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Those limits were directed to matters like gearing ratios, liquidity ratios, funding and borrowing limits, credit risk and trading and dealing limits. Each of those charters had been formulated by the Board of the relevant Finance Group subsidiary and approved by the Board of the parent company, FGL. The charters were reviewed and amended from time to time. In the case of corporate entities the full name of the company is set out immediately before the relevant acronym or abbreviation where it first occurs. It was perceived that EFGA would have a higher credit rating than its subsidiaries separately enjoyed and would be able to borrow funds for the members of the Finance Group from external lenders more advantageously than those members individually could achieve. There was also some expectation that the holding company for the Finance Group might obtain a banking licence. Before the incorporation of EFGA, ELFIC Pty Ltd (formerly Elders Finance and Investment Co Limited) ("ELFIC") had carried on the business of a merchant banker and its activities included the receiving of surplus funds on deposit from other members of the Finance Group and the making of advances by way of loans at a margin as required to members of the Finance Group. However, the greater proportion of ELFIC's income by way of interest was derived by loans to third parties. By 30 June 1994, ELFIC's gross assets had grown to $690 million. After its incorporation and until about 2002, EFGA stood alone and separate from other entities in the Foster's Group as a corporation with its own statutory accounts. Also after its incorporation, EFGA succeeded to ELFIC's share of a US$500 million global note facility which had been raised as to US$300 million by FGL and as to US$200 million by ELFIC on behalf of the Finance Group. Upon its entry into that facility, EFGA, in February 1985, achieved a credit rating by Australian Ratings of A+. On 15 July 1985, a new charter was formulated for EFGA applicable to the whole of the Finance Group, each individual component of which was also given its own separate approved charter and cross-guarantees to a trustee were established between EFGA, ELFIC, Elders Rural Finance and Elders Lensworth Finance Limited Group ("Lensworth") which later became Lensworth Glenmore Park Limited and was a central company of the Lensworth Group which carried on the property finance business of the Elders Finance Group. EFGA also succeeded to ELFIC's role as a licensed participant in the money market and a foreign exchange dealer. It took until 1 July 1986 for the legal and systems requirements for that transfer to be implemented. By 30 June 1987, EFGA's creditors and borrowings had grown to about $1.4 billion and by 30 June 1988 to about $2.3 billion. Between 1985 and 1986, EFGA took over the conduct of treasury activities for the Finance Group. That involved it in making loans of about $700 million to ELFIC and $40 million to EFG Securities Pty Ltd ("EFGS") at benchmark rates like the Bank Bill Rate ("BBR") plus a margin. ELFIC in turn on-lent the funds to retail customers subject to credit limits set by the Board of EFGA and an obligation to submit monthly management reports to that Board. The fixing of interest rates charged to members of the Finance Group occurred at least annually and was intended to impose a discipline on EFGA executives to improve its performance as measured by a "profit" on the notional cost of capital employed. Finance Group subsidiaries were required to account for "losses" on defaulting loans to retail customers, which were set-off against "profits" derived from performing loans and other activities. EFGT had originally operated as a subsidiary of ELFIC but in July 1986 it passed into the direct control of EFGA. Mr van Wyngen described EFGT as a "profit centre" with a budget requiring a return on capital employed after all expenses, including head office cost allocations. He gave evidence that in early 1986, the budget for EFGT required it to make a profit contribution of nearly $3 million (before tax) to ELFIC, with around $10 million in revenue, $6 million in direct operating expenses and $1 million in allocated central expenses. As at 31 May 1986, EFGT was approximately $300,000 behind budget in terms of its net contribution . For the year ended 30 June 1988, EFGT made a direct management return (measured as revenue less transaction costs, standby costs, provisions and direct operating expenses) of $12.7 million. The return of EFGT's funding business, before overheads, was $8.5 million, compared with a budget of $2.4 million. For the year ended 30 June 1989, EFGT made a direct management return of $7.5 million, to which the funding business contributed $3.3 million . Following a report by PA Consulting Group dated 13 April 1989, the division of EFGT that conducted futures broking and trading was sold as it was no longer considered profitable. According to Mr van Wyngen, EFGT raised funds from several external sources, including prime corporations (being companies with a rating of "A-" or higher) and banks in the money and term deposit markets, discounting bills of exchange, retail deposits from the pastoral and trustee businesses and overseas bank lines. The funding obtained was on a mix of terms (tenor), ranging from 11.00 am and 24 hour call, through to term deposits of 12 months or more. The rate of interest on these funds depended on the tenor and the then applicable interest yield curve across the range of maturity terms. Each year, as part of the annual budgeting process, the Finance Group entities carrying on external lending activities forecast the funds required for each month over the following financial year. When funding was required, EFGT would process a pre-numbered deal ticket and provide the funds to the other entities, including ELFIC and EFGS, for lending to their customers. In April 1988, EFGT's Australian region balance sheet totalled $2.5 billion, which made it the biggest balance sheet for an Australian non-bank financial institution . EFGT's strategy for maximising profit was to pursue opportunities to raise funds at the lowest possible cost, anticipate interest rate changes, lend at higher yields and manage foreign exchange and interest rate risk. Further considerations included the need to maintain sufficient liquidity to comply with banking covenants and to be in a position to provide the funds required by the borrowing entities within the Finance Group at relatively short notice, as well as managing prudently to protect against unexpected turmoil in financial markets. According to Mr van Wyngen, a major technique by which profits were maximised was "gapping" or "mismatching". This involved anticipating movements in interest rates across a spread of maturity terms and exploiting differences between the rate at which money was borrowed by EFGT and on lent to external counterparties and other entities within the Finance Group, as well as Elders Resources Finance. This was managed across the portfolio by use of physical means like varying the tenor of liabilities and assets (such as bank and non-bank bills of exchange) and synthetic products, such as bank bill futures, forward rate agreements and interest rate swaps. From around 1988, capital adequacy guidelines for banks were introduced by the Reserve Bank of Australia, which required their assets to be risk weighted and gearing limited to 12.5 times capital. This made funding cheaper for banks (which had a lower risk weighting), and more difficult to obtain and more expensive for non-bank financial institutions such as EFGA (which was not under the control of the Reserve Bank of Australia and had a higher risk weighting). From around 1988, Mr van Wyngen advised that EFGA should obtain a banking licence to avail itself of these benefits. Lending transactions occurred between EFGT and external counterparties for the purpose of managing EFGT's liquidity. The counterparties were banks, prime merchant banks, finance companies and prime or near prime companies for which credit limits had been approved by credit personnel based in the Finance Group's Melbourne office. The loans were nearly always lent on "11 am" or "24 hour" call and were unsecured. The terms able to be agreed by EFGT were governed by an operating charter, which set out the lines of authority, operating limits, and approved product mixes . Funding was provided to other entities in the Finance Group, such as ELFIC and EFGS, by way of loans at interest. From 1986 to 1990, the interest charged was normally calculated by applying a particular margin to the 90 day BBR on a monthly basis. In early 1986, the margin above BBR had been set at 0.7%. The margin was changed to 0.6%, with effect from October 1986. In addition, a charge was agreed to be paid by the borrowing entities for the facilities which were required to be held by the Finance Group to have sufficient liquidity to meet the funding requirements of the borrowing entities. Finally, a "penalty" rate was payable if the borrowing entity required materially less or more funding from EFGT than forecast in the budgets. Interest accruing on loans from EFGA (through EFGT) to other entities in the Finance Group was ordinarily calculated on a daily basis, and capitalised monthly. Where funding was provided by EFGT to a borrowing entity for a specific loan by the borrowing entity to a customer, there was a risk of a differential between the timing of interest receipts and payments. Although interest was capitalised monthly on balances owed by the borrowing entities to EFGT, it was not paid until the borrowing entities received funds from their clients. However, EFGT was at liberty to exploit the interest rate risk in how it sought its own funding, for example by "gapping". The term of loans to other entities in the Finance Group was 24 hour call except for matched funded loans or where specifically agreed otherwise. In substance, this meant that the money was rolled over from day to day, with the borrowing entity being responsible for repaying the loans irrespective of how it employed the funds. The loans to other entities in the Finance Group were unsecured. Mr van Wyngen gave evidence that the amount and type of security required from customers was determined and administered by the borrowing entities as part of their normal external lending businesses. In all cases, the credit risk was borne by borrowing entities. If an amount was not paid by a customer, the borrowing entity remained liable to EFGT for principal and accrued interest on the loan provided by EFGT. In late December 1989, Dresdner Bank agreed to purchase the business of EFGT (except for its funding operations). Mr van Wyngen transferred with the rest of the EFGT operations to Dresdner Australia, and was subsequently appointed Managing Director when the sale was completed in early 1990. Between July 1985 and June 1986 the activities of companies in the Finance Group expanded considerably, enabling EFGA to report a profit for that financial year of approximately $34.2 million. By May 1987 the management of the Finance Group had been restructured along regional lines with a separate Regional Managing Director and Regional Board for each of Australia, New Zealand, Asia, the United Kingdom / Europe and the United States of America. Each region had its own treasury. By 30 June 1987, the total assets of the Finance Group had grown to approximately $4.1 billion and the net operating profit to about $64 million. The share market crash of October 1987 thwarted a proposal to split the Foster's Group into four separate publicly-listed companies, one of which would have been the Elders Finance Group. Several companies in which the Finance Group had shareholdings were affected by the share market crash. However, there was little concern about the solvency of the Finance Group itself as its capital and reserves were regarded as sufficient to absorb those losses. In spite of the stock market crash and the abandonment of the proposed demerger of FGL, EFGA continued to grow steadily. In the year ended 30 June 1988, the Finance Group was the largest merchant banker in Australia, reporting a record profit of $63.4 million and assets of $5 billion and, as at 30 June 1989, EFGA had 141 subsidiaries principally in Australia and New Zealand with some located elsewhere in the world. In the three years ending 30 June 1989, EFGA's consolidated accounts recorded significant net operating profits for the Finance Group. In the same period ELFIC and EFGS earned substantial net income but incurred significant interest expenses almost exclusively on intra-group loans which were used as circulating capital in their businesses. In the year ended 30 June 1988, ELFIC suffered an operating loss of $15 million and a loss on extraordinary items of $24 million including a write-down in investments in subsidiaries (one of which was EFGS) of $19 million. In the same year EFGS suffered an operating loss of $12 million. However, not all the companies in the Finance Group sustained losses in that period. The Lensworth Group, with activities in the property sector, recorded increased operating profits in 1988 as a result of which the assets of the Lensworth Group increased by something of the order of 30%. By the year ended 30 June 1989, ELFIC's operating loss had grown to $86 million and that of EFGS to $8 million. EFGA, however, still recorded a consolidated profit for the Finance Group in the same year of $81 million, largely derived from the continuing profitability of the Lensworth Group. In June 1989, EFGA provided additional share capital of $80 million to ELFIC which, in turn, provided additional share capital of $20 million to EFGS. By that means both subsidiaries reported positive net assets as required to preserve their money market dealers' licences. In late 1988, Australian Ratings downgraded EFGA's credit rating from "A+" to "BBB+" and in January 1989 indicated its intention to downgrade EFGA's credit rating further in response to concerns about the quality of its assets and the impact of new capital adequacy guidelines. Those guidelines required each bank to maintain a certain level of capital, depending on the risk weighting accorded to its assets. EFGA had a higher risk weighting because it was treated as a corporate borrower rather than a bank. As a result, lenders charged higher rates of interest to EFGA, which, in turn, had to charge its customers higher interest rates than those charged by banks. Australian Ratings ultimately did not further downgrade EFGA's rating. Nevertheless, the Finance Group went ahead with plans to become a specialist merchant bank, entailing a cap on assets as at 30 June 1989 and a reduction in total assets of $1 billion by 30 June 1990. In the 1989 financial year, EFGA posted a consolidated profit before tax of $90 million. However, EFGS and ELFIC both suffered net operating losses and required capital injections from EFGA to enable the companies to report positive net asset positions and retain the licences required to operate their businesses. After the middle of 1989, FGL, at the request of EFGA, and prompted by external lenders' having declined to renew EFGA's debt financing, provided EFGA with a standby facility of $400 million at an interest rate of 2% above the BBR and on condition that EFGA reduced the facility to $250 million by October 1989. Although that reduction was apparently achieved, a further tightening of the liquidity of the Finance Group necessitated an increase, in December 1989, to $500 million in the standby facility provided by FGL to EFGA. In August 1989, Harlin Holdings Pty Limited ("Harlin") launched a bid for FGL and subsequently attained a 55.82% shareholding. The takeover bid boosted the Finance Group's ability to access the funds required for the orderly sale of assets. However, the Finance Group's liquidity and funding position continued to decline in the face of increased customer defaults, a depressed economy and ongoing funding commitments. In August 1989, a $400 million standby loan facility was granted by FGL to EFGA, under which interest was charged at a margin of 2% above the then applicable BBR. In November 1989, Australian Ratings downgraded FGL's credit rating to "BB/B.1" and EFGA's credit rating to "BB-/B.1". As a result, EFGA's loans no longer fitted the investment criteria of its major lenders and banks began to withdraw funding. After the downgrade, the Board of EFGA agreed to accelerate the strategic sell-down of the Finance Group's assets in order to continue its operations. A steering committee was formed to downsize the Australian and New Zealand businesses and coordinate reductions and sell-offs in other regions. Between January and March 1990, the steering committee oversaw the sale of the Finance Group's assets. During this period, the Finance Group subsidiaries cut back their lending activities and concentrated on funding existing committed liabilities. However, EFGA continued, where required, to make loans at a margin to the Finance Group subsidiaries. In March 1990, FGL announced its plan to focus solely on its brewing business and divest itself of all of its other businesses, including those conducted by the Finance Group. As a result, many lenders to the Finance Group, caught off-guard by the announcement, sought to switch existing external lines of credit to FGL. At that stage, external funding of the Finance Group was over $3 billion. In order for EFGA to realise the Finance Group's assets and maximise shareholder returns, it became necessary to repay facilities as they matured and, to the extent that asset sales could not fund this, to draw on alternative funding from FGL. Between February and April 1990, funding to EFGA by FGL doubled to approximately $301 million. On 22 March 1990, the Board of EFGA established the Reduction of Asset Management Committee ("RAMCO") to facilitate the expeditious realisation of assets, disposal of businesses and repayment of debt. RAMCO had equivalent authority to the EFGA Board and continued to meet till July 2004. In May 1990, the directors of the companies in the Finance Group called on FGL to provide them with letters of comfort so that they could sign the statutory accounts referable to companies in the Finance Group. By 30 June 1990, the Finance Group's assets had fallen to $2.7 billion following the sale of the Australian treasury operation, the Australian trustee business and stockbroking businesses in Australia, New Zealand and the United Kingdom. At this stage, the realisation of the Finance Group's assets was expected to be completed by 30 June 1990. The debt owed by EFGA to the Foster's Group was now $435 million, comprising the sum of direct liabilities of $417 million and bank borrowings transferred from EFGA to the Foster's Group of $18 million. This was forecast to increase to $820 million by 31 July 1990 and, thereafter, gradually reduce and be fully repaid by 30 June 1992. The increase in debt to the Foster's Group was largely the result of external bank funding being withdrawn or not being renewed and facilities being transferred to, or replaced by, new funding from the Foster's Group. As well, FGL provided a guarantee of performance of the obligations of Finance Group companies to certain creditors to preserve lines of credit from those creditors. That was done rather than increasing the share capital of the Finance Group companies because of the risk that such equity funds might have become available to third party litigation creditors of companies in the Finance Group. Until this time, EFGA had been charging the Finance Group companies at its cost of borrowing plus a margin of 0.6%. From 1 September 1990, EFGA continued to charge interest but provided further moneys at cost of funds with no margin. In July 1990, another wholly owned subsidiary of FGL, Amayana Pty Ltd ("Amayana") made a loan of $34.8 million to EFGA using funds which Amayana had borrowed from its subsidiary, FBG Treasury Aust Pty Ltd ("FBGT"). Both the loan from FBGT to Amayana and that from Amayana to EFGA were at the standard intra-company interest rates charged by FBGT. The refinancing of the Finance Group's commitments during the latter half of 1990 became a major drain on FGL's funds. However, had ELFIC, Lensworth or Elders Rural Finance defaulted under the US$ Denominated Note Global Facility noted at [7] above, cross-default clauses could have been triggered imperilling the financial viability of the whole Foster's Group. Money raised from the sale of assets to external purchasers and the transfer of assets to other members of the Foster's Group, as well as from the repayment of customer loans, was used at this time to repay bank loans, to continue funding to external customers where appropriate and, to the extent available, to repay funding provided by the Foster's Group. However, the necessity of acquiring assets from debtors in settlement of their debts hindered the Finance Group's realisation program because such property assets had to be managed and took time to realise. By July 1990, the Board of EFGA had formed the view that, because of the depressed Australian property market, the Lensworth Group's property book could not be sold at that time except on "fire sale" terms and prices. Other assets of the Finance Group were sold off, more than half of them by June 1990, and those sales enabled the balance of debts owed to EFGA by members of the Finance Group, other than ELFIC, EFGS and Lensworth, to be reduced to nil by 1992. EFGA continued to lend to Finance Group subsidiaries to fund their existing liabilities to external customers where termination of the facilities could not be negotiated, and continued lending to customers if the further amount would not only be repaid but also assist the recovery of the entire amount outstanding. Up until around July 1992, RAMCO's terms of reference did not impose limits on the amounts that could be advanced to existing customers, although they were typically loans of under $1 million. In July 1992, RAMCO's terms of reference were amended and authority limits were introduced formalising the process for approving additional loans to existing customers. These additional loans to existing customers were funded by loans from EFGA to the relevant Finance Group subsidiaries (including ELFIC and EFGS). Generally, the sources of the funds for these additional loans were either the proceeds of asset realisations, or funds drawn by EFGA from the Foster's Group. During 1991, the Finance Group suspended customer accounts for non-performing loans, ceasing to record interest as income where there were doubts about the relevant customers' ability to continue paying interest. This impinged on EFGA's profit and loss statement as funding costs continued to be recognised. However, the customers were still expected to repay the principal amount and the suspended interest. In March 1991, EFGA reported a deficiency of shareholders' funds. This was due to the allocation of significant provisions to closing down costs and doubtful debts. Furthermore, the interest payable to the Foster's Group on funds advanced to the Finance Group exceeded the interest received from customers whose loan accounts had been suspended. In April 1991, EFGA made a request to the Foster's Group for $400 million in interest-free funding, in order to eliminate a budgeted loss for the 1992 financial year and to prevent external auditors from requiring additional provisioning of $60 million in the Finance Group accounts. That proposal was rejected by the Board of FGL. In early 1991, concerns were also raised about the unsecured nature of loans provided by the Foster's Group to the Finance Group, which would rank equally with the debts of any litigation creditors. As the level of debt rose, obtaining security for the debts owing by EFGA to the Foster's Group was made a priority. By this stage, the amount due to the Foster's Group had increased to nearly $1.4 billion, vastly exceeding the original forecast of $820 million. This was attributed to a slowdown in asset sales as a result of the economic downturn, and a miscalculation of the volume and speed at which the banks would withdraw their funding support of the Finance Group. Pursuant to the refinancing arrangements, EFGT became, in May 1991, the funding conduit to EFGA. The Foster's Group took security over EFGT's assets in respect of the debt owed by EFGT to the Foster's Group. In turn, EFGA and certain Finance Group subsidiaries guaranteed EFGT's obligations to the Foster's Group and granted charges over their assets to support those guarantees. The Foster's Group thereby became a secured lender with an entitlement to realise the assets of EFGT and the Finance Group subsidiaries should EFGT default in its repayment obligations, enabling the Foster's Group to continue to fund the Finance Group without exposing the additional loan funds to the claims of third party litigants. From October 1991, loans were made by the Foster's Group to the Finance Group through EFGT under a Security Note arrangement. EFGA and some of its subsidiaries, including ELFIC and EFGS guaranteed repayments by EFGT under these arrangements and gave charges over their assets to secure their obligations under the guarantees. The effect of these arrangements was to cause loans by FGL to EFGA and AML Finance Corporation Limited ("AML Finance") and by AML Finance to EFGA to be repaid and replaced with loans by FGL to EFGT secured over the bulk of the assets of EFGA and its subsidiaries in the Finance Group and by EFGT to EFGA. By 30 June 1991, it had become apparent that EFGA, ELFIC and EFGS each had, or was likely to have, a deficiency of net assets of $194 million, $808 million and $40 million respectively. On 12 August 1991, the FGL Board gave "in-principle" approval to the provision of a letter of comfort to the Finance Group subsidiaries. The directors of EFGA, ELFIC and EFGS subsequently formed the view that those companies would be able to pay their debts as and when they fell due, and signed off on their accounts. By September 1991, the recession was hindering the asset realisation program and increasing the incidence of defaults by customers unable to meet their repayment obligations to the Finance Group companies. Price Waterhouse, as auditors of EFGA, concluded that general provisions should be increased by between $35 million to $50 million above the existing provisions of $62 million. FGL had made a loss of $43 million in the year ended 30 June 1991 and had no accumulated distributable reserves. As payment of a dividend without the consent of lenders could have been a breach of banking covenants, the FGL Board resolved not to pay a dividend for the 1991 financial year. After the security structure noted at [41] above had been implemented in October 1991, it was decided to pursue an orderly realisation of the Finance Group's assets rather than aggressively selling down those assets. Between 1991 and 1998, the performance of the remaining assets of the Finance Group continued to be monitored by RAMCO and, as thought appropriate, Finance Group companies were directed to foreclose on securities held over properties of defaulting external borrowers. Additional finance was provided by EFGA to some external customers to enable them to maintain assets which could not yet be sold at acceptable prices. Although the asset realisation program had, by mid 1992, bought about an improvement in the net liability position of the Finance Group, it was perceived by then that the program would have to be extended to mid 1997 before it could be completed. After Australia, the United Kingdom and the United States had gone into recession in 1991, the Board of EFGA determined that the Lensworth Group's property business should be realised over a period of time with the other residual assets of the Finance Group. Accordingly, the RAMCO and Lensworth Group assets were brought under one management organisation and the time frame for the orderly realisation strategy was extended to between five and seven years. Before 1992, the advances from the Foster's Group to the Finance Group had outstripped the repayments. However, after July 1992, the Finance Group's principal repayments and interest payments to the Foster's Group outpaced the additional advances. The cash was being generated from realising loans, selling assets where the Finance Group had security and selling other assets and businesses of the Finance Group. By December 1991, the undrawn funding commitments of the Finance Group had dropped from $900 million to $185 million. In June and August 1992, in response to concerns about EFGA's solvency, all staff were transferred from EFGA to EFGT. The human resources reshuffle coincided with Harlin's going into receivership on 6 July 1992 and the acquisition of its shares in the Foster's Group by BHP Limited. In September 1992, the Board of FGL approved an increase in provisioning of $360 million to cover additional specific provisions, additional general provisions and work out costs, and $300 million for future funding costs. At about the same time, FGL provided another letter of comfort to enable the Finance Group directors to sign off on their respective company accounts. Over time, a portion of the provisions was in fact reversed, thereby realising profits for the Finance Group. On 15 September 1992, FGL made a rights issue to raise new capital which was successful in raising $1 billion. That enabled a large portion of FGL's debt to be repaid and effectively brought FGL's liquidity problems to an end. Throughout 1993 and 1994, the continuation of the asset realisation program resulted in a net cash outflow from the Finance Group to the Foster's Group. New strategies were developed to maximise the realisable value of assets over which the Finance Group had security before the Finance Group decided, in 1995, to retain the land holdings which had been acquired in order to enhance their value through rezoning and development. Nevertheless, EFGA continued to make losses, except for the 1995 year, generally due to provisions for the decline in value of investments and loans and bad debt write-offs. ELFIC and EFGS continued to record losses because their intra-company debts exceeded income from their business activities. Despite this progress, it remained necessary to obtain comfort that the Foster's Group would continue to provide financial support to the Finance Group companies that were net asset deficient so that the directors of those companies could sign off on the statutory accounts. It was at around this time that EFG Financial Limited ("EFG Financial"), a subsidiary of ELFIC Holdings BV and a Finance Group company incorporated in Cyprus, was in the process of being sold. As at 31 March 1996, EFG Financial's trial balance recorded debts owing to it by EFGA in the amounts of US$66,306,653.04 and US$35,620,265.31. In preparation for the sale of ELFIC Holdings BV and its subsidiaries, the debts owed by EFGA to EFG Financial were assigned from EFG Financial to Amayana for $1. Under the security structure described at [41] above, FGL continued, until 30 June 1998, to charge interest on its loans to EFGT. In turn, EFGT continued to charge interest on its loans to EFGA. The existing loans from Amayana to EFGA remained unpaid and were unsecured. The loans by FGL to EFGT were at interest and the interest so charged was returned as assessable income by FGL. From time to time, EFGT made payments and repayments reducing the balance of its debts from about $1,143 million to about $842 million by 30 June 1998. Subsequent payments by EFGT between 1999 and 2001 amounted to $61,830,522. EFGT, in turn, charged interest on intra-group loans from it to, in particular, EFGA. That interest was included in EFGT's assessable income. Substantial payments and repayments on account of those debts were made by EFGA to EFGT between October 1991 and 30 June 1998. Loans were also made at interest from FBGT to Amayana which on-lent the borrowed funds, also at interest, to EFGA. The interest was included in Amayana's assessable income. Although payments and repayments were made from time to time on behalf of EFGA to Amayana, EFGA's total indebtedness to Amayana rose from about $251 million in 1991 to about $325 million in 1998. EFGA made available to subsidiaries in the Finance Group, particularly ELFIC and EFGS, the funds which it had borrowed from EFGT and Amayana. EFGA charged interest to the borrowers and returned such interest as assessable income. In early 1998, Mr Neufeld, who was Senior General Manager within the Finance Group from 1995 to 2001, conducted a "recoverability review" to assess the prospects of recovering debts owed respectively by ELFIC and EFGS to EFGA, by EFGA to EFGT and by EFGT to FGL. He assessed ELFIC's "best case" recovery at $92 million being $54 million from external customers and $38 million from related party customers. In the same way, Mr Neufeld assessed the "best case" recovery of EFGS at $6 million, all from one external customer, and that of EFGA at $197.2 million from all assets, not merely from loans to ELFIC and EFGS. EFGT's "best case" recovery was similarly assessed at $208 million, all from related party customers. In the light of those assessments, Mr Neufeld thought that, of the amount of $1.29 billion owed by ELFIC to EFGA, $1.2 billion should be written off as a bad debt. Similarly, he recommended that $99 million of the $106 million owed by EFGS to EFGA should be written off and $657 million of $850 million owed by EFGA to EFGT should be written off. Mr Neufeld considered that $268 million of the debt of $843 million owed by EFGT to FGL was recoverable. He also recommended that the interest on the outstanding balance in each instance be reduced to nil. In substance, those recommendations as to write-offs were adopted. As well, in the 1999 financial year, Amayana wrote off as bad the entirety of the debt owed to it by EFGA apart from the assigned debts acquired by Amayana from EFG Financial; see [51] above. The write-off was said to be justified by the fact that any proceeds from the realisation of debts due to EFGA and its subsidiaries were to be applied in repayment of secured loans to EFGA from EFGT which, in turn, was obliged to use the repayments to it in reduction of its liabilities to FGL. From September 1997, and during 1998, an allocation of repayments made by EFGS and ELFIC to EFGA, by EFGA to EFGT and by EFGT to FGL was undertaken on the basis that repayments specifically appropriated to a particular debt or loan should be applied in reduction or elimination of that debt or loan. Remaining payments attributed to interest were allocated to reduction of interest liabilities on a first-in first-out basis and any surplus was applied in reduction of unpaid principal and interest also on a first-in first-out basis. If any balance remained, that was also allocated to repayment again on a first-in first-out basis, of outstanding principal and unpaid interest. After that process had been completed, the balance (if any) assessed by Mr Neufeld as part of the "recoverable amount" was notionally applied, also on a first-in first-out basis, to reduction of the outstanding liabilities for principal and unpaid interest. The interest charged by EFGA to ELFIC and EFGS, by EFGT and Amayana to EFGA, by FGL to EFGT and by FBGT to Amayana was treated as an expense in the profit and loss statements of each of the debtor companies. ELFIC and EFGS claimed deductions for the same interest from their assessable incomes and those deductions were included in the losses said to have been incurred by those companies which were transferred to other companies in the Foster's Group. Similarly, EFGA claimed deductions for unpaid principal and interest due from ELFIC and EFGS which had been written off as bad debts. The unpaid interest component of those debts had previously been returned by EFGA as assessable income. EFGA also claimed deductions from its assessable income of liabilities for interest which it had incurred to Amayana. The combined deductions claimed by EFGA resulted in tax losses which were transferred to other companies in the Foster's Group. EFGT and Amayana, in turn, claimed deductions for the interest charged on loans to them from FGL and FBGT. Having respectively included in their assessable incomes from 1992 to 1998 interest on loans made to EFGA, they claimed deductions in respect of the interest due from that company which had later been written off as bad. There was no claim for a deduction by either EFGT or Amayana of amounts of principal due from EFGA which had been written off as bad. However, the deductions claimed by EFGT and Amayana contributed to tax losses which were subsequently transferred to other companies within the Foster's Group. Correspondingly, FGL had included in its assessable income from 1992 interest on loans which it had advanced to EFGT. It claimed a deduction in 1998 in respect of interest on those loans which had been written off as bad which contributed to another tax loss which was also transferred to another company within the Foster's Group. The accounts for EFGT for the year ended 30 June 1996 recorded a loss of $1.1 billion resulting from a large provision for doubtful debts in relation to the receivables due from EFGA to reflect the likely level of recovery. In August 1996, the Board of EFGT agreed to make a provision for $1.12 billion and the Board of FGL provided further confirmation of its ongoing support. To address the fact that all operating Finance Group entities had become net asset deficient by 31 October 1996, Lensworth Group Limited was established. On 26 March 1997, Lensworth Group acquired from EFGT the shares in the parent companies of the various land holding entities and late in that year the profits derived by Lensworth Group ceased to be reported as abnormal items and were disclosed as ordinary income of the Foster's Group on the basis that the property development activities by then constituted an ongoing business. The Foster's Group continued to charge interest on the existing debts owed by the Finance Group even though the interest was extremely unlikely to be recovered. That course of action was justified on the basis that the realisation process was drawing to a close and the litigation risks appeared to have reduced with the settlement of several matters. As at 30 June 1998, ELFIC owed EFGA debts totalling $1,294,441,115. On 19 June 1998, the $1,202,441,115 that ELFIC could not pay or repay EFGA was written off as bad, and the interest rate on the debts reduced to nil per cent per annum by the Board of EFGA with effect from 30 June 1998. " An objection by ELFIC to each of those assessments was disallowed on 9 February 2007 when the Commissioner also declined to remit the penalty tax imposed on ELFIC under Division 10 of Part VII of the 1936 Act . The Taxpayer argues that the amount of $95,293,880 is deductible in the relevant year under subsection 8-1(1) of the Income Tax Assessment Act 1997 (''the ITAA 1997"). In consequence, the Commissioner has made a valid determination under paragraph 177F(1)(b) of the ITAA 1936. The determination was issued to the taxpayer on 12 December 2006. It was determined that EFGS was not entitled to a deduction in that year of $6,804,054 being interest on loans from EFGA. An objection to that assessment was disallowed on 9 February 2007 for the same reasons, mutatis mutandis, as those given in relation to ELFIC which are reproduced at [64] above. The appeal to this Court against the objection by EFGS to that assessment is the proceeding numbered VID 135 of 2007. It was determined that EFGA was not entitled to a deduction for that year in respect of bad debts written off on account of debts totalling $1,202,441,116 owed to EFGA by ELFIC and a further $100,009,231 owed to EFGA by EFGS. That claim to a deduction was described in the Commissioner's notice dated 9 February 2007 of disallowance of an objection to the assessment as the "bad debts claim". In consequence, the Commissioner has made a valid determination under paragraph 177F(1)(b) of the ITAA 1936. The determination was issued to the taxpayer on 12 December 2006. That claim was described in the notice of disallowance of EFGA's objection as the "interest deduction claim". In consequence, the Commissioner has made a valid determination under paragraph 177F(1)(b) of the ITAA 1936. The determination was issued to the taxpayer on 12 December 2006. In consequence, the Commissioner has made a valid determination under paragraph 177F(1)(b) of the ITAA 1936. The determination was issued to the taxpayer on 12 December 2006. An objection to that assessment was disallowed on 9 February 2007. In consequence, the Commissioner has made a valid determination under paragraph 177F(1)(b) of the ITAA 1936. The determination was issued to the taxpayer on 12 December 2006. An objection to that determination or assessment was disallowed on 9 February 2007. One of the Entities ("the loss company") had claimed that, pursuant to a Loss Grouping Agreement, it had transferred to the Taxpayer a tax loss of $30,213 during the relevant year. Accordingly, the Commissioner considers that, as no tax losses were available for transfer to the Taxpayer during the relevant year, the Taxpayer's claim for a deduction under sections 170-20 and 36-17 of the Income Tax Assessment Act 1997 ("the ITAA 1997") or the equivalent provisions under the Income Tax Assessment Act 1936 ("ITAA 1936") must fail. In consequence, the Commissioner has made a valid determination under paragraph 177F(1)(b) of the ITAA 1936. The determination was issued to the Taxpayer on 12 December 2006. The Commissioner, by an assessment issued on 18 December 2006, similarly disallowed the deduction claimed by Ashwick in the 1998 year as a result of the transfer of a tax loss from FGL to Ashwick. An objection to that assessment was disallowed on 9 February 2007. The Commissioner's reasons, as recited in the notice of disallowance, were, mutatis mutandis, the same as those reproduced at [71] above. Ashwick's appeal against that disallowance is constituted by the proceedings in this Court numbered VID 124 of 2007. By a notice of amended assessment issued on 21 December 2006, the Commissioner disallowed the deduction of $145 claimed by Ashwick for the year ended 30 June 2001 as a result of the transfer to Ashwick from EFGA and EFGT of tax losses of $70 and $75 respectively. An objection to that amended assessment was disallowed on 9 February 2007. The Commissioner's reasons, as recited in the notice of disallowance were, mutatis mutandis, the same as those reproduced at [71] above. Ashwick's appeal against that disallowance is constituted by the proceedings in this Court numbered VID 125 of 2007. The Commissioner had earlier disallowed the deductions of $70 and $75 for the tax year ended 30 June 2001 which are referred to at [73] above. On 27 October 2005 Ashwick objected to that disallowance and, by notice dated 31 May 2006, was advised by the Commissioner that "As 60 days have now passed since the Commissioner was given the notice [of objection], the Commissioner is taken to have disallowed the objection. " Ashwick's appeal against that deemed disallowance is constituted by the proceedings in this Court numbered VID 861 of 2006. Nexday's objection to that assessment was disallowed on 9 February 2007. Accordingly, the Commissioner considers that, as no tax losses were available for transfer to the Taxpayer during the relevant year, the Taxpayer's claim for a deduction under sections 170-20 and 36-17 of the Income Tax Assessment Act 1997 (" the ITAA 1997") must fail. Nexday's appeal to this Court against the disallowance of its objection is constituted by proceedings numbered VID 126 of 2007. EFGT objected to the assessment in relation to both aspects of the claimed deduction and on 9 February 2007 the Commissioner disallowed the objection. EFGT's appeal to this Court against the disallowance of its objection is constituted by proceedings numbered VID 131 of 2007. EFG Investments objected to that assessment and, on 9 February 2007, the Commissioner disallowed the objection. One of the Entities ("the loss company") had claimed that, pursuant to a Loss Grouping Agreement, it had transferred to the Taxpayer a tax loss of $739,340 during the relevant year. Accordingly, the Commissioner considers that, as no tax losses were available for transfer to the Taxpayer during the relevant year, the Taxpayer's claim for a deduction under sections 170-20 and 36- 17 of the Income Tax Assessment Act 199 7 ("the ITAA 1997") or the equivalent provisions under the Income Tax Assessment Act 1936 ("ITAA 1936") must fail. EFG Investments' appeal against the disallowance of its objection is constituted by the proceedings in this Court numbered VID 127 of 2007. It is convenient to examine each of those issues separately and in order making, as required in relation to specific taxpayers, findings of fact in addition to those summarised from [5]-[63] above. Deductions for these debts written off as bad were claimed pursuant to either s 25-35(1)(a) or (b) or s 8-1 of the 1997 Act . It was submitted on behalf of EFGA that the outstanding loans which gave rise to the ELFIC/EFGA Bad Debt Deduction had been advanced by EFGA to ELFIC to facilitate and enhance collection of loans which had been made earlier by EFGA to ELFIC in the ordinary course of EFGA's business of lending money, and that, accordingly, the loss or outgoing incurred by writing off the amount of $1,202,441,115 was a loss or outgoing incurred by EFGA in the course of a business for the purpose of deriving assessable income. On 19 June 1998, the $100,009,231 that EFGS could not pay or repay to EFGA was written off as bad, and the interest rate on the debts reduced by the Board of EFGA to nil per cent per annum with effect from 30 June 1998. EFGA claimed a deduction of $100,009,231 for the whole of the amount written off in the calculation of its taxable income for the 1998 year (the "EFGS/EFGA Bad Debt Deduction"). Deductions for these debts written off as bad were claimed pursuant to either s 25-35(1)(a) or s 8-1 of the 1997 Act . (b) approximately $47,470,559 was the balance of loans claimed to have been made by EFGA to EFGS in the ordinary course of EFGA's business of lending money and which were not able to be repaid and therefore written-off as bad. Deductions for these debts written off as bad were claimed pursuant to either s 25-35(1)(a) or (b) or s 8-1 of the ITAA 1997. It was submitted that the outstanding loans which gave rise to the EFGS/EFGA Bad Debt Deduction had been advanced by EFGA to EFGS to facilitate and enhance collection of loans made earlier by EFGA to EFGS in the ordinary course of, EFGA's business of lending money, and that, accordingly, the loss or outgoing incurred by writing off the amount of $100,009,231 was a loss or outgoing incurred by EFGA in the course of a business for the purpose of deriving assessable income. Seven of the companies in the Foster's Group claimed to have incurred tax losses in various tax years from 1996 to 1999 as a result of the transactions detailed in [88], [85] and [86] above. In other words, a principle of "first-in, first-out" ("FIFO") was applied except for the financial years ending 30 June 1992 and 30 June 1993 when it appears that payments received from the debtor entities were applied in reduction of their respective liabilities for interest. It has been contended on behalf of the Commissioner that no part of the principal component of each debt written off by EFGA had been advanced before 1 January 1990. It is said to flow from that proposition that all advances of principal from EFGA to ELFIC and EFGS, having been made after 1 January 1990, had been made after the Finance Group had ceased trading normally and while it was in the process of an "orderly realisation of assets. " Accordingly, it was said on behalf of the Commissioner that the deductibility of the advances of principal by EFGA to each of ELFIC and EFGS after 1 January 1990 turns on whether those advances were made in the ordinary course of a business of lending money conducted by EFGA which is the test erected by s 25-35(1) of the 1997 Act . (ii) If yes to (i), did EFGA's business of lending money continue during the winding up period? (iii) If yes to (ii), were the advances made to ELFIC and EFGS after 1 January 1990 made in the ordinary course of that business of lending money? It borrowed money from a variety of sources outside the Finance Group and on-lent the money so borrowed to ELFIC and EFGS (amongst others) at interest. It also lent money to external borrowers on the short term money market which was not immediately required to be deployed within the Foster's Group. As well, it accepted on deposit from entities within the Foster's Group, including ELFIC and EFGS, moneys which were surplus to the immediate business needs of those entities. It was acknowledged on behalf of the Commissioner that EFGA's activities in conducting a treasury operation were intended to yield a profit, but that intention, it was said, had to be evaluated in the context of EFGA's essential function which was to obtain debt funding "in a centralised fashion" for the benefit of other companies in the Finance Group which were themselves to carry on businesses of lending money. Counsel for the Commissioner emphasised evidence in the form of contemporary documents dating from October 1984 including Board papers, statements of objectives, EFGA's operating charters and a request for stamp duty exemptions which make clear that the primary function of the company which became EFGA was conceived to be its establishment in the financial markets as a substantial centralised borrowing unit which could raise borrowed funds more cheaply and efficiently than individual entities within the Foster's Group. Another advantage of the interposition of a central treasury between operating entities of the Foster's Group and the sources of borrowed funds was seen to be the elimination of competition for funds between those entities in the external money market. It was considered that the benefit of the resultant savings could then be passed on to operating companies within the Foster's Group which would be on-lending to external customers the funds passed from the centralised borrowing unit, EFGA. The Commissioner placed considerable emphasis on the fact that the margin above the cost to EFGA of externally borrowed funds which EFGA charged the operating entities, including ELFIC and EFGS, was "negligible" --- of the order of 0.60%, which prompted certain executives in charge of the central treasury to express views to the effect that it was "illusory" to suggest that funding of internal entities made a profit for EFGA. Similar views were expressed to the effect that "funding" would always lose money. Reference was made additionally, in the same context, to the absence of any separate accounting within EFGA of the income derived from on-lending within the Foster's Group as distinct from the income derived from loans on the short-term money market to external parties. Although management accounts and budgets showed the difference between the cost of funds and interest earned from on-lending those funds, that difference was negligible in amount having regard to the "massive" sums which were on-lent to the internal entities. As well, the Commissioner pointed to the absence of any allowance in the management accounts or budgets by way of provision for bad or doubtful debts or otherwise in respect of the risk of non-repayment by one or other of the internal entities and the failure to attempt any "rigorous measurement" of EFGA's revenue relative to its expenses. A related consideration was said to be the fact that EFGA's massive on-lending to ELFIC and EFGS between 1987 and 1989 was maintained in the face of slender and diminishing ratios of assets to liabilities of each of those members of the Foster's Group. It was no answer to that consideration, the Commissioner argued, that any inability by ELFIC or EFGS to repay principal or pay interest on borrowed funds could be rectified by an injection of capital by EFGA. Counsel for the Commissioner also contended that the evidence suggested that the primary function of the attribution or identification of a "profit" within the management accounts of EFGA was as a crude measurement of performance by treasury staff and a basis for rewarding them with bonuses. The Commissioner contrasted the "unbusinesslike" approach of EFGA to loans to ELFIC and EFGS as internal entities with the controls and protocols imposed on the lending by those companies to external customers. It was suggested that no prudential limits, terms of lending or security requirement were imposed in respect of loans by EFGA to entities within the Foster's Group so as to reflect the borrowers' "weak and deteriorating balance sheets. " Also indicative of a similar lack of businesslike concern with the risk of lending was said to be the absence of any adjustment from time to time of the rate of interest charged to internal borrowers by reference to the degree of risk. Rather, the rate was set by agreement between EFGA and the borrowing entity having regard to the rate at which the borrower would, itself, have been able to obtain funds on the open market. It was also pointed out on behalf of the Commissioner that the margin of 0.60% charged to internal borrowers within the Foster's Group was not a mark-up or margin on top of the cost to EFGA of the borrowed funds. Rather, it was added to the 90-day BBR and represented, after allowing for expenses, only a minuscule total addition to the amounts advanced. It represented, on the Commissioner's case, no more than a "break-even" target or even less when account was taken of the revenue derived by EFGA from loans to non-related parties. These factors, in combination, were said to provide a strong contra-indication of engagement by EFGA in a "business of lending money. " EFGA's involvement in making loans to external borrowers on the short-term money market was said not to be available to support its engagement in a business of lending money because that activity was purely ancillary to the making of loans to entities within the Foster's Group. It would not have occurred but for EFGA's central treasury function and was part of active management, in the role of an arbitrageur, of borrowing and interest rate fluctuations. (II) DID EFGA CONDUCT A BUSINESS OF LENDING MONEY DURING THE WIND-UP PERIOD? In pressing for a negative answer to this alternative question, the Commissioner pointed to the fact that all of the principal advanced, and interest charged to ELFIC, which was written off as a bad debt by EFGA, had been advanced after 30 June 1990. A similar conclusion was available in respect of most of the principal and interest payable by EFGS which had been written off. After June 1990, EFGA radically changed the nature of its business. It ceased to borrow funds from external lenders and looked, instead, to lenders within the Foster's Group. It conducted its activities through RAMCO for the benefit of the Foster's Group as a whole, rather than of EFGA's own business. Consistently with that change, it ceased lending to make a profit. That was done by eliminating, from 1 September 1990, the inter-entity interest rate margin, including that charged to ELFIC and EFGS. The Finance Group's treasury business, other than the funding of internal entities, was sold on 31 January 1990 to the Dresdner Bank. That change of course by EFGA was said to be consistent with an announcement by the Foster's Group, on 8 March 1990, that it would concentrate on its brewing business and divest itself of all its other businesses. From then on, EFGA focused on selling assets and recovering loans which it had made to external borrowers. Although EFGA's assets had been reduced from $5.9 billion at 30 June 1989 to $2.7 billion at 30 June 1990, its assets realisation program was slowed by the deepening recession to a point where it was estimated, in February 1992, as likely to take from five to seven years to complete. Part of that projection reflected a decision to maximise the value of certain real properties which had been acquired from the Emanuel Group by re-zoning and developing the land which was recognised as requiring to be done over an extended time. Although new loans were made during the wind-up period by EFGA to internal borrowing entities, they were made to enable those entities to continue to meet obligations to external third parties from which a discharge could not be negotiated or to enhance the borrowing entities' prospects of recovering debts from third parties. RAMCO's activities during the wind-up period were conducted for the benefit of the Foster's Group as a whole and not solely for the benefit of EFGA. This was illustrated by RAMCO's assumption of management of the Lensworth Group and the establishment of Lensworth Group Limited as a direct subsidiary of FGL rather than as a subsidiary of EFGA. In contending that the loans to ELFIC and EFGS were not made in the ordinary course of EFGA's business of lending money, the Commissioner submitted that the loans were not advanced "with a view to making any real economic return" or "commercial profit" from the internal borrowers. Rather, they were made as a cheap and efficient provision of funds to the borrowing entities which, themselves, carried on businesses of lending money. EFGA's placement of surplus funds on the short-term money market was characterised as "minimising liquidity risk" and "hedging against interest rate and foreign exchange risks. " It followed, according to the Commissioner, that the loans to ELFIC and EFGS had been made as part of a commercial activity of EFGA which was not a discrete business of lending money. When EFGA's activities are analysed in the way required by Fairway Estates Pty Ltd v Federal Commissioner of Taxation [1970] HCA 29 ; (1970) 123 CLR 153 , there could not be imputed to EFGA an intention to carry on the business of lending money along with other activities. This, I am satisfied was an actual intention of its subscribers and not merely a precautionary inclusion of an object in its memorandum along with a large number of other possible courses of action. The appellant's association with United, having regard to the activities and financial resources of that company, confirms the view that the appellant intended throughout to carry on the business of the lending of money as opportunity offered. There was no express reference in the various operating charters formulated for EFGA to its carrying on a business of lending money. Nor did EFGA exhibit the systematic and continuous conduct of a commercial activity "capable of being described as, in effect, business operations intended to yield a profit"; see Richard Walter Pty Ltd v Commissioner of Taxation [1995] FCA 1370 ; (1995) 95 ATC 4440 per Tamberlin J at 4458. The Commissioner also pointed to the fact that EFGA had a relatively low level of equity of its own and derived its borrowing capacity from its position as the holding company of the Finance Group supported by cross-guarantees from companies within the Group and from the ultimate parent company. As well, the Commissioner relied on what was said to be a lack of relevant skills and expertise among EFGA's executives in the conduct of a business of lending money. Those qualifications were argued to include experience and capacity in assessing the creditworthiness of borrowers and in managing the risks of a portfolio of loans. The skills of the relevant personnel was said to be confined to the performance of treasury functions. In a related way, the Commissioner instanced the absence of limits on lending to a particular internal entity, of the assessment of creditworthiness of the borrowers and of the application of other techniques of risk management. Those features were explained as reflecting the fact that EFGA made its loans to internal entities at the direction of FGL, "the ultimate holding company of the wider Foster's Group. " Those features of the arrangements between EFGA and the internal borrowing entities were said to be similar to those in Hungier v Grace [1972] HCA 42 ; (1972) 127 CLR 210 where the borrower proposed the period of the loan and the rate which, irrespective of that period, was to be paid by way of interest. It did not reflect any appreciation of the risk of non-repayment and was not charged at all after 1 January 1990. The funding provided by EFGA to, amongst others, ELFIC and EFGS, although nominally at call, was committed indefinitely and its repayment depended on the recovery by the borrowing entities of advances made to their external customers. EFGA had no discretion to advance loan funds to internal borrowers or to withhold them. The risk of non-repayment was entirely assumed by internal borrowers like ELFIC and EFGS. According to the Commissioner, the placement of money on the short-term money market was purely ancillary to its activities as a central treasury and did not qualify EFGA as a participant in a separate business of lending money. In that sense, the observations of Hill J in Kidston Goldmines Ltd v Commissioner of Taxation (1991) 30 FCR 77 were said to be applicable to EFGA's participation as a lender in the external money market. Its activities of putting out money on the short-term money market were an adjunct to this goldmining business, and not of themselves a separate business activity. As noted at [23] and [101] above, the foreign exchange and currency options business formerly carried on by EFGA apparently through its subsidiary EFGT was sold to the Dresdner Bank on 31 January 1990. That was part of a sell-down, between 1990 and 1998, of all the Foster's Group non-brewing businesses and coincided with EFGA's ceasing, in early 1990, to place funds with external borrowers in the short-term money market. Thereafter, the continued lending of money to ELFIC and EFGS at no cost to those entities was simply a deployment of assets within the Foster's Group to facilitate an orderly realisation or divestment of assets and a concentration on its core business of brewing. It was an isolated transaction of a very special character undertaken at the behest of the company to which it was a subsidiary and the debt which arose is not to be regarded as occurring in the conduct of any money-lending business in which the taxpayer was otherwise engaged by virtue of its taking mortgages from purchasers. Merely to preserve assets is not, at least in the circumstances of this case, to carry on a business. There is nothing to show that the activities of the appellant went beyond the keeping of the net assets with which it was left when its only business, the wholesale trading business, came to an end. In support of this contention, the Commissioner pointed to aspects of EFGA's activities on which he had relied in support of earlier, related, arguments. Particular emphasis was placed on EFGA's apparent absence of independent judgment as to whether or not to advance the loans or whether, or when, to call them in. It was also contended that EFGA was unconcerned with making an "economic profit" from the internal loans or with how repayments, when made, were allocated. These features of EFGA's activities, the Commissioner suggested, reflected the making of the loans at the direction of FGL solely to fund the subsidiaries in the most economical way. In other words, the continuing funding of ELFIC and EFGS after January 1990 was solely to prevent the financial failure of the Foster's Group as a whole and was not made to effect any business purpose of EFGA. According to that submission, the moneys had actually been advanced with the intention that principal would be repaid and interest would accrue and be paid. Moreover, such repayments and payments were actually made but not to the full extent of the principal advanced and interest accrued. In relation to the requirement imposed by s 25-35(1)(b) of the 1997 Act , it was contended on behalf of EFGA that it had, between 1986 and 1998, carried on a substantial business of lending money. The nature of that business did not materially change during the "wind down" or orderly realisation of the assets of the Finance Group. Even during that period, EFGA continued to make new advances as well as receiving repayments of principal and payments of interest in respect of existing loans. The debts from ELFIC and EFGS which had been written off were in respect of advances made to those companies before and after March 1990. It was submitted, in the alternative, on behalf of EFGA that the principal and interest components of the debts which had been written off were deductible under s 8-1 of the 1997 Act. It was said that the debts which had been written off were a product of the carrying on of EFGA's business of borrowing and lending and the loans which gave rise to the bad debts were part of a collection of such funds which had been used to produce assessable income. Neither the principal nor the interest component of the relevant bad debts, according to EFGA, had constituted a loss of capital or of a capital nature. Rather, the loan funds were "circulating capital" in the sense used by Kitto J in National Bank of Australasia Ltd v Federal Commissioner of Taxation [1969] HCA 11 ; (1969) 118 CLR 529 , at 537 so that the loss was on revenue account. Counsel for EFGA contended, in the further alternative, that, if the interest and principal written off as bad debts were not wholly deductible, at least the interest component of each such debt was deductible under either s 8-1 or s 25-35(1). The latter sub-section was said to be applicable to the interest component of each bad debt because the interest had been returned as part of EFGA's assessable income in a previous year. By 1986 it had assumed the treasury function for the Finance Group and as part of that function made very large loans to ELFIC and EFGS. Also, a function ancillary to the making of loans of that kind, it borrowed from external lenders and managed its liquidity by lending or depositing surplus funds on the external short-term money market. Of particular significance is the fact that it lent to internal borrowers like ELFIC and EFGS at a margin above the cost of funds to it which was designed to return a "profit". The prescription of the rate of expected profit by other entities within the Foster's Group which meant that it did not necessarily represent EFGA's assessment from time to time of what the market would bear, does not detract from the fact that EFGA's activities were carried on with a degree of system and continuity or repetition which a Full Court of this Court in Commissioner of Taxation v Bivona Pty Ltd (1990) 21 FCR 562 , citing Edgelow v MacElwee [1918] 1 KB 205 , at 206, regarded as an indication of the carrying on of a principal business of lending money. Nor do I regard it as critical that almost all of the loans by EFGA were made to other subsidiaries of the Foster's Group. The failure to make provision in EFGA's accounts for bad or doubtful debts owed by borrowers within the Foster's Group was explicable by the common enterprise in which the Group was engaged and the fact that there were no separate shareholders who might look to individual subsidiaries, including EFGA, for a dividend. Similar considerations explain the maintenance between 1987 and 1989 of high levels of advances to ELFIC and EFGS notwithstanding the diminishing individual creditworthiness of those subsidiaries. It is not to the point, in my view, that an activity has been carried on in an "unbusinesslike" or inefficient manner. The distinction as McCardie J suggested in Edgelow v MacElwee , supra, at 206 is between loans to relations, friends or acquaintances or otherwise on an occasional and disconnected basis and loans made with the requisite degree of system and continuity to import the carrying on of a business. On this analysis, I have concluded that EFGA before 1990 lent money to ELFIC and EFGS in the ordinary course of EFGA's business of lending money. Nor have I been able to conclude that the activities of EFGA during the wind-up period were otherwise than in the ordinary course of its business of lending money. It is true that during that period EFGA ceased to charge the previous inter-entity rate of interest on loans to Finance Group borrowers but that was merely in recognition of the precarious financial states of those subsidiaries and the need for EFGA to make its own contribution to a quick and effective realisation of group assets. There was, I consider, an actual and continuing intention by those managing EFGA to carry on during the wind-up period its business of lending money although the carrying on of the same business was directed to a different end or purpose. In that sense the intention of those controlling EFGA during the wind-up period coincided with that regarded by Barwick CJ in Faraway Estates Pty Ltd v Federal Commissioner of Taxation (1970), supra, at 163, as satisfying the relevant test. That EFGA carried on its activities during the wind-up period at the direction of others, including, ultimately, FGL does not entail that it ceased during that period to carry on its former business of lending money. It was merely directed to carry on the same business for different purposes which included the winding up of its own business at the core of which was the lending of money, the recovery of principal advanced and accrued interest thereon. The leaving of funds with ELFIC and EFGS was still a mode of employing those assets in the sense suggested by Brennan J in Northern Engineering Pty Ltd v Federal Commissioner of Taxation [1979] FCA 79 ; (1979) 42 FLR 301 , at 304. The employment during the wind-up period of funds advanced to ELFIC and EFGS was not profitable for EFGA as it had been before 1990 but that does not entail that a change occurred in the character of the business pursuant to which the funds had been advanced. Nor, contrary to the Commissioner's submission, did it entail that the loans to ELFIC and EFGS after 1990 were no longer advanced in the ordinary course of lending money. For these reasons I have been led to conclude that the principal and interest owed to EFGA by ELFIC and EFGS which had been written off were deductible under s 25-35(1) of the 1997 Act. I am reinforced in that conclusion by the fact that, throughout the relationship of creditor and debtor, moneys were actually advanced to ELFIC and EFGS and in part repaid by them together accrued interest, albeit not the full amount of such interest. In light of the conclusions which I have just reached, it is unnecessary to consider the alternative submission advanced on behalf of EFGA, that the debts owed by ELFIC and EFGS which were written off as bad were wholly or partly deductible under s 8-1 of the 1997 Act . Submissions similar to those for EFGA were advanced in support of this claim to a deduction by EFGT. The bad debts were said to be deductible under s 25-35(1)(a) or, alternatively, under s 8-1 of the 1997 Act . It will be recalled that EFGT became the conduit for loan funds provided under a Security Note by the Foster's Group to EFGA as part of the security structure erected in 1991 as described at [41] of these reasons. The loans from EFGT to EFGA were made at interest and EFGT in turn paid interest under the Security Note facility at a rate of 1.5% above the 90 day BBR. Further advances were made by the Foster's Group to EFGT after October 1991 and a further Security Note for $0.5 billion was executed in respect of those further advances in August 1992. The further funds were on-lent by EFGT to EFGA which continued to be charged interest to the end of the 1998 financial year. EFGT similarly continued to be charged interest during the same period on the further funds advanced to it by the Foster's Group. EFGT also accepted, in addition to the funds borrowed under the security structure, moneys on deposit from other members of the Finance Group and incurred a liability for interest on those deposits. In each year from 1993, except 1996 and 1997, EFGT made substantial operating profits from its activities. However, in 1996, it recorded a massive operating loss of $1,119,511,434 and in the following year a smaller, but still significant, operating loss of $1,284,849. In the same period its total reported expenditure by way of interest was almost identical in each year to its reported income in the form of interest. The greater part of that interest in each year appears to have been incurred on borrowings from FGL. In opposing EFGT's claim to a deduction to the bad debt written off in respect of the interest due from EFGA, the Commissioner relied on the submissions, so far as applicable, which he had advanced in respect of the claim by EFGA for a bad debts deduction. He also relied generally on certain factual conclusions that were said to be available in relation to the capacity of ELFIC, EFGS, EFGA, EFGT and Amayana to pay interest and principal on their inter-company loans. In the first place, it was pointed out that each of the loans was repayable at call. As indicative of the straitened circumstances of companies within the Finance Group, the Commissioner pointed to the fact that, in May and June 1990, the directors of the Finance Group had sought a letter of comfort from FGL and had only been prepared to sign the solvency statements in the statutory accounts of members of the Finance Group after FGL, on 20 June 1990, passed a resolution that FGL would support the subsidiaries. A letter dated 6 July 1990 from BHP was said to indicate a belief by that company that loans by FGL to Finance Group subsidiaries would be repaid. Other indications from the evidence were relied on as tending to establish that, during 1990, EFGA, EFGS and ELFIC had, or were likely to have, a net deficiency of assets and from 31 December 1990, EFGA "had begun to suffer a deficit" of $13 million in shareholders' funds. One of the consequences was that Amayana would not be able fully to recover its receivables from EFGA. The Commissioner also relied heavily on a report by Mr Meredith, a financial analyst, who demonstrated that, in the year ended 30 June 1990, ELFIC's available assets totalled $522 million whereas its liability to EFGA in respect of principal and interest amounted to $992 million. The discrepancy widened in subsequent years to a point where, by 30 June 1997, ELFIC had no available assets from which to make repayments. A similar deteriorating pattern of incapacity to pay obtained in respect of EFGS. In consequence, by 30 June 1997, EFGA's capacity to repay principal and interest on loans to it from Amayana had been reduced to 11% of the total liability. Mr Meredith's approach to assessing EFGA's capacity to pay was defended by the Commissioner as reflecting realistic prospects of recovering loans from subsidiaries as discernible from their statutory accounts rather than having regard to provisions made by EFGA for loans which were not fully recoverable. Those provisions were characterised by the Commissioner as mere "balancing items" which provided no true guide to the recoverability of loans made by EFGA to ELFIC and EFGS. Counsel for the Commissioner also discounted the applicants' contention that Mr Meredith's approach failed to take account of the possibility that assets disclosed by the statutory accounts might be realised for more than their book values. It was pointed out that the assets comprised loans of fixed amounts and, in any event, were realisable for the benefit of FGL rather than the Finance Group. Another issue raised by Mr Meredith's evidence centred on his assumption that two loans to EFGA by internal entities, EFGT and Amayana, ranked equally. Although EFGT held security over EFGA's assets and Amayana did not, the Commissioner contended that the security granted to EFGT was merely a device to defeat external creditors. In support of this contention, the Commissioner instanced the fact that FGL did not exercise its powers under a charge from ELFIC despite the occurrence of a "trigger" event, namely ELFIC's having become unable to pay its debts as and when they fell due. The Commissioner also pointed to EFGA's having made repayments under the loan to it from Amayana despite the fact that the much larger loan from EFGT remained outstanding. In further reliance on Mr Meredith's evidence, the Commissioner claimed that, between July 1990 and July 1998, Amayana lacked the capacity to repay in full money which it had borrowed from FBGTA and on-lent to EFGA. Over the period in question, on Mr Meredith's analysis, Amayana's capacity to meet its liability to FBGTA had declined from 41% of the loan balance to only 11%. A similar analysis led Mr Meredith to conclude that, between 1992 and the financial year ending on 30 June 1996, EFGT's capacity to repay to FGL moneys which EFGT had on-lent to EFGA had declined from about 25% to a mere 1%. The difference between Mr Meredith's analysis and the statutory accounts of Amayana and EFGT, according to the Commissioner, was explicable by the fact that EFGT did not raise provisions against its assets until the financial year ended 30 June 1996 when it raised a provision of $1,120,000,000 and Amayana never raised such a provision but allowed its net assets to be recorded as represented by its paid-up capital of $2. In the light of the matters to which he drew attention, the Commissioner invited the conclusion that, from early to mid 1990, the Finance Group was unable to pay its debts as and when they fell due and that, without FGL's support, external lenders would have refused further credit and have begun calling up existing debt as it became enforceable, thereby forcing the companies in the Finance Group into liquidation. On the Commissioner's analysis, the "real loss" between 1991 and 1998 was incurred by ELFIC and EFGS when loans which they had made in the course of their respective money lending businesses proved irrecoverable. As a result, ELFIC and EFGS were unable to pay interest or repay capital on loans made directly or indirectly to them by other companies within the Foster's Group. This inability was at all times known to those directing the affairs of the Foster's Group who, nevertheless, continued, until 1998, to make inter-group loans and to allow accrued interest to be capitalised. The Commissioner also claimed that the "tax loss", presumably of the Foster's Group as a whole, had been "magnified" because each company in the funding chain had been able to write-off amounts for internally generated debts in the form of interest which had not been paid. That "magnifying" effect was also said to have been compounded by the delay, until 1998, in writing off the debts and ceasing to debit the borrowing companies with further instalments of interest. On the assumption that each relevant taxpayer had not been carrying on a business of lending money, the Commissioner disputed that s 25-35(1)(a) of the 1997 Act had any application to the debts in respect of unpaid interest. In the first place, it was contended that there was no reasonable prospect that the interest returned as assessable income by creditor companies would be received. That was because EFGA lacked capacity to pay interest from time to time because of the inability of ELFIC and EFGS to recover enough under the loans due to them to reimburse EFGA in respect of advances respectively made to ELFIC and EFGS. In this context, the Commissioner relied on Permanent Trustee Co (Executors of F H Prior dec) v Federal Commissioner of Taxation (1940) 6 ATD 5 , Cross (Inspector of Taxes) v London & Provincial Trust Ltd [1938] 1 KB 792 and Henderson v Federal Commissioner of Taxation (1969) 119 CLR 612 per Windeyer J, at 637. The second proposition on which the Commissioner relied in this context was that interest recognised as having accrued is not derived for tax purposes until it has been received. In the present case, there was no "coming home" or "coming in" to the taxpayer in a realisable form of an amount representing interest on the loans in question; cp, The Commissioner of Taxation (SA) v The Executor Trustee and Agency Company of SA Limited [1938] HCA 69 ; (1938) 63 CLR 108 and St Lucia Usines & Estates Co Ltd v Colonial Treasurer of St Lucia [1924] AC 508 , at 512. The Commissioner accepted that taxpayers who carry on a business of lending money are excepted from the general rule that interest is only assessable when received and are obliged to return interest as income as it accrues. However, this exception was said to be available, even arguably, only to EFGA which, for the reasons summarised at [104]-[110] above, was not engaged in a business of lending money. It followed, according to the Commissioner, that it is not open to a taxpayer to invoke s 25-35(1)(a) in consequence of a mistaken return of interest as income in a given year. An assessment giving effect to a mistaken return of that kind in a given year should be amended and any claim to write off as a bad debt the interest so returned should be disallowed. An alternative contention advanced on behalf of the Commissioner was that the amount of the deduction available under s 8-1 of the 1997 Act is limited to the loss suffered by the taxpayer. It was said that the debts in the form of unpaid interest written off by EFGA, EFGT and FGL as at 30 June 1998 and by Amayana in July 1998, did not give rise to any loss for the purposes of s 8-1 because the receivables were valueless when brought to account. Support for this proposition was said to be derived from J Rowe & Son Pty Ltd v Federal Commissioner of Taxation [1971] HCA 80 ; (1970-71) 124 CLR 421 and BHP Billiton Petroleum (Bass Strait) Pty Ltd v Commissioner of Taxation [2002] FCAFC 433 ; (2002) 126 FCR 119 , at 140 [80]. In a related way it was argued that the creditor companies did not incur the losses in gaining or producing income because there was never a realistic prospect of receiving more than a negligible amount of the interest accruing from time to time. Any payment of interest would have affected detrimentally the ability of the debtor companies to make repayments of capital. A further alternative argument advanced on behalf of the Commissioner was that, if the creditor companies did suffer losses to the extent of the bad debts written off, those losses were of a capital nature and not allowable under s 8-2 of the 1997 Act . The losses were unrelated to the income-producing activities of any of FGL, EFGT, Amayana or EFGA because each advance was made after the relevant borrowing entity had become insolvent. The loans were made to ensure the survival of companies in the Finance Group and ensure the orderly realisation of the assets of those companies, thereby preventing the failure of the Foster's Group as a whole. There was never any prospect that the debtor companies would pay interest or dividends. Reference was made to North Australia Pastoral Co Ltd v Federal Commissioner of Taxation [1946] HCA 17 ; (1944) 71 CLR 623 , at 635 and Odhams Press v Cook [1940] 3 All ER 15 , and a comparison was invited with Federal Commissioner of Taxation v Total Holdings (Aust) Pty Ltd [1979] FCA 30 ; (1979) 24 ALR 401. EFGT had itself borrowed that money and incurred interest expenses in doing so. Except in 1996 and 1997, its business of lending money to EFGA and, through it, to other members of the Finance Group had been profitable. The fact that borrower companies found themselves in financial difficulties between 1990 and 1998 does not detract from the conclusion that the continuing provision of debt finance to those companies to enable them to trade out of their difficulties was in the ordinary course of a business of lending money. It is true that decisions could have been made earlier than they were to write-off the bad debts in question or to cease to charge interest to the borrowing companies. However, those were matters calling for the exercise of commercial judgment. In the present case that judgment was coloured by a view of the time needed to recover the debts and the extent to which they were recoverable, which proved unduly optimistic. However, the fact with hindsight the decisions which were made can be regarded as ill-advised, cannot affect the deductibility of the debts under s 25-35(1)(b) of the 1997 Act. I do not regard the necessity for several companies within the Foster's Group to have written off bad debts owed by other companies within the Group as having the "magnifying" effect for which the Commissioner contended. Each debt had actually been incurred and each of the relevant debtors had made substantial repayments of principal and payments of interest in respect of its indebtedness. It was therefore available to be written off by the entity in the Foster's Group to which it was owed. The conclusion which I have reached in relation to EFGT's bad debt deductions makes it unnecessary to consider, in respect of that taxpayer, the Commissioner's further contentions about the application to that taxpayer of s 25-35(1)(a) or s 8-1 of the 1997 Act . The bad debts written off totalled $634,220,249 of which the interest component had been included in FGL's assessable income in each year in which interest had accrued. The accounts of the consolidated Foster's Group of which FGL was the listed parent company reveal that FGL and the consolidated Foster's Group made substantial operating profits in each year from 1989 to 1998 except for 1992 when FGL had an operating loss of $949,439,000 and the consolidated Foster's Group had an operating loss of $949,385,000. FGL's operating revenues over the same period included in each year a significant component of interest which was returned in FGL's assessable income. Initially, intra-group loans were made by FGL at interest directly and indirectly to EFGA. The indirect loans were made by way of advances to AML Finance which were then on-lent to EFGA. After the erection of the security structure noted at [41] above, AML Finance's loans to EFGA were replaced by loans from FGL to EFGT and thence to EFGA. Those loans continued to accrue interest which, from that time, was at the 90 day BBR plus 1.5%. EFGT made substantial payments of interest and repayments of principal to FGL between 1992 and 1998. It also made further such payments in excess of $61 million between 1999 and 2001. The Commissioner impliedly accepted that FGL had never carried on a business of lending money and otherwise relied on the contentions which I have already summarised as denying the deductibility under either s 25-35(1)(a) or s 8-1 of the 1997 Act of the bad debts written off by FGL. In respect of FGL's claim for the bad debt deductions, Counsel for the taxpayers advanced submissions essentially similar to those addressed to the corresponding claim for a deduction by EFGA. The interest arose daily on the outstanding amounts owed to EFGT by EFGA. It follows that the writing off of bad debts in respect of interest was a loss or outgoing of a revenue nature. It cannot be suggested that FGL was engaged in a business of lending money. Its business, the evidence indicates, was that of a holding company. It is apparently not disputed that it included as part of the assessable income derived from that business in previous years the interest charged to EFGT. The evident policy which I discern as underlying s 25-35(1)(a) is that a taxpayer who returns as income in one year an amount earned or derived but not received, is entitled to deduct from the assessable income for a later year that amount if it is not received but is written-off in the later year. I accept that the mistaken inclusion of an amount as income in an earlier year cannot support a deduction of the amount so included in a later year. Under the law as presently interpreted it would seem that the taxpayer could not. No deduction is available under s 63 if, at the time of write-off, there is actually no debt owed as might be said to be the case in the event that the taxpayer's claim to the invoiced amount was unsuccessful: GE Crane Sales Pty Ltd v Commissioner of Taxation (Cth) [1971] HCA 75 ; (1971) 126 CLR 177 , Point v Commissioner of Taxation (Cth) [1970] HCA 7 ; (1970) 119 CLR 453 , Franklin's Selfserve Pty Ltd v Commissioner of Taxation (Cth) [1970] HCA 33 ; (1970) 125 CLR 52. There might, for the same reason, be no ability of a taxpayer to obtain a deduction under s 51(1) of the Act, because the taxpayer would have incurred no loss if it should turn out that the taxpayer was never owed the amount claimed. While both ss 63 and 51(1) have been repealed and replaced in the Income Tax Assessment Act 1997 (Cth) by ss 25 - 35 and 8-1 respectively, the problem averted to has not been the subject of legislative intervention. I am unable to perceive any basis on which the capital amount or principal of any advance by FGL to EFGT could have been correctly included in FGL's assessable income for a previous year. A similar process of reasoning would lead to the loss of principal written off being characterised as "a loss or outgoing of capital or of a capital nature" and so excluded by s 8-2(1) of the 1997 Act from deductibility under s 8-1(b) of that Act. In this context, Counsel for Amayana invoked essentially the same contentions as had been advanced on behalf of FGL. The Commissioner relied, in relation to Amayana, on essentially the same contentions as he had advanced against the deductibility of the bad debts written off by EFGA, EFGT and FGL. As with FGL, the Commissioner did not have to meet an argument that the bad debts written off by Amayana had been in respect of money which it had lent in the ordinary course of a business of lending money. However, the Commissioner also raised an additional argument based on the application to the whole of the debt for principal and interest due to Amayana from EFGT which was written off. According to the Commissioner, neither amount should have been recognised as a receivable in Amayana's accounts and so there was no debt in respect of unpaid interest which could have been written off as bad by Amayana. Alternatively, the Commissioner contended that Div 245 of Sch C of the 1936 Act applied to the whole debt constituted by unpaid principal and interest written off by Amayana. In the result, the loss suffered by EFGA would be reduced by $200,241,963 and that suffered by EFGT by $83,384,542. A "debt" is defined by s 245-15 of Sch 2C as "an enforceable obligation imposed by law on a person to pay an amount. " Division 245 characterises a debt as a "commercial debt" if interest payable on it is, or would be, allowed as a deduction to the debtor. If, contrary to the Commissioner's primary contention, it be held that the unpaid interest owed by EFGA to Amayana is deductible, then the debt becomes a "commercial debt" as defined in s 245-25. That commercial debt, the Commissioner contended, was forgiven in the sense that, when it was written-off, it was "released, waived or otherwise extinguished" within the meaning of s 245-35. The Commissioner calculated the "gross forgiven amount" of the debt due from EFGA to Amayana in accordance with s 245-55 as $325,088,518 and because none of the amounts specified in s 245-85(1) was available to reduce the amount of EFGA's debt the net forgiven amount of that debt was said to be $323,678,521. For essentially the same reasons as I have explained in relation to the corresponding claim by FGL, I consider that the deduction, as so confined, should have been allowed. I am satisfied that there were actual debts due from EFGA to Amayana in respect of which substantial repayments of principal and payments of interest were made between 1991 and 1998 and it was therefore appropriate to record unpaid interest as a receivable in Amayana's accounts. Moreover, for the reasons explained at [216] below, no part of the debt due from EFGA to Amayana, although it was a commercial debt, was forgiven in the sense described in s 245-25 of Schedule C to the 1936 Act. That incapacity, it was said, was self-evident and compelled the conclusion that the earning of interest from the debtor companies was not a genuine concern of those in the Foster's Group involved in managing the affairs of the taxpayer companies. The focus was, rather, on the external assets and the ability of the whole Foster's Group to survive. These inferences were said to be reinforced by a request made of FGL in 1991 for $400 million in interest-free funding for EFGA which, it was recognised, would have "no impact on the liquidity of the Group .... [as] .... all of the entries associated with it would have been eliminated on consolidation. " Accordingly, there was no purpose of earning interest on the loans to internal entities. Alternatively, because everything done after March 1990 in relation to those loans was done with a view to preserving the viability of the Foster's Group as a whole, liability for interest incurred at various points in the internal chain should be treated as of capital account. The Commissioner accepted that s 51(1) of the 1936 Act (applicable to the income years ended 30 June 1995, 1996 and 1997) and s 8-1 of the 1997 Act (applicable to the income year ended 30 June 1998) were not materially different in operation or effect. It was pointed out that each of FGL, EFGT, Amayana and EFGA had returned the unpaid interest as assessable income in each income year in question and had claimed as deductions the interest costs incurred in advancing the sums. The result in each case was said to be "tax neutral" until each taxpayer company wrote off as bad debts the amounts of unpaid interest and claimed tax deductions in respect of the amounts so written off. ELFIC and EFGS each claimed as deductions the interest expenses which they had incurred on loans from internal creditor companies but, as the Commissioner pointed out, those interest expenses were disproportionately greater than the income which each of ELFIC and EFGS derived from external customers, particularly from 1990 when ELFIC and EFGS were in "wind down mode" with no prospect of meeting their liabilities for interest. Even in a case where some assessable income is derived as a result of the outgoing, the disproportion between the detriment of the outgoing and the benefit of the income may give rise to a need to resolve the problem of characterization of the outgoing for the purposes of the sub-section by a weighing of the various aspects of the whole set of circumstances, including direct and indirect objects and advantages which the taxpayer sought in making the outgoing [See, eg, Robert G Nall Ltd v Federal Commissioner of Taxation [1936] HCA 79 ; (1937), 57 CLR 695 , at pp 699-700, 706, 708-709, 712-713]. Where that is so, it is a "commonsense" or "practical" weighing of all the factors which must provide the ultimate answer [[See, eg, BP Australia Ltd v Federal Commissioner of Taxation (1965), 112 CLR 386 , at pp 396-397; [1966] AC 224 , at p 264; Hallstroms Pty Ltd v Federal Commissioner of Taxation [1946] HCA 34 ; (1946), 72 CLR 634 , at p 648; Federal Commissioner of Taxation v Foxwood (Tolga) Pty Ltd [1981] HCA 24 ; (1981), 147 CLR 278 , at pp 285, 293]. If, upon consideration of all those factors, it appears that, notwithstanding the disproportion between outgoing and income, the whole outgoing is properly to be characterized as genuinely and not colourably incurred in gaining or producing assessable income, the entire outgoing will fall within the first limb of s 51(1) unless it is either somehow excluded by the exception of "outgoings of capital, or of a capital, private or domestic nature" or "incurred in relation to the gaining or production of exempt income". If, however, that consideration reveals that the disproportion between outgoing and relevant assessable income is essentially to be explained by reference to the independent pursuit of some other objective and that part only of the outgoing can be characterized by reference to the actual or expected production of assessable income, apportionment of the outgoing between the pursuit of assessable income and the pursuit of that other objective will be necessary. All of the relevant arrangements were between companies with the same beneficial ownership. Many of the companies involved, including Spassked, had no external role at all. The arrangements involving those companies were inherently variable at the will of the ultimate board of directors. They do not reflect the exercise of business judgment in the relevant sense. Thus, the requisite connection or relationship between the outgoing and the earning of assessable income is not to be inferred but must be positively established. " The real purpose of each entity in incurring the relevant interest expense was in preserving the overall financial viability of the Foster's Group as a whole and was focused on its overall assets and liabilities insofar as they might affect the actions of external creditors in relation to FGL as an unsecured creditor of companies within the Finance Group. There was no real concern with income earning activities of "the individual entities involved in the funding structure. " It was said in the same context that the charging of interest ultimately for the benefit of FGL allowed it to take full advantage of the dividend rebate on dividends flowing to it from within the Finance Group; cp Spassked Pty Ltd v Federal Commissioner of Taxation (No 5) [2003] FCA 84 ; (2003) 197 ALR 553 , at 561-2 [31], [32]. Another feature of the altered funding arrangements between 1990 and 1991 was that FGL effectively became the financier of the Finance Group and passed the cost of assuming this role, by charging interest on its loans, first to EFGA and later to EFGT which relayed the interest costs to EFGA. The Commissioner acknowledged that this arrangement "notionally balanced out" the additional cost to FGL of funding the Finance Group; cp, Macquarie Finance Ltd v Commissioner of Taxation [2005] FCAFC 205 ; (2005) 146 FCR 77 where it was held by French J, who was in the majority in the result, that interest payable by a subsidiary (MFL) to holders of notes stapled to preference shares in the parent company (MBL) was not deductible under s 8-1(1) because MBL had a capacity to redirect interest payments to MBL so that they would be received as dividends on the preference shares instead of interest on the notes. French J was persuaded to come to that conclusion because MFL's liability to pay interest on the notes was not tied to any income-producing purposes of its own but was incurred to procure a permanent capital increase for MBL's corporate group to satisfy capital adequacy requirements imposed by the Australian Prudential Regulation Authority. In the present case, the Commissioner contended that, because there was no real prospect that EFGA or EFGT would ever pay interest on the loans, the arrangement just described involving the capitalisation and compounding of interest owed to FGL was "highly artificial" and a "device" to protect FGL's ability to pay dividends. In a related way, the Commissioner contended that, to justify the claiming of deductions for interest on borrowings, each of FGL, EFGT, EFGA, Amayana, ELFIC and EFGS had to demonstrate a nexus between those borrowings and the derivation of assessable income. No such nexus could be demonstrated because the presumptive income was "illusory" in the sense that the parties knew that it would never be received by EFGA, EFGT, Amayana and FGL. As ELFIC and EFGS has no prospect of deriving income from the funds on which they were charged interest, the charges only served to create and, presumably, increase losses by those companies. In support of his contentions in this context, the Commissioner pointed to differences of opinion within FGL about whether it should continue to charge interest on loans to subsidiaries. The decision to do so was said to reflect a concern to preserve the ability to pay dividends to FGL shareholders and retain the full advantage of the dividend rebate. Although he accepted that deductibility of interest expenses incurred by a taxpayer has to be assessed in the light of the circumstances obtaining in each tax year, the Commissioner contended that, in this case, there was no relevant change in any year from 1990 to 1998 because the endemic incapacity of the borrower companies prevailed and became worse throughout that time. That consideration reinforced the conclusion that EFGA had incurred its interest expenses to pursue advantages other than the production of income. The Commissioner sought to distinguish the present case from Federal Commissioner of Taxation v R & D Holdings Pty Ltd [2007] FCAFC 107 ; (2007) 160 FCR 248. In that case, a corporate property developer had borrowed money to finance the construction of flats. The lender/mortgagee went into possession after the borrower defaulted and eventually sold the property after ten years. In the meantime, the mortgagee collected rent from the flats and paid the outgoings. Interest was capitalised from time to time with the result that, by the time of the sale, the borrower owed more than $100 million by way of capital and unpaid interest. The developer's claim of deductions for the interest was upheld at first instance and on appeal in this Court. The point of distinction between R & D Holdings on the present case, according to the Commissioner, is that, in that case, the arrangements between the taxpayer/developer and the mortgagee were at arm's length. The present case is more analogous to Ure v Commissioner of Taxation [1981] FCA 9 ; (1981) 50 FLR 219 where the claim to deduct interest was apportioned having regard to its having been incurred for deductible and non-deductible purposes. In this case, the Commissioner contended, regard should be had to "what the expenditure was calculated to effect from a practical and business point of view"; see Federal Commissioner of Taxation v Firth (2002) 120 FCR 450. Here, the purpose of each expenditure on interest was to benefit FGL and the Foster's Group as a whole; see Hooker Rex Pty Limited v Commissioner of Taxation (1988) 79 ALR 181. The basis of this submission was that the interest had been incurred in gaining or producing ELFIC's assessable income or had been necessarily incurred by ELFIC in carrying on a business of gaining or producing ELFIC's assessable income and was not a loss or outgoing of capital or of a capital nature. It was not suggested on behalf of the Commissioner that those interest expenses were a sham. The fact that the interest expenses were significantly greater than the income derived by the taxpayer in each of the years in question does not entail that the expenses were not incurred in carrying on an income producing business. The disproportion is a reflection, rather, of the financial difficulties experienced by ELFIC's external customers in the late 1980's which resulted in diminished returns to ELFIC on the circulating capital deployed in its business. The business being conducted by ELFIC from 1990 onwards was the same business as had been carried on successfully since 1984. The fact that after 1990 ELFIC was in "wind down" mode did not alter the essential nature of that business. This is not a case like that identified in the passage from Fletchers's case quoted at [165] above where the disproportion between the expenditure on interest and the income derived is to be explained by reference to the independent pursuit of some objective other than the carrying on of ELFIC's core business. It does not follow that, because the core business was being wound down, the interest expenditure incurred in continuing the business was not wholly expended in carrying on the business. The fact that UAS was winding down its borrowing activities did not mean that the servicing of such borrowings as remained, including making arrangements for the payment to debenture holders, were not part of its ordinary business. It was not an "unusual" transaction in the sense used by Mason J in International Nickel. Rather, although UAS had resolved not to expand its business but run it down, its business was still continuing. That business included the receipt of interest on funds lent out by it and the payment of interest on moneys borrowed by it. It continued at the least until the moneys borrowed had been repaid and indeed perhaps thereafter, or at least while moneys were owing to it, by Unilever related companies. The activities undertaken by CDGC in the present case, such as the assignment of mining leases and novation of rights under port user agreements and other contracts as well as the preparation of tax returns and the claiming of concessions for research and development, are more explicable, as a matter of fact, as having been engaged in as a consequence of the sale of the business rather than of its being "wound down". Part of the loans from EFGT had been used to repay loan funds previously advanced to EFGA by FGL and AML Finance. Those earlier loans and the later advances from Amayana had been used by EFGA to make loans at interest to the Finance Group subsidiaries. The interest charged to the subsidiaries had been returned as part of EFGA's assessable income. The activities of EFGA were conducted with a view to making a profit by fixing interest rates charged to the borrowing entities by reference to the BBR plus a margin. The rates were competitive with those which the borrowing entities could have obtained on the open market from external lenders. EFGA also sought to maximise the return on the funds under its control by lending surplus moneys to third parties usually on the short-term money market. Each of the operating groups within EFGA was expected to, and usually did, make a profit after allocation to it of an appropriate part of EFGA's overhead expenses. During the process of orderly realisation of the Finance Group assets, noted at [44] above, EFGA continued to lend at interest to other members of the Finance group including ELFIC and EFGS. From 1 September 1990 EFGA charged the borrowing entities interest at only the same rate at which EFGA was charged by internal lenders including FGL, EFGT and Amayana. After the institution in 1991 of the security structure noted at [41] above, previously unsecured loans made to EFGA were repaid and replaced with secured interest-bearing loans channelled through EFGT. The operating losses were generally attributable to provisions raised to record diminution in the value of investments and loans, losses on the disposal of investments and, later, the writing off of bad debts. In every year from 1986 to 1998 except 1987, EFGA's reported income in the form of interest exceeded its expenses by way of interest on borrowed funds. That interest was included in EFGA's assessable income for each relevant year. The contention was essentially similar to that advanced on behalf of ELFIC which is outlined at [175] above. The expenditure was calculated to effect from a practical and business point of view the continuing provision of funds at interest to the Finance Group subsidiaries to enable them to maintain their businesses as going concerns until they could be disposed of or closed down as part of the wind-up operation. That provision of funds was the central function which EFGA had assumed in the conduct of its business. Aspects of Amayana's activities relevant to its claim for a deduction in respect of interest. In the assessment issued to Amayana for the 1998 tax year, the Commissioner disallowed a deduction of $16,875,354 which had been claimed in respect of interest paid to FBGT on loans which had been on-lent at interest to EFGA. The interest on the loans to EFGA had been returned as part of Amayana's assessable income in the years in which it had accrued. In most years between 1991 and 1999 Amayana's costs of borrowing from FBGT matched its reported income in the form of interest from EFGA so that it recorded neither an operating profit nor an operating loss. During the same period, Amayana made payments of interest and repayments of principal to FBGT which totalled $124,338,706. The interest which Amayana had been required to pay was for the periodic use of funds which it had deployed as circulating capital in its business and was therefore on revenue account. He also contended, specifically in relation to Amayana, that part of EFGA's debt to Amayana had been forgiven as contemplated by s 245-15 of Schedule 2C of the 1936 Act. The funds which Amayana had borrowed had been used to derive assessable income in the form of interest from EFGA. The interest which Amayana had been required to pay represented the recurrent or periodic cost to it of securing those funds. I regard the activities of Amayana in the context of the Foster's Group as materially different from those of the group examined by Gyles J in Spassked (supra). There was, I consider, a frequent and often nice exercise of business judgment in conducting the affairs of Amayana and those of the related-party borrowers from it. Moreover, by contrast with Macquarie Finance (supra) , Amayana's liability to pay interest to FGL was tied to Amayana's own income-producing purposes. I do not regard Amayana's prospect of receiving that income in the form of interest as "illusory" at the time when the interest was charged. For the reasons explained at [202] below the debt due from EFGA was not forgiven as contemplated by s 245-35(12) of Schedule 2C of the 1936 Act. It follows that there was no impact by that provision on Amayana's ability to claim a deduction for interest on the funds which it had borrowed to lend to EFGA. It began to borrow directly from EFGA after 1986 although it continued to borrow relatively small amounts from ELFIC. It was charged interest by EFGA on its borrowings from that company at EFGA's normal inter-company rate fixed by reference to the BBR plus a margin. From mid 1989, the Foster's Group began to realise certain EFGS assets as part of the process of realising assets of the Finance Group. EFGS continued to carry on business during the period to June 1998, including the management of its interest in the "Akron" joint venture into which assets of the Finance Group in the bloodstock industry had been transferred. The loans were properly recorded and were not suggested by the Commissioner to have been shams. The borrowed funds had been used by EFGS in the same business activities in which it had continuously been engaged since before 1987. The money borrowed from EFGA was used in the course of the business of EFGS which included the derivation of income and during the wind-up the realisation of loans to external customers and other interest-bearing assets. These considerations are reinforced by the accession of EFGS during the wind-up to the management of the Finance Group's interest in the "Akron" bloodstock joint venture. EFGT was part of the security structure that was set up between February and October 1991 as described at [41] above. Loan funds were channelled from FGL through EFGT to EFGA. As already indicated, the purpose of the new arrangement was to provide secured loans in place of previously unsecured loans so as to give FGL, as the ultimate lender, priority over the claims of unsecured creditors, particularly those which, at the time, were pursuing litigation against companies in the Finance Group. After its insertion into the structure, EFGT used the funds to make loans at interest to companies within the Foster's Group, particularly EFGA. EFGA in turn used the funds which it had borrowed from EFGT to repay loans to FGL and AML Finance. EFGT was required to pay interest to FGL at the 90 day BBR plus 1.5%. Interest continued to be charged in that way until the end of the 1998 financial year. As well, from 1992 to 1998 EFGT received money on deposit from other members of the Finance Group and was obliged to pay interest thereon to the depositors. Over the same period from 1992 to 1998 EFGT's business produced substantial assessable income, almost all of it by way of interest charged on loans which it made. It progressively made payments and repayments in respect of the debts which it owed to FGL. It was submitted that EFGT was entitled to a deduction for interest which had incurred on loans from FGL under the security notes and the security management agreement. Counsel pointed to the fact already noted that EFGT had derived substantial income in the form of interest on the loans advanced by it to EFGA. The interest which EFGT had been required to pay was for the periodic use of the borrowed funds as part of its circulating capital and was therefore on revenue account; see Australian National Hotels Ltd v Federal Commissioner of Taxation (1988) 19 FCR 234 , at 240. The money which EFGT had borrowed from FGL was genuinely advanced to borrowers and deposit and interest was genuinely charged on it. Except for the interposition of the security structure, those transactions essentially continued the same income-producing activity which had been carried on since 1986. I do not regard the creation of the security structure or the purpose for which it occurred as having any relevant bearing on the entitlement of EFGT to claim a deduction for interest expenses actually incurred. Was the interest expenditure on capital account? An alternative contention of the Commissioner proceeded from the premise that the essential character of the liability was to be determined by objectively identifying the nature of the advantage sought in incurring it. Although it was accepted that interest, as a periodically recurring liability securing the use of money during the term of the loan, is ordinarily a revenue item, the purpose of the interest payment may, in particular circumstances, be something other than raising or maintaining the borrowing. In those circumstances, the purpose of the borrowing might lead to its characterisation as being of a capital nature; see Steele v Deputy Commissioner of Taxation [1999] HCA 7 ; (1999) 197 CLR 459 , at 470. In the present case, the interest claimed to be deductible accrued after the Finance Group had ceased to be a going concern and after there was no longer any prospect of repaying the borrowed funds. The advantages gained were the protection of FGL's position as an unsecured creditor of the Finance Group, the preservation of the full rebate on dividends flowing to FGL and the "balancing out" of additional costs incurred by FGL in funding the Finance Group. The debt funding was directed to ensuring the survival of companies in the Finance Group and, so, to establishing and maintaining the capital structure of the Foster's Group as a whole. It was therefore on capital account. As already indicated in relation to EFGS, I do not consider the fact that income-producing activities undertaken in the course of a business may have other purposes or effects militates against the entitlement of a taxpayer conducting those activities to deduct from the assessable income thereby produced an expense of a revenue nature incurred in deriving that income. Even if the corpus of the loan funds deployed by a lender is properly to be regarded as a capital asset in the hands of the lender, the interest paid to secure that capital sum or keep it in circulation is on revenue account. If the capital is raised by loan, an investment of the borrowed moneys in a business will ordinarily remain an investment of capital, and the same consequences will follow. But there is a special feature of loan capital, which flows from the ephemeral nature of a loan. The cost of securing and retaining the use of the capital sum for the business, that is to say, the interest payable in respect of the loan, will be a revenue item. It creates no enduring advantage, but on the contrary is a periodic outgoing related to the continuance of the use by the business of the borrowed capital during the term of the loan. If allowed, that claimed deduction would have reduced to nil Ashwick's taxable income for the 1997 year. In the 1998 year of income FGL transferred to Ashwick a loss of $23,628 claimed to have been incurred by FGL in that year. That loss was part of a tax loss of $119,899,125 claimed to have been incurred in 1998 which was arrived at after deducting bad debts in respect of interest amounting to $408,058,393 which had been written off by FGL; see [149]-[155] above. If allowed, the claimed deduction of $23,628 would have reduced to nil Ashwick's taxable income for the 1998 tax year. Later, in 2001, Ashwick claimed to deduct from its assessable income for that year a loss of $70 claimed to have been incurred by EFGA in 1998 which was transferred to Ashwick. That loss was part of a tax loss of $1,299,477,144 claimed to have been incurred by EFGA which included EFGA's claims for deductions for bad debts written-off by EFGA in respect of interest and principal owed to EFGA by ELFIC and EFGS; see [83], [85] and [86] above. The same loss also included the deductions claimed by EFGA for interest incurred on loans to EFGA from EFGT and Amayana; see [185] above. That loss by EFGT was part of a tax loss of $525,437,631 which included EFGT's claim for a deduction for writing off as a bad debt the interest owed to EFGT by EFGA; see [145]-[147] above. It also included a claim for interest incurred on loans to EFGT from FBGT; see [198] above. The total claimed deductions of $145 if allowed, would have reduced to nil Ashwick's taxable income for the 1998 tax year. Ashwick's claim for a deduction in the 1997 tax year has to be evaluated in the light of s 79E and s 80G of the 1936 Act . Note 2: To find out how much of a loss incurred in a post 1989 year of income you can deduct for the 1997 98 year of income or a later year of income: see section 36 105 of the Income Tax (Transitional Provisions) Act 1997 . Note 3: For the rules about deducting tax losses from assessable foreign income for the 1997 98 year of income or a later year of income: see section 79DA. Substantially the same five requirements were said to be imposed by Division 170 of the 1997 Act in respect of deductions claimed in the 1998 and 2001 years of income. It was further submitted on behalf of Ashwick that each of the five requirements identified above had been satisfied in respect of the losses incurred by ELFIC, FGL, EFGA and EFGT and variously transferred to Ashwick in the 1997, 1998 and 2001 years of income. According to Counsel for Ashwick, the Commissioner disputed the deductibility of the tax losses transferred to Ashwick only on the ground that the debts said to have given rise to the losses were affected by the Commercial Debt Forgiveness rules in Division 245 of Schedule 2C of the 1936 Act . None of those modes of forgiveness, it was said, was applicable to the debts owed by EFGA to Amayana. They remained in existence as evidenced by a deed poll executed by Amayana on 31 July 1998 which recited: Amayana ("the Creditor") is a creditor of EFG Australia Pty Ltd ("the Debtor") in respect of balances outstanding on advances and accruals of interest less repayments from time to time ("the Debt"). The mere fact that the debts were written off did not signify that they had been released waived or otherwise forgiven. Moreover, it was said, the scheme of the 1997 Act contemplates that debts continue to exist after they have been written off. Regular acknowledgements had been made to Amayana on behalf of EFGA and part payments in reduction of the debt had been made throughout the currency of the loan including up to the end of the year ended 30 June 1999. Finally it was said that there was no agreement or arrangement between Amayana and EFGA for the latter's obligation to pay the whole or part of the debts to cease at a particular future time. By way of proving this negative, reference was made to the resolution of Amayana's directors on 31 July 1998 to write-off as bad some of the debts owed by EFGA and to reduce to nil the rate of interest on the debts owing while reserving the right to increase the rate of interest in the future. Reliance for this purpose was also placed on Amayana's execution of the deed poll noted at [212] above. They were acknowledged in the accounts of EFGA in a manner held to be sufficient in Stage Club Ltd v Millers Hotel Pty Ltd [1981] HCA 71 ; (1981) 150 CLR 535 , at 566. Nor is there any discernible basis on which those debts could be said to be statute-barred or to have been the subject of an agreement whereby EFGA's obligation to pay them in whole or in part was to cease at a particular future time. It therefore follows that the debts, when written off, were available as a tax loss to Amayana which was transferable to Ashwick. Included in the calculation of that loss was Amayana's claim to deduct as bad debts written-off the interest owed to Amayana by EFGA. In the 2000 year of income Nexday Pty Ltd ("Nexday"), a subsidiary, the shares in which were owned by FGL either directly or through one or more interposed entities, had taxable income of $139,290. Pursuant to a written loss transfer agreement executed before Nexday lodged its tax return for the 2000 year, Amayana transferred losses of $139,290 to Nexday. Amayana and Nexday were at all relevant times Australian resident companies. For the reasons explained at [216] above in respect of the tax loss claimed by Ashwick, the debts owed by EFGA to Amayana were available when written off to be transferred to Nexday. Included in the calculation of that loss was a deduction for interest incurred on loans to EFGS from EFGA. In the 1996 year of income EFG Investments Pty Ltd ("EFG Investments"), a subsidiary the shares in which were wholly owned by FGL either directly or through one or more interposed entities, had taxable income of $1,391,715. Pursuant to a written loss transfer agreement executed before EFG Investments lodged its tax return for the 1996 tax year, EFGS transferred to EFG Investments losses of $739,340. EFGS and EFG Investments were at all relevant times Australian resident companies. For essentially the same reasons advanced on behalf of Ashwick, it was contended that EFG Investments was entitled to a deduction under s 79E and s 80G of the 1936 Act for the loss transferred to it by EFGS. That claim was based on a loss constituted by a liability for interest and was apparently disputed by the Commissioner solely on the ground that the interest claimed was not allowable as a deduction to EFGS. As I have indicated at [194] above that the claim of EFGS to that deduction should be upheld, it follows that the transferred tax loss was deductible in the hands of EFG Investments. " Those steps have been described inclusively, rather than exhaustively, at [183] of the Commissioner's Appeal Statement. In relation to EFGA, ELFIC and EFGS, the steps were identified as including EFGA's borrowing funds at interest from FGL, Amayana and EFGT, on-lending those funds at interest to ELFIC and EFGS, returning the interest so charged as assessable income and allocating repayments by ELFIC and EFGS to principal and not interest. Another step was identified as the writing-off in 1998 by EFGA as bad debts the moneys due from ELFIC and EFGS under the loans to those companies. A step said to have been taken by ELFIC and EFGS was the claiming by each of those companies as a deduction from its assessable income of the interest charged to it by EFGA. The participation of the Foster's Group as a whole in the scheme postulated by the Commissioner was said to involve the transfer of losses from EFGA, ELFIC and EFGS to Ashwick and EFG Investments. More specifically, FGL was said to have participated in the scheme by lending money at interest to EFGT for the making of loans to EFGA, returning the interest so charged as assessable income, allocating repayments by EFGT to principal, not interest, writing-off in 1998 as bad debts the amounts unpaid under the loans to EFGT and the transfer to other entities in the FGL of losses incurred by FGL. Similarly, EFGT's participation in the scheme was said to consist in its borrowing money at interest from FGL, making loans at interest to EFGA, returning the interest so charged as assessable income, claiming the interest charged by FGL as a deduction, allocating repayments by EFGA to principal, not interest, writing-off in 1998 as a bad debt the moneys due from EFGA under the loans to it and transferring EFGT's losses to other entities in the FGL, including Ashwick. Amayana's participation in the scheme identified by the Commissioner was said to be its borrowing funds at interest from FBGTA, on-lending them at interest to EFGA, returning the interest so charged as assessable income, claiming a deduction for interest charged to it by FBGTA, allocating repayments by EFGA to principal, instead of interest, writing off as bad debts in 1999 the amounts unpaid by EFGA and transferring its (Amayana's) losses to other entities in the FGL including Nexday. Ashwick's, Nexday's and EFG Investments' participation in the scheme was said to be their claiming of deductions in relation to the losses respectively transferred to them. The Commissioner acknowledged that the application of Part IVA "requires more than a possibility. It involves a prediction as to events which would have taken place if the relevant scheme had not been entered into or carried out and the prediction must be sufficiently reliable for it to be regarded as reasonable"; Peabody v Federal Commissioner of Taxation [1994] HCA 43 ; (1994) 181 CLR 359 , at 385. However, the internal provision of loan funds to ELFIC and EFGS from 1989 was not part of a coherent course of conduct but occurred as individual responses from time to time to external exigencies created by circumstances of the external financial climate. The fact that intra-group loans were made at interest does not signify the existence of a scheme. Intra-group loans had commenced before 1989. Moreover, the loans from external sources which they replaced had also been at interest and the charging of interest has been adequately explained by the need to preserve an index by which the performance or profitability of borrowers within the Finance Group could be measured. In the Commissioner's submission, if the scheme which he identified had not been entered into, interest would not have been charged to debtor companies within the Foster's Group after, at the latest, 1 July 1990. In that event, the debtor companies would not have been able to claim the interest as deductions and the creditor companies would not have been able to write off as bad debts moneys due to them as interest. In addition, EFGA derived a further tax benefit from the allocation of repayments made by it first to principal and secondly to interest, thereby increasing the component of the loan account balance attributable to interest. The Commissioner further contended that, if FGL had not entered into the scheme, interest after 1990 would not have been charged within the Finance Group but the loans to those companies would have been treated as interest-free. Secondly, by allocating repayments on a first-in, first-out basis in accordance with the rule in Clayton's case, instead of applying them first to the liability for interest, FGL increased the amount of interest which was ultimately written off as bad debts in 1998. The resultant tax losses were transferred to the benefit of "income companies" in the Foster's Group. Making the prediction on the hypothesis enjoined by the High Court in Federal Commissioner of Taxation v Peabody [1994] HCA 43 ; (1993) 181 CLR 359 , I am not persuaded that, if the scheme postulated by the Commissioner had not been entered into, the deductions referred to in the last preceding paragraph would not have been allowable or might reasonably be expected not to have been allowable. I have already indicated, at [228] above, a basis on which interest could reasonably have been charged to borrowers in the Foster's Group even in the absence of the presumptive scheme. On that basis, the facility of lenders within the Group to write off as bad debts amounts of unpaid interest would still have existed and have provided the foundation for deductions being allowed to those lenders in the year or years in which the write-offs occurred. There is also considerable force in the contention advanced on behalf of the applicants that, on the hypothesis required by s 177C(1) that the presumptive scheme had not been entered into, the interest income on which the deductibility of the bad debts written-off and the interest incurred on intra-group loans was predicated would not have been derived. On that hypothesis, the tax benefit imputed to the scheme propounded by the Commissioner would not have been achieved. I also agree with the contention advanced on behalf of the applicants that the deductions claimed to have been available as a result of the transfers of tax losses to Ashwick, Nexday and EFG Investments, occurred as a result of the making of agreements expressly provided for by the Act. For the reasons already explained, I am satisfied that the presumptive scheme was not entered into for the purpose of enabling those agreements to be made. The Commissioner, in the course of his submissions, examined each of the eight objective matters enumerated in s 177D(b) of the 1936 Act as requiring to be considered in order to identify the purpose of a scheme. When that is read with s 177D(b) it becomes apparent that the inquiry directed by Pt IVA requires comparison between the scheme in question and an alternative postulate. To draw a conclusion about purpose from the eight matters identified in s 177D(b) will require consideration of what other possibilities existed. To say, as Hill J did, that "the manner in which the scheme was formulated and thus entered into or carried out is certainly explicable only by the taxation consequences" assumes that there were other ways in which the borrowing of moneys for two purposes (one private and the other income producing) might have been effected. And it further assumes that those other ways of borrowing would have had less advantageous taxation consequences. As well, EFGT, from the year ended 30 June 1992, made additional new loans at interest to EFGA using funds borrowed from FGL, also at interest. The actions of FGL in entering into that chain of transactions were said to be informed by FGL's knowledge that EFGA, ELFIC and EFGS lacked the ability to pay interest on their respective borrowings which, in turn, affected Amayana's ability to pay interest on its borrowings from FBGTA. Similarly, EFGA had no capacity to make regular and timely payments of interest on its borrowings from EFGT and Amayana. The capitalisation and compounding from month to month of interest allowed it greatly to exceed the assets of the Finance Group, EFGT and Amayana. It was further said by the Commissioner that, as a result of EFGA having, in October 1991, given security over its assets to EFGT but having given no security to Amayana, Amayana's loan to EFGA became irrecoverable but was not written-off until July 1998. As well, the Commissioner claimed, the inclusion of EFGT and Amayana in the funding structure, "multiplied the bad debt deductions. " Members of the Finance Group, EFGT and Amayana were, in real terms, insolvent from November 1989 and were only enabled to continue to trade as a result of resolutions, letters of comfort and guarantees to external creditors given by FGL. The Commissioner also pointed to the change after 30 June 1994 in the allocation of repayments by internal creditors which were applied on a FIFO basis, first to repayment of older outstanding advances of capital. Another feature of the treatment of debts internal to the Foster's Group to which the Commissioner pointed was the fact that companies within the Group which received transferred losses did not make subvention payments to the transferor companies. Such payments would have reduced the bad debts due from the loss companies and consequently have minimised the "losses" incurred by the creditor companies when they wrote-off as bad the debts owed by the debtor companies. The matters identified by the Commissioner were said to go to the manner in which the scheme was entered into or carried out and to accentuate the predominance of a purpose of obtaining the tax benefits. The creditor companies did not gain the usual advantage of charging interest, namely a return on their loans. The economic advantage accrued solely in the form of tax benefits to the FGL as a whole. I doubt whether any of the matters instanced by the Commissioner under this head goes to the "manner" in which the scheme to which he pointed was entered into or carried out. It has to be borne in mind that the question of dominant purpose will usually be determined at the time when the alleged scheme was entered into; see Vincent v Commissioner of Taxation [2002] FCAFC 291 ; (2002) 124 FCR 350 , at 372. In the present case some of the matters relied on by the Commissioner such as the charging of interest to subsidiaries within the Finance Group predated the time ascribed by the Commissioner to entry into the scheme. In any event, the features identified by the Commissioner as going to "manner" were explicable as actuated by a dominant purpose other than the obtaining of a tax benefit. The fact that intra-group loans to Finance Group subsidiaries were made at interest is at least as readily explicable by a concern to measure or monitor the performance of the borrowing companies. A similar observation can be made about the compounding or capitalising of the interest after timely payments had ceased to be made with any regularity. A corresponding explanation is available in respect of some loans based on the security structure which, as described at [41] above, had been erected in mid-1991 to provide a measure of protection for the Foster's Group assets from external creditors. The delay in writing off bad debts owed by borrowers to lenders within the Foster's Group was, I consider, at least equally explicable by a belief held by the relevant finance officers before 1997 that the debts were not wholly irrecoverable. Support for that belief was available from the fact that repayments were made from time to time after 1992 by even the most heavily indebted subsidiaries as assets were realised. I do not regard the allocation after 1994 of repayments by the borrowing subsidiaries on a "first in first out basis" as part of the manner of carrying out the alleged scheme which indicates the proscribed dominant purpose. Where separately identifiable debts or components of a debt were owed by a particular subsidiary, it was obviously necessary to make an election as to which debt or component was to be reduced or eliminated by a given part payment. The allocation of some of such part payments to reduction or elimination of the oldest advances of principal was logically justifiable otherwise than by reference to a tax benefit in the form of an ability at some time in the future to transfer within the Foster's Group tax losses which could not have been quantified at the time of each part payment. Similar considerations apply to the absence of subvention payments to the transferor loss companies which were parties to the tax loss agreements. The absence of such payments is explicable by the fact that the agreements were entirely "in house" so that any subvention would have had a purely neutral effect on the consolidated finances of the Foster's Group. The relatively small amounts of some of the tax losses involved also militates against the existence of a dominant purpose to obtain a tax benefit in the form of deductions for transferred losses claimable by the transferee companies. These differences between form and substance of the scheme were said to point to a purpose of avoiding tax. I doubt whether there was a relevant difference between the form and substance of the scheme identified by the Commissioner. There is no suggestion that any of the intra-group loans or the accounting entries which evidenced the transactions were shams. It is true that in some significant instances interest on the loans was never paid in full but the substance as well as the form of the loan transactions did not contemplate a failure by some of the borrowers to pay interest in full. Despite EFGA's making dramatically increasing provision between 1991 and 1997 for doubtful debts from intra-group borrowers, it did not write-off the debts as bad until June 1998, preferring, instead, to charge and capitalise interest on the outstanding loans. The Commissioner also focused specifically on 19 June 1998 as the date on which EFGA, EFGT and FGL wrote off as bad debts the loan amounts respectively due to each of those companies. It was said that, by making the write-off take effect at 30 June 1998, "the creditor companies maximised the deductions that would be available, since interest continued to accrue up to 30 June 1998, even after the boards had resolved to write-off the loans. " On the other hand, it was pointed out that Amayana's write-off in July 1998 had been "reasonably contemporaneous" with the actions of EFGA, EFGT and FGL but allowed Amayana to schedule the tax effect of the write-off for the year of income ended 30 June 1999. In the light of the timing of the events outlined above and the period over which interest had been allowed to accrue, the Commissioner argued that it could readily be inferred that the scheme had been entered into primarily to obtain tax benefits. Usually, in this context, the time of entry into a scheme is said to be significant because it coincides with, or is closely proximate to, the end of a tax year in which the presumptive tax benefit is sought to be obtained. In the present case, the scheme alleged by the Commissioner was said to have entered into after November 1989 so that 19 June 1998 cannot assume the significance which the Commissioner has attached to it. I can discern nothing in the events which occurred at about that time which tends to indicate that a purpose of the relevant actors was to obtain a tax benefit. Those events were a natural consequence, in the light of changed financial circumstances, of pre-existing arrangements between the members of the Foster's Group as a whole and of the arrangements to which particular members of the Finance Group were parties. Similarly, the period over which the alleged scheme was carried out does not assist in imputing the requisite purpose to any relevant person. It is clear from the evidence that the period over which various arrangements were maintained between lenders and borrowers within the Foster's Group was dictated by the time needed to realise assets and make repayments of principal and interest. There is nothing to suggest that any presumptive tax benefit was predicated on an event occurring within, or after the lapse of, a particular period of time. Had interest not been charged, and had repayments not been allocated on a first-in first-out basis, write-offs of $64,814,698 in the year ended 30 June 1998 would not have been available. As indicated at [237] above, the result of the scheme in relation to the operation of the Act independently of Part IVA, was one for which the Act itself provided namely that interest returned as income could, if never received, be written off as a bad debt. I regard the application of this criterion as neutral on whether an intention to achieve a tax benefit can objectively be imputed to the relevant actors. In particular, it was contended that, although the unpaid interest had been returned as income by creditor companies, the off-setting of those amounts by claims for deductions of interest on borrowed funds and the writing-off of bad debts "in effect resulted in a duplication of claims for tax deductions within the corporate group for the 1997-1998 period. " It was said that the failure to charge interest on intra-company loans meant that there was no net impact, apart from a beneficial tax impact, on the accounting positions of creditor companies within the Foster's Group. As well, the charging of interest on intra-group loans "washed out on consolidation" and was therefore of no concern to FGL. Correspondingly, the accrued interest expense had no effect on the ability of companies in the Foster's Group to discharge their obligations to external creditors or on the cash position of the Finance Group companies. The effect would have been the same had the scheme not been entered into. The capitalisation and compounding of unpaid interest meant that it exceeded the interest on external borrowings to fund the Finance Group and "augmented the beneficial tax effects" of the tax deductibility of interest expenses and the dividend cash flow to FGL shareholders. There were clearly changes in the respective financial positions of various members of the Foster's Group from time to time between 1989 and 2000. Many of those changes resulted from external forces which were regarded, for reasons unrelated to any tax benefit, as compelling internal adjustments of assets and liabilities and a re-arrangement of security over some assets. Some of those adjustments, although they involved a substitution of internal lenders for outside financiers, did not significantly change the financial position of the relevant borrower. Corresponding changes also resulted in some lending companies within the Foster's Group deriving assessable income in the form of interest on loans which had not been derived before the changes occurred. On balance, I do not regard these changes, or those more specifically indicated by the Commissioner, as strengthening or weakening the inference that the alleged scheme was entered into or carried out for the dominant purpose of obtaining a tax benefit. That "real economic loss" was quantified by the Commissioner at $1,202,000,000 being the losses in the statutory accounts of the FGL for the 1990, 1991 and 1992 tax years less losses recovered between the years ended 30 June 1993 and 30 June 1996. Attention was also drawn to the transfer of tax losses to profitable companies within the FGL reducing the amount of tax which those companies would otherwise have paid. Those tax losses could not have been generated without the financial support and comfort provided by FGL to enable insolvent borrowers within the Group to continue to incur losses. Consequences for companies other than the relevant taxpayers were reflected in tax savings generated by the scheme. The changes identified by the Commissioner under this head were said to be consistent with the dominant purpose of obtaining the tax benefits flowing from the scheme. Because of the elaborate inter-connected group structure of FGL and its subsidiaries action taken in response to changed financial circumstances in respect of one member of the Group necessarily had repercussion for one or more other members of the Group. However, I do not regard any changes in the financial position of one or more Foster's Group companies which were connected in that way to a particular taxpayer member of the Group as having any purposive significance of the kind to which s 177D(b)(vi) points. In my view, all of the changes which can be characterised as relevant to this criterion have been evaluated in the application of the criteria erected by sub-paragraphs (i), (iii) and (v) of s 177D(b). Under that direction, the lending companies had continued to make advances to the borrowers at interest in circumstances in which no independent lender would have done so. The inter-connection between companies in the Foster's Group and the fact that they were subject to the overall direction of FGL has already been noted and evaluated in the application of other criteria postulated in s 177D(b). The making of loans and the giving of guarantees and letters of comfort to borrowers within the group which would have been hopelessly insolvent if considered as independent entities, is readily explicable by the need to preserve the financial viability of the Foster's Group as a whole. In my view, those features of the nature of the connection does not support any inference that the dominant purpose of those who administered the connected activities of the Foster's Group was to obtain a tax benefit. In summary, I have reached that conclusion because, on balance, I have not been persuaded that the steps described by the Commissioner as having been taken by the Foster's Group between 1989 and 1998 constituted a "scheme" within the meaning of Part IVA. In the second place, that "tax benefits" in the requisite sense would have been derived had the presumptive "scheme" not been disallowed under Part IVA. Thirdly, if contrary to my view there were such tax benefits, I have found that the presumptive scheme was not entered into for the dominant purpose, objectively ascertained, of obtaining those benefits. The earlier proceedings has thus been overtaken and it is unnecessary to make any substantive order in it. These proceedings numbered VID 861 of 2006 will accordingly be dismissed with no order as to costs. In light of the conclusion indicated at [216] of these reasons there should be an order in each proceeding that the appeal against the objection decision be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with the reasons of the Court published this day. The Commissioner must pay Ashwick's costs of each proceeding. Apart from his invocation of Part IVA, the Commissioner relied on a contention that because of deductions claimed by Amayana and properly disallowed there was no transferable tax loss. As indicated at [218]-[219] of these reasons the Commissioner's contention has not been upheld. Accordingly, there should be an order in this proceeding that the appeal against the objection decision be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with the reasons of the Court published this day. The Commissioner must pay Nexday's costs of the proceeding. As indicated at [222] of these reasons, for the reasons explained at [194] above, the claim by EFGS to deduct interest has been upheld. There should therefore be an order in this proceeding that the appeal against the objection decision be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with the reasons of the Court published this day. The Commissioner must pay EFG Investments' costs of the proceeding. For the reasons indicated at [189]-[190] above the claim for that deduction should have been allowed. There should therefore an order in this proceeding that the objection appeal be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with these reasons. The Commissioner must pay Amayana's costs of the proceedings. As explained at [154]-[155] above that claim has succeeded but only in respect of the interest component of the relevant bad debt. There will therefore be an order in this proceeding that the objection appeal be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with these reasons. The Commissioner must pay FGL's costs of the proceedings. As explained at [176]-[178] above, ELFIC's claim has been upheld for each of the relevant years. There must therefore be an order in each proceeding that the objection appeal be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with these reasons. The Commissioner must pay ELFIC's costs of each proceeding. For the reasons indicated at [198] above, the claim for interest should have been allowed. In addition, as explained at [145]-[147] of these reasons EFGT's claim for the bad debt deduction has also succeeded. There should, accordingly, be an order in this proceeding that the objection appeal be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with these reasons. The Commissioner must pay EFGT's costs of the proceeding. The bad debts deduction has bee upheld in respect of both principal and interest as explained at [118]-[125] above. EFGA's claim for a deduction in respect of the liability for interest has also succeeded as indicated at [185] above. There should therefore be an order in this proceeding that the objection appeal be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with these reasons. The Commissioner must pay EFGA's costs of the proceeding. As appears from [194] of these reasons the deduction claimed by EFGS should have been allowed. There should therefore be an order in this proceeding that the objection appeal be allowed, the assessment of 18 December 2006 be set aside and the assessment be remitted to the Commissioner for reassessment in accordance with these reasons. The Commissioner must pay EFG Securities' costs of the proceeding. I certify that the preceding two hundred and eighty-three (283) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan. | deductible expenses written-off bad debts whether deductible under s 25-35, income tax assessment act 1936 (cth) or s 8 1 , income tax assessment act 1997 (cth) whether debts incurred in the "ordinary course of... business" intra-group debt arrangements. deductible expenses whether interest expenses incurred "in carrying on a business" in circumstances of winding down of sections of corporate group. deductible expenses deductibility of losses transferred to corporate group members. avoidance income tax assessment act 1936 (cth), pt iva whether "scheme" for s 177a(1) whether coherent course of conduct engaged in existence and nature of benefit derived. taxation taxation taxation taxation |
Following the defendant's failure to comply with notices given by the Commission, the Court made orders that the defendant appear on a specified day before officers of the Commission for examination and provide the Commission all reasonable assistance with its investigation. 2 The defendant failed to appear on the appointed day. After he was charged with contempt for failing to comply with the Court's orders, the defendant attended an examination by officers of the Commission. He was subsequently charged with contempt for failing to provide the Commission all reasonable assistance in giving answers at that examination. On the day on which the contempt charges were fixed for hearing, undertakings were given by the defendant to the Court that he would attend a further examination and would provide the Commission with all reasonable assistance with its investigation of certain enumerated topics. The hearing was then adjourned until after the date of that further examination. The defendant was subsequently charged with contempt for breach of the undertaking given to the Court. 3 Thus, there are three charges presently before the Court. It is desirable to deal separately with the circumstances relating to each charge. However, before doing so, I shall say something about the circumstances that led to the charges. Section 19 of the ASIC Act applies where the Commission, on reasonable grounds, suspects or believes that a person can give information relevant to a matter that it is investigating under s 13 of the ASIC Act. Under s 19(2), the Commissioner may, by written notice, require such a person to give to the Commission all reasonable assistance in connection with the investigation and to appear before a specified staff member of the Commission for examination on oath and to answer questions. 5 The Commission required the defendant to attend such an examination pursuant to s 19. The defendant did in fact attend an examination on 14 July 2005. However, the examination was adjourned when the defendant said that he wanted to obtain legal advice and representation. However, on five occasions thereafter, the defendant failed to comply with requirements of the Commission to attend for further examination. 6 Section 70 of the ASIC Act applies where the Commission is satisfied that a person has, without reasonable cause, failed to comply with a requirement under s 19. Under s 70(2), the Commissioner may certify the failure to the Court and, under s 70(3), if the Commission does so, the Court may, after inquiry into the case, order the person to comply with the requirement as specified in the order. By instrument dated 11 August 2005, the Commission certified that the defendant had, without reasonable cause, failed on five occasions to comply with such requirements. Accordingly, for reasons given on 16 September 2005 (see [2005] FCA 1350) , the Court ordered the defendant to appear before three named officers of the Commission at 9 am on 28 September 2005 at ASIC's Sydney office, for examination on oath and to provide the Commission all reasonable assistance with its investigation, pursuant to the notices given by the Commission to the defendant under s 19(2) of the ASIC Act. 7 The orders of 16 September 2005 were duly served on the defendant. However, on 28 September 2005, a person who said he was a friend of the defendant and who identified himself as 'Michael', whom the defendant subsequently identified as Mr Michael Rappaport, telephoned one of the officers before whom the examination was to take place. Mr Rappaport told the officer that the defendant was ' depressed ' and would not be attending the examination. The defendant did not attend ASIC's office on 28 September 2005. 8 Later on that day, the Commission wrote to the defendant enclosing a copy of the orders made on 16 September 2005 and the reasons for those orders. The letter referred to the telephone call from ' Michael ' and stated that nothing said by him constituted a reasonable excuse for the defendant's non-attendance. The Commission asserted that the defendant was in contempt of the orders made on 16 September 2005 and said that, if the Commission did not receive some communication from the defendant by 30 September 2005, the Commission may take further action. Telephone numbers for officers of the Commission were included in the letter. 9 On 30 September 2005, the Commission received a telephone call from Ms Brenda Duchen, who said that she was acting for the defendant and was instructed to accept service of a notice under s 19 of the ASIC Act, requiring the defendant to appear for examination on 6 October 2005. Such a notice was given to the defendant. However, on 5 October 2005, the Commission received another telephone call from Mr Rappaport indicating that Ms Duchen was no longer acting for the defendant. Later in the day, the Commission received a further telephone call from Mr Rappaport, during which he said that the defendant would not be attending any examination on 6 October 2005. 10 On 10 November 2005, the Commission applied, by notice of motion, for orders that the defendant be found guilty of contempt. The application was returnable before me on 9 December 2005 for directions. 11 On that day, the defendant appeared in person. When asked whether he had a good reason for not having complied with the Court's orders of 16 September 2005, the defendant said that he was unable to attend the examination for medical reasons. While he asserted that he had told the Commission about the alleged medical reasons, that was disputed by the Commission. I informed the defendant that he must realise that he was in very serious trouble and that, if the contempt charge were to be made out, he may be sent to prison. I told him that, as a citizen, he must abide by the law and must take it seriously in future. 12 The Commission indicated that it was amenable to conducting an examination of the defendant at a mutually convenient time in January 2006. I therefore fixed the contempt charge for directions on 3 March 2006 and informed the defendant that, if, in the meantime, he had attended an examination at a time that was suitable, that may have a very significant bearing on what would happen with the contempt charge. 13 The defendant, in fact, attended at the Commission's Sydney office on 3 February 2006 and was examined by three officers of the Commission. However, the Commission and its officers were not satisfied with the extent of co-operation that was received from the defendant in the course of that examination. 14 When the matter came before me again for directions on 3 March 2006, the Commission indicated that it wished to amend the statement of charge to include a complaint that, in addition to failing to appear for examination on 28 September 2005, the defendant did not provide the Commission all reasonable assistance with its investigation at the examination that he attended on 3 February 2006. An amended statement of charge was subsequently filed and the proceeding was fixed for hearing on 25 May 2006. 15 On 25 May 2006, the defendant again appeared in person and applied for an adjournment of the hearing. That application was opposed by the Commission. Ultimately, the defendant proffered an undertaking to the Court that he would appear before named officers of the Commission on 6 June 2006, at the Commission's Sydney office, for examination on oath on enumerated topics and that he would provide the Commission with all reasonable assistance with its investigation of those topics. 16 The defendant attended an examination at the Commission's offices on 6 June 2006. He was represented by counsel and solicitor and answered questions put by the Commission's officers. Once again, however, the Commission and its officers were not satisfied with the degree of co-operation received from the defendant in answering questions. 17 When the proceeding was called on for hearing on 9 August 2006, the defendant appeared by counsel and solicitor. At the commencement of the hearing, without objection from the defendant, a further amended statement of charge was filed, adding the third charge, relating to the examination on 6 June 2006. The defendant was cross-examined by counsel for the Commission. 18 In the course of the hearing, counsel for the defendant sought leave to rely upon an affidavit sworn on 8 August 2006 by Dr Claudia Nicholson, a general medical practitioner. The affidavit related to consultations of Dr Nicholson by the defendant in April 2004 and on 14 February 2006 and 5 March 2006. Copies of Dr Nicholson's clinical notes were annexed to the affidavit. 19 Also annexed to the affidavit of Dr Nicholson was a report by Dr Nicholson dated 5 March 2006 and addressed ' To Whom it May Concern '. In the report, Dr Nicholson said that she believes that the defendant suffers from episodes of panic attacks and that, as panic attacks can be quite debilitating, that is a valid medical reason for the defendant being incapacitated on the morning of a failed court attendance. Dr Nicholson did not refer to any particular failed court attendance in the report. 20 Counsel for the Commission objected to any reliance on the affidavit unless Dr Nicholson were available for cross-examination. On the defendant's application, therefore, I adjourned the hearing of the proceeding and gave leave for the issue of a subpoena to Dr Nicholson requiring her to attend Court to give oral evidence. The matter was fixed for further hearing on 25 October 2006. 21 Although a subpoena was issued, Dr Nicholson did not attend Court on 25 October 2006. My Associate received a message from Dr Nicholson indicating that she had been unable to communicate with the solicitor who had the subpoena issued and would, therefore, not be able to attend Court. In the circumstances, I did not permit the defendant to rely on Dr Nicholson's evidence. 22 Counsel who appeared for the defendant on 25 October 2006 sought a further adjournment on the basis that he had only been instructed less than 48 hours before the hearing. The Commission opposed any further adjournment. However, the Commission did not oppose counsel being given an opportunity to make written submissions on behalf of the defendant. I therefore gave directions for written submissions to be made on behalf of the defendant and the Commission. I have now received written submissions from both, but limited to the question of whether the defendant is guilty of contempt as charged. Any question of penalty is to be dealt with only if I find the charges proved. The disobedience must be wilful in the sense that it is not casual, accidental or unintentional. The same principle applies in relation to the breach of an undertaking given to the Court. That is to say, wilful breach of an undertaking given to the Court would be contempt if the breach was not casual, accidental or unintentional. Putting it another way, the breach of the order of the Court or an undertaking to the Court must be contumacious, as being wilful and obstinate disobedience involving insult to, or defiance of, the Court. The defendant knowingly, and in wilful and contumacious disregard of the orders made on 16 September 2005, did not provide the Commission all reasonable assistance with its investigation in that the defendant failed to answer questions, and/or alternatively, provide information according to the defendant's knowledge, recollection and/or belief, in response to questions by examiners, on the following matters. The question is whether the defendant had a reasonable excuse for not attending, such that it might be concluded that the failure to attend was casual, accidental or unintentional. 27 The defendant did not dispute that his attitude towards the Commission has been unsatisfactory in a number of respects. When he attended to be examined on 14 July 2005, an adjournment for him to obtain legal representation was readily granted. He says that demonstrates an acceptance by the Commission of the reasonableness of being represented. 29 However, there is no reliable evidence from the defendant as to any steps that he took to obtain legal representation. Further, when the defendant appeared before the Court on 9 December 2005, he did not refer to any inability to organise legal representation as an explanation for his non-attendance on 28 September 2005. 30 The Commission has not suggested that the defendant had funds available to obtain legal representation. Indeed, on 10 May 2006, a sequestration order was made in respect of the defendant's estate. Nevertheless, it cannot be doubted that the defendant was aware of the orders made by the Court on 16 September 2005. No attempt was made by him to inform the Court that he did not wish to attend an examination without legal representation and that he could not obtain legal representation because of his impecuniosity. 31 The defendant relied on an affidavit of 10 February 2006, purporting to explain his failure to attend on 28 September 2005. In that affidavit, the defendant asserted that, during the period after his initial interview, on 14 July 2005, he was unable to attend the ' meetings ' because he was ' continually attempting to obtain funding for legal advice '. He said that he attempted first to obtain funding from his family and that subsequently ' Legal Aid declined my application '. That may have been the explanation for the defendant's failures to comply with the Commission's requirement that led to the orders of 16 September 2006. However, the defendant did not suggest in his affidavit that his inability to obtain funding in order to obtain legal representation was the reason for his failure to comply with the Court's orders. 32 In his affidavit of 10 February 2006, the defendant also went on to assert that he had been suffering ' from a completely debilitating potentially life threatening medical condition '. He said that continual conflict with his family and stress from extensive financial losses sustained in the share market and other financial matters combined to worsen his ' existing medical condition '. He said that the only reason he continually delayed ' the meeting ' was ' due to medical situation which was beyond my control and my state of mind at the time '. He said that he believed he would not be able to assist the Commission and provide accurate information and that his medical condition can ' be significantly worsened by stress '. 33 In an affidavit sworn on 8 August 2006, the defendant asserted that, as a result of his experience on 14 July 2005, he became extremely nervous and apprehensive when he was notified about the examination on 28 September 2005. He said that he feared he would be subjected to a thorough examination by three persons skilled in asking questions, with all the relevant documents at their disposal, on a wide ranging series of topics. He said that his anxiety and apprehension built up for the weeks prior to 28 September 2005 and he was unable to sleep. He said that attacks of heart palpitations and anxiety increased such that, by the evening of 27 September 2005, he was extremely apprehensive about the examination and felt physically ill. The defendant said that, during the course of that evening, he spoke to Mr Rappaport by telephone and asked him if he would tell the Commission officers that he would not be able to attend on the following day. 34 Even if Dr Nicholson's evidence were admitted, it would not be satisfactory evidence to indicate that the defendant's medical condition interfered in any way whatsoever with his ability to attend for examination on 28 September 2005. The defendant was given the opportunity of calling admissible medical evidence but did not avail himself of that opportunity. His bare assertion that he was suffering from a potentially life threatening medical condition carries no weight and I reject it. 35 The defendant made no effort to inform the Commission that he would not attend the examination on 28 September 2006, until Mr Rappaport telephoned the Commission officers early on that day to say that the defendant would not attend. No satisfactory evidence was adduced to explain the connection between Mr Rappaport and the defendant, or why the defendant could not have spoken to the Commission officers himself. Even when Mr Rappaport spoke to the Commission officers, there was no suggestion that the reason why the defendant would not attend was his inability to obtain legal representation. Rather, all that Mr Rappaport said was that the defendant was ' depressed '. 36 Even if the defendant had tried unsuccessfully to obtain legal representation, that is no justification for failing to comply with the Court's order. The defendant accepts that he can be severely criticised for his failure to alert the Commission to his inability to obtain legal representation. However, be that as it may, the circumstances outlined above persuade me that the inability to obtain legal representation did not operate on the defendant's mind in failing to comply with the Court's order to attend for examination on 28 September 2006. I do not accept that that was the reason why he did not attend to be examined. 37 I am satisfied beyond reasonable doubt that the defendant's disregard of the Court's order was wilful and was not the result of any accidental, unintentional or casual circumstance. He simply did not treat the Court's order as requiring any action on his part despite the unequivocal nature of its terms. To say that he thought that it was sufficient to have a friend telephone the Commission and say that he was not going to attend because he was depressed indicates a serious disregard of the authority of the Court. I find that the defendant was guilty of contempt of the Court by reason of his failure to attend to be examined by officers of the Commission on 28 September 2006. He was also informed of the terms of s 68 of the ASIC Act and acknowledged that he understood that, if he made a proper claim of privilege before making a statement at the examination, the statement could not be admitted against him in subsequent criminal proceedings or proceedings to impose a penalty. He said that he understood that if he wished to claim the benefit of s 68 in relation to an answer it would be sufficient if he said the word ' privilege ' before giving the answer. 39 Notwithstanding his acknowledgement that he understood his right to claim privilege, the defendant did not generally do so in the course of the examination. The Commission suggests that an inference can be drawn, from the failure to claim privilege and the failure to give fair answers to questions, that the defendant was concerned not to incriminate others. The Commission contends that answers given to a number of questions posed on 3 February 2006, as summarised below, demonstrate that the defendant's attitude was unco-operative towards the officers of the Commission, who were exercising powers and functions in the public interest. The Commission says that the defendant was simply being obstructive and that his conduct was the antithesis of providing all reasonable assistance to the Commission with its investigation. 40 The defendant accepted that, when he attended the Commission offices on 3 February 2006 for examination, he was conscious of the warning that I had given him at the directions hearing in December 2005 that if he did not co-operate with the Commission he ran the risk of a prison sentence. At no stage during the examination, did the defendant complain about chest pains or indicate any mental incapacity or memory problems that might have affected his ability to give evidence, although he did say at one stage that he did not ' feel well today ', without being more specific. He did not inform the Commission's officers that he felt depressed. At no stage did he seek an adjournment of the examination, notwithstanding his acknowledgement that he knew of the right to request an adjournment. 41 The defendant was asked why he established a margin lending facility and his response was that he did not know. In his affidavit of 8 August 2006, he indicated his understanding of what such a facility was. However, in the course of cross-examination on 9 August 2006, he said that he did not understand the question asked of him on 3 February 2006. I do not accept that the defendant did not understand the question. For whatever reason, he wilfully chose not to make a genuine attempt to answer the question. 42 The defendant was also asked on 3 February 2006 who advised him to open a margin lending account. His response was that he did not remember. In his affidavit of 8 August 2006, the defendant said that it was a broker who advised him to open the margin lending account. There is no reason why he could not have given even that barely sufficient answer on 3 February 2006. 43 When asked on 9 August 2006 why he did not remember the names of the only two brokers he knew, one of whom gave him advice to open a $1 million margin lending facility, the defendant described that information as ' irrelevant ' or ' no big deal '. He compared remembering the name of the broker who gave him such advice to remembering the name of a person one might bump into on a bus. Those answers are indicative of the unhelpful attitude that the defendant took to answering questions on 3 February 2006. 44 The defendant was also asked a series of questions concerning a ' Macquarie Trading Power ' signed by him in November 2004. He said that he did not know what ' Macquarie Trading Power ' means and he did not remember ever making an application for a Macquarie Trading Power. When asked if someone advised him to open the Macquarie Trading Power account, the defendant replied that he had no idea. His attention was drawn to the broker adviser name at the top of the page signed by him, which was ' E Trade '. When asked whether he was receiving advice from E Trade, the defendant said that he believed he ' had an account with E Trade '. However, he said that he could not remember receiving any advice from E Trade. 45 The defendant was asked how he found out that Macquarie Bank offered a ' Trading Power ' but said that he did not know. 46 When asked which internet cafes the defendant frequented during that time he said ' All around I think Bondi and the City '. When asked whether there were any particular places he said ' Not that I know of '. He could not remember whether there was anybody that he would particularly speak to or meet at such internet cafes. When asked again whether it was his habit to take advice from people he did not know well, the defendant responded ' Yes. Isn't that human nature? Like, no one listened to the Prime Minister, like take advice from people you don't know '. 49 The defendant was then shown a Macquarie margin lending loan application. When asked what prompted him to ask for an increased limit on his margin loan, the defendant replied that he did not know. I, I might have though... I don't think so. No, can't remember. Maybe I had other margin accounts that year, other limits, I don't know. I don't know. Maybe it was. When asked on 9 August 2006 why he could not recall in February 2006 a conversation with ' Sid ' but could recall the conversation six months later, the defendant simply said that he could not remember and then said that he felt intimated by the Commission examiners. 51 Later, the defendant was asked what he understood by the term ' margin call '. He said that he did not remember what it meant. He said ' Maybe I did, but I don't remember at this point what it means --- margin call. He responded ' Maybe, yes '. When asked what he meant by ' Maybe ' he said ' Maybe it did happen to me and I don't remember '. Nevertheless, in his affidavit of 8 August 2006, the defendant admitted that he had received a margin call in February or March 2005, but could supply no plausible explanation for why he could not remember that information in February 2006. 53 Next, the defendant was asked why he ceased to be a director of Medina Corp. The defendant claimed privilege. The defendant was asked what Medina Corp did. He said that he was told they bought property and they rented it out to sophisticated people. He said that ' my other director ', Michael Rappaport, told him. It's personal '. You got nothing to do with it. I just can't --- it's a personal issue. I --- and I feel like I wish to not want to discuss it to strangers, and it's personal... It's a personal issue... It's a personal issue and I wish not to discuss it. Privilege '. Notwithstanding those responses at the examination on 3 February 2006, the defendant made no attempt to seek an adjournment to obtain legal advice in relation to the matter. Notwithstanding those answers, the defendant asserted in his affidavit of 8 August 2006 that one of the ' differences ' was a change in the rate of commission he was to receive. 55 The defendant was also asked how much money he actually received as a director of Medina Corp. His response was that he did not recall. He was asked whether the sum that he was actually paid for his work was somewhere near $120,000 and his response was ' close to it '. The defendant was asked several times how he was paid that amount but said that he could not remember how it was paid. He was asked specifically if he was paid in cash. His response was that he did not recall. 56 The defendant was asked whether it was right that he claimed that he was paid about $120,000 from Medina. He replied ' Things fell through '. I said things fell through. Unforeseen circumstances, mate. Things happen. What can you do? I am satisfied beyond reasonable doubt that the defendant was deliberately not making a genuine attempt to assist the Commission by answering questions to the best of his knowledge. While the defendant attended an examination by the Commission's officers on 3 February 2006, the defendant did not provide the Commission with all reasonable assistance with its investigation. If find the defendant guilty of the second charge. The defendant responded that it was ' the broker from Morrisons, Sid, told me I should extend my limit '. I don't know. Maybe I'm just a soft person, people can manipulate me easily, take advantage of me. He could not remember whether a broker from Morrisons suggested the figure of $3 million. 59 At the examination on 6 June 2006, the defendant was asked again about the unforeseen circumstances that led to his resignation as a director of Medina Corp. At various times, the defendant referred to mental instability and depression as well as to ' differences ', without explaining what the differences were. While he eventually provided a meaningful response to the enquiry concerning his resignation in his affidavit of 8 August 2006, he admitted that he did not disclose the reasons to the Commission in his examination on 6 June 2006. 60 The defendant contends that, even if he could have supplied further information in answering the questions posed, that is not a basis for finding that he acted in wilful disregard of his undertaking, or contumaciously in responding to the examiners' questions. Such a submission may have had some substance if there was but one instance of the defendant failing to comply with the Court's orders. However, in a context where the defendant failed to attend on 28 September 2006, failed to give assistance on 3 February 2006 and then gave an undertaking to co-operate, the defendant must have had no doubt that he should provide as much information as he could in responding to the question on the specified topics on 6 June 2006. 61 I am satisfied beyond reasonable doubt that the defendant made no real effort to comply with his undertakings to the Court that he would provide the Commission with all reasonable assistance with the investigation of his dealings with Macquarie Bank and his relationships with associates. I therefore find the defendant guilty of contempt by reason of that failure. I will give directions for the parties to make submissions on the appropriate penalty. I certify that the preceding sixty-two (62) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett. | contempt charges defendant failed to comply with notices to attend examination and give assistance to the australian securities and investments commission court ordered him to attend and give assistance defendant failed to comply with court's orders undertakings given to the court that were subsequently breached whether defendant's conduct in not complying with the orders and breaching the undertakings was wilful and contumacious practice & procedure |
It encountered financial difficulties and administrators were appointed in November 2004. A Deed of Company Arrangement (the Deed) was adopted by a meeting of creditors in February 2005. It was supported financially by Mr Lindsay Forrest, his company, Forrest Nursery Pty Ltd (Forrest Nursery) and Mr Barry Richardson. 2 A proposed business plan, which pre-dated the Deed, was found not to be viable and Messrs Forrest and Richardson, who had been appointed as directors of Euco, proposed a variation of the Deed. Unfortunately Mr Richardson, who was to represent both their interests, was unable to attend a meeting of creditors held on 24 March 2006 to consider the variation and the alternative of winding up the company. He was admitted to hospital as the result of an apparent angina attack on his way to the meeting. In the absence of the Forrest and Richardson interests, the creditors resolved to terminate the Deed and wind up the company. Had Mr Richardson been present with proxies for himself and Mr Forrest's interests it is likely that the proposal to vary the Deed would have been accepted. 3 Forrest Nursery and Mr Richardson now apply to the Court for orders terminating the winding up, setting aside the termination of the Deed and ordering the variation of the Deed in accordance with their original proposal. 4 The liquidators recommended the variation, they have no objection to the proposed orders and nor do any of the creditors who have all been notified. In my opinion, there is no question of public interest or commercial morality against the making of the orders sought. I am also satisfied that the Court has the power to make those orders. Accordingly, the winding up will be terminated, the termination of the Deed set aside, subject to any unforeseen effects upon third party interests which will be covered by liberty to apply. I will also order that the variation proposed by Messrs Richardson and Forrest should be given effect. It has been involved in the development of methods of planting and harvesting Mallee trees and extracting eucalyptus oil from them. It is said to have only two items of tangible assets of any significant value, being a steam distillation plant and an oil decanter. The steam distillation plant is used for the extraction of oil from organic Mallee material and the oil decanter to allow the removal of water from the oil. Euco also has a patent, not before the Court, which is said to relate to the method of planting Mallee trees. The patent, however, is said, by Mr Richardson, not to have any significant value. 6 On 8 November 2004 Evan Robin Verge and George Aubrey Lopez were appointed by the Board of Euco as joint and several administrators of the company pursuant to s 436A of the Corporations Act 2001 (Cth) (the Act). On or about 21 January 2005 they received a proposal for a Deed of Company Arrangement. The proposal was made by Barry Richardson on behalf of himself and Forrest Nursery. Mr Richardson was representative of a company called Timbertech Pty Ltd (Timbertech) which was Euco's fifth largest creditor. Forrest Nursery was the major creditor of Euco. Mr Forrest was a director of that company. The parties to the Deed were the administrators who were designated as 'Deed Administrators', Euco and Forrest Nursery. At the second meeting of the Company's Creditors the Company's Creditors resolved pursuant to s 439C(a) of the Corporations Act 2001 that the Company execute a deed of company arrangement on the terms and conditions contained in this Deed. This Deed has been prepared by the Deed Administrator in accordance with s 444A(3) of the Corporations Act 2001 as the instrument setting out the terms of the deed of company arrangement that the Company's Creditors resolved that the Company execute. The Oil Receipts represented '... the sale price of the Eucalyptus/Mallee oil sold by Euco during the period 1 July 2006 to 30 June 2008 as produced by Euco from its business operations' (cl 35.24). The Research Rebates were the refunds for the financial years ended 30 June 2004 and 30 June 2005 respectively to be received from the Australian Taxation Office relating directly to a research and development offset shown in Euco's income tax return for each of those years (cl 35.12 and 35.31). Forrest Nursery agreed to make loans to Euco up to a maximum of $158,000 in the financial year ended 30 June 2005 and up to a further $25,000 in the financial year ended 30 June 2006 (cl 8). Forrest Nursery agreed that no interest would be payable on the loans. The money was to be applied, under the terms of the Deed, to the payment of dividends to defined groups of creditors. A 'Farmers' Group Creditor' was defined as '...a Participating Creditor with a debt payable by or claim against the Company in relation to a prepayment for the planting of seedlings which has yet to be performed (but only in respect of that debt or claim)' (cl 35.11). 10 Under the Deed, Forrest Nursery was to be allotted and issued shares in Euco. 3,500,000 shares were to be allotted to it within two months after the date of the Deed. The remaining shares were to be allotted and issued to it or its nominee immediately before the termination of the Deed. The Deed was to terminate on 30 June 2008 and otherwise upon a Court order or a creditors' resolution. Of the 3,500,000 shares allotted to Forrest Nursery, 2 million shares were transferred to Mr Richardson under an agreement it had with him. In the result the control of Euco was transferred to Forrest Nursery. Lindsay Forrest and Barry Richardson were appointed as directors. They have been Euco's only directors since shortly after the Deed was signed. 11 According to Mr Richardson's affidavit evidence, he agreed to and voted for the Deed on the basis of a business plan which had been developed for Euco by its previous directors. Under the Deed Euco could continue its operations and provide funds from its operating activities to pay to the Deed Administrators so they could in turn discharge liabilities to creditors. This was reflected in the provision for application of the Oil Receipts to the payment of creditor dividends. 12 Following the appointment of Messrs Forrest and Richardson to the Board of Euco they spent a considerable amount of time considering and analysing Euco's previous business plan. As noted earlier, Euco's patent is said, by Mr Richardson, not to have any significant value. And although a lot of work had gone into developing the concept of exploiting Mallee trees, the know-how is not yet viable or saleable. Euco tried to sell the steam distillation plant and the oil decantering plant. Those sales did not proceed because of disputed claims to ownership by creditors of Euco. None of the remaining plant and equipment has any significant commercial value. 13 Euco has not operated or gained any revenue since the commencement of the Deed, other than the receipt of the First Research Rebate which was provided to the Administrators. Any funds required by it for the development of its business plan have been provided by Forrest Nursery. 14 Messrs Forrest and Richardson decided that the previous business plan was not viable and would have resulted in more losses. They attempted to develop a further business plan and model to allow Euco to operate in a financially viable manner in the future. 15 It became apparent to them, after some time, that Euco was not going to be in a position to commence commercial trading or to earn profits for a number of years. There was little point, in their view, in continuing the operation of the Deed and the incurring of administrators' fees. They developed a proposal for its variation and for external funding of a partial payment to creditors. Mr Richardson met with Mr Lopez and a Mr Carl Huxtable of his firm Jones Condon to discuss the proposal. This led to a proposal for an amendment to the Deed which was sent out to Euco's creditors with a Circular dated 14 March 2006 and a Notice of Meeting ,to be held on 24 March 2006. Group E Creditors will receive a final payment of 5 cents in the dollar. He was in Donnybrook at the time. On his trip to Perth, which commenced on 23 March 2006, he suffered transient chest pains. He stopped overnight with his parents in Binningup. On the following day he travelled to his home at 6 Spey Road, Applecross to check mail before the meeting. No notice of the meeting had come to that address. His chest pains recurred and increased. He called a taxi and went to Sir Charles Gairdner Hospital. He was there subjected to a variety of tests. He was unable to contact the Administrators by telephone until about 11.30 that morning. He was informed by Mr Huxtable that the Creditors' Meeting had finished and that the resolution to amend the Deed had not been put. Neither Mr Richardson nor any representative of Forrest Nursery had been present. A resolution had been passed by the creditors to terminate it and place Euco in liquidation. Mr Richardson said that before his telephone conversation with Mr Huxtable he was not aware that neither Mr Forrest nor any other representative of Forrest Nursery would be at the meeting. 20 The Circular to creditors was dated 14 March 2006 and sent out on 15 March 2006. It enclosed a Notice of a Meeting to be held on 24 March 2006 at the offices of Jones Condon. The Deed Administrators recommended that the variation to the Deed be accepted. It appears from Mr Verge's evidence that the Circular addressed to Mr Richardson was returned to the Administrators' office before the meeting. It was then sent to an alternate address for Mr Richardson which was 6 Spey Road, Applecross. The Deed Administrators had not received any proxy forms from either Forrest Nursery or Timbertech before the meeting. Mr Huxtable attempted to contact Mr Richardson the day before the meeting and on the morning of the meeting and left a message on his telephone. 21 According to Mr Richardson the placement of Euco into liquidation is not the best result for the creditors or the members of Euco. He does not anticipate that any amounts are likely to be realised from the disposal of Euco's assets other than the fees of the liquidators. The intellectual property of Euco is still significantly under-developed, there is no sustainable business plan and there are competing claims in relation to the only two items of valuable plant which Euco owns. 22 Mr Lopez authorised Mr Huxtable to chair the meeting pursuant to reg 5.6.17 of the Act. As a quorum of creditors was present personally or by proxy, the meeting commenced at 11am. It concluded at approximately 11.35am following a resolution to terminate the Deed and place Euco into liquidation. 23 According to Mr Verge if Forrest Nursery and Mr Richardson had been at, or represented at, the creditors' meeting it was possible that the votes might have been different. As the Deed Administrators themselves had recommended the acceptance of the variation to the Deed any casting vote would have been made in favour of that variation. Mr Verge supported the orders sought in the application now before the Court. 24 The minutes of the meeting of 24 March 2006 showed six creditors represented by three people carrying various proxies. Colin Sharp held proxies for four creditors, Ron Gamble for Wundowie Foundry Pty Ltd and Jeffrey Claflin for Wewis Pty Ltd. The minutes record that there was discussion of the proposed variation. Mr Claflin evidently inquired about the implications of the variation being dismissed and the company being wound up. 25 One of the liquidators, Mr Verge, in his affidavit exhibited a summary of the proxy holders for the creditors' meeting which had been prepared by his staff. The votes represented by Messrs Forrest and Richardson, had they participated, amounted in value to 725,879. Proxies of other creditors specifically directed against variation of the Deed and in favour of winding up were said to amount to 175,800.41 in value. Proxies specifically directed in favour of liquidation were 100,800.41. 75,000 proxy votes in value were directed specifically against liquidation. Other general proxies which were not directed one way or the other, represented 51,872.92 in value. It is likely that had the Forrest and Richardson interests been represented at the meeting, the meeting would have adopted the variation to the Deed. 26 Mr Forrest said in his affidavit that negotiations about the variation were conducted with the Administrators by Mr Richardson on behalf of himself and Forrest Industries. Mr Forrest did not meet with the Administrators about that. He did not know about the meeting on 24 March 2006. His evidence has not been contradicted. He said he did not receive any notice. 27 Notice of the present application was served on all of the Euco creditors, with one exception. That was Landshore Pty Ltd (Landshore) trading as Timbertech Planting Services. It is the trustee for the Timbertech Unit Trust trading as Timbertech Planting Services. It is under administration. Landshore's administrator, however, wrote to the solicitors for Forrest Nursery and Mr Richardson on 19 July 2006 indicating that he did not object to the orders sought in the application. 28 It appears also that the creditor, Wundowie Foundry Pty Ltd, has released Euco from its obligations arising under a lease agreement incurred after the date of the Deed. Wundowie has confirmed in writing that it is only a creditor of Euco to the extent provided for under the Deed. It does not object to the orders sought in the application. Section 447A confers on the Court general power to make orders in relation to that Part. An application for such an order may be made, inter alia, by a creditor of the company. An order for termination can be made under s 482 of the Act. The second question is whether, if such an order were made, a further order should be made under s 447A effectively treating the variation of the Deed as having been carried by the creditors at their meeting of 24 March 2006. 33 Euco evidently has little in the way of funding to meet the liquidators' or administrators' fees. There is some prospect of further benefit to creditors if the variation to the Deed were to take effect. It would offer the opportunity of a further benefit to creditors under the variation proposal. 2. There is no public interest or question of commercial morality weighing against the order. 3. It is likely that the creditors' meeting would not have voted to wind the company up if Mr Richardson had been able to attend it. 4. Mr Richardson's non-attendance was not through any fault of his own but due to a supervening health problem. 5. The creditors have been notified and neither they nor the liquidators object to the proposed orders. 35 The termination of the winding up under s 482 does not of itself reverse the termination of the Deed. Under s 482(3) it is provided that the Court may give directions for the resumption of the management and control of the company by its officers. This power does not in terms extend to a power to reinstate a terminated deed of company arrangement. It is necessary in that connection to consider the power conferred on the Court by s 447A. In so doing, it may be noted that the power of the creditors' meeting to terminate the Deed derived from s 445C(b) of the Act. The power to wind up the company upon termination of the Deed derived from s 445E. Both of these provisions, of course, are part of Pt 5.3A. Its scope was foreshadowed in the Report of the Law Reform Commission of Australia on the General Insolvency Inquiry (ALRC) which led to the enactment of Pt 5.3A in July 1993. 37 The section empowers the Court to do more than just fill in gaps in the legislative scheme or add to the provisions of Pt 5.3A --- Re Brashs Pty Ltd (1994) 15 ACSR 477 at 481 (Hayne J). It empowers the Court 'to make orders which alter what would otherwise be the operation of Pt 5.3A in relation to a particular company' --- Brash Holdings Ltd (Administrator Appointed) v Katile Pty Ltd (1996) 1 VR 24. 38 In Cawthorn, Young J extended the life of a deed which had been terminated. In Re Madden (1996) 26 ACSR 10 at 15 his Honour said that the section was wide enough to allow the Court, in an appropriate case, to disregard the fact that an administration may have ceased because of a mistake in carrying out steps under Pt 5.3A. The court could extend the period for convening a meeting as though the administration were still in force. 39 In Australasian Memory Pty Ltd v Brien [2000] HCA 30 ; (2000) 200 CLR 270, the joint judgment of Gleeson CJ, McHugh, Gummow, Hayne and Callinan JJ acknowledged the width of the powers conferred by s 447A. Section 447A is not properly described as a general power standing apart from Pt 5.3A. It is an integral part of the legislative scheme for which that Part provides. In particular it can apply to alter timetables prescribed by other provisions of Pt 5.3A (at 281 [24]). 2. The words of s 447A do not suggest that it cannot be used if, by operation of the provisions of Pt 5.3A , the administration of the relevant company has come to an end. The section deals with a 'particular company' and the operation of Pt 5.3A in relation to it (at 282 [26]). 3. The words of the section 'how this Part is to operate' look to the future but do not preclude the making of orders with future effect but in respect of past matters or events ( at 282 [26]). 4. (ii) Steps are taken that are predicated upon the company having validly entered a deed of company arrangement or gone into liquidation (at 283 [30]). The court left open the question whether there is power to make an order under s 447A in the first case where the administration has ended (at 284 [32]). Under that variation however, the Deed is to be terminated in any event after its conditions have been fulfilled. There is no suggestion of any third party dealings which could be adversely affected by the orders proposed. In any event, they can be accommodated by liberty to apply, limited in time, to vary the orders made to ensure the protection of any accrued right. 40 I am satisfied that I can set aside the termination of the Deed on the basis that the order operates prospectively. The order setting aside the termination will take effect so that the rights and obligations of all parties will be determined as though the Deed continued in effect from the meeting of creditors and had not been terminated. To the extent that there may be any particular direction necessary to take account of any rights or obligations that have accrued since the Deed was terminated, there will be liberty to apply within the next 28 days for a suitable qualifying order. Given that all creditors have been given notice and none has expressed an objection, I regard the probability of such an application as small, but nevertheless will allow such an application within that time. 41 As to the variation of the Deed there is no doubt that the Court has power to order a variation. The power of the Court to make such an order was considered by Finkelstein J in Re: Pasminco Ltd (No 2) (2004) 49 ACSR 470. The administrators, however, wish to short cut this procedure and have the deed varied by an order made under s 447A. In Milankov Nominees Pty Ltd v Roycol Ltd (1994) 52 FCR 378, 388 Lee J suggested that this could be done. In two decisions in the following year Branson J expressly found the power to exist. The decisions are Re Giga Investments Pty Ltd (Admin Apptd) (No 2) (1995) 13 ACLC 1,185, 1,187 and Mulvaney v Rob Wintulich Pty Ltd (1995) 60 FCR 81, 83. Many cases have followed these decisions. On the basis of these authorities I am satisfied that the power to make variation exists. It appears on the face of it to offer some benefit to creditors. None object, and there is the possibility, although it does not seem great, that Messrs. Forrest and Richardson may be able to revive the company's fortunes. I will therefore make the variation order but in prospective terms rather than the apparently retrospective terms sought by the applicants. I will require notice to be given to all creditors of these orders and allow liberty to apply within 28 days for any variation of the order setting aside the termination of the Deed to the extent that it may impinge upon accrued rights. I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. | administration deed of company arrangement termination of deed by resolution of creditors resolution to wind up company major creditor and proponent of variation to deed of arrangement absent from creditors' meeting absence due to health emergency no proxies at creditors' meeting likelihood meeting would have voted for variation if major creditor present application to set aside winding up and termination of deed application to vary deed variation recommended by the liquidators no objection by creditors no public interest or commercial morality consideration orders sought made corporations |
