PAAN INVESTMENTS PTY LTD (IN LIQUIDATION) v COMMISSIONER FOR REVENUE FOR THE AUSTRALIAN CAPITAL TERRITORY

[2014] ACTSC 161

The appeal first instituted by the appellant in the ACT Civil and Administrative Tribunal against the ACAT decision made on 16 April 2012 (PAAN Investments Pty Ltd (In Liquidation) v Commissioner for ACT Revenue [2012] ACAT 19) by the filing of an Application for Appeal from an ACAT decision on 14 May 2012 be dismissed.

The appellant pay the respondent's costs of and incidental to that appeal.

ADMINISTRATIVE LAW - whether an appeal under s 79(3) of the ACT Civil and Administrative Tribunal Act 2008 (ACT) which has been removed to the Court pursuant to s 83(2) of that Act should be allowed - what is the nature of such an appeal - what is the function of the Court in determining such an appeal - whether s 82 of that Act applies to such an appeal after it has been removed to the Court

ACT Civil and Administrative Tribunal Act 2008 (ACT), ss 3, 77-87 and the Dictionary

Administrative Appeals Tribunal Act 1975 (Cth), s 44(1)

Corporations Act 2001 (Cth)

Legislation Act 2001 (ACT), s 155 and s 156(1)

Taxation Administration Act 1999 (ACT), ss 11(2), 56B, 100, 101, 102, 103(1), 107, 107A, 108A and s 1.2 of Sch 1

Court Procedures Rules 2006 (ACT), r 5051 and r 5052

Birdseye v Australian Securities and Investments Commission [2003] FCAFC 232; (2003) 38 AAR 55

Comcare v Etheridge [2006] FCAFC 27; (2006) 149 FCR 522

Commissioner for Revenue (ACT) v Slaven [2009] FCA 744; (2009) 178 FCR 334

House v The King [1936] HCA 40; (1936) 55 CLR 499

Hunter Valley Developments Pty Ltd v Cohen [1984] FCA 176; (1984) 3 FCR 344

Legal Practitioner v Council of the Law Society of the ACT (2011) 257 FLR 118

O'Donnell v Environment Protection Authority [2012] ACTSC 140; (2012) 192 LGERA 1; (2012) 268 FLR 48

PAAN Investments Pty Ltd (In Liquidation) v Commissioner for ACT Revenue [2012] ACAT 19

TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation [1988] FCA 119; (1988) 82 ALR 175

PAAN Investments Pty Ltd (In Liquidation) (Appellant)

Commissioner for Revenue for the Australian Capital Territory (Respondent)

Court/Tribunal: ACT Civil and Administrative Tribunal

Medium Neutral Citation: PAAN Investments Pty Ltd (In Liquidation) v Commissioner for ACT Revenue [2012] ACAT 19

1. In the period from about 1992 to 31 August 2003, the appellant, PAAN Investments Pty Ltd (In Liquidation) (formerly called Star Security (ACT) Pty Ltd) (PAAN), carried on the business of providing security services under the name "Star Security". Most of PAAN's business in that period was conducted in the Australian Capital Territory. PAAN provided static patrols such as security guards at Coles supermarkets and at Government offices. It also provided mobile night patrols to other premises. In addition, it made available security staff for ad hoc events in Canberra (such as Floriade and sporting events at Bruce Stadium).

1. According to Mr Peter Georgiou, the principal of PAAN until its liquidation, for some time after 1997, PAAN also acted as the trustee of the Peter Georgiou Family Trust (PGFT). PAAN contends that the PGFT held all of the assets of the Star Security business from about early 1998 until those assets were sold in September 2003. It also contends that PAAN employed staff who worked in that business in its own right and not as trustee of the PGFT.
2. From 1995 onwards, Peter Georgiou and his wife, Angela, were the only shareholders in PAAN. In the period up to 2001, Mr and Mrs Georgiou were also the only directors of PAAN. Mrs Georgiou resigned as a director in 2001. Thereafter, Mr Georgiou was the sole director of PAAN. Throughout the period from 1 July 1998 to 22 December 2004 (the relevant period), Peter Beames, of Peter Beames & Associates, Chartered Accountants, acted as PAAN's accountant. In the same period, Mr Archie Tsirimokos, of Vandenberg Reid and later of Meyer Vandenberg, acted as PAAN's solicitor.
3. During 2003, PAAN became involved in discussions with the Commissioner for ACT Revenue (the Commissioner), who is the respondent to the present appeal. The subject matter of those discussions was payroll tax. Later in 2003, the Commissioner began to pursue PAAN for arrears of payroll tax. At this time, PAAN was contending in discussions with the Commissioner that it was an employment agent as outlined in the Payroll Tax Act 1987 (ACT) and in circulars 39, 65 and 69 issued by the Commissioner.
4. In September 2003, PAAN sold the Star Security business for $1.387 million in an arm's length transaction. Thereafter, it ceased to trade. Steps were then swiftly taken by PAAN to distribute its net assets to the beneficiaries of the PGFT.
5. On 1 November 2004, the Commissioner issued to PAAN an assessment for payroll tax in the amount of $578,291.34 in respect of the period from 1 July 1998 to 31 August 2003 (the assessment). That assessment was by way of estimate after investigation and comprised $450,321.44 primary tax plus penalties and interest less amounts paid. The assessment was made pursuant to s 11(2) of the Taxation Administration Act 1999 (ACT) (TAA). By the assessment, PAAN was informed that, if it was dissatisfied with the assessment, it might, within sixty (60) days of service thereof, lodge with the Commissioner a written objection to the assessment. This was an accurate statement of PAAN's objection rights at the time (see ss 100, 101 and 102 of the TAA). Under s 103(1) of the TAA, the Commissioner had the power to permit a person to lodge an objection after the 60 day period. Thus, it was always open to the Commissioner to extend the time within which PAAN might object to the assessment. The Commissioner's discretion under s 103 is unfettered. That discretion was required to be exercised consistently within the scope and purpose of the TAA but was not otherwise constrained by the need to take into account specific criteria.

