Chief Collector of Taxes v Bayliss [1969-70] PNGLR 289 (24 October 1969)

Papua New Guinea Law Reports - 1969-70

[1969-70] PNGLR 289 - Chief Collector of Taxes v Bayliss

[1969-70] PNGLR 289

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

CHIEF COLLECTOR OF TAXES

V

BAYLISS

Port Moresby

Minogue ACJ

9 October 1969

24 October 1969

PRACTICE - Service of writ under Service and Execution of Process Act 1901-1963 (Cth) - No appearance by defendant - Motion by plaintiff to proceed to judgment - Action to recover money payable under statute - Implied contract - Service and Execution of Process Act 1901-1963 (Cth), s. 11 - Income Tax Ordinance 1959-1968, s. 262(1).

The plaintiff commenced an action by writ of summons against the defendant for non-payment of taxes assessed in pursuance of the Income Tax Ordinance 1959-1968. The writ was served on the defendant in Victoria under the provisions of the Service and Execution of Process Act 1901-1963 (Cth). The defendant did not enter an appearance and the plaintiff moved for leave to proceed to judgment pursuant to the Service and Execution of Process Act 1901-1963 (Cth), s. 11.

Held

That there should be leave to proceed. An action to recover a sum of money made payable by statute was an action to enforce a “contract” within the meaning of s. 11(1)(b) of the Service and Execution of Process Act (Cth).

Belyando Shire Council v. Rivers, [1908] Q.W.N. 17; Chenoweth v. Summers, [1941] A.L.R.(C.N.) 364; State of Victoria v. Hansen[1960] VicRp 90; , [1960] V.R. 582, followed.

Gilchrist v. Dean[1960] VicRp 42; , [1960] V.R. 266, referred to.

Motion for Leave to Proceed to Judgment

The Chief Collector of Taxes (the plaintiff) commenced an action in the Supreme Court of the Territory of Papua and New Guinea against Colin Powell Bayliss claiming $12,752 for balance of tax on income derived during the years ended 30th June, 1966, 1967 and 1968, for provisional tax in respect of income ended 30th June, 1969 and for additional tax pursuant to the provisions of s. 262(1) of the Income Tax Ordinance 1959-1968. The writ carried the necessary indorsements for service under the Service and Execution of Process Act 1901-1968 (Cth) which, by an amendment of 1953, was made to extend to the Territory of Papua and the Territory of New Guinea. The relevant assessments to income tax were made by the plaintiff for each of the years in question at some time towards the end of November or early in December, 1968. The date for payment of the tax assessed was 10th January, 1969. The defendant left the Territory on 29th November, 1968 and had not returned. He was served with the writ in Melbourne and is believed to be still living in Victoria. No appearance had been entered to the writ.

Counsel

Leach, for the applicant.

No appearance by the defendant.

Cur. adv. vult.

24 October 1969

MINOGUE ACJ:  This was a motion on the part of the plaintiff for an order that leave to proceed to judgment be given pursuant to the Commonwealth Service and Execution of Process Act 1901-1968. [His Honour then stated the facts and continued.]

Mr. Leach for the plaintiff sought leave to proceed under s. 11 of the Service and Execution of Process Act and he founded his application on sub-s. (1)(b), submitting that the subject matter of the suit was a contract entered into in this Territory and that relief was sought in the suit by way of enforcing that contract. Alternatively he submitted that at the time when the liability sought to be enforced against the defendant arose he was within the Territory and so I should give leave to proceed there under s. 11 (1) (e). On the proposition first being stated I was somewhat surprised to think that a liability of this nature could be thought to be one arising under a contract. Mr. Leach sought to dispel my doubts by referring me to the case of Belyando Shire Council v. Rivers[cdi]¹ which was followed by Judge Magennis in the County Court at Melbourne in Chenoweth v. Summers[cdii]². In Belyando Shire Council v. Rivers[cdiii]³ the Full Court of Queensland decided that the statutory obligation to pay rates on land under The Local Authorities Act of 1902 raised an implied contract to pay such rates and consequently that s. 11 was applicable and leave was given to proceed as if the defendant had been served within the jurisdiction, the writ having been served out of the jurisdiction. Real J. referred to a passage in Stephen on Pleading, 7th ed., p. 11 wherein it is stated:

“Action of assumpsit lies where a party claims damages for a breach of a simple contract, i.e., promise not under seal. Such promises may be express or implied, and the law always implies a promise to do that which a party is legally liable to perform. The remedy consequently has a very large and extensive application.”

In his view this passage was sufficient authority and, as he put it to counsel, he need worry no further. Judge Magennis thought this case compelled him to hold that an assessment for State income tax raised an implied contract to pay the amount of the assessment to the Commissioner. In Gilchrist v. Dean[cdiv]⁴ Sholl J. discusses these cases and he points out that Belyando Shire Council v. Rivers[cdv]⁵ was based upon old authorities which established clearly enough that an action, generally of debt but sometimes in assumpsit, would lie for liquidated sums payable under statute. Adam J. in State of Victoria v. Hansen[cdvi]⁶ followed Belyando Shire Council v. Rivers[cdvii]⁷, holding that an action by the State of Victoria to recover stamp duty assessed under the Stamps Act 1958 on the transfer of stock units registered in Victoria in a company incorporated in Victoria was an action to enforce a “contract” and accordingly that it fell within the provisions of s. 11(1) of the Commonwealth Act. So far as he could discover the Queensland decision had stood unchallenged for over fifty years and he referred to its having been followed in Chenoweth v. Summers[cdviii]⁸. I too have been unable to discover any challenge to this decision and it seems to have been impliedly approved in Gilchrist v. Dean[cdix]⁹. I have no doubt that the implied contract to pay the tax assessed in this case is to be considered as made or entered into in this Territory. Accordingly, I agree with Mr. Leach’s first submission and order that the plaintiff have leave to proceed as if the writ had been served within the jurisdiction.

The alternative submission based on the provisions of s. 11(1)(e) raises questions of some difficulty as to the precise time at which the liability sought to be enforced against the defendant arose. However, as I have acceded to Mr. Leach’s first argument it is unnecessary to consider these difficulties further.

Order accordingly.

Solicitor for the plaintiff: P. J. Clay, Acting Crown Solicitor.

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[cdi][1908] Q.W.N. 17.

[cdii][1941] A.L.R.(C.N.) 364.

[cdiii][1908] Q.W.N. 17.

[1960] V.R. 266, at p. 271.

[cdv][1908] Q.W.N. 17.

[cdvi][1960] V.R. 582.

[cdvii][1908] Q.W.N. 17.

[cdviii][1941] A.L.R.(C.N.) 364.

[cdix][1960] VicRp 42; [1960] V.R. 266.