Brown v Brown [2007] FCA 2073

Brown v Brown [2007] FCA 2073

The Notice to Pay Money issued pursuant to s 260-5 of Schedule 1 to the Taxation Administration Act 1953 (Cth) was effective, as BJT Legal Pty Ltd held money on account of A Chaid Pty Ltd. The Commissioner did not surrender the security interest created by the Notice by lodging a proof of debt that did not refer to the security, as this was not unequivocal conduct constituting an election to surrender; and the Notice pre-dated the winding up, so s 468 of the Corporations Act did not render it void.

Parties
Applicant: Trevor John Brown; First Respondent: Anne-Maree Brown; Second Respondent: Lawrence McAllion; Third Respondent: A Chaid Pty Ltd; Intervener: Deputy Commissioner of Taxation
Jurisdiction
Australia
Judgment Date
18 December 2007
Procedural Posture
Application / Judgment
Outcome
Application granted
Legal Topics
Income Tax Collection, Recovery From Third Party, Effect of Third Party Tax Notice, Statutory Charge, Priority in Liquidation, Doctrine of Election, Proof of Debt, Security Interest, Agreed Statement of Facts
Taxes and Duties Corporations Evidence Income Tax Collection Recovery From Third Party Effect of Third Party Tax Notice Statutory Charge Priority in Liquidation +4 more

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Parties

Trevor John Brown

Applicant

Anne-Maree Brown

First Respondent

Lawrence McAllion

Second Respondent

A Chaid Pty Ltd

Third Respondent

Deputy Commissioner of Taxation

Intervener

Procedural Posture

Application / Judgment

Legal Issues

  1. 1 Whether the third-party tax notice issued under s 260-5 of Schedule 1 to the Taxation Administration Act 1953 (Cth) was effective
  2. 2 Whether the Commissioner surrendered any security interest by lodging a proof of debt that did not refer to the security interest
  3. 3 Whether the funds held by BJT Legal Pty Ltd were held for or on account of A Chaid Pty Ltd for the purposes of the Act

Ratio Decidendi

The Notice to Pay Money issued pursuant to s 260-5 of Schedule 1 to the Taxation Administration Act 1953 (Cth) was effective, as BJT Legal Pty Ltd held money on account of A Chaid Pty Ltd. The Commissioner did not surrender the security interest created by the Notice by lodging a proof of debt that did not refer to the security, as this was not unequivocal conduct constituting an election to surrender; and the Notice pre-dated the winding up, so s 468 of the Corporations Act did not render it void.

Court Disposition

Application granted

Orders

  • BJT Legal Pty Ltd to pay $244,248.45 from account 633/000 128949658 at Bendigo Bank Limited to the Commissioner of Taxation under Notice to Pay issued 19 October 2006.
  • The costs of and incidental to this application to be costs in the liquidation of A Chaid Pty Ltd (in liquidation) (ACN 109 374 727).