Lionel and Scientology: how law firms can avoid payroll tax
What Melbourne Truth thought 46 years ago, Senator Nick Xenophon thinks today. Well done, that man.
Truth forced an inquiry into Lafayette Ron Hubbard’s organisation, Scientology, in 1963.
I assume the driving force was my future pal, the editor Billy Williams (Justinian, June 23, 2008).
Billy was known to Truth readers, perhaps with some scepticism, as Marc Brody, Melbourne’s Most Exciting Man.
Lionel Murphy J (pic) noted the upshot of the inquiry in “Church of the New Faith v Commissioner of Pay-Roll Tax (Vic):”http://www.austlii.edu.au/au/cases/cth/HCA/1983/40.html (the Scientology case):
“The Board of Inquiry reported in September 1965: ‘Scientology is evil; its techniques evil; its practice a serious threat to the community, medically, morally and socially; and its adherents sadly deluded and often mentally ill… In a community which is nominally Christian, Hubbard’s disparagement of religion is blasphemous and a further evil feature of scientology’.”
The report, “led to the Psychological Practices Act 1965 (Vic), which made the teaching of Scientology an offence”.
But, said Lionel:
“The church was recognised as a religious denomination [presumably by Lionel himself as AG] ... on 15 February 1973 … it is granted exemption as a religious institution from pay-roll tax in South Australia, Western Australia, New South Wales and the Australian Capital Territory.”
So much for the strict separation of Church and State.
The Victorian Commissioner of Payroll Tax’s rejection of Scientology’s claim for exemption was upheld by Bill Crockett in the Supreme Court and, on the ground that Scientology was not a religious institution, by Sir John Young CJ, Bill Kaye and Bob Brooking in the Appeal Court.
But in the High Court, L. Ron’s (seen here) disciples won 5-zip: Tony Mason, Ged Brennan, Billy Deane, Ron Wilson, and Lionel.
Lionel’s judgment is hilarious. He demolished several arguments for organised religion, and noted:
“The crushing burden of taxation is heavier because of exemptions in favour of religious institutions, many of which have enormous and increasing wealth.”
He then concluded:
“Any body which claims to be religious, and offers a way to find meaning and purpose in life, is religious.”
Scientology was thus entitled to the exemption.
That surely leaves it open for law firms and other businesses to declare themselves religions, if they haven’t quietly done so already.
Xeno wants a new inquiry into Scientology, but other politicians may calculate: if we proscribe one dubious religion, the others might rise up and bite us.
No fault, no pelf
A no-fault scheme sadly eliminates lawyers because there is nothing to argue about.
Ruddites who favour a no-fault disability scheme (SMH, Nov. 24) will thus be wise to learn from the experience of Prime Minister E. Gough Whitlam QC (snap).
The Goughter tried to introduce a no-fault accident scheme after Justice Rae Else-Mitchell, of the NSW Supreme Court, said in 1972:
“The case for all claims arising out of motor vehicle and industrial accidents being decided on a no-fault basis by an administrative tribunal is unanswerable … more people would be able to go to court and the taxpayer would be better off in the end.”
With some bitterness, Whitlam recalled (The Curtin Lecture, 1985) that his Government was thwarted by the stone-walling tactics of interested parties, “aided and abetted by Labor lawyers who specialised in work for unions”.
For good measure, the great man added:
“The basis of their thriving practices is to charge unions for the expert advice in cases of accidents to unionists at work and on the way to and from work, and at the same time to render gratuitous advice to union officials on methods to entrench themselves in office.”
Jodee (and Bonaparte) lives!
ASIC v Rich was not all that complicated, according to News Ltd finance writer Terry McCrann.
He said it, “wasn’t about Swiss bank accounts or complicated financial structures and transfers, but pretty simply, a company going broke”. (Herald-Sun, Nov. 19.)
Pic: Jodee Rich
“Maybe we should contemplate throwing out our combative process, which is now working only to enrich lawyers … Perhaps instead, we could adopt the Napoleonic continental system, which actually seeks the truth, as a necessary prerequisite to dispensing justice.”
McCrann might have something there. The beak, Bobby Austin, admitted he could not try to find the truth. He said:
“The proceedings are not a Royal Commission… The question for determination is not … how it happened … (or) who was to blame … many questions about the failure of One.Tel are left unanswered.”
There is also the problem that ours is the only system which conceals evidence. Bobby had to conceal from himself much of the evidence of forensic accountant Paul Carter.
Boney’s system is also a tiny bit more cost-effective than ours. As Russell Fox QC has said (Justinian June 14, 2005), relatively few civil hearings take much more than a day overall.
The One.Tel case took three years of hearings; another two years for Bobby to write a judgment of 3,105 pages (about 10 ordinary books); and cost taxpayers some $35 million.
ASIC v Rich will thus do little to improve citizens’ happiness with the system.
The Australian Institute of Criminology reported (SMH Nov, 24) that, in terms of confidence in the criminal system, Australia places 26th of 36 countries surveyed.
In Denmark, which uses the Bonapartist system, 79 percent of citizens have “quite a lot” of confidence in the system. In Australia, the figure is 35 percent.
Out damned beaks!
If ASIC v Rich persuades politicians to take a hard look at the process, International Finance Trust Co Ltdv NSW Crime Commission (High Court, Nov. 12), has caused at least one to cast a beady eye on at least one judge.
The AGs for Australia, NSW, Victoria, SA, Queensland and WA intervened in IFT to advise the High Court that NSW judges were right to let the NSW Crime Commission freeze assets while checking to make sure the money did not come from drug-running, money-laundering or some such.
But Bobby French, Bill Gummow, Dyson Heydon, and Virginia Bell knew better than six first law officers and three other judges, Ken Hayne, Susan Crennan and Susan Kiefel.
The NSW Parliament will now have to bring down new legislation and make it retrospective, as Little Jackie Howard did in 1978 after High Court beaks said a profit is a loss (Curran, 1974), and so added to ‘the crushing burden of taxation’ for PAYE taxpayers (see Scientology).
Senator Steve Hutchins (seen here), chair of the oversight committee on the Australian Crime Commission, took aim at French CJ and let fly.
He said French had acted “with a complete disregard for the interests of public order and justice”. (SMH Nov. 17.)
One of these days the beaks will really go that one step too far, as their UK brethren did with super-injunctions in the Trafigura case, and the politicians will say: Out, damned beaks!