2 The Appellant is a citizen of the People's Republic of China who arrived in Australia on 13 August 2006. On 8 September, the Appellant lodged an Application for a protection visa. A delegate of the First Respondent refused the application on 14 November 2006. On 14 December 2006 the Appellant applied to the Tribunal for a review of the decision. On 14 February 2007 the Tribunal sent a letter to the Appellant's authorised recipient, inviting comment on information that would form part of the reason for the Tribunal's decision. On 9 March 2007 the Appellant sent a statement to the Tribunal in response to the letter. The Tribunal did not accept the Appellant's claims as, in the Tribunal's opinion, the Appellant lacked knowledge of Christianity and gave vague and rehearsed evidence. Further, the Appellant's claim in relation to his wife's alleged forced abortion was found to be inconsistent with independent country information and his own evidence. Scarlett FM ruled that the complaint amounted to a challenge to the Tribunal's factual findings and was therefore unable to be reviewed. His Honour also found that the Tribunal did take into account the Appellant's contention that the interpreter was unable to express the Appellant's correct denomination, however his Honour noted that nothing turned on that point. 6 The Federal Magistrates Court noted that independent country information is an exception to s 424A(1)(3)(a) of the 1958 Act, and that further, the Appellant's inconsistent evidence was based on information given by him to the Tribunal for the purpose of the Application, which was also found to be exempt under s 424A(3)(b). Scarlett FM noted that s 424A did not apply because inconsistent evidence is part of the Tribunal's subjective appraisals or thought processes: see SZBYR v Minister for Immigration and Citizenship [2007] HCA 26 , 235 ALR 609. 7 Scarlett FM found no evidence that there had been a lack of good faith or bias by the Tribunal, or that any jurisdictional error could be discerned from the Tribunal's reasons. The Federal Magistrates Court therefore dismissed the Application. GROUNDS OF APPEAL. The Federal Magistrate was wrong in finding that the Refugee Review Tribunal ("the Tribunal") acted properly in its findings. Those particulars, in summary form, contend that the Tribunal considered information provided during an interview with the Department on 10 October 2006 without providing a transcript or a recorded tape of the interview. This failure, as elaborated in the particulars, is said to constitute a failure to comply with s 424A(1) of the Migration Act 1958 (Cth). 9 Neither of the grounds of appeal, construed in the context of the particulars provided, have been made out. The appeal should therefore be dismissed. The misstatement of evidence and a failure to provide a transcript. These denials were also repeated during an oral statement made at the outset of the hearing of this appeal. 12 Given the denials, it is perhaps understandable that the Appellant desires a transcript of what was in fact said during the departmental interview. In the present appeal however, there are a number of answers to the Appellant's contentions. First, it is not considered that there was any requirement to provide the Appellant with transcript or recording of the interview . In some circumstances, fairness may require a transcript of proceedings to be provided: see National Companies & Securities Commission v Bankers Trust Australia Ltd (1989) 24 FCR 217. There is, however, no immutable requirement to do so: see Adler v Cantwell (1988) 14 ACLR 658. 13 The content of the requirements of procedural fairness is to be determined by reference to the context in which a particular dispute arises including, in particular, the legislative regime being administered. In the present circumstances, s 422B of the Migration Act 1958 (Cth) provides that Div 4 of Pt 7 " is taken too be an exhaustive statement of the requirements of the natural justice hearing rule ". Neither that Part nor any other provision of the 1958 Act requires a claimant to be provided with a transcript or a tape recording of an interview with the Department. 14 Even in the absence of s 422B, it is not considered that the common law rules of procedural fairness require the provision of a transcript or a tape recording of the interview on 10 October 2006. Notwithstanding expected difficulties which may arise with respect to a person whose English language proficiency is severely limited, the factual matters being considered are within a narrow compass and are matters within the knowledge of the Appellant. Although there may be potential for misunderstandings between those participating in the interview process, the necessity to retain a tape recording of such interviews or to provide a transcript seems to be an unwarranted formality not required by the common law. 15 Second, and irrespective of what was said or not said during the departmental interview, the Appellant's knowledge of Christianity and his detention in China was the subject of inquiry by the Tribunal. The Tribunal heard the Appellant's evidence and made its findings on these issues of fact. Moreover, on 14 February 2007, the Tribunal wrote to the Appellant inviting him to comment on a number of inconsistencies between the account provided during the interview on 10 October 2006 and the hearing before the Tribunal on 12 February 2007. The Appellant responded by way of a letter dated 9 March 2007. However, it is the fact that I was detained by the PSB for the first time in October 2005 and I was caught distributing propaganda materials. The response of the Appellant was not to then deny the accuracy of the departmental account but rather to answer in part the inconsistencies identified by the Tribunal. The opportunity was extended to the Appellant to comment in such manner as he saw fit in response to the Tribunal's letter. 16 Third, the first occasion upon which a copy of the transcript or a copy of any tape recording was sought was subsequent to the Tribunal hearing. It is not considered that there was any procedural unfairness in the Tribunal or officers of the Department not providing the Appellant, in advance of the hearing, with that which he had not at that stage sought. Inquiries made during the course of the hearing of the appeal have, in any event, been inconclusive as to whether or not a transcript or a tape recording presently exists. It is not considered that the Tribunal proceeded in any procedurally unfair manner. The Appellant has been given every opportunity before the Tribunal to make such submissions as he saw fit. 17 Fourth, there is no breach of s 424A(1). The Applicant is certainly entitled to receive a tape-recording of his evidence to the Refugee Review Tribunal, but that is a different matter. The Applicant in his first ground takes issue with what he is reported to have said at the Departmental hearing, but in my view his complaint is a challenge to the Tribunal's factual findings and is in effect a request for the Court to conduct a merits review. That is not available on judicial review as I have explained. Thus it is clear that the " clear particulars " had in fact been provided to the Appellant and, to the extent that findings were made as to any " inconsistencies ", s 424A does not apply to such matters. It is definitely a significant mistake of the interpreter at the Departmental interview, who was unable to translate "Christian Assembly" properly and accurately. 19 No finding was made by the Tribunal as to the Appellant's Christian denomination. The applicant's comments do not allay the Tribunal's concerns over his lack of knowledge about Christianity, as expressed at the Departmental interview. At the Departmental interview he stated that being a Christian meant that he believed in the law of God and he was scared of the Devil. The applicant did not address this response in his comments to the Tribunal. " Insofar as the Tribunal made further findings of credibility adverse to the Appellant, it was the function of the Tribunal to make findings of fact. 20 No error can be discerned in the findings or the reasons of the Tribunal, let alone any jurisdictional error. This final ground of appeal is therefore dismissed. The Appellant to pay the First Respondent's costs of an incidental to the hearing of this appeal on 23 November 2007, otherwise each party to pay their own costs of 26 November 2007. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Flick. | migration act 1958 (cth) does not entitle an applicant to be provided with a transcript of visa application interview common law procedural fairness does not require an applicant to be provided with a transcript of visa application interview under migration act 1958 (cth) migration |
2 The background facts are largely not in dispute although the Trustee, through its counsel, made it clear that because the Tribunal did not make, or was not even in a position, having regard to the state of the evidence before it, to make any finding of fact that the application for payment was a forgery, the Trustee was not to be taken to be making any concession or admission on this factual issue. (2) The applicant was originally a member of the Eagle Retirement Fund pursuant to an application for membership made on 3 December 1986 to Australian Eagle Insurance Company Limited. By a process of transfer and amalgamation, which is not in dispute, that fund became subject to the Universal Super Scheme Trust Deed (as amended from time to time relevantly up to 29 June 2001). (3) The applicant's superannuation account contained only unrestricted non-preserved funds and thus could be withdrawn at any time subject to the powers and discretions of the Trustee under the deed. (4) The Trustee received a telephone request from the applicant's wife on 14 August 2001 to send withdrawal forms for the applicant. The Trustee sent the forms with a letter of advice to the applicant's then home address on 16 August 2001. (5) The forms were returned to the Trustee on or about 23 August 2001 apparently completed by the applicant on or about 22 August 2001. (6) The applicant's signature on the withdrawal form was verified by comparison with the specimen signature on the original application because the withdrawal request was for more than $10,000 and requested payment of the amount into a joint bank account which the applicant maintained with his wife, Robyn Joy Price. (7) The balance of the superannuation account in the sum of $31,455.82 was deposited by the Trustee into this joint bank account and credited on 4 September 2001. (8) The funds paid in by the Trustee were disbursed from the joint bank account over the course of about two months by payment of household bills, various cash withdrawals and cheque payments and, as to $18,200, for the purchase of a motor vehicle, apparently for or by the applicant. (9) Confirmation of the transaction was posted to the applicant's home address on 3 or 4 September 2001. (10) Enclosed with the confirmation letter was an Eligible Termination Payment form which was required to be submitted with the applicant's personal income tax return for the financial year 2002. (11) On or about 11 January 2005 (i.e. more than 3.5 years later) the Trustee received a letter from the applicant dated 8 January 2005, asserting that his signature on the withdrawal form had been forged by his wife and requesting that, if the fraud is proven, his account be reinstated. The applicant supplied a statement by himself and one said to be by his wife and supporting summaries of what the applicant asserted was his financial position. The Trustee declined to reinstate the account. (12) The applicant requested that the Trustee provide documents to the police for neutral examination of the claimed fraud. The Trustee provided copy documents to the applicant to pass on to the police at his discretion. (13) The applicant complained to the Superannuation Complaints Tribunal by letter dated 7 March 2005. Although the terms of the complaint appear to be mainly directed to what the applicant perceived as the Trustee's failure to 'be part of' the police investigation, it is apparent that the Tribunal treated the complaint as concerning the Trustee's decision to decline reinstatement of the account or, in the applicant's words, to give 'a speedy and just settlement' of the applicant's claim. (14) The Tribunal received submissions from both parties and received the 'evidence' enclosed with the applicant's letter to the Trustee, the relevant correspondence between the parties and the extract of the applicant's bank records. The Tribunal had the historical trust deeds for the fund. (15) The Tribunal affirmed the Trustee's decision not to reinstate the applicant's account. In reaching its determination, the Tribunal took the whole of the evidence and submissions into account. In a document dated 16 August 2001 the Trustee wrote to the Complainant providing an illustration of the benefit he would receive if he withdrew from the Fund due to retirement. This was sent to the address at which the Complainant resides. Whilst the Complainant indicates that he did not receive the document he also submitted that his wife had the only keys to the letter box and he only saw items that his wife chose to hand over. The Tribunal believes that the Complainant in consenting to this arrangement had in effect appointed his wife as his agent and therefore the Trustee could reasonably have regarded the document as having been provided to the Complainant. The Trustee may reasonably have assumed that the form came from the Complainant on the basis that it was provided to the Complainant by the Fund. The signature on the withdrawal form was checked by the Trustee against the Complainant's application to join the Fund. Almost 16 years had elapsed between the two signatures. The Tribunal has no handwriting expertise but regards the contention of the Trustee that the signatures were very similar and therefore accepting it was the signature of the Complainant was reasonable particularly when taken in conjunction with the other details of the payment. The Complainant submits that his wife had control of the bank account and that he did not see any of the transactions. This explains why the Complainant did not become aware of the payment from the Fund until 2004. Similar to the arrangement he had with his wife in respect to the letterbox the Complainant chose to allow his wife to have total control of the bank account. The Tribunal does not believe that such an arrangement can be construed as shifting the liability to any party that pays money into that account for the Complainant if the Complainant's wife applies the money in a manner subsequently not approved of by the Complainant. It is, in the view of the Tribunal, fair and reasonable to regard the Trustee as having made the payment to the Complainant. These arrangements were such that they caused the superannuation benefit to be applied in a manner not requested by the Complainant. However the Trustee quite reasonably believed that it was at all times dealing with the Complainant, that the Complainant signed the withdrawal form and that it made the payment to the Complainant. Therefore the Tribunal it satisfied that the decision of the Trustee not to re-instate the Complainant's account in the Fund was fair and reasonable in the circumstances in its operation in relation to the Complainant. 5 Putting to one side their form, the alleged questions of law in (2) of the notice of amended appeal, even if reformulated as questions, would not be questions of law with the possible exception of (2)(b); they would be questions of fact or, at best, mixed questions of fact and law. The issue was not raised below and in those circumstances the Tribunal was not required to deal with it by specific reference to the trust deed in its reasons. 2. The clause itself is permissive rather than mandatory so that the failure of the Trustee to require a claimant for payment of a benefit to comply with the terms of Clause 10.1(b) before payment would not amount to a failure on the part of the Trustee to comply with the provisions of the trust deed. Nevertheless, I indicated to the parties that I would be prepared to hear them on the issue of whether, if the applicant should apply for leave to further amend his notice of amended appeal to raise this issue, leave should be granted. For this purpose, I adjourned the proceedings to enable the parties to consider and address the issue and to file written submissions in support of their respective positions. 8 At the adjourned hearing, the applicant sought leave to further amend his notice of amended appeal to enable him to raise the reg 6.22 issue. 9 Not surprisingly, the Trustee submitted that the applicant should not be granted leave. Indeed, the Trustee submitted that even if there had been a breach of reg 6.22, that would not necessarily be a matter that the Tribunal was bound to determine (or ought to determine) having regard to the particular limited nature of its enquiry and the peculiar circumstances of this case. On the other hand, underlying my concern was that if, in the circumstances of this case, reg 6.22 prohibited the Trustee from doing what it did, that is, paying the applicant's benefits into a joint bank account in the names of himself and his wife, then why, on any view, would the decision of the Trustee not to reinstate the applicant's account not be one which raised the issue of whether it was 'unfair and unreasonable': Superannuation (Resolution of Complaints) Act 1993 (Cth), subs 14(2). So understood, review of that latter decision would be within the jurisdiction of the Tribunal: cf., Asgard Capital Management Ltd v Maher [2003] FCAFC 156 ; (2003) 131 FCR 196 at [5] . 10 In Asgard Capital Management Ltd v Maher a Full Court of this Court was called upon to construe the nature and scope of the obligation imposed on a trustee by reg 6.22 in the context of the facts which came before it. Those facts can be shortly stated. The respondent was a beneficiary of the Asgard Independence Plan Superannuation fund which had been established to provide retirement benefits to its members. As at late 1999, the respondent's investment in the fund was $280,000. He instructed his financial adviser to deal with this investment in the following way: $30,000 was to be credited to a joint bank account in the name of the respondent and his wife; $5,000 was to be applied to the purchase of shares in Coles Myer; the balance of $245,000 was to be transferred to a new investment with the trustee. To enable the adviser to carry out this instruction, the respondent signed a blank payment request form (which covered three pages) directed to the trustee. He gave the form to his adviser and left it to him to complete the form in the required manner. It was this act which put the adviser in the position where he could misappropriate the money. He completed the form so that the trustee was directed to pay the whole of the respondent's entitlement into a bank account maintained by the adviser. As directed, the trustee deposited $280,000 into the nominated account. The adviser then transferred $30,000 to his client's bank account. He also purchased $5,000 worth of Coles Myer shares on his client's behalf. He kept the rest of the money (together with $50.65 interest) for himself. 11 Following the discovery of the theft, the respondent lodged a complaint with the trustee alleging that by paying his superannuation entitlement to his adviser, the trustee had acted negligently or illegally. He demanded that the trustee make good his loss. The trustee rejected the complaint. The respondent took his case to the Superannuation Complaints Tribunal. The Tribunal determined to set aside the trustee's decision 'on the grounds that it was not fair and reasonable in its operation in relation to the [respondent] in the circumstances'. In substituting its own decision for that of the trustee, the Tribunal decided that the respondent should be paid a superannuation benefit of $245,050.46. The trustee then brought an 'appeal' on a question of law: see s 46 of the Superannuation (Resolution of Complaints) Act 1993 (Cth). The question of law that arose was the meaning of the phrase 'must not be cashed in favour of a person other than the member' in reg 6.22(1). The judge who heard the appeal affirmed the decision of the Tribunal. The question raised by this appeal is whether this is the correct construction of reg 6.22. When the time fixed by the terms of a trust for the distribution of trust property has arrived, it is the duty of the trustee to convey title to or distribute (that is give possession of) the trust property to the beneficiary. Instead of taking the title himself, the beneficiary may require the trustee to convey or distribute the trust property to a third party. The reason why the beneficiary has the right to give such a direction is surely obvious and probably need not be stated. Nevertheless, so that there is no doubt about it, the reason is that the beneficiary is in substance the owner of the property and can deal with it as he likes: Wilson v Wilson (1950) 51 SR (NSW) 91 at 94; Stephenson v Barclays Bank Trust Co Ltd [1975] 1 WLR 882 at 889. Does reg 6.22 impose an obligation upon the trustee to ignore a direction given by a beneficiary to pay an accrued benefit (that is, a benefit in which the beneficiary has an absolute interest) to the beneficiary's authorised agent or to any other person nominated by the beneficiary? It would, to say the least, be a most inconvenient result if this were the proper construction of reg 6.22. Take, for example, the following situation which, in one form or another, is often likely to occur. A beneficiary has purchased a property. He instructs his solicitor to attend settlement to hand over the purchase price in exchange for the title deeds. The beneficiary wishes to fund the purchase (in whole or in part) out of his superannuation benefit. He directs the trustee to pay the benefit to his solicitor so that the solicitor can attend the settlement. According to the respondent's construction of reg 6.22, if the trustee carries out this instruction it would be in breach of trust. All the trustee is permitted to do is to pay the benefit to the beneficiary and leave it to the beneficiary to arrange for payment to his solicitor. If the trustee were to make that payment, the trustee would, in our view, be cashing the member's benefit "in favour of" the beneficiary. Likewise, if the trustee were to pay the benefit to an agent who was specifically authorised to receive the benefit on the member's behalf. That payment would be a payment made "in favour of" the member. The respondent's contention that the phrase "must not be cashed in favour of a person other than the member" means that a benefit must not be paid to any person other than the beneficiary personally, in effect, amounts to a redrafting of reg 6.22 and not to the proper construction of it. 16 In the circumstances of the Tribunal's finding that the applicant was responsible for the arrangements he had with his wife in respect of the letterbox at their residence and their joint bank account and the Tribunal's finding that the Trustee quite reasonably believed that it was at all times dealing with the applicant and that the applicant had signed the withdrawal form (including the signature verification process), in my view, the Tribunal was entitled to be satisfied that the decision of the Trustee not to reinstate the applicant's account in the fund was fair and reasonable in the circumstances in its operation in relation to the applicant. 17 In the circumstances, there would be no utility in granting the applicant leave to further amend his notice of amended appeal to raise the reg 6.22 issue; the appeal would, for the reasons given, inevitably fail. I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds. | review of determination of superannuation complaints tribunal whether unfair and unreasonable to not reinstate account according to superannuation (resolution of complaints) act 1993 (cth), subs 14(2) mixed question of fact and law appeal on question not raised below permissive clause in trust deed whether account cashed in favour of member according to superannuation industry (supervision) regulations 1994 , reg 6.22 administrative law |
The application was filed on 8 October 1997 with the National Native Title Tribunal ('the NNTT') by Dorothy and Phillip Lawson ('the Lawsons') on behalf of the 'Pooncarie' Barkandji (Paakantyi) people ('the Claim Group'). The progress of the application has been hindered by a number of disputes within the Claim Group including, inter alia, disputes about which members of the Claim Group should represent it as the applicant in this proceeding and about the area that should be the subject of the claim. 2 On 13 July 2001, I rejected an application made under s 66B to remove the Lawsons as the applicant: Johnson, in the matter of Lawson v Lawson [2001] FCA 894. Although I accepted that the Lawsons had lost the confidence of some important members of the Claim Group I was not satisfied that the evidence was sufficient to show that the Claim Group, by appropriate decision-making processes, had revoked their authority to represent it or had authorised other members of the Claim Group to replace them. 3 Following unsuccessful attempts to mediate the issues within the Claim Group, a further application to replace the Lawsons was successful. On 9 December 2002, I ordered that Ray Lawson, Noel Johnson, Mary-Ann Marton, Jennifer Whyman and Patricia Johnson replace the Lawsons as the applicant: Lawson on behalf of the 'Pooncarie' Barkandji (Paakantyi) People v Minister for Land and Water Conservation for the State of New South Wales [2002] FCA 1517 (' Lawson '). On 29 September 2004, the application was amended to add William Bates, Maureen O'Donnell and Cyril Hunter to the group comprising the applicant. These eight individuals presently comprise the applicant in this proceeding. 4 On 23 December 2004, the NNTT refused to accept the amended application for registration. Subsequently, a dispute about the future conduct of the proceeding arose between Ray Lawson and Noel Johnson and the other members of the applicant group. In essence, Mr Lawson and Mr Johnson believe that the area subject to the claim should be split between two claims, those of the people they regard as 'pure' Barkandji people and those of the other members of the Claim Group. By this notice of motion, an amended version of which was filed in Court on 13 December 2005, members of the Claim Group seek an order under s 66B of the Native Title Act 1993 (Cth) ('the NTA') replacing the current applicant on grounds that the current applicant is no longer authorised by the claim group to make the application and to deal with matters arising in relation to it. In effect the motion seeks: (a) to remove Mr Lawson and Mr Johnson from the applicant group as well as a third member, Mrs Patricia Johnson; and (b) to add two new members, Mr Murray Butcher and Mr Derek Hardman. Mr Lawson and Mr Johnson oppose the application to remove them; Mrs Johnson has not appeared or made any submissions however it is alleged that, because of her ill health, she no longer wishes to be part of the group that comprises the applicant or to be involved in the management of the proceeding. At the directions hearing on 5 December, Mr Lawson and Mr Johnson appeared by telephone to press this application as did Mr Dengate, who currently has leave to appear in a related compensation matter. 7 In support of their application for leave to be represented by a non-lawyer, Messrs Lawson and Johnson contended that Mr Dengate understood their position and was willing to assist them. It was evident from their statements that they have a degree of confidence in Mr Dengate. For his part, Mr Dengate referred to the fact that neither Mr Lawson nor Mr Johnson could read or write sufficiently to cope with representing themselves and that without his assistance they would have no representation. He submitted that he has experience in these matters and is in a position to assist the Court. 8 Section 85 of the NTA provides that a 'party may appear in person or may be represented by a barrister, a solicitor or, with the leave of the Federal Court, another person'. Although Messrs Lawson and Johnson are members of the applicant group they are not, as individuals, parties to this proceeding: see s 61(2) of the NTA. Nevertheless they are, effectively, the contradictors to the present motion. I am satisfied, therefore, that under the Court's power to do that which is incidental or necessary to the exercise of the powers conferred on it, in this case by s 66B of the NTA, I have jurisdiction to entertain the application for leave for Mr Dengate to appear. In Melaleuca of Australia & New Zealand Pty Ltd v Duck [2005] FCA 1481 , Bennett J helpfully summarised the Court's 'inherent' power in this regard at [5]-[15]. While I would prefer to take the approach advocated in Parsons v Martin (1984) 5 FCR 235 at 241 and refer to this power as an 'incidental and necessary power of a statutory court' rather than as 'inherent', I respectfully accept her Honour's statement of the generally applicable principles. 9 In particular, I see no reason why the Court's incidental power to grant a person leave to appear by a non-lawyer and the power to do so under s 85 of the NTA should not involve similar considerations, particularly in the current context. Perhaps Dolly Walker thinks that leave is granted as a matter of course, just for the asking. This is not so and for good reason. Solicitors and barristers are qualified by education and training to represent parties and are subject to professional and curial disciplines and responsibilities. The requirement of leave is imposed for the reason that the Court must be satisfied that it is in the interests of the administration of justice in all the circumstances that a party be represented by a person who is not a solicitor or barrister. 10 In opposing the application for leave for Mr Dengate to appear, Ms Phillips, who appeared for New South Wales Native Title Services ('NTS'), pointed out that the application for leave (which was signed by Mr Dengate) sought to have him represent Mr Lawson and Mr Johnson not only in respect of the present motion but also in the substantive proceedings. The notion that there is any scope for members of the applicant group to be separately represented fundamentally misconceives the role of those comprising an applicant in native title proceedings. With the greatest respect to Mr Dengate, and despite his genuine commitment to his clients, I am convinced that he has neither the discipline nor the understanding to assist them or the Court. I am confirmed in this view by my previous experience of Mr Dengate as an advocate; see my comments in Johnson at [14]-[16] and Johnson on behalf of the Barkandji (Paakantyi) People v Minister for Land and Water Conservation for the State of New South Wales [2003] FCA 1411 at [4] - [6] . For these reasons I declined to grant leave for Mr Dengate to appear. 12 It is also relevant to note that Messrs Lawson and Johnson have some experience in native title proceedings in this Court and, as it transpired, their evidence and submissions at the motion hearing were cogent, relevant and explained the dispute between the parties clearly. Mr Dengate contended that there had been delays in the service of the documents relating to the motion. He stated that Mr Lawson had not been served with all the documents until 21 November 2005. Consequently, he argued that it was not appropriate to hear the motion on 13 December 2005. 14 Ms Phillips conceded that there was some delay in formally serving all the material on Messrs Lawson and Johnson. However, she contended, and the evidence supports her contention, that they had been on notice of the motion seeking to replace them as part of the group comprising the applicant since early October. In particular, she referred to correspondence dated 7 October 2005 from NTS to both Mr Lawson and Mr Johnson advising them that the 1 October meeting had resolved to invite them to resign from the applicant group and had authorised other members of the Claim Group to replace them. It is plain that this correspondence was received as by letter dated 11 October 2005 a solicitor wrote on their behalf to NTS indicating that they did not intend to resign. 15 Following this refusal, NTS moved to replace them under s 66B of the NTA. Neither Mr Lawson nor Mr Johnson attended the directions hearing of 14 October 2005 at which the motion seeking orders under s 66B was filed and a timetable put in place. In these circumstances I was satisfied that the hearing date of 13 December 2005 should be retained. 16 It is also relevant to note that following the above discussions with Messrs Lawson, Johnson and Dengate, all of whom appeared by telephone from separate locations on 5 December, the Court was forced to terminate the telephone conference with these participants. Despite assurances that he would remain quiet, Mr Dengate (and other unidentified persons) continued to speak so close to his phone that it was impossible to continue the directions with this disturbance. While the transcript of the proceeding does not fully capture the resulting confusion, notwithstanding a short adjournment to remedy the problem, it was ultimately necessary to have the Court staff terminate the telephone conference. If an application under s 66B is to succeed it is necessary that the evidence clearly demonstrate that the relevant persons no longer have that authority and, for this reason, it was necessary to make careful preparation for the 1 October meeting. 18 In an affidavit affirmed on 8 November 2005, Mishka Holt, a solicitor with NTS, gave evidence of the preparations for the 1 October meeting. On 13 and 14 September, letters were sent to all members of the Claim Group for whom NTS had postal addresses. The letter stated that the meeting was to discuss important matters in respect of the claim and to make decisions about its future conduct. The letter set out the proposed agenda and attached a map of the claim area. The letter also provided logistical information, including forms in respect of travel assistance, the provision of accommodation and a bus schedule. Ms Holt's affidavit provides that NTS paid accommodation and breakfast costs of those attending who did not reside in Broken Hill; that NTS hired buses for persons travelling to Broken Hill from Dareton, Mildura and Wilcannia; that NTS reimbursed persons for their fuel costs in relation to travelling to the meeting; and that NTS provided lunch and refreshments and an allowance for an evening meal. 19 Ms Holt also gave evidence that on 12 September she wrote to all Local Aboriginal Land Councils within the claim area for the information of their members advising them of the 1 October meeting. In addition, NTS placed advertisements in a number of local newspapers advising of the 1 October meeting. These were published in the Mildura Midweek , the Barrier Daily Truth , the Koori Mail , and the Wilcannia News . In addition to numerous phone calls with members of the Claim Group, Ms Holt deposed that she had several telephone conversations with Mr Lawson, Mr Johnson and Ms Shelia Kirby, Mr Johnson's wife. She gave evidence that two days prior to the meeting, Mr Lawson informed her that he would not be attending. 20 According to the attendance list of the meeting, 58 members of the Claim Group attended the meeting. Mr Lawson and Mr Johnson did not attend the meeting, although the evidence discloses that they were invited and were aware the meeting was to take place and neither Mr Lawson nor Mr Johnson sought to deny this. They show that Ms Holt and Dr Lum summarised the current status of the claim for the attendees. In particular, Dr Lum discussed the different groups that together comprise the Claim Group and the meaning of the term 'Barkandji'. He explained that the term can be used to describe a small sub-group of the Claim Group, the members of which are called Barkandji and who speak the Barkandji language; Mr Lawson and Mr Johnson are members of this sub-group. Dr Lum also explained that the other sub-groups of the Claim Group all speak various dialects of the Barkandji language. Because the area over which the claimant application is made includes the country from which these other sub-groups come, all the subgroups must be included in the Claim Group. 22 The minutes record that the meeting discussed decision-making methods in the context of the requirements of s 251B of the NTA. The meeting resolved that those present were sufficiently representative of the Claim Group. This is consistent with evidence given by Dr Lum on this point. In addition, those present at the meeting confirmed that when authorising amendments to the claim and dealing with matters arising in relation to the claim there is no particular process of decision-making under traditional laws and customs that must be complied with by the Claim Group. It was resolved that the Claim Group was united and to continue with the current structure of the claim. Further, the meeting resolved to invite those members of the applicant group who disagree with a united claim to resign and authorised Murray Butcher and Derek Hardman to replace them as members of the applicant group. If the invitation was declined, the meeting decided that those who had been authorised to become the applicant must take the necessary steps to replace the present applicant. The meeting then authorised the so-termed 'new applicant', in which Mr Butcher and Mr Hardman replaced Mr Lawson and Mr Johnson, to make the native title claim and to deal with matters arising in relation to it. The meeting also required the 'new applicant' to do all things necessary to replace the present applicant. 24 While Mr Russo and Ms Mann excused themselves from the meeting during the making of these resolutions because of their roles with the NNTT, they returned at the end of the meeting and verified the resolutions by reading them to the meeting and receiving no dissent. In essence, their evidence disclosed their view that the term 'Barkandji' referred to a narrower group than the whole Claim Group: see [22] above. They believed that this narrower group, of which they were members, ought to make a separate native title claim over a smaller area of land, mainly in the southern part of the claim area, than that presently claimed. This leads to the somewhat awkward situation where the term 'applicant' is applied to a group of separately named individuals: see Noble v Murgha [2005] FCAFC 211 at [6] . There is a claimant application. 2. Each applicant for an order under s 66B is a member of the native title group. 3. The person to be replaced is no longer authorised by the claim group to make the application and to deal with matters arising in relation to it. 4. Alternatively, the person to be replaced has exceeded the authority given to him or her by the claim group. 5. The persons making the application under s 66B are authorised by the claim group to make the application and to deal with matters arising under it. 29 It is pertinent to note, however, that the Court retains a discretion not to make the orders sought under s 66B of the NTA: see Ward v Northern Territory [2002] FCA 171 (' Ward ') at [16] and Daniel at [18]. As such, the issues in the present context revolve around whether the Claim Group no longer authorises Messrs Lawson and Johnson to make the application and to deal with matters arising in relation to it and whether those making the application under s 66B of the NTA are so authorised by the Claim Group in their stead. 31 On the basis of the evidence set out above at [19]-[20], I am satisfied that all reasonable steps were taken to advise members of the Claim Group of the 1 October meeting. In addition, adequate assistance was provided to permit members of the Claim Group to attend where they did not reside in Broken Hill. While neither Mr Lawson nor Mr Johnson attended the 1 October meeting, I am satisfied that they were aware it was taking place and voluntarily chose not to attend. As the resolutions made at the meeting and the expert evidence of Dr Lum demonstrate, those attending the meeting were representative of the Claim Group. In my view, none of the concerns expressed by O'Loughlin J in Ward at [24] are applicable in this context. 32 Further, I am satisfied as to the accuracy of the minutes of the meeting. In particular, I accept, on the basis of the independent verification, that those present made the resolutions recorded: see [25] above. The evidence reveals that the meeting resolved that there was not a process of decision-making under traditional laws and customs for decisions of this kind . This is supported by Dr Lum's evidence that in his opinion the Claim Group's traditional decision-making processes do not apply to the current circumstances. Those present at the meeting therefore adopted the decision-making process set out above at [23], by which they decided to revoke the authorisation of the applicant as presently constituted and authorised a new group to form the applicant in this proceeding. As such, I am satisfied that the requirements of s 66B(1) of the NTA are met. 33 For these reasons, I am satisfied that the orders sought, insofar as they relate to the removal of Mr Lawson and Mr Johnson from the applicant group and the inclusion of Mr Murray Butcher and Mr Derek Hardman, should be made. Although the issue of Ms Johnson's continuing role was discussed at the 1 October meeting, there was no resolution to remove her from the applicant group. I am, however, satisfied by the evidence before me that Ms Johnson has clearly indicated that she does not wish to continue as a member of the applicant group and for this reason it is appropriate to make the orders sought. 35 The evidence to which I refer is to be found in the affidavits of Philippe Savidis and Mishka Holt, solicitors with NTS, affirmed respectively on 7 and 14 November 2005. Both solicitors attest to their repeated attempts to discuss the claim with Ms Johnson and her repeated assertions that, owing to illness, she is unable to carry out her responsibilities and no longer wishes to remain a member of the group comprising the applicant. Ms Johnson has not provided an affidavit in accordance with s 64(5) of the NTA despite requests from NTS and on this basis I am satisfied that her name should not be included as a person who comprises the applicant in this proceeding. However, it is pertinent to note that in making these orders the Court is not adversely reflecting in any way on the conduct of Mr Lawson and Mr Johnson. There clearly has been a deeply held disagreement within the Claim Group and this has been resolved in accordance with the provisions of the NTA. As was discussed at the 1 October meeting, an order made under s 66B(2) of the NTA does not remove Mr Lawson and Mr Johnson from the Claim Group, nor does it affect their standing according to traditional law and custom. As members of the Claim Group both will continue to have the opportunity to participate in discussions as to the future conduct of the native title claim and it is to be hoped that they will avail themselves of the opportunity to do so. | application to replace applicant in claimant application under s 66b of the native title act 1993 (cth) whether applicant no longer authorised by native title claim group whether persons bringing application authorised by claim group to make the application and to deal with matters arising under it native title |
2 Pursuant to these orders I have received written submissions from the plaintiffs, T & G Welding Pty Ltd ('T & G Welding') (a supporting creditor), ASIC, and Saxbys. 5 I will further order that the plaintiffs be entitled in respect of their costs to be paid out of the security provided pursuant to orders of the Court made on 29 May 2007. 6 In view of the history of the application made on 3 July 2007 and the events on 6 July 2007, I propose to make no specific orders as to costs in relation to the hearings on 3 July 2007 and 6 July 2007. Those costs will be part of the orders I already propose to make in relation to the proceeding generally. I observed that reserve costs are dealt with in the Federal Court Rules (see O 62 r 15). However, I am not satisfied that it is appropriate in the context of the applications made on behalf of APM or in the conduct of the proceedings generally, that I should make a cost order directly against Mr Fisher. I do not consider that Mr Fisher's own conduct has been demonstrated to be so unreasonable, or even that if the application against Saxbys was obviously without merit, that a costs order against Mr Fisher would be appropriate. I appreciate that Mr Fisher (as the director of APM) was granted leave to appeal the decision of Registrar Musset, but the hearing was to be treated de novo to consider the solvency of APM. 10 Further, I am not satisfied that the interests of justice require an order to be made against Mr Fisher where costs can be accommodated in accordance with the statutory regime or as part of the costs in the winding up --- see generally Knight v FP Special Assets Ltd [1992] HCA 28 ; (1992) 174 CLR 178 and Symphony Group Plc v Hodgson [1994] QB 179 at 191-192 per Balcombe LJ. 11 I consider that the plaintiffs (and, for that matter, those supporting the plaintiffs' application), having brought their application on the basis of a failure to comply with a statutory demand, should be reimbursed in accordance with s 466(2) of the Corporations Act (or as part of the costs in the winding up). 12 I do, however, consider that there was a considerable loss of time, inconvenience to the parties and the Court, and a wilful disregard to established law in the attempts to re-open the case (other than on the limited basis permitted) and in the application for a restraining order against Saxbys --- see generally Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd (1988) 81 ALR 397 at 401; Ugly Tribe Company Pty Ltd v Sikola [2001] VSC 189 ; Australian Guarantee Corp Ltd v De Jager [1984] VR 483 at 502. 13 Whilst I do not consider it appropriate to order Mr Fisher to pay these costs, the Court is warranted in making orders to prevent as far as possible the plaintiffs from being out of pocket. I propose to order, therefore, that in relation to the hearings after the hearing of 11 July 2007, the plaintiffs' costs be taxed on an indemnity basis and reimbursed in accordance with s 466(2) of the Corporations Act . 15 For the reasons given above in relation to the submission of the plaintiffs that Mr Fisher should pay costs, I reject the similar contention put on behalf of T & G Welding. 16 However, I accept that T & G Welding, as a supporting creditor, should be entitled to its costs in the winding up. 17 In addition to making submissions similar to the plaintiffs' about the events which occurred after the hearing on 11 July 2007, T & G Welding also submitted that because of the conduct of APM during the proceedings generally (particularly its tardiness in filing material as ordered by the Court and its abandonment of certain evidence), the costs to be ordered in favour of T & G Welding should be ordered on an indemnity or solicitor and own client basis. 18 I am prepared to do so in relation to the costs of and in connection with the hearings after the hearing on 11 July 2007 for the reasons given above. However, I do not consider that it is appropriate to otherwise order indemnity costs or costs on a solicitor and own client basis, despite the series of events accurately described in the written submissions of T & G Welding. 19 In view of the nature of APM, its business activities, its involvement in other litigation and the state of its financial records, I cannot be satisfied without more that APM had involved itself in this part of the proceedings in sufficiently unmeritorious, deliberately high-handed or otherwise improper conduct so to as warrant the order sought by T & G Welding. ASIC intervened in this proceeding pursuant to s 1330 of the Corporations Act . A costs order could be granted in its favour should the Court so exercise its discretion. 21 In normal circumstances ASIC, in protecting the public interest, may not obtain a costs order in its favour even if its contentions are accepted, or, for that matter, suffer an adverse costs order against it in the event that its contentions are not accepted by the Court. 22 However, in this proceeding, ASIC appropriately played a significant part. ASIC had a special interest in supporting the order sought in view of other proceedings before the Court, heard concurrently, where it also sought as final relief the winding up of APM. 23 I propose to order that ASIC's costs of the proceeding be costs in the winding up and be taxed on a party/party basis. 24 ASIC also seeks costs of its notice of motion dated 28 September 2007 notwithstanding that it was dismissed on 5 October 2007. 25 ASIC, through its notice of motion, was properly seeking to inform the Court of relevant matters which APM had failed to do in a timely and appropriate manner. Whilst the motion was dismissed, the substantive matters raised by ASIC were accepted by the Court. By making the general order as to costs as proposed above in favour of ASIC, without excluding the notice of motion dated 28 September 2007, ASIC will be entitled to its costs of the proceedings generally (including the notice of motion dated 28 September 2007). 27 For the reasons given above, I do not propose to make any orders against Mr Fisher. However Saxbys are entitled to costs in the winding up, and the question is whether the costs should be on an indemnity (or solicitor and own client basis) or on a party/party basis. 28 In my view, the application to restrain Saxbys was misconceived and obviously without merit, as was the subpoena to Saxbys seeking various documents in support of that application. Saxbys put APM on notice that such application and subpoena should be withdrawn to avoid adverse cost consequences for APM. 29 I do not accept on the current material that the application to restrain Saxbys was necessarily to intimidate or harass Saxbys or its clients, although I do accept that there was no basis to support the legitimacy of such motion to disqualify. The allegations made against Saxbys were unsuccessful. In my view they were clearly unmeritorious, and to the extent possible, Saxbys should not be out of pocket --- see generally Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd (1988) 81 ALR 397 at 401; Ugly Tribe Company Pty Ltd v Sikola [2001] VSC 189 ; Australian Guarantee Corp Ltd v De Jager [1984] VR 483 at 502. 30 I propose to order that Saxbys costs be costs in the winding up and be taxed on an indemnity basis. No submissions were received in respect of costs by those who were not professionally represented before me and I do not propose to make any order in relation to their possible disbursements. | costs orders against a non-party discretion to award indemnity costs entitlement of asic as an intervener to costs orders costs |
A delegate of the first respondent refused to grant a protection visa ('the first delegate's decision'). The visa application before the first delegate referred to "my statutory declaration" but did not contain any such statutory declaration or any information relating to the appellant's claims for protection. 2 The appellant then lodged an application to the Refugee Review Tribunal ('the Tribunal') for review of the first delegate's decision on 21 November 1997 ('the first Tribunal application'). On 6 October 1999, the Tribunal ('the first Tribunal') wrote to the appellant informing him that it was not prepared to make a decision on the information that it had. It invited him to a hearing and invited him, inter alia, to submit any new documents or written arguments. On 9 November 1999, the appellant submitted a statutory declaration made on 9 November 1999 and other material to the first Tribunal. The appellant attended the hearing before the first Tribunal. On 7 December 1999, the Tribunal upheld the first delegate's decision ('the first Tribunal decision'). One of its findings was that it was not satisfied that the appellant ' has ever been an active politically-savvy member of any political party, not the BNP nor any other '. I refer to the first Tribunal's findings in order to understand the findings the subject of this appeal. 3 On 3 July 2001 the appellant lodged a second application for a protection visa on the basis that the first application was invalid. The second application included a copy of the statutory declaration that had earlier been forwarded to the first Tribunal. The second application also included the statement: ' I trust all my supporting documents which I have provided the RRT is now available to the Onshore Refugee. However if the department wants them again to forward I will do so as soon as I am advised '. On 31 August 2001 a delegate of the first respondent refused to grant a protection visa to the appellant ('the second delegate's decision'). 4 On 18 September 2001 the appellant applied to the Tribunal ('the second Tribunal') for a review of the second delegate's decision. On 15 April 2002 the second Tribunal affirmed the second delegate's decision ('the second Tribunal decision'). It held that it may have regard to, and take to be correct, any decision that the first Tribunal made about or because of that information, and did so. The second Tribunal accepted the findings of the first Tribunal ' that the [appellant] had not been a politically active member of any political party, not the BNP or any other, and that the [first] Tribunal was not satisfied that the [appellant] had a well founded fear of persecution in the foreseeable future if he returned to Bangladesh '. 6 The second Tribunal continued to consider the situation, in the alternative, if it were to accept the appellant's claims of political activism. The second Tribunal noted that the appellant's claimed political party, the BNP, had been elected to government in Bangladesh and determined that the appellant could safely return to his country. The second Tribunal also found that, if it accepted the appellant's claim that he faced false politically motivated charges on his return, he nevertheless would be able to access adequate state protection and that there would be no real chance of treatment amounting to persecution. The second Tribunal also rejected the appellant's claim that he could not return to Bangladesh because his mother was contemplating moving to Sweden and there would be no one to protect him. Even if this was accepted as factually correct, the Tribunal said that such a claim was not Convention based. 7 On 29 July 2004 the appellant lodged an application in the Federal Magistrates Court to review the second Tribunal decision. On 29 April 2005, the Federal Magistrate dismissed the application. His Honour's decision was based upon the "alternative reasons" for the second Tribunal decision. The transcript reproduced in paragraph 33 above, indicated that the Tribunal member raised this issue with the [appellant] . It could be argued that the change in the political fortunes of the various parties leading to the change of controlling power in the Parliament in October 2001 would be broad public knowledge to anyone associated with Bangladesh and particularly a person who claimed a high political profile. However, the Tribunal member did accord the [appellant] procedural fairness by raising the issue of the consequences that flow from such a change that would result in a change of circumstances of the [appellant] himself. There was no need to examine the decision making process of the second Tribunal member in reaching this decision as this could encroach on the merits of the decision. Importantly, the decision was not dependent upon the first Tribunal's decision or the material submitted to that the first Tribunal and subsequently re-submitted to the second Tribunal. This decision was based on information that stood alone and was not influenced by prior determinations concerning the [appellant] and was, in fact, as the respondent Counsel suggested a simple and complete answer to the Tribunal's decision. • As the first application was invalid, the first Tribunal had no authority to make any decision. Therefore the first Tribunal's purported decision cannot be said to have "determined" an "RRT-reviewable decision" within the meaning of s 416 of the Act. His submission is that, if the second Tribunal was not entitled to rely on s 416 , the second Tribunal decision is 'infected' with procedural unfairness and the whole of that decision is vitiated. • If the second Tribunal was not entitled to rely on s 416 , is the alternative basis for the decision sufficient to avoid the consequence that the whole decision fails for jurisdictional error? • If the second Tribunal was not entitled to rely on s 416 , does there remain a discretion not to refer the matter back to the Tribunal and, if so, how should that discretion be exercised? 16 The RRT-reviewable decision is the first delegate's decision to refuse to grant a protection visa. Mr Gormly submits that s 416 does not apply to the first Tribunal decision because that decision was made in respect of an invalid application and, accordingly, the first Tribunal had no jurisdiction to review or determine the first delegate's decision in respect of that invalid application. The invalidity arises, it is submitted, from the fact that the first application did not substantially comply with the requirements, made under the Act and Regulations, of lodging a completed application in the prescribed form. Mr Gormly says that this invalidity was not cured by the appellant sending the promised statutory declaration and material relating to his claims to the first Tribunal. He refers to s 47(3) which provides that the Minister is not to consider an application that is not a valid application and submits that the invalidity is not cured by s 69(1). He relies upon the decision in Minister for Immigration and Multicultural Affairs v Li [2000] FCA 1456 ; (2000) 103 FCR 486. 17 Mr Johnson who appears for the first respondent submits that, based upon the reasoning in Yilmaz v Minister for Immigration & Multicultural Affairs [2000] FCA 906 ; (2000) 100 FCR 495, Thayananthan v Minister for Immigration & Multicultural Affairs [2001] FCA 831 ; (2001) 113 FCR 297 and Zubair v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 248 ; (2004) 139 FCR 344, the first delegate's decision was not invalid and that an RRT-reviewable decision had been determined by the first Tribunal. 18 In Yilmaz, the Full Court (Spender and Gyles JJ, Marshall J dissenting) the promised statement was not supplied prior to the decision of the delegate; it was submitted to the Department after that decision. The Court was concerned with the power of the Tribunal to determine an application for a protection visa which was, to use the expression of Spender J, "inchoate" at the time that the delegate had determined it but complete at the time that the application was before the Tribunal. The visa application had stated that the grounds were contained in a "statement to follow. " The promised statement was not supplied prior to the decision of the Minister's delegate but was supplied to the Department after the delegate's decision. 19 Gyles J (with whom Spender J agreed, Marshall J dissenting) referred to decisions of the Court as to whether material received by the Tribunal would cure deficiencies in the application. First instance authority differed as to whether the application was complete for the purposes of the Act in those circumstances. In each of those cases the view was taken that the decision of the delegate was a decision within the meaning of ss 411 and 412 of the Act, that is it was an RRT-reviewable decision. The basis for that conclusion was either the application of s 69 of the Act or the application of the principle in Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd (1979) 41 FLR 338. The latter principle was stated as ' an administrative decision which is legally ineffective or void may be susceptible to appeal '. As put by Gyles J at [79], each of those judges (Finn, Heerey and Lindgren JJ) had held that an invalid decision is nonetheless a decision for the purposes of ss 411 and 412 . However, Heerey J and Lindgren J had each held that the Tribunal, in reviewing the decision, was limited to holding that it was invalid. Finn J had held that the Tribunal was entitled to exercise all the powers and discretions conferred by the Act; the Tribunal was entitled to consider the application as it stood at the time it was completed or perfected before it. 20 Gyles J reviewed the Act and the authorities and concluded at [88] that the Tribunal had jurisdiction to review the "invalid" delegate's decision both by reason of the Lawlor principle and by reason of s 69 of the Act. That is, the decision under review was an RRT-reviewable decision. His Honour's reasoning then was, at [92], that once the jurisdiction of the review body (here the Tribunal) is enlivened, the decision it makes supersedes the original decision and the invalidity of the original decision is irrelevant. 21 Gyles J held at [93] that the application could be completed later and that there was no reason why this could not take place in the course of review by the Tribunal. Further, his Honour specifically endorsed that view of Finn J in Phanouvong v Minister for Immigration and Multicultural Affairs (1999) 60 ALD 438. In Phanouvong the missing information to complete the application for a visa was submitted not to the Department but to the Tribunal. 22 In Li the Full Court affirmed Yilmaz to the extent that, where the additional information was sent to the Department, the application was complete once the promised information was supplied and that if submitted prior to the decision of the delegate, the application, thus completed, was a valid application. In Li the additional information had been received by the Tribunal rather than by the Department. The Court in Li at [81] distinguished Yilmaz on the basis that Yilmaz decided that the Tribunal could review, on the merits, a decision of the delegate where a valid application for a visa had been lodged, albeit after the date of the delegate's decision. 23 In Li, the Court determined that, where the additional information was sent to the Tribunal and not to the Department, a valid application had not been lodged. The Court said at [82] that the fact that the Act preserves an unauthorised decision by a delegate, so that it is subject to review by the Tribunal, does not confer on the Tribunal greater powers than the delegate could have exercised in relation to an invalid application. The Court, in distinguishing Yilmaz , did not refer to the reasoning of Gyles J in dealing with the circumstances in Phanouvong which were the same as in Li . 24 In Thayananthan , the additional information was supplied to the Department, before the decision was made by the delegate. The Full Court noted the decision in Li but followed the decision in Yilmaz in concluding that the decision of the delegate was valid. The Full Court also noted that the analysis of Spender and Gyles JJ regarding the Lawlor principle and s 69 of the Act was ' equally applicable ' to the circumstances arising in Thayananthan . 25 Yilmaz and the cases which have followed it concerned circumstances where the visa application was valid by the time it was considered by the Tribunal but invalid at the time of consideration by the delegate. Li determined that the application does not become valid if the additional material is submitted to the Tribunal and not to the Department. However, Gyles J in Yilmaz specifically referred to that situation and drew no distinction. The respondent relies also upon Zubair which followed Yilmaz (to which I would add Minister for Immigration and Multicultural and Indigenous Affairs v Ahmed [2005] FCAFC 58 ; (2005) 143 FCR 314 and Uddin v Minister for Immigration & Multicultural & Indigenous Affairs [2005] FCAFC 218). They are authority for the proposition that a decision of the delegate, invalid for its examination of an application that is invalid due to failure to comply with the requirements of the Act, is a decision capable of being reviewed by the Tribunal. The defects are "cured" upon merits review. The Court in Ahmed and in Zubair endorsed the application of the principles in Lawlor . 26 The weight of authority supports the approach of Yilmaz , that is that missing information can complete an invalid application when submitted to the Department or to the Tribunal . A delegate's decision, which involved consideration of an invalid application, is an "RRT-reviewable" decision. 27 Therefore, in this case, the first delegate's decision was an RRT-reviewable decision and that the first Tribunal had jurisdiction to review that decision as the visa application was complete prior to the determination of the first Tribunal. It follows that the first Tribunal decision was a valid decision, which was referred to by the second Tribunal for the purposes of s 416(a). The second Tribunal was entitled by s 416(b) , (c) and (d) not to reconsider any information considered by the first Tribunal and to have regard to and take to be correct the first Tribunal decision. However, that conclusion, if it be wrong, is not determinative of the appeal, as there was an independent basis for the second Tribunal decision. That is, there were separate findings that independently led to a conclusion that the second Tribunal was not satisfied that the appellant is a person to whom Australia has protection obligations. These findings, in turn, were not dependent upon the findings of the first Tribunal or upon the rejection of the appellant's claims by the first Tribunal and adopted by the second Tribunal. Was there procedural unfairness? 30 Mr Gormly contended that there was procedural unfairness in the second Tribunal applying s 416 and relying on the first Tribunal decision. He concedes, however, that if the second Tribunal was entitled to do so, there was no procedural unfairness. I have concluded that the second Tribunal was so entitled. 31 There is, however, another problem in my opinion, although it was not advanced by counsel. It is not suggested that the second Tribunal told the appellant that it may rely on the first Tribunal decision. 32 In my opinion, the second Tribunal should have brought to the attention of the appellant the possibility that the first Tribunal decision would be relevant to its decision. Even if s 424A(1) does not apply to the information in the first Tribunal decision by reason of s 424A(3)(b), it seems to me that it does apply to the first Tribunal decision itself. The first Tribunal decision itself was information for the purposes of the second Tribunal decision. It was part of the reasoning process of the second Tribunal which adopted its conclusions without a reconsideration of the reasons for those conclusions. The first Tribunal decision was part of the reason for the second Tribunal decision. Failure to comply with s 424A(1) would result in jurisdictional error. 33 Procedural fairness required the second Tribunal to inform the appellant of the fact that it was entitled to rely on the first Tribunal decision ( Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591-2). It did not do so. With that knowledge, the appellant may have been able to convince the second Tribunal not to rely on that decision or to come to a different conclusion. 35 Mr Johnson, who appears for the Minister, submits that the alternative basis for the decision stands totally separate and uncontaminated, based as it was on acceptance of the appellant's claims, contrary to the first Tribunal decision. He submits that the denial of the opportunity to make submissions about the first Tribunal decision made no difference to the outcome. The effect of his submissions is that, at the highest, the appellant would have convinced the second Tribunal to come to a different decision to that of the first Tribunal and accepted that, as at the date of the first Tribunal decision, he had a well-founded fear of persecution for a Convention reason. That, in effect, is what the second Tribunal accepted before turning to events that had occurred between the first and second Tribunal hearings. 36 The alternative basis of the second Tribunal decision, which is not challenged, was not founded on any findings of credibility but on the changed political landscape in Bangladesh and the fact that the party of which the appellant claimed to be an active member had been elected to government since the first Tribunal decision. The alternative approach of the second Tribunal was to accept the appellant's claims. The appellant's claims, including his position with the BNP, the current governing political party, provided the basis for the second Tribunal's conclusion that he had no well-founded fear of persecution by reason of false cases that had been brought against him by the Awami League. The claim that the appellant's mother would not be in Bangladesh to protect him did not, even if accepted, support a Convention reason. 37 Mr Gormly has not explained how the alternative basis was itself affected by the denial of procedural fairness. I cannot see how it is. This is not the case where additional evidence and submissions on the first Tribunal decision might have affected the outcome of the second Tribunal hearing. The two bases of the second Tribunal decision were founded on different issues of fact. It can be said that, had the second Tribunal informed the appellant of the possibility of its reliance on the first Tribunal decision and the appellant had made further submissions on the correctness of that decision, it could not possibly have produced a different result ( Stead v State Government Insurance Commission [1986] HCA 54 ; (1986) 161 CLR 141 at 145-6; Re Refugee Review Tribunal; ex parte Aala [2000] HCA 57 ; (2000) 204 CLR 82 at [104] ; Applicant NAFF of 2002 v Minister for Immigration and Multicultural Affairs [2004] HCA 62 ; (2004) 211 ALR 660 at [86] ); Re Minister for Immigration & Multicultural & Indigenous Affairs, ex parte Lam [2003] HCA 6 ; (2003) 214 CLR 1 at [38] , [122], [149] ---[151 ; WALD v Minister for Immigration and Multicultural and Indigenous Affairs (2003) FCR 571 at [58]). 38 Mr Johnson submits that SAAP v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24 ; (2005) 79 ALJR 1009 and Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72 ; (2005) 80 ALJR 228 do not suggest that the whole decision is affected if there is any breach of natural justice, but only that part of the decision to which the denial of procedural fairness relates. The High Court was not in those cases considering a Tribunal decision which was based on two independent grounds. 39 In SZCJH v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1660 , Sackville J at [23] adopted what was said by North J in VBAP of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 965 at [33] , to the effect that SAAP does not stand for the proposition that a breach of s 424A (and therefore denial of procedural fairness) in relation to one ground, where there exists one or more other grounds upon which the decision is not or cannot be impeached, the decision nonetheless falls. 40 In VEAL the High Court rejected the statement in the Tribunal's decision that in reaching its findings it had given no weight to a confidential "dob-in" letter that it had received. The Tribunal's conclusion that it would not have regard to the letter and that the decision could be reached on other bases or information was not sufficient to obviate the requirement that the appellant be given the opportunity to respond to the information. The High Court said at [18]: ' Deciding that it could reach its conclusion on other bases did not discharge the Tribunal's obligation to give the appellant procedural fairness ' and at [19]: ' The relevant inquiry is: what procedures should have been followed? The relevant inquiry is neither what decision should the decision-maker have made, nor what reasons did the decision-maker give for the conclusion reached '. 41 This is not a case where the outcome was determined by one core conclusion reached by the Tribunal. The "infected" conclusion was that, as at the date of the first Tribunal decision, the appellant did not have a well-founded fear of persecution. The second Tribunal based its independent ground on an assumption that the "infected" conclusion was wrong. He submits that, in relying on the first Tribunal decision, the second Tribunal demonstrated bias in the totality of its consideration of the appellant's claims. No such case is made out, either in the decision of the Tribunal or in the transcript which was before me. I reject that submission. 43 His submission that the second Tribunal decision exhibited bias in relying on the first Tribunal decision, which it was entitled to do by reason of s 416, is rejected. 45 Mr Johnson submits that, even if there be reviewable error in reliance on the first Tribunal decision, the decision of the second Tribunal on the lack of well-founded fear as at the date of the second Tribunal hearing means that the conclusion of the second Tribunal could not have been affected. It is submitted that, as a matter of discretion, I should refuse relief. I agree. 46 Mr Gormly submits that if the matter were remitted, by the time the Tribunal hears it, the political situation in Bangladesh could change. 47 The purpose of allowing the Tribunal to take into account developments that might occur or have occurred since the second Tribunal decision is not a proper basis on which to remit the matter ( Minister for Immigration and Multicultural Affairs v Thiyagarajah [2000] HCA 9 ; (2000) 199 CLR 343). 49 There was a denial of natural justice in that the second Tribunal did not inform the appellant of the fact that it may rely upon the first Tribunal decision and give to the appellant the opportunity to address the matters that gave rise to that first decision. 50 The second Tribunal made its decision on the basis that the first Tribunal decision was correct. It also made a decision on the basis that the first Tribunal decision was not correct, that is, on the basis that the appellant's claims as made to the first Tribunal were accepted. 51 The second Tribunal came to the conclusion that Australia did not owe the appellant protection obligations because, at the time of its decision, the appellant did not have a well-founded fear of persecution for a Convention reason on a ground that was completely independent of the first Tribunal decision. That conclusion was determinative of the application to the Tribunal and could not have been affected by the denial of natural justice. 52 It follows that the second Tribunal decision was relevantly unaffected by jurisdictional error. The conclusion of the Federal Magistrate was not in error. 53 The appeal should be dismissed with costs. I certify that the preceding fifty-three (53) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bennett. | whether a second tribunal was entitled to rely on the findings of the first tribunal pursuant to s 416 of the migration act whether the first tribunal decision determined an rrt-reviewable decision application based on "grounds to follow" not valid delegate decision on invalid visa application is nonetheless a decision for the purposes of ss 411 and 412 delegate decision on invalid visa application is an rrt-reviewable decision visa application becomes complete and valid when further information received by the department or by the tribunal procedural fairness applicant not told by the second tribunal that it may rely on the findings of the first tribunal applicant denied the opportunity to address the matters that gave rise to the first tribunal decision denial of natural justice whether denial of natural justice infects the whole decision where there is an alternative basis for the decision actual or imputed bias whether second tribunal demonstrated bias in relying on s 416 migration migration migration |
In 1990 the Aboriginal and Torres Strait Islander Commission (ATSIC) succeeded to the assets and liabilities of the ADC. 2 The money advanced to Mrs Carter and her husband was secured by a mortgage. She and her husband separated in 1992. Subsequently she failed to maintain the repayments. Recovery action was instituted by ATSIC which stood in the shoes of the ADC as mortgagee. This began a very long saga in the course of which Mrs Carter was given more than one opportunity to repay moneys and arrears of payments due under the mortgage by rescheduled instalments. In 1997 she signed an agreement and consented to judgment, including an order for possession of the property. ATSIC undertook not to enforce the judgment while she maintained repayments at an agreed rate. In the event Mrs Carter did not maintain the repayments and, after a number of deferments, ATSIC took possession of the property and sold it, on 6 February 2002, in the exercise of its powers as mortgagee. 3 Mrs Carter instituted proceedings under the Administrative Decisions (Judicial Review) Act 1977 (Cth) (the ADJR Act) in June 2005. She raised a number of contentions against ATSIC and the Australian Government Solicitor (AGS) based upon want of authority to bring the District Court proceedings, lack of service upon her of a consent judgment and a number of other matters. For the reasons that follow, quite apart from questions of the time that has elapsed since the decision and conduct complained of, I am satisfied that none of her contentions have any merit. They were matters of a kind that could have been raised by way of defence to the action in the District Court although I am satisfied that such an exercise would have been futile. It is also very doubtful that the decisions she challenges were administrative decisions under an enactment for the purposes of the ADJR Act. The application will be dismissed with costs. The purchase was financed by a loan of $78,800 from the ADC, a body corporate established by the Aboriginal Development Commission Act 1980 (Cth) (the ADC Act). The loan was secured by a registered mortgage over the land. Its terms required repayment of the principal and interest by monthly instalments of $410 over a term of 32 years. 5 The ADC loan was made in the exercise of statutory powers conferred by the ADC Act. The new Commission, ATSIC, was established (s 6). Under s 207 of the ATSIC Act the assets and liabilities of the ADC became assets and liabilities of ATSIC. That transfer came into effect on or about 5 March 1990. 7 In 1992 Mr and Mrs Carter separated. Mr Carter went to Fitzroy Crossing to live. Mrs Carter remained at 140 Moran Street, Boulder and continued to meet the repayments which had then become due to ATSIC in lieu of the ADC. In 1993 she asked ATSIC to reduce her repayments because she was only earning low wages. That request was refused. She fell into arrears and in February 1994 ATSIC instructed the Australian Government Solicitor (AGS) to institute proceedings to recover the outstanding arrears of the housing loan. 8 On 24 February 1994 a letter of demand was sent to Mr and Mrs Carter by AGS. 9 On 8 June 1994, notice of default under the mortgage was issued to Mr and Mrs Carter. By that time the moneys due under the mortgage amounted to $81,483.26. Mr and Mrs Carter were given seven days after service of the notice to comply with it. Further notices of default dated 19 December 1994 were sent to them on 20 December 1994. By that time the amount under demand was $84,124.85. Senior counsel, acting on behalf of Mrs Carter, negotiated arrangements with her to repay the debt to ATSIC by instalments. In February 1995, AGS was instructed by ATSIC to take no further action in respect of the debt. 10 In March 1995 ATSIC informed AGS that Mr and Mrs Carter were not meeting the arrangements that had been made for repayment. The AGS was instructed to commence proceedings for recovery of the debt. A writ of summons was filed in the District Court of Western Australia on 18 May 1995 claiming $84,965.60 from Mr and Mrs Carter together with interest, possession of the property and costs. The writ was served on Mrs Carter on 17 July 1995. However, on 16 October 1995 the proceedings were discontinued following her compliance with arrangements for repayment of the debt to ATSIC. 11 In February 1996, ATSIC again instructed AGS to commence proceedings against the Carters for recovery of money due under the mortgage. A letter of demand was sent to Mr and Mrs Carter on 22 February 1996. Under the prior arrangements made by Mrs Carter, arrears on the housing loan were to be repaid by instalments of $250 a fortnight. The payments had not been regularly maintained and the arrears, as at 14 February 1996, amounted to $7,025. AGS told the Carters that ATSIC wished to review the arrangement and asked them to complete and return a statement of financial circumstances by 28 February 1996 along with a fresh proposal for payment. Further action to recover the debt was deferred pending receipt of further payments from Mrs Carter. 12 On 6 September 1996 ATSIC instructed AGS that Mrs Carter was no longer maintaining the arrangements for the repayment of the debt. AGS were instructed to recommence legal action. Notices of default under the mortgage were issued on behalf of ATSIC and sent to Mr and Mrs Carter by certified mail on 11 September 1996. These notices demanded payment of the whole of the principal sum, interest and moneys secured by the mortgage which, at 11 September 1996, amounted to $85,769.77. The actual arrears at that time totalled $7,590. 13 ATSIC instructed AGS on 7 November 1996 to commence fresh proceedings against the Carters in the District Court. On 20 November 1996 ATSIC gave information about the loan liability of Mr and Mrs Carter. At that time the discharge balance on the loan amounted to $86,712.23. Proceedings were instituted on 3 December 1996 for recovery of that amount. ATSIC also claimed interest, possession of the property and costs. 14 There followed extensive correspondence between AGS and Mr Ian Viner QC, who was assisting Mrs Carter in negotiations in an endeavour to settle the dispute. The upshot of those negotiations was that Mrs Carter agreed to pay $140 per week to ATSIC in reduction of the secured debt and the sum of $50 per week in reduction of arrears of mortgage repayments. She agreed to consent to judgment. This appears from a letter dated 13 March 1997 from Mr Viner QC to AGS. On 13 June 1997 Mrs Carter signed an agreement with ATSIC in which she consented to judgment being entered in terms of a minute of consent orders which was annexed to the agreement. ATSIC agreed, that while it continued to receive payments from her in accordance with the agreement, it would not execute on the judgment obtained in the District Court action. The agreement provided that should any weekly payment not be received by ATSIC in accordance with its provisions ATSIC would be entitled, without notice to Mrs Carter, to proceed to execute on the judgment. In her affidavit Mrs Carter said she was 'required to sign' the agreement. She said she was then 'forced to sign' a minute of consent orders prepared by AGS. She said that she was '... not given any warnings about signing the Minute of Consent Order until straight after I signed the agreement'. 15 Whatever gloss Mrs Carter sought to put on the signing of the agreement and the minute of consent orders by use of the words such as 'required' and 'forced', I reject the proposition that she entered into the agreement on other than a voluntary basis. She had the benefit of the services of senior counsel and as appears from her own written submissions and affidavit material she is well educated and highly literate. The minute of consent orders provided for judgment to be entered for ATSIC against her only, in the sum of $86,704.23 together with interest at the rate of 7 per cent per annum from 20 November 1996 to the date of judgment. It also provided that she would, within 28 days after service on her of the judgment, give ATSIC possession of the land at 140 Moran Road, Boulder. She was to pay ATSIC's costs of the action fixed at $745. Judgment was entered in those terms when the consent document was filed on 7 July 1997. The judgment as extracted was misdated 19 June 1997. 16 From 28 February 1997 until 5 November 1999, according to Mrs Carter, she paid a total of $15,000 in repayments at $190 per week. However, on 24 March 1999 ATSIC wrote to AGS advising that Mrs Carter had defaulted with her loan repayments and asking that AGS write to her advising that unless she recommenced repayments or made acceptable alternative arrangements, ATSIC might have no alternative but to proceed under the agreement. According to the letter Mrs Carter stopped making regular repayments on 27 November 1998 and her arrears amounted to $3,100. 17 On 1 April 1999 AGS wrote to Mrs Carter saying that it had been instructed by ATSIC that she had failed to meet the terms of the agreement and was in arrears to the extent of $3,100. However, after further representation from Mr Viner QC ATSIC agreed to allow Mrs Carter an opportunity to make arrangements for refinancing. By a letter dated 2 November 1999 Mr Viner QC advised AGS that the National Australia Bank (the NAB) was prepared to provide finance to Mrs Carter to pay ATSIC out. On 4 November 1999 AGS instructed the Sheriff's office to suspend action until further notice. 19 On 7 December 1999 the NAB approved Mrs Carter's application for a loan of $92,000 for the purchase of the property. The approval was valid for three months. It was expressed, in a letter from the NAB, to be subject to Mrs Carter's acceptance of the NAB's normal banking terms and conditions which would be advised in due course. Prior to settlement she was required to provide a copy of a transfer of the land and a Property Insurance Policy. 20 According to Mrs Carter, legal documents were posted to Neil Carter to sign so that the property could be transferred into her name alone. However there was a delay in that process because of cyclones in the Kimberley area in early 2000. Major flooding isolated Fitzroy Crossing for several weeks. In the meantime AGS wrote to Mr Viner QC on 13 December 1999 and 25 January 2000. It asked for the Carters to return a Borrowers' Authority which it supplied to enable ATSIC to obtain the relevant documents required to be produced at settlement. The letter of 25 January 2000 asked when the Borrowers' Authority would be returned. There was no response to either of these letters. On 7 March 2000 AGS received instructions from ATSIC to take legal action to recover the debt due to ATSIC in full and to proceed with execution of the writ of possession. It wrote to Mr Viner QC on that date advising him accordingly and asking that he inform Mrs Carter that she would be required to vacate the premises by 15 March 2000. 21 Mr Viner QC made further representations to the effect that the property would be transferred into Mrs Carter's name alone pursuant to proposed consent orders in the Family Court. ATSIC again agreed to defer taking possession of the property. AGS were advised by Mr Viner QC on 25 July 2000 that orders had been made in the Family Court to enable the property to be transferred into Mrs Carter's name alone. He did not expect there to be any undue delay in the completion of the refinancing. 22 The writ of possession issued out of the District Court on 11 August 1999 expired on 10 August 2000. On 18 August 2000 AGS again received instructions from ATSIC to take possession of the property. It wrote to Mr Viner QC on 21 August 2000 advising of ATSIC's instructions to apply for the issue of a fresh writ of possession. Mr Viner QC was advised that ATSIC had not been provided with a definite date by which settlement was likely to take place. A fresh writ of possession was issued out of the District Court on 7 September 2000. The writ was sent by AGS to the District Court Bailiff on 11 September 2000 and on 5 October 2000 AGS was advised by the Sheriff's office that the property had been repossessed. The amount of the debt was shown on the writ as $90,957.78. Interest to 19 September 2000 was $20,683.84. This made up a total of $114,899.56. 23 On 10 October 2000 Mr Viner QC advised AGS that Mrs Carter's financial arrangements were finally in place. He enclosed a further letter of approval of finance from the NAB bearing that date. Again, the approval was valid for a period of three months. It required, among other things, satisfaction of certain conditions. These included the provision of the copy of a transfer of the land, a Property Insurance Policy and a personal guarantee and indemnity to be given by Mr Viner QC. Evidence was also required that Credit Reference Association of Australia defaults had been cleared and that her personal credit file had been amended accordingly. 24 On 11 October 2000 AGS wrote back to Mr Viner QC. The outstanding amount at that time was said to be $98,253.08 including fees and other disbursements. AGS confirmed that ATSIC had taken possession of the property and would proceed to sell it should they not receive information satisfying them that it was being refinanced with the NAB by 24 October 2000. 25 On 19 October 2000 AGS wrote to Mr Viner QC noting that Mrs Carter had resumed occupancy of the house and asserted that she was trespassing. AGS asked if Mr Viner QC could advise of the position in relation to the refinancing of the property. 26 There were further delays and no evidence was provided of refinancing or of a settlement date. AGS then received instructions from ATSIC to proceed to repossess and sell the property. AGS wrote to Mr Viner QC on 21 December 2000 advising him. However, following further representations from Mr Viner QC, ATSIC again agreed to defer repossession until 8 January 2001. 27 On 22 January 2001 Mr James of Brown James and Associates, Real Estate Agents, informed AGS that he had taken possession of the property but that Mrs Carter would return. AGS confirmed that ATSIC's instructions were to proceed to sell the property and take whatever action was necessary to keep Mrs Carter away from it. Mr James returned to retake possession on 2 February 2001. However, on 7 February 2001 he advised AGS that Mrs Carter had returned to the property. AGS then asked police in Kalgoorlie to remove Mrs Carter. On 7 February 2001, Mrs Carter was charged with being on premises without lawful excuse, contrary to s 66(13) of the Police Act 1892 (WA). She was released on bail on condition that she not enter the property although arrangements were made for her to collect her personal belongings on 8 and 16 February 2001. 28 The property was listed for sale in March 2001. It was valued at $110,000 by RC Lunt & Associates. On 29 April 2001 Mrs Carter wrote to the Minister for Reconciliation and Aboriginal and Torres Strait Islander Affairs (the Minister) asking him to intervene in the sale of the property on the basis that the writ of possession was invalid. The Minister, after AGS had provided advice to ATSIC which was communicated to the Minister, advised Mrs Carter on 11 June 2001 that her concerns had been investigated. He told her that he had been advised that the actions which ATSIC took were in accordance with the provisions of the mortgage. Mrs Carter wrote to Chief Judge Hammond of the District Court on 2 July 2001 alleging that the writ of possession was invalid. There were subsequent proceedings in the Court of Petty Sessions in relation to the charge against Mrs Carter. She was convicted on 13 September 2001 and placed on probation. 29 On 17 September 2001 Mrs Carter told AGS that she had lodged an official complaint with the Anti Corruption Commission about the way in which the writ of possession against the property was obtained. She made reference in her letter to AGS to the filing of documents in the Perth District Court without any authorising signature and without supporting documents from ATSIC. She also made reference to the bailiff 'altering figures'. 30 On 29 November 2001 the Anti Corruption Commission advised Mrs Carter that it had examined her allegations to determine whether investigative or other action was warranted. The Commission told her that the information she had provided had been considered at its last meeting. As the allegation did not fall within s 13 of the Anti Corruption Commission Act 1988 (WA) it was not within the jurisdiction of the Commission. No further action would be taken and the Commission would close its file on the matter. 31 ATSIC accepted an offer of $105,000 on 14 December 2001. Settlement took place on 6 February 2002. ATSIC received the sum of $82,473.34 from the proceeds. The difference between that sum and the purchase price was taken up with the selling agent's commission, shire rates, water rates and other fees and charges. 32 In April 2003 Mrs Carter was granted access by ATSIC to her housing loan files under the Freedom of Information Act 1982 (Cth). 33 In September 2004 ATSIC instructed AGS to commence enforcement proceedings against Mrs Carter for payment of the balance of the outstanding judgment debt in the District Court proceedings. The amount involved was $31,619.20 as at 18 August 2004. AGS filed a Chamber Summons in the District Court on 25 November 2004 for an order that Mrs Carter be orally examined. An order was made on 9 December 2004 for her oral examination. However Mrs Carter did not attend the hearing on 3 February 2005. The oral examination was re-listed for 19 April 2005. 34 In the meantime ATSIC was abolished by the Aboriginal and Torres Strait Islander Commission Amendment Act 2005 (Cth) with effect from 24 March 2005. On 19 April 2005 Mrs Carter's oral examination was re-listed in the District Court for 28 June 2005 by order of Commissioner Keene. 35 On 2 June 2005 Mrs Carter instituted proceedings in this Court to review decisions and conduct of AGS and ATSIC in relation to the sale of the property. The hearing in the District Court proceedings listed for 28 June 2005 was adjourned as the order for Mrs Carter's attendance had not been served. By letter dated 28 July 2005 AGS advised the District Court that it had instructions to seek the suspension of further action pending clarification of the correct entity to be substituted as plaintiff in the District Court following the abolition of ATSIC. 36 On 3 November 2005 a Registrar in the District Court ordered that the plaintiff in those proceedings be changed to Indigenous Business Australia (IBA). AGS were instructed by IBA to proceed with enforcement action to recover the outstanding debt from Mrs Carter. 37 The present proceedings were heard on 6 June 2006. Because of the abolition of ATSIC no claim is, or can be, pursued against it. In her application Mrs Carter purports to seek a review of 'the decision' of AGS in giving instructions on 2 January 2001 to Brown James & Associates Real Estate Agent in Kalgoorlie to sell her property '... unlawfully and on fraudulent grounds without the authorization of the ATSIC Board of Commissioners (pursuant to Section 21(2) and 45(1)(a) of the ATSIC Act 1989); and with no evidence of Judgment'. She seeks review of the conduct of the Commonwealth apparently on the basis that ATSIC was not authorised to give instructions to AGS to repossess her property. 39 Mrs Carter also claims to seek review of the decision '... in which money was offered to myself and Neil Carter under Part V of the former Aboriginal Development Commission Act 1980 , which is evident the money should never have been repaid' (sic). 40 She says she is aggrieved by the decision of AGS and the conduct of ATSIC because AGS increased her mortgage finance 'fraudulently, without evidence and supporting material, and then refused to accept a bank loan of $92,000 from me to re-finance my property, thus enabling [AGS] to execute my property'. She asserts her belief that ATSIC was fully aware of the 'fraudulent decision made by [AGS]'. 41 Mrs Carter added a general allegation that ATSIC and AGS had 'seriously breached the Aboriginal & Torres Strait Islander Commission Act 1989 on numerous occasions, and failed to take into account ATSIC's Home Loan Policy approved annually by the ATSIC Board of Commissioners'. 42 The grounds of the application comprised an unparticularised listing of the grounds available under the ADJR Act. 43 By way of relief Mrs Carter claimed an order that she be reimbursed for all costs associated with the loss of her property and an order for the Commonwealth and AGS to pay damages and compensation for humiliation suffered by her as a result of the loss of the property. Other orders of an ancillary character were also sought. She repeated the contention in the statement of claim that AGS did not have 'written authorization' from ATSIC to give instructions to a real estate agent in Kalgoorlie to sell her property nor to give instructions to the Kalgoorlie police to remove her from her property. She claimed in the statement of claim that she had been treated unfairly by ATSIC and AGS ever since a case concerned with the winding up of a body known as the Murnkurni Women's Aboriginal Corporation. Mrs Carter said that, at the time that an application for the winding up of that corporation was pending in the Federal Court, she was an ATSIC Regional Councillor. She made a reference to an alleged failure by AGS to '... declare in court a $13,000 they received from ATSIC, for legal costs, when in fact legal costs was supposed to be recovered from the sale of the building owned by Murnkurni' (sic). She said that this sum was later returned to ATSIC after she raised the matter at an ATSIC Regional Council meeting. She claimed that soon after this court case AGS gave legal advice to ATSIC to suspend her as an ATSIC Regional Councillor. She asserted her belief that the sale of the property at 140 Moran Street, Boulder stemmed from the Murnkurni court case. She said there was no evidence that ATSIC's Board of Commissioners made the decision to sell the property. 45 Mrs Carter claimed that ATSIC staff did not have power to make decisions on behalf of the Board of Commissioners unless there was a delegation process authorised by the Board. Her core claim appears to be that ATSIC and AGS were not authorised to make the decision to sell her property. 46 In oral argument at the hearing, Mrs Carter advanced a submission that the money provided to her by the ADC was a grant instead of a loan. This, of course, was entirely inconsistent with her execution of a mortgage agreement under which she assumed an obligation to repay the moneys. It was also a matter which, if there were any substance in it, could have been raised in the District Court. Plainly, however, the advance made to Mrs Carter and her husband was by way of a loan. 47 Next Mrs Carter referred to s 21 of the Act. That section imposed restrictions on the rights of individuals or bodies who had been financed in the acquisition of interest in land by ATSIC so that such individual or body could not dispose of the interest without ATSIC's written consent. Mrs Carter seemed to think that this provision imposed some restriction on the power of ATSIC to dispose of her property. This was not the case. 48 She then addressed the question of the authority of staff members of the ADC and/or ATSIC to enforce the mortgage without a specific delegation from their respective Commissions. However, both the ADC and ATSIC could take recovery action through their employees without the requirement of any specific delegation. The right to pursue recovery was conferred as between ATSIC and the Carters by the terms of the mortgage itself. 49 Mrs Carter next raised a point about the provisions of the Transfer of Land Act 1893 (WA) and the requirement in s 106 for a notice of default to be served on the mortgagor. Whatever point she was trying to make in that case, was a point which could have been taken in the District Court. Mrs Carter also raised a question about the service of the judgment on her. 50 Counsel for the respondents contended that none of the decisions or conduct the subject of the application was a decision or conduct leading up to the making of a decision under an enactment. On that basis it was said that the Court did not have jurisdiction under the ADJR Act to review the decisions and conduct complained of. I am inclined to agree with that proposition. However, even if the Court did have jurisdiction, none of the submissions made by Mrs Carter are tenable. None of them has any merit in law. If they did, it was open for Mrs Carter to raise them by way of defence to the recovery proceedings in the District Court. What she in fact did, was to sign an agreement to compromise the action and to consent to judgment. 51 Behind the complex history, the simple reality is that Mr and Mrs Carter were advanced moneys for the purchase of a home. They were advanced those moneys on condition that they repay them in accordance with the terms of a mortgage which secured the advance. They did not comply with the terms of the mortgage. Mrs Carter did not honour the terms of an agreement which she subsequently entered into in order to prevent repossession of her property. The judgment to which she consented pursuant to that agreement was subsequently executed. No basis has been shown for the grant of any relief in her favour. It is the end of a long saga in the course of which Mrs Carter has been given more than one opportunity to comply with her obligations. The application will be dismissed with costs. I certify that the preceding fifty-two (52) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. | judicial review loan advanced by statutory authority for purchase of house and land secured by mortgage repayments not maintained power of sale under mortgage exercised by aboriginal and torres strait islander commission whether commission authorised to exercise power of sale judicial review of decisions and conduct of commission and australian government solicitor no tenable grounds for review all matters relevant to defence of recovery proceedings application dismissed administrative law |
The Western Australia District Registry is the "proper place" within the meaning of that expression in O 1, r 4 of the Federal Court Rules (the Rules) unless a transfer is ordered. By motion dated 31 March 2009, the respondent applied, pursuant to s 48 of the Federal Court of Australia Act 1976 (Cth) and O 10 r 1(2)(f) of the Rules, for an order transferring the proceedings to the Court's New South Wales District Registry at Sydney. The principles governing the transfer of proceedings are well known and were set out by the Full Court (Bowen CJ, Woodward and Lockhart JJ) in National Mutual Holdings Pty Ltd v The Sentry Corporation (1988) 19 FCR 155 at 161 --- 163. They include the following: In Sentry the Full Court explained (at page 162) that the factors which the Court is entitled to take into account in considering whether the proceedings should be transferred are numerous and include "residence of parties and of witnesses, expense to parties, the place where the cause of action arose and the convenience of the Court". The Court also stated (at page 162) that due weight should be given to the reason for which the party commencing the proceedings chose the particular place in which the proceedings were commenced and the stage of the proceedings. The respondent relied on the affidavit evidence of Mr John Patrick Keogh, sworn on 30 March 2009 to support the transfer of these proceedings from Perth to Sydney. Counsel for the respondent made the following submissions in support of the application: This is one of those applications which, in the end, is reasonably finely balanced. Despite the submissions that have been made in writing and orally by Mr Thompson for the respondent, I am not satisfied there should be a transfer of the proceedings to Sydney. My reasons for coming to that conclusion are not that it is obviously the case that there is no merit in the respondent's proposal; plainly there is some practical merit in it. However, the applicant companies are Perth-based. They have commenced the proceedings in the Western Australia District Registry at Perth. The authorities show that due regard should be had to that fact. It is not merely a matter of the balance of convenience, which sometimes, in any event, can be difficult to assess in the early stages of a proceeding. But so far as the balance of convenience is concerned, the tyranny of distance perhaps goes both ways. Whilst it appears there may be witnesses based in Wagga Wagga who may need to be called in respect of any loss and damage that is established from activities in that area as the respondent suggests, a transfer of the proceedings to the New South Wales District Registry at Sydney would likely require the applicants, who have brought the proceedings, to engage Sydney-based representatives, or otherwise operate remotely in respect of the Registry of the Court in progressing their claim. Indeed, as the applicants suggest, a transfer may require both sides to engage Sydney-based representatives. It is reasonably trite to say that in a national court like this, parties can indeed participate in proceedings in one registry from other parts of the country. There is no formal requirement for a party to engage a locally-based solicitor, although for convenience sake it is often a sensible arrangement. It is however, possible for parties to use both the telephone and video conferencing facilities to participate in pre-trial proceedings, and that not uncommonly happens in this Court. It is a separate issue, however, whether the Court at some later stage might exercise its power under O 30, r 6(2) of the Rules, either on its own motion or on the application of a party, to hold the trial of the proceeding somewhere other than the registry which is the "proper place". It is a little too early to know exactly what the strength of an application to hold the trial in Wagga Wagga or Sydney might be. I leave that issue aside for the moment. If it were to arise later, it would most likely come at a point in the conduct of these proceedings in the Western Australia District Registry at Perth when the matter is being listed for trial. The issue might then arise of just how or where the trial should best be conducted, taking into account the issues, the interests of all the parties, the number of witnesses, the location of counsel, not to mention the Court's convenience. For these reasons, fairly simply put, the notice of motion dated 31 March 2009 for transfer of the proceedings to the Court's New South Wales District Registry at Sydney is dismissed. The respondent is to pay the applicants' costs of the motion. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker. | application by respondent for transfer of proceedings to new south wales district registry at sydney cause of action arose in new south wales applicant companies perth based early stage of proceedings not merely a matter of the balance of convenience national court application dismissed practice and procedure |
The next day he applied for a protection (class XA) visa. His application was refused by a delegate of the first respondent on 20 October 2005. 2 On 14 November 2005 he applied for a review of the delegate's decision by the Refugee Review Tribunal ('the RRT'). The RRT handed down a decision on 14 February 2006 affirming the decision of the delegate not to grant a protection visa. 3 On 13 March 2006 the appellant made an application for judicial review to the Federal Magistrates Court. That application was dismissed by Emmett FM on 4 December 2006. By a Notice of Appeal filed on 19 December 2006 the appellant appeals to this Court. RRT failed to carry out its statutory duty. RRT failed to notify me in writing about the reasons RRT may affirm the decision from DIMIA. RRT had bias against me when considering my my [sic] application. RRT refused my application without giving rasonable [sic] foundation. RRT failed to refer to sufficient independent information for the consideration of my application. The appellant gave oral evidence to the RRT on 12 January 2006. The RRT decision records that, at the hearing, he 'essentially repeated his claims' made in his visa application. It then recorded further information obtained from the appellant at the hearing. 9 The appellant's claims were that in April 2005 he was arrested, detained and then tortured whilst in detention because he was found in possession of documents left with him by a business acquaintance, Mr Chen, which documents related to an unregistered religious group in China known as the 'Shouters'. These claims were accepted by the RRT, they were not used to decide any matter adversely to the appellant. 12 The basis of the RRT's decision adversely to the appellant was that, despite his two week detention in April 2005, there was no indication the appellant had been of any interest to the Chinese authorities either before or after that period and as the appellant 'stated that he has no interest in religious activities' the RRT was 'satisfied that he is not involved or implicated in any activity which will attract the adverse interest of the PRC authorities in the reasonably foreseeable future'. 13 On these grounds the RRT was not satisfied the appellant had a well-founded fear of persecution in China for reason of religion or any other Convention reason. 14 The information upon which these findings were made was provided by the appellant at the hearing and was not required to be given back to him in writing for his comment (see s 424A(3)(b)). 15 The matters I have referred to are, in substance, the reasons given by Emmett FM at paras 24 and 25 of her judgment for rejecting the sole ground in the appellant's amended application for judicial review. No error has been, or could be, shown in that conclusion. 16 Despite the limited ground of challenge in his amended application for judicial review, and the fact that, by that amended application, he had effectively abandoned any allegation of bias, at the hearing before Emmett FM the appellant gave voice to such an allegation. He also suggested that the RRT made its decision 'on suspicion and a guess', that the RRT had wrongly assessed he was not a member of the Shouters group (but he had never said he was --- he said he was not interested in religion or religious activities) and that the RRT had misunderstood the risk from the Chinese authorities' perception that he was close to Mr Chen. 17 Emmett FM rejected all these allegations. She was correct to do so. None had any apparent substance and some were contradicted by evidence the appellant himself gave to the RRT. 18 The appeal to this Court advances three grounds. The Tribunal failed to consider my application according to S424A of the Migration Act 1958 . The Tribunal did not notify me the reason or part of the reason for affirming the decision. The Tribunal failed to consider my claims for my application for a protection visa. The Tribunal failed to consider my application according to S91R of the Migration Act 1958 . The Tribunal failed to refer to independent information for the consideration of my application. 20 The second ground contains two allegations. The first is without any merit and obviously wrong. The second limb is, as the first respondent's counsel submits, misconceived. Disposition of the appellant's claims did not raise an issue requiring consideration of s 91R of the Act. This appears to be a currently fashionable ground of appeal but it has no application to the present matter. 21 The third ground has no basis in fact. The RRT did refer to independent country information. Some supported the appellant's claims, some did not. The RRT explained the use which was made of the information. As earlier discussed, it was not required to be put to the appellant for his comment. 22 At the hearing of the appeal the appellant, through an interpreter, in effect, repeated the matters set out in the Notice of Appeal but added as well that the RRT was biased. 24 When he was invited to add anything further the appellant indicated he had not seen a copy of the written submissions for the first respondent. He was shown a copy of a letter addressed to him dated 28 February 2007 from solicitors for the first respondent telling him of the time and place of the hearing of the appeal and stating that a copy of the written submissions were attached thereto. He accepted seeing the letter but not any attachment. 25 A copy of the written submissions for the first respondent was then provided to him and the matter was stood down so that they could be read to him as translated. 26 When the hearing resumed the appellant did not specifically address the first respondent's written submissions but added to his earlier remarks, that the RRT had wrongly assumed he would not be persecuted if he returned to China where he had in fact been earlier persecuted for religious activities. I understood these remarks to relate to the matters he had relied on before the RRT and to suggest the RRT had reached a wrong conclusion about them. For the reasons I have already given I am not satisfied that any relevant error has been established. 27 I am satisfied the appellant was not denied a fair opportunity to advance any argument he wished in support of his appeal. 28 The challenges to both the decision of the RRT and the judgment of Emmett FM are without substance. No jurisdictional error has been shown in the work of the RRT. No error has been shown in the judgment of Emmett FM. 29 I will dismiss the appeal with costs. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan. | protection visa no jurisdictional error migration |
The appeal is from a decision of a delegate of the Commissioner of Patents made on 12 December 2002 whereby the delegate allowed part of the opposition and refused to order that the accepted patent application number 713629 proceed to grant. The patent applicant ('the appellant') appealed by notice of appeal dated 21 January 2003, pursuant to s 60(4) of the Patents Act 1990 (Cth). 3 The patent application in issue is entitled 'Ruminal Bolus for Electronic Identification of a Ruminant'. The specification relates to a bolus or large pill which is to be used in identifying ruminant animals. The device comprises a solid body composed of aluminium oxide which encloses electronic transmitting components. It is designed to be swallowed by the animal so that electro-magnetic data can be transmitted and then used for tracking and other management purposes. 4 The original respondent in the appeal, Aleis International Pty Ltd ('Aleis'), did not appear at the hearing. By affidavit sworn 13 March 2006, Mr Ian David Hughes, a partner of Deacons, the solicitors for Aleis, deposed that he had been instructed that Aleis wished to withdraw its appearance and take no further part in the appeal. Aleis instructed Deacons to file a notice seeking leave to do so. Mr Hughes also deposed that he held instructions to institute revocation proceedings in respect of any patent that might be granted to the appellant as the result of a successful appeal. Those revocation proceedings, according to Mr Hughes, are likely to raise various grounds of invalidity including fair basing, manner of manufacture and inventive step, prior use, prior publication and such other grounds as may be advised. 5 At a hearing on 17 March 2006, I granted Aleis leave to withdraw its appearance in the proceedings. In those circumstances, the Commissioner of Patents was substituted as the respondent in the proceeding. On 17 March 2006, a representative of the Commissioner of Patents appeared and informed the Court that the Commissioner of Patents did not oppose the orders sought by the appellant in the appeal, and did not wish to appear further in the proceedings. 6 There was no appearance on behalf of the Commissioner of Patents at the hearing on 16 May 2006. I was informed by senior counsel for the appellant, Mr McGowan, that the position adopted by Commissioner of Patents had not changed since 17 March 2006. 10 In an appeal, the issue for decision would be whether, if granted, the patent would be clearly invalid. The authorities dealing with the issues that arise in an appeal and the onus of proof are canvassed by Emmett J in Hoffman-La Roche , particularly at 66-70 [48]-[66]. I consider that, before the Court would uphold an opposition to the grant of a patent, the Court should be clearly satisfied that the patent, if granted, would not be valid. In those circumstances, the accepted patent application stands unchallenged and it was submitted that it must be allowed to proceed to grant. 12 These submissions are made good by a number of authorities to which I was referred: Titan at 75-76; Caroma Sales Pty Ltd v Philmac Pty Ltd (1972) 46 ALJR 324 (' Caroma' ) at 324 per Walsh J; Brickwood Holdings Pty Ltd v ACI Operations Pty Ltd [1983] 2 VR 587 (' Brickwood' ) at 588-589 per King J. The duty of the Court in such proceedings is to exercise de novo the function of the Commissioner under s 60. The Court must exercise that function only on the basis of the evidence adduced in the proceedings before it. The material before the Commissioner or his delegate when he made the decision appealed from is not to be treated as being before the Court unless it is tendered and admitted in the proceedings before the Court (cf the Supreme Court Rules , Pt 81 , r 14). Evidence which was not before the Commissioner may also be admitted before the Court. This recognises that a decision under s 60 has a public aspect going beyond the mere resolution of a contest between the applicant and the opponent. This public aspect is further recognised by s 149 of the Act which contemplates active intervention by the Commissioner before the Court, with leave, in such proceedings as this. The non-appearance, or withdrawal, of the opponent provides an obvious occasion for such intervention where there are matters to which, in the public interest, the Commissioner desires to have the Court direct its attention. Unless invalidity on such a ground is clearly shown, the application should be allowed to proceed to a grant and the validity of the patent left to be determined in infringement or revocation proceedings. In my opinion that submission is correct. ...[T]he enactment that the Tribunal may admit further evidence ought not to be taken, in my opinion, as implying that the Tribunal must treat all evidence which has been given at a hearing before the Commissioner or his officer as being evidence in the proceeding before the Tribunal. As Kitto J. said in Kaiser Aluminum & Chemical Corporation v Reynolds Metal Co. [1969] HCA 7 ; (1969), 120 CLR 136, at p. 142, an appeal under s.60(5) of the Act is in truth an original proceeding and "it must be decided upon the evidence adduced before this Court". His Honour referred to some authorities dealing with the nature of the jurisdiction exercised by this Court in taxation "appeals". One of those authorities was Commissioner of Taxation v Finn [1960] HCA 69 ; (1960), 103 CLR 165. In that case, at pp. 167-168, Fullagar J. cited passages from the judgment of Williams J. in Federal Commission of Taxation v Sagar [1946] HCA 6 ; (1946), 71 CLR 421, at pp. 423-424, including the following passage: "The appeal is a proceeding in the original jurisdiction of the Court so that, unless the parties agree that the evidence given before the Board shall be used on the appeal, the evidence must be tendered again, and, as the appeal is a rehearing, further evidence can be called". These have not been tendered before me. ... There has been no proof before me of any facts alleged in the statutory declarations supporting the opposition, except to the extent that the affidavit or oral evidence tendered on behalf of the appellant refers to those facts. King J allowed the appeal and ordered that the patent application proceed to grant. Thus, in view of the respondent's withdrawal and the attitude of the appellant, the Court had before it an opposition unsupported by any evidence or opponent. This was, I think, a basis for allowing the appeal. In my view, the Commissioner's expressed attitude of passivity justified my making such an order. It is to be distinguished from the present case in at least two respects. In the first place, the appellant, which was, as here, the patent applicant, voluntarily proceeded with the hearing... The question whether it would have needed to proceed with the hearing, if it had not wished to seek leave to amend, was not raised. In the second place, the respondent did not consent, either expressly or by implication, to the appellant's course of action. All that it did was abstain from appearing. 16 In this case, there is no evidence capable of supporting the opposition, as none has been tendered. The opponent has withdrawn and the Commissioner of Patents does not wish to take an active part in the proceeding. Consequently, in my opinion, there is no basis on which this Court can uphold any ground of opposition. 17 Mr McGowan has drawn my attention to the fact that the grounds available to the Court to refuse a patent application are all those available to an opponent, whether relied upon by the opponent or not: see s 60(3) of the Patents Act and Titan at 75. However, I agree with his submission that the grounds available can only be those which are supported by evidence or which do not require evidence. The only ground of opposition taken below was that of prior user, and no evidence capable of supporting that ground has been adduced before me. Nor has any cross-contention been filed that would raise any other issue. 18 I have also taken into account that s 20(1) of the Patents Act makes it clear that the grant of a patent is no guarantee of validity. Here, indeed, Mr Hughes' affidavit indicates that the original opponent intends to institute revocation proceedings. In those circumstances, there is, in my opinion, no reason why the Court need examine the merits of the opposition. That is particularly so where the Commissioner of Patents, who would normally raise public interest factors for the assistance of the Court, has indicated that it does not oppose the orders sought in the appeal. 19 Accordingly, I propose to make the orders sought by the appellant. There is no need, having regard to the authorities, for this Court to embark upon a consideration of the merits of an opposition that has not been pursued. I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Young. | appeal from decision of patent commissioner opposition to patent application where respondent granted leave to withdraw appearance where no appearance on behalf of the commissioner whether it is appropriate to allow patent to proceed to grant relevant legal principles whether necessary to consider merits of patent application opposition dismissed patent allowed to proceed to grant patents |
Their number is not large - there are approximately 750 individuals currently recognised as registered patent attorneys in Australia, up from about 250 in 1996: see Professional Standards Board List of Registered Patent Attorneys as at 23 May 2008; Department of Science and Technology, Review of the Regulatory Regime for Patent Attorneys , report to the Minister for Science and Technology (June 1996) ("the Johns Committee Report") at xiii. As a result of both the statutory monopoly and the limited number of practitioners, registration (and the qualifications) is a matter of significant consequence both to intellectual property practitioners and the consumers of their services. 2 Registration of patent attorneys is regulated by the Patents Act 1990 (Cth) ("the 1990 Patents Act ") and the Patent Regulations 1991 (Cth) ("the Regulations"). As with any guild or quasi-guild system, the fundamental conflict between the guild members and prospective entrants concerns where the barriers to entry should be set. Not surprisingly, members argue that barriers should be high in order to promote the public interest of ensuring high quality of service. Prospective entrants of course argue that barriers should be lower in order to promote the competing public interest of ensuring healthy competition and low costs of service. In this case, the age-old conflict plays out in the shape of a challenge by a prospective entrant to the construction of the Regulations regarding the work experience prerequisite to registration. For the reasons that follow, that challenge fails and the application for judicial review must be dismissed. 3 On 11 October 2007, Stephen Wallace White ("the Applicant") was refused registration as a patent attorney by the Designated Manager of IP Australia ("the Respondent") because he did not have the employment experience prescribed in s 198(4)(c) of the 1990 Patents Act and reg 20.3 of the Regulations. At all relevant times, the Applicant has been and remains a legal practitioner practising as a sole practitioner under the firm name "White SW Computer Law". The Applicant is the principal of that firm. He has practised in that manner for some 14 years and, in that capacity, has been involved in intellectual property matters. 4 The Applicant seeks review of the Respondent's decision under s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act "). 6 Regulation 20.3(3) prescribes the "employment" for the purposes of s 198(4)(c) of the 1990 Patents Act . The Respondent proceeded to consider the application for registration under reg 20.3(3)(a)(ii) and concluded the Applicant's employment experience did not satisfy reg 20.3(3)(a)(ii). He was in fact, employed by his own firm. Mr White's firm was not prosecuting its own patent matters but the matters of others. The services provided would have been intermittent and interspersed with other clients' legal matters. In my view, this assertion is not contemplated by regulation 20.3(3)(a)(ii). Looking at the subparagraph in context it is clear that the [1990 Patents] Act draws a distinction in relation to the sort of work a person could do in each circumstance. For example, a person on their own behalf, or as an employee of a company on behalf of the company, could draft their own specifications for a patent application. A person, who is not a registered patent attorney, cannot do this in any other circumstances, including a legal practitioner working in a legal practice practicing (sic) in patent matters. In fact it is an offence pursuant to section 201 of the [1990 Patents] Act. 9 At the commencement of the hearing, I refused the Applicant leave to include in the Amended Application an allegation that the Respondent had breached s 10 of the Racial Discrimination Act 1975 (Cth): see White v Designated Manager of IP Australia [2008] FCA 815. Although a number of the remaining grounds of review were raised for the first time in the Amended Application, the Respondent did not oppose the Applicant being granted leave to raise those issues at such a late stage. As these reasons for decision will demonstrate, each ground of review is without merit. 10 Before turning to consider each of the grounds of review, it must be noted that, to a significant extent, the Applicant's written and oral submissions proceeded, or at least appeared to proceed, on the premise that the Court's task involved a reconsideration of the merits of the decision. That premise is not correct. If, in so doing, the court avoids administrative injustice or error, so be it; but the court has no jurisdiction simply to cure administrative injustice or error. The merits of administrative action, to the extent that they can be distinguished from legality, are for the repository of the relevant power and, subject to political control, for the repository alone. The issue was whether the Respondent's construction of reg 20.3(3) (see [6] above) was the proper construction. In my view, subject to one exception which did not affect the Applicant adversely, it was the proper construction. Again, subject to one issue which does not affect the outcome of the current application, the Respondent's construction was consistent with the express words of the 1990 Patents Act and the Regulations. 13 As noted above, reg 20.3(3) prescribes the employment which satisfies s 198(4) of the 1990 Patents Act . It prescribes two elements: the nature of the employment and a time period. The time element is addressed in par (b) of reg 20.2(3). 14 Insight into the purpose of the experience requirements in reg 20.3(3) can be gleaned by reading ss 200 to 202 of the 1990 Patents Act to understand the meaning of and difference between the terms "registered patent attorney" and "patent attorney" in the context of reg 20.3(3). First, s 200 provides that a registered patent attorney, who need not be a legal practitioner, is entitled to transact all business and conduct all proceedings under the 1990 Patents Act , save that he or she may not deal with court proceedings: s 200(3). Secondly, ss 200(1) and 201 (7) state that a "patent attorney" - who may be either a "registered patent attorney" or a "legal practitioner" - is someone who applies for patents, prepares specifications, or gives advice about the validity or infringement of patents. Finally, s 202 provides that a legal practitioner who is not a registered patent attorney may do everything that a registered patent attorney may do except prepare specifications. The net effect is that a legal practitioner, such as the Applicant, who gives advice about patent applications, validity, and infringement, may properly hold himself out as a "patent attorney" (at least for some purposes - whether the Applicant would qualify as a "patent attorney" for purposes of reg 20.3(3)(a)(i) is a separate question: see [49]-[51] below). In other words, the difference between a legal practitioner and a registered patent attorney is that only the former may deal with court matters and only the latter may draft specifications. Read in this context (ie that the preparation of patent specifications is the only area of patent law that is the exclusive domain of registered patent attorneys), it would seem apparent that the capacities in reg 20.3(3) are intended to prescribe three separate ways a person may gain the experience necessary to gain entry to this exclusive domain --- namely, experience in drafting and construing patent specifications. 15 At no time did the Applicant satisfy the literal meaning of any of the capacities of employment specified in reg 20.3(3)(a). The Applicant accepts that at no time has he been employed in the Patents Office as an examiner of patents. Moreover, as the facts demonstrated, at no time has he been employed in a company practising in patent matters on behalf of the company or a related company ((a)(ii)). Assuming for the sake of argument that a law firm may be considered a company for the purposes of the regulation, the Applicant's evidence was that he was employed in his own law firm, White SW Computer Law. However, he conceded that he had not practised in patent matters on behalf of his law firm (as opposed to on behalf of his clients). Moreover, the Applicant provided no evidence that the client companies on whose behalf he had practised were related companies to his law firm within the meaning of s 50 of the Corporations Act 2001 (Cth) ("the Corporations Act "), which provides that holding companies and subsidiaries of corporations are related. Finally, the Applicant, a sole practitioner, presented no evidence that he was employed as a technical assistant in a patent attorney's office ((a)(i)); to the extent that he submitted that, for purposes of the regulation, he should be considered to have been employed as his own technical assistant, that submission is rejected as absurd on its face as well for the reasons discussed below. 16 In spite (or perhaps because) of the Applicant's failure to qualify under the plain meaning of the regulation, the Applicant submitted that the plain meaning or construction of reg 20.3(3)(a) adopted by the Respondent was too narrow and should not be preferred "to one which advances / promotes the purpose of the legislation or underlying object of [reg] 20.3". In effect, the Applicant submitted that the regulation should be construed so that virtually any legal practitioner having been employed in a firm where he or she dispensed patent advice to the firm's clients for the requisite period of time has satisfied the employment qualification for being registered as a registered patent attorney. To put it another way, the Applicant seeks to have legal practitioners exempted from the separate employment experience required by the regulation. 17 Assuming, without deciding for the moment, that reference to the underlying purpose of the 1990 Patents Act would in fact support the Applicant's construction, I do not consider that an appeal to purpose can succeed in the circumstances of this case. As can be seen, the Applicant is effectively asking the Court to rewrite the regulations, first by substituting, at a minimum, the word "for" in place of the word "in" in reg 20.3(3)(a)(ii) so that it would read "in employment for a company practicing in patent matters"; and second, by adding a gloss so that the technical assistant and the patent attorney referred in reg 20.3(3)(a)(i) may be the same person so that the requirement effectively reads "performing tasks similar to those of a technical assistant under one's own supervision" (or, to put it more literally and highlight the syntactic absurdity, "employed as a technical assistant in the technical assistant's practice"). 18 I cannot accept such a construction. It is true that s 15AA of the Acts Interpretation Act 1901 (Cth) directs a court to prefer a construction promoting the purpose or object of an Act. It is also true that patent textual ambiguity is not required in order to consult purpose (ie reference to purpose may be had both to raise as well as to resolve ambiguity): Saraswati v Queen [1991] HCA 21 ; (1991) 172 CLR 1 , 22; see also Kowalski v Domestic Violence Crisis Centre Inc [2001] FCA 1082 ; (2001) 113 FCR 67 at [23] . 19 Nevertheless, the purposive approach to statutory construction is not a carte blanche licence to courts to depart from unambiguous plain meaning. A court cannot depart from "the ordinary meaning" of a legislative provision simply because that meaning produces anomalies[. The only exception to this rule is where the ordinary meaning would lead not just to an anomaly, but to a result that is "manifestly absurd" or "unreasonable": Saraswati [1991] HCA 21 ; 172 CLR 1 at 22; see also Chiropedic Bedding Pty Ltd v Radburg Pty Ltd (2007) 74 IPR 398 at [23]. 20 Here, the Applicant has failed to advance any plausible competing construction (ie he has failed to demonstrate any patent or even latent ambiguity in the text as a matter of ordinary syntax and grammar); I consider the text grammatically capable of only one meaning. Moreover, neither the context nor purpose of the Act (to which I have briefly referred to earlier and will come to in greater detail below) throw any real doubt on that ordinary meaning. Finally, the ordinary meaning leads to a result that is neither manifestly absurd, irrational, or otherwise unreasonable. Accordingly, I consider that there is no general judicial power to redraft the regulation even if the result in this case (that the Applicant's work experience as a sole practitioner does not qualify him to be a registered patent attorney) were anomalous (which I do not accept), and such an amendment would in fact bring it into greater conformity with the underlying legislative purpose (which I also do not accept). 21 Although I need go no further on the construction point (save for the examination of purpose and context which I will come to), I should address the construction error of the Respondent referred to earlier, which has until now been covered up by the assumption I previously made for the sake of argument that a firm might also be considered a company within the meaning of the regulation. While it was convenient to make that assumption (in that nothing of consequence turns upon it in the present case), I should clarify that a legal practitioner in the position of the Applicant is not employed in a company (ie a firm, including a law firm, is not a company). 22 The Applicant contended that the reference to "in a company" should not be read literally but should be extended to include employment " in a company or a firm" . The Respondent adopted that construction in par 5.8 of his reasons for decision (see [7] above). I do not accept that references in reg 20.3(3)(a)(ii) to "company" should be read in that manner. A law firm, other than an incorporated legal practice, is not a company within the meaning of the Corporations Act ": see ss 9 and 119 (stating that a company means a company registered under the Corporations Act and comes into existence as a body corporate on the day of registration); Legal Profession Act 2004 (Vic) ss 2.7.2 and 2.7.4 (stating that an incorporated legal practice is a company within the meaning of the Corporations Act ). The Applicant accepted that his firm is not registered under the Corporations Act . Moreover, even assuming that the definition found in the Corporations Act should not be interpolated into reg 20.3(3)(a)(ii), the ordinary common law understanding of company would not assist the Applicant either: Macleod v Queen [2003] HCA 24 ; (2003) 214 CLR 230 at [28] (stating that the essential meaning of "company" since the time of Salomon's Case , has been as a body with a separate legal identity); see also Sons of Gwalia Ltd v Margaretic [2007] HCA 1 ; (2007) 81 ALJR 525 at [3] - [4] (observing the historical distinction, dating back to Salomon's Case , between firms (partnerships) and companies (corporations)); Salomon v Salomon & Co Ltd [1897] AC 22. Again, the Applicant presented no evidence that White SW Computer Law is a distinct legal entity as opposed to an unincorporated sole proprietorship. 23 To the extent that the Respondent considered that employment in a firm could be considered employment in a company for the purposes of the regulation, it follows that he took an irrelevant consideration into account. However, that error may be put to one side because, on any view, it was an error which favoured the Applicant. If a proper construction of reg 20.3(3)(a)(ii) had been adopted, the result would not have been any different and thus the error was harmless: Re Refugee Tribunal; Ex parte Aala [2000] FCA 57 ; (2000) 204 CLR 82 at [104] (stating that relief on judicial review will be refused where the court is satisfied that the error did not affect the outcome of the administrative decision). 24 I now turn to a more detailed consideration of the purpose and context of the 1990 Patents Act as foreshadowed above. As these reasons for decision will demonstrate, there is nothing in the other provisions of the 1990 Patents Act or the Regulations, or the historical materials, which suggests, let alone supports, the Applicant's construction of reg 20.3(3)(a)(i) or (ii). On the contrary, those materials all demonstrate that it was the intention of the Parliament that a person in the position of the Applicant should not be registered as a patent attorney. Chapter 20 is entitled "Patent Attorneys". Part 1 is entitled "Registration, Privileges and Professional Conduct". Offences are dealt with in Pt 2. 26 Section 200 , headed "Privileges", provides that certain privileges attach to registered patent attorneys. (2) A communication between a registered patent attorney and the attorney's client in intellectual property matters, and any record or document made for the purposes of such a communication, are privileged to the same extent as a communication between a solicitor and his or her client. (3) Nothing in this section authorises a registered patent attorney to prepare a document to be issued from or filed in a court or to transact business, or conduct proceedings, in a court. (11) For the purposes of this section, the question of whether a company is related to another company is to be determined in the same manner as that question is determined under the Corporations Act 2001 . 29 A number of principles emerge from consideration of these provisions of the 1990 Patents Act . First, the Act recognises the existence and separate roles of registered patent attorneys and legal practitioners: ss 200, 201 and 202. Secondly, both registered patent attorneys and legal practitioners may apply for or obtain patents, prepare documents for the purposes of the 1990 Patents Act and give advice (other than advice of a scientific or technical nature) about the validity or infringement of patents: ss 201 and 202 and see also Biochem Pharma Inc v Commissioner of Patents (1998) 82 FCR 87 , 92 (per Hill J). However, only a registered patent attorney (or a legal practitioner under the instruction of a registered patent attorney) may draft patent specifications or a document relating to an amendment of a specification: s 202. Finally, ss 201(8) to (11) exempt from the area of work restricted to registered patent attorneys, work done for an employer (or a company which is a member of the same group as the person's employer). Accordingly, individuals and companies may prosecute their own patent applications and draft their own patent specifications. The last principle reinforces that reg 20.3(3)(a)(ii) of the Act, properly construed, permits experience gained whilst employed by a company engaged in their own patent applications and specifications as relevant experience for the purposes of registration as a patent attorney. 30 None of those provisions support the contention that reg 20.3(3)(a)(i) and / or (ii) should be construed to include a person in the position of the Applicant as having the necessary work experience to qualify as a registered patent attorney. As noted earlier, the 1990 Patents Act clearly marks out the drafting of patent specifications as the exclusive domain of registered patent attorneys. Read in that context, that the three categories of work experience in reg 20.3(3)(a) should be directed toward the acquisition of experience in the construction and drafting of specifications is neither anomalous nor unreasonable. The Respondent submitted, and I accept, that since the 1980s a number of themes have emerged from the patents legislation and the regulations as they have existed from time to time: first, a concern with protecting the public from unqualified and inexperienced persons undertaking work in relation to patents; secondly, the introduction in the 1980s and the 1990s of increasing degrees of competition; and, thirdly, an attempt to balance those two themes: see Biochem 82 FCR 87 at 88. The balance has been achieved in three ways: (1) acknowledgement that prior to registration as a patent attorney, relevant experience may be gained in the public or private sector; (2) acknowledgement that the business of registered patent attorneys and legal practitioners overlaps but that registered patent attorneys (or legal practitioners under the instruction of a registered patent attorney) retain the exclusive right to draft patent specifications; and (3) adoption of a narrow exemption that permits persons to continue to prosecute their own patent applications or those of their employers. 32 In the early 1980s, the "employment as prescribed" requirement prior to registration was limited to employment for a period by a patent attorney. The period was six months for persons who had previously been employed in the Patents Office as an examiner for a prescribed period and, in other cases, for not less than one year: ss 133(3)(e), 134, 136(1) and (5) and 137 of the 1952 Patents Act and reg 21 of the Patent Attorneys Regulations 1954 (Cth). 33 In a report to the Minister for Science and Technology dated 29 August 1984 from the Industrial Property Advisory Committee entitled "Patents, Innovation and Competition", the Committee recommended, inter alia , that the qualifying period in employment be made a uniform period of 12 months in the public and the private sector: recommendation 39(iii). While patent applicants may prosecute their own applications before the Office, patent attorneys have the exclusive right under the Patents Act to prepare specifications for a fee, so they have an effective professional monopoly to handle patent applications. They advise clients in relation to patent validity and infringement and also deal with trade marks, industrial designs, and licensing. The care and skill with which patent applications are prepared materially influence the scope and value of the protection obtained under a patent. The drafting of patent specifications and claims requires special skill and knowledge of the applicable law and practice, as well as a capacity to understand the technology involved. No amount of legal skill will avail if the subject matter is not understood. If Australian inventors are to obtain adequate protection for their inventions here and abroad, the assistance of people possessing these attributes must be available in Australia. ... We have already commented on the important service role which patent attorneys play in preparing and filing patent applications in Australia and abroad. We believe that it is appropriate for the drafting and filing of patent specifications for reward to be the exclusive domain of a trained and regulated professional body. The work is highly technical and it is an integral part of the whole process of effective innovation. ... The Committee therefore accepts that a limited monopoly of practice by patent attorneys should be retained. (Emphasis added. These themes underpinned and continue to underpin the registration of patent attorneys. 35 The 1990 Patents Act was then introduced. A number of the Committee's recommendations were adopted by Parliament. In the context of the registration of patent attorneys, s 198 was inserted. At that time, s 198(2)(e) provided that the Commissioner of Patents was required to register a person, inter alia , who had been employed as prescribed for not less than the prescribed period by a patent attorney. Regulations 20.3(c) and (d) of the Regulations provided that for the purposes of s 198(2)(e) , the prescribed employment was limited to employment as a technical assistant in the conduct of the practice of a patent attorney in matters arising under the 1990 Patents Act or the 1952 Patents Act. The prescribed period was 1 year continuously or a period of not less than 1 year within a two year period. Sections 200 and 201 were also inserted in terms not dissimilar to the current provisions. Despite these changes, an inventor retained the right to prosecute his or her own patent application. 36 In June 1996, the Johns Committee Report was presented to the Minister for Science and Technology. Recommendation 4 - The right to draft patent specifications and claims, and prosecute patent applications (for gain) be limited to registered patent attorneys. In addition, the right to advise on patent validity and infringement be limited to patent attorneys and lawyers. Recommendation 17 - The requirement for registration as a patent attorney of one-year's experience be satisfied by experience gained in a patent attorney's employ, in a corporate environment, or in the Patents Office. Experience in other environments be recognised also for this purpose provided that the body responsible for qualifications is satisfied that it is relevant experience. Recommendation 26 - The legislation be amended to allow an employee working on patent matters of a company to act for related companies with common ownership. (Emphasis added. The Committee sought to answer the question of whether there should be unrestricted entry into the market place for patent attorney services. This involved balancing the benefits of deregulation against the costs. The comparison was not limited to the status quo versus deregulation. Other options were also identified[. ] In arriving at its recommendation to retain a regulatory regime for patent attorneys with certain modifications, the Committee has had two objectives in mind: to foster competition where it is feasible, and at the same time to safeguard the public interest. To allow unqualified persons to perform the highly specialised activity of drafting patent specifications and claims might involve unacceptably high risks. Yet in less specialised areas of patent services, competition from new entrants should be encouraged in the interests of greater efficiency and lower costs to clients. The two former activities should remain the exclusive right of registered patent attorneys. The latter should remain the exclusive right of registered patent attorneys and lawyers (see Recommendations 3 & 4). The primary reason for this relates to the commercial experience, real-time drafting, and exposure to the business systems when working in a patent attorney's office. However, the nature of experience is not specified in detail, and may be gained outside a patent attorney's office, such as being supervised by a registered patent attorney in a corporate patent office, or in a specialist area, eg., only in trademarks. Both these examples do not appear to comply with the intended aims of the mandatory one year of experience. Further, some have argued that a broader range of relevant experience should be allowable, or even mandatory. Currently, this requirement cannot be met by alternative employment experience or by passing additional examinations. Hence the existing registered patent attorney firms can effectively control the numbers of candidates who can gain registration. ... The "one-year" requirement is considered unrealistic by many, because, in practice, most candidates complete many more than one year's employment. The reality is that following appointment to a technical assistant position in a patent attorney's office it would be an exceptional candidate who could complete all the registration requirements in less than three years. It is also argued that corporate experience is often equivalent to work in a patent attorney's office. Some corporate candidates have passed all the examinations and have several years of experience in patent drafting, but cannot become registered consequent to this requirement. ... In the view of the Committee, there would be some public benefit in permitting a broader range of experience to be allowable. This would enable a slightly larger number of trainees to gain registration and thereby enhance competition in the market for patent services. The purpose of the experience is not to become proficient at patent drafting, as this should be adequately assessed by the examination. The purpose is to expose the candidate to the practicalities of the office environment. Although periods of up to 5 years were suggested to the Committee, it was considered that one year was adequate for the stated purpose. Further, as explained above, it should be permissible to gain that experience in a variety of settings, not just in a patent attorney's office. In the light of recent developments in professional training it would be desirable to replace relatively old-fashioned time-serving requirements, with a test of individual competency following a defined work program. This may not be practical in the case of the patent attorney profession. There are considerations of confidentiality of an attorney's or trainee's work that would preclude the production of a detailed portfolio of achievements. However, if the current examinations [Patent Attorney Practice, Parts I and II], achieve their desired objective, they should be close to fulfilling the demands of competency tests, in themselves. 39 In addition, the report (in Ch 7.4 at pgs 90-91) went on to recognise a particular anomaly in s 201 (as it then existed) whereby a person could draft patent specifications for their direct employer but not for a company in the same group of which the employer was a member. 40 The Applicant placed considerable emphasis on these passages in support of a wider construction of reg 20.3(a). However, neither the passages quoted nor the subsequent amendments to the patents legislation passed in 1998 support a wider construction. See also the Explanatory Memorandum to the Intellectual Property Laws Amendment Bill 1998 (Cth) and the Second Reading Speech, Official Hansard (38 th Parliament, 1 st Session, Seventh Period), Intellectual Property Laws Amendment Bill 1998 (Second Reading, 9 July 1998). 41 As the review of the historical materials makes clear, none of the changes prior to or in 1998 were directed to permitting legal practitioners who merely provide advice in intellectual property matters to satisfy the employment capacities prescribed in reg 20.3(3)(a). As the Respondent submitted, if it had been intended to broaden the pre-registration capacities to include such a person, one would have expected the regulations to have been amended to expressly refer to such a category. They do not. 42 Finally, the Applicant referred to the Trans-Tasman Mutual Recognition Act 1997 (Cth) ("the TTMRA"). In New Zealand, the requirements for registration are less onerous; a legal practitioner, upon passing the prescribed exams, is entitled to be registered as a patent attorney: s 100 of the Patents Act 1953 (NZ) and reg 154 of the Patent Regulations 1954 (NZ) (stating that legal practitioners are exempt from the employment experience requirement, which would otherwise be three years in the Patents Office, a patent attorney's practice, or other employment deemed to be suitable by the Commissioner). Upon registration, that legal practitioner is immediately entitled to be registered as a patent attorney in Australia: s 18 of the TTMRA. The Applicant submitted that the Respondent committed a jurisdictional error because he failed to interpret the 1990 Patents Act and the Regulations consistently with the New Zealand provisions and the TTMRA. That contention is without foundation. There is no principle of statutory construction which requires a court in Australia to interpret a domestic provision of the law of the Commonwealth contrary to its express words but consistently with a provision of another country which is in different terms. The fact that the New Zealand provisions are different was referred to in the Johns Committee Report (see p 110). The Committee recommended that the relevant institutions in Australia (the then Commissioner of Patents and the Institutes of Patents' Attorneys) work towards closer collaboration between the professions in the two countries and, if practical, develop a common set of qualifications for registration (Recommendation 31). All the Applicant's submission establishes is that Recommendation 31 of the Johns Committee Report has not been adopted or achieved. There is no basis for the Applicant's broader construction of Reg 20.3(3)(a), whether as alleged or all. This understanding of context and purpose does not throw doubt on the construction of reg 20.3(3)(a) such as required by the High Court in Saraswati to justify judicial amendment of a statute or regulation that departs from the ordinary meaning. The legislative and regulatory scheme has hit on a compromise whereby in-house corporate patent practice (which would tend to be focused much more on out-of-court matters such as patent drafting and prosecution), but not ordinary law firm practice (which would tend to focus more on the giving of advice with respect to court-related matters such as validity and infringement proceedings), satisfies the registration requirements. This is entirely consistent with a legislative objective of partial deregulation while ensuring that high standards are maintained with respect to the complex technical arena of patent drafting and prosecution. 44 The Applicant nevertheless submitted that if that was the object of the legislation and the Regulations, then the regulation is both over and under-inclusive. It is over-inclusive in the Applicant's submission because a person who is employed as a technical assistant for one year but spends the whole year making photocopies will nevertheless qualify for registration even though he or she has gained no experience with patent specifications. It is under-inclusive because a person who has spent a year drafting patent specifications under the supervision of a registered practitioner outside a traditional patent practice or a corporate context (eg at a university legal department) may not qualify for registration. (Whether the Respondent would or should consider a university legal department under those circumstances as a "patent attorney's practice" within the meaning of reg 20.3(3)(a)(i) is an interesting question. ) These criticisms, though not without force, do not advance the Applicant's case. Every system of rules-based credentialing, and every bright-line rule generally, suffers from the same flaws: no doubt there are many articled clerks who spend two years in a conference room reviewing documents and never learn to draft a pleading or a contract; and, no doubt, there are many 17 year-olds who are mature enough to vote (and some 19 year-olds who are not). Despite these drawbacks, bright-line rules are preferred over case-by-case decision-making in many instances because it is judged by the rule-making authority where the advantages in administrative efficiency, transparency, and certainty outweigh the disadvantages of over and under-inclusiveness. Ultimately, the Applicant's case boils down to the complaint that the Regulations are unfair and ought to be redrawn. However, the rule the Applicant seeks, whereby an Australian legal practitioner, having provided patent advice for the requisite period, is exempted from having to obtain further work experience in order to become a registered patent attorney, is a matter for government to provide for, not the courts. While the rejection of his application by the Respondent may seem unjust to the Applicant, it must be remembered in considering an application for judicial review that "the court has no jurisdiction simply to cure administrative injustice": Quin [1990] HCA 21 ; (1990) 170 CLR 1 at 36. 45 For the foregoing reasons, the Applicant's construction point fails. The Respondent accepts that he did not consider the Applicant's registration under reg 20.3(3)(a)(i). That is not surprising. He was not asked to do so. The fact that the Applicant did not ask to be registered under reg 20.3(3)(a)(i) undermines his assignment of error at both the administrative and judicial review levels. With respect to the administrative level, the rule is that the decision-maker is not obligated to make a party's case for them: Abebe v Commonwealth [2004] HCA 32 ; (1999) 197 CLR 510 at [187] . The Applicant acknowledges this rule but submits that he did make his case in his application for registration that he had "been employed as required by paragraph 198(4)(c) of the [1990 Patents] Act. " I do not accept that this general statement was sufficient to put the Respondent on notice that the Applicant was making a case under reg 20.3(3)(a)(i). I also do not accept the Applicant's submission that the "Respondent is required at law to consider each of the provisions of 20.3(3) before he can find that a person does not satisfy them. " In the absence of evidence or materials that would clearly put an administrative decision-maker on notice of an unarticulated claim, there is no affirmative burden on the decision-maker to scour the papers and the legislation sua sponte to see if there is a basis on which a party's case may succeed: NABE v Minister for Immigration and Multicultural and Indigenous Affairs (No 2) [2004] FCAFC 263 ; (2004) 144 FCR 1 at [58] - [60] ; Hill v Repatriation Commission (2005) 218 ALR 251 at [105]-[107]. I am satisfied that neither the Applicant's general statements that he had met the employment qualification nor any of the supporting materials he filed with the Respondent were such as to squarely raise his current claim that he was employed as his own (or anyone else's) technical assistant. 47 With respect to the Applicant's attempt to agitate the reg 20.3(3)(a)(i) argument in this Court, "[i]t is well recognised that the Court may allow a ground of appeal even where that ground was not raised in the Court or Tribunal below but only where all of the relevant facts have been established beyond controversy or where the point is one of construction or a point of law": SZIGW v Minister for Immigration and Citizenship [2007] FCA 203 at [13] (citations omitted; emphasis added); see also Commonwealth v Verwayen [1990] HCA 39 ; (1990) 170 CLR 394 (stating that failure to timely raise a point may be deemed waiver of that point). In the instant case, it is at best questionable whether all of the relevant facts that would establish beyond controversy that the Applicant has been employed as a technical assistant are before the Court. In particular, the record does not disclose that the Applicant has ever drafted a patent specification or prosecuted a patent (which is not surprising, given that evidence to that effect might also suggest that the Applicant had committed an offence under s 202 of the 1990 Patents Act ): cf Idoport Pty Ltd v National Australia Bank Ltd [2000] NSWSC 1141 at [31] (suggesting that a "technical assista nt" is one who has the duty of prosecuting patent applications on behalf of clients, under the supervision of a registered patent attorney). Even accepting the Applicant's statutory declaration at face value, it states only that he has "liaised with patent attorneys in relation to the preparation and filing of patent specifications on behalf of [his] clients. " Accordingly, the Applicant's claim under reg 20.3(3)(a)(i) would ordinarily fail at the outset both because it was not clearly raised below and because not all of the facts necessary to make good the point have been established beyond controversy. 48 However, the Respondent submitted that notwithstanding that he was not asked to consider the Applicant's registration under reg 20.3(3)(a)(i), he was prepared for the Amended Application to be considered by the Court on the assumption that the Applicant had made or intended to make application for registration under reg 20.3(3)(a)(i) and that the Respondent had rejected his registration on that basis. 49 As noted earlier, the Applicant's contention was limited to the assertion that he "did and is conducting the business as a patent attorney" and that the statutory declarations supplied by his firm's clients demonstrate that the tasks undertaken by him are "exactly, although on a more advanced level, those that a technical assistant would ordinarily undertake". For present purposes, I will assume what is in fact highly doubtful - that the work undertaken by the Applicant was equivalent to that of a technical assistant notwithstanding the fact that he did not himself draft or prosecute any patents. I will further assume in the Applicant's favour that the fact that his work was substantively equivalent to that of a technical assistant is sufficient to deem him a technical assistant within the meaning of the regulation even though he was not nominally a technical assistant (ie he did not hold himself out as a technical assistant nor was he retained by clients as such). 50 Proceeding on those assumptions, the immediate issue is to identify whose "patent attorney's practice" the Applicant was employed by for the purposes of reg 20.3(3)(a)(i). The Applicant appeared to contend that the patent attorney was the Applicant himself. The corollary of the Applicant's contention must be that he gained the necessary employment experience by being the technical assistant in his own practice or by supervising himself in his own patent attorney's practice. If the Applicant's construction were adopted, it would lead to the absurdity of the Applicant being both the principal and the assistant to the principal in his firm's patent attorney practice. I reject that construction. 51 Moreover, it is a construction which is inconsistent with, if not directly contrary to, the express words of the 1990 Patents Act and, in particular, ss 201 and 202 . It is at least inconsistent with s 201 when one understands that an individual employed in-house by a company engaged in research and development, whether or not the company employs a registered patent attorney, may gain experience in drafting patent applications by reason of s 201. That kind of employment provides the necessary experience. And it is a construction inconsistent with, if not directly contrary to, s 202 because it would permit a legal practitioner in a firm to obtain registration as a patent attorney when that legal practitioner (absent employment in one of the three capacities prescribed in reg 20.3(3)) cannot have received any exposure to drafting patent specifications because it is prohibited by s 202. 52 The Applicant placed considerable emphasis on the absence of the word "registered" in reg 20.3(3)(a)(i). As the Respondent submitted, the omission is "curious". However, the omission does not assist the Applicant for at least two reasons. First, as Heerey J noted in Eli Lilly & Company v Pfizer Ireland Pharmaceuticals (No 2) [2004] FCA 850 ; (2004) 137 FCR 573 at [8] , "registered patent attorneys" in s 200(2) of the 1990 Patents Act means registered in Australia. If that is correct (and it was not suggested that his Honour was wrong), the practical effect of the omission may be no more than a recognition that applicants who have worked overseas as a technical assistant for a patent attorney who is not registered under the 1990 Patents Act , may still satisfy the employment requirement of reg 20.3(3)(a)(i). Secondly, even if it were accepted that reg 20.3(3)(a)(i) is not referring to a registered patent attorney (a submission I do not accept), the Applicant would have to demonstrate that he has been employed as a technical assistant in the practice of a patent attorney, practicing as a patent attorney within the meaning of s 201 of the 1990 Patents Act . As a matter of ordinary English syntax, one cannot be employed as an assistant to oneself; thus the Applicant cannot satisfy the criterion of having been employed as a technical assistant in a patent attorney's practice. 53 The failure by the decision maker to consider this issue thus does not assist the Applicant because consideration of it would not have led to a different result: Aala [2000] FCA 57 ; 204 CLR 82 at [104] . For these additional reasons, the Applicant's construction point fails. 55 These grounds of review are also without merit, both independently and because, even if made out, they could not change the outcome in light of my conclusions on the proper construction of reg 20.3(3)(a) set out above. 56 First, the allegation that the Respondent had deleted all the relevant emails which may have clearly established bias is made without any factual foundation. That allegation fails at the outset. 57 Secondly, the Applicant submitted his application for registration on 22 June 2007. On 9 August 2007, he was not only told that he "would not appear to have been employed in any of [the] capacities" referred to in the regulations but was invited to put before the decision-maker any relevant information which attested to him meeting the requirements of reg 20.3(3). The Applicant then discussed his application with the Acting Secretary to the Professional Standards Board for Patent and Trade Mark Attorneys and, by email, she suggested the Applicant provide additional material in writing. The Applicant responded seeking a meeting with the decision-maker. That request was rejected and the Applicant was again invited to provide additional material in writing. On 24 September 2007, the Applicant supplied a detailed statutory declaration. On 4 October 2007, the Secretary to the professional Standards Board for Patent and Trade Mark Attorneys provided a memorandum to the decision maker which referred to the material supplied by the Applicant. In that memorandum, the Secretary expressed the view that the Applicant had not met the requirements for registration. He refers to being involved in cases with patent attorneys on the other side but does not appear to have provided any evidence from a registered patent attorney as to what he has done. In fact, he names some patent attorneys but does not submit letters from them --- this further contributes to the credibility gap in his claim to have done patent work. On balance, he appears to be a lawyer straying into the field of patents or involved in IP litigation. On 11 October 2007, the Applicant was refused registration for the reasons set out above (see [7]). 58 As was submitted by the Respondent, the Applicant was provided with ample opportunity to present any information concerning his application for registration. There was no denial of natural justice or a lack of procedural fairness. 59 Thirdly, there was no requirement for the Respondent to provide the Applicant with an oral hearing. Not only is there no general rule that decision makers making a decision affecting a person are bound to conduct a face to face interview or a hearing (see Zhang De Yong v Minister for Immigration, Local Government and Ethic Affairs [1993] FCA 489 ; (1993) 45 FCR 384 at 410, but the express words of reg 20.4 refer to written, not oral, forms of application. Even if, contrary to the view I have formed, the Respondent was obliged to provide the Applicant with an oral hearing (a view I reject), that oral hearing could not have produced a different result for the reasons discussed above. 60 Fourthly, the Applicant also submitted that he should have been informed of and been given an opportunity to respond to the Respondent's construction of reg 20.3(3)(a)(ii). That contention was misconceived. 61 As these reasons for decision have demonstrated, the Applicant's application for registration was refused because the material he provided was incapable of satisfying the requirements of reg 20.3(3) as a matter of law. The application was not refused based on any adverse view of the Applicant or other evidentiary issue. 62 Finally, a number of the Applicant's allegations proceeded on the basis that the Respondent was under an obligation to provide the Applicant with an opportunity to comment on documents (specifically, memoranda from the Acting Secretary of the Professional Standards Board for Patent and Trade Marks Attorneys dated 4 October and 11 October 2007) which contain no more than opinions on, or rejections of, the Applicant's material. That premise is wrong. An applicant in an administrative context is entitled to comment only on adverse information that is "credible, relevant and significant": Re Minister for Immigration and Multicultural Affairs; Ex parte Miah [2001] HCA 22 ; (2001) 206 CLR 57 at 88-90 and VEAL [2005] HCA 72 ; 225 CLR 88 at [15] and [17]. "Credible, relevant and significant" material is "information that cannot be dismissed from further consideration by the decision-maker before making the decision": VEAL [2005] HCA 72 ; 225 CLR 88 at [17] . As the Respondent's letters of 9 August 2007, 10 and 11 October 2007, and 22 November 2007 demonstrate, the Respondent took the consistent view that the Applicant did not satisfy the requirements of reg 20.3(3)(a) based on a plain reading of the regulation. There is no evidence that the Respondent could not or did not dismiss from further consideration the Acting Secretary's opinions of the Applicant's material, given that his 11 October 2007 rejection of the Applicant's application was for the same reason as his 9 August 2007 tentative rejection - namely, that even accepting that all of the material provided by the Applicant was true and correct, the Applicant failed as a matter of law to satisfy the requirements of reg 20.3(3)(a) - and did not turn on any credibility or evidentiary issues. That the Respondent had already tentatively reached that view before ever receiving the October memoranda from the Acting Secretary conclusively demonstrates that the memoranda played no part, much less a significant one, in the Respondent's consideration or decision. 63 This ground of review also fails. 65 The Applicant relied upon a document in which the Respondent placed "ticks" against three of the five names of applicants for registration as patent attorneys. The Applicant's name was one of the names listed. At the foot of the page, a sentence read, "I direct that the above names be entered in the Register of Patent Attorneys and that Certificates of Registration be issued to them". The Applicant's name was not ticked. Next to his name appeared a handwritten annotation which read "prima facie does not meet employment". 66 No decision was made to register the Applicant on 7 August 2007 because it is clear from the face of the document that the Respondent was directing only that the three persons whose names were ticked be registered while the two persons without ticks were not to be registered due to the handwritten reasons. However, even if a "decision" had been made (and it had not), the Applicant would be in no better position because the Applicant did not satisfy reg 20.3(3)(a). Any "decision" would have been a "decision" in error and without legal foundation. Accordingly, the Respondent would not have been prevented from making a later decision: Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at [51], [52] and [54]. 67 This ground of review is also without foundation. The Amended Application merely asserted apprehended bias. In fact, the Applicant sought, impermissibly, to use this ground to re-agitate the merits of the decision by reference to four matters: (1) that relevant documents were allegedly destroyed; (2) the manner in which the Applicant was described in documents by the Acting Secretary to lack credibility or have a credibility gap (without being given the opportunity to respond) and to have "strayed" into the field of patents; (3) that the Respondent's decision was described by the Acting Secretary as "judicially excellent" and (4) that the decision-maker had expressly made his thoughts known about the operation of reg 20.3(3)(a)(ii). 70 None of the considerations raised by the Applicant demonstrated that the decision of the Respondent was invalid. Many of the considerations raised by the Applicant were, in fact, an attack on the merits of the decision and were in relation to facts and matters about which the Respondent and the Applicant held different views. Further, each of the first three matters was addressed and dismissed in relation to the allegation of a denial of natural justice or a lack of procedural fairness. With respect to the fourth matter, it is well settled that the expression of a tentative conclusion without more will not support a claim of apprehended bias; a decision-maker "may form tentative opinions on matters in issue, and counsel are usually assisted by hearing those opinions and being given an opportunity to deal with them": Johnson v Johnson (2000) 201 CLR 488 at [13] (per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ). Here, the Respondent expressed his tentative opinion to the Applicant in his letter of 9 August 2007 and expressly gave the Applicant an opportunity to respond. After reviewing the Applicant's response, which presumably was assisted and focused by knowledge of the Respondent's tentative opinion, the Respondent then made his decision. Under these circumstances, I do not consider that "a fair-minded lay observer might [have] reasonably apprehend[ed] that the [decision-maker] might not bring an impartial mind to the resolution of the question the [decision-maker] [wa]s required to decide": Ebner v Official Trustee in Bankruptcy [2000] HCA 63 ; (2000) 205 CLR 337 at 344 (per Gleeson CJ, McHugh, Gummow and Hayne JJ) . 71 This ground of review fails as well. The Amended Application also identified a number of other grounds of review: see grounds 5(c), 7 and 8. The Applicant did not attempt to demonstrate an arguable error in relation to those grounds, and in the absence of any articulated argument or submission, I cannot identify any error and would treat them as also having been abandoned. 73 In the circumstances, it is appropriate to dismiss each of those grounds of review. The application is dismissed. 2. The applicant is to pay the respondent's costs of and incidental to the application. I certify that the preceding seventy-four (74) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gordon. | employment qualifications for a registered patent attorney under reg 20.3(3) of the patent regulations 1991 (cth) and s 198(4) of the patents act 1990 (cth) whether employment as a sole practitioner advising clients on patent matters constitutes "employment in a company practising in patent matters on behalf of the company" under reg 20.3(3)(a)(ii) whether a firm is a company for purposes of reg 20.3(3)(a)(ii) whether a sole practitioner may be considered a technical assistant to himself under reg 20.3(3)(a)(i) relevance of legislative purpose, context, and history when statutory text is unambiguous and plain meaning does not lead to an unreasonable result functus officio whether decision-maker may substitute new decision if earlier decision is erroneous as a matter of law natural justice whether applicant was entitled to comment on adverse opinion materials where the materials were not "credible, relevant or significant" in that they could be dismissed from further consideration apprehended bias whether administrative decision-maker may express tentative opinion prior to making final decision circumstances in which a ground not raised below may be raised on application for review "patent attorney," "registered patent attorney," "technical assistant" patents statutory interpretation judicial review words and phrases |
2 The appellant claimed to be a farmer in China who feared persecution in her own country after she protested against the local Party Secretary who, she said, had misappropriated her farmland. She said she organised protests and that she was subjected to mistreatment and persecution by the police as a result. Her further activities were said to expose her to immediate arrest. The detail of all her claims does not require further analysis because the ground upon which the appeal will be upheld is a narrow one. 3 The appellant arrived in Australia on 13 January 2007 and applied for a protection visa on 26 February 2007. A delegate of the first respondent (the Minister) decided to refuse the grant of a visa on 19 March 2007. The same day the appellant applied to the Refugee Review Tribunal ('the RRT') for review of the delegate's decision. The RRT held a hearing on 22 June 2007. She stated the sweet potatoes were planted in mid April. She stated they grew for 2 months and were harvested in mid June. She stated she planted sweet potato 5 cm apart. She stated that rice was planted in March (Spring) and took 3 and half months to grow and was harvested in mid June. She stated the peanuts were also planted in March, took four months to grow and were harvested in mid July. 5 On 17 July 2007 the RRT wrote to the appellant in a letter addressed to her authorised recipient. The letter was clearly written in order to comply with the obligations on the RRT imposed by s 424A of the Migration Act 1958 (Cth) ('the Act'). Evidence before the Tribunal suggests you should plant sweet potato 15 to 18 inches apart. This may lead the Tribunal to conclude you do not have knowledge that is consistent with the claim you planted sweet potato or that you are farmer. This may lead the Tribunal to conclude that you are not telling the truth. 8 In neither the letter to the appellant nor, later, in its decision did the RRT state the source or nature of the 'evidence' which it said was before it. I think that probably the failure to identify the nature of the evidence was itself a breach of the obligation in s 424A(1)(a) but, in light of further material to which reference will be made it is not necessary to reach a final decision about that issue. There is no doubt, however, that the issue was relevant to the RRT's deliberations and was one of the reasons why the RRT formed a view adverse to the appellant about her credibility. The applicant subsequently stated she made a mistake, she did not know the exact meaning of centimetre and she did not know how long 1 centrimetre [sic] was. The Tribunal has considered this submission however does not accept it. That is because when the Tribunal asked how far apart did she plant sweet potato, the applicant measured the distance in centimetres. The Tribunal finds that if she did not understand that word, then she would not have used it and would have measured the distance in another way. The Tribunal does not believe that the applicant has ever planted sweet potato. This leads the Tribunal to conclude she is not telling the truth about her farming experience. The Tribunal considers that this goes to the very basis of her claims that her farming land was taken and sold by the Party Secretary. It is apparent from the decision of the FMCA ( SZLIQ v Minister for Immigration and Anor [2008] FMCA 382) handed down on 19 March 2008 that the FMCA had reservations about the approach taken by the RRT but concluded that the RRT's findings of fact were effectively immune from review. In the course of its decision the FMCA identified the source of the 'evidence' to which the RRT referred in the letter of 17 July 2007. I shall set out the relevant passage in the decision of the FMCA before some further discussion of this issue. The concerns raised included the applicant's knowledge of farming, her husband's presence at the farm and her alleged leadership of the group. In relation to her knowledge of farming the Tribunal had serious concerns about the distance between each planting of sweet potatoes. The applicant stated that she had planted sweet potatoes approximately 5 centimetres apart, whereas the Tribunal, apparently relying upon a book by Alan Searle [sic], entitled "Growing Vegetables" [CB 74-75] asserted that a farmer in China would plant sweet potatoes 18 inches apart. The applicant responded in her statutory declaration that she did in fact plant the sweet potatoes between 15 and 18 inches apart and she did not know the exact meaning of a centimetre. The Tribunal does not believe that the applicant has ever planted sweet potato. This leads the Tribunal to conclude she is not telling the truth about her farming experience. The Tribunal considers this goes to the heart of what she was doing in China and goes to the very basis of her claim that her farming land was taken and sold by the party secretary. If the applicant's failure to plant sweet potatoes at the distance recommended by Mr Searle [sic] was the only ground upon which her application was to be rejected a court might have serious concerns. The author is Allan Seale. All you need to know about  Preparing the beds  Soil  Plant Foods  Mulching  Watering  Cultivation  Weed Control  Sowing Seeds  Direct Sowing  including details of thirty-eight vegetables and their individual requirements. They are propagated by placing tubers in moist soil during spring then striking pieces as cuttings when 4 to 6 inches long. They root readily in sandy soil. The plants are set out in rows 30 inches apart with 15 to 18 inches between the plants. Vines are lifted occasionally to prevent them from rooting down at the joints. Tubers are dug when plants commence to die down in winter and then stored in a cool dry place. They are ready to cook if they dry white when cut. Exuded sap and greenish black discolouration suggests immaturity. Assuming, for the moment, that s 424A(1)(a) applied, it does not appear to me that the information provided to the appellant in the letter of 17 July 2007 complied with it. Details of the source of the 'evidence' should have been given. The appellant should have had an opportunity to make some comment upon whether the source upon which the RRT relied was relevant to her claimed activities in China. I have not overlooked the fact that the appellant's response to the letter of 17 July 2007 is not to her credit. I have to accept that I actually planted sweet potato about 15 to 18 inches apart. I apologised for my mistake. I have only had 3-year education. I really did not know exact meaning of centimetre (cm)"; and I really did not know how long it would be for 1 "centimetre (cm)". That is not to the point. The obligation under s 424A , if it applied, is a strict one. 14 The issue which I have identified was not a ground relied upon by the appellant in her application for judicial review before the FMCA and it is not a ground in her appeal to this Court. However, I do not think that the issue can be overlooked. When the appeal came on for hearing, on 14 August 2008, I raised my concerns with Ms McWilliam, who appeared for the Minister. She sought, and I allowed, an opportunity to make further written submissions about the issue. 15 In the written submissions which were duly provided Ms McWilliam advanced a number of arguments in support of the contention that no jurisdictional error was committed or, at worst, any error should be regarded as inadequate to found relief as a matter of discretion. It is not necessary for me to address all the points she made, some of which are not directly concerned with the basis of my reservations about the present matter. It is well established that s 424A(3)(a) is to be construed as being directed towards general information, rather than requiring satisfaction of two separate limbs, the first being that the information is not specifically about the applicant and the second being that the information refers to a class of persons of which the applicant is a member: NAMW v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 264 at [67] - [71] , [138]. If, contrary to the first respondent's submissions, the Court determines that s 424A of the Act does apply, then there was no failure to comply with that provision, as a letter was sent to the appellant, setting out the substance of the information (AB97-98), and its relevance. The Tribunal was not obliged to either specify, or to provide to the appellant, the particular source documents relied on: see NAVM v Minister for Immigration & Multicultural and Indigenous Affairs [2004] FCA 99 at [32] - [33] . In response to a concern of the Court that the information relied on by the Tribunal may not have been applicable to farming in China, again it is well established that the choice and assessment of the information relied on by the Tribunal is a factual matter for the Tribunal alone: NAHI v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 10 at [11-13] . Any investigation as to whether there was more appropriate information on farming available which the Tribunal should have considered is tantamount to merits review, an unavailable avenue of appeal in both this Court and the Court below. at [13]-[14]; Minister for Immigration and Multicultural and Indigenous Affairs v NAMW [2004] FCAFC 264 ; (2004) 140 FCR 572 ( 'NAMW' ) esp. at [124]-[138]; WAJW v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 330 esp. at [43]-[46]; QAAC of 2004 v Refugee Review Tribunal [2005] FCAFC 92 ; and Minister for Immigration and Citizenship v SZHXF (2008) 166 FCR 298 esp. at [19]). 17 The view which has prevailed is that expressed, although for different reasons, by the majority judgments in VHAP and NAMW that what is arguably a second limb or element to be satisfied in s 424A(3)(a) is not the legislative expression of another criterion to be met but is 'designed to underline the specificity required by precluding any argument that reference to a class would be taken as a reference to all individuals falling within it' (see VHAP at [14]; NAMW at [138]). 18 I would, of course, be bound to defer to Full Court authority directly in point and obliged to respect decisions of other judges as a matter of comity. I would need to determine an appropriate and principled response to, and proper resolution of, any conflict of authority which was presented about matters I need to decide. However, in the present case none of these issues arises for consideration, much less resolution. In my view it is clear that the information upon which the RRT relied was not excluded by s 424A(3)(a) because it was neither about the appellant specifically nor about any class of which she was a member to which s 424A(3)(a) could conceivably rely. The information was not 'country information' about China. It had nothing to do with persecution on Convention grounds. It was about growing vegetables in Australian home gardens by Australian home gardeners. Its only use was to impeach the credibility of the appellant. 19 In my view, therefore, the RRT was obliged to comply with s 424A(1)(a) and (b). Failure to do so would be a jurisdictional error. I further accept the Minister's submission that the form that disclosure of material must take will depend on the nature and context of the decision. It must be borne in mind that the Tribunal is a non-judicial, inquisitorial body (i.e. there is no contradictor), with a heavy case load, which is enjoined by statute to be, inter alia, economical and quick and yet to act according to substantial justice. Tribunal members commonly draw on a body of accumulated knowledge which may encompass a large number of documents. 33. The authorities confirm that procedural fairness requires an applicant to be acquainted with the issues upon which the decision will turn, so that he or she may put a case concerning them. In protection visa decisions, that does not (at least ordinarily) require provision of, or reference to, particular documents. It is sufficient if the 'substance' of the 'information' is conveyed, so that the applicant may put arguments about its relevance or adduce whatever competing material is available to him or her. In my view, that was done in the present case. I see no basis for any assumption that there was a sufficient connection. Mr Seale's book was not identified in the delegate's decision as part of the material before the delegate. There is nothing in that decision which might have alerted the appellant to the possibility that such a publication might be used to test her claims about farming practices in China (cf SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 ; (2006) 228 CLR 152). The RRT decision does not make any reference to Mr Seale's book either. The only reference to any 'evidence' it had about the subject of planting sweet potato was given by setting out verbatim the letter written to the appellant on 17 July 2007. Nothing in the decision itself indicates how a pronouncement about growing vegetables in Australian home gardens might relate to farming practices in China. 22 In my view the substance and relevance of the information which the RRT had obtained was not disclosed and the requirements of s 424A were not thereby met. Whether or not it was appropriate, if it was to be relied on it was necessary, for reasons already explained, that it be given to the appellant. In my view it was not. The failure to do so was a jurisdictional error. The order of the FMCA will be set aside and in lieu thereof it will be ordered that the decision of the RRT handed down on 23 August 2007 is set aside and the matter is remitted to the RRT to be determined in accordance with law. The first respondent must pay the costs, if any, of the appellant before the FMCA and of this appeal. I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan. | s 424a (1) obligation to provide particulars of information relied upon substance and relevance of the information relied upon by the tribunal not disclosed to the appellant insufficient connection between the appellant's circumstances and subject matter of evidence failure to comply with requirement s 424a (3)(a) exception does not apply jurisdictional error established appeal upheld. migration |
