Collector of Customs v Bathox Pty Ltd [2002] FCA 1581

FEDERAL COURT OF AUSTRALIA

Collector of Customs v Bathox Pty Ltd [2002] FCA 1581 CUSTOMS & EXCISE – claim by Collector that the respondent had failed to "account" to satisfaction of Collector under Excise Act 1901 (Cth) s 60 – undertaking by Collector to provide audit report alleged by respondent – whether injunction available to restrain Collector from bringing proceedings where delay in making allegation. Excise Act 1901 (Cth)

Project Sky Blue Inc v Australian Broadcasting Authority (1998) 194 CLR 355 cited COLLECTOR OF CUSTOMS V BATHOX PTY LIMITED NO. N 265 OF 2001 BEAUMONT J 12 DECEMBER 2002 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 265 OF 2001

BETWEEN: COLLECTOR OF CUSTOMS

APPLICANT

AND: BATHOX PTY LIMITED

RESPONDENT

JUDGE: BEAUMONT J

DATE OF ORDER: 12 DECEMBER 2002

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. No formal orders be made. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 265 OF 2001

BETWEEN: COLLECTOR OF CUSTOMS

APPLICANT

AND: BATHOX PTY LIMITED

RESPONDENT

JUDGE: BEAUMONT J

DATE: 12 DECEMBER 2002

PLACE: SYDNEY

REASONS FOR JUDGMENT BEAUMONT J:

Introduction 1 There remains one further issue to be resolved in these proceedings. That is the issue tendered by pars 3(i)(d) and (e) of the defence which is purportedly an answer to par 11 of the applicant's further amended statement of claim. Sub-pars (d) and (e) should be read in conjunction with sub-par (c) as follows: "(c) The Respondent by letter dated 29 October 1998 denied any shortfall and through its solicitors made several requests for the Applicant to supply particulars of the audit so that the cause of the discrepancy could be ascertained. (d) In associated proceedings brought by a servant of the Applicant in the Local Court against the Respondent for the retention of certain goods and business records seized by Customs officers during the aforesaid audit, the said servant of the Applicant undertook to the Respondent to supply the particulars of the audit; (e) Notwithstanding several requests made in writing by the Respondent through his legal advisers, and the undertaking given by the servant of the Applicant, no such particulars were supplied prior to the commencement of these proceedings;" 2 I have allowed the respondent to re-open its case in order to prove the terms of the "undertaking" pleaded in sub-par (d). In that connection, the respondent has read the affidavit of its solicitor, Mr Khoury, sworn 11 December 2002, in which Mr Khoury says: "3. On 22 December 1998, I appeared for the Respondent at the St James Local Court before Magistrate Malcolm Beveridge. Mr Robert Bromwich of counsel appeared for the Applicant. Annexed hereto and marked 'A' is a copy of my Notice of Appearance. Annexed hereto and marked 'B' is a copy of Mr Bromwich's Notice of Appearance. 4. Prior to the hearing, I held discussions with Mr Bromwich with a view to facilitating the court process and coming to some terms in order to save time and costs. 5. I said to Mr Bromwich words to the following effect: 'My client will consent to your application for an extension of time if your client undertakes to supply the particulars of your client's audits and supply an explanation regarding the papers that have been returned to us'. 6. I then observed Mr Bromwich apparently seeking and obtaining instructions from the Applicant, Mr Chapman, who was present at the hearing. Mr Bromwich then gave the undertaking to supply particulars of the audit and an explanation regarding the papers by 11 January 1999. Annexed hereto and marked 'C' is a copy of a contemporaneous note of such made by me. 7. The court then made the order for the seized material to be retained by the Applicant until 5 May 1999. Annexed hereto and marked 'D' is the relevant page of the court file noting the order made. 8. I caused a search of the office file which located entries in my time costing sheets. Annexed hereto and marked 'E' is copy of timesheet written by myself in relation to the court proceedings on 22 December 1998 written that same day." 3 Objection was taken on behalf of the Collector of Customs ("the Collector") to the second sentence of par 6 of the affidavit. Over objection, I permitted Mr Khoury to give oral evidence, in proper form, of the conclusion purportedly stated in the second sentence of par 6. 4 Mr Khoury then gave evidence that Mr Bromwich said to him on the occasion in question: "They [the Australian Customs Service ("Customs")] will give you a copy of the audit once it is completed, and any relevant working papers". 5 As has been seen, in par 6, reference is made to a copy of a contemporaneous note made by Mr Khoury at the time. This consists of a handwritten note written by Mr Khoury on the Court list before the Magistrate on 22 December 1998. The following there appears (in Mr Khoury's handwriting): "1 Particulars of audit papers – 11/1/99. 2 Explanation and reasons – 11/1/99. 1 Audit Report. < 2 We dispute discrepancy < 3 Time extention [sic] - < 4 Difficulties with Business.." 6 As has also been seen, Mr Khoury annexed to his affidavit as annexure "D", the Court file note of the order made. It records the following: "Order that things seized may be retained until 5/5/99". There is, however, no undertaking noted by the Magistrate on the Court record. 7 Annexure "E" to the affidavit of Mr Khoury shows, relevantly, the following: "CLIENT No. TIME CODE PARTICULARS Bathox 8464 20 3 St. James Court – Magistrate Beveridge - - - 2 R. Bromwich – for ACS - - - 2 17 Kath Wray – Re Court orders and - - - - Undertakings and possible Demands. - - 1 17 G. Wray – Re Orders & Undertakings"