Swiss Aluminium Australia Ltd v Commissioner of Taxation

The first respondent, the Commissioner of Taxation ("the Commissioner"), objected to the competence of this appeal on the ground that the decision of the Full Court of the Federal Court from which the appeal is brought is not a judgment of that Court within the meaning of s. 33(1) of the Federal Court of Australia Act 1976 Cth and is not a judgment, decree or order within the meaning of the expression "judgments, decrees, orders" in s. 73 of the Constitution. The term "judgment" in the Federal Court of Australia Act is defined by s. 4 of that Act to mean "a judgment, decree or order". We upheld the objection, dismissed the appeal as incompetent and ordered the appellant to pay the respondents' costs, announcing that the reasons for the decision would be published at a later date.

The appellant was assessed to income tax under s. 136 of the Income Tax Assessment Act 1936 Cth. That assessment was made on the footing that the appellant, a wholly owned subsidiary of a foreign company, Swiss Aluminium Ltd., derived less taxable income from its business than it would have derived if it were not subject to foreign control. At the core of the assessment was the Commissioner's calculation of the price or value of the alumina supplied by the appellant to its parent company, Swiss Aluminium Ltd. The appellant appealed against the assessment. In connexion with its appeal the appellant was concerned to ascertain how the Commissioner came to calculate the prices at which he claimed the appellant should be selling its alumina for the purpose of assessing the appellant to income tax.

With this end in view, the appellant on 20 July 1984 requested access under s. 15 of the Freedom of Information Act 1982 Cth ("the F.O.I. Act") to all documents in the Commissioner's file relating to the appellant's assessment to income tax for the years ended 31 December 1976 to 1979 inclusive. The Commissioner failed to comply with this request within the time limited by the F.O.I. Act (s. 19(1)) so that, by force of s. 56 of the F.O.I. Act, the Commissioner was deemed to have denied access. The appellant then made application under s. 29(1) of the Administrative Appeals Tribunal Act 1975 Cth ("the A.A.T. Act") to have the Commissioner's refusal to grant access reviewed by the Administrative Appeals Tribunal ("the Tribunal"). The Commissioner produced a long list of documents claiming that they were exempt documents under ss. 36, 37(1)(a), 37(1)(b), 37(2)(b), 38, 40(1)(c), 40(1)(d), 40(1)(e), 43(1)(c) and 45 of the F.O.I. Act. Where a document consisted partly of exempt material the Commissioner prepared a copy of the document with the exempt material deleted pursuant to s. 22 of the F.O.I. Act.

The parties agreed to take one document D79 as a vehicle to test the various claims for exemption made by the Commissioner. This document, described as "Report by Advising Officer 31.5.84", contained the recommendation to make the assessment. The Commissioner claimed exemption for it under all the exemption provisions mentioned above except ss. 36 and 45. The Commissioner's claim for exemption of the document under s. 38 was dealt with initially and separately, notwithstanding that exemption for it was also claimed on other grounds.

A document is an exempt document if there is in force an enactment applying specifically to information of a kind contained in the document and prohibiting persons referred to in the enactment from disclosing information of that kind, whether the prohibition is absolute or is subject to exceptions or qualifications.

The Tribunal (Beaumont J., Mr. Sinclair and Dr. Renouf) held that D79 was not exempt from disclosure under s. 38 and to that extent set aside the decision under review. However, noting that the other grounds for exemption had not yet been argued, the Tribunal declared that the appellant be not granted access until further order.

The Commissioner sought to appeal to the Full Court of the Federal Court. The Full Court held that it lacked jurisdiction to entertain the appeal and referred the matter back to the Tribunal which then proceeded to state a special case under s. 45(1) of the A.A.T. Act referring to the Full Court the following question:

Whether the document marked in the proceedings as D79 is an exempt document pursuant to the provisions of s. 38 of the Freedom of Information Act 1982 on the ground that s. 16 of the Income Tax Assessment Act 1936 is an enactment applying specifically to information of a kind contained in the document and prohibiting persons referred to in the enactment from disclosing information of that kind.

The Full Court by majority (Bowen C.J. and Jackson J., with Fox J. dissenting), disagreeing with the Tribunal's decision, answered the question in the special case in the affirmative and made an order for costs in favour of the Commissioner. The effect of the Full Court's answer to the question in the special case is dealt with by s. 45(3) of the A.A.T. Act. It provides:

Where a question of law arising in any proceeding has been referred to the Federal Court of Australia under this section, the Tribunal shall not, in that proceeding -

(a) give a decision to which the question is relevant while the reference is pending; or

(b) proceed in a manner, or make a decision, that is inconsistent with the opinion of the Federal Court of Australia on the question.