It is necessary to record certain background information in order to understand the basis for the AWU's notice of motion. On 17 October 2008 I found that the AWU, through the actions of its delegate Joseph O'Connor (the fifth respondent), contravened s 38 of the Building and Construction Industry Improvement Act 2005 (Cth) (the BCII Act), s 170MN of the Workplace Relations Act 1996 (Cth) and the John Holland Engineering Pty Ltd New South Wales SMP Certified Agreement 2005 on two occasions, being between 15 and 18 October 2005 and 10 and 11 November 2005. I made consequential declarations and adjourned the issue of penalty for further directions and hearing. He was shouting and yelling (along with other delegates) and kicking dirt around after Mr Bryce's intervention. He called for the employees to get back on the buses. He thereby encouraged and incited other employees to stop work. On both occasions he, as AWU delegate and on his own behalf, voted in favour of the strikes. (2) In its amended defence dated 8 July 2008 the AWU pleaded various denials in response on the basis of the premise that Mr O'Connor had been at the Lake Cowal gold mine on 10 November 2005. (3) Mr O'Connor never entered an appearance and did not give evidence during the hearing. (4) During the hearing on 15 to 17 September 2008 the applicant called evidence from Mr Rosenblatt and Mr Smits about Mr O'Connor's actions at the Lake Cowal gold mine on 10 November 2005. The AWU called evidence from Mr Tocchet about Mr O'Connor's actions at the mine on 10 November 2005. These witnesses each recalled seeing Mr O'Connor at the mine on 10 November 2005 and during a meeting of employees on that day. The only differences in their evidence concerned Mr O'Connor's conduct during the meeting. These witnesses were cross-examined about where Mr O'Connor had stood during the meeting, whether he said anything during the meeting (and, if so, what he said), whether he spoke to other employees during the meeting, and whether he appeared agitated and kicked dirt around. (5) In its final submissions the AWU said that the evidence showed its members and delegate (that is, Mr O'Connor) "got caught up in the dispute" on 10 November 2005, but their actions were not such as to make the AWU liable for the industrial action. Further, that Mr Tocchet's evidence about Mr O'Connor being present at, but quiet during, the meeting on 10 November 2005 would be preferred to that of Mr Smits and Mr Rosenblatt. Secondly, in what capacity did Mr O'Connor take that action? Thirdly, were Mr O'Connor's actions within the scope of his authority as a job representative or delegate of the AWU? I thus made the finding recorded in [3] above. That annexure lists Mr O'Connor as "R & R" (that is, on rest and recreation leave) on 10 November 2005. Discovery of that document apparently prompted the AWU's notice of motion on the basis that: The applicant submitted that the AWU's motion was hopeless and without merit. There was no misapprehension of the facts as is required for Order 35 r 7(1) to be engaged ( Qantas Airways v Cameron (No 2) (1996) 68 FCR 367 at 368 per Davies J and per Lindgren J; Autodesk Inc v Dyason (No 2) [1993] HCA 6 ; (1992) 176 CLR 300 at 302 per Mason CJ). The parties conducted the entire case on the basis that Mr O'Connor was present at the mine on 10 November 2005. The AWU admitted that fact, called evidence from Mr Tocchet confirming that fact, and made submissions on the basis of that fact. Had the fact been in dispute the applicant would have called evidence from Mr Smits stating that the records system was not fool-proof and three other witnesses identifying Mr O'Connor as present on 10 November 2005. All of this evidence had been filed and served. It was not tendered because there was no dispute about Mr O'Connor being present on that day. The applicant would be prejudiced by not having called this evidence. Further, it was remarkable that the AWU had not sought leave to withdraw its admissions and had not called any evidence from Mr Tocchet or Mr O'Connor in support of the motion or, indeed, any evidence explaining why the so-called "true facts" were not ascertained before the hearing. The documents were inconclusive. They showed that Mr O'Connor was on leave without pay. They did not conclusively demonstrate that, contrary to the sworn testimony of three people (including the AWU's own witness), Mr O'Connor was not present during the meeting. As the AWU's delegate, Mr O'Connor had every reason to be at the mine site and, as he was not working, no reason to sign the "Pre-Start Form". Order 35 r 7(1) was not intended to permit the reconstruction of an entire case. I accept that I have jurisdiction to set aside or vary my judgment and orders (whether pursuant to Order 35 r 7(1) or inherent jurisdiction). However, this is not a case in which such action should be taken. The AWU's motion and submissions assumed that the "Pre-Start Form" for 10 November 2005 conclusively established that Mr O'Connor was not at the mine (and thus not present during the meeting) on 10 November 2005. It does not, and nor does the document showing that Mr O'Connor was on leave without pay on that day. The documents prove that Mr O'Connor was on leave from work on 10 November 2005 and did not sign in for work on that day. However, three witnesses (including Mr Tocchet, called by the AWU) placed Mr O'Connor at the meeting on that date. Those witnesses were cross-examined in detail about Mr O'Connor's precise actions during the meeting. They gave inconsistent evidence about his actions but consistent evidence about his presence. In these circumstances the submission that, by considering the documents, I would find that I was under a misapprehension as to the true facts is misconceived. The potential unreliability of human memory (which I accept), given the nature of the documents and the (limited) facts they are capable of proving, does not establish the AWU's case on the motion. I found that Mr O'Connor was present on, and took certain actions at, the meeting on 10 November 2005. That finding was based on a correct understanding of the pleadings, the evidence on which the parties relied, and the submissions they made. The documents do not conclusively demonstrate that the independent recollection of each of the three witnesses was wrong and thus do not indicate any misapprehension. As the applicant said, the highest the AWU's motion rises is it that the AWU now points to some potentially inconsistent evidence that the AWU might have chosen to make use of during the hearing (but for its inconsistency with Mr Tocchet's evidence) in circumstances where there is no explanation about: - (i) why the admissions were made, (ii) what attempts were made to contact Mr O'Connor to obtain instructions (because, although he has never appeared, it is apparent from an affidavit of service of Mr Jeff Robinson that Mr O'Connor is contactable), (iii) whether Mr Tocchet agrees that his evidence was wrong and why (leaving aside the evidence of Mr Smits and Mr Rosenblatt), or (iv) why the potentially inconsistent evidence was not identified as such during the hearing. In these circumstances it would be contrary to the interests of justice to make the orders sought. The AWU's motion must be dismissed. The applicant sought an order for indemnity costs on the basis that: - (i) there is no restriction on costs orders under the BCII Act, (ii) s 824 of the current Workplace Relations Act governs the issue of costs, (iii) a notice of motion is a proceeding ( Commonwealth of Australia v Construction, Forestry, Mining and Energy Union (2003) 129 FCR 271 ; [2003] FCAFC 115 at [8] ), (iv) the applicant's solicitors wrote to the AWU on 6 March 2009 inviting withdrawal of the motion with no costs order to be made and, in doing so, gave detailed reasons why the motion was misconceived, and (v) the AWU's failure to withdraw the motion in response to this offer was an unreasonable omission within the meaning of s 824(2) of the Workplace Relations Act . The AWU agreed that s 824 governed the issue of costs. However, the AWU submitted that s 824(1) was not engaged as the motion was not futile or unworthy of consideration. As to s 824(2) (on which the applicant relied), the applicant's submissions were inconsistent with Construction, Forestry, Mining & Energy Union v Australian Industrial Relations Commission (No 2) (2007) 166 IR 23 ; [2007] FCAFC 145 at [13] to [17]. The Full Court of the Federal Court, in that matter, confirmed that: - (i) a proceeding is not commenced unreasonably merely because the argument is unsuccessful, (ii) there is a distinction between an unsuccessful argument and one "so misconceived that it can be characterised as unreasonable or vexatious" (citing Paras v Public Service Body Head of the Department of Infrastructure (No 3) (2006) 152 FCR 534 ; [2006] FCA 745 at [22] ), and (iii) the general rule in industrial matters is "that parties will usually be freed from the traditional risk of an order for costs following the event" (citing Hatchett v Bowater Tutt Industries Pty Ltd (No 2) [1991] FCA 188 ; (1991) 28 FCR 324 at 326). The applicant's letter did not deal with the AWU's arguments on the motion, including the contemporaneous evidence and the failure of both parties to draw that evidence to the Court's attention. The motion was not "incompetent or unsupportable" ( Construction, Forestry, Mining & Energy Union v Clarke (2008) 170 FCR 574 ; [2008] FCAFC 143 at [29] ). The AWU's motion was not incompetent. The question is whether it was supportable. In this regard, I am satisfied the motion was misconceived (for the reasons given above), but was it "so misconceived" that the failure to withdraw the motion in the face of the letter from the applicant's solicitors was an unreasonable omission? I consider that the circumstances approach, but fall short of, the requirement for unreasonableness. Accordingly, s 824 precludes the making of a costs order. The costs associated with the BCII Act are incapable of separation and thus each party should bear its own costs of the motion. I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot. | notice of motion application to vary and set aside judgment and orders whether any misapprehension of the facts costs order whether failure to withdraw notice of motion was an unreasonable omission practice and procedure industrial law |
In his judgment, his Honour answered a series of questions which the parties had asked the court to decide separately from any other question in the proceeding. Those questions related to the alleged inconsistency between various federal industrial instruments to which the applicants are party on the one hand and the Construction Industry Long Service Leave Act 1997 (Vic) on the other. Marshall J found that no relevant inconsistency existed. The applicants wish to challenge his Honour's orders and to have that challenge resolved before it is necessary for the parties to put on evidence going to the remaining issue raised by the statement of claim, which is whether the applicants employed persons to perform construction work in the construction industry within the meaning of the State Act. The applicants have filed a draft notice of appeal. It is sufficient for present purposes to observe that the draft notice of appeal raises substantial issues relating to the interrelationship of the federal instruments and the State Act, and whether inconsistency in the constitutional sense arises between them. The respondent supports the application. It accepts that the applicants have an arguable case on the grounds contained in the draft notice. Having considered his Honour's reasons, it is my view that sufficient doubt arises as to the correctness of his decision as to warrant it being reconsidered by a Full Court: see Decor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 655 ; (1991) 33 FCR 397. The issues which the applicants wish to raise on appeal are substantial and novel. It is appropriate that they be resolved before time and expense is incurred by all parties in dealing with the other significant issue raised by the proceeding. Depending on the outcome of the appeal, it may be that this other potentially substantial aspect of the matter will not need to be dealt with. Leave to appeal will be granted. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY. | application for leave to appeal whether decision attended by sufficient doubt where issues were substantial and novel where resolution of issues may avoid the parties incurring time and expense practice and procedure |
They also sue Longreach Group Limited (Longreach Group) and Longreach Networks Pty Ltd. The QPSX parties allege breach of a licensing agreement concerning patent rights in technology used in telecommunications. Causes of action for misleading or deceptive conduct are also raised. These proceedings were commenced on 4 May 2004. The matter is complex and the interlocutory processes have been lengthy. Both parties now seek orders, differently framed, for a separate trial of liability issues. The applicants also seek orders for further discovery and for the provision of answers to interrogatories. For the reasons that follow, I will make orders for the separate trial of liability issues. I will also order limited further discovery and give leave to the applicants to administer specified interrogatories. QPSX Europe is the registered patentee of like patents in Germany. They concern a method of transmitting variable length messages on a network from a source to a destination in fixed length slots which include a header field and a message segment. They are referred to by the acronym "SAR Patents". 3 QPSX Communications is also the registered patentee of patents in the United States, Australia, Canada, the United Kingdom and Germany for a queuing protocol for a communications network for queued transmission of information in packets. They are referred to as "QP Patents". 4 It is alleged that the method which is the subject of the SAR Patents and the protocol which is the subject of the QP Patents are parts of a Distributed Queue Dual Bus technology, also known as "Queued Packet and Synchronous Exchange technology". It is said that, since 1988, the Distributed Queue Dual Bus technology has been a part of the international telecommunication standard approved by the Institute of Electrical and Electronics Engineers for metropolitan area networks known as "IEEE 802.6" ([10]). 5 A protocol known as "Asynchronous Transfer Mode" (ATM) has been developed as the networking standard for high-speed, high-capacity, voice, data, video and graphics transmission. The method the subject of the SAR Patents is said to be an element of the ATM protocol incorporated into the international ATM standard set by the International Telecommunication Union and known as ITU specification I.363.5. It is also known as AAL5. 6 According to the further amended statement of claim, QPSX Communications and Jtec Pty Ltd (Jtec) executed an agreement for the sale of certain intellectual property, a licence for the use of other intellectual property and the formation of a strategic alliance between them. This was done on 18 August 1994. The contract was amended on 5 December 1997 by agreement. 7 On or about 12 July 2001, QPSX Communications and Jtec executed a deed of assignment and variation with Ericsson Australia. By that deed Jtec assigned and transferred to Ericsson Australia, with the agreement and consent of QPSX Communications, the Jtec contract and associated covenants, representations, warranties and acknowledgements given by Jtec to QPSX Communications and vice versa. 8 It is alleged that in or about May 2003, Ericsson Australia purported to sell and the Longreach Group purported to purchase, among other things, Ericsson Australia's rights under the Jtec contract as assigned. This, it is said, enabled Longreach Group to exploit in Australia the method the subject of the SAR Patents and the protocol the subject of the QP Patents. The QPSX parties say that Ericsson Australia did not seek or obtain the prior consent of QPSX Communications to the sale as required by cl 17.1 of the Jtec contract ([29]). 9 According to [30A] of the further amended statement of claim, prior to the sale and purchase, Ericsson Australia and LME well knew that the AAL5 Standard was an international standard which supported the carriage of data in telecommunications networks and which was notorious in the telecommunications industry. They are also said to have known that QPSX Europe and QPSX Communications contended that the SAR Patents were essential patents for the purposes of components, products and systems implementing the AAL5 Standard and that there were features of the QPSX Europe SAR Patent which corresponded to the features of the AAL5 Standard. Ericsson Australia and LME are also said to have known that QPSX Europe had commenced patent infringement proceedings in Germany against Deutsche Telekom AG and Siemens AG alleging infringement by them of the QPSX Europe SAR Patent and that those proceedings included an allegation by QPSX Europe that compliance with the AAL5 Standard infringed the QPSX Europe SAR Patent. 10 The QPSX parties say that on 20 August 2003, they agreed with Ericsson Australia, through Grant Darling who was at the time its company secretary and legal counsel, that in lieu of pursuing negotiations for their consent to the assignment which was necessary for the sale and purchase to the Longreach Group, there would be negotiations for new licences. These would be with Ericsson Australia, LME and the Longreach Group. They would relate to manufacturing and sales inside and outside Australia for goods using the method the subject of the SAR Patents or the protocol the subject of the QP Patents. The Longreach Group is said to have joined in the agreements to negotiate on or about 25 or 26 August 2003. 11 The QPSX parties say that on or about 27 August 2003, Mr Darling, together with Graham Griffiths, who was at the time the chief executive officer of QPSX, and Morris Symonds, who was then the chief executive officer of the Longreach Group, executed a memorandum between the QPSX parties, the Ericsson parties and the Longreach parties ([42]). The memorandum related to the acquisition by the Longreach Group of the assets sold to it by Ericsson Australia, the replacement of patent licensing arrangements between QPSX Communications and Ericsson Australia under the Jtec contract and the further and expanded global licensing of Ericsson Australia, LME and related bodies corporate and the Longreach Group to make broad and unfettered use of the QPSX technology and patents ([43]). 12 It is alleged that Mr Darling was duly authorised to execute the memorandum on behalf of Ericsson Australia ([44]). He was also duly authorised to execute it on behalf of LME ([45]). Mr Symonds is said to have been duly authorised to execute the memorandum on behalf of that Group ([46]). 13 The QPSX parties say that the memorandum formed a legally binding agreement between themselves, Ericsson Australia, LME and Longreach Group and Longreach Networks ([49]). In the alternative, it is alleged that if Mr Darling was not authorised to execute the memorandum on behalf of LME, it formed a legally binding agreement between the QPSX parties, Ericsson Australia and the Longreach parties. 14 Material terms of the memorandum are pleaded at [51] of the further amended statement of claim. The "Defined Terms" used in the Jtec contract (as amended by the Jtec amendment contract and the assignment deed) had the same meaning in the memorandum. The term "ATM Products" means products that incorporate the QPSX Technology, in whole or in part and/or comply with AAL5 (compliance with which ATM Standard requires the use of the QPSX Patents). The reports would also include a calculation showing the amount of royalty payable to the QPSX parties and an estimate of sales in respect of different categories of ATM Products made in the previous quarter. 16 Ericsson Australia and LME jointly, and alternatively, Ericsson Australia, were also said to have agreed to pay royalties to the QPSX parties on global sales of ATM Products by Ericsson Australia, LME and its related bodies corporate on specified percentages of the Sales Value for each quarter. 17 According to the further amended statement of claim, Ericsson Australia has breached the terms of the memorandum in failing to provide reports as required and failing to make any royalty payments on the sales which it has made of ATM Products inside and outside Australia by LME, Ericsson Australia or related bodies corporate ([53]). LME is said to have similarly breached the terms of the memorandum ([54]). 18 The QPSX parties also allege that Ericsson Australia represented to them that LME had authorised Ericsson Australia and Mr Darling to negotiate and execute the memorandum on its behalf and that if he were not authorised to do so, the representation was misleading or deceptive conduct on the part of Ericsson Australia ([59]). 19 The remedies claimed include an account and payment of royalties due upon all sales covered by the memorandum ([67]). Damages are also sought in respect of the misleading or deceptive conduct. They are said to flow from the loss by the QPSX parties of an opportunity to negotiate a contract to be paid royalties by Ericsson Australia and LME. The memorandum of agreement is annexed to the further amended statement of claim. Did the first respondent, Ericsson Australia Pty Ltd ( "Ericsson" ) and the second respondent, QPSX Communications Pty Ltd ( "QPSX" ) form an agreement on 26 August 2003 being the agreement evidenced in the document entitled "Ericsson/QPSX/Hartec Limited Relationship Memorandum of Agreement" upon Ericsson signing the counterpart of that document which it received by facsimile transmission from QPSX at approximately 18:50 (EST) on 26 August 2003, and sending a copy of that signed counterpart to QPSX by facsimile transmission at approximately 19:10 (EST) on 26 August 2003 (the " 26 August agreement " )? B. If the answer to question A is yes, does the clause defining Sales Value mean the aggregate of all payments (after deducting credits or returns and excluding taxes or duties) derived and received by Ericsson as a consequence of selling ATM products? products which utilise in whole or in part "QPSX Patents" to enable them to comply with ATM standard AAL5 [ NB for the purposes of determining this question the court is not required to determine the meaning of the expression "QPSX Design"; "QPSX Chipset"; or "QPSX Patents". They would also exclude breach issues relating to royalty payments. 21 There is no doubt that the trial of all issues extending to breach and damages would give rise to a very lengthy and expensive hearing. The QPSX parties accept that there would be significant costs associated with preparing evidence concerning the amount of royalties due from the Ericsson parties if they are shown to be liable to pay them. It is also accepted that the nature of the evidence may vary according to the basis of that liability, if any. The QPSX parties accept that the assessment of any royalties due from the Ericsson parties should be deferred pending a trial on liability issues. They submit that it will be necessary for the Court to be informed about the range of products potentially covered by the memorandum. The Court will be asked to construe, inter alia, the terms "ATM Products" and "Sales Value". 22 The questions proposed by the Ericsson parties for determination have already been set out. I accept, however, as put by counsel for the QPSX parties, that the formulation of discrete questions of the kind proposed in the motion would leave the risk that there may be issues critical to liability which slip between the cracks of those questions. I also accept that the constructional questions to which the memorandum of agreement and the pleadings give rise, may be better defined and understood against the background of an understanding of the nature of the products the subject of the alleged agreement. To some extent that understanding may be able to be achieved through an agreed "primer" setting out uncontentious technical background. 23 In my opinion the preferable course is to have a trial of liability excluding questions of breach in relation to the payment of royalties. This would leave in questions of breach relating to the alleged failure to provide quarterly reports. They also sought orders that the Ericsson parties answer interrogatories in relation to a number of documents and matters pleaded in the defence. The categories of documents for which discovery is sought were reduced, as set out in amended Schedule A, to the notice of motion dated 8 November 2007. This covered classes E, F, G and J in the schedule. I am prepared to make an order for particular discovery in those terms. They submit however that if they are wrong about this there is a further matter concerning the true meaning and effect of "use" in the second limb. The QPSX parties say that the concept of how products may "use" a patented method for the purpose of complying with an external standard rather than for the purpose of assessing whether a patent has been infringed, is not particularised. The QPSX parties submit that the sense in which products "use" a patented method for the purpose of complying with an external standard "... may well mean that the product embodies the substantial idea described in the patent". They seek discovery of further documents to assist them in demonstrating the extent to which the Ericsson parties regarded products which they manufactured or sold as embodying the substantial idea described in the patent. This covers any internal analysis as to whether the method the subject of the SAR Patents is an element of the AAL5 Standard. 28 The question raised by the QPSX parties goes to the construction of the term "use" in cl 7 of the memorandum of agreement. It may be that the Ericsson parties could be asked, at some point, to make clear what construction they will be placing upon the term "use" in cl 7. It is not however, in my opinion, a question, the resolution of which will be assisted one way or the other, by internal memoranda of the kind sought in [(b)] of the broad category of documents referred to in the QPSX parties' responsive outline of submissions. Those of the interrogatories which I will allow are regarded as posed for the legitimate purpose of enabling the QPSX parties to put in certain documents as part of their case coupled with specific admissions, if they be elicited under the interrogatories. Certain of the interrogatories I will disallow as, in effect, requesting particulars which can better be pursued through that mechanism. The document purports to be a survey of "Jtec technology elements and how we think they apply to the various standards and patents. These relate to an internal memorandum entitled "QPSX/Ericsson Licence Proposal". (iii) Interrogatory 6.1. | separate trial as to liability definition of issues particular discovery interrogatories practice and procedure |
These reasons should be read in conjunction with those in Siminton (No 8). " The 60 day period expired on 18 September 2006. On that day the District Registrar ordered that Mr Siminton be granted a further 14 days within which to make payment. The extended period expired on 2 October 2006. The fine was not paid despite the fact that Mr Siminton had the financial capacity to do so, at least in part. I found that Mr Siminton's failure to make at least a part payment was wilful. 5 Mr Siminton relied on the same evidence and submissions which were advanced during the penalty hearing conducted in relation to the contempt findings which I made in Australian Prudential Regulation Authority v Siminton (No 7) [2007] FCA 1609: see Australian Prudential Regulation Authority v Siminton (No 10) [2007] FCA 1814 at [9] and [11]. This was character evidence given by two of his friends and submissions that he was impecunious but that an unnamed person might be prepared to provide him with some money to pay any fine which the Court might impose. 6 In Siminton (No 10) at [15] I identified a number of considerations which are relevant to the determination of penalties for contempt. They are derived from the authorities there referred to and I do not repeat them. I have had regard to them in dealing with this matter. 7 An additional consideration which is relevant in the present matter is that the $50,000 fine, imposed by the Full Court, was imposed in substitution for an order made by the trial judge that Mr Siminton be imprisoned for 10 weeks. The substitution was made because the copy of the Court order which had been served on Mr Siminton and which Mr Siminton had been found to have contravened, did not bear the endorsement required by O 37 r 2 of the Federal Court Rules . Such an endorsement appeared on the copy of the Full Court order which was served on Mr Siminton. • Mr Siminton has chosen not to provide evidence of his personal and financial circumstances. • Mr Siminton is an undischarged bankrupt who has failed to provide a statement of his affairs in accordance with the requirements of the Bankruptcy Act 1966 (Cth). • Mr Siminton claims to be impecunious. • Mr Siminton has a friend who might be disposed to provide an undisclosed amount of money to meet any fine which might be imposed by the Court. 10 In the circumstances I do not consider that it is appropriate to impose a penalty other than a term of imprisonment. I have determined that an appropriate penalty is imprisonment for a term of four months. 11 The District Registrar seeks an order that Mr Siminton pay her costs. In the circumstances I consider that those costs should be paid on a solicitor-client basis. 12 Counsel for Mr Siminton advised the Court that Mr Siminton proposes to file an appeal against my contempt finding and any penalty which I might impose. I will, therefore, hear the parties as to whether or not the warrant for the committal of Mr Siminton to prison should lie in the Registry of the Court until his proposed appeal has been heard and determined. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey. | penalty hearing where respondent found guilty of contempt for failure to pay a fine imposed by the full court considerations relevant to penalty penalty to reflect seriousness of the matter prison term imposed contempt |
An appeal under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) to this Court is solely "on a question of law". We expressed our approval of the observation made by Gummow J in TNT Skypak International (Aust) Pty Ltd v Commissioner of Taxation (Cth) [1988] FCA 119 ; (1988) 19 ATR 1067 at 1069-1070 that an appeal "on a question of law" is narrower than an appeal that merely involves a question of law. As his Honour pointed out, where an appeal lies "on a question of law" the subject matter of the appeal is the question or questions of law. That is, the subject matter of the appeal is the question or questions of law stated as required by O 53, r 3(2)(b). The legislature, by creating a statutory right of appeal to a party to a proceeding before the Tribunal in the narrow terms of s 44(1), disclosed an intention to limit the capacity of the Court on an appeal under s 44(1) to review factual findings of the Tribunal. An appeal pursuant to s 44(1) is thus quite different from an appeal from a judicial body under s 24 of the Federal Court Act. An appeal under s 24 is an appeal by way of rehearing (see, Poulet Frais Pty Ltd v Silver Fox Company Pty Ltd [2005] FCAFC 131 ; (2005) 220 ALR 211 at [35] - [47] ). The subject matter of an appeal under s 44(1) of the AAT Act is (shorn of the requirement to determine what, if any, entitlement to relief flows from the answer to the question or questions of law) of the same character as the subject matter of a reference of a question of law to the Court made under s 45 of the AAT Act. A mixed question of fact and law is not a question of law within the meaning of s 44(1) of the AAT Act. It is in the specification of the grounds relied upon in support of the orders sought that, in our view, one should expect to find the links between the question of law, the circumstances of the particular case and the orders sought on the appeal. The Amended Notice of Appeal asserts that the questions of law raised on the appeal are: The Administrative Appeals Tribunal did not have the power to make the decisions it did. The Administrative Appeal Tribunal created contradicting and conflicting decisions legally established by other Tribunals. The Administrative Appeals Tribunal did not have regard to the material properly before it or and readily available from the Respondent's own records or other Governmental Departments, as it is their practice in similar cases. Also failed to acknowledge the veracity and detrimental effect and consequences to the appeallant's case, since 2003, as a result of the Respondent's Officers' negligent over sighting errors. The Administrative Appeals Tribunal erred in determining statutes' pre-requisites it did. The Administrative Appeals Tribunal failed to take into consideration Mr Kenny's of the Administrative Appeals Tribunal relevant to his order of May 2003, and the member for the Administrative Appeals Tribunal failed to ascertain the fact that such an order had not been appealed against nor implemented by the Respondent. The Administrative Appeals Tribunal further failed to understand correctly Mr Kenny said decision of 2003. Also the Administrative Appeals Tribunal failed to act on its own references relevant to Mr French's comments (par 25 + 26). Wrongly exercised subjective and personal discretions the way the member of the Administrative Appeals Tribunal's did which happen to be also wrong. Failed to consider the appellant's rights emanating from the principle of estoppel, against the terms of statute. Un-orthodox approach by the Administrative Appeals Tribunal to criticise other Tribunals. Such approach was for even a decision coinciding with Member Kenny's order of May 2003. The Administrative Appeals Tribunal failed to ascertain that the matter on hand was a matter of elementary arithmetic, concerning the calculation of the already admitted liability of the lump sum of arrears owed to the applicant, by the Respondent and which already had been admitted by the Respondent. The Administrative Appeals Tribunal erred by basing and snowballing her findings on the Respondent's (self serving and erroneous) internal reviews' material since 2003. The Administrative Appeals Tribunal undertook the un-called for at law, to patronise and hypothesise of what the SSAT's decision "might have been". The Amended Notice of Appeal asserts that the questions of law raised on the appeal are: The setting aside of Senior Member M J Carstairs decision of the Administrative Appeals Tribunal given on the 26.8.08 at Brisbane but mailed on the 28.8.08 by which the Tribunal decided the setting aside that part of the Social Security Appeals Tribunal as it relates to the calculation of the rate of age pension paid to Mr Theo in the period 27 March 2002 to 9 September 2003, and reinstates the decision of the authorised review officer dated 13 November 2007, affirming the decision 4 July 2003. The implementation of the SSAT decision for the re-assessment by the Respondent of the applicant's case, and such order coincides to be the same as the one issued by Member Kenny in May 2003 being: (THEO and Secretary, Department of Family and Community Services (2003) AATA 489). The questions on the present appeal require an inquiry into the long history of litigation involving pension entitlements by the applicant. That decision was ultimately set aside by the Administrative Appeals Tribunal ("the Tribunal") on 30 May 2003: Theo v. Secretary, Department of Family and Community Services (2004) 74 ALD 460 ; [2003] AATA 489. The Tribunal determined that the applicant's aged pension had been wrongly cancelled and remitted the matter back to the respondent to calculate the amount of aged pension payable to him. On 3 July 2003, the respondent reinstated the applicant's aged pension and decided to issue an arrears payment in the amount of $11,957.03 for the period from 27 March 2002 to 1 July 2003 ("the relevant period"). By letter dated 11 July 2003, the Applicant requested a review of this decision and provided a competing calculation for the arrears payment. On 30 September 2003 the payment of arrears was recalculated. The payment was calculated on the basis of the partnered rate that existed at the various times during the relevant period. On 6 October 2003 the applicant claimed the aged pension. In support of his claim he contended that he was separated from Mrs Athina Theo. They were married on 1 November 1964. On 7 November 2003 an authorized review officer reviewed and affirmed the payment of arrears for the relevant period. The applicant subsequently sought a review of this decision to the Social Security Appeals Tribunal ("the SSAT"). By decision dated 1 April 2004 the SSAT affirmed the decision under review. The applicant then commenced proceedings in the Tribunal challenging the SSAT's decision. By decision dated 1 December 2004 the Tribunal affirmed the decisions under review including the decision in respect to the calculation of arrears for the relevant period: Theo v. Secretary, Department of Family and Community Services [2004] AATA 1273. The applicant subsequently filed an appeal to this Court. On 29 June 2005 French J. (as his Honour then was) dismissed the appeal: Theo v. Secretary, Department of Family and Community Services [2005] FCA 880. His Honour found that the Tribunal had correctly calculated the rate of payment to the applicant. Furthermore, his Honour observed that there was insufficient evidence to support any finding of the date and circumstances of the applicant's alleged separation from his wife. On 23 November 2005 the Full Federal Court dismissed the applicant's appeal from the decision of French J.: Theo v. Department of Family and Community Services [2005] FCAFC 239. By letter dated 18 September 2007, Centrelink requested information from the applicant in order to assist in making a decision in respect to his claim for age pension. Sol Theo (the applicant) and his wife, Athina Theo, were in receipt of age pension and blind pension, respectively, when Part 3.18 (Means test treatment of private companies and private trusts) of the Social Security Act 1991 (the Act) commenced operation on 1 January 2002. At various times from February to May 2002, the Centrelink officers sent letters to the applicant requesting that he provide information about his involvement in the Solon Theo Family Trust. On 12 June 2002, a delegate for the Secretary, Department of Family and Community Services (the respondent) determined that the applicant's age pension was cancelled. That decision was affirmed on 13 September 2002 by an authorised review officer (see T36) and, in turn on 25 November 2002, by the Social Security Appeals Tribunal (see T2). On 11 December 2002, the applicant sought review of that decision by the Administrative Appeals Tribunal (the Tribunal) (see T1). The information was required due to Centrelink's understanding of the involvement by the applicant as trustee and by his wife as a beneficiary of the trust. In his letter, the applicant alleged that notwithstanding the payment to him of $11,957.03 by way of arrears, he was still owed $6,408.17. This is the first hint of a claim at that rate communicated to the respondent. The AAT hearing on 1 December 2004, referred to in [11] of the background, affirmed a decision by the SSAT rejecting a contention by Mr Theo that for the period 27 March 2002 to 1 July 2003, the arrears should have been calculated using the rates which prevailed at the date of the calculation; that is, at the time of the AAT decision on 30 May 2003, Mr Theo contended that the use by the Department of the rates which applied from time to time during the period 27 March 2002 to 1 July 2003 was erroneous. His appeal against the decisions of the AAT will be dismissed with costs". At [16] of his Honour's reasons, French J set out the calculation included by the applicant in his letter dated 11 July 2003, set out above. There is, however, no reference to the basis that this is a single rate. If it could be made out it should have been put squarely to the AAT. The evidence appeared on any view insufficient to support any finding of the date and circumstances of Mr Theo's alleged separation from his wife. On 23 November 2005, the Full Federal Court (Kiefel, Jacobson and Greenwood JJ) dismissed the applicant's appeal from the decision of French J. Those entitlements had been already the subject of several reviews by the Administrative Appeals Tribunal, and appeals to the Federal Court. French J observed that Mr Theo had more squarely raised the issue of single rather than partnered rate in the appeal hearing than he had before Senior Member McCabe. However it was quite clear that Senior Member McCabe was considering the overall calculation process in the relevant period, in which one necessary step is to address whether a person is married or single. " The Senior Member then proceeded to demonstrate that "the date of effect provisions in the Social Security (Administration) Act 1999 would limit any payment at the single rate to the date when the matter was brought to Centrelink's attention". The AAT held that there was no evidence that the applicant had nominated his status as single prior to a claim in 2004. The AAT said, "It is true that he obliquely raised his single status in correspondence with Centrelink dated 11 July 2003", and the rate of $446.10 per fortnight was a reference to the then current single rate. I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender . | appeal from the administrative appeals tribunal whether the notice of appeal raises a question of law no evidence before the tribunal as to the applicant's claim no error of law in the decision demonstrated appeal dismissed administrative law |
The Tribunal had affirmed the decision of a delegate of the Minister for Immigration and Multicultural Affairs, made on 18 February 2003, to refuse grant of protection visas to the appellants. The appellants are husband and wife and their four children all of whom were apparently citizens of Lebanon at the time of their arrival in Australia on 17 August 2001. 2 In the proceedings before the Tribunal, the husband appellant claimed for himself and vicariously for his family a well-founded fear of persecution because of his involvement with anti-Syrian activities in Lebanon and his suspected involvement with the Lebanese Forces ('LF'). His claims involved being kidnapped on several occasions by Syrian Intelligence and being regularly interrogated by their officers. The husband appellant claimed that during the year 2000, he was asked to inform on LF members active in the region. At the Tribunal hearing, the wife appellant claimed also to have a well-founded fear of persecution having a similar or related fear to that of her husband. 3 The Tribunal accepted that the husband appellant was detained by Syrian Intelligence, but found that the harm occasioned to him was not for a Convention reason, the motivation for his detention being revenge or the extortion of money, and that his political activity was not the essential reason for the harassment whereof he complained. The Tribunal found that his mistreatment during the civil war had no bearing on the prospects of the husband appellant facing persecution for a Convention reason if he returned to Lebanon in the reasonably foreseeable future. 4 The Tribunal found the husband appellant's testimony regarding his claimed mistreatment in the years immediately before his departure to be vague and visited with discrepancies, and not sufficiently credible on that account. The Tribunal further found that the letters from the mayor of his village in Lebanon to be vague and not sufficiently supportive of the claims advanced. The Tribunal found further that the husband appellant lacked a well-founded fear of persecution, and further that the claims of his wife and children depended for their viability or otherwise on his claims. The Tribunal refused in the result the grant of visas to the husband and wife and their children. 5 On 14 July 2005, the appellants sought judicial review of the Tribunal's decision. On 29 August 2005, the Minister filed a notice of objection to competency on the ground that the application was not filed within the required 28 days from the making of that decision. 6 In reviewing the Tribunal's decision in light of the claims made by the appellants, the Federal Magistrate found that there was no jurisdictional error apparent which vitiated the same. In regards to a potential breach of s 424A(1) of the Migration Act 1958 (Cth) ('the Act'), her Honour found that no breach had occurred because the information under review was republished by the appellants through their submissions to the Tribunal and thus was excepted by s 424A(3)(b) of the Act. In any event, the Federal Magistrate upheld the notice of objection to competency of the Minister to the effect that the application for review of the Tribunal's decision had been filed outside the 28 day time limit and that the Court therefore had no jurisdiction to hear the application. 7 The notice of appeal filed in the Federal Court raised the following grounds for vitiation of the Tribunal's decision: 'breach of the rules of natural justice', denial of natural justice and procedural fairness, improper exercise of power, and 'that there was no evidence on other materials to justify the making of the adverse decision' of the Tribunal. No particulars of those grounds were provided. 8 On the appeal the Minister raised an additional matter not raised below: namely, 'that information provided by the wife appellant formed part of the reason for the Tribunal's ultimate decision' and that 'it could be said that information given by a member of the husband appellant's family unit (despite being a visa applicant) was not information given by the "applicant" for the purposes of the application' and, consequently, a breach of s 424A could be argued to have occurred. However, the Minister made the further submission that a similar situation to the present context was considered in MZWMQ v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1263 , in which Marshall J found that evidence given by a second applicant in a Tribunal proceedings falls within the exception provided in s 424A(3)(b). That decision was followed by Young J in Applicant M47 of 2004 v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCA 176 at [18] - [24] . I do not find that either MZWMQ or Applicant M47 are plainly wrong and, consequently, I am persuaded that the evidence given by the wife appellant is excepted under s 424A(3)(b). 9 The appellants were not legally represented at the hearing of the appeal. The husband appellant spoke for all of the appellants and could say little more than plead the wish, on behalf of himself and his family, to the brief effect '... if you could just allow me to be able to stay here within the law, nothing outside of the law'. He indicated that his three youngest children are still attending school in Australia. He spoke of his skills in repairing trucks and tractors in the context of his potential contribution to the Australian community and his desire that his children remain in Australia. 10 In my opinion, the reasons for decision of the Federal Magistrate and the Tribunal cannot be faulted jurisprudentially and the appeal must therefore be dismissed. However at the risk of being thought to be presumptuous, I would seek to recommend to the Minister that the appellants' situation be reconsidered on compassionate grounds, on the broader basis of the favourable impression conveyed by the appellant (and his wife) at the hearing, and of what I perceive to be the conceivably significant contribution that this family could well make to Australia. Of course a judicial officer's impressions from the Bench are necessarily limited by the circumstances attending the appellate curial process. Be that as it may, I was substantially impressed by the sincerity of the demeanour of the husband and wife appellants and of their plea to remain in Australia, of course along with their three school attending children. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. | whether breach established of s 424a(1) of the migration act whether evidence given by a second applicant in a tribunal proceedings falls within the exception provided in s 424a(3)(b) migration |
In that decision the learned Federal Magistrate dismissed the applicant's claim for relief against the second respondent for a breach of any provision of Pt II Div 3 of the Sex Discrimination Act 1984 (Cth) (' SD Act '). 2 As explained in the reasons for judgment of Jarrett FM, the substantive application filed by the applicant on 10 August 2004 sought orders from the Federal Magistrates Court under the Human Rights and Equal Opportunity Commission Act 1986 (Cth) (' HREOC Act ') that the respondents apologise to the applicant and pay him financial compensation in respect of alleged unlawful discrimination and sexual harassment. The application before me concerns only interlocutory relief obtained by the second respondent as a result of the orders made by Jarrett FM in his decision of 12 October 2005. 3 Limitations of time in respect of filing and serving notices of appeal of decisions of the Federal Court or the Federal Magistrates Court are found in O 52 r 15 Federal Court Rules . This was more than four months after the judgment of Jarrett FM was delivered. The applicant did not apply to the Court within 21 days of the judgment of Jarrett FM for an extension of time as permitted by O 52 r 15(2)(b). It follows that the applicant is required to seek the leave of this Court pursuant to O 52 r 15(2) to file and serve a notice of appeal. 5 However, a complication which has not been addressed by the parties in this case is that the decision of Jarrett FM pursuant to r 13.10 Federal Magistrates Court Rules 2001 ('FMCR') was an interlocutory judgment. His Honour noted himself in his reasons for decision that the application brought by the second respondent was interlocutory (par 3). That decisions of Federal Magistrates pursuant to r 13.10 FMCR are interlocutory judgments is also beyond doubt, as pointed out by Lander J in Rana v University of South Australia [2004] FCA 559 at [6] - [15] . 7 Appeals from interlocutory judgments of the Federal Magistrates Court are not as of right. Leave of a Judge or the Court is required: s 24(1A) Federal Court of Australia Act 1976 (Cth). In the case before me however, the applicant has not sought leave to appeal from the decision of Jarrett FM. 8 I shall return to the issue of leave to appeal later in this judgment. In that application the second respondent sought an order that the proceedings commenced against it by the applicant be summarily dismissed, or alternatively stayed. For the purposes of the application before him, Jarrett FM accepted all that the applicant alleged as matters of fact, including material appended to affidavits filed by the applicant (par 12). Nothing of any significance happened at that meeting 5. the first respondent attempted to contact the applicant while he was on extended leave at the commencement of the 2003 calendar year to discuss her part-time tutoring position, and a meeting was eventually arranged. At that meeting, the first respondent asked the applicant if they could be friends, and chat sometimes 6. some emails passed between the applicant and the first respondent, and in early May 2003 the first respondent insisted that they have lunch. At the lunch the first respondent hinted that they might see a film together. After the lunch the first respondent followed the applicant back to the psychology building and asked him if he wanted to 'go get a tattoo with her'. The applicant declined the offer. In my honest opinion I just think you are scared of actually getting to know someone (especially someone who is actually intelligent). I want you to outline for me all the reasons why you don't want to get to know me --- the ones below are not sufficient. In saying that you've given it a fair go, well you haven't. Maybe you feel uncomfortable with me because of your own insecurities, but really it's unfair on me (I can't help it if you are grappling with issues). I'm not asking a lot of you. If I wanted to "jump you" I would have done it a lot sooner than this. I honestly do not see why you are doing this (and I'm actually quite upset). As for persisting, well I'm not one to go down without a fight. If I wanted to make your life hell I could, but as far as things go currently, I need you to explain it in intricate detail. For once in your life stand up and be a man --- face your responsibilities. Oh and by the way --- I'm not a student doing psychology (maybe you've forgotten that) so please refrain from using that as an excuse because it's not going to stick. The applicant alleged that his response (that he had been harassed) was dismissed out of hand, and he was instructed to write a letter of apology to the first respondent without being informed of what he had been accused. The applicant wrote a letter, apologising for any hurt he may have caused the first respondent 12. the applicant met with Dr Bowey on 9 May 2003, and informed her that he was homosexual 13. on 20 May 2003 the first respondent formally complained to the second respondent that the applicant had sexually harassed her at four meetings 14. shortly thereafter, the applicant formally complained to the second respondent that the first respondent had sexually harassed him 15. on 26 May 2003 the applicant lodged a complaint of sexual harassment against the first respondent with the Anti-Discrimination Commission Queensland 16. meanwhile, the complaints of both the applicant and the first respondent were referred to the Deputy Vice-Chancellor (Academic) within the second respondent's Management of Sexual Harassment Policy. Investigation of the complaints were referred by the Deputy Vice-Chancellor (Academic) to a delegate 17. on 16 June 2003 the Anti-Discrimination Commission Queensland declined to accept the applicant's complaint 18. on 23 June 2003 the applicant made a complaint to the Human Rights and Equal Opportunity Commission ('HREOC'), directed at the first respondent and the Deputy Vice-Chancellor (Academic) of the university. The applicant marked the complaint as a sexual harassment complaint. First, the initial handling of the situation was appalling. I can believe that Ms Kennedy put on a good show for Luisa Nocella and Luisa's attitude towards me reflected a genuine belief I had done something wrong. From my own experience, I just don't think Judy Bowey reacts well in a crisis. I also take issue with the fact that the University a) failed to identify what was happening to me as sexual harassment; b) refused to treat it as such when I suggested that and c) attempted to badger me into mediation. I particularly think the repeated pressure to make me go to mediation constitutes a breach under s 105 of the Sex Discrimination Act . I had explicitly stated that I believe Ms Kennedy would only abuse mediation, using it as an opportunity to further harass me. The applicant's formal complaint was not withdrawn. The delegate investigating the complaint rejected it on the basis that: • the essence of his complaint was that the first respondent's complaint against him was sexually harassing of him because it was false and without substance, however • the lodging of a complaint against him was not capable of constituting sexual harassment of him in the relevant sense 20. the applicant was dissatisfied with the findings of the second respondent concerning his complaint 21. the applicant resigned from his position with the second respondent on 5 September 2003 22. HREOC terminated the applicant's complaint on 22 June 2004 on the basis that: • the lodging of a complaint by the first respondent was not sexual harassment in the relevant sense, and • in relation to the balance of her conduct prior to the lodging of her complaint with the second respondent --- there was no reasonable prospect of it being settled by conciliation. He complains that Ms Bowey and Ms Nocella continued to deal with the first respondent's claims "despite their possession of considerable evidence to the effect that her complaint was vexatious". 14 His Honour examined ss 5, 14, 28A, 94, 105 and 106 SD Act , and s 46PO(3) HREOC Act . 15 His Honour was not satisfied that he should dismiss the applicant's claim of unlawful discrimination against the second respondent. 16 However, having regard to the applicant's claim under s 28A SD Act , his Honour was of the view that no facts alleged by the applicant could amount to any sexual harassment of the applicant by or on behalf of the second respondent or any of its agents or employees. His Honour said that there was nothing in the facts alleged by the applicant that could possibly amount to an unwelcome sexual advance or unwelcome request for sexual favours from any of the agents or employees, or unwelcome conduct of a sexual nature towards the applicant from them (par 65). 17 His Honour also found that asking the applicant to read the first respondent's complaint of sexual harassment against him, or failing to dismiss the first respondent's complaint summarily without calling for his response, were not sexual harassment of the applicant (par 66). 18 Finally, his Honour rejected the claim of the applicant that the first respondent had sexually harassed him, and, because she was an employee of the second respondent at the relevant time, the second respondent was vicariously liable for that harassment. Although the first respondent had invited the applicant to coffee on two occasions, pizza on one occasion and a movie on a fourth occasion, there was no claim that the first respondent had subjected the applicant to an unwelcome sexual advance or made to him an unwelcome request for sexual favours (pars 68-69) • the making of a complaint of sexual harassment against the applicant to the second respondent did not in these circumstances amount to sexual harassment for the purposes of the SD Act (par 70) • while it was possible that the actions of the first respondent had constituted harassment, it was not sexual harassment in breach of the SD Act (par 70). Part II Div 3 of the SD Act deals with, and prohibits, sexual harassment as defined and contemplated by that Part. Clearly it is important that parties observe time limits set by the Rules, however a discretion is vested in the Court by O 52 r 15(2) to extend time to permit a notice of appeal to be filed in order to avoid injustice where a party has missed a prescribed deadline for filing ( Parker v The Queen [2002] FCAFC 133 at pars 10-13). The applicant must however demonstrate 'special reasons' to the Court. Such a ground is a special reason because it takes the case out of the ordinary. We do not think the use of the expression "for special reasons" implies something narrower than this. The applicant must show an 'acceptable explanation for the delay'; it must be 'fair and equitable in the circumstances' to extend time 2. action taken by the applicant, other than by way of making an application for review, is relevant to the consideration of the question whether an acceptable explanation for the delay has been furnished 3. any prejudice to the respondent in defending the proceedings that is caused by the delay is a material factor militating against the grant of an extension 4. however, the mere absence of prejudice is not enough to justify the grant of an extension 5. the merits of the substantial application are to be taken into account in considering whether an extension of time should be granted. It seemed that, notwithstanding his explanation for the delay in filing the notice of appeal, he was able to undertake other actions related to his claim. Further, his explanation does not account for the entire period of the delay. Venues of complaint include the university's internal procedures, the Anti-Discrimination Commission Queensland, HREOC, the Federal Magistrates Court and the Federal Court. The second respondent submitted that equity and fairness do not oblige the Court to subject it to another hearing on the same issues of the validity of the applicant's claims which have been dismissed. 26 I note the point raised by the second respondent, however I also note that the applicant is entitled to exercise his rights of appeal where applicable including seeking to appeal a decision of the Federal Magistrates Court adverse to him. It also claimed that the applicant is unlikely to be in a position to be able to meet any costs order arising from the costs thrown away by his delay. 28 The issue of prejudice in the context of cases involving an application for extension of time was recently discussed by Cowdroy J in Ingram-Nader v Brinks Australia Pty Ltd [2006] FCA 624 at par 16. While it is not desirable to incur costs in relation to directions hearings, it is difficult to ascertain how the second respondent has been disadvantaged in being required to attend them other than in relation to the incurring of associated costs, and general inconvenience connected with ongoing litigation. It seems from its submissions that the second respondent was aware that the applicant was continuing to pursue his claim notwithstanding the judgment of Jarrett FM. 30 In my view, although the second respondent may have experienced some prejudice as a result of the delay, it was not substantial. As I have already noted, that aspect of the claim was for sexual harassment. A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his case for determination in the appointed manner by the court with or without a jury. The fact that a transaction is intricate may not disentitle the court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious. But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process. 34 These principles represent settled law in this country. Reference was made to them recently by Kirby J in Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27 at [157] - [161] . 35 I have already referred to the reasons given by the learned Federal Magistrate for his decision. A recent case where relevant issues were discussed is Ingram-Nader . 39 It is in my view at least arguable --- as claimed by the applicant --- that the conduct of the first respondent towards him as described in the decision of Jarrett FM and outlined earlier in this judgment, did amount to sexual harassment in the sense of being unwelcome conduct of a sexual nature in relation to the applicant. In this case, I note in particular the invitations of the first respondent, the nature of those invitations, the persistence of the first respondent, and the correspondence from the first respondent to the applicant. 40 Determination of whether the first respondent had sexually harassed the applicant would have clear implications for the applicant's claim against the second respondent. 41 The applicant stated in his submissions before me that he had never intended to allege that he had been sexually harassed by employees of the second respondent, other than the first respondent. However if the actions of the first respondent did constitute sexual harassment, then two issues arise regarding the second respondent's vicarious liability for breaches of Pt II Div 3 SD Act about which submissions have been put to me. 42 First, the applicant alleges that the first respondent was an employee of the second respondent at relevant times and that the second respondent was therefore vicariously liable for her actions. In its outline of submissions in this matter before me, the second respondent stated that there did not appear to be any evidence that the first respondent was an employee of the University at the relevant time. This is clearly a key issue, to be determined in a substantive hearing of this matter. 43 Second, the applicant's submissions in relation to the failure of the second respondent to deal appropriately with his complaints arguably raise issues concerning the reasonableness of steps taken by the second respondent, which are relevant for the purposes of s 106(2) SD Act . 44 In my view it could not be said that the case before his Honour claiming a breach of Pt II Div 3 SD Act by the second respondent was (to paraphrase the words of Dixon J) so very clear as to justify the summary intervention of the court to prevent the applicant submitting his case for determination. In comparison with other cases where a claim had been dismissed pursuant to r 13.10 FMCR and subsequently considered by this Court, in my view the nature of the applicant's claim was not, for example, hopeless or doomed to failure (contra Hely J in SZFEA v Minister for Immigration and Multicultural and Indigenous Affairs (2005) FCA 634 at [6] ), or so obviously untenable that it could not possibly succeed (contra French J in Hassan v Hume (2004) FCA 886 at [27] ), or exhibiting no articulated grounds to support his assertions in relation to sexual harassment (contra the Full Court in SZBMN v Minister for Immigration and Multicultural and Indigenous Affairs (2005) FCAFC 268 at [21] ). While these principles do not represent an exhaustive list of characteristics which must be exhibited by claims in order to warrant summary dismissal, they nevertheless provide some assistance in considering the types of claims that do warrant this result. 46 However, I noted earlier in this judgment that leave to appeal from the interlocutory judgment of Jarrett FM had not been sought by the applicant pursuant to s 24(1A) Federal Court of Australia Act 1976 (Cth), and that it was necessary to do so in the circumstances. This application, and the submissions of the applicant and the respondents in this case, have been on the assumption that the sole issue in question was the extension of time for lodgment of a notice of appeal. In my view that assumption is not correct. 47 Applications for leave to appeal to the Court, like applications for an extension of time within which to institute an appeal to the Court, may be heard and determined by a single judge of this Court: s 25(2) Federal Court of Australia Act 1976 (Cth). Given the length of time which has passed since the decision of Jarrett FM in this case, it is clear that the statutory time limits for making application for leave to appeal have long expired and it would be necessary to obtain an order of the Court dispensing with the time limits (note O 52 r 5(2)(a) and r 5(3) Federal Court Rules , and comments of Lander J in Rana v University of South Australia (2004) FCA 559 par 3). 48 The principles applicable to grant of leave under s 24(1A) are reasonably well settled. With the benefit of a full appellate argument, we come to the conclusion, for the reasons we give below, that in some respects but not in others, the judgment was attended by sufficient doubt to warrant it being reconsidered; and that, in those respects, substantial injustice would result if leave were to be refused. We propose to grant leave to appeal accordingly. In my view, for the reasons I outlined earlier in this judgment in assessing the merit of the applicant's case, the decision of the learned Federal Magistrate to summarily dismiss the applicant's claim against the second respondent in respect of P II Div 3 SD Act is attended by sufficient doubt to warrant it being reconsidered. Accordingly, I am prepared to grant leave to the applicant to appeal the decision of Jarrett FM. The application for leave to file and serve out of time a notice of appeal from the decision of Jarrett FM of 12 October 2005 is granted. 2. Leave to appeal from the decision of Jarrett FM of 12 October 2005 is granted. | extension of time sought for leave to appeal principles to be applied whether delay adequately explained fairness and equity whether prejudice to the respondents merits of application whether applicant sexually harassed summary dismissal principles of summary dismissal whether case so very clear as to justify summary intervention to prevent the applicant submitting his case for determination interlocutory relief leave to appeal practice and procedure practice and procedure practice and procedure |
The Tribunal's decision, handed down on 27 July 2004, affirmed the decision of a delegate of the respondent Minister to refuse to grant the appellant a protection visa. The Tribunal's decision involved a redetermination of the appellant's claims consequent to an order for redetermination made by the Federal Magistrates Court on 15 March 2004 (see SZAIX v Minister for Immigration [2004] FMCA 104). The Tribunal had first determined the matter against the appellant in a decision handed down on 4 April 2003 which was subsequently set aside on judicial review. The Tribunal accepted that the appellant was raped on two separate occasions a few weeks before leaving Indonesia and arriving in Australia in July 2001. At the time of the first sexual assault, the appellant's attacker told her not to inform the police of his actions lest he harm her again. The appellant's father and brother nevertheless complained to the police. The appellant then moved to the home of her relatives. She claimed that she was stalked by her attacker. The second sexual assault was carried out by the same attacker and another man. The appellant claimed that her rapists were Muslim men. She also claimed they were policemen. The appellant claimed her fear of persecution arose from the rapes. The appellant claimed to fear that she will be raped again should she return to Indonesia, either by the man who raped her on both occasions, or by Muslim men. She did not press the ground argued in the Federal Magistrates Court. 4 The amended notice of appeal in substance raises three new matters. It thereby failed to ask itself the right questions when determining whether or not the appellant was owed protection obligations under section 36 of the Act. 2. Further, or in the alternative to 1(c) above, that the Tribunal failed to take into account relevant considerations when assessing whether it was reasonable to expect the appellant to relocate to another part of Indonesia. This led to a failure by the Tribunal to ask itself the right questions when determining whether or not the appellant was owed protection obligations under s 36 of the Act. 3. That by reason of the matters set out above the Tribunal committed jurisdictional error. Did the Tribunal fail to take relevant considerations into account or misunderstand the evidence concerning the appellant's claim to possess a well-founded fear of persecution as an ethnic Chinese and Christian woman? 5. Did the Tribunal misunderstand the correct test, or ask the wrong question, for determining whether reasonably effective State protection was available against the feared persecution? 6. Did the Tribunal fail to apply the correct legal test, or fail to take relevant considerations into account, on the question of the availability of State protection, in relation to future protection by the police? The appellant submitted, and the first respondent ('Minister') agreed, that where it is expedient and in the interests of justice to grant leave to raise new grounds on appeal, the Court should do so. The appellant cited VUAX v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 158 at [46] (' VUAX' ) (and the cases there cited) in support of her request for leave. 7 However, the Minister submitted that it was open to the appellant's solicitor in the Federal Magistrates Court to consider whether to raise the grounds now sought to be argued, and that the solicitor did so consider. An appeal should not become an inquiry into the quality of the legal advice received by a party at first instance. The Minister directed the Court's attention to paragraphs [16]-[18] of the Full Court's decision in Iyer v Minister for Immigration & Multicultural Affairs [2000] FCA 1788 (' Iyer '), in which the Full Court canvassed relevant authorities on this issue. However, where all the facts have been established beyond controversy or where the point is one of construction or of law, then it is a question for the Court of Appeal whether it is expedient and in the interests of justice to entertain the point (the second proposition). Lord Watson in Connecticut [ Fire Insurance Co v Cavanaugh [1892] AC 473] at 480 said that in the case of the second proposition "it is not only competent but expedient in the interests of justice, to entertain the plea". The rule derives, at least in part, "from public policy considerations directed to ensuring the finality of litigation" and, so far as it does so derive, "the relevant consideration is that the case sought to be made on appeal is a new or different case from that which emerged at the trial": Banque Commerciale SA [(En liq) v Akhil Holdings Ltd [1990] HCA 11 ; (1990) 169 CLR 279] at 284. In addition, the Court should have regard to the protection of the 'structure and integrity of the appellate process' (see Iyer at [23]), to which it is relevant, though not determinative, that the appellant failed to comply with Court deadlines for providing reasons why the grounds were not raised below, and particulars of the arguments relied upon. 9 The appellant argued that her request for leave is supported by these factors: the facts are not in dispute and there is no possible need to admit new evidence for the new grounds (as in Coulton v Holcombe [1986] HCA 33 ; (1986) 162 CLR 1) (' Coulton '); granting leave would not be an effective grant of a new trial (also as in Coulton ); and the new grounds raised were involved as parts of the appellant's claim before the Tribunal. She referred to Jones , where, as here, there was an express disavowal of grounds by the relevant legal representative, but the Court nevertheless granted the appellant leave to raise new grounds. 10 At the hearing, counsel for the appellant relied on Queensland v J L Holdings Pty Limited [1997] HCA 1 ; (1997) 189 CLR 146, suggesting that it is authority for the principle that the requirements of case management are relevant considerations, but they cannot be used to prevent a party from arguing a ground that is fairly arguable. Further, counsel suggested that there is a level of disagreement in this Court regarding the approach to be taken to this issue. In doing so, counsel referred to the judgment of Allsop J in Branir v Owston Nominees (No 2) [2001] FCA 1833 ; (2001) 117 FCR 424 at 440, in which his Honour expressly declined to comment on the approach taken by Branson and Katz JJ in H v Minister for Immigration and Multicultural Affairs (2000) 63 ALD 43. In that case, their Honours gave consideration to the merits of the new grounds to be raised. On this point, counsel also referred to the discussion in VUAX at [48] where, it appears, the Full Court accepted that the merits of the new grounds are to be given consideration. The appellant argued that a party should be permitted to raise an arguable case provided any prejudice to other parties could be compensated by costs. In addition, the appellant referred to the judgment of R D Nicholson J in Jones , where his Honour stated (at 48) that whether or not the Immigration Review Tribunal had complied with its statutory duty 'raises a point of law in the interests of justice which supports and outweighs, in all the circumstances, the public interest in the finality of litigation in these particular circumstances'. Jenkinson J (with whom Carr J agreed) similarly stated (at 37) that the '[o]bservance of such [statutory] requirements by a tribunal administering important and publicly scrutinised immigration laws should be encouraged by this Court. A determination whether...the Tribunal satisfied those requirements is in my opinion expedient and in the interests of justice. An appellant wishing to raise fresh legal questions cannot, in the first place, be in a worse position than one seeking to augment the evidence itself. Secondly, a party victorious at first instance is, in any case, liable to be defeated by a change in the law occurring before the appeal is heard; that, indeed, is conventionally given as the main practical difference between a "strict" appeal and one by way of rehearing. The result of a new legal point being successfully raised is no harder for the litigant thereby defeated than if the defeat follows from some legal point newly raised. Thirdly, however, there is undoubtedly great, general value in considerations of finality of litigation acting as a brake on appellate intervention, thereby preserving the integrity of the trial as the normal arena for final disposition of that case. As a general statement of principle there is no conflict between what the Full Court approved in Branir and the approach in the cases next referred to. If it were not so the main arena for the settlement of disputes would move from the court of first instance to the appellate court, tending to reduce the proceedings in the former court to little more than a preliminary skirmish. The Court may grant leave if some point that was not taken below, but which clearly has merit, is advanced, and there is no real prejudice to the respondent in permitting it to be agitated. Where, however, there is no adequate explanation for the failure to take the point, and it seems to be of doubtful merit, leave should generally be refused. " (Emphasis added. That does not mean that an appellate court should enter upon a full consideration of the grounds. To do so would make the requirement for leave meaningless. It is sufficient to determine whether the grounds sought to be raised have a reasonable prospect of success. We also consider it appropriate to take into account whether the appellant had the benefit of legal representation at the hearing before the primary judge . " (Emphasis added. ' (Original emphasis). The Tribunal further accepted that 'ethnic Chinese women' in Indonesia are a particular social group within the Convention's meaning. 14 However, the Tribunal was not satisfied that the appellant was raped for reasons of her membership of that group. Nor was the Tribunal satisfied that the appellant's fear of future persecution was for this reason. The Tribunal accepted that riots which took place in Indonesia in 1998 were marked by mass rape of ethnic Chinese women but found that the independent sources it consulted 'do not suggest' that the targeting of ethnic Chinese women persisted beyond the 1998 riots. It concluded that there was 'no evidence' to suggest that ethnic Chinese women are singled out for sexual assault. The Tribunal found that the 'prevalent and indiscriminate nature of such [sexual] attacks suggests that these attacks are opportunistic crimes committed for individualistic reasons against women perceived to be suitable victims'. It found there 'was nothing in the [appellant's] evidence' to lead it to conclude that in committing the rapes, the appellant's attackers were 'essentially and significantly motivated by her membership of the particular social group of ethnic Chinese women'. The Tribunal has already found that the [appellant] was not attacked for the reason of her religion, ethnicity or membership of a particular social group. The [appellant's] evidence at the hearing regarding the reasons as to why her attacker would want to harm her now was unambiguous. She stated that that the man wants to harm her because he was upset that her father had reported the matter to the police and he wants to take revenge. When she was asked again if the man wanted to harm her in retaliation for her father's complaint, she said yes. In the Tribunal's view, the essential and significant reason for the harm feared by the [appellant] is personal, namely revenge or retaliation for her father's complaint to the police and not any Convention related reason. The Tribunal finds that the harm feared by the [appellant] is not Convention related [sic]. Whilst the Tribunal had said there was 'no evidence' to suggest that ethnic Chinese women in Indonesia are singled out for sexual assault, it did accept there was a 'general vulnerability felt by the ethnic Chinese Christians in Indonesia'. In light of this acceptance, the Tribunal was obliged to deal with the appellant's claim that ethnic Chinese are likely to be targets of violence, and the evidence in support of that claim. There was evidence that, although government administrations have been more benevolent towards ethnic Chinese since 1998, ethnic Chinese, and Christians, have been targets of violence since that time. The appellant submitted that the Tribunal jurisdictionally erred by not making findings on that evidence (which included a suggestion that Chinese women frequently wore chastity belts, such was their fear of rape), and thereby not considering it relevant in reaching its conclusion on this part of her claim. 17 In concluding that there was no evidence to support a finding that ethnic Chinese women were singled out for sexual assault, the Tribunal referred to evidence submitted by the appellant that according to a non-government organisation 'sexual violence, including rape, mostly against women and children, could take place anywhere and involve anyone regardless of walk of life, education or age'. The appellant submitted that this did not undermine her claim: evidence that many women in Indonesia are at risk of rape does not deny that ethnic Chinese women may possess a well-founded fear of rape on grounds of their being ethnic Chinese. 18 In response, the Minister argued two things. First, that the Court should not read literally the Tribunal's use of the phrase 'no evidence': reading the Tribunal's reasons reasonably beneficially, it is clear enough that the Tribunal meant that there was no evidence it found convincing. Second, and perhaps more importantly, that the validity of the intended ground of the appellant's appeal is immaterial, given that the Tribunal concluded that the essential and significant reason for the future harm feared by the appellant was not related to a Convention reason but was personal: she fears that she will be harmed again by her attacker in revenge for her father's complaint to the police. 19 In my opinion, given the Tribunal's factual findings the Minister's submissions must be upheld. In the first place, the Tribunal's finding as to the true nature of the appellant's fear was a free-standing and sufficient reason to reject her claim to refugee status. (There is a qualification to this as to the claim that, at street level, no adequate State protection via the police is available to the appellant, the lack being attributable to Convention reasons, but this is dealt with below). On that finding, the persecution she feared was not for a Convention reason --- the Tribunal member rejected the hypothesis that the appellant was attacked because she was Chinese. It follows that she could not have been attacked because she was a member of the social group, ethnic Chinese women, found by the Tribunal to exist. 20 Secondly, read as a whole, and beneficially, the Tribunal's reasons sufficiently indicate that by 'no evidence' the Tribunal meant 'no sufficient reason'. Such an assessment was legally within the Tribunal's province. 21 Thirdly, it is now trite that the Tribunal was only required to refer to the evidence it found persuasive and not to explain its rejection of each other piece of evidence. The Tribunal found that women in Indonesia did not constitute a particular social group within the Convention's meaning. The appellant argued that the Tribunal misunderstood the legal test for a 'particular social group'. 23 The Tribunal found that whilst the evidence 'indicates that violence against women in Indonesia is pervasive and women face considerable discrimination in the work place' it also 'suggests Indonesian women are active participants in Indonesian society'. The Tribunal found that Indonesian women participate in education, the work force and politics. Based on a 'country report' from the State Department of the United States of America, the Tribunal stated that whilst the Indonesian Guidelines of State Policy and legal statutes adopted by the MPR (People's Consultative Assembly) state that women's participation in the development process must not conflict with their role in improving family welfare and the education of the younger generation, the Guidelines explicitly state that women have the same rights, obligations, and opportunities as men. The Tribunal then concluded that women in Indonesia are not a particular social group within the meaning of the Convention. Nowhere in the section of the Tribunal's decision headed 'Findings and Reasons' did the Tribunal expressly refer to the question of whether Indonesian women are cohesive or share interests, goals or aspirations. The Tribunal did however, in the course of recording the evidence later referred to by it in its 'Findings and Reasons' on the question of 'a particular social group', record that the appellant was invited at the hearing to comment on the assertion that Indonesian women did not share interests, goals or aspirations but did not so comment. Secondly, the characteristic or attribute common to all members of the group cannot be the shared fear of persecution. Thirdly, the possession of that characteristic or attribute must distinguish the group from society at large. Borrowing the language of Dawson J in Applicant A , a group that fulfils the first two propositions, but not the third, is merely a "social group" and not a "particular social group". ' (Footnotes omitted. However, she argued that the Tribunal manifestly misunderstood that approach. The appellant submitted that the written reasons of the Tribunal demonstrate that in considering the third matter identified in the quote from Applicant S above (ie whether the social group was distinguishable from the rest of society), the Tribunal actually tested whether women in Indonesia were cohesive or 'share interests, goals or aspirations'. The appellant pointed out that cohesiveness is not a necessary element of a particular social group; thus the Tribunal misunderstood the test to be applied. The Minister argued that the Tribunal's written reasons on 'a particular social group' demonstrate that the Tribunal gave significance to the integration of women into civil society and the conferral on them of the same rights and obligations as men, and not the cohesiveness or otherwise of Indonesian women as a social group. 26 A fair reading of the Tribunal's reasons as a whole does not leave me with the impression that the Tribunal, under cover of silence, applied a test of whether women in Indonesian were cohesive or shared interests, goals or aspirations. Decision-makers, including judges, often raise issues and considerations in the course of a hearing that ultimately do not form part of their reasoning. So it was, in my opinion, here. 27 Further, the appellant is faced with the problem that the Tribunal concluded that the information it accepted 'does not indicate that perpetrators of sexual assault in Indonesia engage in this form of abhorrent criminal activity as a means of harming or persecuting ethnic Chinese women (or women) per se for that matter ' (the emphasis is mine but the punctuation is as in the original). Thereby, notwithstanding its finding that women in Indonesia are not a particular social group, the Tribunal appears to have concluded that, if they were, perpetrators of sexual assault do not commit their crimes as a matter of persecuting women as such. The appellant asserts that the parenthetical 'allusion' to women in the Tribunal's conclusion is not sufficient to constitute a finding on this question, but I see no reason to read down what the Tribunal Member clearly enough said. The mispunctuation leads nowhere. According to the US State Department, in 2003 there was a 25 percent increase in the rape cases tallied by the Jakarta police. Rape is punishable by 4 to 12 years in jail, and the Government jailed perpetrators for rape and attempted rape. During 2003, many police stations set up a "special crisis room" (RPK), where female officers received criminal reports from sexual assault victims. There is an active NGO movement in the country which is constantly raising awareness and assists in police in addressing the problem of sexual assault [sic] '. It referred to evidence that recently a police chief in West Jakarta was replaced for allegedly blackmailing traders of traditional Chinese medicines. The Tribunal said that '[t]here was nothing in the independent evidence to satisfy the Tribunal that the [appellant] will be denied state protection for the reason of her ethnicity, religion or her membership of a particular social group of "ethnic Chinese women in Indonesia". ' The Tribunal was 'satisfied that if the [appellant] were to face harm from private individuals, adequate and effective state protection is available to her'. 30 The appellant submitted that, even if, upon analysis, she feared persecution only by a non-State actor for non-Convention reasons, the Tribunal erred by failing to consider whether there had been a failure by the Indonesian authorities, for Convention reasons, to provide protection to her. The appellant relied on the observation in Minister for Immigration and Multicultural Affairs v Respondents S152/2003 (2004) 205 ALR 487 (' S152 ') that a state's inability to control the conduct of its police force may amount to a sufficient reason for a person to be unwilling to avail herself of the protection of her country of nationality once outside the country. That, however, assumes that a Convention reason is implicated. In oral submissions, the appellant submitted that, had the Tribunal applied the correct test, it would have been open to it to conclude that the failure by the authorities to protect the appellant was for a Convention reason: the High Court's decision in Minister for Immigration and Multicultural Affairs v Khawar [2002] HCA 14 ; (2002) 210 CLR 1 (' Khawar ') is authority for the proposition that criminal activity committed by a private individual, which is tolerated or condoned by the State because it systematically discriminates on Convention grounds, may amount to persecution. 31 In considering whether effective state protection was available, the appellant submitted that the Tribunal was required to consider whether there was a reasonably effective and impartial police force and a reasonably impartial system of justice: see S152 at [26]. The appellant argued that the Tribunal's reasoning reveals no consideration of whether effective state protection was available to the appellant 'on the ground' or at a 'micro' level, as was required: the question was, what would be available as a practical matter to a woman in the position of the appellant? 32 The appellant submitted that, had the Tribunal really questioned whether there was an effective and impartial police force and a reasonably impartial system of justice, as required by S152 , it would have dealt with the suggestion by the appellant's father that the police had not responded to his complaint of his daughter's rape because she is Chinese, and that the appellant was raped again after the complaint. 33 The Minister conceded that the evidence dealt with by the Tribunal on the issue of state protection consisted of 'broad' considerations of what the state was attempting to do to remedy the problems of rape in Indonesia. However, the Minister submitted, that does not betoken jurisdictional error. The Tribunal was under no obligation to recite every piece of evidence before it, and especially not required to recite evidence it found unconvincing on an issue. The Tribunal's conclusion that the Indonesian authorities do not 'generally' withhold protection should not be 'parsed' in order to concoct supposed error: Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259 at 272. The Convention does not require absolute protection or guarantees against harm, as was correctly observed by the Tribunal in reaching its conclusion on the issue. 34 The Minister further argued that in a case of persecution by non-state agents the question of state protection may be relevant at three stages of the inquiry: whether the fear is well-founded; whether the conduct giving rise to the fear is persecution, and; whether the appellant is unable, or, owing to fear of persecution, unwilling, to avail herself of the protection of her state: S152 per Gleeson CJ, Hayne and Heydon JJ at [21]. It was for this reason that the High Court allowed an appeal from the judgment of the Full Court of the Federal Court in S152 that turned on a finding, similar to the appellant's argument in this appeal, that the Tribunal erred in failing to determine whether there was protection available 'in a practical sense'. 35 However, while the 'ability of the state to discharge its obligation to protect its citizens', may , as counsel for the Minister submitted, be relevant at three stages of the inquiry, it is here, in my view, relevant to the second question identified by Gleeson CJ, Hayne and Heydon JJ, viz 'whether the conduct giving rise to the fear is persecution' (at [21]). If the state, despite the good intentions of its leaders, is not able, at what might be called the operational or grass-roots level, to have its operatives provide an acceptable level of protection against serious harm, and the dereliction of those operatives has as its basis their discrimination of a Convention kind against the appellant, that situation, as Hale LJ put it in Horvath v Secretary of State for the Home Department [2000] 1 NLR 15, 'may turn the acts of others [ie non-state actors] into persecution for a Convention reason' (at 52 and quoted with approval by Lord Hope of Craighead in the appeal to the House of Lords (see [2000] UKHL 37 ; [2001] 1 AC 489 at 497)). 36 So much was uncontroversial in S152 . S152 was a case where harm had been inflicted by non-state actors for Convention reasons. Day by day, Australian courts deal with criminal cases involving violent attacks on person or property. Some of them may occur for reasons of racial or religious intolerance. The religious activities in which the first respondent engaged ... evidently aroused the anger of some other people. Their response was unlawful. The Ukrainian state was obliged to take reasonable measures to protect the lives and safety of its citizens, and those measures would include an appropriate criminal law, and the provision of a reasonably effective and impartial police force and justice system. None of the country information before the tribunal justified a conclusion that there was a failure on the part of Ukraine to conform to its obligations in that respect. That is, the State's weakness or incompetence, whatever its leaders' good intention, in having its norms carried out, might have permitted the local police to engage in Convention persecution themselves, by failure (for Convention reasons) to prevent and act against those who would cause the appellant serious harm. 38 As I read S152 , nothing in it, or otherwise in principle, denies that such a claim, if made out, may constitute the appellant a refugee. She would be in her predicament because of the risk of serious harm coming to her for a Convention reason. Attribution of the Convention ground to the applicant by the state or non-governmental agent of persecution is sufficient to establish the required causal connection. ' (See: Hathaway, 'The Michigan Guidelines on Nexus to a Convention Ground', Michigan Journal of International Law (2002) vol 23, pp 211-222 at 215. Persecution may also result from the combined effect of the conduct of private individuals and the state or its agents; and a relevant form of state conduct may be tolerance or condonation of the inflicting of serious harm in circumstances where the state has a duty to provide protection against such harm. As was noted earlier, this is not a case in which it is necessary to deal with mere inability to provide protection; this is a case of alleged tolerance and condonation. In Ex parte Shah , Lord Hoffmann, in giving the example of the Jewish shopkeeper set upon with impunity by business rivals in Nazi Germany, referred to the failure of the authorities to provide protection, based upon race, as an "element in the persecution". The same expression was used by Lord Hope of Craighead in the passage from Horvath quoted above. In relation to the case which Ms Khawar seeks to make out, the decision in Ex parte Shah in this respect is directly in point. If her contentions, as to which no findings have yet been made, are correct, then Ms Khawar was being abused by her husband and his relatives for personal reasons, but her likely subjection to further abuse without state protection is by reason of her membership of a particular social group , if it be the case that women in Pakistan may be so described. ' (Footnotes omitted, emphasis added. 41 S152 effected no modification of Khawar . In my opinion it was. 43 The Tribunal had before it material from the appellant's father which she and her father had wished to have considered by the relevant Australian authorities. Her father suggested that he was treated differently and less favourably, when he complained, by the local police, Muslims, because he was Chinese. It was elsewhere asserted in the materials relied on by the appellant that all the police are Muslims. The Refugee Advice and Casework Service (Australia) Inc ('RACS') had submitted on behalf of the appellant that she 'fears that the police and authorities in Indonesia will not protect her because of the fact she is a Christian Chinese...'. Her solicitor had also submitted that the appellant's father had provided a statement detailing his experience with the police: 'He reported the matter to the police who took no action, he opined that it was due to the fact that he and his daughter were Chinese whereas the police and the rapist were Muslim. ' The appellant's solicitor, citing Khawar (at [29]), submitted that '[o]n its face, this is a further case of persecution. Even if the original rape was not for a convention reason, the failure of the authorities to investigate and take action in respect of the rape can amount to persecution if such inaction was motivated by questions of race. ' The Tribunal Member who first heard the appellant's case recorded that the appellant had 'also stated that her father and brother had reported the assault to the police but they took no action. The Indonesian authorities were not interested in protecting her. ' The Tribunal Member asked the appellant 'how, in her view, the police could have done anything without more information. ' According to the Member, the appellant did not respond to that question, but 'reiterated that the complaint was ignored because she was of Chinese descent so was ignored. There were fights between Muslims and Chinese Christians. It was also apparently accepted, at least, that the appellant had been raped; that this had been reported to the police; that they had, at best, done nothing useful directed towards apprehending the rapist, and that she had been raped again by the same man on account of the complaint to the police. 45 In such circumstances, it behoved the Tribunal, in light of the several ways in which the appellant put her case, to examine whether the appellant might qualify for refugee status. There is nothing abstruse or indirect in the proposition, which readily springs to mind, that despite anti-racist sentiments expressed and progress initiated at the highest levels of government, these may have had little effect at local police level. 46 This question should have been considered but was not. ... During 2003, many police stations set up a "special crisis room" (RPK), where female officers received criminal reports from sexual assault victims. There is an active NGO movement in the country which is constantly raising awareness and assists in police addressing the problem of sexual assault [sic] . The Tribunal notes that according to the US Department of State recently a police chief in West Jakarta was replaced for allegedly blackmailing traders of traditional Chinese medicines (see for example Country Reports on Human Rights Practices --- 2003, released by Bureau of Democracy, Human Rights and labour, US Department of State, February 2004). The Tribunal is satisfied that if the [appellant] were to face harm from private individuals, adequate and effective state protection is available to her. The Convention does not require absolute protection of an individual and state protection by no means implies that the authorities must or can provide absolute guarantees against harm ( Minister for Immigration & Multicultural Affairs v Respondents S157/2003 [2004] HCA 18 at [26] and [28]). There was nothing in the independent evidence to satisfy the Tribunal that the [appellant] will be denied state protection for the reason of her ethnicity, religion or her membership of a particular social group of "ethnic Chinese women in Indonesia". That question is distinct from whether at high levels or in other places in Indonesia the authorities were generally doing their reasonable, non-racist best. Material from her father and from the appellant supported the proposition that the police at local level would treat her less favourably than indigenous Indonesians. The extent to which actual and practical, as distinct from legal, discrimination might operate against Chinese people, including women complaining of rape, appears to have provoked little, if any information at all as a result of the Tribunal's inquiries. It appears not to have been, as it should have been, an actual focus of those inquiries. 49 Plainly the appellant's complaint about the local police, in the context of much material to suggest deep wells of anti-Chinese feeling in Muslim Indonesia, was not answered merely by reference to changes for the better at high levels of public administration in Indonesia since the departure of President Soeharto. That the contemporary leaders of a society have enlightened views may say nothing about the situation at the level of grass-roots policing. Nor was it answered, as the Minister submitted, by reference to measures, apparently instituted in some localities, to address the general problem of rape by 'identifying the problem of under-reporting and establishing crisis centres'. The official encouragement of the reporting of rapes generally carries no implication that subsequent investigation would proceed on a basis that was not ethnically discriminatory. Encouragement of Indonesians generally to report rape to local police is one thing, the investigation by local police of reports by Chinese Indonesians is another. 50 The unexamined question was, in my opinion, sufficiently clearly an integer of her case to require consideration. If it was not clearly and expressly so asserted in the ways referred to at [44] above, in my view it clearly arose on the materials before the Tribunal. The tribunal's obligation is not limited to procedural fairness in responding to expressly articulated claims but, as is apparent from Dranichnikov , extends to reviewing the delegate's decision on the basis of all the materials before it. It is not likely that the Full Court in NABE intended such a thing. The Full Court was absolving the Tribunal from any duty to engage in subtle teasing out of hypotheses that only abstrusely arise from an applicant's account of the circumstances that have led to the claim of refugee status. That is not the position here. 52 In my opinion, nothing in NABE was intended to deny, nor can it be denied, that to determine whether a claim 'clearly arises' on the material before a decision-maker, the decision-maker must fully understand the claim being made. That, in turn, may in some cases make it necessary for the decision-maker to analyse what the appellant has said in terms of possible Convention categories. That was the position here. 53 In my opinion, failure to consider this matter constituted a constructive failure to exercise the Tribunal's jurisdiction. 54 Nevertheless, whether such error ultimately has the effect of invalidating the Tribunal's decision depends on whether there was otherwise an independent, jurisdictionally robust basis, among those found by the Tribunal, for denying the appellant's claim. In particular, the finding that the appellant feared persecution at the hands of one local man and that the appellant could avoid such threat as he might pose by relocating elsewhere in Indonesia is of potential significance here. The focus of the Convention definition is not upon the protection that the country of nationality might be able to provide in some particular region, but upon a more general notion of protection by that country. The international community is not under an obligation to provide protection outside the borders of the country of nationality if real protection can be found within those borders. Therefore, even if an applicant has a well-founded fear of persecution in their home region, the Convention does not provide protection if they could nevertheless avail themselves of the real protection of their country of nationality elsewhere within that country: Randhawa ... per Black CJ at 440-1. The Tribunal does not accept that the man who assaulted her, although he may have persisted in locating her in Jakarta, would be able to find her anywhere in a densely populated country like Indonesia. When the option of relocation was discussed with the [appellant] at the hearing, she stated that her husband had died, she was defrauded financially and most of her relatives are in Australia. While the Tribunal appreciates that the death of her husband in January 2001 and being financially defrauded soon after made life difficult for her, the [appellant] continued to work as [a real estate] agent until her departure from Indonesia. She also possesses skills as a hairdresser and worked in that profession for many years. In Australia, she was able to work until she was detained and has been able to find resourceful friends who have assisted her throughout her ordeal. The Tribunal did not find her to be as dependent as her witness tried to portray her. She is relatively young, she was working in Indonesia prior to her departure and she has gained additional skills in Australia which would assist her if she were to search for employment opportunities elsewhere in Indonesia. The Tribunal finds that it is reasonable for the [appellant] to relocate internally. The question is whether the person can relocate to another area of the country, and, it is said, whether he or she could reasonably be expected to do so. The Tribunal did not advert to the fact that all of the appellant's relatives living in Indonesia live in Cenkarang. These are probable issues for the appellant, who would effectively be without family support. In oral submissions counsel added that the Tribunal did not take into account that the appellant may have her children with her if she relocates, unlike her experience in Australia, which had encouraged the Tribunal to regard her as a relatively resilient person. 59 The Minister denied the claim that the Tribunal merely assumed there was a safe haven within Indonesia, and argued that it is for the Tribunal to determine the significant issues in assessing the matter of relocation. It cannot be assumed that, because the Tribunal has failed to refer expressly to an issue, it has failed to consider it. The proper inference is that the issues referred to by counsel for the appellant were not considered by the Tribunal to be as significant as those the Tribunal mentioned. Also, of the issues listed by the appellant's counsel, factors (1) and (3) go to whether the appellant would want to live in Indonesia at all, rather than to whether she could relocate. Issues (2) and (5) concern the appellant's wish to have family support, which was acknowledged by the Tribunal, and issue (4) could properly be considered not to carry great weight, given that the appellant had successfully made her way in the unfamiliar cultural environment in Australia. The brevity, it was submitted, of the Tribunal's reasons on this matter 'does not detract from the breadth of the consideration'. True it is that she was enterprising and employable. But on the material accepted by the Tribunal, anti-Chinese sentiment runs deep in Indonesia and the vulnerability of women to rape appears, from the Tribunal's findings, to be high. 62 It requires little empathy to understand that, although the appellant's precise fear of persecution as identified by the Tribunal relates to one man in Jakarta, she may well now suffer profound psychological difficulty in readjusting to Indonesian society and adjusting to a new place of residence in Indonesia at some place where, ex hypothesi , she appears likely to have no close family support. To observe that she had suffered an 'ordeal', yet appeared capable in Australia, where the social environment is entirely different and she has family support, is simply not to acknowledge the major difficulty in the 'practical realities', both psychological and physical, that now would confront her if returned to Indonesia. Who would befriend her? What support, if any, would be available? Would she be able to speak freely about her troubles (there is a suggestion in her materials, unexplored by the Tribunal, that even in Chinese-Indonesian circles shame attaches to a sexually assaulted woman)? Is a Chinese widow on her own in Indonesia especially apt to attract unwelcome sexual advances? 63 If a matter is not mentioned in a Tribunal's findings, this entitles a court to infer that the matter was not considered by the Tribunal to be material ( Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30 ; (2001) 206 CLR 323 per McHugh, Gummow, Hayne JJ (with whom Gleeson CJ agreed) at [69]). That the Tribunal Member engaged in no discussion of questions of those kinds suggests that the psychological aspects of the practical realities facing the appellant were not present to his mind. Given the strangeness of such matters not having been mentioned if they were considered, in my view it is appropriate to draw the inference that they were not considered. I do not wish to seem overcritical. The appellant's case was not a simple one. She had, according to the Tribunal, embroidered some facts and the Tribunal Member thought that a friend who gave evidence was suggesting that, even in the Australian context, she was less robust a person than the Tribunal considered her to be. Nevertheless, it is notorious that in the last 20 years or so the high potential for sexual assault, let alone repeated instances of it, to cause the victim serious psychological difficulties, has become widely accepted. I think that the kinds of potential difficulties to which I have referred were overlooked. There has in my opinion been, as in NAIZ , a failure by the Tribunal to ask itself (as Branson J put it) 'the right questions'. 64 It follows that there has been, on that account, given also the failure to consider fully the aspect of persecution by a non-State agent in which the State authorities at local level might, for Convention reasons, have been sufficiently legally implicated, a constructive failure of jurisdiction of a kind sufficient to invalidate the Tribunal's decision. They involve legal questions only and there is no possibility that they might have been countered in the Federal Magistrates Court by the calling of evidence by the respondents. There is no acceptable explanation of why they were not raised below except that these cases are difficult and it is not uncommon for different minds to perceive different legal problems and arguments. There has been little dislocation to judicial sitting time though some in relation to judgment-writing time. The case raises no new legal issues of wider importance. 66 The appellant has, it has been twice found by the Tribunal, suffered grievously. Should she be wrongly returned to Indonesia to face the risk of further persecution, it would be a bad affair. There is no clear pattern of acceptance by successive Ministers of humanitarian concerns expressed by judges in reconsideration under s 417 of the cases of persons whose applications have been rejected by the Tribunal and who have been shown to have no available curial remedy. I am not, of course, critical of the relevant Ministers in that regard. Nevertheless, I cannot assume that there is likely to be any acceptance of obvious humanitarian concerns for the appellant, if she is not permitted to rely on those of her intended new grounds that have merit. In short, much is at stake for her. 67 Apart from questions of costs, which can be adjusted (and I have no reason to think appropriate orders would be simply hollow), there is no actual prejudice to the Minister, except a degree of disruption to orderly administration. That degree is not, however, great. 68 It does concern me that the appeal to the Federal Magistrates Court might as well have not occurred. The time and energy of a busy member of that court was wasted. It is inescapable that the integrity of the proper curial processes is, to an extent, dealt a blow if the appeal to this Court is upheld on grounds that could have been argued below. 69 Nevertheless, I think that, on terms as to costs, in the interests of justice leave to raise the new grounds should be granted. The general desirability that an applicant for refugee status should have her case determined according to law has added force here, on account of what the Tribunal found she has suffered. Leave will be granted to amend the Notice of Appeal to rely on the grounds discussed at paragraphs 29-64 of these reasons and the Notice of Appeal will be deemed to stand to amended. 2. The orders of the Federal Magistrates Court except as to costs will be set aside. 3. The decision of the Refugee Review Tribunal will be quashed. 4. The Tribunal will be ordered to reconsider the appellant's application according to law. 5. The first respondent will be ordered to pay only $3,000 by way of the costs of the proceedings in this Court (such sum being a figure commonly allowed as the costs of an application to the Federal Magistrates Court). | appeal points not taken below when allowed to be raised on appeal refugees refugee status harm inflicted by non-state actors and possible failure of protection by police at operational level for convention reasons whether each claim adequately raised so as to require the tribunal to deal with it effectiveness of state protection and relocation principle appeal and new trial citizenship, immigration and emigration |
2 The applicant who appeals on questions of law from the decision of the Administrative Appeals Tribunal ('the Tribunal') is a Commonwealth public servant who has worked for the Commonwealth since 1994, apparently in a clerical capacity. He was first employed in what was the Commonwealth Employment Service and then subsequently with its successor known as Centrelink from 1998. At some point in 2001, said by the Tribunal to have been January 2001, he first experienced pain in his right arm, which he associated with his keyboard duties at work. On 5 June 2001 he lodged a claim with the respondent under the Safety, Rehabilitation and Compensation Act 1988 (Cth) ('the Act'), for compensation in respect of his right arm condition, which he described as: 'overuse injury affecting the right arm'. 3 Comcare accepted liability for particular named conditions of the right upper arm, shoulder, elbow and forearm, as well as of the neck. However Comcare decided that as of 19 February 2003 the applicant no longer suffered from compensable affects of his accepted injury. 4 The applicant was diagnosed in mid-2003 as having right carpal tunnel syndrome. The medical reports contain varying histories of when he first had pain in the region of his right wrist and hand. When did your injury first happen or when did you first notice the illness? Painful to lift/move objects with the right hand. Decrease in strength in hand. Give approximate dates. What is the address or location where the injury/illness occurred? What is the exact location, within the above address, where the injury/illness occurred? Describe in detail what events contributed to your injury/illness. Fully describe any equipment or machinery involved in the injury/illness. (Solecisms preserved. In relation to the second decision, the applicant sought administrative review by the Tribunal of the claim. Painful to lift/move objects with the right hand. In consequence, the legal advisors formed the view that it was no longer possible to sustain a diagnosis of carpal tunnel syndrome. Indeed, at least one of the doctors who had propounded that viewpoint apparently had resiled from it in the light of later medical information. 7 The effect of the medical evidence available to the applicant, however, was that the applicant appeared truthfully and genuinely to be suffering from pain in the right upper limb. This had included pain in the wrist and the hand region, and a range of diagnoses by different doctors was proffered. It seems fair to summarise them as indicating that the applicant either had some physical injury, of an aetiology difficult to establish, or had genuine psychosomatic pain arising from an initial physical injury with pain therefrom, and a long course of medical treatment and investigation, some of it involving mildly invasive treatment such as steroid injections. 8 Counsel for the applicant candidly told the Tribunal at the outset that the case would not be pressed on the basis of carpal tunnel syndrome, but would be pressed on the basis that the applicant's wrist complaints were but part of, and subsumed in, broader, ongoing and varying difficulties over virtually the entirety of his right upper limb, the right shoulder and neck, and even headaches. 9 The Tribunal Member had the initial view that orderly processes of administration would be subverted if he proceeded to hear the claim thus recast. He felt that he should take the view that, if the applicant were now saying that the wrist condition claimed for could be accounted for by the occurrence, or progression, or exacerbation of the original accepted right upper arm and shoulder injury, then the appropriate course was to seek a review of the decision which had resolved that, from February 2003, Comcare was no longer liable. 10 The Tribunal Member considered that this matter went to the Tribunal's jurisdiction. I decided that the Tribunal did not have jurisdiction to deal with the issue now proposed on behalf of Mr Abrahams. The role of this Tribunal is to review a decision that has already been reviewed by the two levels, two previous levels, of decision-maker. ' (References omitted. Further, the powers and discretions that the [Tribunal] may exercise under s 43(1) are the powers and discretions conferred by the Act on the determining authority for the purposes of reconsidering a determination under s 62 of the Act. The [Tribunal] will not be authorised on review of a reviewable decision to exercise any powers and decisions which would not have been available to the determining authority at the second tier decision-making stage, albeit that such powers and discretions might have been available to the determining authority at the first tier decision-making stage. This is a precise injury involving pressure on the median nerve as it passes under the ligament across the front of the wrist. The characteristic symptom of this injury is pain and tingling in the first three or four fingers of the hand. ' (References omitted. Original emphasis. This may be true but the inescapable fact is that he did not. Instead he chose to make a claim for a specific injury in support of his claim by medical reports which were equally specific. Correctly, in my view, Mr Abrahams claimed for an injury, not a list of symptoms. It is a decision rejecting liability for this injury which is before me for review and, ... I have all the powers of the decision-maker for all purposes related to the making of the decision. However, these powers do not include the power to treat the application as one for compensation for a different injury, even if that injury was one of which the decision-maker was aware. This is not a case of Comcare having refused to make a decision which the Tribunal can now properly make. Comcare dealt with the application made to it completely when it refused liability to compensate Mr Abrahams. There is nothing to prevent Mr Abrahams seeking compensation for incapacity or treatment expenses for the injury to his right arm. Comcare has already accepted liability to compensate Mr Abrahams in respect of that injury. Counsel appears to be proposing that I should determine issues which should properly be determined on a claim based on the accepted compensable condition and in respect of which Comcare has not yet made a determination. This would be contrary to the three tier decision-making process. ' (Original emphasis. Whilst it was proper for Mr Abrahams to commence the application based on the medical advice then available to him, that advice has changed. An application which was properly made can become vexatious as a result of changed circumstances: Re Williams and Australian Electoral Commission (1995) 38 ALD 366. 16 It seems to me that while, as a matter of generality, the principles stated by the Senior Member are correct, they have been, with respect, misapplied. The maker of the reviewable decision had the same powers in relation to the decision to be made as the original decision-maker, as had the Tribunal. There is certainly an orderly process of administration contemplated by the Act, and it includes, importantly, a requirement that a person may not claim for compensation unless he or she has given : 'notice in writing of the injury ... to the relevant authority ... as soon as practicable after the employee becomes aware of the injury ' per s 53(1)(a). 17 There is no form of notice of injury legally prescribed. What is a 'notice of injury' complying with s 53 is, as Whitlam J noted in Frosch v Comcare [2004] FCA 1642 at [8] , a matter of law. 18 The original decision-maker might conceivably have had many powers, the exercise of which may have been prompted by what he or she knew of the applicant's claim, without those powers being powers or discretions relevant to the exercise of the decision to be made. In construing a document purporting to be a notice of injury under the Act, a broad, generous and practical interpretation should be made, consistent with both the beneficial purposes of the Act and the likelihood that laypeople of differing levels of education, differing levels of medical advice and differing levels of legal advice (indeed in most cases they would not have any) will be giving the notice. 2. In deciding what injury it is, as to which a claimant has given notice, the purposes of giving notice must be borne in mind. These are to enable Comcare, with the aid of the relevant employing agency, to determine whether the claim should be met. 3. The powers of an original decision-maker would extend to regarding informal notice as having been given in amplification of a notice formally given. 4. Those powers would further extend to enabling a consideration of a claim better explaining, or better justifying, a claim in respect of an injury in respect of which notice had been fairly given. 5. There is not always a bright dividing line available to assist in the decision whether powers of the kinds mentioned are being exercised in aid of a better understanding of a claim made in respect of an injury of which notice has been given, or whether the changed notice is sufficiently fundamental as to indicate that a different injury is being asserted, which will require a different decision from a decision in respect of the originally claimed injury under consideration. In determining that matter, considerations of the purpose of giving notice of injury, and more generally of enabling the decision-maker to have a fair opportunity to investigate the claim properly, are paramount. 20 The claim form indicates that the diagnosis was right carpal tunnel syndrome. In the 'Report of injury or disease' (which apparently accompanied the claim for compensation), where the applicant answered the question: 'What injury/disease did you sustain? (Nature of injury):', were the words: 'Right Carpal Tunnel Syndrome'. In the context, it is clear that he was simply adopting the then medical diagnosis of his injury. It was nevertheless entirely clear that he was complaining in fact of pain, swelling and inflammation in the right hand and wrist associated with decreased ability to lift and move objects with his right hand and decreasing strength in the hand. 21 Nothing is more common than that medical diagnoses change and evolve, or are or become various. In my opinion, to hold that the applicant was irretrievably asserting that he had a right carpal tunnel syndrome as the injury to his hand is to take an over-literal view of a document that, as I have indicated, should be beneficially, broadly and practically interpreted. 22 As the applicant's counsel was at pains to say, and not shortly, there was abundant medical information to support a claim that would include, or could include, the proposition that he had suffered some further compensable injury in the period assigned in the notice of injury. He was, as counsel submitted, at least claiming a wrist injury occasioned in that period which had had consequences for medical expense and/or incapacity for him. 23 It would have been open to the Tribunal to treat what counsel was saying as an informal application to amend the notice of injury, if need be, to allege an injury more broadly designated than as 'right carpal tunnel syndrome', or to change it from that designation, provided that the same symptoms, disability and timeframe were still being asserted. The Tribunal Member certainly had jurisdiction to consider such a claim, and it was legally erroneous to say that he had no jurisdiction further to embark on the matter. 24 Second, there was at least a respectable argument for the point of view which I have upheld, and it was mistaken to think that it was so devoid of merit as to be able to be labelled vexatious. It is only when there is no reasonable prospect at all of success that a legal proceeding can properly be so termed. 25 In the result, the appeal must be upheld and the matter remitted to the Tribunal further to consider the matter according to law and in accordance with these reasons. It will still be for the Tribunal to decide whether what has been sought to be litigated is in truth a claim for injury, broadly understood, to the right wrist, occurring in the limited time frame assigned to it in the notice of injury, in which case a proper exercise of the powers of the first instance decision-maker might well be to enable any material that is sought to be put on that subject to be put. 26 If, however, it should emerge that in reality it is the injury formerly accepted by Comcare to have been sustained, and the sequelae of the original injury, and not what may have occurred at work in 2002, then it might well be a legally proper understanding of the powers of the first instance decision-maker to decline to deal with those claims in the vehicle here presented. Other means of having such a claim considered, or of having even a broader claim, basing injury, for example, on all keyboard activity by the applicant in his employment with the Commonwealth, exist. 27 So far as the costs of these proceedings are concerned, while the proceedings may or may not have any practical result for the applicant, and one can but hope they might, the fact is that the applicant has succeeded in his challenge to the lawfulness of the Tribunal's decision. Although in a practical sense there is a good deal to be said for the concerns felt by the respondent, there is inadequate reason to depart from the usual rule. The respondent is to pay the applicant's costs of the proceedings. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick. | judicial review grounds of review whether administrative appeals tribunal has jurisdiction to consider reformulated claim as to employment injury whether proposed reformulation of claim vexatious administrative law |
1 ')). At the request of the parties the Court reserved the question of costs. The Court has now heard the party's submissions in relation to costs which are summarised hereunder. Austrade submits that in accordance with the usual principle that costs follow the event, an award of costs should be made in its favour. In support of its submission Austrade relies upon the decision of the Full Bench in Ruddock and Others v Vadarlis and Others (No 2) (2001) 115 FCR 229 which extensively considered the principles to be applied by the Court when exercising its discretion to award costs. Ruddock was followed in The Wilderness Society Inc v Turnbull, Minister for the Environment and Water Resources and Another [2007] FCA 1863 ; (2007) 98 ALD 651 and Wilderness Society Inc v Turnbull, Minister for the Environment and Water Resources and Another [2008] FCAFC 19 ; (2008) 101 ALD 1. If an order is to be made against Isaac Jewellery, then it submits that it should be entitled to a costs certificate under the Federal Proceedings (Costs) Act 1981 (Cth) ('the Costs Act'). Isaac Jewellery claims that there are special circumstances which should lead to Austrade's application for costs being refused. Isaac Jewellery refers to the fact that the Court found that s 94(1)(b)(i) of the Export Market Development Grants Act 1997 (Cth) ('the EMDG Act') was inapplicable because the former business had ceased to operate. Isaac Jewellery submits that Austrade made no submissions pertaining to that finding and accordingly it was responsible for the error in the Tribunal's interpretation of s 94(1)(b)(i) of the EMDG Act. For its part, Isaac Jewellery submits that it was in no way responsible for the error of the Tribunal and that its submissions before this Court in relation to the appeal were at least arguable. Isaac Jewellery further submits that Austrade's success in the Federal Court was a minor one made on a ground that did not impeach the thrust of the Tribunal's decision to approve a grant to Isaac Jewellery under s 94(1)(b)(ii). Additionally, Isaac Jewellery submits that, as a matter for the exercise of the Court's discretion, the Court should take into consideration the fact that Austrade had suggested that, in an exchange of emails between Garry Dennis, a consultant acting on behalf of Isaac Jewellery, and David Tonkin, a representative of Austrade, the Court's decision would be useful in future assessments made by it under the EMDG Act. Isaac Jewellery submits that the appeal was in the nature of a test case, and that Austrade prosecuted the appeal in the public interest. Isaac Jewellery refers to the decision of Attrill and Others v Richmond River Shire Council (1995) 38 NSWLR 545 in which the Court, having resolved a difference of judicial opinion concerning the interpretation of a provision in the Local Government Act 1919 , ordered each party to pay its own costs of the appeal because the Court found the resolution of the issue to be in the public interest. Isaac Jewellery also relies upon the decision of Acerose Pty Ltd v Workcover Authority of New South Wales (unreported, Sup Ct, NSW, Carruthers AJ, 30 July 1998) in which the successful defendant sought an order that the unsuccessful plaintiff pay its costs. His Honour there deviated from the general rule that costs should follow the event because the matters which were debated before him were matters of much general interest in so far as Local Government administration was concerned. Its submissions before the Tribunal addressed both sub-sections for the Tribunal's consideration but neither party suggested that the Export Market Development Grants (Change in Ownership of Business) Guidelines 2006 ('the Guidelines') applied to s 94(1)(b)(i). Austrade submits that it was the Tribunal's error to erroneously apply the Guidelines to such subsection. Austrade also submits that there is no major public interest in the Court's decision which should lead the Court to depart from the usual practice of ordering that the successful party receive a costs order in its favour. Further, Austrade emphasises that the suggestion that the public interest was to be served by the appeal first arose from a comment by Gary Dennis, Isaac Jewellery's consultant, and that Mr Tonkin's response clearly stated that Austrade would not pay Isaac Jewellery's costs. Austrade submits that the appeal was argued on a narrow ground, namely whether there had been an erroneous application of the Guidelines by the Tribunal. No question of public interest was involved. The only question for determination was whether a grant was payable to Isaac Jewellery under the EMDG Act. Austrade submits that the decisions of State Courts relied upon by Isaac Jewellery should be treated with caution. In Attrill the Court was faced with a difference of judicial opinion relating to a local government statute and such factor clearly demonstrated a distinct public interest. No such consideration arises in the present appeal. Similarly, the decision of Acerose is distinguishable since the Court in that matter was clearly of the opinion that the case before it constituted a test case. As to the decision in Cripps , Austrade submits that it does not stand for the principle that non-indigent public authorities cannot be awarded costs. Since there is no challenge to those principles it is unnecessary to restate them, save to observe that the decision confirms the practice that a successful party is usually entitled to be compensated for its costs by an award made against the unsuccessful party. The basic rule remains that the Court has an absolute and unfettered discretion in relation to costs subject only to the requirement that the discretion be exercised judicially and not arbitrarily or capriciously and not on grounds unconnected with the litigation: see Cretazzo v Lombardi (1975) 13 SASR 4 at 11. Secondly, it remains the established principle that an award of costs to the successful party is compensatory: see Latoudis v Casey [1990] HCA 59 ; (1990) 170 CLR 534 per Mason CJ at 543; McHugh J at 567. Ritter v. Godfrey (1920) 2 K.B. 47. The Court therefore rejects the submission that Austrade was responsible, in whole or in part, for not submitting that the Guidelines had no application to s 94(1)(b)(i) and that s 94(1)(b)(i) had no application on the facts before the Tribunal. In Attrill there had already been a division of judicial opinion within the Supreme Court and the New South Wales Court of Appeal found that the determination of that dispute in the Court was a matter in the public interest. For this reason it ordered that each party pay its own costs. In Acerose and Cripps public interest was found to be involved in the decision. The Court does not consider that there is any wide public interest established in the result of this appeal to justify an order that each party pay its own costs, as was ordered in the authorities relied upon by Isaac Jewellery and the rational for which was considered in Oshlack v Richmond River Council [1998] HCA 11 ; (1998) 193 CLR 72. If an appeal raises a novel question of ' much general importance and some difficulty ' (see Ruddock at [17]), the appeal Court may refuse an order for costs against the unsuccessful appellant: see Re Mersey Railway Co (1888) 37 Ch D 610 at 619 and 621. No such consideration arises in the present appeal. The suggestion that Austrade in some way regarded the appeal as a test case is not supported by the emails relied upon by Isaac Jewellery. It is unclear as to how the public interest is being served by further appealing this matter. Isaac Jewellery can not obtain EMDG benefits unless it spends its own money. If it spends its own money it will further the objectives of the EMDG Act and benefit the Australian community generally and the public interest. Also, the AAT decision appears unlikely to establish a precedent as the circumstances in this case are unique to Isaac Jewellery. Its purpose was vindicated by the Court's finding. As stated, an award of costs is in its nature compensatory, and not punitive. McHugh J at 567 of Latoudis observed that a costs order may, ' and usually will, be made even though the action has failed through no fault of the unsuccessful party '. The Court is unable to discern any factor to justify the Court exercising its discretion in favour of Isaac Jewellery so as to deny Austrade its entitlement to costs. That public interest would seem to be the alleviation of the costs burden that can fall on an individual who appropriately and successfully institutes a proceeding before the Administrative Appeals Tribunal or a federal court yet thereafter finds himself or herself a respondent to a successful "appeal" on a question of law or as to the amount of damage awarded at first instance. Nothing in this Court's decision to uphold Austrade's appeal form the AAT suggests that Isaac Jewellery did not 'appropriately and successfully' institute a proceeding before the AAT, and Isaac Jewellery now finds itself as a respondent to the successful appeal on a question of law by Austrade. Provided the Court exercises its discretion judicially, its power to award a certificate is unfettered: see Bullock and Others v Federated Furnishing Trades Society of Australasia and Others (No 2) (1985) 5 FCR 476 at 477. Austrade has obtained a benefit of a similar kind to that considered in Repatriation Commission v Milenz [2007] FCA 50. Finn J at [4] found that the successful appellant obtained a benefit in ensuring that ' administrative decisions made under the Veterans' Entitlement Act are made according to law ' and thus 'making a respondent ... bear the costs of the appeal in these circumstances undercuts the public interest served by the Federal Proceedings (Costs) Act ' . By analogy, Austrade has an interest in ensuring that decisions made under the EMDG Act are made by the application of the correct principles. In this respect a benefit has resulted in Austrade's favour from the determination of the appeal. Further, the respondent in this case is a small business of limited financial means and thus making Isaac Jewellery bear the full cost of the appeal would undercut the public interest as described by Branson J at [11] of Cornelius . The Court is therefore of the opinion that a certificate under s 6(3) of the Costs Act should be granted to Isaac Jewellery. I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Cowdroy. | costs whether costs order should be made in favour of successful applicant whether special circumstances existed costs certificate costs of unsuccessful respondent circumstances in which certificate should be given practice and procedure practice and procedure |
4 Relevantly, the matter was listed for hearing on 22 November 2004. However, on 18 November 2004 the respondent, who was then represented by a solicitor, applied for an adjournment. I refused the application. On 22 November 2004, who was then unrepresented, applied for a stay of proceedings on the ground that he was indigent and without legal assistance: Dietrich v The Queen [1992] HCA 57 ; (1992) 177 CLR 292 (' Dietrich '). I refused the application and indicated that I would give my reasons at a later date. These are the reasons for my refusal of that application. 7 The High Court has recognised that contempt proceedings are civil, rather than criminal in nature. In Witham v Holloway [1995] HCA 3 ; (1995) 183 CLR 525 at 534 the High Court, in addressing the standard of proof to be applied in contempt proceedings, indicated that contempt proceedings are essentially criminal in nature. However, to say that proceedings for contempt are essentially criminal in nature is not to equate them with the trial of a criminal charge. There are clear procedural differences, the most obvious being that criminal charges ordinarily involve trial by jury, whereas charges of contempt do not. There is no basis, in our view, for importing into the law of contempt the nineteenth century rules which allowed a verdict of guilty, given in a jury trial, to be quashed on appeal, but did not permit of an order for retrial. Moreover, the issue, so far as contempt is concerned, is not whether there should be a retrial, but whether there should be a rehearing. 9 There is a long line of authority to suggest that the principle established by Dietrich as to the use of the Court's inherent power to stay or adjourn proceedings until legal representation is obtained relates only to criminal proceedings. ' (Footnote omitted. It is not authority for the proposition that in other proceedings or inquiries such a step would be required by dictates of fairness, even where someone faced potentially serious consequences. That decision was not intended to apply in respect of civil proceedings: New South Wales v Canellis [1994] HCA 51 ; (1994) 181 CLR 309 at 328-329 per Mason CJ, Dawson, Toohey and McHugh JJ. In that case, the issue was whether a stay should be granted of an inquiry under s 475 of the Crimes Act 1900 (NSW) because of doubts concerning the guilt of a convicted person. The question arose because the State had refused to pay the costs of legal representation for certain witnesses required to appear before the inquiry. As the majority judgments made clear, that principle is based on, and derives from, the accused´s right to a fair trial". In Nguyen v Minister for Immigration and Multicultural Affairs (2000) 101 FCR 20the Full Court of the Federal Court held that the Dietrich principle had no application in the circumstances of a decision of a tribunal in deportation proceedings: see [17] and [18] of Nguyen . There the court referred to the decision in New South Wales v Canellis [1994] HCA 51 ; (1994) 181 CLR 309; 124 ALR 513 where the limited scope of the Dietrich principle was recognised, Mason CJ, Dawson, Toohey and McHugh JJ stating it was concerned with the right to a fair trial of a party to criminal proceedings: at CLR 328. The Full Court in Nguyen considered it was clear the High Court did not favour the extension of the Dietrich principle into the field of administrative review. Having as its source and origin an accused person´s common law right to a fair trial, the principle in Dietrich´s case has, in our view, no application to a review of extradition proceedings under s 21(1) of the Extradition Act . As the majority judgments made clear, the principle is based on, and derives from, the accused´s right to a fair trial. There is no suggestion in the majority judgments that a court could exercise a similar jurisdiction in civil proceedings or in committal proceedings; nor do they suggest that such a jurisdiction could be exercised in favour of an indigent person charged with a criminal offence which is other than serious. Furthermore there is no requirement for the appellant to seek special leave in person from the High Court: see Milat v R [2004] HCA 17 ; (2004) 205 ALR 338. Accordingly, we reject the submission that the Dietrich principle can be invoked in these extradition proceedings on the basis contended because no risk of conviction or self-incrimination can arise in these proceedings conducted in accordance with the Extradition Act , for the purposes of determining eligibility for surrender. It was on this basis that the respondent's application was dismissed. 22 When the trial commenced, Mr Reid was unrepresented. However, the trial was adjourned to allow his solicitor to appear on his behalf and make submissions in closing: see Australian Securities and Investments Commission v Reid [2005] FCA 1274. 23 After I had found that the contempt which was alleged had been proved, Mr Reid was also represented on the question of penalty: Australian Securities and Investments Commission v Reid (No 2) [2006] FCA 700. 24 Because Mr Reid was later represented, this ruling became somewhat academic. I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lander. | application for adjournment based on dietrich principle contempt proceeding nature of contempt proceeding is civil not criminal even though contempt is criminal dietrich principle cannot apply application refused. practice and procedure |
Pursuant to s 25(1A) of the Federal Court of Australia Act 1976 (Cth) the Chief Justice has directed that the appellate jurisdiction of the Court be exercised by a single judge. 2 The appellant is a former client of the respondents who traded as a firm of solicitors. The respondents acted for the appellant in proceedings in the Victorian County Court and ceased doing so on 28 September 2004, presumably because of a failure by the appellant to pay the respondents' fees. 3 On 20 October 2004, the respondents issued a complaint in the Victorian Magistrates Court claiming unpaid fees in respect of the County Court proceeding. On 28 June 2005, the respondents' costs of the Magistrates Court proceeding were taxed by a Master of the Supreme Court. After taking into account set-offs and monies already paid, the amount allowed as owing by the appellant to the respondents was $13,400.01. 4 On 7 September 2005, the Magistrates Court complaint was dismissed with costs. The appellant, who did not attend the hearing, later sought a re-hearing of the matter and obtained a slightly lower costs order. 5 On 9 September 2005, the respondents issued a bankruptcy notice for $13,703.85, being the amount of the taxation by the Supreme Court Master plus interest. The address of the appellant was given as 9 Athol Street, Moonee Ponds. On 31 October 2005, an application was made in the Federal Magistrates Court for an order dispensing with personal service of the bankruptcy notice and that service be deemed to be effected by way of service on the solicitor who had acted for the appellant at the Supreme Court taxation hearing. Orders to that effect were made on 2 December 2005. They provided that service would be deemed to be effected on 30 December 2005 on condition that service was effected on the solicitor by 16 December 2005. 6 As events transpired, the solicitor was not served with the bankruptcy notice by 16 December 2005. Instead, the bankruptcy notice was sent by post to the solicitor on 10 January 2006 and was left at the new offices of the solicitor on 9 January 2006. On 13 January 2006, the respondent received a facsimile from the solicitor, stating that he had mailed the bankruptcy notice to the appellant at his last known address, 41 Chaucer Street, Moonee Ponds. The appellant received the bankruptcy notice on 13 January 2006 and attended the Federal Magistrates Court on that day to inquire about it. On 24 January 2006 he filed an application to extend the time in which to comply with the bankruptcy notice. In an affidavit supporting the application, the appellant confirmed that he had received the bankruptcy notice on 13 January 2006. The time for compliance was extended and then extended again to 6 March 2006. 7 On or about 10 February 2006, the appellant filed a complaint of his own in the Victorian Magistrates Court, alleging breaches of duty by the respondents. That complaint was struck out on 13 July 2006 on the ground that it disclosed no cause of action. 8 On 6 March, at the hearing of the application to again extend the time for compliance with the bankruptcy notice, a Registrar adjourned the hearing of the application but did not extend the time for compliance. The adjourned hearing took place before O'Dwyer FM on 10 April 2006, at which time the application for further extension of the time for compliance was dismissed. The Federal Magistrate also dismissed an application by the appellant to set aside the bankruptcy notice, apparently expressing the view that the proceeding in the Victorian Magistrates Court (which was extant at that time) disclosed no cause of action. 9 On 9 May 2006 the respondents filed a creditor's petition. The petition, unlike the bankruptcy notice, claimed only the debt of $13,400.01. In other words it only claimed the amount of the taxation of the County Court proceeding and did not claim any amount in respect of interest. 10 On 16 June 2006, the appellant attended the respondents' offices and handed to a law clerk in the employ of the respondents a cheque in the sum of $13,400.00, apparently in anticipated satisfaction of the debt owed. The clerk did not regard herself as having authority to accept the cheque since there was a note on the relevant file made by Mr Velos, one of the respondents, suggesting that the parties had agreed on a sum of $15,000.00 to settle the proceeding. 11 On 29 June 2006, when the hearing of the petition was returned in the Federal Magistrates Court, a number of amendments were made to the petition. Those amendments were made pursuant to leave granted by a Registrar on 21 June 2006. First, in the words of Burchardt FM, the correction of "two minor typographical matters in paragraph 2, neither of which in my opinion would have misled the Respondent". Secondly, the correction in paragraph 4 of the petition of the date of the failure to comply with the bankruptcy notice. Thirdly, the correction of the date of service. Fourthly, changing the description of the creditor from "Velos & Davis (a firm)" to "Bill Velos & Peter Davis trading as Velos & Davis (a firm). 12 On 10 August 2006 a Registrar made a sequestration order. On 28 August 2006 the appellant applied to set aside that order. On 2 February 2007, Burchardt FM dismissed that application. 13 On 8 September 2006, a Master of the Supreme Court dismissed an appeal from the striking out of the appellant's Victorian Magistrates Court complaint. 14 Finally, on 2 February 2007, Burchardt FM (who I shall refer to as the Federal Magistrate) dismissed the appellant's interim application to set aside the sequestration order and the creditor's petition. It is appropriate to address the factual and legal findings in respect of each of them. Nonetheless, his Honour noted that the law is clear that a creditor is not obliged to accept tender of the sum owed if a creditor's petition has been presented: McIntosh v Shashoua [1931] HCA 56 ; (1931) 46 CLR 494. His Honour found that nothing turned on this amendment. He said: "The [respondent] has at all times been a partnership and has sued as such. The fact that the partnership is constituted by two individuals is wholly irrelevant to its existence as what the [appellant] described as 'a juristic person'. " His Honour also found that, contrary to the appellant's assertion, Mr Velos has always had the requisite authority to sue on behalf of the firm, and that Mr Velos and Mr Davis, the respondents, jointly agreed to commence the proceedings against the appellant. He assumed, perhaps somewhat generously, that this meant that the appellant claimed that he owned this property unencumbered. The appellant also deposed to owning shares worth $1,000 and cash of $15,000 as well as having "family and friends dollars? a phone call away" and various other assets. His Honour said the appellant had made no endeavours to obtain funds from family and friends. His Honour noted evidence filed by the respondents showing that the appellant does not own registered land in Victoria but was prepared to assume, again generously, that "in some prima facie inexplicable way he may have an interest in land of some sort". 19 There was further evidence about the Olinda Street property. It suggested that the property was situated in Beaufort and that the appellant purchased it for $6,000 in 2002. He thereafter built a property on the land and has offered it for sale with an asking price of $75,000. However, a likely realisable purchase price is between $65,000 and $70,000, as recorded on the Real Estate Institute of Victoria exclusive sale authority. Further evidence, in the form of a flyer from a real estate agent, suggested that the construction of the property has not proceeded beyond the laying of foundations. 20 The appellant's wife swore an unchallenged affidavit in which she said that "the land has a proposed plan of subdivision with a minimum completed value of $250,000". The Federal Magistrate said of this affidavit that its style "suggests very strongly that its author was in fact the [appellant] himself". 21 The final piece of evidence concerning the Olinda Street property is the attribution by the relevant shire of $13,000 as the capital improved value of the property, and $13,000 as to the site value. The Federal Magistrate said that this probably suggests that the council valued the property at $26,000. He did not make a finding that the property was actually worth $26,000. 22 The Federal Magistrate found that "there is nothing in the material put forward by the [appellant] that enables the Court to form any view as to the true value of the Olinda Street property, whether subdivided or in its current state. " He also found that the council valuation did not go to "establish to the Court's satisfaction what the true value of the property is. As the Federal Magistrate noted, if one takes out the $55,000 asserted in respect of the Olinda Street property, the appellant's asserted assets are marginally less than his liabilities. 24 Based on this, the Federal Magistrate concluded that the appellant was insolvent. Those monies are not however limited to cash resources immediately available. They extend to monies which the debtor can procure by realisation by sale or otherwise of assets within a relatively short time. The conclusion of insolvency should be clear from a consideration of the debtor's financial position in its entirety and generally ought not to be drawn simply from evidence of a temporary lack of liquidity. It is the debtor's inability utilising such cash resources as they have or can command to meet their debts as they fall due which indicates insolvency. Whether that state of affairs has arrived is a question for the Court and not one to which expert evidence may be given in terms. In fact, there was evidence that the appellant is currently a student at the University of Tasmania. His Honour appears to have inferred that the appellant studies law, although why he should have drawn that inference is not stated. He concluded that "the possible, and in my view unproved, detriment that bankruptcy might have on any legal career would not be enough to persuade me that the petition be set aside". 26 The Federal Magistrate also considered the failure to provide or the very tardy provision of a statement of affairs to the trustee in bankruptcy as a relevant discretionary factor. His Honour exercised his discretion not to dismiss the petition. His Honour accepted the evidence of Mr Velos that the petition was served outside the Court. The Federal Magistrate noted that a Master dismissed the Supreme Court proceeding on 8 September 2006 and that accordingly it was of no assistance to the appellant. The Federal Magistrate noted that he was not in a position to go behind a decision of another Federal Magistrate. The Master made an order staying execution of the order for taxation for 14 days. The appellant appears to have claimed that interest did not accrue during this period. The Federal Magistrate disagreed but noted that at any event the creditor's petition claimed an amount that did not include any interest on the amount allowed by the Master. Without explaining why, the Federal Magistrate found that the change in date was not likely to confuse the appellant. 32 The appellant also made submissions about confusion occasioned by the change in description of the legal name of the respondents. The Federal Magistrate referred to the irrelevance of the change in the description and said "I do not think that the partnership as an entity known to law was ever in danger of being misunderstood and I do not believe that the changes made were of any moment. The appellant said that the proceeding before the Federal Magistrate amounted to an improper use by the respondents of their superior legal skills and resources generally. As well as noting that the respondents were not legally obliged to accept tender, the Federal Magistrate appears to have accepted the evidence of Mr Velos that there was no improper motive in bringing the proceedings. His Honour noted that with the addition of a number of costs orders, the debt owed by the appellant to the respondents was in excess of $16,000. He also accepted the respondents' submission that acceptance of the tendered amount may have given rise to a preference. His Honour concluded that there was no abuse of process or ulterior motive. The Federal Magistrate accepted that the use of the wrong address was an error. 35 The appellant noted that he had not been served with the bankruptcy notice in accordance with the orders made by a Registrar on 2 December 2005. The Federal Magistrate said that a failure to serve in accordance with an order for substituted service does not preclude service in the usual manner, and that this had occurred in this case. He dismissed the application, with costs to be paid out of the appellant's bankrupt estate. The acts, facts and matters before and after the order; not substantially obeyed; makes defamatory implications against the appellant. The order and its non compliance fails to meet essential requirements of the Act. There is no evidence that any witness committed perjury in order to obtain the substituted service order. There is no evidence that any defamatory implications were made against the appellant. There was no failure to comply with the substituted service order. It stated "Service of the bankruptcy notice deemed to be effected on 30 December 2005 upon condition that the two events referred to in paragraph 2 occur by 16 December 2005" (emphasis added). In other words, the order merely gave the respondent an opportunity to serve the appellant other than in the normal way under reg 16.01 of the Bankruptcy Regulations . A failure by the respondent to avail itself of that opportunity was not a breach of the order. 40 In any event, nothing turns on the manner in which the appellant was served with the bankruptcy notice. He deposed to receiving it on 13 January 2006 and there is no evidence that he has suffered any prejudice as a result of having been served with it then and not at some other time. 41 The reference to hearsay in this and other grounds of appeal is curious. First, as a matter of law, since the hearing before the Federal Magistrate was of an interim application, hearsay evidence is admissible. However, I do not think this is what the appellant means when he complains of hearsay evidence. Rather, the impression I have is that he uses the word "hearsay" to describe evidence that is not in writing. If I am right, the hearsay allegations betray a fundamental misunderstanding of the laws of evidence. Evidence does not have to be in writing to be admissible or persuasive. A trier of fact is at perfect liberty to accept oral evidence, even if that evidence conflicts with other written evidence. The hearsay allegation here and elsewhere cannot be sustained. 42 It may be that this ground raises, by implication, the issue of the appellant's address. The Federal Magistrate accepted that the respondent's confusion as to the appellant's address was an error and not malicious. There are no grounds for interfering with that finding. At any rate, it should be noted again that there is no evidence of any prejudice suffered by the appellant as a result of correspondence having been sent to him at the wrong address. The counterclaim documents are in the Victorian State Magistrates' and Supreme Court's, and not in the Federal Magistrates' Court Registry. The appellant's right of claim pursuant the Constitution and S 40 of the Act are repressed and not tested to validity. The appellant's rights and claim as against the respondents, continues to exist. The order fails to meet an essential requirement pursuant to s40 of the Act. It appears to raise a number of claims, none of which is valid. First, there appears to be a claim that the Federal Magistrates Court has no jurisdiction to consider documents filed in proceedings in other courts. Secondly, it appears to allege that the Federal Magistrates Court cannot rule on the prospects of a proceeding in another court because to do so would mean that that claim in that other court would be "repressed and not tested to validity". It may be that it is alleged that there is a constitutional prohibition on the Federal Magistrates Court doing so. 45 I assume that the reference in this ground of appeal to s 40 of the Act is a reference to s 40(1)(g) of the Bankruptcy Act 1966 (Cth). This does not involve the Federal Magistrates Court exercising the jurisdiction of that other court. No issue estoppel arises by the Federal Magistrates Court making findings as to the prospects of success of a proceeding in that other court. If the other court finds, contrary to the view of the Federal Magistrates Court, that there is a counter-claim, set-off or cross demand, this may be grounds for subsequently setting aside any sequestration order made by the Federal Magistrates Court. 47 In this case, O'Dwyer FM was satisfied that there was no counter-claim, set-off or cross demand in respect of the proceeding commenced by the appellant in the Victorian Magistrates Court. That decision has not been appealed. This ground fails. It continues "the petition relied on an act of bankruptcy to a date after the expiration of the bankruptcy notice and fails essential requirements of the Act. The amended creditor's petition relies on an act of bankruptcy being the failure to comply on or before 6 March 2006 with the bankruptcy notice. The bankruptcy notice was issued on 9 September 2005, and therefore was to expire on 9 March 2006. The time fixed for compliance with it was 21 days from the date of service. The appellant admits to having received the bankruptcy notice on 13 January 2006. Section 40(1)(g) of the Bankruptcy Act makes it an act of bankruptcy to fail to comply with a bankruptcy notice unless the debtor satisfies the court of the existence of a counter-claim, set-off or cross demand. The appellant has never satisfied a court of any of these matters and so, pursuant to s 40(1)(g) , is deemed to have committed an act of bankruptcy when he failed to comply with the bankruptcy notice within 21 days of being served with it. The creditor's petition reflects this position. There was no elaboration of which "essential requirements of the Act" the bankruptcy notice was said to fail. This ground of appeal fails. The ground alleges that the affidavit "is an admitted indictment of motive" and "evidence of reckless perjury as against the appellant". He says that the affidavit "seeks to challenge a fundamental fact and act, that full tender was offered on 16 June 2006". 51 The affidavit does none of the things alleged. It does no more than state that, as at that date, $13,400.01 remained owing from the appellant to the respondent. The fact that it did not refer to the appellant's tender of $13,400 on 16 June 2006 is irrelevant since the respondents had no obligation to accept tender. An affidavit from the clerk who spoke to the appellant on 16 June 2006 makes the situation clear. She deposed that she told the appellant: "I don't know if I can accept this cheque in full settlement. There is a note on the file to say that when Mr Velos met with you in the Magistrates' Court on 2 nd June 2006 that an arrangement was made between you that upon payment of $15,000 that all matters would be settled. " The appellant is then said to have replied "well I'm giving you this much. A settlement had been reached. Presumably it was larger than the debt claimed in the petition because the respondents felt they were entitled to an amount in respect of their costs. They will indeed get such an order. There is no "indictment of motive". There is certainly no "reckless perjury". That second allegation in particular should never have been made. This ground fails. It claims that the appellant received the amended creditor's petition in the mail on 30 June 2006 and that the petition demanded compliance by the earlier date of 21 June 2006. 54 The underlying problem with this ground is that it proceeds on the assumption that the version of the creditor's petition that has "Amended 29 June 2006" at the top of its first page is a new creditor's petition. In my view it is clearly not. It is the same creditor's petition with a small number of handwritten amendments. Those amendments were made pursuant to an order of a Registrar made on 21 June 2006. 55 Further, this ground is disingenuous. The petition, as amended, does not demand compliance by 21 June 2006. All it does is note that the hearing of the petition is listed for 21 June 2006. This is not surprising. The petition as amended merely corrected a small number of potential problems with the original petition. The evidence is that it was amended at the hearing of the original petition on 29 June 2006. The unamended petition also states that it is to be heard on 21 June 2006. There is no evidence as to why it was not heard until 29 June 2006. The unamended creditor's petition was validly served. An affidavit of Mr Velos, which was accepted by the Federal Magistrate, deposes as much. There is nothing in the Bankruptcy Act or Bankruptcy Regulations that requires an amendment made to a creditor's petition to be notified to the debtor by personal service of the creditor's petition as amended. This ground fails. The dubious methodology adopted, distorts. The purpose alleged was to prove or disprove solvency. The essential requirements of the Act a contrary purpose was intended in bankruptcy law and the claim of McIntosh v Shashoua, 76 years ago is that, THAT case, is not THIS case. I think what the remainder of the ground alleges is that the appellant again tendered payment of the debt on 10 August 2006, not for the purpose of having the tender accepted but rather to demonstrate that he was solvent. Even if I assume, in the absence of any evidence, that the appellant did tender payment again on 10 August 2006, this ground is still flawed. The tender of a cheque in the amount of the debt owed to one creditor does not prove solvency. There is no indication of the provenance of the funds. It is entirely possible that payment of the debt owed to the respondents would have led to both a reduction of the appellant's liabilities and a corresponding reduction in his assets. If that is the case, his overall solvency is not altered. Furthermore, insolvency consists of an inability to pay all of one's debts as and when they fall due. The ability to pay one debt is not evidence of an ability to pay the others. This ground fails. It is defeated by the passive discourse content and prestige bias in the judgment of Burchardt FM. Neither is a ground for appeal. It may be true that the rule of law underpins certain legal doctrines, but breach of the rule of law is not a cause of action and nor is it a ground of appeal. I have carefully read the judgment of the Federal Magistrate and can see nothing in it that could give rise to actual bias or a reasonable apprehension of bias. If what is meant by this ground of appeal is that the Federal Magistrate found for the respondents because they are wealthier, have greater legal knowledge or are more prestigious than the appellant, then there is nothing in the judgment to justify such an allegation. This ground fails. It further alleges that the Federal Magistrate did not give sufficient weight to evidence in the appellant's sworn affidavits. 61 It is wholly unacceptable to allege perjury against a witness without providing particularisation. There is no evidence before me that any witness committed perjury before the Federal Magistrate. All that happened is that the Federal Magistrate accepted the respondents' evidence. This is unexceptional. Anyone bringing a person to the Court of bankruptcy with its quasi penal status, must also be subject to the same penalties if proved. The Statute states that a person is bankrupt, if, and only if, a person is not solvent. First, the abuse of process issue dealt with by the Federal Magistrate. Secondly, the issue of whether the appellant is indeed insolvent. 64 I agree with what the Federal Magistrate said about abuse of process and ulterior motive. It is clear that the respondents were not obliged to accept the tender made on 16 June 2006. Nor were they obliged to accept any tender made on 10 August 2006, if indeed such a tender was offered. The Federal Magistrate accepted the evidence of Mr Velos that there was no improper motive involved in that refusal. That is a finding of fact with which I cannot interfere. At any rate it seems inherently plausible. The Federal Magistrate referred to a file note recording a settlement of all liabilities between the appellant and the respondents. The settlement amount was greater than the amount of the creditor's petition, presumably because of costs. It was entirely reasonable for the respondents to refuse to accept a cheque for anything less than the full amount on which the parties agreed to settle. 65 No objection can be taken to the manner in which the Federal Magistrate determined that the appellant is insolvent. His Honour applied a simple balance sheet approach, involving consideration of the appellant's assets and liabilities. He accepted the appellant's own assessment of his liabilities, but did not accept his assessment of his assets. This is not surprising. In the circumstances, the list of liabilities is an admission against interest and is inherently plausible. On the other hand, the list of assets is beneficial to the appellant and it is reasonable to subject it to greater scrutiny. His Honour found in particular that there was no evidence of the value of the Olinda Street property. I agree with that conclusion. It is relatively easy, through title searches and sworn valuations, to prove the value of property owned by a person. That was not done in this case. Instead, the appellant relied on his own and his wife's assertions of the value, and the amount he was prepared to sell it for. There can be no complaint with the Federal Magistrate's decision not to accept this evidence as proof of the value of the property. 66 The appellant argued that since the Federal Magistrate had accepted the council's valuation of the Olinda Street property as being $26,000, his assets in fact exceeded his liabilities. There are two problems with this argument. The first is that the Federal Magistrate did not accept the council's valuation; all he said was that the valuation "probably suggests that the council values the property at $26,000.00". The second is that there was insufficient evidence to prove that the appellant owned the property. It is to be remembered that the Federal Magistrate's discussion of the value of the property was prefaced by the following caveat: "I will assume in the [appellant's] favour for these purposes that in some prima facie inexplicable way he may have an interest in land of some sort". It is hard to imagine a more qualified assumption. It was never elevated to the level of a finding. At the hearing before me, a Certificate of Title was handed up. It records that the appellant has been the registered proprietor of certain land since 23 March 2007. I did not accept the Certificate of Title into evidence. It is irrelevant to the question whether the appellant owned the Olinda Street property at the relevant time. 67 The appellant objected to an affidavit of Mr Velos, sworn in response to the appellant's affidavit setting out his assets and liabilities. Mr Velos described $78,500 of the appellant's listed assets as "dubious". This issue was not addressed by the Federal Magistrate. The reason is simple. The appellant's affidavit lists $102,500 of assets. It is true that many items in his list of assets are given a value together with the word "plus". However, it is apparent that the Federal Magistrate did not accept that any item was valued at more than the dollar figure given. As I have said, the Federal Magistrate did not value the Olinda Street property. When this property is removed from the list of assets, the total value of assets drops to $47,500. Further on in the appellant's affidavit, liabilities of almost $50,000 are listed. The Federal Magistrate therefore concluded that the appellant was insolvent. It was not necessary for his Honour to consider whether any other of the assets listed by the appellant should be discounted, since insolvency had already been made out. He did not need to consider Mr Velos' allegation that $78,500 of the assets were "dubious". 68 This ground fails. It appears that this ground alleges that the Federal Magistrate made his decision based on "undirected considerations of fairness" and not "legal standards". There is no basis for making this allegation. His Honour clearly directed his mind to the legal question to be resolved. To the extent that the Bankruptcy Act gave him a discretion there is no basis for saying that its exercise miscarried. It alleges that the respondents intended to use court proceedings to gain a financial advantage over the appellant and other unspecified parties. It then, entirely irrelevantly, says that the criminal law should "operate uniformly in circumstances which are not materially different". 72 I repeat what I have said in respect of ground 9 so far as it concerns abuse of process and ulterior motive. As this is not a criminal proceeding, I need not consider the ground insofar as it raises issues of criminal law. This ground fails. If an officer of the Court breaches his or her duties to the Court there are sanctions that may be brought to bear. None of those sanctions will assist the appellant. This ground fails. I refer to what I have said in respect of ground 7. It also says that the Federal Magistrate's judgment did not embody the principle that citizens are equal before the law. There is no substance to this complaint. Nor would it be a ground of appeal if it were. The principle of equality before the law underlies many legal doctrines but does not itself constitute a cause of action. This ground fails. The Court believed and trusted the respondents to state the truth. There is no evidence of perjury. This proceeding does not deal with allegations of criminal conduct. The Federal Magistrate accepted the evidence of the witnesses for the respondents and an appeal cannot overturn his Honour's findings of fact absent legal error, which has not been shown. This ground fails. I have dealt with the perjury allegation. Even if it were true that the respondents' witnesses had brought the Court into disrepute, which it is not, this would not avail the appellant. This ground fails. Blatant lies, untruths, are deposed to gain unfair advantage, causing financial damage to the appellant, by using the Court as a device to obtain that unfair advantage, this betrays a mens rea embodied in their statements. I will say no more about it. No basis for this allegation has been raised and accordingly this ground of appeal fails. I will say no more about it. Subsequently therefore, Beringa Investments P/L whom the respondents have brought as a creditor as against the appellant; they also wanted to bankrupt the appellant. Hence it follows, the respondents denial of Judge Ostrowski's words in the Beringa matter, must necessitate in this matter, His Honour said words to the effect 'This is what happens when your clients want to bankrupt someone, Counsel'. It is not explained how Beringa Investments and any claim it may have against the appellant are relevant to this proceeding. I have no idea what I am to make of the reference to the words attributed to Judge Ostrowski. The best I can make of this ground is that it alleges that as a result of the respondents' illegal conduct, the appellant has suffered some detrimental effect in its dealings with Beringa Investments. I have earlier explained why the respondents were entitled to refuse tender of the sum in the creditor's petition and why there is no evidence of abuse of process, ulterior motive or perjury by the respondents or anyone associated with them. Absent that predicate, this ground of appeal goes nowhere. It must fail. They were, like his grounds of appeal, largely incoherent and suggestive of a believer in conspiracy theories. For example, much was made by the appellant of descriptions in the respondents' affidavits. He says that one of the respondents' affidavits used coded language to portray him as a builder who doesn't pay his debts. 88 The appellant has presented his case in the apparent hope that if enough mud is thrown some of it will stick. Hence he makes all manner of allegations without linking most of them to his legal position. Even if many of his allegations were correct, and they are not, their correctness would not avail him. He does not, for example, explain how the fact that the respondents appears to no longer trade under their original name is in any way relevant to the success of this appeal. 89 His submissions also have the unfortunate habit of blaming every alleged error by the Federal Magistrate on the perjury or "dubious methodology" of the respondents or their witnesses. This is clearly done as a way around the problem of the Federal Magistrate having comprehensively found against him on factual matters. 90 None of these other matters need trouble me since they go beyond the grounds of appeal. At any rate, I am satisfied that none of them would result in the Federal Magistrate's decision being impugned. Since the appeal is to be dismissed, it is unnecessary to consider the motion. I will therefore dismiss it. I will grant that leave. 94 I will order that the appeal be dismissed and that the respondents' motion be dismissed. 95 The appellant has made numerous allegations of perjury against various of the respondents' witnesses. He has come nowhere near satisfying me that any of those allegations has any substance. An allegation of perjury is a very serious matter and should not be made unless the party alleging it has good cause for doing so. Officers of the Court are well aware of their ethical obligations not to raise a perjury or fraud allegation without justification. In this case, I am of the view that the fact that the appellant is a litigant in person does not excuse his conduct. The perjury allegations are multiple and likely to cause distress and possibly reputation damage to those against whom they are made. The evidence supporting them is almost non-existent. But for one matter, it would have been appropriate that I exercise my discretion to award indemnity costs against the appellant. That one matter is that as a result of this appeal, the appellant remains a bankrupt and his estate remains vested in his trustee in bankruptcy. The effect of an indemnity costs order would be to prejudice the interests of other creditors by reducing the amount of the appellant's estate available for distribution to them; it is unlikely to have any real effect on the appellant. The appellant should consider himself warned that if he makes unfounded perjury or fraud allegations in future proceedings he exposes himself to potential serious costs implications. 96 The respondents seek an order that the costs of the motion and the appeal be paid out of the appellant's bankrupt estate with priority under s 109 of the Bankruptcy Act 1966 (Cth) as if a sequestration order had been made on the hearing. 97 The effect of the order sought is that the costs of this hearing will be treated as costs of the petitioning creditor and that they will be paid in priority to most other payments to be made from the appellant's estate. I consider that the costs of this appeal, concerned as it is with the validity of a creditor's petition and sequestration order, are costs of the petitioning creditor quite apart from any order to that effect. However, since there is no harm in making the situation perfectly clear, I will make the order sought. Although I am dismissing the motion, this is only because it is strictly unnecessary to determine it. The respondents are entitled to their costs of the motion. I certify that the preceding ninety-seven (97) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Sundberg. | solvency set-off magistrate did not accept appellant's statement of assets or existence of set-off indemnity costs unsupported allegations of perjury whether appropriate to make against bankrupt bankruptcy costs |
When the matter was returned this morning the respondent was represented by Mr Webb SC and Mr Altan. They have submitted that I should revisit the finding I made in my judgment delivered on 12 May 2006, Natural Floor Covering Centre Pty Ltd v Monamy (No 3) [2006] FCA 602 , on the basis that the reformulated charge has elevated the sign depicted in order 1 made by Wilcox J on 15 December 2005 to the status itself of the trademarks, the protection of which was understood to be the object of order 1. Against that background the respondent submits that order 1 made on 15 December 2005 was clearly intended to protect the registered trademarks numbered 981970 and 1013021 from infringement by the use of signs, symbols or devices that were the same or substantially identical with those marks. The respondent submits that when one has regard to the fact that the concept employed by the parties in their consent orders eschewed the broader concept of deceptive similarity as explained in The Shell Co of Australia Limited v Esso Standard Oil (Australia Limited) [1961] HCA 75 ; (1963) 109 CLR 407, it is at least open to raise a reasonable doubt as to whether what the respondent did, as previously found by me (in Natural Floor Covering Centre Pty Ltd v Monamy (No 3) [2006] FCA 602 at [12] ) was in fact a use that was the same or substantially identical with either of the registered marks. (The respondent does not accept that that finding was one which should have been arrived at on the facts, but has left such rights as he may have to deal with that matter to be the subject of an appeal rather than seeking leave to reopen generally. ) Today is the first occasion on which I have had the benefit of representation of the respondent by counsel. Until now, effectively, the case has proceeded with the respondent acting for himself. The question of whether the Court should allow a limited reopening of the kind sought by the respondent has been discussed in a number of authorities. In Smith v New South Wales Bar Association [1992] HCA 36 ; (1992) 176 CLR 256 at 265 Brennan, Dawson, Toohey and Gaudron JJ dealt with the question where, as here, judgment has been given. I have made a finding of guilt on charge 2, but no orders have been entered. Their Honours pointed out that the power of the court to set aside or vary such a judgment, reflected in the analogue of O 35 r 7(1), was discretionary and existed up until the entry of judgment. Their Honours said that it was a power that was exercised having regard to the public interest in maintaining the finality of litigation and that if reasons for judgment had been given the power was only exercised if there was some matter calling for review. There may be, their Honours pointed out, more or less reluctance to exercise the power depending on whether there is an avenue of appeal. Their Honours approved the statement that where there had been judgment in a case, but the order had not been entered, the power would not ordinarily be exercised to permit a general reopening. However they made clear that that was a general statement only and, once the matter had been reopened, the nature and extent of the review had to depend upon the error or omission which led to the step being taken. In this case the error that is posited is that there was a factor overlooked by me in a construction of the order that might give rise to a reasonable doubt as to whether there had been a breach of it as I found. I am of the opinion that in the circumstances of the proceedings, the respondent has shown that there is a matter calling for review ( Smith v New South Wales Bar Association (1992) 176 CLR at 265 and Texas Company (Australasia) Limited v The Federal Commissioner of Taxation [1940] HCA 9 ; (1940) 63 CLR 382 at 457 per Starke J). Accordingly, in my view, it is appropriate for me to consider the argument now raised by the respondent for the purposes of reconsidering my finding, particularly as the respondent has sought to limit the basis of the review, notwithstanding that he maintains a position of wishing to challenge the factual findings that I have made in the event that an appeal is taken. In construing orders which are sought to be made on the subject of findings of contempt where later contraventions are alleged, it is permissible to have regard to any judgment given by the court pronouncing the orders and other relevant surrounding circumstances ( Athens v Randwick City Council [2005] NSWCA 317 ; (2005) 64 NSWLR 58). One of the surrounding circumstances in this case is the fact that there were heads of agreement made between the parties prior to the formulation of the consent orders accepted by the solicitor then acting for the respondent. There does appear to be a variance between what is in the heads of agreement and the consent orders made by Wilcox J on 15 December 2005, although, as the applicant points out, the provisions of the heads of agreement ought to be read as a whole. Secondly, the applicant points to the fact that the consent orders specifically identify a particular sign as being agreed to be one the use of which is prohibited as an aid to the construction which would support the finding that I have made. The respondent referred to the decision of Windeyer J in the Shell Co of Australia Limited v Esso Standard Oil (Australia Limited) (1961) 109 CLR at 414-415, where his Honour considered the concept of 'substantial identity' within the meaning of the then Trademarks Act 1955 (Cth) and the decided cases on those words, both here and in England, in contradistinction to the other concept used in the legislation of 'deceptive similarity'. He explained that the task was to compare side by side the similarities and differences noted and the importance of those assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from that comparison. He said that the judgment ought to be by eye alone for the purposes of determining substantial identity, but noted that in an animated depiction where matters do not stand still fleeting glimpses of substantial identity were not enough, although the position may be different with regard to deceptive similarity. Since order 1 does not refer to the latter concept I need not deal with it. Given that these are proceedings which are criminal in nature in which the liberty of the subject is in issue, it seems to me that I should err on the side of caution in construing order 1. Having now had the benefit of the argument put by the respondent, I am of opinion that the words 'substantially identical' as used in that order could be construed as denoting the concept in s 120 of the Trademarks Act 1995 (Cth) and as expounded in judicial decisions and that it is a reasonable construction of order 1 to read it in the way submitted by the respondent today. That is so even though this is not necessarily the only construction that one would make. That is to say, the parties were identifying a limited legal concept as defining the extent of the protection that the order was seeking to give to the applicant's two trademarks and they accepted that the particular depiction, included as part of order 1, was an infringement of them. While that is not, for the reasons I have given in my earlier judgements, the construction which I would place on the words, I am not satisfied beyond reasonable doubt, having now reflected upon the new argument put by the respondent through his counsel today, that that is the only way one would read the consent orders in light of the heads of agreement which the respondent signed on 12 December 2005. The applicant urged that findings I had made in Natural Floor Covering Centre Centre Pty Ltd v Monamy (No 3) [2006] FCA 602 at [12] in any event precluded the respondent having success on the reopening. This was because I found that by causing the animation to produce in sequence what was ultimately the shape that amounted to the spiral or cover-roll design and then the words 'Simply Natural Floorcoverings', the respondent had used and displayed a sign on his website in contravention of order 1 as charged in amended charge number 2. As I understand it though, the respondent's contention really goes to the fact that charge number 2 elevates the sign depicted in order number 1 into a mark in itself that was capable of protection. I am of opinion that the order is capable of being read in the sense that the respondent has advocated today, although that is not the way I, myself, would read it for the reasons I have given earlier. However, I think that I ought to find that the charge number 2 has not been proved beyond reasonable doubt because of the difference in interpretation which order 1 made by Wilcox J could give rise to having regard to the heads of agreement. I therefore vacate my finding that charge 2 has been proved beyond reasonable doubt and I will enter a judgment of not guilty on that count. | trade marks and trade names similar marks and goods and services of the same description substantial identity disobedience of court orders construction of order where respondent unrepresented at previous hearing and limited reopening sought judgments and orders construction and interpretation contempt proceedings use of surrounding circumstances where respondent unrepresented at previous hearing and limited reopening sought intellectual property contempt of court practice |
Ms Carey described herself as 'the director' of Richstar and said she was authorised to swear the affidavit on its behalf. She stated that her affidavit was sworn in support of a motion seeking approval of payment 'of legal costs relating to potentially litigious issues ... pertaining to the Court appointed receivers, Korda Mentha (sic)...'. The affidavit thereafter exhibited an exchange of correspondence between Ms Carey and the receivers appointed by the Court to Richstar. On 10 August 2006 Ms Carey sent to one of the receivers, Mr McMaster, an invoice from a barrister, Maria-Luisa Coulson, '... for work carried out for Richstar in relation to the Richstar funding arrangement with Keypoint Developments Pty Ltd'. The invoice was addressed to Ms Coulson. In each case he required a more detailed account of the services provided in respect of the invoice and confirmation that such services were provided to Richstar. Ms Carey sent a letter to Mr McMaster on 22 August 2006 enclosing a letter of the same date from Ms Coulson. In that letter Ms Coulson confirmed that the work which she had performed and which was the subject of her invoice was for services relating to a potential claim by Richstar against its receivers. She said that Mr Zilko's invoice also related to the provision of advice with regard to the potential claim and that he was briefed by her in that regard. On the following day, Mr McMaster wrote to Ms Carey attaching a copy of the orders made by the Court on 7 August 2006. Any application for a direction for payment of such expenses is to be made to the Court by the ninth defendant. However the first limb of the order makes it clear that the Court receivers were not required to approve payment of any expenses relating to expenses on the part of any defendant. I accept that it is appropriate in those circumstances that Richstar should approach the Court for approval of the payment which it seeks. The receivers and managers should not be placed in a position of conflict of interest and duty because the expenses sought relate to a potential claim against them. As to the merits of the matter, the affidavit in support of the motion discloses nothing of the nature of the potential claim. The receivers in this case were appointed under s 1323 of the Corporations Act 2001 (Cth) in aid of a public regulatory function. Their primary function is the protection, in the public interest, of the assets of the company pending the completion of investigations by the Australian Securities and Investments Commission. The scope for any cause of action against them by reason of the manner in which they discharge their duties must be limited. No basis for any cause of action is disclosed on the materials before the Court. I will give no encouragement to any conduct by Richstar or its directors which is, or may be, calculated to put pressure on the receivers in the discharge of their public function. Nor will I countenance diminution of the company's assets in the pursuit of enquiries in that respect without some clear justification. The motion will be dismissed. The receivers took no part in the argument on the motion so there will be no order for the costs of the motion. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French . | court appointed receivers receivers appointed pursuant to s 1323 of the corporations act 2001 (cth) public regulatory function protective of company assets pending australian investments and securities commission investigation application by company for approval for expenditure on legal fees relating to possible action against receivers no potential cause of action or merits disclosed clear case necessary to justify such an order risk of inappropriate pressure on receivers in discharge of public function motion for approval of expenditure dismissed corporations |
They are citizens of India. They applied for a protection visa under the Migration Act 1958 (Cth) (the Act) on 16 June 2006, based upon the principal appellant's claim to have a well-founded fear of persecution by reason of his membership of a particular social group, or his religion, or possibly by reason of his political opinion. 2 The essence of his claims to have that fear, and so to be a person to whom Australia owed protection obligations under s 36(2) of the Act, arose from what, he claimed, had happened to him in his community in the city of Ahmedabad in the state of Gujarat between 2002 and 2006. 3 The appellant claimed to have been an active participant in Hindu religious activities in his community and to have been an active member of the Vishwa Hindu Parishad (VHP) community organisation. He claimed that in Ahmedabad there are some Muslim dominated areas and riots involving Hindus and Muslims frequently occurred. In February 2002, he referred to some communal violence between Hindus and Muslims following an attack on a train near Godhra where more than 100 people died. Subsequently, on 27 February 2002, the shop in which he operated a medicine business and then a jewellery business was burnt down and he and his partner were subjected to threatening phone calls by "unknown Muslim fundamentalists". He claimed that one of the callers said that his shop had been burnt as revenge for the burning of property and lives of Muslims. He claimed that the VHP had attempted unsuccessfully to obtain compensation for the burnt property from the government. He and his partner opened a new business in a different suburb of Ahmedabad, but the threats continued, sometimes as frequently as five times a day between February 2004 and June 2005. Towards the end of June 2005, he left the state of Gujarat, but returned after six months, and again faced the same threats. He further said that on 31 March 2006, he was attacked on his way home from his shop and severely beaten, and warned to leave Gujarat. He said he was warned that if he did not leave Gujarat he would be killed. He reported the matter to the police, but they were unable to offer him any protection. Consequently, he and his wife decided to leave India as they feared being killed by Muslims, or (he added) "by power hungry Hindu fundamentalists. " He claimed that the Indian police would be unable to protect him. He claimed to have tried to relocate elsewhere within India without success. 4 The appellant's claim was rejected by a delegate of the first respondent on 7 July 2006. That decision was affirmed by the Refugee Review Tribunal (the Tribunal) on 29 November 2006. 5 The Tribunal identified his claim as being because he is a Hindu or because of his association with the Hindu community organisation VHF, and so was founded on a fear of persecution on religious grounds or his membership of the Hindu community, and to the extent that the VHF involved itself in social and political issues, potentially on the claim based upon his political opinion. However one categorises the motives of the alleged persecutors, it was the first step in the Tribunal's reasoning to consider whether the conduct complained of had occurred. The Tribunal accepted that there was ongoing communal tensions in Ahmedabad between the Muslim and the Hindu communities. It accepted the fact of the riots in Godhra following the attack on the train. It accepted that in the community riots which followed, shops belonging to Hindus and Muslims alike were burnt. It also accepted that the appellant owned a business that was burnt during the communal strife in Gujarat in 2002. It accepted that the appellant was a member of the VHP in Ahmedabad. Then, although the Tribunal said that it did not accept the basis of any of those claims, "for reasons that follow", its reasons indicate in fact that it assumed in favour of the appellant, despite doubts about the veracity in particular of him being attacked on 31 March 2006, that he had been attacked on that day by Muslim assailants. Even if one accepted that the applicant's business was targeted for any of the Convention reasons, this will not assist his case. This is because, these events occurred in 2002. There is no credible evidence before the Tribunal that since than [sic] the applicant has been subject to further persecution. 7 It is hard to understand the Tribunal's reasons in respect of the period between 2002 and 2006. The observation that there was no credible evidence before the Tribunal that since 2002 the appellant had been subject to further persecution ignores his own evidence. The Tribunal has not assessed the reliability of that evidence. It may have assumed that the threats continued, or it may not. Earlier in its reasons, in reciting the course of the hearing, the Tribunal recorded that it had told the appellant that the issue was whether he could relocate to another part of India, rather than about whether his complaints of persecution were accepted. 8 Although the Tribunal's reasons are therefore somewhat contradictory and incomplete, I construe the Tribunal's reasons overall as assuming in the appellant's favour that he suffered the ongoing threats between 2002 and 2006, including the more intense threats from 2004, which he reported. I shall proceed on the basis that it did so. If that is an inappropriate assumption, in my view the Tribunal's reasons are inadequate to explain what it found about the reports of those threats. As the issue of relocation is an independent reason for the appellant's claim having failed before the Tribunal, if it is shown to have fallen into jurisdictional error on the relocation issue, it will be necessary to revisit the consequences of the apparent failings in the Tribunal's reasons to which I have referred. 9 The Tribunal then rejected the appellant's claim because it concluded that he is reasonably capable of relocating to other parts of India if he faces persecution from Muslim fundamentalists in his city of Ahmedabad. After referring to the relocation principle discussed in Randhawa v Minister for Immigration, Local Government and Ethnic Affairs (1994) 52 FCR 437, the Tribunal observed that it did not see any impediment to the appellant's relocation to other parts of India. It explained why. It did not think that the appellant had given the Tribunal any persuasive reason why he should feel uncomfortable in setting up his business in other parts of India. It noted that there was no rational basis for the appellant's claimed belief that he and his wife would not be entitled to the same protection as other business people in other major cities in India. Even if he could not afford to set up business in another city, it noted that the appellant is currently employed in Australia as a farm hand, and is also skilled as a medicine salesman and a diamond polisher. It therefore concluded that he is easily capable of taking up other types of work without the necessity of establishing his own business. It rejected his claim that he had unsuccessfully attempted to relocate in the past because he had been unable to tell the Tribunal where he had tried to relocate. It concluded that he is reasonably capable of relocating in India, and so did not have a well-founded fear of persecution for a Convention reason if he were to return to India, even if he may have been the subject of further attacks in his city of Ahmedabad. 10 The appellants sought to have the Tribunal decision quashed by a Federal Magistrate. That application was refused by a decision of a Federal Magistrate of 3 May 2007. The Federal Magistrate found no jurisdictional error on the part of the Tribunal in the way it had considered the appellant's claims, including the assertion (which was the only specific assertion in the grounds of the application before the Federal Magistrate) that the Tribunal had failed to comply with s 424A of the Act by having failed to give to the appellant a notice under that section addressing the matters to which the Tribunal may have had regard in deciding whether it was reasonable for him to relocate to some other part of India. The Federal Magistrate said that the matters to which the Tribunal had regard in reaching that conclusion was information given by the appellant to the Tribunal during the course of the hearing. 11 This is an appeal from the decision of the Federal Magistrate. 12 Neither in his notice of appeal to this Court, nor in his written or oral submissions on this appeal, did the appellant seek to maintain his complaint of jurisdictional error on the part of the Tribunal based upon a failure to comply with s 424A of the Act. 13 The notice of appeal contains two very general grounds. It asserts a "harsh approach" to the assessment of whether the appellant had a well-founded fear of persecution. If the Tribunal's decision about relocation is not tainted by jurisdictional error, that is an irrelevant matter to this appeal because (as noted above) I have taken the Tribunal to have assumed in favour of the appellant that he had a well-founded fear of persecution for a Convention reason, based upon the matters to which he referred in the course of the hearing before the Tribunal and in his original application for a protection visa. The second ground of appeal in the notice of appeal asserts a failure on the part of the Tribunal to properly apply the test for the existence of a well-founded fear of persecution. The same comments apply. The second ground of appeal is compendious. It also asserts a denial of natural justice because, it is claimed, the appellant "lost the chance for oral evidence before the Federal Magistrate". The short answer to that point is that the Federal Magistrate was obliged only to inquire into whether there was jurisdictional error on the part of the Tribunal. His Honour's function was not to re-hear and re-determine the merits of the claim. There is nothing to suggest that the Federal Magistrate was asked to hear further evidence on behalf of, or from, the appellant directed to showing some jurisdictional error on the part of the Tribunal. Indeed, there is nothing on this appeal to indicate the nature of the "oral evidence" which the appellant asserts in this ground of appeal that he sought to adduce before the Federal Magistrate, if indeed that occurred at all. 14 The appellant's written submissions also focus in large measure on how the Tribunal applied the "well-founded fear of persecution" test. As I have said, as that matter has been assumed in favour of the appellants by the Tribunal, it is not necessary to address it unless the Tribunal's decision based upon the application of the relocation principle is disturbed. 15 The written submission then addresses the way in which the Tribunal considered the issue of relocation. It is claimed that the Tribunal failed to explore properly the appellant's capacity reasonably to relocate elsewhere in India. The written submission asserts that he did not have the opportunity to fully explain to the Federal Magistrate why the Tribunal erred in that regard because the appellant was told that what he was putting went to the merits of the case and would not show jurisdictional error. The appellant also asserts that, because of his profile, Muslim extremists would target him wherever he was in India so he could not safely relocate anywhere in India. 16 The latter factual assertion was, in reality, the appellant's real contention on the appeal. He did not contend that the Tribunal had misdirected itself as to the nature of the relocation principle, or that it had misapplied it, upon its findings of fact. What he contended was that his case before the Tribunal was that he had a well-founded fear of persecution throughout India rather than only in his local area, and that the Tribunal had misapprehended his claim in that regard. I do not consider that the Tribunal did misapprehend the relocation principle, or misapply it upon its findings of fact, so that I would dismiss the appeal subject to considering that further contention of the appellant. 17 There is a further reason why, in my judgment, the appeal (again subject to considering that further contention) should be dismissed, to which I shall refer at the conclusion of these reasons. 18 The first step in considering the appellant's contention that his case was that he had a well-founded fear of persecution for a Convention reason throughout India, because he would be a target for Muslim fundamentalists wherever he was located in India, is to decide whether the appellant should be entitled to raise that matter on this appeal. It was not raised as a ground of appeal before the Federal Magistrate, nor in the grounds of appeal before this Court. Leave to amend a notice of appeal to raise a new ground should only be granted where it is expedient in the interests of justice for that leave to be granted: NAJT v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 134 ; (2005) 147 FCR 51 at [163] --- [166]; VAAC v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 74 ; (2003) 129 FCR 168 at 177; NBKT v Minister for Immigration and Multicultural Affairs [2006] FCAFC 195 ; (2006) 156 FCR 419 at [22] . 19 In NAJT 147 FCR at [166] Madgwick J identified relevant questions on the topic as including whether the new legal argument has a reasonable prospect of success; whether there is an acceptable explanation of why it was not raised before the Federal Magistrate; whether permitting the new ground to be raised would interfere with the efficient use of judicial sitting time; the consequences to the appellant of not permitting the new ground to be raised and to the first respondent in permitting the proposed new ground of appeal to be raised and, if so, how it could be cured; and where the interests of justice lie in all the circumstances. 20 The appellant's application for a protection visa asserts in very general terms that he fears being killed by criminal Muslim fundamentalists in India if he were to return there, and refers specifically to a letter of 16 June 2006 in which he expands upon that information. That letter records the complaints of particular adverse experiences to which the Tribunal has referred in the Gujarat state. It is specific to that state. If we go back to India, We can be killed by Muslims or maybe even by power hungry Hindu fundamentalists. Indian police can never protect us. It is focused upon events in and around Ahmedabad. We were living in a fearful situation. Hiding here and there and begging safety of life from the local police. The local police did not give any solid or effective protection. Because of that we left our country to have a peaceful life. But we are not agreed with the Delegate of the Minister that the Hindus are everywhere in India are protected by the ruling authorities. It may be noted that in Punjab and the Kashmir, the Hindus live like second-class citizens and always have fear of life. Killing of Hundreds of Hindus in Kashmir is reported in the News media. ... We tried best to relocate our self in other parts of India but we could not get success. At present, there is always fear of riots. There is a genuine fear of persecution from the fundamentalist Muslim and the Government cannot give effective protection to us. The Congress runs the Central Government. The Politicians are always looking to get the chance to grab the power. The Central Government is reluctant to take any effective steps to root out these problems from Gujarat. In that situation we are very fearful. We have lost the confidence in the state government's efforts to stop killings in Gujarat. We are not protected. If we are forced to go back to our country the Fundamentalist Muslims may kill us and we cannot get an effective protection from the Hindu Government. The Tribunal recorded at some length an exchange with the appellant about relocation in India. The Tribunal asked him why he did not relocate to another part of India. He said in the political atmosphere it was not possible to establish his business. He said he did not feel comfortable to establish his business given the tensions in other parts of India. He claimed that in India the politicians and the police cannot help. The Tribunal asked him to explain himself further. He said the government never supported him and his wife. The Tribunal asked why he and [his] wife could not do business like any other business persons in a city such as Mumbai or Madras. He said he did not have that much money to establish himself in a big city such as Mumbai. The Tribunal put it to him that is hardly persuasive because he has travelled all the way to come to Australia and if he could set himself up in a foreign country why could he not do so in another city in India. He said he could not; that is why he has come to Australia. The applicant said that he could provide insurance and related documents to show that he operated a business in India. He could also [have] provided documents to show that his shop was burnt and that he reported the incident to the police. He could also provide documents to show that he was a VHP member. The Tribunal indicated to the applicant that the documents are not critical because the Tribunal accepts that it is more probable than not that he was a member of the VHP and that he operated a business which could have been burnt during the riots. The Tribunal is also willing to accept that that like any property owner he would have tried to lodge an insurance claim and a complaint with the police. The Tribunal then noted to him that the issue is whether he could relocate in another part of India. He said he could not relocate because he is very 'upset in his mind'. He had ample opportunity to then identify to the Tribunal that his concern was of persecution in a more widespread geographical area than Gujarat state. When considering the issue of relocation, the Tribunal took each of the appellant's responses in the passage referred to and addressed them before concluding that the appellant could reasonably be expected to relocate within India away from Gujarat state. 25 When those matters were pointed out to the appellant in the course of his oral submissions, he responded that he considered that the Tribunal record of hearing was not correct. He was asked why he had not challenged its accuracy earlier in any submissions or other documents or in the proceedings before the Federal Magistrate. He said he had not corrected it, and so had not sought to raise that as a ground of appeal before the Federal Magistrate or before this Court, because he had not previously had the opportunity of reading the Tribunal's reasons and had only read them today with the support of the interpreter provided by the Court for the hearing. However, he then acknowledged that he had prepared the written submission to which reference has already been made. When it was pointed out to him that the written submission contains another extract from the Tribunal's reasons, he did not repeat his assertion that he had not read those reasons as his explanation for not having raised the matter earlier and he provided no other reason why he had not previously raised the matter in the grounds of appeal or in his written submission. 26 The Tribunal, when considering the appellant's various responses to why he could not reasonably be expected to relocate elsewhere within India, did address his claimed belief that politicians and the police would not protect him and his wife in other parts of India. The Tribunal recorded that it pointed out to him that there is no rational basis for the belief that he and his wife would not be entitled to the same protection as other business people in other major cities in India. 27 There can be no doubt that, in my view, the appellant was well aware of the Tribunal's understanding of his fears of persecution being focused upon the Gujarat province, and that it was considering as a separate and consequential issue whether the appellants could reasonably relocate elsewhere in India. That understanding of the appellant's claim was reasonably open to the Tribunal. At the times when the appellant could have corrected the Tribunal's understanding of the nature of his claim, if it was a misunderstanding, the appellant did not do so. There is no satisfactory explanation for why he did not do so. Nor is there any satisfactory explanation for not having raised that complaint before the Federal Magistrate; his explanation offered upon questioning during the course of his submissions was obviously an unacceptable one. How the proceeding was conducted before the Federal Magistrate cannot, of course, inform the proper understanding of the Tribunal about the appellant's claims, but it is surprising that the matter was not then raised if it was an element of his claims to the Tribunal which was not addressed. 28 The appellant resorted simply to repeating that he could not relocate within India because if fundamentalist Muslims found out where he was, they would chase him and kill him. 29 The Tribunal is obliged to consider each of the claims which an applicant for a protection visa makes. In this instance, in my view, the Tribunal reasonably understood the appellant as having complained of a well-founded fear of persecution by reason of his involvement with the VHF in his home state of Gujarat. The Tribunal proceeded upon that basis, and in the hearing the appellant did not take the opportunity which was clearly presented to him to indicate that his fear related to such persecution much more widely than the Gujarat state. Accordingly, in my view, the Tribunal was not called upon to decide the matter which the appellant now asserts is the foundation of his well-founded fear of persecution and which is the reason why he now says that the issue of relocation was inappropriately addressed by the Tribunal because it did not, on his case, arise to be considered. 30 I would not, therefore, give the appellant leave to amend the notice of appeal to now raise that point. 31 There is another reason why, in any event, in my judgment, the appellant's claim is inevitably doomed to failure (even if as widely expressed as he now asserts). That is because, as the Tribunal remarked, there is no reason to consider that the Indian authorities would not provide an appropriate level of protection to the appellant at least outside of the state of Gujarat. Day by day, Australian courts deal with criminal cases involving violent attacks on person or property. Some of them may occur for reasons of racial or religious intolerance. The religious activities in which the first respondent engaged between May and December 1998 evidently aroused the anger of some other people. Their response was unlawful. The Ukrainian state was obliged to take reasonable measures to protect the lives and safety of its citizens, and those measures would include an appropriate criminal law, and the provision of a reasonably effective and impartial police force and justice system. None of the country information before the Tribunal justified a conclusion that there was a failure on the part of the Ukraine to conform to its obligations in that respect. There is no evidence upon which the Tribunal could have found, even if the appellant were at risk of Muslim fundamentalists throughout India, that the Republic of India did not provide reasonable measures to protect the lives and safety of its citizens including providing an appropriate criminal law and the provision of a reasonably effective and impartial police force and justice system. Consequently, even if the appellant were able to show (contrary to what is clearly the Tribunal's conclusion of fact) that he was at risk of attack by Muslim fundamentalists throughout India, there is no basis upon which he could show that that non-state threat was one in which the Indian state itself was complicit, or in respect of which the Indian state did not provide an appropriate level of protection by police and other authorities. 33 I have also independently considered whether there is some other basis upon which the appellant might have demonstrated jurisdictional error on the part of the Tribunal. Section 425(1) of the Act obliges the Tribunal to have invited the appellant to give evidence and present arguments relating to the issues arising in relation to the decision under review. As the High Court (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ) pointed out in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 ; (2006) 231 ALR 592 at [33] , the reference to "the issues arising in relation to the decision under review" is important. The issue of relocation was therefore an important one, but it was, as the Tribunal's record of hearing as exposed in its reasons for decision illustrates, raised fairly and squarely before the appellant. Moreover, even if "the issues" to be the subject of a hearing are more refined, and extend to particular factual matters which may go to the question of reasonableness of relocation, in this instance in my judgment the Tribunal adequately gave the appellant the opportunity to address those factual matters. In particular, it put to him that he had travelled to Australia and that, if he were able to set himself up in Australia, there is no reason why he should not be able to do so in another city in India. 34 For those reasons, in my judgment, the appeal must be dismissed. The appellant is to pay to the first respondent the costs of the appeal. I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Mansfield. | appeal from decision of federal magistrate whether decision of refugee review tribunal contained jurisdictional error whether reasonable for appellant to relocate whether refugee review tribunal complied with obligations under s 425(1) of the migration act 1958 (cth) whether refugee review tribunal sufficiently identified issues arising on the review migration |
None of the documents filed in support of the application for leave to appeal isolates any arguable error on the part of the Magistrate. The applicant relies upon the fact that he did not attend, or was not given notice to attend the Tribunal's hearing. That matter was examined by the learned Federal Magistrate and determined contrary to the position of the applicant, based upon evidence which was set out in the judgment. The applicant has not pointed to any appealable error in the manner in which that issue was determined against him. 2 The learned Federal Magistrate also said that the gross delay in the proceeding would have been a proper basis to dismiss the matter peremptorily in any event. The applicant arrived in Australia on 4 May 1997. The Tribunal's decision affirming the Delegate's decision to decline the application for a protection visa was handed down on 14 September 1998. The application for review was filed in the Federal Magistrates Court on 29 September 2005. In my opinion, that is also a sound basis for dismissing the proceeding. 3 I can see no possible argument that the decision here could be successfully attacked upon appeal. I therefore dismiss the application for leave. I order that the applicant pay the costs of the first respondent. I certify that the preceding three (3) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles. | application for leave to appeal dismissed migration |
The applicant was and remains unrepresented. 2 The proceeding before the Federal Court was commenced by way of notice of appeal filed by the applicant on 3 January 2007. Originally the respondents appearing on the notice of appeal were the 'Department of Family and Community Services' and the 'Department of Human Resources and Health', as well as the Tribunal. When the proceeding first came before this Court for directions, which was on 6 February 2007, Mr Kunc of counsel appeared for the Department of Family and Community Services and Ms Pownall appeared on behalf of the Department of Human Resources. Mr Druett appeared in person, and purported to appear on behalf of his four children as well as himself. He was not accompanied by any of his children on either occasion. 3 Mr Kunc explained to the Court on that earlier occasion that the applicant held many grievances against public authorities and that the Tribunal had been unable to identify those grievances as having been caused by the conduct of any relevant Commonwealth instrumentality falling within the jurisdiction of the Tribunal. Mr Kunc and Ms Pownall made an application on behalf of their respective clients, then being second and third respondents to the proceeding, that they should cease to be parties to the proceeding, since they were not parties to the original proceeding before the Tribunal. I granted that application and made orders to that effect pursuant to O 6 r 9 of the Federal Court Rules . Hence the sole remaining respondent to the proceeding is the Tribunal. 4 It is readily apparent that what remains of the purported appeal against the Tribunal's decision of 4 December 2006 must inevitably be dismissed for the reason that no juridical basis for the pursuit thereof is evident or apparent from the content of the notice of appeal or from the submissions, both written and oral, put forward by the applicant to the Court. Since the Tribunal entered a submitting appearance and there was no appearance made at the hearing of the proceeding by the named respondent to the proceeding, the occasion for any order as to the costs of the appeal does not arise. 5 Nevertheless there are several observations which I think are appropriate to make and which may be of assistance in the context of what appears to have been protracted circumstances which have evidently caused distress to Mr Druett. In so doing I do not make any criticism, directly or indirectly, of any person or government instrumentality. Mr Druett spoke of the circumstances to which I have referred in the context of his present purported appeal to this Court. He appeared to indicate that his purpose in pursuing the present and various prior legal proceedings had been primarily occasioned by his concern to achieve some extent of communication with his four children, whom he has not apparently seen since about 2002. His three youngest children, aged about 11, 12 and 13 years, were said to be in foster care, whilst his eldest child, aged about 15 years, was said to be in the care of a relative and the Bankstown Catholic Church. His marriage to the mother of his four children was apparently dissolved some time ago and Mr Druett lives alone. He is presently employed in casual work, and has been previously employed in warehousing, cleaning and security contexts. 6 I have recorded these matters in case the applicant might be able to obtain some measure of assistance from Government and Church authorities by way of meeting with and participation in some role or activity with his children, however restricted, in what remains of their youthful years. The extent to which he had pursued different legal remedies, albeit without success, tends to indicate a genuine paternal concern on his part. I am able to record, in the context of this Court's relatively brief engagement with the applicant in the course of the present proceeding, that he presented as a polite, subdued and pleasant, albeit distressed, person who earnestly seeks the opportunity of having some encounter or involvement in the lives of at least his three youngest children by way of some measure of access to them. It may well be of considerable assistance and benefit to this distressed and seemingly sincere person if the relevant State and/or Church authorities, which may be involved already in the welfare of his youngest three children, could enable this person to have access to and dialogue with his children, at least to the limited extent which he appears to earnestly seek. 7 Irrespective of the foregoing observations, this Court has of course no function or role open to be undertaken or performed at the instance of the applicant, no viable cause of action or other process having been conceivably articulated by the applicant. For that reason I must dismiss the present appeal, the bringing of which is misconceived in any legal sense. I would not presume to intrude further other than to make the observations which above appear. 8 No order for the costs of the appeal need be made in the light of what has been already involved. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. The Respondent did not appear. | jurisdiction of administrative appeals tribunal no reviewable decision identified administrative law |
They concern correspondence sent to the Human Rights and Equal Opportunity Commission ("the Commission") by the applicant in late 2005. In a letter dated 26 September 2005, the applicant wrote to the Commission concerning allegations of unlawful discrimination. The Commission replied in a letter dated 7 October 2005, in which it indicated that it was not able to assist her. On 13 October 2005, the applicant again wrote to the Commission. That letter addressed alleged breaches of human rights. The applicant wrote to the Commission a third time on 7 November 2005, this time concerning allegations of sexual harassment. The Commission did not respond to the second and third letters it received from the applicant. 2 It is now accepted in these proceedings in which the Commonwealth Attorney-General has intervened to act as a contradictor, that the Commission either failed to respond or responded inappropriately to the applicant's correspondence. Accordingly, it is accepted by the respondents and the Attorney-General that in these two applications it is appropriate that orders be made. It was suggested by the second respondent and the Attorney-General that orders with substantial operative effect should be made only in matter NSD 1957 of 2005, that is orders made setting aside what had been done by the Commission. As to NSD 2340 of 2005, it was proposed that the application be dismissed. In my opinion, however, the preferable course is for orders to be made in both matters, even though this may involve duplication, in terms of the ultimate legal effect of such orders. 3 One point of difference between the applicant and the respondents and the Attorney-General as to what orders should be made concerns whether orders should be made requiring the President of the Commission ("the President") to exercise certain powers in relation to some of the complaints. The statutory scheme involves the lodgement of certain complaints, relevantly, unlawful discrimination and sexual harassment, and the referral of the complaints to the President under s 46PD of the Human Rights and Equal Opportunity Commission Act 1986 (Cth) ("the HREOC Act "). Thereafter the Act requires the President to inquire and attempt to conciliate. That obligation is found in s 46PF of the HREOC Act . However, that general duty is qualified by the power conferred on the President by s 46PH to terminate a complaint for one or more of the nominated grounds. 4 The applicant has submitted that in addition to any order requiring the Commission to refer some of her complaints to the President under s 46PD of the HREOC Act , there should be orders made requiring the President to inquire and attempt to conciliate under s 46PF and certain other orders concerning attendant powers of the President, including holding a conference under s 46PJ. 5 In my opinion, it is sufficient that an order be made requiring the Commission to refer the matter to the President. I am of that view for two reasons. Firstly, although this is a subsidiary issue, the President is not presently a party to these proceedings. The utility of an order requiring the President to do some act under s 46P and later provisions, in the absence of the President being a party, is questionable. However, that procedural deficiency could, of course, be remedied by the joinder of the President. 6 The more significant reason why I do not propose to make the orders sought by the applicant is that the HREOC Act itself directs the President to do certain things upon the referral to him or her of a complaint under s 46PD. It seems unnecessary and probably inappropriate for this Court to make an order requiring the President to do that which the Act requires the President to do. In addition, some of the orders sought by the applicant presuppose that the matter will be dealt with by the President in a particular way. They presuppose, for example, that the President will not exercise the power under s 46PH. That power is a discretionary power available to the President and it would be inappropriate to make an order that assumes it will not be exercised. 7 Accordingly, I propose to make an order only that the complaints be referred to the President. It will then be a matter for the President to determine what powers are exercised and the manner in which they are exercised consistent with the statutory scheme which prima facie requires the President to inquire into and attempt to conciliate the complaint. 8 Insofar as the complaint involving an allegation of a breach of human rights is concerned, it is accepted by the respondents that an appropriate order is that the matter be remitted to the Commission to be dealt with in accordance with s 20(1)(b). That paragraph provides that the Commission is required to perform certain functions identified in s 11(1)(f) , namely to inquire into any act or practice that may be inconsistent with or contrary to any human right, and consequential conduct. 9 The order proposed by the Attorney-General on his behalf and on behalf of the respondents is sufficiently prescriptive to enliven the processes flowing from s 20(1) of the HREOC Act (which, subject to s 20(2), places an obligation on the Commission to perform the functions referred to in s 11(f)). 10 Another matter is an application by the applicant that her name be suppressed. Also, the applicant requested that orders be made in matter NSD 2340 of 2005 directed to the respondents concerning the matters to which the complaints relate and restraining their conduct. 11 Dealing with that second matter, it seems inappropriate to make the orders sought. The power to do so is found in s 16(1)(d) of the AD(JR) Act which empowers the Court to make an order relevantly directing a party to refrain from doing any act or thing. That power is enlivened where the Court considers it is necessary to do justice between the parties. I am not affirmatively satisfied that the orders sought are orders that are necessary to do justice between the parties. 12 Insofar as the alleged conduct of the second respondent is concerned, that is the matter that is the subject of complaint and it is appropriate that the procedures under the HREOC Act and related legislation be allowed to operate. As to the other orders proposed by the applicant are concerned, I am not satisfied they are necessary to do justice between the parties. 13 In relation to the proposed order suppressing the name of the applicant, the power to make such an order is found in s 50 of the Federal Court of Australia Act 1976 (Cth) ("the FCA Act "). Such an order can be made by the Court if it is of the view it is necessary in order to prevent prejudice to the administration of justice. As counsel for the second respondent and the Attorney-General said, the ordinary position is that such orders are not made and the C-ourt needs to be affirmatively satisfied that the suppression or non-disclosure order is necessary. 14 The applicant has elected to bring these applications, as she is entitled to do. It is true that, in effect, the Commission has accepted that her earlier complaints have not been dealt with in accordance with the legislative regime. In those circumstances, the applicant, has been required to avail herself of the Court's procedures and processes to vindicate her rights under the HREOC Act to have complaints dealt with in accordance with the legislative scheme. However, in my view, that is not a sufficient reason to make an order under s 50 of the FCA Act . The published reasons of this Court, which will reveal her name, are limited to a broad description of the various complaints she has sought to have the Commission investigate. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. | no point of principle administrative law and human rights |
I also requested the parties to provide submissions as to whether the Court should grant access to several media organisations to documents on the file. Pursuant to O 46 r 6(1) of the Federal Court Rules a person may inspect certain types of documents on a Court file unless a Judge orders that the document is confidential. Under O 46 r 6(3), a person must not inspect certain other types of documents (of an evidentiary nature) without leave of the Court. 2 The Court has received submissions from both parties. In addition, Zurich Financial Service Australia Limited ('ZFSA') and Zurich Australian Insurance Limited ('ZAIL') have sought leave to intervene on these issues, and have provided submissions to the Court. Pursuant to O 6 r 17 of the Federal Court Rules , the Court may give leave to a person to intervene in proceedings. I am satisfied that ZFSA and ZAIL should be granted leave to intervene in relation to the issues of the continuation of the s 50 order and the grant of access to the file. Again, we are familiar with cases where an order forbidding or restricting publication is appropriate. Thus, where the proceedings concern a secret process and publication of the process would destroy the subject matter of the proceedings and render them nugatory, an order is necessary to prevent prejudice to the administration of justice. Where proceedings are brought to restrain publication of confidential material, similar considerations apply. Disclosure would prejudice the court's proper exercise of the function it was appointed to discharge, to do justice between the parties. The possible cases where an order may be necessary to prevent prejudice to the administration of justice range fairly widely. Firstly, it says that certain documents have not been admitted into evidence. Secondly, it says that certain documents contain information which it would be an offence to disclose under s 56(2) of the Australian Prudential Regulation Authority Act 1998 (Cth) ('APRA Act'). Thirdly, it says that certain documents were supplied to the applicant subject to non-disclosure conditions under s 56(5)(b) of the APRA Act. Fourthly, it says certain documents are subject to a duty of confidentiality pursuant to s 60 of the Insurance Act 1973 (Cth). Fifthly, it says that certain documents contain information about third parties, the disclosure of which may damage reputations or result in a denial of procedural fairness by APRA. Sixthly, it says that certain documents disclose the investigative processes of APRA. 9 I do not consider that the first reason provides a basis for excluding documents under s 50 of the Federal Court of Australia Act 1976 (Cth). Given the principle of open justice, the fact that documents have not been admitted into evidence would not be sufficient to justify a prohibition on their publication. Pleadings are subject to O 46 r 6(1). Third parties are entitled to access pleadings unless the Court has ordered that they are confidential. The case law relating to documents subject to O 46 r 6(2) is somewhat different. Nonetheless, the principle which emerges from the above is the fact that material contains allegations which are untested this does not of itself justify an order under s 50. 11 For similar reasons, I do not consider that the fifth reason proposed by APRA is sufficient to justify the continuation of an order under s 50. Unfortunate though it may be, the fact that the reputations of certain individuals may be damaged by documents is not of itself a reason for restricting their publication by an order under s 50. The damage to an individual must be weighed against the importance of maintaining open justice and public confidence in the justice system. In my opinion, it would prejudice the administration of justice if documents were revealed to which restrictions under s 56 of the APRA Act applied. The Court cannot require the production of these documents and they were provided to the applicant and to the Court subject to confidentiality requirements. It would vitiate my decision of 26 May 2006 relating to the effect of that section if those documents which were ' protected documents ' or contained ' protected information ' were allowed to be published by the Court. 13 Apart from the question of statutory prohibition, these documents were provided by the respondent to the applicant on a confidential basis. Documents which the Court could not have ordered be provided to a party or to the Court, and which are provided voluntarily on a confidential basis to a party, should not in my opinion be released to non-parties by the Court. Although documents created by the applicant in response to the reports may not, in all cases, be themselves covered by the operation of s 56, it would, in my opinion, undermine the operation of s 56 if they were not also restrained from publication. Further, it would be likely that organisations such as APRA would cease to provide such documents to external interested parties if they could not ensure that confidentiality of the material contained within them would be maintained. 15 I accept that in some circumstances, documents which disclose the investigative processes of APRA might be appropriately restrained from publication. In the present case, however, having considered those documents which fall outside the restrictions already discussed, I do not consider that the material contains significant details which would prejudice APRA's conduct of future investigations if it were publicly revealed. Accordingly, I do not consider that any additional material should be withheld by order under s 50 on the basis that it reveals APRA's investigative processes. 16 In respect of the suggestion that a duty of confidentiality applies by virtue of s 60 of the Insurance Act 1973 (Cth), I agree with this submission but only to a limited extent. I accept that information relating to the contents of the final report would be subject to a duty of confidentiality, on the basis that publication is prohibited without the agreement of the Attorney-General. It is possible that this duty would extend also to the contents of the draft reports, but it is unnecessary to decide this point at present since s 56 of the APRA Act applies to the draft reports. However I do not consider that s 60 of the Insurance Act would prevent the applicant disclosing his knowledge of the investigation by APRA outside of these parameters. 17 I have read the file and considered the documents contained in it. I propose to amend order 8 of the orders of 14 July 2006 to restrict its operation to those portions of the documents which I believe fall into one of the two categories referred to above (namely, documents to which s 56 of the APRA Act applies, or documents derived from documents to which s 56 applies). Because of the nature of the documents in question, I have prepared a schedule of those documents to which I consider the s 50 order should continue to apply. Any further documents filed in the proceedings will need to be subject to consideration on a case-by-case basis. Obviously, the Court will not grant access to any part of a document to which an order under s 50 applies. However, there are further considerations which may require access to be restricted, at this point in time, to documents which will not be the subject of the order I now propose to make under s 50. 19 It is important to bear in mind that the application before this Court is an application for preliminary discovery. Further, only an interlocutory hearing has taken place, so the ultimate merits of the applicant's preliminary discovery claim have not yet been considered and much of the evidence filed in the proceedings has not yet been read in open court. In giving the answer I propose to confine myself to those cases where a non-party seeks access to material which has been relied upon by the judge. In such a case I have no doubt that the proper approach is that access should be allowed unless the interests of justice require a different course. It is only by adopting this approach that, in a practical sense, the principle of open justice will be preserved. Put differently, in my view there is a strong presumption in favour of allowing any member of the public who wishes to do so to inspect any document or thing that is put into evidence. Inspection should only be refused in exceptional circumstances. I think that the position is a fortiori when the material has been read by the judge in private and is not read out in court. If that material is not made available for inspection then the manner in which the case has been conducted will only be known to the parties. That is an unacceptable position. For example, as Santow J recognised in eisa Ltd v Brady, there is a risk of serious injustice if untested allegations contained in affidavits or pleadings can be published to the world at large without the usual constraints of defamation law applying. I say 'ordinarily' because the circumstances of each case will vary and the exercise of the discretion under O 46, r 6 of the Rules will have to take into account the particular circumstances of the case. I agree ... that a convenient touchstone for determining the question of access by non-parties is whether the documents or other material have been admitted into evidence. In general, the application of this principle will serve the interests of open justice. Pursuant to O 46 r 6(1) of the Federal Court Rules , a non-party will generally be entitled to access the pleadings. Accordingly I do not consider the comments of Santow J in eisa Ltd v Brady and Ors [2000] NSWSC 929 at [20] are applicable to this Court in so far as they apply to pleadings. However, in respect of affidavit material which has not been read in Court, the comments of Santow J in respect of affidavits accord with the principle outlined by Sackville J in Macquarie Radio and Seven Network . 24 None of the affidavits filed by the applicant have been admitted into evidence except for the affidavit of Stephen Mark Gorry sworn 24 July 2006, which was admitted to evidence on 11 August 2006, subsequent to the provision of submissions upon this matter. 25 Each of the affidavits filed by the respondents, being the affidavit of Mark David Godfrey sworn 21 February 2006, and affidavits of Brett Gregory McKenzie-Craig sworn 21 February 2006, 20 March 2006 and 7 April 2006, have been admitted into evidence. 26 In accordance with the principles outlined above, the appropriate course would usually be for leave to be granted to access those affidavits which have been admitted into evidence, but not be otherwise granted. 27 The applicant submits that even though the respondent's affidavits have been read in open court, because they have been read only on an interlocutory application they remain untested. The applicant claims that it would be unfair for the Court to grant media access to the affidavits filed by the respondent if access is not also granted to the affidavits of the applicant, and submits that accordingly, the Court should not grant access to any of the evidence. 28 I am not convinced that there is any real risk of significant damage to the applicant's reputation arising from those portions of the respondent's affidavits which I propose to release. It could not be said that the respondent's affidavits contain ' untested allegations ' which relate specifically to the applicant. Accordingly, I am not satisfied that this should prevent leave being granted to access those affidavits. 29 Accordingly, subject to continuing publication restrictions arising from the order made under s 50 of the Federal Court Act, I propose to grant leave to the applicant media organisations to access those affidavits which have been admitted into evidence. In order to avoid confusion concerning what has, and has not, been released, I have prepared a second schedule which specifically indicates those portions of the file in respect of which leave is granted. The second schedule is divided into two portions. The first part lists documents to which access is granted immediately upon the order having effect (subject to those portions which are embargoed). The second part lists documents over which leave is granted if they are admitted into evidence. 30 In order that the parties may have an opportunity to consider the effect of these reasons, I propose to make these orders effective as from 4 pm on Tuesday 12 September 2006. | order under s 50 of the federal court of australia act 1976 (cth) whether order should continue application of australian prudential regulation authority act 1998 (cth) and insurance act 1973 (cth) material supplied subject to obligations of confidentiality where court has no power to order production whether access to evidence on the court file should be granted to media organisations whether evidence admitted in court practice and procedure |
I did not then deal with any issue of costs. The respondent has now sought costs of the proceedings under the HREOC Act. It does not seek any costs of proceedings under the WR Act. The Respondent offers to compromise the claims of the Applicant in both proceedings 877 of 2006, and 1948 of 2006, on the terms outlined in this offer of compromise. This offer is only for the settlement of both proceedings, and the Respondent states that pursuant to the terms of this offer, the Applicant cannot elect to only compromise one proceeding. The claim outlined in matter 1948 of 2006 be dismissed with no order as to costs. This offer shall remain open for acceptance by the Applicant for a period of 21 days from the date hereof, at which time it will lapse. This offer is made pursuant to part 23 of the Federal Court Rules . In the alternative to order 1 above, the Applicant pay the Respondent's costs of proceedings 1948 of 2006 on a party-party basis. 3. Where costs were incurred in the preparation for and Hearing of matter No. 1948 of 2006 together with matter 887 of 2006, including the preparation of Submissions, the Respondent shall be entitled to 75 percent of their costs of and incidental to those hearing days and submissions. Counsel for Ms Thompson argued that Bahonko v Sterjov (and Seven Network v MEAA [2004] FCA 637 ; (2004) 148 FCR 145 , which it approved) was wrongly decided. The argument was based on a passage in the judgment of Black CJ in Goldman Sachs JB Were Services Pty Limited v Nikolich [2007] FCAFC 120 ; (2007) 163 FCR 62 ( 'Nikolich' ) (at [93]-[94]). However, it is clear that his Honour's observations were concentrated upon the position concerning causes in the accrued jurisdiction. They were made in a context where his Honour had drawn attention to, and accepted, a submission that a distinction might be drawn between s 170CS of the Workplace Relations Act 1996 (Cth) (as it then stood), which limited costs in 'a proceeding under' that section and s 347 of that Act (as it then stood) which limited costs more generally in 'a proceeding in a matter' under the Act. His Honour did not refer to Seven Network v MEAA or discuss the position of independent statutory claims. In Nikolich the applicant did not succeed at trial on any statutory claim. He succeeded on a common law claim in the accrued jurisdiction. The point which arose in Bahonko v Sterjov , and in the present case, did not arise for consideration. Jessup J was the trial judge in Bahonko v Sterjov . He applied Seven Network v MEAA. He was found to be correct to have done so. The restriction argued by counsel for Ms Thompson can not be accepted. 7 Because the applicant failed altogether, the question of whether indemnity costs should be awarded as a result of the offer of compromise is not dealt with by O 23 r 11 of the Federal Court Rules . The test to be applied is whether Ms Thompson was imprudent or unreasonable (or perhaps plainly unreasonable) to reject the offer of compromise (see McDonald v Parnell Laboratories (Aust) (No 2) (2007) 164 FCR 591 at [21] --- [23]). The difficulty which the respondent faces in its application for indemnity costs is that the only offer it made with respect to the proceedings under the HREOC Act was that the claim be dismissed with no order as to costs. Although I was invited to consider the totality of the offer I think consideration should be confined to the offer made with respect to the proceedings in which the costs order is now sought. The substance of that offer related to protection from costs. Nothing was offered in compromise of the claim itself. I do not need to consider whether such an offer is a real offer of compromise (cf. Williams v Commonwealth Bank of Australia [1995] FCA 992). I do not think it can be said that Ms Thompson was obliged to abandon the case to protect herself against a possible costs order or that she acted unreasonably by not doing so. Accordingly I reject the claim for indemnity costs. 8 However the respondent is, in my view, entitled to have its costs in the HREOC proceedings upon a conventional party-party basis. The claim for costs has been reduced to 75% where costs were incurred in respect of the HREOC proceedings and the WR Act proceedings at the same time. Counsel for Ms Thompson argued that no part of the costs of the proceedings should be regarded as arising from the HREOC Act claim. She contended, effectively, that all of the costs should be attributed to the WR Act claim. In my view that is not a realistic approach to the issue. 9 There is little point discussing again the matters dealt with in the earlier judgment. It should be clear that the substantial proportion of the case related first and foremost to the claim under the HREOC Act. I accept that there was some overlap. The respondent's submission accepts that also. As appears from the first judgment the WR Act proceedings were concentrated upon events which occurred on 4 January 2006 while the HREOC Act proceedings dealt with events which occurred over a period of some months before that date. Most of the evidence was directed to the factual circumstances relied upon in support of the HREOC Act claim. 10 Any apportionment must necessarily be somewhat arbitrary and based upon impression. In my view a fair apportionment, allowing there was a degree of overlap, would be to require Ms Thompson to pay 60% of the costs referrable to both proceedings jointly. Those costs and any costs which relate only to the HREOC proceedings are to be paid on a party/party basis. 11 I will order therefore that the applicant pay the respondent's costs in matter NSD 1948 of 2006 on a party/party basis, provided that where costs were incurred with respect to those proceedings and matter NSD 877 of 2006 together 60% only of the respondent's costs be paid. I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan. | whether indemnity costs should be awarded as a result of an offer of compromise no obligation to abandon a case to avoid costs no unreasonableness established no barrier to the award of costs in a separate statutory claim arises from the workplace relations act 1996 (cth) costs of overlapping issues fixed on a proportional basis practice and procedure |
Under the Act the shares and the notes are securities: s 92(3) (read with definition of "debenture" in s 9) of the Act. The application is opposed by the defendants (the minority shareholders and noteholders). They contend that there are serious and substantive deficiencies in Espasia's application. In particular, the defendants submitted that Espasia has not, and cannot, satisfy certain statutory "threshold" requirements prescribed by the Act. For the reasons that follow, I would approve Espasia's application to compulsory acquire the remaining securities in the Company. The shares and notes are the only securities issued by the Company. Only the shares carry voting rights. Espasia is the trustee of the Dobinson Superannuation Fund (the Fund ). The sole beneficiaries of the Fund are Ross Dobinson and his wife. Neither has any present entitlement to any benefit or payment from the Fund: Re Coram (1992) 36 FCR 250 at 253-255. See too Caboche v Ramsay (1993) 119 ALR 215 at 230; Benson v Cook [2001] FCA 1684 ; (2001) 114 FCR 542 at 550-551, 561 and 572; Cook v Benson [2003] HCA 36 ; (2003) 214 CLR 370 at [35] ; Commissioner of Taxation v Linter Textiles Australia Ltd (in liq) [2005] HCA 20 ; (2005) 220 CLR 592 at [30] ; CPT Custodian Pty Ltd v Commissioner of State Revenue (Vic) [2005] HCA 53 ; (2005) 224 CLR 98 at [25] - [26] . Until 4 May 2009, Espasia held 2,716,680 (or 88.82%) of the issued shares in the Company. On 4 May 2009, Espasia purchased 175,747 shares from Evamaud Pty Ltd (ACN 109 008 193) taking its share holding to 2,892,427 (or 94.58%). Espasia holds all of the shares as trustee of the Fund. The remaining shareholders are the first to seventh defendants who each hold between 16,000 and 38,657 shares. As noted earlier, the Company has also issued 45 notes. Each note is governed by the terms of a Convertible Note Agreement ( CNA ), has a face value of $10,000 (cl 2.2 of the CNA), carries an entitlement to interest and was convertible to a number of shares calculated in accordance with Schedule One of the CNA if the noteholder gave notice to the Company during September 2009 (cll 4.3 and 5.4 of the CNA). Between them, the eighth to sixteenth defendants hold all the notes --- 5 notes each. Espasia holds none. No noteholder gave notice of an intention to convert the notes into shares during September 2009. On 13 May 2009, Espasia obtained an opinion regarding the fair value of the Company's securities (the Report ) from WHK Horwath Corporate Finance Limited ( WHK ). WHK was one of the two experts nominated to provide the report by the Australian Securities and Investments Commission ( ASIC ). The accounts provided to WHK to enable them to prepare the Report disclosed that, as at 31 March 2009, the Company: had assets of $5,068,000 (of which WKH estimated $3,073,900 to $4,045,900 was recoverable); had negative net cash and a net asset deficiency of $2,462,000; owed the National Australia Bank Ltd (the NAB ) $4,725,504.97 which was secured by a fixed and floating charge over the Company's assets and undertaking; owed Espasia $1,266,535.78; and had trading losses of $395,704 in the 2006 financial year, $1,745,434 in the 2007 financial year, $2,909,550 in the 2008 financial year and $2,307,000 in the 9 months to 31 March 2009. The Company's financial position deteriorated further between 31 March 2009 and 18 May 2009 (the relevant date); it made further losses of $278,000 and borrowed $218,712 more from Espasia. Representing a price of less than 0.0006 cents per share. The unsecured ... Notes being acquired are unable to be converted into shares at the September 2009 Final Conversion date based on the current performance of the business and the agreed conversion calculation attached to the ... notes. [The Company] is net asset deficient which can imply nil or nominal value if the equity is valued on that basis. [The Company] has historically been trading at a loss and is showing no signs of improvement in the near future. This can also imply a nil or nominal value in respect of the intangible assets of the business. The Report then went on to consider the value of the Company. Unfortunately, WHK was not consistent in the manner in which it referred to the value of the shares and the notes. The Report concluded that the "fair market value", "fair value" or "value" of an ordinary share was "nil" (eg para 9.1 of the Report) or "nil or nominal value" (eg paras 8.1, 8.3 and 8.5 of the Report). Without Espasia's support, and in the absence of any support from another party, we are of the opinion that the company would be required to review its ability to continue to trade and meet its obligations and pay its debt[s] as and when they fall due and potentially be required to consider appointing Administrators and Receivers. If such an event occurs, we are of the opinion the shareholders and Convertible Noteholders would receive nil value as the level of secured debt far exceeds the fair market value we have assessed of the operating assets. As such, we consider Espasia's offer of 2.22 cents per ... Note in [the Company] to be fair. Espasia's offer was to pay 2.22 cents for each note and 0.0006 cents for each share. an objection to compulsory acquisition form; and a copy of WHK's Report. This proceeding was issued on 20 July 2009. All minority shareholders and noteholders are defendants to this proceeding and were represented. Based on the information we have recently been provided, we understand that Espasia ... is the legal registered owner of the shares in [the Company] and is acting as trustee for [the Fund] which is the beneficial owner of the shares. Section 7.2 of our Report identifies Espasia as holding above the required threshold. In our opinion Espasia (either alone or together with a related body corporate) has full beneficial ownership of at least 90% of the value [of] all securities in [the Company]. For present purposes, some aspects of the statutory framework and the legislative history are worth restating. First, Pt 6A.2 of the Act is "intended to balance the interests of facilitating changes in corporate ownership with the need to protect the rights of minority shareholders": Explanatory Memorandum, Corporate Law Economic Reform Program Bill 1998 (Cth), (the EM ) para 7.1. Secondly, Pt 6A.2 permits all securities (not just shares) to be compulsorily acquired. Consistent with that objective, Pt 6A.2 "allow[s] an overwhelming interest holder of a company to acquire all the outstanding securities in the company (securities in all classes) in situations where the holder can demonstrate an overwhelming interest in the company": para 7.3 of the EM. These benefits can only be obtained where a securities holder has 100 per cent beneficial ownership of all securities in the company. Compulsory acquisition of each class of securities can be difficult where there are a large number of different classes or a small number securities holders in one or more classes, or where there are restrictions on transferring some securities (for example, securities issued under employee share schemes). This will be based upon the market value of the securities and the voting rights in a general meeting. The notice will set out the offer price for the securities to be acquired and be accompanied by an independent expert's report valuing the company as a whole, ... (proposed section 664C). If at least 10 per cent of the securities holders of any one class object to the acquisition, based upon either the valuation of the company as a whole or the offer price for their securities, then court approval of both the valuation and the offer must be obtained. The court's role will be to determine if the offer gives a fair price for the securities (proposed section 664F). It is these objectives (and the statutory enactment of them) which lie at the heart of this dispute and, in particular, the dispute about whether Espasia complied with the "threshold" preconditions to the operation of the compulsory acquisition process, being preconditions in the Act to protect minority shareholders. Two threshold preconditions are relevant --- those set out in ss 664A and 667A of the Act. I will return to consider this issue in further detail below. Section 664C(2) of the Act imposes an obligation on the 90% holder to provide the minority holders with the notice of compulsory acquisition, an objection form and an expert's report or experts' reports under s 667A of the Act. Some of the objections overlap. The defendants submitted that it was not open to Espasia to rely upon (and therefore for the Court to consider) this additional material. I reject that contention for a number of reasons. First, the additional material was served on the defendants, albeit after service of the application. It was not submitted by the defendants that service of the additional material at a later time caused any prejudice to them. Secondly and no less importantly; the defendants objected to the compulsory acquisition. As a result, an application was required to be made and was made to the Court under s 664F for approval of the acquisition of the securities covered by the notice of compulsory acquisition: see [13]-[14]. The issue posed for the Court by s 664F of the Act is whether the 90% holder established that the terms in the notice of compulsory acquisition gave a fair value for the securities. If so, the Court must approve the acquisition of those securities on those terms. Otherwise, the Court must confirm that the acquisition will not take place: s 664F(3) of the Act. If the defendants' submission was accepted, the Court's consideration of whether to approve the application would be limited to the material filed with the application. There is nothing in the Act (including s 664F) or elsewhere that would support such a contention. Moreover, in the absence of a provision like that found in s 459S of the Act (dealing with the contents of an application opposing winding up on the grounds of insolvency), it would not be open to a Court to ignore later relevant evidence including, for example, where a deponent was cross examined. The legislative scheme (see [17]-[21] and [23]-[24] above) strikes a balance between the interests of facilitating changes in corporate ownership with the need to protect the rights of minority shareholders. In the present circumstances, that balance is not tipped in favour of the 90% holder to the detriment of the minority shareholders by permitting Espasia to rely upon the additional material. The minority shareholders' interests remain protected. This ground of objection is rejected. However, the defendants submitted that Espasia was not a 90% holder in relation to the notes. The defendants contend that Espasia does not satisfy s 664A(2) because Espasia does not and cannot satisfy ss 664A(2)(a) and (c). I will deal with each subsection in turn. The answer is yes. At the notice date (18 May 2009), each note contained a mechanism which enabled it to be converted into a number of shares prior to 15 December 2009 (being the maturity date of the CNA) at the election of the noteholder: see [7] above. Relevantly election by notice alone could only be made in September 2009. The number of shares into which each note was convertible was determined by a formula set out in the Schedule to the notes: see [7] above. The defendants submitted that the notes were not convertible into shares because, at the date of the notice of compulsory acquisition, the notes were not immediately convertible into shares and moreover, the notes were not subsequently converted into shares. In support of that submission, the defendants referred to the express words of s 664A(2)(a) and the Report. In relation to s 664A(2)(a) of the Act, the defendants submitted that the phrase "are ... convertible into shares" required that the notes be convertible at the date of the notice of compulsory acquisition. The defendants submitted that if Parliament had intended the statutory regime to permit notes that might be convertible in the future to be compulsorily acquired different language would have been used. In that context, the defendants' counsel referred to s 661A(4)(c) which uses the phrase "will convert, or may be converted, to securities in the bid class". Notes. In my view, the phrase does not require and is not intended to require that at the time of the notice of compulsory acquisition the notes are then convertible. As Espasia submitted, if the defendants' construction of s 664A(2)(a) was accepted, it would render the Part unworkable in important respects, and thus be inconsistent with the purpose for which the Part was enacted --- economic efficiency and ease: EM, cll 1.2 and 1.4; CLERP Paper , p 31. Two examples are sufficient to illustrate the point. First, it would frustrate one of the stated objectives of Pt 6A.2 --- to facilitate compulsory acquisition to enable the "90% holder" to achieve 100% ownership and access the advantages that 100% ownership brings. One important and stated advantage was the ability to gain access to group tax loss treatment under the then s 80G of the Income Tax Assessment Act 1936 (Cth): CLERP Paper, p 27. If the defendants' submissions were accepted it would prevent a 90% holder acquiring the remaining shares in any subsidiary where the financial position of that subsidiary might prevent the notes being converted. The accumulated tax losses would not be able to be utilized by the 90% holder. The purpose of Pt 6A.2 was directed at facilitating these losses, not preventing a 90% holder accessing them. Secondly, the defendants' submission would prevent the compulsory acquisition of any security which was subject to conditions which had not yet been satisfied. In practical terms, that would require a 90% holder to make multiple acquisitions --- one on each occasion the conditions for exercise of a particular security was triggered. Moreover, a 90% holder can only exercise the compulsory acquisition power within 6 months after the 90% holder becomes the 90% holder. If the defendants' submissions were to be accepted, it would prevent the power being exercised in relation to any security where the conditions could not be satisfied within the statutory time period: s 664AA(b). Each of those outcomes is contrary to the express statutory purpose of Pt 6A.2 of the Act and should be rejected. For those reasons, s 664A(2)(a) was satisfied --- the notes were convertible into shares. I reject that contention. Espasia holds its shares as trustee of the Fund. The fact that Espasia holds the shares as a trustee does not mean that there must at all times be someone else with a beneficial interest in the shares: Commissioner of Taxation v Linter Textiles Australia Ltd (in liq) [2005] HCA 20 ; (2005) 220 CLR 592 at [30] and CPT Custodian Pty Ltd v Commissioner of State Revenue (Vic) [2005] HCA 53 ; (2005) 224 CLR 98 at [25] - [26] . Espasia has a "relevant interest" in those shares: s 608. It is the party with the economic and control interest. The only beneficiaries of the Fund are Mr Dobinson and his wife, and neither of them is presently entitled to any benefit or payment from the Fund (see [5] above). The rights of the members of the Fund to the assets of the Fund are restricted to the right to be paid (or have rolled over or transferred) certain amounts, subject to Espasia's right to make settlement of amounts payable to members by transferring assets of the Fund with the consent of the members: cl 12.6 of the Trust Deed. Unless and until such an in specie transfer occurs, Espasia has the power to sell or otherwise dispose of investments in any property on such terms and conditions: cl 8.3.5 of the Trust Deed. Put another way, until a beneficiary under a superannuation fund becomes entitled to a superannuation benefit, his or her "equitable proprietary interest" in the fund remains "inchoate" and "uncrystallised" so that each is "neither the legal nor the beneficial owner of the amount that stands to the credit of his [or her] account from time to time": Re Coram (1992) 36 FCR 250 at 253-255. See too Caboche v Ramsay (1993) 119 ALR 215 at 230; Benson v Cook [2001] FCA 1684 ; (2001) 114 FCR 542 at 550-551, 561 and 572 and Cook v Benson [2003] HCA 36 ; (2003) 214 CLR 370 at [35] . For those reasons, Espasia has the "full beneficial interest" in the shares it holds. If the position were otherwise, a regulated superannuation fund which must have a trustee (s 19(2) of the Superannuation Industry (Supervision) Act 1993 (Cth)) could not utilise Pt 6A.2 of the Act. I also reject that submission. As noted earlier, one of the preconditions to the exercise of the compulsory acquisition power is the requirement that Espasia hold "full beneficial interests in at least 90% by value of all the securitie s" in the Company. This objection raises directly what "value" in s 664A(2)(c) of the Act means and, in particular, how s 664A(2)(c) works when the "fair market value", "fair value" or "value" of the securities in the Company is "nil" or "nil or nominal value": see [11] and [12] above. It is necessary to interpret the words of the Act consistent with its statutory purpose. A number of matters are worth restating. First, s 664A(2)(c) refers to "value", not fair value or fair market value. Secondly, "value" in relation to an asset is defined in s 9 of the Act to include "amount". "Amount" is defined in s 9 to include "nil amount and zero". Thirdly, Pt 6A.2 "allow[s] an overwhelming interest holder of a company to acquire all the outstanding securities in the company (securities in all classes) in situations where the holder can demonstrate an overwhelming interest in the company": see [19] above. In the present case, Espasia is the "overwhelming interest holder in the Company" by number and value of the securities. The shares in the Company have little or no value: see [11] above. The notes have no value. Only the shares carry voting rights. Espasia holds more than 90% of the shares. Espasia therefore holds "at least 90% by value of all the securities" in the Company. Contrary to the defendants' submissions, there is no basis for concluding that Pt 6A.2 does not apply unless the securities in the Company have a positive present value: see Resource Surveys Pty Ltd v Harmony Gold (Australia) Pty Ltd [2002] FCA 391 ; (2002) 121 FCR 452 at [20] . Such a conclusion is contrary to the express words of the Act and the stated purpose of the Part: see [17]-[21], [23]-[24] and [50] above. The defendants further submitted that based on the offer made by Espasia to acquire the shares and notes, Espasia did not hold "at least 90% by value of all the securities" in the Company. Contrary to the defendants' submission, the amount that is offered as the price on a compulsory acquisition is not necessarily the "value" of the securities in question. The price offered may be more or less than the value of the securities. If it is less, the acquisition will likely be not approved. If it is more, the difference between price and value may be attributable to any number of circumstances. But the difference does not deny the importance of recognising that the question presented by the Act is one about value, not price. Espasia (which holds no notes) holds 94.58% of the shares or $17.35. The defendants submitted that this amount was $0.6 cents less than the 90% threshold. For the reasons set out earlier (see [50] to [51]), I reject the defendants' contention that Espasia has not met the threshold of at least 90% by value. The defendants' calculations are referable not to the value of the securities of the Company as assessed by WHK but Espasia's offer price (cf the comments of Emmett J in Regional Publishers Pty Ltd v Elkington [2006] FCA 1017 ; (2006) 154 FCR 218 at [35] and [55]). WHK's task was to assess whether that offer price was a "fair value" for the securities. WHK's conclusion having regard to the "value" of the securities was that the offer price did reflect a "fair value". In the present case, the price to be paid by Espasia is not the value. "Price", "Cost" and "Value" are different concepts and the definition of "Value" can and does vary depending on circumstances: see eg International Valuation Standards (6 th ed, International Valuation Standards Committee, 2003) "General Valuation Concepts and Principles" section 4.0 and "International Valuation Standards" section 3.0. In the present case, the "price" offered by Espasia should not be used for the purposes of determining whether Espasia has met the threshold in s 664A(2)(c) of the Act. Espasia contends, however, that the matters were addressed in WHK's Supplementary Report of 31 August 2009 (see [16] above) and that the failure to address these matters was able to be regularised by an order under s 1322 or s 1325D of the Act. The defendants submitted that the matters had to be included in the Report and the failure to do so was fatal to the application. Further, the defendants submitted that the omission was not rectified by the Supplementary Report. Two issues arise: was the omission rectified in the Supplementary Report and, if so, was the omission an irregularity capable of resolution under ss 1322(2), 1322(4) or 1325D of the Act? The answer to both is yes. First, the matters prescribed in s 667A(2)(a) and (b) of the Act were directly addressed by WHK in the Supplementary Report (see [16] above) and the reasons did provide a basis for the opinion expressed. Counsel for the defendants may not have liked the form and content of the response, but the matters were addressed. It was for the defendants to assess that response, with the assistance of their advisors and for them to then determine whether to accept Espasia's offer or object as they have chosen to do so. Secondly, the failure to directly address those matters in the Report, in my view, was a procedural irregularity under ss 1322(2) or 1322(4)(a) of the Act which does not invalidate the proceeding. As explained earlier (see [29] above), the omission was not an irregularity which affected a security holder's decision to object. Ultimately, all security holders did object. Moreover, as the defendants' counsel properly conceded, the defendants suffered no injustice or prejudice, let alone substantial injustice or prejudice, by reason of the failure of the Report to address the matters prescribed in s 667A(2)(a) and (b) of the Act: Austrim Nylex Ltd v Kroll (No 2) [2002] VSC 193 ; (2002) 42 ACSR 18 at 39-41 and cases there cited; Elderslie Finance Corp Ltd v Australian Securities Commission (1993) 11 ACSR 157 at 160; Whitehouse v Capital Radio Network Pty Ltd (2004) 13 Tas R 27 ; Cordiant Communications (Australia) Pty Ltd v Communications Group Holdings Pty Ltd [2005] NSWSC 1005 ; (2005) 55 ACSR 185 at [103] ; Capricorn Diamonds Investments Pty Ltd v Catto [2002] VSC 105 ; (2002) 5 VR 61 at [258] - [261] and Markopoulos v Wedlock [2008] WASC 3 ; (2008) 26 ACLC 129 at [56] . What then is the appropriate relief? In the circumstances, it is appropriate the Court grant Espasia a declaration under ss 1322(2) and (4) of the Act that notwithstanding the Report did not satisfy s 667A(2)(a) and (b) of the Act, the Report and the notices of compulsory acquisition given to the defendants under s 664C of the Act and this proceeding are not invalidated. Given the views I have formed about s 1322 of the Act, it is unnecessary to consider s 1325D of the Act. OBJECTION 4: NO STATUTORY POWER OR AUTHORITY FOR THE COURT TO APPROVE THE COMPULSORY ACQUISITION BECAUSE THE ACQUISITION NOTICES DATED 18 MAY 2009 WERE SUBSTANTIVELY DEFECTIVE. The defendants' submission that the notices of compulsory acquisition were defective was dependant on the defendants succeeding in relation to objections 2 and 3. In light of the views earlier expressed dismissing those objections, this ground of objection also fails. As stated by Emmett J in Regional Publishers Pty Ltd v Elkington [2006] FCA 1017 ; (2006) 154 FCR 218 at [58] "it is a matter for the Court, on the basis of the evidence before it ... to determine whether [the terms of the compulsory acquisition of the securities] gives shareholders a fair value. " That task has been undertaken. For those reasons, I will make the following declarations and orders: Declaration under ss 1322(2) and further or alternatively s 1322(4) of the Act that notwithstanding the Report did not satisfy s 667A(2)(a) and (b) of the Act, the Report and the notices of compulsory acquisition given to the defendants under s 664C of the Act and this proceeding are not invalidated. I certify that the preceding sixty-seven (67) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gordon. | shares convertible notes compulsory acquisition of application for approval of compulsory acquisition whether applicant satisfied relevant statutory provisions whether expert's report satisfied relevant statutory provisions whether fair value was given for shares and notes corporations |
The application is made pursuant to s 153B of the Bankruptcy Act 1966 (Cth) ("the Act "). Mr Bulic became bankrupt upon the making of a sequestration order by a Registrar of the Court on 8 May 1995. By operation of s 153(1) of the Act Mr Bulic was discharged from bankruptcy on 8 July 1998. 2 Mr Bulic contends that the sequestration order was wrongly made because he was not indebted to the respondent at the time at which it was made and that, in any event, his assets exceeded any liability which he may have had to the respondent at that time. He seeks to have his bankruptcy annulled because his reputation has suffered and he has suffered significant shame, distress and anxiety. 3 The relevant facts are, largely, not in dispute. In 1990 Mr Bulic owed some $230,000 to the State Bank of Victoria. This sum was made up of principal and interest on loans made to Mr Bulic for business purposes. The loans were secured by a mortgage over a residential property, owned by Mr Bulic, in Balwyn. In 1990 the property was sold and most of the proceeds of the sale were paid to the bank. The mortgage was discharged. Mr Bulic says that he assumed that the money paid to the bank was sufficient to extinguish his debt. The respondent asserts that the debt was not wholly extinguished and Mr Bulic's then solicitor has stated that he had so advised Mr Bulic in early 1991. In 1993 the respondent (which had by then taken over the State Bank of Victoria) commenced proceedings in the County Court of Victoria seeking recovery of $59,638.01 allegedly owed by Mr Bulic. A default judgment was entered on 15 June 1993 and it has never been set aside. On 29 April 1994 Mr Bulic paid the respondent $7,000 pursuant to an agreement made between him and the respondent. He made a further payment of $3,000 on 4 May 1994. On 2 February 1995 the respondent, as judgment creditor, petitioned the Court for a sequestration order against the estate of Mr Bulic. The debt on which the respondent relied was in the sum of $49,638.01. Mr Bulic filed a Notice of Opposition in response to the creditor's petition. That Notice did not assert that Mr Bulic was not indebted to the Respondent. Rather he sought to rely on the claim that the execution of the judgment had been stayed by the agreement. On 8 May 1995 a sequestration order was made by a Registrar. Mr Bulic did not attend before the Registrar and he was not represented. No application was subsequently brought for review of the Registrar's decision. No application was made by Mr Bulic to annul the bankruptcy during its currency. 4 It is necessary to examine, in some greater detail, certain events which occurred between the entry of the default judgment in the County Court in 1993 and the making of the sequestration order in May 1995. Upon becoming aware of the default judgment Mr Bulic sought legal advice. He then entered into negotiations with the respondent. The outcome was the agreement that he pay the respondent the full amount of the judgment debt over a period of four years. The respondent, for its part, agreed not to charge interest on the outstanding sum during this period. The two payments, made in April and May 1994, were paid pursuant to this agreement. When no further payments were made the creditor's petition was filed. When responding to the creditor's petition Mr Bulic did not dispute his alleged indebtedness to the respondent. On the contrary, he admitted it. THAT I have given one Robert Molesworth H Cole a registered Trustee an authority under section 180 of the Bankruptcy Act to call a meeting of creditors. I am informed by him and verily believe that the said authority will be filed in the proper offices of the Registrar in Bankruptcy during the course of today 3 April 1995. THAT I have in all creditors of approximately $250,000 - $300,000 including the debt to the Petitioning Creditor. He attributed the suggested error in his affidavit to language difficulties. His explanation is not persuasive. Had he been intending to alert the Court to the fact that he had assets which well exceeded the amount of his indebtedness to the respondent it is unlikely that he would have said that the debt to the respondent formed part of the $250,000-$300,000 which he now claims to be monies owing to him at the time. It is also unlikely that he would have caused a meeting of his creditors (which included the respondent) to be called. 5 While the bankruptcy proceeding was pending in this Court the applicant was advised by his then solicitor that he could not succeed in defending the proceeding because he could not prove that he didn't owe the money claimed by the respondent. He took advice from his solicitor as to whether or not he should enter into an arrangement under Part X of the Act . Having considered the matter he decided not to do so. 6 After the sequestration order was made a statement of affairs, signed by Mr Bulic, acknowledged his debt to the respondent. 7 In April 1999, following his discharge from bankruptcy, Mr Bulic applied to the County Court for an order setting aside the 1993 default judgment. The application was dismissed on 22 June 1999 because Mr Bulic's trustee in bankruptcy refused permission for him to prosecute the application. 8 Over the past decade Mr Bulic has made strenuous efforts to obtain bank records which, he claims, would demonstrate that he was not indebted to the respondent (or its predecessor) once the proceeds from the sale of his property were paid to the bank early in 1991. These efforts have included extensive correspondence with the respondent, a complaint to the Banking Ombudsman, an application to the Privacy Commissioner and the bringing of a proceeding in the Supreme Court of Victoria which appears to have been commenced in order that the respondent would be required to discover such records. All these attempts have failed. Mr Bulic has never been provided with a reconciliation and supporting documentation. The respondent claims that, in 1991, Mr Bulic was advised that the relevant statements were available for him to collect at his local bank branch but that he did not avail himself of the offer. Mr Bulic disputes that the offer was made or received by him. There is an ongoing dispute as to what, if any, records continue to be held by the bank. 9 Mr Bulic's application was served on his trustee and on the Respondent. He asserted that, apart from the Respondent, he had no creditors. Despite being served, the trustee did not prepare a report in accordance with the requirements of Rule 7.04(1) of the Federal Court (Bankruptcy) Rules 2005 . Neither party sought to make complaint about this failure or to suggest that he or it was prejudiced as a result. The trustee did not appear at the hearing. 10 Although some details of Mr Bulic's financial position were provided by him, those details were far from comprehensive. They did not enable a judgment to be formed as to whether or not he is presently solvent. My attention was drawn to certain documents which established that Mr Bulic entered into an agreement --- a deed of assignment - with his trustee when he was seeking to pursue certain persons whom he claimed owed him money for work and labour which he had supplied at a sporting venue. It was a condition of that arrangement that a percentage of any judgment sum which was secured as a result of the then proposed proceeding would be paid to his trustee. On 20 July 1998 Mr Bulic obtained a Court order in his favour for $91,200. He was, pursuant to the agreement, required to pay the agreed sum to his trustee. He has not done so. The amount owed to his trustee was said to be $34,357.04. At the hearing he said that he had advised his trustee that he would not pay this debt until the trustee had secured a proof of debt in relation to the sum allegedly owed by him to the respondent. 11 During the course of the hearing it was noted that Mr Bulic had not proffered any undertakings that he would pay the costs of the Respondent or the trustee's costs of administration in the event that he was successful in obtaining an order that his bankruptcy be annulled. Such undertakings were proffered, on instructions, by his counsel during the course of the hearing. These authorities establish a number of relevant propositions. (2) An applicant who seeks an annulment of his or her bankruptcy "carries a heavy burden". It is incumbent on an applicant "to place before the Court all relevant material with respect to his or her financial affairs so that the Court may be properly informed and may make a judgment that is based on the actual circumstances of the applicant": Re Papps; Ex parte Tapp (1997) 78 FCR 524 at 531. (3) In determining whether or not a sequestration order "ought not to have been made" the Court is not confined to a consideration of whether the order should have been made on the facts known to the Court at the time at which it was made. The Court must take account of facts, known at the time at which the sequestration order was made and at which it determines an annulment application, even if those facts were not before the Court at the time at which the sequestration order was made: Boles v Official Trustee in Bankruptcy (2001) 183 ALR 239 at 243; Re Raymond; ex parte Raymond (1992) 36 FCR 424 at 426. (4) A sequestration order "ought not to have been made" if, on the facts known at the time of the annulment application, the Court would have been bound not to make the sequestration order: Re Frank; ex parte Piliszky (1987) 16 FCR 396. (5) The Court will be so satisfied if it is established that the debtor was not, at the time the sequestration order was made, indebted to the petitioning creditor: Re Deriu (1970) 16 FLR 420 at 422. (6) If the Court is so satisfied, it is not precluded from annulling the bankruptcy because the bankrupt had not sought to have the default judgment set aside or failed to oppose the creditor's petition or failed to seek a review of the sequestration order: Re Raymond; ex parte Raymond (1992) 36 FCR 424 at 426. (7) The power conferred on the Court by s 153B(1) is discretionary in nature. Even if persuaded that the sequestration order ought not to have been made, the Court can, in appropriate circumstances, decline to annul the bankruptcy: Boles v Official Trustee in Bankruptcy (2001) 183 ALR 239 at 243. (8) Considerations which may have a bearing on the exercise of discretion include unexplained delay in the making of the application, whether or not the applicant is solvent, whether or not the applicant has made full disclosure of his or her financial affairs and a failure by the bankrupt to oppose the creditor's petition and attend the hearing at which the sequestration order was made: Re Williams (1968) 13 FLR 10 at 24-5; Boles at 247; Re Papps; ex parte Tapp (1997) 78 FCR 524 at 531; Rigg v Baker [2006] FCAFC 179 at [79] ; Cottrell v Wilcox [2002] FCA 1115 at [7] . Additional considerations are collected in D. A. Hassall, "Annulment of Bankruptcy and Review of Sequestration Orders" (1993) 67 ALJ 761 at 766. 13 Mr Bulic's application to the Court did not set out the grounds on which the annulment was sought. In his written submissions counsel for Mr Bulic contended that "the sequestration order ought not to have been made because the original debt relied upon by the Respondent to secure that the bankruptcy never existed, the County Court was mislead (sic) by the Respondent in obtaining the default judgment, and so there was no basis to obtain the sequestration order. " Mr Bulic accepted that he carried the burden of establishing that, for these reasons, the sequestration order ought not to have been made. In seeking to make good these claims he laboured under the difficulty of not having access to relevant bank records and any reconciliation calculated by the respondent. He relied on advice which had been given to him in a letter from the bank in November 1990 which said that his debt was about $208,000. He knew that about $217,000 from the sale price of his property had been paid to the bank. He calculated, by reference to the then current interest rates, that interest on the $208,000 could not have exceeded $9,000 in the period between November 1990 and the end of January 1991 when the proceeds of the sale were paid to the bank. It was submitted that these calculations strongly suggested that "the debt to [the bank] was cleared in January 1991. " He noted that no proof of debt has ever been obtained from the Respondent and that the default judgment in the County Court was obtained solely on the basis of a sworn assertion by a bank officer that the debt was owed. 14 Put simply, Mr Bulic contends that the sequestration order ought not to have been made because he was not, in May 1995, indebted to the Respondent. 15 Whilst I entertain some sympathy for the evidentiary difficulties which confront Mr Bulic, and can understand the reason that he has been forced to develop his contentions in the way that he has, I am not persuaded, on the evidence, that the debt was not owed. At the time at which the default judgment was entered in 1993 and, in the early part of 1995 when the creditor's petition was before this Court, Mr Bulic received legal advice from solicitors who were acting for him. At those times he acknowledged his indebtedness to the Respondent. He did so by entering into the arrangement with the Respondent under which it was agreed that he would pay the money owing over a four year period. Such an acknowledgement is also implicit in his making of two payments totalling $10,000 to the Respondent in 1994. The debt is acknowledged in the affidavit which he swore in the proceeding commenced by the filing of the creditor's petition. He did not file a defence in the County Court action which led to the entry of the default judgment. In particular, he did not, at that time, seek to call into question the veracity of the bank officer's deposition on which the default judgment was obtained. As recently as 25 March 2002 Mr Bulic wrote to the Respondent's solicitor referring to his belief that "if I could pay the CBA the money I owed I would feel better inside by 'clearing my name'. 17 Even had I been persuaded that the debt had not been owed I would still not have been disposed to annul Mr Bulic's bankruptcy. I am not satisfied, on the material before me, that he has been solvent, at least since early 1993. He is presently indebted to his trustee for a significant sum and he has provided no evidence of his capacity to pay that debt. His failure to attend the hearing before the Registrar in order to oppose the making of the sequestration order is also relevant as is the 11 year delay in seeking to have the sequestration order annulled. 18 The respondent filed a motion to strike-out the proceeding on the basis that it was an abuse of process. I agreed to hear the strike-out application and argument on the merits of the annulment application together in order to avoid unnecessary costs to the parties and ensure efficient use of Court time. Having regard to my determination that the annulment application should be refused it is unnecessary that I deal with the strike-out application. 19 After the foregoing reasons had been written but before judgment had been delivered Mr Bulic applied to the Court to reopen his case. He did so in the following circumstances. Prior to the original hearing his solicitor had served a notice to produce on the respondent covering, effectively, all documents in the possession of the respondent which touched on his indebtedness. When the notice to produce was called on at trial counsel for the respondent advised the Court that the respondent could not add to the state of the evidence. In fact there was, in the possession of the respondent, four folders containing some 753 pages, most, if not all of which, were comprehended by the notice to produce. There is a dispute between the parties as to why the documents were not produced at or before trial. I accept that there was no intention on the part of the respondent deliberately to withhold the material. Rather, it appears that the files were held in a different part of the respondent's large organisation than the one which was giving instructions in relation to the proceeding. Greater diligence could and should have ensured that the documents were produced to Mr Bulic at or before the initial hearing. That said, the respondent, upon becoming aware of the existence of the files had them copied and supplied them to Mr Bulic on 9 March 2007. Upon receipt of the files Mr Bulic made application to reopen his case. 20 The parties made detailed written submissions in support of and in opposition to the reopening of the case. When the application was called on for hearing both counsel (subject to one exception) advised the Court that their submissions contained all that they desired to submit as to the potential use of the material (should it be admitted in evidence) in supplementing the cases they had already argued. The exception was taken by counsel for Mr Bulic. He indicated that his client may wish to have certain balance inquiry dockets submitted to an accountant for an expert opinion which might then be tendered in evidence. 21 There is no doubt that the Court has a discretion, in the interests of justice, to order that Mr Bulic's case should be reopened so that he can adduce further evidence and advance further argument: see Inspector General in Bankruptcy v Bradshaw [2006] FCA 22 at [24] . The availability of "fresh evidence" will, in some circumstances, warrant the reopening of a case. 22 Mr Bulic submits that the documents would establish a number of negative propositions. • The files appear to have been "culled" and are incomplete. The balance inquiries which, it is said, should be examined by an expert accountant are numerous. They are printouts of computer records on various dates between 1990 and 1992. They relate to each of the four accounts held by Mr Bulic with the respondent and its predecessor. Each records debit and credit entries over a particular period. They appear to have been printed at the instigation of bank officers and used as the basis for the calculation of Mr Bulic's indebtedness from time to time. 23 The respondent accepts that the Court has a discretion to reopen the case but submits that there is nothing in the newly produced material which would warrant such a step being taken. This is because there is nothing in that material which could reasonably be regarded as advancing the case already put by Mr Bulic. It contends that, on the contrary, there is certain documentary material which confirms Mr Bulic's indebtedness to it, in the amounts alleged, at relevant times. 24 I have examined each of the documents which are relied on by the parties. I have come to the view that there is nothing in any of them which would support Mr Bulic's application for the annulment of his bankruptcy. Indeed, as the respondent submits, there is a good deal of material which tends to confirm Mr Bulic's indebtedness. In particular, there is a letter to the respondent's predecessor from the solicitor acting on Mr Bulic's behalf in relation to the sale of Mr Bulic's residential property. We confirm that our clients are not presently in a position to pay the balance outstanding in their account but have agreed to transfer the balance payable at settlement to reduce this amount. There is nothing in the material to which my attention was directed which would support an argument that Mr Bulic was not indebted to the respondent at the time at which the sequestration order was made. 25 It is true, as Mr Bulic contends, that the files appear to be incomplete. The respondent acknowledges that this is the case, explaining that documents are normally destroyed after seven years. Even if I were disposed to accept Mr Bulic's assertion (which I am not) that adverse inferences should be drawn against the respondent by reason of the incompleteness of the records this would not establish that he was not indebted to the respondent at the time at which the sequestration order was made. 26 Mr Bulic has had over three months to submit the balance inquiry printouts to an accountant for an opinion. He has not done so. In any event, having examined them, I do not consider that they would advance, in any way, the case put by him at the original hearing. 27 In the circumstances, it is not appropriate to accede to the application by Mr Bulic to reopen his case. I would refuse the application. 28 The respondent sought indemnity costs in respect to the original hearing and makes the same application in respect of the application by Mr Bulic to reopen his case. 29 The Court has an absolute and unfettered discretion to award costs but that discretion must be exercised judicially: see Trade Practices Commission v Nicholas Enterprises Pty Ltd (1979) 42 FLR 213 at 219. Any departure from the ordinary rule that costs should be paid on a party-party basis requires the presence of something special or unusual in the conduct of the case to be demonstrated: see Preston v Preston [1981] 3 WLR 619 at 637. The types of case in which it may be appropriate to award indemnity costs do not fall in any closed categories: see Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (unreported, French J, 3 May 1991). One type of case in which it has been held that indemnity costs might be ordered is that in which an applicant pursues a hopeless case. In such cases the action must be presumed to have been commenced or continued for some ulterior motive, or because of some wilful disregard of the known facts or the clearly established law. Such cases are, fortunately, rare. But when they occur, the Court will need to consider how it should exercise its unfettered discretion. 30 There is force in the respondent's submissions that both the principal application and the application to reopen were bound to fail. I am not, however, persuaded that any ulterior purpose motivated Mr Bulic in bringing either application. He was, and remains, frustrated by the inability of the respondent to provide him with a detailed documentary foundation for the claims which led to his bankruptcy. He is anxious to clear his name of the perceived stain of bankruptcy. He has sought and obtained legal advice which I must assume was to the effect that he had an arguable case. The application to reopen occurred as a result of the respondent failing to respond (as it should have done) to Mr Bulic's notice to produce. Again, Mr Bulic had legal advice that I must assume was that he could mount an arguable case in favour of the application for leave to reopen. He was, at all hearings, represented by experienced counsel who advanced plausible arguments on his behalf. 31 In the circumstances I consider that the normal order for costs should be made in respect to both the principal application and the application for leave to reopen. | application for annulment of bankruptcy where sequestration order made against the estate of applicant whether sequestration order "ought not have been made" whether at time sequestration order made applicant was indebted to the respondent discretion to make annulment order application to reopen proceeding whether availability of fresh evidence warrants reopening nothing in discovered documents that supports application for annulment of bankruptcy application to reopen proceeding refused bankruptcy practice and procedure |
2 The first is that conduct of the applicant's case was unusually expensive because of onerous security restrictions imposed at the instance of the first respondent. Leaving aside enlargement of costs on this account solely due to interstate engagement of legal representatives, the premise of this submission must be conceded: the costs are higher than if security considerations and modified procedures had not been present. However, the conclusion argued for does not, in my opinion, follow. The necessity for the security measures was inherent in the preparation of the applicant's case and the measures were either imposed after argument or properly conceded to forestall argument. The measures must be regarded as properly instigated. Both sides' costs were enlarged on that account. I see no reason to deprive the successful party of his costs. 3 The second reason is that the case was likely to clarify and, subject to the appeal now launched, has clarified the law. In my view, the legal conclusion that I reached that the Australian Security Intelligence Organisation Act 1979 (Cth) had not excluded the necessity for procedural fairness for a non-citizen (as that term was used in my principal judgment) is likely to be of some general significance. Until the inspection by the applicant's legal advisers of the first respondent's confidential reasons for decision, that conclusion might reasonably have been hoped to determine the case in favour of the applicant. It would, in my view, be reasonable that, to that point, each party should pay its own costs: there was an element of public benefit in the clarification of the law, including an element of benefit (as to certainty) thereby to the respondents. 4 Otherwise, the usual rule as to costs should apply. The parties' solicitors ought be able to agree on the proportion of the respondents' costs that, in light of that conclusion of principle, the applicant should pay. In such case, I will make orders accordingly. Failing such agreement, the parties should within 14 days each let me have their half-page submissions on the matter. I certify that the preceding four (4) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick. | costs departing from the general rule whether additional costs for unsuccessful applicant to comply with onerous national security restrictions at instigation of respondent warrant departure whether public benefit in clarification of law warrants departure procedure |
The Tribunal had affirmed the decision of a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs to refuse to grant a protection visa to the appellant, which decision was made on 3 May 2001. 2 The appellant is a citizen of Bangladesh. Before the Tribunal the appellant claimed to fear persecution upon the basis that he was an active member and office holder of the Freedom Party, and was blamed for the murder of an Awami League leader. He further claimed that because of his political activities he was attacked by political opponents who tried to kill him and left him with severe injuries. 3 The Tribunal found that the appellant was not a credible witness and that his evidence was vague, generalised and inconsistent, and further that documentary evidence provided by the appellant was not genuine. The Tribunal also found that the Freedom Party was largely inactive, and further that if the appellant resumed his membership of that party on his return, it would be 'most unlikely' that he would face any risk of persecution. 4 Before the Federal Magistrates Court, the appellant claimed that the Tribunal acted in bad faith and/or was biased, had failed to investigate the appellant's claims, had denied the appellant natural justice and had made factual findings that were wrong. The appellant also claimed that the Tribunal's comments (in its decision) were not based upon reasoning which had a rational or logical foundation. 5 The Federal Magistrate found the appellant's claims could not be sustained because there was no evidence of bad faith or actual bias on the part of the Tribunal nor was there anything on the face of the decision which gave rise to an apprehension of bias. His Honour further found that no error had been demonstrated, nor had arisen from the procedures adopted by the Tribunal or by any action it took in its decision-making process. His Honour pointed out that merits review of the factual findings of Tribunal formed no part of the function of the Court in dealing with an application for judicial review and that there was no positive duty imposed upon the Tribunal to investigate an applicant's claim. The Federal Magistrate further found in any event that there was nothing on the face of the Tribunal's decision to suggest an illogicality nor lack of foundation to its findings, and that there was nothing to enliven an obligation on the part of the Tribunal to give particulars pursuant to s 424A(1) of the Migration Act 1958 (Cth) ("the Act ") having regard to the principles established in SAAP v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24. 6 The notice of appeal filed by the appellant on 30 December 2005 claimed in summary that the Federal Magistrate failed to determine whether there was jurisdictional error in the decision of the Tribunal, and had erred in determining that the Tribunal had not breached s 424A of the Act . The appellant also stated on the notice of appeal that " I will provide more details later" . 7 During the hearing for this matter on 24 May 2005, counsel for the appellant requested that I stand down for a time during the day so that he could spend time in discussion with his client. Later on that day, counsel for the appellant informed the Court that he had given certain advice to the appellant which the appellant had declined to accept, and that therefore he was obliged to terminate his retainer. I thereupon stood over the proceedings for seven days. 8 When the hearing recommenced on 31 May 2006 the appellant represented himself with the assistance of an interpreter. His submission comprised simply the assertion in effect that the Tribunal's decision was erroneous, and that the matter should be returned to the Tribunal for a fresh hearing. 9 In the circumstances I made the inevitable orders that the appeal be dismissed with costs. I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. | no special circumstances migration |
The Tribunal had earlier affirmed the decision of a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs (as the Minister was then designated) made on 25 August 2004 to refuse the grant of protection visas to the appellants. 2 Both the appellant husband and wife are citizens of Sri Lanka. The appellant husband had previously journeyed overseas from Sri Lanka and back on at least several occasions. The appellant husband was engaged as a 'media secretary', having previously been a drama producer in Sri Lanka. He had enjoyed an association with the leadership of the United National Party ('UNP') in Sri Lanka, being an association which had largely formed the political context to the present claims to refugee status of the appellants. The second appellant is the wife of the first appellant's second marriage which took place in 1988, and both of the appellants are of Sinhalese ethnicity. They arrived in Australia from Colombo on 30 June 2004 on the authority of a one-month temporary business visa. They made application for protection visas on 29 July 2004, which, as foreshadowed, was refused by the Minister on 25 August 2004. He presented a scenario of political violence which permeated his involvement with the UNP. He testified as to an unprovoked violent incident in 1997 allegedly having political implications, which led to his admission to the Colombo General Hospital. Though he did not seek to present himself as having a status of political leadership, the detail of his evidentiary material disclosed nevertheless an experience of significant involvement in a political context which tended to reflect a measure of authenticity in its descriptions of the events with which he had been actively associated or connected. 4 The appellant husband's central claim in the context of the Tribunal proceedings related to the April 1999 election during which he videotaped a gang (who he identified as comprising government politicians from the Peoples Alliance) committing assaults upon people from the opposing Janatha Vimukthi Perumana ('JVP'). The appellant husband claimed that during the course of videotaping the incident the gang snatched his camera and then assaulted him. He complained to the police, the camera was found and the gang members were placed on trial. However, the exhibits and evidence apparently vanished on the day of the trial. The appellant husband further testified that subsequently on 25 March 2004, he was assaulted in Sri Lanka by an unidentified gang whilst on his way to visit a friend. 5 The appellant husband also testified that on his return from a political study tour of the United States he received 'serious death threats', which were conveyed by way of his mobile phone. He further claimed that he had 'no active protection in Sri Lanka'. He spoke also of death threats to the daughter of the appellant wife, that stepdaughter being engaged in the production of Ceylon television. He spoke also of information from his father as to threats from an unidentified armed gang looking purportedly for the appellant husband after his departure to Australia. 6 In the Tribunal's reasons for judgment, the Tribunal member observed that the appellant had described himself in his statutory declaration as 'a strong politician' and that when the Tribunal asked the appellant husband about his political involvement with the UNP he acknowledged that he had never been elected to political office, albeit that he stood unsuccessfully as a candidate for the UNP for the municipal council elections. However, the appellant husband maintained that he had been involved politically for 24 years and that he had been a political organiser for the UNP. The Tribunal found that the applicant's "claimed fear of persecution arising from his political opinions [does not have] any foundation". The Tribunal fell into jurisdictional error in making this finding. The Tribunal found that "at the time of his departure from Sri Lanka in June 2004...the applicant did not hold a genuine fear of persecution in Sri Lanka because of his political opinions". If this was meant to be a finding that the applicant did not have a genuine fear of persecution, the Tribunal fell into jurisdictional error in making this finding. It was emphasised that the appellant husband had raised that issue with the Tribunal, and that the Tribunal's failure to address that issue, to the comprehensive extent reasonably required, constituted a jurisdictional error. Counsel for the appellants further submitted that the Tribunal also failed to make findings regarding the appellant husband's claim that his stepdaughter (being the daughter of his present wife) had received threats from unknown people due to his political opinion and connections and had instead wrongly held that his claims regarding those threats were ' unsupported and, significantly, in vague terms '. Lloyd-Jones FM observed that the Tribunal was not satisfied that the threats to the appellant husband were made for political reasons, and that it was open to the Tribunal to adopt that finding in relation to the alleged threats communicated to his stepdaughter. 10 Counsel for the appellants further submitted that jurisdictional error arose due to the Tribunal's narrow interpretation of the judicial test as to persecution in a refugee context, in that it should have considered the nature of the political opinion of his alleged persecutors. Lloyd-Jones FM found, however, that there was a lack of sufficient evidence placed before the Tribunal to enable a finding to be made on the motivation of the gang members who had assaulted him. 11 Additionally, counsel for the appellants submitted that the Tribunal erred in relation to its assessment of the appellant husband's subjective fear. It was said in that context that the Tribunal failed to consider the significance additionally of threats made to the appellant husband's father (and apparently also to his stepdaughter) after the appellant had left Sri Lanka and was present in Australia, and that the Tribunal misconstrued the test of persecution by considering the nature of the alleged fear only as at the time the appellants left their country of nationality, rather than any continuing well-founded fear extant at the time of the Tribunal proceedings. 12 Lloyd-Jones FM accepted the essence of the Minister's submissions advanced regarding the lack of viability of the appellants' claims as putative refugees. The Minister submitted that the Tribunal correctly determined their application adversely to them as at the date of the determination. In purportedly applying Minister for Immigration and Ethnic Affairs v Singh (1997) 72 FCR 288 at 294 (Black CJ, Lee, von Doussa, Sundberg and Mansfield JJ), the Tribunal was evidently of the view that the appellant husband's circumstances the subject of his claims had not changed sufficiently since leaving Sir Lanka, and that the claimed threats were no more than further instances of circumstances which the Tribunal considered to have been evident at the time of the appellant husband's departure for Australia. 13 In relation to the case that the Tribunal's obligation to consider the appellant husband's claim was not limited to what he put forward in his application, counsel for the appellants referred his Honour to NABE v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 263 ; (2004) 144 FCR 1 (Black CJ, French and Selway JJ) at [55]-[63]. However, Lloyd-Jones FM distinguished NABE [2004] FCAFC 263 ; 144 FCR 1, observing that ' the present case does not fall into that category... [f] or this argument to succeed, the Tribunal would have to be satisfied that the actions of the "gang" was [sic] motivated by political opinion and were not criminally based '. In his Honour's view the Tribunal did not find that the unidentified gang members involved in the assault had ' political motivation nor that their activities were not entirely criminal in nature '. His Honour was satisfied that the Tribunal dealt with the material correctly. 14 On the basis of those findings which I have sought to summarise, the Federal Magistrate dismissed the appellants' application for curial review of the Tribunal's decision. I have difficulty with the proposition that the appellant husband's fear of persecution could not have arisen in the evidentiary context he postulated, notwithstanding the confinement of his political exposure to that of a media advisor to a politician, but seemingly that measure of concern on my part is not strictly necessary or essential to my decision-making. During the hearing of the appeal to this Court on 9 November 2006, the appellants sought to rely on an amended notice of appeal. His Honour committed an error of law in dismissing the appeal from a decision of the Second Respondent in circumstances where the Second Respondent failed to comply with section 430(1)(c) of the Migration Act 1958 , thereby committing jurisdictional error by not having regard to probative material. His Honour further erred in upholding the Second Respondent's decision in circumstances where the Second Respondent constructively failed to exercise jurisdiction and act judicially when making a critical finding as to the nature of persecution faced by the Appellant. His Honour further erred in upholding the Second Respondent's decision in circumstances where the Second Respondent failed to consider an integer of the appellants' claim. The Applicant said that he was seen on television on 1 May 2004, and from that moment he received "real threats". The Minister therefore requested that leave to amend be subject to an order that the appellants pay the Minister's costs thrown away. Counsel for the Minister further submitted that s 430 of the Migration Act 1958 (Cth) ('the Act') was now being relied upon in substitution for the s 424A ground contained in the original notice of appeal, and 'that being so, all I'm asking for...is that having put in their submission late we did the reasonable thing to make our submission to be prepared on time; they changed the case and we should get costs thrown away'. That submission is correct in principle, but whether or not any significant amount of legal costs were in effect 'thrown away' may well be in reality debateable, and would be a matter for the Court's assessment officer who undertakes the taxation process. In the somewhat complex circumstances of this case, the submission would not be a necessary 'given'. 17 Counsel for the Minister emphasised further complaint in particular in relation to the third ground the subject of the amended notice of appeal, which the Minister contended to be a new ground, and submitted that leave should be refused as it 'was not run below' and was a 'weak ground'. However both parties addressed the Court on the merits or lack of merit thereof. In any event the view I have reached is not anchored to that third ground. 18 In relation to the first ground of appeal, the appellants submitted that the Tribunal did not pay 'realistic regard' to the relevant newspaper article, 'in that [the Tribunal failed to] give reasons why it did not find material contained in that article to be of probative value to the appellant's claim'. But that is an inference not too readily to be drawn where the reasons are otherwise comprehensive and the issue has at least been identified at some point. It may be that it is unnecessary to make a finding on a particular matter because it is subsumed in findings of greater generality or because there is a factual premise upon which a contention rests which has been rejected. Where, however, there is an issue raised by the evidence advanced on behalf of an applicant and contentions made by the applicant and that issue, if resolved one way, would be dispositive of the tribunal's review of the delegate's decision, a failure to deal with it in the published reasons may raise a strong inference that it has been overlooked. 21 Counsel for the Minister drew attention to Iyer v Minister for Immigration and Multicultural Affairs [2000] FCA 52 at [36] (O'Connor J), Addo v Minister for Immigration and Multicultural Affairs [1999] FCA 940 at [24] (Spender, O'Connor and Emmett JJ), and Re Minister for Immigration and Multicultural Affairs; ex parte Durairajasingham [2000] HCA 1 ; (2000) 168 ALR 407 at [64] - [66] (McHugh J sitting as a single justice of the High Court), in support of the contention that s 430 of the Act does not impose any duty to deal with adverse material. Counsel submitted in that regard that '[t]he significance of these authorities is that it is not open to a court to infer from the fact that evidence adverse to the findings made by a Tribunal has not been mentioned that it has not been properly considered'. However, the contrary view was taken by differently constituted Full Courts in Ahmed v Minister for Immigration and Multicultural Affairs , Addo v Minister for Immigration and Multicultural Affairs and Sivaram v Minister for Immigration and Multicultural Affairs. Section 430 does not require a decision-maker to give reasons for rejecting evidence inconsistent with the findings made. Accordingly, there was no failure to comply with s 430(1) of the Act. However, the obligation to set out "the reasons for the decision" (s 430(1)(b)) will often require the tribunal to state whether it has rejected or failed to accept evidence going to a material issue in the proceedings. Whenever rejection of evidence is one of the reasons for the decision, the tribunal must set that out as one of its reasons. But that said, it is not necessary for the tribunal to give a line-by-line refutation of the evidence for the claimant either generally or in those respects where there is evidence that is contrary to findings of material fact made by the tribunal... . That was sufficient to comply with the requirements of s 430(1). His Honour's observations do not provide sufficient support for the Minister's submission. As I would read the thrust of the foregoing dictum of McHugh J in Durairajasingham , his Honour's emphasis appears to be on the need for the Tribunal to make clear the nature and extent of its reasons for rejection of evidence placed before it going to material issues in the proceedings, which, if accepted, would be susceptible to producing an ultimate outcome different to that which was reached. Nevertheless, given the potential importance of the letter and the delegate's fleeting, uncritical references to it in his reasons, in my view the inference should be drawn that the delegate did not actually consider what significance and weight it deserved. A decision-maker cannot be said to "have regard" to all of the information to hand, when he or she is under a statutory obligation to do so, without at least really and genuinely giving it consideration. As Sackville J noticed in Singh v Minister for Immigration and Multicultural Affairs [2001] FCA 389 ; (2001) 109 FCR 152 at [58] , a "decision-maker may be aware of information without paying any attention to it or giving it any consideration". In my opinion, it would be very surprising if the delegate had genuinely paid attention to the letter and given it genuine consideration --- had in Black CJ's phrase in Tickner v Chapman (1995) 57 FCR 451 at 462 engaged in "an active intellectual process" in relation to the letter --- yet remained silent about such consideration in the reasons he gave. I am satisfied he did not do so. It was further submitted that the Tribunal erred by not considering the particular social group to which the appellant husband belonged in order to be able to properly assess the nature and extent of the appellant husband's subjective fear of persecution. That particular social group was said on behalf of the appellants to include 'a person who is professionally and visibly associated with a prominent politician who had changed parties'. 25 In relation to the appellant's reliance on NAJT [2005] FCAFC 134 ; 147 FCR 51, counsel for the Minister submitted that unlike the circumstances of the present proceedings, the Court in NAJT was there addressing a situation where the Tribunal 'was asserting in effect that [the applicant had] given nothing in support of [his] claim when in fact he had put something in support of his claim...[and] not surprisingly it was open to the Court to say...where there is a [matter] directly relevant to a critical issue of your claim, then the failure to deal with it was a jurisdictional error'. 26 For reasons apparent from what I have already pointed out or else determined, I have reached the view, after giving the issues arising at the instance of the appellants and the Minister much thought, that there is sufficient basis for the operation here of those principles adversely to the Minister's case, in the sense of failure to deal with a matter of relevance sufficiently or adequately in the particular circumstances of this case. The appellants' case the subject of par 1(c) of the appellants' amended notice of appeal above, does not appear to have been sufficiently addressed in the presentation of the Minister's case, at least largely for the reasons the subject of par 1(d) above. 27 The Minister's submissions upon the first and second grounds raised in the appellants' amended notice of appeal seem to me to have been somewhat too clinical in approach, and to fall short of coming adequately to issue with the nature and contextual significance of the events purportedly addressed by the Minister in that regard, being events, viewed in terms of their physical occurrence, the credibility whereof was not to my understanding the subject of dispute. 28 In relation to the third ground of appeal raised in the amended notice of appeal, counsel for the appellants submitted that the Tribunal's finding, to the effect that the threats the appellant husband received were not attributable to political reasons, was made 'in relation to the threats arising from [the] 1999 videotaping incident and not from the fact that, after appearing at the media conference on 1 May 2004... the appellant received "real threats"'. Counsel for the appellants further submitted that 'it was incumbent on the Tribunal to consider whether the appellant had a well-founded fear of persecution by reason of the 1 May 2004 media conference and after which the appellant claimed that is when the "real death threats took place" by reason of the fact that he was perceived as changing parties in concert with...the former Foreign Minister of Sri Lanka'. It was contended that jurisdictional error arose out of the Tribunal's failure to consider whether there was a real chance the appellant would be persecuted by reason of his affiliation and association with the former Foreign Minister. 29 Summarising the significance of the findings of the Tribunal, counsel for the Minister submitted that the Tribunal found the 1999 incident to have been criminally rather than politically motivated. Counsel further submitted that the 'Tribunal asked the appellant husband to elaborate on the threats he had received in 2004 and, in relation to the threat received on 1 May 2004, it transpired that what was said could not be characterised as a threat'; and that the 'Tribunal indicated that even if it accepted that he had received the death threats as he claimed, they referred back to the 1999 incident and did not have a political motive'. I have encountered considerable difficulty as to the viability of that indication on the Tribunal's part, for reasons I have already foreshadowed. 30 Counsel for the Minister proceeded in any event to contend that the appellant husband had asked the 'Tribunal to believe that the threats occurred for reasons of his changing political parties', an emphasis of his case said to have occurred after his original claims were found to be wanting a Convention nexus. However, so the Minister's contention continued, none of the threats supported this allegation and the Tribunal impliedly rejected that claim in observing that the evidence did not support it. The present claim to refugee status bears a somewhat contextual uniqueness. The appellant husband's unfortunate experience of serious physical assaults upon his person the subject of media publicity, which occurred in the temporal context of his public profile, and the implications of the then prevailing political climate to which he was subjected, albeit not as an elected politician, provided a potentially viable basis for his case of causation relevantly to his political profile. Although the wife of the appellant husband had a prominent acting career that may well have been removed from her husband's asserted political profile, a further reality open to be reasonably inferred is that in her capacity as his wife, she may well have conceivably shared his apprehensions as to their physical safety. However, as observed by the Tribunal member, there was no specific Convention claim made by or on behalf of the appellant wife before the Tribunal, and accordingly the fate of her application is dependent on the outcome of the appellant husband's application. 32 It can scarcely be gainsaid that both the Tribunal member and the Federal Magistrate below did give close consideration to the significance or otherwise to be accorded to the facts and circumstances of the case. In my opinion, however, the omission to take into account relevant material corroborating the appellant's claims of politically motivated attacks reflected an extent of confinement in the requisite width of approach required in the light of those facts and circumstances, such as to evince constructive error. Put another way, the Tribunal was not entitled in the circumstances to withhold from closer consideration and evaluation material which may well have given rise to conclusions favourable to the appellant husband's claim. 33 I have therefore reached the conclusion that the appeal should be allowed. Accordingly, the decision of the Tribunal will be quashed and the matter remitted for further consideration by a reconstituted Tribunal. I certify that the preceding thirty-three (33) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. | appeal from a decision of the federal magistrates court application for a protection visa serious personal assault whether tribunal failed to comply with s 430 of the migration act whether tribunal failed to take adequately into account relevant material whether tribunal failed adequately to take into account integer of appellant husband's claims reviewable error established migration |
The Minister erred in exercising his discretion to cancel the visa under s 501(2) of the Act by not properly taking into a relevant consideration, namely the best interests of the children. He concluded that [the applicant's] four children under 18 all live with their mothers and that the removal of that contact would cause some hardship. The Minister did not take into account that [the applicant's] youngest son Joshua lives with him and that [the applicant's] removal would have a much greater effect on Joshua. He concluded that [the applicant's] four children under 18 all live with their mothers and [the applicant] has access to them under a court order. There is no evidence before the Minister to support that conclusion with respect to [the applicant's] children Joshua and Larni. I noted that the new ground was in substantially similar terms to the second of the applicant's previous grounds of application with the modification that the substituted ground of application contained reference to the applicant's daughter Larni whereas previously it did not; I accepted Mr Duncan's submission that new ground of appeal was substantially covered in the applicant's original outline delivered to the Minister and that the Minister had addressed those issues in response to the applicant's outline; and I noted Mr Duncan's submission that notice of the proposed amendment had been given to the respondent in the week prior to the hearing. Accordingly, in my view there was no prejudice to the Minister in this matter, and indeed Ms Wheatley subsequently conceded at the hearing that she could point to no prejudice. 5 The result of this amendment to the application is that the issues for consideration by the Court have substantially narrowed. I understand that he has lived predominantly in Australia during the intervening time. 7 The applicant was given a "Notice of Intention to Consider Cancelling a Visa under Subsection 501(2) Migration Act 1958 " ("Notice") dated 19 September 2006 by the Department of Immigration and Multicultural Affairs ("Department"). The Notice specified s 501(2) and s 501(6)(a) as containing the particular grounds on which his visa was liable to cancellation. The applicant was invited to respond to the Notice and did so, as did his family and friends. Responses were received by the Department between 29 September and 12 October 2006, and included information concerning the applicant's four children under the age of 18, Larni, Nikita, Darryl and Joshua. 8 The Department prepared a paper summarising the relevant details ("the Issues Paper") for consideration by the Minister, which was received in the Minister's office on 16 February 2007. The Minister decided to cancel the applicant's visa on 20 February 2007 and set out his reasons in a document ("Statement of Reasons"). The applicant was notified of the Minister's decision on 18 April 2007. The Federal Court therefore has original jurisdiction in relation to this decision in accordance with s 476A of the Act . However, the jurisdiction of the Court is limited to the same as the jurisdiction of the High Court under para 75(v) of the Constitution (s 476A(2)). Accordingly, in this case the Court can only set aside the Minister's decision for jurisdictional error: Plaintiff S157/2002 v Commonwealth of Australia [2003] HCA 2 ; (2003) 211 CLR 476 at 506-508 and 511 per Gaudron, McHugh, Gummow, Kirby and Hayne JJ; Tuncok v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 172 at [8] . An error of fact which may have been made by the Minister is not reviewable by this Court unless it relates to a jurisdictional fact or is a manifestation of some error of law, substantive or procedural, which constitutes jurisdictional error and thereby vitiates the purported decision: Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30 ; (2001) 206 CLR 323 at 351-352 per McHugh, Gummow and Hayne JJ; NABE v Minister for Immigration and Indigenous Affairs (No 2) [2004] FCAFC 263 at [53] . Failure to do so as a primary consideration would result in the decision of the Minister being affected by jurisdictional error: Minister for Immigration and Multicultural and Indigenous Affairs v Lorenzo [2005] FCAFC 13 at [57] - [58] . 12 Guidance for decision-makers in making decisions to refuse or cancel a visa under s 501(2) is found in the Minister's "Direction under section 499 - Visa Refusal and Cancellation under section 501 of the Migration Act - No 21" ("Direction No 21"). Although not binding on the Minister himself, the Minister indicated at para 5 of the Statement of Reasons that he had followed his usual practice and proceeded in accordance with Direction No 21. It is not in dispute that it is relevant for the Minister to have regard to the contents of Direction No 21 in making his decision. The best interests of any children aged 18 years or more is not a primary consideration but may be considered with other considerations under paragraph 2.17. 2.14 Where there are two or more relevant children, it should not be assumed that the interests of each child will coincide, and it may be that the best interests of one child may indicate the non-citizen parent should not be refused a visa or removed from Australia, but that the best interests of another child may point towards visa refusal or cancellation. 2.15 In general terms, the child's best interest will be served if the child remains with its parents. I also gave primary consideration to the best interests of the children. Mr HOLANI has four children aged under eighteen years, currently residing in Australia with their mothers. I noted Mr HOLANI's claims that he has regular contact with his children and the testimonies from family and friends supporting his claims to be a caring and supportive parent and that he has a court order allowing him access to them at least four days per fortnight. I further noted that Mr HOLANI's son, Darryl Lewis Holani, has autism and that Mr Holani is committed to providing him with care and financial support to attend a special school. 23. On balance, I found that Mr Holani's children would suffer some hardship if Mr HOLANI's visa were cancelled. I accepted that the best interests of the children would be met by having both parents available to them during their upbringing and that the best environment for this would be in Australia. I gave this consideration substantial weight. 19 It is clear that the interests of children may vary from one child to another. This is recognised by Direction No 21. So, as indicated by the Minister in his Statement of Reasons, the interests of an autistic child may be different from those of a child who is not autistic. 20 I note that this was also recognised by the Department in the preparation of the Issues Paper for briefing of the Minister. In the document headed " Section 501 Issues Papers: Quality Assessment Checklist" contained in vol 1 of the Respondent's Bundle of Relevant Documents ("RBRD 1") pp 283-285, it appears that both the case officer in the Department who drafted the Issues Paper and a reviewer (identified as another case officer in the relevant unit) "ticked" as completed a box on the checklist described as "If there are multiple children, they have each been considered separately". However simply because there are indications that the relevant officers in the Department have considered each child separately does not mean that this task has been carried out by the Minister. 21 In his Statement of Reasons, the Minister refers to the children cumulatively, singling out only one child (Darryl Holani). This in itself would not necessarily mean that the Minister has not taken into account the best interests of each of the applicant's children, in particular Larni and Joshua as submitted by the applicant, if the reasons of the Minister indicated that their interests had been taken into account: cf Mason CJ and Deane J in Minister for Immigration and Ethnic Affairs v Teoh [1995] HCA 20 ; (1995) 183 CLR 273 at 292; Burchett J in Vaitaiki v Minister for Immigration and Ethnic Affairs (1998) 150 ALR 608 at 614, Lei Wan v Minister for Immigration and Multicultural Affairs [2001] FCA 568 at [283] . The weight given by the Minister to a relevant factor can not be the subject of judicial review: Taylor v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 208 at [19] . However the issue of whether the Minister actually undertook the task is a matter for this Court. That is not to say that the mere assertion by the decision maker that he has done so will conclude the matter. It may be possible to demonstrate from a consideration of all the reasons leading to the decision, or indeed from the decision itself, that a consideration has not been taken into account in any real sense. Conversely the omission of an express reference to some consideration will not lead inevitably to a conclusion that it was not taken into account. An examination of the reasons for decision and of the decision itself may justify the inference that it was . Ms Wheatley for the Minister submitted that there was no obligation on the Minister to initiate further inquiries as to information concerning the children, and indeed this point was not in contention: cf Djalic v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 151 ; (2004) 139 FCR 292 at 314, Taylor [2005] FCAFC 208 at [19] , Yalniz v Minister for Immigration and Citizenship [2007] FCA 426 at [24] . Our son and he are very close. The bond they enjoy is enormous and I fear the Joshua will not be able to understand or cope with suddenly losing someone who is such a big part of his life. He look (sic) up to his father and loves him so much. Darryl Holani is autistic, attends a special school and needs the ongoing support of his father. Nakita [sic] and Joshua Holani attend a public primary school prior to receiving a private school education ostensibly to be funded by their father should he still reside in Australia. The four younger children show great affection for their father. I think I recall I said in my last letter it would be heartbreaking to separate the children from their father, particularly as their biological mother shows little affection toward them. Clyde's partner Vicky Wallace has been living with him since 2000. She is very good with the young children and it is obvious that they are also very affectionate toward her. The Minister said that he gave that consideration substantial weight. However on the basis of the information provided, the question arises as to the basis on which the Minister could or should have further differentiated. The information provided to the Minister by family members and friends of the applicant indicated that the applicant had a close relationship with all four children, and the Minister acknowledged this. While it is clearly important that any special needs of the children brought to the Minister's attention be considered by the Minister, on the evidence it appeared that there were no factors specific to any of the children other than Darryl Holani which were either brought to the Minister's attention or which provoked comment. 27 The key element of the applicant's submissions was that, because the Minister had appeared to make assumptions with respect to the living arrangements of Larni and Joshua Holani, and the applicant's access to those children without evidence, the Minister had not properly considered the best interests of Larni and Joshua. Mr Duncan for the applicant at the hearing submitted that the Minister assumed without evidence that the interests of all four children coincided, that the children deserve assessment as individuals, and that if the children are assessed together and are assumed to have common interests without information to support that assumption, then the Minister may as well not have considered their interests. I have considered this issue carefully, and take a different view. 28 First, in almost every respect it appears that, contrary the submission of Mr Duncan, factors relevant to the best interests of the four children of the applicant did coincide, in that the material before the Minister indicated that the applicant provided them with financial and emotional support, and that there was a close relationship between him and them. It is for this reason that the Minister concluded that it would be adverse to the best interests of the children for the applicant's visa to be cancelled. 29 Second, while it appears that there was no evidence before the Minister as to the living arrangements of Larni and Joshua, and no evidence as to access arrangements, the highest at which any assumptions of the Minister could be put was that the Minister had erred in fact, and as a general rule the Court has no jurisdiction in relation to such an error. No submissions were made that any errors were jurisdictional errors. In any event, as pointed out by Ms Wheatley, no submissions were made by the applicant through his Counsel, that the living and access arrangements in respect of Larni and Joshua were such that the Minister had clearly erred in reaching his decision. It was readily within the power of the appellant to have done so. Further, this is not a case where the Minister has failed to identify anywhere in his Statement of Reasons what the best interests of the children indicated that he should decide with respect to the applicant's visa (cf Branson, North and Stone JJ in Lei Wan [2001] FCA 568 at [26] - [27] ): the Minister clearly stated that the best interests of the children required that the applicant's visa not be cancelled. The only real information of relevance before the Minister concerning Larni and Joshua other than their ages concerned their close relationship with their father and the support he provided them, and this issue was clearly taken into account. The Statement of Reasons for the Minister also indicated in my view that he had given proper, genuine and realistic consideration to the best interests of the applicant's children. There was no material before the Minister, and indeed there is no material before this Court, from which an inference may be drawn that the Minister failed to take into consideration factors relevant to the best interests of each of the applicant's children. While the Minister may have erred in relation to his assumptions concerning the residential and access arrangements with respect to Larni and Joshua - and I note that no submission has been made that the Minister erred, only that he made the same assumptions with respect to these children as he made with respect to Nikita and Darryl - such error would not in my view go to jurisdiction, and the applicant does not submit otherwise. Further, any error by the Minister in confusing the arrangements with respect to Larni and Joshua, with those relevant to Nikita and Darryl, does not in my view mean that the Minister has failed to properly consider the best interests of Larni and Joshua. It is clear that, while the Minister did accord substantial weight to the best interests of the applicant's children and their need for the applicant to remain in Australia, in the Minister's view this consideration was outweighed by other factors which the Minister is also entitled to take into account in reaching his decision, in particular the serious and repetitive nature of the applicant's criminal offences and the need to protect the Australian community. Such a finding is not for this Court to reconsider in the absence of jurisdictional error. 32 In these circumstances, it follows that the application must be dismissed. The application be dismissed. | cancellation of applicant's visa by the minister whether decision to cancel the applicant's visa affected by jurisdictional error applicant has four children under the age of 18 years whether minister took into account as a primary consideration the best interests of the children whether minister took into account the best interests of all four of the children whether minister gave "proper, genuine and realistic consideration" to the best interests of applicant's children joshua and larni migration |
2 The application also seeks to set aside a second decision of the respondent, which was a review of the first decision, which Mr Phillips claims was made on 6 April 2006, and seeks an order that compensation be paid in accordance with the SRC Act. The applicant also seeks, by way of interlocutory relief, an order that incapacity payments be reinstated and paid retrospectively from 10 April 2006. The application is based upon breaches of the Privacy Act 1988 (Cth). 3 As a preliminary issue, I note that the respondent named in the application, the Department of Veterans' Affairs, is not a legal entity which is capable of being sued. The proper respondent is the Military Rehabilitation and Compensation Commission. By consent, I have granted leave for the respondent in the application to be changed to that entity. 5 The applicant was paid compensation for incapacity pursuant to the provisions of the SRC Act in respect of his injury. However on 13 March 2006 Mr Harry Slegers, a delegate of the respondent, determined that the applicant was no longer entitled to receive incapacity compensation. The applicant was notified of the decision by a letter dated 13 March 2006 which stated that payments would cease on 10 April 2006. The letter also states that the decision to terminate incapacity compensation had taken into account the medical assessment conducted by Dr Silva, consultant orthopaedic surgeon, which concluded that the applicant was not incapacitated for work. 6 The applicant says that on 13 March 2006 he had two telephone conversations with Mr Slegers. In the first conversation, Mr Slegers stated he had not received the report of Dr Silva. In the second conversation, which occurred two hours later, the applicant claims that Mr Slegers stated that Dr Silva's report had been emailed to him. Mr Slegers then advised the applicant that he had made a decision to terminate incapacity compensation payments to the applicant. The applicant says that he requested that Mr Slegers forward by email a copy of Dr Silva's report to him, but was told that Mr Slegers could not do so, as to forward a copy of the medical report by email would constitute a breach of the Privacy Act . 7 The applicant says that on 16 March 2006, having received the letter of 13 March 2006, he again telephoned Mr Slegers. The applicant claims that in that conversation Mr Slegers acknowledged that he had made mistakes and agreed that his decision was wrong. The applicant also says that Mr Slegers indicated that he would seek advice from his supervisor and make arrangements to have his decision reversed. 8 By way of corroboration, the applicant has provided a copy of a facsimile which he sent to Mr Slegers on 17 March 2006. The facsimile demands that the medical report of Dr Silva be rejected and that the decision to terminate payments be revoked. The facsimile refers to the two telephone conversations on 13 March 2006 and to the telephone conversation on 16 March 2006. It does not refer to any admission by Mr Slegers that his decision was wrong and should be reversed. 9 On 28 March 2006, the applicant applied to the respondent for a reconsideration of the decision of Mr Slegers. By letter dated 6 April 2006, Ms Gillian Tate, the Manager of Reconsiderations at the respondent, wrote to the applicant stating that specialist medical opinion would be required to challenge the opinion of Dr Silva and allowing the applicant until 19 May 2006 to provide such information. The letter rejected any assertion that Dr Silva's report was false, misleading, unbalanced or biased in the absence of evidence. The letter referred to the opinions of two other medical professionals who had indicated that the applicant was not incapacitated for work. 10 Payments of compensation ceased on 10 April 2006. The applicant, apparently believing on this basis that a decision upon his reconsideration had been made on 6 April 2006, instituted these proceedings on 24 April 2006. 11 In fact, this appears to have been a misunderstanding on the part of the applicant. The cessation of payments occurred as a result of the original decision made on 13 March 2006. It seems that there is no provision of the SRC Act which requires the respondent to continue paying compensation while the reconsideration of a decision is undertaken. In fact, no decision was made by Ms Tate on the reconsideration until 29 May 2006, when she affirmed Mr Slegers' decision, having received no further medical evidence from the applicant. 12 The respondent relies upon an affidavit of Harry Slegers affirmed on 5 July 2006 which disputes many of the factual allegations made by the applicant, and in particular denies that Mr Slegers ever acknowledged that his decision was incorrect or acknowledged that the manner in which the decision was made was wrong. The applicant disputes some of the factual matters contained in that affidavit. 13 In their oral evidence, Mr Slegers and the applicant agreed upon many of the facts outlined above. In view of the findings below, I do not consider it necessary to determine the entirety of the factual disputes between the parties. I generally accept the outline of facts given by Mr Slegers, who appeared to be a reliable witness. He also had the benefit of contemporaneous notes which supported his oral testimony. 14 However, I would also observe that I consider that the applicant genuinely believes that the evidence he gave to the Court is true. The circumstances surrounding the termination of the applicant's compensation benefits have clearly caused him distress. It appears that relations between the applicant and the respondent have been, on occasion, strained, which has led the applicant to be distrustful of the respondent's motives and perhaps to misunderstand comments made by officers of the respondent. The affidavits and statements provided contain a range of complaints against the respondent. Many of those complaints are not related to a legal claim but are issues which might more properly be raised with an ombudsman. 16 The applicant has predicated his claim for the relief he seeks upon breaches of the Privacy Act . The applicant states that officers of the respondent were in breach of the Privacy Act in making their decisions to terminate his compensation payments, and that accordingly those decisions were invalid. In the information accompanying his application, the applicant has specifically referred to breaches of Information Privacy Principles 2, 7, 8 and 9 ('the Principles') and National Privacy Principles 9 and 10. 18 The applicant makes several further claims about the inaccuracy, irrelevance or misleading nature of Dr Silva's report, which he says also lead to breaches by Mr Slegers of Principles 8 and 9. 19 The applicant has also made allegations with respect to actions taken by the respondent in 2003 which were not part of the decisions presently under review. I will not consider these matters as they cannot properly be taken into account in reviewing the decisions which the applicant has challenged in his application. As the only reference to a breach of Principle 2 occurs in respect of these earlier matters, there is accordingly no need to consider Principle 2. 20 The applicant has also made claims against the respondent based upon breaches of the National Privacy Principles. However, for the reasons set out at [23], the National Privacy Principles do not apply to the respondent and therefore the claims in this respect must fail. Accordingly, the Court will not consider these claims. I am satisfied that the respondent is an ' agency ' for the purposes of the Privacy Act and is therefore required to abide by the Information Privacy Principles. 23 The National Privacy Principles are contained in Schedule 3 to the Privacy Act . By s 16A(2) , the National Privacy Principles are binding upon ' an organisation '. The definition of ' organisation ', contained in s 6C , explicitly excludes an agency. Accordingly, the National Privacy Principles have no application to the respondent. 24 The Information Privacy Principles which are identified by the applicant in the relevant portions of his claim are Principles 7, 8 and 9. The obligation imposed on a record-keeper by clause 1 is subject to any applicable limitation in a law of the Commonwealth that provides a right to require the correction or amendment of documents. Nor does the Act bestow any power upon the Court to grant mandamus or certiorari in respect of breaches of the Privacy Act . However, the Court has power under the Administrative Decisions (Judicial Review) Act 1977 (Cth) ('ADJR Act') to declare an administrative decision invalid if it has been made unlawfully. The applicant has claimed that, in making the decision upon his entitlement to incapacity compensation, the respondent has committed breaches of the Information Privacy Principles. 28 The applicant relies solely upon breaches of the Privacy Act to make his claim. However, in order to bring a claim to set aside an administrative decision to this Court, it is not sufficient that the respondent has breached provisions of the Privacy Act which are binding upon it. To entitle the applicant to relief, he must also establish that a breach of those principles would render the decision invalid. 29 No submissions have been made on this issue. However, the Court will assume for the purposes of this decision that, if a breach of the Privacy Act is established, this would render the decision of the respondent invalid. 30 The Court has looked closely at the material provided by the applicant and the Information Privacy Principles. For the reasons which follow, I am not satisfied that any breach of the Privacy Act is established. It appears to be the case that the applicant has, perhaps understandably given that he is not legally trained, misunderstood the nature and meaning of the Information Privacy Principles. 31 With respect to the report of Dr Silva, I agree with the respondent's submission that it is not at liberty to alter a medical report merely because the conclusions expressed therein are contrary to the opinions of others. The medical report is intended to be a record of the opinion of the medical practitioner who completed it. That record may not be altered except by, or with the consent of, that medical practitioner. Otherwise, the report is no longer an accurate representation of the opinion of the medical practitioner. Accordingly, the claim by the applicant that Ms Tate had an obligation to correct the record under Principle 7 is incorrect. She had no power to alter the report, except with the express authority of Dr Silva. 32 The applicant made many challenges to the contents of Dr Silva's report. The challenges of substance were to Dr Silva's medical opinions. The applicant was entitled to provide evidence to the respondent which refuted those opinions. However, given that the claim relates to an area of medical expertise, he would require medical evidence to support his challenges to Dr Silva's report, or alternatively, would require evidence that Dr Silva's report contained a significant objective error (for example, that the report related to the wrong patient). If the applicant had provided information of this kind to the respondent, it would have been obliged to consider it and perhaps take further steps to ensure the information it had was accurate. However, the applicant's submissions to the respondent neither provided conflicting medical evidence, nor pointed to any significant error in the factual premises on of the report. Certainly, there were some mistakes in the report, such as typographical errors, which are acknowledged by the respondent, but these do not make the report inaccurate in any substantial way. 33 The applicant also alleges that the medical report draws incorrect conclusions in respect of his injuries. However, this is a question of medicine and of law, not a factual premise which could be challenged without medical evidence. In the absence of such evidence, the respondent was entitled to rely upon Dr Silva's report as representing an accurate, up to date and complete summation of the applicant's medical condition. 34 The applicant has suggested that the medical report was obviously incomplete, because, for example, it did not provide details of the x-rays which had been viewed, and did not include an impairment rating. The applicant says that the respondent should have taken further steps to complete his record in accordance with Principles 7 and 8. However, I do not consider that every possible detail relating to the applicant's medical condition is required to be included in the report before it can be considered as 'complete' by the respondent for the purposes of the Principle 8. A medical report might be incomplete if, for example, it did not consider the whole of the applicant's claimed condition, or if it entirely ignored significant elements of an applicant's medical history. However, the allegations made by the applicant in this matter do not raise these issues but rather refer to smaller, less significant details which are not included in the report. I do not consider that the absence of these details renders the report incomplete. 35 The applicant also suggested that it was obvious that the report was not up-to-date, as it relied upon medical reports, the most recent of which was three years old. I agree that the x-ray reports relied upon were not recent. However, the applicant has overlooked that his recent visit to Dr Silva was itself a source of up to date medical information. Dr Silva was correct to consider the applicant's medical history in making an up to date diagnosis based upon his own observations and examination of the applicant. 36 It follows from the above that I do not consider that the respondent was in breach of Principle 8. 37 The applicant has also made allegations that the report of Dr Silva contains information which is not relevant to his medical condition. The applicant alleges this is a breach of Principle 9. However, I consider that, unfortunately, the applicant has misunderstood the nature of the principle. Principle 9 does not prohibit a report from containing information which is not relevant to the decision which is to be made. Rather, Principle 9 prevents the medical practitioner or the respondent from using information which it has gathered for the purpose of assessing his right to compensation for any other purpose. For example, the respondent could not provide the applicant's medical details to a newspaper, or provide his address to a local real estate agent, because those are not the 'relevant purpose', that is, the purpose for which the information was collected. The effect of Principle 9 is that the respondent is only entitled to use the information in the report to assess his right to compensation for incapacity. The applicant has not claimed that the respondent has misused personal information provided by him to it. Clearly, the respondent used the medical report for the purpose of determining his claim, which is the precise purpose for which it was collected. Accordingly, I am not satisfied that a breach of Principle 9 has occurred. Accordingly, the basis of any relief which the Court might grant under the Privacy Act or the ADJR Act is not established, and I must dismiss the application. 39 I would note in conclusion that the ultimate objective of the applicant is to have the merits of his claim reconsidered, and his real objection is to Dr Silva's report and the decision to terminate his compensation payments. The applicant has a right of review in the Administrative Appeals Tribunal, and the period in which the applicant may lodge an appeal without leave has not yet expired. Unlike this Court, whose role is limited to judicial review, the Tribunal is a forum which is able to determine the whole of the matter to ensure that the correct and preferable decision is made. 40 It is not the function of this Court to assess the merits of the applicant's claim for continuing compensation payments, nor do I have sufficient material before me to do so. The only observation I would make is that I consider it would be of great benefit to the applicant if he were to obtain independent medical and legal advice which would give him a better understanding of the merits of his claim. 41 The respondent has sought an order for costs. Since the applicant has been unsuccessful, it is appropriate that an order be made, but I will postpone its operation for a period of six months in recognition of the applicant's current impecunious state. I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Cowdroy. | decision to terminate compensation payments whether decision involved breaches of the privacy act 1988 (cth) administrative law |
The basis of the motion is to be found in proceeding number 4111 of 2006 in the Equity Division of the Supreme Court of New South Wales between Andrew Carroll as trustee for the Hobbs & Carroll Property Trust as plaintiff and Benson Communications Pty Ltd as trustee for the Grantham Project (Trust) (BCPL) as defendant (the Supreme Court Proceeding). In the Supreme Court Proceeding, in September 2008 (see [28] below) the Supreme Court ordered and declared that: Upon the taking of accounts pursuant to the order of the Court made on 23 February 2007 the amount owed by the Defendant to the Plaintiff is $446,314.14. The Defendant pay to the Plaintiff the sum of $446,314.14. Each party pay its own costs. On 24 September 2008 judgment was given and entered substantially in the terms of the paragraphs numbered 1, 2 and 3 set out above. In summary, the respondents submit, first, that the claims or some of the claims made in this proceeding could only have been made in the Supreme Court Proceeding, and, second, that the subject matter of this proceeding properly belonged to the Supreme Court Proceeding so that the applicants are precluded from pursuing this proceeding by reason of the principle commonly associated with Henderson v Henderson [1843] EngR 917 ; (1843) 3 Hare 100 (67 ER 313) and Port of Melbourne Authority v Anshun Proprietary Limited [1981] HCA 45 ; (1981) 147 CLR 589 ( Anshun ). In my opinion, the motion does not succeed for the reasons set out below. At all material times the first respondent, Mr Carroll, was a director of the second respondent, Hobbs & Carroll Partnership Pty Limited as trustee for Hobbs & Carroll Property Trust (HCPPL). It is important to attend to the chronological sequence of events. On 25 November 2004 HCPPL and BCPL entered into a Memorandum of Understanding (MoU) in relation to the purchase of a property known as "The Grantham", 1 Grantham Street, Potts Point (Property) and the development of the Property as an apartment building (Project). The relationship between HCPPL and BCPL so established was referred to as the "Grantham Development Partnership". Mr Carroll represented HCPPL and Mr Benson represented BCPL in the negotiations for the MoU and in all subsequent dealings. HCPPL and BCPL entered into the MoU expressly in their capacities as trustees of the respective trusts. On 30 September 2005 HCPPL retired as trustee of the Hobbs & Carroll Property Trust and Mr Carroll became trustee in its place. The Project was not carried out, apparently for lack of funds. Mr Carroll in his capacity as trustee for the Hobbs & Carroll Property Trust commenced the Supreme Court Proceeding against BCPL on 7 August 2006. In the Supreme Court Proceeding Mr Carroll (as trustee) sought against BCPL (as trustee) a declaration that the partnership known as the Grantham Development Partnership between Mr Carroll and BCPL was dissolved on 31 May 2006 or, alternatively, on the date of the filing of the summons on 7 August 2006. Mr Carroll sought an order that that partnership be wound up under the direction of the Court, the appointment of a receiver, and an order that accounts be taken between himself and BCPL as partners with a view to determining the extent, if at all, to which each of the partners was, as between themselves, liable to contribute to the discharge of the partnership's liabilities or entitled to share in any surplus after the discharge of those liabilities, from the sale of partnership assets or entitled to be recouped by the other partner. The relevant order made (by consent) in the Supreme Court Proceeding on 23 February 2007 is referred to at [3] above. The "Partners" were the plaintiff and the defendant in the Supreme Court Proceeding namely Mr Carroll (as trustee) and BCPL (as trustee) and the "Partnership" was the partnership between them said to be known as the Grantham Partnership. It is desirable to pause here. Although neither the summons nor the order identified the time of commencement of the partnership to which it referred, that commencement could not have been earlier than 30 September 2005, the date when Mr Carroll replaced HCPPL as trustee. It may have been later but it could not have been earlier. The partnership said to be the subject of the Supreme Court Proceeding was a partnership between Mr Carroll and BCPL. It is a commonplace that upon an agreed change in the members of a partnership, the old partnership comes to an end and a new one begins. It might have been possible for a tripartite "novation" agreement to be entered into by BCPL, HCPPL and Mr Carroll overcoming some of the consequences of that well established legal position. In any event, there are limits to what can be done by a novation agreement in the case of a partnership. The critical issue is when BCPL accepted Mr Carroll as partner in place of HCPPL. By consent, on 10 August 2006, the Supreme Court appointed Anthony Elkerton of Pitcher Partners receiver of the partnership (between Mr Carroll and BCPL) with certain powers. In his affidavit made on 19 January 2009 and filed in this proceeding, Matthew Thomas Kelly of the respondents' firm of solicitors states that on that date the earlier partnership between BCPL and HCPPL was "dissolved". This assertion is consistent with my statement above that the new partnership could not have commenced earlier than 30 September 2005. It would have commenced when Mr Carroll and BCPL agreed, expressly or by implication, that it commenced. On 1 September 2006 in the Supreme Court Proceeding, BCPL applied for and was granted leave to file a cross-claim by 14 September 2006. On 21 September 2006, BCPL's then solicitors sought an extension of time for the filing of the cross-claim to 29 September 2006. The evidence does not show whether the extension of time was granted. In any event BCPL never did file a cross-claim. On 23 February 2007 the Supreme Court made by consent the order for the taking of partnership accounts to which I referred at [3] above. On 2 March 2007, Mr Elkerton as receiver appointed by the Court filed a verified report to the effect that he had: Mr Elkerton's report began by referring to the Grantham Development Partnership as having been established in November 2004 by an MoU entered into by Mr Carroll as trustee for the Hobbs & Carroll Property Trust and Mr Benson as trustee for BCPL as trustee for The Grantham Project (Trust). This was wrong, and not only because of the obvious slip. As noted earlier, the MoU of 25 November 2004 was entered into by HCPPL (not Mr Carroll) as trustee for the Hobbs & Carroll Property Trust and BCPL (not Mr Benson) as trustee for The Grantham Project (Trust). On 23 March 2007 the Supreme Court ordered that the receivership be terminated. Mr Benson and BCPL launched the present proceeding on 3 July 2007, while the Supreme Court Proceeding was still unresolved. It was noted in para 3 of the statement of claim that accompanied the application that Mr Carroll claimed to have replaced HCPPL as the trustee of the Hobbs & Carroll Property Trust as from about September 2005 (the pleading actually states that Mr Carroll claimed to be the trustee of "HCPPL" from around September 2005 but this was clearly an error). I mention para 3 of the statement of claim because Mr Benson was to assert in para 4 of an affidavit made by him on 28 January 2009 in this proceeding that he had not become aware of the change of trustee until an affidavit made by Mr Carroll was filed in the Supreme Court Proceeding on 9 August 2007 referring to that change. Clearly, however, Mr Benson was aware of the change of trustee from HCPPL to Mr Carroll at least a month earlier when he and BCPL launched this present proceeding on 3 July 2007. An amended statement of claim (ASC) filed on 18 May 2009 alleges several causes of action. These are summarised in some detail below. The centrepiece could be said to be the MoU entered into on 25 November 2004 by HCPPL and BCPL and its related negotiations. By the MoU, BCPL and HCPPL had agreed that as soon as practicable they would use their reasonable endeavours to negotiate and agree upon a transaction structure that would include certain features that were set out in the MoU. It is not necessary for me to refer to all of them. The parties, BCPL and HCPPL, were to be 50% participants each in the Project (more precisely, the MoU stated that the Hobbs & Caroll Property Trust and the Grantham Project (Trust) or their nominees were each to own 50% of the Venture); it was intended that each would be able to acquire beneficially a right to one apartment in the proposed apartment building; BCPL was to be entitled to a payment of $250,000 for having found the development opportunity; and apart from an initial deposit, the Project was to be funded by borrowings. In the Supreme Court Proceeding the MoU seems to have been treated as expressing the terms of the partnership between Mr Carroll and BCPL the subject of that proceeding. That is to say, in the Supreme Court Proceeding, Mr Carroll and Mr Elkerton seem to have proceeded on the erroneous assumption that Mr Carroll had been BCPL's partner right from the time when the MoU was signed on 25 November 2004. On 10 December 2007 the Supreme Court noted in short minutes of order that the receiver had paid certain money into court and further noted the agreement of the parties (Mr Carroll and BCPL) as to how that money was to be distributed. The short minutes of order also recorded that the payments to be made to the parties were without prejudice to the claims in either this present Federal Court proceeding or the Supreme Court Proceeding and that those payments might be pleaded by way of set-off to any award made in this Federal Court proceeding. The short minutes of order in evidence are not signed but Mr Kelly's affidavit states that they were provided to the Supreme Court, and that notations and orders were made in accordance with them. On 11 December 2007 BCPL filed a notice of motion in the Supreme Court Proceeding seeking a transfer of that Proceeding to this Court for determination concurrently with this present proceeding, but on 27 March 2008 the Supreme Court dismissed BCPL's motion with costs. The present respondents did not apply for a transfer of this proceeding to the Supreme Court. However, the solicitors for the respondents wrote to the solicitors for the applicants on 17 April 2008 advising that in the light of the Supreme Court's dismissal of BCPL's motion for a transfer to this Court, they took the view that it was an abuse of process for the present applicants to pursue this proceeding in this Court. They asked the applicants to consent to an order for dismissal of this proceeding on the basis that each party bear its own costs, indicating that if the applicants did not agree, they were instructed to apply for an order for dismissal or permanent stay of this proceeding. On 23 April 2008, in circumstances that are outlined in the reasons for judgment referred to at [31] below, I ordered that this proceeding be dismissed; that the order of dismissal not be entered without leave of the Court; that the respondents have liberty to apply at any time by motion on notice supported by affidavit for an order that the order of dismissal be entered; and that the applicants have leave to apply at any time by motion on notice supported by affidavit for an order setting aside the order of dismissal and the order granting liberty to the respondents to apply for the order to be entered. On 22 May 2008, the applicants filed a notice of motion seeking a setting aside of the order of dismissal. In September 2008 the Supreme Court Proceeding was settled. The parties filed short minutes of order dated 17 September 2008 on 18 September 2008 in terms of paras 1, 2 and 3 set out at [3] above. As noted at [4] above, on 24 September 2008 the Supreme Court gave judgment in the terms of the short minutes of order of 17 September 2008. On 10 October 2008 Mr Carroll served a creditor's statutory demand dated 7 October 2008 on BCPL requiring payment of the amount of the Supreme Court judgment, namely $446,314.14. On 24 October 2008 BCPL commenced proceeding NSD 1674 of 2008 in this Court seeking an order setting aside the statutory demand (the Statutory Demand Proceeding). On 6 November 2008, I dealt with the motion brought by the applicants in this proceeding to set aside the order of dismissal of 23 April 2008, and ordered that the order of dismissal be set aside: see Benson v Carroll [2008] FCA 1729. On 26 May 2009, Mr Carroll as respondent in the Statutory Demand Proceeding filed a notice of motion seeking an order that the Statutory Demand Proceeding be heard concurrently with the present Summary Dismissal Motion. The Statutory Demand Proceeding and the Summary Dismissal Motion were listed for hearing on 1 June 2009 on which date I ordered that the Statutory Demand Proceeding be dismissed and that BCPL pay Mr Carroll's costs of that Proceeding: see Benson Communications Pty Limited v Carroll [2009] FCA 632. The hearing therefore continued on the basis that it was only the Summary Dismissal Motion that was to be dealt with. I will use abbreviated forms of reference in the ASC. Numerals in bold in square brackets are references to paragraphs so numbered in the ASC. In about August to September 2004, Mr Carroll, alternatively HCPPL through its director Mr Carroll, made representations to Mr Benson (First Representations) [7] . Generally speaking, these were representations as to Mr Carroll's financial capacity and business acumen relevant to the success of the Project. On or between 27 August 2004 and 1 September 2004, Mr Carroll, or alternatively HCPPL through its director Mr Carroll, made further representations relevant to the success of the Project to Mr Benson (Second Representations) [8] . In reliance on the First and Second Representations, Mr Benson ceased negotiating with other parties who had expressed an interest in purchasing and developing the Property with him [10] . In reliance on the First and Second Representations, on or about 1 September 2004 Mr Benson and Mr Carroll entered into an oral agreement (Agreement) evidenced in writing relating to the purchase and development of the Property [11] . The Agreement identified the contributions that Mr Benson and Mr Carroll, respectively, were to make to the Project, the benefits they were to gain and the responsibilities they would have in relation to it. The written form of the Agreement was agreed by Messrs Benson and Carroll, though not executed, on or about 29 September 2004 [11] . There were express and implied terms of the Agreement [12], [13] . On 7 October 2004, in reliance on the First and Second Representations, and in consideration of the Agreement, Mr Benson agreed to borrow, and did borrow, $50,000 from Mr Carroll to be repaid from an "original fee" [of $250,000 (excluding GST) that was to be paid to Mr Benson by the Venture] within 21 days after a binding MoU was executed with the Vendor (Loan Agreement) [14] . On 7 October 2004, Messrs Benson and Carroll executed the Loan Agreement [15] . As at 7 October 2004, Messrs Benson and Carroll "had agreed upon all the terms of the MOU/Agreement and intended no departure from that agreement, subject to formally executing the Agreement in written form" [16] . As at 7 October 2004 the Agreement created legally binding obligations on Mr Carroll and Mr Benson [17] . In late October 2004 Mr Carroll made further representations to Mr Benson relating to the desirable structure of the Venture from a taxation viewpoint (Tax Structure Third Representations) [18] . If Mr Carroll intended by way of the Tax Structure Third Representations that the written MoU would vary the Agreement so as to limit his personal responsibility to perform his obligations under it, Mr Carroll did not disclose this to Mr Benson, yet he had a duty to make such a disclosure and by his silence represented that he would continue to meet his obligations under the Agreement (Representation by Silence Fourth Representation) [20]-[23] . Mr Benson, alternatively BCPL, would not have executed a MoU with HCPPL as opposed to with Mr Carroll if the effect of doing so would be to release Mr Carroll from his obligations under the Agreement [24] . In reliance on the Tax Structure Third Representations and the Representation by Silence Fourth Representation, Mr Benson agreed to the further terms of an amended agreement (Amended Agreement) [25] . The MoU contained certain implied terms to the effect that Mr Carroll and Mr Benson warranted that HCPPL and BCPL respectively would perform their obligations under the Agreement (Implied Terms) [26] . Alternatively, Mr Benson and Mr Carroll respectively warranted in a collateral agreement performance by their respective companies of the Agreement (Collateral Warranty) [27] . In reliance on the Tax Structure Third Representation, the "Grantham Development Partnership" was registered as a business name on 1 November 2004 owned by HCPPL and BCPL [28] . In reliance on the First and Second Representations, the Tax Structure Third Representations and the Representation by Silence Fourth Representation (Combined Representations), on 24 November 2004 BCPL and HCPPL entered into a MoU dated 24 November 2004 with the Vendor for the purchase and development of the Property [29] . In reliance on the Combined Representations, on the following day, 25 November 2004, Mr Benson caused BCPL to enter into an MoU with HCPPL [30] . The parties to the MoU dated 25 November 2004 executed it with the intention of being bound to acquire and develop the Property according to the terms expressed in it, and to formalise the Amended Agreement by executing a further formal agreement not in different terms (MoU evidencing Amended Agreement) [30A] . In the further alternative, the parties to the MoU of 25 November 2004 signed it on the assumption that a contract would be entered into to acquire and develop the Property and that the other party would not abandon the Project for a reason pertaining to its own interests (Quantum Meruit Claim) [30B] . The Combined Representations were warranties made by Mr Carroll and HCPPL to induce BCPL to enter into the Amended Agreement and the MoU dated 25 November 2004, and BCPL relied upon the Combined Representations in entering into the Amended Agreement and that MoU (Second Collateral Warranty Claim) [30C]. The Combined Representations created an assumption or expectation in the minds of the applicants that Mr Carroll and HCPPL would act to fulfil those representations and the Combined Representations were intended to induce the applicants to adopt that assumption or expectation; the applicants gave up the opportunity to development the Project with others relying on that assumption or expectation; and the respondents knew or intended that the applicants would not develop the Project with others because of the Combined Representations (Equitable Estoppel Claim) [30D] . The First and Second Representations, the Tax Structure Third Representations, and the Combined Representations were all made in trade or commerce [9], [19], [33](a) . The Combined Representations were representations as to future matters within s 51A of the Trade Practices Act 1974 (Cth) (TPA) or s 41 of the Fair Trading Act 1987 (NSW) (FTA) [32] . Mr Carroll owed a duty to take reasonable care in making the representations about his capacity or that of HCPPL to meet the obligations to which he or it was bound by the Agreement and the Amended Agreement [34] . The Combined Representations were made by Mr Carroll, or alternatively by HCPPL, to Mr Benson or alternatively to BCPL in breach of their duty of care and negligently and in contravention of the TPA and FTA [35] . In these circumstances the Combined Representations were misleading or deceptive in contravention of s 41 or 42 of the FTA or s 51A or 52 of the TPA, and further or alternatively were negligently made [36] . In the alternative, in so far as the Combined Representations were made by Mr Carroll on behalf of HCPPL to Mr Benson on behalf of BCPL, Mr Carroll aided and abetted, counselled or procured, or was directly or indirectly knowingly concerned in, the contraventions within the meaning of s 75B of the TPA [the pleading omits any reference to the comparable provision of the FTA] [37] . As a result of the matters pleaded in paras 31-37, the applicants or alternatively one of them suffered loss and damage for which Mr Carroll or alternatively HCPPL is liable. Further or in the alternative, Mr Carroll as a director of HCPPL assumed a personal responsibility for the obligations of HCPPL under the MoU dated 25 November 2004 so as to create a special relationship between him and Mr Benson, or alternatively between him and BCPL [40] . Mr Benson, or alternatively BCPL, executed with HCPPL the MoU on 25 November 2004 in reliance on his or its special relationship with Mr Carroll [41] . HCPPL breached the MoU dated 25 November 2004 [42] . Mr Carroll personally directed, procured or assisted HCPPL to act in the manner complained of and as a result of the special relationship between Mr Carroll and Mr Benson, or alternatively between Mr Carroll and BCPL, Mr Carroll is personally liable for the loss sustained by Mr Benson or alternatively by BCPL arising from the breaches of the MoU by HCPPL. The same particulars of loss are given [43] . Mr Carroll breached the Agreement or the Amended Agreement or the Collateral Warranty by failing to do certain things [45] . Alternatively, HCPPL breached the Amended Agreement by failing to do certain things [46] . In so far as BCPL or Mr Benson suffered loss or damage as a result of HCPPL's breach of the Amended Agreement, Mr Carroll is liable for that loss under the Collateral Warranty [47] . The applicants or alternatively one of them has suffered loss and damage as a result of the breach of the Agreement, the Amended Agreement or Collateral Warranty by Mr Carroll, or alternatively the breach of the Amended Agreement by HCPPL. The same particulars of loss are given [48] . As to para 30B, in circumstances in which Mr Benson and/or BCPL had performed beneficial work not intended to be gratuitous, and Mr Carroll and HCPPL unilaterally abandoned the Project not for any reason associated with a bona fide disagreement concerning the terms of the agreement to be entered into but for reasons which pertained to their own position, Mr Benson and/or BCPL are entitled to payment on a quantum meruit for work and expenses and compensation for the loss of opportunity to profit from the purchase and development of the Property (Quantum Meruit Restitution) [49] [50] . As to para 30C, the warranties were broken and Mr Benson and BCPL repeat para 35 and say that as a result Mr Benson and/or BCPL has suffered loss and damage and they repeat the particulars in para 38 (Breach of Second Collateral Warranty) [51] [52] . Finally, as to para 30D, Mr Carroll and HCPPL resiled from the arrangement or understanding in abandoning the Project and failed to act to avoid the detriment suffered by Mr Benson and/or BCPL and he and/or it has suffered loss and damage and repeats the particulars in para 38 (Equitable Estoppel Claim) [53] [54] . According to [55] , the applicants claim general damages and equitable compensation on various bases. (b) A declaration that the Amended Agreement created a legally binding relationship between Carroll and Benson. (c) A declaration that the Amended Agreement contained the implied terms pleaded in paragraph 25 above. (d) Alternatively, a declaration that the Collateral Warranty is a term of the Amended Agreement and is legally binding on Carroll for any failure by HCPPL to perform it [sic] obligations under the written Memorandum of Understanding dated 25 November 2004. Unless there is a pleading that a contract has come to an end, there is no cause of action to recover general damages for breach of the contract because the loss has not crystallised: it may transpire that here will be no loss. Nor is the claim to recover $250,000 and interest on that amount sustainable in the absence of the pleading of a contractual time for payment and the pleading of facts showing that that time for payment arrived. While the ASC is rather lengthy and detailed, upon analysis it suffers from some deficiencies. For example, it fails to distinguish between the two partnerships (see below). There is an allegation of abandonment of the Project by the respondents, but no particularisation of the abandonment or claim as to the time of it. I would have expected a claim by the applicants of wrongful repudiation of contract and of the acceptance of that wrongful repudiation. Where that rule applies the Court may order that a proceeding be stayed or dismissed generally or in relation to a particular claim for relief. Subrule (1) provides that r 5 applies if the Court is satisfied that, for the proceeding generally or for a claim for relief in it, the proceeding or claim is "frivolous or vexatious" or "an abuse of the process of the Court". The respondents rely on the "abuse of process" limb. The respondents have not referred to the "no reasonable prospect" of success ground referred to in s 31A(2) of the Federal Court of Australia Act 1976 (Cth). Whether this ground or the abuse of process ground is relied on, the Court should deny the applicants a final hearing only if the ground is clearly established. In my opinion, neither ground is clearly established here. As noted earlier, the respondents submit that some of the claims made by the applicants in this proceeding could only have been asserted in a taking of partnership accounts. The respondents have not, however, adequately identified the claims said to be of that kind. The respondents accept that there are other claims made by the applicants in this proceeding that could not have been addressed as part of a taking of partnership accounts, and submit that those claims should have been advanced by cross-claim in the Supreme Court Proceeding in accordance with what I shall describe as "the Anshun principle". The respondents submit that the claims of the second kind are so intertwined with those of the first kind that both kinds should have been dealt with in the Supreme Court Proceeding. In my opinion, the respondents' submissions gloss over many difficulties. In the first place, as noted earlier, there were two partnerships. There was the partnership between BCPL as trustee and HCPPL as trustee constituted by the MoU dated 25 November 2004 (the Earlier Partnership) and in the second place, at least according to Mr Carroll and apparently accepted in the Supreme Court Proceeding by BCPL, there was a partnership between Mr Carroll and BCPL from 30 September 2005 down to the time of the termination or dissolution of that partnership, whenever that was (the Later Partnership). It may be that the parties to the Later Partnership, by their course of conduct, accepted that the terms of the MoU dated 25 November 2004 governed the Later Partnership, but there were two partnerships nonetheless, each existing during a different period of time. The Supreme Court Proceeding could only have related to the Later Partnership because HCPPL was not a party to that Proceeding. In any event, it is plain that it did so because in orders made in that proceeding, the expression "the Partnership" was defined to refer to the partnership between Mr Carroll (as trustee) and BCPL (as trustee). This included identification of the property of the Later Partnership (as distinct from the separate property of the individual partners); the incomings and outgoings of the Later Partnership; and unsatisfied liabilities of the Later Partnership and the dealings by the Partners with the Later Partnership. The only claim made by the applicants in the present proceeding that might be said to be of a kind to fall within the scope of the taking of partnership accounts is the claim for the originating fee of $250,000. Upon analysis, however, that amount never became payable for the reason that the time for payment of it, namely "as soon as possible ... provided that the Venture [was] likely to return a profit at least equal to $250,000" never arrived. In fact the applicants refer to that sum of $250,000 merely as a particular of the loss and damage suffered by reason of the respondents' conduct for which general damages are sought. The present proceeding is a claim for general unliquidated damages, not a claim for any particular liquidated amount (see [63], [75] above). It may have been reasonable for the claims in respect of both the Earlier Partnership and the Later Partnership, including the present applicants' claim for general damages made in the present proceeding, to be wrapped up together in the Supreme Court Proceeding which would, in that event, have gone far beyond the taking of accounts in respect of the Later Partnership. It cannot be said, however, that any of the claims made in the present proceeding could only have been properly advanced in the Supreme Court Proceeding. I therefore do not accept the respondents' first ground of attack on the present proceeding. I turn now to Anshun . According to Anshun , the question to be asked in Australia in relation to the respondents' second ground of attack is not whether the claims advanced in the later proceeding "could" more conveniently have been advanced in the earlier proceeding. The test is not whether it would have been more efficient and less wasteful, in terms of judicial and other resources, if the issues in the later proceeding had been made the subject of the earlier proceeding. Anshun itself was a case of inconsistency between the determination of the earlier proceeding and the making of a claim in the later proceeding --- a circumstance that does not attend the present case. In Anshun , a workman was injured in the course of his employment when a load of girders handled by a crane being used by Anshun Pty Ltd (Anshun) and hired from the Port of Melbourne Authority (Authority) struck him. Under the crane hiring agreement, the Authority enjoyed an indemnity by Anshun in relation to any injury arising directly or indirectly out of the use of the crane during the hiring period. The workman sued the Authority and Anshun. They claimed contribution from each other. The Authority's contribution notice, however, did not claim the indemnity. In the earlier proceeding, judgment was entered in the action against both defendants with costs, and it was ordered that Anshun should recover from the Authority contribution to the extent of 90% and the Authority from Anshun to the extent of 10% of those damages and costs. In the later proceeding, the Authority sued Anshun under the indemnity agreement to recover the amounts that the Authority had paid as damages and interest and for legal costs and disbursements. The primary Judge ordered that the Authority's proceeding be perpetually stayed on the ground that the Authority should have pleaded the indemnity in the earlier litigation. It will be seen that the determination of the cross-claims in the earlier proceeding decided the question of the extent of the liabilities inter se of Anshun and the Authority. It would be inconsistent with that determination for the Authority to be held entitled to recover 100% in the later proceeding. As Gibbs CJ, Mason and Aickin JJ noted, in the later proceeding the Authority asserted a right inconsistent with the right asserted in the earlier proceeding. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding. In this respect, we need to recall that there are a variety of circumstances, some referred to in the earlier cases, why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in other proceedings, e.g. expense, importance of the particular issue, motives extraneous to the actual litigation, to mention but a few. In Tanning Research Laboratories Inc v O'Brien [1990] HCA 8 ; (1990) 169 CLR 332 , Brennan and Dawson JJ stated (at 345) that it may be that Anshun is a case of mere issue estoppel. 1040, at p.1046] cannot be precluded from taking fresh proceedings merely because he could have and, if you will, should have counterclaimed on that cause of action in a forum chosen by the opposite party in proceedings in which the opposite party sued him. We do not read the majority judgment in Port of Melbourne Authority v. Anshun Pty. Ltd. as holding the contrary, except in a case where the relief claimed in the second proceeding is inconsistent with the judgment in the first: see especially at pp. 599-601. That is not the present case. Another consideration demonstrating the distinctness of the claims advanced by the present applicants from the taking of accounts in respect of the Later Partnership in the Supreme Court Proceeding concerns the capacities in which the present parties sue and are sued. In the Supreme Court Proceeding Mr Carroll and BCPL were parties in their capacities as trustees of different trusts and as partners. In the present proceeding Mr Benson sues not as a trustee and not as a partner. Although BCPL sues as trustee, it does not sue as a partner but in respect of wrongs allegedly done to it outside its role as a partner in a subsisting partnership. Similarly, Mr Carroll is sued not as a trustee and not as a partner, while HCPPL is sued as trustee but in respect of wrongs it is alleged to have done outside its role as a partner in a subsisting partnership. No doubt the Supreme Court Proceeding could have been substantially enlarged (and made much more complex) by the introduction of cross-claims and additional parties. The present point, however, is that the applicants were not compelled to embark on such a course at peril of abandoning the claims that they were advancing in this Court. I will now turn to certain authorities to which I was referred. The present case has some similarity to Sheaffe v Hungerford (1879) 1 QLJ (Supp) 51. In that case the plaintiff and the defendant agreed to enter into a partnership to form and carry on the business of a cattle station. The plaintiff was to provide the grazing country; the defendant 5200 head of cattle by instalments. After supplying some of the cattle, the defendant refused to supply any more. But the plaintiff has asked that the suit may be treated as one for the administration of the partnership affairs, and for a dissolution. There are in my opinion sufficient grounds to grant this application, but I need not state them as the defendant does not oppose a decree on this point. In any event, the claim for damages was one between the partners alone and was for breach or repudiation of the partnership agreement itself. The complexities to which I have already referred show that the circumstances of the present case are far removed from those in Sheaffe v Hungerford . A simple account may be taken at the trial, and where this occurs, the nature of the proceedings may be obscured. A judicial account involves the offsetting of credit items on both sides to reach a balance in favour of one party. The result can only be final if all relevant claims and cross-claims are either brought forward for adjudication or treated as abandoned. Clearly, it would not be open to a partner to advance a later claim to recover property that had been treated as partnership property in the taking of accounts or to contend in a later proceeding that the partners' "loan accounts" in the partnership books, on the basis of which the partnership accounts had been taken, were otherwise than what they had been treated as being in the taking of those accounts. The claims for unliquidated damages made by the applicants outside the scope of the partnership are of a different kind. Public Trustee v Kenward [1967] 1 WLR 1062 was also a case of the taking of partnership accounts. The plaintiff was judicial trustee of a deceased's estate. He sued the defendant for the balance found due by the defendant to the estate on an account and inquiry taken in earlier administration proceedings to which the defendant was a party. The defendant had not challenged the Master's certificate in that proceeding. The enquiry before the Master had related to a farming business carried on by the defendant in partnership with the deceased, in whom the farm was vested, and no evidence was adduced before the Master to suggest that the land was not the sole property of the deceased. On the plaintiff's application for summary judgment, the defendant sought leave to defend on the ground that he had a valid counterclaim for a share in the proceeds of sale of the farm land and the income thereof since the deceased's death and for the cost of certain improvements, on the basis that the land was an asset of the partnership. He offered an explanation of his failure to raise this point before the Master on the taking of partnership accounts. Buckley J held that the defendant was estopped by the Master's certificate from setting up the claim that the land was a partnership asset, since an allegation that it was would have been germane to the accounts and enquiry before the Master, which was directed to determining finally what sum the defendant should pay to the estate. If it were a matter which can be said properly to have belonged to that investigation of the relative rights of the defendant and testatrix's estate, then the fact that the defendant, whether it be by inadvertence or accident or as the result of his being unwisely advised or lacking advice, did not raise the point on any of those grounds would be no justification for allowing him to raise it now. Whether the farm was or was not partnership property lay at the heart of the Master's inquiry and must be taken to have been determined by the Master's certificate. The applicants rely on Gordon v Gibbons (1873) 12 SCR (NSW)(L) 40. That case concerned an unincorporated mining company formed under a deed of settlement. In accordance with the terms of the deed, the directors sued a member for calls. It was held (by majority) that the action did not lie because any recovery would be partnership property and the defendant was a member of the partnership. The Court distinguished a claim for damages or money which, when recovered, would be the plaintiff's own property. This case lends support to the applicants. The damages that they seek to recover would not be partnership property but would be their own property (in the case of BCPL, as trustee for the Grantham Project (Trust), but that is beside the point). The proceeding will be listed for the making of directions. I certify that the preceding one hundred and twelve (112) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren. | motion for summary dismissal partnership of two change of identity of one partner earlier partnership supplanted by later partnership claim for unliquidated damages as between partners proceeding between members of later partnership for the taking of accounts in the supreme court of new south wales whether present proceeding should be dismissed summarily as an abuse of process whether some claims made in present proceeding could only have been made as part of the taking of partnership accounts whether anshun estoppel applied held: motion for summary dismissal dismissed practice and procedure |
