FEDERAL COURT OF AUSTRALIA Tax Practitioners Board v Buckland (No 2) [2023] FCA 191 File number(s): NTD 18 of 2022 Judgment of: HESPE J Date of judgment: 21 February 2023 Date of publication of reasons: 8 March 2023 Catchwords: HIGH COURT AND FEDERAL COURT – jurisdiction of the Federal Court – whether Court has jurisdiction PRACTICE AND PROCEDURE – application for service on a company in a foreign country – application for substituted service under r 10.24 and / or r 10.49 of the Federal Court Rules 2011 (Cth) as amended from 13 January 2023 Legislation: Federal Court of Australia Act 1976 (Cth) s 19 Federal Court Rules 2011 (Cth) rr 1.34, 8.11, 8.12, 9.05, 10.24, 10.45, 10.49 Judiciary Act 1903 (Cth) ss 39B, 78B Tax Agent Services Act 2009 (Cth) Cases cited: Austral Pacific Group Ltd (In liq) v Airservices Australia [2000] HCA 39; (2000) 203 CLR 136 Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd [1999] FCA 1151; (1999) 95 FCR 292 Australian Securities and Investment Commission v Edensor Nominees Pty Ltd [2001] HCA 1; (2001) 204 CLR 559 Chan v Harris (No 3) [2011] FCA 341 Deputy Commissioner of Taxation v State Bank (NSW) (1992) 174 CLR 219 Tax Practitioners Board v Buckland [2022] FCA 1376 Division: General Division Registry: Northern Territory National Practice Area: Taxation Number of paragraphs: 29 Date of hearing: 21 February 2023 Counsel for the Applicant: Mr M J Follett Solicitor for the Applicant: MinterEllison Counsel for the Respondent: The respondent appeared in person ORDERS NTD 18 of 2022 BETWEEN: TAX PRACTITIONERS BOARD Applicant AND: ANTHONY DEAN BUCKLAND Respondent order made by: HESPE J DATE OF ORDER: 21 February 2023 THE COURT ORDERS THAT: 1. Pursuant to r 9.05 of the Federal Court Rules 2011 (Cth), Apat na Seasons Pilipinas Corporation (the Company) be joined as a respondent to this proceeding. 2. Pursuant to r 8.21 of the Rules, the applicant have leave to amend the originating application dated 14 October 2022 in substantially the manner set out in the document marked "PAL-7" and annexed to the affidavit of Patrick Anthony Long affirmed on 24 January 2023 and filed in these proceedings (Amended Originating Application). 3. The applicant file (and serve on the respondent) the Amended Originating Application. 4. Pursuant to r 10.44 of the Rules, the applicant have leave to serve on the Company in the Philippines the following documents (Relevant Documents): (a) the affidavit of Mingma Sherpa affirmed 14 October 2022; (b) the affidavit of Melissa Guise affirmed 11 March 2022; (c) the affidavits of Aaron Cuerden affirmed 11 April 2022 and 5 October 2022; (d) the affidavit of Jennifer Ledingham affirmed 13 April 2022; (e) the affidavit of Alison Hawkins affirmed 27 April 2022; (f) the affidavit of Tom Cavallaro affirmed 26 May 2022; (g) the affidavits of Patrick Anthony Long affirmed 14 October 2022, 24 January 2023 and 31 January 2023; and (h) a notice in accordance with Form 26A to the Rules. 5. Pursuant to r 1.34 of the Rules, any requirement under r 10.49 of the Rules that there be unsuccessful attempts at service of any documents filed in these proceedings, including the Amended Originating Application and the Relevant Documents, be dispensed with. 6. Pursuant to r 10.24(a) or alternatively r 10.49(a) of the Rules, the applicant may serve any documents filed in these proceedings, including the Amended Originating Application and the Relevant Documents, on the Company by: (a) sending an electronic link to download and access any documents filed in these proceedings by email, addressed to the Proper Officer of the Company, at: (i) apatnaseasons@gmail.com; (ii) apatnaseasons@protonmail.com; (iii) apat_na_seasons@mailfence.com; and (iv) jmv@vcolaw.com; or (b) sending a copy of the documents in PDF form as attachments to one or more emails addressed to the "Proper Officer" of the Company at the email addresses specified in subparagraph (a). 7. The proceeding be listed for a case management hearing on a date not before 8 May 2023. 8. The parties have leave to attend the case management hearing referred to in paragraph 7 of these orders by way of web conference. 9. There be liberty to apply. 10. Costs be reserved. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT HESPE J: 1 On 3 November 2022, orders were made in the proceeding pursuant to r 10.43 and r 10.24 of the Federal Court Rules 2011 (Cth) relating to the service of the initiating documents in the proceeding on Mr Buckland, a person situated in the Philippines. The reasons for those orders were published as Tax Practitioners Board v Buckland [2022] FCA 1376. JURISDICTION 2 As those reasons record, it was necessary for the purposes of the relief sought pursuant to r 10.43 that the Court be satisfied (amongst other things) that it had jurisdiction in the proceeding (r 10.43(4)) and her Honour was so satisfied: Buckland at [18] and [19]. 3 During a case management hearing on 31 January 2023, the respondent submitted that he had not had an opportunity to address the Court on the question of jurisdiction and that he wished to be heard on the matter. The respondent subsequently filed written submissions in which he raised issues regarding jurisdiction as well as the constitutional validity of the Tax Agent Services Act 2009 (Cth) (TAS Act). 