Federal Court of Australia

Watson v Commissioner of Taxation [2026] FCA 1150

ORDERS

THE COURT ORDERS THAT:

1.    The interlocutory application submitted to the registry on 13 August 2026 be dismissed.

2.    The applicant pay the costs of and incidental to the attendance of the plaintiffs in Proceeding No QUD 492 of 2026 at the directions hearing on 14 August 2026, fixed in the sum of $1,500 and payable forthwith.

3.    The operation of order 2 above be stayed until the determination of any appeal instituted from these orders, or, if no appeal is instituted, until the expiration of 30 days from the date of these orders.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ROFE J:

1.    Introduction

1    This matter came before me in my capacity as duty judge.

2    The urgent interlocutory application by the applicant, Adam Bruce Watson, arises in the context of an application for an extension of time and for leave to appeal from the judgment of Needham J in Watson v Commissioner of Taxation [2025] FCA 1438, being Proceeding No NSD 2438 of 2025 Adam Bruce Watson v Commissioner of Taxation (the NSD Proceeding). The NSD Proceeding was commenced on 29 December 2025 and is presently docketed to S C Derrington J.

3    Yesterday, the New South Wales Registry referred a Certificate of urgency in support of listing before a duty judge dated 12 August 2026 (the Certificate) supplied by Mr Watson. Mr Watson, who appears on his own behalf, sought an urgent hearing before a duty judge in relation to proposed suppression and non-publication orders. In the Certificate, Mr Watson indicated that he was content for the matter to be heard urgently by a duty judge in either the New South Wales or the Queensland Registry.

4    The Certificate was accordingly referred to both the chambers of Needham J, being the general duty judge in the New South Wales Registry, and my chambers. However, given that the NSD Proceeding concerns an application for leave to appeal from the judgment of Needham J, it was not appropriate for the Certificate to be considered by her Honour. The matter therefore came before me.

5    The urgency asserted by Mr Watson arose from Proceeding No QUD 492 of 2026, Michael Joe Botica & Ors v Adam Watson & Ors, in which Mr Watson is the first named defendant (the QUD Proceeding). Mr Watson contended that relief was required in the NSD Proceeding before the next return of the QUD Proceeding on 19 August 2026 before Downes J. He further noted that S C Derrington J is presently on leave until 31 August 2026 and submitted that the application could not wait until her Honour’s return.

6    The Certificate contained a ticked box indicating that the matter was so urgent that it must be listed or heard without all the necessary documents being filed, but materials would be provided to chambers of the duty judge by 18 August or handed up during the hearing.

7    Having regard to the matters raised in the Certificate, and notwithstanding that no interlocutory application had at that time been processed by the Registry, I considered it appropriate that the matter be listed urgently for hearing today. The parties to the NSD Proceeding were notified that the matter was set down for directions before me today by email sent by my chambers yesterday evening.

8    The basis for the suppression order as set out in the Certificate was the filing of an affidavit affirmed by Scott David Guthrie in QUD Proceeding (the Guthrie Affidavit). Mr Guthrie is a Partner at Thomsons, the firm on record for the plaintiffs in the QUD Proceeding. The Certificate stated:

A solicitor, Mr Scott Guthrie of Thomsons Lawyers, acting for a party in QUD492/2026, has filed an affidavit in that proceeding referring to and relying upon material from [the NSD Proceeding]. Mr Guthrie is not a party to [the NSD Proceeding]. The Applicant is concerned the material is being deployed for a collateral purpose – to cast doubt on the Applicant before Justice Wheatley in QUD492/2026 and to reflect adversely on his reputation in a matter to which [the NSD Proceeding] has no proper relevance…

(emphasis added)

9    Because Mr Watson’s application made allegations of the improper use of material obtained from the NSD Proceeding against Mr Guthrie, I considered it appropriate to require an appearance on behalf of Mr Guthrie. I granted leave for the Commissioner of Taxation, the respondent in the NSD Proceeding, to be excused from appearing. In previous confidentiality applications involving the Commissioner before me, the Commissioner has adopted the position of neither consenting nor objecting to the orders sought. It was Mr Watson’s application, and he bore the onus to establish that the suppression order was appropriate.