Subsequently, the decision of the Tribunal was set aside and the matter was remitted. The Tribunal again affirmed the decision not to grant a protection visa. The application to have this second decision by the Tribunal set aside by the Federal Magistrates Court was dismissed. This is an appeal from that court. 2 The grounds of the appeal are that the Federal Magistrate erred in failing to find that the Tribunal misunderstood and/or misconstrued the tests for refugee status on the grounds of a well-founded fear of persecution due to (a) imputed political opinion; and/or, (b) membership of particular social group. I will deal with each of these contentions in turn. 3 In support of his application for a protection visa, the appellant claimed that he was a citizen of Ukraine, that he had lived in Lviv and that he had had various occupations including television commentator and journalist. He said that he was a member of the Social National Party of Ukraine (SNPU) and that because of his affiliation with that party he was mistreated both physically and emotionally. He claimed that he also suffered persecution and threats from law enforcement agencies for his commentary on protests that had taken place in Lviv. This persecution allegedly included a savage beating by the militia and having a dog set on him. He also claimed that the militia had broken into his house, terrified his family, and confiscated tapes of him making speeches at meetings and protests. Those that attacked him, he said, told him to forget about his party and work as a journalist. His attempts to bring his attackers to justice were unsuccessful and he claims it is futile to seek help because of the corruption in Ukraine. 4 When the matter came before the Tribunal, the appellant made additional claims in his oral submissions. He claimed that he had been involved in the investigation of an oil substitution racket that resulted in some criminals being exposed and that, as a result, his son had been beaten by people involved in the racket. He also claimed that he feared these people would harm him if he returned to Ukraine. 5 The Tribunal made several findings of fact adverse to the appellant. It did not accept that he was a journalist as he had claimed. It also did not accept that he was a member of the SNPU party. As a result, the Tribunal held that if, as he claimed, the appellant was assaulted and attacked by a dog in late 2001, this was "neither because of any political affiliation he had at that time, [n]or because of any activities as a journalist covering political events. Both grounds of appeal depend on the Tribunal's finding that he, in the course of his employment, "was responsible for uncovering an oil substitution racket and that his efforts resulted in some criminals being apprehended and charged" and that "these criminals may have been able to escape proper punishment and that they resent the [appellant] for causing disruption to their criminal enterprise" and that they "may wish to harm him as revenge for what he did. However, the Tribunal has found that the [appellant] was neither a member of the SNPU, nor a political journalist/commentator. The Tribunal therefore concludes that he has no publicly identified political opinions in the party political sense. The Tribunal has considered whether the [appellant's] actions in exposing the criminal activities of the gangsters might have reflected some political opinion on his part, or have given rise to him being imputed with such an opinion. Such a situation could arise in particular cases of people campaigning against political corruption, for example. However, the Tribunal has concluded that the [appellant's] actions were taken as part of his employment and it is of the opinion that these actions, in this instance, would not give rise to any perception of him as having a 'political opinion' within the meaning of the Convention. 9 A close reading of the Tribunal's decision demonstrates that it did not take an overly narrow view of political opinion. The Tribunal did not confine 'political opinion' to people campaigning against official corruption. It merely mentioned that group as an example of one group on to which a political opinion might be imputed in order to contrast with the position of the appellant on to whom, in the Tribunal's opinion, such an opinion could not be imputed. 10 It has been held in several cases that the exposure of corruption can lead to the imputation of a political opinion: C v Minister for Immigration and Multicultural Affairs [1999] FCA 1430 ; (1999) 94 FCR 366; Klinko v Canada (2000) 184 DLR (4 th ) 14; Guzman v Minister of Citizenship & Immigration (1999) 93 ACWS (3d) 733; Berrueta v Minister for Citizenship & Immigration (1996) 109 FTR 159; Grava v Immigration & Naturalization Service 205 F 3d 1177 (2000). This is because the exposure in that instance is more likely to be seen as the reporting of criminal conduct rather than any form of opposition to, or defiance of, state authority or governance. The Tribunal made clear that it considered whether the appellant's activities would have given rise to such an imputation and concluded that they would not. This conclusion was open to the Tribunal and there is no reason to disturb it. The fact that the activities were undertaken as part of the appellant's employment was clearly an important factor in the Tribunal's reasoning but there is no indication, nor any reason to infer, that the Tribunal considered that this precluded an imputation of political opinion. The use of the words "in this instance" in the final sentence of the passage quoted above confirms this view. 12 For these reasons, the appeal on the ground of "imputed political opinion" fails. 14 In Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26 ; (2003) 197 ALR 389, 394 (per Gummow and Callinan JJ, Hayne J agreeing at 408, Kirby J to similar effect at 402-404), the High Court set out a series of steps that the Tribunal must follow when determining whether an applicant fell within the Convention definition of refugee (Article 1A(2)) by reason of a well-founded fear of persecution due to membership of a particular social group: "First the tribunal needs to determine whether the group or class to which an applicant claims to belong is capable of constituting a social group for the purposes of the Convention. That determination in part at least involves a question of law. If that question is answered affirmatively, the next question, one of fact, is whether the applicant is a member of that class. There then follow the questions whether the applicant has a fear, whether the fear is well-founded, and if it is, whether it is for a Convention reason. " As I have already mentioned, the Tribunal found that the appellant was neither a journalist nor a member of the SNPU. The only way that the appellant could fall within the group to which he claimed to belong was by his involvement in the exposure of the oil racket. 16 However, the Tribunal held that these circumstances do "not relate to the Convention. It is not because of any political opinion, for example. The Tribunal has asked itself whether the Convention motivation of 'particular social group' may have come into play, but has concluded that it has not. The [appellant] has not claimed, for example, that all employees or all 'inspectors' of the 'Lviv Committee of Citizen Rights Protection" are being targeted by criminals. Not is he claiming that those criminals are targeting any wider hypothetical social group such as 'people exposing criminal actions' or 'people exposing corruption. ' Rather, it is clear that the revenge the applicant fears is directed specifically at him because of his actions in uncovering their criminal activities. It is therefore not necessary to deal with the question of whether or not such hypothetical groups exist in Ukraine as 'particular social groups' within the meaning of the Convention. That is, the Tribunal considered that even if the appellant did belong to a particular social group within the meaning of the Convention, membership of that group is not the reason for his fear of persecution. Accordingly, the Tribunal concluded that it was unnecessary to follow the steps set out in Dranichnikov. He argued that the steps set out in Dranichnikov must be followed even if the Tribunal is of the view that the applicant's fear is unrelated to the membership of any such group. This is plainly incorrect. Courts will frequently skip over more difficult questions if the main issue can be determined from the answer to a simpler later question: in the law of negligence, there is no need to ask whether there was a duty of care if it is obvious that there has been no damage. In this case, moving to the last step in Dranichnikov was quite proper. 19 That question was whether the membership of a particular social group is the essential and significant reason (s 91 R(1)(a) of the Act) for the appellant's fear of persecution. The Tribunal answered that question in the negative, holding that "the revenge the [appellant] fears is directed specifically at him because of his actions in uncovering their criminal activities. Many social groups are defined by the actions of their members: whistleblowers ( Zheng v Minister for Immigration & Multicultural Affairs [2000] FCA 670) , informers ( Morato v Minister for Immigration, Local Government and Ethnic Affairs (1992) 111 ALR 417), trade unionists, Muslim women who do not wear traditional dress, parents in China ( Chan v Canada [1995] 3 SCR 593; Applicant A v Minister for Immigration and Ethnic Affairs [1997] HCA 4 ; (1997) 190 CLR 225). If a person from such a group fears persecution, it may be difficult to say whether the essential and significant reason for that fear is their membership of the collective or the individual action which causes them to be identified as a member of the collective. The distinction, according to Dawson J in Applicant A (at 243), "may sometimes be an unreal one. The primary focus must be upon what someone is rather than what they have done. This, according to Black CJ, "tells against the argument that a particular social group may be defined by reference to the sole criterion that its members are all those who have done an act of a particular character": (ibid. ) It is not permissible to define a "particular social group" by reference to the act that gave rise to the fear of persecution: Applicant A per Dawson (at 243), McHugh (at 263) and Gummow JJ (at 264). 22 Furthermore, a group will not be a particular social group within the meaning of the Convention if the only characteristic members have in common is a fear of persecution: Applicant S v Minister for Immigration and Multicultural Affairs [2004] HCA 25 ; (2003) 217 CLR 387, 400 per Gleeson CJ, Gummow and Kirby JJ. 23 While it is vital to accurately identify the "particular social group" ( Applicant A at 401), it is often quite difficult to do so. These difficulties have lead applicants and tribunals into error. In Dranichnikov , the Tribunal defined the group as "businessmen in Russia. " It concluded that membership of that group did not give rise to a validly held fear of persecution and so held against the applicant. The High Court explained that the correct social group, as the applicant had eventually argued, was "businessmen in Russia who publicly criticised law enforcement authorities for failing to take action against crime or criminals. As his first task with the INLA, the applicant was required to guard a group of innocent hostages. On learning that the hostages were to be executed, the applicant allowed them to escape without disclosing himself to his superiors. However, they subsequently learned of his disloyalty and he was captured and tortured. He escaped and fled to Canada with the assistance of the British authorities. His application for refugee status in Canada was partly founded on his membership of a particular social group. However, for a reason that is not clear from the decision, the particular social group pleaded was "members of the INLA" rather than "former members of the INLA who had betrayed the group in order to save innocent lives. " The Court concluded (at 744) that "no subsequent disassociation from this group ... had any impact on his fear" and that, therefore, it was not appropriate to say that his "fear was based on his status as a former member of the INLA. The fact that Ward might no longer be a member is merely a result of the persecution feared, not its foundation". This reasoning is difficult. It is not clear whether the Court regarded the group under consideration as being "current INLA members" or "current and former members" and, if it included former members, how the applicant could subsequently disassociate himself from the group. If the group were defined as "former members who had betrayed the group" the Court's reasoning would lose much of its force. 25 It is entirely proper to avoid identifying the appropriate "particular social group" if it is unnecessary to do so. Dranichnikov does not demand otherwise. 26 In Ward , the Supreme Court of Canada did not need to address the question of whether the applicant belonged to a particular social group within the meaning of the Convention. Rather, in my view, Ward was the target of a highly individualized form of persecution and does not fear persecution because of his group characteristics. Ward feels threatened because of what he did as an individual, and not specifically because of his association. His membership in the INLA placed him in the circumstances that led to his fear, but the fear itself was based on his action, not on his affiliation. It held that the appellant's fear is based on his individual action and not on his affiliation with any particular group. Having made that finding, there was no need to address the test set out in Dranichnikov . For this reason, the appeal fails on this ground also. I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finkelstein. | protection visa fear of persecution for reason of membership of particular social group or political opinion imputation of political opinion whether refugee review tribunal applied too narrow test whether tribunal must decide whether person is a member of a particular social group when the reason for the person's fear of persecution is not related to membership migration |
The applicant on the notice of motion is the respondent to the proceeding. I shall continue to refer to that party as the respondent. The proceeding was commenced early last year and is due to go to trial on Monday week. There has been recently a flurry of activity by the parties in relation to interlocutory proceedings as the parties attempt to ready themselves for the trial. This application was brought on short notice and has to be determined immediately and without having the benefit to reflect on either the pleadings, any facts upon which the parties have relied or the number of authorities which have been cited over the hearing this afternoon. 2 The principal proceeding concerns a claim by a distributor in Hong Kong against a pharmaceutical company in South Australia. The respondent, Hamilton Pharmaceutical Pty Limited, is a manufacturer of pharmaceuticals for distribution in Australia and outside Australia. It is asserted by the applicant that it entered into a distribution agreement with the respondent on 9 March 2000. The distribution agreement was backdated to 1 July 1999. The applicant claims that the distribution agreement was partly in writing and partly oral. The oral terms seem to be the matter of dispute between the parties. 3 The applicant claims that the respondent has breached the distribution agreement by engaging in part in parallel distribution in Hong Kong through another distributor. It is said that that conduct is in breach of the distribution agreement which provided the applicant with exclusivity. The applicant otherwise claims damages under s 52 of the Trade Practices Act 1974 (Cth). It also claims rectification of the distribution agreement to reflect the oral terms which it says bound the parties. The proceeding apparently was brought out of time and the applicant seeks an extension of time within which to bring the proceedings pursuant to the Limitations of Actions Act 1936 (SA). 4 The applicant also commenced proceedings in Hong Kong against a distributor of pharmaceuticals, Hong Kong Tung Tak Tong trading as Forward Company, which it says distributed pharmaceuticals supplied by the respondent through agents in Australia in breach of the distribution agreement. It has claimed damages and other relief against Forward Company in Hong Kong for Forward Company infringing the applicant's trade mark. 5 Extensive discovery seems to have been given by the parties to each other but, as this notice of motion shows, not to a satisfactory level, at least to the respondent. 6 The respondent has sought discovery of a number of categories of documents, notwithstanding that orders were made by the judge who is to be the trial judge, Finn J, on 8 April 2008 which purported to apparently address the matters which have been addressed today. 7 The first category of documents which is sought by the respondent relates to correspondence between the applicant and any third party, including any correspondence between the applicant and the second cross-respondent by any of their solicitors, in action number 3901 of 2002 in the High Court of Hong Kong. 8 There are two answers given by the applicant in response to this aspect of the application. First, it is contended the respondent has failed to identify any documents which it says the applicant has failed to discover. Secondly, the applicant contends it has not been shown that any of that correspondence would be relevant in relation to any of the issues raised on the pleadings in this proceeding. I want to make it clear that whilst many of the rules relating to discovery have changed over the recent past it is still a requirement of discovery that the document which is sought to be discovered is relevant to an issue raised on the pleadings in the sense described by the High Court in Mulley v Manifold (1959) 163 CLR 341. Attempts have been made today to show that there might be evidence which would indicate that some correspondence could be relevant to this proceeding. That, in my opinion, is not an appropriate way of addressing the question of discovery and, in particular, in addressing a question of discovery so late in the proceeding and so shortly before trial. 9 It seems to me, if the respondent wishes to identify documents which it says ought to have been discovered, it must be able to do so precisely by reference to the pleadings and by reference to the document which it says ought to be discovered. In other words, it ought to be able to discharge the obligation which lies upon a party seeking further and better discovery. In my opinion, the respondent has failed to do so in respect of this category of documents and for that reason alone I would decline to make the order sought. However, I am also not persuaded, at this stage, that any of the documents sought are relevant in the sense to which I have referred. 10 The second category of documents has three groups of documents within it. First, it contains a witness statement given by a director of the applicant; and secondly, it lists a witness statement given by a defendant in the Hong Kong proceedings. Both of those documents were filed in the proceedings in Hong Kong. The third group of documents, within this larger category, are documents which were discovered by the defendants in the Hong Kong proceedings. 11 The applicant has argued that it is not obliged to produce the witness statement of the applicant's director because it was a document filed in the Hong Kong proceedings and therefore unable to be used, and, in any event, has retained its privilege. In my opinion, that argument must be rejected. Order 38, rule 2A of the Rules of the High Court (HK) (Hong Kong Rules) provides for the exchange of witness statements. The applicant argued, however, as I have already said, that the document, or the statement, was protected by legal professional privilege and that privilege had not been waived by the filing of the statement in the Hong Kong proceedings. There are conflicting authorities on whether the filing of a witness statement indicates an implied waiver of legal professional privilege. 13 The two most recent decisions in this Court, Cadbury Schweppes Pty Ltd v Amcor Limited [2008] FCA 88 and Australian Competition and Consumer Commission v Construction, Forestry, Mining and Energy Union [2008] FCA 678 , indicate that any legal professional privilege in the statement is lost when the document is filed. 14 There are, as I have said, authorities contrary to those two decisions and I was taken to them by Mr Robertson, counsel for the applicant. In Nilsen Industrial Electronics Pty Ltd v National Semiconductor Corporation (1994) 48 FCR 337 , Olney J held that statements filed in legal proceedings continue to attract legal professional privilege unless and until they are put into evidence. In Complete Technology Pty Limited v Toshiba (Australia) Pty Limited [1994] FCA 1314 ; (1994) 53 FCR 125 , Hill J, whilst disagreeing with the reasons given by Olney J, reached the same conclusion that legal professional privilege reposed in the document until it was read. He, however, relied upon the implied undertaking as to discovery for that decision. 15 I think I should follow the more recent authorities of the Federal Court which preferred the line of authority which is to the effect that filing and service of a witness statement, without more, operates as a full or limited waiver. Upon that basis, it seems to me that I should make the order in paragraph 3.1 of the notice of motion which seeks the witness statement of the director of the applicant, Keung Kin Wah. 16 The second witness statement which is sought is that of Cheng Chun Keung, who was a defendant in the Hong Kong proceedings. Since this application has been made, that witness statement has been provided to the respondent by the defendant in the Hong Kong proceedings. However, the respondent continues to seek production of the statement by the applicant in this proceeding, so as to ensure that the document which they have is a complete copy of the document which was filed in the court. I think they are entitled to press for the production of that document. Mr Robertson did not suggest any privilege attached to this document, insofar, at least, as his client was concerned. 17 However, he relied upon the implied undertaking as to discovery, which he said bound his client in the Hong Kong proceedings and therefore prevented his client making discovery in these proceedings. Exhibited to the affidavit of Timothy Rupert Magarey sworn on 24 June 2008 was O 24 r 14A of the Hong Kong Rules. 18 That rule states the rule in Harman v Home Department State Secretary [1983] 1 AC 280. Mr Robertson said that his client was unable to produce the document, which it has discovered, by reason of that rule. It seems to me that there are two answers to that proposition. The first is that whilst, of course, the implied undertaking in relation to discovery binds a party, it does not prevent a party making discovery under obligations of other rules of court. No doubt the implied obligation must yield to inconsistent statutory provisions and to the requirements of curial process in other litigation, eg discovery and inspection, but that circumstance is not a reason for denying the existence of the implied obligation. 20 Chief Justice Mason's dicta was applied by Tamberlin J in Patrick v Capital Finance Pty Ltd (No 4) [2003] FCA 436 at [15] to [21]. The point which the Chief Justice made and which was applied in Patrick v Capital Finance Pty Ltd (No 4) [2003] FCA 436 is that, notwithstanding the implied undertaking, if rules of court of a jurisdiction apply to a party who has a document in that party's possession by reason of a process in another jurisdiction, that party is still obliged to comply with the processes in the second jurisdiction and make discovery of the document if it be an application for discovery and production if production follows upon discovery. For that reason, in my opinion, the document should be produced. 21 Secondly, there has been no suggestion made by the applicant that the applicant could not obtain a release from the implied undertaking in the High Court of Hong Kong. Indeed, the applicant has sought and obtained a release in relation to other documents. I infer from the fact that such a release has been obtained, that the applicant could obtain a release in relation to the implied undertaking in respect of the witness statement of Cheng Chun Keung. The same applies to the documents discovered by the defendants in the Hong Kong proceedings which are presently in the possession, custody or control of the applicant. The applicant has discovered those documents and the respondent seeks production of them. 22 Whilst those documents are subject to the implied undertaking referred to in O 24 r 14A of the Hong Kong Rules, in my opinion, consistent with the decisions in Esso Australia Resources Limited v Plowman [1995] HCA 19 ; 183 CLR 10 and Patrick v Capital Finance Pty Ltd (No 4) [2003] FCA 436 , the applicant should make production of those documents in this jurisdiction. No doubt the applicant will, at or before making production, apply to the High Court of Hong Kong for a release from the implied undertaking in relation to those documents. I should say that the defendants in the Hong Kong proceedings have indicated they have no objection to the documents being produced. 23 The third category of documents sought by the respondent relates to legal advice given by the applicant's solicitors to the applicant before the applicant and the respondent entered into the distribution agreement and subsequently. The respondent seeks an order that the Court instruct the applicant's solicitors in Hong Kong on or before Wednesday, 25 June 2008 to send their respective files from 1999 to 2006 forthwith to Piper Alderman Lawyers, solicitors for the applicant and the second cross-respondent in these proceedings. I am not prepared to make that order. I have no reason to doubt that the solicitors in Hong Kong have an understanding of their obligations in relation to their client's obligations to make discovery. I have nothing before me which would suggest that I should require them, if I was able and if I had such power, to send their files to South Australia for the management of the local solicitors. 24 I think, however, that the respondent has shown that there are some aspects of the applicant's legal advice which ought to be discovered in this proceeding. The applicant claims that it entered into the distribution agreement which has oral terms apparently inconsistent with the written terms. It claims, insofar as those written terms do not reflect the terms which were agreed upon by the parties, the distribution agreement ought to be rectified. 25 It would be important to know when the applicant entered into the distribution agreement and if it had advice in relation to the written terms of the distribution agreement. The applicant's counsel did not argue otherwise. In those circumstances, it seems to me that the applicant ought to discover any legal advice given to it in writing in relation to its entry into the distribution agreement. The applicant also contends that representations were made to it by an officer of the respondent which induced it to enter into the distribution agreement. Those representations relate to the oral terms which the applicant says forms part of the distribution agreement. 26 Again, I think it would be important for the respondent to know whether the applicant received legal advice in relation to the representations which were made by the respondent to the applicant in that regard. It also would be important, in my opinion, for the respondent to know whether the applicant received advice generally in relation to the terms of the distribution agreement and insofar as that advice would impact upon the applicant's claim for rectification. The respondent also sought discovery of the applicant's continuing legal advice after the distribution agreement was entered into until 2006. 27 It said that the applicant claims that, acting upon the representations which are pleaded in paragraph 84A and following, the applicant did things which, if the respondent's contention as to the terms of the agreement is right, means that the applicant has suffered damage. I am not persuaded that the advice given to the applicant after the applicant entered into the distribution agreement has been raised by the applicant in the way that the applicant has framed its case. In those circumstances, I will not make an order in relation to any advice given by the applicant's solicitors in relation to steps taken in relation to the damage which the applicant claims it has suffered. 28 The applicant needed an extension of time within which to bring these proceedings and claims that it learnt of the material facts at a particular time. I accept, as Mr Cox has argued, that it would be appropriate for the applicant to disclose any legal advice that the applicant obtained in relation to the matters relevant to its application for an extension of time. 29 The last category of documents which has been sought by the respondent was the file of the applicant's trade mark attorneys. In paragraph 17.5.6(d)(v)(C) of the applicant's amended reply, the applicant said that it admitted that it ultimately became registered as entitled to a trade mark in Hong Kong, pursuant to an application which was filed on 11 August 1999, but says, relevantly, that its trade mark attorneys were instructed by it to prepare the application in June 1999 without having particular knowledge, which the respondent asserted it had, subsequent to that date. It is important to know the state of mind of the applicant as at June 1999 and as at 11 August 1999 in relation to its application for trade mark. I accept, as Mr Cox has contended, that the applicant should disclose so much of its trade mark attorneys' file as would indicate the instructions given to the trade mark attorneys prior to June 1999 in relation to an application for registration of a Hong Kong trade mark and in relation to the application which was made on 11 August 1999. Otherwise, I see no reason to order the rest of the trade mark attorneys' file to be discovered or produced. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lander. | application for further and better discovery and production where applicant also commenced related proceedings in hong kong whether applicant obligated to discover and produce documents filed in or related to those proceedings including witness statements applicant obliged to comply with processes in this jurisdiction notwithstanding the implied undertaking as to discovery in the hong kong proceedings practice and procedure |
The applicant's claim is one for compensation arising out of alleged breaches of a contract of employment and the Trade Practices Act 1974 (Cth) in connection with the respondent's termination of the applicant's employment. The respondent seeks an order that the applicant attend a medical examination. The applicant does not agree to do so. The following circumstances are relevant. First, the applicant served a report from a consulting psychologist with respect to the applicant's current medical condition; the applicant, however, does not intend to rely on this report (see [4] below). Second, the applicant has given evidence on oath in an affidavit about his feelings concerning and consequential upon the termination of his employment. The respondent submits that it should be granted an order that the applicant attend a medical examination because this evidence is potentially relevant in at least three ways. First, the respondent says that the evidence is potentially relevant to the valuation of the applicant's claim for the loss of the chance to have continued in employment for the respondent until retiring age. Second, the respondent says that the evidence is potentially relevant to its defence based on provisions of the Workers Compensation Act 1987 (NSW) and the Safety, Rehabilitation and Compensation Act 1988 (Cth) which preclude claims for damages in respect of an injury sustained by an employee in the course of his or her employment. Third, the respondent says the evidence is potentially relevant to the question of whether the applicant has mitigated his loss, by seeking or obtaining alternative employment. The difficulty I have with the application is that the applicant has made no claim in these proceedings for any damages arising from an injury, be that injury physical or psychological. In circumstances where there is no positive claim by the applicant for any such damage, it does not seem to me that it is a reasonable requirement that, at the suit of the applicant's former employer, the applicant be required to attend a medical examination. The mere fact that the employer happens to be in possession of a medical report does not place this matter in any category different from any other application. This is because the applicant's counsel has made it clear beyond any doubt that the medical report is not relevant to any of the claims in the proceedings. It was obtained and served at a time when the applicant was contemplating an amendment to the statement of claim to include a claim for injury. However, no such claim is to be made in the proceedings and the applicant therefore does not propose to tender the medical report. In these circumstances, none of the grounds upon which the respondent said the evidence is potentially relevant arise. In short, I accept the applicant's submission that any evidence that is in the applicant's affidavit about his feelings in respect of the termination of his employment cannot be taken as evidence that he is, in fact, suffering from any form of medical condition or injury and, accordingly, could not be used for that purpose. In these circumstances, as the proceedings are presently constituted, there is no proper basis upon which I could or would require the applicant to attend a medical examination against his will. | whether applicant should be required to attend a medical examination where applicant served a medical report but does not intend to rely on the report at trial where no claim for physical or psychological injury whether in the circumstances applicant should be required to attend a medical examination against his will practice and procedure |
2 The Commissioner's submission is that costs should follow the event. SAGA's submission is that there should be no order as to costs. The basis for SAGA's submission is first, that the litigation was in the nature of a 'test case', so far as the Australian legislation is concerned and secondly, the Commissioner's concession, said to have been made immediately before the hearing, as to the correctness of SAGA's claim as to 'some 35%' thereof. In my reasons for judgment, I refer generally to those matters. Both grounds propounded by SAGA are essentially and substantially correctly based. 3 Moreover it was only shortly prior to commencement of the final hearing that the Commissioner conceded that 'meals and drinks' should not be considered to be part of the supply of real property (see in that regard [103] of my principal reasons for judgment). SAGA has been able to point to material in evidence demonstrative of the circumstance that 'meals and drinks' supplied by Australian hotels formed some 35% of what was originally contended by the Commissioner to be subject to taxation. 4 In my opinion the litigation raised important and difficult fiscal issues in particular on the construction of the legislation, and I am unable to acknowledge the Commissioner's characterisation of the litigation as 'very much private litigation and not litigation in the public interest'. Evidence was tendered as to the existence of at least 100 foreign tour operators potentially affected by the outcome to the proceedings. (ii) Orellana-Fuentes v Standard Knitting Mills Pty Ltd [2003] NSWCA 146 ; (2003) 57 NSWLR 282 at [125] per Ipp JA (with whom Spigelman CJ and Handley JA agreed). My conclusion is that in all the circumstances which I have identified, there should be no orders as to costs. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. | revenue case involving gst legislation need for recourse to overseas authority proceedings in nature of test case concession made by commissioner as to 35 per centum of original deductibility claim no order made as to costs costs |
The company was formerly known as the Institute of Executive Coaching Australia Pty Limited. 2 That company is a party to proceedings in the Industrial Court which have been brought by the plaintiffs, Ms Gorman and Corporate Impact Consulting Pty Limited. A question has arisen in the Industrial Court as to whether that Court has jurisdiction to make orders under s 106 of the Industrial Relations Act 1996 (NSW) in the absence of the company as a party. 3 I am satisfied on the evidence before me this morning that the plaintiffs are persons aggrieved, and that it is appropriate to make an order for the company to be reinstated. 4 A question arises as to the effect of the reinstatement of the company. The issue which arises is whether the former liquidators of the company remain as liquidators of the company upon reinstatement. There is a divergence of views as to whether this is in truth the effect of making such an order. 5 Mr Fernon SC, who appears this morning for the plaintiffs, has referred me to a line of authorities which reveals the dispute. I do not intend to record what was said in those authorities, but the cases and relevant paragraphs are: Australian Competition and Consumer Commission v Australian Securities and Investments Commission [2000] NSWSC 316 ; (2000) 174 ALR 688 at [50] ; Ramantanis v G and M Excavations; v I and M Excavations [2003] NSWSC 1250 at [7] to [8]; Murray Halstead v CTS Quality Building Products Pty Ltd (in liq) [2006] NSWSC 1022 at [12] ; JP Morgan Portfolio Services Limited v Deloitte Touche Tohmatsu [2008] FCA 433 ; (2008) 65 ACSR 636 at [7] -[8], and [10]. With the exception of the decision of Austin J in ACCC v ASIC , these authorities support the proposition that on registration of a company, the liquidator who was in office at the time of deregistration is not automatically reinstated. 6 However, in Best v Yellow Express Carriers Limited [2004] NSWSC 666 , Young CJ in Eq took a practical view to the question. His Honour took the view that in circumstances where the previous liquidator was served with the relevant papers relating to the application for reinstatement, and did not reply, it was open to the court to infer that the liquidator had no further interest in the matter. His Honour proceeded at [6] to observe that the company needed to have a liquidator and, in his view, the expedient and practical course was to remove the previous liquidator and to appoint another liquidator in accordance with the provisions of s 503 of the Corporations Act . 7 I have evidence before me today that indicates that the previous liquidators were served with notice of the application, but initially indicated no interest in continuing in office as liquidators of the company. However, there was then further communication with the previous liquidators which appeared to indicate a possible change of heart. However, on 22 May 2008, the plaintiffs' solicitors wrote to the solicitors for the previous liquidators requesting answers to a number of questions which would bear upon the issue of whether it was appropriate for the previous liquidators to continue in office upon reinstatement of the company. There has been no response to that letter. 8 It follows, in my view, that the appropriate course is not to seek to express any view as to the difference of opinion which has emerged in the cases to which I have referred, but, rather, to follow the expedient and practical course endorsed by Young CJ in Eq. 9 The principle to be applied in applications such as this was succinctly stated by Santow J in Advance Housing Pty Ltd (in liq) v Newcastle Classic Developments Pty Ltd (1994) 14 ACSR 230 at 234. His Honour observed that the correct balance is struck by permitting a liquidator to act as such even if there be a prior involvement with the company in liquidation, provided that involvement is not likely to impede or inhibit the liquidator from acting impartially. His Honour said that, in short, the question should be whether there would be a reasonable apprehension by any creditor of lack of impartiality on the liquidator's part in the circumstances by reason of prior association with the company or those associated with it, including creditors or, indeed, any other circumstance. 10 I do not need to determine whether it is necessary to strike such a balance or how that balance ought to be struck in the present case. There is, I think, insufficient evidence before me to suggest that there may be any lack of impartiality on the liquidator's part, but the fact which, points toward the course that I have indicated is the failure of the previous liquidators to respond to the letter of 22 May 2008. There can be no suggestion of any want of impartiality, but the failure of the previous liquidators to respond to the letter or to appear before me this morning, I think, impels the adoption of the course proposed by Young J. 11 I have been provided with short minutes of order which provide for reinstatement and for the removal of the previous liquidators with a new liquidator, Mr Steven Wesley Hathaway, to be appointed as liquidator of the company. I have in evidence before me a letter from ASIC dated 13 June 2008. The letter states that ASIC will not oppose the application for reinstatement of the company, provided five stipulated conditions are satisfied. There is no difficulty with any of these conditions, but it is necessary to add to the draft orders that were submitted to me this morning by Mr Fernon an order that the plaintiffs pay ASIC's costs of $434, and I will so order. 12 I should add that condition 5 referred to in ASIC's letter requires that the liquidator notify ASIC upon conclusion of the winding up. I will therefore direct the liquidator to so notify ASIC. 13 I will make orders in terms of [1] to [7] of the short minutes of order handed to me this morning by counsel, which I will initial and date. As I have said, I also order that the plaintiffs pay ASIC's costs of $434, and direct that the liquidator be directed to notify ASIC upon conclusion of the winding up. I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jacobson. | application for reinstatement of company whether the former liquidators of the company remain as liquidators upon company's reinstatement practical approach needed due to evidence of former liquidators having no further interest in the matter company reinstated new liquidators appointed corporations |
The appellant was born in Bangladesh in 1968. He claims to have a well-founded fear of persecution due to his political affiliation with the Awami League and active participation in anti-government politics in Bangladesh from 1985. In his original application for a protection visa, the appellant stated that he obtained a Bachelor of Commerce degree in 1989 in Chittagong and then became self-employed as Director of Chittagong Vegetable Oil Industries Limited. He claimed that after the Bangladesh National Party (BNP) won government in 1991, it commenced a campaign of persecution against Awami League activists. The appellant alleged party thugs attacked his place of business on 15 August 1994 and caused his workers to commence a strike. He also stated that on 15 June 1995, a false case was filed against him by the BNP and he had to go into hiding to escape persecution, including physical torture. The appellant claimed that after the Awami League won power in 1996, he was proved not guilty of the charges laid against him. The application also states that the appellant was seriously injured in 1999 during clashes in Chittagong organised by BNP supporters. The appellant alleged that when the BNP was returned to power in 2001, it again began to target members of the Awami League. The appellant stated that he was arrested on 12 November 2001 for organizing a demonstration against the government. He claimed that the police filed a false case against him involving charges relating to the possession of explosives and unlawful assembly, and took him into custody where he was assaulted physically and mentally. The appellant stated that before arriving in Australia, he travelled to Nepal and India on business in April 2002 and visited Thailand on the way to Australia in June 2002. He arrived in Australia on 18 June 2002 as a business visitor, and carried a Bangladeshi passport issued in his own name. The appellant applied for a protection visa on 15 July 2002 and this application was refused by the Minister's delegate on 24 October 2002. The Tribunal received an application for review of the delegate's decision on 23 November 2002, and the matter was heard by the Tribunal on 11 September 2003. Further submissions were made by the appellant on 13 October 2003. On 17 December 2003, the Tribunal notified the appellant of its decision affirming the decision of the Minister's delegate not to grant a protection visa. The Tribunal found that although the appellant was a supporter of the Awami League, he was not so politically prominent that he would have been vulnerable to persecution for political reasons during his time in Bangladesh. Nor did the Tribunal accept that the appellant would be vulnerable to persecution in the foreseeable future. In particular, the Tribunal said that it did not accept as plausible the appellant's claims to have been targeted by BNP thugs in August 1994, subjected to false charges in 1995 or injured in a clash with BNP activists in 1999. Nor did the Tribunal accept that the appellant went into hiding in February 2002 to escape political harassment. The Tribunal accepted that it was plausible that the appellant may have been charged with possessing explosives and unlawful assembly in November 2001, but decided that it was unlikely that the police would proceed with the charges if the appellant were returned to Bangladesh. On 21 January 2004, the appellant filed an application in the Federal Magistrates Court and later filed an amended application on 11 August 2004. This application for review was dismissed by Federal Magistrate Smith on 13 February 2006. The Federal Magistrate found that the reasoning of the Tribunal was open to it on the evidence, and that the Tribunal had identified and addressed all the claims made by the appellant. The learned Magistrate noted that the contentions put forward by the appellant did not justify a finding of jurisdictional error, and that the Tribunal's decision was therefore a privative clause decision from which relief is barred according to s 474(1) of the Act. Following the Federal Magistrate's decision, the appellant filed a Notice of Appeal on 3 March 2006. When the matter came before me for hearing, the appellant was asked what he wanted to say about the decision of the Federal Magistrate. The appellant articulated several claims. He referred to s 424A of the Migration Act 1958 (Cth) and stated that he had been disadvantaged and unable to present his case at the Tribunal hearing because he was ill and distressed. He also said that the Tribunal made an unfavourable decision on a number of factual matters. In response to submissions on behalf of the Minister, the appellant repeated some of these claims and said he would like an opportunity to obtain further documentary support. In relation to the last issue, I consider that the appellant has had ample time within which to obtain verification and this is not a ground for adjourning the matter. In so far as he makes submissions concerning the correctness of the Tribunal's decision on the merits, those are not matters for this Court unless it can be demonstrated that some error of law or principle affected the Tribunal's process of reasoning in reaching its conclusions. In this case, no error of law has been pointed to in either of the decisions below. The appellant's alleged ill health and distress before the Tribunal was considered by the Tribunal at par [42]-[43] of its reasons. At par [43], the Tribunal stated that it would not accept the claim of post-traumatic stress because no evidence had been provided by the appellant in support of this claim. The Tribunal also noted that this claim had not been raised in the material provided by the appellant or his advisor in the original application for a protection visa. The s 424A point is raised for the first time on the appeal before me. However, as it allegedly goes to jurisdiction, I shall deal with it. Rather, the section requires the RRT to provide the applicant with 'particulars of any information' that the RRT considers would form part of its reason for refusing the application for review, to explain to the applicant why that information is relevant to the review and to invite a response to it. In the present case, it is clear from pars [37] and [43] of its reasons that the Tribunal relied on the appellant's statements in his original application in relation to his previous travels, and noted his failure to make a claim in that application that he had to travel covertly. This material was used to reach an adverse conclusion as to his credibility. In the light of Al Shamry and SAAP , it is arguable for the appellant that there was a breach of s 424A(1) because it was not disclosed to the appellant that the material in his protection visa application would be so used to make an adverse finding against him. As a consequence, the appellant was given no opportunity to respond to any perceived inconsistencies. In relation to this issue, counsel for the Minister made two submissions. Firstly, counsel argued that the reference to "information" in s 424A does not encompass a failure to mention a matter to the Tribunal, and therefore Al Shamry does not apply. As the failure to mention a matter in a protection visa is not knowledge of facts or circumstances communicated to or received by the Tribunal, such a failure can not be said to be information within the context of s 424A and therefore does not have to be disclosed. However, in the present case, there is no doubt that matters raised in the original application were used by the Tribunal to suggest recent invention by the appellant. The manner in which the Tribunal used this information seems to go beyond relying upon the appellant's failure to raise certain matters. Several references are made in the reasons of the Tribunal to the use of affirmative information in the application as opposed to mere omissions in the sequence of facts initially presented by the appellant. At par [37] of the Tribunal's decision, for example, it says that the appellant stated in his original application that he travelled to Nepal and India on business. The Tribunal found this information to be contradictory to the appellant's later claims that he had to travel covertly due to persecution. In my view, this amounts to a positive use of information, as opposed to an observation made in relation to a failure to give information or make a claim. The second question that arose during the hearing is whether the appellant in fact republished the information in the original application that is relied on by the Tribunal in its reasons. If the information was republished by the appellant, it falls within what s 424A(3) identifies as information the appellant "gave for the purpose" of the application for review, and therefore the requirements set out in s 424A(1) do not apply: see, for example, Rares J's discussion in SZGGT v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCA 435. This issue was also raised by Weinberg J in SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCAFC 2. At [175] - [180] , his Honour considered the meaning and significance of the expression "information", and in substance accepted that s 424A(1) required the Courts to draw a distinction between information put forward by an applicant during an initial interview for a visa application and information concerning the same claims given later during a hearing. Although Weinberg J expresses the view that the section draws a somewhat unsatisfactory distinction between, for example, a failure to mention something during an airport statement and the making of an inconsistent statement during later evidence given at a hearing, the discussion of his Honour does indicate that if an applicant repeats an earlier statement at some stage during the course of a hearing, adopts it as true and then subsequently resiles from the statement, the Tribunal is not obliged to afford the applicant an opportunity to comment on the discrepancy: see also Bennett J's discussion of this issue in SZEFM v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCA 78. In the present case, I consider that the appellant has adopted the information contained in his original application for a protection visa. This is evident from the application to the Tribunal for review of the delegate's decision, which was prepared with the assistance of the appellant's advisor. This application is dated 23 November 2002 and appears at pp 76 --- 86 of the Appeal Book. As noted by the Federal Magistrate, the body of the application did not give more supporting material and assumed that the Tribunal would be receiving and considering all the documents which were before the delegate. It has not been demonstrated that there exists any error of law or principle in either the decision of the learned Magistrate or that of the Tribunal. Accordingly, the appeal is dismissed with costs. | application for protection visa refused whether tribunal complied with s 424a whether tribunal relied on positive statements or mere omissions in information given by appellant in original application whether appellant republished information given in original application appeal dismissed with costs migration |
The application was listed for final hearing and determination on the footing that the parties have reached agreement as to the facts giving rise to contraventions of s 16 of the Spam Act and, subject to discretionary considerations, the parties are agreed as to the formulation of the proposed declarations and injunctions to be made. In addition, the parties have reached agreement as to the pecuniary penalty they jointly submit the Court ought to order having regard to all of the statutory considerations going to that question. Those matters are supported by extensive written joint submissions filed by the parties and supplementary written submissions in relation to additional matters to be mentioned later in these reasons. Mr Atkinson admits the contraventions alleged against him, based on the agreed facts. The joint submissions go beyond simply questions of fact and extend to joint submissions as to matters relevant to the exercise of the power to impose a pecuniary penalty. Between approximately 25 October 2006 and 17 December 2007, Mr Atkinson operated a business, under the name "Sancash", which promoted various herbal products, adult products, and replica watches (the Sancash products ), by means of unsolicited email messages (the spam emails ) sent by a series of approximately 45 recruited individuals (the Sancash affiliates ). If a recipient purchased a Sancash product as a result of the spam emails sent by a Sancash affiliate, Mr Atkinson received a commission payment from the supplier of the product, and in turn paid a commission to the Sancash affiliate. A spam email sent by a Sancash affiliate would contain an internet link through which the recipient of the spam email could order a promoted product. Sancash affiliates were allocated their own specific internet links to include in the spam emails that they sent. This enabled a Sancash affiliate to be identified in relation to a particular purchase and for a commission to be paid. The operation of the Sancash business between October 2006 and December 2007 involved the sending of millions of spam emails worldwide by Sancash affiliates. Mr Atkinson did not personally send the spam emails. Subject lines that Mr Atkinson caused to be created and provided, by a subordinate, include the subject lines in Attachment 2 to these submissions. The spam emails did not fall within the exception in s.16(1)(b) of the Spam Act for "designated commercial messages", as defined in Schedule 1 of the Spam Act , as they contained content other than factual information, being a promotional message in relation to the Sancash products. The spam emails were sent to persons including recipients in Australia, and included messages accessed using computers, servers or devices located in Australia, and messages sent to electronic account-holders who were individuals physically present in Australia when the emails were accessed. Such emails had an Australian link within the meaning of that expression in s.7 of the Spam Act . This proceeding is confined to the conduct of Mr Atkinson in causing to be sent those spam emails which had an Australian link (the Australian spam emails ). Mr Atkinson says that he requested some new affiliates not to send the email messages to some Australian email addresses. Mr Atkinson did not retain any records of such communications and the records produced by him or otherwise obtained by the ACMA do not contain any of these statements. The precise terms of Mr Atkinson's requests accordingly cannot be specified. Mr Atkinson admits that he gave no instruction or direction that would be capable of ensuring no Australian address received the spam emails and he in fact observed that orders were received from Australian customers. Mr Atkinson also did not take effective steps to check whether such instructions as may have been given about Australian addresses were complied with. He also suspected, but did not check, that at least one of the affiliates was based in Australia. Attachment 3 to these submissions is a CD of emails identified by the applicant as Australian spam emails sent by the Sancash affiliates, and caused to be sent by Mr Atkinson, during the period between 18 October 2007 and 17 December 2007. The emails are extracted from a database maintained by the applicant, referred to as the "SpamMatters database", through which members of the public in Australia are able to report, and forward to the ACMA, unsolicited commercial emails received at their email accounts. The extracted emails contained in Attachment 3 comprise those from the ACMA's SpamMatters database which incorporated one of the domain names identified at Attachment 1 as created by the respondent. There are 140,789 emails extracted in the attached disk. The pleaded conduct occurred up to the time of that intervention. The ACMA alleges, and Mr Atkinson admits, that by engaging in the conduct pleaded in the statement of claim, between approximately 25 October 2006 and 17 December 2007, he caused to be sent unsolicited commercial electronic messages, which had an Australian link, in contravention of s.16(1) of the Spam Act . It can be seen from the agreed facts that between 25 October 2006 and 17 December 2007 Mr Atkinson operated a business called "Sancash" which promoted the sale of herbal products, adult products and replica watches by means of unsolicited email messages sent by approximately 45 recruited individuals who were paid a commission by Mr Atkinson. The joint submission also adopts the statement of claim in the proceeding filed on 21 October 2009 that describes the products as herbal products promoted or supplied by Genbucks Limited, adult sex toys supplied or promoted by Genbucks Limited and watches branded "King Replica". The spam emails sent by Sancash affiliates contained an internet link to a website from which a product could be purchased. The operation of the Sancash business between the relevant dates involved the sending of millions of spam emails worldwide by Sancash affiliates. Mr Atkinson caused the emails to be sent. As the emails were sent for the purpose of offering to supply or promote Sancash products, they were "commercial electronic messages" within the meaning of that term in s 6 of the Spam Act and they did not fall within the exception in s 16(1)(b) of the Spam Act . The spam emails were sent to recipients in Australia using computers, servers or devices located in Australia and thus the conduct of Mr Atkinson had, at all relevant times, what is described as an "Australian link" for the purposes of s 7 of the Spam Act . The period of the contravening conduct was almost 14 months in all. As the agreed facts make clear, millions of spam emails were sent by Sancash affiliates "worldwide" although these proceedings are confined to the conduct of Mr Atkinson in causing unsolicited commercial electronic messages to be sent which had an Australian link. The parties agree that over a period of 61 days, 140,789 emails that were caused to be sent by Mr Atkinson were formally reported to the Authority by members of the public in Australia. The emails incorporated as points of supply one of the many domain names identified at Attachment 1 to the joint submissions. Attachment 1 consists of a 10-page document comprising five columns of domain names. There are approximately 2,090 domain names recited in Attachment 1. Mr Atkinson accepts that the 140,789 emails are likely to represent only a small proportion of the total number of Australian spam emails with an Australian link actually sent by the Sancash affiliates and which Mr Atkinson caused to be sent (para 20 of the agreed submissions). At para 12.3 of the agreed submissions, Mr Atkinson accepts that an element of causing the emails to be sent involved his conduct in causing to be created and provided, particular subject lines called "ManSter/VPXL Subject Lines", for use in spam emails so as to attempt to prevent automatic spam filters detecting and deflecting unsolicited commercial electronic messages. Accordingly, it is common ground that all of the integers of s 16 are made out and Mr Atkinson has sent or caused to be sent a commercial electronic message that has an Australian link and is not a designated commercial electronic message for the purposes of the Spam Act . For a person who is an individual and who has not been previously found to have contravened the Spam Act , the maximum penalty prescribed by s 25(4) is 20 penalty units in respect of a contravention of s 16(1) ; or if the Federal Court finds that the person has, on a particular day, committed two or more contraventions of s 16(1) , the total penalties payable under s 24(1) by the person in respect of those contraventions must not exceed 400 penalty units. A penalty unit is defined in s 4 of the Spam Act as having the meaning given by s 4AA of the Crimes Act 1914 (Cth) which provides that a penalty unit is $110.00. Accordingly, the maximum applicable penalty for each of the 61 days on which more than one contravention is admitted and found by the Court to have occurred, is $44,000.00. The maximum penalty in respect of the contraventions admitted over the 61 days set out in the schedule at para 19 of the joint submission quoted at [5], is $2,684,000.00. By para 35 of the joint submission, the parties contend that on the basis of the principles, factors and circumstances set out in the submission, it is appropriate that the Court impose upon Mr Atkinson in respect of the contraventions across the period of the 61 days, a single pecuniary penalty in an amount of $210,000.00. This represents a pecuniary penalty of 7.82% of the maximum penalty prescribed by s 25 of the Spam Act . As to the five criteria identified in s 24 of the Spam Act , the parties jointly make these submissions. First, the Sancash spamming activity caused by Mr Atkinson was " deliberate , extensive , and occurred over a lengthy period" [emphasis added]. The parties agree that in view of the admissions made by Mr Atkinson as to the conduct, the authority does not seek to adduce evidence as to the likely numbers of spam emails with an Australian link that Mr Atkinson caused to be sent over the full period of the contraventions, namely, 14 months. However, the parties jointly submit that it is a relevant consideration that the contravening conduct occurred over a significantly longer period than the 61 day period in relation to which a selection of detailed email records is provided. It should be noted that those emails contained in the attachment to these submissions comprise only those reported to the ACMA by members of the public. That this sample represents such a significant number of emails reported per day indicates that the extent of the conduct and volume of emails was very high . Although the nature and extent of any loss caused by the sending of the unsolicited commercial electronic messages is not quantifiable, the parties jointly submit that the Court should have regard to the Explanatory Memorandum (the "EM") circulated by the Minister for Communications, Information Technology and the Arts, Senator Alston, upon the introduction of the Spam Bill 2003 to the House of Representatives, addressing the international problem affecting the efficient operation of internet telecommunications networks by reason of spam emails and the costs imposed on end-users. A recent study from Ferris Research estimates that US companies alone lost US$8.9 billion (A$15.2bn) in 2002 and estimate that the cost of spam in Europe was US$2.5 billion (A$4.3bn). According to figures from Star Internet, a large Internet service provider in the UK, the cost to business in lost productivity is estimated at £326 (A$915) per employee each year. Surfcontrol recently estimated that spam cost employers approximately $1 per spam received. Erado's 2002 white paper on spam, viruses and other unwanted content estimates that annual cost of spam per employee is around US$1000 (A$1709). Spammers themselves, on the other hand, bear relatively small costs in sending these messages. E-mail costs do not scale like sending surface mail or making telephone calls - the cost of sending out a million e-mails is not significantly more than the cost of sending out a hundred. As to s 24(2)(d) , Mr Atkinson has not previously been found by the Court in proceedings under the Spam Act to have engaged in any conduct similar to a contravention of s 16(1). Section 24(2)(e) addresses the question of whether Mr Atkinson has previously been found by a Court in a foreign country to have engaged in any similar conduct. Mr Atkinson cooperated with New Zealand authorities to resolve those proceedings, and paid a pecuniary penalty in the amount of NZ$100,000 in respect of contravening emails sent to recipients in New Zealand. 08CV5666. Default judgment has now been handed down in the United States proceedings, in the matter of Federal Trade Commission v Atkinson & Ors , United States District Court for the Northern District of Illinois, Eastern Division, Case No. 08CV5666. An amount of US$15,151,029 was imposed jointly and severally upon Mr Atkinson and Inet Venture Pty Ltd, as equitable monetary relief for violations of the Federal Trade Commission Act ( FTC Act ) and the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 ( CAN-SPAM Act ). As the penalties sought in the present proceedings are in respect only of such emails as are connected with Australia, the parties submit a penalty in the amount proposed remains appropriate. On 4 November 2009, default judgment in the United States case was entered against five of the six defendants in the proceeding, including Mr Atkinson. The proceeding, commenced by the Federal Trade Commission ("FTC"), alleged a range of contraventions of the Federal Trade Commission Act (the "FTC Act"), concerning contended deceptive practices in connection with the sale of certain purported herbal products and a pharmaceutical medication, some of which involved representations as to sexual enhancement. There seems to be some correlation between the products in issue and those the subject of these proceedings. In addition, the proceedings involved contended contraventions of the United States Controlling the Assault of Non-Solicited Pornography and Marketing Act 2003 (the "CAN-SPAM Act"). Various provisions of the CAN-SPAM Act were relied upon by the FTC in the proceedings. The essential contention was that Mr Atkinson and others had initiated the transmission of unsolicited computer email messages in contravention of the Act in respect of the sale and promotion of the above products. The relevance and utility of the United States proceedings is simply that the Court should note that Mr Atkinson has been the subject of proceedings in the United States which in some respects bear similarities to the present proceedings. The United States proceedings will not fall within the scope of s 24(2)(e) simply on the footing that prior to the determination of a pecuniary penalty, a court in a foreign jurisdiction has made findings concerning the conduct of Mr Atkinson which, as to the distribution of electronic messages, bears some similarities with the conduct in these proceedings. It seems to me that on the question of penalty, s 24(2)(e) is directing the Court to take into account conduct on the part of Mr Atkinson, the subject of findings by a foreign court in respect of similar conduct to the conduct the subject of these proceedings, which occurred prior to the contraventions of the Spam Act . It is true that the United States proceedings do not represent a foreign proceeding in which findings were made adverse to Mr Atkinson prior to the contraventions alleged in these proceedings between 25 October 2006 and 17 December 2007. It is not clear from the judgment precisely when the conduct in respect of the United States distribution of electronic messages occurred. Further, the proceedings involved contraventions of both the CAN-SPAM Act and the FTC Act. In addition, the findings arose out of an application for judgment in default of appearance on all counts after service of the proceedings on all defendants. The parties made joint submissions as to the deliberateness of the contraventions of the Spam Act and the period over which it extended. Mr Atkinson profited directly from the contravening conduct, and engaged in it for the [purpose] of obtaining those profits. Paragraphs 59 and 60 are in these terms: Mr Atkinson has co-operated with the ACMA in jointly seeking resolution of these proceedings. Mr Atkinson made substantive admissions to the ACMA at a relatively early stage of the investigation, obviating the need for time-consuming and costly evidence-gathering and forensic investigation on the part of the regulator. While admissions were initially made in the course of compulsory examination, rather than on a voluntary basis, Mr Atkinson proceeded in a co-operative manner following the examination, and provided documents and information to the ACMA on a voluntary basis. Mr Atkinson's consent to the proposed orders, and admissions in the proceedings, will also assist in minimising the impact of the proceeding on the resources of the Court. As to the totality principle, the parties jointly submit that the conduct represents one class of conduct comprising a sequence of contraventions all of the same kind or character, and thus, it is appropriate to aggregate the contraventions and treat them as a single contravention made up of many parts notwithstanding that many unsolicited commercial electronic messages were caused to be sent by Mr Atkinson on each of the 61 days within a pattern of conduct over a 14 month period. There have now been three judgments of the Court in respect of contraventions of s 16 (among other provisions) of the Spam Act . They are, Australian Communications and Media Authority v Clarity1 Pty Ltd [2006] FCA 1399; (2006) 155 FCR 377 per Nicholson J; Australian Communications and Media Authority v Mobilegate Ltd A Company Incorporated in Hong Kong (No 4) [2009] FCA 1225 ; (2009) 261 ALR 326 per Logan J; and a further ex tempore judgment by Logan J on 16 December 2009 concerning further respondents in the Mobilegate litigation ( Australian Communications and Media Authority v Mobilegate Ltd (No 6) [2009] FCA 1533). The decision of Nicholson J in Clarity1 , involved conduct on the part of the corporation of sending 270,305,474 commercial electronic messages between 10 April 2004 and 13 April 2006. In the majority of these contraventions, Clarity1 had used harvested addresses in contravention of s 22(1) of the Spam Act . Mr Mansfield, the second respondent, was found to have aided, abetted, counselled and procured the contraventions and to have been knowingly concerned in or a party to them. The Court found Mr Mansfield to have been "closely involved" in the contraventions. The proceedings were contested. Nicholson J made findings of fact in a primary judgment and addressed the question of the pecuniary penalty in the judgment cited above. Nicholson J took these matters into account: it was difficult to quantify the loss or damage caused by the conduct and thus the presence of loss or damage was treated as a possible aggravating circumstance; the contraventions involved a "huge volume" of electronic messages described by witnesses as "annoying, time consuming and frustrating" resulting in responses through filtering and blocking software; since the contravening conduct was the first conduct to be prosecuted under the Spam Act and the respondents genuinely believed that their conduct did not involve a contravention, these circumstances amounted to "an important factor in their favour"; the respondents had not been found by the Court to have engaged in previous contraventions; although the conduct of the respondents was deliberate, the deliberateness was an expression of their belief that their understanding of the new law was correct; and, the issue of capacity to pay a pecuniary penalty, although a relevant factor, was of less relevance when balanced against the necessity of imposing a penalty meeting the objective of general deterrence. His Honour applied the totality principle. On the question of cooperation, the applicant acknowledged that the respondents had not attempted to hinder or prevent it from conducting its investigation of the respondent's conduct. The applicant contended that cooperation flowed from the fact that at no time did the respondents entertain the possibility that their conduct might contravene the Spam Act . The respondents vigorously opposed the position asserted by the applicant that they had not shown any cooperation in relevant respects. Nevertheless, one point of distinction between Clarity1 and the present proceeding is that the respondents in Clarity1 contested the proceedings because they believed their conduct did not involve a contravention of the Act. Thus, they simply sought to ventilate their view of the quality of their conduct in the face of new legislative provisions. In these proceedings, Mr Atkinson, in the face of enforcement proceedings, exhibited genuine cooperation with the Authority. In approaching the assessment of the pecuniary penalty, Nicholson J considered that there is a need for "commercial realism in fixing penalties". He also said this: One difficulty which emerges in the application of the pecuniary penalty provisions in the new Act is that the maximum penalties are so high as to give rise to "an unrealistically large penalty". The unrealistic character derives principally from the quantum of penalty viewed in relation to the capacity of either respondent to pay and the need for general as well as specific deterrence. It is not just the total quantum of a pecuniary penalty which can provide the element of general deterrence. That quality derives from a consideration of the penalty in relation to the conduct giving rise to it and the financial capacity of the offenders. Where the financial capacity is not great, a [lesser] pecuniary penalty in value will derive its quality of general deterrence from its magnitude in relation to that capacity. [As to a penalty of $9.9m sought against Clarity1 ] A penalty in the amount of $9.9 million is clearly one beyond the capacity of Clarity1 to pay and so likely to lead to its liquidation. It is quite disproportionate to the commercial realities of Clarity1 . Even as proposed it is in the particular circumstances "an unrealistically large penalty". ... It is overly weighted in favour of general deterrence. Importantly, it does not appear to be constructed on any allowance of the new character of the legislation and the entitlement of the respondents to test their view of the effect of the legislation. Similar views were expressed in relation to the pecuniary penalty sought against the individual, Mr Mansfield. In the end result a pecuniary penalty of $1m was imposed upon Mr Mansfield. The pecuniary penalties imposed in the matter amounted to approximately 5% of the maximum penalties possible. In Mobilegate , Logan J was addressing conduct involving the sending of unsolicited short-message-service messages to the mobile telephones of users who had been deceived into providing their mobile telephone numbers to representatives of either Mobilegate , the first respondent, or Winning Bid , the second respondent, under the belief that they were corresponding with individuals seeking to meet them and form relationships via dating web-sites. Logan J described the respondents as "predators on the emotionally vulnerable for reward" which was "a particularly vile form of behaviour". His Honour said the conduct was "duplicitous and exploitative" and "cruel and callous". His Honour concluded that this class of conduct warranted a "very substantial penalty". Among a number of considerations his Honour noted that the conduct was deliberate and covert and that penalties must be sufficiently significant to "deter the unscrupulous from taking a calculated business risk" but should not be so high as to be "oppressive" in the sense contemplated in Trade Practices Commission v Stihl ChainSaws (Aust) Pty Ltd [1978] FCA 104; (1978) ATPR 40-091. In addition, the evidence demonstrated that there was approximately $4m of financial loss on the part of individual mobile telephone users who were charged communications fees. His Honour found that the conduct was "of such an intimate exploitive nature that the exploiter by the very conduct gives itself, himself or herself, a degree of insulation at a practical level from suits for financial recovery" and the conduct involved a "consistent pattern of studied deception". It was deliberate contravening conduct with no mitigating circumstances. In addition, there was no evident cooperation in the administration of justice. The entity, Mobilegate , was ordered to pay $5m which represented 6.87% of a possible maximum of approximately $72,820,000. The entity Winning Bid was ordered to pay $3,500,000 representing 8.51% of a possible maximum of $41,140,000. So far as the individuals were concerned, Logan J took into account that their involvement was extensive, knowing and persistent. However, in examining the implications which might be drawn from statutory maximum pecuniary penalties in the context of individuals found to be parties to contravening corporate conduct, Logan J considered assessment of the maximum penalty as a "theoretical exercise". Significant pecuniary penalties were ordered against the individuals having regard to the quality of their engagement in the conduct of the corporation. There is little point isolating the amount of each penalty in respect of each individual in the circumstances of the findings. Clearly, it is important to take into account the scale of penalties the Parliament has selected as the appropriate range leading to a maximum penalty in respect of contraventions of particular legislation. Often, careful attention will need to be given to the Parliament's selection of maximum penalties as an expression of the Parliamentary intention that particular conduct, must be transparently deterred. This is entirely consistent with Markarian v The Queen (2005) 228 CLR 357. In addition, the Regulation Impact Statement at p 4 of the EM sets out the following statement of the problem sought to be addressed by the Spam Act at p 4. It is causing immense frustration and reduced productivity for users, businesses and government agencies. If left unchecked it will reach proportions which will threaten the viability of the internet as a reliable communications medium. A recent comprehensive review of the problem by the National Office for the Information Economy recommended a multi-layered approach to addressing the problem, including the implementation of specific anti-spam legislation. At p 5, the EM notes, "There are clear signs of a deleterious impact on the performance of the global e-mail network with some commentators predicting that the continuing proliferation of spam could mean the end of e-mail as an effective form of communication". This has been included to ensure that a meaningful penalty may be charged for a single contravention without causing an unrealistically large penalty payable for multiple contraventions. For example, there are reported cases of dedicated spammers sending millions of unsolicited commercial electronic messages each day. Without a ceiling amount for daily contraventions, such a spammer could potentially be liable for a million contraventions. The ratio between the penalty payable for a person for single contravention and the ceiling amount is 20 times. Firstly , I have taken into account each of the considerations identified in s 24(2) of the Spam Act in determining whether the proposed pecuniary penalty is appropriate. That question is to be approached by taking into account all of the relevant considerations including the criteria at s 24(2)(a) to (e) and any additional matters that enable the Court to determine whether the proposed penalty is within the range of penalties that might be imposed. Secondly , I consider that the decisions of the Court in Clarity1 and Mobilegate engage factors which significantly differentiate those cases from the present case. Clarity1 was a fully contested proceeding involving a different class and scale of conduct. There was no cooperation in relation to the proceeding because the respondents took the view that their conduct did not involve a contravention of the relevant provisions especially in circumstances where the legislation had not been tested and no judicial determination was before the respondents which may have aided their analysis of the various integers contained in the sections. The respondents in Clarity1 cooperated in the conduct of the case but not in the sense of accepting the contention that its conduct contravened the Spam Act , so as to avoid the applicant incurring the costs of the proceeding. The decision in Mobilegate involved truly reprehensible predatory conduct of a kind which warranted a penalty directed emphatically towards specific deterrence and transparent general deterrence. The class of conduct the subject of Mobilegate is not evident in these proceedings. Thirdly , however, as to the class of conduct on the part of Mr Atkinson, there is simply no doubt that Australian citizens find large-scale distribution of unsolicited commercial electronic messages promoting the sale of products, in the circumstances of this case, very irritating and annoying. It causes all users of computers to constantly update spam filters and other protective devices to try to deflect the unwanted rain of electrons and digits disseminated by those who wish to do what Mr Atkinson has done. The Parliament has made its intention plain that the unsolicited distribution of electronic emails (spam) is to be discouraged. Notwithstanding these considerations, the Court ought to take into account and attach significant weight to Mr Atkinson's cooperation with the Authority in isolating the extent of the conduct and in seeking to resolve the present claims on the basis of admissions and a joint submission. Fourthly , Mr Atkinson is represented by independent lawyers and he has formed his view as to the various matters the subject of the submission with the assistance of that advice. Fifthly , from the regulator's perspective, there is much to be gained, in the public interest, in reaching the consensus reflected in the joint submission which, in truth, is a calculus of competing considerations which take their distilled form in the joint submission as a result of a range of considerations and, no doubt, positions put; some accepted; some rejected; and many negotiated, with a view to addressing the contraventions without the necessity of litigation. Plainly enough, significant costs will be avoided for the Authority as a result of this approach to the matter. Court time will be saved and matters of other litigants will be allocated to Court time that would have been consumed in hearing the present proceeding. Sixthly , although Mr Atkinson has been the subject of New Zealand proceedings, I note that he also cooperated with the New Zealand authorities in resolving the matters in issue in that jurisdiction. I note that Mr Atkinson contends in the joint submissions that he made some attempts to prevent the distribution of the emails to Australian addressees although the attempts are undocumented and undefined. Nevertheless, I accept that some attempt was made to prevent that distribution. Seventhly , in assessing whether the quantum of the proposed penalty is appropriate in all the circumstances, I have taken into account the agreed position concerning the facts of the contraventions; the unquantifiable but recognised costs and losses imposed on users by conduct such as Mr Atkinson's conduct; the highly deliberate character of the conduct engaged in for profit-making by Mr Atkinson; the attempts by Mr Atkinson to counteract filters used to prevent spam communications from reaching Australian users; and the other considerations earlier mentioned. Eighthly , although the pecuniary penalty is a matter for the Court to determine ( Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72), and the question of whether the Court ought to make declarations as to particular matters or injunctions framed in a particular way or at all necessarily involves discretionary considerations and questions of utility, the Court will attach significant weight to a negotiated settlement quickly reached between parties acting with the benefit of legal advice, provided the document identifies the conduct precisely; the responsibility of each respondent in that conduct is recognised (whether at the centre or at the margin); and the proposed penalty is within the range the Court would impose and is thus not manifestly inadequate: Trade Practices Commission v TNT Australia Pty Ltd (1995) ATPR 41-375; NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285; Australian Communications and Media Authority v Radio 2UE Sydney Pty Ltd (No 2) (2009) 178 FCR 199. The approach to the assessment of a pecuniary penalty under the Spam Act ought, in principle, to reflect some of the considerations applied by the Court in assessing a pecuniary penalty under the Trade Practices Act 1974 (Cth). In particular, the Court will have regard to the elements of specific and general deterrence and assess whether a proposed penalty might be so high as to be oppressive in all the circumstances: Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (No 3) (2005) 215 ALR 301; TPC v Stihl Chainsaws (Aust) Pty Limited ; NW Frozen Foods Pty Ltd v ACCC at 293. I am satisfied that the proposed pecuniary penalty is within the range that the Court would impose, although I take the view that the proposed penalty in the joint submission is towards the lower end of that range having regard to the concessions made on the facts and the criteria informing the determination of a penalty. However, Mr Atkinson's cooperation is a significant factor in determining whether the penalty is within the range and thus not manifestly inadequate. The proposed penalty of $210,000.00 is one which will impose specific deterrence upon Mr Atkinson and suggests to the broader community, as a matter of general deterrence, that contravention of the Spam Act attracts significant penalties. In addition, the public recognition that early and close cooperation with the Authority, when confronted with conduct in contravention of the Spam Act , is likely to significantly mitigate the pecuniary penalty ultimately imposed, is in the public interest, by creating incentives for contraveners to cooperate early and comprehensively. Mr Atkinson is to be ordered to pay to the Commonwealth of Australia, in respect of his contraventions of the Spam Act , a pecuniary penalty in an amount of $210,000.00, such penalty to be paid within 60 days of this order. A further order will be made by agreement that the respondent pay the applicant's costs of and incidental to these proceedings in an agreed amount of $15,000.00 within 60 days of this order. I certify that the preceding fifty-two (52) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood. | consideration of a joint submission by the parties in relation to a contravention by the respondent of s 16 of the spam act 2003 (cth) consideration of the principles to be applied in assessing a pecuniary penalty in the context of joint submissions as to the proposed penalty consideration of the extent to which the principles governing assessment of a pecuniary penalty in the context of a joint submission derived from proceedings under the trade practices act 1974 (cth) might usefully apply in the assessment of a penalty under the spam act consideration of the formulation of a declaration as to contravention and the framing of an injunction restraining threatened future contraventions consideration of the particular vice the parliament of the commonwealth sought to address in enacting the spam act communications law |
On 23 July 2009 the Applicant filed an Amended Statement of Claim . The pleadings from the outset have sought to advance the case as a representative proceeding pursuant to Pt IVA of the Federal Court of Australia Act 1976 (Cth) ('the 1976 Act'). The allegations made by Pharm-a-Care have a lot in common with other proceedings filed in this Court by the applicants in related matters arising out of the same set of facts, being NSD 345/2009, NSD 358/2009 and SAD 130/2008. All Respondents in the present proceeding and in those other proceedings have filed Notices of Motion seeking various forms of relief, including orders pursuant to O 11 rr 16 and 20 or O 13 r 5 of the Federal Court Rules and s 31A of the 1976 Act. Those Motions were to be heard on 20 to 23 October 2009, but those dates had to be vacated when it was finally concluded that notices had to be served under s 78B of the Judiciary Act 1903 (Cth). Notwithstanding the fact that the hearing of the Motions had to be adjourned to a future date, there remained listed for hearing two Notices of Motion seeking to set aside a subpoena issued at the instance of the Second to Sixth Respondents. Each litigation funding agreement entered into by IMF (Australia) Limited as at 23 December 2008 referred to in paragraph 2(c) of the application filed on 23 December 2008, a copy of which is attached and marked "A". All documents which contain any list of persons or entities who have entered into the funding litigation agreements referred to in paragraph 1 above. But some attention needs to be given to those provisions which assume present relevance. Section 33A, a provision contained within Pt IVA, defines a " representative proceeding " as " a proceeding commenced under s 33C ". Section 33H deals with the content of the originating process whereby a representative proceeding is commenced. That form is framed by reference to s 33H(1)(a), (b) and (c): Bailey v Veda Advantage Information Services and Solutions Ltd [2007] FCA 1664 at [9] . Amongst the other requirements imposed by s 33H, s 33H(1)(a) requires the " group members " to be clearly identified: Auskay International Manufacturing and Trade Pty Ltd v Qantas Airways Ltd [2008] FCA 1458 at [27] , [2008] FCA 1458 ; 251 ALR 166 at 175 per Tracey J. One reason, as the High Court observed in Wong v Silkfield , is to enable the Court to determine whether the requirements of s 33C have been satisfied. Unless the group member is adequately described or identified (although not necessarily named or counted: s 33H(2)), it may be difficult to ascertain, for example, whether the claims of all the group members give rise to a substantial common issue of law or fact. If a person who is a group member does not opt out of the proceedings he or she will be bound by the judgment. (Section 33ZB requires the judgment in a representative proceeding to "describe or otherwise identify the group members who will be affected by it"and provides that the judgment binds any such persons other than any person who has opted out. ) The failure by a group member to opt out of representative proceedings may therefore be attended by serious consequences, although of course the litigation might also produce advantages for that group member. Persons contemplated as being within the group would themselves not understand whether they were within it, unless the definition of the group is intelligible, although not necessarily exact. Members of the group are entitled to know what constitutes the essentials of the group. A decision concerning opt-out cannot be sensibly made unless it is known what it is that is being opted out from. A useful, although not necessarily exhaustive test, is whether the description is such as to enable a person, with the assistance of a legal adviser if necessary, to ascertain whether he or she is a group member. If the description incorporates a reference to conduct alleged in the pleadings, a person or his or her adviser ought to be able, by reading the description and the relevant portion of the pleadings, to determine whether he or she is a member of the represented group. If a person cannot reasonably be expected to do this, the definition is unlikely to satisfy the requirements of s 33H(1)(a). In Johnstone v HIH Insurance Ltd [2004] FCA 190 at [52] Tamberlin J likewise said that "... it is necessary to know with some precision who the group members are ". Particular reliance is placed by Counsel on behalf of Pharm-a-Care and IMF (Australia) Limited upon the need for compliance with s 33H to be apparent " from the pleadings ". See also: Bright v Femcare Ltd [2002] FCAFC 243 at [126] , [2002] FCAFC 243 ; 195 ALR 574 at 600 per Kiefel J, with whom Lindgren and Finkelstein JJ agreed. These provisions, together with the other provisions contained within Pt IVA, may have to be considered in greater detail when the Motions are heard seeking either judgment pursuant to s 31A or relief under O 11 rr 16 and 20 or O 13 r 5. Whether the Respondents ultimately prevail in this regard must await determination at a future date. The present matter to be resolved is the fate of the subpoena served upon IMF (Australia) Limited. It was initially returnable on 3 June 2009, but was stood over to 20 October 2009 to coincide with the resolution of the Motions now before the Court. The Second to Sixth Respondents contend that their forensic purpose in issuing the subpoena was to obtain " a better understanding of the group members whom Pharm-a-care seeks to represent ". Notwithstanding the transformation in the manner in which Group Members have been identified over time, the relevance of the " litigation funding agreements " with IMF (Australia) Limited has remained a common feature. But those who may fall within the description of Group Members has, however, varied with each amendment or proposed amendment. Where a subpoena has not been sought for a legitimate forensic purpose it is said to be an " abuse of the processes of the court ". Such language serves to emphasise the fact that the compulsory processes of the Court are not to be invoked except for the purpose of the administration of justice in an individual case. The various grounds upon which an application may be made to have a subpoena set aside need not be presently canvassed in any great detail. In the present case, Pharm-a-Care and IMF (Australia) Limited initially sought orders setting aside the subpoena upon three grounds, namely: the documents are said to have no present relevance; the production of the documents sought is premature; and compliance with the subpoenas is said to be " oppressive ". The other grounds remain to be resolved. The Second to Sixth Respondents curiously contend at the outset that Pharm-a-Care does not have standing to seek to set aside the subpoena. The terms of O 27 r 4 of the Federal Court Rules should thus be noted. It is that rule which expressly confers the power to set aside a subpoena and identifies those who may apply for such an order. (2) An application under subrule (1) must be made on notice to the issuing party. (3) The Court may order that the applicant give notice of the application to any other party or to any other person having a sufficient interest. An application was there made by a non-party to have a subpoena set aside. What was not in issue was the interest a party had in setting aside a subpoena. Why r 4(1) and the express reference to " the application of a party " did not confer sufficient authority upon Pharma-a-Care was not sufficiently explained. A contention that the phrase " having a sufficient interest " qualifies both the reference to " any person " and " a party ", such that the Rule is read as referring to " a party ... having a sufficient interest ", is (with respect) unsustainable. That is not what the Rule says and such a construction of the Rule would render the reference to " a party " unnecessary. The reference to " any person having a sufficient interest ", upon such a construction, would identify the entirety of persons --- be they parties or non-parties --- that could apply. Mandic is no authority to the contrary. It should be noted that considerable care should be exercised in placing reliance upon judicial interpretation of any provision without regard to the terms in which a particular statutory or regulatory provision was then expressed. One decision thus relied upon was Fried v National Australia Bank Ltd [2000] FCA 911 , 175 ALR 194. At the time of that decision the power to set aside a subpoena was that conferred by O 27 r 9, which then provided that " [t]he Court may, of its own motion or on the motion of any person having a sufficient interest, set aside the subpoena wholly or in part ". That decision may remain of assistance only in interpreting the expression " any person having a sufficient interest " as it appears in the current r 4(1): it has nothing to say about the phrase " a party ". Moreover, and since the relief claimed by Pharm-a-Care and IMF (Australia) Limited is identical, and since both corporations were represented by the same Counsel, it appeared to matter little which was the entity that sought the relief. Such differences as may emerge in different proceedings where a subpoena is served upon a third party having no interest in a proceeding may in the present proceeding assume less relevance given the role played by funding agreements with IMF (Australia) Limited and the description of Group Members . Different solicitors, however, separately represented each of the applicants on the motions. There may have been some significance if an issue of costs needed resolution. The Second to Sixth Respondents did not dispute that IMF (Australia) Limited had a " sufficient interest " to apply to have the subpoena set aside. Rejected, however, is any contention that Pharm-a-Care does not have standing to seek to have the subpoena served upon IMF set aside. Also rejected --- at least in the general manner in which the submission was advanced --- is the further submission advanced on behalf of the Second to Sixth Respondents that "... some weight ought be given to the present process of the Court whereby a subpoena is only issued with leave of a judge of the Court ...". In this Court an order must be obtained if a subpoena is sought requiring a person to attend to give evidence or to produce a document: O 27 r 2. The very essence of a subpoena is that it is an order invoking the compulsory process of the Court : Jacomb v Australian Municipal Administrative Clerical and Services Union [2003] FCA 1143 at [7] per Heerey J. Quite frequently such orders are made by Judges in Chambers upon the basis solely of those documents which have initiated the proceeding and an affidavit together with a draft of the subpoena sought. The person upon whom the subpoena is to be served quite frequently (if not invariably) has no knowledge of the fact that a subpoena is being sought and is not given any opportunity to either oppose the order being made or the terms of the proposed subpoena. More often than not a subpoena is sought in respect to a person not a party to a proceeding. On its face, however, the discretion conferred by O 27 r 4(1) appears unconstrained --- other than by reference to the touchstone that a discretion must generally be exercised judicially and not arbitrarily. Why that discretion should be constrained by reference to some unidentified " weight " that should be given to the fact that an order has previously been made pursuant to O 27 r 2 was not explored at any great length. Obviously enough, if such an order had not been made, no occasion would arise for the exercise of the discretion conferred by O 27 r 4(1). In some circumstances it may be appropriate --- and relevant --- to inquire into the circumstances in which an order was made pursuant to O 27 r 2; in other circumstances it may be neither appropriate nor relevant. What made it appropriate or relevant to inquire into the circumstances in which the present subpoena was obtained was not explained other than to contend that a legitimate basis had initially been made for the order under r 2. Self-evidently, no Judge would make an order that a subpoena be issued if the material available at the time of the making of the order did not support the making of that order. But r 4 makes equally self-evident the power to later set aside a subpoena. It is not considered that there should be any necessary reservation in setting aside a subpoena on an application being made under r 4 simply by reason of the fact that leave to issue the subpoena has been sought and obtained. That which may appear appropriate upon the limited materials available at the time of the making of an order under O 27 r 2 may well need to be revisited in the light of possibly further evidence or more detailed submissions when an application is made under O 27 r 4. It may also be appropriate to revisit an order under O 27 r 2 by reason of later developments in a proceeding, including applications to amend pleadings. The discretion conferred by r 4(1)(a) must be exercised by reference to those relevant facts and circumstances known at the time that rule is invoked. More importantly, however, it is not considered that there is any legitimate forensic purpose now being pursued by the Second to Sixth Respondents in seeking the production of the documents embraced by the subpoena at this point of time. In so concluding, it is recognised that a subpoena can be made returnable at a date prior to hearing. Indeed, there may well be many practical reasons why such a course may be desirable: Southern Pacific Hotel Services Inc v Southern Pacific Hotel Corporation Ltd [1984] 1 NSWLR 710 at 716 to 717 per Clarke J. So much was not put in issue by Counsel on behalf of Pharm-a-Care and IMF. A subpoena may be made returnable at a date prior to hearing where it is " in the interests of justice and the proper and expeditious conduct of a proceeding " to do so: Hughes v Western Australian Cricket Association Inc (1986) 66 ALR 541 at 543 per Toohey J. The time at which a subpoena is sought or served may, however, be of relevance to an order setting it aside: cf Kennedy v Wallace [2004] FCA 636 at [26] , [2004] FCA 636 ; 136 FCR 114 at 121 per Gyles J. At present, the issues to be resolved --- at least insofar as the strike-out motions are concerned --- are to be resolved on the pleadings. If the pleadings do not expose a sufficient basis upon which the proceeding can proceed under Pt IVA of the 1976 Act, they will be struck out. That is a matter to be resolved on the basis of the pleadings as they stand, or possibly upon the basis of some future foreshadowed further amendment. In circumstances where there is both an application to strike out the existing pleading and a foreshadowed further amendment, it is considered to be the more prudent course to resolve those claims for relief first. The documents sought by the subpoena have no relevance to those motions. If those motions succeed insofar as they seek to challenge the manner in which Pt IVA is invoked, the documents covered by the subpoena may never have any immediate relevance; if the motions are unsuccessful and the description of Group Members is amended, a subpoena directed to a description of the Group Members as at December 2008 may be of little more than historical interest. The stage which a proceeding has reached, and the issues to be resolved at interlocutory applications, are matters of immediate relevance to whether an order should be made for a subpoena or for a subpoena to be set aside: Re Universal Press Pty Limited v Provest Ltd (unreported, FCA, Hill J, G136 of 1989, 14 July 1989). Rather it seems to me, so that the issues are defined, that it will be a rare case indeed where the interests of justice will require a subpoena to be issued until the ordinary interlocutory steps have been completed. I use trial as encompassing of course interlocutory motions should such motions be relevant. And it matters not whether the forensic purpose of the Second to Sixth Respondents is tested by reference to their outstanding Motions to strike out the existing pleadings or by reference to their application for summary judgment pursuant to s 31A of the 1976 Act. Evidence as to facts is relevant to an application made under s 31A: Imobilari Pty Ltd v Opes Prime Stockbroking Ltd [2008] FCA 1920 at [3] to [8] [2008] FCA 1920 ; , 252 ALR 41 at 43 to 45 per Finkelstein J. But it was accepted by Senior Counsel on behalf of the Second to Sixth Respondents that those submissions of relevance to the identification of the present forensic purpose being pursued were its submissions that judgment should be entered pursuant to s 31A (in summary form) by reason of: the alleged failure to properly identify those persons to whom a public duty was said to be owed for the purposes of the tort of misfeasance; the failure to properly plead the manner in which any breach of duty was said to have caused loss or damage; and the failure to properly plead the loss or damage said to have been suffered. Such facts as may have been exposed by documents otherwise falling within the subpoena could thus not assist the Second to Sixth Respondents in its forthcoming application for judgment pursuant to s 31A. Nor is the identification of the forensic purpose sought to be pursued by the Second to Sixth Respondents in seeking the production of documents from IMF (Australia) Limited assisted by submissions as to whether or not Pharm-a-Care has complied with the obligation imposed upon it by O 15 r 10. The stage at which a subpoena is issued will necessarily depend upon the facts and circumstances of each individual case. Such relevance as the subpoena was seen as potentially having at the time the order was made for its issue has been answered by: the identification or clarification of the forensic purpose being pursued by the Second to Sixth Respondents; and the submissions now advanced by Counsel on behalf of both Pharm-a-Care and IMF (Australia) Limited. This conclusion in respect to the present subpoena does not preclude an application being made for an order under O 27 r 2 for a subpoena in the same or like terms at some future date. | leave to issue subpoena application to have set aside general discretion weight to be given to the need to obtain an order for the issue of a subpoena the practice of a subpoena returnable before hearing practice and procedure |
These are the settled reasons of the oral reasons delivered on 2 August 2007. 2 The applicants complain about the conduct of the trustee of the estate former bankrupts, the second and third respondents. The applicants' essential complaint is that they, in particular the first applicant, have lost the opportunity to buy some valuable real estate which formed part of the estate of the bankrupts. The second applicant, Mr Michael McGurk, is an astute man who can for the purposes of these proceedings relevantly be described as a property developer. The first applicant, Labocus, is a corporate vehicle controlled by him and which was the proposed purchasing entity of the land in question. The former bankrupts, two brothers, Messrs Milton and Glen Naylor, were farmers who worked the subject land in Perthville not far from Bathurst. Mr Hugh Thomas was the former trustee in the bankruptcies of the Naylors and now is the trustee of a composition of the Naylors, the validity of which is the subject of this proceeding. 3 An explanation of the issues in the case can conveniently await an outlining of the essential facts. 4 Prior to 25 July 2006, the Naylors were registered proprietors of various parcels of land at Perthville. Mr Thomas became the trustee of their separate estates and their joint estate. In due course, Mr Thomas became registered proprietor of the land by conversion applications. 6 The creditors of the three estates were set out conveniently in annexure E to the Report to Creditors, which is Annexure A to these settled reasons. The land was the major asset of the Naylors. It was their family farm and one can infer a clear emotional involvement by the Naylors in their bankruptcy. One of the witnesses referred to it as a "challenging bankruptcy". By all the evidence, the Naylors were difficult to deal with and made the administration of the estate by Mr Thomas more difficult than it needed to be. 7 Mr John Fagan of Raine and Horne, a local real estate agent, was appointed to sell the land. An auction occurred on 7 December 2006. At that auction, the reserve price was not met. A notice to give vacant possession had been issued to the Naylors on 13 November 2006 and not complied with. The Naylors, it is fair to say on the evidence, had hampered the process of sale, especially inspections, by their conduct and the condition of the land. As I said, the auction failed to reach the reserve price of $580,000. By 30 January 2007, Mr Fagan advised that the general condition of the land was "a disgrace". Proceedings for possession were commenced in February 2007 in the Supreme Court of New South Wales. In February 2007, an offer of $425,000 to buy the land came forward from interests referred to in the proceedings as the "Shute interests". Creditors were consulted and the offer was increased to $445,000. 8 On or about 16 March 2007, Mr Thomas was advised of a refinancing proposal by the Naylors in which the sum of $685,000 was to be paid leading to the annulment of the bankruptcies. The $685,000 was subsequently reduced to $620,000. Not long after 16 March 2007, Mr McGurk became aware of the property being available for sale. Mr Thomas had a conversation with a Mr Hugh, one of Mr McGurk's solicitors. In this conversation, the existing $445,000 contract was discussed and Mr Hugh asked Mr Thomas what price it would take to beat the other purchaser. Mr Thomas referred to a million dollars and laughed. This exchange, I infer, was to ensure, on Mr Thomas' behalf, that all negotiating as to the purchase price was done by the person whom he intended to undertake that task, being Mr Fagan. Nevertheless, it is important to understand that Mr Thomas had made clear to him by Mr Hugh in this conversation that Mr McGurk was willing to pay more than the existing purchaser. 9 Mr Fagan then received a telephone call from an associate of Mr McGurk, a Mr Hamish Williamson. This contact was less than constructive. Mr Fagan thought that Mr Williamson might be associated with the Naylors and thus possibly part of some further hindering activity. Given what had occurred in the past, that was not an unreasonable assumption. Mr Fagan also knew that Mrs Naylor had picked up a copy of the Shute contract not long before. Mr Fagan also formed the view that Mr Williamson was rude to him. Mr Fagan gave evidence, Mr Williamson did not. It is not necessary or appropriate for me to comment one way or the other on the politenesses or otherwise of the two gentlemen at the time, but it is sufficient to note that Mr Fagan, who gave evidence, was not likely to be one to step backward too easily in such an exchange. 10 Mr Fagan shortly thereafter spoke to Mr Hugh. This conversation took place after Mr Fagan and Mr Thomas had spoken about Mr Fagan's first conversation with Mr Williamson. Mr Fagan had been asked by Mr Thomas to treat the coming inquiry that he anticipated as one which was not from the Naylors, but which, Mr Fagan should assume, was genuine. In this later conversation that Mr Fagan had with Mr Hugh, an offer price of $485,000 was reached. It is of some importance to understand how this came about. Mr Fagan, whose evidence I accept, when asked what price would get the property, in effect, tendered the price of $485,000. It was not a price bargained down from the reserve to extract what Mr Fagan could expect to understand at the time would have been the highest possible offer from Mr Hugh. There was no basis for Mr Fagan to think that this was the highest bid that Mr McGurk would ever make, but it was the price struck for a bargain to sell the land. 11 Mr Fagan later told Mr Thomas this when Mr Fagan reported the conversation. It is fair to say, and I am not the slightest bit critical of Mr Fagan (it had not been an easy bankruptcy for him either) that Mr Fagan was slightly embarrassed in the witness box that he had not done a particularly rigorous job in bargaining for the purchase price. At the same time, his view was that it was probably a fair value of the land, certainly $40,000 above an existing contract. Thus, both Mr Thomas and Mr Fagan knew how the $485,000 had been reached and neither had a basis to think that it was Mr McGurk's absolute limit, if that issue came up for consideration. (In fairness to both gentlemen, neither said as much in their evidence. ) Thereafter, negotiations, including as to special conditions and deposit, continued and contracts were exchanged on 5 April 2007. Completion was conditional on creditors' approval. 12 On 1 May 2007, Mr Thomas wrote to the creditors with the Report to Creditors to which I have referred and a notice of meeting for 11 May 2007, at which the creditors could consider whether or not to authorise proceeding with the McGurk contract for the Perthville land. By that time, there was also a proposal from the Naylors, said to be under s 73 of the Bankruptcy Act 1966 (Cth). The Report to Creditors was one document. There was one notice of meeting, but for each of three meetings, being the meetings of the creditors of the joint estate and the two single or several estates. There were proxy forms and statements of claim and the Report to Creditors was the third such report in the bankruptcies. The Report to Creditors gave the history of the bankruptcies. Amongst other things, it described the difficulties in the conduct of the bankruptcies. The report to creditors described the refinancing proposal, put forward by the Naylors. This sum was subsequently amended to $620,000 to allow for financing and other costs. Enquiries by the Trustee's Solicitor have revealed that there was no finance approval. Please refer to Section entitled --- Section 73 Annulment Proposal. By this stage of the bankruptcy, and paying off the secured creditors, $109,921 would be left for the unsecured creditors, assuming a further modest trustee's remuneration. The Report to Creditors then discussed how that $109,921 would be distributed in each estate if proportional values were attributed to each estate and s 110 of the Bankruptcy Act was followed. That proposal was annexed to Report to Creditors and is Annexure B to these settled reasons. Until such the letter is received the Trustee, nor are the creditors, able to determine the ability to implement the terms of the proposal [sic] . The Trustee has requested provision of the letter and has received numerous assurances that the confirmation of finance is forthcoming however at the date of this report NO confirmation has been received. 15 The Report to Creditors then provided an analysis of projected returns to creditors under the s 73 proposal. The estimated total available funds for return was $259,399 as against $109,921 from the McGurk contract. This led to an estimated projected return of 80.6 cents in the dollar, or 77.53 cents if the creditors approved an ex gratia commission payment to Raine and Horne for the work done in attempting to sell the property. (The creditors did approve that payment. As third parties have provided additional securities in the form of additional real estate and additional securities by way of guarantees, it is not possible for the trustee to apply the provisions of Section 110 0f the Bankruptcy Act . Indeed the terms of the proposal do not anticipate such application. (See Annexure A to these settled reasons. The creditors in Milton Naylor's estate would receive a very nominal return. It would appear that both alternatives benefit the bankrupts' creditors. He was not a creditor. Mr McGurk was an experienced buyer and seller of land. Upon becoming aware of the availability of the land he wanted to buy it. He said in evidence, and I accept him, that he thought $485,000 was, in effect, a price reflecting very good value, in particular because of the multiple titles. He perceived the capacity to on-sell the properties. It is unnecessary to resolve some of the minor factual contents as to who said what to whom in the weeks leading up to 11 May 2007. By and large I accept Mr McGurk's evidence as truthful. There was some cross-examination of him on some aspects, in particular the content of his conversation with the valuer, but I accept in his evidence that he was well able to understand or appreciate for his own purposes what he perceived to be the value in the purchase from a general understanding of the location of the land and of its title status. 20 By late April and early May 2007, Mr McGurk was becoming anxious. On about 7 May 2007 his solicitors sought to set a day for completion of the contract. I infer that Mr McGurk's anxiety was significantly driven by the fact that he appreciated in his mind that he was getting a good deal. After Mr McGurk's solicitors sought to set a date for completion the two solicitors (that is for Mr McGurk and the trustee) corresponded. From this, Mr McGurk's solicitor and Mr McGurk became aware that a meeting of creditors had not yet been held. On 8 or 9 May 2007, Mr McGurk spoke to one of the valuers of the property who informed him that there was a proposal from the Naylors. Mr McGurk says that at this time he did not understand that the terms of the proposal of the Naylors would or might affect his sale going through. He was cross-examined on this forcefully; however, I accept Mr McGurk in his evidence in this regard. I do not think it is crucial in any event. Mr McGurk was certainly anxious. As I said, I think that anxiety arose from a desire not to see a valuable opportunity slip, if I may use the expression, "between cup and lip". He wanted to keep the pressure on the trustee, I find, to minimise the risk of the matter drifting which might allow unforseen events to intrude. He told me that he had received a proposal from the Naylors. The Naylors are trying to get out of bankruptcy and have to put up a proposal to do this. Thomas said to me that the Naylors' proposal had no details or any evidence of the finance they are trying to obtain. Thomas said to me that your contract will be approved by the creditors at the creditors' meeting to be held tomorrow. Hugh Thomas didn't call a creditors meeting until tomorrow as he wanted to give the Naylors time to put up the proposal to creditors as he is bound to do. There had been the conversation with the valuer and there was the conversation with Mr Fagan. In negotiating the Conditions of the Sale Contract with you, your client insisted on creditor approval and a short settlement time of 28 days-see Special Condition 63 of the Contract exchanged on 5 April 2007 (hereafter "the Sale Contract"), and in particular condition 63.2 and 63.4. Thus, there was an appreciation in Mr McGurk (however it had arisen) by late on 10 May 2007 that there was some inconsistency between the proposals to go forward on the following day. 23 The letter adopted, and I do not say this critically, a reasonably aggressive standpoint. It can be seen from the terms of the letter that a proposition was being put that Mr Thomas was in breach of his obligations under the sale contract if there were inconsistent proposals at the meeting. I find that the letter reflected Mr McGurk's instructions, and that it also reflected his desire to ensure that he obtained the property at what he saw to be an advantageous price. Mr Thomas, thereafter, appeared to instruct his solicitor, Ms Gregson, not to respond to the letter that evening. It is fair to say, and it was accepted by Mr McGurk's senior counsel, that in the position the parties found themselves on the afternoon of 10 May 2007, that was a sensible course to take. There was no point in engaging in combative correspondence denying breaches of contract when, as far as Mr Thomas was aware, the likelihood was that the meetings would approve the sale to Mr McGurk's company, because of the inadequacies of the Naylors' then proposal, with the lack of clarity in the financing from Nation Finance. It would only be costly to engage in that. Mr Thomas already had some directed proxies to vote for Mr McGurk's contract and he intended to exercise the undirected proxies in that fashion. Mr Thomas had written on 9 May 2007 to creditors stating that as at that date the finance for the s 73 approval had not been confirmed. 24 Shortly prior to the meeting the following day, 11 May 2007, Mr Thomas was informed by facsimile by lawyers acting for the Naylors of a new financier. Nation Finance had withdrawn and the enclosed letter was described as an unconditional offer of finance. Release of all securities currently held by the trustee. The substantial differences from the first proposal were that there was a new financier and that there was reduced security for Fair Go Finance --- only Sandra Lynne Naylor's real property interest was to stand as security. I will come back to the differences between the two proposals in due course. This "amended s 73 proposal" is Annexure C to these settled reasons. 26 At 10 am on 11 May 2007, Mr Thomas convened the meetings. The meetings were held consecutively. The meetings were described in paragraphs 31, 32, 33 and 34 of Mr Thomas' affidavit as follows, which I accept. A copy of the letter dated 1 May 2007, the Notice of Meeting of Creditors and Report to Creditors is exhibited to this affidavit and marked "HCT 14". On 9 May 2007 I wrote to the creditors of the bankrupt estates of Milton Alexander Naylor and Glen Ellwyn Naylor, advising them that finance approval relating to the Section 73 proposal from Milton Alexander Naylor and Glen Ellwyn Naylor included in the Report to Creditors referred to in paragraph 31 of this affidavit, had not been confirmed. A copy of the email to creditors dated 9 May 2007 is exhibited to this affidavit and marked "HCT 15". On 11 May 2007 at 10.00 am, I convened the Creditors Meetings referred to in paragraph 31 of my affidavit. The three meetings were conducted consecutively; the first for the creditors of the joint bankrupt estates of Milton Alexander Naylor and Glen Ellwyn Naylor commenced at 10 am and was adjourned at 10.20 am, the second for the creditors of the bankrupt estate of Milton Alexander Naylor commenced immediately after the first and adjourned at 10.28 am and the third for the creditors of the bankrupt estate of Glen Ellwyn Naylor commenced immediately after the second and adjourned at 10.34 am. Other than myself, the Creditors Meetings were attended in person by my assistant, Ms Hummelstad, who took the minutes of the three meetings, by the bankrupts, Milton Alexander Naylor and Glen Ellwyn Naylor, by Sandra Naylor, and by two observers, Mr Friedlander and Mr McLaughlin. At the meeting of the creditors of the joint bankrupt estates of Milton Alexander Naylor and Glen Ellwyn Naylor two creditors, Elders and the ATO, attended by proxy by phone. I received specific proxies from NFFA and Blue Shearing. At the meeting of the creditors of the bankrupt estate of Milton Alexander Naylor, Elders attended by proxy by phone. I received specific proxies from NFFA, Blue Shearing, Buckwheat Enterprises, Avco Access Ltd and Auto Watt Pty Ltd and general proxies form PR Master Stephens & Co, Credit Corp Services Pty Ltd and AD & DR Klavins. At the meeting of the creditors of the bankrupt estate of Glen Ellwyn Naylor, Elders attended by proxy by phone. I received specific proxies from NFFA and Blue Shearing. All the proxies were tabled at the Creditors Meetings. I formed the view that there was a quorum present at each of the Creditors Meetings. I informed the meetings that I had received, prior to the meetings, a facsimile from McMahons Lawyers attaching a copy of an email from Fair Go Finance, advising of the unconditional provision of finance and attaching an amended section 73 Proposal. As stated in paragraphs 31 and 32 of my affidavit, I had previously informed the creditors, by letters dated 1 May 2007 and 9 May 2007, that the finance approval had not been confirmed. Each meeting resolved unanimously to adjourn each meeting to 3.00 pm that afternoon so that I could make further enquiries to satisfy myself that the finance offer was genuine. A copy of the facsimile from McMahons Lawyers attaching the email from Fair Go Finance and the amended section 73 Proposal dated 11 May 2007 is exhibited to my affidavit and marked "HCT 16". He was told by the person answering the phone that Mr Thomas was not available and that a message would be left for him to ring Mr McGurk. Mr Thomas did not ring Mr McGurk. He did not return his calls on that day at all. Mr Thomas says, and I accept him, that he did not know Mr McGurk had called. There was no issue in the case that Mr McGurk had called. The office system in Mr Thomas' firm was proved in evidence before me and the only conclusion is that there was a breakdown in that system such that Mr Thomas did not have brought to his attention the messages waiting for him from Mr McGurk. I'll have to check with our lawyers. We are a broker, we endeavour to place matters like this with other lenders but if we can't place it within the time required we can finance it internally. We have loans of about six million dollars rolling over on short term loans. Following the telephone conversation described in paragraph 35 of my affidavit, Mr Paton sent a facsimile to me outlining Fair Go Finance's procedure with regard to the provision of the proposed finance. Mr Paton then sent a second facsimile outlining Fair Go Finance's current loan assets. Copies of the two facsimiles are exhibited to my affidavit and marked "HCT 17". He then spoke to a number of creditors, three in particular: Blue Shearing, Buckwheat Enterprises and National Finance (NFFA). After these conversations, these creditors decided to vote for the amended proposal. Mr Thomas also decided to change his undirected proxies vote to the amended proposal. It should be noted that Elders and the Tax Office were present at the meetings by telephone. At 3 pm, the adjourned meetings were convened. The three Creditors Meetings as described in paragraph 33 of my affidavit were reconvened consecutively from 3.00 pm on 11 May 2007. The reconvened meetings were attended in person by me, my assistant, Ms Hummelstad, who took the minutes of the meeting, by the bankrupts, Milton Alexander Naylor and Glen Ellwyn Naylor, by Sandra Naylor, and by two observers, Mr Friedlander and Mr McLaughlin. At the reconvened meeting of the creditors of the joint bankrupt estates of Milton Alexander Naylor and Glen Ellwyn Naylor two creditors, Elders and the ATO, attended by proxy by phone. I received specific proxies from NFFA and Blue Shearing. At the reconvened meeting of the creditors of the bankrupt estate of Milton Alexander Naylor, Elders attended by proxy by phone. I received specific proxies from NFFA, Blue Shearing, Buckwheat Enterprises, Avco Access Ltd and Auto Watt Pty Ltd and general proxies from PR Master Stephens & Co, Credit Corp Services Pty Ltd and AD & DR Klavins. At the reconvened meeting of the creditors of the bankrupt estate of Glen Ellwyn Naylor, Elders attended by proxy by phone. I received specific proxies from NFFA and Blue Shearing. I formed the view that there was a quorum present at each of the Creditors Meetings. I informed the meetings that during the adjournment an amended section 73 Proposal had been lodged at the Insolvency & Trustee Service Australia and the amended section 73 Proposal was tabled for inspection. At the Creditors Meetings the ordinary resolution for the sale of the Land referred to in paragraph 31 of my affidavit was put to the creditors and passed by majority in the negative. In each of those meetings the creditors of the relevant estate voted against the sale and for the amended s 73 proposal. At no time on 11 May 2007 did Mr Thomas try to contact Mr McGurk. His affidavit gave no real explanation for this. It is to be recalled that both he and Mr Fagan had no belief and had no basis to believe that Mr McGurk had offered the last dollar in his pocket, if I may use that expression, for the property. Indeed, they had grounds to believe that he had not. 30 It is also to be recalled that Mr Hugh had said to Mr Thomas that they would pay whatever it took to win the land. It is also to be recalled that Mr McGurk's solicitors had been pressing the evening before. Further, though I accept Mr Thomas did not appreciate it at the time, the breakdown of his own office procedures meant that he was not aware that Mr McGurk had already rung twice that day. 31 In cross-examination, Mr Thomas said, in effect, the following: that if he had received the amended s 73 proposal the day before he would have gone back to Mr McGurk to see whether he could obtain more money from him; that he should have gone back to Mr McGurk on 11 May 2007; that he created the pressure for himself on the day; that a "very small factor" weighing on him was to close the deal and "get the Naylors out of his life"; and that he forgot to turn his mind to go back to speak to Mr McGurk. 32 On the evidence, I am not prepared to conclude other than that most of the creditors, in respect of any relevant resolution, wanted the largest amount of return. That proposition must of course be read and understood in the light of the separate nature of the estates and the possible different flows of money from a direct infusion from the sale of the land, whether of $485,000 or more, and the rateable equal distribution in the proposal of the Naylors. The creditors were entitled to assume that the amended s 73 proposal and the offer from Mr McGurk were the best two offers reasonably available from the work of the trustee to date and were the best two offers reasonably available as far as the trustee was aware. Unfortunately, I do not think that that can be said to be the case. 33 Mr McGurk says, and I accept him, that he would have offered up to $685,000. That is, $200,000 more. Precisely how that would have manifested itself in a process of bargaining, however, with, if I may say so without the slightest intent of disrespect, a likely tough bargainor such as Mr McGurk, is impossible to identify. That extra $200,000 is a product of Mr McGurk being frank with the Court in an attempt to win his case, and once again I do not say that in the slightest critically. The creditors, however, were deprived of the possibility of extracting some more money from Mr McGurk and perhaps even the Naylors through, I am bound to say, a too hurried and, I think, careless conduct of affairs on the day by Mr Thomas who should, doing his job in the interests of creditors, have plainly gone back to Mr McGurk. He did not do so, and the creditors in each meeting voted for the composition. The meetings took place in the afternoon of Friday, 11 May 2007. Mr Thomas' solicitors informed Mr McGurk's solicitor of the recision of the contract pursuant to clause 63.5 on that day. 34 At this stage, it is worth appreciating the following aspects of the funding of Fair Go Finance on 11 May 2007 and later. At the Creditors Meetings, described in paragraphs 33, 34, 43 and 44 of my affidavit, I reported to the creditors that the funds from Fair Go Finance would be available in about 30 days. The record of this statement appears at page four of the Minutes of Meeting of Creditors for the joint bankrupt estates of Milton Alexander Naylor and Glen Ellwyn Naylor which form part of exhibit "HCT 20" to my affidavit. In my email to all creditors sent on 11 May 2007, which appears at Exhibit "HCT 18" to my affidavit, I wrote that "settlement could take place within 1 month". On 5 June 2007, I am informed by my solicitors, and I verily believe, that Fair Go Finance's solicitors sent a facsimile to my solicitors confirming that Fair Go Finance would be in a position to settle the composition amount under the section 73 Proposal "very shortly" and requesting confirmation that I am ready and able to transfer the Land to Milton Alexander Naylor and Glen Ellwyn Naylor as required by the section 73 proposal. Exhibited to my affidavit and marked "HCT 31" is a copy of the facsimile from McMahon's solicitors dated 5 June 2007. Mr McGurk's solicitors wrote a letter as contained in tab 24 in exhibit A. Again without the slightest criticism of Mr Chaffey or Mr McGurk, it should be noted that the letter was immediately, in a legal sense, aggressive, in that the position of Mr McGurk was put with clarity and a degree of forcefulness. The letter asked by 5 pm that day for various documents. It noted that Mr Thomas had purported to rescind the contract and that the request for documents was for the purpose of advising Mr McGurk and Labocus as to the rights of Labocus and the request for such documents was not an affirmation of the alleged rescission and that as to rescission Labocus' rights remained reserved. 36 Two days later, on 16 May 2007, the solicitors for the trustee responded to that letter. They refused to give documents, proposals, agendas and reports and other correspondence provided to the creditors to Labocus and Mr McGurk's solicitor. Certificates of resolution were provided. A copy of the first Naylor proposal and amending proposal were provided and documents said to reflect compliance with condition 63 of the contract were not agreed to be provided. On 24 May 2007, Mr Thomas' solicitors wrote to Mr Chaffey about the caveat, setting out the terms of the contract and demanding that the caveat be withdrawn. After an extension of time was granted to Mr McGurk's solicitors to enable them to advise Labocus and Mr McGurk, on 29 May 2007, Mr Chaffey wrote a detailed letter to the trustee's solicitor reflecting many of the issues litigated in these proceedings. It is unnecessary to set out the letter in full. It should be noted, however, that the following issues were raised, the solicitors having had an opportunity to obtain instructions. It was contended that the contract had not been validly rescinded, hence the maintenance of the equity in the property to ground a caveat. It was contended that the resolutions at the meetings were not validly put to the creditors or validly passed by them. Pages 2 and 3 of the letter then set out the reasons for these ultimate propositions. 38 The letter also stated that Labocus remained ready, willing and able to complete the contract and, if necessary, amend the purchase price to provide a better return to creditors. The letter indicated that Labocus was preparing an application to the Court. The trustee did not wait for any justifying proceedings for the caveat under the Real Property Act 1900 (NSW) and moved of his own motion to remove the caveat. Those proceedings are still in the Supreme Court although they are stayed, as I understand it, while these proceedings are resolved. Additionally, the trustee has propounded a cross-claim in these proceedings, in effect mirroring all the relief claimed in the Supreme Court caveat proceedings so that there will be no need for the Supreme Court proceedings once these proceedings are resolved. 39 The Federal Court proceedings were commenced on 20 June 2007 and amended on 26 June 2007. The amendment joined Mr McGurk, who by that stage --- that is, 26 June 2007 --- had become a creditor by assignment of a small number of the debts to him (under $500). I made an order at the beginning of the case that this amendment would only run from 26 June because Mr McGurk did not become a creditor until assignment on 25 June. There was an issue as to whether there had been notice given for the purposes of s 12 of the Conveyancing Act 1919 (NSW). The evidence discloses that value was given for the assignments. Mr McGurk was undoubtedly the equitable owner of the debt. If he was not the legal owner, then there may be a technical deficiency in the parties to the suit. Any such technical deficiencies is within the Court's power to absolve. In any event, notice of the assignments was given by the evidence in the proceedings which showed to the Naylors, being parties to the proceedings, the fact of the assignment. In any event, this issue need not delay me any further, but it is worthwhile noting that until 25 June 2007 Mr McGurk was not a creditor and he only assumed the status of creditor, I would infer, to improve his status in the proceeding and to give him a right beyond the existing rights of Labocus under s 178 of the Bankruptcy Act and the Trade Practices Act so that he could invoke, as he does, ss 222 and 222C of the Bankruptcy Act to set aside the compositions. In saying what I have just said, once again I am not being critical of Mr McGurk or his solicitors for taking that technical approach. It was a perfectly legitimate and sensible course to take to have taken to arm him with the maximum amount of rights to vindicate what he saw as his rightful position. 40 As can be seen from the correspondence, which I will not go into in any further detail, there was a degree of immediate, aggressive legal position-taking, both as to the caveat and as to the application. 42 The review was sought in the original application over a myriad of facts in relation to the conduct of Mr Thomas. They were grouped under various headings, but essentially of failing to inform Mr McGurk of the Naylors' proposals, failing to get the best price for the creditors, failing to inform Labocus of the s 73 proposal, failing to ascertain what Labocus was prepared to pay and failing to inform creditors of those failures. I will not set out in full all the various aspects that were attacked in the application. It was amended on 26 June 2007 and later amended at the end of the trial with leave, but it is worthy of note that every aspect of the conduct of Mr Thomas that could conceivably be attacked was attacked and every point that could be made was made. 43 Declarations were sought that the procedural steps taken by the trustee were invalid; that the second proposal was a fresh proposal and not an amendment; attacking the resolutions; attacking the validity of the composition and attacking the validity of the annulment thereby; that the contract was not validly rescinded; that Labocus had an equitable interest; that there could be a variation of contract; and an order was sought, in effect, that the whole issue of what should occur should go back to creditors. After the amendment the same thrust of attack remained; however, orders were now sought not only on the basis of ss 30 and 178 but also, as I said earlier, on the basis of ss 222 and 222C . This subsection does not limit subsection (8). If the Court, on the first-mentioned application, makes an order under this section setting the personal insolvency agreement aside, it may, if it thinks fit, immediately make the sequestration order sought. This subsection does not limit subsection (3). If the Court, on the first-mentioned application, makes an order under this section terminating the personal insolvency agreement, it may, if it thinks fit, immediately make the sequestration order sought. In the amendment to the application the allegations of misleading or deceptive conduct were removed; however, damages were still sought and still are sought against the trustee by Labocus and Mr McGurk for his conduct. At the hearing, various of the issues raised in the amended application were abandoned. In particular, the various procedural or meeting law attacks on the resolutions and on the proxies were abandoned. They were still relied on as illumination of what was said to be the hasty and careless conduct of Mr Thomas on the day. 46 In relation to those proposed orders under ss 30 , 178 , 222 and 222C , the question of the terms and conditions, including the dealing with the costs of the application, all came into play as a fluid body of claimed relief, but essentially --- if I may use the expression --- to put Mr McGurk back in the picture as having an opportunity to purchase the land. At one level, Mr McGurk wished to circumvent going back to the creditors and indicated through his counsel that upon the setting aside of the compositions the order should be that he should have the land, in effect, at $685,000. 47 Thus the issues require for their resolution a conclusion as to whether the proposals, resolutions and composition, and thus annulments, were valid and effective. 48 If I were of the view that they were not effective, then, in effect, there would not necessarily be any need to unravel what has happened, because it would not have had the effect that the parties hitherto had understood it to have had; that is, of valid resolutions, valid composition and valid annulments. If I were of the view that the proposals, resolutions and composition, and thus annulments were effective, subject to any order that might be made, I would then need to ascertain whether, under the provisions to which I have referred, orders should be made unravelling the position and on what terms and in what way. The essential grounds of the ss 178 , 222 and 222C claims are the same: that is, that Mr Thomas failed in his obligation to creditors and failed in a duty to Mr McGurk and Labocus; and that Mr Thomas should have informed Mr McGurk and Labocus of the Naylors' proposals, such that a form of auction could then have taken place, without rush, to ensure that the creditors obtained the highest price for the land. What underpins the case on Mr McGurk's behalf is that he had a confident view that he would be able to prevail in that bidding process. 49 I then turn to the issues. The first ground was that each proposal was a joint document signed by Milton and Glen Naylor which sought, in one document, to put forward a composition in respect of all creditors. The two proposals, both the original and the amended, sought to intertwine and deal with all estates. The second argument was that the first Naylor proposal was not a proposal within the meaning of s 73 because (a) no unconditional offer for finance from Nation Finance was available when the proposal was circulated; and (b) there was no express time limit for the performance by the Naylors. The third issue was whether the second Naylor proposal was a proposal within the meaning of s 73 because there was no time limit for performance of the obligations on the part of the Naylors. The fourth issue was whether the second Naylor proposal was an amendment of the first, or a fresh proposal so as to require a separate report. 50 All these issues require an understanding of the purpose of Parliament in removing, in 1992, the need for a Court hearing to approve a composition. This is an expensive and cumbersome process, and the courts have in many cases expressed reluctance to interfere with the wishes of creditors as expressed by resolution or special resolution in a meeting. This approach by the courts usually means that approval is granted to compositions and schemes and annulment of bankruptcies ordered. To ensure that the system works more efficiently, where a bankrupt proposes a composition or scheme and this is accepted by special resolution, it will operate to annul the bankruptcy automatically. That expression was used by the Full Court in Prentice v Wood [2002] FCA 214 ; (2002) 119 FCR 296 at 300 in discussing the power in s 149C(1)(c). I do not find those expressions of any particular assistance in construing ss 73 and 74 and in ascertaining the statutory consequence of any failure to comply (if that occurred) with ss 73 and 74 . 53 The public and private importance of the change of status in making a party bankrupt is too well known to require detailed citation. It is not a matter merely between debtor and creditor. It affects creditors generally and the public. The bankrupt, while bankrupt, has his or her status changed. Conduct which might otherwise be innocent may become punishable at law. There remains a stigma to the person, often as a mark of failure in life, sometimes of a particularly humiliating character. Though in a dissenting judgment, the seriousness of the matter was luminously expressed by Deane J in Kleinwort Benson Australia Pty Ltd v Crowl [1988] HCA 34 ; (1999) 165 CLR 71 at 82. The public and private interest in discharge or annulment can be seen in many cases such as Re Barton (1980) 43 FLR 245, Re Stainton; Ex parte Board of Trade (1887) 19 QBD 182, Re Haines (1937) 10 ABC 83, Re Gray (1960) 19 ABC 29 and Re Prince (1961) 19 ABC 39 and see also Ex parte Selby; in the matter of Selby and Norton (1855) 43 ER 1437 per Lord Justice Knight-Bruce. 54 Parliament has set out in ss 73 and 74 and Division 6 of Part IV a regime for the annulment of bankruptcy by the action of creditors. Creditors do not act judicially or quasi-judicially in this process. The procedure is placed in the Act for the efficient and timely disposal of matters without the interference of the Court. This is not preventing the bankrupt status being removed. It is a non-curial procedure for the removal of that status. One would look at the provisions accordingly, requiring a businesslike approach by the trustee informing creditors of relevant information, leaving, as far as possible, the decision to be made by practical people of business. The Court should not take any narrow or pedantic view of the structure of the Act for compliance. The procedure is to be followed against the background of the need to inform creditors of relevant matters and to allow creditors to make up their own minds as to what they wish to do. 55 It goes without saying that the procedures required should be viewed from the perspective of the interests of all creditors. In a given case, which is not this one, a Court might look very carefully at any procedure leading to a composition dominated by creditors related to the bankrupt or reflecting a lack of commercial morality or sharp practice. Parliament, however, has chosen to provide in s 74(5) for the annulment and thus for the consequences that flow therefrom: Oates v Commissioner of Taxation (1990) 27 FCR 289 , Re Coyle (1993) 42 FCR 72 , Theissbacher v MacGregor Garrick & Co [1993] 2 Qd R 223, Pascoe; in the matter of Hudson [2005] FCA 1421 , Worrall v Westpac Banking Corporation (1995) 51 FCR 304 and Union Club v Battenberg [2006] NSWCA 72 ; (2006) 66 NSWLR 1. 56 Relevant also, in addition to the interests of the parties, is the interest of the public, as I have said, in a discharge context: see in particular Re Barton 43 FLR 245. The important changes, retrospectively, to the status of the former bankrupt brought about by annulment and the operation of s 74(5) , with the consequential permission of the erstwhile bankrupt to move about the community with full status, also inform the need to construe the provisions with an eye to substance over formality and not subvert the intended practical freedom sought to be given to the bankrupt by procedural issues not affecting in any given case the substance of the legitimacy of the expression of the creditors' views. 57 These considerations go not only to the construction and interpretation of the Bankruptcy Act , but also to assess the consequences of any breach of that which the statute provides for: Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28 ; (1998) 194 CLR 355. When a statute provides for compliance with procedures laid down therein, the consequences of an absence of such compliance upon acts performed pursuant thereto must be assessed. Those procedures, if breached in some aspect, must be examined in their context in order that the Court can understand what Parliament intended to be the consequences of such breach. 58 The question whether information put forward by the bankrupts is sufficient in detail and underlying commercial substance to amount to a proposal will generally be a judgmental decision for the trustee. It may arise at the point of refusal by the trustee to convene a meeting on the basis that there is insufficient reliable material to allow her or him to give an opinion for the purposes of s 73(2A). It may arise at the point of someone seeking to restrain a meeting on the basis that what is being put is not a proposal. In those cases, a substantial question that will arise will be whether there is a proposal of sufficient clarity and reality to permit a judgment of the trustee under s 73(2A). 59 Here, the trustee took the view that there was a proposal. An opinion purporting to be under s 73(2A) was given. Voting took place. The issues are whether there was a proposal and whether the trustee gave an opinion for the purposes of s 73(2A) and if not, whether that made the resolutions, the meeting, the composition and the annulments nullities. 60 In my view, the statute should not be construed in a way which leads to the automatic ineffectiveness of acts taken under it when there has been some failure of procedure. The reasons for my saying that are as follows. First, the trustee, as here, is an officer of the Court and under the control of the Court. Her or his judgment about the adequacy of the proposal and whether it should be put to creditors can be assessed on that basis. Secondly, review of the trustee's conduct is available under ss 178 , 179 and 30 . Thirdly, a composition under s 73 can be set aside or terminated under ss 222 , 222A , 222B , 222C and 222D : see in particular s 76B. For instance, the Court may set aside a composition if its terms are unreasonable or not calculated to benefit the creditors generally: s 222(1)(d) , or for any other reason, s 222(1)(e). See also s 222C(1)(f) and (g). A further sequestration order can be made: ss 222(10) and 222C (5). 61 Given the pervasive control before and after and in connection with a process under the control of an officer of the Court skilled in the kind of business judgments involved, and the participation of self-interested creditors, and given the clear intention of Parliament to remove unnecessary Court interference, I do not think an intention of Parliament can be discerned to make a nullity of all consequential acts if some part of the procedure in s 73 has not been complied with. 62 The first argument is that the first Naylor proposal was an impermissible joint or unitary composition. Section 73 , it was submitted, did not permit two bankrupts to put a proposal in one document. I do not agree. The proposal was joint and several. Section 73 requires a proposal to the bankrupts' creditors. There is no reason why one proposal cannot be put forward, as long as it was put forward to all three groups of creditors, as it plainly was and was intended to be. The proposal, if put to a meeting of an individual body of creditors, can be seen as a proposal put forward by the bankrupt for his creditors to deal with. It is said that the proposal to each estate cannot come in the same joint form and that three cases stand as authority for that proposition; Re Pepper (1969) 14 FLR 282 , Re Tynan; Ex parte Tynan (1997) 16 FCR 307 and Re Edwards (1987) 14 FCR 113. 63 In Re Pepper 14 FLR 282, Gibbs J (as he then was) decided that s 55(1) of the Bankruptcy Act , permitting a debtor to present a petition against himself, did not permit a number of debtors to present a joint petition. This construction was reached because the contrary would have permitted not only joint debtors, that is, debtors to a joint obligation, but several debtors who had no joint assets to present a petition. This case is of no particular assistance here, where as long as the proposal was one which the individual creditors of the individual bankrupt's estate can vote on, no inconvenience results therefrom. There is no inconvenience here of the kind referred to by Gibbs J in that case. 64 In Re Forbes (1974) 24 FLR 87, White J of the Court of Insolvency of South Australia discussed Part IX and s 187 of the Bankruptcy Act . The issue there identified was not the putting of a composite proposal, but the putting of a composite proposal to one undifferentiated meeting. They should have held separate meetings (albeit concurrently) to which separate special resolutions could have been submitted to the relevant classes of creditors, in order that the wishes of interested parties be ascertained, including the existence or otherwise of the appropriate majorities both in number and value. Where there are joint creditors, it is a matter of necessity rather than convenience that meetings are held at the one time and the one place. As will be seen later, care must be taken at such concurrent meetings to separate out the different resolutions relating to each debtor and the classes of creditors entitled to vote in relation to each resolution. This procedure of holding concurrent meetings is best adopted when there are a number of joint debtors". 66 In Re Edwards 14 FCR 113 French J dealt with one joint composition covering two estates, a joint estate and a several estate. Despite some of the language in the judgment, it is clear that the vice identified by his Honour was the single approval for all the estates in one meeting. This can be seen by his Honour's reliance upon the reference to Re Forbes 24 FLR 87. Similarly it would be inappropriate to admit to a vote on a joint composition, separate creditors whose interests might conflict with those of the joint creditors. Each also had separate debts. Creditors of all classes voted on the composite resolution. Each will require a separate meeting of creditors although the meetings can be held concurrently provided that the procedure necessary to maintain the distinction between the two proposals is followed. On this basis I have no alternative but to dismiss the application. Some passages of the judgment of French J appear, taken literally, to prevent under s 73 any joint composition to be entered where there is more than one estate. I do not think his Honour's reasons should be so read, especially in the light of the terms of Re Edwards 119 FCR 113 in the same year. By his Honour's reference to Re Pepper 14 FLR 282 and Re Edwards 14 FCR 113 (and through it Re Forbes 24 FLR 97) and via what his Honour said at pages 312 and 313 about the need for separate meetings, I conclude that his Honour was dealing with the same essential difficulty, that is, of mixing up the voting of different creditors at different meetings. 68 Here, each group of creditors voted on a separate proposal put separately to each meeting. That proposal was in the same form in each meeting. It can be seen as a proposal by each several bankrupt, Mr G Naylor and Mr M Naylor, and then by their family, that a certain proposal be voted on by that separate group of creditors. It is true that the proposal was with his brother, but at the same time it was put forward to the creditors of each individual several estate and also put forward to the joint estate. In my view, in substance there is nothing unlawful about that to prevent the creditors voting as they wished to on whether or not there would be the pooling anticipated by that proposal. 69 The next basis was that the first Naylor proposal was vague and uncertain as the proposal had no unconditional finance. The proposal was for a loan from Nation Finance. The full terms of the proposal are annexed. Inquiries of the trustee revealed a certain inadequacy as to the understanding of the finance. In my view, that did not stop there being a proposal, rather it said something as to its attractiveness. Thus, if the trustee does not have sufficient material upon which the trustee could indicate one way or the other whether a proposal would benefit the bankrupt's creditors generally, then, in my opinion there is no absolut,e and certainly no unconditional obligation on the trustee to call a meeting of creditors. It will be a matter for the trustee to judge whether or not there is sufficient information for there to be a proposal requiring him or her to go to a meeting. A Court may have to assess that at a point in time before any meeting. It is unnecessary to lay down definitional criteria for that beyond the words of the Bankruptcy Act . Each individual case will be different, the circumstances of the estate and the terms of the terms of the proposal will be different. I do not think he was wrong in that. However, even if he were, he decided to take it to the creditors and what followed has been set out above. As I have said in relation to my views on Project Blue Sky [1998] HCA 28 ; 194 CLR 355, even if the first proposal was not a proposal and even if he could not have been forced to take it to a meeting, I do not think that has the consequence of invalidating everything that followed. As I said, I think it was a proposal in that there was an arrangement capable of being accepted, whether or not its implementation was certain I think more went to its attractiveness than as to whether it was a proposal. There was no time expressed for implementation. The law will always imply a reasonable time. Again, if I am wrong and that was such as to make it not a proposal, Mr Thomas' view that it was and that it should go to the meeting was not a failure of procedure which nullifies all that flows thereafter. 72 It is said that the trustee did not provide an opinion of the purposes of s 73(2A) because the trustee only said that it would appear that both alternatives (that is the McGurk contract and the first Naylor proposal) benefited the bankrupts' creditors. There is some force in that: Re Bendel; Ex parte Bendel v Pattison (1997) 80 FCR 123 at 132. But once again, any failure of the trustee to comply with s 73(2A) would not necessarily invalidate what flowed thereafter for the reasons I have already given. I do not see any non-compliance here as fatal to a vote. That is not to say that if the context of the case was injunctive relief to prevent a meeting going ahead because of inadequate information in the opinion of the trustee that such an injunction would not be given. 73 Also, to reinforce what I said earlier, to the extent that there has been inadequate information in the opinion of the trustee, the egregiousness or otherwise of any such error would be, as the asserted error of the trustee here is, a relevant consideration for the operation of ss 30 , 178 , 222 and 222C . Also, for completeness, I do not think it should be accepted as it was submitted here that the first Naylor proposal was not bone fide . The Naylors, who put on evidence, were not cross-examined about that; cf Re Bendel 80 FCR 123 at 131. 74 The second Naylor proposal was equally not too vague or uncertain in my view. There was an unconditional offer of payment even if it came from a finance company who had a letterhead without an address except a post box. The terms of any mortgage were not necessary to vote on. The reduced security from the Naylors' mother dropping out was not a matter for the creditors to be concerned with save and except that it may have meant that the Naylors were not able to last very long out of bankruptcy. But again, given that the creditors were being paid in one lump sum that was not their concern. As to whether there was a certainty of the money being available, these were matters, once again, for the creditors to assess and the trustee to give his opinion on. 75 The second proposal can be seen, I think, to be an amendment of the first proposal. The provider of the money changed, the mortgage arrangements changed and although there were the variations from $685,000 down to $620,000 this was in substance no different to the earlier proposal. Even if I am wrong that there was not an amendment but a new proposal, once again, given the fact that the matter went to the creditors pursuant to the meeting, I do not see the breach of procedure, if it be such, has a nullifying effect on what occurred. 76 Again, if the context of this was that someone was seeking to restrain the meeting taking place because of inadequate information from the trustee and inadequate assurance as to the availability of funds from the financier, it may be that the Court would step in. I reject the arguments that, in the circumstances, there were no proposals, no meetings, no resolution and no composition. 77 Thus the issue is whether, under ss 30 , 178 , 222 and 222C the composition should be set aside and if so, on what terms. First, let me clear some further ground. There was no misleading or deceptive conduct by the trustee. That case was dropped. However, a case was opened by senior counsel for Mr McGurk and Labocus and in putting submissions that there had been a degree of unconscionability and a lack of commercial good practice by Mr Thomas to Labocus and Mr McGurk. I reject those submissions. As will be seen from my reasons shortly and from what I have already said, I do not think Mr Thomas fully discharged the duty that the creditors could expect of him. It is unfortunate that I have to express the matter that way but is necessary to do so. To the extent that Mr McGurk, as an assigned creditor, has a basis to complain about that, having taken the assignment, I will deal with that under the claims under ss 222 and 222C . What I am directing my attention to at the moment is the assertion that Mr Thomas, in some fashion, behaved in a way deserving of criticism by reference to some duty to Mr McGurk, either in law or in commercial morality, arising from the facts as they unfolded at the time. I do not think Mr Thomas can be so criticised. I understand why Mr McGurk has a feeling of complaint, but it was not a breach of duty to him at the time and I reject the proposition that I should be looking at the review of the trustee's conduct under s 178 other than by reference to the interests of creditors. 78 Mr Thomas' duties were to the creditors, not to Mr McGurk at that time. From the facts that I have earlier recited and from what I have earlier said, I do not think Mr Thomas discharged fully and completely his duty to creditors in the way that he should have. It was not a breach of a heinous character or one involving moral turpitude at all on Mr Thomas' behalf. He was frank in the witness box. He accepted that the pressure of the bankruptcies and difficulty in dealing with the Naylors may have been something that led to his overlooking Mr McGurk. I think he is probably right in that respect, but it does not really matter whether that is the explanation or not. Doing the best for his creditors, he should have been calmer and more prudent on the day of the meeting. The composition should not have been rushed through that afternoon. He should have gone back to Mr McGurk and seen what could be done for the creditors. 79 There would have been a cost involved in that, but given all the matters he knew I think it was less than careful of Mr Thomas to rush the matter through on that day without seeing whether, in a day or two, he could not get more from Mr McGurk and thus perhaps more from the Naylors. He forgot to go back to him. As I said, how that would have played out with Mr McGurk is not clear. Mr McGurk now says that he would have paid $685,000, which he now offers. As I said earlier, one can doubt whether he would have been so forthcoming with $200,000 quite as quickly as he has been in these proceedings. Nevertheless, the creditors were less than perfectly served by Mr Thomas. 80 Mr McGurk has become a creditor, though only in a small amount. In relation to the question of setting aside the compositions, I give no real weight to treating Mr McGurk as a creditor distinct from viewing the creditors as a whole and their interests as a whole. Thus, given my views about the meetings and given my views that there has been no breach of any obligation, legal or moral, between the trustee and Labocus or Mr McGurk, in my view there is no basis to conclude that the contract for $485,000 was other than validly rescinded and that there is therefore no caveatable interest in Labocus. A question of discretion, therefore, arises under ss 30 , 178 , 222 and 222C . My primary consideration is the interests of creditors. As I said, Mr McGurk is one, but only for a small amount and only for the purpose of standing. 81 It is not enough, in my view, merely to say that Mr Thomas could have done a better job (which I think he could have) and therefore relief follows. The complexities and costs of sending this back now are not inconsiderable. I have given anxious consideration to how best to deal with the matter. No creditor, other than Mr McGurk, complains. The creditors were not infants: they included Elders Finance, the Commissioner of Taxation and local business people. To a degree, as one would expect, they relied upon Mr Thomas, but at the same time if they have a complaint in relation to him, they can take it up. The question is whether the composition should be set aside, which may not necessarily have an immediate consequence, but which may have an effect on the Naylors' position. I do not think it appropriate simply, over the wishes of the creditors of a joint rateable composition, to force on them a contract with Mr McGurk even for $685,000, distributed according to s 110. 82 I do not think it to be the Court's place to fashion another compromise or composition inserting Mr McGurk's money in place of the Naylors'. The Naylors have an interest and if the matter is to go back it should go back to creditors. All that will involve cost in circumstances where there is not a large estate, when the primary complainant is someone who, except for a small body of assigned debts, was a stranger to the creditors' decision. No other body of creditors has presently come forward to complain. Those creditors, subject to the question of the costs of these proceedings and the caveat proceedings, will get 77 cents in a dollar if Fair Go Finance comes through which, on the evidence before me, is likely. The vicissitudes of the costs and other matters that are uncertain in putting the matter back to creditors may conceivably lead to more money from the Naylors but it may simply mean funds being dealt with according to s 110. 83 As I said, I take into account the interests of creditors but I also take into account that they have voted and expressed a view, at least on the Naylors' second proposal. The trustee's charges are not inconsiderable. I do not say that critically. No doubt, they are in line with the current market and professional practice, but $400 per hour for the further conduct of the matter is not insignificant. 84 Taking all the matters into account and recognising that Mr Thomas did not fully fulfil his obligations, in my view the faults of Mr Thomas are insufficient to justify setting aside the composition on any of the grounds that are available in ss 222 or 222C or exercising a general discretion under ss 30 or 178 . As I said, I see no breach of duty or sharp practice towards Labocus or Mr McGurk to found relief. Subject to the orders that I propose to make about costs, I propose to leave the composition where it lies. That view is based on doing as much as possible to ensure that no further imposition of costs affects the estate for creditors. 85 Mr McGurk and Labocus have aggressively pushed their rights. As I said earlier, that is not said critically, they were perfectly entitled to do so. They made wide assertions which they have not made out, some of which they abandoned and I do not criticise them for that. The assertions were made of misleading or deceptive conduct in a form of breach of duty to Labocus and otherwise rights said to lead to entitlement to the land. 86 In my view the application should be dismissed and the applicants should pay the costs of the respondents, that is Mr Thomas and the Naylors. I see no basis for any application for those costs to be paid other than on the usual basis of party/party costs. That will not fully recompense either Mr Thomas or the Naylors. Dealing with the Naylors, they are parties to the litigation and in my view I see no basis to treat them other than as parties. They can have their costs on the relevant applications on that usual basis. 87 As to Mr Thomas, he was the trustee of the bankruptcies and he is now the trustee of the composition. My view is that he should not be able to take the balance of his costs, let alone any remuneration, out of funds otherwise available to creditors. Again, may I emphasise that it is unfortunate that I have to deal with the matter as I do and I make no personal criticism of Mr Thomas in saying this, but to a degree this has been his fault. Although I think that the application should be dismissed, I do not think on the day (11 May 2007) that he served his creditors as well as he could have and I do not think the creditors should be disadvantaged in that respect by in any way funding the difference between party/party and other costs, let alone remuneration from the assets otherwise due to them. 88 The orders that I propose to make are that the first respondent bring in short minutes of order reflecting the draft orders that I am about to propose. If there is any argument as to the proper form of the order or any other proper order about the terms of the order as proposed, or to the substance of my reasons which would include any view that I have overlooked any particular issue, I will hear those argument as soon as possible. 4. 90 The order I would like Mr Thomas and his advisers to think of, and it may be that it is not necessary if an appropriate undertaking is given, that Mr Thomas as the first respondent not seek reimbursement from the estate or the creditors without the leave of the Court, such leave being only based on the fully-informed consent of the creditors or any of them that they are willing to see their share of the proceeds diminished by any further return to Mr Thomas based on the difference between party/party and solicitor/client costs or remuneration. 91 I will order that the first respondent cross-claimant bring in short minutes of order having circulated to the parties. | application to set aside composition bankruptcy |
2 The applicant, Biago Giovanni Iacono, was a tax agent whose registration under Part VIIA of the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act ") was suspended pursuant to s 251K(2) of that Act by the Tax Agents' Board of Victoria ("the Board"). Mr Iacono sought review of that decision in the Tribunal which in turn affirmed the Board's decision. 3 Subdivision H of Part VIIA of the 1936 Act has two separate regimes for the cancellation or suspension of a tax agent's registration. Section 251K(1) stipulates that in specified circumstances the Board shall suspend or cancel the registration of a tax agent and in such a case by virtue of s 251K(3B) the period of such a suspension "shall not be less than three months". That particular regime had no application in Mr Iacono's case. His suspension was effected under s 251K(2) which granted the Board a power to suspend or cancel the registration of a tax agent upon being satisfied that one of a number of stipulated matters had been demonstrated to it. Where the Board has determined that a registration should be suspended, s 251K(3) provides for present purposes "a suspension of the registration of the tax agent shall be for such period as the Board concerned thinks fit". 4 As the Tribunal recognised in its Reasons for Decision, the most important issue in the case was whether the correct decision had been made in suspending Mr Iacono's registration, i.e. the s 251K(2) question. In reaching its conclusion on this matter, the Tribunal found that the requirement of s 251K(2) had been satisfied and "accordingly the discretion exercised by the Board to suspend Mr Iacono's tax registration for a period of three months is appropriate". The Tribunal's decision to suspend is not presently in issue. However, s 251K(3B) of the ITAA provides that the period of suspension under subsection (1) shall not be less than three months. 6 The Tribunal's decision was handed down on 17 February 2006. On 28 February 2006 an employee of the Australian Government Solicitor (which represented the Tax Agents' Board of Victoria before the Tribunal) wrote to the Deputy Registrar of the Tribunal noting what was said at [26] of the Reasons for Decision. The letter went on to observe "while our client agrees with the Tribunal's stated view of the operation of s 231K(3B) of the Income Tax Assessment Act 1936 ... in the factual circumstances of this matter, this provision had no application". By letter dated 28 February 2006, the respondent's representative notified the Tribunal that there is an error in its reasons for decision. In my opinion, a period of three months is appropriate in this case. As Mansfield J said in Comcare v Moon (2003) 75 ALD 160 at [65]: "There is power to correct obvious errors in the text of a decision or the reasons under s 43AA , but not to reverse or vary the decision ... Matters of expression, or inconsistency or error in calculation, could be corrected in s 43AA , but not the decision itself. 11 There was a palpable jurisdictional error in this matter. The Tribunal simply did not address, as it was required to, what was the appropriate suspension under s 251K(3). This being the case that part of the decision is open to be set aside and remitted to the Tribunal for re-determination. Nonetheless the respondent Board has contended that the Tribunal has indicated in the Direction that if it had properly directed itself when making its decision it would have affirmed the Board's decision in any event. So it is said I should exercise my powers under s 44 of the AAT Act to affirm the Tribunal's decision: on the taking of such a course, see generally the decision of Sackville J in Morales v Minister for Immigration and Ethnic Affairs (1995) 60 FCR 550 at 560 ff. This is not a course that I am prepared to take in this matter. 12 When the Tribunal made its decision imposing the suspension that it did, it clearly did so on an improper basis and rejected categorically the applicant's submission by reason of that basis. It would, in my view, do nothing to enhance public confidence in the administration of this part of the Income Tax Assessment Act if the Tribunal having committed a palpable error, was permitted to retrieve its position by later giving a direction not authorised by s 43AA but which in turn, for Morales purposes, would have the effect of rendering remittal futile. No encouragement should be given to misusing s 43AA to such an end. It may well be the case, when the Tribunal reconsiders how it should exercise its discretion in relation to the length of the suspension, that it will arrive at the same decision. Be this as it may, I am not satisfied that that is a necessary or inevitable outcome once the Tribunal properly directs itself in relation to that question and in light of the submissions made to it on that matter: see Santa Sabina College v Minister for Education (1985) 58 ALR 527 at 540. 13 Accordingly, I have made the orders noted at the outset of these reasons. I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn. | appeal from decision of administrative appeals tribunal applicant's registration suspended under s 251k(2) of income tax assessment act 1936 (cth) applicant sought review of decision in tribunal tribunal affirmed decision to suspend registration period of suspension determined inappropriately in reliance on s 251k(3b) period to be determined under s 251k(3) tribunal alerted to error in application of s 251k(3b) after reasons delivered tribunal corrected determination under s 43aa of administrative appeals tribunal act 1975 (cth) eliminating reference to s 251k(3b) whether proper use of s 43aa whether tribunal committed jurisdictional error whether court should affirm decision notwithstanding jurisdictional error administrative law |
His Honour ordered that further proceedings in the matter be stayed until the Victorian Civil and Administrative Tribunal (VCAT) had determined whether an administrator or guardian, or both, should be appointed for the applicant pursuant to a referral to VCAT by the County Court of Victoria under s 66 of the Guardianship and Administration Act 1986 (Vic). In the substantive proceeding the applicant seeks relief under the Human Rights and Equal Opportunity Commission Act 1986 (Cth) for alleged racial discrimination. 2 At that stage his Honour had already reserved judgment on a question relating to the continuation of legal representation engaged by the first respondent. There was also a pending application by the first and second respondents to have the whole proceeding dismissed. However, in granting the stay his Honour decided in effect that those questions should await the hearing and determination of the matter before VCAT: see [15]-[16]. 3 I do not detect any error in the exercise of his Honour's discretion to grant the stay. It does not appear that his Honour has taken into account any irrelevant consideration, or failed to take into account any relevant consideration. His Honour's decision on its face is not unreasonable; indeed, in my respectful opinion, it appears eminently sensible and its correctness is not open to doubt. The question of the proper representation of the applicant should be decided according to the law of Victoria which has now been invoked. There would be no reasonable prospect of success for the proposed appeal, and in such event leave should be refused. 4 It should be noted that the matter has been somewhat complicated by events after his Honour's decision. On 3 January 2007, on the ex parte application of the applicant, Bell J in the Supreme Court ordered that the Registrar of the County Court, amongst others, be restrained from participating in the VCAT proceeding. When the matter came on for hearing in VCAT on 10 January 2007 there was no appearance on behalf of the Registrar and the matter was accordingly dismissed. It appears from a letter from the Office of the Victorian Government Solicitor dated 30 January 2007 that the Registrar of the County Court will be applying in the Supreme Court to dissolve or vary the order of Bell J and then, subject to the outcome of that application, will apply to VCAT to revoke the order dismissing the VCAT proceeding. 5 The applicant asserted from the bar table that she had been told by Middleton J's Associate that the present application to the Court (VID 855 of 2006) would be "automatically reinstated". There is no verification of that assertion and it is not necessary for me to explore it because there can be no doubt that, until set aside or varied, Middleton J's stay order is operative. The events in January having occurred subsequent to his Honour's order they cannot affect its validity. In any event, it seems a matter of commonsense to wait until the procedures in the Victorian courts have worked out their proper course before this matter can resume. 6 The other matter before the Court is a notice of motion, dated 30 January 2007, brought by the applicant. She seeks orders that the proceeding VID 855 of 2006 be reinstated, that Middleton J stand down from hearing the matter further, that Russell Kennedy Lawyers "are removed from acting in the matter", that motions issued by Russell Kennedy with respect to VID 855 of 2006 "cannot affect future proceedings and must be put aside" and that the jurisdiction of the Court in the matter VID 855 of 2006 be "extended by adding relevant and criminal jurisdiction". 7 As I have already mentioned, the stay order is valid and operative, and that means that the notice of motion, being a further step in the proceeding, cannot be brought. It should be mentioned, of course, that it is entirely inappropriate to attempt to challenge the jurisdiction of one judge before another single judge. So the application for leave to appeal will be dismissed with costs, and the notice of motion dated 30 January 2007 will be dismissed with costs. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey. | application for leave to appeal from interlocutory decision practice & procedure |