4 On the question of jurisdiction, the issue that arose for determination in the application then before the Court has been determined and there is no controversy that is raised in any application before the Court that requires any further determination of that issue at this time. In any event, for the reasons set out below, I am satisfied that the Court has jurisdiction in this proceeding. 5 Section 19(1) of the Federal Court of Australia Act 1976 (Cth) provides: "The Court has such original jurisdiction as is vested in it by laws made by the Parliament". 6 Section 39B(1A)(a) of the Judiciary Act 1903 (Cth) provides: (1A) The original jurisdiction of the Federal Court of Australia also includes jurisdiction in any matter: (a) in which the Commonwealth is seeking an injunction or a declaration… 7 In this context, "the Commonwealth" extends to any agency or instrumentality of the Commonwealth: Deputy Commissioner of Taxation v State Bank (NSW) (1992) 174 CLR 219 at 232 (Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ); Austral Pacific Group Ltd (In liq) v Airservices Australia [2000] HCA 39; (2000) 203 CLR 136 at 141–‍2 [10] (Gleeson CJ, Gummow and Hayne JJ), 152–3 [48] (McHugh J); Australian Securities and Investment Commission v Edensor Nominees Pty Ltd [2001] HCA 1; (2001) 204 CLR 559 at 580 [39] (Gleeson CJ, Gaudron and Gummow JJ). 8 In this proceeding, the applicant Tax Practitioners Board is an agency or instrumentality of the Commonwealth which seeks declarations and injunctions against the respondent and a company incorporated overseas. This is a matter in respect of which this Court has jurisdiction under s 39B(1A)(a) of the Judiciary Act. 9 Section 39B(1A)(c) of the Judiciary Act provides: (1A) The original jurisdiction of the Federal Court of Australia also includes jurisdiction in any matter: … (c) arising under any laws made by the Parliament, other than a matter in respect of which a criminal prosecution is instituted or any other criminal matter. 10 This proceeding is a matter arising under the TAS Act which is a law made by Parliament. This is a matter in respect of which this Court has jurisdiction under s 39B(1A)(c) of the Judiciary Act. 11 The respondent's submissions raised issues concerning the scope of the TAS Act and, in particular, the extent of its extraterritorial operation. The respondent also submitted that, to the extent that the TAS Act operated extraterritorially, its operation was inconsistent with international fair trade agreements entered into by the Commonwealth of Australia. These are not issues that concern the Court's jurisdiction to determine this matter and are matters to be determined at trial. 12 The respondent's submissions also suggest that the constitutional validity of the TAS Act is or may be an issue in the proceeding, contending that laws made by the Parliament after 1985 are unlawful and invalid because they were not assented to by the Queen or "head of power", on the basis that the appointment of the Governor-General was invalid. 13 Where a party raises a matter involving the Constitution, that party must comply with s 78B of the Judiciary Act and rr 8.11 and 8.12 of the Rules. Section 78B(1) of the Judiciary Act provides: Where a cause pending in a federal court including the High Court or in a court of a State or Territory involves a matter arising under the Constitution or involving its interpretation, it is the duty of the court not to proceed in the cause unless and until the court is satisfied that notice of the cause, specifying the nature of the matter has been given to the Attorneys‑General of the Commonwealth and of the States, and a reasonable time has elapsed since the giving of the notice for consideration by the Attorneys‑General, of the question of intervention in the proceedings or removal of the cause to the High Court. 14 The Court thus has a duty not to proceed with a matter arising under or involving the interpretation of the Constitution unless it is satisfied the requisite notices have been given. However, the duty not to proceed is not enlivened by the mere reference to or possibility of a matter arising under the Constitution or involving its interpretation, within the meaning of s 78B of the Judiciary Act. A party who raises such a matter bears the onus of satisfying the Court that the constitutional matter identified is not frivolous, vexatious or unarguable: see Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd [1999] FCA 1151; (1999) 95 FCR 292 at 297 (French J); Chan v Harris (No 3) [2011] FCA 341 at [15]–[19] (Katzmann J). JOINDER AND SERVICE 15 At a further case management hearing held on 11 November 2021, it became apparent during exchanges between the parties that part of Mr Buckland's contention was that he was not the correct respondent. Part of Mr Buckland's contention was that whatever services were being provided were being provided by a company, Apat na Seasons Pilipinas Corporation (the Company), to which he had sold his business. The applicant was granted an opportunity to consider whether there ought to be a joinder application. 