10    A further email in relation to the hearing was sent by my chambers to the parties this morning in relation to expected appearances.

11    Shortly before the commencement of the hearing, my chambers contacted Mr Watson directly. Mr Watson advised that he was unaware that the matter had been listed and that he had not received the Court’s email correspondence in relation to the hearing. He further stated that he understood from communications with the Registry that the matter would not be listed unless the filing fee for the interlocutory application had first been paid.

12    Following the hearing, I reviewed the correspondence between Mr Watson and the Registry. That correspondence does not support Mr Watson’s understanding. Rather, the Registry had informed Mr Watson that sealed copies of the interlocutory application would not be returned to him until the filing fee had been paid. The correspondence did not state that the matter would not be listed pending payment of the filing fee. Notwithstanding that misunderstanding, I acknowledge that Mr Watson is a self-represented litigant and that the application had been brought before the Court on an urgent basis.

13    At the hearing, Mr Watson advised that he wished to rely upon an affidavit in support of the interlocutory application. No affidavit had been filed notwithstanding his indication to the Registry that he intended to file an affidavit by 10.30 am today. In those circumstances, I granted Mr Watson leave until 2.00 pm today to file and serve any affidavit material upon which he wished to rely and indicated that I would consider any such material before publishing reasons.

14    By correspondence to my chambers at 2.21 pm, Mr Watson forwarded a sealed copy of his affidavit material.

2.    Consideration

15    The relief sought by Mr Watson is extraordinary in its breadth. The application seeks suppression of the existence of the NSD Proceeding. In addition, Mr Watson seeks an order prohibiting the disclosure, by publication or otherwise, to any person who is not a party to the NSD Proceeding of:

(a)    any document filed in, or forming part of the Court file in, the NSD Proceeding; and

(b)    any information concerning the NSD Proceeding, including the existence, subject matter, procedural history and outcome of the NSD Proceeding.

16    The application is said to be founded upon s 37AF of the Federal Court of Australia Act 1976 (Cth) (the Federal Court Act). The power conferred by that provision is exceptional and may only be exercised where the statutory requirements are satisfied.

17    I have had regard to the affidavit affirmed by Mr Watson on 14 August 2026. In that affidavit, Mr Watson deposes that Mr Guthrie “…is not, and has never been, a party to this proceeding…”. He further deposes that he had become aware that Mr Guthrie had caused the Guthrie Affidavit to be filed in the QUD Proceeding which referred to the NSD Proceeding and matters said to be in issue within it. Mr Watson states that he applied to the Queensland Registry for a sealed copy of that affidavit and intended to rely upon it in support of his application once it became available. As I noted above, Mr Watson is a party in the QUD Proceeding.

18    Mr Watson further deposes that he is unable to say how Mr Guthrie came to have information about this proceeding and raises that matter as one of concern, whilst expressly stating that he makes no allegation. Mr Watson also deposes that his concern is that material concerning this proceeding is being deployed in the QUD Proceeding for a collateral purpose, namely, to cast doubt upon his credit before Wheatley J and to reflect adversely upon his reputation. He asserts that his taxation affairs and the procedural history of the NSD Proceeding are not in issue in the QUD Proceeding and that he is unable to identify any legitimate forensic purpose served by their introduction into that proceeding.

19    Those matters do not assist Mr Watson. First, Mr Watson’s affidavit does not identify any information said to have been obtained from the NSD Proceeding, let alone any information said to be confidential. Secondly, the affidavit proceeds upon an assumption that the Guthrie Affidavit refers to the NSD Proceeding and matters in issue within it. However, Mr Watson had not inspected Mr Guthrie’s affidavit when he commenced this application. Indeed, his affidavit indicates that he had merely applied to obtain a sealed copy of that document.

