Karageorge v Deputy Commissioner of Taxation [1999] NSWSC 1009

New South Wales Supreme Court CITATION : Karageorge v Deputy Commissioner of Taxation [1999] NSWSC 1009 revised - 03/11/99 CURRENT JURISDICTION : Equity FILE NUMBER(S) : 3575/99 HEARING DATE(S) : 26 August 1999 JUDGMENT DATE : 6 October 1999

PARTIES : Constantine Karageorge (Plaintiff) Deputy Commissioner of Taxation (Defendant) JUDGMENT OF : Hamilton J

COUNSEL : In person (Plaintiff) SJ McMillan (Defendant) SOLICITORS : In person (Plaintiff) Australian Government Solicitor (Defendant) CATCHWORDS : PROCEDURE [316] - Inferior Courts - District Court - Removal into Supreme Court - After judgment entered - Whether District Court Act 1973, s 145 confers power to remove. ACTS CITED : District Courts Act 1912, s 47, District Court Act 1973, s 145. Ex parte Vigilant Finance (NSW) Pty Ltd; Re Cameron Smith [1964] NSWR 1282, Hewins v Formica Plastics Pty Ltd (1968) 87 WN (Pt 1) (NSW) 469, CASES CITED : Ex parte Sabbatini; Re Australian Iron & Steel Pty Ltd (1970) 92 WN (NSW) 377, Ex parte Sadler; Re Cemac Modular Constructions Pty Ltd [1973] 1 NSWLR 263, Coles v Burke (1987) 10 NSWLR 429, FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268. DECISION : Ruling that there is power under s 145 of District Court Act 1973 to remove proceedings into Supreme Court after judgment has been entered in the District Court.

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

HAMILTON J WEDNESDAY, 6 OCTOBER 1999

3575/99 CONSTANTINE KARAGEORGE v DEPUTY COMMISSIONER OF TAXATION

JUDGMENT His Honour: 1 In proceedings 2907/97 the Deputy Commissioner of Taxation ("DCT") sued Ann Maree Bowen to recover part of the proceeds of the sale of a house property ("the property") which she had co-owned with the present plaintiff, with whom she had once lived in a de facto relationship. The DCT alleged that the moneys were the plaintiff's, and that the DCT was entitled to take them in satisfaction of an assessment of the plaintiff to income tax ("the assessment"). Ms Bowen denied that the moneys were the plaintiff's, and by cross claim against both the DCT and the plaintiff sought a declaration that the plaintiff had held his share of the property in trust for Ms Bowen. The plaintiff was not, but should have been, a defendant to the DCT's claim, since it was alleged that the moneys were his. When the matter was called on for hearing, it was announced that it was settled as between the DCT and Ms Bowen; in effect the DCT abandoned his claim against Ms Bowen. At that time, the present plaintiff was seeking to file a cross claim against the DCT for a declaration that the assessment was invalid. The DCT submitted that I should, without more, refuse that application out of hand, leaving the plaintiff to bring fresh proceedings if he so desired, by reason that the proceedings were otherwise settled. I declined to do that, on the ground that the cross claim was closely associated with the subject matter of those proceedings and the plaintiff had made his application before the DCT, in effect, abandoned his claim. The DCT further objected to the application to file the cross claim on the grounds (1) that the plaintiff's proposed cross claim was bad on its face, and (2) that he had a judgment in the District Court at Sydney against the plaintiff in proceedings 6808/97 based upon the assessment, which judgment foreclosed the plaintiff's claim to have the assessment declared invalid. The plaintiff, on the other hand, claims to be entitled to have the District Court judgment set aside. The judgment was entered after a trial from which the plaintiff was absent. He says that the cause of his absence was that he was in prison and no warrant had been issued under s 44 of the Prisons Act 1952 for his attendance at Court. He has now brought these proceedings by summons to have the District Court proceedings removed into this Court under s 145 of the District Court Act 1973 ("the new Act"), so that the same Court may adjudicate upon his entitlement to have the District Court judgment set aside and whether his cross claim for a declaration of invalidity of the assessment ought be allowed into Court, or as the DCT submits, rejected, because foreclosed by the District Court judgment or because it is manifestly bad. 2 The matters are, as appears above, closely interrelated and it seems to me that there is a prima facie case that the District Court proceedings should be removed into this Court to permit them to be dealt with simultaneously or in association with the application to bring the cross claim. This would be convenient, and economical for both the parties and the State. However, the DCT objects to this course on the ground that proceedings cannot be removed from the District Court to this Court under s 145 after judgment. The question therefore arises as to whether this proposition is correct. 3 This proposition flows from a number of decisions under or, more accurately, obiter dicta relating to, the corresponding provision in the predecessor of the new Act, namely, s 47 (1) of the District Courts Act 1912 ("the old Act"). That section, prior to an amendment operative in 1972, provided: "Any plaint entered in any District Court may be removed by the writ of certiorari into the Supreme Court by order of any judge thereof upon such terms as to payment of costs, giving security for the amount claimed or costs or such other terms as such judge thinks fit." 4 After the amendment (effected by the Supreme Court Act 1970 s 7 and the Second Schedule and operative 1 July 1972) the sub section read: "Any plaint entered in any District Court may be removed into the Supreme Court by order of the Supreme Court upon such terms as to payment of costs, giving security for the amount claimed or costs or such other terms as the Supreme Court thinks fit."