He asked for an external review, signed a deed that did not give him one and then asked the Court to add it.
In 2003 a man asked the ATO how to treat an insurance payment he received for a work accident. The ATO ruled the payment was normal assessable income and he paid the tax. In 2020 the Commissioner decided the ruling had been wrong. He was repaid with statutory interest [1].
In 2023 he claimed compensation for defective administration. It was refused [2]. He sued twice, settled the second by deed, then sued to undo it [3]-[5].
Egan v Commonwealth of Australia [2026] FCA 1104.
The thing he kept asking for
On 7 July 2025 he wrote to the Commonwealth asking for fair compensation to be considered or an external review [42]. He wrote again that evening: if a review were approved he would accept the panel’s decision and close the matter [43].
What came back was a deed of settlement [45]. He replied that they had not commented on his request for an external review [47].
He asked for the review to be a term of the deed. It was rejected and he knew it was rejected [89]. He signed anyway.
Not in a panic. Wheatley J found he acted in a clear, calm and rational manner [97]-[98].
Then he asked a court for it
He wanted the deed varied so the Commonwealth would facilitate an external review, comply with its recommendation and answer to the IGTO internal review, with $300,000 only in the alternative [6].
Courts do not generally rewrite bargains [90]. That relief was gone before any ground was reached [91]-[92].
He advanced six bases [38]. On the summary judgment application she closed each the same way, that no real question of law or fact needed a trial [101, 156]. Error in the 2003 ruling could not reach the deed, which is not an administrative decision or action [155].
He used generative AI in his supplementary submissions, accepted he had not adequately verified all of the references and quotations and apologised unreservedly [11].
The line worth sitting with
“It may have been that the Commonwealth knew something that Mr Egan did not. That may have changed Mr Egan’s position. However, no duty arises in these circumstances” [116].
Not a finding that the Commonwealth disclosed everything. A finding that, negotiating a deed at arm’s length, it did not have to [115].
Worth considering
The Commonwealth’s open letter put his negligence claim “at least 15 years” out of time and said defective administration “is not a cause of action recognised by Australian courts” [127]. On the Commonwealth’s view, the 2020 correction came years after the remedy had gone.
The counterparty in that negotiation was the Commonwealth, acting for the Commissioner whose ruling was wrong.
General information only. This note was accurate when written. The law may have changed since and the note is not updated. It is not legal or tax advice, does not take account of your circumstances and must not be relied upon as a substitute for advice on your own matter. If the issue is live for you or your client, email arda@nortonquaytaxlaw.com.au for advice on the current position.