7. In the present case, on the assumption that the assessment was served upon PAAN on 3 November 2004 and on the further assumption that Public Holidays are not to be counted, the 60 day period specified in s 102 of the TAA expired on 5 January 2005.

8. On 2 December 2004, the Commissioner served upon Mr Georgiou a Final Notice Before Summons pursuant to s 56B(2) of the TAA (compliance notice). This Notice was addressed to him personally. Service of this Notice rendered Mr Georgiou immediately liable to pay the tax which had been assessed against PAAN in the assessment. The Notice specified that payment of that amount of tax was required to be made by 23 December 2004.

9. Thereafter, Mr Georgiou took steps to put PAAN into liquidation. He did so on the advice of Mr Beames and possibly Mr Tsirimokos. PAAN was placed into a creditor's voluntary winding up on 22 December 2004. Michael Slaven was appointed liquidator. Under s 56B(5)(c) of the TAA, for the purposes of s 56B, an assessment is taken to be withdrawn if, and as soon as, the corporation begins to be wound up within the meaning of the Corporations Act 2001 (Cth). As I have already mentioned, PAAN was wound up on 22 December 2004. That circumstance engaged s 56B(5)(c) of the TAA with the consequence that the Commissioner's claims against Mr Georgiou evaporated on 22 December 2004. The payroll tax was not paid in 2004 and has not been paid subsequently.

10. In 2009, the Commissioner took steps in the Federal Court of Australia to recover the unpaid payroll tax by seeking leave to bring an action against Mr Georgiou personally in the name of PAAN.

11. On 10 July 2009, Rares J made an order that the Commissioner be authorised at his own expense and risk as to costs to use the name of PAAN as a plaintiff or co-plaintiff in proceedings against Peter Georgiou, Angela Georgiou and Peter Beames. That order was made on terms which were more fully set out therein. His Honour authorised proceedings in accordance with a detailed draft Statement of Claim which was tendered in evidence before him. His Honour's orders were supported by Reasons for Judgment delivered on 10 July 2009 (Commissioner for Revenue (ACT) v Slaven [2009] FCA 744; (2009) 178 FCR 334). It is not necessary, for present purposes, to refer to his Honour's Reasons in detail.

12. Pursuant to the order made by Rares J on 10 July 2009, on 21 August 2009, proceedings were commenced by PAAN and the Commissioner in the Federal Court (ACD 35 of 2009) (the Federal Court proceedings). Those proceedings have not yet been heard.

13. On 31 August 2010, PAAN, with the consent of the liquidator, informally sought an extension of time within which to lodge an objection to the assessment. This was a year after the Federal Court proceedings had been commenced and almost six years after the assessment had been issued. A formal and detailed application for an extension of time was lodged with the Commissioner on 17 December 2010. The extension of time sought by PAAN was refused by the Commissioner on 28 March 2011. Following an internal review, that refusal was confirmed on 4 July 2011. This latter refusal (the last refusal) was reviewable by the ACT Civil and Administrative Tribunal (ACAT) (see ss 107, 107A, 108A and s 1.2 of Sch 1 of the TAA). ACAT was established under the ACT Civil and Administrative Tribunal Act 2008 (ACT) (ACAT Act) in 2008. On 13 July 2011, PAAN applied to ACAT for review of the last refusal.

1. On 16 April 2012, a Senior Member of ACAT (Mr A O'Neil) affirmed the last refusal (PAAN Investments Pty Ltd (In Liquidation) v Commissioner for ACT Revenue [2012] ACAT 19).

15. On 14 May 2012, PAAN filed with ACAT an "Application for Appeal from an ACAT Decision" dated 14 April 2012 (the appeal). That document appears to have been wrongly dated. It is clear that it was, in fact, dated and filed on 14 May 2012 (not 14 April 2012). By the appeal, PAAN sought an order setting aside ACAT's decision of 16 April 2012 and an order that it have leave pursuant to s 103 of the TAA to make an objection against the assessment out of time.

79 Appeals within tribunal

(1) This section applies if -

(a) the tribunal has decided an application (the original application); and

(b) the original application was not an appeal from a decision by the tribunal.

(2) However, this section does not apply to an application for review of a decision under the Heritage Act 2004, the Planning and Development Act 2007 or the Tree Protection Act 2005.

(3) A party to the original application may, by application, appeal the decision to the tribunal on a question of fact or law.

83 Removal of applications from tribunal to Supreme Court

(1) If the parties to an application or an appeal (a matter) jointly apply to have the matter removed to the Supreme Court, the tribunal must order that the matter be removed to the Supreme Court.

(2) If a party to a matter applies to have the matter removed to the Supreme Court, the tribunal may, if it considers it appropriate, order that the matter be removed to the Supreme Court.

18. In its appeal application, PAAN requested ACAT to remove the "matter" (in this case, the appeal) to the Supreme Court of the ACT pursuant to s 83(2) of the ACAT Act. The Commissioner did not object to such removal. Accordingly, on 1 June 2012, the President of ACAT made an order in the following terms:

1. There being no objection by the respondent to the appellant's request for the matter to be referred directly to the Supreme Court, this appeal is referred to the Supreme Court pursuant to s 83(2) of the ACT Civil and Administrative Tribunal Act 2008.

