AUCKLAND CHRISTIAN FELLOWSHIP & RECREATIONS v THE COMMISSIONER OF INLAND REVENUE [2020] NZHC 1301

AUCKLAND CHRISTIAN FELLOWSHIP & RECREATIONS v THE COMMISSIONER OF INLANDREVENUE [2020] NZHC 1301 [16 June 2020]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2019-404-2710[2020] NZHC 1301UNDER Section 26A of the Taxation ReviewAuthorities Act 1994IN THE MATTER OF The Goods and Services Tax Act 1985BETWEEN AUCKLAND CHRISTIAN FELLOWSHIP& RECREATIONSAppellantAND THE COMMISSIONER OF INLANDREVENUERespondentOn the papers: At AucklandJudgment: 16 June 2020JUDGMENT OF POWELL JThis judgment was delivered by me on 16 June 2020 at 3.30 pm pursuant toR 11.5 of the High Court RulesRegistrar/Deputy RegistrarDate:[1] The appellant, an incorporated society, has appealed a decision of the TaxationReview Authority ("TRA") confirming GST amounts owing and shortfall penalties.1[2] The appeal was filed by a Mr S K Pillai. At the first call of this appealMr Pillai's authority to file the appeal was queried by Mr Goosen on behalf of therespondent Commissioner. It transpired that Mr Pillai, a former trustee of theappellant, had in fact recently passed away and that alternative representation wouldbe required. As a result I issued directions providing for the appellant to either appointa solicitor to act for it on the appeal or to make a formal application seeking some sortof non-legal representation.[3] The appellant subsequently filed an "application for non-legal representation".This sought approval for Mr S Devathasan; the appellant's primary witness before theTRA, a non-lawyer, and Mr Pillai's son, to represent the appellant on the appeal. Onbehalf of the appellant Mr Devathasan submitted:(a) Mr Pillai had considered that Mr Devathasan was the "most suitableand knowledgeable person to present the case in the High Court";(b) "the instructed solicitor [in the TRA] found it very difficult tounderstand the full background [and] As a result many of the factswere not presented correctly";(c) the appellant "is in an extremely difficult financial situation and non-legal representation will assist the trust financially very significantly";(d) "the issues involved are straight forward and can be considered withoutthe assistance of legal representation";(e) in presenting the appeal Mr Devathasan would "have the full supportand guidance from voluntary lawyers"; and1 Auckland Christian Fellowship & Recreations v Commissioner of Inland Revenue [2019] NZTRA6.(f) Mr Devathasan would "undertake to meet all the High Courtrequirements of all rules and present [the] case completely as a thirdparty similar to a solicitor as if [he] were not involved in any of theactivities, but to purely discuss the previous judgment against theevidence submitted and the findings from the District Courtproceedings".[4] In response Mr Goosen submitted the application is contrary to the settledcommon law position as set out by the Court of Appeal in Re J G Mannix Limitedthat:2(a) A corporation has no right to be represented in the conduct of a case inCourt except by a barrister or solicitor.3 However, Courts have aresidual discretion to allow unqualified advocates to appear beforethem.4(b) Apart from statutory exceptions, a corporation has no right to bring orcarry on proceedings in Court except by a solicitor. This refers to thefiling of pleadings and other documents.5[5] Mr Goosen submitted that there are no exceptional circumstances in this casethat warrant the Court to depart from the rule in Mannix. In Mr Goosen'ssubmission:This is not an emergency matter where counsel is not available, orsuch a straight forward matter that the Court would not be assisted bycounsel, or a situation where it would be unduly technical orburdensome to insist on counsel.[6] As well as pointing out that this is a technical appeal which requires theapplication and interpretation of various provisions in the GST Act 1985 andTax Administration Act 1994, Mr Goosen submitted:2 Re J G Mannix Limited [1984] 1 NZLR 309 (CA).3 At [310].4 At [314].5 At [311].In addition, the policy reasons identified by the Courts for the Mannix ruleapply to this application. An independent solicitor would be ethicallyconstrained to represent the Trust's interests and objectively assess the meritsof the appeal. However, there is a real risk that Mr Devathasan will not be ina position to assist the Court in the same manner as counsel who would havean overriding duty to the Court. Mr Devathasan has a strong personal interestin the case. His own financial position is adversely affected by the TRAdecision because the majority of the Trust's income is passed through to himin the form of rent. He is the landlord and principal creditor of the Trust.Although Mr Devathasan was the sole witness for the Trust in the TRA, heinappropriately blames the solicitor that represented the Trust for the adversefactual findings that were made. The true position is that his evidence wasrejected in a number of key respects. He would be required to analyse his ownevidence and address the Court on the TRA's reasons for rejecting it andfinding it not to be plausible. This would clearly raise objectivity issues.Mr Devathasan's assertion that his knowledge of background facts makes himbetter equipped "than any solicitor" to present the appeal indicates a lack ofinsight, objectivity and understanding of the appeal process, and therefore aninability to assist the Court in carrying out its appellate function. He seems tolack an appreciation of not being permitted to give further evidence or amendevidence on appeal.Mr [Devathasan] asserts an intention to use the appeal process to see that thenames of the Trust and his late father are "cleared in the eyes of the law". Tosupport the Trusts tax position, Mr Devathasan refers to everyone that wasinvolved as being "law-abiding Christians" who sacrificed their time andmoney for the benefit to the community. These assertions all indicate aninappropriate subjective emotive focus on matters that will not assist the Courtin deciding the issues on appeal.Mr Devathasan claims that non-legal representation will assist the Trustfinancially. However, proceeding with the appeal without objectiveprofessional legal advice puts the Trust at risk of an adverse costs order as wellas continuing to incur use of money interest on its unpaid GST debts.[7] Finally, Mr Goosen noted that the appellant had already made a number ofprocedural errors with regard to the prosecution of the appeal to date to support thesubmission that it was inappropriate to continue to rely upon non-legally qualifiedrepresentation.Discussion[8] The matters raised by the Commissioner are compelling and entirelyunanswered. It is clear for all of the reasons stated by the Commissioner, thatMr Devathasan does not properly understand the role of counsel, nor is he equippedto properly represent the appellant in the appeal or to otherwise assist the Judgehearing the appeal. Given this position I have no hesitation in declining theapplication.Decision[9] The application for non-legal representation is declined. Should the appellantwish to proceed with the appeal it will have to instruct legal counsel. The appeal isadjourned back to the appeals list to be held at 9 am on 23 June 2020 to give theappellant the opportunity to instruct counsel and to liaise with the Commissioner overan appropriate timetable for the hearing of the appeal.[10] The Commissioner is entitled to costs on the application on a 2B basis. In theevent that there is any dispute arising I will determine the issue after receivingmemoranda._______________________________Powell J