In relation to the assets of those respondents and also the fifth respondent referred to in a Notice of Motion filed 11 May 2009, freezing orders have been sought by the applicant under Order 25A rules 5(4) and 5(5) of the Federal Court Rules to prevent an abuse or frustration of the process of the Court in respect of the primary claims for relief. In relation to applications such as this, I would refer to the applicable principles as summarised by me in Ron Medich Properties Pty Ltd v Bentley-Smythe Pty Ltd (No. 3) [2009] FCA 335 ('Medich') at [10]-[24]. None of the parties to whom this judgment relates submit that the summary of the principles in Medich contains any errors. On 19 May 2009 freezing orders were made by consent and without admissions against the second respondent restraining him from removing from Australia or in any way disposing of, dealing with or diminishing the value of his Australian assets up to the unencumbered value of $A 3,519,120.99 other than to make a payment to the applicant. The relevant freezing order also provided that if the unencumbered value of the second respondent's Australian assets was less than the said amount and he had assets outside Australia, he was also restrained from disposing of, dealing with or diminishing the value of his Australian assets and his ex-Australian assets up to the unencumbered value of the said amount. It is necessary to turn to the precise terms of the order to identify the ambit of the restraint which was imposed upon the second respondent. In defining the assets of the second respondent to which the restraint applied paragraph 6(1)(c)(ii) of the orders defined 'your assets' as including 'the sum of AUD$220,000' held in ten bank accounts in New Zealand (eight at ANZ National Bank Limited and two at Bank of New Zealand) in the name of the fifth respondent. There is no evidence as to the amount standing to the credit of those accounts and, for reasons which will shortly appear, there are, so it would seem, other claims upon the monies standing to the credit of some or all of the bank accounts mentioned in the said orders. On 22 May 2009 freezing orders were made by consent and without admissions against the first and fourth respondents. The orders made against the first respondent restrained him from removing from Australia or in any way disposing of, dealing with or diminishing the value of his Australian assets up to the unencumbered value of $A 35,807,867.41 other than to make payment to the applicant. Once again the orders extended to assets of the first respondent outside Australia if the unencumbered value of his Australian assets fell below the said amount in which case the restraint extended to both the first respondent's Australian assets and his ex-Australian assets up to the unencumbered value of the said amount. In paragraph 6(1)(c)(ii) of the freezing orders against the first respondent his assets were defined as including '[t]he sums of US $32,142.56 and AUD $14,263,136.36' held in the same ten bank accounts in New Zealand in the name of the fifth respondent. The freezing orders made in respect of the assets of the fourth respondent restrained it from removing from Australia or in any way disposing of, dealing with or diminishing the value of its assets in Australia up to an unencumbered value of $A 6,151,624.64 other than to make payment to the applicant. Once again the freezing orders extended to assets outside Australia in the event that the unencumbered value of the fourth respondent's Australian assets was less than the said amount in which case the restraint applied to both Australian and ex-Australian assets up to the unencumbered value of the said amount. Once again paragraph 6(1)(c)(ii) of the freezing order defined the assets of the fourth respondent to which the restraint applied as including 'the sums of US$32,142.56 and AUD$14,263,136.36' held in the ten bank accounts in the name of the fifth respondent to which reference has already been made. Presumably, given the identical amounts, the applicant is contending that the assets of the first respondent are also the assets of the fourth respondent. Resolution of the differences between the applicant and the first, second and fourth respondents in respect of the applicant's Notice of Motion filed 11 May 2009 has left for determination, the claims for freezing orders against the third respondent, a party to the proceedings, and the fifth respondent as a 'third party' against whom freezing orders have been sought. On 11 May 2009 the duty judge made freezing orders against each of the first, second, third, fourth and fifth respondents up to and including 5:00pm on Friday 15 May 2009 but those orders lapsed on that day. The applicant's Notice of Motion came before me for hearing as the docket judge on 19 May 2009, 20 May 2009, 22 May 2009, 1 June 2009 and 5 June 2009. On 20 May 2009 the third and fifth respondents by their counsel without admissions and without prejudice to any entitlement to resist the making of a freezing order gave to the Court an undertaking that the third and fifth respondents would take no steps which may be open to them to dispose of or otherwise deal with their assets restrained by the orders made by Hislop J in the Supreme Court of New South Wales on 25 October 2008 in proceeding No. 12212 of 2008 in the Common Law Division, without first giving 14 days' notice to the applicant. It was noted that the undertakings proffered were given severally by the third and fifth respondents. At the commencement of the day on 22 May 2009 separate undertakings to the Court were formally given by the third and fifth respondents. Later on the same day the undertakings were further extended to be expressed as undertakings to the Court on behalf of the third respondent, its directors and officers and, later still, on behalf of the third respondent, its directors and other officers, servants and agents in the one case and on behalf of the fifth respondent its directors and officers and, later still, on behalf of the fifth respondent, its directors and other officers, servants and agents on the other. On 22 May 2009 the evidence had not concluded. In all the circumstances, freezing orders were made on that day against each of the third respondent and the fifth respondent in each case up to and including 1 June 2009. On 1 June 2009 those freezing orders were continued up to and including 5 June 2009. The restraint in respect of the third respondent precluded it from removing from Australia or in any way disposing of, dealing with or diminishing the value of any of its assets in Australia up to the unencumbered value of $A 3,597,587.90 other than to make payment to the applicant. Once again the orders were expressed to extend to assets of the third respondent outside Australia in the event that the unencumbered value of the Australian assets was less than the said amount. In those circumstances the restraint was expressed to apply to the third respondent's Australian assets and its ex-Australian assets up to the unencumbered value of the said amount. In the freezing order as made the assets of the third respondent were defined in paragraph 6(1)(c)(ii) to include ' the whole of the amounts held in the following bank accounts in New Zealand', those accounts being the same ten bank accounts in the name of the fifth respondent to which reference was made in the earlier orders against the first, second and fourth respondents. The freezing orders made on 22 May 2009 against the fifth respondent up to and including 1 June 2009 and continued up to and including 5 June 2009 restrained the fifth respondent from disposing of, dealing with or diminishing the value of any of 'your Assets' and for that purpose 'your Assets' was defined to mean ' the whole of the amounts held in the following bank accounts in New Zealand' once again referring to the same ten bank accounts in the name of the fifth respondent. The applicant was not content to rely upon the undertakings to the Court given by the third and fifth respondents and pressed for the making of freezing orders by the Court until further order. When challenged to explain why a freezing order would provide the applicant with more effective relief than the undertakings given to the Court, it was suggested that the freezing orders would have a character analogous to a judgment in rem so that other parties, such as the banks mentioned in the definitions of 'your assets' in the orders previously made, would be bound to observe the orders if they were served upon them. Senior counsel for the applicant resiled from this position on 1 June 2009 but still maintained that the applicant would be placed in a stronger position were freezing orders to be made arguing, amongst other things, that notice of an intended withdrawal of one or other or both of the undertakings could be given to a remote office of the applicant and not come to the relevant officer's attention until, metaphorically speaking, the horse had bolted. This last mentioned concern was overcome by the addition of the words mentioned above to the third and fifth respondents' respective undertakings to the Court on 5 June 2009. Pending the delivery of my reasons for judgment on the applicant's Notice of Motion filed 11 May 2009, the freezing orders have been progressively extended. On 2 July 2009 they were continued up to and including Friday 10 July 2009 or earlier order. The third and fifth respondents have conceded, for the purposes of the Notice of Motion presently before the Court, that the Commissioner has shown an arguable case. The 'first limb' requirement that the applicant establish a prima facie cause of action against the respondent, has been satisfied. However, the third and fifth respondents submitted that not only was there no danger of dissipation of assets, there was absolutely no risk of dissipation. It seems to me that there is something of a problem with the applicant's assertion that at one and the same time monies standing to the credit of bank accounts in the name of the fifth respondent with ANZ National Bank Limited and Bank of New Zealand can be wholly the property of the third respondent, wholly the property of the fifth respondent, and at the same time, the property of the second respondent as to $A220,000, the property of the first respondent as to $US32,142.56 and $A14,263,136.36 and the property of the fourth respondent as to like amounts namely $US32,142.56 and $A14,263,136.36. As mentioned above, there is no evidence as to the current balances of the ten bank accounts nor is there any evidence of the claims that the first, second, third or fourth respondents or others might have on the fifth respondent in respect of the moneys standing to the credit of the said accounts or otherwise. The Banks are not trustees of the monies standing to the credit of the fifth respondent's accounts. Each of them is simply a debtor of the fifth respondent for the whole of the amounts standing to the credit of the accounts with them from time to time (see per Campbell J in Sutherland Re; French Caledonia Travel Service Pty Ltd (In Liq) [2003] NSWSC 1008 ; (2003) 59 NSWLR 361 (the 'Travel Service case') at [61]). In Re Hallett's Estate: Knatchbull v Hallett (1880) 13 ChD 696 ('Re Hallett's Estate') is not authority for the proposition for which the applicant contends, namely, '[t]he mixing or pooling of the monies in the New Zealand account (sic) does not create an "indistinguishable mass" which precludes equitable ownership being asserted in respect of an aliquot amount that represents the sum of monies owned by any particular person. ' In Re Hallett's Estate, Mr Hallett, a solicitor, acting without authority and improperly sold some Russian 5% 1822 bonds. Some of those bonds represented trust funds under a marriage settlement of Mr Hallett. Others were held by him for a client, Mrs Cotterill. The bonds had been sold by Hallett directing his bankers, Messrs Twining, to do so. Hallett had drawn monies from the account with his bankers and paid in other monies. In an action for the administration of his estate following his death, claims were made by several persons against monies in the hands of the bankers. The Master of the Rolls then proceeded to reject Lord Ellenborough's statement in Taylor v Plumer [1815] EngR 551 ; (1815) 3 M& S 562 ; (1815) 105 ER 721 which followed 'the means of ascertainment fail', namely 'which is the case when the subject is turned into money, and mixed and confounded in a general mass of the same description. ' The Master of the Rolls opined that in such circumstances equity could follow the money and create a charge. Employing this refinement, the means of ascertainment would, in equity, still remain. For it would be a great mistake to suppose that the great case of Re Hallett's Estate ... lays down a doctrine peculiar to money. On the contrary, it extends to money paid into a bank account, and so losing its identity as money, a doctrine which equity would never have had the slightest hesitation in applying to money physically existing or to any other kind of personal property to which it could, as a matter of practical possibility, be applied. And there is no difficulty, and we do not think equity would ever have had the least difficulty, in applying the same doctrine to shares or bonds. The simplest case put is the mingling of trust moneys in a bag with money of the trustee's own. Suppose he has a hundred sovereigns in a bag, and he adds to them another hundred sovereigns of his own, so that they are commingled in such a way that they cannot be distinguished, and the next day he draws out for his own purposes £100, is it tolerable for anybody to allege that what he drew out was the first £100, the trust money, and that he misappropriated it, and left his own £100 in the bag? It is obvious he must have taken away that which he had a right to take away, his own £100. What difference does it make if, instead of being in a bag, he deposits it with his banker, and then pays in other money of his own, and draws out some money for his own purposes? Could he say that he had actually drawn out anything but his own money? His money was there, and he had a right to draw it out, and why should the natural act of simply drawing out the money be attributed to anything except to his ownership of money which was at his bankers. It is instructive to consider the excellent, if I may say so, critique of Re Hallett's Estate which is to be found in the judgment of Campbell J in the Travel Service case at [43]-[65] although I am not persuaded that, as a matter of generality, coins in a bag may be treated as 'separate and individually identifiable things'. Money, like grain, is fungible and, generally speaking, indistinguishable (cf per Campbell J at [61]). However, the distinction remains between money as a chose in possession and a banker's obligation to the bank's customer, which his Honour rightly described as an inchoate chose in action. Functionally, the bank account and coins in the bag operated identically. Tracing money into a bank account and obtaining a charge over an identifiable part of it may be impracticable. As to how competing claims on the fifth respondent in respect of monies standing to the credit of the bank accounts with ANZ National Bank Limited and Bank of New Zealand, if there be such competing claims, are to be dealt with will, no doubt, turn on a number of facts, that are presently unknown. It cannot be said that, as a matter of law, a fund in which assets of several beneficiaries have become mixed should always be distributed amongst all beneficiaries, pro rata according to their claims. Rateable abatement does not automatically apply whenever there is a mixed fund because there is a preliminary question, the answer to which cannot be assumed, of whether all the claimants on the fund, in the form the fund takes at the time of trial, have claims which are equal (see per Campbell J in the Travel Service case at [176]-[193]). On 5 May 2009 a Notice of Assessment was issued to the third respondent under the Income Tax Assessment Act 1936 (Cth) ('the 1936 Act') and the Income Tax Assessment Act 1997 (Cth) ('the 1997 Act') in respect of the year of income ending 30 June 2008. That Notice of Assessment recorded that the Commissioner had made an assessment of the amount of the taxable income of the third respondent in the sum of $1,980,080 and of the tax payable thereon, being $594,024.00. The Notice of Assessment also recorded that $1,129,991.56 was payable by the third respondent to the Commissioner from previous notices. The previous notices which gave rise to the figure of $1,129,991.56 were Notices of Assessment issued on 5 May 2009 to the third respondent in respect of the years of income ended 30 June 2001, 30 June 2002, 30 June 2003, 30 June 2004, 30 June 2005, 30 June 2006 and 30 June 2007. And, by a letter dated 6 May 2009 the third respondent was advised that a General Interest Charge had been imposed on an amount that was overdue. To 4 May 2009 the General Interest Charge imposed was $322,046.76. By a Notice of Appearance filed 13 May 2008 the third and fifth respondents who gave their address as 'First Floor, PKF House, Lini Highway, Port Vila, Vanuatu' appeared conditionally. The conditional appearance was superseded by an unconditional Notice of Appearance filed on 21 May 2009. Freezing orders are sought in respect of the New Zealand bank accounts which nominate [the fifth respondent] as account holder. Mr Sophocles was not aware of what assets the fifth respondent had in Australia, in Vanuatu or elsewhere in the world. Similarly, he was unaware of what assets the third respondent had in Australia, in Vanuatu and elsewhere in the world. The Court was not invited to consider in any detail the documents which were produced. However, it was observed that copies of many of the documents produced by the third respondent were also produced by the fifth respondent. Many of the documents so produced had a heading which included 'IFTC Limited' which I understand to be a reference to the fifth respondent, International Finance Trust Company Limited. Mr Sophocles gave evidence that the documents produced in answer to both notices were identical except for the third respondent's response to the paragraph number 2 dealing with share ownership. When asked about the production of journals, by way of example, Mr Sophocles gave evidence that no hard copies of journals were produced nor were photocopies of such books. Not in the traditional sense of a journal, but as those things are now stored electronically by accountants. Mr Sophocles gave evidence that the third and fifth respondents were each Vanuatu companies. The address given for each of the third and fifth respondents in the Notices of Appearance was the same address as that of 'PKF Chartered Accountants & Business Advisers' of Vanuatu namely First Floor, PKF House, Lini Highway, Port Vila, Vanuatu. A letter written by Robert F. Agius as a partner of PKF Chartered Accountants & Business Advisers to Mr Martin Woods, a solicitor for the first respondent in Sydney on 26 January 2008 reveals that the 'Resident Partners' at that time were 'Robert Agius, B.Com, M.B.A., F.C.A., Andrew Neill, B.Bus. A.C.A., A.S.I.A., Iain Johns, B.Bus, M.B.A., C.P.A. ' Following the disclosure of the names of the 'Resident Partners' the stationery disclosed: 'The PKF International Association is an association of legally independent firms'. The four page letter sent by Mr Agius to Mr Woods was headed ' International offshore structures '. This ensures that it is not caught by the FIF or the CFC rules in the Australian taxation act. Why this is so and how this is carried out is that the CLG after going through the liquidation procedure the Constitution the company has it mandatory (sic) that the Appointor and the Guardian must advise the liquidator and (sic) what to do with the distribution on the windup. The same people operate the bank accounts of a New Zealand finance company, Nelson Finance and Leasing Ltd. ('Nelson') I would suggest that the appropriate entity to have forwarded funds to your trust account is Nelson. I would suggest that loans be set up for each of the individuals in Australia who have received the money from your trust account so as to identify a source of funds which is capital in nature and recorded as such. The Appointor and Guardian will require some guidance in how (sic) these are to be dealt with and whether they should be transferred to the Singapore Company or the new CLG. The cover page of the Constitution refers to the 'International Companies Act No. 32 of 1992' of the Republic of Vanuatu. It identifies the company as a 'private company limited by guarantee' and records the name of the fifth respondent on the foot of the cover page with the address 'PKF House, Lini Highway, Port Vila, Vanuatu' and the E-mail address '[email protected]'. (1) The Company is limited by guarantee. The Appointor may by notice in writing nominate a successor who shall thereupon be the Appointor, provided this nomination is confirmed in writing by both the Registered Agent and the Guardian. Should any such Appointor die or otherwise become incapable of acting before nominating a successor, the Registered Agent is empowered to appoint a person to the office of Appointor provided this appointment is confirmed in writing by the Guardian. The Appointor may be removed from office by notice in writing signed by both the Registered Agent and Guardian. The Guardian may by notice in writing nominate a successor who shall thereupon be the Guardian, provided this nomination is confirmed in writing by the both (sic) the Registered Agent and the Appointor. Should any such Guardian die or otherwise become incapable of acting before nominating a successor, the Registered Agent is empowered to appoint a person to the office of Guardian, provided this appointment is confirmed in writing by the Appointor. (1) The Company shall at all times have a registered office and registered agent in Vanuatu. (1) The first directors shall and any subsequent directors may be appointed by the members for such term as they may determine. (1) Each Incorporator of the Company shall be a member of the Company until such other persons are admitted to membership in accordance with this Constitution at which time the Incorporator or Incorporators shall cease to be members unless their membership is approved in writing by the Appointor and confirmed in writing by the Guardian. 32 of 1992 of the Republic of Vanuatu on 22 November 1999 and changed its name on the same day to IFTC Broking Services Ltd. It would appear that as at 7 June 2000 the third respondent had as a director Astrolabe Limited. On that day Mr Andrew Neill appears to have signed a letter on behalf of Astrolabe Limited, as 'director of IFTC Broking Services Limited' to the Manager of Commonwealth Securities Limited in Sydney. The address shown on the letterhead was 'Moore Stephens House, Kumul Highway, Port Vila, Vanuatu, South Pacific'. By letter dated 12 October 2005 the fifth respondent whose registered address was shown as '1 st Floor, PKF House, Lini Highway, Port Vila, Vanuatu', wrote to the New Accounts Department at ANZ Bank (Vanuatu) Limited forwarding certain documentation to open an AUD Bank Account for Iron Investments Ltd. The names of the authorised signatories were Robert F. Agius, Andrew Neill, Iain D. Johns, Allan J. McLeish, Kelly Fawcett and Neil G. Fontin. Mr Sophocles gave evidence that he received instructions for the third respondent and the fifth respondent in the current proceedings from Andrew Neill, Kelly Fawcett and Robert Agius. Mr Sophocles said that Ms Fawcett was described as 'a manager'. He believed her to be a resident of Vanuatu. On 6 June 2007 the fifth respondent wrote a letter to a Sydney stockbroker BBY Limited under the heading ' Iron Investments Limited (Formerly IOS MANAGEMENT LTD) '. The evidence included minutes of a meeting of the Incorporators of Iron Ore Sales and Management (HK) Ltd held at PKF House, Lini Highway, Port Vila, Vanuatu on 10 November 2004. Those present were shown as Diana Garae and Jenny Albert. The minutes included a note that the first 'Registered Agent' appointed by the Constitution (sic) was 'International Finance Trust Company Ltd [the fifth respondent] of PKF House, Lini Highway, Port Vila, Vanuatu'. It was resolved that such appointment 'be and is hereby confirmed'. However they do give a clear indication as to the manner in which PKF in Vanuatu operated and the apparent involvement of Astrolabe Limited as a corporate director and of Astrolabe Nominees Limited as a corporate secretary of various corporate entities. The 12 October 2005 letter sent by the fifth respondent to the New Accounts Department at ANZ Bank (Vanuatu) Limited was signed by Mr Iain Johns and not simply by him as an authorised signatory of Astrolabe Limited. On 6 February 2006 the first respondent completed a 'Memorandum of Wishes' which was directed to 'The Director' of the fifth respondent. The first respondent's signature on that document was witnessed by his solicitor, Mr Martin Woods of Sydney. The Memorandum of Wishes related to Iron Investments Limited. This Memorandum is intended for the guidance of you and any subsequent director or directors. It has no legal effect and it is not intended in any way to fetter the powers vested in you under the constitution of the said Company [Iron Investments Limited] Furthermore, it may be revoked by me by another Memorandum at any time during my lifetime and thereafter by my legal personal representative or representatives. By a letter dated 19 May 2006 the fifth respondent wrote to Commonwealth Bank of Australia ' Re: IFTC Broking Services Limited A/c 10980897 '. The letter was signed for the fifth respondent by Allan J McLeish, Andrew Neill and Kelly Fawcett as authorized signatories. The letter sought the payment out of the account of the third respondent of $A92,709.27 to 'Rick Damelien Prestige Sales' under reference 'Payment for MGG Capital [MGG Capital Pty Ltd as trustee for Webtel Management Super Fund is the fourth respondent]'. By the letter dated 6 June 2007 the fifth respondent thanked BBY Limited for effecting a sell order of 300,000 shares in Murchison Metals Ltd at $4.15. The letter requested the issue of a contract note. The letter was written under the heading 'Iron Investments Limited (Formerly known as IOS MANAGEMENT LTD)' as indicated above. A request was made that the proceeds of sale be remitted to ANZ Banking Group (NZ) Limited in Auckland New Zealand for credit to the account of the fifth respondent No 295659-AUD-00001 (one of the ten bank accounts referred to above --- in fact at ANZ National Bank Limited). On 17 October 2008 Robert Stewart, a partner in Izard Weston Lawyers, a New Zealand solicitor for the fifth respondent, sent an email to [email protected] under the heading 'International Finance Trust Company Limited'. Once the accounts are unrestrained my client wishes to issue certain instructions to the bank regarding the transfer of funds. In particular, will the bank accept faxed instructions from authroised (sic) signatories for transfers of sums less than NZ$1,000,000 in value, or will signed originals be required? On 12 November 2008 Atanaskovic Hartnell Lawyers, the Sydney solicitors for the third and fifth respondents, wrote to the Commonwealth Attorney-General's Department requesting that it 'issue a request to the Attorney-General of New Zealand to cancel [certain restraining orders registered in the High Court of New Zealand] forthwith'. On 19 December 2008 orders were made by A D MacKenzie J, which were entered on 22 December 2008, in the High Court of New Zealand, Wellington. Those orders cancelled the registration of two earlier foreign restraining orders made by the Supreme Court of New Zealand on 13 and 16 May 2008 which had been registered by the High Court of New Zealand on 21 and 22 May 2008 respectively (and varied by order dated 16 June 2008). However, his Honour also registered in New Zealand a new foreign restraining order made by the Supreme Court of New South Wales on 25 October 2008 in relation to the ten New Zealand bank accounts in the name of the fifth respondent that were referred to above. In the foregoing circumstances, the question is what, if any, relief should the Court grant? In due course the Commissioner may be able to seek assistance in the collection of tax that is said to be due by the first, second, third and/or fourth respondents, pursuant to Article 27 of Schedule 4 to the International Tax Agreements Act 1953 (Cth) (see, in particular, clauses 1 and 3 of Article 27). The applicant presses for what one might call 'belt and braces' freezing orders in respect of the assets of the third and fifth respondents, notwithstanding that he already has the derivative benefit of the orders made by the High Court of New Zealand on 19 December 2008 and entered on 22 December 2008 on the application of the Solicitor-General for New Zealand pursuant to ss 56 and 58 of the Mutual Assistance in Criminal Matters Act 1992 (New Zealand) which were founded upon orders made on 25 October 2008 by Hislop J in proceedings brought by the New South Wales Crime Commission in the Supreme Court of New South Wales. The orders of the High Court of New Zealand were made in proceedings in which the respondents included the fifth respondent, the second respondent and the first respondent to the Notice of Motion presently before this Court and also the New Zealand banks, namely, ANZ National Bank Limited and Bank of New Zealand. The applicant also has the benefit of the undertakings given to the Court by the third and fifth respondents to the current Notice of Motion as noted above. Just as freezing orders, if made, would operate as a very tight 'negative pledge' species of security over property, to which the contempt sanction is attached, like sanctions would be available were the undertakings to this Court breached. As yet no money judgments have been obtained by the applicant although applications for summary judgment against the first, second, third and fourth respondents are presently listed for hearing on 13 July next. It appears that both the third respondent and the fifth respondent are foreign companies incorporated in Vanuatu. They each appear to have a sole corporate director although that corporate director acts by a variety of 'authorized signatories'. It seems to me that those who act or have acted as directors, officers, servants or agents of the third respondent and/or the fifth respondent are as much at risk under the undertakings that have been given to the Court as they would be under freezing orders that may be made in respect of the assets of the third and fifth respondents at this stage. The fifth respondent is, of course, not a party against whom the applicant seeks to obtain any money judgment. In the exercise of my discretion, I do not consider that further freezing orders should be made in respect of the assets of the third and fifth respondents at this stage. I am mindful of the terms of Mr Stewart's email to Aaron Lyne of 17 October 2008, but, since then another restraining order has been made which has been registered in the High Court of New Zealand, the third and fifth respondents have each appeared unconditionally in these proceedings and they have each given undertakings to this Court in the terms indicated above. In my opinion, the applicant's application for prayers for relief 4 and 6 in the Notice of Motion filed 11 May 2009 should, in all the circumstances, be dismissed. However, given the progression of the matter, and the timing of the giving and amplification of the undertakings to the Court by the third and fifth respondents, I consider that the third and fifth respondents should, nevertheless, be ordered to pay one quarter of the applicant's costs of the motion. It will be appreciated that the costs of the motion as between the applicant and the second respondent have been reserved, as have the costs of the motion as between the applicant and the first and fourth respondents. I will delay the implementation of the order as to costs which I have proposed, to allow oral submissions thereon to be made, should any of the applicant, the third respondent or the fifth respondent wish to do so, within the next 7 days. In that regard I reserve liberty to apply. I certify that the preceding seventy-eight (78) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Graham. | application for mareva relief in respect of assets of foreign corporations undertakings proffered to the court consequences of the mixture of funds of several parties in an indistinguishable mass injunction equity |
It was convenient to follow this course because the applicant sought, and had been granted leave, to rely on the same evidence which had been tendered in the Dunn case in this proceeding and because, apart from two additional matters, the same grounds and argument as had been advanced in Dunn were pursued in this case. Dunn was concerned with a challenge to the lawfulness of a request, made by a delegate of the Commonwealth Attorney-General, to Swiss authorities. The request was made under the Mutual Assistance in Criminal Matters Act 1987 (Cth) ("the Mutual Assistance Act") and the Treaty between Australia and Switzerland on Mutual Assistance in Criminal Matters done at Berne in Switzerland on 25 November 1991 ("the Treaty"). It asked the Swiss authorities to obtain and execute search warrants to seize documents which were sought in relation to an investigation known as "Operation Wickenby". The mutual assistance request suggested that relevant documents might be found in the applicant's premises in Switzerland upon the execution of search warrants. The grounds of the present application which are common to the grounds relied on in Dunn are that: Necessary preconditions (under the statutory regime and the Treaty) for the making of a valid application for assistance under the Mutual Assistance Act were not observed. The request misstated a number of important facts. The involvement of the Commonwealth Director of Public Prosecutions in the making of the request was unlawful. The involvement of the Australian Crime Commission ("the ACC") and the making of the mutual assistance request was also unlawful. Each fails for the reasons given in Dunn. It is contended that: It was implied in the mutual assistance request that two persons, who were identified in that document as being subject to criminal investigation, were at relevant times Australian residents for taxation purposes when this was, in fact, not the case. A letter, written by solicitors, was wrongly described in the November letter as a "False or Fictitious Document[s] produced by Strachans SA. " The consequence was said to be that it was "invalid" and that it must, therefore, be set aside or quashed. Australian authorities are investigating a number of Australian residents for using companies, trusts and bank accounts administered by Strachans S.A., an accountancy services firm in Switzerland, to disguise their involvement in tax fraud schemes and money laundering. While in Australia, the ACC compelled Egglishaw to produce documents and his personal computer and to attend an ACC hearing to answer questions. From this, the ACC learnt that Strachans administers various companies, trusts and bank accounts based in foreign countries on behalf of, and for the benefit of, a number of Australian residents and their families. Each entity operated by Strachans is given a name and a four figure reference number. He is also a principal of the [S] group of companies located in Sydney, Australia. He has a number of clients who are very prominent in the film industry including [H] and [C], who he has been associated with since 1989. The applicant submits that these passages imply, contrary to the fact, that H and C were both residents of Australia between 1995 and 2005 for taxation purposes. The implication is said to arise from the distinction drawn, in paragraph 70, between E and S on the one hand and H and C on the other, suggesting that H and C are Australian residents because the overseas residency status of E and S is expressly referred to. A more general contention is also made, namely, that the mutual assistance request was made on an unstated premise that the persons who were the subject of allegations made in it were, at relevant times, Australian residents unless the contrary was expressly stated. The unstated premise is said to arise because, so it is said, offences of the kind alleged against H and C could not be committed by non-resident tax payers. Having considered the terms of the request, the Swiss authorities, by letter dated 10 October 2005, sought clarification of the residency status of both H and C. Specifically the question asked was "Do [H and C], had (sic) their residence in Australia and/or were they Australian taxpayers during the period for which the investigation is lead (sic)? As yet he has not lodged an Income Tax Return in respect of the 2005 year. While resident outside of Australia Mr [H] continued to be a director and shareholder in a number of Australian resident companies. As yet he has not lodged an Income Tax Return in respect of the 2005 year. While resident outside Australia Mr [C] continued to be a director and shareholder in a number of Australia resident companies. In Dunn at [45] to [52] I considered, and rejected, a submission that the Commonwealth Attorney-General was under an obligation, when making a mutual assistance request, to disclose to the Requested State all material facts relevant to the request. Given that any request would be made in the course of an investigation, I assumed that the alleged obligation could only extend to material facts known to the Requesting State at the time at which the request was made. For the reasons given in Dunn I do not consider that the Commonwealth Attorney-General was under an obligation to disclose to the Swiss authorities the residential status of H and C when making the request. The applicant may also be understood to have advanced the alternative submission that the mutual assistance request contained misleading information by implying that H and C were Australian residents when, in fact they were not. I do not accept these contentions. In the first place the contentions are founded on a mistaken assumption that H and C, had they not been Australian residents, could not have committed offences against Australian law. They were obliged to comply with Australian taxation law in respect to income sourced in Australia during the period of their non-residency. Secondly, H and C were resident, for taxation purposes, in Australia during at least part of the period covered by the investigation. That period, as the Swiss authorities were advised in the November letter, ran from 1 January 1995 to 31 May 2005. Thirdly, when the Swiss authorities sought further details about the residency of H and C, the Australian authorities advised that H and C had "declared" themselves to be non-residents for some (but not all) of the financial years falling within the period covered by the investigation. The applicant says that this information was correct. There is some ambiguity here because the Australian authorities did no more than tell the Swiss authorities what H and C had declared in their taxation returns. There can be no doubt that this information was uncontentious. I do not understand the Australian authorities to be asserting, as I think the applicant would have it, that the declaration was correct in fact and law. I also note that this part of the applicant's submission is at odds with the submissions made in Dunn that the November letter formed part of the request. If it did then the Swiss authorities were advised of the relevant information in the request. The second complaint, which is peculiar to the present application, is that, in the November letter, a letter dated 1 February 2005 from Barminco Investments Pty Ltd's legal advisers was wrongly described as a "False or Fictitious Document[s] produced by Strachans". The mutual assistance request advised the Swiss authorities that two of the persons, under investigation in Operation Wickenby were B and S. It was alleged (at paragraphs 94 to 100) that B and S were involved in fraudulent transactions which were devised for the purposes of defrauding the Commonwealth. In their letter of 10 October 2005 the Swiss authorities asked, in respect of the matters raised in the mutual assistance request concerning B and S: "Is it possible to have more details about the modus operandi used by [B and S] to defraud the Commonwealth? " In the part of the November letter headed "Status of Criminal Investigations" the Australian authorities responded to this request. They did so in a section of the document headed "False or Fictitious Documents produced by Strachans located in Australia". Immediately below this heading there was a subheading "Dunn" under which there were six paragraphs dealing with Mr Dunn. Three of those paragraphs are set out in the Dunn reasons at [12]. (See tab 25). Evidence obtained by the ACC confirms that $2,500,000 was to be paid to Dunn and the $800,000 to be paid to Dunn, [B and S]. The applicant correctly asserts that this letter was not a "False or Fictitious Document[s] produced by Strachans. " That may be accepted. What is in issue, however, is whether, on a fair reading, the November letter suggested that it was. I do not consider that the relevant passages can be so understood. Those passages are set out above at [13]. The reference to the 1 February 2005 letter makes it plain that that letter was sent by the legal advisors of Barminco Investments Pty Ltd to Strachans. As the next paragraph records, that letter was responsive to the matters raised by Strachans in its letter to Barminco's legal representatives dated 13 December 2004. The clear words of the text cannot be and are not varied merely because they appear under a general heading which suggests that Strachans created false and fictitious documents. No reasonable reader and, in particular the Swiss authorities, would have or could have so construed the plain words. Even had the applicant's proposed description of the solicitor's letter been correct, the wrong characterisation of one letter could not provide a ground for invalidating the request as a whole even if, contrary to my finding in Dunn , the November letter formed part of the request. The findings which I have made in relation to the grounds relied on in the application make it unnecessary to deal with these disputed issues. The application should be dismissed with costs. I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY. | application for request for assistance in a criminal matter to be declared invalid, set aside or quashed whether the request lawfully made whether the request was made by the attorney general (cth) or the attorney general's delegate whether the maker of a request is under an obligation to disclose all material facts whether alleged factual defects in the request rendered the request invalid whether reasonable grounds to believe the preconditions for making the request were satisfied whether inclusion of allegedly privileged material rendered the request invalid whether the involvement of the director of public prosecutions rendered the request unlawful whether the involvement of the australian crime commission rendered the request unlawful application dismissed administrative law |
On 23 March 2005 the Federal Magistrates Court made orders by consent quashing the decision and remitting it back to the Tribunal to be determined according to law. The Tribunal (differently constituted) affirmed the delegate's decision on 27 October 2005 ('the second Tribunal decision'). 3 In SZEYK v Minister for Immigration [2006] FMCA 1473 , Scarlett FM dismissed an application for review of the second Tribunal decision on the basis that it contained no jurisdictional error. Justice Lander dismissed an appeal from that decision ( SZEYK v Minister for Immigration and Citizenship [2007] FCA 133). The applicant sought special leave to appeal to the High Court ( SZEYK v Minister for Immigration and Citizenship [2007] HCATrans 640). 4 The applicant then commenced a second round of litigation challenging the second Tribunal decision. In SZEYK v Minister for Immigration [2007] FMCA 2095 , Emmett FM stated at [16] that the application was ' an abuse of this Court's process ' and ' unjustifiably vexatious and oppressive ' and ' likely to bring the administration of justice into disrepute '. 5 Justice Buchanan dismissed an appeal from her Honour's decision ( SZEYK v Minister for Immigration & Citizenship [2008] FCA 70). Once again, the applicant sought special leave to appeal to the High Court. Justices Kirby and Heydon dismissed the application as an appeal would have no reasonable prospects of success ( SZEYK v Minister for Immigration and Citizenship [2008] HCASL 378). In its decision dated 7 July 2008 ('the jurisdiction decision'), the Tribunal (which I may also refer to as the third Tribunal) held that it did not have jurisdiction to conduct a second review of the delegate's decision as that decision had already been the subject of a valid review by the Tribunal and was no longer an RRT---reviewable decision under s 411 of the Migration Act 1958 (Cth) ('the Act'). The applicant applied to the Federal Magistrates Court for a review of the jurisdiction decision. Federal Magistrate Smith dismissed the application. His Honour found that the application was ' plainly hopeless ' and dismissed it under r 44.12(1)(a) of the Federal Magistrates Court Rules 2001 (Cth). 7 In his application for leave to appeal, the applicant sets out a number of grounds. The grounds are also reflected in the draft notice of appeal and in the applicant's affidavit in support of his application for leave to appeal. It is not clear whether the grounds refer to the second Tribunal decision, which has twice been the subject of review by the Federal Magistrates Court, this Court and the High Court, or the jurisdiction decision. Those grounds that refer to the second Tribunal decision do not relate to the jurisdiction decision the subject of the decision of the Federal Magistrates Court from which the applicant wishes to appeal and have no prospects of success. 8 When asked to explain his grounds of appeal and the basis for his application for leave to appeal, the applicant reiterated his complaints about the second Tribunal decision. He repeated an assertion that the Tribunal had not asked him questions about his submissions and that it had made mistakes. He said that the Tribunal, in considering his application for a protection visa, made a mistake so he was entitled to ' have the case reconsidered again '. 9 That is simply not the case. The decision of the delegate that he seeks to have reviewed has already been reviewed at every level. An attempt to relitigate with respect to decisions that have been the subject of litigation and consideration up to the High Court and found to be free of jurisdictional error is an abuse of the process of the Court and vexatious and oppressive: SZCNP v Minister for Immigration and Citizenship [2008] HCASL 216 ; SZBPB v Minister for Immigration and Citizenship [2008] HCASL 164 ; MZXOW v Minister for Immigration and Citizenship [2008] HCASL 73. 10 The further application to the Tribunal was an impermissible attempt to relitigate the delegate's decision that had been the subject of review. The High Court confirmed the absence of jurisdictional error in the second Tribunal's decision. In these circumstances, the third Tribunal's duty was to assess whether it had jurisdiction before embarking upon a second or third review of the delegate's decision. 11 I turn to consider the grounds of appeal in the draft notice of appeal. The applicant was deprived of the natural justice and procedural fairness. This ground relates to the second Tribunal decision and not to the jurisdiction decision. 13 There are no particulars or evidence of the alleged bias or apprehension of bias and no basis for such allegations is apparent. The allegations in the third and fourth grounds regarding bias or apprehension of bias are unfounded. 14 I shall now consider the claims of denial of natural justice and procedural unfairness in respect of the jurisdiction decision. Federal Magistrate court decision is not correct either as the making of the decision was an improper exercise of the F.M court's judicial power. The applicant was denied the natural justice both from the RRT and the Hon. FM court. The applicant has been denied of procedural fairness. ... The decision of the F.M court was the breach of natural justice and there is no reason to make decision in favour of the respondent. 16 The applicant has filed an outline of written submissions in support of his application where he does not refer specifically to any of the grounds in the draft notice of appeal or the application for leave to appeal but addresses the ground of a denial of procedural fairness. He says that when he filed his present application to the Tribunal, he was issued with a letter and then received no further correspondence from the Tribunal and was not asked the reason for his repeated application. He says in his written submissions that he was expecting some kind of query from the Tribunal and that he was not given the opportunity to reply to any such query about the validity of his application. There is no evidence to support that assertion. He asserts that he was deprived of natural justice and that the Tribunal committed jurisdictional error. He submits that nothing in the Act suggests that the Tribunal is given authority to determine questions of law and that he was not given the opportunity to be heard as required by the Act. 19 Pursuant to s 414 of the Act, if a valid application is made under s 412 for review of an RRT-reviewable decision, the Tribunal must review the decision. The jurisdiction of the Tribunal is in respect of RRT-reviewable decisions. 20 A valid application for review has not been made. The application for a protection visa was refused by the Minister's delegate on 14 August 2003. The applicant was aware of this decision as he applied to the first Tribunal on 25 August 2003. The application to the third Tribunal was made on 23 June 2008, clearly outside the 28 day period. Therefore, there was no valid application and the third Tribunal did not have jurisdiction pursuant to that application to review the delegate's decision. 21 Further, the second Tribunal had already reviewed the delegate's decision. Once the Tribunal has delivered its decision free from jurisdictional error, it is functus officio . Once the statutory function is performed, there is no further function authorised under the Act for the Tribunal to carry out and it has no power to reopen the delegate's decision ( Jayasinghe v Minister for Immigration and Ethnic Affairs [1997] FCA 551 ; (1997) 76 FCR 301 per Goldberg J at 311). 22 In Minister for Immigration and Multicultural Affairs v Thiyagarajah [2000] HCA 9 ; (2000) 199 CLR 343 Gleeson CJ, McHugh, Gummow and Hayne JJ noted that the Act contemplates changed circumstances which might found a fresh application to the Tribunal, but imposes the limitations found in ss 48A and 48B. In the situation where the Tribunal had, without reviewable error, disposed of an application for review of the decision of the delegate made on 11 October 1995, the Act did not confer upon the Tribunal any authority subsequently to reconsider the decision of the delegate by reason of later changed circumstances. 23 In SZBWJ v Minister for Immigration and Citizenship [2008] FCA 1175 , the applicants sought a further review by the Tribunal of a delegate's decision. Treating the Tribunal as authorised to undertake a second review of the delegate's decision would be contrary to the statutory aim of providing a mechanism of review that is "fair, just, economical, informal and quick": see s 420(1) of the Act. That line of cases has recently been followed by Cowdroy J in SZCKX v Minister for Immigration & Citizenship [2008] FCA 526 and Moore J in SZBWJ v Minister for Immigration & Citizenship [2008] FCA 1175. 25 For these reasons, Smith FM did not err in his conclusion that the third Tribunal did not have jurisdiction to consider the application to conduct a second review of the delegate's decision. The third Tribunal correctly found that it lacked jurisdiction. He claims that when he filed his application he was issued with a standard letter and then received no further correspondence from the third Tribunal (until the letter notifying him of the decision) and was not asked the reason for his repeat application. He claims that the third Tribunal did not give him an opportunity to reply concerning the validity of his application. 27 The letter dated 23 June 2008 appears to be a standard Acknowledgement of Application letter. If we can consider it, a Member of the Tribunal will look at the information you and the Department have given us and information about your country. [emphasis added] Will I be invited to a hearing of the Tribunal? The letter does not state expressly or implicitly that the recipient will be given the opportunity to submit information to the third Tribunal concerning its decision whether it has jurisdiction to consider the review application. In this regard it is not misleading. Rather, as submitted by the Minister, the words of the letter convey that if, and only if, the third Tribunal is able to consider the applicant's review application, the third Tribunal may then contact the applicant for further information or comment. 29 Further, the letter contains the following passage under the heading ' What does the Tribunal expect me to do? Any documents not in English should be translated by a qualified translator. 30 The letter sent by the third Tribunal to the applicant represented an opportunity for, or invitation to him to make written submissions to the third Tribunal regarding the question of jurisdiction. He did not avail himself of this opportunity. The letter did not represent a failure to accord procedural fairness. In the course of so doing the Tribunal considered the form lodged by the applicant and any submission which the applicant submitted therein. Any further right to procedural fairness before the Tribunal only arises if the Tribunal has the power to consider the application in the first place. Part 7 of the Migration Act, 1958 deals with review of protection visa decisions by the Tribunal. Section 411 provides which decisions will be reviewable. Only if a decision is such an "RRT --- reviewable decision" (defined in s.5) will the procedures regarding the conduct of the review (see Division 4 of Part 7) be applicable. In other words, the applicant's only rights in the Tribunal arise from, or as a consequence of its jurisdiction to review. 32 The preliminary finding of the third Tribunal, that it did not have jurisdiction to review the delegate's decision, is a decision pursuant to s 474 of the Act. The Minister, though not directly addressing the question of common law procedural fairness and natural justice, contends that the applicant's only rights in the Tribunal arise from, or as a consequence of, its jurisdiction to review. In other words, the Minister's contention seems to be that where the Tribunal has no jurisdiction, the applicant has no rights to procedural fairness, arising from the Act or otherwise. If there was no RRT-reviewable decision, there was no "decision under review". It follows that the third Tribunal was under no such obligation. I note that Barnes FM has concluded that no such obligation arises where the Tribunal finds that it has no jurisdiction ( SZHMM v Minister for Immigration [2008] FMCA 343 ; SZHOK v Minister for Immigration [2008] FMCA 1104) or in relation to the preliminary issue of whether the Tribunal has jurisdiction ( SZEAC v Minister for Immigration [2007] FMCA 1552). The third Tribunal made a preliminary finding that it did not have jurisdiction to review the decision. No review was undertaken, and Part 7 Div 4 of the Act, including s 422B , does not come into operation. The requirements of natural justice are then not excluded by s 422B of the Act. 37 Common law natural justice and procedural fairness require that the applicant be given a reasonable opportunity to deal with matters adverse to his interest that the decision maker proposes to take into account in exercising its power. 38 The third Tribunal gave the applicant the opportunity to make submissions on the question of jurisdiction before reaching its decision, in accordance with principles of natural justice and procedural fairness. The third Tribunal was not required to invite the applicant to a hearing, or to put its thought processes about its jurisdiction to the applicant for comment. The invitation to submit further "documents, information or other evidence" satisfied the third Tribunal's obligations to accord the applicant natural justice and procedural fairness, in circumstances where the applicant did not avail himself of the opportunity to make a submission or seek a hearing. What would the applicant have said to the Tribunal? I also asked the applicant to identify any error in the conclusion by Smith FM that the third Tribunal had not erred in finding that it had no jurisdiction to hear his present application. The applicant was unable to make any relevant submission other than his assertion that the second Tribunal made a mistake and he wished to have the second Tribunal decision reconsidered. Therefore, even if there had been a denial of natural justice or procedural fairness, no practical injustice flows from it ( Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6 ; (2003) 214 CLR 1 per Gleeson CJ at [37]). As the Minister submits, an opportunity to address the Tribunal on the question of jurisdiction was ' a hollow opportunity '. Such a complaint is misconceived in circumstances where the third Tribunal found that it had no jurisdiction to conduct a second review of the delegate's decision. Section 424A is part of those provisions of the Act which govern the procedures to be adopted in the conduct of a review (set out in Part 7 Div 4 of the Act). Those provisions were not engaged. The applicant has not shown any error on the part of the Federal Magistrate nor has he shown that he has any prospects of success in an appeal from that decision. No substantial injustice would result if leave to appeal is not granted. The application for leave to appeal should be dismissed with costs. I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bennett. | application for leave to appeal tribunal decision previously considered and special leave refused further application to tribunal for review of delegate's decision tribunal correct in finding that it had no jurisdiction to reconsider delegate's decision procedural fairness natural justice whether tribunal denied procedural fairness and natural justice to applicant in finding that it had no jurisdiction whether tribunal obliged to comply with procedural requirements under the migration act 1958 (cth) where there was no rrt-reviewable decision whether common law procedural fairness and natural justice applied no practical injustice from any denial of procedural fairness or natural justice whether letter from tribunal misled applicant no evidence that applicant was misled by letter letter satisfied tribunal's obligations to provide procedural fairness and natural justice applicant failed to take opportunity provided by tribunal to make written submissions migration migration migration |
The trial had occupied nine sitting days. The applicant pleaded causes of action in rectification, contractual breach of a lease, waste, unconscionable conduct contrary to ss 51AA and 51AC of the Trade Practices Act 1974 (Cth) and contraventions of ss 52 and 53 (g) of that Act and sought various forms of relief. In the event the applicant was only successful on the claim that the respondent had breached a clause of the lease which required it to obtain the written approval of the applicant before undertaking significant structural alterations to the leased premises. Damages of $34,820.00 were awarded to the applicant. I invited submissions from the parties as to what costs orders should be made. Reliance was placed on O 23 r 11(5) of the Federal Court Rules ("the Rules") which deals with the consequences of the rejection of an offer of compromise in circumstances where the rejecting party fails to obtain judgment in a sum more favourable than the terms of the offer. The one third reduction proposed in relation to the period before the offer was rejected was justified by reference to O 62 r 36A(1) which provides for such a reduction where judgment is awarded for less than $100,000. The applicant seeks to justify a departure from the general rule established by O 62 r 36A(1) by pointing to what is said to be the "special degree of legal complexity" involved in the proceeding. Indeed, such orders would be taken to have been made by force of the rule unless the Court otherwise orders. The rule is plainly directed to encouraging parties to give the most serious possible consideration to offers of compromise; they are not lightly to be rejected. As the applicant acknowledged, it carries a heavy burden when seeking to persuade the Court to determine that the rule should not operate in this case. 7 Issues based apportionment of costs will be appropriate in certain circumstances. It is not easy, however, to accept that the results of any issues based analysis can have a bearing on the question of whether the general rule which is stipulated in O 23 r 11(5) should not operate in a particular case. Subject to a contrary order of the Court that provision will operate if the quantum of damages which is awarded by the Court is less than the offer of compromise. An applicant may thus succeed on all issues and still be required to pay costs on an indemnity basis in the period after the offer was rejected. Although it may be accepted, in the present case, that the trial may have been somewhat shorter had the respondent conceded the breach of the lease, this, in my opinion, is not sufficient to warrant a departure from the consequences prescribed by O 23 r 11(5). The respondent's defence of its position in relation to the breach of the lease was at least arguable and it did not, in pursuing its defence, unreasonably prolong the trial. 8 The particular paragraph in the witness statement which it is said provoked the rectification claim related to correspondence and discussions between the parties "during the second half of 1997 and in 1998". They related to the witness's recollections as to why it was that he was disposed to accept or not oppose repeated assertions by the applicant that the respondent had an obligation, under the lease, to reinstate the building (including the foyer) at the end of the lease. As I held in my principal judgment (at [61] --- [63]) the relevant time at which the necessary common intention had to exist was the time at which the lease was executed in December 1996. Evidence as to one witness's state of mind in the latter part of 1997 and in 1998 could have had no bearing on his intention (assuming it to be relevant) in December 1996. Furthermore, the witness specifically said that he had not been involved in the negotiation of the lease. 9 I therefore decline to make any order which would displace the operation of O 23 r 11(5) in this case. They amounted to $1,380,000. This was not a case which, had the applicant's principal submissions been accepted, it was likely that the best that could be hoped for by way of damages would have been less than $100,000. Moreover, the issues were complex as evidenced by the engagement, on both sides, of senior counsel and the length of the submissions made on behalf of both parties: cf Tu v Pakway Australia Pty Ltd (2006) 227 ALR 287 at 293. These considerations warrant, in my view, a departure from the general rule. 13 There should, therefore, be an order that costs not be reduced pursuant to O 62 r 36A(1) of the Rules. Save for the addition of this order and the deletion of the words "reduced by one third" in the first of the two orders proposed by the respondent the orders of the Court should be in accordance with those proposed by the respondent. | indemnity costs where applicant rejected offer of compromise where damages awarded to applicant amounted to less than $100,000 whether costs order reducible general rule stipulated in o 23 r 11(5) of federal court rules applied departure from general rule proscribed by o 62 r 36(1) costs |
Each breach contravened s 140A(3) of the Act and attracted liability for a civil penalty (s 140A(7)). Each contravention attracted a maximum civil penalty of 500 penalty units, a total of $55,000 (see ss 139(3), 140A(3), 205F(4)). The breaches occurred over the course of 2 months in late 2007 when the well-known broadcaster, John Laws, failed to make disclosure announcements that he was sponsored by businesses at the time and as part of the broadcasts in which his sponsors', or their products' or services', names were mentioned during the course of his morning radio program, The John Laws Morning Show . I have attached a description of each contravention in a schedule to these reasons taken from the Authority's investigation report No 2100 of October 2008. Mr Laws was paid very large sums of money by these businesses for their sponsorship. The Authority had made a program standard known as the Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000 pursuant to s 125 of the Act. The disclosure standard commenced in January 2001. It had been made following a report of the Authority's predecessor, the Australian Broadcasting Authority, called the " Commercial Radio Enquiry ". That had enquired into a broadcasting practice colloquially referred to as "cash for comment". The purpose of the disclosure standard was to require commercial radio licensees to ensure that whenever one of the station's presenters mentioned the name of a sponsor, or its products or services, the presenter made a disclosure announcement about his or her commercial relationship with the sponsor. Radio 2UE had to comply with the disclosure standard because this was a condition of its commercial radio broadcasting licence by force of cl 8(1)(b) in Sch 2 of the Act. There is no doubt that Mr Laws was fully aware of who his sponsors were and how much they were paying him on the occasion of each contravention. But he did not comply with the obligations of Radio 2UE to make disclosure. The parties prepared an agreed statement of facts which I will set out shortly. They agreed that it was appropriate to suggest to the Court that a penalty of $10,000 per contravention should be imposed. That would result in a total of $130,000 in civil penalties being payable by Radio 2UE. The Authority and Radio 2UE suggested that these figures were appropriate to reflect a penalty at the lower end of the range having regard to all the circumstances, including Radio 2UE's immediate co-operation with the Authority's enquiry, its contrition and acceptance of responsibility for the contraventions. In addition, Radio 2UE agreed to pay $20,000 in respect of the Authority's costs. The maximum penalties were $55,000 per contravention or a total $715,000. Radio 2UE submitted that a number of matters should be seen as significant mitigating factors. It contended that, overall, its conduct warranted a conclusion that a penalty at the lower end of the range was appropriate, as the Authority had accepted. Radio 2UE relied on the evidence of Graham Mott and his conduct in support of its position. Mr Mott had been the group general manager for the Southern Cross Radio network from February 2003 to 8 November 2007 when it was taken over by Fairfax Media. Since 9 November 2007 he has been the group general manager of Fairfax Radio Network where he is responsible for managing the day to day operations of 28 radio stations and ensuring their compliance with, among others, financial and legal regulatory requirements. He has had over 40 years experience in radio broadcasting, gained largely at music and talk-back radio stations. Mr Mott was not cross-examined. I accept that he gave his evidence candidly and honestly. However, I must still weigh that evidence against the objective facts, the requirements of the Act and Radio 2UE's licence. I also accept that Mr Mott, and through him Radio 2UE, intended that Radio 2UE would comply with the disclosure standard. But that compliance depended on its presenters', and in particular, Mr Laws', on-air behaviour. When the matter was first listed for hearing, I was concerned that, as this was the first action for civil penalties under the Act, the relationship between the contravention and a commercial licence might involve different considerations than those in other situations permitting the imposition of civil penalties for contraventions of other legislation. Accordingly, I asked the parties to consider whether there ought be a contradictor. Both opposed that course. However, the Authority identified the Communications Law Centre as a body that might be an appropriate intervenor: see Australian Communications and Media Authority v Radio 2UE Sydney Pty Ltd [2009] FCA 214. Soon afterwards, the Centre sought to intervene. The Centre appeared by its director, Prof Michael Fraser, and he and each of the parties provided considerable assistance at the hearing. The Act charged the Authority with responsibility for monitoring the broadcasting industry (s 5(1)(a)). The Act conferred on the Authority a range of functions and powers to be used in a manner that, in its opinion, would produce regulatory arrangements that were stable and predictable and would deal effectively with breaches of the rules established by the Act (s 5(1)(b)). The licence was subject to a condition that the licensee comply with program standards applicable to the licence under Pt 9 of the Act (Sch 2, cl 8(1)(b)). Relevantly, s 139(3) of the Act provided that a commercial radio licensee that engaged in conduct that breached a condition of cl 8(1)(b) of Sch 2 was guilty of an offence and liable to a penalty of 500 penalty units. It inserted s 140A into the Act. That expanded the powers of the Authority to deal with breaches of licences by arming it with powers to bring civil proceedings to recover a civil penalty. That provided that if the Federal Court is satisfied that a person has contravened a civil penalty provision, it may order the person to pay the Commonwealth a pecuniary penalty, known as a "civil penalty order" (s 205F(1) and (2)). A pecuniary penalty is a civil debt payable to the Commonwealth which it is entitled to enforce as a judgment debt (s 205F(8)). Only the Authority may apply for a civil penalty order (s 205G(1)). The Authority also obtained the power to accept an enforceable undertaking. This is a written undertaking given by a person, among other things, to take specified action in order to comply with the Act (s 205W(1)(a)). Such an undertaking is enforceable under s 205X. The Authority may apply to this Court for, among others, orders requiring the person to comply with the undertaking, directing the person to pay to the Authority, on behalf of the Commonwealth, a sum up to the amount of any financial benefit reasonably attributable to the breach that the person obtained directly or indirectly and compensation (s 205X(2)). The explanatory memorandum circulated by the Minister for Communications, Information Technology and the Arts in support of the Bill that became the 2006 amending Act explained the purpose of introducing the civil penalty and enforceable undertaking regime. This was to complement the use of enforceable undertakings by providing further mid-range enforcement options for the Authority and industry to consider in the event that a breach had been committed. One express purpose considered in the explanatory memorandum was a perceived deficiency in the Authority's enforcement powers. Such breaches were ones that did not warrant criminal sanctions, suspension or cancellation of a licence (see EM pars 14, 16). The explanatory memorandum referred to difficulties associated with criminal sanctions that had been highlighted following the Authority's findings in December 2003 that Radio 2UE had committed 19 breaches of the disclosure standard. However, later, the Director of Public Prosecutions advised the Authority that on the evidence available there would be no reasonable prospect of a conviction of Radio 2UE in relation to those breaches. These breaches also involved Mr Laws. The explanatory memorandum observed that suspension or cancellation of a licence was a severe penalty that affected consumers of the service as well as the broadcaster who could be expected to suffer significant economic loss as a consequence. It noted that the Authority had never used this power in respect of breaches by commercial broadcasters. The standard required, relevantly: The disclosure standard defined a "current affairs program" as a program that had a substantial purpose of providing interviews, analysis, commentary or discussion, including open line discussion with listeners, about current social, economic or political issues (cl 6). Thus, the standard applied to "talk back radio", where the presenter and callers speak on-air about current topics. The standard defined "sponsor" to mean a party to a commercial agreement (other than a presenter) as well as the party or parties who were directly to benefit from the promotion or other services provided by the presenter. For the purpose of these proceedings a critical obligation was contained in cl 7(1). A licensee had to keep a register of current commercial agreements between sponsors and presenters of current affairs programs (cl 9(1)). That register had to be available free of charge for public inspection and published on the licensee's website (cl 9(2) and (3)). The register had to identify details of each commercial arrangement, including specifying the value or benefit to be provided under it as either falling within one of three bands, $10,000 or less p.a., more than $10,000 but not more than a $100,000 p.a. or more than $100,000 p.a. (cl 10(5)). Presenters had to disclose all commercial agreements to their licensee employer (cl 12). And, cl 13 provided that a licensee had to require each presenter to comply with relevant obligations imposed on the licensee by, among other things, the disclosure standard. The disclosure standard contemplated that a presenter would be able to earn remuneration directly from a third party. Generally such a third party would be a person who could have advertised on the presenter's employer's radio station. The licensee might lose the benefit of advertising revenue while the presenter used its licence to earn remuneration for himself or herself from the sponsor without accounting to his or her employer. Moreover, unless the commercial agreement were disclosed on-air, listeners may not appreciate the true context for the presenter's reference to his or her sponsor or their product or service, including any apparently favourable treatment. The disclosure standard was intended to provide for transparency in broadcasting. One important purpose was to enable a listener to judge whether a presenter's reference to one of his or her sponsors was his or her genuine opinion, or simply something that he or she was being paid to say as if it were their genuine opinion. It is patent how such a practice could mislead listeners into believing that the references made to sponsors, their products or services or opinions expressed by a presenter, instead of being an advertisement or potentially an advertisement, were the presenter's opinion. Thus, when a person telephones a talk back radio presenter of a current affairs program and discusses a particular product or service, mentioning a sponsor's name, unless the presenter disclosed that he or she was being sponsored by that entity, the public discussion which would occur between the presenter and the caller would not be transparent. After all, the presenter could select or pre-arrange for a caller who would mention the sponsor, product or service as part of the presenter's commercial arrangement with the sponsor. The chairman of the Authority, Chris Chapman, explained its reasons for commencing these proceedings in a media release. Radio 2UE relied on the media release, its dissemination and its terms as evidence of harm to Radio 2UE's reputation in respect of compliance and of its public denunciation in respect of the 13 contraventions (cf Ryan v The Queen [2001] HCA 21 ; (2001) 206 CLR 267 at 284-286 [52] - [59] per McHugh J, 303-304 [123] per Kirby J, 318-319 [177] per Callinan J). It is a licensee's unrelenting responsibility to manage its business, including its presenters and production staff, so as to ensure satisfactory compliance with the regulatory requirements. One consideration informing the Authority's agreement to consenting to the civil penalty order was its assessment that Fairfax genuinely accepts that proposition. Abuse of the privilege, by breaching a condition of a licence, attracts liability under ss 139(3) and 140A(3). The primary purpose of s 140A(3) is to protect the public by holding licensees to the standard of conduct that their licence requires them to observe. The disclosure standard addresses a particular, and insidious, means of abusing the privilege of a commercial radio broadcasting licence. That standard recognised the significant degree of influence current affairs presenters could exert in shaping community views in Australia (see s 4(1)). The more prominent the presenter, the greater the potential he or she has to exert influence in shaping community views. The spoken word is the vehicle used to shape views on radio current affairs programs. The identity of the speaker, if known to the audience, can itself influence their receptivity to what he or she says; as can the speaker's oratorical style and manner of delivery. And, because of its orality, publication in a radio broadcast conveys a transient message. The listener may tune in or turn on the radio part way through a program; he or she may have missed an earlier disclosure announcement by the presenter when he or she returns to a topic that attracts an obligation to make such an announcement. If it is not made, that new listener will not be aware of what the disclosure standard, and the licence, require be conveyed contemporaneously, namely the presenter's sponsorship. Additionally, listeners may not always be attentive to what is being broadcast on radio and may miss the significance, or indeed the occurrence, of an earlier disclosure statement in the same program. That can affect the meaning which the listener understands to have been conveyed by what he or she hears the presenter saying later. These characteristics of transient communications, such as radio or television broadcasts, are also recognised in the common law principles of defamation: Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 at 165G-166E per Hunt CJ at CL, Mason P and Handley JA agreeing. Thus, the transience both of what is spoken on-air during a radio broadcast and of the listening audience (who may tune in or out at any time and, when tuned in, may pay closer or lesser degrees of attention) underlie the policy behind the disclosure standard's insistence on the presenter making a disclosure announcement contemporaneously each time one of his or her sponsor's name, products or service is mentioned. The liability in s 140A(3) corresponds to, but is distinct from the criminal liability imposed by s 139(3). The conduct proscribed by each section is the same, namely a breach of a condition of a licence set out in cl 8(1) of Sch 2, including a breach of the disclosure standard. But the objects of the two sections are not the same. One object of s 140A(3) is to create a civil, not criminal, liability so as to enable the Authority to secure compliance with important provisions in the Act more readily than through criminal proceedings. But another object of the section is to reinforce the norm of conduct for licensees in s 139(3) and to provide a means to enforce their compliance with it less drastic than the remedies existing before 2006. The Parliament provided that the civil penalty could match the criminal penalty for the same conduct of a commercial radio broadcasting licensee in breaching a condition of its licence. However, the imposition of a civil penalty under s 140A(3) would not carry the stigma attached to a criminal conviction under s 139(3). And, pursuant to s 205K of the Act the civil penalty could be imposed after a trial using the civil onus of proof (see too s 140 of the Evidence Act 1995 (Cth)): see too Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission [2007] FCAFC 132 ; (2007) 162 FCR 466 at 477-482 [19] - [38] per Weinberg, Bennett and Rares JJ. A primary purpose of civil penalties is deterrence: Trade Practices Commission v CSR Limited (1991) ATPR p41-076 at 52,152 per French J. Hence, in assessing the penalty to be imposed, a court will consider whether, in all the circumstances relevant to be taken into account (here under s 205F(3)), others would be deterred by the penalty and at the same time the licensee will be penalised or punished appropriately. The range of relevant matters under s 205F(3) ordinarily will include (borrowing from what French J suggested in CSR (1991) ATPR p41-076 at 52,152-52,153): The parties urged that no difference in approach to fixing an agreed civil penalty was called for under the Act as compared to the approach taken under legislation such as under s 76 of the Trade Practices Act 1974 (Cth) and s 42Y of the Therapeutic Goods Act 1989 (Cth). They relied on what Flick J had said in Secretary, Department of Health and Aging v Pagasa Australia Pty Ltd [2008] FCA 1545 at [17] , [23]-[25]. It is that mandate which directs attention to those more specific matters which can only be discerned from an analysis of the 1989 Act itself. Of central importance in identifying those matters which are " relevant " --- and which must therefore be taken into account --- are the objects and purposes of the 1989 Act. French J remarked in CSR (1991) ATPR p41-076 at 52,152 the other general objects of the criminal law apart from deterrence, namely retribution and rehabilitation, had no "... part to play in economic regulation of the kind contemplated by Pt IV" of the Trade Practices Act . However, I am of opinion that other considerations arise under the Broadcasting Services Act . The purpose of regulation under the Act, including the imposition of civil penalties for contraventions of s 140A(3) under s 205F, must be gleaned from the detail of the provisions of the Act. The common law recognises that its remedy of damages for tort includes, in addition to deterrence, punishment and condemnation of both the actual wrongdoer's behaviour and the behaviour of another for whose conduct the defendant is answerable. Those objects are, therefore, not exclusively a function of the criminal law. In Lamb v Cotogno [1987] HCA 47 ; (1987) 164 CLR 1 at 8 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ cited with approval Pratt LCJ's explanation in Wilkes v Wood [1763] EngR 103 ; (1763) Lofft 1 at 19 [98 ER 489 at 498-499] that exemplary damages are awarded "as a punishment to the guilty, to deter from any such proceeding for the future and as a proof of the detestation of the jury to the action itself". The fact that a defendant who is covered by compulsory third party motor vehicle insurance and so will not pay the sum awarded as exemplary damages from his, her or its own pocket, or that the defendant is the insurer, does not restrict the power of the court to award exemplary damages: Lamb 164 CLR at 11; Gray v Motor Accident Commission (1998) 196 CLR 1 at 12-13 [32]-[36] per Gleeson CJ, McHugh, Gummow and Hayne JJ, 29 [87] per Kirby J, 50 [141] per Callinan J. In Rich v Australian Securities and Investments Commission [2004] HCA 42 ; (2004) 220 CLR 129 at 146 [35] Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ said that classification of proceedings as protective or penal wrongly assumed that those two objects were mutually exclusive. They held that a law may bear several characters, as may proceedings that seek relief which, if granted, would protect the public and penalise the defendant. Talk back radio and current affairs programs of the kind that Mr Laws had, occupy a significant place in commercial radio broadcasting. Presenters of such programs can exert considerable influence in shaping community views. In Victoria v Australian Building Construction Employees' and Builders Labourers' Union [1982] HCA 31 ; (1982) 152 CLR 25 at 98 as Mason J spoke of "... the overriding importance of freedom of discussion and speech", adding "without information, there can be no meaningful discussion": see too Australian Capital Television Pty Ltd v The Commonwealth [1992] HCA 45 ; (1992) 177 CLR 106 at 139-140 per Mason CJ. It is now established that each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the people of Australia. The duty to disseminate such information is the correlative of the interest in receiving it: Lange v Australian Broadcasting Corporation [1997] HCA 25 ; (1997) 189 CLR 520 at 571 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh, Gummow and Kirby JJ. The media fulfil a vital role in the ability of the Australian community and, in particular, electors to engage in the discussion of government and political matters, and ss 3 and 4(1) of the Act, in part, recognise this. The disclosure standard was a key instrument to ensure transparency in current affairs radio broadcasting. Failures to disclose could violate the public's ability to trust in the quality and nature of information conveyed in programs such as Mr Laws'. Unlike the regulation of economic behaviours provided in Pt IV of the Trade Practices Act , the Act creates the right to hold a licence but regulates the licensee's exploitation of that right for its own benefit, by imposing limitations crafted in, and to secure, the public interest. A commercial radio broadcasting licence confers an economic privilege on a licensee exercisable in accordance with the Act, standards and the conditions of the licence. These important and distinct features of the Act were recognised in the extracts I have quoted from Mr Chapman's media release. For these reasons, I am of opinion that it is relevant to include, in the amount of a pecuniary penalty fixed under s 205F, in an appropriate case, some element of punishment of or retribution against, or stigmatisation of, a licensee which, in the course of conducting its business using the licence for its own profit, contravenes an important condition of the licence or the Act. The contravention of s 140A(3) by a failure to comply with the disclosure standard can amount to a violation of the public trust reposed in a licensee. As Mr Chapman tellingly said, the obligation to comply with that standard "... goes to the heart of the licensee's obligations". Just as there is no single, correct sentence, so too there is no single, correct amount of a pecuniary penalty: cp Markarian v The Queen [2005] HCA 25 ; (2005) 228 CLR 357 at 371 [27] per Gleeson CJ, Gummow, Hayne and Callinan JJ. In arriving at an appropriate penalty, a court must give careful attention to the maximum provided for in the Act. The maximum invites comparison between the worst possible case and the case before the Court. And the maximum can provide a yardstick when balanced with the other relevant factors: Markarian 228 CLR at 372 [30]-[31]. In this respect, ordinarily the worst possible case for a civil penalty would not be equivalent to the worst possible case for a criminal penalty under the corresponding section in the Act. That is because, first, the purpose of the Parliament providing for the civil penalty was to enable the Authority to use that power to address conduct not warranting the use of the corresponding criminal provision or the suspension or cancellation of a licence. Secondly, if a person has been convicted of an offence (e.g. under s 139(3)) constituted by substantially the same conduct as attracts a civil penalty (e.g. under s 140A(3)) then s 205L prohibits the Court making a civil penalty order against that person. And, s 205M stays civil penalty proceedings if criminal proceedings have been or are later commenced in respect of substantially the same conduct. If the person is convicted, then s 205M(2) provides for the civil penalty proceedings to be dismissed, but the stay is lifted if the person is acquitted. Conversely, s 205N authorises criminal proceedings to be commenced in the opposite situation; i.e. after a civil penalty order has been made. This preserves the option of later prosecution where, for example further evidence has come to light showing that a more severe penalty is called for than that in the civil penalty order. There is a prosecutorial discretion to bring criminal proceedings under s 205N. Ordinarily, some enlivening factor must arise after the conclusion of the civil penalty order proceedings to warrant the initiation of the criminal proceedings so that they would not be seen as an abuse of process in light of the policy in ss 205L and 205M (e.g. if facts subsequently were discovered, casting a different light on an apparently middle range contravention for which a civil penalty was appropriate, prosecution might be warranted). Where ss 205L or 205M apply, the apparent intention of the Parliament, was to exclude the use of the civil penalty order if criminal proceedings result in conviction. This is because the stamp or, possibility, of the conviction has characterised the contravention (even if only temporarily so, pending the determination of the criminal proceedings) as of a more serious kind. No doubt the civil penalty imposed would be relevant to the criminal penalty following conviction, where s 205N applies. But, s 205N must be read harmoniously with the legislative policy reflected in ss 205L and 205M: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28 ; (1998) 194 CLR 355 at 381-382 [69] - [71] per McHugh, Gummow, Kirby and Hayne JJ. For many years the Court has recognised the ability of parties to such proceedings to make a joint or agreed submission as to the civil penalties to be imposed for contraventions of legislation. Agreement as to the suggested result can be reached prior to the institution of the proceedings for civil penalties, as happened here. Ordinarily, there will be savings in time and public and private expense that can be expected from parties putting forward, in a responsible manner (as they have in these proceedings) agreed contraventions and suggested penalties. The Court may reject the suggested penalty, and impose a different one. But, in the ordinary case the use of this sensible approach will result in a speedy determination of the proceedings. Such a consequence is obviously of considerable benefit to the community; a lengthy and expensive trial and possibly an appeal or appeals are averted and a just penalty is imposed. But there is another, very important benefit in the approach; it gives the wrongdoer a degree of certainty and a speedy imposition of the penalty. Where a result is uncertain, such as the outcome of a contested trial and the consequent penalty (whether a criminal sentence or the imposition of a civil penalty), it is all too human for a wrongdoer to procrastinate in the hope that something will work out favourably. But if a wrongdoer (such as a person who contravenes a civil penalty provision in legislation) can have relative assurance that, however severe, an agreed penalty is likely to be imposed promptly, that degree of certainty is a powerful spur to action. Ordinarily, the views of the Authority will be of significant weight in assisting the Court to fix an appropriate pecuniary penalty for a contravention of s 140A(3) of the Act. The Authority's functions and role under the Act enable it to offer insight into the circumstances and impact of the contravention and the measures taken or proposed to guard against similar conduct in the future. And, one purpose of enacting the civil penalty provisions was to give the Authority access to a greater range of enforcement measures. When corporations acknowledge contraventions, very lengthy and complex litigation is frequently avoided, freeing the courts to deal with other matters, and investigating officers of the Australian Competition and Consumer Commission to turn to other areas of the economy that await their attention. At the same time, a negotiated resolution in the instant case may be expected to include measures designed to promote, for the future, vigorous competition in the particular market concerned. These beneficial consequences would be jeopardised if corporations were to conclude that proper settlements were clouded by unpredictable risks. A proper figure is one within the permissible range in all the circumstances. The Court will not depart from an agreed figure merely because it might otherwise have been disposed to select some other figure, or except in a clear case. Generally, the Court does not undertake the exercise of fixing a penalty itself to assess whether it is prepared to give effect to the parties' suggestion: NW Foods 71 FCR at 291B-G. The assessment of a pecuniary penalty that is appropriate, having regard to all relevant factors under s 205F(3) is, like a criminal sentence, the result of the "process of instinctive synthesis" described in Markarian 228 CLR at 373-374 [36]-[37] and Wong v The Queen [2001] HCA 64 ; (2001) 207 CLR 584 at 611-612 [74] - [76] per Gaudron, Gummow and Hayne. If what is suggested by the parties as an appropriate penalty is unreasonable or plainly unjust, the court can reject it on similar principles to those used when sentences are either manifestly excessive or inadequate: cf Markarian 228 CLR at 370-371 [25]; Lukatela v Birch (2008) 223 FLR 1 at 7 [25]-[26]. But in neither case is the court relieved from the responsibility of exercising its own judgment as to the appropriate sentence (in criminal cases), or whether the proposed penalty is within the appropriate range for the contravention (in civil penalty cases). In each case, the Court should be satisfied that it is being given accurate, reliable and complete information on critical questions. These included the propositions that: the Court is not obliged to commence its reasoning with the level of the agreed penalty and limit itself to considering whether that penalty is within the range; the Court is entitled to address the question independently at the outset of its reasoning; the admissions and agreed facts should not be approached as if they had been "tailored or modified to reflect the difficulties faced by the [regulator] in proving its case"; the regulator should always explain to the Court the process of reasoning said to justify a discounted penalty. At all material times, the Respondent, Radio 2UE Sydney Pty Ltd (2UE) was the holder of the commercial radio broadcasting licence numbered SL4102. 2UE has held this licence since circa 1940. It was last renewed on 23 August 2006 pursuant to s 47 of the Act. 2UE's licence is subject to the conditions set out at Pts 2 and 4 of Sch 2 to the Act (see also ss 42(2) and 43 of the Act). Relevantly, Pt 4 of Sch 2 to the Act (which contains only one clause - cl 8) specifies the standard conditions of commercial radio broadcasting licences. It was made pursuant to Pt 9, s 125 of the Act. It commenced operation on 15 January 2001. It remains in force. The Disclosure Standard relevantly provides that a licensee must cause to be broadcast during a current affairs program a disclosure announcement at the time of and as part of a broadcast of any material in which the name, products or services of a sponsor are mentioned. Each of the emphasised terms are defined by cl 6 of the Disclosure Standard. On 12 October 2006, ACMA commenced an investigation into 2UE's compliance with the Disclosure Standard and other programming standards. On 25 September 2007, ACMA published a report of its findings from the investigation (2007 Report) that ACMA had undertaken. In that investigation ACMA found two (2) breaches of the Disclosure Standard by 2UE during a broadcast of the Show on 28 August 2006. One (1) of those breaches of the Disclosure Standard involved a failure by 2UE to cause a "disclosure announcement" to be broadcast during the Show at the time of and as part of a broadcast of material in which the name, products or services of a sponsor of John Laws were mentioned. After these findings were made 2UE offered ACMA an enforceable undertaking pursuant to s 205W of the Act, which ACMA accepted on 24 September 2007 (Enforceable Undertaking). In November 2003 the ABA published a report of its finding following an investigation into breaches by 2UE of, amongst other things, the Disclosure Standard. This report relevantly found that 2UE breached the Disclosure Standard on ten (10) occasions for failing to cause a disclosure announcement to be broadcast at the time a sponsor's a name was mentioned during the broadcast of the John Laws Morning Show. It found a further nine (9) breaches of the Disclosure Standard for failing to broadcast a disclosure announcement in the prescribed form. The ABA investigation found a further six (6) breaches of a separate requirement then in force that required the licensee to disclose, on air, the existence of "major commercial agreements", being commercial agreements the value of which was greater than $100,000 per year. In September 2007 ACMA published the 2007 Report as detailed at paragraphs 9 to 11 above. On 5 November 2007, a wholly-owned subsidiary of the Macquarie Media Group acquired Southern Cross Broadcasting (Australia) Limited. On 9 November 2007, Fairfax News Network Pty Limited, a wholly-owned subsidiary of Fairfax Media Limited, acquired Tricom Radio Holdings Pty Ltd (now known as Fairfax Radio Network Pty Limited), the parent company of 2UE. Four (4) Incidents relate to a period during which 2UE was ultimately owned by Fairfax Media Limited. Those four (4) Incidents occurred on John Laws' last day as an on-air presenter for 2UE. 2UE will separately provide evidence of its financial position. Qantas Airways Ltd - more than $100,000 per annum. The parties agreed that an amount of $10,000 in respect of each of the thirteen (13) breach findings in the 2008 Report would be appropriate. ACMA and 2UE also agreed that 2UE would pay ACMA's costs of the civil penalty proceedings fixed in the amount of $20,000. The respective positions of the parties as regards this agreement will be set out in written submissions. The independent auditor has provided ACMA with 3 reports to date. 2UE, in conjunction with its parent company, Fairfax Media, is currently undertaking a complete review of its compliance program, including manuals with a view to updating and improving the compliance policies and procedures and training sessions of staff of Fairfax Radio Network. From 17 October 2008 to 20 January 2009, the Group General Manager of Fairfax Radio Network, Mr Graham Mott, acted in the position of Acting General Manager of 2UE and a new person was being recruited for that position. On about 28 January 2008 the Fairfax Radio Network appointed Ms Michelle Davies, Corporate Counsel for the Fairfax Radio Network, from the Fairfax Media Limited legal unit to ensure regulatory compliance by 2UE. In February 2008, 2UE amended its monthly declarations in response to Part 3, the last paragraph on page 39 of the Report, to include a timeframe within which presenters must advise 2UE that the presenter has entered into a commercial agreement (or had amended an existing commercial agreement). In February 2008, the Group General Manager of Fairfax Radio Network issued a policy that all ACMA B55 forms, that are required to notify ACMA of a change to the Register of Commercial Agreements, be reviewed and approved by the Group General Manager of Fairfax Radio Network and the Corporate Counsel of Fairfax Radio Network prior to lodgement with ACMA. This procedure ensures that we are aware of amendments to commercial agreements immediately and have the opportunity to review new commercial agreements. From May 2008, in addition to the 2UE General Manager, the Group General Manager of the Fairfax Radio Network and the Corporate Counsel of Fairfax Radio Network are required to review all commercial agreements when they are received from presenters. This process is intended to ensure that no commercial agreement is misinterpreted. From May 2008, 2UE includes a copy of any document which purports to vary or amend a commercial agreement, with the commercial agreement. This process is intended to ensure that 2UE is aware of any extension in the term of a commercial agreement. From May 2008, the Senior Officer (as appointed under the Compliance Program) reviews all commercial agreements, notwithstanding that the claimed consideration is less than $100,000. This process is intended to ensure that all commercial agreements are disclosed in accordance with the Disclosure Standard. 2UE has entered into a deed of cross guarantee with Fairfax Media Limited and thus has adequate provision for the payment of the agreed penalty and costs. 2UE complied with its obligation under paragraph 11.2 above. 2UE has complied with its obligations under paragraph 11.3 above to date, except that the first report was provided by 2UE to ACMA on 7 December 2007, being 8 days after the due date of 29 November 2007. 2UE and Fairfax Media Limited have at all times provided additional information to ACMA when requested by ACMA and have informed ACMA of the steps they have undertaken to improve their compliance program. The resulting publicity surrounding the Incidents and the penalty that 2UE faces is expected to heighten awareness of the requirements of the Disclosure Standard throughout the commercial radio industry in Australia. This background is relevant for the purposes of determining the pecuniary penalty under s 205F(3) of the Act. Early in his program on Monday 28 August 2006, Mr Laws referred to the Commonwealth Government's decision announced the previous Friday that it would sell shares in Telstra. Telstra was a sponsor of Mr Laws. During the course of that day's program Mr Laws interviewed the then Prime Minister concerning the Telstra share sale, invited listeners to participate in a web poll on Mr Laws' own website, read out emails from listeners and discussed with callers the proposed sale. The program lasted 3 hours, but at no stage did Mr Laws make a disclosure statement concerning his commercial agreement with Telstra. This is the event referred to in [10] of the agreed facts. Although that description referred to one breach of the disclosure standard of a failure to make a disclosure announcement. Mr Chapman's media release of 26 November 2008 announcing the commencement of these proceedings said that the Authority had found that Radio 2UE had breached the disclosure standard 20 times during that broadcast. And, the transcript of the program and other evidence supports Mr Chapman's description. On 31 August 2006, Radio 2UE's holding company wrote to the Authority drawing Mr Laws' breaches of the disclosure standard to its attention. That letter informed the Authority that Radio 2UE was considering terminating Mr Laws' contract. This was the event in [8] of the agreed facts. Around this time Mr Laws went on annual leave and returned to air on Tuesday 26 September 2006. On 7 September 2006 Mr Mott together with, Tony Bell, the managing director of Southern Cross Broadcasting, Adam Olding, Southern Cross Broadcasting's director of corporate affairs and general counsel and Radio 2UE's then general manager, Simon Rufhus, met with senior counsel. Senior counsel advised them verbally that Mr Laws' conduct did not entitle Radio 2UE to terminate his contract and that if it did so it would be likely to be in breach of contract itself. Senior counsel warned that that could expose Radio 2UE to liability for very substantial damages and that Mr Laws may also be able to assert an entitlement to "equitable remedies". Mr Mott said that based on this advice Radio 2UE considered that it could not terminate Mr Laws' contract until a court determined that he had materially breached it. Mr Mott said that the contract did not contain a provision that allowed Radio 2UE to suspend or stand down Mr Laws. The second reading of the Bill for the 2006 amendments occurred in the Parliament on 14 September 2006. Mr Ruhfus, wrote to Mr Laws on 25 September 2006. Mr Ruhfus drew Mr Laws' attention to extracts from a transcript of the program of 28 August 2006. The requirements of the Disclosure Standard have been raised and explained to you on numerous occasions, including as recently as 22 May 2006 when you were provided with personal training in relation to the Disclosure Standard by Adam Olding, the General Counsel of Southern Cross Broadcasting. This is a serious matter for this company. The issue is currently before the Australian Communications and Media Authority. There may well be unfavourable consequences for this company. To say that this company is very seriously concerned about your failure and about its possible consequences would be an understatement. On the same day, Mr Ruhfus and Mr Olding had a telephone discussion with Mr Laws who was in Hong Kong returning home from an overseas trip. They told Mr Laws about the breaches and reiterated the requirements of the disclosure standard. They told him that legislation was before the Parliament to give the Authority more power to prosecute breaches of the disclosure standard by imposing fines and enforceable undertakings. Mr Laws told them that he understood the nature of his obligations under the disclosure standard and that his failures on 28 August were "simply an oversight". He then asked if Mr Rufhus and Mr Olding were threatening to treat his conduct as a breach of contract. Mr Olding's file note recorded that Mr Laws "... said if we did so he'd walk". Mr Laws also referred to the disappointment he would feel if Radio 2UE did that after all his years of loyal service. Mr Rufhus and Mr Olding also had a discussion on 25 September 2006 with Mr Laws' production team and re-emphasised the need for them to ensure compliance with the disclosure standard. They told the team of their concern about the nondisclosure. The team members indicated that they were either busy with other tasks and had not heard the broadcast of Telstra's name or had heard it but failed to prompt Mr Laws to make a disclosure statement due to oversight. In late October 2006, the Authority began an investigation of the breaches. Southern Cross Broadcasting informed the Authority that Mr Laws had indicated that he was aware of the requirements of the disclosure standard and that his failure to comply was an oversight. Mr Mott met with Mr Laws in late November 2006 and discussed compliance with the standards,in particular the disclosure standard. Mr Laws said to Mr Mott that he was aware of the requirements of the disclosure standard and was "... doing everything possible to comply with them". On 14 March 2007 Mr Mott wrote to Mr Laws informing him that since 4 February 2007 the Act had been amended (i.e. by the 2006 amendments) so that the Authority had additional enforcement powers including the power to seek civil penalty orders and to accept enforceable undertakings. Mr Mott wrote that the imposition of a civil penalty would be a matter of grave concern to Radio 2UE and would bring it into disrepute. He said his purposes in writing were to remind Mr Laws of his contractual obligation to comply with the standards made under the Act, to notify him formally of the Authority's new powers and to inform him that Radio 2UE would consider its rights under their contract with him should he fail to comply with the standards. Mr Mott noted that the Authority's investigation into the 28 August 2006 breaches was continuing and his letter was not a waiver of Radio 2UE's rights. He wrote that he wanted to highlight to Mr Laws how seriously Radio 2UE regarded compliance with the standards. Mr Mott told Mr Laws that any further breaches of the disclosure standard would be unacceptable to Radio 2UE. He said that Radio 2UE had a right to terminate the contract for a breach of Mr Laws' obligation to comply with the standards and, if such a failure occurred it would consider its rights. After the second conversation Mr Mott flew to Melbourne to report to Mr Bell on his discussions with Mr Laws. On 11 May 2007 the Authority provided Mr Bell with a draft report on its investigation of the 28 August 2006 breaches and, pursuant to the Act, afforded Southern Cross Broadcasting with an opportunity to comment. South Cross Broadcasting responded to the draft report on 28 May 2007. Around the beginning of June 2007, Mr Laws informed Mr Bell, of his intention to retire from on-air presenting. Mr Laws met with and told Mr Mott of this on 6 June 2007. They agreed that Mr Laws' last day on-air would be 30 November 2007. Under the contract, Mr Laws could retire on giving 6 months notice and this date would coincide with the end of the calendar year season in the industry, which would allow sufficient time to arrange for Mr Laws' replacement in an orderly way. Mr Mott also agreed to this period of notice because Mr Laws also had not committed any further breaches of the disclosure standard since 28 August 2006. He gained confidence from this that Mr Laws was taking his obligations to make disclosure announcements seriously and had reformed. On a number of occasions Mr Mott suggested to Mr Laws that he should disclose his commercial agreements simply and in a positive way. He told Mr Laws that by mentioning a sponsor or their product and then making a disclosure statement in a negative manner, the negativity reflected back onto the sponsor or their product. Mr Mott formed the view from these discussions that Mr Laws genuinely accepted that he was doing a disservice to the sponsors by being negative when making disclosure statements. Mr Laws expressed the view to Mr Mott on a number of occasions between 14 March 2007 and 6 June 2007 that on-air presenting had become harder over the previous few years largely as a result of the obligations placed on him by the disclosure standard. Mr Mott believed from his meetings and conversations with Mr Laws after 28 August 2006 that the pressure which he and other senior executives in Southern Cross Boadcasting, including Mr Bell and Mr Olding had exerted on him in respect of his history of non-compliance with the disclosure standard, had played some part in his decision to retire. On 25 June 2007, Mr Laws announced on his program that he was retiring from on-air presenting. Mr Mott said that Southern Cross Broadcasting considered itself to be in a caretaker role of the parts of its commercial radio network that were to be sold pending completion of that acquisition in early November 2007. On 24 September 2007, Radio 2UE gave an enforceable undertaking to the Authority pursuant to s 205W of the Act. The system will include a requirement that, in the event that a disclosure announcement of the kind described in section 7(3) of the Disclosure Standard is not made in accordance with section 7(1) of the Disclosure Standard, 2UE will take action to cause such a disclosure announcement to be broadcast at the earliest opportunity in that program, and will report in writing to ACMA within 72 hours of such failure to comply with the Disclosure Standard, providing details of the non-compliance and of the action taken. The first fortnight will commence on the Sunday following the commencement of this undertaking. 2UE will provide recordings of the programs to the independent person and, if requested by the independent person or ACMA, provide transcripts of those recordings. The independent person appointed will prepare a report on compliance with section 7 of the Disclosure Standard, based on the review of the programs. The independent person appointed will provide a copy of each report to ACMA within 14 days of the end of each fortnight. It had to "implement an effective administration system for monitoring each broadcast" of Mr Laws' program to ensure compliance with cl 7 of the disclosure standard. Next, on 25 September 2007, the Authority published its report on the 28 August 2006 breaches. The findings that report would make when published had led to Radio 2UE giving its enforceable undertaking. Radio 2UE had to monitor Mr Laws' program under cl 4.1(a) from 1 October 2007. It appointed an independent reviewer on 4 October 2007. (I have used the numbering of the order of the contraventions set out in [13] of agreed facts in these reasons. ) Contravention 1 involved Mr Laws mentioning a sponsor on-air but failing to make a disclosure announcement until 90 seconds later in the broadcast. Contravention 6 involved a caller, on Mr Laws' talkback radio session, mentioning a sponsor on-air and then Mr Laws failing to make a disclosure announcement until 10 minutes later in the broadcast. John did ring the bell but failed to declare Toyota as sponsors of his. Ten minutes later at 11:33am,[sic] obviously reacting to prompting John said "did I say Byron Bay Beer are sponsors of mine? I think I did" followed by a rant about being monitored . Contraventions 2, 4, 5, 7, 8, 11 and 12 also involved callers who made an on-air mention of a sponsor during a talkback radio session in Mr Laws' program. Contravention 8 occurred on Friday 26 October 2007 at 11.51 a.m. in a segment of Mr Laws' program called " The Best of the Lawsy Week ". On that occasion a recording of contravention 7 taken from the previous Wednesday's program, was replayed. That segment, I infer, was a collection of recordings from earlier in the week that Mr Laws, or those producing his program, considered sufficiently memorable or significant that they were repeated. Thus, whoever chose to repeat contravention 7 was reckless about the disclosure standard. This was not a mere failure of the internal monitor or Mr Laws. Rather, it demonstrated the absence of any real understanding within those responsible at Radio 2UE for compliance on Mr Laws' program with the disclosure standard. Contravention 8 should never have occurred because it was part of a pre-recorded segment that had been chosen for repetition. Norman was the caller that rang us on Wednesday howling against just about everything we do on this program. He didn't like my alleged bias ... I don't know what bias he referred to ... he didn't like the fact that I'd been reasonably successful and he didn't like the fact that I'm an ambassador for Hamilton Island. As you know Hamilton Island are sponsors of mine and I think in the heat of the moment ... maybe we didn't mention that the other day, but of course we live in this environment of total terror and we have to say that Hamilton Island are sponsors of mine in order to appease the Nazis and also to appease the terrified management of this broadcasting station. I hope you are now all duly appeased. We can get on with our lives. At least just for four more weeks, JUST LEAVE ME ALONE (cuts to music). I will return to the content of that statement below. In fact, Mr Ruhfus had written to the Authority late in the afternoon of 26 October 2007, the day of the broadcast on which contravention 8 occurred, drawing its attention to Mr Laws' failure to make a disclosure. I do not consider that statement to have been sufficiently close in time to have any palliative effect. The final contravention (13) occurred at approximately 11.25 am on Mr Laws' last 35 minutes of presenting before his retirement was to occur. He had just finished talking to the well known singer, Normie Rowe, who had mentioned Byron Bay Beer. When are you people going to get over it? Never? What are you going to do next week when you don't have to sit around and listen to me all day in case I say Toyota? [pause] Oh did you hear that, Alice? He said Toyota! God! Boring old bastards! 13 13 32 is our telephone number. [pause] No, not our people here, the people at the ... whatever you call it, what do you call it? ACMA. As I said yesterday, it sounds like a skin ailment. In addition, the parties submitted that those orders would be a specific deterrent to Radio 2UE. The joint submissions addressed a number of issues, and these were elaborated upon or supplemented by further submissions of each of the parties and the Centre. In determining a pecuniary penalty under s 205F(3) the Court is not confined to considering any of the four particular matters referred to in subparagraphs (a) --- (d). Rather, as the chapeau to s 205F(3) provides, the task is to "have regard to all relevant matters". There is a degree of overlap in the considerations relevant to s 205F(3)(a) and (c). It is not easy to segregate a matter as being wholly within one or the other of those two subparagraphs. In my opinion it is not necessary to make any bright line segregation, so long as any matter which is itself relevant is considered in accordance with s 205F(3). 1. These included compliance with the disclosure standard. The Centre argued, and the Authority accepted, that the disclosure standard was a cornerstone on which the responsibility of the licensee to the public was built. The Centre argued that the seriousness of the contraventions was underlined by the 23 related breaches of the enforceable undertaking to which I have referred above. The joint submissions recognised that the enforceable undertaking was a relevant matter to take into account as one of the circumstances in which the contravention occurred for the purposes of s 205F(3)(c). I accept that that is so. The Centre argued, and the Authority accepted, that a licensed broadcaster enjoyed a position of public trust and that the community was entitled to have confidence in the honesty and candour of broadcasts by a licensed commercial broadcaster. The Centre also argued that it was vital in a democratic society that citizens be able to obtain reliable news, information and editorial commentary from trustworthy sources. The Centre contended that, in that context, members of the audience would then be in a secure position to decide what weight to give to news, current affairs and commentary received from various reliable sources. The Centre argued that the community was entitled to expect that commercial broadcasting radio licensees would adhere to the ground rules for conduct of their licence, including the disclosure standard so as to present their programs without hidden bias or hidden interests influencing the discussion. It argued that without the disclosure of the presenters' interests, the interests of his or her undisclosed sponsors would be served and that it was important to maintain a proper distinction between advertisement and editorial comment. It argued that compliance with the disclosure standard was critical for that purpose. And, the Centre argued that a failure to comply with the disclosure standard prevented or impeded the fair and accurate coverage of matters of public interest contrary to the object expressed in s 3(1)(g) of the Act. The Centre argued that the fact that the 13 contraventions involved commercial products and services did not detract from its argument. It said that information about those products and services influenced the public's views about them which in turn informed their attitude towards social, economic, commercial and political conditions. Products and services were, it contended, part of the public's day to day lives and these were not unimportant. The Centre also argued that the community knew that commercial radio broadcasters such as Radio 2UE were regulated and would assume that what they heard on Radio 2UE complied with the regulatory regime in place. It argued that the contraventions were a serious breach of the public trust which the community was entitled to repose in commercial radio broadcasting licensees adhering to the conditions of their licences. It also argued that undisclosed sponsorship and endorsements had an adverse affect on the market for the relevant goods and services. The Centre argued that an undisclosed sponsorship or endorsement implied that the presenter had a particular preference for the goods or services of a trader, as opposed to those of a competitor, and used his position of experience to persuade consumers to purchase in accordance with the recommendation, which was not his or her own genuine opinion, but a recommendation that had been purchased. The Authority contended that the proceedings for a penalty were in aid of protecting the public interest which the disclosure standard was created to protect. It argued that a primary question was whether or not a penalty was within a range adequate to deter the respondent and others from further contraventions of the standard. The Authority argued that in arriving at the agreed penalty it had considered the relevant objective and subjective factors, the importance of deterring Radio 2UE and the need to alert others to comply with the disclosure standard. It also noted that there had been a marked difference in the compliance culture and record of Radio 2UE since it came into new ownership. The Authority argued that the agreed penalty had regard to the number of breaches, their seriousness and Radio 2UE's persistence in them, rather than the nature of the individual breaches themselves. If there were a large number of such breaches which were potentially more damaging to the public interest in transparency, the Authority has other sanctions to impose in the event that it considers a pecuniary penalty at the upper end of the range is not sufficient, by itself, to deal with the contraventions of the Act. If there were a large number of contraventions, a penalty at the high end of the range would simply increase proportionately to the number of contraventions. Moreover, the Authority will be guided by the views of the Court in these proceedings where it has had the benefit of having a contested argument on the penalty to be imposed. The Centre argued that the parties had not explained in their submissions why, applying the proper principles, the agreed penalty was appropriate. It pointed to the public nature of the licence and the right and opportunity a licensee had to operate a commercial broadcasting business based on the exploitation of the public asset being the radio spectrum. The Centre argued that the penalty should be in the upper half of the range and thus significantly higher than the agreed sums. It argued that the agreed penalty did not give adequate weight to the public interest aspects of the agreed facts and the surrounding background circumstances. Radio 2UE argued that the joint submissions had identified the Authority's concern about Mr Laws' inappropriate attitude to the disclosure standard and the failure by Radio 2UE to comply with it, but submitted that there were substantial mitigating factors warranting a lower penalty. Radio 2UE argued that there was a public interest in bringing the litigation to a speedy resolution resulting in savings of resources for the Authority and the Court: Mobil (2004) ATPR p41-993 at 48,624 [41] and 48,627 [53]. However, as Branson, Sackville and Gyles JJ said there, arguments in favour of the negotiation of settlements have to take account of the fact that it is the Court that bears the ultimate responsibility for determining the appropriate penalty: Mobil (2004) ATPR p41-993 at 48,627 [53]. 2. They pointed to the fact that Mr Laws ceased to be an on-air presenter for Radio 2UE following his retirement on 30 November 2007. And, the parties submitted that it was relevant that Fairfax Media acquired Radio 2UE on 9 November 2007 and that only the last four contraventions occurred after that time and then on the last day of Mr Laws' career. The Authority argued that Mr Laws' commercial agreements were recorded on the register and there were various on-air disclosures even though not all of them were compliant with the disclosure standard. It argued that Mr Laws has now retired and there was no specific deterrent necessary for his conduct. It argued that the new compliance regime adequately addressed the concerns arising from the previous regime. The Authority noted that Radio 2UE had not deliberately engaged in the conduct and had taken steps to prevent it. It accepted that Radio 2UE had acted bona fide, even if it had been ineffectual, in seeking to regulate Mr Laws. Radio 2UE also argued that it was necessary to take everything into account before arriving at a penalty. The last day of Mr Laws' broadcasting was one in which the compliance system failed to bring about an end to his contraventions. The particular contraventions did not, so Radio 2UE argued, go to the heart of freedom of speech and the other important objectives of the Act. 3. Neither Radio 2UE nor the Authority has received any claim or demand from a third person in relation to any alleged loss or damage suffered by them. That is hardly surprising since the nature of the breaches of the disclosure standard were unlikely to cause any loss or damage. However, the parties acknowledged that the absence of such loss or damage was not itself a mitigating factor. I accept this submission. 4. It required Radio 2UE to implement an administrative system to ensure compliance by Mr Laws' program with the disclosure standard and that the first contraventions took place on 5 October 2007. The parties relied on the fact that Radio 2UE had engaged an internal monitor as part of its administration system. The sole function of the internal monitor was to monitor Mr Laws' program and ensure compliance with the disclosure standard by prompting him or the executive producer, if disclosures were not made appropriately. The parties relied on Mr Mott's evidence of his belief that this would be an effective administration system. In addition, the Authority had approved the general framework of that system and also believed it would be effective to ensure compliance. The joint submissions noted Radio 2UE's concession that, with the benefit of hindsight, the administration system was not effective. They submitted that the internal monitor was not adequately experienced or trained and, among other things, Radio 2UE should have appointed another person to review the recorded broadcast, after the live to air program, as occurred when the independent reviewer listened to pre-recordings. The parties also submitted that during the period in which the contraventions occurred Radio 2UE had a compliance policy and had provided training to Mr Laws and all staff working on his program in addition to the annual training that they received. They submitted that the contraventions occurred due to human error, being oversights of Mr Laws, the staff working on the program and the internal monitor. The Centre argued that the 13 contraventions occurred in circumstances where Radio 2UE had not taken its obligations to establish a compliance system sufficiently seriously. The Centre argued that the obligation of a commercial radio broadcasting licensee to comply with the disclosure standard was critical to its entitlement to remain licensed. In that context, and in light of the failure of Radio 2UE's previous attempts to comply with the disclosure standard, the giving of the enforceable undertaking and Mr Laws evident dislike of the requirements of the disclosure standard, the Centre contended that the appointment of the person who was the internal monitor for Mr Laws' program was not sufficient. The Centre did not intend to criticise the appointee. Rather, it argued that because he was not sufficiently senior it could not be expected that he would be able to ensure that Mr Laws complied with the disclosure standard. The Centre argued that having regard to Mr Laws' recidivism in respect of his previous contraventions of the disclosure standard, Radio 2UE should have made a substantially more serious effort to ensure that Mr Laws complied in the future at the time of the giving of the enforceable undertaking. It argued that ordinary businesses would take measures of sufficient strength to ensure that they would continue to be able to meet the conditions of a commercial broadcasting radio licensee's major resource, namely the continued entitlement to hold, and operate under, the licence. Radio 2UE argued that the Centre's criticisms of its compliance system were made without any evidence and simply reflected hindsight. It argued that the Centre's submissions ignored that the Authority had been aware of and approved the compliance system introduced at the time of the giving of the enforceable undertaking with the awareness and approval of the Authority. The parties relied on the evidence that after all the contraventions had occurred, Radio 2UE had implemented a number of significant changes to its compliance policies. They submitted that they expected that those changes would improve Radio 2UE's future compliance with the disclosure standard when coupled with the deterrent effect of the penalty to be imposed in these proceedings. The parties submitted the sentencing purpose of deterrence would be served where a lower penalty was imposed if it would lead to the contravenor's future compliance because of further steps it had taken, such as effective and efficient improvements to its compliance system. 5. However, the parties acknowledged that the Authority and its predecessor had previously conducted investigations into breaches of the disclosure standard by Radio 2UE in relation to Mr Laws' program, and that the results of those investigations in 2003 and 2006 had been set out in [11] and [15] of the agreed facts. As I have said, the other evidence suggests that the 28 August 2006 program involved a significant number of contraventions of the disclosure standard. Radio 2UE said that the Court could not consider historical events prior to August 2006, beyond the material in the agreed facts in the joint submissions. However, I consider that it is appropriate to have regard to the whole of the evidence, and the explanatory memorandum before the Parliament, which the parties provided, leading to the enactment of the 2006 amendments. And, as Radio 2UE accepted, the disclosure standard was introduced as a result of the historical events involving Radio 2UE and Mr Laws, among other presenters, including the 2000 enquiry by the Authority's predecessor. On the other hand, I accept Radio 2UE's argument that the Centre was not granted leave, as intervenor, to tender any evidence and is not entitled to rely on material outside the evidentiary context, or the Parliamentary materials. 6. The comments on 29 October related to both contraventions 7 and 8. I have dealt with Mr Laws' inappropriate comments of 29 October and 30 November above at [79]-[81]. The parties submitted that Mr Laws was aware of the requirements of the on-air disclosure. I am satisfied that this is correct. They then argued that he had indicated publicly on-air that his view of the requirement was that it was "excessive". They argued that it was relevant to note that contravention 8 occurred before Fairfax Media acquired Radio 2UE and contravention 13 on Mr Laws' last day. Nevertheless, it is submitted that the proposed penalty is sufficiently substantial to alert others that the on air disclosure requirement must be complied with. 7. I will consider this submission in detail later. 8. The joint submissions also referred to Radio 2UE's comprehensive compliance policy that is now in place. The submissions acknowledged the earlier policy had been ineffective in preventing the contraventions. Since then Radio 2UE has undertaken a number of steps to ensure that similar contraventions do not occur. The joint submissions pointed to a number of matters, including the new parent company, Fairfax Media, undertaking a complete review of the compliance program and updating manuals and training materials. And, they noted that contracts for presenters are being reviewed and a new clause has been inserted in renewed or new contracts enabling Radio 2UE to suspend presenters in circumstances where a breach of contract is suspected, including a contravention of the disclosure statement. The joint submissions also noted that a new general manager had been appointed to Radio 2UE in January 2009 and he has over 20 years experience in the radio industry in senior positions. Fairfax Radio Network appointed a member of its legal unit to ensure regulatory compliance by Radio 2UE and she has had previous experience with Southern Cross Broadcasting's legal team. In September 2008 Radio 2UE began a new internal intranet capable of being accessed by all its staff, that includes copies of the compliance policy, the standards made under the Act and Codes. In February 2008 Radio 2UE placed a time frame on presenters having to disclose their commercial agreements or amendments to existing ones. It also undertook a number of reviews of compliance with notifications for commercial agreements. The Authority expected that those steps would improve the compliance environment within Radio 2UE and will have the result of improving its compliance culture. 9. The Authority accepted that this co-operation had occurred both through Radio 2UE and its ultimate holding companies. They submitted that the expense of a contested hearing was averted by the co-operation of Radio 2UE and its parent companies, Southern Cross Broadcasting and Fairfax Media, demonstrating a willingness to accept responsibility and facilitate the course of justice. In addition, the parties relied on Radio 2UE's admissions of the contraventions, as acknowledgement of liability and co-operation with the Authority, its contrition and its commitment to improving its compliance program and continued introduction of measures to improve that program. The Authority also argued that the Centre's submissions did not take into account what it contended was the significant public interest promoted by Radio 2UE admitting liability before the proceedings were even commenced. Radio 2UE also argued that there was a public interest in not imposing a penalty that was oppressive having regard to the compliance measures subsequently put in place and the views of the authority as to their appropriateness. 10. There were two classes of breach of the enforceable undertaking, one being 12 instances where Radio 2UE had not taken action to broadcast a disclosure after a non-disclosure by Mr Laws, the second being 11 instances where Radio 2UE had not reported the failure to disclose and the action it had taken to the Authority within 72 hours. Those additional matters are not the subject of this application for civil penalties. The Centre argued that the Authority had conflated each of those 23 additional matters with the 13 breaches of cl 7(1). I do not consider that in these proceedings it is appropriate to punish Radio 2UE by imposing a heavier penalty for the 13 contraventions because of its further breaches of the enforceable undertaking. The circumstances in which those further breaches occurred are nonetheless relevant, in accordance with s 205F(3) of the Act, for the purpose of assessing the conduct of Radio 2UE, because of their contemporaneity and interrelation with the 13 contraventions and the extent to which they went unremedied: cf Weininger v The Queen [2003] HCA 14 ; (2003) 212 CLR 629 at 640 [32] per Gleeson CJ, McHugh, Gummow and Hayne JJ. 11. It relied on the context of the Parliament's decision to expand the potential remedies available to the Authority. Under s 143(1) the Authority was given power, by notice in writing, to suspend a licence for such period, not exceeding three months as was specified in the licence or to cancel the licence where a commercial radio broadcasting licensee breached a condition of the licence. In addition, s 205X provided the Authority with power to apply to the Court, where a person had given an enforceable undertaking under s 205W that the Authority considered had been breached, for orders that included any order that the Court thought appropriate (s 205X(2)(d)). The Centre argued, that accordingly, the Authority had formed the view that it would proceed with the less drastic remedy of seeking pecuniary penalties under s 205F and declaratory relief. The Authority and Radio 2UE both argued that the availability of other sanctions was not relevant to the quantum of a civil penalty to be imposed and that Radio 2UE should not be penalised more severely because of the existence of other enforcement remedies which the Authority chose not to employ. I accept that submission. 12. Moreover, the Authority argued that its contacts with industry gave it an insight into the level of penalty which would be seen as a sufficient deterrent to avert other breaches. The Authority accepted the submissions made by the Centre that there was a significant public interest in radio presenters of current affairs program not having undisclosed sponsors. The Authority argued that the protection of the public interest was not an independent factor which had to be given weight when assessing the penalty along with other relevant factors, but simply the outcome of the penalty process. Radio 2UE also contended that weight should be given to the Authority's views that the publicity surrounding the contraventions as well as the amount of the proposed penalty of $130,000 in total would operate to deter future breaches by both itself and other licensees and heighten awareness of the requirements of a disclosure standard. And, Radio 2UE contended that it had considered the possibility of terminating Mr Laws' contract after the 2006 contraventions, but did not do so based on senior counsel's advice. This showed, it argued, that it had taken those breaches sufficiently seriously. The Centre argued that the agreed penalties would not be an effective sanction nor credible in the eyes of the community. Radio 2UE disputed the Centre's arguments that the joint submission had not given sufficient attention to public interest considerations. Radio 2UE also argued that while the history of Mr Laws' contraventions of the disclosure standard provided a context they should not be given undue weight. It was not liable in these proceedings to a penalty for its prior conduct. Rather, it argued that it had demonstrated its responsibility by bringing Mr Laws' contraventions in August 2006 to the Authority's attention. And it argued that the occurrence of the 13 contraventions after, and in breach of the enforceable undertaking, should not be seen as an aggravating circumstance. It argued that it took about 12 months work between Radio 2UE and the Authority to arrive at a compliance system to satisfy the Authority that the enforceable undertakings were acceptable. But that is the ordinary standard for such broadcasting to meet. The disclosure standard applies and is enforced as a condition of the licence. The enforceable undertaking was offered by Radio 2UE as a means of satisfying the Authority that, despite Mr Laws known recidivism in relation to the disclosure standard, Radio 2UE would take appropriate measures to prevent recurrence. I reject the parties' submission that the contraventions arose at a lower level of management. Persons in the position of Mr Laws were recognised by s 4(1) of the Act to be in a position to shape community views in Australia. Mr Laws was a well-known and seemingly influential "star". His views and endorsements appear to have been so significant that he could invite the Prime Minister to appear on his show to discuss current affairs (such as the occasion which led to the enforceable undertaking). As the Centre pointed out in its submissions, the ability of the media, including radio, to influence public perceptions of events is significant. Radio 2UE had a privilege conferred on it under the Act to conduct a broadcasting service on the public radio spectrum. Conditions of its licence required it to ensure that the disclosure standard's requirements were met. Mr Laws had significant and valuable commercial agreements with six different sponsors in 2007. I infer that those sponsors saw considerable benefit to their businesses in having Mr Laws refer to and promote their names and brands, products or services in as favourable light as possible. It can also be safely inferred that he was seen by his sponsors to be able to use Radio 2UE's licence to influence public awareness and opinion with respect to their own products or services (see s 4(1) of the Act). Material which is designed or calculated to draw public attention to a person, product or service or to promote its use may constitute an advertisement: Director of Public Prosecutions v United Telecasters Sydney Ltd [1990] HCA 5 ; (1990) 168 CLR 594 at 598 per Brennan, Dawson and Gaudron JJ, 605 per Toohey and McHugh JJ. And, Radio 2UE was conscious that Mr Laws was not only able to use its licence in this way, but that he had done so. Section 140A(3) in terms, imposes liability directly on a licensee by requiring it not to breach a condition of its licence set out in cl 8(1) of Sch 2 to the Act. That liability is not a vicarious liability imposed on Radio 2UE for the conduct of its presenters, but a direct liability on it: Hamilton v Whitehead [1988] HCA 65 ; (1988) 166 CLR 121 at 127-128. There, Mason CJ, Wilson and Toohey JJ held that when an employee acted in the course of his or her employment he or she did so as the embodiment of the corporate employer: Hamilton 166 CLR at 127; Tesco Supermarkets Ltd v Nattrass [1971] UKHL 1 ; [1972] AC 153 at 170 per Lord Reid. Under s 140A(3) a corporation will incur liability for what its agent, Mr Laws, did or failed to do to comply with the disclosure standard. This is because Mr Laws was acting as the licensee when using its licence to broadcast his program. It is not a case of a company being made liable for an act performed by a servant of the company on its behalf. The liability imposed is direct, not vicarious. The distinction was drawn by Viscount Haldane LC in Lennard's Carrying Co Ltd v Asiatic Petroleum Co Ltd ([1915] AC 705 at p 173). A living person has a mind which can have knowledge or intention or be negligent and he has hands to carry out his intentions. A corporation has none of these: it must act through living persons, though not always one or the same person. Then the person who acts is not speaking or acting for the company. He is acting as the company and his mind which directs his acts is the mind of the company . There is no question of the company being vicariously liable. He is not acting as a servant, representative, agent or delegate. He is an embodiment of the company or, one could say, he hears and speaks through the persona of the company , within his appropriate sphere, and his mind is the mind of the company. If it is a guilty mind then that guilt is the guilt of the company. It must be a question of law whether, once the facts have been ascertained, a person in doing particular things is to be regarded as the company or merely as the company's servant or agent. In that case any liability of the company can only be a statutory or vicarious liability. He was its managing director and his mind was the mind of the company. The company therefore was liable as a principal for the breaches of s 169 of the Code. The liability was direct, not vicarious. The joint submissions appeared to divide Mr Laws' responsibility for breaching the disclosure standard from that of Radio 2UE. In my opinion, this is a fundamental misconception. When Mr Laws committed each of the contraventions complained of, he was Radio 2UE. He was not merely an agent or minor employee for whose acts or omissions Radio 2UE was vicariously responsible. Rather, Mr Laws was the embodiment of Radio 2UE using its commercial radio licence to promote, or assist the promotion of, his sponsors or their products or services. The fact that, on some occasions, a caller mentioned the sponsor's name did not derogate from this consequence. Rather it appeared to have been part of Mr Laws' program to engage in discussion about his sponsors, their products and services. Listeners to commercial radio licensees' programs may not able to know how it came to be that a caller mentions one of a presenter's sponsor's name, product or service. The caller could be an agent of the sponsor or the presenter, for all the listening audience would know. But, I have no doubt that Mr Laws knew the names, products and services of his sponsors and that, if one of these was mentioned by him, a guest or caller on his show, he had an obligation to make a disclosure statement at the time of that mention. He knew that this was a condition of Radio 2UE's licence and that the Act required Radio 2UE and himself to comply with the disclosure standard. Mr Laws was Radio 2UE's "star", its means of earning substantial advertising revenue by attracting listeners to his show. The fact that he could earn substantial sums himself, from sponsors under commercial agreements, demonstrated just how valuable he was to the enterprise of Radio 2UE. His conduct in using the licence was a central element of each of the 13 contraventions. That unlawful conduct is not addressed in an appropriate way by the agreed penalty. One reason that the Parliament enacted the civil penalty and enforceable undertaking provisions in the 2006 amendments was to overcome the difficulty in enforcing criminal sanctions under the Act in respect of previous contraventions of the disclosure standard specifically by Mr Laws. And that standard itself had been made, in part, as a result of his yet earlier conduct. The parties' submissions treated Mr Laws' conduct as of relatively lesser importance in fixing a penalty than the other factors they addressed. I consider that Mr Laws' conduct and his role in the contraventions are fundamental to the fixing of a penalty. Radio 2UE complied largely with the form of the enforceable undertaking, but not with its substance. Neither Mr Mott nor Mr Ruhfus read any of the independent reviewer's reports for the periods during which the 13 breaches of the disclosure standard the subject of these proceedings occurred. The reports were sent by email to the Authority, Mr Mott and Mr Ruhfus and I infer, since they were received by the three recipients, at the same time. These reports identified a number of failures by Radio 2UE, through Mr Laws, to broadcast disclosure announcements. The format of each report consisted of a short two page summary, identifying the 4 days monitored, statements as to the degree of compliance by Mr Laws with his disclosure obligations in live reads of advertisements, the incidental mention of his sponsors or their products and the reviewer's conclusion of any failure to disclosure. For example, in the report dealing with the 4 days she monitored in the 14 days ending 26 October 2007, the independent reviewer noted each of the five contraventions on 18 and 24 October 2007. The reviewer provided that report on 29 October 2007. The reviewer's next report for the period ended 9 November 2007 identified the contravention on 2 November 2007. That was the last contravention before 30 November 2007. Mr Mott did not recall receiving the independent reviewer's reports but accepted that he must have received the emails forwarding them to the Authority, Mr Rufhus and him. Mr Mott's usual practice was to review all emails sent to him and he was surprised by his failure to do so in respect of these reports. However, Mr Mott was sure that he did not read those reports in 2007 and that Mr Ruhfus did not bring them or their contents to his attention. Mr Mott considered that his heavy work load at the time was the likely reason for his not having read the reviewer's reports. Mr Ruhfus did not give evidence. Mr Mott was the most senior of Southern Cross Broadcasting's employees who were to transfer to the Fairfax Radio Network as part of the latter's acquisition. Mr Mott said that he had a heavy involvement in the transaction as the time for completion approached. He was involved in a number of meetings and was away from his Melbourne office for extended periods of time. I am satisfied that he was very busy during this period. He received many emails in respect of the transaction and, on completion on 9 November 2007, he changed his email address, so that after then he had to access two different addresses for his work related emails. Radio 2UE relied on these pressures on Mr Mott during October and November 2007 as explaining his failure to read any emails from the independent reviewer appointed under the enforceable undertaking that drew attention to Mr Laws' breaches of the disclosure standard in that period. Mr Mott accepted, he said with the benefit of hindsight, that he and Mr Ruhfus ought to have focussed on the content of the independent reviewer's reports and taken action in respect of the non-disclosures they revealed. He said that action should have included raising those matters directly with Mr Laws. Mr Mott also reflected on other reasons why the 13 breaches occurred in late 2007. He said that Mr Laws' 6 commercial agreements were the most any on-air presenter had. Mr Mott speculated that the significant number of sponsors and the number of products each of them had "would have made it very difficult for Mr Laws to make the disclosure announcement each and every time the sponsor [or] their products were mentioned". Mr Laws had explained his earlier breaches as an oversight. Mr Mott said that owing to the nature of live radio, once an oversight occurs, it will only be rectified if it is noticed and someone causes Mr Laws to make a disclosure statement. Mr Mott said that Mr Laws' attitude to complying with the disclosure standard was "... at certain times negative and this made it difficult for staff of [Radio 2UE] to ensure that he consistently complied with ..." that standard. Mr Mott said that on a number of occasions between 1 October 2007 and 30 November 2007 he enquired of Murray Olds, the executive producer of Mr Laws' program, whether the new system was working and that Mr Olds told him that the internal monitor had prompted both Mr Laws and Mr Olds of the need to make disclosure announcements. Mr Mott said that this led him to believe that Mr Laws was fully complying and that the new administration system for the enforceable undertaking was also working. Mr Mott only learnt of the 13 contraventions in late February 2008. If Mr Mott or Mr Ruhfus had read the independent reviewer's reports when received, as they should have, the deficiencies in the internal systems would have been apparent to them. The internal monitor was trained in part before 1 October and he was retrained by Mr Olding on 4 October 2007, the day before the first two contraventions. Moreover, the internal monitor was not the only person who had responsibilities. Mr Laws had the primary responsibility. It was part of his job. He disliked the obligation, as the independent reviewer's description of his "rant" on 24 October and his behaviour on 30 November 2007 showed. Mr Olds and the other production staff for the program must also have been well aware of the disclosure standard and Mr Laws' commercial agreements with his sponsors. Mr Mott said that he and Mr Olding had given additional training to Mr Laws, Mr Ruhfus and the production staff as recently as 28 August 2007. Each of those persons had an hour's training and they received copies of Radio 2UE's printed booklet setting out its compliance policy and the relevant requirements of the Act and standards with which they had to comply. I do not accept that any of the 13 contraventions arose because Mr Laws overlooked that he or a caller had mentioned a sponsor or one of its products of services. First, there was no evidence from him that he did "overlook" any of those mentions or his duty to make a disclosure announcement. Secondly, he was paid a large amount by each sponsor and it was his responsibility to be aware of the consequence of mentioning their names, products or services. He controlled the content of his program and encouraged his callers to mention his sponsors, their products and services. I infer that one significant reason for the 13 contraventions was identified by Mr Mott in his last reason; namely that Mr Laws resented having to make disclosure announcements and he made it hard for the staff to remind him of the need to make one when he had omitted to do so. But this attitude and the problems that it had caused Radio 2UE over the past years was known to senior management of Radio 2UE including Mr Mott. Radio 2UE chose to take the risk of breaching the law through the faith it placed in, and lack of appropriate steps to control the on-air conduct of, its presenter, Mr Laws, knowing of his earlier failings. I reject the argument that Mr Laws' failures were "careless". His failures to disclose were made by a professional presenter being paid over $400,000 p.a. by these sponsors to mention their names, products and services. He was well aware of the disclosure standard. I am not prepared to accept his failures as "careless" or "oversights" in the absence of evidence from Mr Laws. At least a portion of Mr Laws' programs on each of the relevant days involved discussions with his callers about his sponsors or their products or services. In other words, the mention of the sponsors, their products or services was an integral part of Mr Laws' program. This may explain why the sponsors (other than Byron Bay Beveridges) were prepared to pay in excess of $100,000 each for Mr Laws to promote them. They may have received value for their money. But the relevant price for that was the duty of Radio 2UE to see that Mr Laws complied with the Act, the licence and his contract. His assertions that this duty created an "... environment of total terror" and that his obligation to comply with the law was "in order to appease the Nazis and also to appease the terrified management of this broadcasting station" demonstrated a disturbing disregard for his obligations, and the privilege that his use of Radio 2UE's license gave him. Mr Laws was a professional presenter. But, he was a recidivist with respect to complying with the standard. His statement, when he made his announcement on 29 October 2007, that "maybe we didn't mention" the name of the sponsor on the previous occasion is not evidence I would accept of any carelessness. The terms of Mr Laws' purported disclosure announcement made on 29 October 2007 should have raised concerns for the management at Radio 2UE about, first, his continuing resentment of having to comply with the disclosure standard and, secondly, whether the monitoring system would be effective. There was no evidence to explain the circumstances in which the announcement of 29 October 2007 came to be made (other than the inference that Mr Ruhfus, having sent the letter to the Authority, asked Mr Laws to make it) or, what, if anything, was done after it to ensure compliance by Mr Laws. And, contravention 13 was not careless; it was a deliberate contravention made with the intention of bringing the disclosure standard into contempt. Radio 2UE committed the contraventions because it allowed Mr Laws to present his program and to make the statements that he did without any proper control to stop him. When he was broadcasting, Mr Laws was Radio 2UE for the purpose of the disclosure standard. Radio 2UE has given substantial attention to developing effective compliance programs since the contraventions and both it and the Authority consider that these will be effective in reducing the risk of future contraventions of the disclosure standard. While Radio 2UE is entitled have the penalties mitigated because of its responses to the contraventions and its good faith in its ineffective attempts to comply with the disclosure standard, it cannot relieve itself of the gravity of its contravening conduct (being the conduct of its presenter, Mr Laws). It may have its own remedies in contract for damages against Mr Laws for his breaches. Had Radio 2UE told Mr Laws that it would seek to hold him liable for damages for breach of contract in the event that it incurred costs of any investigations into a contravention by him of the disclosure standard and the amount of any pecuniary penalty imposed, it is likely that he would have been far more concerned to comply with the law. At common law the fact that an accused person has pleaded guilty is a matter properly to be taken into account in mitigation of his or her sentence in a criminal proceeding. That is because it is usually evidence of some remorse on the part of the offender, and secondly, an acceptance of responsibility. It may also indicate a willingness to facilitate the course of justice: see Cameron v The Queen [2002] HCA 6 ; (2002) 209 CLR 339 at 343 [11] - [14] per Gaudron, Gummow and Callinan JJ. In Mornington Inn Pty Ltd v Jordan [2008] FCAFC 70 ; (2008) 168 FCR 383 at 404-405 [73] - [76] , Stone and Buchanan JJ considered the applicability to civil penalty proceedings of the common law principle of affording a discount to a sentence imposed after a plea of guilty. Stone and Buchanan JJ concluded that the rationale for providing a discount for an early plea of guilty in a criminal case did not apply neatly to a case where a civil penalty is sought and the case proceeded on pleadings. They said, that nonetheless, it should be accepted for the same reasons as given in Cameron [2002] HCA 6 ; 209 CLR 339 , that a discount should not be available simply because a respondent has spared the community the cost of a contested trial. They held that the benefit of such a discount should be reserved for cases where it can be fairly said that an admission of liability, first had indicated an acceptance of wrongdoing and a suitable and credible expression of regret, and or secondly, had indicated a willingness to facilitate the course of justice: Mornington Inn 168 FCR at 405 [76]. I am satisfied by Mr Mott's evidence and the Authority's acceptance of the measures that Radio 2UE now has in place that those measures provide a better means of ensuring compliance by presenters with the disclosure standard. It is not necessary to give the detail of the measures here. Radio 2UE has learnt from its experience of Mr Laws' breaches. In addition, he has retired and Radio 2UE now has inserted into its contracts with presenters a right to suspend a presenter immediately if it reasonably believes that he or she may be in breach of the contract. On behalf of Radio 2UE, Mr Mott expressed deep regret for the occurrence of all 13 breaches. I accept that evidence. I am satisfied that Radio 2UE has genuinely accepted its wrongdoing in its contravening conduct and, through Mr Mott and its co-operation in the conduct of the earlier investigations and in these proceedings, it has made a genuine expression of its regret. Radio 2UE also indicated a willingness to facilitate the course of justice by this commendable conduct. These factors warrant some reduction in the penalty that would otherwise be appropriate. The fact that the 13 contraventions occurred given the history of Radio 2UE's previous failures to comply, because of its presenter's, Mr Laws', conduct and views, adds to the seriousness of these contraventions. Licensees must be on notice that such violations of the public trust will attract substantial penalties, even in the enforcement tier into which the civil penalty proceedings fall under the Act. One of the primary purposes of imposing a penalty is to penalise the wrongdoer for its contravention of the law. The amount of that penalty must be in a sum that is appropriate in all the circumstances. There will be occasions where one person contravenes the law in circumstances where one penalty might be appropriate, but if a different person commits the same breach the same circumstances might dictate that a substantively different penalty would be appropriate. This is commonplace in explaining why a first offender may receive a lesser penalty than a person who has a substantial record of offending. The element of deterrence may be but one of the considerations relevant under the applicable statutory scheme which a person imposing a penalty or sentence must take into account in arriving at a sanction which is appropriate in all the circumstances. The position of public trust and the damage which can be done to the integrity of broadcasting by breaches of the disclosure standard mean that these contraventions, generally, must be seen to be within a higher scale than that chosen by the parties. This is not a case of a licensee with no prior history of the kind which Radio 2UE had in relation to Mr Laws as the references to that history in the agreed facts accepted. Radio 2UE was in the position it was, after giving the enforceable undertaking, because of its earlier failures to implement a proper system for compliance on Mr Laws' program with the disclosure standard. And, cl 13 of the disclosure standard obliged Radio 2UE to require Mr Laws to comply with it. Radio 2UE has only itself to blame for its failure to do so. I am of opinion that, overall, the 13 contraventions could not properly be characterised, in the way the parties argued, as towards the lower end of the range. Some, however, were at the lower end. Mr Laws used Radio 2UE's licence to promote his sponsors for his significant financial benefit without complying with the disclosure standard. That standard clearly irritated him. Radio 2UE was aware of his dissatisfaction with having to obey the law in earning his considerable income from his commercial agreements. It had given an enforceable undertaking that put in place a new compliance system. That system, through the independent reviewer, actually identified the first contraventions on 5 October 2007. But, as I have found, Radio 2UE ignored its obligations under the enforceable undertaking and none of its officers bothered to read the independent reviewer's report. Mr Mott explained (and I accept) that, in his case, this was due to pressure of work and oversight. But there was no evidence from Mr Ruhfus why he did not read these or if he had what he did in response or why no-one else had that simple reading task delegated to them. The contraventions were obvious as soon as the short, lucid report was opened. Mr Laws' contraventions, and hence Radio 2UE's, continued thereafter. A commercial radio broadcasting licensee must appreciate that it is responsible for its presenter's breaches of the Act and its licence. It must take real, and not perfunctory steps, as Radio 2UE did in October and November 2007, to ensure its compliance with the Act and licence. Unless this realisation is promoted there is a real risk of further contraventions of the disclosure standard by Radio 2UE and other licensees. A pecuniary penalty of $10,000 for each of the 13 contraventions for these serious breaches by the presenter who was a stimulus, first, for the introduction of the disclosure standard and, then, the 2006 amendments is manifestly inadequate. I am of opinion that, in general, the individual penalties of $10,000 are, and the total for the 13 contraventions of $130,000, is as a whole unreasonable and plainly unjust. Thirteen accidental slips over a two month period by a presenter with an unblemished record, depending on the circumstances, may attract pecuniary penalties at the lower end of the scale. But Radio 2UE cannot be seen to get such benign, indeed ineffectual, treatment for Mr Laws acting as Radio 2UE when breaching the disclosure standard in the present circumstances. Radio 2UE cannot be allowed to rely on its inability to ensure that its presenter, Mr Laws, with his history, scrupulously adhered to the conditions of its licence and obeyed the law. Overall, the contraventions in this case are of a serious nature. They indicate that there was a significant failure of Radio 2UE to take proper and sufficient steps to ensure that Mr Laws, in fact, complied and continued to comply with the disclosure standard. Not only did the Act and its licence require it to ensure that Mr Laws complied with the disclosure standard; as a result of Mr Laws' last serious contraventions it had just given an enforceable undertaking that it would bring this about directly. The obligations imposed on Radio 2UE as conditions of its public broadcasting licence were to protect the public. Mr Laws earned substantial amounts of money for himself through his commercial agreements using its licence. That made it all the more incumbent on Radio 2UE to ensure that Mr Laws did not contravene the conditions of the licence again. While I accept that both the Authority and Radio 2UE have approached the matter with good faith and in an attempt to serve what they perceive to be the public interest, I am of opinion that they have not adequately focused on the significant violations of the public trust placed in Radio 2UE which it breached through allowing Mr Laws' misbehaviour. The 13 instances were not isolated contraventions. They followed from a history. The Parliament enacted the 2006 amendments, containing the civil penalties and enforceable undertaking provisions, in order to be able to provide a mechanism to deter and stop conduct of the kind in which Mr Laws had previously engaged in misusing his and Radio 2UE's privileged position under its licence. The first two contraventions should fall into the range which the Authority and 2UE have selected. There is no evidence that Radio 2UE or Mr Laws had contravened the disclosure standard between August 2006 and 5 October 2007. The second contravention was more serious because of the earlier realisation, after the first, of the need to make a disclosure announcement, but overall the agreed penalties are within a range that make them appropriate. Had the independent reviewer's report for that period been read properly and promptly, it would have revealed to Mr Mott or Mr Rufhus, or others at Radio 2UE at that time, that Mr Laws had failed to comply with the disclosure standard twice on 5 October 2007. In addition, the internal monitor should have drawn attention to these contraventions. The Authority and, I infer, Mr Mott and Mr Ruhfus received the independent reviewer's report on 18 October 2007, the date of the third and fourth contraventions. But there is no evidence of when on 18 October that report was received. It is not possible to find whether its receipt by Mr Mott and Mr Ruhfus on that day would have enabled Radio 2UE to take steps to prevent the third and fourth contraventions. Each was a clear, easily recognisable contravention. I am of opinion that each was serious. The remaining 9 contraventions should have been prevented had Radio 2UE appreciated from the 18 October independent reviewer's report that the new compliance system had not worked and it had once again breached the Act and the disclosure standard, as well as the enforceable undertaking. Given the stage which the acquisition had reached, the threat of Radio 2UE being found to be in breach of its licence and the enforceable undertaking also would have impelled immediate action by Mr Mott, if not his superiors in Southern Cross Broadcasting to ensure that Mr Laws complied with the disclosure standard in the future. Contraventions 5, 6 and 7 all occurred on 24 October 2007. Contraventions 5 and 6 involved two different sponsors, Toyota and Byron Bay Beveridges that were referred to in one talk back conversation between Mr Laws and a listener. There was no extenuating circumstance for either contravention. Mr Laws appeared to have considered that he could devise his own rules for compliance with the disclosure standard by ringing a cow bell at the mention of a sponsor's name. However, that could not satisfy the requirement of cl 7(3) to make a disclosure announcement using one of the six prescribed verbal formulas. The contraventions were clear, serious and inexcusable. These contraventions were at a higher level than the lower end of the range, even after allowing for all the mitigating factors relied on by the parties. In addition, contravention 7 involved three mentions of Hamilton Island in the one conversation with another talk back caller without any disclosure announcement. Again, I am unable to see any extenuating circumstance that suggests that this was not a serious contravention. Its seriousness was compounded two days later in contravention 8 when this segment was replayed, without any disclosure announcement, as a highlight of Mr Laws' programs during the preceding week. In my opinion contravention 8 was a very serious contravention because Radio 2UE used a recording. Thus, it was not a case of a spontaneous on-air error. Anyone connected to Mr Laws' program who selected this segment for repetition, must have known that Hamilton Island was a sponsor and there was no disclosure announcement for any of its 3 mentions. Thus, the republication of contravention 7 in contravention 8 was reckless conduct by Radio 2UE. Contravention 9 involved another use by Mr Laws or Radio 2UE of the cow bell as a substitute for compliance with cl 7(3) of the disclosure standard. By this time, Mr Laws had committed 8 previous contraventions. The use of the cow bell did not satisfy in any way the obligation to make a disclosure announcement. There were no extenuating circumstances to reduce this serious breach to the lower end of the range. Contraventions 10, 12 and 13 all occurred on Mr Laws' last day as a presenter. Contravention 10 was not as clear cut as the others, however, Radio 2UE accepted that it had been made out by Mr Laws mentioning the names of the two majority shareholders in his sponsor, Roche Group Pty Limited. This connection was between Mr and Mrs Roche and their companies' products or services was not as blatant or obvious as the other contraventions involving the use of well known brand names. I consider that this contravention is one that can reasonably be seen as falling within the range of the agreed penalty, notwithstanding that it was the tenth breach of the disclosure standard. Contraventions 11 and 12, however, were both egregious. Callers mentioned various sponsors. Mr Laws and Radio 2UE made no attempt to comply with the requirement to make appropriate disclosure announcements. These failures had no extenuating circumstances and, in my opinion, were each a serious contravention. Indeed, contravention 12 involved the mention of 5 of Mr Laws' sponsors. Contravention 13 was a very serious, deliberate contravention. It expressly flouted the disclosure standard. I am comfortably satisfied that there was no justification or excusable circumstance for contravention 13. Nor do I regard the agreement to a penalty for it to constitute a significant mitigating circumstance. It was the fourth contravention on that day. It was blatant and a direct challenge to the Authority, the Act and the disclosure standard. The imposition of a penalty of $10,000 for contravention 13 would be seen by the community, with every justification, as a minor slap on the wrist for a deliberate flouting of the law. If a presenter can deliberately behave as Mr Laws did in contravention 13 and the commercial radio licensee receive a penalty at the lower end of the range, no-one will be deterred from committing substantial infractions of the law. That behaviour calls for a very substantial, if not the maximum, penalty. But, before finalising the civil penalty orders the Court must look at and, if need be, adjust the resulting total effect of the individual orders it is considering, so as to produce an overall set of civil penalty orders appropriate to deal with all the contraventions. In other words, the totality principle applicable in passing criminal sentences should be adapted to apply to the overall civil penalty orders imposed on a contravenor: Mill v The Queen [1988] HCA 70 ; (1988) 166 CLR 59 at 62-63 per Wilson, Deane, Dawson, Toohey and Gaudron JJ, applied in a civil penalty context by Stone and Buchanan JJ in Mornington Inn (2008) 168 FCR at 408 [91]; see too at 397-398 [42]-[45]; see also per Gyles J who dissented in the result but not on the principle's applicability at 386-387 [5]-[9]. Where contraventions are separate offences in law but are substantially contemporaneous and connected, the Court must have regard to the totality principle in fixing the individual penalties: L Vogel & Sons Pty Ltd v Anderson (1968) 120 CLR 158 at 168 per Taylor, Menzies and Owen JJ. The Court must also have regard to the relative closeness of the relationship in time and character of the offences (or contraventions): Mill 166 CLR at 64. Some aspects of the totality principle are not as easily applied to pecuniary penalties as to sentences of imprisonment using the method preferred in Mill 166 CLR at 63. The High Court suggested its preference for making sentences wholly or partially concurrent, where practicable, to reflect the appropriate overall punishment in the ultimate total result rather than lowering individual sentences below what would otherwise be appropriate to reflect the fact that a number of sentences were being imposed: Mill 166 CLR at 63; RH McL v The Queen [2000] HCA 46 ; (2000) 203 CLR 452 at 457 [15] - [16] , 462-464 [32]-[34] per Gleeson CJ, Gaudron and Callinan JJ, 476 [75] per McHugh, Gummow and Hayne JJ; see too Lukatela 223 FLR at 15-16 [75]-[77] where I discussed the principle. Concurrent pecuniary penalties cannot be imposed. So the Court must consider the overall burden imposed by the set of pecuniary penalties to assess whether, in totality, the burden is greater that is warranted by the contraventions in all of the circumstances: see too s 205F(3). In fixing the penalties below I have had regard to the totality principle as explained above. In addition, Radio 2UE has entered into a deed of cross guarantee with its ultimate holding company, Fairfax Media Limited, and thus has adequate resources with which to pay any penalty in the whole range and costs. I have also had regard to the significant advertising revenues of Radio 2UE, disclosed in Mr Mott's confidential evidence, in forming the view that Mr Laws must have been valuable to Radio 2UE. Mr Laws was obviously a presenter on whom Radio 2UE relied on to attract to attract audiences and advertising review. He had over 50 years exposure and experience of public broadcasting. I find that Mr Laws attracted a significant proportion of its total advertising revenue earnings, having regard to what he himself earned and Mr Mott's evidence that he was the station's presenter with the most commercial agreements. The Authority's report in respect of the 13 contraventions identified Byron Bay Beer and Toyota Motor Corporation Australia Limited as advertisers on Radio 2UE as well as sponsors of Mr Laws. There was no evidence that the other sponsors, the subject of the contraventions also advertised on Radio 2UE. The imposition of a civil penalty is, like the imposition of a sentence, a matter of instinctive synthesis. Here, there are no guides other than the subject matter, scope and purpose of the Act and the disclosure standard to use in ascertaining the object of imposing pecuniary penalties under s 205F. The public interest in ensuring that a commercial radio broadcasting licensee adheres to the conditions of their licence is of great importance. The repeated and substantial breaches by Radio 2UE as a licensee, should not be treated with a benign punishment. I am of opinion that having regard to the cumulatively damaging features of the repeated contraventions, civil penalties for most of them in a higher range than that chosen by the parties are the only ones which would appropriately meet the justice of the case. Radio 2UE took no action at all on Mr Laws' last day. The failure to institute a proper system earlier led to the continuing and serious breaches by Radio 2UE of the conditions of its licence. But, Mr Laws' conduct itself was the central element of the contraventions. Any system is only as good as its weakest part. Mr Laws was a known recidivist. The independent reviewer detected his initial two breaches and reported them in time to enable preventative steps to be taken before 24 October 2007. Even then, Radio 2UE was aware of contraventions 7 and 8 by 26 October 2007 and reported them to the Authority. Yet there was no evidence of what steps it took then, after becoming aware that its internal monitor had failed to prevent, first, the initial contravention, let alone its republication, as had its training of Mr Laws and his production staff. And, Radio 2UE was aware, at least constructively, from the independent reviewer's report of contraventions 5 and 6 involving Mr Laws' "rant" and the inappropriate, seething resentment in his 29 October "disclosure" that, he treated the disclosure standard with contempt. The pecuniary penalties must put a price on the contraventions that is sufficiently high to deter repetition by Radio 2UE as the contravenor and by others who might be tempted to contravene the Act and the disclosure standard: see CSR (1991) ATPR p41-076 at 52,152 per French J. I am of opinion that there will be a substantial deterrent effect given to licensees by the penalties I will impose. The kind of contraventions that Mr Laws caused Radio 2UE to make and its inadequate attention to the requirements of compliance must be deterred if the purpose of the disclosure standard is to be upheld. I am satisfied that there will not be a repetition of Mr Laws' conduct only because he has retired from presenting his program on Radio 2UE. Radio 2UE has not had to deal with or test whether Mr Laws would now comply under its new measures. However, I am also satisfied that Radio 2UE has implemented genuine and satisfactory changes to its compliance systems that are likely to lead to compliance by its other presenters. And, I am also satisfied that no bad faith was involved on the part of Radio 2UE's management or Mr Mott. Licensees must be deterred from taking lackadaisical attitudes to compliance with their statutory and licence obligations. Takeovers and changes of control in ownership occur on a fairly regular basis in the broadcasting industry. Such events are not an excuse for a licensee to fail to comply with the Act, the disclosure standard or its licence. If Mr Mott and all the senior management were too busy to protect the very basis which generated Radio 2UE's entitlement to earn income, namely its licence, then a clear message must be sent by condign penalisation of that attitude. Such an attitude is unacceptable. It demonstrates an inattention to the public trust in commercial radio broadcasting licensees. The privilege of being able to use the public radio spectrum cannot be allowed to be abused in the way that occurred here. The history and circumstances of the contraventions call for the Court to make clear how important licensees must regard the privilege which their licence gives them and the heavy responsibilities imposed by their licences if they are to continue to benefit by exploiting a public right. Under s 205F(3), I have had regard to all relevant matters, including, but not limited to the nature and extent of the contraventions, the mitigating factors put before me and particularly the circumstances in which they took place. Because this is the first time in which a civil penalty has been considered in the context of the Act, I have given anxious consideration as to whether I should, despite my views, accept the submissions of the parties as to the appropriate range. For the reasons I have given, the considerations for imposing a civil penalty under the Act include but are not limited to those in the contexts of other legislation. The purposes for imposing civil penalties under legislation such as the Trade Practices Act are different. They involve contraventions of laws of general application by persons engaged in trade or commerce. Here, under the Act, the contraventions attracting liability to the imposition of a civil penalty involve the breach by a licensee of conditions of a licence granted by law to engage in activity for profit. The licensee is in a position of public trust. I have taken into account the mitigating factors that Radio 2UE and the Authority have referred to in their submissions and evidence. I accept that Radio 2UE, since the contraventions came to light, has co-operated with the Authority and genuinely regrets its conduct. However, the penalty must punish the significant breaches of public trust that occurred. In addition, Radio 2UE did not ensure that the new system was working after it gave the enforceable undertaking. No explanation has been given why Mr Ruhfus did not learn of the contraventions (other than contraventions 7 and 8) or of what he did to satisfy himself, as general manager of Radio 2UE, that it was, through Mr Laws, complying with the Act, the disclosure standard and the enforceable undertaking. I have not punished Radio 2UE for breach of the enforceable undertaking. But its existence, the circumstances in which it was given and its proximity in time to the contraventions should have ensured that someone in Radio 2UE checked whether the new compliance system actually worked. It is an aggravating factor that no adequate steps were taken by Radio 2UE, even in that context, to check or ensure that the new system was working. A licensee cannot assume that nothing will go wrong. Far less could Radio 2UE have assumed this with Mr Laws who, after all, had been the cause of giving the enforceable undertaking. Radio 2UE had a duty to be vigilant to ensure compliance with its licence, the disclosure standard and the Act. Instead, Radio 2UE committed the contraventions when it permitted Mr Laws to use its licence knowing that, first, Mr Laws had a history of previous contraventions of the disclosure standard (cp Weininger 212 CLR at 640 [32] per Gleeson CJ, McHugh, Gummow and Hayne JJ), secondly, he had an antipathy to the disclosure standard, thirdly, he had six very substantial commercial agreements and, fourthly, he made frequent references during his program to his sponsors, their products and services. But for Radio 2UE's mitigating conduct, I would have imposed higher penalties for these serious breaches. Rather than making declarations, I consider that it is appropriate to state each contravention and the pecuniary penalty I have imposed for it in the formal orders. The Authority, licensees and the public will be able to relate the two together in that way. In my opinion, these contraventions should be marked with severe and substantial pecuniary penalties. The agreed penalties are, overall, but with the three exceptions I have noted, manifestly inadequate, indeed, negligible. To be sure, the Parliament intended that ss 140A and 205F would be a means of dealing with contraventions not calling for more severe sanctions such as suspension of a licence or its cancellation. The Chairman of the Authority aptly described the obligation to comply with the disclosure standard as going to the heart of a licensee's obligations. No disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island. I mean I'm here for a little while yet...have you been to Hamilton Island?.. Do you want to go to Hamilton Island? Directly after the commercial at 11:28, approximately 90 seconds after the mention, Mr Laws says: 'I did tell you that Hamilton Island are sponsors of mine, didn't I? Contravention 2: Friday 5 October 2007, approx 11:40am. No disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island. You know, it's what brightens your day up...you know, we're going to miss that when you go, really miss that. No disclosure announcements for this sponsor were made for the rest of the program. Contravention 3: Thursday 18 October 2007, approx 10:06am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of Mr Laws at the time of an on-air mention of Byron Bay Beer. Do they sell it in my state? Contravention 4: Thursday 18 October 2007, approx 10.28am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of Mr Laws at the time of an on-air mention of Byron Bay Beer. Shortly after this statement Mr Laws said: 'We'll see what we can do. But enjoy Hamilton Island. As you know they are sponsors of mine...' and very soon after concluded the call. Although Mr Laws made a disclosure announcement for Hamilton Island, there was no disclosure announcement for the Byron Bay Beverages Pty Ltd sponsorship during the conversation with Mark. Prior to the conversation with Mark, Mr Laws had broadcast a live-read commercial for Byron Bay Premium Ale at 9:59am. The 10:28am conversation with Mark was followed by station advertisements, a 15-minute interview with singer James Blunt and station advertisements that finished at 10:50am. There was no disclosure announcement during this period for Byron Bay Beer. Contravention 5: Wednesday 24 October 2007, approx 11:13am. No disclosure announcement was made that Toyota Motor Corporation Australian Ltd was a sponsor of Mr Laws at the time of an on-air mention of the Toyota Landcruiser. During that call, Greg invited Mr Laws to his town in western New South Wales. Greg said. '...we'd like nothing better to, and I'm going to have to ask you to ring your RM Williams bell, to load up the Landcuriser with our esky and our snags...' Mr Laws replied: 'Good on you. Let me ring the bell'. A cow bell was sounded. Mr Laws rang the cow bell after the mention of 'Landcruiser'. No disclosure announcement was broadcast for Toyota at that time or at any other time during the rest of the call. At 11.19am, Mr Laws conducted a 90 second live-read commercial for Toyota cars and the Warren Toyota Dealership. Prior to contravention 5, Mr Laws had made an earlier disclosure announcement. He spoke to a caller, 'Heath', at 10.43am (about half-an-hour before the conversation with Greg). Heath mentioned his 'new Hi-Lux'. Mr Laws then rang the cow bell and said: 'They're sponsors of mine, Toyota, as you know. ' Mr Laws did the same thing about 45 seconds later when he said: '....we got a Toyota watch there we'll send Heath. Good lad, kept his belt buckle and kept on buying Toyotas [cow bell sounds] and you're right, they're sponsors of mine'. Contravention 6: Wednesday 24 October 2007, approx 11.14am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of Mr Laws at the time of an on-air mention of Byron Bay Beer. During the call, Greg invited Mr Laws to his town in western New South Wales. Greg said: 'And, as I said, if you'd like to bring some of your Wild Turkey or your Byron Bay beer and, or what have you'. Mr Laws replies 'Got to ring the bell again' and the sound of a cow bell is heard. I'm sure I did. I say it in my sleep. Anyway, they're sponsors Greg. I'll send you a case. Get Greg's address. I did say Qantas are sponsors of mine because I say it in my sleep'. Contravention 7: Wednesday 24 October 2007, approx 10.10am. No disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island. Norman said: 'You go to Hamilton Island, you come back, then you go on holidays...' Mr Laws replied: 'That's what really, really [expletive deleted] you off, that I go to Hamilton Island....Do you want to go to Hamilton Island, Norman?.. ' Although Norman appeared to be an abusive caller, Mr Laws and Norman conversed for some time. No disclosure announcement relating to Hamilton Island Enterprises was broadcast. Norman mentioned Hamilton Island again, but no disclosure announcement was made then or at the end of the call with Norman. No disclosure announcement was broadcast for Hamilton Island for the rest of that hour of the program. On 26 October 2007 at 5:27pm Mr Ruhfus faxed a letter to the Authority reporting contraventions 7 and 8. Contravention 8: Friday 26 October 2007, approx 11.51am. No disclosure announcement was made that Hamilton Island Enterprises was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island. Radio 2UE did not cause a disclosure announcement to be broadcast following the replay. Contravention 9: Friday 2 November 2007, approx 11.21am. No disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of Mr Laws at the time of an on-air mention of Toyota. Les identified himself as a long-time listener and said: I'm also a Toyota owner as well. ' Mr Laws replied: 'Oh hang on [cow bell is sounded], I'll ring the bell...Find something for Les, he's a Toyota man, and a good one. And as I've said [implying a disclosure announcement] but...so I won't say it again will I? Mr Laws replied: 'Isn't it a great vehicle? I rang the bell because Toyota are sponsors of mine, I say with pride'. A few seconds later, Mr Laws finished the call with Susan and, after arranging that she be sent a Toyota ladies watch, said: '....and I suppose after all that I better [cow bell sounds] tell you that they're sponsors of mine. ' Those disclosure announcements did not relate to back to the conversation with Les concerning Toyota. Contravention 10: Friday 30 November 2007, approx 9.53am. No disclosure announcement was made that the Roche family was a sponsor of Mr Laws at the time of an on-air mention that was directly favourable to the sponsor. ' Mr Laws then said: 'That's Bill and Imelda --- that's the Roche family who are wonderfully kind, kind people....' No disclosure announcement was made for the Roche sponsorship. The Authority found that, as direct beneficiaries of the promotional services provided by Mr Laws under a commercial agreement with the Roche Group Pty Ltd (the Roche family are majority owners of the company), the Roche family was 'sponsors' within the meaning of cl 6 of the disclosure standard. Contravention 11: Friday 30 November 2007, approx 10.21am. No disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of Mr Laws at the time of an on-air mention of Toyota Hi-Lux. Rebecca said: '...I'm actually driving a Toyota Hi-Lux at the moment and just riding talking to all the farmers. Every single one of them has you playing on the radio at the moment. ' Mr Laws said: 'Isn't that nice? That's very nice. How old are you, Rebecca? Mr Laws went onto another caller. Contravention 12: Friday 30 November 2007, approx 11.14am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd, Toyota Motor Corporation Australia Ltd, Qantas Airways Ltd and Oatley Family Wines were sponsors of Mr Laws at the time of an on-air mention of Byron Bay lager, Toyota, Qantas and Wild Oats Wine. Any time you want a forecast to go to lunch, you've got one. Any time you might want to know it is right to be flying OS or are we going to take Caroline up the Hunter? Or put her on the boat? You ring me, you get a personalised forecast for free, Lawsy. Did I say for free? Well I mean we can work something out with some Wild Turkey, Byron Bay larger, maybe a Toyota, some Wild Oats, a Qantas flight, but I am your personal forecaster for free mate. You're a good fella. I'll see you soon. ' Mr Laws did not make a disclosure announcement for any of the 5 sponsors mentioned by Mr Bailey. Contravention 13: Friday 30 November 2007, approx 11.25am. No disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of Mr Laws at the time of an on-air mention of Toyota. Mr Laws said, 'And of course I've got to say Byron Bay Beer are sponsors of mine'. When are you people going to get over it? Never? What are you going to do next week when you don't have to sit around and listen to me all day in case I say Toyota? [pause] Oh did you hear that? Did you hear that, Alice? He said Toyota! God! Boring old bastards! 13 13 32 is our telephone number. [pause] No, not our people here, the people at the....whatever you call it, what do you call it? ACMA. As I said yesterday, it sounds like a skin ailment. | contravention enforcement and remedies civil penalty provision pecuniary penalty determination of broadcasting services act 1992 (cth) ss 140a , 205f factors to be considered principles to be applied by court when parties agree on penalty circumstances in which court will depart from agreed penalty intervenor opposes agreed penalty regulator's views not determinative of the penalty court need not begin analysis with agreed penalty range importance of the regulator explaining its approach for discounting the penalty court may reject agreed penalty if it is plainly unreasonable or unjust or manifestly inadequate or excessive totality principle applies to pecuniary penalties purposes depending on statutory scheme can include, in addition to deterrence, punishment and retribution broadcasting services licence nature of licence rights to operate a broadcasting licence is a privilege granted under the broadcasting services act 1992 (cth) ss 3(1) and 4 (1) licensee holds a position of public trust public interest considerations in the statutory scheme ability for broadcasting to exert influence in shaping community views holding licence means assuming a position of public trust disclosure standard a method of ensuring transparency in current affairs broadcasting services act 1992 (cth) ss 140a , 205f breaches of broadcasting services (commercial radio current affairs disclosure) standard 2000 famous radio personality commits contraventions proceedings for agreed penalty liability under s 140a of licence in respect of conduct by contravening "star" is direct, not vicarious, liability of the licensee australian communications media authority pecuniary penalties broadcasting services act 1992 (cth) penalty range s 205f(3) court must have regard to "all relevant matters" in fixing a penalty general and particular deterrence public interest considerations punishment or retribution for violating the public trust in fixing a penalty under the act nature and extent of contraventions circumstances of the contraventions relevance of alternative methods of enforcement for similar/same contraventions criminal proceedings may be commenced after civil penalty imposed whether choice to bring civil penalty proceedings, rather than criminal prosecution, indicated a lighter penalty no answer that internal compliance review processes miscarried history of contravening relevance of respondent's early admission of liability whether co-operation with prosecuting authority ameliorates penalty contraventions were reckless and demonstrated a contempt for the standard offence towards the higher end of range pecuniary penalties pecuniary penalties communications law communications law communications law |
The Respondent do on or before 9 November 2006 provide further and better particulars of its Amended Defence in accordance with the following paragraphs of the Applicant's Request for Further and Better Particulars dated 5 December 2005 namely paragraphs 22, 23.4, 24.4, 25.2, 36, 40 and 44. 2. The Applicant pay the Respondent's costs of the submissions as to particulars. Burgess Rawson (WA) Pty Ltd (Burgess Rawson) is a property valuer. 2 On 10 July 2000 a company called Hi-8 Asset Management Pty Ltd (Hi-8) entered into a contract of sale for the purchase of property at 78 Wittenoom Street, East Perth. There was a partially completed building on the land. PNC alleges, in its statement of claim in these proceedings, that Hi-8 requested Burgess Rawson on 2 February 2001 to provide a valuation of the property and that a valuation was prepared in February 2001. Burgess Rawson is said to have certified that the fair market value of the property upon completion of the building would be $5 million subject to various qualifications. It assessed the fair market value of the property with the partially completed building at $4,700,000. Hi-8 then provided the valuation report to PNC for the purpose of obtaining finance to proceed with the purchase of the property. 3 PNC says that, relying upon the valuation report, it offered a loan of $3,500,000 jointly to Hi-8 and another company, AP Investments Pty Ltd (AP), to assist with the purchase of the property and the completion of the building. The offer of the loan was subject to conditions. It alleges that it made the offer in reliance upon the valuation. The offer was followed by a loan contract entered into on 19 March 2001 under which the sum of $3,500,000 was advanced. The loan was secured by a mortgage executed over the property on the same date. 4 PNC alleges that about 21 March 2001 Burgess Rawson altered the valuation report in accordance with minor variations required by PNC, including an alteration to show that the report was prepared for PNC for mortgage security purposes. It thereby agreed that the valuation report should be relied upon by PNC. The PNC mortgage was duly registered over the land. 5 PNC says that since April 2001 Hi-8 and AP defaulted in repaying amounts due under the loan contract and the mortgage and that on 23 April 2002 PNC took possession of the property. The net amount it received upon sale of the property was $2,494,000. 6 According to PNC, the valuation report contained false assumptions. One was that upon completion of the building its ground and third levels would be leased to companies associated with Hi-8. The other was that the cost of completion of the building would be $300,000. It alleges that Burgess Rawson effectively represented to it that it was reasonable to make the assumptions in the circumstances known to it and that a competent valuer would make those assumptions. It is then said that the assumptions were not reasonable for reasons known to Burgess Rawson. The proposed leases were to companies associated with Hi-8 and were for amounts above the fair market net rental. The valuers were not provided with any legally binding lease documents or any documents evidencing the proposed leases. And it should have been apparent to a competent valuer upon inspection and review of the plans of the building that further work which would cost substantially more than $300,000 was required in order to complete it. 7 PNC also alleges that the certified valuation of the fair market value of the property did not make any allowance for a purchaser applying a discount to the price the purchaser would be willing to pay because of the risk involved in purchasing a partially completed building which would require substantial further work in order to complete it. 8 On the basis of these factual pleadings, PNC claims that Burgess Rawson engaged in misleading or deceptive conduct in contravention of s 52 of the Trade Practices Act 1974 (Cth) (the Act) and that it breached its duty of care to PNC in the provision of the valuation. 9 In its amended defence to the statement of claim Burgess Rawson admits the preparation of the valuation report and that the report was prepared to assess the fair market value of the property for mortgage security purposes. It also admits that it certified that the fair market value upon completion of the building on the property would be $5 million subject to various qualifications and that the fair market value with the partially completed building was $4,700,000. However it claims that the qualifications on the valuation were different from those pleaded by PNC. 10 Burgess Rawson admits that PNC was provided with the valuation report by Hi-8 and AP so that they could finance the purchase of the property. It admits that PNC offered the loan to the borrowers and that its stated purpose was to assist with the purchase of the property. It also admits the loan contract of 19 March 2001 but says that PNC did not rely upon its valuation in making the offer of finance or entering into the loan contract. This assertion is made on the particularised basis that PNC conditioned its offer of finance on a requirement that its own appointed valuer would provide a valuation after receiving details of the leases and that the loan to value ratio would not exceed 70%. Moreover the loan contract was executed on 19 March 2001 before the alteration of the valuation report alleged in the statement of claim. Burgess Rawson admits, as alleged, that it altered the valuation report and included an alteration to show that it was prepared for PNC for mortgage security purposes. It does not, however, admit that it agreed the report should be relied upon by PNC. 11 Burgess Rawson says that by the time liability for the valuation was extended to PNC, PNC had already agreed to provide a loan on the security of the property. Burgess Rawson denies representing that it was reasonable to make the assumptions pleaded and that a competent valuer would make them. The assumptions were part of the instructions given to it for its initial valuation. The assumptions are referred to in the amended defence as 'Instruction Parameters'. It was said to be clear from the valuation reports that no opinion was being expressed about the accuracy of the "Instruction Parameters". Burgess Rawson alleges that a reasonable lender would not have understood it to be representing that the "Instruction Parameters" were correct or reasonable or would be made by a competent valuer. It denies the claims of misleading or deceptive conduct and breach of a standard of care. 12 Burgess Rawson pleads contributory negligence on the basis that PNC failed to put itself in a position to confirm that the stated assumptions in the valuation report were correct or to obtain additional mortgage security to avoid reliance upon a valuation report. It says that PNC failed to verify the cost of completing the building. It failed to give due consideration to the risks to a lender associated with a building being incomplete and failed to verify the degree of completion of the works and the extent of the works still required. Other alleged failures of a due diligence character are also pleaded against PNC. 13 Burgess Rawson also asserts that PNC failed to mitigate its loss. It is not admitted that PNC suffered any loss or damage by reason of Burgess Rawson's conduct. 14 On 5 December 2005 PNC requested further and better particulars of the amended defence. Such particulars were filed on 14 February 2006. Burgess Rawson objected to answering certain of the requests. The parties agreed that the question of the objections could be dealt with on the papers. Burgess Rawson has prepared a schedule of its objections. PNC's responses to those objections are contained in the schedule. I propose briefly to rule on each objection. Facts relevant to facts in issue emerge from the particulars and the evidence. The function of particulars is not to expand the issues defined by the pleadings, but "to fill in the picture of the plaintiff's cause of action with information sufficiently detailed to put the defendant on his guard as to the case he has to meet and to enable him to prepare for trial. " [Bruce v Odhams Press Ltd [1936] 1 KB 697 at 712-13 ]. The underlying principle is that the case of each of the parties is adequately exposed to the other. It is important to maintain a sense of balance in the detail of particulars sought and ordered. The provision of particulars should not be allowed unduly to increase the cost and delay associated with litigation. In contemporary commercial litigation where, frequently, the court will direct the filing of witness statements or affidavits on either side subject to the right to cross examination, the necessity for elaborate particulars and lengthy debates about them is even more questionable. 18 Against that background I have no hesitation in rejecting a request for particulars which begins with the words " ... specify every fact, matter, reason, inference and thing relied upon ...". The immediate and apparent vice of such an ill-disciplined request is that it will seek to rope in the other party's evidence. On this basis I will not order the provision of the particulars requested in pars 9.5, 16, 31, 33.3, 35.3, 37, 39, 41 and 45 of the applicant's request. 19 As a particular of contributory negligence Burgess Rawson claims that PNC failed "to obtain additional mortgage security to avoid reliance upon the valuation reports". PNC asks, in par 11 of its requests, what additional mortgage security it should have obtained. However the issue is clear on the pleading and no particular amount is implied in the statement of defence. The particulars are not necessary and the request is rejected. 20 Paragraph 28.4 of the amended defence alleges that PNC failed to satisfy itself that Hi-8 and AP would have the funds to finance the fit out for tenants referred to in the valuation report which would be required before the building could generate rental income. Paragraph 13 of PNC's request seeks particulars of the amount of funds it is alleged that Hi-8 and AP required to finance the fit out for tenants referred to in the valuation report. The pleading does not imply specification of a particular amount. The request is refused. 21 Paragraph 29 of the amended defence alleges that PNC failed to mitigate its loss. This presumably relates only to the tortious cause of action. Mitigation does not inform the recovery of damages under s 82. There are extensive particulars of failure to mitigate set out in par 29. The request would require Burgess Rawson to further particularise, for each particular in par 29, the quantum of the loss or damage which it says is attributable to PNC's alleged failure to mitigate its loss and provide particulars of the calculation of that quantum. I do not accept that it is necessary to quantify each of the items of alleged failure to mitigate. This request is refused. 22 Paragraph 21 of the request would require the provision, for each particular in par 29, of the difference between the loss and damage claimed by PNC and the damage it is alleged PNC would have suffered if it had mitigated its loss as alleged. This request suffers from the same vice, lack of necessity, as the particulars sought in par 20 of the request and is refused. 23 The requests for particulars in pars 22, 23.4, 24.4 and 25.2 of the request are conceded by Burgess Rawson. 24 Paragraph 29.3 of the particulars of failure to mitigate alleges that PNC failed to take reasonable and proper steps to complete the building and/or offer the property for sale upon taking possession of the property. PNC requests particulars of the sale price that Burgess Rawson says it would have obtained for the sale of the property if it had taken the alleged steps. Burgess Rawson says this is a matter to be covered in the exchange of expert evidence on the issue of failure to mitigate. I do not think it is a matter of particulars and I reject the request. 25 Paragraph 29.6(a) of the particulars of failure to mitigate alleges that PNC failed to take reasonable steps to market the property for sale to the public including undertaking adequate due diligence inquiries through appropriate professionals such as architects, planners and valuers to ensure that all the options that may potentially be available for the property were known and investigated. Paragraph 26 of the request for particulars of the amended defence wanted identification of the "options" that were potentially available for the property and that would have been known or investigated if PNC had made the alleged inquiries. Again this is a matter of evidence. I reject the request. 26 In par 31.2 of the amended defence, a particular is provided of the pleaded contention in par 31 that PNC's loss and damage was caused by the tortious misstatement or misleading or deceptive conduct or both of Hi-8. It particularises this allegation, inter alia, by alleging a representation to PNC that it could repay the loan when it knew, or ought to have known, that it was not likely to be able to do so. Particulars of the nature of, and parties to, the alleged representation are sought. In my opinion this request for particulars is appropriate and should be allowed. 27 Similar particulars are sought in request 40 of the particulars in par 33.1 of the amended defence and request 44 of the particulars in par 35 of the amended defence. In my opinion those particulars should also be provided. | pleadings particulars function of particulars test of necessity practice and procedure |
