Michael Gladney v Caroline Lambe
| Jurisdiction | Ireland |
| Judge | Mr Justice Bernard Barton |
| Judgment Date | 08 July 2014 |
| Neutral Citation | [2014] IEHC 350 |
| Court | High Court |
| Date | 08 July 2014 |
AND
[2014] IEHC 350
HIGH COURT
Taxation – Capital Gains Tax – Assessment – Notice of Appeal – Practice & Procedure – Summary Judgment – Leave to Defend – Taxes Consolidation Act 1997.
Facts: The plaintiff brought these proceedings in order to obtain summary judgment against the defendant. The plaintiff was the Collector General of the Revenue Commissioners and it was claimed that the defendant owed capital gains tax for the period 2007 to 2008. The defendant argued that summary judgment should not be granted as she had entered notices of appeal against the capital gains tax assessments which had yet to be determined by the plaintiff and were therefore still pending. The plaintiff argued that the appeal notices were not valid and that therefore the assessments were final and conclusive.
Held by Barton J., that in determining whether to enter final judgment in summary proceedings several factors had to be taken into account. These include exercising caution when assessing each case on it”s own facts to discern the context of the proceedings and when evaluating if the issues are simple or complex. In addition, a defendant should not have to prove that their defence will succeed but merely has show that they have a bona fide defence. Even though a simple assertion will not persuade a court to refuse summary judgment, on the other hand a mere doubt about the defence will not guarantee summary judgment. Furthermore, a judge should assess what order to make on the basis of what would secure a just and fair result.
Barton J. held that the issues in this case included whether letters from the defendant to the plaintiff regarding the assessment of capital gains tax constituted valid notices of appeal for the purposes of the Taxes Consolidation Act 1997. He stipulated that in order to determine these issues, which included questions of law and fact, it would be preferable to hear fuller arguments at a plenary hearing. Consequently, the plaintiff”s application for summary judgment was refused and instead a plenary hearing was ordered.
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JUDGMENT of Mr Justice Bernard Barton delivered the 8th day of July 2014
1. These proceedings are brought by way of summary summons whereby the Collector General of the Revenue Commissioners seeks to recover judgment against the defendant in the sum of €219,551.42 in respect of capital gains tax of which the sum of €193:220.53 comprises the appropriate tax and interest for the year 1 st of January 2007 to 31 st December 2007 and €26.330.89 in respect of the tax and interest for the year 1 st January 2008 to the 31 st December 2008.
2. This matter comes before the court by way of motion on notice dated 5 th of February 2013, whereby the plaintiff seeks liberty to enter final judgment in the amount claimed on foot of the summary summons issued herein. Affidavits have been sworn by or on behalf of the plaintiff and the defendant in these proceedings. When the matter came on for hearing counsel for the plaintiff submitted that, as the assessments for the years in question had not been the subject matter of valid notices of appeal by the defendant, the capital gains tax liability assessments for those years became due and were final and conclusive by virtue of the provisions of the Taxes Consolidation Act, 1997 (hereinafter referred to as the TCA of 1997), accordingly, it followed that there could not be a bona fide defence to the plaintiffs claim and that the plaintiff should be given liberty to enter summary judgment against the defendant.
3. On behalf of the defendant it was submitted that there was a defence to the claim the essence of which is that there was no liability on the part of the defendant to pay the amounts claimed, moreover, the defendant had, through her accountant, Harry Conlon & Co., by letter dated the 2 nd February 2011, given Notice of Appeal in respect of each assessment in accordance with the TCA of 1997.
4. There was broad agreement between the parties as to the principles to be applied on an application for liberty to enter the final judgment in summary proceedings. In this regard the court was referred to Harrisrange Ltd. v. Duncan [2003] 4 I.R. 1 and Harrahill v. Kane [2009] IEHC 322 as well as the other authorities referred to in the judgments delivered in those cases.
5. Whilst I do not think it necessary to recite either the facts nor the decisions in those cases I think it useful to adopt, as I did in Ulster Bank Ireland Limited v. Fortune and Another (Unreported, 16 th May, 2014). the summary of the principles enumerated in the judgment of McKechnie J. in Harrisrange Ltd. v. Duncan [2003] 4 I.R. 1 at 7 and which are as follows:
(i) The power to grant summary judgment should be exercised with discernable caution.
(ii) In deciding upon this issue the court should look at the entirety of the situation and consider the particular facts of each individual case, there being several ways in which this may best be done;
(iii) In doing so the court should assess not only the defendants response, but also in the context of that response, the cogency of the evidence adduced on behalf of the plaintiff, being mindful at all times of the unavoidable limitations which are inherent on any conflicting affidavit evidence;
(iv) Where truly there are no issues or issues of simplicity only or issues easily discernible, then this procedure is suitable for use;
(v) Where however, there are issues of fact which, in themselves, are material to success or failure, then their resolution is unsuitable for this procedure:
(vi) Where there are issues of law, this summary process may be appropriate but only so if it is clear that fuller argument and greater thought is evidently not required for a better determination on such issues;
(vii) The test to be applied, as now formulated is whether the defendant has satisfied the court that he has a fair or reasonable probability of having a real or bona fide defence; or as it is sometimes put, 'is what the defendant says credible?', which latter phrase I would take as having as against the former an equivalence of both meaning and result;
(viii) This test is not the same as and should not be elevated into a threshold of a defendant having to prove that its defence will probably succeed or that success is not improbable, it being sufficient if there is an arguable defence:
(ix) Leave to defend should be granted unless it is very clear that there is no defence;
(x) Leave to defend should not be refused only because the court has reason to doubt the bona fides of the defendant or has reason to doubt whether he has a genuine cause of action;
(xi) Leave should not be granted where the only relevant averment in the totality of the evidence, is a mere assertion of a given situation which is to form the basis of a defence and finally;
(xii) The overriding determinative factor, bearing in mind the constitutional basis of a persons right to access to justice either to assert or respond to litigation, is the achievement of a just result whether that be liberty to enter judgment or leave to defend, as the case may be."
6. Counsel for the plaintiff, Mr Neuman Shanahan, submitted that the whole matter really depended upon the determination of what was, in essence, a net point of law, namely whether or not the letters of the 21 st February 2011, and sent by the defendantapos;s accountant, constituted valid notices of appeal against the relevant assessments. It was submitted that this was a question upon which the court could and should make a determination on the within application. In this regard he cited the decision of this Court in Irwin v. Grimes (2008) IEHC 86. That was a case in which the Revenue Commissioners sought summary judgment against the defendant for €96,576.28 in respect of arrears of income tax for the years 1978 through to 1990.
7. It is clear from a reading of the judgment in that case, however, that there was agreement between the parties that the court should deal with the net legal point on an application such as that now before the court, accordingly, the decision is not an authority for the proposition that the court is required or should deal with the net legal point on an application for summary judgment.
8. What is of relevance, however, is that the issue which had to be decided in that case was whether or not there were valid and subsisting appeals from the assessments by the revenue. The defendant argued that because the revenue had not responded in writing to his purported...
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