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Litigation – our policies

The ATO conducts and manages litigation in accordance with its obligations under the law, relevant court and tribunal rules, and ATO policies and guidelines.

Last updated 6 November 2018

The ATO conducts and manages litigation in accordance with its obligations under:

  • the law
  • the Attorney-General's Legal Services Directions 2017
  • the relevant court and tribunal rules
  • the relevant practice notes or directions
  • ATO policies and guidelines.

We strive to finalise all disputes in a fair, timely and equitable manner consistent with the law, using dispute resolution techniques to minimise litigation and related costs.

Conducting ATO litigation

Our practice statement, PS LA 2009/9 Conduct of Tax Office Litigation, sets out our approach and philosophy to litigation. It provides:

  • guidance to tax officers about our obligations to act as a model litigant under the Attorney-General's Legal Services Directions
  • the processes tax officers must follow to ensure those obligations are met, including how to engage external legal service providers.

The practice statement also explains our commitment to alternative dispute resolution (ADR) in litigation and discusses the various obligations that are imposed under the different court and tribunal rules.

See also:

  • PS LA 2009/9 Conduct of ATO litigation and engagement of ATO Dispute Resolution

Solicitor on the record

We will operate as the solicitor on the record in certain cases. A solicitor on the record, in relation to any party to proceedings, means the solicitor who is, for the time being, named as the party’s legal representative in the documentation for the proceedings.

Professional obligations

Our officers have the same professional and ethical obligations as any other legal practitioner. They must comply with the relevant legal profession legislation and any related regulations. They must comply with the Solicitors’ Rules and be familiar with the legislation that governs the conduct and obligations of their profession.

Legal services directions

We have obligations under the Legal Service Directions issued by the Attorney-General through the Office of Legal Services CoordinationExternal Link (OLSC). These are a set of binding rules about the performance of Commonwealth legal work – whether it is legal work performed:

  • in-house
  • by the Australian Government Solicitor (AGS)
  • by external legal providers.

The directions help to ensure that the Australian Government receives consistent and well-coordinated legal services that are:

  • a high standard
  • upholding the public interest
  • sensitive in the context of Commonwealth interests (which are broader than any one agency).

In turn, this approach protects the government's legal and financial position.

The ATO takes these obligations seriously and is proactive about initiating reports of potential breaches to OLSC. We also provide regular training to our legal services officers in their model litigant obligations. Taken together, these explain the higher rates of self-reporting of potential breaches and the relatively small number of determined breaches.

The directions cover matters such as:

  • briefing the Solicitor-General
  • recovery of costs
  • reporting on legal services expenditure
  • reporting on significant issues
  • principles of constitutional litigation involving Commonwealth Authorities and Companies Act 1997 (CTH) bodies
  • use of in-house lawyers for court litigation
  • model litigant obligations.

See also:

Model litigant

As an Australian Government agency, the ATO applies the highest standards of ethical behaviour when it is involved in litigation. Accordingly, our obligations in litigation matters go beyond those imposed upon private litigants.

Under the Legal Services Directions 2017External Link we have an obligation to act as a model litigant. This means that in handling claims and litigation, brought by or against us, we are required to act with complete propriety, fairness and in accordance with the highest professional standards.

Taxpayers and their representatives are advised of our model litigant obligations at the beginning of litigation. External legal service providers and counsel representing the ATO are also informed of their model litigant obligations at the time they are engaged.

See also: