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26 Oct 2018
Appeal Status

Application to appeal decisions relating to proceedings that have been struck out

The appellant, Garry Albert Muir (“Dr Muir”) brought separate appeals in relation to two High Court decisions.

Garry Albert Muir v Commissioner of Inland Revenue [2018] NZCA 456


The appellant, Garry Albert Muir ("Dr Muir") brought separate appeals in relation to two High Court decisions. The first High Court decision (per Toogood J), Muir v Commissioner of Inland Revenue [2017] NZHC 2082, (2017) 28 NZTC 23-029, concerned the Commissioner of Inland Revenue's ("the Commissioner") challenge of the High Court registrar's acceptance of Dr Muir's amended statement of claim for the 1997 and 2007 to 2010 tax years.

The second decision (per Jagose J), Muir v Taxation Review Authority [2017] NZHC 2932, concerned Dr Muir's judicial review application of the Taxation Review Authority's ("TRA") refusal to accept for filing an amended notice of claim for the 1998 to 2006 tax years. In both cases, the High Court found for the Commissioner.

In this proceeding, before the Court of Appeal, Dr Muir appealed both High Court decisions on the basis that in his view he was entitled to replead his challenge proceedings as they involved facts the courts had not previously considered. Ultimately, the Court of Appeal found for the Commissioner, awarding her costs and dismissed both of Dr Mui's appeals.


Where a court has substantively struck out proceedings, those proceeding have ended and cannot be repleaded by filing amended pleadings.


These proceedings relate to Dr Muir's personal liability for income tax resulting from the Supreme Court's decision in Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue [2008] NZSC 115, [2009] 2 NZLR 289,which found the Trinity scheme void against the Commissioner. Dr Muir subsequently challenged the Commissioner's assessments.

On 1 February 2011, the TRA struck out Dr Muir's challenges to the Commissioner's assessments for the tax year 1998 – 2006. Dr Muir appealed this decision to the High Court. On 22 April 2015, Faire J of the High Court dismissed this appeal and in the same proceeding struck out challenges Dr Muir had also raised in relation to the tax years 1997 and 2007 – 2010.

Dr Muir appealed Faire J's decision to the Court of Appeal and on 8 December 2015 the Court of Appeal upheld Faire J's decision and dismissed the appeal (Muir v Commissioner of Inland Revenue [2015] NZCA 591, (2015) NZTC 22-034). Dr Muir sought leave to appeal the Court of Appeal's decision and the Supreme Court refused leave in respect of the 1997 and 1998 years but did grant leave to appeal in relation to the 1999- 2000 years. That leave was later revoked when Dr Muir changed his grounds of appeal. This had the effect of the Court of Appeal decision standing and Dr Muir's tax challenges remaining struck out.

Nevertheless, Dr Muir attempted to file an amended notices and statements of claim in the TRA and High Court. The TRA refused to accept filing, which Dr Muir judicially reviewed and lost (Jagose J decision). The High Court accepted filing, which the Commissioner challenged and won (Toogood J decision). These decisions were the subject of this Court of Appeal decision.

Separate to these proceedings, Associate Judge Bell entered summary judgment in favour of the Commissioner against Dr Muir for unpaid taxes, interest and penalties for the 1997 to 2010 tax years. Dr Muir lost his appeal of that decision to the Court of Appeal and was declined leave by the Supreme Court on the basis that Associate Judge Bell's decision created a res judicata given Dr Muir's tax challenges had been finally determined.


The Court of Appeal dismissed Dr Muir's appeals and awarded costs to the Commissioner.
Prior to the Supreme Court's decision in refusing Dr Muir leave to challenge Associate Judge Bell's summary judgment decision, the Court of Appeal had concluded that given the challenge proceedings were at an end they would have dismissed these appeals in any event. However, the Court of Appeal considered the Supreme Court's decision noting that Associate Judge Bell's decision had created a res judicata precluding Dr Muir from bringing challenge proceedings on matters that had already been finally determined.

Dr Muir argued that the High Court rules demonstrated a distinction between striking out pleadings and staying or dismissing proceedings and that it is the Income Tax Act 2007 that imposes liability on a taxpayer and not the decision of the Commissioner or a hearing authority.

The Commissioner argued that the decisions of the High Court and the Court of Appeal clearly struck out Dr Muir's challenge proceedings as an abuse of process which was subsequently confirmed by the Supreme Court.

The Court of Appeal held that the phrase "striking out the proceeding" as used by Judge Barber and Faire J "can only be understood as meaning that, having been determined to be an abuse of process, Dr Muir's challenge proceedings were, at that point, at an end." As the proceedings were at an end, Dr Muir could not file amended notices or statements of claim and, accordingly, the appeal was dismissed.

High Court Rules 2016, r 15.1, Tax Administration Act 1994, s 138D