Strictly speaking, this was not an order for referral. Rather, it was an order for removal of the appeal to this Court.

19. There is no doubt that the decision made by Senior Member O'Neil on 16 April 2012 was a decision which determined an application which was an "original application" within the meaning of s 79(1) of the ACAT Act. There is also no doubt that the application which Mr O'Neil decided was not an appeal from a decision of ACAT. Nor was the last decision made by the Commissioner a decision which fell within s 79(2) of the ACAT Act.

20. It follows that subs (3) of s 79 of the ACAT Act was validly engaged when PAAN filed its appeal from Senior Member O'Neil's decision on 14 May 2012.

21. In the circumstances, there is also no doubt that the appeal has been validly removed to this Court pursuant to s 83(2) of the ACAT Act.

22. Prior to the making of the President's order on 1 June 2012, the appeal was required to be determined by an appeal tribunal within ACAT in accordance with the relevant provisions of the ACAT Act. From 1 June 2012, ACAT has no longer been seised of the matter. At all times thereafter, it has been the Court which has been charged with the responsibility of hearing and determining the appeal. In conformity with s 79(3) of the ACAT Act, however, the appeal must be "... on a question of fact or law".

23. By these Reasons for Judgment and in my capacity as a judge of this Court, I determine PAAN's appeal from the decision made by ACAT on 16 April 2012. My task is to determine that appeal as a judge, not as a member of ACAT. I am not a member of ACAT.

24. In its Reasons for Decision, after introducing the review, after setting out the relevant provisions of the TAA and after referring to s 6 and s 9 of the Payroll Tax Act 1987 (ACT) (PTA), ACAT moved to describe the hearing and to consider the parties' arguments. ACAT then looked briefly at the evidence given by Mr Georgiou at the hearing before it. At [13] of its Reasons for Decision, ACAT said that Mr Georgiou had testified that there were arithmetical and other errors in the total sum of $233,066.17 which he argued had infected the assessment. ACAT also said that Mr Georgiou had testified that, if PAAN was in fact an employment agent and if the eight day rule applied to it, then the resulting exemption further reduced the payroll tax owing to $160,589.17. ACAT noted that Mr Georgiou tendered in evidence before ACAT his calculations in support of these assertions together with all of the documents relied upon by him.

25. At [14], ACAT noted some of the evidence given by Mr Georgiou as to the business history of PAAN prior to its liquidation.

26. At [15]-[16] of its Reasons for Decision, ACAT said:

During 2003 and part of 2004 there were numerous communications between PAAN represented by Beams and Associates [sic] and the Commissioner regarding the exemptions that PAAN believed it was entitled to. The assessment of 1 November 2004 made it clear that the Commissioner had rejected PAAN's submissions. On 30 November 2004, Mr Georgiou met with PAAN's solicitor and accountant who also acted for him personally. They discussed what actions were available, including that Mr Georgiou put PAAN into funds, so that the assessment could be contested. Their advice however was to see an insolvency practitioner which they did on 9 December 2004. Shortly afterwards, Mr Georgiou was told by his accountant that the recommendation from the meeting was to place PAAN into liquidation, which he did on 22 December 2004.

Mr Georgiou was understandably concerned about the issue of personal liability. At the time of his public examination in August and September 2006 and March 2007, he did not think the issue was personal liability but rather whether or not the company had traded while insolvent. He was not worried because he said he knew it had not traded in that condition. He told the Tribunal it was "a nasty shock" when he was served with Federal Court proceedings in August 2009. On 21 December 2009, his solicitors sought the liquidator's permission to contest the assessment which was given on 7 May 2010. However they ceased to represent him because of a conflict of interest and the permission was not conveyed to him. His new solicitors wrote to the liquidator on 28 June 2010, received permission on 28 July 2010 and contacted the Commissioner on 31 August 2010.

27. At [17], ACAT commenced its consideration of the principal issue before it, viz whether it would exercise its undoubted discretion under s 103 of the TAA to extend the time within which PAAN might lodge an objection to the assessment.

28. At [18]-[19], ACAT referred to the decision of Wilcox J in Hunter Valley Developments Pty Ltd v Cohen [1984] FCA 176; (1984) 3 FCR 344 at 348-349. In those paragraphs of its Reasons for Decision, ACAT recorded that both parties considered that three of the six principles or criteria referred to by Wilcox J in that case were relevant to ACAT's consideration of the question whether it would exercise its discretion under s 103 of the TAA in the circumstances of the present case. At [18], ACAT noted that Wilcox J considered that these principles should only operate as a guide and should not be regarded as an exhaustive statement of all relevant matters that might be taken into account in the exercise of a discretion of the kind reposed in ACAT under s 103 of the TAA. At [19], ACAT noted that special circumstances need not be shown. Nonetheless, ACAT also noted that Wilcox J had emphasised that prescribed periods ought not to be ignored. His Honour had said that it is the prima facie rule that proceedings ought to be commenced within the period prescribed by the relevant legislative provisions.

