PRACTICE AND PROCEDURE - application for review - stay order in effect - Applicant failed to appear at hearing - clients' tax affairs - application dismissed

Administrative Appeals Tribunal Act 1975 - ss. 41, 42A

Taxation Administration Act 1953 - s. 8C

1. At the hearing of the above matter the terms of the order and the reasons for that order were stated orally. Following the delivery of the order, the Respondent requested the Tribunal to furnish to the Respondent a statement in writing of the reasons of the Tribunal for its order.

The oral reasons for the order have been transcribed by Auscript, the Commonwealth Reporting Service. Although the oral reasons given may reflect the inelegance of an extempore order, they are in fact the reasons for the said order.

3. The said transcript is annexed hereunto and furnished to the Applicant and to the Respondent as the reasons for the Tribunal's order.

I certify that this and the preceding page are a true copy of the order and reasons for order herein of Mr J. Block, Deputy President.

Signed: A. Garcia

.............................................................................................................

Associate

Date of Hearing 7 April 2006

Date of Decision 7 April 2006

Representative of the Applicant No appearance

THE D.PRESIDENT: This is an extempore decision in matter number N2005/99 between Richard Keith Reichenbach as Applicant and the Tax Agent's Board of New South Wales as the Respondent. It is an extempore decision and I reserve the right to edit it in order to correct typographical or similar errors.

(1) The decision which is under review in this matter is the decision by the Respondent on 16 December 2004 and in which the Respondent determined that it should refuse the Applicant's application for re-registration as a tax agent.

(2) The Respondent was represented by Ms J. Maurer of the Australian Government Solicitor. The Applicant did not appear.

(3) The Tribunal had before it the "T documents" lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 ("the AAT Act"). It also received an amended Statement of Facts and Contentions by the Respondent dated 25 January 2006 which contains under the head of 'Facts' a useful chronology of relevant events. It is unnecessary for me to detail the content of the Respondent's Statement of Facts and Contentions under the head of Facts, but this decision should be treated as incorporating all of its content. It may be noted in particular that the Applicant was convicted under section 8C(1)(a) of the Taxation Administration Act 1953 of failure to lodge income tax returns for a number of years. It is also relevant to note that many of the clients of the Applicant complained about his neglect of their affairs. The content of that statement under the head of 'Facts' indicates that the Applicant's lodgement record was poor and that his manner of dealing with requests for information as to his endeavours and proposals in respect of rectification of his conduct were often delayed or not adhered to. I repeat though that this decision should be treated as incorporating the content of the Respondent's amended Statement of Facts and Contentions dated 25 January 2006 under the head of 'Facts'.

(4) On 24 January 2005 the Applicant sought the review of the relevant decision. He also applied for a stay order pending the resolution of his application and the Respondent granted his request.

(5) In the year which followed (2005) there were apparently conferences and delays (which need not be detailed) and the matter was eventually listed in January 2006 to be heard on 7 April 2006.

(6) On 3 April 2006 the Applicant emailed the Tribunal (addressed to Mr Andrew Garcia who is the associate in this matter) in the following terms:

"Mr Andrew Garcia,

Thank you for your time this morning.

As we discussed, I am due to go into hospital tomorrow for surgery in relation to my ongoing prostate cancer problem and also to have an internal examination as the recent tests by my Doctor show that I may also be developing testicular cancer.

Consequently I do not think I will be in either the correct physical or mental state to attend the AAT hearing scheduled for this coming Friday, 7 April 2006 at 10.00am.

I would ask that you ask the AAT District registrar, before whom I am listed, if my hearing could be adjourned until such time as I am fit enough to attend.

If you could let me know the outcome of your meeting with the Registrar it would be appreciated.

Thanking you

Keith Reichenbach"

(7) Mr Garcia contacted me on receipt of that email message in order to ascertain my views. I instructed him to contact Ms Maurer in order to ascertain the Respondent's views.

(8) Ms Maurer was contacted on the following day because she was in court on 3 April 2006, and was inclined to be sympathetic on the basis that a person would not claim that he had cancer unless that claim were true. Ms Maurer however said that the Respondent would neither agree to the vacation of the hearing date but at the same time would not disagree and would leave it up to the Tribunal as to what should be done. At the same time she raised the question of what would occur in relation to the Applicant's clients; she felt that it might be necessary to alter the stay order so as to allow it to continue conditionally upon the Applicant appointing some suitable person to take charge of his practice and attend to his client's affairs.

(9) Over the next two days a number of telephone conversations between Mr Garcia and the Applicant took place. The Applicant was informed that the Tribunal could not, without the Respondent's consent, simply vacate the hearing. He was informed that while the Tribunal was not unsympathetic as to his health condition it would require medical evidence supporting the statements set out in his email message.