16 On 24 January 2023, an interlocutory application for joinder of the Company pursuant to r 9.05 of the Rules was made by the applicant. As part of that application, the applicant sought the following orders relating to service: (1) Pursuant to rr 10.42 and 10.43(2) of the Rules, leave be granted to serve on the Company in the Philippines, in accordance with article 5 of the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, done at the Hague on 15 November 1965 (Hague Convention), an amended originating application and associated relevant documents. (2) Pursuant to r 1.34 of the Rules, any requirement under r 10.49 of the Rules that there be unsuccessful attempts at service of any documents filed in these proceedings be dispensed with. (3) Pursuant to r 10.24(a) or alternatively r 10.49(a) of the Rules, the applicant may serve any documents filed in these proceedings on the Company by sending an electronic link to download and access any such documents by email to specified email addresses. 17 At a case management hearing held on 22 February 2023, the Court expressed its view that an order for joinder of the Company ought to be made in order to ensure the subject matter of the dispute could be dealt with at one time. The applicant was asked to consider the form of orders it required having regard to amendments made to Div 10.4 of the Rules relating to service outside the jurisdiction, which amendments commenced on 13 January 2023. The applicant was requested to provide a short note together with a revised form of order to the Court. The respondent was invited to provide by email to the Court and to the applicant any response he had to the matters which the applicant raised. 18 The applicant filed minutes of proposed order, seeking the following orders: (1) Pursuant to r 9.05 of the Rules, the Company be joined as a respondent to this proceeding. (2) Pursuant to r 8.21 of the Rules, the applicant have leave to amend the originating application dated 14 October 2022. (3) Pursuant to proposed paragraph 2 of the orders, the applicant file (and serve on the respondent) an amended originating application. (4) Pursuant to r 10.44 of the Rules, the applicant have leave to serve on the Company specified associated relevant documents (Relevant Documents). (5) Pursuant to r 1.34 of the Rules, any requirement under r 10.49 of the Rules that there be unsuccessful attempts at service of any documents filed in these proceedings, including the amended originating application and Relevant Documents, be dispensed with. (6) Pursuant to r 10.24(a) or alternatively r 10.49(a) of the Rules, the applicant may serve any documents filed in these proceedings, including the amended originating application and the Relevant Documents, on the Company by: (a) sending an electronic link to download and access any documents filed in these proceedings by email, addressed to the Proper Officer of the Company, at certain specified email addresses; or (b) sending a copy of the documents in PDF form as attachments to one or more emails addressed to the "Proper Officer" of the Company at the email addresses specified in subparagraph (a). 19 The applicant also filed a short note explaining the basis for the orders it sought. The explanation was as follows: (1) The applicant no longer sought leave to serve the amended originating application on the Company because of changes made to r 10.42. The Court observes that the amended rule provides that an originating application may be served outside of Australia without leave in the circumstances specified in the rule. Those circumstances include a proceeding that relates to the construction, effect or enforcement of a law of the Commonwealth, a State or a Territory (r 10.42(p)). These proceedings relate to the construction, effect and enforcement of the TAS Act, a law of the Commonwealth. (2) The applicant continued to press its application for leave to serve specified associated relevant documents on the Company. Leave was also sought for service of a new Form 26A (now required by new r 10.43B). This leave was sought pursuant to r 10.44 which no longer requires service in accordance with the Hague Convention. (3) Orders (5) and (6) were sought in substantially the same form as the orders sought prior to the amendments to the Rules. The amendments to the Rules did not substantially amended rr 10.45 and 10.49, and no changes had been made to rr 1.34 or 10.24. This means that the Court's power to grant substituted service for documents (including originating documents) on a party outside Australia remains unchanged vis-à-vis that power prior to the recent amendments. 20 Mr Buckland submitted that: (1) Rule 10.44 did not permit the applicant to seek the leave of the Court to serve an originating document outside of Australia. (2) The method of service was not in accordance with r 10.45 because the method was not consistent with the Hague Convention or the law of the Philippines. This was confirmed by r 10.46. (3) Accordingly the proposed orders ought to be refused. 21 The Court notes that none of the changes to the Rules affect the orders for substituted service made by Charlesworth J in respect of Mr Buckland. The proposed minutes of order relate solely to documents to be served on the Company. 