Australian Taxation Office ( ATO ) agents have been found to have engaged in 'conscious maladministration' that resulted in a $ 30 million tax bill that 's now been quashed by the Federal Court . Documents were used subject to legal professional privilege in issuing the multimillion-dollar bill to an Australian businessman Garry John Donoghue . 'Garry , if you do n't pay me and my family , I will have no hesitation in giving the ATO everything I have on you . You should be very worried , ' his legal adviser Simeon Moore told Mr Donoghue before leaking his information to the Australian Taxation Office , the court heard . Australian Taxation Office ( ATO ) agents have been found to have engaged in 'conscious maladministration ' The Tax Office told Fairfax Media it would be appealing the decision . The Age reports that Mr Donoghue , 58 , a former Queenslander who is now living in London , ran a string of telecommunications businesses , including as the former managing director of listed mobile-services provider Plus SMS . He took the case to the Federal Court , arguing that Mr Moore , who was angry over alleged unpaid fees , passed on his file to the Tax Office . Federal Court Justice Logan found that the ATO assessment was invalid because it was based on information under legal professional privilege , and the ATO had no right to use it . The ATO assessment was issued for tax years 2005 to 2007 and amounting to over $ 30 million when taking account interest and penalties . The ATO 's decision resulted in a $ 30 million tax bill that 's now been quashed by the Federal Court . Mr Moore , who at the time was not admitted as a legal practitioner but was a friend of Mr Donoghue 's daughter , Alexandria , had issued Mr Donoghue with a bill for legal services amounting to $ 753,174 . Mr Moore and Mr Donoghue 's daughter , Alexandria were studying at Bond University in the Gold Coast together at the time . Justice Logan said this was 'outrageously extortionate ' and a 'fantasy ' amount given Mr Moore was an 'as-yet-not-admitted graduate undertaking post-graduate studies in law ' . The Tax Office said that it would be appealing the decision . He said the decision by the ATO officer to later proceed and use the information could be attributed to 'inexperience and zeal , coupled with a lack of relevant supervision and guidance ' . It had shown 'reckless disregard ' of a right for Mr Donoghue to claim legal professional privilege . Justice Logan quashed the $ 30 million tax bill and also ordered that the Commissioner of Taxation pay Mr Donoghue 's legal costs .
ATO agents have been found to have engaged in 'conscious maladministration ' Documents were used subject to legal professional privilege in issuing the multimillion-dollar bill . Court heard that an Australian businessman 's legal advisor leaked his information to the ATO . Federal Court Justice Logan found that the ATO assessment was invalid in this case . He found it was based on information under legal professional privilege , and the ATO had no right to use it .