(10) On 6 April 2006 the Applicant told Mr Garcia that while he could not attend the hearing himself a lawyer would represent him at the hearing. He promised also that a medical certificate would be sent to the Tribunal. Later that day he informed Mr Garcia that he had been unable to obtain legal representation but that he would be represented at the hearing by a colleague. He again promised that the Tribunal would receive medical evidence.

(11) The Applicant did not send any medical evidence to the Tribunal and he was not represented at the hearing. He did not contact Mr Garcia in order to inform him that he would not be represented and that he would not be sending any medical evidence.

(12) The email message in question refers to an "ongoing prostate cancer problem". On the basis that it was ongoing as the Applicant said, the Applicant would have known about it long before 3 April 2006, and which raises the question of why he left his request for vacation of the hearing until so late in the day and only four days prior to the listed hearing date.

(13) The Tribunal cannot of course in the absence of medical evidence express any view as to the Applicant's medical condition. It does not dispute the fact that the Applicant may well be suffering health problems of the nature described by him but wonders why, if that is so, it is not possible for him to submit evidence to that effect or on the assumption that it is possible why he did not do so. The Tribunal notes also that to vacate the hearing date as the Applicant requested on the basis that it would be heard when "I am fit enough to attend" would have the effect, having regard to the stay which is in force, that the decision would be nullified on an indefinite basis. The time taken from the date of the original decision is relevant in this context.

(14) Discussion took place at the hearing as to whether the stay should be revoked. The Tribunal has the power to do so under section 41(3) of the AAT Act. Section 41(4) of the AAT Act, in its terms, permits an alteration to a stay order but only if the applicant has been given a reasonable opportunity to make submissions to the Tribunal. In this case the Applicant has not for obvious reasons had such an opportunity. However, section 41(4) of the AAT Act is in its terms subject to section 41(5) of the AAT Act which reads as follows:

"Subsection (4) does not prohibit the Tribunal from making an order without giving to a person referred to in that subsection a reasonable opportunity to make a submission to the Tribunal in relation to a matter if the Tribunal is satisfied that, by reason of the urgency of the case or otherwise, it is not practicable to give that person such an opportunity but, where an order is so made without giving such an opportunity to the person who made the decision to which the relevant proceeding relates, the order does not come into operation until a notice setting out the terms of the order is given to that person."

(15) On one view of the matter an order revoking the stay under section 41(3) of the AAT Act might seem to be the preferable solution. There are a number of problems as to such an order. In the first place it is doubtful whether in all the circumstances and having regard to the delays which have already occurred, there is urgency as referred to in section 41(5) of the AAT Act. While it is true that that subsection refers, in its terms, to "the urgency of the case or otherwise" it might be that the words "or otherwise" should be construed ejusdem generis with the words "the urgency of the case". In the next place, the Tribunal does not know where the Applicant is; he told Mr Garcia that he is in a hospital somewhere outside Sydney and an order under section 41(3) of the AAT Act has effect only when notice is given to the Applicant. There is yet another consideration which is at least of equal importance and perhaps greater importance and which must not be disregarded. The service of such an order, assuming that this could be achieved at all, will not be notice to the Applicant's clients whose tax affairs might reasonably be supposed to be unattended. The Tribunal documents lodged under section 37 of the AAT Act include letters by disgruntled clients of the Applicant. One example will suffice; T5 is a letter dated 24 February 2004 addressed by Christine Bowman to the Tax Agents' Board reading as follows:

"Following my conversation with the Tax Agents' Board this morning, I would like to know if somebody could ring my Tax Agent, Keith Reichenbach, phone ... and see if he would please lodge my 2001-2002 Tax Return.

I have phoned him on numerous occasions in the last month and each time he tells me he'll do it in the next couple of days. I phoned him last on Friday 20 February, 2004 and he said he had done it.

I phoned Tax Department on the following Monday and they hadn't received it and again today, 24 February 2004.

I can't do this anymore, and my blood pressure is rising. I needed this information by today for Centrelink and still have not received it. I would also like my assessment forms he has not sent these to me either.

I don't feel I can talk to him anymore - it is too frustrating.

Can you please contact me... and advise me of what I can do next.

Yours sincerely,

Christine Bowman."

(16) It is in these circumstances that I consider that the proper course of action is to dismiss the application under section 42A(2) of the AAT Act. Such a course is open to the Tribunal because the Applicant did not appear either in person or through a representative at the hearing. That representative need not have been a lawyer; the Applicant might have been represented by a colleague or a friend or a relative. When an application is dismissed under section 42A(2), the applicant has the right under section 42A(8) of the AAT Act to apply to the Tribunal for reinstatement of the application. Under section 42A(9) of the AAT Act the Tribunal may reinstate the application if it appears to be appropriate to do so. It is unnecessary for me to refer to the case law referable to applications of this nature. The Tribunal was informed that a dismissal is notified and so that the Applicant's clients will become aware of the fact that they need to seek alternative representation.

(17) In the circumstances and for these reasons the application is dismissed pursuant to the provisions of section 42A(2) of the Administrative Appeals Tribunal Act 1975.