22 Although the proposed orders sought by the applicant are not directed at Mr Buckland, nonetheless, each of Mr Buckland's submissions is now addressed. 23 In relation to the first submission, the Court observes that the reason r 10.44 does not apply is because originating applications are addressed in r 10.42 (which provides for circumstances in which an originating application may be served outside of Australia without leave) and in r 10.43 (which provides for circumstances in which an originating application may be served outside of Australia with leave). For the reason set out above at [19(1)], the Court is of the view that r 10.42 applies in this case so leave is not required for service of the amended originating application outside of the jurisdiction. 24 The applicant here does not propose to serve in accordance with r 10.45 but seeks leave to substitute another method of service for both the amended originating application and the associated Relevant Documents. Rule 10.49 in Div 10.4 permits a party to apply to the Court for an order substituting another method of service where services in accordance with a convention, the Hague Convention or the law of a foreign country was not successful. Rule 10.24 in Div 10.2 provides for a party to seek an order from the Court to substitute another method of service if it is not practicable to serve a document on a person in a way required by the Rules. Rule 1.34 enables a Court to dispense with compliance with any of the rules. 25 As the applicant submitted, no substantiative changes have been made to any of rr 10.45, 10.49, 1.34 or 10.24 by the amendments to the Rules. 26 Charlesworth J explained how these rules, prior to amendment, interacted at [50]–[54] of her reasons in Buckland (emphasis added): 50. The question is whether I should substitute another method of service under r 10.24. That is, granting leave for the Board to serve the Documents on Mr Buckland by sending him an email or emails containing a link to download and access copies of them. A question of construction arises as to whether or not the power in r 10.24 might be exercised in circumstances where the requirements under r 10.49 are not otherwise met on the facts. 51. Rule 10.49 requires, implicitly at least, that the Court be satisfied that there be an attempt at service on a person and that that attempt has been unsuccessful. The relevant service is service under the Hague Convention. Here, there has been no attempt to serve in accordance with the Hague Convention, including because of the asserted impracticality and asserted urgency for interlocutory relief. 52. The Board relies on Ford, in the matter of Careers Australia Group Limited (in liq) v Mansfield [2022] FCA 173. O'Bryan J there discusses the interrelation between the various rules in a case in which an order for substituted service was sought immediately upon, and in conjunction with, an order granting leave under r 10.43. His Honour refers to a line of authority concerning the interrelation between the rules, including the interrelation between r 10.24 and r 10.49. The effect of those authorities is that this Court may make an order under r 10.24, notwithstanding the existence of r 10.49, provided, of course, that the requirements of r 10.24 are met. The authorities are also to the effect that, even if that be wrong, the Court has the power under r 1.34 to dispense with the requirement of a rule. The dispensation power extends to the dispensation of any requirement implicit in r 10.49 that there be proof of an unsuccessful attempt to serve documents on a person in a foreign country. 53. Accordingly, I am satisfied that I have the power to make an order under r 10.24 and that, in any event, I have the power under r 1.34 to dispense with the requirement under r 10.49 that there be an unsuccessful attempt at, in this case, personal service. 54. Both r 10.24(a) and r 10.49(a) empower the Court to substitute another method of service. I am satisfied, for the purposes of each of those rules, that the method of service sought under [2] of the claim for interlocutory relief is appropriate in these circumstances. 27 In circumstances where there has been no substantive amendment to any of any of rr 10.45, 10.49, 1.34 or 10.24 since her Honour's reasons published on 18 November 2022, her Honour's reasons apply with equal force to the present circumstances concerning the Company. 28 I am satisfied that it is appropriate to make the orders for substituted service. The material before the Court indicates that the average time for service to be effective in a foreign country is approximately four to six months, a timeframe which is not practicable given the nature of the proceedings (being enforcement of a Commonwealth law with a consumer protection policy element) and that service of the documents on the Company by email to the specified addresses is highly likely to bring the proceedings to the Company's attention. 29 The orders will be made in accordance with the applicant's minute of proposed order. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Hespe. Associate: Dated: 8 March 2023