29. At [20]-[35] of its Reasons for Decision, ACAT referred to the relevant facts of the present matter and specifically addressed the guidelines identified by Wilcox J in Hunter Valley Developments Pty Ltd v Cohen. ACAT said:

1. There are few facts in dispute in this matter. The assessment was made on 1 November 2004 and served on PAAN within a day or so. On 24 November 2004 Mr Georgiou's accountant was told by the staff of the Commissioner that section 56B of TAA could be used to make a director personally liable for PAAN's tax debt. Mr Georgiou contacted his solicitors the next day. A notice of claim against him personally was served on 3 December 2004. His solicitors advised him on 7 December that section 56B(5) operated to stop personal recovery action against him if an administrator or liquidator was appointed to PAAN. A meeting took place on 9 December between the liquidator, his accountant and solicitor. Following the meeting they advised that he should liquidate the company. On 22 December 2004, the company was placed into liquidation and the liquidator took control of PAAN. Prior to that Mr Georgiou controlled PAAN. On 19 April 2006, at the Annual General Meeting of PAAN Mr Georgiou made a written note that the liquidator said to him "The ACT Government Solicitor asked me if you were prepared to settle. I told them you were not as you had advice to say that you owed them nothing". In August 2009 Mr and Mrs Georgiou were served with Federal Court proceedings against them personally. Their solicitors wrote to the liquidator in late December 2009 and were given permission [by the liquidator] to challenge the assessment out of time.
2. During the six weeks from the service of the assessment to PAAN's liquidation Mr Georgiou as the sole director had the power to object to the tax assessment but did not do so. From that date to the present, he needed the consent of the liquidator which was finally obtained on 28 July 2010. During almost five years from 22 December 2004 to the date he first instructed his solicitors to obtain permission to object i.e. in late 2009, he seems to have done very little. It was always open to him to initiate contact with the liquidator to fund an objection. In April 2006, the Commissioner's solicitors were interested in a possible settlement but Mr Georgiou did not attempt to negotiate with them when the liquidator communicated this interest in a settlement to him. The explanation for the delay is obvious for it was only after August 2009 that the spectre of personal liability arose again. Mr Georgiou was entitled to take advantage of section 56B(3) to limit his personal liability under the TAA and no criticism should be made against him for protecting his assets in this way. He delayed taking action after 22 December 2004 because he believed that his personal assets were not at risk and he only became active in late 2009 when he realised that they were. However, the Tribunal does not believe that this explanation of the delay is acceptable.
3. Wilcox J spoke of his first principle as a precondition to the grant of an extension of time although later decisions of the Federal Court do not seem to have treated the principal in this way. Wilcox J's use of the expression "precondition" however does emphasise the importance he placed on this principal [sic].
4. Principle No.2 was not addressed by the parties.
5. Principle No.3: "Any prejudice to the respondent including any prejudice in defending the proceedings occasioned by the delay is a material factor militating against the grant of the extension".
6. In Windshuttle v Commissioner of Taxation [1993] FCA 553; (1993) 46 FCR 235, Von Doussa J at p.249 said the

"kind of prejudice which is relevant is prejudice that could arise to the opposing party in properly and fairly dealing with the subject matter of the dispute that will require determination if the extension is granted. Relevant matters will be whether witnesses have disappeared or their recollections have faded ................and cannot be refreshed; whether avenues of useful enquiry have dried up or become difficult to pursue; and whether material documents have been destroyed."

1. In this matter, the material documents were made available to the Tribunal. The principal witness gave evidence to the Tribunal as he did in the public examination in late 2006 and early 2007. The Commissioner contended that he had been prejudiced because he had been forced to incur costs of some $374,000.00 for the public examination and the Federal Court proceedings. It seems to the Tribunal that these costs were not incurred in defending proceedings occasioned by the delay and at least some of these costs may be recovered. The Tribunal is of the view that the Commissioner will suffer little or no prejudice if the extension of time is granted.
2. Principal No.4 was not addressed by the parties.
3. Principal No.5: "The merits of the substantial application are properly to be taken into account in considering whether an extension of time should be granted". In Windshuttle at pp.243-244 von Doussa J warned that the Tribunal should not "embark on a full scale trial of the merits of the underlying question". He said that in considering the extension of time, if the factual assertions of the applicant when applied to the relevant law "would bring about the result for which the applicant contends" that would satisfy the requirement that the substantial application had merit. This low level test was expressed in different words by Drummond, Sackville and Hely JJ in Federal Commissioner of Taxation v Brown (19 August, 7 September 1999 unreported) when the court said "the arguable merits test requires the taxpayer's case to be assessed at its highest".
4. The Tribunal has taken account of the evidence of Mr Georgiou and considers that PAAN has an arguable case on the merits.
5. In Zizza v Commissioner of Taxation, both the Full Federal Court [(1999) FCA 848, 99 ATC 4711] and Katz J at first instance [(1999) FCA 37] quoted without dissent the Commonwealth Administrative Appeals Tribunal when it said "merit alone is not a sufficient ground to grant an extension". In Mt Gibson Manager Pty Ltd v Deputy Commissioner of Taxation (1997) FCA 1457 French J found no error of law by the Commonwealth Administrative Appeals Tribunal when it held that no extension of time should be granted even though the Deputy Commissioner conceded that the objection if lodged in time would have been upheld.
6. Principle No.6 was not addressed by the parties.
7. The Tribunal is not aware of any other matters that may affect the decision whether or not to exercise the discretion to grant an extension of time to lodge an objection in this matter.

1. The Tribunal has found that PAAN has an arguable case on the merits, that the Commissioner will suffer little or no prejudice but that there was not an acceptable explanation of the five year delay in applying for an extension of time. The question for the Tribunal is how to reconcile the competing principles. The lack of an acceptable explanation for the delay is in the Tribunal's view the main impediment to the grant of an extension of time. In both Zizza and Mt Gibson Manager five judges of the Federal court considered that having an arguable case on the merits does not necessarily mean that an extension of time must be granted.
2. Applying the law to the facts in this case the Tribunal concludes that an extension of time should not be granted to PAAN under section 103 of the TAA.
3. The Tribunal confirms the decision of the Commissioner.

30. It is apparent from the paragraphs of ACAT's Reasons for Decision which I have extracted or referred to at [26]-[29] above that ACAT was of the view that, in the circumstances of the present case, the lack of an acceptable explanation for the delay was the main reason why an extension of time should not be granted.

