Federal Court of Australia

Safarimaznabi v Commissioner of Taxation (No 3) [2026] FCA 1479

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to r 39.04 of the Federal Court Rules 2011 (Cth), Order 3 of the Orders made on 9 June 2026 be set aside.

2.    The applicant pay the respondents’ costs of the first and third respondents’ interlocutory application filed on 17 December 2025 and of the second, fourth, fifth and sixth respondents’ interlocutory application filed on 17 March 2026.

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

REASONS FOR JUDGMENT

SARAH C DERRINGTON J:

Introduction

1    On 9 June 2026, the Court ordered Mr Safarimaznabi to pay the respondents’ costs (costs order) of the first and third respondents’ interlocutory application filed on 17 December 2025 and of the second, fourth, and fifth respondents’ interlocutory application filed on 17 March 2026: Safarimaznabi v Commissioner of Taxation (No 2) [2026] FCA 712 (Safarimaznabi (No 2)).

2    The respondents’ interlocutory applications (Strike Out Application) had sought orders striking out certain paragraphs of a consolidated statement of claim filed by Mr Safarimaznabi on 16 November 2025. The respondents were largely successful in their applications, but Mr Safarimaznabi was given leave to replead most of his claims.

3    At [58] of Safarimaznabi (No 2), I concluded that it was appropriate for Mr Safarimaznabi to pay the respondents’ costs because “the Strike Out Applications could have been avoided had Mr Safarimaznabi responded more appropriately to the respondents’ correspondence”. Prior to reaching that conclusion, the judgment sets out the conduct by Mr Safarimaznabi in the lead up to the Strike Out Applications and which informed the conclusion in relation to costs: Safarimaznabi (No 2) at [32], [35]-[36], [38]-[41].

4    By an email to the Registry dated 9 June 2026, Mr Safarimaznabi sought a variation of the costs order. By consent, on 22 June 2026, the Court ordered that the email be deemed to be an application under r 39.04(2) and r 39.05(c) of the Federal Court Rules 2011 (Cth). All parties filed written submissions and were heard at a case management hearing on 3 September 2026.

Varying or Setting Aside the Costs Order

5    Mr Safarimaznabi submits that the discretion to award costs against him should be re-exercised in circumstances where s 14ZZZC of the Taxation Administration Act 1953 (Cth) (TAA) is not referred to in Safarimaznabi (No 2) nor was it argued on the hearing of the Strike Out Applications. Section 14ZZZC provides:

14ZZZC Costs only if proceedings instituted vexatiously etc.

(1)     This section applies to a proceeding (including an appeal) in a court in relation to a matter arising under section 14ZZZA in which a person (the claimant) is seeking an order under subsection 14ZZZA(1).

(2)     The claimant must not be ordered by the court to pay costs incurred by another party to the proceedings, except in accordance with subsection (3) of this section.

(3)     The claimant may be ordered to pay the costs only if:

(a)     the court is satisfied that the claimant instituted the proceedings vexatiously or without reasonable cause; or

(b)     the court is satisfied that the claimant’s unreasonable act or omission caused the other party to incur the costs.

6    The Commissioner of Taxation and the Commonwealth (Commonwealth Respondents) acknowledge that Mr Safarimaznabi’s originating application seeks orders under s 14ZZZA(1)(f) and (g) of the TAA and therefore accept that s 14ZZZC applies to the proceeding. The Commonwealth Respondents submit that the omission of any reference to s 14ZZZC in the parties’ submissions, or the judgment, is sufficient to enliven the Court’s power under r 39.04 of the Rules to set aside or vary the costs order made on 9 June 2026, the application having been made within 14 days and there being a misapprehension of the law because of the parties’ failure to bring s 14ZZZC to the Court’s attention.

7    I accept that, in these circumstances, it is appropriate to set aside the costs order and to consider whether I am satisfied that Mr Safarimaznabi ought to be ordered to pay the costs of the Strike Out Applications having regard to the terms of s 14ZZZC.

8    For the reasons already given in Safarimaznabi (No 2), I am satisfied, in accordance with s 14ZZZC(3)(b) of the TAA, that Mr Safarimaznabi’s acts in relation to the manner and form in which he purported to deal with the respondents’ requests to remedy the deficiencies in his pleading were unreasonable and caused the respondents to incur the costs of the Strike Out Applications.

9    I am fortified in this conclusion by the multiple attempts made by the respondents to assist Mr Safarimaznabi, as a self-represented litigant, in formulating a proper pleading, including by providing him with a purpose-built Word template, which removed any ambiguity as to what was required when providing further and better particulars. Mr Safarimaznabi was also given an express warning that a strike out application would follow if he were unable to address the issues.

10    Mr Safarimaznabi submits that the chain of causation has been broken by the Order made on 9 June 2026 giving him leave to replead, and not merely to provide further particulars. He also submits that the “causation chain is further weakened” by a compromise proposed by the Commonwealth Respondents on 23 January 2026, and by almost 12 months of inaction by the Oakmoore Respondents since receiving extensive further particulars on 23 April 2025. Mr Safarimaznabi misunderstands the issue raised by the respondents; it is not simply that insufficient particulars have been provided, rather, it is the volume of evidence and submissions that has been rolled into purported particulars which made the pleading incomprehensible. That is the reason leave to re-plead has been given – to enable Mr Safarimaznabi to produce a comprehensible pleading in proper form. Mr Safarimaznabi’s obstinance, albeit courteous, in the proceeding to date is the cause of his unreasonable conduct. That conduct has caused the respondents to incur unnecessary costs.

Disposition

11    For these reasons, Mr Safarimaznabi should pay the respondents’ costs of the Strike Out Applications. There will be no order as to the costs of this application.

Associate:

Dated:    8 October 2026

SCHEDULE OF PARTIES