The appellant submits that the effect of the decision of the Full Court was to finally determine the rights of the appellant and thus to constitute an order within the meaning of s. 73 of the Constitution and s. 33 of the Federal Court of Australia Act. According to the appellant, the practical effect of the decision, which was binding on the parties, was that the document was an exempt document under s. 38. To that extent there was, so the argument proceeds, a final determination of the appellant's rights so far as they turned on s. 38.

It is well settled that an order must finally determine the rights of parties before it will qualify as an order within the meaning of s. 73 of the Constitution and s. 35 of the Judiciary Act 1903 Cth: Smith v Mann [1] ; Minister for Works (WA) v Civil & Civic Pty Ltd [2] ; Yule v Junek [3] ; Fisher v Fisher [4] . Thus, a distinction has been drawn between answers given to questions in a stated or special case which determine the rights of the parties (Smith v Mann ), and answers to a stated or special case which are advisory or consultative only: Minister for Works (W.A.) v Civil & Civic Pty. Ltd. The former, but not the latter, constitute an order within the meaning of s. 73 and s. 35. The same may be said of s. 33 of the Federal Court of Australia Act.

1. (1932) 47 C.L.R. 426, at pp. 445-446. 2. (1967) 116 C.L.R. 273, at pp. 277-279, 281, 285-286, 288-290. 3. (1978) 139 C.L.R. 1, at p. 14. 4. (1986) 161 C.L.R. 438, at pp. 449-451.

The appellant submitted that, in consequence of s. 45(3) of the A.A.T. Act, when the matter goes back to the Tribunal, the Tribunal has no alternative but to refuse access to the document. This submission does not take account of s. 58(1) and, more importantly, s. 58(2) of the F.O.I. Act. These sub-sections provide:

(1) Subject to this section, in proceedings under this Part, the Tribunal has power, in addition to any other power, to review any decision that has been made by an agency or Minister in respect of the request and to decide any matter in relation to the request that, under this Act, could have been or could be decided by an agency or Minister, and any decision of the Tribunal under this section has the same effect as a decision of the agency or Minister.

(2) Where, in proceedings under this Act, it is established that a document is an exempt document, the Tribunal does not have power to decide that access to the document, so far as it contains exempt matter, is to be granted.

Section 58(2) draws a distinction between an exempt document and exempt matter in an exempt document. The distinction is reflected in the statutory definitions in s. 4 of the F.O.I. Act. "Exempt document" is relevantly defined to mean "(a) a document which, by virtue of a provision of Part IV, is an exempt document". "Exempt matter" is defined to mean "matter the inclusion of which in a document causes the document to be an exempt document". Section 58(2) recognizes that the effect of establishing that a document is to be classified as an exempt document does not necessarily offer immunity from access to the entirety of the document. Indeed, s. 22 makes this clear. In conformity with this approach, once it is established that a document is an exempt document, s. 58(2) merely denies to the Tribunal power to grant access to exempt matter in that document. The Tribunal is therefore at liberty to grant access to so much of the exempt document as does not contain exempt matter and to this end the Tribunal may exercise the power given by s. 58(1).

Thus, in the present case, the effect of the Full Court's decision was to establish that D79 was a document to be classified as an exempt document. But the decision did not determine that the appellant had no right of access to the document. The making of such a determination depended on a decision that the document contained no matter other than exempt matter. The Full Court not having considered this question, it was for the Tribunal to deal with it when the Tribunal took up the reference back from the Full Court.

The appellant submitted that it was highly unlikely that any such question could arise before the Tribunal because the Tribunal, when it decided to hear the claim for exemption under s. 38 separately, appeared to have proceeded on the footing that that claim applied to the entirety of the deleted portions of the copy of D79 given to the appellant. In these circumstances, according to the appellant's argument, the Full Court's decision finally determines the appellant's rights.

We accept that the question whether an order finally determines the rights of a party is one which must be resolved in a practical way. It would be wrong to adopt an unduly technical approach by insisting on the taking of a further purely formal step in the proceedings for the sake of achieving mere technical finality where in every practical sense finality already exists. However, in the present case, the Full Court's decision does not finally determine the appellant's right of access to the document. The question whether all the matter deleted from the copy of D79 made available to the appellant is exempt matter remains outstanding. The fact that it is highly likely that there will be little or no debate about this question and that in all probability it will be resolved adversely to the appellant is not to the point. Until the Tribunal answers this question and determines that the appellant has no right of access to the document finality is not achieved.

It is for these reasons that we upheld the objection to competency and dismissed the appeal as incompetent.