31. The substance of the Application for Appeal filed on 14 May is to be found on p 2 of that document. Page 2 is in the following terms:

REASONS FOR APPEAL - PLEASE STATE: (1) THE NATURE OF THE CASE, (2) ANY QUESTIONS OF LAW OR FACT INVOLVED, (3) ANY ADDITIONAL EVIDENCE YOU WISH TO INTRODUCE, (4) REASONS WHY THE APPEAL SHOULD PROCEED,

(5) WHAT REMEDY YOU ARE SEEKING

1. Background

PAAN Investments seek to appeal the decision of the Tribunal constituted by Senior Member O'Neil given on 16 April 2012 to refuse a grant of an extension of time for PAAN Investments to lodge an objection to the Commissioner for ACT Revenue's assessment to refuse to extend the time for which the taxpayer may make an objection against an assessment.

2. Questions of law or fact involved

(a) That the Tribunal erred in exercising its discretion to refuse granting an extension of time to PAAN Investments pursuant to Section 103 of the Taxation Assessment Act 1999 by:

1. Placing insufficient weight on the findings that the Commissioner will suffer little or no prejudice and that PAAN's case had merit;
2. By placing excessive weight upon the finding of the lack of an explanation for the delay.

(b) That the Tribunal erred in finding a lack of acceptable delay in all the attending circumstances.

(c) That the Tribunal's finding is so unreasonable that no reasonable person could make that finding.

3. Any additional evidence in which to produce

The appellant makes no application to produce further evidence at this stage.

4. Reasons why the Appeal should proceed

The Commissioner has commenced proceedings in the Federal Court to recover the assessed payroll tax of $578,291.00 from Mr and Mrs Georgiou personally. Mr and Mrs Georgiou dispute the liability that either no tax should be paid or a significantly lower tax should be paid as the Commissioner has miscalculated the assessable tax. This Appeal raises significant issues of law which should be determined by the Supreme Court.

5. Remedies sought

(a) That the decision of the Tribunal dated 16 April 2012 be set aside;

(b) That PAAN Investments be given leave pursuant to Section 103 of the Taxation Assessment Act 1999 to make an objection against the assessment for payroll tax served by the Commissioner on 1 November 2004.

32. On p 3 of the document, PAAN indicated that it wished the matter (meaning the appeal) to be referred directly to the Supreme Court.

33. PAAN did not make any application to adduce further evidence at any stage.

34. Part 8 of the ACAT Act (ss 77-87) deals with referrals and appeals. Part 8, Div 8.1 addresses ACAT referrals and appeals.

35. Section 79(3) provides that a party to an original (first instance) application made in ACAT may, by application, appeal ACAT's decision on that application on a question of fact or law.

36. Section 80 gives to the appeal president of ACAT a discretionary power to dismiss an appeal if he or she considers that the subject matter of the appeal is substantively similar to other appeals which have already been rejected by ACAT. If ACAT dismisses an appeal under s 80, the applicant may appeal the original decision made by ACAT to the Supreme Court of the ACT under s 86(1)(b) (s 80(3)).

37. Section 81 regulates the constitution of ACAT on an appeal under s 79 which is to be heard by ACAT itself. Such an appeal bench within ACAT is to comprise one or more presidential members or one or more presidential members and one or more non-presidential members. The member who decided the original application is not permitted to sit on an appeal from his or her own decision.

82 Handling appeals

An appeal tribunal may, as the tribunal considers appropriate, deal with an appeal -

(a) as a new application; or

(b) as a review of all or part of the original decision on the application by the tribunal.

39. Section 82 does not apply to the conduct of an appeal by the Court after the appeal has been removed to this Court pursuant to s 83(2) of the ACAT Act, as is the case here. The expression appeal tribunal is defined in the Dictionary in the ACAT Act as meaning "... a tribunal made up under section 81 to review a decision of the tribunal". That definition does not include this Court.

40. The Dictionary is part of the ACAT Act (s 3). A definition in the Dictionary applies to the entire ACAT Act unless the definition, or another provision of the ACAT Act, provides otherwise or the contrary intention otherwise appears (see Legislation Act 2001 (ACT), s 155 and s 156(1)). There is no reason not to apply the Dictionary definition of appeal tribunal to that expression when used in s 82.

41. In my view, s 82 gives to an appeal tribunal within ACAT constituted under s 81 of the ACAT Act additional powers and discretions. In addition to hearing and determining an appeal made under s 79 of the ACAT Act on a question of fact or law, ACAT is given the discretion to deal with a s 79 appeal as a new (or fresh or original) application or as a review of all or part of the original decision the subject of the appeal. These additional ways of dealing with the decision under appeal are not available to the Court under s 82. It may be, as the Commissioner submitted, that s 82 is only engaged after ACAT has allowed the appeal. Looked at in this way, s 82 is to be viewed as a source of power for ACAT to dispose of a successful appeal by making orders other than remitting the matter. After all, there would seem to be little point sending the matter back to the ACAT member who originally decided the case. Whatever may be the true construction of s 82, the Court is required to determine that which is sent to it, namely, the appeal on a question of fact or law.

42. I see no difficulty in the Court not having these additional discretions which are given to an appeal tribunal within ACAT. Those discretions are more appropriately deployed by an administrative decision-maker such as ACAT than by a court.