20    Thirdly, Mr Watson’s assertion that material may be being deployed for a collateral purpose is unsupported by evidence. His affidavit expressly acknowledges that he is unable to say how Mr Guthrie came to possess information concerning this proceeding and raises the matter only as a concern rather than as an allegation.

21    Even taking Mr Watson’s affidavit at its highest, it provides no evidentiary basis for the broad suppression and non-publication orders sought. Fundamentally, the factual premise upon which the application is brought has not been established.

22    Mr Watson’s complaint concerns the Guthrie Affidavit affirmed on 10 August 2026 and filed by the plaintiffs in the QUD Proceeding. The Guthrie Affidavit was directed principally to issues concerning Mr Watson's stated availability to participate in hearings in that proceeding. In particular, it referred to correspondence sent by Mr Watson to the chambers of Downes J on 6 August 2026 stating that he was unavailable until 14 August 2026 and contrasted that representation with statements made by Mr Watson to Wheatley J concerning his availability on 13 August 2026.

23    In support of that issue, Mr Guthrie conducted searches of publicly available court databases, including the Commonwealth Courts Portal and the New South Wales Online Registry. Those searches identified two proceedings involving Mr Watson in the Federal Circuit and Family Court of Australia, one proceeding in the New South Wales Court of Appeal and one proceeding in the New South Wales District Court. The affidavit exhibits information obtained from those publicly available sources.

24    On a separate issue, Mr Guthrie deposed to a 4 August 2026 email from Mr Watson to the associate to Wheatley J (and copied to Mr Guthrie) wherein Mr Watson stated that he had lodged an application in the Federal Circuit and Family Court of Australia (Div 2) that afternoon. Mr Guthrie’s search of the Commonwealth Courts Portal showed a proceeding (not the NSD Proceeding) had been commenced by Mr Watson in the New South Wales Registry of the Federal Court of Australia on 7 August 2026.

25    Significantly, the Guthrie Affidavit makes no reference to the NSD Proceeding at all. Nor does it disclose any information that is not publicly available. The information relied upon by Mr Guthrie was obtained from publicly accessible court databases and was relied upon for the limited purpose of addressing Mr Watson’s different statements as to his availability in the QUD Proceeding.

26    During the hearing, Mr Watson was unable to identify any information contained in the Guthrie Affidavit that was not publicly available. Nor was he able to identify any passage in that affidavit that referred to the NSD Proceeding.

27    To the contrary, the material before the Court demonstrates that the publicly available information relied upon by Mr Guthrie concerned proceedings other than the NSD Proceeding and was obtained from publicly available sources.

28    In those circumstances, there is no basis upon which I could be satisfied that suppression or non-publication orders are necessary, whether pursuant to s 37AF of the Federal Court Act or otherwise. There is no evidence of any misuse or threatened misuse of confidential information, no evidence of prejudice to the administration of justice, and no evidence of any circumstance capable of displacing the fundamental principle of open justice.

29    Mr Martin Taylor of counsel, who appeared on behalf of the plaintiffs in the QUD Proceeding and was instructed by Thomsons, raised a question as to the Court’s jurisdiction to grant the relief sought by Mr Watson. In Hogan v Hinch (2011) 243 CLR 506, French CJ (as his Honour then was) recognised at [21] that:

It has long been accepted at common law that the application of the open justice principle may be limited in the exercise of a superior court’s inherent jurisdiction or an inferior court’s implied powers…

(Citations omitted.)

30    It is unnecessary to determine the extent of any such jurisdiction in the present case. Even assuming that the Court possesses jurisdiction, whether pursuant to s 37AF of the Federal Court Act, its inherent jurisdiction or otherwise, to grant relief of the kind sought, there is no evidentiary or factual foundation upon which such relief could properly be granted.