For the purposes of the Judgement, the first, second and third respondents will be referred to as the Amcor Parties, and the fourth, fifth and sixth respondents as the Visy respondents. The principal question raised on this application is the level of discovery which should be made in this matter. Jarra Creek in its Amended Notion of Motion (filed on 10 December 2008) first seeks general discovery of all documents related to the effect of the Visy respondents' conduct on the prices of Cardboard Fibre Products (CFP) supplied by them in Australia, and the alleged loss and damage suffered by Jarra Creek and group members for a period between 1 January 1998 to 1 May 2006 to the extent that such documents have not already been discovered by the Visy respondents. Secondly, and in the alternative, a more specific order is sought seeking discovery and production of a Logistics Database referred to in an affidavit of Mr Zwier, filed on behalf of the Visy respondents in this matter, as well as discovery of other electronic records so far as they contain data of CFP sales, and production data, and also information relating to Pulp Paper Products (PPP), as to sales and production data at a low level of particularity, together with details of sales/price, costs of production and production data for the products at customer level. In addition, the order seeks any hard copy documents created between 1 January 1998 and December 2004 recording costs of production at the customer and product level. In substance, the dispute between the parties concerns the appropriate particularity and detail at which discovery should be made. I have made previous orders for discovery in this matter on 19 November 2007: see Jarra Creek Central Packing Shed v Amcor Limited (2007) FCA 1559 , which sets out the general background. The Visy respondents contend that nothing material has changed since those orders and that there is no need for further orders of discovery because the present application seeks documents that were sought but not ordered to be produced on the previous application. The Visy respondents also say that, although after the making of the previous orders the applicant amended its pleading, in respect of the essential allegation for discovery purposes, there has been no significant change. It is submitted for Jarra Creek that the court should note that since the earlier discovery order the Amcor respondents have agreed to provide documentation at a far greater level of specificity than in the original orders and further that there is additional material from Professor Rubinfeld (of 19 Nov ember 2008), an economic expert, retained on behalf of Jarra Creek, to the effect that in order to determine whether the alleged cartel arrangement can be properly the subject of an expert opinion, it is necessary to have discovery in relation to the sales/price, costs of production and production data at the production facility level. Also, in order to construct a proper economic model, and conduct a detailed analysis of conditions conducive to cartel formation and quantify the effect on market process, Professor Rubinfeld considers that is necessary to obtain sales/price, costs of production and production data at customer level and product level. Professor Rubinfeld has read and refers to an affidavit of Ms Rebecca Gilsenan (Ms Gilsenan), the solicitor acting for Jarra Creek, dated 9 December 2008, which sets out inconsistencies and gaps in the material produced on behalf of the Visy respondents and notes that some of this discovered material also refers to low level specific data known to exist from documents discovered and information given to her. This detailed affidavit was not the subject of challenge or cross examination as to the factual material stated in it. The evidence discloses that there has been substantial discovery to date. For example, Visy has discovered 15,572 documents. Of these, 4,730 are financial documents or reports and 2973 are classified as spreadsheets, tables and lists. In summary, Ms Gilsenan says that the financial data discovered by Visy is aggregated at the level of production facility which would allow Jarra Creek to calculate the difference between costs and sales prices on average for all, but not each, of the customers of a particular facility, but that the coverage is incomplete and it would be necessary to make assumptions. She states that she does not have sufficient data at customer and product levels to allow the Jarra Creek's representatives to ascertain the process by customer or product or by classes of customer or product. The material presently furnished is at a high level of generality and Ms Gilsenan says that while she has some low level data of a specific nature, it is restricted to particular customers or limited time periods, and there is not enough to determine net pricing even for those customers. The existence of some low level data reinforces the view that such data exists and this is confirmed by evidence from the Visy respondents. Mr Leon Zwier (Mr Zwier), solicitor for the Visy respondents, has filed evidence in this matter and in his Fourth Affidavit of 8 December 2008 he refers to the earlier discovery decision over a year ago. In relation to Visy data concerning CFP at the customer and product level, Mr Zwier says that the Visy respondents have in their possession a database known as the Logistics Database. This Logistics Database contains data relating to CFP supplied by Visy Board at an account and product level from before 1 January 1998 to December 2008. A single customer of Visy Board can have multiple accounts. Mr Zwier describes this Logistics Database and its capacity to produce reports in a number of different formats. In paragraphs 22-28 of his affidavit he spells out further details of the database and points to the extremely large volume of documents arising from the fact that at any given time between 1 January 1998 and 1 May 2005 Visy had between approximately 5,000 and 7,000 different customers from time to time. The Visy respondents had created a list of all product lines sold in each calendar year over a six year period which, if printed, would amount to over 22,400 pages relating to CFP sales price and production data at customer and product level. Mr Zwier also refers to CFP cost data at customer and product level. In addition, he refers to the volume of material in relation to the discovery of financial reports relating to PPP. He expresses the view of the Visy respondents that to the extent that financial information at the customer level is relevant to the issues in the proceeding, it is in substance only relevant to the calculation of alleged loss or damage of individual customers who are group members, and that the calculation of any loss or damage suffered by individual customers who are group members should await the determination of liability and other common issues in the proceeding. Mr Zwier says that if the Court proposes to order discovery in respect of the alleged loss or damage suffered by individual customers of Visy who are group members, it would be necessary to identify which of its customers are group members. That is to say, customers who purchased and paid more than $100,000 for CFP in Australia in the period between 1 May 2000 and 2005. The Visy respondents contend that the production of the material is not necessary at this stage of the proceedings and that the degree of detail extends to particulars of damages or loss in relation to individual customers and that it is not appropriate to provide this material. Mr Zwier submits that it is only appropriate that the Visy parties produce what might be described as higher or general management reports and financial documents. In this case the questions of liability and damages have not been split, and indeed it may be very difficult to draw any clear line between evidence necessary to support the liability claim and evidence necessary to establish the liability identity and quantity of damage or loss suffered. I am not persuaded that the production of documents at the higher generalised level will suffice, particularly having regard to the evidence of Mr Rubinfeld filed since the earlier discovery order. In my view, the production of such material is necessary to enable Jarra Creek to properly prepare its case, having regard to the data sought at the lower level of specific particularity. At this lower level it is worth noting that the Amcor parties have agreed to make these documents available. This fact, coupled with the evidence of Professor Rubinfeld and the unsatisfactory nature of the discovery to date, leads me to conclude that orders substantially in the form sought by Jarra Creek should be made. Professor Rubinfeld in his latest report of 19 November 2008 also confirms the importance of receiving data in an electronic form and in the same level of detail as the original source data. Moreover, this matter was commenced over two years ago and it needs to progress in a timely way. This consideration favours a comprehensive discovery order rather than a series of separate applications and arguments. In this judgment I will not settle the final terms of the present discovery order but I indicate that I decline to make the vague general order as sought in the Amended Notice of Motion in Prayer 1. I think an order along the lines of Proposed Order 2(a) and (b) of the Amended Notice of Motion of 10 December 2008 would be an appropriate next step. The Draft Data request on pages 81 and 82 to the Affidavit of Ms Gilsenan points to the difficulties in framing a more specific request for documents and indicates that, in my view, more thought needs to be given to the specific terms of the discovery having regard to these reasons. I therefore direct the parties to ring in Short Minutes to give effect to these reasons. As to costs, if there is any dispute as to these they can be resolved when the matter comes back before the Court. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin. | discovery form of orders for further discovery of documents and computer codes level of discovery which should be made practice and procedure |
Orders were also sought against officers and former officers of those companies. The first to eighth defendants were those named as defendants when the proceedings commenced. 2 On 20 April 2006 receivers were appointed to the property of all of those named as defendants with exception of the seventh defendant, Bowesco Ltd which was subject to a private receiver appointed under a security. Freezing orders were made in relation to its property. The reasons for all the orders made were set out in Re Richstar Enterprises Pty Ltd; Australian Securities & Investments Commission v Carey (No 3) (2006) 232 ALR 577. Those orders commenced a long and winding trail of interlocutory processes involving the ultimate joinder of four additional defendants, orders in respect of each of them, other than the eleventh defendant, and variations to make all of the orders more effective and to deal with practical difficulties encountered in their administration. 3 The protective regime established by these proceedings has been extended from time to time. Orders presently in place in respect of the first, fifth to tenth and twelfth defendants have been further extended to 5pm today, 4 September 2007. Orders in relation to the second, third and fourth defendants, which are not before me for extension at this time, remain in force until 12 September 2007 in relation to the second and third defendants and the 26 September 2007, in relation to the fourth defendant. Orders in terms of a proposed minute with respect to the first and fifth defendants. 2. The discharge of existing orders against the sixth and eighth defendants. 3. The extension of existing orders against the seventh, ninth and tenth defendants to 31 January 2008 unless otherwise discharged or varied. 4. The extension of existing orders against the twelfth defendant to 31 January 2008 subject to agreed amendments. For the reasons that follow I am satisfied that the orders proposed should be made. The requirement that the order be "appropriate" does not mean that the Court will refuse to make it simply because it thinks a different order would be preferable. This is particularly the case where the parties are properly advised by competent legal representatives. An appropriate order is one which lies within the range of orders that could reasonably be made on the materials before the Court. The limiting factor is that in making any order the Court exercises the judicial power of the Commonwealth and cannot simply rubber stamp what is proposed without consideration of its substance. There were, however, some specific issues which I raised with the parties at the hearing on 27 August 2007 which have since been addressed by the filing of additional affidavit material. 6 Before turning to that evidence it is clear that there is no difficulty with the proposed discharge of orders against Westpoint Realty Pty Ltd (Westpoint Realty) and Redchime Pty Ltd, the sixth and eighth defendants. Any extension of orders against them or against any of the defendants would have to be justified to the level at which the Court could regard such an extension as "within power" for the purposes of s 1323. If ASIC has concluded that it does not wish the existing orders under s 1323 to continue with respect to those defendants, then there is no basis for continuing them. As they lapse of their own operation, there is probably no real need to make an order discharging them. To put the matter beyond doubt however, I will do so. 7 In seeking the continuation of current s 1323 asset preservation orders against the other defendants, albeit subject to agreed variations, ASIC has filed submissions relying upon a number of affidavits in support of the application and on the assumption that the application was to be contested. In that connection I have had regard to the affidavit of Brian Keith McMaster sworn 24 November 2006. Mr McMaster is one of the current Court appointed receivers in respect of the first to sixth, eighth and ninth defendants. That affidavit exhibited a report on the receiverships dated 24 November 2006. A further affidavit sworn by Mr McMaster on 1 August 2007 exhibited additional reports. Report dated 28 June 2007 on the receivership of the first defendant. 2. Report dated 4 July 2007 as a supplement to the report of 28 June 2007. 3. Report dated 19 June 2007 on the receivership of the fifth defendant. 4. Report dated 14 June 2007 on the receivership of the eighth defendant. 5. Report dated 14 June 2007 on the receivership of the ninth defendant. Mr McMaster deposed in his affidavit to the truth of the contents of each of those reports to the best of his knowledge, information and belief. 8 An affidavit of Mr Jacobson, a solicitor employed by the Australian Government Solicitor, exhibited a decision of the Real Estate and Business Agents Supervisory Board (the REBAS Board), delivered on 7 June 2007 which dismissed Mr Carey's application to renew his Real Estate and Business Agents Triennial Certificate --- Individual under Pt III of the Real Estate and Business Agents Act 1978 (WA). Mr Jacobson's affidavit also exhibited a copy of Mr Carey's affidavit sworn 9 May 2007 in support of his application to the REBAS Board. In the course of that affidavit Mr Carey referred to his extensive experience in the property development industry, academic and trade qualifications and other matters. He denied any wrongdoing in the management of the Westpoint Group and maintained that as a director he had acted professionally in accordance with his duties and obligations. He blamed the collapse of the Westpoint Group upon the intervention by ASIC and ill-conceived and negligent legal advice. He also referred to his financial position both as to income and as to assets and liabilities. That material is relevant to the appropriateness of continuing the protective regime and also arrangements for ongoing salary payments to Mr Carey by Richstar Enterprises Pty Ltd (Richstar). 9 In describing his financial position Mr Carey said that he has ongoing salaries of $405,451 per annum from which he draws a living allowance of $4,000 per week with the surplus accumulating in a bank account. The weekly living allowance is that approved by the receivers pursuant to orders made in these proceedings. Mr Carey exhibited an "updated statement of assets and liabilities" to his affidavit. That statement showed assets with an estimated current value of $1,169,547, comprising employee entitlements of $27,000, a one-sixth share in a racehorse valued at $4,000, what appear to be interests in Healthcare Properties Pty Ltd (Healthcare) and Westpoint Realty valued at $700,000 and $400,000 respectively and superannuation valued at $32,547. There was a sum for personal property valued at $6,000. Liabilities were said to be nil. A contingent liability comprising a claim by QBE Insurance (Australia) Ltd (QBE Insurance) under a guarantee was said to be $200,000. A note to the statement indicated that the claim by QBE Insurance is being defended. That company claims $3,600,000 against 18 other guarantors. Mr Carey said that his contingent liability was based on the claim being successful and the liability being shared by the guarantors. He told the REBAS Board that the statement of assets and liabilities was sufficient to satisfy the Board that he had enough assets to call upon to satisfy his obligations under the Act. He also observed that while asset preservation orders were currently in place they were specifically worded to enable the continuation of the ordinary course of business. He said he was able to access his assets and income to provide significantly greater financial resources than could ever be required on a worse case scenario under business models which he intended to operate. 10 Jan Louise Redfern, Executive Director of the Enforcement Directorate of ASIC swore an affidavit on 3 August 2007. She is responsible for the management of ASIC's investigations into the affairs of the Westpoint Group. She deposed that ASIC's investigation into Westpoint continues to be of national significance and high priority. She said that significant resources at every level continue to be deployed across jurisdictions to meet the demands of that investigation and related litigation. The investigation team established by ASIC currently numbers 28 persons, some of whom are in Perth and some of whom have transferred to interstate ASIC offices. She said that to date ASIC has commenced 51 investigations nationally against 65 individuals in relation to the Westpoint Group. On 20 April 2006 asset preservation orders were made in relation to the first to eighth defendants. 2. On 10 May 2006 orders were made in relation to the ninth defendant. 3. On 7 August 2006 orders were made joining the tenth and eleventh defendants and interim preservation orders were made in relation to the property of the tenth defendant but not in relation to the eleventh defendant. 4. On 29 January 2007 and 5 February 2007 the Court made orders and extended existing orders in relation to the first, fifth to tenth and twelfth defendants. Those orders provided for receivers and asset preservation orders to continue in effect until 30 June 2007. 5. On 8 March 2007 the Court dismissed ASIC's application to make asset preservation orders in relation to the eleventh defendant. 7. By orders made on 20 July 2007 current orders as against the first, fifth, seventh to tenth and twelfth defendants were extended to 27 August 2007. 12 Ms Redfern's affidavit set out the progress of ASIC's investigations. Given that the orders proposed are by consent it is not necessary to review the full detail of her evidence. She indicated that ASIC has identified possible contraventions by the defendants of the Act, the Australian Securities and Investments Commission Act 2001(Cth) (the ASIC Act) and/or relevant State criminal legislation. Two primary investigations are referred to as the "fund raising investigation" and the "asset stripping investigation". 31 December 2007 for the fund raising investigation. 2. 31 December 2007 for the asset stripping investigation. She also referred to related investigations into the Kebbel Group of companies which found retail investors for the Westpoint Group. Orders have been obtained pursuant to s 1323 in the Supreme Court of New South Wales against Kebbel (NSW) Pty Ltd and its sole director, Mr Neil Burnard. 13 Ms Redfern stated that ASIC's investigation into the alleged commission of serious criminal offences by persons of interest are continuing. She anticipates that briefs of evidence will be provided to the Commonwealth Director of Public Prosecutions for assessment at different stages by 31 December 2007. This may or may not involve ASIC undertaking further investigative work following an assessment of the evidence by the Commonwealth Director of Public Prosecutions. The question whether any criminal charges are laid would be a matter for the Director. 14 Logistical issues continue to affect the progress of the investigation. These include the complexity of the conduct under investigation and its relationship to other Westpoint related investigations. Documentary evidence has continued to grow. As at 7 June 2007 ASIC's database contained 1,623,864 scanned hard copy documents and approximately 4,871,592 pages relevant to the Westpoint investigations. This represents an increase of 15,326 scanned hard copy documents or 45,978 pages. ASIC's review of the documents has been, and continues to be, a significant part of the Perth Westpoint investigation team's day to day activities. Other elements affecting the progress of the investigations include extensive forensic review of electronic information, management of witnesses and information and assessment of evidence given, availability of witnesses and the necessity to provide ongoing support to existing civil and criminal litigation including various winding up applications, the extension of freezing orders and the Burnard prosecution. 15 Ms Redfern said in her affidavit that ASIC seeks to ensure that the property the subject of the asset preservation orders continues to be preserved for the benefit of creditors and investors. She noted, inter alia, that external controllers have commenced or indicated they are likely to commence legal proceedings against some or all of the defendants for the ultimate benefit of creditors to the Westpoint Group. Liquidators of Ann Street Mezzanine Pty Ltd (In Liquidation) have instituted proceedings naming Mr Carey, among others, as a respondent. The ING receivers appointed to Westpoint Corporation Pty Ltd (Westpoint Corporation) have made demands upon Richstar and Silkchime Pty Ltd for payment of moneys and have indicated they will commence proceedings seeking recovery of the debts claimed. ASIC is presently considering whether to issue proceedings in the public interest under s 50 of the ASIC Act in the name of various entities within the Westpoint Group against, among others, Mr Carey, seeking the recovery of damages and, where appropriate, tracing claims. 16 It is sufficient for present purposes to say that these matters and additional material referred to in that affidavit indicate that the criteria in s 1323 of the Act which enliven the Court's powers to make orders under that section would be satisfied. 17 In an affidavit of Mr De Kerloy sworn 24 August 2007, apparently sworn at the request of ASIC, he put various documents before the Court comprising email exchanges between his firm and the Australian Government Solicitor's office (AGS) acting for ASIC and Corrs Chambers Westgarth, acting for the receivers. The affidavit exhibited a letter from AGS dated 16 August 2007 indicating ASIC's understanding that it was proposed that Healthcare as trustee of the Healthcare Property Trust (the Trust) distribute funds from the Trust to Westpoint Financial Services Pty Ltd (WFS) or for WFS to direct Healthcare to make the payment to its sole shareholder, Mr Carey. The AGS expressed the view that it was necessary for Mr Carey to make application to the Court to obtain appropriate orders permitting his client to proceed with the proposed distribution. Various concerns about the distribution were raised by AGS. These were responded to by Mr De Kerloy on 21 August 2007. By a further letter dated 23 August 2007 the solicitors for the receivers and managers of Westpoint Corporation Pty Ltd (Westpoint Corporation) referred to the proposal for the treatment of funds forming part of the Trust and confirmed that the Westpoint receivers were not aware of any claim they might bring against Healthcare and would be bringing an action on behalf of Westpoint Corporation to recover the sum of $81,518 plus interest and costs from WFS. This is relevant to a proposed fund for legal expenses to be established in the name of Mr Carey subject to restrictions as to its application. The Excluded Property would also include any distribution or loan from the Hilton Trust or the Healthcare Property Trust for Mr Carey's benefit. It would extend to any property paid or payable to Mr Carey in connection with the compromise or settlement of any claim or other chose in action. The property covered by the orders generally and subject to the control of the receivers includes that held in some 28 trusts which are listed in the order. Any wages payable to Mr Carey or distributions or loans from the Hilton Trust or the Healthcare Property Trust and any money held by the receiver under previous orders shall be paid into that account. 19 The receiver would have power to identify, preserve and secure Mr Carey's property for the benefit of potential creditors. He would also be empowered to take possession and control of property but not to sell, let or encumber it without prior leave of the Court or Mr Carey's consent. Mr Carey would remain free to carry on business. However he could not remove any property from any State of Australia or mortgage or deal with it or diminish its value. These restrictions also apply to the Excluded Property. 20 Clause 14 would allow Mr Carey to withdraw from the Carey Account legal, accounting and/or expert fees and disbursements in relation to various legal actions in which he is or has been involved and for securing legal, accounting and expert advice in relation to other specified matters. Maximum figures are payable for each of the actions and matters referred to. They total $125,000. The maximum could be increased by a Registrar of the Court. 21 Paragraph 16 provides that Mr Carey may withdraw from the Carey account and pay ordinary living expenses in an amount approved by the receiver from time to time and that there will be liberty to apply in respect of ordinary living expenses should the receiver retire before 31 January 2008. There are also travel restraint orders and record keeping and reporting obligations. 22 In my opinion the orders proposed in relation to Mr Carey are within power and are appropriate in the sense that they are within the range of appropriate orders that could be made. I am therefore prepared to make the proposed orders. 23 In order to deal with conflicts of interest that might arise the receiver has proposed an amendment to the orders in respect of Mr Carey by the insertion of a new paragraph 8A. I am prepared to make those orders. However Mr McMaster would be referred to as the "Supervisor" albeit with powers substantially the same as those he would exercise as receiver of Mr Carey's property. The designation "Supervisor" was proposed to avoid difficulties with third parties arising from the use of the word "Receiver". The difficulties were vaguely expressed. The difference is entirely cosmetic. However, a like term has been used in some other orders previously made. The appointment of Mr McMaster as "Supervisor" can only be justified as an exercise of the power under s 1323 to appoint a receiver of the company's property. Having reflected upon the appropriateness of the title, I doubt that any third party likely to be concerned about the existence of the receiver would have any difficulty in discerning that the "Supervisor" is in truth a Court appointed receiver. Although I have some hesitation about this aspect of the order, the regulator which is properly concerned with the protection of the public interest, has agreed to the designation. In the circumstances, I do not think I should interfere with that agreement. 25 There is a specific proposal that Mr Carey be paid by Richstar wages in the amount of $5,769.23 gross per fortnight, the net amount after PAYG withholdings to be paid into the Carey Account. There is also provision for the payment of $2,660 gross per fortnight to his sister, Karen Carey Hazell, who is the sole director of Richstar. I required some affidavit evidence of their ongoing roles in Richstar to be satisfied that there is a proper basis for the proposed payments. Mr Carey filed an affidavit sufficient to satisfy me, having regard to the agreement between the parties, that there is such a basis for the proposed payments. He said he is employed by Richstar as a property consultant and has been so employed with the consent of the Richstar receiver since July 2006. He is currently paid the proposed amount per fortnight and the net amount, $3,865 is paid to his individual receiver from whom he then receives a living allowance. 26 I bear in mind that the orders made against Mr Carey and Richstar constitute a drastic interference with their freedom to deal with the various assets otherwise under their control. Neither has yet been found to be liable for anything. These orders are essentially "holding orders" while ASIC completes its investigation. They cannot be used to impose any kind of penalty because of liabilities, criminal or civil, which might be sheeted home to Mr Carey at some time in the future. The question of his liability (if any) will not be resolved in these proceedings. I am satisfied that the quantum of the salary proposed is not such that the Court should refuse to make the orders. It will be paid into the Carey Account. The amount of the living allowance which may be drawn down from that account, remains subject to the approval of the receiver. Ms Karen Carey Hazell has been receiving the same salary of $2,660 since 4 July 2006. She says that she undertakes a variety of duties as a director of Richstar. These are set out in her affidavit. There is nothing to gainsay that. 27 I am prepared to make the orders proposed in respect of Richstar subject to an amendment to [14.2] proposed by the receiver. That sum would be available for the payment of legal fees and expenses already referred to. ASIC does not consent to the order, but does not oppose it. At the hearing I required an affidavit to be filed in relation to the way in which the proposed payment was to be effected. 30 Mr Carey's affidavit exhibited a letter of advice from Healthcare's accountants dated 28 June 2007. In that letter the accountants advised that there is no tax liability payable for either Healthcare or its creditor, WFS. WFS was owed $934,852 by Healthcare as at 30 June 2006. That sum is currently in Healthcare's account. The accountant pointed out that WFS could direct payment of the money to Mr Carey as its sole shareholder. What is now proposed is that the sum of $200,000 be distributed to WFS by Healthcare and lent to Mr Carey who would pay it into the Carey Account. 31 I am satisfied, given the purpose of the proposed expenditure and the way in which the proposed payment into the Carey Account is to be effected, that the order is appropriate. Mr Carey's involvement in the administration of these orders and associated legal issues is not cost free. It is more efficiently handled with proper independent advice subject to controls on the maximum expenditures that may be incurred in respect of any individual item. I will make the orders proposed in respect of Healthcare. Mr McMaster filed an affidavit in that regard. He and Mr Korda are currently jointly appointed Court receivers in relation to Mr Carey's property. Under the proposed orders Mr McMaster will continue alone as receiver. Mr Korda will not continue. 33 In his affidavit, Mr McMaster made reference to relevant private appointments. He and Martin Madden were appointed on 16 January 2006 as receivers and managers of Westpoint Management Ltd (Westpoint Management), as trustee for the Paragon Commercial Syndicate by Perpetual Trustee Company Ltd. On 24 January 2006 Messrs Korda, Zohar and Winterbottom were appointed as receivers and managers of Westpoint Corporation and Huntingdale Village Pty Ltd (Huntingdale Village) in its own capacity and as trustee for the Huntingdale Village Unit Trust. They were also appointed as receivers for Vannin Pty Ltd (Vannin) in its own capacity and as trustee for the Hay Family Trust. Those appointments were all made by Perpetual Nominees Ltd acting as custodian of the ING Mortgage Pool. Mr McMaster said he had formed the view that the inclusion of the property of the Controlled Entities the subject of his receivership under the orders relating to Mr Carey and the private appointments mentioned above might give rise to potential conflicts of interest. The amendments which he proposed, and to which I have already made reference, have been agreed by the parties as an appropriate way to remove potential conflict. 34 Westpoint Management, Huntingdale Village and Vannin are all named in the orders relating to Mr Carey as trustees of property effectively under his control. Under the proposed amendments Mr McMaster would have no power or authority in respect of those matters although the property held by those companies would remain subject to the general freezing order. 35 Mr McMaster also referred in his affidavit to claims that Westpoint Corporation may have against a number of companies associated with the Westpoint Group. They arise out of loans assigned by Westpoint Corporation to other entities within the Group prior to the appointment of external controllers. Under the proposed amendments, Mr McMaster would have no power or authority in respect of those claims or any transactions or matters relating to them. At the time of swearing his affidavit he had not been privy to any confidential information in his role as Court appointed receiver, save for information made publicly available during the course of the hearing in respect of WFS. He also referred to claims that Vannin may have against certain Westpoint entities and again pointed out that under the proposed amendments he would have no power or authority in respect of those claims. He said he had not been privy to any confidential information in his role as Court appointed receiver in relation to those entities. 36 Although the position in this respect is not ideal, I accept that the steps which have been taken are practical and acceptable in the circumstances and on that basis will make the amendments proposed by Mr McMaster to deal with those issues. The position will, of course, have to be reviewed in January. I certify that the preceding thirty-seven (37) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. | appointment of receivers and ancillary orders under s 1323 corporations act orders affecting corporate members and officers of failed property development group extensions of proposed orders consent orders criteria for acceptance of consent orders whether within power and appropriate provision for payment of ongoing salary to officers of corporate group provision for fund out of which principal officer could meet legal and other expenses associated with pending actions and matters avoidance of conflict of duties between court appointed receivers and receivers appointed under private instruments corporations |
The applicants, Michael Joseph Patrick Ryan and Antony Woodings (the Administrators), are the administrators of Allstate and seek to have that decision set aside pursuant to both s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) and s 39B of the Judiciary Act 1903 (Cth). The Evans are shareholders in Allstate and applied for, and obtained, the issue of summons for the examination of the Administrators and for the production of documents by them. Those examinations (and proceedings to challenge the decision to issue the summons) have been deferred pending this case. Summonses have also been issued for the examination of Matthew Gill, the second respondent, and for the production of documents by the third respondent, Macquarie Bank Limited (Macquarie). Each of those respondents supports the position taken by the Administrators. The Evans have expressly declined to take part in this proceeding. Allstate was a listed public company. Trading in its shares was suspended on 8 June 2001. The primary business of Allstate was the management of the gold mining operations conducted at an underground mine in Beaconsfield, Tasmania pursuant to the Beaconsfield Joint Venture Agreement. That Agreement had been entered into on 19 October 1992. APPL and ACN held a 51.51 per cent interest in the joint venture, with the remaining 48.49 per cent held by Beaconsfield Operations Pty Limited, Beaconsfield Tasmania Pty Limited and Beaconsfield Gold NL. The Joint Venture Agreement provided for a manager's lien in favour of Allstate over certain gold stocks for debts that it incurred. Macquarie was the financier of Allstate pursuant to securities ranking ahead of unsecured creditors. BankWest was the financier of the Beaconsfield companies pursuant to securities. The manager's lien ranked ahead of the securities in favour of the financiers. Macquarie was owed a substantial sum at the date of appointment of the Administrators. Macquarie was involved in the appointment of the Administrators and provided them with an indemnity. It agreed to fund continued trading of the joint venture. At some time between 8 June 2001 and the Administrators' report to creditors of 24 September 2001, the Administrators agreed with Macquarie and BankWest that $500 000 would be provided by the banks for payment to ordinary unsecured creditors of the joint venture in satisfaction of the manager's lien. The liability covered by the manager's lien was estimated by the Administrators to be $7.2 million and the total gross value of production available to meet the lien was estimated at $6.689 million. In the report to creditors the Administrators put forward reasons why the value of the production should be discounted to justify the negotiated payment of $500 000. The committee of creditors was said to have approved of the transaction. On 4 October 2001, the creditors of Allstate, APPL and ACN resolved that each company should enter into a deed of company arrangement. The deeds were executed on 12 November 2001. The deeds were amended on 8 January 2002 following resolutions of creditors on 17 December 2001. On 5 March 2002, the Administrators forwarded a circular to creditors proposing a further variation of the deeds to reflect a proposal put forward by Macquarie whereby it would purchase the debts totalling more than $77 million owed to Allstate by APPL and ACN for the sum of $300 000, which amount would be distributed to the unsecured creditors of Allstate. The proposal was discussed and approved at a meeting of creditors on 19 March 2002 and formalised on 28 March 2002. On or about 30 April 2002, Beaconsfield Gold NL released a report as to the operation of the mine for the quarter ended March 2002. It is contended by certain shareholders of Allstate that this report and the later annual reports of Beaconsfield are inconsistent with the material provided to the creditors of Allstate by the Administrators in March 2002. In October 2002, ASIC raised with the Administrators their failure to lodge financial records. On 18 November 2002, following complaints from shareholders in Allstate, ASIC commenced an investigation into the conduct of the administration by the Administrators that was not finalised until 26 February 2004. Examinations of four persons were conducted in the course of the investigation pursuant to s 19 of the Australian Securities and Investments Commission Act 2001 (Cth) (the ASIC Act), including the applicant Ryan and the second respondent (Gill). Books and records were required to be produced pursuant to s 30 of the ASIC Act. Mallesons Stephen Jaques (Mallesons) were engaged to act for the Administrators in connection with that investigation and Mr Hunt was the solicitor handling the matter. ASIC acknowledges that the Administrators cooperated in the investigation. On 21 November 2002, ASIC advised the Administrators that it had received complaints that the financial reports of Allstate prepared by the Administrators for the years ended 30 June 2001, 30 June 2002 and 30 June 2003, and intended to be put before the Annual General Meeting to be held on 24 November 2003, did not comply with the relevant accounting standards. This was to be investigated by ASIC. The Annual General Meeting was adjourned to 1 March 2004, ASIC having granted an extension for that purpose. A period of considerable oral and written communication between Mallesons and ASIC ensued with the objective of clearing the decks for the adjourned meeting. On 23 February 2004, ASIC advised the Administrators in writing that the investigation had concluded and that no further action would be taken. ASIC also wrote to certain complainants, including Mr Knapp of Honest Remark Pty Limited, to the same effect, but with additional detail. Copies of each of these letters were provided by Mr Shannon Maguire of ASIC to Hunt of Mallesons. There was a discussion between those persons on that day. There is an issue as to precisely what was said, particularly about legal advice having been received. It is unnecessary to consider that issue further. It is agreed that ASIC received both accounting and legal advice for the purposes of the investigation. The same may be said about other conversations between Hunt and Maguire on 26 February 2004 and 12 March 2004. As a result of complaints received, ASIC has investigated the inter-company loan assignment in detail --- including the amount paid by the Bank to the Company for the assignment, and the information provided to creditors by the Company's deed administrators in their report dated 5 March 2002. Among other options, the prospects of successfully litigating the cancellation of the DOCA variation and subsequent inter-company loan assignment, removal of the deed administrators and/or obtaining compensation from the deed administrators for the benefit of the Company's shareholders and/or creditors have been considered. Therefore, ASIC will not take any further action in relation to this issue. It is important to note that ASIC was required to consider the inter-company loan assignment and information provided to creditors in light of the circumstances as they existed at that time (i.e. March 2002), not on the basis of the Company's subsequent financial performance. The length of that process has been necessitated by the need for ASIC to properly consider a variety of discrete issues raised by complainants continuously over the period, a large volume of evidence and a number of complicated facts and legal issues. It has also been necessary for ASIC to obtain expert accounting and independent legal advice. We have also interviewed creditors and shareholders of the Company. However ASIC can only commence proceedings, or take other enforcement action, where the strength of the evidence obtained supports such action. We suggest that you obtain your own independent professional advice in this regard. Accordingly, ASIC will not disclose further details about its investigations into the Company. That Report incorporated, by reference, another earlier report as to the investigation. On 1 December 2004, the Deputy Executive Director of Enforcement of ASIC replied on behalf of the Chairman to various complaints by Knapp of Honest Remark Pty Limited about the ASIC investigation. ASIC is satisfied it has conducted an appropriate investigation, and rejects your accusations of incompetence or deceit on the part of any ASIC officer involved in the investigation, or made against ASIC generally. Accusations of deceit in particular are scurrilous and unfounded, and any such accusation aired publicly will be vigorously defended. ASIC stands by its decision. In those circumstances, especially considering your intimations of seeking publicity, I am unable and it is inappropriate for me to justify further ASIC's considerations of this matter. On 26 April 2005, proceedings were commenced in the Supreme Court of New South Wales (Equity Division) by Honest Remark Pty Limited seeking the appointment of a special purpose administrator for the purpose, inter alia, of examining the conduct of the Administrators. Honest Remark Pty Limited was funded by the same litigation funder as has supported the Evans. On 17 August 2005, following complaints received by it, ASIC wrote to Ryan with questions as to the financial reports for Allstate for the year ended 30 June 2004, which were responded to on 7 September 2005. The annual general meeting of Allstate was scheduled for 30 November 2005. Hunt spoke with Maguire to ensure that there were no outstanding issues with ASIC before the meeting and spoke to Maguire after the meeting to update him on the meeting. On 22 December 2005, after a preliminary telephone call from Maguire, ASIC wrote to Mallesons concerning a request made by Piper Alderman, solicitors, on behalf of Honest Remark Pty Limited for a transcript of the ASIC examinations of Ryan and Gill and related books. Submissions from Mallesons were requested by 27 January 2005. The time for submissions was extended until 10 February 2006 and the submissions opposing provision of the transcripts were provided on 9 February 2006. There had been telephone conversations between Mallesons and ASIC in the meantime. On 25 April 2006, a rock fall occurred at the mine causing operations to cease with wide publicity. On 5 June 2006, KP Farmer & Associates made an application for authorisation of the Evans as 'eligible applicants', supported by a number of documents. If we were to refuse to grant eligible applicant status because we have investigated and found insufficient material upon which to base a case, such decision would seem to be saying that our investigative process was of such a high standard that there is no room for another view. Further, such consideration would seem to go beyond ASIC's role of analysing and making a determination on the eligible applicant aspect solely. Gray considered the application made on behalf of the Evans, the material included with it, the Spear Report and the incorporated report, but not the attachments referred to in that report. Taylor considered Gray's memorandum. Taylor signed the authorisation on that day. In November 2002 ASIC commenced an investigation into administration of Allstate. The investigation was commenced following the receipt of a number of complaints from creditors and shareholders of Allstate. The subject of these complaints, and ASIC's subsequent investigation, included the matters of concern raised by this application. The investigation was finalised in February 2004 when it was determined that there was insufficient evidence to establish any contravention of the law. Sections 596A and 596B of the Act deal with the issuing of summonses for examination about a corporations examinable affairs. One of the criteria is that an application is made by an "eligible applicant". Other criteria concern the role played by the person to be summonsed. The definition of "eligible applicant" is found in section 9 of the Act and includes "a person authorised in writing by ASIC to make" applications under sections 596A and 596B. These provisions (and their predecessors) have been the subject of considerable judicial consideration. Some of the principles that emerge from these decisions include the following. The first stage is, where the prospective applicant is not one of the specified persons in section 9 of the Act, the authorisation of person by ASIC to make the application to the Court. The second stage of the process is the making of the application by the authorised person to the Court for the issue of the particular summonses. The first stage requires ASIC to consider the relationship which the applicant has to the corporation, and may also include matters personal to the applicant, such as the applicant's relationship to the person to be examined. The second stage requires the Court, in deciding whether to grant the examination order, to take into account different matters including the relationship between the examinee and the corporation as well as relationship between the applicant and the examinee. The question of whether in any particular case the applicant has used the procedure abusively will depend upon the applicant's purpose in seeking the order and all of the surrounding circumstances and it will not be an abuse unless an offensive purpose is at least the predominant purpose. Applying this principles to the evidence before ASIC, it would appear that the Evans, as shareholders of Allstate, are appropriate persons to be authorised to apply for the issue of examination summonses under sections 596A and 596B. Clearly the deed administrators cannot be expected to apply for summonses as it is there conduct which is proposed to be the subject of the examinations. Further, the applicant states that the purpose of the proposed examinations is to investigate whether there are causes of action available to Allstate and/or its shareholders, and is therefore, for the benefit of the company, its contributories and its creditors. There are two further matters which need to be specifically considered. Firstly, Ms Farmer's letter states that another shareholder of Allstate, Honest Remark Pty Ltd ("Honest"), has commenced proceedings against Allstate seeking the appointment of a special purposes administrator appointed to Allstate. Both Honest and the Evans are funded by the litigation funder IMF. Further, although the nature of the proceedings are different, it appears that the proceedings are concerned with the conduct which is to be the subject of the proposed examinations. These circumstances raise the question of whether there was an alternative purpose to this application, namely to obtain evidence or a forensic advantage to the Honest proceedings. However, I raised this issue directly with Ms Farmer, and she has assured me that this is not her clients' intention in making this application. Secondly, a question arises as to whether the fact of the ASIC investigation into these matters is a matter relevant for your consideration. In my view, it is a relevant consideration. However it is only likely to ever carry significant weight were the outcome of the investigation clearly establishes that the issue of the summonses amounts cannot, or is highly unlikely to, achieve its stated purpose. In such cases, the issue of the summonses would cause the examinees (and very often the company) to incur additional costs where there can be no benefit to the corporation. In this case the subject of the ASIC investigation was complex and accordingly, in my view, it cannot be said that the purpose of the examinations cannot be successful. I recommend that ASIC authorise Mr and Mrs Evans, as trustees for Kamiyacho, be authorised pursuant to section 9 of the Act to make applications under Part 5.9 of the Act in relation to Allstate. I note that in my view, ASIC is not required as part of this process to make applications in relation to specific proposed examinees. Rather, this will be a matter for the Court when it deciding any applications for the issuing of summonses that come before it. A suggested draft letter to the applicant is attached to this memorandum. The written submissions on behalf of the Administrators somewhat refined the grounds to be relied upon. The oral submissions refined those grounds further and clarified the points of substance upon which the Administrators rely. I will concentrate upon the arguments as so confined, leaving the ground of natural justice for separate consideration. The starting point for consideration is that, absent evidence from the decision maker Michael Taylor to the contrary, it can be taken that he acted upon, and only upon, the memorandum from Conrad Gray of 11 July 2006 in the sense that he took that memorandum into account in all respects for administrative review purposes. Taylor had before him the application made on behalf of the Evans, together with the Gray memorandum and no other material, although he obviously had access, if desired, to any part of the ASIC file. In particular, it is clear that he did not have regard to the Spear Report. I am satisfied that it is appropriate in the present case to act upon the basis that the reasoning of Gray was adopted by Taylor in the context of the application which was before him. It is then submitted that Gray's reasoning was based upon the analysis in Re Excel Finance Corporation Ltd (Receiver and Manager Appointed); Worthley v England (1994) 52 FCR 69 of the statutory provisions as they stood prior to the amendments which were in force at the time relevant to this case --- in particular by reference to the former s 597 rather than by reference to the present s 596A and s 596B. A particular complaint is that this caused no attention to be paid to the mandatory nature of s 596A. The first stage requires ASIC to consider the relationship which the applicant has to the corporation, and may also include matters personal to the applicant, such as the applicant's relationship to the person to be examined. The second stage requires the Court, in deciding whether to grant the examination order, to take into account different matters including the relationship between the examinee and the corporation as well as relationship between the applicant and the examinee. In my opinion, the point which is made, whilst correct insofar as it goes, does not affect the validity of the reasoning adopted. The discussion by Gummow, Hill and Cooper JJ in Re Excel 52 FCR between 79 and 88 explains the difference between the authorisation decision, on the one hand, and the issue of the summons on the other and puts the issue in its historical context. The Commission, in determining whether to grant authorisation, will consider the relationship which the person seeking authorisation has to the relevant corporation and the external management of that corporation which is in progress. Contributories and creditors would normally have the appropriate connection with the corporation (as the history of examination orders, already set out, demonstrates), although other factors relevant to a particular case may make the authorisation of such persons inappropriate. It is to the subject matter, scope and purpose of subs (1) to which attention must be given to resolve the present question, not the subject matter, scope and purpose of subs (3). That being the case, reference to the subject matter, scope and purpose of subs (1) leads to the conclusion that the decision-maker, in determining whether to authorise a particular person to make applications in relation to a particular corporation, will be required only to consider the relationship which that person has to the external administration and in a particular case the appropriateness of that person being given standing to apply to the Court under subs (2). The two stage process remains and there is nothing about the amendments which renders inappropriate the explanation of the proper approach to the first stage. It should be noted that historically any contributory could apply for an examination order. Furthermore, the relevant parts of the Gray memorandum refer to the authorities relevant to the new provisions and expressly refer to the new provisions themselves. It can be assumed that the decision maker, Taylor, was familiar with the statutory provisions. He was, after all, the delegate of ASIC. In my view, it is a relevant consideration. However it is only likely to ever carry significant weight were the outcome of the investigation clearly establishes that the issue of the summonses amounts cannot, or is highly unlikely to, achieve its stated purpose. In such cases, the issue of the summonses would cause the examinees (and very often the company) to incur additional costs where there can be no benefit to the corporation. In this case the subject of the ASIC investigation was complex and accordingly, in my view, it cannot be said that the purpose of the examinations cannot be successful. In November 2002 ASIC commenced an investigation into administration of Allstate. The investigation was commenced following the receipt of a number of complaints from creditors and shareholders of Allstate. The subject of these complaints, and ASIC's subsequent investigation, included the matters of concern raised by this application. The investigation was finalised in February 2004 when it was determined that there was insufficient evidence to establish any contraventions of the law. In the first place, it was said that the decision maker was obliged to seek more information to clarify par 23 ( Prasad v Minister for Immigration and Ethnic Affairs (1985) 6 FCR 155 at 170 and other authorities which have applied Prasad ). It was suggested that the decision maker would need to drill down to ascertain upon what basis the decisions had been made and ascertain how clearly or strongly the conclusion had been reached and so on. It seems to me that par 15 and par 16 state the outcome with sufficient clarity. The use which is sought to be made of par [23] is a good example of the tendency to parse and analyse administrative reports with a fine toothcomb contrary to Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259. A fair reading of the three paragraphs in question is that the complexity of the matter was such that the fact that ASIC had come to a particular conclusion did not preclude a different conclusion being arrived at by others, particularly with the benefit of the further examinations sought. In my opinion, the decision maker was not obliged to seek any further information. It needs to be borne steadily in mind that an unconstrained discretion was being exercised. There is a further difficulty with this argument. If the decision maker had drilled down to the Spear Report and the incorporated report it would have been apparent that the decision made by ASIC was based upon a number of debateable matters requiring judgment and that, indeed, the possibility of various forms of civil action were flagged but not precluded. The second way in which par 23 was attacked was that the reasoning was perverse and therefore unreasonable in the Wednesbury sense. It was said that complexity of itself provides no sensible basis for departing from the prior conclusion by ASIC itself. A matter could be complex but the outcome clear. The way in which I have held that par 23 should be understood was not unreasonable in any sense. There is, therefore, no need to explore the application of the Wednesbury principle in this context. The private examination of persons pursuant to Div 2 of Pt 3 of the ASIC Act in aid of an investigation by ASIC pursuant to Div 1 of Pt 3 has a different history, role and purpose from examinations pursuant to Div 1 of Pt 5.9 of the Corporations Act . The latter are a long standing feature of insolvency administration, the history, nature and purpose of which have been analysed in many cases --- most recently by Lander J in Evans v Wainter Pty Limited [2005] FCAFC 114 ; (2005) 145 FCR 176 and French J in Highstoke Pty Ltd v Hayes Knight GTO Pty Ltd [2007] FCA 13 and need not be repeated. Counsel for Gill advanced a variation upon these themes. It was submitted that ASIC was required to consider the nature, scope and purpose of the examinations foreshadowed in the application to ensure that there was a financial benefit to the corporation, that matter being regarded as relevant in the Gray memorandum. It is submitted that there was no analysis in the memorandum of the realistic possibility of there being any benefit to the company. The transactions in question were not effected by the Administrators but rather pursuant to the Corporations Act as a consequence of the resolution of creditors. There was no evidence that creditors had been misled or would have acted differently if they had been told more than they were, particularly when the financial realities were understood. The analyses of these issues in the Spear Report were not carried forward to the Gray memorandum. There was no examination of how Allstate would have a cause of action. This argument ignores the difference between the two stages of the process and assumes that it was mandatory for ASIC to form a view that successful litigation on behalf of Allstate would ensue. In the first place, there is no mandatory consideration of that kind in the statute. Secondly, it mistakes the nature of examinations. They are for the purpose of information gathering. The potential result would only be known at the conclusion of that exercise rather than at the beginning. Thirdly, it assumes that the only potential causes of action were those expressly dealt with by ASIC and that the only examinations proposed were those of the listed persons. That was not the basis of the application and was not the basis of the approval. Fourthly, it ignores the more general purposes of public examination of those connected with insolvent companies ( Rees v Kratzmann [1965] HCA 49 ; (1965) 114 CLR 63). Counsel for Macquarie also put a variation upon those themes. Reliance was placed upon some statements made by Lander J in Evans 145 FCR at 216---217 to erect a mandatory consideration, namely, that ASIC identify what was described as the 'net' benefit to a corporation of the proposed examinations, thus involving a calculus of benefits and detriments leading to a net benefit. The analysis by Lander J in the passage referred to above is, no doubt, valuable. It is not, however, a statute. It does not set out to lay down mandatory considerations for ASIC to consider before granting authorisation. It provides guidance as to what would be an abuse of process or an improper purpose. The statement that ASIC was only entitled to authorise a person who was an eligible applicant if that person's purpose in seeking an examination summons is for the benefit of the corporation, its contributories or its creditors must be understood in that context, ie, the purpose should not be a collateral purpose. There is no suggestion of any collateral purpose in the present case. Furthermore, Lander J does not hold that it is mandatory for ASIC to expressly weigh up all potential benefits and detriments to find a 'net' benefit before granting authorisation. The argument is an attempt to incorporate mandatory provisions into an unconstrained statutory discretion. It is convenient to deal with the argument that the statute impliedly required natural justice be accorded to the Administrators prior to considering the argument that the dealings between ASIC and the Administrators led to a legitimate expectation on the part of the Administrators that natural justice would be accorded to them. Counsel for the Administrators was unable to refer to any like case in which the point has been taken. Even more striking is that the point does not appear to have been taken in relation to the issue of a summons for examination, a decision with direct and immediate impact upon the examinee which has often been challenged. In my opinion, the argument does not withstand analysis, although it has some initial attraction. Dawson J (178 CLR at 437) expressly referred to personal reputation as being a sufficient interest to require observance of the rules of natural justice concerning a decision by the predecessor of ASIC to release confidential transcripts to a Royal Commission and consent to the use of them in public hearings. McHugh J used words to the same effect (178 CLR at 470---471) and Brennan J was impliedly to the same effect (178 CLR at 430). It is a reasonable assumption that the examinations will be held in public and that the topics to be explored will involve airing allegations which would be detrimental to the reputation of the Administrators. It is also likely that there will be some media publicity as to those allegations. It is also submitted that the common law right to maintain silence will be encroached upon. It is not clear to me that the so called common law right to silence is a right or interest in the sense outlined in Annetts v McCann [1990] HCA 57 ; 170 CLR 596 . The only authority that was cited to support that proposition, apart from the reference in the passage from the reasons of Dawson J in Johns v Australian Securities Commission 178 CLR at 437, was that of Branson J in Re Cortaus Ltd (in liq); Sheahan v Joye (No 2) (1996) 20 ACSR 576 at 578. That was an examination of the balance of convenience on an application for a contested adjournment and did not involve the present issue. There is merit in the submission by counsel for ASIC that it is hardly correct to say that an officer of a company that is in external administration has any right to silence concerning the affairs of the company. On the contrary, the officer is bound by statute, when called upon, to provide information. That has been the case for a very long time ( Rees v Kratzmann [1965] HCA 49 ; 114 CLR 63; Evans v Wainter 145 FCR per Lander J at [44]---[82]; per French J in Highstoke Pty Ltd v Hayes Knight GTO Pty Ltd [2007] FCA 13 at [46] ---[78]). It is submitted on behalf of the Administrators that the decision gave the Evans a new right or status which they did not previously have or enjoy. In the circumstances of the case it was a right which would inevitably lead to a mandatory court order for a compulsory public examination of the Administrators. Thus, that right or status would, it is argued, necessarily and directly affect the rights and interests of the Administrators. There was no pre-existing right and no possibility of correlative prejudice to the Administrators unless and until ASIC conferred the status of eligible applicant on the Evans. The decision was not appealable to or reviewable by, for example, the Administrative Appeals Tribunal. The question is whether the decision in question prejudiced the rights of the Administrators. There is some debate as to whether the relevant power being exercised is that conferred by s 11(4) of the ASIC Act or the substantive provisions of the Corporations Act . The better view in this Court is the former ( Re Excel 52 FCR at 82). Whether the correct answer is either or both is of little significance for the resolution of the present issue. The power is unconstrained by any express provision and the only effect of the impugned decision is to put the appointee in a position to apply for a summons pursuant to s 596A and s 596B of the Corporations Act as an eligible applicant. That appointment has no effect upon any other person. The interests of other persons are not affected unless and until a summons is issued. The focus upon the Administrators in this case tends to distort perspective. It does not even follow that the issue of a summons for examination and the conduct of the examination will have an adverse impact upon all potential examinees. An examinee may be asked to give an account of what occurred in the affairs of the company without any reflection upon the examinee or the disclosure of any information personal to the examinee. Examinations may be conducted in order to obtain information without any defined target and, even if there is a defined target, many examinees will not be that target. Given the width of s 596A and s 596B , it is apparent that it would be quite impractical to give notice to all persons who might be conceivably affected by the appointment of a person as an eligible applicant in relation to the affairs of a particular corporation either as a potential examinee or a person potentially affected by evidence to be given by an examinee. In the present case it may be accepted that, at the time the decision was made, the Administrators had been identified as both targets and examinees. Thus, in a practical sense, a grant of the status of eligible applicant was a step towards an examination which was either inevitable or highly likely. In my opinion, that practical consequence does not mean that the difference between the stages explained in Re Excel 52 FCR 69 can be elided. The circumstances of the particular application for exercise of the power do not affect the question as to whether the implied obligation has any operation in relation to the power in question. The decision to authorise the Evans did not itself directly adversely affect the interests of others in the manner required to bring the statutory presumption into play. Section 316 of the Commonwealth Electoral Act 1918 (Cth) provided, inter alia, that an authorised officer of the Electoral Commission could issue a notice requiring the production of documents where the officer has reasonable grounds to believe that a person is capable of providing documents relating to a possible contravention of certain parts of the Act. Sheppard J held that the officer was not obliged to give a recipient an opportunity of making submissions as to why the notice should not be served or why it should be limited in a particular respect, nor to foreshadow to the recipient the nature of her belief in relation to a possible contravention of the Act. Nothing that she could do could affect any right or interest which he has or expose him, except by the operation of the Act itself, to conviction for any offence or the risk of such a conviction. In the light of the decision in Kioa v West [1985] HCA 81 ; (1985) 159 CLR 550; 62 ALR 321, it is probably true to say that few statutes will be construed in such a manner as to deny to persons affected by action taken under them procedural fairness. The question in each case is what does procedural fairness require. In my opinion, it did not require Mrs Gladwin to give Mr Hare any opportunity of making any submissions to her at all about whether the notice should be issued or what the form of it ought to be. On the one hand, it is a stronger case. The effect upon the recipient of the notice was direct and immediate rather than indirect. The right to maintain the privacy of documents was directly affected. On the other hand, there was no reference to damage to reputation, as public disclosure was apparently not involved. However, on the whole, it tends to support ASIC's position. The same question would apply to the issue of a summons to give evidence or produce documents to a Royal Commission or other administrative body with compulsory powers, eg, the Administrative Appeals Tribunal. There is a plethora of provisions that do not involve a hearing, but result in the compulsory acquisition of information and documents that can be used publicly later by the regulatory authority concerned, eg, notices pursuant to s 155 of the Trade Practices Act 1974 (Cth) and s 263 and s 264 of the Income Tax Assessment Act 1936 (Cth), search warrants pursuant to Pt 1AA Div 2 of the Crimes Act 1914 (Cth) and telephone interception warrants pursuant to the Telecommunications (Interception) and Listening Device Amendment Act 1997 (Cth). Counsel for the Administrators was not able to cite any authority that has imposed a duty to hear any person before exercising any such powers, notwithstanding the expansion of the application of natural justice since Kioa v West [1985] HCA 81 ; (1985) 159 CLR 550. I have already noted that no authority was cited to suggest that either the authorisation of an eligible applicant or the issue of a summons for examination has previously been challenged on this basis. The decision of the New South Wales Court of Appeal in Commissioner of Police v Reid (1989) 16 NSWLR 453, cited by counsel for ASIC, is, at least, consistent with his submission and, on one view, directly supports it. The issue of substance before the High Court concerned the validity of decisions on the part of the Australian Securities Commission (ASC) to release transcripts of private examinations of Johns by the ASC to a Royal Commission in circumstances which allowed the information released to be published generally (see 178 CLR at 421). The Australian Securities Commission Act 1989 (Cth) provided for the examination of persons on oath as ancillary to an investigation by the ASC. Such an examination was to take place in private (s 19). Privacy has been observed in conducting such examinations out of consideration for the commercial reputation of the company and the protection of witnesses. His Honour was of the view that confidentiality of the information contained in the transcripts of examination was amenable to protection by Johns by injunction where its use or disclosure was not authorised by statute (178 CLR at 427). That being the case, it was not a long step to hold that the statute implicitly provided that Johns was entitled to prior notice of any decision to affect his statutory right to confidentiality in the information in particular existing transcripts by authorising the release of those transcripts on a basis that would destroy that confidentiality. The same can be said of Testro Bros Pty Ltd v Tait [1963] HCA 29 ; (1963) 109 CLR 353 that was effectively overruled by Annetts v McCann (per Mason CJ, Dean and McHugh JJ 170 CLR at 598) and Ainsworth (per Mason CJ, Dawson, Toohey and Gaudron JJ 175 CLR at 576---577). In my opinion, the initiation of the exercise of a statutory power of an investigatory nature will not normally 'destroy, defeat or prejudice' (to use the words from Annetts v McCann [1990] HCA 57 ; 170 CLR 596) or 'imperil' (to use Meagher J's word) any relevant right or interest such as to require notice to be given to the object prior to exercise of the power. In any event, where, as here, the exercise of a power is anterior to that which has a direct effect upon the party, there is no such requirement. For the sake of completeness I should deal with two arguments raised on behalf of ASIC, each of which I would reject if I had been of a different view concerning the duty to accord natural justice. The first was that the decision here was a step or stage in a process, the end result of which would entail procedural fairness ( Ainsworth per Mason CJ, Dawson, Toohey and Gaudron JJ 175 CLR at 578; South Australia v O'Shea [1987] HCA 39 ; (1987) 163 CLR 378 per Mason CJ at 389). It was argued that the position was not dissimilar to the lack of any requirement to afford a hearing prior to the commencement of a prosecution of a like proceeding ( Barton v The Queen [1980] HCA 48 ; (1980) 147 CLR 75 at 95; Cornall v AB (A Solicitor) [1995] 1 VR 372 at 396---397; Commissioner of Police v Reid 16 NSWLR at 461; Australian Securities and Investments Commission v Plymin (No 3) [2002] VSC 358 ; (2002) 170 FLR 128 at 135---136). In the first place, it is doubtful whether there is a single decision making process of the kind referred to in the present circumstances. The decision by ASIC in relation to authorisation involves different questions and different issues than would a decision to issue a summons by the Court or the conduct of the proceeding itself (cf McHugh J in Johns v Australian Securities Commission 178 CLR at 473---474 and see Re Excel 52 FCR at 83---84 and 86). It is difficult to see how failure to accord natural justice in relation to the decision in question could be cured by later events. In the second place, the examination procedure is not designed to accord natural justice to a party in relation to any allegations made, directly or indirectly, against the examinee. The process is inquisitorial rather than adversarial. There is no case put against the examinee or any case in reply. If the legislature thinks that in this field the public interest overcomes some of the common law's traditional consideration for the individual, then effect must be given to the statute which embodies this policy. ) The fact that the Court maintains considerable control over the examination does not change the information gathering nature of the function being performed. The analogy with the institution of Court proceedings is not apt. It was submitted that ASIC had received significant submissions from or on behalf of the Administrators in relation to the original investigation and in relation to the release of transcripts which said all that could be said, as was revealed by the nature of the response made when the authorisation was known. Counsel for ASIC submitted that the evidence suggested that ASIC took those considerations into account. Some of the difficulties of applying the Stead principle were discussed by McHugh, Gummow, Callinan and Heydon JJ in Applicant NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] HCA 62 ; (2004) 221 CLR 1 at [34] . In the present case, the question was whether particular persons should be appointed as eligible applicants. I can see no evidence that that topic was addressed in the submissions made on behalf of the Administrators prior to the decision being made. Counsel for the Administrators identified seven features relating to those communications which, it was submitted, gave rise to a legitimate expectation on the part of the Administrators that the decision to appoint the Evans as eligible applicants would not be made without prior notice to the Administrators and without giving them an opportunity to put arguments against that course. The features were the fact of the previous investigation; its finding and its conclusion; the written communications by ASIC to the Administrators about its investigations; ASIC's oral communications with the Administrators' legal representatives; a continuing cooperative relationship with ASIC after the investigation in relation to ongoing complaints from shareholders; the procedural fairness which ASIC thought it appropriate to accord to the Administrators in relation to the request by a minority shareholder to have access to the s 19 transcripts; ongoing adverse media speculation including allegations of misconduct against the Administrators from 2002 to 2006; and the mandatory terms of s 596A itself. The place of so called 'legitimate expectation' in administrative law has always been controversial. It was considered most recently by the High Court in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6 ; (2003) 214 CLR 1 per Gleeson CJ at [26]---[38]; per McHugh and Gummow JJ at [47]---[49], [61]---[83] and [103]---[106]; per Hayne J at [116]---[122]; per Callinan J at [140]---[148]. In my opinion, that discussion is inconsistent with the features in the dealings between the parties here that were identified as giving rise to or creating an obligation to give notice to the Administrators before exercising the statutory power in question. I should add that the ASIC publication concerning natural justice (Australian Securities and Investments Commission, Policy Statement 92: Procedural Fairness to Third Parties, Australian Securities and Investments Commission , Canberra, 1995) does no more than purport to give effect to the requirements of the law. The submissions in question were an answer to the argument that par 23 of the Gray Memorandum was irrational. In such a complex case, Mr Gray, in his memorandum to Mr Taylor, was entirely reasonably adverting to the possibility that ASIC's own conclusion as to prospects was not infallible or the only view which could be said to be reasonably or even possibly open, especially in circumstances where ASIC had only examined four persons and the applicants had signalled an intention to examine additional persons. The most that can be said of the material is that it indicated that there was insufficient evidence for ASIC to take action. ASIC is a public body with has limited resources to take legal action. As a public prosecutor, ASIC needs to exercise caution before taking steps against private persons. It does not follow from there being insufficient prospects of success for ASIC to take action that there are insufficient prospects of success for a private person to take action. For the same reason, it did not follow from this result of the investigation that the examinations would be futile. It followed that it would be unfair not to have such access to counter that which was put forward on behalf of ASIC. 76 Rio Tinto [2006] FCAFC 86 ; 151 FCR 341 concerned an interlocutory discovery issue. In DSE (at [58]) Allsop J put the matter somewhat more descriptively, saying waiver arises when: "the party entitled to the privilege makes an assertion (express or implied), or brings a case, which is either about the contents of the confidential communication or which necessarily lays open the confidential communication to scrutiny and, by such conduct, an inconsistency arises between the act and the maintenance of the confidence, informed partly by the forensic unfairness of allowing the claim to proceed without disclosure of the communication". It was not necessary to decide that question as I was not persuaded that the application should succeed on the basis put forward. The reasons in Rio Tinto 151 FCR from [64]---[68] make clear that it was a special case, depending upon the form of particulars given by the Commissioner. In my opinion, an argumentative submission that is responsive to an integer of the applicant's case and defensive of the respondent's position would not normally give rise to the type of inconsistency referred to by the High Court in Mann v Carnell [1999] HCA 66 ; (1999) 201 CLR 1 and applied on the facts of Rio Tinto [2006] FCAFC 86 ; 151 FCR 341 (cf Bennett v Chief Executive Officer of the Australian Customs Service [2004] FCAFC 237 ; (2004) 140 FCR 101). I could see no special feature of the present case to displace that position. The proceeding will be dismissed and the applicants ordered to pay the costs of the first and fourth respondents limited to one set of costs. | authorisation by asic of shareholders as eligible applicants for s 596a and s 596b of the corporations act 2001 (cth) no notice to proposed examinees natural justice legitimate expectations whether asic took into account irrelevant consideration, failed to take into account relevant consideration and erred in law proceeding dismissed judicial review authorisation by asic of shareholders as eligible applicants for s 596a and s 596b of the corporations act 2001 (cth) no notice to proposed examinees natural justice legitimate expectations whether asic took into account irrelevant consideration, failed to take into account relevant consideration and erred in law proceeding dismissed submissions for respondent did not waive legal professional privilege 'eligible applicant' corporations law administrative law evidence words and phrases |
The appeal, although said by Mr Singh to be brought pursuant to the Administrative Decisions (Judicial Review) Act 1977 (Cth), was actually brought pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (" AAT Act "), and is confined to questions of law. Though styled an "appeal" it is in fact an application brought in the original jurisdiction of the Court. 2 The Tribunal dismissed, as frivolous and vexatious, Mr Singh's application for review of a decision of the Social Security Appeals Tribunal ("SSAT") made on 22 March 2006. It also directed that he not, without leave of the Tribunal, make any future application with respect to recovery of sickness allowance, disability support pension or wife pension paid between 28 October 1991 and 26 October 1999. 3 Mr Singh contends that the Tribunal did not have jurisdiction to make the decision that it did, or to give the direction that it gave. When Mr Singh asserts that the Tribunal did not have "jurisdiction" to do either of these things, what he really means is that the Tribunal erred in law in exercising its undoubted powers. Gray J summarised a large part of that background in his judgment dated 23 December 2004: Singh v Secretary, Department of Family & Community Services [2004] FCA 1685. The Tribunal also summarised the history of this matter in its decision dated 3 July 2006. 8 Mr Singh was born in 1950. He was employed by the Public Transport Corporation from 1983, initially as a tram conductor, and later as a tram driver. 9 On 2 January 1991, Mr Singh suffered a work-related injury, which resulted in an ongoing medical condition. Between 12 June 1991 and 30 November 1993, following an admission of liability, Mr Singh received weekly compensation payments from an insurer, pursuant to the Accident Compensation Act 1985 (Vic). 10 Between 28 October 1991 and 6 December 1991, and between 1 October 1992 and 14 October 1992, Mr Singh also received sickness benefits, pursuant to the Social Security Act 1991 (Cth), totalling $262.80. After the cessation of his weekly compensation payments, from 16 December 1993 to 26 October 1999, Mr Singh received payments of disability support pension, pursuant to the Social Security Act , totalling $44,185.27. During the same period, Mr Singh's wife, Ms Amarjit Kaur, received a total of $44,185.27 by way of disability support wife pension. The total amount received by Mr Singh and Ms Kaur up to 26 October 1999, pursuant to the Social Security Act , was $88,633.34. 11 On 10 March 1995, as a result of the settlement of a proceeding commenced by him, Mr Singh received a lump sum compensation payment of $55,153, pursuant to the table of maims in s 98 of the Accident Compensation Act . 12 Subsequently, Mr Singh commenced a further proceeding, seeking to undo the settlement of his claim, and to resume the payment of weekly compensation payments. On 20 October 1999, the County Court made an order requiring the insurer to pay to Mr Singh arrears of weekly compensation from 1 September 1992 to 20 October 1999, and for such payments to continue in accordance with law. In consequence of the judgment, the total sum of arrears of weekly compensation was $129,382.92. Mr Singh was also held to be entitled to receive a lump sum of $80,000, pursuant to the table of maims. From this was deducted the amount of $55,153, which had been paid to Mr Singh pursuant to the previous settlement. As a result, he received a further sum of $24,847 on 22 November 1999. 13 On 4 November 1999, Centrelink advised the insurer that it was obliged to pay to Centrelink $88,633.34 in respect of payments of social security, received by Mr Singh and Ms Kaur, between 28 October 1991 and 26 October 1999. The insurer repaid this sum to Centrelink, out of monies it would otherwise have paid to Mr Singh, pursuant to the judgment of the County Court. Also on 4 November 1999, Centrelink advised Mr Singh of its decision to recover the amount directly from the insurer. Centrelink cancelled Mr Singh's disability support pension and Ms Kaur's wife pension, because the payment of weekly compensation precluded any such payments. 14 Mr Singh and Ms Kaur sought review of Centrelink's decision of 4 November 1999 on the basis that, although formally married, they had been living separately under one roof from about 1996. 15 On 23 December 1999, Centrelink decided that Mr Singh and Ms Kaur were to be treated as members of a couple. On 21 January 2000, an authorised review officer affirmed the decision of 23 December 1999. Mr Singh sought review of that decision in the SSAT. 16 The SSAT then set aside the decision made by Centrelink on 4 November 1999 to recover $44,185.27, representing the total amount paid as wife pension from 16 December 1993 to 22 October 1999, from Mr Singh's arrears of periodic compensation. It remitted the matter to Centrelink for reconsideration in accordance with a direction that Mr Singh and Ms Kaur had not been members of a couple since 29 October 1996. However, the SSAT affirmed the decision by Centrelink to cancel Ms Kaur's wife pension. 17 In separate applications, Mr Singh and Ms Kaur then sought review by the Tribunal of the decision made by the SSAT. Ms Kaur subsequently withdrew her application on 8 May 2000. On 30 October 2000, the Tribunal set aside that part of the SSAT decision regarding arrears. It also determined that Mr Singh and Ms Kaur be treated as members of a couple at all relevant times. 18 Mr Singh then appealed to the Federal Court. On 19 December 2000 Finkelstein J made a consent order dismissing that proceeding with no order as to costs. 19 Mr Singh then appealed to the Full Court of the Federal Court seeking to revoke the orders made by consent by Finkelstein J. That appeal was dismissed by Beaumont, Kiefel and Hely JJ on 21 September 2001: Singh v Secretary, Dept of Family & Community Services [2001] FCA 1281. 20 Following further requests from Mr Singh, Centrelink wrote to him on 22 January 2002 stating that it had reviewed his case and decided not to change its decision to recover a compensation debt of $88,633.34. Mr Singh asked that the matter be referred to an authorised review officer. On 4 February 2002, an authorised review officer informed Mr Singh that he had no power to review the matter as it had already been reviewed by the SSAT, as well as the Tribunal itself. Mr Singh then lodged a further application with the SSAT on 19 February 2002. The SSAT decided on 13 May 2002 to again affirm the decision under review. 21 Mr Singh then lodged a further appeal to the Tribunal, which on 17 December 2002 affirmed the decision of the SSAT dated 13 May 2002. On 2 January 2003, Mr Singh appealed to the Federal Court seeking to set aside the Tribunal's decision of 17 December 2002. On 19 March 2003, I ordered that Mr Singh's application be transferred to the Federal Magistrates Court. On 5 December 2003, Hartnett FM dismissed the appeal with costs: Singh v DFCS [2003] FMCA 566. Mr Singh appealed to the Federal Court, and the appeal was heard by Gray J. On 23 December 2004, his Honour dismissed the appeal with costs: S ingh v Secretary, Department of Family and Community Services (Centrelink) [2004] FCA 1685. On 9 September 2005, the High Court dismissed an application for special leave to appeal, with costs: Singh v Secretary, Dept of Family and Community Services (Centrelink) [2005] HCATrans 759. 22 Mr Singh then filed a notice of motion in this Court seeking to set aside the reasons for judgment and the orders of Gray J made on 23 December 2004. On 24 October 2005, Gray J dismissed the motion, with costs: Singh v Secretary, Department of Family and Community Services [2005] FCA 1625. 23 Undaunted, on 6 February 2006 Mr Singh sought to issue a further notice of motion. That matter was heard in chambers by Ryan J who on 8 March 2006, directed the Registrar not to accept the notice of motion: Singh v Secretary, Department of Family and Community Services [2006] FCA 189. 24 In the interim, on 31 October 2005 Mr Singh wrote to a delegate of the Secretary to the Department of Family and Community Services requesting a recalculation of the compensation debt. A Centrelink officer refused that request, citing the various decisions previously made by the Federal Court. That decision was affirmed on review by an authorised review officer, and on 22 March 2006, on appeal to the SSAT. That application resulted in the Secretary, Department of Employment and Workplace Relations making an application to the Tribunal to have Mr Singh's application dismissed as frivolous and vexatious, and to have him prevented, without leave, from re-agitating the issues that have given rise to the numerous proceedings identified above. 26 The Tribunal conducted a hearing on 19 June 2006. Mr Singh applied at the outset to have the Tribunal member, Mr John Handley, disqualified from hearing his application because Mr Handley was not "independent" having previously dealt with one of Mr Singh's many applications in relation to this matter. Eventually, Mr Singh withdrew that application and, as the Tribunal records (at [5]), consented to the matter proceeding before Mr Handley. 27 In its reasons for decision, the Tribunal set out in some detail the history of Mr Singh's attempts to avoid having to repay the various sums totalling $88,633.34. It noted that he had provided some 300 pages of documents in support of his application to review the decision of the SSAT dated 22 March 2006, and that when he discovered that the respondent would seek to have his application summarily dismissed he wrote attaching another 68 documents. In addition he subsequently provided the respondent with a further 17 page document and, when the hearing commenced, lodged a further seven page document being the contentions upon which he relied. 28 The Tribunal summarised Mr Singh's contentions as follows. He claimed that the application that he brought before the SSAT differed from his earlier applications because it raised a new and different issue, namely whether the payment of $129,382.87 (which he received as a lump sum) was a "lump sum compensation payment" or whether it was "arrears payments for the social security purposes". He further claimed that he was seeking, by the current proceedings, to have determined whether a decision of the Federal Court, Secretary, Department of Social Security v Cunneen [1997] FCA 1033 ; (1997) 78 FCR 576, was correct. 29 The Tribunal concluded that Mr Singh was attempting again to review decisions that had previously been made by Centrelink, by the Tribunal itself, by the Federal Magistrates Court and by this Court regarding his compensation recovery. It found that Mr Singh believed that he had a right to bring this latest proceeding because he was of the view that there had been a "conspiracy and fraud on the part of Centrelink and the Insurer". The Tribunal referred to the various documents lodged by Mr Singh, noting that they contained inflammatory and derogatory references regarding the conduct of officers of Centrelink, the Workers' Compensation insurer and his former solicitors. According to the Tribunal, Mr Singh alleged conspiracy, lies, fraud, betrayal of trust, deception and that innocent injured workers had been cheated. 30 The Tribunal noted that s 42B of the AAT Act was rarely invoked. It referred to the "repetitious appeals" lodged by Mr Singh as having no merit, and to the order of Ryan J on 8 March 2006 that the most recent application to this Court not be accepted because it amounted to an abuse of process. It described Mr Singh's constant attempts to re-litigate issues that had been conclusively determined against him as a waste of public resources, involving the harassment of persons, and as an abuse of process. 33 It formulated its direction preventing him from bringing further proceedings, without the leave of the Tribunal, with some care. Its aim was to ensure that Mr Singh was not precluded from seeking review of decisions that were unrelated to those that were the subject of the numerous challenges brought by him in recent years. He had the assistance of an interpreter, but generally seemed well able to communicate in English. 35 Put simply, Mr Singh's contentions seemed to be as follows. He submitted that the Tribunal had erred in having regard to what it described as a "long history" of the litigation involving his claims by including within that history "other past litigation". He submitted that there had been a number of proceedings involving a challenge, on his part, to a finding by Centrelink that he and his wife were, at all material times, a "couple" when in his view they were living separately and apart under the one roof. That issue was said to be distinct from, and unrelated to, the matter that he had sought to agitate before the Tribunal earlier this year. 36 Mr Singh argued that the reason that he had returned to the Tribunal, after having his previous claims rejected (and in the case of Gray J, twice rejected) was because Gray J, in his second judgment, had made it clear that this Court would not entertain an argument regarding facts found by the Tribunal, but only questions of law. Gray J rejected Mr Singh's contention that a misstatement of the law, without more, could constitute fraud and thereby trigger the operation of Order 35 r 7(2), allowing for a judgment or order that had been entered to be set aside or varied. 37 According to Mr Singh that caused him to read, for the first time, the reasons for decision given by the SSAT on 13 May 2002. There he discovered that Centrelink had apparently recorded, as a fact, that Mr Singh received periodic payments of compensation from the insurer until 30 November 1993 "and did not advise Centrelink of these payments". Mr Singh indignantly denied that assertion, maintaining that he had evidence that Centrelink had been told of the payments. He alleged fraud, on the part of Centrelink, as well as a number of other bodies. Rather it summarised the totality of Mr Singh's various attempts to avoid having to repay the sum of $88,633.34, and concluded that he was attempting again to review decisions that had previously been made by the Tribunal and various courts. 39 It would have been preferable had the Tribunal endeavoured to unravel Mr Singh's somewhat convoluted argument, and deal with it in more specific terms. The real reason why Mr Singh was correctly prevented from raising this issue of "fraud" before the Tribunal was because he ought to have raised it in 2002, when Mr Singh was provided with the SSAT's reasons for decision. However, Mr Singh did not raise this matter when he lodged his appeal to the Tribunal on 30 May 2002, and self-evidently the Tribunal did not address the point when it delivered its reasons for decision affirming the decision of the SSAT, on 17 December 2002. 40 Mr Singh submitted that the reason he had not read the SSAT's reasons for decision at the time he received them was because he was "not capable" of understanding all English, and that he had "no capacity to read". However, Mr Singh gave no explanation of why he had not organised for the document to be translated to him at that time. 41 Mr Singh is therefore confronted with the fact that, by reason of his failure to read the SSAT's reasons for decision, or to have them translated to him, he did not raise, on merits review, an argument that would have been open to him. This brings into play the estoppel discussed in Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 ; (1981) 147 CLR 589. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time. That broader form of estoppel applies to this case. I note that Ryan J, in his reasons for directing non-acceptance of process given on 8 March 2006, relied upon Anshun . Had Mr Singh read the 13 May 2002 reasons for decision, he would have seen the sentence to which he now objects. He could then, as part of ordinary merits review, have challenged the correctness of the assertion contained within it, and arguably gained some support for his broader challenge to the 4 November 1999 decision. His failure to read the reasons for decision, whether through "negligence, inadvertence or even accident" led to his not having raised the point at a time when something could have been done about it. He cannot now, years later, having failed at all stages to demonstrate relevant legal error, come back to the Tribunal, and thence to this Court, with a point that should have been raised long before this. 43 All this assumes, of course, that there is otherwise substance in Mr Singh's contention that Centrelink in some way acted dishonestly when it recorded Mr Singh as having failed to notify it of the payments that he had received prior to November 1993. The possibility that this was human error, rather than fraud, seems to have eluded Mr Singh. In substance, his argument was that the Tribunal could only direct that he not, without leave of the Tribunal, make a subsequent application to the Tribunal of the kind stipulated, and that the omission of the key words, marked in bold, meant that it had purported to prevent him from bringing proceedings anywhere in relation to those matters. 45 It would have been preferable, I think, had the Tribunal included the words "to the Tribunal" in its formal direction. Nonetheless, as a matter of construction, no one would read the direction as precluding Mr Singh from bringing proceedings in this or any other court, merely because the Tribunal used somewhat imprecise language in formulating what it set out to achieve. It is plain that the Tribunal has no power to prevent Mr Singh from seeking to agitate whatever claims he may have regarding the $88,633.34 claw-back, before any body or court other than the Tribunal itself. The words "to the Tribunal" are implicit in the direction. 46 Mr Singh contended otherwise. He submitted that the Tribunal's unrestricted formulation vitiated its direction entirely, and meant that he was at liberty to return to the Tribunal in relation to this matter as and when he saw fit. I reject that contention. The Tribunal's direction was neither erroneous, nor a nullity. It was simply not expressed as well as it could have been. 47 Out of an abundance of caution, and for no other reason, I will vary the language in which the direction was expressed by inserting the words "to the Tribunal" at the appropriate point. This necessitates allowing the appeal, but only for the limited purpose of enabling this variation to be made. 48 There is no substance in Mr Singh's broader contention that the Tribunal ought not to have invoked the power conferred by s 42B(1)(b) , effectively declaring him a vexatious litigant. 49 Although s 42B(1)(b) is couched in language that differs from that used in Order 21 r 1 of the Federal Court Rules the principles that underlie the making of a direction by the Tribunal are not dissimilar to those that apply to vexatious litigants in this Court. Order 21 r 1 requires a person to have instituted a vexatious proceeding and the Court to be satisfied that the person has "habitually, persistently and without reasonable grounds" instituted other vexatious proceedings. Section 42B does not require that the person act "habitually and persistently", but can be triggered by a single application which is frivolous or vexatious. Nonetheless, it is implicit in the section that a direction under s 42B(1)(b) will not be lightly made, and will normally require some element of habitual or persistent conduct. 50 It may be true, in a literal sense, that Mr Singh only sought to agitate his allegation that Centrelink acted fraudulently after Gray J dismissed his attempt to argue for a different variant of fraud in unsuccessfully seeking to have his Honour reconsider his earlier orders. However, the latest allegation is but one of a litany of attempts to challenge the 4 November 1999 decision to recover $88,633.34 from him. In accordance with established authority, the Tribunal was entitled to have regard to Mr Singh's entire dealings with Centrelink, including his numerous applications to have that decision reviewed. 51 Section 42B(1)(b) must be applied having regard to a fundamental principle of the rule of law. Every person has a right to apply to a tribunal, or a court, to seek remedies in consequence of an alleged infringement of his or her rights. Because a direction given under s 42B(1)(b) denies a person this right, it is a remedy that should not be invoked except in an extreme case. See generally Ramsey v Skyring (1999) 164 ALR 378 at 389-91 (per Sackville J). 52 In Freeman v National Australia Bank Ltd [2006] FCAFC 67 a Full Court observed (at [24]-[25]) that existing authority established that in determining whether particular proceedings are in fact vexatious, a court may take account of proceedings in other courts where, for example, they have authoritatively resolved the particular issue against the person instituting the proceedings. The Full Court also noted that the expression "habitually and persistently" implies more than "frequently", and suggests a degree of stubbornness on the part of the person in question. The element "without any reasonable ground" is of course to be determined objectively. It is immaterial that the person may believe in the justice of his or her argument, and may not understand that the argument has been authoritatively rejected. 53 The Full Court referred to the principles laid down in Hunters Hill Municipal Council v Pedler [1976] 1 NSWLR 478; Attorney-General v Wentworth (1988) 14 NSWLR 481; Jones v Skyring [1992] HCA 39 ; (1992) 109 ALR 303; Horvath v Commonwealth Bank of Australia [1999] FCA 504 ; Commonwealth Bank of Australia v Heinrich [2003] FCA 540 ; and Granich & Associates v Yap [2004] FCA 1567. It held that these cases accurately reflected the law on Order 21 r 2. 54 In my view, similar principles are applicable to s 42B(1)(b), and therefore to Mr Singh. The Tribunal was entitled to have regard to his persistence, over many years, in seeking to have set aside the 4 November 1999 decision. It was entitled to have regard to his entire course of dealings in relation to social security benefits since his accident in 1991, and the fact that his latest foray before it involved an argument that could, and should, have been addressed years earlier. In those circumstances, I can see no error in the Tribunal's having concluded that a limited direction of the kind given was warranted. 55 I note that Mr Singh raised a number of other arguments in both his written and oral submissions. However, as those arguments have already been the subject of earlier authoritative decisions in this and other courts, they do not take Mr Singh's application before me any further. 56 I will hear the parties as to costs. | appeal from administrative appeals tribunal tribunal dismissed application as frivolous and vexatious tribunal directed that applicant not bring any further application regarding particular social security benefits without leave whether tribunal erred in law whether tribunal entitled to have regard to entire history of proceedings. administrative law |
Grounds 2 to 4 of the appellant's notice of appeal relate to the Federal Magistrate's conclusion that the appeal was precluded by reason of the doctrine of res judicata (arising from the decision in SZHEW v Minister for Immigration and Citizenship (No 2) [2006] FMCA 1750 ( SZHEW No 2 )) and/or an Anshun estoppel (referring to Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 ; (1981) 147 CLR 589). Grounds 5 to 10 relate to the Federal Magistrate's dismissal of the appellant's claims of a denial of a fair hearing before the Tribunal by reason of inadequate interpretation. The first respondent ( the Minister ) filed a notice of contention seeking that the Court affirm the Federal Magistrate's decision on the grounds that: - (i) the decision in SZHEW v Minister for Immigration & Anor [2006] FMCA 1483 ( SZHEW No 1 ) gave rise to a res judicata, and (ii) the proceeding was an abuse of process. For the reasons given below, I have concluded that the proceeding is not precluded by the doctrines of res judicata or Anshun estoppel and does not constitute an abuse of process. Nevertheless, I have also concluded that the appeal must be dismissed as the appellant has not established any error by the Federal Magistrate about the alleged inadequate interpretation. He is from Fujian where the dialect of Fuqing is spoken. He arrived in Australia on 5 November 2004 and applied for a protection visa on 15 December 2004. He claimed to have practiced Falun Gong for years and to fear persecution in China on this account. The Minister's delegate refused the application on 7 March 2005. On 6 April 2005 the appellant lodged an application for review of this decision by the Tribunal. The appellant attended the hearing before the Tribunal on 27 July 2005. The Tribunal affirmed the decision of the Minister's delegate on 29 July 2005, with the decision sent to the appellant by letter dated 18 August 2005. The appellant applied for a review of the Tribunal's decision. The application was fixed for hearing before the Federal Magistrates Court on 25 September 2006. The appellant failed to appear. In SZHEW No 1 Scarlett FM dismissed the application on 25 September 2006 relying on r 13.03A(c) of the Federal Magistrates Court Rules 2001 (Cth) as then in force (dismissal for a failure to appear). The appellant filed a notice of motion seeking to set aside the orders of 25 September 2006 and thereby to reinstate his application as permitted by r 16.05 of the Federal Magistrates Court Rules as then in force. The appellant was not legally represented but had received legal advice about his application to set aside the orders. The appellant's affidavit in support of the motion said that he had changed address and did not receive notice of the hearing, only of the dismissal of his application. The substantive application grounds claimed that the Tribunal failed to consider two matters, being the appellant's illiteracy and its impact on his ability to study Falun Gong and evidence of a photograph showing the appellant wearing a Falun Gong badge. Scarlett FM dismissed this application in SZHEW No 2 on 27 November 2006. The reasons for decision in SZHEW No 2 disclose that the application to set aside the orders of 25 September 2006 was initially listed for hearing on 20 November 2006 when a Mandarin interpreter was present. The Minister did not appear and the appellant requested an interpreter in the Fujian dialect, Fuqing (at [8]). Scarlett FM adjourned the hearing and arranged for a Fuqing interpreter to be present on the next occasion. At the hearing on 24 November 2006 the appellant gave evidence assisted by a Fuqing interpreter about the reasons for his non-appearance (at [9]-[11]) and his claims that the Tribunal had erred (at [13]-[17]). As part of his evidence the appellant said he had "very little Mandarin" (at [15]) and also emphasised his lack of education and illiteracy (at [17]). Scarlett FM considered the merits of the appellant's claims of error by the Tribunal and concluded that his "independent examination of the material [did] not disclose any arguable case of jurisdictional error" (at [24]). Orders thus were made dismissing the notice of motion seeking that the orders of 25 September 2006 be set aside. The appellant sought leave to appeal in the Federal Court against this decision. On 1 March 2007 Gilmour J dismissed this application for leave in SZHEW v Minister for Immigration and Citizenship [2007] FCA 243. Again, the appellant was not represented but had received legal advice about his application for leave. The substantive grounds of review foreshadowed were the same as those considered by Scarlett FM. Gilmour J dismissed the application for leave as he was satisfied that there was no error by Scarlett FM (at [28]) and that the substantive grounds of review then relied upon had no reasonable prospects of success (at [29]). On 19 October 2007 the appellant filed a further application in the Federal Magistrates Court for review of the same decision of the Tribunal. That application was amended twice and, as amended, formed the basis for the decision the subject of this appeal. In this further application the appellant claimed for the first time jurisdictional error by reason of inadequate interpretation before the Tribunal. In SZHEW No 3 Federal Magistrate Orchiston dismissed this application on the grounds that res judicata and Anshun estoppel precluded the further application having regard to the decision in SZHEW No 2 . Federal Magistrate Orchiston also decided that the substantive ground of review (jurisdictional error by reason of inadequate interpretation) was unsustainable. The appellant appeals against the decision in SZHEW No 3 , effectively, on all grounds. The Minister's notice of contention is that the Federal Magistrate's decision is sustainable by reference to the decision in not only SZHEW No 2 , but also SZHEW No 1 and the principles about abuse of process. The Minister emphasised the decision in Linprint Pty Ltd v Hexham Textiles Pty Ltd (1991) 23 NSWLR 508 in which a default judgment entered in favour of a plaintiff was held to found a res judicata. The appellant observed, however, that there is no provision in the Federal Magistrates Act 1999 (Cth) or Federal Magistrates Court Rules equivalent to that in Linprint about the finality of all judgments and orders. It is also apparent that Linprint involved a default judgment in favour of a plaintiff and not a mere dismissal of a proceeding for failure to appear as was the case in SZHEW No 1 . A default judgment is a final decision whereas a dismissal for want of prosecution is not (see Spencer Bower, G. The Doctrine of Res Judicata . 3 rd ed. Butterworths: London (1996) at [163] and [164] (hereafter, Spencer Bower )). A dismissal for a failure to appear at a hearing is more akin to a dismissal for want of prosecution than a default judgment. The Minister also relied on Applicant A321 of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 306 in which Wilcox J held that a claim under s 39B of the Judiciary Act 1903 (Cth) which had been dismissed precluded a later claim under s 75(v) of the Constitution by reason of the principle of res judicata. In the present case, the Federal Magistrate applied this reasoning, thereby concluding that the new ground (inadequate interpretation) did not avoid the consequence that the further application was precluded by the doctrine of res judicata (at [44]-[46]). Yet in Applicant A321 of 2002 the first decision was heard and determined on the merits. The case did not involve a dismissal for want of attendance at the hearing and rejection of a subsequent application to set aside the orders. The appellant said the present case was analogous to Applicant A184 of 2003 v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 210 ALR 543 ; [2004] FCA 1076. In that case Hely J had dismissed an appeal seeking to set aside a decision of the Tribunal on the basis of an applicant's failure to appear and, in so doing, expressed the opinion that the appeal was hopeless in any event. The applicant applied for constitutional writs in the High Court to set aside the same decision of the Tribunal. The High Court referred this application to the Federal Court but the applicant filed his initiating process out of time. Mansfield J considered and dismissed the applicant's application to extend time. The application for leave to appeal against the decision of Mansfield J came before Lander J for determination. Lander J discussed the principles of res judicata in respect of default judgments (at [97]-[111]). His Honour concluded that the decision of Hely J was not a decision on the merits and decided no issue of fact or law (at [112]-[118]). Accordingly, Hely J's decision did not give rise to a res judicata. In Applicant A184 of 2003 Hely J's decision is equivalent to that in SZHEW No 1 . In SZHEW No 1 there was a mere dismissal for failure to appear without any consideration of the merits of the appellant's claims. This is clear from the fact that Scarlett FM dismissed the application for failure to appear relying on r 13.03A(c) of the Federal Magistrates Court Rules (as then in force) and not r 13.03A(e). The former permits dismissal if an applicant fails to appear. The latter permits the Court to proceed with the hearing in a party's absence. Lander J made a similar observation about the different methods of proceeding in Applicant 184 of 2003 (at [84]-[90]). In the present case, by way of contrast to Applicant 184 of 2003 , there was a further decision in SZHEW No 2 in which the merits of the appellant's claims were considered. In SZHEW No 2 Scarlett FM considered the merits of the application for review of the Tribunal's decision but for the purpose only of determining whether the orders dismissing the application should be set aside. If anything, the decision in SZHEW No 2 (an application to set aside an order, involving a discretionary decision) is analogous to that of Mansfield J in Applicant A184 of 2003 . Lander J did not need to consider the status of that decision other than to extent of noting that it was interlocutory so that the applicant required leave to appeal against it. The Minister sought support from the fact that, in this case, the appellant had explained the reason for his failure to appear, which explanation Scarlett FM (and Gilmour J) found unsatisfactory. In contrast, there had been no such explanation available with respect to the case before Lander J in Applicant 184 of 2003 (at [113]). I do not consider this circumstance of any real assistance. It seems to me that Lander J in [113] was doing no more than observing that other evidence might be relevant to the question of a res judicata; this is consistent with the view that a court is not limited to the terms of the order in deciding this question (Spencer Bower at [204]). Although it appears that the parties did not refer the Federal Magistrate to Applicant A184 of 2003 , the reasoning in that decision provides a detailed analysis supporting the Federal Magistrate's conclusion in SZHEW No 3 that the decision in SZHEW No 1 , not being a decision on the merits of the application, cannot found a res judicata. The Minister's notice of contention on that basis should not be upheld. Applicant A184 of 2003 does not, however, provide the appellant with much assistance in relation to the decision in SZHEW No 2 , on which the Federal Magistrate's conclusions of res judicata and Anshun estoppel were based. In SZHEW No 3 (at [42]) the Federal Magistrate considered that the decision in SZHEW No 2 became a final decision on the cause of action raised in the original application on the dismissal of the application for leave to appeal by Gilmour J. I agree that the decision in SZHEW No 2 became a final decision on Gilmour J dismissing the application for leave to appeal. The question is whether it was a final decision on the merits of the cause of action raised in the original application (so as to preclude any further application) or merely a final decision on the merits of an application to set aside the order (so as to preclude only any further application on that cause of action). This question involves consideration of the steps necessary to the decision in SZHEW No 2 (see the discussion in Spencer Bower at [183]-[186]). The appellant submitted that there is a difference between, on the one hand, considering the merits of an application to set aside an order dismissing an application for a failure to appear and, on the other hand, determining an application itself. It is true that the former is carried out in the context of the exercise of discretion. The latter involves an application of the law to the facts as found. Further, the order resulting from the former is either dismissal of the application to set aside the original order for dismissal or the setting aside of that order leaving the original application on foot. The order resulting from the latter is the dismissal or upholding of the original application. These matters may indicate that the two decisions do not involve consideration of the merits of the same question which is an essential component of a res judicata; but they are not decisive. The doctrine of res judicata is said to apply to any matter "which it was necessary to decide, and which was actually decided, as the groundwork of the decision itself, though not then directly the point at issue" (Spencer Bower at [184] citing R v Hartington, Middle Quarter Inhabitants [1855] EngR 264 ; (1855) 4 E & B 780 at 794-797; see also Applicant A184 of 2003 at [101] citing Rogers v Legal Services Commission of South Australia (1995) 64 SASR 572). Spencer Bower (also at [184]) identifies this criterion of necessity as involving a "judicial determination of some question of law or issue of fact, in the sense that the decision could not have been legitimately or rationally pronounced by the tribunal without determining the question or issue in a particular way..., such determination, even though not declared on the face of the decision, constitutes an integral part of it: but beyond these limits, there can be no such thing as a res judicata by implication". Did the decision in SZHEW No 2 involve a judicial determination of the requisite character with respect not only to the appellant's application to set aside the order of 25 September 2006 dismissing the application for judicial review of the Tribunal's decision, but also the application for judicial review itself? An assessment of the prospects of success of the judicial review application is a necessary step in the determination of an application to set aside an order for dismissal for a failure to appear. Yet can it be said that such an assessment, in the context of a discretionary decision, involved a judicial determination of an issue such that Scarlett FM's decision in SZHEW No 2 could not have been legitimately or rationally pronounced but for that assessment? It seems to me that the better view is that this question should be answered in the negative. SZHEW No 2 did not involve a judicial determination of the issue whether the Tribunal's decision was affected by jurisdictional error. It involved a judicial determination of whether the order of 25 September 2006 should be set aside. Although assessment of the prospects of success was a necessary part of the determination of the application to set aside the dismissal, there was no judicial determination of the question of jurisdictional error in the sense required. The assessment was part of a broader process of weighing up various factors relevant to the exercise of discretion. The decision could have been rationally and legitimately made without the question of the prospects of success being determined in a particular way, depending on the strength of other factors (such as the appellant's reason for not appearing). It follows from these observations that I do not accept that SZHEW No 2 involved a final decision on the merits of the appellant's cause of action for jurisdictional error by the Tribunal. It involved a final decision as to whether an order dismissing an application for a failure to appear should be set aside. In the course of that decision, Scarlett FM considered whether the application had prospects of success (and reached the view it did not), which contributed to his refusal to exercise a discretionary power in favour of the appellant. But there was no final determination of the cause of action (namely, whether the Tribunal's decision was vitiated by jurisdictional error) in fact or law. For these reasons I consider that the appellant's further application was not precluded by a res judicata. In this regard, I do not accept the Minister's observation, accepted by the Federal Magistrate at [45], that this enables an applicant to bring multiple proceedings about the same decision. First, a final decision on the merits of an application for judicial review ordinarily would give rise to a res judicata. Second, certain cases may give rise to an issue estoppel (properly, not raised by the parties in this case). Third, some cases will be precluded by an Anshun estoppel. Fourth, and as noted below, others may involve an abuse of process. The principles of Anshun estoppel involve asking whether an issue properly belonged to or "was so relevant to the subject matter of the earlier action that it would be unreasonable not to have raised it at that time" ( Wong v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 146 FCR 10; [2004] FCAFC 242 at [37] ). If there had been a final determination on the merits of the appellant's application for judicial review, then it would be difficult to conclude that merely identifying a new ground of judicial review (that is, the inadequate interpretation ground) could avoid an Anshun estoppel. The Federal Magistrate's finding to this effect was warranted on the basis of her characterisation of the decision in SZHEW No 2 as giving rise to a res judicata. Moreover, it may be accepted that, before Scarlett FM and Gilmour J, the appellant could have raised the inadequacy of interpretation as a ground of jurisdictional error upon which he proposed to rely. This would then have been a relevant factor in the application before Scarlett FM to set aside the dismissal order and before Gilmour J on the application for leave to appeal. But the matter the subject of adjudication in the earlier cases was the application to set aside orders for failure to appear. The matter was not the appellant's claim to set aside the Tribunal's decision. As such, I have reached a different conclusion on Anshun estoppel from that reached by the Federal Magistrate. The Minister referred to the decision in MZWKJ v Minister for Immigration and Multicultural Affairs [2006] FCA 761 , in which an Anshun estoppel was found to arise. But that case involved different facts. In that case, the applicants had made an application to the High Court for an order nisi in respect of the Tribunal's decision. The High Court remitted the matter to this Court. Weinberg J refused the application and Finkelstein J then refused an application for leave to appeal (at [3]). The applicants then filed an application for review with the Federal Magistrates Court. The Federal Magistrate found an Anshun estoppel. On appeal Kenny J agreed. The facts of that case are thus analogous to Applicant A321 of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 306 (discussed above) and dissimilar from the present case. In these circumstances I do not accept that the principles necessary for an Anshun estoppel to arise are satisfied. There has never been any judicial decision determining the judicial review application. Given this conclusion, it may not be appropriate for me to attempt to consider the question whether special circumstances displace any Anshun estoppel if I am incorrect. If required to do so, however, I would place significant weight on the fact that the claim of inadequate interpretation has never been the subject of any judicial consideration before this proceeding. Further, the appellant has not had the benefit of legal representation before this proceeding. It is true that lack of legal representation is insufficient of itself to avoid an Anshun estoppel ( MZWKJ v Minister for Immigration and Multicultural Affairs [2006] FCA 761 at [19] ; MZWGJ v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1501 at [11] ). But that is not the only relevant factor in this case. Substantial resources have been necessary to mount the argument including the preparation of the transcript of the hearing before the Tribunal and the obtaining of Ms Qian's evidence. Taking all of these considerations together, I would be prepared to conclude that there are special circumstances in this case. Indeed, if the principle is so broad, it is difficult to understand why the various kinds of estoppel are maintained at all. In our view, near enough to an estoppel is not good enough to establish abuse of process between the same parties without some other element being present. There is the danger that persistent or unattractive litigants with awkward cases might be refused access to the courts if there is a broad and imprecise discretion to stay actions which are somewhat like a previous proceeding. Whether it does depends on the facts of the particular case. The critical words in Miller are "without some other element being present"; in such a case, near enough to an estoppel is not good enough. This does not mean that a party which has failed to establish a res judicata or Anshun estoppel is thereby prevented from pointing to factors which would satisfy the requirements for an abuse of process. For example, if the appellant in this proceeding had done nothing more than sought to re-agitate the same arguments in fact considered by Scarlett FM and Gilmour J then a claim of abuse of process might well be sustainable. In the present case, however, I am satisfied that there is no abuse of process. The claim of jurisdictional error by reason of inadequate interpretation has never been the subject of previous judicial determination. Although the ground could have been raised in the original application and foreshadowed as a ground to be raised in subsequent applications, there are other considerations. Having failed to appear at his hearing, the appellant was not thereafter prosecuting his application for jurisdictional error but, rather, seeking to set aside the dismissal order. The appellant had legal advice but not legal representation until the proceeding before Federal Magistrate Orchiston. Although I agree with the Minister that lack of legal representation is insufficient by itself to avoid an abuse of process, it is a factor that can be taken into account (by analogy to the decisions noted in [33] above). Further, the appellant's claim of inadequate interpretation is supported by evidence and prima facie arguable. It is a claim which has never been considered on its merits other than in the proceeding in SZHEW No 3 from which this appeal is brought. The consequences of the appellant not having a hearing on the merits are serious for the appellant; on his evidence, if he is to return to China he will be subject to ongoing persecution because of his practice of Falun Gong. In these circumstances I do not accept the ground in the Minister's notice of contention to the effect that the Federal Magistrate's dismissal of the further application filed in October 2007 may be sustained because the application involves an abuse of process. It follows that it is necessary to consider the alternative basis upon which the Federal Magistrate dismissed the application, namely, that the appellant had not established any jurisdictional error. In consequence, the decision is a "privative clause decision" and not amenable to judicial review under s 474 of the Migration Act 1958 (Cth). The applications lodged on his behalf for a protection visa and a review of the decision of the Minister's delegate both sought the services of an interpreter in Mandarin. The appellant attended the hearing before the Tribunal on 27 July 2005. Because the appellant had not notified the Tribunal of his intention to attend, an interpreter had not been arranged. The Tribunal delayed the start of the hearing and made arrangements to find an interpreter. The Tribunal found an interpreter in Mandarin. The hearing before the Tribunal proceeded on the basis of interpretation from Mandarin into English and English into Mandarin. The appellant contends that his poor command of Mandarin as well as his Fuqing accent when he spoke Mandarin resulted in the hearing before the Tribunal miscarrying by reason of inadequate interpretation. Failure to provide adequate interpretation services may constitute a breach of the Tribunal's obligation in s 425(1) of the Migration Act to "invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review" and also may amount to a denial of procedural fairness. Not every error or inadequacy in interpretation can be said to have resulted in an appellant being effectively denied the opportunity which s 425 guarantees. Questions of fact and degree are involved. Kenny J (at [45]) held that in order to constitute vitiating error, the departure from the standard of adequate interpretation must "relate to a matter of significance for the applicant's claim or the Tribunal's decision". In deciding whether that had occurred, Kenny J considered "the responsiveness of the interpreted answers to the questions asked, the coherence of those answers, the consistency of one answer with another and the rest of the case sought to be made and, more generally, any evident confusion in exchanges between the Tribunal and the interpreter" (at [41]). Mansfield J adopted a similar approach in Tobasi v Minister for Immigration and Multicultural Affairs (2002) 122 FCR 322 ; [2002] FCA 1050. At [61] his Honour concluded that the evidence did not establish that "the applicant was not invited to give evidence at the hearing, or that his opportunity to give evidence was to any real measure frustrated". The fluency of interpretation, with the advantage of more time to translate, may sometimes present a more cogent expression of the response than that given during a hearing. But in this matter I am far from persuaded that, in substance, the appellant was "prevented from giving his evidence" (per Kenny J in Perera at [38]) because of any incompetence on the part of the interpreter. I do not think that the Tribunal made findings adverse to the applicant by reason of any erroneous interpretation of the applicant's evidence (cf Ismail v Minister for Immigration and Multicultural Affairs (1999) 59 ALD 733). Nor am I persuaded that its adverse view of the applicant's reliability was contributed to by any inadequacies in the interpretation of the applicant's evidence at the hearing (cf Long v Minister for Immigration and Multicultural Affairs [2000] FCA 1172 ; (2000) 106 FCR 183). Gray J also provided a detailed explanation of the national scheme for interpreters, the National Accreditation Authority for Translators and Interpreters Ltd ( NAATI ) and its levels of accreditation (at [23]-[30]). It is apparent from these (and other) decisions in which inadequate interpretation has been claimed that the question whether the inadequacy has been such as to deprive an appellant of the opportunity given by s 425 of the Migration Act involves a qualitative assessment of the conduct of the hearing before the Tribunal as a whole. The appellant and the experts were also each cross-examined. In his affidavit sworn 5 November 2007 the appellant said that he speaks Fuqing but does not read or write in any language. He said he had only a "basic understanding of Mandarin". According to the appellant he became anxious before the hearing because he could not understand the interpreter who spoke Mandarin. She told him not to be nervous and to try to speak very slowly. The appellant said that, because of his very poor Mandarin, he did not understand many of the words the interpreter used or the questions asked. He asked her for clarification when he did not understand and, if he still could not understand, simply guessed. He also often felt the interpreter did not understand what he was saying. He claimed that the interpreter made him repeat answers and asked for clarification many times. Ms Qian is accredited by NAATI as a level 3 interpreter in the Mandarin language and is a lecturer in translation and interpretation at Macquarie University. Ms Qian does not understand Fuqing, which she described as one of the dialects of Fujian. Ms Qian listened to the tape of the hearing before the Tribunal. She concluded that the appellant could understand Mandarin most of the time in his communications with the interpreter but sometimes had difficulty; specifically, when giving short and simple answers he expressed himself adequately in Mandarin but had difficulty when giving longer explanations. He spoke Mandarin with a heavy accent which the interpreter found difficult to understand thus causing confusion. Ms Qian gave five examples of confusion she considered significant. The appellant subsequently used the Mandarin word "juliu" which means "to detain" or "detained". This caused some confusion. In the same context the appellant tended to pronounce words like "which" or "that" with the same tones as if they were interchangeable, randomly used single and plural forms of pronouns, and tended to use meaningless words as fillers. (2) The appellant used two Mandarin words together ("chabuduo" meaning "nearly" and "zuoyou" meaning "about") when only one or the other was necessary. (3) The interpreter did not understand the appellant's use of the word "yinian" meaning "practice in thought". (4) The appellant did not understand the Mandarin word "jianli" ("found") and the interpreter tried again by substituting the word "faqi". (5) The appellant and the interpreter were confused by reason of their accents when dealing with the words "jinqu" ("join in") and "jinhzi" ("ban"). Ms Xie is a NAATI accredited interpreter at level 3 in Mandarin and has worked for 12 years as an interpreter with the Community Relations Commission of New South Wales. Ms Xie recognises many other regional accents including Fujian (Fuqing). Ms Xie listened to the tape of the hearing before the Tribunal. She observed that the appellant spoke with a Fuqing accent. Contrary to the appellant's evidence, Ms Xie noted that he requested the interpreter to repeat something only once and did not hesitate in giving answers. Further, Ms Xie did not hear the interpreter ask the appellant to repeat anything or ask for clarification many times. Ms Xie considered that the appellant spoke adequate Mandarin, using proper words, proper form, and proper sentence construction. In response to Ms Qian's evidence, Ms Xie said that the appellant spoke in accurate Mandarin when giving short and simple answers and could express himself adequately in Mandarin when giving longer explanations. Although he spoke with a Fuqing accent, the interpreter could understand him and when there were difficulties they were resolved through the course of the hearing. Ms Xie considered each of the examples of confusion Ms Qian identified but did not share her concerns. "Kongzhi" and "kongzhu" involved the appellant's pronunciation and was resolved by use of the alternative "juliu". The appellant's meaningless filling words were not interpreted. Otherwise there was no problem apparent from the tape as Ms Qian identified in her first example. "Chabuduo" meaning "nearly" and "zuoyou" meaning "about" can be used together. "Yinian" does not mean "practice in thought" but "mindful", "thought", or "thinking of something" (and thereby was correctly interpreted). The appellant understood "jianli", correctly pronounced it, and the interpretation of his answer was correct. The interpreter pronounced "jinhzi" correctly. This is a very ordinary Chinese word and in common usage. Consistent with authority, the Federal Magistrate accepted that inadequate interpretation could give rise to jurisdictional error (at [60]). Her Honour observed at [65] that, during the hearing before the Tribunal, the appellant never requested a Fuqing interpreter nor complained about the adequacy of the interpretation available. Nor did the appellant raise any such concern in the month in between the hearing and the handing down of the Tribunal's decision. Further, the appellant never raised this issue in SZHEW No 1 , SZHEW No 2 or the earlier appeal to this Court dismissed by Gilmour J. The Federal Magistrate also noted (at [68]) that the application form for review by the Tribunal requested a Mandarin interpreter (although the appellant disavowed involvement in the preparation of the form). Further, the appellant indicated to the Tribunal that he had no objection to the Mandarin interpreter. Applicant: Me? Tribunal: Yes, you. Applicant: No, I don't really have many problems, but sometimes, some of the words I don't understand. Tribunal: Well, why don't you understand some of the words? Applicant: I haven't got much education therefore some words in Mandarin I don't quite understand. Tribunal: Can I ask you then, if you don't understand a word to ask me or Madam Interpreter to explain it to you and to try to use another word. Applicant: Okay. Tribunal: The second question I'd like to ask you about Madam Interpreter is if you have any objections to her whatsoever . Applicant: No objections [emphases added]. The evidence the appellant was giving was not in response to any question from the Tribunal. Hence, and contrary to the appellant's submission, it could not be said that this confusion contributed to the Tribunal's conclusion that the appellant was being evasive (at [79]-[82]). (2) The difference between "chabuduo" meaning "nearly" and "zuoyou" meaning "about" was minor and did not result in any material misunderstanding (at [83]-[85]). (3) The word "yinian" was the subject of evidence from Ms Xie who said it meant "mindful", "thought", "thinking of something", and not "practice in thought" as Ms Qian said. Ms Qian also acknowledged in cross-examination that the word could take this meaning, which was consistent with the meaning attributed to it by the interpreter (at [86]-[89]). (4) The appellant did not ask for clarification of the word "jianli" and had not given evidence of any failure to understand that word. The evidence did not demonstrate any material error in translation or any material misunderstanding between the appellant and the interpreter (at [90]-[93]). (5) There was an initial misunderstanding about the words "jinqu" ("join in") and "jinhzi" ("ban") but the appellant eventually understood the Tribunal's question and gave a responsive answer (at [94]-[96]). The interpreter did not translate the word, thereby leaving the Tribunal with the impression that the appellant identified "Yi Nian" as the name of the main Falun Gong text. Ms Xie agreed that she would have translated this word into English whilst noting the word was unclear as to its meaning in this context. Ms Xie thought she would have said "yinian" and then stated her belief that the intended meaning was "thinking". The interpreter did not do this and the Tribunal was left with the impression that the appellant thought this was the name of the text. The Federal Magistrate accepted the Minister's submission that there was no evidence that the appellant misunderstood the question about the main Falun Gong text and hence no prejudice was caused by the interpreter not translating "yinian" as "thinking". The appellant's answer to the Tribunal's question was simply incorrect (at [98]-[99]). (2) At the start of the hearing the interpreter failed to translate "lushi" into English. "Lushi" means "lawyer" in the Fuqing dialect but the interpreter referred to "Ms Lu Shi". Interpreter: The letter was still with Lu Shi and I haven't got the letter. They didn't give me the letter. Tribunal: So how did you know to come here today, if you did not have the letter? Interpreter: They just tell me about the hearing. Tribunal: Who is "they"[? Tribunal: Who is Lu Shi? I don't know you are talking about. Interpreter: Lu Shi is the person who helped me to apply. The Tribunal did not refer to this matter in its "Findings and Reasons" and no findings of fact depended on it (at [100]-[102]). (3) There were various communication difficulties concerning the appellant's evidence before the Tribunal that he had been detained in China between May and October 2002 in circumstances where no such claim appeared in the appellant's protection visa application. The Federal Magistrate concluded that the only difficulty disclosed by the transcript was the appellant repeatedly failing to answer the Tribunal's question. The Federal Magistrate also accepted the Minister's submission that Ms Qian had not suggested any interpretation difficulty with respect to these exchanges (at [103]-[105]). (4) The interpreter made comments during the hearing before the Tribunal about the appellant not speaking clearly. The Federal Magistrate accepted Ms Xie's evidence that the appellant spoke in accurate Mandarin when giving short and simple answers and could express himself adequately in Mandarin when giving longer explanations. Further, that the interpreter understood the appellant despite his Fuqing accent and difficulties caused thereby were resolved during the course of the hearing before the Tribunal (at [106]-[114]). The Federal Magistrate considered that the appellant's evidence disclosed that he could understand and speak at least some Mandarin, which undermined his evidence that his Mandarin was "very poor" (at [116]-[117]). The Federal Magistrate considered that the appellant's evidence disclosed the appellant's attempts to distance himself from his capacity to speak Mandarin (at [119]-[123]). In consequence, the Federal Magistrate found the appellant not to be a credible or reliable witness and concluded that his claims of lack of knowledge of his protection visa application and inadequate interpreting services being provided by the Tribunal were fabricated (at [124]). The Federal Magistrate also noted that the Migration Act imposed no requirement on interpreters to have NAATI accreditation (at [125]). In any event, her Honour accepted that "each example should be considered in its particular context and in light of the evidence as a whole". The Federal Magistrate (at [135]-[138] and [140]-[141]) also rejected the appellant's submission (put in various ways) that the evidence as a whole disclosed that the interpretation errors contributed to the impression the Tribunal formed of the appellant as evasive or, at the least, that this possibility could not be excluded even where the difficulties had been resolved during the course of the hearing. Accordingly, the Federal Magistrate concluded that there was no breach of s 425 of the Migration Act or denial of procedural fairness to the appellant on the basis of inadequate interpretation (at [143]-[144]). I deal with each ground in the order presented in the appellant's written submissions. This contention appears to relate to the Federal Magistrate's findings that the Tribunal acted properly (at [68]) and that it was difficult to imagine how the Tribunal might have conducted itself differently in the circumstances (at [73]). The problem with this contention is that the relevant test is not whether the Tribunal should or should not have realised something. It is whether, in fact, the obligation imposed by s 425 of the Migration Act was contravened by reason of any inadequacy in the interpretation provided. It is thus difficult to see how this contention can stand separately from the appellant's substantive allegation that inadequate interpretation effectively deprived the appellant of the opportunity to give evidence or materially contributed to conclusions of the Tribunal adverse to the appellant. The appellant's wide-ranging submissions in support of this contention disclose this difficulty. Insofar as this ground might be capable of independent consideration, I do not accept it. I agree with the Federal Magistrate's analysis of the submissions put by the appellant about this issue. The Tribunal asked the appellant whether he had any difficulty in understanding the interpreter and whether he had any objection to the interpreter "whatsoever". The appellant said he did not. The appellant's other answers were not such as to put the Tribunal on notice of the facts asserted by the appellant (that Mandarin was not the appellant's native tongue and that he could not make himself understood through the interpreter provided). To the contrary, the answers indicated that the appellant had no real problem in communicating with the interpreter except for some words which he did not understand due to his lack of education. The appellant's focus on the words "in Mandarin" as the basis for this contention is unjustified for the reasons the Federal Magistrate gave (at [70]-[73]). The words have to be considered in context. As the Federal Magistrate found, the context indicates that the appellant was informing the Tribunal that he did not really have many problems with the words but did not have much education and thus could not understand some words in Mandarin. It would be unreasonable and contrary to the appellant's own evidence to expect the Tribunal to take from that exchange an understanding of the facts asserted by the appellant. It must be recognised (as the Federal Magistrate did at [65]) that the appellant made no objections to the interpretation provided and raised no concern with the Tribunal in that respect. The Tribunal, moreover, invited the appellant to seek clarification of any word he did not understand and specifically sought to elicit from the appellant any objections he might have about the interpreter "whatsoever". The appellant said he had no objections. The hearing then proceeded. As discussed in more detail below, nothing occurred in the course of the hearing which ought to have caused the Tribunal to recognise the facts now asserted by the appellant. The appellant sought to rely on three interjections by the interpreter to support ground 9 in the notice of appeal. (2) "Excuse me Ma'am but I don't think he can understand the Mandarin word 'practice'" and related discussion between the Tribunal and interpreter. (3) "He didn't say it very clearly though". These examples have to be considered in context. In terms of the overall hearing as evidenced by the transcript, these are isolated instances of relatively minor difficulties in communication arising either from the appellant's words or the Tribunal's words. The first cause for interjection was resolved. The second appears to have involved a conceptual difficulty about the difference between "practice" and "thought" but did not prevent the appellant from telling the Tribunal what he wanted about his involvement with Falun Gong. The third appears to have been the interpreter advising the Tribunal that she had done her best to interpret a rather confusing statement by the appellant. Contrary to the appellant's submission, the unfairness of the hearing is not apparent from reading the transcript. Read as a whole, the transcript suggests that the appellant and the Tribunal generally communicated effectively. The examples of difficulty apparent from the face of the transcript are isolated. Many parts of the transcript show no difficulty at all in the communications between the appellant and Tribunal. Other discontinuities in the transcript, where apparent, seem to arise from either the common habit of people to interject or talk over the top of one another, or the appellant's eagerness to assert his status as a refugee and tell his story to the Tribunal in his own way, irrespective of the Tribunal's questions. The Tribunal's adverse findings about the appellant's evasiveness arose after the appellant failed to answer the Tribunal's questions about his reason for not mentioning his detention in his application documents. No difficulty in interpretation is apparent in the transcript from that exchange. Applying the approach in Perera at [41] (that is, to have regard to "the responsiveness of the interpreted answers to the questions asked, the coherence of those answers, the consistency of one answer with another and the rest of the case sought to be made and, more generally, any evident confusion in exchanges between the Tribunal and the interpreter"), I do not accept that the Tribunal should have realised that Mandarin was not the appellant's native tongue and that he could not make himself understood through the interpreter provided. As to the first alleged error, the appellant submitted that the Federal Magistrate placed "undue emphasis" on the Tribunal being blameless in providing a Mandarin interpreter because the appellant had previously not indicated he required a Fuqing interpreter. The appellant said this was an irrelevant consideration under the Migration Act . The appellant's assertion of irrelevance of the Tribunal's culpability is difficult to reconcile with ground 9 discussed above. In any event, I do not accept the submission. The Federal Magistrate did not unduly emphasise the culpability or otherwise of the Tribunal. The Federal Magistrate applied principles consistent with authority, as apparent from her Honour's reasons in [61], [113], [114], [127]-[130], [133], [136] and [142]-[144]. Her Honour's observations about the course of conduct of the appellant and the Tribunal are relevant to an assessment of facts informing the application of principle to the particular case. For example, a finding of fact that an applicant could not understand Mandarin might be more readily made if the applicant made a complaint to that effect at the time which the Tribunal disregarded. As to the second alleged error, the Federal Magistrate did not say that the appellant had a positive obligation to request a Fuqing interpreter in [62] and [65] of the reasons or elsewhere. These paragraphs contain observations relevant to an assessment of a fact in issue, namely, the capacity of the appellant to understand and speak Mandarin. Again, and for example, if an applicant requests a Fuqing interpreter yet is provided with a Mandarin interpreter that fact might support an inference that the appellant could not adequately understand Mandarin. Equally, a lack of any such request is potentially relevant to the same process of inference drawing. No error as alleged by the appellant is disclosed in the Federal Magistrate's decision. As to the third alleged error, the Federal Magistrate did not say that the appellant had a positive obligation to inform the Tribunal that Mandarin was not his native tongue either at [62] and [71] of the reasons or elsewhere. The observation in [62] merely records the undisputed facts that the appellant's application for review by the Tribunal requested a Mandarin interpreter and the appellant never requested a Fuqing interpreter. The comments in [71] need to be read in context. The Federal Magistrate in that paragraph is dealing with the submission that the Tribunal should have gleaned that Mandarin was not the appellant's native tongue by his statement that "I haven't got much education therefore some words in Mandarin I don't quite understand". The Federal Magistrate rejected that submission (correctly in my view). In the course of so doing, her Honour observed that it was not for the Tribunal to infer this asserted fact from the words "in Mandarin" but for the appellant so to inform the Tribunal. There is nothing inappropriate about that observation read in context. As to the fourth alleged error, the Federal Magistrate did not say that the appellant had any obligation to lodge a complaint about the interpreting services provided within one month of the Tribunal hearing. The observation in [65] also has to be read in context. The Federal Magistrate is recording the fact that the appellant did not make any complaint about the interpretation provided in the one month period between the hearing and the handing down of the Tribunal's decision or, indeed, any such complaint at any time until this proceeding. These facts are relevant because they are capable of bearing upon the question whether the appellant's Mandarin was so poor that the provision of a Mandarin interpreter meant he was effectively denied the opportunity of a hearing as guaranteed by s 425. As to the fifth alleged error, the Federal Magistrate provided reasons for rejecting the appellant's claim that he could not make himself understood by the Tribunal through the interpreter provided. The transcript of the hearing, read fairly and as a whole, demonstrates to the contrary of the appellant's claim and the Federal Magistrate was correct to reject it. The submissions in the appeal sought to support this proposition in a number of ways. Insofar as the appellant relied on the terms of the transcript as a whole, I have rejected that submission above. Insofar as the appellant relied on the specific errors identified by Ms Qian and in the appellant's submissions, I discern no error in the Federal Magistrate's consideration of each example. The findings made were open on the evidence. A realistic assessment supports the Federal Magistrate's conclusions. The confusion over "lushi" went nowhere and may be properly inferred to have played no part in the Tribunal's reasoning process. The "control" and "detain" confusion was short-lived. The "nearly" and "about" issue is trivial; redundancy and repetition are common features of all communication. The "practice" and "thought" issue was drawn to the Tribunal's attention. It was also open to the Federal Magistrate to accept Ms Xie's evidence that "yinian" means thought or thinking, consistent with the interpretation which was provided to the Tribunal. In any event, this issue did not prevent the appellant from giving his evidence about his relationship with Falun Gong. The problem with "Yi Nian" as the name of a book does not alter the fact that the appellant could not answer the Tribunal's question about the main Falun Gong text. It was for the Tribunal to accord to this answer the weight it thought fit, given the appellant's known illiteracy. The issue about "found" was resolved. That about "join" and "ban" was also clear to the Tribunal. Insofar as the appellant said that the Federal Magistrate erred by considering the examples of error in isolation rather than the evidence as a whole, I do not agree. It was necessary for the Federal Magistrate to assess each of the examples of inadequate interpretation on which the appellant relied. The Federal Magistrate did not, thereby, err by unjustifiably "segregating and analysing in isolation" each example. The Federal Magistrate did consider the evidence as a whole as the observations in [127] and [134]-[136] disclose. Moreover, the appellant submitted to the Federal Magistrate that the whole of the evidence supported a finding of jurisdictional error. As part of this claim, the appellant said that the evidence showed that the Tribunal had built an impression of the appellant being evasive in circumstances where the inadequacies of interpretation had contributed to this impression. The Federal Magistrate considered and rejected this claim (at [135]-[143]). In these circumstances, it cannot be said that the Federal Magistrate failed to consider the whole of the evidence or wrongly considered each example of alleged error in isolation. The Federal Magistrate considered the whole of the evidence but reached a different conclusion from that advocated by the appellant. That does not support any finding of error by the Federal Magistrate. Insofar as the appellant relied on the lack of NAATI accreditation by the interpreter before the Tribunal, I agree with the reasoning of the Federal Magistrate rejecting this submission in [125]. Lack of accreditation, whether in isolation or considered with every other claim made by the appellant, is insufficient to found jurisdictional error in the circumstances of this case. Cases of jurisdictional error based on inadequate interpretation inevitably involve questions of fact and degree. The lack of NAATI accreditation may bear upon the drawing of inferences about the adequacy of the interpretation. But neither the lack nor the holding of NAATI accreditation provides a necessary answer to the question as to whether a hearing miscarried by reason of inadequate interpretation. The appellant also said that the Federal Magistrate erred by confusing the ability and performance of the interpreter to interpret Mandarin with the applicant's ability to understand Mandarin. The Federal Magistrate's reasons do not support the attribution of this error. Further, it is not the case, as the appellant appeared to suggest, that the obligation in s 425 may only be satisfied by providing an interpreter who is capable of speaking an applicant's "mother tongue". Hence, even if the appellant's "mother tongue" is Fuqing the provision of an interpreter of Mandarin does not involve any necessary contravention of s 425. The issues remain those identified in the authorities discussed above. Accordingly, I reject the submission that the Tribunal had an obligation to provide the appellant with a Fuqing interpreter merely because he was a native of Fujian and spoke Fuqing. In this case, the appellant also spoke Mandarin. He requested a Mandarin interpreter in both applications. When asked, he said he had no objection to the interpreter provided. Nothing in s 427(7) of the Migration Act , or the authorities on which the appellant relied, supports a conclusion that the Tribunal had to provide the appellant with a Fuqing interpreter in order to discharge its statutory obligations. Insofar as this ground depends on the treatment of the expert evidence and other errors which the appellant alleged but which do not relate specifically to any appeal ground, I deal with both below. The appellant submitted as part of this ground that the Federal Magistrate ought to have accepted Ms Qian's evidence both generally and as to the specific examples she identified. The expert evidence of Ms Qian, however, did not stand alone. The Federal Magistrate had the benefit of Ms Xie's evidence as well. The appellant's submission that the Federal Magistrate should have preferred the evidence of Ms Qian to that of Ms Xie failed to identify any error in the Federal Magistrate's weighing up of the expert opinions. The fact that Ms Xie did not know that the appellant was illiterate and had little formal education does not undermine her principal conclusions based on listening to the tape of the hearing before the Tribunal. The appellant said that Ms Xie's opinions were affected by her unwarranted assumptions about Chinese government policy and exposure of the appellant to formal education and thus had to be discounted. But Ms Xie's opinions based on listening to the tape of the hearing were clear. Ms Xie, equally clearly, held an opinion that Fuqing was a dialect and not a language and the existence of many dialects in China had prompted a policy of strong promotion of the use of Mandarin throughout China (noting, as her affidavit disclosed, that she had lived in China for about 21 years). I can see no basis for the appellant's submission that Ms Xie's evidence was inherently entitled to less weight than that of Ms Qian for these reasons. Nor can I see any error in the Federal Magistrate's treatment of the expert evidence. Similarly, the complaint about Ms Xie not being an academic specialising in translation and interpretation (as Ms Qian is) is difficult to comprehend. Ms Xie is a level 3 accredited interpreter. Unlike Ms Qian, Ms Xie can understand Fuqing. Ms Xie has worked as an interpreter for the Community Relations Commission of New South Wales for 12 years. Ms Xie's experience gave her specialised knowledge (of Mandarin and Fuqing) and thus enabled her to give opinions about the adequacy of the interpretation evident from the hearing tape in accordance with s 79 of the Evidence Act 1995 (Cth). The appellant submitted further in this context that the Federal Magistrate misunderstood the case by finding at [112] and [113] that the applicant could speak accurate Mandarin when giving short answers and adequate Mandarin when giving longer explanations, consistent with Ms Xie's evidence. This is because, according to the appellant, the only relevant issue is whether communication and comprehension problems existed between the appellant and the interpreter such as to render the hearing meaningless. The appellant's contention was that the Federal Magistrate somehow asked the wrong question by focusing on Ms Xie's capacity to understand the tape of the hearing after repeated listening. The contention is unfounded. Ms Xie listened to the tape (as did Ms Qian) for the purpose of ascertaining whether the appellant and the Tribunal could communicate with each other via the interpreter, thereby addressing the very issue the appellant said was relevant. The appellant's submission thus attributes a misunderstanding to the Federal Magistrate when the reasons disclose no such misunderstanding. Ms Xie was not giving evidence about her own ability to understand the appellant on repeatedly listening to the tape (and nor was Ms Qian). Ms Xie (and Ms Qian) listened to the tape to enable opinions to be given about the adequacy of the communications between the appellant and the interpreter in Mandarin. As her evidence discloses, Ms Xie analysed the appellant's capacity to use words and form sentences in Mandarin. She analysed the degree to which the appellant's accent might have affected his pronunciation of words in Mandarin. She assessed whether there was evidence of confusion by reason of the appellant or interpreter asking for things to be repeated or asking for clarification or other hesitation in the flow of the communications. She analysed whether the interpreter gave an accurate interpretation of what the appellant and the Tribunal had said. All of those matters bear upon the question whether the hearing miscarried by reason of inadequate interpretation, as the discussion in Perera at [41] confirms. The Federal Magistrate did not misunderstand the issue requiring determination. Further, and contrary to the appellant's submission, an interpreter can give meaningful expert evidence about the apparent capacity of a person to comprehend a language. In one sense it is always the case that one person can never know the true level of comprehension of another whether they are communicating in the same language or through an interpreter. But that fact does not prevent an interpreter from analysing a person's questions and answers in a language and from that analysis providing a cogent opinion about that person's apparent capacity to communicate in, and thus comprehend, that language. If the communications were in English a court could undertake this task itself from the transcript and, if available, the tape of the hearing. But where the communications are in a foreign language, as here, the assistance of experts with specialised knowledge of the language to address this issue is necessary and appropriate. The appellant criticised the Federal Magistrate's statement in [112] that she accepted the evidence of Ms Xie over that of Ms Qian in respect of any differences between them as an impermissible bare assertion without any supporting analysis. The criticism is unfounded. The paragraph is the culmination of the whole of the analysis from [58] onwards. This is not a case in which the Federal Magistrate simply stated a preference for one expert over another without any reasoned analysis in support. None of the expert evidence supported the appellant's claims of very poor Mandarin. Ms Qian said the appellant seemed to understand Mandarin "most of the time", with his difficulty limited to the giving of longer explanations and the difficulty of the interpreter limited to the appellant's accent. Ms Qian gave specific examples said to establish these difficulties. Ms Xie considered the appellant's Mandarin accurate for shorter sentences and adequate for longer explanations and that there was no evidence of the interpreter not understanding the appellant's accent. The Federal Magistrate only accepted Ms Xie after discussing, in considerable detail, the reasons for not accepting Ms Qian's evidence. No error is thereby disclosed. The paragraphs of the reasons said to give rise to this error are [115]-[118]. Those paragraphs do not support the submission. The transcript references provided (9 September 2008 at 9-17) are to questions asked of the appellant about the evidence he gave on 28 May 2008 that, when in China, he spoke through his wife to people who used a different dialect or Mandarin. The cross-examination primarily concerned the appellant's ability, at that time, to speak to people (such as his neighbours in Sanming City) in Mandarin. Those questions which involved the appellant's present capacity to speak Mandarin were clear (for example, see p 14 of the transcript of 9 September 2008). The Federal Magistrate specifically requested that the cross-examiner ensure she clarified whether the questions related to the appellant's present or past ability to speak Mandarin (9 September 2008 at 14.15-25). The observations in [115]-[118] do not indicate that the Federal Magistrate erroneously relied on the appellant's present capacity to speak Mandarin to found her conclusions. The Federal Magistrate's reasons disclose a focus on the appellant's capacities at the time of the hearing before the Tribunal. In any event, I am not persuaded that any such error as alleged, if it had occurred, would be sufficient to vitiate the Federal Magistrate's decision. Nor am I satisfied that the Federal Magistrate used the appellant's present ability to speak Mandarin as a basis for the adverse credit findings. The Federal Magistrate's adverse credit findings were based on a range of other considerations including: - (i) the inconsistency between the appellant confirming to the Tribunal that his application was true and correct and subsequent evidence that he had no involvement in the preparation of the application (at [119]), (ii) the inconsistency between the appellant's claims to have personally recruited people to join Falun Gong and subsequent evidence of only communicating with others, including his Falun Gong friends, in Mandarin through his wife (at [120]-[122]), and (iii) the inconsistency of the appellant's claim to have a very poor command of Mandarin and the transcript of the hearing before the Tribunal which discloses the appellant communicating in Mandarin through the interpreter (at [123]). The Federal Magistrate does not refer to the appellant's present capacity to speak Mandarin in these findings. Her Honour's conclusion in [124] about the appellant's credibility specifically refers to the appellant's capacities "when he gave evidence before the Tribunal". The appellant made a separate submission that the finding in [124] (that the appellant fabricated his claims of lack of knowledge of the content of his applications for a protection visa and before the Tribunal, as well as his claim of inadequate interpretation) was not open because the allegation of fabrication had never been put to the appellant. There are several difficulties with this submission. The notice of appeal did not identify this issue as a ground on which the Federal Magistrate's decision was to be impugned. The appeal book did not include the transcript of submissions before the Federal Magistrate so it is not possible to know whether the Minister invited the making of this finding or not. At the least, the quote from the Minister's submissions in [123] of the Federal Magistrate's reasons indicates that the appellant's claim of very poor Mandarin, and thus the very essence of his case, was subject to direct challenge in closing submissions. If the Minister's closing submissions breached the rule in Browne v Dunn (1893) 6 R 67 about matters that must be put to a witness in cross-examination based on considerations of fairness then the issue should have been raised with the Federal Magistrate. In any event, the Federal Magistrate accepted the evidence of Ms Xie that the interpretation before the Tribunal was adequate (at [114]) without any consideration of the appellant's evidence or credit. This is consistent with the fact that the Federal Magistrate had the benefit of the transcript of the hearing before the Tribunal and the expert evidence about the course of that hearing. It is also consistent with the way in which the Federal Magistrate expressed her essential conclusions in [128] and [129] dealing first with the question of the adequacy of the interpretation provided and thereafter with the appellant's credibility. More specifically, the Tribunal itself had made an adverse credit finding on the basis of inconsistency between the application for review and the appellant's oral evidence. Further, there is an obvious credit issue for a person who requests a Mandarin interpreter in their applications yet later claims inadequate interpretation due to their poor Mandarin. The appellant's affidavit of 5 November 2007, in asserting no involvement with the preparation of the applications, was clearly intended to address the inconsistency. But the evidence in the affidavit was just as clearly inconsistent with the evidence the appellant gave to the Tribunal that his signature appeared on the protection visa application and the content of the application was true and correct. The Federal Magistrate did not have to accept the appellant's explanations even if they were not challenged in cross-examination; the inconsistencies were manifest on the evidence as a whole. The fundamental premise of the appellant's case before the Federal Magistrate was that his Mandarin was so poor that the provision of a Mandarin interpreter effectively deprived him of the opportunity to be heard by the Tribunal. It was obvious that the appellant's capacity to understand Mandarin at the time of the Tribunal hearing was the main dispute between the parties. That is what the expert evidence from each party addressed. It is what the appellant addressed in his affidavit. It was put to the appellant (in a variety of ways) in cross-examination that he could speak adequate Mandarin when giving evidence before the Tribunal. It was also put to him that he had never raised with the Tribunal any concern about the interpretation provided. In other words, it was being put to him that he in fact had no concern at the relevant time. The finding in [124] of the Federal Magistrate's reasons is the culmination of a series of observations about issues undermining the appellant's credibility starting at [119]. In [119]-[122] the Federal Magistrate gave reasons for characterising the appellant's evidence as having sought to distance himself from: (i) his applications (requesting a Mandarin interpreter), (ii) his use of Mandarin in his everyday life in China where he asserted that he spoke through his wife compared to the claims in his application for a protection visa in which he said he had recruited more than 30 people to join Falun Gong, and (iii) his use of Mandarin as part of the running of his tyre repair business. In these circumstances the appellant's credibility was plainly in issue. The issue was whether the appellant's Mandarin at the time of the hearing before the Tribunal was as poor as he claimed in order to support his allegation of the provision of inadequate interpretation. It is true that the Federal Magistrate did not need to make the specific finding of fabrication in order to find against the appellant. Further, and as the High Court said in Smith v New South Wales Bar Association (No 2) [1992] HCA 36 ; (1992) 176 CLR 256 at 268, there "is a difference between the rejection of a person's evidence and a finding that he or she deliberately lied". But in the circumstances of this case an obvious corollary of not accepting the appellant's evidence was the conclusion that his claims of having such poor Mandarin were untrue (or, in the Federal Magistrate's words at [124], "fabricated to support his second application to this Court"). It is true that the appellant said in an earlier hearing in November 2006 ( SZHEW No 2 ) that he spoke very little Mandarin (at [15]). But he did so in the context of more general complaints about his lack of English, his illiteracy and lack of education. Importantly, he did not say the interpretation provided was inadequate. The appellant did not say so despite having requested a Fuqing interpreter for the hearing in November 2006. By the time of the hearing in SZHEW No 2 the appellant thus must have known that such interpreters were available. Similarly, in 2007 in SZHEW v Minister for Immigration and Citizenship [2007] FCA 243 (before Gilmour J) the appellant's grounds of appeal did not suggest that he had received inadequate interpretation services during the hearing before the Tribunal. The fact that the appellant mentioned his poor Mandarin during the November 2006 hearing does not undermine the Federal Magistrate's findings that his claims of lack of involvement with the preparation of his applications for a protection visa and inadequate interpretation before the Tribunal were fabrications. For these reasons, and contrary to the appellant's submissions, the Federal Magistrate's finding that the appellant's claims in this regard were fabricated was not affected by a mistake of fact so as to give rise to error (cf Smith v New South Wales Bar Association (No 2) at 273). The appellant said that, given the evidence of his lack of comprehension of Mandarin, this constituted an error by the Federal Magistrate. The submission cannot be sustained. The appellant did confirm to the Tribunal that the application was true and correct. He did not indicate any difficulty in understanding the question at the time. He had no trouble in communicating a negative answer when he wished to, as the transcript of the hearing before the Tribunal discloses. The Federal Magistrate preferred Ms Xie's evidence about the appellant's proficiency in Mandarin to that of Ms Qian. Her Honour rejected the appellant's evidence about his capacity to communicate in Mandarin as lacking credibility. These findings were open on the evidence. Accordingly, the Federal Magistrate was entitled to have regard to the obvious inconsistency between the request for an interpreter in Mandarin on the application forms and the appellant's subsequent claims. The Federal Magistrate was also entitled to consider the inconsistency between the appellant's confirmation to the Tribunal that the content of his protection visa application was true and correct and his subsequent disavowal of involvement in the preparation of the applications, as well as the adequacy of his explanation that he had not prepared the application documents. I deal with those further submissions below. The appellant referred to the incapacity to exclude a possibility that an inadequacy of interpretation contributed in some way to the Tribunal having formed an adverse impression of the appellant. But lack of capacity to exclude a mere possibility is insufficient. There are countless possibilities that may not be able to be excluded by any process of rational inference from available evidence. That does not establish jurisdictional error. It was a matter for the appellant to establish, on the whole of the evidence, contravention of s 425 of the Migration Act by reason of inadequate interpretation. The appellant's submission that the Federal Magistrate (at [92]) effectively reversed the onus by requiring a complaint from the appellant at the time to support any allegation of inadequate interpretation should not be accepted. The appellant's reliance on the statement in M175 of 2002 at [56] ("A person who requires the services of an interpreter in order to give evidence can hardly be expected to know that the interpreter has failed to translate the evidence correctly") in this regard is misplaced. In M175 of 2002 there were significant errors in the interpretation from Sinhalese into English. As the applicant did not speak English, he could not be expected to have complained about these errors. This is the reason for Gray J's observation at [56]. In the present case, by contrast, the appellant claimed to have poor Mandarin. He was provided with a Mandarin interpreter and thus had to speak Mandarin during the Tribunal hearing. In this different context, the lack of any complaint by the appellant is a relevant factor to the assessment of the facts in issue (namely, the appellant's proficiency in Mandarin). Accordingly, there was no impermissible reversal of any onus of proof by the Federal Magistrate. Nor did the Federal Magistrate impermissibly impose any unreasonable requirement for a complaint to be made at the time of the hearing before the Tribunal. As noted above, the lack of complaint was relevant to a fact in issue, being the appellant's capacity to speak and understand Mandarin. The appellant's complaint about the Federal Magistrate's acceptance (at [123]) of a submission comparing the present case to SZKBL v Minister for Immigration and Citizenship [2008] FCA 1064 is also unsustainable. It is true that each case asserting inadequate interpretation must be considered on its own facts. The point that the Federal Magistrate was making in [123] about similarities to SZKBL is not inconsistent with this proposition. In the present case, as in SZKBL , the appellant did not make any complaint to the Tribunal about the interpretation service provided. Similarly, the appellant in each case was given an opportunity to tell the Tribunal anything he wished before the end of the hearing and accepted that opportunity. Further, as in SZKBL , the tenor of some of the Tribunal's interactions with the appellant is capable of giving rise to some initial concerns. Those initial concerns have to be assessed against the context of the transcript as a whole and the fact that, from a transcript, it is not possible to assess the tone of any interaction. A statement which is capable of appearing peremptory on paper may not have been in the context of the actual discussion then occurring. Further, in the present case, the Tribunal attempted to assist the appellant by inviting him to seek explanations if necessary. The appellant agreed to do so. The appellant was capable of asserting his status as a refugee and giving clear details about his detention. Yet his answers to the Tribunal's questions about the preparation of his application documents and the lack of any reference to detention therein were unresponsive. His answers to questions seeking details of his practice of Falun Gong were vague. For the reasons already given, I do not accept that these matters resulted from, or were materially contributed to, by interpretation difficulties. The focus in oral submissions on the appellant's illiteracy also does not found any jurisdictional error. The appellant told the Tribunal that he had little education and could not read. The Tribunal recognised the appellant's illiteracy at p 6 of its reasons. The weight to give to that factor in the assessment of the credibility of the appellant's evidence was a matter for the Tribunal, as the Federal Magistrate correctly found (at [138]). For this reason the appeal must be dismissed. The usual order as to costs should be made. | alleged inadequacy of interpretation of hearing before the tribunal whether interpretation gave rise to a breach of s 425 migration act 1958 (cth) and procedural unfairness circumstances of the case whether federal magistrate's treatment of expert evidence on standard of interpretation was in error whether federal magistrate's findings with respect to appellant's credibility in error whether judgment in first respondent's favour following appellant's failure to appear gave rise to a res judicata whether judgment determining whether application should be re-instated gave rise to a res judicata principles to be applied in determining whether a res judicata arises whether final determination of the merits of the case so as to give rise to a res judicata whether prior proceedings gave rise to anshun estoppel whether further application an abuse of process migration estoppel |
2 The nature of the ACCC's allegations is that the second respondent, Mr Hilder, used the first respondent, the Original Mama's Pizza and Ribs Pty Ltd ('the company'), and the services of the third respondent, Mr Soo, as a vehicle and means of selling pizza oven systems to various people who wished to use the pizza oven systems in food outlets. The ACCC asserts that in five cases various false and misleading representations were made, a number of them being common. 3 The system allegedly employed was to arrange the lease by food outlet operators of the oven systems, apparently for a period of 60 months. One allegation is that it was actually represented to the operators that the terms of the lease would be six months rather than 60. Another allegation is that it was represented to the operators that, if they were not satisfied with the purchase at the end of six or 12 months, the company would buy back or receive back the oven system. These representations were coupled with an alleged system whereby the company would pay the first six months lease instalments. 4 One can see that there might well be very lively issues of fact particularly about whether any supplier of any equipment would arrange a mere six months lease, pay the lease payments and undertake to receive the equipment back at the end of that six months if the party acquiring the equipment was not happy with it. There may, I do not know, be more apparent substance in the claim that there would be an automatic right of return after six months of a 60 month lease. At all events, the ACCC's case is that the representations made were false and misleading. 5 The ACCC seeks a variety of relief, including relief of kinds not available to the individuals concerned. Broadly expressed, injunctive relief is sought. Non-punitive relief, directed to ensuring that all those who may have dealt with the respondents are made fully aware of their own possible remedies under the Trade Practices Act 1974 (Cth) ('TPA'), is also sought. 6 In three of the five cases there has been litigation involving at least the company, and in one of those cases, Mr Hilder, the second respondent, and Mr Soo, the third respondent. In general, these cases have arisen, as I understand it, in circumstances where a finance company, as lessor of the ovens, has sought to enforce its rights under the leases and the operators have joined the respondents by way of cross-claim. Strangely, it does not seem that any of the cases involve causes of action relying on the TPA. The remedies the operators seek, so I am informed, are for breach of contract. 7 It is true that there may well be some double investigation of some factual issues but, from what I have said, it seems clear that the factual scope of the inquiry necessitated by the ACCC's action in this Court would require the investigation of a wider range of facts, and in rather different legal contexts, from those in any or all of the other litigation. It is also clear that, at least in part, the facts sought to be agitated here as to two transactions have not been the subject of any other litigation. 8 Important questions of ascertaining aspects of the public interest that may be engaged by what has occurred, and vindicating it if the ACCC's contentions are made out in whole or in part, would arise here and would not arise in what I will call the private litigation. 9 It is not disputed that the Court has power to grant a stay, either by way of preventing an abuse of the Court's process (which I think is not actually asserted), and also by way of ensuring that there is no procedural unfairness to the parties by way of the Court controlling its own processes so as to ensure a fair and orderly presentation of the litigation. 10 Mr Ramrakha, solicitor for the respondents, stresses that there are live factual issues and that no assumptions should be made about the truth or otherwise of the ACCC's assertions. Of course that is correct. Mr Ramrakha points out that there would be some duplication with the investigation of some factual issues, as I have mentioned. The company is no longer in business, and it has given an assurance that it is not selling pizza oven systems. Mr Hilder is not selling pizza oven systems following an indication from the ACCC that it would maintain a very lively interest in his activities if he sought to do so. Mr Ramrakha also submitted that the events complained of occurred a long time ago, and that the applicants have delayed bringing the proceedings. Finally, Mr Ramrakha submitted that, although the ACCC exercised its powers to interview Mr Hilder, and also had the opportunity to speak to Mr Soo, and some generalised allegations were put to them, they were not asked about the allegations in the particular cases now brought to the Court. 11 There was no requirement that the allegations should have been put to them before the proceedings were commenced. Despite the long time that has occurred, the ACCC has not been shown to have sat on its hands. The process of investigation has apparently been lengthy, even if not pursued as a matter of electric urgency, but no doubt the resources of the ACCC are not unlimited. 12 The undertakings that have been given, and the events in relation to the company, which has gone into liquidation, fall a long way short of meeting all the requests for relief made by the ACCC in these proceedings, so that there is no element of oppression in the ACCC seeking broader relief than that degree of amelioration which, without admissions, may have voluntarily been engaged in by any of the respondents. 13 Further, the degree of duplication is not, in my view, such as to warrant a stay. 14 The relevant power of the Court to control its own proceedings has been considered in Hughes Motor Service Pty Ltd v Wang Computer Pty Ltd (1978) 35 FLR 346 (' Wang ') at 351 to 354, and Sterling Pharmaceuticals Pty Ltd v The Boots Company (Australia) Pty Ltd (1992) 34 FCR 287 (' Sterling Pharmaceuticals '). As McClelland CJ in Equity said in Tamas v Silver Beach Resort Pty Ltd (unreported, NSWSC, 13 July 1994): 'a party bringing proceedings is entitled to have them dealt with and heard in the ordinary course of the Court's business unless some strong countervailing consideration can be demonstrated'. 15 In Sterling Pharmaceuticals at 291, Lockhart J sought to provide something of a check-list of matters that might be considered. These included the priority in point of time of the institution of the different proceedings; whether the termination of one proceeding was likely to have a material effect on the other; the public interest; the undesirability of waste of time and effort; and of course, costs, if substantially the same issues were to be ventilated in actions in different courts; the general policy of the law discouraging multiplicity of proceedings in relation to similar issues; and, as his Honour said, '[g]enerally balancing the advantages and disadvantages to each party'. 16 In Wang , Bowen CJ stressed that, where a public regulator is seeking an injunction to restrain conduct which might mislead or deceive members of the public generally (and, I would interpolate, a relevant section or sections of the public, even if numerically small), 'the weight of public interest in the scales in favour of rejecting an application for a stay would be very heavy. 18 Accordingly, I reject the application for a stay with costs. I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick. | federal court original jurisdiction remedies and orders stay of proceedings sought multiplicity of proceedings possibly involving some common questions of fact factors to be considered before stay granted legitimate public interest considerations as justification for rejecting application for stay high court and federal court |
