality (apparently accepted by the applicants) that the Court or Tribunal in Pt IVC proceedings could not be asked to apply an incorrect view of the relevant taxing provisions serves to illustrate the incongruity of the contention that the Commissioner could be ordered to take such a course in making an assessment.
82 Meanwhile, each of the applicants' grounds of review is in effect a complaint that a "decision" was not made in accordance with PS LA 2011/27. Relevantly, the only decision is whether to make an amended assessment, and in what terms. Such complaints cannot lead to a grant of relief because PS LA 2011/27 is neither a source of power, nor a limitation on the scope of any power, to make decisions affecting legal rights; and the decision itself, unless and until put into effect by some step taken under the legislation (such as the issue of an assessment), does not have sufficient substance at law to make it a proper subject-matter for judicial review.
83 That representation as to procedure, can, in limited circumstances, give rise to an obligation to act fairly before departing from the representation, does not assist the applicants here. The issue here is, what view of the substantive law should be applied in the assessment process? That is a question which falls to be determined by reference to the substantive provisions, subject to any relevant authority on their meaning, unconstrained by any procedural representation.
84 Nor is the applicants' position assisted by seeking relief directly against the second respondent, Mr Campbell, on the basis that PS LA 2011/27 is said to be binding on him.
(1) As noted in the applicants' submissions, no relevant delegation of statutory power exists. The two letters sent by Mr Campbell were signed by him on behalf of the Deputy Commissioner, Mr Konza. To the extent that they took effect under the tax legislation, they did so as things done in the name of the Deputy Commissioner under the principle discussed in Carltona v Commissioner of Works [1943] 2 All ER 560, 562-563 and O'Reilly v Commissioners of the State Bank of Victoria (1982) 153 CLR 1, 11-12.
(2) If Mr Campbell's acts were done within the scope of authority conferred on him consistently with that principle, to act on the Commissioner's or a Deputy Commissioner's behalf, they have effect as acts of the Commissioner. Their legal validity or efficacy thus depends on the scope of the Commissioner's powers and the requirements for the proper exercise of those powers. PS LA 2011/27 in the present case does not bind the Commissioner; it could at any time be withdrawn by him, or expressly or impliedly amended.
(3) If Mr Campbell's acts were not done within the scope of authority conferred on him, all that follows is that they would not have legal effect as acts of the Commissioner. If they purported to be exercises of statutory power affecting the applicants' rights, the applicants would be entitled to ignore them. That does not advance matters in the present case. It would have the result that no decision has yet been made by the Commissioner as to whether to apply the correct view of the relevant taxing provisions to past income years; but that does not avail the applicants if, as the respondents submit, the Commissioner is not under any statutory duty to make that decision in any event.
(4) The Carltona principle, therefore, is no more than a mechanism by which acts of a subordinate are attributed to the officer who is the repository of the relevant power (and may then be tested for validity by reference to the scope of the statutory officer's power). It does not provide a basis for orders to be obtained against the subordinate, at the suit of a third party, by way of enforcement of the statutory officer's instructions. Any such orders would usurp the power of the statutory officer (here, the Commissioner) to vary the instructions from time to time, to excuse non-compliance with them or to choose to have the function performed by a different subordinate.
(5) In any event, PS LA 2011/27 does not on its face purport to constitute the source of any particular officer's authority to exercise powers in the Commissioner's name. Nor does it define the extent of that authority, in any sense relevant to the Carltona principle: it does not designate a class of matters in which a particular officer is authorised (in the sense that an agent under the general law would be authorised) to act on behalf of the Commissioner. Rather it is part of the Commissioner's instructions - binding in the sense that he expects them to be carried out - as to how officers who do have that authority are to act. The only relevant legal limits on power are the limits on the Commissioner's powers under the 1936 Act.
85 There is some analogy here with the instructions (termed "Guidelines") which successive Ministers for Immigration have issued to their officers, as to classes of cases that are to be brought to the Minister's attention for the possible exercise of one of the non-compellable ministerial discretions under the Migration Act 1958 (Cth). This Court has repeatedly refused to entertain attempts to enforce those instructions by seeking orders against the officers based on alleged non-compliance with them, e.g., S1083 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 1455; Raikua v Minister for Immigration and Multicultural and Indigenous Affairs (2007) 158 FCR 510 (esp at [64]).
86 In the special circumstances of Plaintiff M61/2010E v Minister for Immigration and Citizenship (2010) 243 CLR 319 (referred to in the applicants' submissions), where the procedure being undertaken (and its relationship to specific potential exercises of statutory power) provided the legal foundation for the detention of the plaintiffs (at [71]), and where that procedure constituted the means of compliance with Australia's obligations under the Refugees Convention (which were understood to underlay the text and structure of the Act) (at [27], [70]), the High Court saw utility in granting declaratory relief to the effect that the advice to the Minister was affected by denials of procedural fairness and errors of law (at [103]). The analogy breaks down at this point, however. The matter must be considered in the appropriate statutory context. That context relevantly includes the comprehensive review and appeal mechanisms in Part IVC. The present case does not have anything comparable to the special features of Plaintiff M61 just mentioned. In particular, a decision of the kind contemplated in PS LA 2011/27 may affect whether the ATO takes "compliance action" but does not have a necessary or direct relationship with any particular exercise of statutory power.
87 For the foregoing reasons, I am satisfied that the applicants have no reasonable prospect of obtaining the final relief they seek and the proceeding must, in consequence, be summarily dismissed pursuant to s 31A(2) of the FCA Act.
I certify that the preceding eighty-seven (87) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds.