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08 Nov 2011
Appeal Status
Not appealed

Abuse of court process to re-litigate misconceived cases

2011 case note – reaffirms fact that Courts are reluctant to re-litigate misconceived cases - mischievous, frivolous, vexatious, strike-out.

Clarence John Faloon v Commissioner of Inland Revenue


Since the taxpayer's proceeding was of the same nature as others that have been unsuccessful it was found to be abuse of court process.

Impact of decision

The fact pattern involved in this case is fairly unique. Nevertheless it does re-affirm the fact that the Courts are reluctant to allow the re-litigation of misconceived cases.


By the Commissioner's counsel's submission this is the twenty-eighth proceeding filed in connection with events which first occurred over 40 years ago regarding land owned by the taxpayer's family company (then controlled by his father).

Mr Faloon previously endeavoured to return income which he considered was compensation for land compulsorily acquired. While the reason for this was unclear, the Judge surmised that his purpose seemed to be that if this was accepted by the Commissioner then this may form the basis upon which Mr Falloon can pursue a new claim for further compensation.

The claim in this proceeding concerns a Notice of Proposed Adjustment (NOPA) filed by Mr Faloon, which was rejected by a Notice of Response (NOR). In 2009 Mr Faloon filed proceedings challenging the NOR, which were struck out.

After this previous unsuccessful proceeding, Mr Faloon wrote to the Commissioner inquiring whether he would be issuing a disclosure notice related to the same taxpayer's NOPA that gave rise to the earlier strike-out proceedings.

The Commissioner responded in the negative in a letter ("the letter").


Mr Faloon's claim was struck out and generally dismissed on the basis that the proceeding prosecuted by Mr Faloon was mischievous, frivolous, vexatious and an abuse of Court process. Furthermore, the letter was not a disputable decision and could not be used by Mr Falloon as an attempt at re-litigation of earlier decisions.

Associate Judge Christiansen states [35]:

  • ... Mr Faloon is conscientiously rejecting each and every decision which is not in his favour by steadfastly clinging to the slightest glimmer of hope which might be in his favour.

He continued [at 36]:

  • Mr Faloon is confused in his belief that he or the trusts he represents are related parties or retain a right of suit in connection with any right of claim his family companies may have had in the outcome of the taking of certain land in which process compensation was ordered to be paid.

Tax Administration Act 1994