43. Part 8, Div 8.2 (Supreme Court Referrals and Appeals) (ss 83 to 87) evidences an intention by the legislature to treat matters in this Court which have been referred, transferred, removed or appealed from ACAT as susceptible to different treatment from the way in which those matters might have been treated had they remained with ACAT. I have already extracted s 83 at [17] above. Under s 84, ACAT may refer a question of law to the Court. Under s 85, the appeal president has a discretionary power to decide not to deal with an appeal if he or she forms the view that the appeal could be dealt with more conveniently or effectively by this Court. Under s 86, a party to an appeal who is dissatisfied with a decision of the appeal tribunal itself, a decision to dismiss under s 80 or a decision not to deal with an appeal under s 85, can appeal to this Court on a question of fact or law from whichever of those decisions with which he or she is dissatisfied.

44. It is fairly clear that, whichever pathway to this Court is adopted, the legislature intended that this Court should only deal with:

(a) An appeal from an original decision of ACAT on a question of fact or law (s 79, esp s 79(3), and s 83);

(b) An appeal from a decision of an appeal tribunal within ACAT constituted under s 81 on a question of fact or law (s 79, esp s 79(3), s 81 and s 86(1)(a));

(c) An appeal from the original ACAT decision on a question of fact or law when the appeal lodged with ACAT has been dismissed under s 80 (s 80 and s 86(1)(b)); and

(d) An appeal from the original ACAT decision on a question of fact or law when the appeal lodged with ACAT has not been dealt with by reason of a decision of the appeal president under s 85 (s 85 and s 86(1)(c)).

45. Those appeals described in subpars (b), (c) and (d) of [44] above can only be brought with the leave of the Supreme Court whereas an appeal brought under s 79 which has been removed to this Court under s 83(2) may be brought without leave.

46. Thus, under ss 79, 80, 81, 83, 85 and 86, the Supreme Court is given jurisdiction to hear and determine an appeal from ACAT on a question of fact or law in the particular circumstances specified in those sections. Under s 84, the Court is also empowered to determine a question of law referred to it by ACAT.

47. For these reasons, in my judgment, the Court does not have a general merits review function in respect of ACAT decisions. Its role is circumscribed in the manner which I have summarised at [44] above.

48. Under Pt 5.3 of the Court Procedures Rules 2006 (ACT) (CPR), an appeal means "... an appeal to the Supreme Court from an order of a court or tribunal ...". "Order" includes a decision. Under r 5051 CPR, Pt 5.3 CPR applies to (inter alia) an appeal from a decision of ACAT. Such an appeal might be heard and determined by a judge or a master.

49. Rule 5052 CPR provides:

5052 Appeals to Supreme Court - general powers

(1) For an appeal to the Supreme Court, the court -

(a) has all the powers and duties of the court or tribunal that made the order appealed from; and

(b) may draw inferences of fact; and

(c) may, on special grounds, receive further evidence about questions of fact, either orally in court, by affidavit or in another way; and

(d) may make any of the following orders:

(i) an order confirming, amending or setting aside the order of the court or tribunal appealed from;

(ii) an order remitting the case to be heard and decided again, either with or without the hearing of further evidence, by the court or tribunal in accordance with any direction the court considers appropriate; and

(e) may make any other order that it considers appropriate.

(2) If the Supreme Court orders that it will receive further evidence, and the evidence is to be given by an expert witness, the following rules apply, with necessary changes, to the appeal:

• division 2.12.1 (Expert evidence generally)
• division 2.12.2 (Multiple expert witnesses for same issue)
• rule 1242 (Supplementary expert reports)
• rule 1243 (Expert evidence to be covered by expert report)
• rule 1244 (Expert reports admissible as evidence of opinion etc)
• rule 1245 (Requiring attendance of expert for cross-examination etc)
• rule 1246 (Tender of expert report).

(3) Subrule (1)(c) is subject to rule 5193 (Further evidence on appeal to Supreme Court - Magistrates Court Act 1930, s 214).

50. The expression "... appeal on a question of law ..." appears in s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act), which provides:

44 Appeals to Federal Court of Australia from decisions of the Tribunal

Appeal on question of law

(1) A party to a proceeding before the Tribunal may appeal to the Federal Court of Australia, on a question of law, from any decision of the Tribunal in that proceeding.

51. In the Federal Court, it has been held that an "appeal" pursuant to s 44(1) of the AAT Act is not truly an appeal but is rather an application in the original jurisdiction of that Court (see, for example, TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation [1988] FCA 119; (1988) 82 ALR 175 at 178 per Gummow J). One important consequence of that holding is that, once the Federal Court is seised of an "appeal" under s 44(1) of the AAT Act, it is the practice and procedure of that Court which governs the disposition of the "appeal". Section 44 is not a code which regulates all aspects of an "appeal" under s 44(1).

52. In Birdseye v Australian Securities and Investments Commission [2003] FCAFC 232; (2003) 38 AAR 55 at 60 [17]-[18], the Full Court of the Federal Court held that a question of law brought forward under s 44(1) of the AAT Act must be stated with precision and must be specified separately from the grounds relied upon in support of the order sought on the appeal.

53. In addition, the Federal Court has held that, where an appeal lies "... on a question of law ..." under s 44(1), the subject of the appeal is the question of law brought forward. That is what must be determined by the Court. It is only after the question or questions have been determined that consideration needs to be given to the consequences of that determination by, for example, the Court exercising the powers given to it by subs (7) to (10) of s 44 (Comcare v Etheridge [2006] FCAFC 27; (2006) 149 FCR 522 at 527 [13]-[17] per Branson J with whom Spender and Nicholson JJ agreed, and the cases cited therein).

54. Much of the Federal Court jurisprudence in respect of s 44(1) of the AAT Act addresses the meaning of "question of law" and the difference between "a question of law" and "a question of fact". In the present case, given that s 79(3) refers to "... question of fact or law ...", the distinction between the two concepts is not important. One question that may arise is whether a question of mixed fact and law is within the expression "... a question of fact or law ..." in s 79(3). My tentative view is that a question of mixed fact and law would fall within that expression but I do not need to decide that question in order to determine the present case and I expressly refrain from doing so.

