O v Revenue Commissioners

• Jurisdiction: Ireland
• Judge: Mr. Justice Geoghegan
• Judgment Date: 05 October 1994
• Neutral Citation: 1994 WJSC-HC 3880
• Docket Number: 100 JR/1994,[1994 No. 100 J.R.]
• Court: High Court
• Date: 05 October 1994

1994 WJSC-HC 3880

THE HIGH COURT

100 JR/1994

O v. REVENUE COMMISSIONERS

JUDICIAL REVIEW

BETWEEN

JAMES G. ORANGE

APPLICANT

AND

THE REVENUE COMMISSIONERS

RESPONDENTS

Citations:

FINANCE ACT 1988 S73

CONSTITUTION ART 34

CONSTITUTION ART 40

CONSTITUTION ART 43

FINANCE ACT 1988 S73(13)

COMMON LAW PROCEDURE (IRL) ACT 1854

Synopsis:

CONSTITUTION

Personal rights

Livelihood - Means - Deprivation - Tax - Collection - Method - Debt - Attachment - Debt payable to taxpayer by third party - Attachment of debt by revenue commissioners - Third party being main source of taxpayer's income - (1994/100 JR - Geoghegan J. - 5/10/94) - [1995] 1 I.R. 517

|O. v. The Revenue Commissioners|

CONSTITUTION

Personal rights

Property - Confiscation - Tax - Collection - Method - Debt - Attachment - Debt payable to taxpayer by third party - Attachment of debt by revenue commissioners - Third party being main source of taxpayer's income - (1994/100 JR - Geoghegan J. - 5/10/94)

|O. v. The Revenue Commissioners|

CONSTITUTION

Statute

Validity - Tax - Collection - Method - Debt - Attachment - Debt payable to taxpayer by third party - Attachment of debt by revenue commissioners - Whether an unjust attack on property rights - Whether right to earn livelihood infringed - (1994/100 JR - Geoghegan J. - 5/10/94) - [1995] 1 I.R. 517

|O. v. The Revenue Commissioners|

REVENUE

Value-added tax

Collection - Method - Debtor - Debt - Attachment - Taxpayer being practising solicitor - Taxpayer dependent on income from work in criminal legal-aid scheme - Debt payable to taxpayer by Minister for Justice under scheme - Attachment of debt by revenue commissioners - Whether an unjust attack on property rights- Whether taxpayer deprived of means of livelihood - Whether purported administration of justice by the executive - Finance Act, 1988, s. 73 - (1994/100 JR - Geoghegan J. - 5/10/94) - [1995] 1 I.R. 517

|O. v. The Revenue Commissioners|

WORDS AND PHRASES

"Administration of justice"

Tax - Collection - Method - Debt - Attachment - Debt payable to taxpayer by third party - Attachment of debt by revenue commissioners - No justiciable controversy determined - (1994/100 JR - Geoghegan J. - 5/10/94) - [1995] 1 I.R. 517

|O. v. The Revenue Commissioners|

1 Judgment of delivered the 5th day of October 1994 Mr. Justice Geoghegan

2 This is an application for Judicial Review made pursuant to leave granted by this Court on the 14th March, 1994. The specific reliefs sought are a declaration that Section 73 of the Finance Act, 1988 is invalid having regard to the Constitution and in particular to Articles 34, 40 and 43 thereof, and an Order of Certiorari quashing a Notice of Attachment dated the 1st February, 1994 purported to be made pursuant to Section 73 of the said Act of 1988, directed to the Minister for Justice instructing the Minister to pay to the Revenue Commissioners any debts due to the Applicant.

3 The Applicant is a solicitor who claims that he is almost exclusively dependent upon criminal legal aid work for his earnings. He fell into substantial arrears in liability for Value Added Tax and this default in turn attracted interest charges. He claims that in more recent times he has been up to date with his VAT payments while being unable to discharge the arrears. The effect of the Notice of Attachment of the 1st February, 1994 was to secure direct payment to the Respondents of all sums due by the Minister for Justice to the Applicant in respect of legal aid fees, including the VAT on those fees. The Respondents admit that any such payments coming from the Minister for Justice will be appropriated to the arrears, interest liability and penalties and they further maintain (correctly I think) that they have no statutory power to credit any of the monies coming from the Minister for Justice towards the discharge of current VAT liability even though those sums include VAT. It is against that background that Counsel for the Applicant makes three main arguments. These are:-

4 1. The notice procedure under Section 73 effects an attachment of debts without the intervention of a Court Order unlike what happens in the case of an ordinary garnishee and it is therefore, according to the argument, unconstitutional as being both a form of executive administration of justice and an unfair procedure.

5 2. The notice procedure is unconstitutional in that in the case of somebody such as the Applicant it constitutes an attack on his constitutional right to earn a livelihood and that this is particularly so in any case where the taxpayer is largely dependent for his livelihood on a single customer.

6 3. The purported Attachment Notice procedure constitutes an unfair attack on the Applicant's property rights and particularly in the circumstances that it deprives him of being able to discharge his current VAT liability without incurring new interest charges and penalties.

7 Before considering these arguments I think it useful to explain briefly the mechanics of Section 73 of the Finance Act, 1988 as it applies to the Applicant. The procedure is for the most part directed at obtaining information from creditors of a taxpayer and ultimately procuring payment of a debt owing to the taxpayer direct to the Respondents. The Attachment Notice requires the third party to inform the Respondents within a period of 10 days whether any debt is due by him to the taxpayer and, if so, of what amount and requiring the payment to the Respondents of so much of that debt as does not exceed the amounts owing by the taxpayer. A statutory obligation is imposed upon the third party to comply with the Attachment Notice. Before an Attachment Notice is served, the Respondents are obliged to give the taxpayer a notice in writing not later than 10 days before the date of the receipt by the third party of the Attachment Notice stating that if the amount is not paid it may be specified in a Notice of Attachment and recovered under the section from a relevant person. There are provisions in the section for recovering the relevant debt from the third party in Court proceedings where it is admitted but not paid over. As far as the Applicant is concerned, the provision in Section...