The WA Court of Appeal has dismissed a taxpayer’s appeal against his arguments about claimed non-effective service of a DPN (director’s penalty notice).

  • A company director was served with a DPN under s 222AOE of the ITAA 1936.
  • The DPN was enclosed in a prepaid letter sent from the ATO in Canberra on 23 August 2006 and the Court said that, at all material times, an ASIC document specified that the director’s place of residence or business was Mindarie, a suburb of Perth.
  • The director claimed the first time he became aware of the existence of the penalty notice was when he received a facsimile transmission from the Commissioner on 1 September 2006.
  • Then on 16 September 2006, he was personally served with a copy of the penalty notice.
  • While the director believed that the Commissioner may have posted the penalty notice to him on 23 August 2006, he claimed did not receive the penalty notice in the mail.
  • Judgment against the director in default of appearance was given on 21 March 2007.

After reviewing the matter, including the relevant statutory provisions, the meaning of service by post, Australia Post’s statistics of mail deliveries, etc, the Court of Appeal found that the DPN was deemed to have been delivered to the director on or before 28 August 2006.

The administrator was therefore appointed more than 14 days after the DPN was given to the director. Accordingly, the Court said the penalty was not remitted and the amount of it remained a debt due and owing to the Commissioner. The director’s appeal was therefore dismissed.

(Healy v DCT [2015] WASCA 44, WA Court of Appeal, Buss, Newnes and Murphy JJA, 6 March 2015.)

[LTN 45, 9/3/15]