55. In my view, s 79(3) of the ACAT Act is intended to provide to a disappointed party before ACAT a right to have a first instance decision of ACAT reconsidered by an appellate bench within ACAT or, through the mechanism of removal provided for in s 83, to have such a decision reconsidered by this Court. As is the case with an "appeal" under s 44(1) of the AAT Act, a s 79(3) appeal is, strictly speaking, not an appeal at all. It provides for a limited reconsideration of the first instance decision of ACAT by means of the determination of one or more questions of fact or questions of law. These questions must be precisely formulated in the appeal application. These questions will be the subject matter of the appeal. Once they have been determined, the Court can give consideration to the appropriate orders to be made in light, in particular, of the specific powers given to it by r 5052 CPR.

56. The views which I have expressed at [34]-[55] above differ in some important respects from the interpretations given to the relevant provisions by Refshauge J in Legal Practitioner v Council of the Law Society of the ACT (2011) 257 FLR 118 and by Penfold J in O'Donnell v Environment Protection Authority [2012] ACTSC 140; (2012) 192 LGERA 1; (2012) 268 FLR 48. I am not bound to follow the reasoning in either of those decisions. With great respect to their Honours, for the reasons which I have explained, I have found it necessary to some extent to depart from that reasoning.

57. In the present case, PAAN did not approach its appeal in the manner required by the ACAT Act and the CPR.

58. None of the questions which it formulated in its Appeal Application was formulated with precision nor are any of those questions susceptible of being truly characterised as being the subject of the appeal itself.

59. Confronted with the difficulties posed for the Court by the formulation of the questions of fact or law made by PAAN in its Appeal Application, PAAN articulated other different questions at the hearing before me. It did so in a document headed "Questions of Law, Questions of Fact". In that document, PAAN did not specify which particular questions were said to be questions of law and which were said to be questions of fact. The questions set out in that document are:

Was ACAT entitled to take into account the actions of Peter Georgiou after he ceased to be a director of PAAN Investments Pty Ltd for the purposes of determining whether an extension of time should be granted to PAAN under section 103 of the Taxation Administration Act 1999?

Did PAAN have an acceptable excuse for not objecting within the 60 day time period?

Did ACAT place undue weight on the actions of Mr Georgiou when determining whether PAAN had an acceptable excuse for not objecting within 60 days?

60. Both parties addressed submissions as to the nature of the matter with which I am currently dealing.

61. PAAN contended that the Court had the same discretionary power to decide for itself the nature of the appeal as ACAT has under s 82 of the ACAT Act. This submission was founded upon the proposition that s 82 is engaged the moment an appeal is filed. PAAN then submitted that, in the circumstances of the present case, the Court should elect to proceed under s 82(b) of the ACAT Act and should bring its own judgment to bear on the questions of fact and law raised by PAAN and to determine what is the correct or preferable decision for the disposition of PAAN's appeal. PAAN went on to submit that the Court was not required to find error in the ACAT decision in order to overturn that decision.

62. The Commissioner submitted that it was s 79(3) of the ACAT Act which gave the right to PAAN to appeal from ACAT's decision of 16 April 2012. The Commissioner then submitted that, for the purposes of s 79(3), the questions brought forward by the appellant must arise from the first instance decision of ACAT appealed from. He said that it is the formulation of those questions which determines the scope or subject matter of the appeal. The Commissioner went on to submit that, in substance, an appeal under s 79(3) was tantamount to a rehearing. It is an appeal on identified issues set out in the questions of fact or law by which error in the original decision must be shown. The Commissioner submitted that s 82 only came into play once the questions of fact or law posed pursuant to s 79(3) had been determined. That is, s 82 would only become relevant if the appeal was successful.

63. It is obvious from what I have said from [34]-[56] above that I favour the Commissioner's submissions although, for reasons which I have already explained, I do not think that s 82 gives powers and discretions to the Court itself. It may well be that the Commissioner is correct in his submission that the appeal tribunal is only authorised to have resort to s 82 after it has upheld the appeal.

64. Despite the fact that Counsel who appeared for PAAN reformulated the questions of fact and/or law which PAAN wished to pose as the subject matter of its appeal, he nonetheless addressed the Court more by reference to his Written Submissions than by reference to those questions. For this reason, I will look at the substance of PAAN's case. This is not to say that I accept that PAAN brought forward properly formulated questions for determination by the Court under s 79(3) of the ACAT Act. In my view, it did not do so. However, I prefer to determine the present case upon the assumption that PAAN has brought forward questions which allow it to argue the points which it did, in fact, argue.

65. As is clear from my summary of the ACAT decision under appeal at [24]-[30] above, ACAT approached the application before it upon the basis that s 103 of the TAA gave to the Commissioner (and thus ACAT) an unconfined discretion to extend, or refuse to extend, the time within which a dissatisfied taxpayer might lodge an objection being a discretion which is constrained only by such matters as may be gleaned from the subject matter, scope and purpose of the TAA. This was plainly the correct starting point for ACAT's consideration of the matter before it.

66. ACAT then moved to consider the application against the guidelines articulated by Wilcox J in Hunter Valley Developments Pty Ltd v Cohen. Again, there was nothing wrong with this approach in principle. Indeed, both parties approached the matter by reference to that decision when arguing the case before ACAT.

