G. T. Pagone, Tax Effective Writing, The Federation Press, 2013 discusses written advocacy theory in tax matters with illustrative precedents for correspondence and administrative and court processes.
The book is an excellent, current and concise primer for new practitioners to tax controversy. Unfortunately, it does not contain many illustrative pleading examples.
General Drafting
Pagone advocates writing for the benefit of the intended and successive reader within legislative and procedural constraints. An author should frame issues and lead the reader by word selection and sequence, sentence structure and punctuation, style and technique and factual context. Intuitive persuasion techniques such as anchoring facts, rhetoric, repetition, simile, metaphor, analogy and antithesis should be used appropriately to avoid counterproductive perceptions of manipulation or distortion. Attention should be paid to physical presentation, legibility, simplicity and readability, because each affects persuasiveness.
Pagone discusses legislative and procedural constraints and particular style approaches relevant to tax correspondence and administrative and court processes.
Opinions & Advices
The difference between an opinion and an advice (only advice contains recommendations) affects the selection of advocacy style and technique. The form and content should be precise, concise, simple and clear, within the expressly identified retainer and must comply with professional obligations. The opinion or advice should, where appropriate, express and test relevant facts, address risks and include disclaimers and limitations.
Objections
Objections must comply with statutory form and content and should be written for the successive review and appeal processes. The objection must state the relevant grounds fully and in details and the reasons of how the assessment is excessive. The form and content of the objection may vary based on the legislative source of the assessment, determination or exercise of discretion.
A method of drafting propounded is to formulate the grounds and reasons by interweaving the statutory words with relevant facts in respect of each element of the claim that the assessment is excessive. The book advocates for specific rather than exhaustive and compendious grounds. Pagone discusses the statutory form and content requirements for a valid objection together with relevant authorities.
Reviews & Appeals
The documentation for an administrative review to the Administrative Appeals Tribunal (AAT) or judicial appeal to the Federal Court of Australia (FCA) is fundamentally different. Unlike the FCA, the AAT is a merits review, is not bound by the rules of evidence and can exercise the Commissioner's discretions. The content of the application should reflect the difference in scope and power of the AAT and FCA.
The AAT application should state informative reasons in a way that links the claim to the facts and cannot be used adversely by the Commissioner. The statement of facts, issues and contentions, expert reports and witness statements should define the dispute and not be unnecessarily detailed.
An appeal from the AAT to the FCA is limited to a question of law and must be accurately identified and expressed. Writers should not confuse or couch errors of fact as errors of law or generalised questions of law too broadly and should link the legal principle engaged with the facts.
In the FCA, the appeal statement and statement of facts, issues and contentions should carefully differentiate between the functions of facts, law, grounds, issues and reasons and be linked by explanation. The link between facts and conclusions should be expressed not inferred.
Expert Opinion Evidence
The content and context of an expert opinion will vary according to its purpose and whether the potential reader is the taxpayer, tax agent, the Commissioner, opposing experts, the AAT or the FCA or successive readers, such as commercial third parties.
Expert opinion is an exception to the rule prohibiting opinion to establish a fact and requires the opinion to be based on demonstrable specialist knowledge founded in training, study and experience and to comply with obligations as to content and of independence.
Instruction to the expert may be discoverable. The instructions should be formulated to elicit usable answers relevant to the questions before the decision maker and to permit the decision maker to evaluate the opinion, analysis and explanation. A well-structured expert report may shape the proceedings and opposing expert reports.
Submissions
Submissions should be clear, consistent, informative and persuasive and should not be colorful or emotive generalisations, display erudition or write out the law or commentary.
Submissions to the Commissioner must be accurate, full and honest and avoid penalties and offenses for misstatements. The submission should not inadvertently waive client confidentiality or client privileges.
Submissions to the GAAR panel require difficult strategic and forensic decisions and commercial and business judgments to be balanced against the perceived utility of the process.
AAT and FCA submissions are governed by rules of court/tribunal, procedural requirements and court/tribunal orders. The content of the submissions and degree of referencing to evidence will depend on the context of the submissions. The submissions must explicitly link the legal propositions to the specific application of facts by reference to evidence. Submissions are an effective centralised resource tool for the advocate and the decision maker if done well and if done reliably.
A propounded method for presenting submissions is the CRAC method - (C)onclusion, (R)ule, (A)nalyisis, (C)ases (S. D. Stark, 1999).
A modified style example is:
(C)
The Applicant is entitled to a general deduction.
(R)
An amount is deductible when it is incurred in the derivation of income.
(A)
The amount was incurred in deriving income because it was for use of an item in
an activity from which assessable income was derived and tax was paid.
(C)
An amount is incurred on an item used in an activity when the taxpayer has
definitively subjected itself to the liability: s. 8-1 ITAA97; James Flood's
case.
The CRAC method directs the reader by stating the conclusion first, avoids lengthy quotations and emphasises the taxpayer's position rather than the Commissioner's position.
All submission should clearly state the orders, remedies or action sought.
Private Rulings
A private ruling application must include certain mandatory and minimum information and be sufficiently detailed to satisfy the authorised person that the decision is lawful, consistent with policy and ATO procedures and appropriate. The effective identification of the circumstances, duration and participants of the scheme in the application is imperative to bind the Commissioner and to facilitate any objection and review or appeal. Providing a draft ruling for the Commissioner to consider is useful and desirable.
High Court Special Leave Applications
The High Court of Australia special leave application must not only show legal error, but show the public importance of the principle in issue or that it is in the interests of justice to grant special leave. The formulation of the question in issue is fundamental and can have irreparable damage to an application.
The summary of arguments is vitally important and promotes effective legal writing because it is limited to 10 pages and a reply is limited to 5 pages. The contents must be concise, candid, comprehensive, refer to only established facts, avoid argumentative or emotive language and clearly distinguish between reasons (the merits of leave) and arguments (why and how the reasons are established).
Further Reading
S.
D. Stark, Writing to Win: the Legal
Writer, Three Rivers Press, 2012.
R. Jorgensen, ‘Objections and Written Tax
Advocacy’, (2010) 45/6 TIA 362.