31    As I have explained, the affidavit relied upon by Mr Watson does not identify any confidential information, does not establish that material from the NSD Proceeding has been deployed in the QUD Proceeding, and does not identify any circumstance capable of displacing the fundamental principle of open justice. It follows that the interlocutory application must be dismissed. Rule 2.32 of the Federal Court Rules 2011 (Cth) governs the inspection of documents filed in a proceeding by persons who are not parties to that proceeding. Mr Watson expressed a concern that any documents he files in the future in the NSD Proceeding may be accessible by Mr Guthrie or the plaintiffs in the QUD Proceeding. The Rules regulate the circumstances in which non-parties may inspect court documents and, in particular, do not confer a general right of access to all documents filed in a proceeding.

32    Nothing in these reasons prevents Mr Watson from making a suppression application to the docket judge in respect of specific documents to be filed in that proceeding at the time that they are filed, or when they are to be read in Court. Similarly, nothing prevents Mr Watson from making an application at the start of any future hearing in the NSD Proceeding that the matter be heard in closed Court.

2.1    Costs

33    As I have discussed, Mr Watson’s interlocutory application was based on the Guthrie Affidavit filed in the QUD Proceeding and sought relief on the basis that material from the NSD Proceeding had, in substance, been deployed in that proceeding. In these circumstances, I consider that it was appropriate for there to be an appearance from the parties affected by the allegations advanced in Mr Watson’s application. Mr Taylor submitted that the application was entirely without merit, and on that basis sought costs fixed in the amount of $1,500 on an indemnity basis.

34    It is well established that the Court retains broad discretion to orders costs in a proceeding under s 43 of the Federal Court Act. However, an order that a party pay costs on an indemnity basis is exceptional and will not be made as a matter of course. It requires conduct that is unreasonable in the relevant sense, such that the case falls outside the ordinary circumstances in which costs are awarded on a party-and-party basis: Graham Barclay Oysters Pty Ltd v Ryan (No 2) [2000] FCA 1220 at [13] (Lee, Lindgren and Kiefel JJ).

35    I consider that this is such a case. Mr Watson commenced and pressed for an urgent application for suppression and non-publication orders directed, in substance, to the Guthrie Affidavit filed in the QUD Proceeding. The application was brought before Mr Watson had obtained or reviewed the affidavit in question. After having reviewed the Guthrie Affidavit myself, it is apparent that it does not refer to the NSD Proceeding as alleged by Mr Watson and contains only information obtained from publicly available sources. The factual premise upon which the application was advanced was false and was therefore not established.

36    In LFDB v SM (No 2) [2017] FCAFC 207 at [7]–[12] (Besanko, Jagot and Lee JJ), the Full Court recognised that indemnity costs may be warranted where allegations are pursued without a proper foundation and thereby occasion unnecessary expense to another party. The present application falls within that category.

37    The allegations made against Mr Guthrie are wholly unsupported. The Guthrie Affidavit in question did not refer to the NSD Proceeding and disclosed only publicly available information. In those circumstances, the attendance of Thomsons was occasioned solely by an application lacking any proper factual foundation.

38    I am satisfied that the plaintiffs in the QUD Proceeding should recover the costs of their attendance today. Having regard to the wholly unmeritorious nature of the present application and the allegations advanced against Mr Guthrie, those costs should be awarded on an indemnity basis.

39    The amount sought, namely $1,500, is reasonable. Those costs should be fixed in that amount and be payable forthwith.

3.    Disposition

40    Accordingly, Mr Watson’s interlocutory application be dismissed.

41    The applicant is to pay the plaintiffs’ costs of attendance today, fixed in the sum of $1,500, and payable forthwith.

42    Mr Watson has expressed a desire to appeal from my orders in the event that I did not grant the suppression orders he sought. In order to preserve Mr Watson’s position in the event that he appeals and is successful in obtaining suppression orders, I will provide a copy of my reasons to Mr Watson and the Commissioner of Taxation and not publish my reasons until the resolution of any appeal, or 30 days from today in the event that Mr Watson does not appeal. For the same reason, I will order that the operation of the costs order be stayed until the determination of any appeal instituted from these orders, or, if no appeal is instituted, until the expiration of 30 days from the date of these orders.

43    Mr Guthrie will be provided with a copy of the orders made today, and the penultimate paragraph of these reasons.

Associate:

Dated:    14 August 2026