67. In its submissions before me, PAAN contended that ACAT made errors of principle by not adequately or properly directing its attention to PAAN's reasons for delay and its circumstances. In particular, PAAN contended that, because Mr Georgiou had ceased to be a director of PAAN before the time limit for the lodgment of an objection to the assessment had expired, he had no control over PAAN after ceasing to be a director and no standing to lodge an objection on its behalf. For this reason, PAAN submitted that Mr Georgiou's actions or omissions were not relevant at all. It then submitted that it was an error for ACAT to look at Mr Georgiou's circumstances after the appointment of the liquidator and to hold those matters against PAAN. It was said that this was not only an error of principle but had worked a serious injustice against PAAN in the circumstances of the present case.

68. In addition, in its Written Submissions, PAAN identified a second error of principle. It submitted that ACAT had put too much store in the need for there to be an explanation for delay before the discretion reposed in the Commissioner under s 103 of the TAA could be enlivened. PAAN submitted that ACAT treated the need for an explanation for the delay as a pre-condition to the exercise of the discretion and that this was an error of law.

69. In his submissions, the Commissioner reminded the Court that the subject matter of PAAN's appeal was an exercise of a discretion pursuant to a specific statutory provision (s 103 of the TAA). He submitted that, for this reason, the principles articulated by the High Court in House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504-505 per Dixon, Evatt and McTiernan JJ were applicable.

70. Senior Counsel for the Commissioner then submitted that ACAT was not guilty of an overly rigid approach to the guidelines propounded by Wilcox J in Hunter Valley Developments Pty Ltd v Cohen but rather placed appropriate emphasis upon the simple proposition that there was no satisfactory explanation for the inordinate delay on the part of PAAN in making its application for permission to lodge an objection to the assessment out of time.

71. The principles in House v The King do not have direct application to an appeal under s 79(3) of the ACAT Act. The only matter akin to the ideas which find expression in House v The King raised by PAAN in the present case is its assertion in its Appeal Application that ACAT's decision was so unreasonable that no reasonable decision- maker could have made it. No attempt was made to make good that proposition.

72. The Court is unlikely to interfere in the exercise of a generally unfettered discretion by an administrative decision-maker unless that decision-maker took into account factors which could not conceivably have any relevance to the making of the decision or otherwise in some way applied a wrong principle. Here, the complaint is that ACAT took into account the fact that Mr Georgiou took no steps to ensure that PAAN lodged an objection against the assessment within time in the period from 3 November 2004 to 22 December 2004 (a period of seven weeks) and did nothing thereafter to encourage or ensure that the liquidator of PAAN lodged such an objection within time or, at the very least, promptly sought an extension of time for the lodging of such an objection.

73. In my judgment, the matters which ACAT took into account in coming to its decision to confirm the Commissioner's refusal to grant an extension of time were all matters which it was entitled to take into account. In particular, ACAT was entitled to regard a period of almost six years as an inordinate and unacceptable delay for the making of an application for an extension of time pursuant to s 103 of the TAA. It was also entitled to regard the explanation for that delay proffered by PAAN (viz that the liquidator had no funds with which to lodge and prosecute an objection or to pay the outstanding tax and that Mr Georgiou was entitled to sit by and do nothing until the prospect of his being personally liable arose once again) as unacceptable in circumstances where, had it been important to him, Mr Georgiou could have taken steps to put the liquidator in funds and to otherwise assist him in order to make an appropriate extension of time application. It should not be forgotten that this is exactly what has now happened by the bringing of the original review application in ACAT and the subsequent appeal from ACAT's decision in that application. As is obvious, when the spectre of personal liability arose in 2009, Mr Georgiou was apparently then in a position to persuade the liquidator to proceed to seek the necessary extension by the means which I have outlined. It must be said, however, that even then, Mr Georgiou was in no hurry. The Federal Court proceedings were commenced on 21 August 2009 but it took yet another year for PAAN to informally seek an extension of time from the Commissioner and another four months for it to do so formally.

74. Even if an appropriate question of fact or law had been brought forward by PAAN in order to raise its complaint before this Court based upon ACAT's consideration of Mr Georgiou's actions and omissions, I am not at all persuaded that there is any relevant error that would engage this Court's power to interfere with ACAT's decision.

75. As far as PAAN's second complaint to which I have referred at [68] above is concerned, a fair reading of ACAT's Reasons for Decision demonstrates that there was no rigid application of Guideline 1 articulated by Wilcox J in Hunter Valley Developments Pty Ltd v Cohen. Rather, ACAT placed significant weight upon the fact that the delay in the present case was inordinate and was the result of deliberate and conscious actions on the part of the liquidator of PAAN and Mr Georgiou, the latter believing that he could not be made personally liable for the unpaid payroll tax and the former taking no action either because he had no funds to do so or because there was no reason to do so. Again, there is no merit in this criticism of ACAT.

76. PAAN has failed to bring forward any questions of law or fact for consideration by this Court. PAAN has brought forward two broad complaints about ACAT's decision. Whether or not those complaints can be properly characterised as questions of fact or law within the meaning of that expression in s 79(3) of the ACAT Act, neither of those complaints has any merit. It follows that the appeal removed to this Court pursuant to s 83(2) of the ACAT Act must be dismissed. Costs should follow the event.

78. Neither the liquidator of PAAN nor Mr Georgiou has offered to pay all or part of the outstanding payroll tax as a condition of being allowed to object to the assessment so long after it was issued. I have the impression that both PAAN and Mr Georgiou take the view that PAAN should be granted the indulgence which it seeks without having to pay the disputed tax. Even if I were minded to allow the appeal and to permit PAAN now to object to the assessment, I would only do so upon terms that all of the outstanding tax, penalties and interest be paid. Given that I have decided to dismiss the appeal, the question of conditions to be imposed in the event that the appeal were successful, does not arise.

I certify that the preceding seventy-eight [78] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Foster.