The University alleges that Dr Gray and a public company, Sirtex Medical Ltd (Sirtex) hold rights and entitlements deriving from the inventions on trust for the University. Dr Gray is the first respondent in these proceedings. Sirtex is the second respondent. Also sued is the Cancer Research Institute Incorporated (CRI), named as third respondent. CRI has a substantial shareholding in Sirtex which the University asserts is impressed with a trust in its favour. The inventions the subject of the litigation involve methods for the production of hollow microspheres for the delivery, to cancerous sites in the human body, of ionising agents and pharmaceutically active compounds (SIRT-spheres and DOX-spheres respectively). Another alleged invention comprises microspheres incorporating ferromagnetic particles which by application of magnetic fields can provide localised heating in cancerous tissues (Thermo-spheres). 2 Sirtex filed a defence to the University's claim against it stating, inter alia, that it relied upon warranties and representations made by Dr Gray about its uncontested title to the relevant intellectual property rights. It says, in effect, that it was not fixed with any knowledge of the University's assertions of its beneficial entitlement. As a fall-back position Sirtex cross-claimed against Dr Gray and CRI claiming that if it is held liable to the University then it is entitled to be indemnified by Dr Gray and CRI and, alternatively, to damages for misleading or deceptive conduct on their part. 3 Dr Gray now seeks leave to cross-claim against partners of the formerly Melbourne-based law firm Freehill Hollingdale & Page (Freehills) as it was composed in 1997 and 2000. The proposed cross-claim would allege that Freehills was engaged by Sirtex in 1997 and 2000 to undertake due diligence work in connection with the formation of Sirtex as a public company and its subsequent preparation of an initial public offering and listing on the Australia Stock Exchange (ASX). Dr Gray says that if he is liable to Sirtex because the University's claim to the disputed intellectual property rights succeeds, then it would follow that Freehills (1997) and Freehills (2000) were in breach of their duty to Sirtex in performing their due diligence functions. Further, he would allege that Freehills misled him (albeit not deliberately) and that he is entitled to damages from the former partners. 4 In my opinion the cause of action raised against Freehills could be brought as a cross-claim. However, because of the difficulties to which this would give rise as a matter of case management, even with a separate trial, I consider the better course is for Dr Gray to commence a distinct action against Freehills. His application for leave to cross-claim against them will be refused. Pursuant to a deed made in 1997 (the Gray Deed) Dr Gray assigned to Sirtex certain assets including his interests in inventions described in the deed. Similar assignments were made by CRI and Australian Surgical Products Ltd (ASPL). 6 Sirtex says, in its defence that, under the Gray Deed, Dr Gray warranted that all the patent and intellectual property rights material to its business, including the inventions acquired under all three deeds, were legally and beneficially vested in Sirtex, valid and enforceable, were not being infringed or attacked or opposed by any person and were not subject to any licence or authority in favour of another. He also warranted that to the best of his knowledge after making all due inquiries, there were no pending claims or applications in respect of the patents, know-how, rights or intellectual property rights in any of the acquired inventions or the subject matter of any of them other than the patent applications transferred to Sirtex by the Gray Deed and the CRI Deed. Sirtex pleads that, under the Gray Deed, Dr Gray represented and warranted that the warranties provided in the Subscription and Shareholders Agreement were true and accurate and not misleading in any respect. He is also said to have indemnified Sirtex against any claim for which it was liable in respect of any breach of the representation and warranty contained in the Gray Deed. 7 In [171] of its defence, Sirtex says that if (which is not admitted) Dr Gray was in breach of any fiduciary or contractual duty to the University or any duty pursuant to the patent regulations or the intellectual property regulations then Sirtex did not have actual knowledge of those matters and was not put under inquiry as to them. It was not fixed with the knowledge of Dr Gray with respect to those matters. 8 In its cross-claim against Dr Gray and CRI Sirtex repeats the warranties which it pleads, in the defence, were made by Dr Gray. It says that if the University is beneficially entitled to the acquired inventions then Dr Gray and CRI breached warranties given by each of them and each of the pleaded representations made by them was false and misleading to Sirtex. Sirtex says it would be entitled to be indemnified by Dr Gray in respect of any breach by him of his warranties. An alternative plea is made of misleading or deceptive conduct in breach of s 10 of the Fair Trading Act 1987 (WA). The cross-claim by Sirtex against Dr Gray and CRI is for damages under s 79 of the Fair Trading Act and for an indemnity in respect of damages, losses, liabilities and costs incurred by it as a result of the University's claim. 9 Dr Gray now seeks leave to raise a cross-claim against the partners, in 1997 and 2000 respectively, of the law firm Freehills in Melbourne. He defines the first set of former partners as "Freehills (1997)" and the second set as "Freehills (2000)". All are listed as proposed cross-respondents in his reamended minute of proposed third cross-claim. He alleges in the minute that Freehills (1997) caused Sirtex, formerly known as Paragon Medical Ltd (Paragon), to be incorporated as a public company on 21 April 1997. It changed its name to Sirtex on or about 3 April 2000. act as its legal advisors. These were said to comprise, inter alia, intellectual property rights defined in a deed of assignment. Dr Gray says he gave certain warranties and assurances to Sirtex about the intellectual property that CRI and ASPL assigned to it. Under the terms of the deed he was allotted 1,028,333 "A" ordinary shares and 341,662 "B" ordinary shares in Sirtex in satisfaction of a consideration of $2,739,999. CRI was allotted 433,332 "B" shares. ASPL received $100. Dr Gray alleges that Freehills (1997) failed to inform Sirtex of that correspondence. Had Freehills (1997) cited the correspondence then, according to Dr Gray's pleading, it would, as a legal practitioner, have had a duty, as part of the due diligence process, to recommend that Sirtex obtain releases from the University to any claim to the intellectual property. Dr Gray says that because of its failure to perform its retainer completely Freehills (1997) was in breach of its duty to Sirtex. As a result Sirtex completed its purchase of the intellectual property and entered into the Subscription and Shareholders Agreement. 14 Dr Gray then pleads that in January 2000 Sirtex engaged Freehills (2000) to carry out the due diligence process in relation to its public offering and ASX listing. It was a term of the retainer that Freehills (2000) would "investigate and advise" Sirtex on the validity of the assets of Sirtex including the intellectual property then registered in its name. It is also said that Freehills (2000) should have undertaken reasonable inquiries to determine whether Sirtex should seek any further releases from the University as to its ownership of the intellectual property. Freehills (2000), he says, failed to find out that the University might assert an interest in some of the intellectual property. They did not advise Sirtex as they ought to have. Other related breaches of duty are also alleged. 18 Dr Gray alleges that if the University succeeds in its action against Sirtex, Sirtex will suffer loss and damage. Freehills (1997) and Freehills (2000), if sued by Sirtex, will be liable to it for damages as a tortfeasor in respect of any loss suffered because of the judgment in favour of the University. Dr Gray says that ss 7(1)(c) and 7 (2) of the Law Reform (Contributory Negligence and Tortfeasors Contribution) Act 1947 (WA) have the effect that, if he is liable to Sirtex, he is entitled to recover from Freehills (1997) and Freehills (2000) such sum as the Court shall think fit in respect of any liability he is judged to have to Sirtex. 19 There follows a separate pleading that if Dr Gray is liable to the University then he is liable as a result of breaches of a duty of care owned to him by Freehills (1997) in failing to make inquiries relevant to the existence of correspondence raising a question about whether the University would assert an interest in some of the intellectual property. Alternatively he says that in failing to advise him to obtain releases from the University, Freehills (1997) breached its duty to him. 20 Dr Gray pleads that Freehills (1997) engaged in conduct that was misleading or deceptive in contravention of s 9 of the Fair Trading Act 1999 (Vic) and, alternatively, s 10 of the Fair Trading Act (WA). The release in the Barber letter constituted an effective release from all or any claims that the University might have to the intellectual property. 2. No further releases from the University were necessary under the Patents Regulations or the Intellectual Property Regulations in order for Dr Gray not to be at risk of suit by the University in relation to the title in the intellectual property. 21 Dr Gray also pleads that Freehills (2000) owed a duty of care to him to provide advice to protect him from harm including exposure to the risk of liability under the Subscription and Shareholders Agreement and the Gray Deed. Freehills (2000) is said to have failed in its duty by not advising him to seek any release from the University or any assurance from the University in addition to the contents of a letter written by Professor Barber. He claims against both Freehills (1997) and Freehills (2000) damages at common law and, alternatively, pursuant to the Fair Trading Acts of Victoria and Western Australia, a sum equal to any judgment against him and of the costs of defending those proceedings. Among the documents exhibited to the affidavit, some of which seem to have been unnecessarily exhibited, were copies of the correspondence which it was said that Freehills (1997) and Freehills (2000) should have identified and which should have formed the basis of advice to Sirtex. 23 In a letter dated 30 December 1994 Dr Yan Chen wrote to Dr Gray attaching a letter dated 21 December 1994 from patent attorneys, Wray & Associates, from whom she had sought professional advice in relation to the assignment and ownership of associated intellectual property. The patent attorneys said they understood that the bulk of the experimental work carried out in respect of the invention called "Controlled Release Preparation" was conducted while Dr Chen was an employee of the University either directly or indirectly through Royal Perth Hospital. The reason being that Professor Gray and yourself arrived at the invention whilst under the employ of the University. In these circumstances, and unless there is a separate agreement to the contrary, the intellectual property of an invention which arises in the course of an employee's usual duties automatically belongs to the employer. As such we suggest that you undertake discussions with the University to confirm the ownership of the present invention and any rights that you may have as an inventor. If UWA is the owner then it will be necessary for an authorised officer of the University to assign the invention to the Cancer Research Institute. The venture partner has requested that everyone we have associated with provide witness statements declaring they have no claim on the technology before any contract with the CRI could be undertaken. Professor Barber returned the release letter bearing his signature on 22 January 1997. Professor Barber said he had raised concerns about the potential for conflict of interest to arise in Dr Gray's various roles. In the future I rather doubt if they will be as clear cut. In particular I understand, although I do not believe you have ever advised me, that you are a director of Paragon Medical Ltd. This does raise the potential for a conflict of interest in any dealings I have with you on Paragon/Cancer Research Institute/University of Western Australia issues. 26 Dr Gray wrote back to Professor Barber on 5 March 1997. He said that he had been Medical Director of the Lions Cancer Institute and CRI, both of which were unpaid positions. He had not derived any income or benefit from any institution or company that he had been associated with during his employment with the University. Paragon had been little more than a shell company up to that time. In the letter he indicated that he was aware there could be some conflict of interest and had arranged to reduce his position from fulltime to 0.3 fractional fulltime. 27 On 17 June 1999 the Vice Chancellor of the University, Professor Schreuder wrote to Dr Gray informing him that the Anti-Corruption Commission had determined to refer to the University for investigation or other action allegations against Dr Gray that, while an employee of the University with clinical privileges at Royal Perth Hospital, he may have engaged in conduct which showed a conflict between his duty to his patients and employer and his interests arising from his position as a director and shareholder in Paragon. If you allege that the intellectual property was created outside your employment by the University, please indicate where the work was conducted and at what time. An affidavit sworn by Kon Mellos on 22 November 2006 was relied upon. Mr Mellos is a partner in Freehills. He joined the Melbourne firm of Freehills in March 1994 and became a partner on 1 July 1998. No contention was advanced that it was not identical with the firm comprising the persons listed in the schedule. If there be any disparity in particular names that does not go to the procedural question with which I am concerned here. Freehills (1997) was a partnership distinct from the firm carrying on the business under the name Freehill Hollingdale & Page in New South Wales, Queensland and Western Australia. At the time of the 1997 transaction Mr Mellos was a senior associate at Freehills (1997) and acting under the general supervision of a partner of that firm. 29 Mr Mellos said that a Singapore company, Nomura/JAFCO Investments (Asia) Ltd (Nomura) gave Freehills (1997) instructions to act for it in relation to the acquisition of an interest in technologies owned by Dr Gray and the CRI. The Nomura senior executive who was described by Mr Mellos as "the principal driver of the 1997 transaction" was Dr Michael Panaccio. According to Mr Mellos, Dr Panaccio requested that the 1997 transaction be effected by investment in a new company to be incorporated and to which relevant intellectual property would be assigned. Upon that investment the company would be owned in equal shares between Dr Gray or associated entities, CRI and entities managed by Nomura. 30 Mr Mellos said that Dr Panaccio requested that the costs of the due diligence and documentation be shared equally between the new company and Nomura. So far as patent review was concerned he was very specific that he only sought an appraisal of the patents on their face and not a thorough review of the relevant underlying intellectual property itself that was the subject of the patents. He requested that a new company be incorporated and that funds managed by Nomura would be invested in it as part of the 1997 transaction rather than being put into a pre-existing company owned by Dr Gray and his associated entities. This was to avoid the costs of having legal due diligence performed on a pre-existing company. Mr Mellos said that Nomura did not require Freehills (1997) to conduct a full due diligence and it was instructed not to do so. No instructions were received from Paragon. Dr Gray was represented by Blakiston & Crabb, a Perth-based firm of solicitors. They drafted the deed by which he assigned his intellectual property rights to Paragon. The deed was based on a document prepared by Freehills (1997). 32 Mr Mellos said that the involvement of Freehills (1997) in the 1997 transaction ceased when Sirtex was incorporated and all relevant agreements in relation to its incorporation and initial equity financing had been signed and the financing had been completed. There was no formal meeting for the execution of the documents for the 1997 transaction. They were sent to the various people that needed to sign them. As far as Freehills (1997) was concerned the 1997 transaction was then at an end and they ceased to act for Nomura on that matter. 33 Mr Mellos then described what he called the 2000 transaction. In early January 2000 Dr Panaccio, acting as a director of Sirtex, invited Freehills (2000) to put a proposal to Sirtex for the provision of legal services in respect of its proposed initial public offer and listing on the ASX. I shall again assume the identity of the parties comprising the Melbourne law firm as it stood in 2000 and the firm Freehills (2000) as defined elsewhere in these reasons. On 13 January 2000 Freehills (2000) was engaged by Dr Gray on behalf of Sirtex in relation to the 2000 transaction. It was instructed to conduct legal due diligence although this was not to include a detailed history of the development of the technology that was the subject of the inventions. 34 A due diligence committee was convened comprising Drs Gray and Panaccio from Sirtex, Mr K Kerridge from KTM Capital Pty Ltd underwriting the intellectual property, Mr Mellos as chairman of the committee, Mr Davey, then a senior associate of Freehills (2000) and Peter Messer from Deliotte Touche Tohmatsu. According to Mr Mellos, Sirtex did not want two partners in Freehills (2000) or Freehills Patent Attorneys on the due diligence committee as a transaction of that size did not warrant the cost that would have been involved. 35 A meeting of the due diligence committee on 11 February 2000 discussed intellectual property issues. The minutes of the meeting, exhibited to Mr Mellos' affidavit, show that Dr Panaccio suggested that the prospectus for the initial public offer should disclose that the University had not claimed any intellectual property rights over the spheres. Dr Gray is recorded as noting that a further intellectual property issue had also been discussed briefly with Mr Cherry of Freehills (2000) who wanted more time to consider the matter. The issue related to the property in the results of clinical trials conducted at the University while Dr Gray was working there. They were conducted in an academic context. Mr Mellos said that it would be a time consuming and possibly inconclusive process to determine the ownership of the trial results. They would have to review the policy of the University, the terms of engagement of Dr Gray and other agreements governing the ownership of intellectual property generated within the University. Mr Mellos queried whether a commercial agreement could be reached with the University as an alternative to such a review. Dr Gray is recorded as saying that the University had previously provided a confirmation to the CRI that it had no claims and would not make any claims in the future in relation to ceramic microspheres, DOX-spheres or hyperthermia. This was apparently a reference to the letter from Professor Barber referred to earlier. Dr Gray said he would write to a Dr Burton at CRI who had been involved with the development of the resin microspheres during the 1980s to seek his confirmation that no claim would be made by him in relation to the ceramic microspheres used by the company. 36 Mr Mellos said that the exchange of correspondence between CRI and Dr Barber in January 1997 indicated to Freehills (2000) that the University had no underlying claim in respect of the clinical trials data or the underlying intellectual property. Freehills (2000) was not provided with any correspondence in relation to any potential interest that the University might have had in either the clinical trials or the underlying intellectual property other than those two letters. 37 Due diligence questionnaires were issued, including a questionnaire sent to Dr Gray on 3 February 2000. A copy was exhibited to Mr Mellos' affidavit. Supplementary questionnaires were sent to Dr Gray on 18 February 2000, 9 March 2000 and 23 March 2000. On 10 July 2000 a "refresh" questionnaire was sent to him. Dr Gray answered in the negative a number of questions asking if there were any matter adversely affecting any intellectual property or rights under any licence of intellectual property to the company or any group company. 38 The due diligence committee prepared a report which was based in part on the answers to the questionnaires. Members of the committee took responsibility for the verification of particular statements in the prospectus. According to Mr Mellos the verification notes demonstrate that it was the responsibility of Dr Gray to verify all statements in relation to intellectual property. Before issuing the prospectus all the directors of Sirtex, including Dr Gray, were required to sign a document entitled "Director's Sign Off and Consent" by which they verified that none of the statements in the prospectus were misleading or deceptive to their knowledge and that there were no other matters that ought to be disclosed. 39 The 2000 transaction came to an end from the point of view of Freehills (2000) upon the listing of Sirtex on the ASX. Mr Mellos pointed out that the firm which now carries on business as Freehills is not the same as Freehills (2000). It was formed with effect from 1 July 2000 as a result of the merger of the separate partnerships of Freehill Hollingdale & Page Sydney (which included Brisbane), Melbourne and Perth. The national partnership did not assume any obligation or liability of any of the previous partnerships. A cross-claim may proceed notwithstanding that judgment has been pronounced and an order made and entered on the originating process or any other cross-claim in the proceeding, or that the proceeding on the originating process or any other cross-claim is staved, dismissed or discontinued. There were some criticisms advanced from Freehills about the viability of certain aspects of the cross-claim. It was suggested that Dr Gray's reliance upon the Law Reform (Contributory Negligence and Tortfeasors Contribution) Act was misconceived. The causes of action relied upon by Sirtex in its cross-claim against Dr Gray were said not to be actions in tort, but for breaches of contract and misleading or deceptive conduct contrary to the Fair Trading Act . If Sirtex were not claiming against Dr Gray as a tortfeasor then he could hardly join Freehills as a joint tortfeasor. There may be a question also whether the relevant statutes are the Western Australian ones cited or their Victorian equivalents. This is not particularly vital at this stage as there are causes of action raised against Freehills (1997) and Freehills (2000) which, on the face of it, are not manifestly untenable nor without any reasonable prospect of success. They are, however, distinct causes of action based upon duties said to be owed not only to Sirtex but also directly to Dr Gray. 46 The materials presently before the Court do not indicate that Dr Gray has a strong case against Freehills (1997) and Freehills (2000). But the opposition to the cross-claim was not put upon the basis that it had no reasonable prospect of success. It was not proposed that leave to cross-claim should be refused on the basis that if granted the cross-claim could be disposed of summarily. The question of leave to cross-claim therefore largely reduces to a matter of case management. 47 There are a number of options open to the Court dealing with the application for leave to cross-claim. To give leave to cross-claim and to direct that the trial of the cross-claim be heard concurrently with the trial of the primary action, with evidence in the claim to be evidence in all cross-claims and vice-versa. 2. Give leave to cross-claim but order a separate trial of the cross-claim with leave to Freehills' counsel to participate in the primary proceedings to the extent necessary to enable the Freehills' respondents to resist findings of the primary liabilities as between the University and Sirtex and between Sirtex and Dr Gray upon which the causes of action asserted against them ultimately rest. 3. Give leave to cross-claim and order a separate trial with no presumption that the findings of fact in the primary proceedings will be adopted at the trial of the cross-claim. 4. Refuse leave to cross-claim, albeit Dr Gray would be free to pursue his cross-claim by separate proceedings against Freehills (1997) and Freehills (2000). The allegations raised against Freehills (1997) and Freehills (2000) involve new issues going to the contractual arrangements entered into between the Freehills' respondents and Sirtex, the performance of the retainers, the operation of the due diligence committee and the role of Dr Gray on it. Questions of reliance and causation in connection with the effect of the alleged conduct or inaction by the Freehills' respondents on any loss suffered by Sirtex and Dr Gray would attract their own paper and evidentiary trail. The potential for additional discovery and inspection processes is significant. The trial of the matter is imminent. It is listed for up to eight weeks commencing 12 March 2007. It is not reasonable to expect the Freehills' respondents to be in a position to defend the cross-claim within that time. This option is, in any event, not proposed by any party. 49 The question then arises whether the cross-claim could proceed with a separate trial on the basis that the Freehills' respondents have leave to be represented at the trial of the primary action so that they can, if they wish, join in contesting the primary claim and the Sirtex cross-claim upon which the proposed cross-claim against them depends. While it might be expected the role of competent legal representatives for the Freehills' respondents at trial would be economical and supplementary to that of the principal protagonists, there is nevertheless an inescapable risk of further complication of an already complicated action and extension of the duration of the trial. It would require representatives of the Freehills' respondents to be in a position to make effective forensic judgments about the scope of their involvement at various points in the trial. To do so it is likely they would have to master a large amount of material already disclosed in the discovery process between the principal parties. While it may be possible to define issues reserved to the separate hearing of the cross-claim which would not be determined by the findings in the primary proceedings, such definitions can give rise to debate about their limits. 50 In my opinion, given the stage which the proceedings have reached, the introduction of an additional party into the hearing, even if the cross-claim itself were to be separately tried, is likely to unduly complicate and extend the trial. While it is desirable that all aspects of a matter before the Court should be finally resolved the Rules of Court recognise that where cross-claims against non-parties are proposed there is a proper discretion to limit the scope of the litigation and that the Court is not obliged to deal with an ongoing chain of dependent proceedings as part of the same matter. 51 If the University succeeds in its claims against Dr Gray and Sirtex and Sirtex then succeeds in its cross-claim against Dr Gray, he may decide to institute separate proceedings against the Freehills' respondents. Those respondents would not be bound by the findings in the primary proceedings and it may be open to contest issues of fact and law dealt with by those findings. However they could well do so at the risk of adverse costs orders if the same findings were reached, notwithstanding that they succeeded in defending the claims against them by Dr Gray. There is, I think, a reasonable prospect that a degree of commonsense would apply to the question whether findings in the primary proceedings were disputed in subsequent proceedings against the Freehills' respondents. On the other hand, if the University fails in its claims against Dr Gray or if Sirtex fails in its cross-claim against Dr Gray, the proposed proceedings against the Freehills' respondents would, in all likelihood, become unnecessary. 52 I appreciate that some of the preceding considerations are applicable to a large range of cases in which leave is sought to cross-claim against a non party. But it is their particular application to this case that is relevant here. In my opinion, however, in the circumstances of this case, the granting of leave would be likely to add to the complexity and costs of the proceedings and possibly to the duration of the trial. I see no advantage in the third option of giving leave to cross-claim on the basis that it could be heard separately and that the parties to it are not bound by the findings at trial. I propose therefore to refuse leave to cross-claim. I certify that the preceding fifty-three (53) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. | cross-claim against third party leave to bring cross-claim subject matter of cross-claim related to or connected with the subject of the proceeding case management considerations long complex trial imminent complexity increased by introduction of additional party possibility that cross-claim may be unnecessary leave to cross-claim refused practice and procedure |
Attached to the notice of motion are lists of the documents to which the applicant sought access. 2 The main proceeding involves a challenge to the constitutional validity of certain levies on the grounds that, contrary to s 90 of the Commonwealth Constitution , they are excise duties. 3 On 14 July 2008 the Court ordered the second respondent to provide discovery of certain categories of documents said to be relevant to whether or not the above charges can be characterised as excises. In accordance with that order the second respondent filed three lists of documents originating from departments of the second respondent, being the Department of Territory and Municipal Services, the Chief Minister's Department and the Department of Treasury. The second respondent claimed public interest immunity and legal professional privilege in respect of the documents listed in part 2 of schedule 1 to each list. 4 When the notice of motion came on for hearing before me on 10 December 2008, Mr Kirk of Counsel, who appeared for the applicant, advised that the applicant no longer pressed its claim for access to documents in respect of which the second respondent claimed legal professional privilege. Similarly, in respect of those documents to which the applicant still presses its claim, it does not seek access to those portions of these documents which are subject to a claim for legal professional privilege. Mr Kirk noted, however, that some of those documents had, in fact, been produced. Subsequent to the hearing the applicant, at the request of the Court, provided an affidavit sworn on 18 December 2008 by John Andrew Larkings, of Williams Love & Nicol Lawyers, solicitors for the applicant. Mr Larkings' affidavit confirmed the above and annexed a revised list of the documents showing those to which the applicant currently seeks access. The list also shows those documents where there is an unchallenged claim to legal professional privilege over part, but where the claim for access to the remainder of the document is still pressed. The revised list is annexed as a schedule to these reasons. The applicant claims that its interest in challenging the levies referred to above is that both have been passed on by ACTEW to the applicant. Paragraphs [21]-[29] of the applicant's submissions on the question of public interest immunity contain a convenient summary of the basis of its challenge. The basis of the constitutional challenge to both levies is s 90 of the Constitution , which provides that the power of the Commonwealth Parliament to "impose duties of customs and of excise" is "exclusive". An excise is a tax imposed on goods. At issue in the proceedings as regards both levies is whether or not each can properly be characterised as a tax. The classical, albeit non-exhaustive, definition of a tax is "a compulsory exaction of money by a public authority for public purposes, enforceable by law, and ... not a payment for services rendered" ... The very definition of a tax, therefore, involves ascertainment of the purpose of the measure in question. Moreover, in this proceeding what is also at issue as regards both levies is specifically whether or not the levies can be characterised as "a charge for the appropriation of a limited and valuable public resource" as regards the WAC [water abstraction charge] ... or it a fee for the right to use land as regards the UNFT [network facilities tax] ... as opposed to a tax.... In part the task of distinguishing between such a fee or charge and a tax will depend upon whether "the amount of the exaction has no discernible relationship with the value of what is acquired"... However, [it] is also relevant to seek to ascertain whether the true purpose of the measure, properly understood, is to raise revenue. ... It is the case of the Applicant that the purpose of both measures is to raise revenue for the ACT and that both should be characterised as, in truth, taxes. The purpose in character of the levies in question is thus a constitutional fact at issue in this case. That constitutional validity, and associated constitutional facts, are at issue is a matter of significance in this case. It touches upon the fourth factor identified by the Full Federal Court in Northern Land Council, namely the seriousness of the issues in relation to which production is sought. ... In this context, to the extent that it is relevant to take account of considerations such as candour by public servants, or other such justifications used in support of the claim for [public interest immunity] in relation to this type of cabinet documents, it must be recalled that the very existence of the government in question ultimately is founded upon the Constitution and is subject to it. Section 130 of the Evidence Act 1995 (Cth) is not relevant here as it deals with the balance between the public interest in admitting information or documents into evidence and public interest immunity. 8 The leading case with respect to public interest immunity is Sankey v Whitlam [1978] HCA 43 ; (1978) 142 CLR 1. Proceedings had been brought against a former Prime Minister of Australia and three former Commonwealth Ministers in which it was alleged that the defendants had been involved in a conspiracy to effect a purpose unlawful under Commonwealth law as well as a conspiracy at common law to deceive the Governor-General. The High Court heard an application that Commonwealth documents which public interest immunity was claimed should nonetheless be disclosed. 9 I agree with Wilcox J's comment in North Australian Aboriginal Legal Aid Service Inc v Bradley [2001] FCA 1080 at [8] that the headnote to the report of Whitlam v Sankey in the Commonwealth Law Reports accurately summarises the substantial common ground between the members of the High Court, each of whom wrote a separate judgment. It is, however, useful to refer to individual judgments which discuss the principles more specifically. Before doing so, I note that the Court in Sankey was referring both to the production of documents and to their admission into evidence. As stated above, s 130 of the Evidence Act now deals specifically with claims of public interest immunity in the context of the admission of evidence; however, this does not detract from the relevance of the High Court's comment on the issue of disclosure. However the public interest has two aspects which may conflict. The fundamental and governing principle is that documents in the class may be withheld from production only when this is necessary in the public interest. In a particular case the court must balance the general desirability that documents of that kind should not be disclosed against the need to produce them in the interests of justice. The court will of course examine the question with especial care, giving full weight to the reasons for preserving the secrecy of documents of this class, but it will not treat all such documents as entitled the same measure of protection - the extent of protection required will depend to some extent on the general subject matter with which the documents are concerned. 12 Among the classes of documents mentioned by his Honour were Cabinet documents and other papers concerned with policy decisions at a high-level. His Honour noted that, despite claims that such documents were absolutely protected from production, in his view they did not form a homogenous class "all members of which must be treated alike". 13 A more recent, but not inconsistent, analysis is to be found in Commonwealth v Northern Land Council [1993] HCA 24 ; (1993) 176 CLR 604 where the issue was whether the Commonwealth was obliged to produce for inspection notebooks recording the deliberations of Cabinet or committees of Cabinet made variously by Cabinet officers or departmental officers. The context was the Northern Land Council's action to set aside an agreement it had made with the Commonwealth on the basis that the Commonwealth had acted unconscionably in negotiating and entering into that agreement. 14 The High Court, (Mason CJ, Brennan, Deane, Dawson, Gaudron and McHugh JJ, Toohey J dissenting) ordered the Commonwealth to produce the documents. In their joint judgment the majority observed, at 616, that it was "hardly contestable" that records of the actual deliberations of Cabinet fell within the class of documents in respect of which "there are strong considerations of public policy militating against disclosure". Nevertheless even for these documents their Honours accepted that the protection is not absolute and the claim of public interest immunity must be weighed against public interest in the administration of justice. They noted, however, (at 617) that the routine inspection of documents for which immunity is claimed on a class basis would be "to disregard the basis of the immunity for a document falling within the class described". Their Honours concluded at 617 that the distinction between class and content claims is "often rough and imprecise" and that it may be necessary to inspect a document to determine whether it attracts immunity. Obviously, there are extremely strong considerations of public policy weighing against their production regardless of how significant disclosure of the contents might be to the case of one side or the other in the proceedings in which the claim for immunity is raised. ... It follows that, in our view, it is only in a case where there are quite exceptional circumstances which give rise to significant likelihood that the public interest in the proper administration of justice outweighs the very high public interest in the confidentiality of documents recording Cabinet deliberations that it will be necessary or appropriate to order production of the documents to the court. 15 The applicant submits that "by implication, such a stringent approach is not adopted with respect to other types of documents which might be described as "Cabinet documents", such as reports or submissions for the assistance of Cabinet". The discouragement of candour on the part of public officials has been questioned as a sufficient, or even valid, basis upon which to claim immunity. On the other hand, Lord Wilberforce has expressed the view that, in recent years, this consideration has "received an excessive dose of cold water". [see Burmah Oil Co Ltd v Bank of England [1979] UKHL 4 ; [1980] AC 1090 at 1112]. 16 The principle was certainly subject to some expression of scepticism by Wilcox J in North Australian Aboriginal Legal Aid Service v Bradley [2001] FCA 1080. The matter involved a controversy over the appointment of Mr Bradley as Chief Magistrate of the Northern Territory. The Northern Territory government claimed that certain documents that the applicant wished it to disclose were protected by public interest immunity. It was claimed that the production of the documents would adversely affect the processes and functioning of the Northern Territory Cabinet. One document records a decision of the Cabinet, but it does not indicate which Ministers favoured that decision or whether any Ministers took a contrary view. It gives no information as to whether or not there was a Cabinet debate and, if so, what points were argued or by whom. It follows that disclosure of that document would have none of the consequences identified by the Northern Land Council majority .... The other subject documents all fall into one of three categories. First, there are memoranda between officers of the Northern Territory government concerning two subjects: proposed amendments to the Magistrates Act (NT) and the powers of the Administrator in relation to determination of the remuneration of the Chief Magistrate. The second category comprises various drafts, and the final version, of a Cabinet submission to amend the Magistrates Act in particular respects. Departmental comments are noted on some drafts. Third, there are memoranda from officers of the Department of Attorney-General to the Attorney-General submitting to him the various drafts, and the final version, of the Cabinet Submission. 17 His Honour reviewed the documents on the basis that the claim for public interest immunity was based on the possible in addition of candour. His Honour accepted that there are situations where public officers might be discouraged from a candid expression of their views because they believed or feared that their words might be revealed to others and that "any such discouragement would be inimical to the public interest". He added, however that "everything must depend upon the nature, and subject matter of the documents". 18 Wilcox J attached importance to the fact that one claim made by the applicant was that the Northern Territory government was "actuated by improper purpose" in appointing Mr Bradley. In the case of a body politic, this can only be done by proving the actions, motives and reasons, of those who acted in the matter on behalf of the body politic. Any exclusion of evidence about the actions of senior government officers, whether Ministers or public servants, is likely to impede proof of those actions, motives and reasons. 19 In concluding that the documents should be disclosed, his Honour (correctly, in my respectful opinion) weighed the impact that disclosure would have on the public interest against the impact that non-disclosure would have on the administration of justice. Wilcox J expressed some doubt as to whether there could be "substance in a "class" claim based on the inhibition of candour" it is clear from his Honour's reasons that, consistent with the comments of the High Court in Northern Land Council, Wilcox J recognised that the decision in any particular case very much depends on the facts of that case. 20 The class/content categories are not absolute or mutually exclusive. The distinction gives a starting point. It recognises that some classes of documents, by reason of their provenance, attract a higher degree of public interest in their confidentiality than others. It requires therefore, a commensurately higher likelihood that the public interest in the administration of justice requires their disclosure for them to be deprived of public interest immunity. It is clear that there is an extremely high public interest in the confidentiality of documents recording Cabinet deliberations. In general it may be said that the more closely connected documents are with actual Cabinet deliberations the greater the need to disclose them in the interests of the administration must be for access to be granted. Ultimately, it is for the Court in the individual case to assess the material for which public interest immunity is claimed and to balance the factors referred to in Sankey v Whitlam. The general principles are not controversial and previous decisions dealing with different material can be of only limited assistance. It stated that the documents which it seeks to inspect disclose the background to the imposition of the levies it seeks to set aside and claimed that "the intentions of the executive branch in introducing the measure are relevant to ascertaining the purposes of the Act, just as the purpose of legislation may be found from a Minister's Second Reading Speech". Drafting instructions to Parliamentary Counsel's office. In support of its claim for public and interest immunity, the second respondent filed three affidavits, all made on the 5 December 2008. They are the affidavits of Daniel James Stewart, Director of Economic, Regional and Planning Policy in the Department of the Chief Minister of the ACT; Hamish Murray McNulty, Executive Director, Environment and Recreation in the ACT Department of Territory and Municipal Services; and Jason Paul McNamara, Director, Economics Branch of the ACT Department of Treasury. These gentlemen all deposed to the nature of the documents that fell within their respective areas of responsibility and made cogent submissions as to why the claim of public interest immunity in respect of the documents should be upheld. 24 The way in which the applicant has categorised the disputed documents (see [22] above) ranks them in descending order of proximity to actual Cabinet deliberations. Category 1, (submissions to Cabinet) would, as a class, have the strongest claim to public interest immunity and Category 5 (drafting instructions to Parliamentary Counsel's office) would have the weakest claim. The documents in each of the applicant's categories are listed in the following table and are identified by the document number in the revised list in the schedule to these reasons and the source of each document. The allocation of documents to categories in the table differs from that of the applicant only in a few instances. Where the applicant expressed a doubt as to a correct categorisation, for instance in relation to Treasury document 278, or where the accuracy of the categorisation was not clear to me, I have checked the documents and reallocated them if necessary. In some cases the position was not entirely clear. For instance, document 19 from the Chief Minister's Department may have been a draft submission to Cabinet rather than having actually been put to Cabinet. In view of the conclusions which I have reached this has no present significance. Applicant's Category Source of document Document number 1. Submissions to Cabinet Department of Treasury 262, 278 Chief Minister's Department 10, 19, 26, 15 Territory & Municipal Services 272, 289 2. Draft submissions to Cabinet Department of Treasury 244, 258, 266, 289 Chief Minister's Department 20, 27, 28 Territory & Municipal Services 295 3. Minutes/briefs to Ministers Department of Treasury 236, 242, 276, 255, 274, 286, 287, 288 Chief Minister's Department 21-24, 25 Territory & Municipal Services 281, 293, 294 4. Inter/intra departmental correspondence Department of Treasury 261, 276 (sic), 277, 279, 280, 281, 282, 283 5. In general I have not needed to do so, however, I have done so where there was any doubt in my mind about the nature of the document or its contents. I have also reviewed document 293 from the Department of Territory & Municipal Services. By oversight, this document was not mentioned in the affidavit of Mr McNulty and the second respondent invited me to review this document. Having done so, I am satisfied that it belongs in Category 3 as a brief to the Treasurer in preparation for a submission to Cabinet. 26 It is not necessary that I set out in detail the comments made about each particular document in the affidavits referred to above. The affidavits were read in Court and are now part of the public record. For present purposes it is sufficient to note that each gentleman made cogent submissions in support of the second respondent's position. Underlying these submissions was reliance on the principles of the confidentiality of the Cabinet deliberation process and collective responsibility for Cabinet decisions. In so far as the documents in Categories 1-4 are concerned, they were all submitted to be part of the process of briefing ministers and preparing reports for deliberation in Cabinet, even where the documents were not directly considered by Cabinet. 27 Two documents (Department of Treasury documents 251, 256 and 284) are categorised as drafting instructions to Parliamentary Counsel's office. Document 251 contains instructions in relation to drafting the legislation imposing Utilities (Network Facilities) Tax . Mr McNamara alleged at paragraph 9 of his affidavit that these instructions sought the drafting of a Bill which was "to be input into a Cabinet Submission. The subsequent Cabinet Submission was deliberated upon by Cabinet". Mr McNamara claimed that disclosure of this document would breach Cabinet confidentiality and collective responsibility. Document 256 does not contain any such instructions but is it a request for legal advice. Not surprisingly, this is not clear from the revised list in the schedule or in the applicant's categorisation of the documents and it explains why, as the applicant noted, public interest immunity was not originally claimed in relation to this document. In Mr McNamara's affidavit the claim for public interest immunity in relation to this document is supported by the same argument as for document 251. I would not object to the email being released, however the claim of public interest immunity is maintained in relation to the attached Bill, as I believe that the release of this document would be contrary to the public interest ... Despite the position taken by Mr McNamara, the second respondent did not resile from its submission in relation to the document and the applicant did not distinguish between the two documents. 28 It is inevitable that the applicant was not able to take issue with the evidence given by Mr McNamara, Mr McNulty and Mr Stewart. Not having had access to the documents, the applicant has had to rely on rather more general submissions of principle. 29 The applicant contends that whether the levies can be characterised as payment for services rendered is relevant to determining whether they impose an excise. One measure of this, it is submitted, is whether a relationship can be discerned between the charge and the value of what is acquired. The applicant submitted that while the objective of raising revenue is not an invariable characteristic of taxation it will often be significant; Air Services Australia v Canadian Airlines [1999] HCA 62 ; (1999) 202 CLR 133 per Gleeson CJ and Kirby J at [91]. That being so it was submitted, "The purpose and character of the levies in question thus a constitutional fact at issue in this case". 30 In my view, insofar as this submission is intended to rebut the second respondent's claim of public interest immunity, it is misconceived. Determining whether legislation imposes an excise is an exercise in statutory interpretation. The days have long passed when the courts held that the meaning of legislation had to be ascertained only with reference to the words of the statute. The range of extrinsic material to which a court may refer as an aid to interpretation has been identified by statute (eg Acts Interpretation Act 1901 (Cth), s 15AB) , in judicial pronouncements and by academic analysis and it is not necessary to canvass its extent here. 31 It is also a well-established principle of statutory construction that a court may, indeed should, consider the object or purpose of an Act and its context; CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2 ; (1997) 187 CLR 384 at 408. The applicant is correct in submitting that this is not only legitimate but desirable however it is the purpose of the statute (sometimes expressed as "the intention of Parliament") as revealed by legitimate techniques of interpretation not the purpose of the government or the executive that is relevant. While the Minister's Second Reading Speech made in Parliament may be relevant to indicate the purpose of the statute as accepted by the Parliament, the same cannot be said of documents considered by the Executive in the course of deciding what legislation is required or in the process of drafting the legislation. This much is clear from the comments of the Full Court in Sportodds Systems Pty Ltd v New South Wales [2003] FCAFC 237 ; (2003) 133 FCR 63 where the Court held that it was permissible to refer to the Second Reading Speech of the Bill for the Racing Legislation Amendment (Bookmakers) Act in the Legislative Assembly of the New South Wales Parliament on 19 March 2002. 32 In the Constitutional context, the need to consider not only the language of the statute but also its purpose and practical operation was recognised in Ha v State of New South Wales [1997] HCA 34 ; (1997) 189 CLR 465 , the leading authority on s 90 of the Constitution . There was no suggestion that in considering the purpose of the statute that the Court might move beyond the usual aids to interpretation to consider material generated within the Executive. 33 The applicant referred to Sankey v Whitlam not only in relation to the principles there articulated but also as an example of a case in which documents similar to those presently under consideration were ordered to be disclosed despite the claim for public interest immunity. As mentioned above, Sankey v Whitlam concerned criminal proceedings and allegations of conspiracy to deceive and unlawful purpose. The allegations involved implications of moral turpitude not merely actions being beyond power. In such a situation obviously the imperatives of justice and the need to ensure that its administration is not obstructed are compelling. In those circumstances, it is not surprising that the justice imperatives outweighed the public interest in the confidentiality of the documents in question. 34 This case is quite different. The applicant's claim is that the impugned legislation is beyond the legislative power of the ACT government; there is no claim of any ethical or moral impropriety. For the reasons given above it is my view that the documents in question have little if any relevance to the case the applicant needs to make out if it is to succeed in its claim. The considerations lead me to conclude that to deny the applicant access to the documents in question would have little if any impact on the applicant's access to justice in the present case. On that basis I conclude that the public interest in non-disclosure of the documents generally outweighs the public interest in their disclosure. The only exception I would make is that position in relation to document 284 referred to in [27] above, I shall allow the applicant access to the email but not to the attached draft Bill. I have reviewed that email and conclude that Mr McNamara's concession was well made. At the hearing neither party made any submission in relation to costs however I see no reason why costs should not follow the event in the usual way and will so order. I certify that the preceding thirty-five- (35 numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Stone. 1316 3/11/06 3 Nov 06 List of Documents of the Department of Territory & Municipal Services dated 26 August 2008 (and as amended on 24 September 2008) Document Description Date 272 Cabinet Submission No. 5845 (decision No. 7252) on introduction of WAC (portion subject to LPP not challenged) 10/03/1999 281 Email from Brian Wilkinson with draft WAC budget brief 19/06/2006 289 Cabinet Submission No. 5851 and decision No. | discovery of documents claim of public interest immunity australian capital territory government documents cabinet deliberations, drafting instructions to parliamentary counsel's office need to weigh public interest in confidentiality of documents against public interest in administration of justice practice and procedure |
2 The Application for the Interim Injunction was heard at 8.30am today. A declaration that the Respondent has failed to comply with its statutory duty pursuant to Section 203BB(1) of the Native Title Act 1993 as representative body to facilitate and assist the Brim Family in and around Kuranda being persons who may hold native title to participate in Native Title Application 6004/98 despite requests to do so. 5 The Applicant in the present proceedings is Gordon Charlie. The Dingaal People are the traditional owners of lands and islands at and around Cape Flattery which is approximately 60 kilometres north of Cooktown in far North Queensland. (b) On 8 December 1997, Justice Beaumont made a native title consent determination which recognised the common law native title of various clans in connection with lands at Hope Vale of which the Dingaal People were one. Gordon Charlie was an applicant in that proceeding (QC94/6). (c) The Charlie Family has a very close connection with the lands at and around Cape Flattery and the off-shore islands from Cape Flattery. The original Aboriginal name of the Charlie Family is Dingaal. (d) The Charlie Family incorporates a sub-group described as the Brims . The Brims have resided in the Northern Tablelands in and around Kuranda for a significant period however they trace their genealogy to a Charlie ancestor who was transferred to that area by way of the Mission system from Cape Flattery/Cape Bedford in the late 1800s. (e) A Genealogy Chart (attached to the affidavit) is said to demonstrate a connection between the Charlie and Brim families which was agreed upon by Gordon Charlie's late uncle, Dan Charlie and a researcher from James Cook University, Mr Henry Baru, in or about 1994. Henry Baru, now deceased, was the elder of the Baru/Yoren family who now make up the majority of the Applicants progressing the native title claim in connection with Lizard Island and off-shore islands from Cape Flattery (QUD6004/98). (f) For many years the Charlies and Brims have visited each other and interacted as a close community. Over the years, the Brims have become established in and around the Kuranda area and visited Hope Vale from time to time and their traditional land. The Brims have resisted moving to Hope Vale due to tension with the Baru and Yoren families, the presence of a large silica mine at Cape Flattery and by reason of the presence of a massacre site on the traditional lands disturbed by silica mining. Gordon Charlie says that it was his intention to ensure that the Brims were included in any native title claim made by the Dingaal or Yoren families although the traditional owners in and around Cape Flattery do not bear the Dingaal name but rather the name Biddi Baru . The Brims, however, are sub-group members of the Charlie family. The Biddi Baru Group has usurped the Dingaal name. (g) At all times, Gordon Charlie made anthropologists who contacted him about connection issues aware of the connection between the Charlies and the Brims. (h) The mainland portion of the claim made by Gordon Charlie as Applicant on behalf of the Dingaal People (QC94/6) was excised from the Lizard Island claim. The claim in respect of Lizard Island and the remaining islands was not progressed. A fresh Dingaal claim (QC6004/98) was filed. The Applicants on behalf of the Dingaal claim group included Gordon Charlie and Jonathon Charlie. (i) On 14 April 2003, at a meeting held at Hope Vale of claim group members, resolutions were passed that had the effect of removing the authority of Gordon Charlie and Jonathon Charlie to make a claim for and act as applicants in connection with the native title claim on behalf of the claim group. These resolutions represent a renunciation of traditional Dingaal law and custom in removing the senior elder as the individual entitled to make such a claim. (j) Approximately 70 members of the Charlie and Brim family groups from the Kuranda area have signed a mandate which recognises Gordon Charlie as senior Elder and spokesperson for the signatories and indicates that at least 70 members of the Dingaal clan oppose other clans being joined as clan group members in QUD6004/98. At least 180 people in and around Kuranda area are said to have a family connection to the Charlie/Brim line. The signatories to the mandate have expressed views to Gordon Charlie that the introduction of other clans who do no have an affiliation with Lizard Island into the claim group will cause difficulties in satisfying the registration test for the purposes of the Native Title Act 1993 (Cth) ('the Act'). (k) On 28 February 2006 and 1 March 2006, a meeting took place at Hope Vale of claim group members who resolved to include within the claim group members of the Thanil, Nguuruumungu, Gulaal, Ngaatha and Thittaar groups. Gordon Charlie and other Dingaal People from the Northern Tablelands were not able to attend the meeting as Marlene Thompson failed to arrive so as to drive those individuals to the meeting. (l) On 17 October 2006, the Cape York Land Council sent Gordon Charlie a letter attaching a notice of meeting to be held on Tuesday, 31 October 2006. By that notice, the Land Council invited all Dingaal, Ngaathawarra, Thittaar, Nguuruumungu, Thanil and Gulaal Peoples to attend an authorisation meeting to discuss amending the native title application on behalf of the Dingaal People to include other identified groups in the Dingaal native title claim. The purpose of the meeting was also to discuss any other variations to the Native Title application. The Land Council encouraged all members of the claimant groups to attend and in the covering letter said, 'Please contact us as soon as possible if you require transport or will not be available to attend the meeting. If you would like to know more about the meeting please contact Simon Downing or Kathrine Scott on free call 1800 623 548' . (m) On 20 October 2006, Gordon Charlie wrote to the Land Council advising that approximately 85 people would need to travel to the meeting and because of an apprehension about fights and threats, those attendees would require a security guard for the two days whilst those members were present at Hope Vale for the meeting. Gordon Charlie has not received a response to that letter. (n) Gordon Charlie says that he has spoken to a number of the Brims about the meeting. They are concerned that other clans will be added to the Dingaal claim for Lizard Island; that there has been insufficient notice given to them about the meeting, that the Brims have not been directly notified of the meeting; that the meeting will take place in the Hope Vale community centre and other clans will be present; that they will be subjected to threats and intimidation; that the meeting is to take place on a work day and therefore clan members will be disadvantaged and that a significant number of the Dingaal People will thus be excluded from the authorisation process and not have a representative from their family on the Applicant group. Since the interim relief is sought in aid of a declaration (and consequential orders) that the CYLC has failed to discharge obligations cast upon it by s 203BB(1) of the Act, I accept for interlocutory purposes that the Application relates to a matter under the Act. 7 On 14 April 2003, a meeting of clan group members took place at Hope Vale. Those members attending the meeting voted unanimously to continue with the meeting notwithstanding objections in writing by Gordon Charlie which were read to the meeting. Resolutions were passed at that meeting withdrawing the continuing authority of Gordon Charlie and Jonathon Charlie to continue to act as applicants. Resolutions were passed authorising Gary Yoren, Ned Yoren and Elaine Baru to act as applicants on behalf of the claim group in lieu of Gordon Charlie and Jonathon Charlie. An application was then made to the Court for an order pursuant to s 66B(1) of the Act that Gordon Charlie and Jonathon Charlie be replaced as 'current applicants' on behalf of the claim group by Gary Yoren, Ned Yoren and Elaine Baru. 8 On 17 September 2003, Cooper J considered that application and found that notwithstanding Gordon Charlie's contention that the traditional law and custom of the Dingaal People meant that only Gordon Charlie was entitled and thereby authorised to make a claim for native title on behalf of the claim group, there was no acceptable evidence of any such traditional law and custom and Cooper J was not prepared to find the existence of such a law or custom; and that the applicants on the motion were authorised by the meeting on 14 April 2003 for the purposes of s 251B(b) of the Act to make the application and be appointed as applicants on behalf of the claim group in lieu of Gordon Charlie and Jonathon Charlie. Cooper J made an order pursuant to s 66B(1) of the Act replacing Gordon Charlie and Jonathon Charlie as authorised applicants and made an order granting leave to the applicants to amend the Native Title Claimant Application. 9 On 28 February 2006 and 1 March 2006 at the Church Hall in Hope Vale, Dingaal clan group members met to consider, the registration test to be applied by the National Native Title Tribunal ('NNTT') on 1 May 2006, the current state of the native title claim, a presentation by the NNTT, a report and presentation by Dr Fiona Powell, a Consultant Anthropologist, proposed changes to the native title claim and future tasks to be undertaken by the Cape York Land Council. The meeting was attended by the applicants on behalf of the claim group, family representatives of the claim group, CYLC representatives, NNTT representatives and Dr Fiona Powell. 10 Based upon the presentation by NNTT representatives and a presentation concerning an anthropological overview of research conducted in the claim area by Dr Powell, the claim group, having considered those matters overnight on 28 February 2006, unanimously resolved to amend the Dingaal native title claim and include other groups, namely, Thanil, Nguuruumungu, Gulaal, Ngaatha and Thittaar. The tasks to be discharged by the CYLC included amendment of the applicant's list to include Amanda Baru as a replacement applicant in the light of the death of one of the applicants, an application to the NNTT for an extension of the date for the registration test to be applied to the Dingaal claim, the convening of meetings of the five nominated clan groups to be joined in the Dingaal claim to discuss whether those claim groups wished to be included in the Dingaal claim, the convening of a meeting of all groups to provide information on the progress of the claim and the conduct of further discussions with Dr Fiona Powell about the process involved in compiling a connection report. 11 A letter confirming all of these matters was sent to Gordon Charlie on 24 March 2006 by the CYLC. As discussed at the last meeting, this may involve changing the size of the claim area and including other groups in the claim. The attached work plan sets out the steps we need to take in order to make those changes. Please see Part B on page 2 that sets out the time table for meetings, anthropological work and amending the application. That meeting was expressly contemplated in the letters of 24 March 2006 and 24 May 2006. The covering letter of 17 October 2006 requested Gordon Charlie to contact the CYLC specifically in relation to transport requests and generally. Gordon Charlie on 20 October 2006 wrote to the CYLC advising that 85 people sought travel assistance and that a private security guard would need to be available for two days. 13 At no time after the receipt of the letters dated 24 March 2006 and 24 May 2006 from the CYLC did Gordon Charlie, on the evidence, write to the CYLC and set out those matters contended for by paragraphs 5(d), (e), (f) and (g). On 30 October 2006, the solicitors for Gordon Charlie sought to bring on this ex parte Application which was heard early this morning. Plainly, the CYLC has incurred considerable cost in convening the meeting of group members and clan members and the delay and dislocation caused by enjoining the meeting will inflict significant prejudice upon the Applicant representatives for the claim group, the claim group members and, in addition, the CYLC in the provision of support to claim group members in the prosecution of the Native Title Application. The Applicant comes to the Court at the last minute. The delay in agitating the matter is considerable. It seems to me that the balance of convenience lies in favour of allowing the meeting to proceed to consider and determine the matters before it. 14 Apart from the balance of convenience issue, the threshold matter involves an assessment of the basis upon which Gordon Charlie contends, as a matter of law, that the convening of the meeting by the CYLC and the consideration by the claim group and those attending the meeting of the particular questions to be resolved, gives rise to an arguable question of a contravention of the rights owed by the CYLC to Gordon Charlie or duties to be discharged by the CYLC, a breach of which is actionable by Gordon Charlie. 15 The central matters seems to be that a sub-group of the Dingaal, the Brims, have not been recognised as legitimate claim group members having a connection with the lands, the subject of the Native Title Claim Application. Because the Brims have not been so recognised, they have not received a Notice of Meeting and are not in a position to attend the meeting. Although Gordon Charlie says that he has told anthropologists of the genealogy link and the visitation arrangements between the Brims and the Charlies (5(f), 5(g)), there is no material demonstrating an arguable case of connection on the part of the Brims with the claim area such as an anthropology report or a draft preliminary research opinion. The extent of the connection is a recognition by some Brim members that Gordon Charlie is the representative of Brim signatories to a 'Mandate' document and that the Brims and the Charlies 'visited each other and interacted as a close community' (5(f)). I am not satisfied that the Applicant has demonstrated an arguable question of claim group connection on the part of the Brims with the lands the subject of the Application. 16 In any event, the contended recognised Elder of the Brims, Gordon Charlie, did receive the Notice of Meeting of 17 October 2006 despatched by the CYLC. 17 In reporting on 24 March 2006 on the outcome of the deliberations of the meeting on 28 February 2006 continued on 1 March 2006, the CYLC advised Gordon Charlie that Dr Fiona Powell had provided an overview based upon her field work in the claim area as an anthropologist of the need to address any rights and interests of other groups that share the claim area with the Dingaal. Those other groups were the five additional groups previously mentioned. There is no suggestion in that overview of any emergent anthropological evidence of rights or interests, based upon field work conducted in the claim area, on behalf of the Brims. 18 The genealogical chart attached to Gordon Charlie's affidavit dealing with the interconnection between the Charlies and the Brims makes reference to Toby Brim 'born around 1867 near Kuranda' as the child of 'Tji Auwin and Annie'. On 17 December 2004, Spender J made a determination that native title exists in relation to lands described by paragraph 1 of his Honour's order in favour of the Djabugay People being a determination arising out of a Native Title Claim Group Application on behalf of the Djabugay People the ancestors of which, identified by Schedule A of the Application for the purposes of s 61 of the Act, included, as the first two ancestors, 'Toby Brim and Annie Hunter'. There therefore seems to be a real question as to whether the Brims represent a claim group which have been the subject of an existing determination for the purposes of the Act. 19 Gordon Charlie asserts rights of participation in relevant meetings convened by the CYLC which, on the material, seem to be rights or entitlements enjoyed by the Brim Group. Even though Gordon Charlie contends that the Brims are a sub-group of the Charlies, they are nevertheless a separate sub-group. The contentions advanced in this Application ought really to be advanced by the Brims. In truth, he brings the proceedings in a representative capacity and in that regard it will be necessary for the Applicant to demonstrate a proper basis for the proceeding consistent with ss 69 and 70 of the Act and the Federal Court Rules . For the purposes of the present interlocutory Application, I proceed on the footing that Gordon Charlie brings the proceeding as a representative of the Brims in reliance upon the provision of the mandate document described at [19]. Mr Black, the solicitor for Gordon Charlie, accepts that the Applicant brings the proceeding on behalf of the Brims in reliance upon the mandate document and traditional law and custom. 21 Gordon Charlie says that the Cape York Land Council has failed to discharge the 'facilitation and assistance function' cast upon it by ss 203B(1)(a) and 203BB of the Act. The Applicant contends that the CYLC has failed to have regard to the interests of the Dingaal claim group; has failed to be satisfied that that group consents to any general course of action; has failed to promote the satisfactory representation of native title holders; has failed to maintain a process that promotes consultation and operates in a fair manner; and has failed to assist Dingaal claim group members and Brim sub-group members in consultations, negotiations and proceedings in relation to the Native Title Application. 27 The CYLC has established a process to isolate and determine those claim groups which may be in a position to establish, based upon research conducted in the claim area and otherwise, a connection with the lands the subject of the claims and thus identifiable common law native title rights and interests. That process has brought together claim group members on behalf of the Dingaal claim group, family representatives and applicants for a native title determination for the Dingaal claim group. In addition, a process has been established by the CYLC for the implementation of particular tasks reflected in the letters of 24 March 2006 and 24 May 2006 and a Work Plan which is designed to identify other groups which have established a basis for a shared connection with the claim area. The CYLC has identified steps designed to amend the Application both as to the area and the claimant groups, among other steps. There is no evidence in any of the material that the CYLC has failed to discharge any of the obligations conferred upon it by ss 203BA, 203BB, 203BC or 203BJ. As to s 203BJ(b), there is no evidence that the CYLC has failed to identify persons who may hold native title in the area the subject of the claim for which the body is the representative body. That function, of course, is not absolute, it is a function to be discharged 'as far as is reasonably practicable'. The CYLC has established processes reflected in the correspondence, Work Plan and steps taken to convene meetings of relevant claim group members or those members asserting interests in respect of the lands the subject of the claim, to discharge that obligation. Members of the Dingaal claim group have participated in those meetings and, in particular, the 'applicants' on behalf of the Dingaal claim group. Questions of whether the Dingaal claim group have 'by far and away the best claim' and whether other claim groups should be 'added on' and the extent to which such a course will affect the application of the registration test are all matters to be considered by the applicants and those claim group members participating in meetings convened by the CYLC. 28 An additional question arises as to whether intervention by the Court is, in any event, appropriate. 31 A further question is whether in seeking an interim injunction in respect of the performance by the CYLC of duties conferred upon it by the Act, the Applicant has standing (apart from any representative question) to seek orders which compel the performance of the public statutory duty by a body such as the CYLC. I do not propose to examine that question further but it raises another issue concerning the soundness of the arguable question as to a cause of action in the Applicant. 32 The remaining ground on behalf of the Applicant is that the CYLC failed to give reasonable notice to claim group members. The Notice of Meeting was issued on or about 17 October 2006 enclosed with a letter. The Applicant responded to that letter on 20 October 2006, 11 days before the meeting, requesting transport assistance but sought to impose terms that a security guard be provided for the two day meeting. I am not satisfied that the Notice of Meeting was too short. The CYLC extended an invitation to provide transport support but the Applicant sought to impose terms upon that support, in effect, rejecting the facilitation of transport. I am not satisfied that there is either a failure to perform functions on the part of the CYLC, in this respect. 33 Accordingly, I propose to dismiss the motion filed by the Applicant on 30 October 2006. | application for an interim injunction to restrain the conduct of an authorisation meeting at hope vale convened by the cape york land council in connection with a native title determination application by the dingaal claim group. native title |
The Tribunal had affirmed a decision of a delegate of the first respondent to refuse to grant a protection visa to the appellant. 2 The appellant is a citizen of Burma. He is a Christian. He entered Australia on a tourist visa on 31 March 2004. The appellant claimed to have been subjected to physical violence and intimidation from Burmese authorities following his support for the National League for Democracy and his involvement in a number of anti-government demonstrations. The appellant also claimed that he is easily mistaken for a Muslim in Burma given his Indo-Karen ethnicity and that, as a result, he feared that he would be targeted and physically harmed during anti-Muslim riots. Additionally, the appellant asserted that he had been the victim of daily discrimination as a Christian in Burma. 3 The Tribunal did not accept that the appellant had suffered persecution as a result of his Christian faith, and found that he had not demonstrated that he had suffered any limitations on his religious freedom. The Tribunal also noted that the appellant could not identify any specific incident where he had been targeted because of his Indo-Karen ethnicity, and held it was not satisfied that he had suffered persecution for a Convention reason. Further, the Tribunal found that it had been almost 20 years since the appellant had actively participated in political demonstrations, save for one in 1998 which he appeared to encounter by accident. The Tribunal concluded that it could not be satisfied that the appellant would face a real chance of persecution should he return to Burma. 4 On 9 June 2006, the appellant filed an application in the Federal Magistrates Court for review of the Tribunal's decision. In that application, the appellant asserted that the decision of the Tribunal was affected by jurisdictional error, claiming that it had failed to comply with s 424A of the Migration Act 1958 ("the Act ") in relation to claims that the appellant was known as an "Indian leader". It was also contended that the Tribunal had failed to take into account an integer of the claim, and failed to make necessary inquiries prior to forming its conclusions. 5 On 17 November 2006, McInnis FM rejected each of the claims made by the appellant and dismissed his application. 6 In this appeal the appellant only alleges error on the part of the Federal Magistrate in relation to his application of s 424A of the Act . That information was that, in Burma, he had "the profile of and was known as the Indian leader". The relevant information was identified, somewhat more expansively, in the appellant's notice of appeal as "information constituted by the absence of any reference in the initial application for a protection visa to the claim that the appellant had the profile of and was known as the Indian leader, and/or being the fact that one thing was said in the prior statement to the first respondent's department and another to the Tribunal at the review stage and/or the fact that if what was being asserted before the Tribunal was true it would have been in the prior statement in that form and/or the fact that one thing was said in the prior statement and no more. " In the course of a hearing before the Tribunal the Tribunal member raised with the appellant the point that the "Indian leader" claim had only recently been made. The appellant accepted that this was so and attributed it to a mix up when his initial statement was being prepared. Following the hearing the Tribunal wrote to the appellant's representatives, on 23 January 2006, drawing attention to various items of information and inviting the appellant to comment on that information. Your profile as a leader and activist in Burma seems to have increased in the time you first arrived in Australia and claimed protection and your more recent statements at the hearing. If you wish to comment please provide written details to the Tribunal. I refer to my previous comments in writing and orally, and to the legal submissions of my legal adviser. I reiterate the inadequacies and problems which I experienced with the initial evidence prepared by my previous legal adviser ... and note that this was one of the main reasons why I changed legal advisers. I have also sought to rectify any possible misunderstandings which could have arisen due to the incomplete nature of my initial claims. 12 The learned Federal Magistrate rejected this submission. In my view, the First Respondent's submissions in relation to this ground are correct. The s.424A letter, whilst couched in general terms in relation to the Applicant's profile, should be read in the context of material then before the Tribunal provided by the Applicant in additional declarations. The issue was further agitated at the hearing and clearly the description of the Applicant as an "Indian leader" is relevant to the profile and is part of the process of augmenting that profile which occurred after the initial statements prepared by others on behalf of the Applicant. I further note that in his Statutory Declaration dated 14 December 2005 the Applicant specifically refers to earlier material provided to the Department and then clearly added "by way of clarification" other material, including the assertion that he was known by the authorities as "the Indian leader". I accept, as submitted by the First Respondent, that those comments could properly be regarded as an acknowledgement of the previous statement by the Applicant and relied upon before the Tribunal contained omissions regarding the Applicant's profile as an Indian leader in the 1987 and 1988 demonstrations. The clarification of the Applicant's role was confirmed in the written submissions of the Tribunal of 16 December 2005 by the Applicant's representatives. The response to the s.424A letter by the Applicant clearly states that the Applicant refers to his "previous comments in writing and orally". It was submitted in the alternative by the First Respondent, and I accept, that the chronology of submissions and Statutory Declarations and the content of the material highlighted in this judgment demonstrate the Applicant had given information to the Tribunal about perceived omissions in his initial statements to the Department. In the alternative, I accept therefore, that s.424A does not apply, as that information would fall properly within the terms of s.424A(3)(b) of the Act (see SZCJR v Minister for Immigration and Multicultural Affairs [2006] FCA 1083 at [11] - [12] ). 14 The Tribunal's letter drew the appellant's attention to his "profile as a leader and activist in Burma" which may be seen to having increased in the period between his original protection claim and more recent statements made by him at the hearing. This information was said to be relevant because it indicated some inconsistent account relating to the appellant's claims. In Minister for Immigration and Multicultural Affairs v Al Shamry [2001] FCA 919 ; (2001) 110 FCR 27 at 34, 38-39, the Full Court indicated that the subject matter of the exception is information provided by the applicant for review by statutory declaration under para (a) of s 423(1) and in response to an invitation by the RRT under s 424(2). That construction was not challenged on this appeal and should be accepted. 16 The obligation imposed on the Tribunal by s 424A(1)(a) is an obligation to provide "particulars of any information that the Tribunal considers would be the reason, or part of the reason, for affirming the decision ... under review. " This provision requires the Tribunal to alert an applicant to specific information which it considers would be the reason for dismissing the applicant's claim. The Tribunal cannot resort to generality when the information it has relates to specific conduct by specific individuals and it is that conduct which is relied on by the Tribunal as the reason or part of the reason for it dismissing an appeal: see Minister for Immigration and Multicultural Affairs v SZGMF [2006] FCAFC 138 at [31] - [36] . 17 The legal issues raised by this case are somewhat different and, insofar as the researches of counsel and my own review of authority would suggest, are novel. The appellant's allegation of lack of specificity in this case focuses on the terminology adopted by the Tribunal when it sought information from the appellant in its letter of 23 January 2006. His contention is that the reference to "[y]our profile as a leader and activist in Burma ..." is insufficiently precise because it fails to make clear what information is comprehended by the word "profile". In particular, it is contended that the reference to the appellant's "profile" does not make clear to him that the Tribunal had in contemplation an adverse finding that he was not known as an Indian leader of demonstrations in 1987 and that a reason for this conclusion was that the claim was made for the first time at the review stage of his application. The respondent Minister contends that the appellant can be taken to have understood what was meant by the reference to his "profile" by reason of the various exchanges during the hearing before the Tribunal during which the member invited comment from the appellant about him being an "Indian leader". In your first lot of documents, you said you took part. You were a bystander. You were hit and you took part because you got angry. But there is no talk about you being an Indian leader or outer head. Its something that has come up more recently I think. I could be wrong. I was wondering why its only been raised more recently rather than in your initial statement. Past dealings between an applicant and the Tribunal may have involved the adoption of terminology which, although it may lack clarity if addressed to a third party, will readily be comprehensible to the applicant. 19 In this case, the reference, by the Tribunal, to the appellant's "profile" and changes to it between the time he made his original application and the time at which he was preparing submissions to the Tribunal and appearing before it can reasonably be seen to comprehend his claimed profile as an Indian leader. He used the term "profile" in this way in his statutory declaration of 14 December 2005. I wish to add by way of clarification that my involvement in the protest of 6 August 1987 was very important. I was a leader of this protest was in the front line. I was known by the authorities as "the Indian leader" because of my appearance and ethnicity. So at the time, the authorities considered me a leader. The same is the case later in the 8/8/1988 protest, where I again took a leading role in the demonstrations. Protesters at my house ("the Indian's house") before going to the demonstrations. This is why I continue to be monitored and pursued by the authorities. The relevant submission was that the appellant had "a profile as an active and prominent political dissident and pro-democracy activist, as well as having pro-Western sympathies. " That document also contained reference to the appellant's alleged "profile as security guard with the US Embassy and political dissident. One item of information which was identified was the appellant's "profile as a leader and activist in Burma [seeming] to have increased in the time [since he] first arrived in Australia and claimed protection and [his] more recent statements at the hearing. " I have come to the view that the language employed by the Tribunal has failed to satisfy its obligation under s 424A(1)(a) of the Act because it fails to alert him with sufficient specificity to the adverse material on which it ultimately relied, in part, to reject his claim. The reference to the appellant's "profile as a leader and activist in Burma" does not unambiguously draw his attention to the view that he "was known as an Indian leader of the demonstrations". The profile claimed by the appellant was much broader in its reach ("an active and prominent political dissident and pro-democracy activist, as well as having pro-Western sympathies."). Moreover, the wording employed by the Tribunal lacks the necessary clarity. It is open to the construction that it is referring to an increase in the appellant's profile in Burma in the period between his arrival in Australia in March 2004 and the hearing before the Tribunal on 19 December 2005. The Tribunal does not make it clear that the point of its concern is that the appellant's claims had appeared to it to have changed in Australia in that period. The appellant's response to the Tribunal's request to comment on this item of information led to a denial that his profile had increased "in the way suggested". It does not appear that the appellant and his advisors understood that the Tribunal was directing particular attention to the claim that he was perceived to be "an Indian leader". 21 Although the point was not raised or relied on by the appellant, I would also express my doubt that the Tribunal satisfied its obligations to the appellant under s 424A(1)(b) of the Act . The Tribunal advised the appellant that the reason that the information identified in its letter of 23 January 2006, "is relevant [is] because it indicates some inconsistent account in relation to these aspects of your claims and evidence at different stages of the proceedings. " Such a statement was apt to mislead if it was intended to refer to alleged inconsistencies between what the appellant said at the time at which he applied for a protection visa and what he told the Tribunal in written submissions and orally. No "proceeding" was extant at the time of the original application. 22 The respondent Minister contends that, even if the Tribunal has failed to meet its obligations under s 424A of the Act , it should be held that it was, in any event, not obliged to comply with s 424A(1) because it was relieved of that obligation, in respect of the relevant item of information, by the terms of s 424A(3)(b). That provision stipulates that s 424A(1) does not apply to information "... that the applicant gave for the purpose of the application ..." The question then becomes one of identification: precisely what information was given by a particular applicant to the Tribunal that the Tribunal considers would be the reason or part of the reason for affirming the decision under review? The relevant application is the application to the Tribunal not the earlier application for a protection visa: see SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCAFC 2 ; (2006) 150 FCR 214. One can readily understand the purpose of a provision such as s 424A(3)(b) where an applicant has given the Tribunal information which is adverse to his or her interests. It is not as readily apparent that such an exemption is intended to apply in circumstances in which the Tribunal determines that it does not accept such a claim and proposes to reject it. 23 In NBKT v Minister for Immigration and Multicultural Affairs [2006] FCAFC 195 ; (2006) 156 FCR 419 at 435 Young J (with whom Gyles and Stone JJ agreed) drew attention to "the importance of giving careful consideration to the nature of the information that is said to fall within s 424A(3)(b) and the circumstances in which it is communicated to, or elicited by, the Tribunal. This is particularly so when, as the Tribunal seems to have done here, it treats the omission as though it provides implicit support for a positive assertion that is detrimental to an applicant's case. It makes no difference whether the omission is to be found in a prior statement of an applicant or, as in this case, in a statement provided by a third party. 24 It is clear in the present case that the appellant "gave" the Tribunal the relevant information to the extent that he made the claims relating to his profile, referred to above at [19], in written submissions. He thereby expressly relied on the information and invited the Tribunal to have regard to it: see M55 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 131 at [25] . The more significant issue for present purposes is whether the appellant also "gave" the information that he had not made the relevant claims at the time at which he originally applied for a protection visa. In my view he did give this information to the Tribunal. It is implicit in the declaration which he made on 14 December 2005 which is quoted above at [19], when he says, immediately before the reference to his profile as "the Indian leader" that this was information which he wished "to add by way of clarification. " The omission was expressly acknowledged on a number of occasions during his interview with the Tribunal. In his oral evidence the appellant told the Tribunal about the events in September 1987 in which he said he was identified as "the Indian leader". The Tribunal member raised the question of whether this claim had earlier been made. The appellant's legal representative drew attention to the passage in the appellant's statutory declaration of 14 December 2005 which is quoted above at [19]. I know that, but it wasn't in your original document that people were gathering at your house and they were calling you an Indian and gathering at the Indian's house, and I am wondering why. I didn't have that open to me. I didn't have the time for the situation that allowed me to do so. That's why I had to change solicitor. This is very important evidence for you to have provided at the time. The three brothers --- the three of us were there. We were doing everything hurriedly until I got to see Mr Manne (in distinct) I've already made the information to you. 25 The appellant "gave" the Tribunal the information relating to his claimed profile as an Indian leader and the information that he had not referred to this claim in his earlier dealings with the department. This omission was one of the reasons advanced by the Tribunal for rejecting the appellant's evidence that he was known as an Indian leader and that demonstrators had gathered at his house. The Federal Magistrate was, therefore, in my opinion, correct to hold that s 424A did not apply because the relevant "information" was information of the kind comprehended by s 424A(3)(b). 26 After the foregoing reasons had been prepared counsel for the appellant sought and obtained leave to file further written submissions because of the publication of reasons in two other cases. The reasons had been published after I had reserved judgment in the present proceeding. The two cases were the decision of Rares J in SZEOP v Minister for Immigration and Citizenship [2007] FCA 807 and that of Kenny J in MZXFQ v Minister for Immigration and Citizenship [2007] FCA 826. Written submissions in reply were also filed by counsel for the Minister pursuant to leave. 27 In SZEOP the central issue was whether the Tribunal had satisfied its obligations under s 424A(1) of the Act . The Tribunal had determined that the appellant's delay in making a claim for a protection visa once he had arrived in Australia was a reason for concluding that he had fabricated a claim to being homosexual. The Tribunal had sent a letter to the appellant under s 424A(1) in which it invited comment on the proposition that: "Your delay in applying for Australia's protection is relevant because it casts doubt on the genuineness, or at least the depth, for your claimed fear of being persecuted if you return to Bangladesh. " Rares J held that this invitation was insufficiently precise: it "did not include any suggestion that the appellant's claim to be a homosexual would be positively disbelieved as a fabrication because he had delayed in making his protection visa application": at [35]. There is nothing in his Honour's reasons which causes me to depart from my conclusion that the Tribunal, in the present case, failed to meet its obligations to the appellant under s 424A(1). Indeed, his Honour's reemphasis of the need for sufficient specificity in s 424A letters in entirely consistent with the views which I have expressed. 28 One of the issues in MZXFQ related to the application of s 424A(3)(b) in circumstances in which the appellant had given oral evidence before the Tribunal in which he confirmed, at the invitation of the Tribunal, that his previous written statements were accurate. He had also lodged with the Tribunal a statutory declaration in which he made reference to his initial statement in support of his protection visa application. The Minister argued that, in these ways, the appellant had republished to the Tribunal information which had been made in his initial statement. Her Honour rejected this submission. I would reject the contention that the appellant "gave" the whole of his initial statement to the Tribunal, when, in answer to the Tribunal's question, he confirmed with the Tribunal that he did not wish to amend it or his 2005 statutory declaration. ... I would also reject the contention that, because of the terms of his 2005 statutory declaration, he "gave" the information in his initial statement to the Tribunal for the purposes of its review. His affirmation that, whilst his initial statement was "correct and true" he sought to provide the Tribunal with "extra details" in the 2005 statutory declaration did two things. It affirmed that his claims had not altered over time and that there were more particulars he could give in relation to them. In and of itself this did not republish the initial statement to the Tribunal. There is, moreover, nothing else in the 2005 statutory declaration or in the circumstances of the case that would give rise to the implication that the initial statement had been republished to the Tribunal. On the contrary, the terms of the 2005 statutory declaration indicate that it was intended to take the place of the initial statement as a fuller embodiment of the applicant's claims than the initial statement. Despite reference to the initial statement, the statutory declaration plainly stood by itself. It did not require the reader to refer to the earlier document in order to understand its contents. There is no doubt, in my opinion, for the reasons which I have given in para [24] above that the appellant "gave" the Tribunal the information that he had not previously made the relevant claim. This case did not involve an alleged republication of the whole of the appellant's initial statement. Moreover it did not involve a mere assertion that what had been said in the initial statement was true and correct. The Tribunal was told that the claim had not been made in the initial statement and given the reasons why that was so. Accordingly, in my opinion, the decision of her Honour does not assist the appellant in this case. 30 The appeal should be dismissed with costs. I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY. | appeal from federal magistrate affirming decision of refugee review tribunal claim not raised in initial application subsequently raised before tribunal where tribunal failed to alert appellant with sufficient specificity to the adverse material on which it relied where tribunal failed to meet its obligations to appellant under s 424a(1) of migration act demonstrated compliance with s 424a(3)(b) relieves the respondent of the requirements set out under s 424a(1) no appellable error made out migration |
The Chief Justice has made a direction that the appeal be heard by a single Judge of the Court under s 25(1A) of the Federal Court of Australia Act 1976 (Cth). 2 The amended creditors' petition filed by Mr and Mrs Sfar (the respondents) claimed the amount of $4,684.68 for costs that had been ordered against Mr Totev in the District Court of New South Wales, for which sum judgment had been entered in the Local Court of New South Wales on 15 July 2004. Interest was also claimed for 69 days at 9%, amounting to $79.70. The total sum referred to in the creditors petition unpaid was $4,764.38. 3 The bankruptcy notice had been sought to be set aside by Mr Totev by application filed on 22 September 2004. That application was one contemplated by s 41(7) of the Bankruptcy Act 1966 (Cth) (the "Act"). That application, however, was filed after the commission of the relevant act of bankruptcy. A Federal Magistrate (Raphael FM) dismissed the application on 26 November 2004. There is no appeal before the Court in relation to those orders, though it will be necessary to comment on one aspect of the reasons of the Federal Magistrate in due course. 4 The creditors' petition was served on 19 December 2004. An amended creditors' petition was served on 30 March 2005. 5 On 10 May 2005, a Registrar made a sequestration order against the estate of Mr Totev. 6 The circumstances leading up to the act of bankruptcy arise from a proceeding in the District Court of New South Wales in which Mr Totev and the Sfars were involved. Mr Totev sued the Sfars for damages for misleading conduct and losses in connection with a loan arrangement. 7 For present purposes, it is adequate to begin a closer examination of events from the hearing in the District Court on 2 June 2003 before Rolfe DCJ. On that day, Mr Totev's matter was set down for hearing. The matter was called on. Mr Totev was not ready to proceed. It appears that Mr Totev's solicitors ceased to act for him less than a month before. Mr Totev asked for an adjournment. Rolfe DCJ indicated that he would give an adjournment, but that Mr Totev would have to pay the costs thrown away. The matter was stood over to 18 August 2003 with the plaintiff to show cause as to why the proceedings should not be dismissed for want of prosecution. The matter was later before the Court in November 2003. The proceedings were not dismissed on this or any other basis. 9 The costs were assessed. After an earlier Certificate of Determination was lodged with the Local Court, the relevant cost assessor's Certificate of Determination was lodged with Fairfield Local Court and a Certificate of Judgment in the sum of $4,684.68 was issued on 15 July 2004. The bankruptcy notice was issued on the basis of this judgment representing an order for costs in the District Court of New South Wales. He made reference to the District Court proceedings and some Supreme Court proceedings for the recovery of $7,600. (b) Secondly, he claimed that he was seeking to set aside the judgment in the Local Court. (c) Thirdly, he took issue with how Rolfe DCJ had expressed himself as to the payment of the costs. (d) Fourthly, he referred to a settlement offer made in connection with the District Court proceedings as being greater than the judgment debt. (e) Fifthly, he claimed that there had to be proof that the Sfars had paid their lawyers before they could recover a judgment against him. (f) Sixthly, he referred to a "two-fold malversation" of justice including an assertion that the judgment would somehow abort the District Court proceedings. On 20 April 2005, Master Malpass described the appeal from the Cost Assessment Review Panel as misconceived and hopeless. 12 On 10 May 2005, the Registrar made the sequestration order. 13 On 31 May 2005, Mr Totev filed an application for review. This was heard by the Federal Magistrate (Driver FM) on 5 July 2005. Orders were made on that day dismissing the application for review with costs. 14 The application before the Federal Magistrates Court was supported by an affidavit of Mr Totev of 20 June 2005, being 134 pages long (including annexures). An affidavit of Michael Sfar of 4 July 2005 was also before the Court. 15 Before dealing with the contents of that evidence and the submissions on appeal it is necessary to describe how the Federal Magistrate dealt with the review. 16 The Federal Magistrate received Mr Totev's affidavit over the objection of counsel for the Sfars. I also received as submissions a document filed in Court by Mr Totev earlier today headed, "Evidence my Complaint to the Legal Services Commissioner is a Genuine Claim". In the course of argument, Mr Totev tendered a further document, being a letter to the petitioning creditors from their then solicitors dated 9 August 2002, which became exhibit A1. 18 The Federal Magistrate first rejected the assertion that the sequestration order should not have been made on formal grounds. The material presented to the Registrar was sufficient on its face, he said, to support the making of a sequestration order. No argument or ground of appeal was put to me as to any error in this regard. 19 The Federal Magistrate then dealt with the submission that he should go behind the judgment debt. He refused to do so on the basis that it was an order for costs made in the District Court that had been assessed. The District Court made a costs order against Mr Totev and it was his liability to pay it, not a liability on the petitioning creditors to pay the solicitors. There is no substance to that argument essentially because the costs order supporting the bankruptcy notice and the creditor's petition was made in the proceedings instituted by Mr Totev in the District Court, which are the very proceedings which, he says, constitute his counter-claim, set off or cross-demand. Not only could that counter-claim, set off or cross-demand be asserted in the proceedings leading to the costs order. It was those proceedings that led to the costs order. Neither could it be a proper basis of opposition to the creditor's petition on the basis of there being a counter-claim, set off or cross-demand of equal or greater value. Mr Sfar, in his own affidavit, in paragraph 16, suggests that he and his wife are anxious to see an end to those District Court proceedings and that the bankruptcy proceedings appeared to be the only means open to them to achieve an end. I also have before me evidence of discussion between the parties seeking to resolve the District Court proceedings short of a bankruptcy. However, the motivation of a petitioning creditor is not generally relevant. An act of bankruptcy had been committed. That act of bankruptcy having been committed and a creditor's petition verified by required affidavits having been presented then, prima facie, the petitioning creditors were entitled to the relief they sought. In those circumstances, an argument could be raised that the bankruptcy proceedings were an attempt to frustrate the administration of justice. In this case, however, there is no material of a persuasive nature that the District Court proceedings have any prospect of success. The trustee has not yet been able to determine whether those proceedings are worth pursuing. Although proofs of debt have not yet been lodged, the identified creditors include a range of financial institutions, the Australian Taxation Office, solicitors who formerly acted for Mr Totev, the Supreme Court of New South Wales and a Lugo Ventresca, who apparently loaned $25,000 to Mr Totev to support his legal proceedings. If there is any merit in the District Court proceedings, then it is by no means beyond the bounds of possibility that one or other of Mr Totev's creditors will see some benefit in funding the continuation of those proceedings by Mr Totev's trustee in bankruptcy. The bankruptcy operates as an effective stay on the District Court proceedings until the position can be properly assessed by the trustee. That is a normal and natural consequence of the sequestration order, as was pointed out by Mr Potts in his submissions. There is no necessary consequence of concern by reference to any asserted abuse of process. Some cognisable error needs to be identified in the decision appealed from. See Qun Xiong (Kenny) Yu v Todaytech Distribution Pty Ltd [2006] FCA 131 at [30] . His Honour Driver FM erred by not giving sufficient weight if any at all to the relevance of my existent claim against the creditors in the District Court No 14079 of 2001 as a counter-claim, set off or cross demand and which puts in dispute my liability to the creditor. His Honour Driver FM erred by not sufficiently investigating the merits of my claim in the District Court against the creditors. That his Honour Driver FM did not sufficiently look into my claim and investigate what it entailed and whether it had any probability of success based on these factors. That subsequently his Honour Driver FM concluded that "there is no material of a persuasive nature" but did not elaborate further and noted that the trustee had not been able to determine whether my claim in the District Court is worth pursing (trustee is waiting for money payment prior to determining whether or not to pursue the action). His Honour Driver FM erred because in determining its prospects of success he did not sufficiently investigate the claim's merits or the written arguments tendered. None of the other creditors were applying any pressure on me or sought any action against me. His Honour Driver FM erred in not using his discretionary powers to investigate the merits of this claim. In these circumstances there is dispute over my liability to the creditors in the bankruptcy proceedings and subsequently the sequestration order of 10 th May 2005 against me should not of been made. I am filing a claim against the respondents and their legal representatives in the form of a complaint to the Legal Services Commissioner who can award up to $10,000 damages. This claim if successful is greater than the judgement debt and also puts in dispute by liability to the creditor. No money was expended and no financial loss was incurred by the creditors on the judgement debt at any point in time. No real debt in truth and reality has been incurred by the creditors. The creditors allegedly have incurred substantial costs in pursuing the bankruptcy proceedings that are far greater than the judgement debt. The predominant purpose of the bankruptcy proceedings were to frustrate and discontinue my claim against the creditors in the District Court where the creditors stand to lose far more money in damages and the bankruptcy proceedings acted as a stalking horse to coerce me into discontinuing my action. These provide a convenient framework for analysis. 26 The first argument was that the Federal Magistrate should have gone behind the judgment based on the principle in Wren v Mahoney [1972] HCA 5 ; (1971-72) 126 CLR 212. The Federal Magistrate, it was said, committed an error because on the material before him he should have concluded that in truth there was no costs debt lying behind the costs judgment and, therefore, he should have dismissed the petition on the basis that no debt was truly owed. (See ground F and ground J in the Notice of Appeal. (See grounds A, B and H in the Notice of Appeal. This was really part of the second argument, and I will treat it as such. 29 The fourth argument was that on the material before the Federal Magistrate he should have concluded that the bankruptcy proceeding was an abuse of process or something akin to an abuse of process to warrant the exercise of a discretion to dismiss the petition. (See grounds C and K of the Notice of Appeal. The LSC can award up to $10,000 in a complaint, if upheld. If an award were made in favour of Mr Totev against the barrister, that would mitigate the costs debt. (See grounds G and I of the Notice of Appeal. The order for costs created a liability. It was an order not set aside. There was no evidence that the solicitors were acting pro bono or for no fee or that the material placed before the assessor did not involve legal costs. The order for costs of itself founded a judgment. Its enforcement was not conditional upon the petitioning creditors proving the relationship between them and their legal advisers. There was no error in refusing to go behind the judgment debt. It is plain that this is what was argued below. It is not correct. 34 The claim of Mr Totev against the Sfars was a consideration to be taken into account in the decision to make or to refuse to make a sequestration order under s 52 of the Act. His reasons (at [8] and [9] set out above) explain why, in his view, the claim was not a counter-claim, set off or cross demand that Mr Totev could not have set up in the action or proceeding in which the judgment or order was obtained. This was an issue for the application under s 41 about the satisfaction of s 40(1)(g). The views expressed by the Federal Magistrate were ones that had been expressed by Raphael FM in the latter's reasons for judgment on the application made by Mr Totev to set aside the bankruptcy notice. The Federal Magistrate then stated (without any reasons) that the same applied in the context of opposition to the creditors' petition. 36 It will be necessary, in due course, to say something about the conclusion of the Federal Magistrate concerning s 40(1)(g). Before that, it is necessary to show only that his Honour's conclusion that Mr Totev's District Court claim was irrelevant to his opposition to the creditors' petition was incorrect. 37 On proof of the matters in s 52(1) of the Act, the Court will generally proceed to make an order for sequestration. It is for the debtor to persuade the Court that the public interest in the dealing with the insolvent debtor and the rights of individual creditors are outweighed by other considerations: Cain v Whyte [1933] HCA 6 ; (1933) 48 CLR 639 at 645-6 and 648. In Cain v Whyte , the judgment of Henchman J sitting as the judge in bankruptcy for the District of Southern Queensland was approved by Rich, Starke, Dixon, Evatt and McTiernan JJ. He suggests that in the present case "other sufficient cause" exists, within the meaning of sec. 56 (3) (b), which throws upon me an obligation to dismiss, or gives me a discretion to dismiss, the petition. I agree that the sections do leave a certain amount of discretion in the Bankruptcy Judge (see secs. 54, 56 (2) and 56 (3)), and I do not agree with the argument put forward by Mr. Graham that the words "other sufficient cause" should be limited to the one case where the Court is satisfied that the petition is put forward solely for some collateral illegitimate end, and not for the purpose of securing the equal distribution of the available assets amongst the creditors. To my mind, the High Court of Australia did not intend to put a limit on the meaning of the words "other sufficient cause" in Dowling v. Colonial Mutual Life Assurance Society [1915] HCA 56 ; (1915) 20 CLR 509, and I do not propose to be the first to say that such wide words as "other sufficient cause" are necessarily limited to meaning a cause in the nature of fraud or abuse of the provisions of the bankruptcy law. I can well conceive that "other sufficient cause" might arise in connection with any particular case. To my mind, it is the duty of the Bankruptcy Judge to examine in each case, if the question is raised, whether there is other sufficient cause than the fact that the debtor is able to pay his debts in full, for refusing to make an order. I approach that question with the full appreciation that, prima facie, on proof of the matters mentioned in sec. 56 (2), the Court will proceed to make an order for sequestration, and that it is for the debtor to show some cause overriding the interest of the public in the stopping of unremunerative trading, and the rights of individual creditors who are unable to get their debts paid to them as they become due. Something has to be put before the Court to outweigh those considerations before it can be said that sufficient cause is shown against the making of a sequestration order. At the same time it points to a fundamental limitation imposed by the nature of the jurisdiction in bankruptcy, which requires the Court to keep in mind, not only the interests of the individual parties before it in the particular case, but also the public interest, which may be adversely affected by the propping up of insolvency. However, in the present case that factor does not provide the bar to an exercise of discretion in the debtor's favour that it would provide in many cases, since the debtor has a paucity of creditors, other than the petitioning creditor, who would be likely to have any reason for concern. Of course, that merely removes a bar; it does not provide a positive ground constituting "other sufficient cause" why a sequestration order ought not to be made. A claim sounding in money by the debtor against the petitioning creditor may amount to such other sufficient cause. The matter was examined by the Full court in Ling v Enrobook Pty Ltd (1997) 74 FCR 19. At 25-26, after referring to Cain v Whyte, the Full Court referred to the relevant authorities (in particular Re Schmidt; Ex parte Anglewood Pty Ltd (1968) 13 FLR 111 at 115-116 per Gibbs J, sitting in bankruptcy) and stated the principles. Despite the length of the passage it is appropriate to set it out. The circumstance that the legitimate claim of the debtor is one against the judgment creditor is likely to be a significant circumstance for the purposes of s 52(2)(b). The question immediately arises whether I should proceed to determine the existence and extent of the debtor's alleged claim. The position is different from that which arose in relation to his claim that the trucks were sold at an undervalue. In that regard any sum which the mortgagee was entitled to have brought to its credit as the amount which was realised, or ought to have been realised, on the scale [sic] of the mortgaged property must also be allowed to the credit of the debtor as surety, thus pro tanto reducing the amount of his indebtedness. It was therefore necessary to determine in this Court the questions that arose in relation to that aspect of the matter. Where, however, the debtor claims to be entitled to unliquidated damages in tort against the petitioning creditor the position seems to me to be different. As a general rule this Court is not an appropriate forum to decide such a claim and is limited to forming a view as to whether it appears that there is sufficient validity in the debtor's claims to justify a dismissal or adjournment of the petition ... Considerable evidence directed to this issue has been given before me and it seems to me that I ought to consider this evidence for the purpose of deciding only whether it is probable that the debtor has against the petitioning creditor a claim which is likely to succeed. If I am satisfied that the debtor has a claim against the petitioning creditor equal to or exceeding the amount of the judgment debt, I should not make a sequestration order. If, however, it appears that the debtor has a claim which is less than the amount of the petitioning creditor's judgment debt, the proper course would seem to be to require the debtor, if he desires to avoid a sequestration order, to pay the difference between the amount of the judgment debt and the amount which it seems probable to me that he will recover in the proceedings against the petitioning creditor. In many cases it would be more convenient, assuming that the debtor showed that he had a real claim to litigate, to adjourn the proceedings to enable his claim to be tried in the ordinary courts, but that course was not taken in the present case, partly because the existence of any valid claim was vigorously denied by the petitioning creditor and partly because the proceedings in the Supreme Court have been somewhat dilatory. The public interest recognised by such authorities is that which, in broad terms, is reflected also in s 40(1)(g) of the Act; that is, that a sequestration order ought only to be made on the basis of an indebtedness which is not counterbalanced by a claim by the debtor against the petitioning creditor. Such authorities provide no comfort to a debtor who asserts a claim, not against his or her creditor, but against a third party. But the authorities do not suggest that it is in the public interest to allow insolvent debtors to prosecute litigation generally. They only recognise that it is not in the public interest for a debtor to be forced into bankruptcy by reason of a state of insolvency likely to be of only short duration. It seems to me that Gibbs J has distinguished between a claim of the debtor against the petitioning creditor that is likely to succeed (which would justify the Court refusing to make a sequestration order) and the existence of a "real claim" which presumably the Court has been unable to classify as one that is likely to succeed, but nevertheless is thought to have sufficient integrity to warrant the debtor being given an opportunity to have it litigated. In such a case Gibbs J thought that it would be appropriate to adjourn the petition pending resolution of the litigation. When, therefore, an insolvent debtor, in order to demonstrate " sufficient cause ", relies upon the existence of a monetary claim against the petitioning creditor which the debtor alleges means (leaving out of account the debtor´s possible bankruptcy) that the debtor´s state of insolvency is likely to be of only short duration, an assessment of that claim must be made in order to determine whether it is likely to terminate shortly the debtor´s state of insolvency. That assessment will involve a consideration of the strength of that claim on liability, the strength of that claim on quantum and the stage, if any, which the prosecution of that claim has reached. If, after consideration of those matters, an assessment is made that (leaving out of account the debtor´s possible bankruptcy) the existence of that monetary claim against the petitioning creditor means that the debtor´s state of insolvency is likely to be of only short duration, then the existence of that claim may amount to " sufficient cause " why a sequestration order ought not to be made. It is for the debtor to establish the existence of `sufficient cause´: Cain v Whyte [1933] HCA 6 ; (1933) 48 CLR 639 at 645-646; Ling at 24. He must establish that he has a real claim against the creditor that is likely to succeed. If the Court is satisfied that there is such a claim, and that its quantum is likely to equal or exceed the creditor´s claim, it will not make a sequestration order. If the claim is likely to be less than the creditor´s claim, the Court will require the debtor, if he is to avoid a sequestration order, to pay the difference between the judgment debt and the amount he is likely to recover on his claim. See Re Player (1962) 19 ABC 277 at 282; Re Schmidt; Ex parte Anglewood Pty Ltd (1968) 13 FLR 111 at 115-116; Ling at 25-26; Commonwealth Bank v McDonald [1999] FCA 984. A debtor does not establish a real claim that is likely to succeed merely by producing a statement of claim in an action against the creditor: Re Rivett; Ex parte Edward Fay Ltd (1932) 5 ABC 182; Player at 282, or by pointing to the existence of current litigation against the creditor: cf Re Douglas Griggs Engineering Ltd [1963] 1 Ch 19 at 23. While the Court does not try the cross-claim in advance, the debtor must adduce sufficient evidence to show that it is a real claim which is likely to succeed: cf Vogwell v Vogwell (1939) 11 ABC 83 at 88; Player at 282. Nevertheless, what is clear is that the fact that there has been an act of bankruptcy does not make the claim by the debtor against the petitioning creditor irrelevant. It should be examined to assess whether it can be said that there is sufficient evidence to show that it is a real claim which is likely to succeed. Also relevant is the stage of the litigation, the length of time for its vindication and any other relevant matters. It goes without saying that solvency is a relevant consideration. In some circumstances, it may be difficult to assess the likelihood of success of the debtor's claim. All the authorities show that central to the showing of "other sufficient cause" for the purposes of s 52(2)(b) is the question of the prospects of success. The case is not tried in the bankruptcy court, but the material is examined for the purpose alluded to by Gibbs J in Re Schmidt . As Olney J identified in Re James, if a likelihood of success can be demonstrated, that may justify a refusal of a sequestration order. Alternatively, the circumstances may reveal a claim of a character and nature in which likelihood of success cannot be predicted with accuracy but in the circumstances the petition should be dismissed or an adjournment of the petition should granted: see the approach of Sundberg J in Ling v Commonwealth (1996) 68 FCR 180 at 195-196, with which Wilcox J and Whitlam J agreed. If the claim is one in which credit of witnesses will be involved, and a debtor sets out the nature and detail of the case and all his or her evidence the debtor may only be able to persuade the bankruptcy court that, if relevant criteria are believed, he or she has good prospects of success. What should be proved, or what is sufficient to be proved, in any given case will depend upon the circumstances. The context in which the issue arises is also important. The discretion involved in s 52(2)(b) is a broad one, and, importantly, it is informed by public interest considerations concerned with the dealing with insolvents. It is to be distinguished from the task involved in deciding whether a claim exists that satisfied s 40(1)(g) of the Act. There, the task, prior to the commission of an act of bankruptcy, is the identification of a bona fide or genuine claim: Ebert v Union Trustee Co of Australia Ltd [1960] HCA 50 ; (1960) 104 CLR 346; Re Brink; Ex parte Commercial Banking Co of Sydney Ltd (1980) 44 FLR 135; Vogwell v Vogwell (1939) 11 ABC 83. In Brink Lockhart J treated (at 141) the reference to a "prima facie case" in Ebert as a reference to "a fair chance of success". But, clearly, the application of the criteria above requires the Court to make some kind of preliminary assessment, though obviously not to determine the counter-claim, set-off or cross demand finally. Accordingly, evidence tendered on an application to set aside is to be tested for admissibility, not as if the proceeding were one in which the debtor's claim was being finally determined, but by reference to the question whether the Court should be satisfied that the debtor has a claim deserving to be finally determined. That was to misunderstand the nature of the task at hand. The context was different. There had been an act of bankruptcy and the question was whether "other sufficient cause" had been shown. The cases to which I have referred reveal the principles to be applied in that respect. 46 How the question of "other sufficient cause" should have been approached here might well have been seen to be partly conditioned by the view one takes of s 40(1)(g) and the District Court claim. The Federal Magistrate said that Mr Totev's was not a counter claim, set off or cross demand which could not have been set up on the proceedings in which the judgment or order was obtained since the costs order was obtained in those very proceedings: the District Court proceedings. That, it seems to me, is a debateable proposition. The purpose of this part of s 40(1)(g) is well known. Conversely, however, the debtor could not challenge the bankruptcy notice if the debtor could have brought the counterclaim in a timely way at the same time as the proceedings brought against him, but failed to do so. The section could on its face have no application if the debtor had brought the counterclaim in the proceedings and was either successful or unsuccessful with that counterclaim. Plainly Mr Totev, both as a matter of law and practicality, could not bring the main claim (yet to be heard) into the assessment of costs. 48 Another way of approaching the matter may be to view the relevant "proceeding" as that part of the action dealing with the assessment, certification and obtaining of the Local Court judgment on costs: cf Chen v Bannerman [2001] FCA 160 ; Amos v Lillyman Whitlam J 1 July 1998 unreported; Re Black; Ex parte Jeffery (1932) 4 ABC 157; and Opie v Opie [1951] HCA 47 ; (1951) 84 CLR 362, 371-72. Section 40 (3) may also affect the issue, in particular s 40(3)(b). 49 If in fact this was a claim that fell within s 40(1)(g), that is as one that could not be set up in the action or proceeding, it may be that a relevant consideration in the assessment of "other sufficient cause" for s 52(2)(b) is the fact that Mr Totev may be seen to have had an answer to the bankruptcy notice but only lost that by a delay of a day or two. Such an approach may ameliorate the stringency of the approach to s 52(2)(b) that might be seen to be otherwise called for by authorities such as Ling v Enrobook. Alternatively, if the Federal Magistrate was correct to say that the claim could not satisfy s 40(1)(g), that matter, and the recognition that the claim could not in fact have possibly been litigated to defeat the costs order, could likewise ameliorate the stringency of the approach to s 52(2)(b). 50 None of these matters was addressed before me or the Federal Magistrate. Section 52(2)(b) was not addressed by the Federal Magistrate. The possible relevance of the claim was not broached in the context of s 52(2)(b). As I will discuss in a moment, the Federal Magistrate did, however, deal with the prospects of success of the claim. 51 Thus, the Federal Magistrate approached the matter without directing himself to the correct framework of analysis under s 52(2)(b). Whether that error was operative is another question in the light of his conclusion at [12] of his reasons that there was no material of a persuasive nature before him that the claims had any prospects of success. This is the only way that my wife the Second Respondent herein and I can protect ourselves against the mountain of costs the Applicant is forcing us to expend and which the Applicant does not have the ability to pay. Central is the requirement that the party who has instituted proceedings has done so for a purpose, or to effect an object, beyond that which the legal process offers. 54 Mr Totev argued that [16] of Mr Sfar's affidavit reveals that. I disagree. First, Mr Sfar was only referring to upholding the sequestration order. Secondly, the hope and expectation of the Sfars might well be to see the litigation in the hands of the trustee. A trustee would be obliged to act according to the duties of his or her office in dealing with the debtor's property. Their purpose can be seen to be to have the insolvency regime (including the appointment of a trustee to take possession and control of the bankrupt's property --- relevantly here, the litigation) apply to someone they thought to be insolvent. 55 Mr Totev identified the purposes of bankruptcy only as to protect debtors and to protect creditors from fraudulent conduct by debtors of their affairs. That is too limited a view. The Sfars had an order for costs. It was not met. It was available to found a bankruptcy notice. That notice was not met. There is no evidence of solvency of Mr Totev. There is no evidence to suggest that the Sfars wanted other than to invoke the Act and make Mr Totev bankrupt to obtain a state of affairs conformable with his apparent insolvent status. That they thought or hoped that this would see an end to the litigation is not an abuse of process. The decision about Mr Totev's claim would be made by the trustee within the regime which they were pursuing. 56 Mr Totev submitted that because the bankruptcy proceeding was not commenced to recover the debt, it was an abuse. I reject this submission. It inverts what is the usual approach to the use of bankruptcy proceedings to put pressure on a party to extract a debt: Brunninghausen v Glavanics [1998] FCA 230. 57 The Federal Magistrate was correct to conclude that there was no abuse of process, though I should not be taken to agree with all that he said about what would in other circumstances amount to an abuse of process. 58 In the context of discussing the claim that the bankruptcy proceeding was an abuse of process, the Federal Magistrate concluded that there was no material of a persuasive nature that the District Court proceedings had any prospect of success. If this were a clearly defensible proposition the error in approach earlier discussed of failing to advert to s 52(2)(b) and the related principles may be seen not to be operative. All the cases on s 52(2)(b) are clear that for a claim by the debtor against the creditors to amount to "other sufficient cause" it cannot be one which is without any prospects of success or in respect of which no material has been put forward revealing any prospect of success. Thus, it is essential to assess whether it was open to the Federal Magistrate to conclude as he did in this regard. 59 Mr Totev's affidavit began with a body of submissions as to why the Registrar erred. In particular, submissions were put to the effect that a sufficiently genuine claim had been demonstrated. 60 Before turning to the task of seeking to substantiate his District Court claim, Mr Totev exhibited a letter from his former counsel to his former solicitors explaining why counsel returned his brief (in April 2003). Counsel complained of no assistance from the solicitor in the preparation of what he saw as a complex and difficult commercial cause. Though the letter reflected a view that there were some evidentiary difficulties, it did not at any point damn the case as hopeless. 61 Mr Totev then turned to the justification of his District Court claim. From a reading of the whole of Mr Totev's affidavit and its exhibits it can be seen that he approached his task as only requiring the genuineness of the claim to be shown by reference principally to authorities concerned with s 40(1)(g). My grounds are set out in the document entitled "Evidence my action is a genuine Claim". He was a litigant in person. He was seeking to show the genuineness of his claim. He misunderstood the relevant question --- positing as he did the question as to whether s 40(1)(g) was satisfied, rather than the correct question as to whether he had demonstrated "other sufficient cause" for the purposes of s 52(2)(b). That misunderstanding may well explain why he did not go further and seek to prove expressly the underlying facts in the District Court claim. The second sentence of [16] was, however, an assertion by Mr Totev that Ex V7 contained his "grounds". That can be read as Mr Totev seeking to say that Ex V 7 not only reflected his District Court case, but was a true basis for it. 63 Taken together, Exhibits V7 to V20 disclose a tolerably coherent case that representations were made to him by or on behalf of the Sfars which were misleading, deceptive and fraudulent to the effect that loan funds of a certain character and amount would be available if he contributed certain funds; and, in reliance upon those representations, he sold a development in Sydney out of which funds he paid the Sfars a fee, paid the Sfars money to fund the arrangement and funded a trip to Spain in connection with the proposed development for which the loan was sought. The loan funds did not eventuate and he lost the use of the funds (over $16,000) which he paid the Sfars and lost the benefit of the profits (said to be $500,000) from the development he sold, all, he said, in reliance on their representations. 64 The above is to a degree incomplete. The exhibits to Mr Totev's affidavit are not a pellucid example of legal drafting. But they reveal a real case. There was no material upon which one could gauge the loss of profits claim. However taken as a whole one can see a coherent case. Plainly many of the allegations were contested. One can anticipate significant factual issues and credit issues. Even if Mr Totev swore expressly to the truth of all the statements of fact in Exhibit V7 to V20, it would be impossible for a bankruptcy court to conclude how good the case was. 65 However, I do not see how it can be said that there was no material of a persuasive nature that the proceedings had any prospects of success. Mr Totev can be seen to be putting all this material forward as the basis for his case, impliedly the truthful basis for his case. Perhaps he should have sworn to the exhibits as he would do in support of a pleading that was verified. Perhaps he should have tendered the witness statements in the proceedings and deposed to the primary facts which he wanted to prove. That certainly would have meant that the court could judge the primary evidence and not the asserted effect of it. He was a litigant in person who had posited the wrong, but at least a relevantly cognate, question. The submissions put against him before the Federal Magistrate, (which appear to have been accepted,) were that the task upon which he was engaged in trying to show the worth of his claim was irrelevant. It was not. In this context, I do not think that the claim should have been dismissed in the way it was by the Federal Magistrate. 66 This being my view about the Federal Magistrate's view about prospects of success, and given that the Federal Magistrate did not address the issues in the correct framework of s 52(2)(b), I cannot conclude that the error of principle in the Federal Magistrate's approach was not operative. I am in the process of preparing documents filing a complaint to Legal Services Commissioner ("LSC complaint") on three grounds. Firstly, the misleading conduct of the respondents' counsel and/or instructing solicitors on 14 November 2003 (same grounds as the summons appeal). Secondly, the abuse of process that the respondents' counsel and/or instructing solicitors in the summons appeal and thirdly, their abuse of process in the bankruptcy proceedings. As the Legal Services Commissioner can award up to $10,000 in damages I assert that the complaint serves as another counter claim as it is genuine and greater than the judgement debt. I do not propose to describe these allegations in detail. They go into the carriage of the claim in the District Court. At the time of the hearing before the Federal Magistrate the claim had not been lodged with the LSC. It was against a third party. It was not clear how the Sfars could be held responsible for the conduct of course, even if it were open to criticism (I make no finding one way or the other as to whether the conduct of counsel was open to criticism). It was not a basis to conclude that Mr Totev was solvent. It plainly was not a matter which amounted to "other sufficient cause". 69 It was understandable that the Federal Magistrate did not deal with the LSC matter separately. It plainly did not raise material to warrant the refusal or adjournment of the petition. It can best be seen to have been dealt with as part of his conclusions that the District Court proceedings had no prospects of success. The Statement of Affairs signed by Mr Totev and in evidence had a number of unsecured creditors, including $23,115.79 owed to the Australian Taxation Office (though disputed). No assets of any relevance were listed. 71 On the evidence Mr Totev appeared to be insolvent. He drew a conclusion about the material that was in my view not open to him and which may have been affected by the failure to address the correct issue. In my view, it could not be said that there was no material of a persuasive nature before the Federal Magistrate that the claim had any prospects of success. 73 The exercise of the power under s 52 miscarried. 74 At the hearing I indicated to the parties that if I were of the view that the exercise of the power miscarried, I would hear the parties on whether I should re-exercise the discretion or send it back to the Federal Magistrates Court. Involved in that issue will be questions of further evidence. 75 I will hear the parties on that issue, but they should work on the basis that I will have to be persuaded away from a view that, sitting in the appellate jurisdiction, in circumstances where further evidence may be sought to be led and where the whole framework of the exercise of discretion miscarried, I should send this back for a hearing to be conducted on the correct principles. The parties should address this issue in writing within seven days. I certify that the preceding seventy-five (75) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. | counter claim against petitioning creditors other claims whether sequestration order should have been made whether bankruptcy proceeding was an abuse of process held that the exercise of power under s 52 of the bankruptcy act miscarried. bankruptcy |
The application challenges a decision of the Migration Review Tribunal ('the MRT'), made on 11 April 2002, affirming a decision of a delegate of the respondent, Minister for Immigration and Multicultural and Indigenous Affairs ('the Minister'), that the appellants were not entitled to the grant of a Family (Residence) (Class AO) visa. 2 Pursuant to s 25(1A) of the Federal Court of Australia Act 1976 (Cth), the Chief Justice directed that the appeal be heard and determined by a single judge. 3 The filed application named only one respondent, the Minister. However, in view of the nature of the proceeding, the MRT should have been named as a respondent. I drew attention to the omission at the commencement of the hearing and, by consent, added the MRT as a second respondent. The MRT took no part in the argument of the appeal. 4 Counsel noted that the appeal to this Court was filed 26 days after the magistrate's decision, outside the prescribed period of 21 days. However, the appellants had applied for an extension of time. Without opposition from the first respondent, I granted leave nunc pro tunc for the notice of appeal to be filed out of time. The father ('Shane Gararth'), the mother and older child were born in Sri Lanka. They arrived in Australia on 14 December 1995. The younger child was born in Australia. 6 On 11 March 1996, Shane Gararth applied to the Department of Immigration Multicultural and Indigenous Affairs ('DIMIA') for a protection visa on the basis that he feared persecution because of his ethnicity and political opinion. That application was refused by a delegate of the Minister. On 17 December 1997, the Refugee Review Tribunal ('RRT') affirmed the delegate's decision. 7 On 6 February 1998, Shane Gararth applied to the then Minister to exercise his discretion under s 417 of the Migration Act 1958 (Cth) ('the Act') to make a more favourable decision than that of the RRT. That application was refused on 1 July 1998. 8 Shortly thereafter, on 31 July 1998, Shane Gararth sought a Family (Residence) (Class AO) visa (a 'special need relative visa'). As at the date of the application, the criteria for the grant of a special need relative visa were those set out in cl 806.21 of the Migration Regulations 1994 (Cth). It is not necessary to refer to all the criteria. Perry Gararth acted as nominator on the application. 11 The application for a special need relative visa was refused by a delegate of the Minister on 4 April 2001. The appellants sought review of that decision by the MRT. On 11 April 2002, after an oral hearing, the MRT handed down a decision affirming the delegate's decision. This is the decision challenged in the present proceeding. I will deal later with the content of the decision and the parties' submissions about it. 12 The appellants did not immediately challenge the MRT's decision. Instead, on 26 April 2002, they applied to the then Minister to exercise his discretion under s 351 and substitute a decision more favourable than that of the MRT. However, while the matter had been pending in the MRT, Shane Gararth had become one of the persons on behalf of whom a class action was being brought in the High Court of Australia. On 15 June 2002, the Minister informed Shane Gararth that, although he had power to intervene in his case, it would be inappropriate for him to do so while the class action was pending. The High Court remitted the class action to this Court. It was finally resolved by an order of Emmett J, made on 20 February 2004, refusing an order nisi. 13 The evidence does not establish whether the Minister ever made a final decision concerning the appellants' s 351 application. Whatever be the position about that, on 18 March 2004, shortly after the appellants became aware of Emmett J's order, they instituted the present proceeding. 14 The proceeding was heard by the learned magistrate on 26 October 2004. On 21 January 2005, he ordered that the proceeding be dismissed. This issue dominated the argument before me. However, counsel for the respondent also argued that, if any jurisdictional error is established, the Court should nonetheless dismiss the proceeding on discretionary grounds, having regard to the delay that occurred between the date of the MRT's decision and the institution of this proceeding. 16 I will discuss each issue separately. Did the MRT fall into jurisdictional error? My wife and I are presently looking after my brother's children my above brother is also very much stressed due to his divorce. My wife and I look after my brother and his two children. My wife takes the children to school and bring them back and she prepares the meals for my brother and his children. We also feed my brother's children wash their clothes and do other work. Both children are attending a Catholic Primary school and are quite a handful. I am also working full time and have been always in employment since arriving in Australia. I am with my current employer for the past eight years. Presently, I am in charge of their Melbourne branch. Our business is the importing and distribution of Oriental Style Foodstuffs. As a result of my work commitments, I am extremely busy and have to work long hours, weekends and also travel to Sydney on a regular basis. There were occasions I was compelled to [go] out and attend to some work related matters after returning home from work. In such a situation, if not for my above brother and his spouse, I could not have left my children with anyone else. If not for all the support I receive from my brother Shane and his family I honestly would not be able to cope with my situation. My brother and his family have been a God sent to me and my two girls under these trying circumstances. Furthermore, being a single father with full time employment I am not left with much time for the housework and also to deal with my children's education. As my brother is unable to get the required help and attention from the Child Care and other organisations, he has no other alternative other then [sic] to rely on me and my spouse to take care of his children. 21 The MRT noted that the 'visa applicant' (Shane Gararth) 'has been nominated by his brother, who is a relative as that term is defined in regulation 1.03 ' and who is an Australian citizen. 22 Under the heading 'The permanent or long-term need for assistance because of death, disability, prolonged illness or other serious circumstances', the MRT said it 'found the nominator and the visa applicant to be open witnesses in relation to their evidence'. The MRT noted there was no claim that the nominator suffered any illness, but that the application had been made on the basis 'that the nominator had a need for assistance because the [nominator] was stressed by his divorce and needed assistance with his family commitments'. 23 Two psychological reports had been submitted to the MRT 'as evidence in support of claims that the nominator needs assistance in caring for his two daughters due to his work commitments'. At paras 30 --- 34 of its decision, the MRT considered whether the claim made by the appellants could constitute 'other serious circumstances' within the meaning of reg 1.03. The nominator has claimed that he has a permanent and long term need for assistance because of "other serious circumstances" in that he requires assistance with household duties and the burden of raising two children. The Federal Court has considered what constitutes "a serious circumstance. " Previously, there had been a line of authority that provided that a special need relative could include a relative whose presence in Australia would benefit their relative (see Fuduche v Minister for Immigration, Local Government and Ethnic Affairs (1993) 45 FCR 515, Moskal v Minister for Immigration, Local Government and Ethnic Affairs (1994) 125 ALR 307 and Vo'ifalelahi v Minister for Immigration, Local Government and Ethnic Affairs (1996) 65 FCR 52). However, this approach has since been overturned by the Full Court in Teo v Minister for Immigration and Ethnic Affairs (1995) 57 FCR 194 and more recent decisions such as Huang v Minister for Immigration and Ethnic Affairs (1996) 71 FCR 95 ['Huang'] and Tuamoheloa v Minister for Immigration and Multicultural Affairs (unreported, Federal Court of Australia, 4 November 1997). In particular, in Tuamoheloa the Federal Court refused to follow the beneficial approach of Fuduche . More recently, in Hussein v Minister for Immigration and Multicultural Affairs [1999] FCA 1621 (5 November 1999) ['Hussein'] Emmett J held that what constitutes "other serious circumstances" must be considered in light of the concepts of death, disability and prolonged illness. In the current case, the nominator claims that he has a need for emotional support from the visa applicant and that his family would suffer if the visa applicant returned to Sri Lanka. The nominator has stated that as a result of his work commitments he cannot care for his children. The Tribunal has also had regard to [Procedures Advice Manual 3 ('PAM3')] , which provides that in the absence of other factors, assistance in bringing up children does not constitute a permanent or long-term need for assistance. The Tribunal accepts that the nominator is required to travel interstate for work related purposes. The evidence is that this occurs approximately once every six to eight weeks, and sometimes twice a month. The Tribunal notes that the nominator is a valued employee who strives to work hard for his employer and that this means that he often works long hours. The Tribunal accepts that the nominator and the visa applicant have a strong and close relationship, which is also applicable to their two families, and that the nominator is more comfortable receiving assistance from the visa applicant. However in light of the case law cited above the Tribunal is not satisfied that this constitutes circumstances of such seriousness as to be similar to death, disability or prolonged illness or "other serious circumstances" within the definition of special need relative. On the evidence presented to it, the Tribunal finds that the nominator does not suffer from any prolonged illness which results in a permanent or long term need for assistance, and that this finding is also applicable to the members of his family unit. The Tribunal also finds that in the absence of other extenuating circumstances, the need for support to care for the nominator's children does not constitute a serious circumstance or a permanent or long-term need requiring substantial and continuing assistance. Further, the Tribunal finds that there are no other serious circumstances affecting the nominator so as to bring the visa applicant within the definition of special need relative. The Tribunal accepts that the visa applicant and his family have been willing and able to provide assistance to the nominator in caring for his children. However, the regulations require that this assistance be of a substantial and continuing nature. As noted above, assistance with the care of children is not regarded, in the absence of other factors, as constituting a permanent or long-term need. The Tribunal finds that, despite his genuine willingness to assist the nominator, the care provided by the visa applicant to his brother's family is not of a substantial and continuing nature. Therefore the Tribunal finds that the visa applicant does not fall within the definition of a special need relative and the application also fails on this ground. Therefore, the Tribunal is not satisfied that the visa applicant comes within the definition of a special need relative in regulation 1.03 at the time of decision. The Tribunal finds that the visa applicant does not meet clause 806.213. Having decided that the visa applicant was not a "special need relative" at time of visa application, it therefore is unnecessary for the Tribunal to consider whether the visa applicant is a "special need relative" at the time of the Tribunal's decision. The visa cannot be granted unless clause 806.213 is satisfied. To meet clause 806.321 the visa applicant's spouse and children must be the members of the family unit of a person who, having satisfied the primary criteria, is the holder of a subclass 806 visa. As the visa applicant does not satisfy the primary criteria for a subclass 806 visa, or any other subclass, the visa applicant's spouse and children do not satisfy the criteria for a subclass 806 visa or any other subclass. He noted the applicants had argued that the MRT applied too narrow a definition of the term 'other serious circumstances' and, in particular, had criticised the MRT's failure to refer to Wu v Minister for Immigration and Multicultural Affairs [2000] FCA 1817 ; (2000) 105 FCR 39 ( 'Wu' ), a decision of a Full Court of this Court which, the applicants contended, 'modified and extended' the definition of 'other serious circumstances' adopted in Huang, which was applied by the MRT. 27 The magistrate also noted the applicants' reference to Narayan v Minister for Immigration and Multicultural Affairs [2001] FCA 1745 ( 'Narayan' ). The applicants had submitted to the magistrate that, in that case, the Full Court decided 'that "serious" is simply intended to reinforce the nature of the assistance that is central to the definition, namely assistance which is substantial and continuing in relation to a need for assistance which is permanent or long-term'; and '... since the cause of the permanent or long-term need must be 'serious' circumstances ... it seems likely that often such a need will be able to be met by nothing less than 'substantial assistance'. " Counsel had submitted that, if the Tribunal had considered the needs of the children and the other matters set out in the amended application for review, it would have been open to it to find there were serious circumstances requiring substantial and continuing assistance. 28 The magistrate noted that the applicants had argued that the MRT 'erred by not being cognisant of Wu and its apparent inclusion of a child's needs as being serious'. It was contended the MRT had 'identified the wrong issue, or had asked itself the wrong question and, in so doing, fell into jurisdictional error'. The Full Court in Wu focused on the question of whether young or old age must be excluded from the consideration of whether a person has a permanent or long-term need for assistance on the basis of "other serious circumstances", and found that it should not be necessarily excluded. Wu considered the circumstances of a child of tender years (aged 3) and found that "age can be a factor which, along with other circumstances, adds up to special circumstances". It does not, in my view, extend the definition of "serious circumstances" to include the circumstances of the Applicants. A failure by the Tribunal to cite Wu as an authority in the context of the present case does not reflect that the Tribunal had asked itself the wrong question or identified the wrong issue. I am satisfied that the Tribunal directed its mind to the broad issues raised by the Applicant about the nominator's needs and those of his children and, having done so, found that those needs were not substantial or continuing. A basic finding of fact that this Court is not able to review. In doing so, the Tribunal carried out its statutory function without error, and it is beyond the jurisdiction of this Court on review to reconsider the merits of such a factual conclusion by the Tribunal. The application for review was dismissed. In particular, as he had done before the magistrate, Mr Fairfield complained of the MRT having overlooked Wu . In Wu , the Full Court adopted a different approach to that in Huang . The headnote in Wu in the authorised report notes that Huang was "not followed". Huang , to which the Tribunal referred, also concerned the circumstances of a young child. The Court confirmed that there was 'nothing' in the expression "serious circumstances" which suggested "that a necessary feature of the circumstances is that they be out of the ordinary or unexpected. Their survival can be dependant on the support and attention of others. The argument that 'serious circumstances' cannot 'reflect merely the tender age of a person' rather misses the point. The age, whether of a very young or very old person, would rarely be the sole relevant circumstance. But age can be a factor which, along with other circumstances, adds up to special circumstances". Mr Fairfield also noted that Wu had been cited with approval in Narayan and in Singh v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 298 , another Full Court decision. The nominator had custody of two of his daughters who were aged 12 and 8 years respectively. The two elder daughters did not reside with their mother and were also separated from their youngest sister. Their mother and their youngest sister had apparently travelled to Sri Lanka and had not returned and this had caused difficulties. The eldest daughter was approaching puberty and required a female role model. There was no suggestion in the material that the nominator had re-married or had a female partner. There was evidence, not rejected by the Tribunal, that none of the nominator's relatives in Australia were able to provide the required assistance. In considering what are serious circumstances, the Tribunal was therefore obliged to consider cumulatively the circumstances of the daughters which gave rise to the relevant needs of the nominator: Su v MIMIA [2001] FCA 1409 per Madgwick J at [27]. On any view, the Tribunal did not consider the circumstances of the nominator's daughters. 37 Mr Fairfield recognised the MRT had also found the assistance provided was not substantial and continuing. Whether assistance is substantial and continuing depends upon a consideration of the circumstances which gave rise to the need for that assistance. Regularly accompanying a blind person for a visit to the doctor may constitute substantial and continuing assistance in circumstances were [sic] accompanying a sighted person may not. He said it was incorrect to say the MRT did not consider the circumstances of the nominator's children. He cited Shane Gararth's statement to the MRT 'that his family provided considerable emotional support to the nominator and his children, the latter being very attached to the visa applicant's family'. He also cited the MRT's mention of evidence given by Perry Gararth. The respondent submits that, in light of a fair reading of the Tribunal's Decision, it cannot be said that the Tribunal failed to consider the Nominator's children's circumstances. There is no evidence to show that the appellants proffered material about the children's circumstances that the Tribunal ignored. First, for the reasons given above, the respondent submits that the Tribunal did consider the Nominator's children's circumstances, and, therefore, the Tribunal committed no error that could affect the Tribunal's finding that the relevant assistance was not "substantial and continuing". This finding alone supports the Tribunal's Decision. 41 There is room for debate about the correctness of the MRT's statement, in the opening sentence of its para 31, that the approach enunciated in the cases cited in para 30 'has since been overturned by the Full Court'. However, it is unnecessary to resolve that question. The critical issue is whether the MRT was correct in believing the three Full Court decisions it cited, and Emmett J's decision in Hussein , represented the then state of the law. Analysis of Wu shows they did not. 42 The 'special need relative' relied on in Wu was the appellant's child. The child's father was an Australian citizen, but the appellant said she did not trust the father to care for the child on a correct and proper basis; so she wanted to stay in Australia in order to do so herself. The child did not suffer any significant medical problem. The MRT refused the application, saying there needed to be 'evidence that the child has some illness or disability beyond being merely a child'. Relying on Huang , a judge dismissed an application for review. The Full Court unanimously allowed an appeal. 43 At [20]-[21], the Wu Full Court quoted the view expressed in Huang by Hill J (with whom Jenkinson J agreed) that the 'definition of "special need relative" ... should not be construed so as to include every case involving a child of tender years unable to care for himself or herself'. His Honour was influenced by the juxtaposition, in the definition, of death, disability and prolonged illness. As the Wu Full Court noted at [22], Lehane J took a similar approach, but thought 'it would be odd if on the true construction [of the definition] serious circumstances affecting an Australian citizen or resident aged less than 18 could never justify the grant of a visa ... to a relative who was willing and able to provide substantial and continuing assistance to the citizen or resident'. 44 Huang had a complication that was not present in Wu and is not present in this case: the nominator was an infant; something that Jenkinson and Hill JJ regarded as impermissible. 45 After considering what was the ratio decidendi of Huang , the Wu Full Court decided that, although it should have regard to the views expressed in Huang , it was free to come to its own conclusion about the correctness of those views. In doing so the definition is intended to identify, as a criterion or an element of a criterion, a class of person who might remain in Australia to tend to the needs of a citizen who is unable to care for himself or herself for a lengthy period. It is, with respect, not self-evident that a child of tender years was intended to be excluded from the group who are unable to care for themselves. A child's needs are, in many respects, no different to those of a very elderly person or a seriously ill person. Their survival can be dependent on the support and attention of others. The argument that "serious circumstances" cannot "reflect merely the tender age of a person" rather misses the point. The age, whether of a very young or very old person, would rarely be the sole relevant circumstance. But age can be a factor which, along with other circumstances, adds up to special circumstances. Counsel for the Minister identified four such circumstances namely depression which did not fall within any medical or clinical definition of that term ..., imprisonment (though accepting that this would probably have to be imprisonment of the member of the family unit), financial ruin or drug addiction. Even accepting, for present purposes, that none of these circumstances is either a "disability" ... or a "prolonged illness", each exemplifies the disparate circumstances in which the need for long-term assistance might arise. Each is "serious" in the sense that it involves something having a substantial and negative effect on the person affecting their capacity to look after himself or herself or to look after another person. Another feature common to each is that they involve something which was out of the ordinary and perhaps could be said to be unexpected. In our opinion the word "serious" is simply intended to reinforce the nature of the assistance that is central to the definition, namely assistance which is substantial and continuing in relation to a need for assistance which is permanent or long-term. That is, the circumstance is sufficiently serious that, in relation to a citizen, it would require assistance of the same sort that would be required if the citizen was suffering from a disability or prolonged illness. In our opinion, if a citizen or a member of the citizen's family unit is in circumstances which create a need for substantial and continuing assistance of the citizen and the circumstances do not arise because of the death of a member of the family unit or the disability or prolonged illness of either the citizen or the member of the family unit then those circumstances are intended to be comprehended by the expression "other serious circumstances". There is no reason in logic or of policy that we can discern which might explain that the definition was intended to be enlivened in every circumstance where the requisite care of a citizen is required except young childhood and perhaps old age. We say perhaps old age because the long-term or permanent need for substantial and continuing assistance of an elderly person ordinarily arises through a disability or illness associated with old age. Accordingly the primary judge erred in concluding that the Tribunal was correct in reaching the contrary conclusion. Whether the appellant satisfies all the criteria for a subclass 806 visa is another question. The MRT applied those holdings, in the concluding sentence of para 32, as its justification for rejecting the appellants' visa application. 50 At para 35, the MRT said that 'assistance with the care of children is not regarded, in the absence of other factors, as constituting a permanent or long-term need'. However, as the Wu Full Court pointed out, age will rarely be the sole relevant circumstance. There will always be other factors. The task is to evaluate the claimed need in the light of all the surrounding circumstances. 51 Counsel for the first respondent submitted that, whether or not there is any error in paras 31 --- 34 of the MRT's reasons, the finding set out in para 35 required rejection of the appellants' visa claim. It will be recalled that, in para 35, the MRT determined that 'the care provided by the visa applicant to his brother's family is not of a substantial and continuing nature'. The chapeau of reg 1.03 requires the 'special need relative' to be a relative 'who is willing and able to provide substantial and continuing assistance' to the nominator. It follows that, if the finding in para 35 was an independent finding, uninfluenced by the errors in paras 31 and 32, it would not be appropriate to set aside the MRT's decision; the MRT would have acted correctly in affirming the delegate's decision. 52 However, it is clear that the finding in para 35 was not uninfluenced by the errors in paras 31 and 32. On the contrary, it stemmed directly from what the MRT had earlier stated. In the second sentence of para 35, the MRT observed that the regulations require the assistance to be of a substantial and continuing nature. It went on: ' As noted above , assistance with the care of children is not regarded, in the absence of other factors, as constituting a permanent or long-term need' (emphasis added). Without giving any other reasons, the MRT then immediately found the care provided to the nominator's family not to be of a substantial and continuing nature. 53 This is not a case in which the MRT evaluated the nature and extent of the care provided to the nominator's family and made findings of fact as to its substantiality and continuity. If that had been done, the appellants would have had no legitimate basis for complaint. The strength of the appellants' case is that the MRT regarded their care of the nominator's children as being ineligible for consideration because of a mistaken belief, induced particularly by Huang and Hussein , that the needs of young children (at least, unless they suffered from disability or prolonged illness) could not constitute 'other serious circumstances' within the meaning of reg 1.03 and, consequently, had failed to evaluate that care and the surrounding circumstances. Wu and subsequent cases had established the belief adopted by the MRT was incorrect, but the MRT member who decided this case was apparently unaware of them. The member's ignorance of Wu led her to fall into errors of law that directly affected the outcome of her review. 54 It is not useful to speculate as to whether the appellants' application for review would have been successful if the MRT member had correctly understood the law and made the necessary factual findings; the appellants were entitled to have the MRT decide the case, on its merits, free from jurisdictional error. It is apparent that the learned magistrate would have taken that course, if he had reached a different conclusion about jurisdictional error. In my view, it should not be exercised, in the circumstances of this case, in favour of the Applicants. When informed of the Tribunal's decision, the Applicants chose not to challenge it as provided under the law, resolving instead to request the Respondent under s.351 of the Act to exercise his discretion in their favour. The Applicant seems to have abandoned at that time any course that would seek to challenge the decision of the Tribunal on grounds available at law. The Applicant's conduct implicitly accepted that the Tribunal's decision was not to be the subject of challenge. Whilst that request to the Respondent was under consideration, the Applicant availed himself of another avenue of challenge to his migration status afforded by class actions in the High Court. It was only after this challenge proved unsuccessful that, after a very significant time had expired, the application for review was filed. In his outline of submissions, he particularly mentioned two authorities. The first of them, Re Commonwealth of Australia; ex parte Marks [2000] HCA 67 ; 177 ALR 491 was cited by the magistrate. The second, S58 of 2003 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 451 ( 'S58' ), was not. 58 Marks was not a migration case. The applicant sought an extension of time, pursuant to the High Court Rules , within which to apply for constitutional writs challenging a decision to terminate his employment. The applicant had waited 14 months, after the termination decision, before applying for relief to the Australian Industrial Relations Commission, pursuant to s 170CE of the Workplace Relations Act 1996 (Cth). His application was dismissed. The applicant sought leave to appeal to the Full Bench of the Commission against the dismissal order. On 19 February 1999, leave was refused. The applicant then waited 17 months, until 21 July 2000, before making the application that came before McHugh J. That delay proved fatal to his application. Where there is a formal time limit, I would not extend time to permit him to claim the relief sought. Further, I would as a matter of discretion decline, on the ground of the applicant's long and unsatisfactorily explained delay, to grant any relief to which he might otherwise be entitled. 60 Mr Fairfield pointed out that the Judiciary Act 1903 (Cth) does not impose any time limit for the making of an application for constitutional relief under s 39B. Section 477(1) of the Act requires an application under s 39B of the Judiciary Act , in respect of 'a privative clause decision', to be made within 28 days. However, a decision that is affected by jurisdictional error is not a 'privative clause decision': see Plaintiff S157/2002 v The Commonwealth of Australia [2003] HCA 2 ; [2003] 211 CLR 476 at [87] . Accordingly, Mr Fairfield argued, the time limit in s 477(1) does not apply. Nor does there appear to have been any other specific limit to the time within which the appellants could commence the present proceeding. In contrast to the position in the High Court, there was no relevant Rule of Court. Consequently, the appellants did not require leave to commence the proceeding. The proceeding cannot be dismissed for want of jurisdiction or failure to comply with a Rule of Court. 62 Nonetheless, constitutional relief is a discretionary remedy. There is ample authority for the proposition that excessive, unexplained delay will justify a court in refusing constitutional relief, even to an applicant who has otherwise made out a good case. In determining, for this purpose, what amount of delay should be considered excessive, it will always be necessary for the court to examine all of the circumstances of the case. The longer the delay, the more difficult it will be for an applicant to resist a respondent's invocation of the court's discretion. Although there is not, and should not be, a rigid rule, a delay of five years would ordinarily be extremely difficult to excuse. So the result in S58 is not surprising. Similarly, in relation to Marks . Although the delay in that case was less (17 months), that delay had to be examined in the context that it was a delay in litigation concerning termination of employment, an area in which expedition has always been thought particularly important, and the delay was being measured against the particular times specified by the High Court Rules. A delay of two years in seeking constitutional relief is a delay of such significance as to call for explanation, if a court is not to reject the case on discretionary grounds. 64 In the present case, there is an explanation. Fifteen days after the MRT's decision, the appellants applied to the Minister under s 351 of the Act . That was not an application at law; it was not capable of invalidating the MRT's decision. However, it was a clear indication to the Minister, and his advisers, that the appellants were unwilling to accept the MRT's decision as the final resolution of their rights. It was not unreasonable for the appellants to hold off any legal challenge to the MRT decision until they had ascertained whether the Minister would be prepared to override the decision pursuant to s 351. I do not know whether the appellants believed the Minister would not consider their s 351 application whilst there was pending litigation in relation to the validity of the MRT's decision. If they did, they were probably correct; that was the view taken by the Minister in relation to the pending High Court class action, even though that litigation did not directly affect the MRT decision. Because the Minister took that view, it must have been obvious to everybody that nothing much would happen, in relation to the appellants' position, until the class action was finalised. 65 The class action was finalised on 20 February 2004. The present proceeding was commenced only 27 days later, on 18 March 2004. Whether or not the appellants had received a final answer to their s 351 application when they commenced the proceeding, it cannot be said they unduly delayed after 20 February 2004. 66 In the circumstances of this case, it would not be appropriate to refuse relief on discretionary grounds. The orders made by the learned magistrate should be set aside. In lieu thereof, appropriate constitutional relief should be granted. The respondent must pay the appellants' costs both in this Court and in the Federal Magistrates Court. I certify that the preceding sixty-seven (67) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Wilcox. | visa application special need visa whether migration review tribunal fell into jurisdictional error in determining that care of a child or children could not constitute 'other serious circumstances' within the meaning of reg 1.03 whether proceeding ought to have been dismissed on account of appellants' delay. migration |
Having considered a petition which had been filed in the High Court and referred for trial in this Court I concluded that the Australian Electoral Officer ("AEO") for Victoria had erred in ruling that nine ballot-papers, cast in the election for a Member of the House of Representatives for the Division of McEwen, held on 24 November 2007, were formal. I found that a further 142 votes, which the AEO had determined were informal were formal and should have been counted. As a result of these decisions I determined that the first respondent had been certified correctly as the candidate who had been elected for the Division. She had been so elected by a margin of 27 votes after the preferences of other candidates had been distributed. The parties sought an opportunity to consider my reasons before making submissions as to what orders should be made by the Court. The parties agreed on the orders which they wished the Court to make. Pursuant to O 35 rule 10 of the Federal Court Rules , they submitted minutes of consent orders on 4 July 2008. The petition is dismissed. The Commonwealth pay the First Respondent her costs of and incidental to the petition, including costs reserved by Crennan J on 21 February 2008 and any other reserved costs, on a party/party basis. At no stage was the Commonwealth a party to the proceeding. The second respondent expressly disavowed any right to speak on behalf of the Commonwealth in relation to costs issues. For this reason I listed the matter for hearing on the question of whether a costs order could be made against the Commonwealth without the Commonwealth being afforded the opportunity to be heard. At the hearing senior counsel for the second respondent advised the Court that an appropriate officer within the Department of Finance and Deregulation had been advised of the proposed orders and would write to the Court advising that the Commonwealth did not oppose the making of such orders. By letter dated 7 July 2008 Mr Marc Mowbray-d'Arbela, the Assistant Secretary, Legislative Review Branch, Financial Management Group of the Department of Finance and Deregulation advised the Court that he was authorised "to convey the position of the Commonwealth in relation to costs. " That position was that the Commonwealth did not object to the Court making the orders which were sought. The Court has a discretionary power, under ss 360(1)(ix) and (4) of the Commonwealth Electoral Act 1918 (Cth) ("the Act") to make orders of the kind sought in paragraphs two and three of the minutes submitted to the Court. Orders of this kind may be made "where the Court considers it appropriate to do so. In such cases it may be appropriate that the public purse ought bear the costs or some of them. I do not suggest that these categories are exhaustive, but it would not be appropriate to exercise the discretion whenever a litigant chooses to put the validity of an election to the test. Some warrant for imposing a liability on the funds of the Commonwealth must appear before it is appropriate to make an order. It is a general power conferred upon the Court of Disputed Returns, in the exercise of its special jurisdiction, to order that the Commonwealth pay the costs of a party whenever the Court considers it appropriate so to do. We would not attempt to confine it by definition beyond saying that it should be exercised when considerations of what is fair and just support, on balance, an order indemnifying a party against costs which the party may have incurred in connexion with an electoral petition. The proceeding raised issues which were novel and which it was in the public interest to resolve. The Court found that a significant number of inadvertent errors had been made during the scrutiny of reserved ballot-papers. The petitioner had been prejudiced by an even greater number of errors than had been alleged in the petition. These errors would have affected the outcome of the election had it not been that an even greater number of errors were made which prejudiced the successful candidate. The fact that these errors had occurred and required correction by the Court is probably a sufficient reason, standing alone, to make the orders sought. There were, however, a series of novel issues which it was necessary to resolve in the course of the proceeding. Those issues included: Whether the parties, or their legal advisors, could be provided with access to the reserved ballot-papers consistently with the provisions of s 360(1)(iii) of the Act and, if so, on what conditions. Whether the Act imposed any statutory obligations on an Australian Electoral Officer which, if not complied with, could give rise to a contravention of the Act. What processes should be adopted by the Court in order to deal with a petition which alleged that errors had been made by an Australian Electoral Officer in determining the formality of reserved ballot-papers. Whether the Court should engage in merits review or judicial review of decisions made by an Australian Electoral Officer under s 281 of the Act. The orders sought should, therefore, be made. There should also be a direction, pursuant to the requirements of s 369 of the Act, that the Registrar provide a copy of my orders to the Governor-General and to the Clerk of the House of Representatives. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY. | court of disputed returns appropriate orders where parties agreed the commonwealth should pay the costs of the petitioner and of the first respondent where the commonwealth was not a party to the petition where the commonwealth did not object to the orders sought where the proceeding raised novel issues that were in the public interest to resolve where the court corrected errors made during the scrutiny of the reserved ballot-papers parliamentary elections |
He entered Australia in November 2003 and made application for a protection visa the following month. He claimed to be a Muslim and a vice president of the United Religion Social Association. He said that he had attended a rally with other members of the organisation and had been attacked by police and threatened with arrest. A delegate of the Minister refused the application and the applicant appealed to the Refugee Review Tribunal ("the Tribunal"). 2 The Tribunal affirmed the delegate's decision. It did not accept the factual assertions made by the applicant. The applicant was found not to be a credible witness because of material inconsistencies in his evidence. The Tribunal found that the claims of the applicant in relation to his religion and his political opinion were not made out. 3 The applicant sought judicial review of the Tribunal's decision in the Federal Magistrates' Court. The application was dismissed: see SZDWX v Minister for Immigration and Multicultural Affairs [2005] FMCA 1015. An appeal to this Court from the Federal Magistrates' Court was dismissed by Gyles J on 10 November 2005: see [2005] FCA 1632. The applicant thereupon commenced further proceedings in the Federal Magistrates' Court, this time seeking review of the decision of the Minister's delegate which had earlier been the subject of appeal to the Tribunal. 4 In his second application to the Federal Magistrates' Court the applicant complained that the delegate's decision involved a breach of natural justice, that the delegate did not have jurisdiction to make the decision which had been made because the requirements of ss 66(1) , 66 (2) of the Act had not been observed; and that the decision was an improper exercise of power. None of these grounds was particularised. The applicant acknowledged that the proceeding had been commenced out of time but asserted that it was not vexatious or an abuse of process and that it was capable of being reviewed by the Court. 5 The respondent filed an application in the proceeding under r 13 of the Federal Magistrates' Court Rules 2001 (Cth) ("the Rules ") seeking summary dismissal of the application on various grounds. They included the contention that the proceedings were vexatious and/or an abuse of process and that the application had been brought out of time with the result that, pursuant to s 477(1) of the Act, the Court lacked jurisdiction to entertain the application. 6 On 13 September 2006 a Federal Magistrate made orders that the application be dismissed with costs. Her Honour also made orders adding the Tribunal as a second respondent. This latter order does not appear to have been appropriate given that the applicant was seeking to impugn a decision of a delegate of the Minister. On the same day her Honour published reasons for her decision: see SZDWX v Minister for Immigration and Multicultural Affairs [2006] FMCA 1423. 7 On 28 September 2006 the applicant filed an application for leave to appeal from the Federal Magistrate's decision in this Court. The application was called on for hearing before me on 12 February 2007. The applicant appeared in person and had the assistance of an interpreter. He said that he had received some advice from a friend who had helped him prepare the application. The friend was, apparently, under the impression that the Federal Magistrate had dismissed the application summarily and that leave was, therefore, required before an appeal could proceed. 8 Counsel for the Minister advised the Court that the Minister considered that the Federal Magistrate had dismissed the application on the ground that, even if the delegate had, in some way, erred in law, any such error had been "cured" by the subsequent hearing before the Tribunal: see Twist v Randwick Municipal Council [1976] HCA 58 ; (1976) 136 CLR 106. 9 An examination of her Honour's reasons left me in some doubt as to the basis on which she had determined to dismiss the application. At one point she said (at [16]) that "it would be entirely inappropriate to consider relief of the Delegate's decision. " However, later (at [18]) she referred to the Minister's "motion that was dismissed" thereby suggesting that she had not dismissed the application on a summary basis. 10 After the matter had been raised by the Minister's counsel and the implications were explained to the applicant he nonetheless asked the Court to proceed to determine his application for leave to appeal. The Minister's notice of motion was not available to the Court; nor did counsel for the Minister (who did not appear before the Federal Magistrates' Court) have instructions as to what relevant procedural steps had been taken in that Court. 11 In the circumstances I invited counsel for the Minister to seek to obtain a copy of the Minister's notice of motion, and, if possible, to obtain a short affidavit from the representative of the Minister in the Federal Magistrates' Court explaining what had transpired. I asked that copies of the notice of motion and any affidavit should be provided to the applicant prior to an adjourned hearing on 14 February 2007. 12 When the matter was called on on 14 February 2007 the applicant did not appear. Counsel for the Minister filed in Court a short affidavit from a solicitor who had acted for the Minister when the proceeding was before the Federal Magistrates' Court. That affidavit disclosed that the Minister's notice of motion had been dismissed on 15 December 2005 and that the Federal Magistrate had then set the matter down for a final hearing on 13 September 2006. At that final hearing the application had been dismissed. 13 I further adjourned the hearing until 16 February 2007. I asked that steps be taken to advise the applicant of the adjourned hearing date and that, on that date, I proposed to hear any further argument which the applicant may wish to advance in the light of the material contained in the affidavit and then to proceed to determine the application. 14 The applicant attended the adjourned hearing on 16 February 2007. He said that he did not wish to add to the submissions which he had already made. 15 It is now clear, in my view, that the learned Federal Magistrate dismissed the applicant's application for judicial review of the delegate's decision on a final basis. I have carefully read her Honour's reasons for decision and can discern no appealable error. Indeed, I consider that she was correct in coming to the view that, once the applicant had exercised his appeal rights and been accorded a full rehearing on the merits before the Tribunal, any error (assuming that there was one) made by the delegate, did not and could not have any material bearing on the operative and prejudicial decision of the Tribunal which was later made and unsuccessfully challenged by the applicant. 16 The application should be treated as an appeal from the decision of the Federal Magistrates' Court and that appeal should be dismissed with costs. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court. | no point of principle migration |
Pursuant to O 52, r 15(1)(a) of the Federal Court Rules (Cth) (Rules) the applicant had until 18 December 2008 to lodge an appeal. The Court may extend the time "for special reasons" under O 52, r 15(2). The applicant is a citizen of the People's Republic of China and claims to be a Falun Gong Practitioner. On 2 February 2008, he departed China legally on a passport and an ADS Tour Group (class TR-676) visa. The visa was valid until 22 February 2008. He left his ADS tour group and remained in Australia. On 13 February 2008, the applicant lodged an application for a protection (Class XA) visa with the Department of Immigration and Multicultural and Indigenous Affairs. A delegate refused his application on 21 February 2008, stating that his claims were vague, and he was not of interest to the Chinese authorities because he was able to legally depart China on a passport. On 26 March 2008, the applicant lodged an application for review of the delegate's decision with the Refugee Review Tribunal. On 12 June 2008, the Tribunal affirmed the delegate's decision. The Tribunal held that the applicant was not a witness of truth. He could not fully demonstrate the Falun Gong exercises, had difficulty answering questions about Falun Gong and had not practiced Falun Gong while in Australia. On 16 July 2008, the applicant filed an application in the Federal Magistrates Court (FMC) seeking judicial review of the Tribunal's decision. On 27 November 2008, the Federal Magistrate determined that the Tribunal had complied with its obligations under the statutory regime, and there was no jurisdictional error. The applicant filed the application for an extension of time to appeal to this Court on 2 July 2009 in the New South Wales District Registry of the Federal Court, together with an affidavit in support and draft notice of appeal. The application was filed more than six months after the deadline provided for in O 52, r 15(1). The application was then transferred to the Western Australia District Registry of the Court by order of Justice Stone on 7 July 2009. How could I find so much money for the fees. On 15 June 2009 I was detained by officers of the Immigration Department. I was advised to continue my case to your Court for review the decision of the Federal Magistrates Court. My application is beyond the time limited. So I request that your Court would consider my circumstances and accept my application. I greatly appreciate your kindness. The applicant filed a draft notice of appeal, with his application for an extension of time, which included the following grounds: The Refugee Review Tribunal had bias against me. The Tribunal failed to consider my application for protection visa according to s 91R of the migration act 1958. The Tribunal failed to notify me in written the reason or part the reasons for affirming the decision. The Tribunal therefore failed to consider my application for a protection visa according with s 424A of the Migration Act 1958 . I was not given an opportunity to comment on the reason. The Honourable Judge Emmett failed to find the Tribunal error. (2) Notwithstanding anything in the preceding subrule, the Court or a Judge for special reasons may at any time give leave to file and serve a notice of appeal. "Special reasons" must be understood in a sense capable of accommodating both types of situation. It is an expression describing a flexible discretionary power, but one requiring a case to be made upon grounds sufficient to justify a departure, in the particular circumstances, from the ordinary rule prescribing a period within which an appeal must be filed and served. Factors to be taken into account in the exercise of the discretion include the importance of the question sought to be raised by the proposed appeal, the bona fides of the proposed appeal and the prima facie strength of the proposed ground of appeal ( Jess v Scott at 188). (b) There must be some acceptable explanation for the delay. (c) Any prejudice to the respondent in defending the proceedings, caused by the delay, is a material factor militating against the grant of an extension. (d) The mere absence of prejudice to the respondent is not enough to justify the grant of an extension. (e) The merits of the substantial application are to be taken into account in considering whether an extension is to be granted. Wilcox J's comments were endorsed by the Full Court at [6] in Parker v The Queen [2002] FCAFC 133. In response to the material found in the applicant's application for an extension of time, and his affidavit in support of his application, the first respondent submits that: The first respondent conceded that there is no prejudice to the respondents in allowing leave to file a notice of appeal. However submitted that the mere absence of such prejudice is not enough to justify the grant of an extension: Hunter Valley Developments v Cohen [1984] FCA 176 ; (1984) 3 FCR 344. The first respondent submitted that the merits of the substantial application are without substance and it is therefore appropriate for leave to be refused notwithstanding that other circumstances might warrant the extension of time. Counsel noted the decision of WAJU v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 150. HAS THE APPLICANT OFFERED AN ACCEPTABLE EXPLANATION FOR THE DELAY? It is therefore necessary for the Court to consider the applicant's reasons for delay to decide whether they are 'very persuasive'. How could I find so much money for the fees! On 15 June 2009, I was detained by the officers of the Immigration Department. I was advised to continue my case to your court for review the decision of the Federal Magistrates Court. My application is beyond the time limited, so I request that your Court would consider my circumstances and accept my application. I greatly appreciate your kindness. The first respondent submits that the applicant's financial situation was not the true reason for his delay in filing his application, on the basis that: The Court accepts that generally speaking, the impecuniosity of the applicant was the reason he did not immediately lodge an appeal against the FMC decision when advised by his agent. Even so, there is extensive authority that this alone is not an acceptable explanation. In BRGAO v Minister for Immigration and Citizenship [2009] FCA 126 , Spender J dealt with a similar explanation for delay to the present applicant's. The only explanation for the delay in taking any step in this Court between that date and 14 May 2003 is the appellant's failure to pay his solicitors' fees. Without more, such a situation would not provide a reason for exempting a party from the application of the rules prescribing time limits. It cannot therefore provide a sufficient explanation for the continuing delay on the part of an appellant for filing an application for leave to appeal. It is not an acceptable explanation in the light of those authorities, nor does it satisfy the requirement of special reasons for the grant of an extension of time in O 52 r 15(2). In these circumstances the Court does not find it necessary to conclude, one way or the other, that the true reason for the lodging of his application in July 2009 was the fact of his detention in June 2009, and the advice he was given following his detention to attempt to continue his appeal proceedings. Causally, there is no doubt that the fact of detention resulted in this application, but impecuniosity lies beneath that explanation. It is also worth noting that the applicant does not claim that he was unaware of the relevant time limit to file his notice of appeal. It would appear that his agent advised him of the option of appealing to the Federal Court, in the context of advising him that he would need to "pay at least $5000 for the Court and Solicitor fees". The present case can therefore be distinguished from authorities where the 'special reasons' for giving leave include that an applicant, being not fluent in English, was not aware of the time limit. For example, in WAAJ v Minister for Immigration and Multicultural Affairs [2002] FCA 757 , a decision in which Carr J ultimately granted leave to appeal, His Honour had before him affidavit evidence from the applicant that "I was not notified of the 21 days limit to appeal in the decision by the Federal Court. I must clear [sic] that I can not read or write in English language". In the present case, the applicant is not claiming ignorance of the time limit, but is rather seeking to deal with his predicament faced with the realisation his removal from Australia is imminent. However the mere absence of prejudice to the respondent is not enough to justify the grant of an extension: Hunter Valley Developments [1984] FCA 176 ; 3 FCR 344 at 348. The grounds that he is raising are, in my opinion, without substance. For that reason, I am not satisfied special reasons exist which warrant the extension of time. WAAJ [2002] FCA 757 at [13] . It is noted that in his draft notice of appeal, the applicant does not allege that the FMC erred in dismissing ground 1 of the amended application. It is nevertheless appropriate to consider whether the FMC erred in its reasoning. The first respondent submits that the Tribunal appropriately referred to independent country information on the grounds that: I accept the first respondent's submission. This ground must fail. The first respondent further submits that the Tribunal's adverse credibility finding was based on inconsistencies in the applicant's account, namely, raising the distribution of Falun Gong materials in China for the first time at the Tribunal hearing and was therefore open to the Tribunal to make. I also accept this was the case. The applicant repeats this allegation in ground 2 of his draft notice of appeal. The first respondent submits that there was no information to which the Tribunal had regard that enlivened its obligations to notify the applicant in accordance with s 424A. This is demonstrably so. This ground must fail. The independent country information to which the Tribunal referred is specifically excluded from the operation of s 424A(1) by s 424A(3)(a), and the information given by the applicant for the purposes of his review application is specifically excluded from the operation of s 424A(1) by s 424A(3)(b). This allegation was not raised in the applicant's amended application before the FMC, but was raised in the course of the hearing before the Federal Magistrate. The first respondent submits that the Tribunal did not fail to consider the applicant's application for a protection visa according to s 91R. The applicant responded that he definitely needed the protection of Australia. The applicant stated that he needed it for identification purposes. The Tribunal does not accept this and finds that the applicant in doing so indicated that he did not have any subjective fear in returning to the PRC. To put it another way, the Tribunal was permitted to consider the 'passport' conduct if it was satisfied that it was engaged in other than for the purposes of strengthening his refugee claims. The first respondent in the FMC conceded that the Tribunal did not specifically make a finding regarding the applicant's purposes in obtaining the passport. However, the first respondent submits that the Tribunal must be taken to have implicitly found that, in this case, the conduct of the applicant had been engaged in otherwise than for the purposes of strengthening his refugee claims. That it must be taken to have found this is evident from the conclusion that it reached about the effect of this conduct, that is, that it evidenced the lack of an essential element required to obtain a protection visa. I accept the conduct in Australia was incapable, on any view, of being seen as conduct which could "strengthen" a person's claim to be a refugee. This is particularly so in the absence of any claim by the applicant that his approach to the Chinese Embassy for a passport itself caused fear of persecution. The Federal Magistrate was therefore correct in concluding at [46] that "the only inference reasonably open on the face of the Tribunal's decision record was that the Tribunal was satisfied that the Applicant's conduct was engaged in for purposes other than strengthening his refugee claims". This ground must therefore fail. Even if the Federal Magistrate was incorrect in arriving at this conclusion, it is evident that, had the Tribunal expressly addressed the question posed by s 91R(3)(b), it would have concluded that this conduct was not engaged in for the purposes of strengthening his claims to be a refugee. Moreover, as the first respondent submits, even absent the finding about the passport conduct, the decision would have been no different. No error is discernible and there is no error demonstrated so far as the Federal Magistrate's decision is concerned. As a result, the application for extension of time to appeal should be dismissed with costs. I certify that the preceding sixty (60) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker. | application seeking extension of time for filing notice of appeal application refused migration |
On 3 April 2008 I ordered that three notices of motion, filed by the applicant, be dismissed because he did not appear when the proceeding was called on for the hearing of those motions. The three notices of motion sought leave to appeal from a judgment of Sundberg J made on 29 February 2008 and an extension of time within which to apply for leave to appeal, a stay of his Honour's order that the applicant provide security for costs of an appeal from a decision of a federal magistrate and a declaration that the applicant had provided security for costs in accordance with his Honour's orders by reason of the respondent being the part owner of land in which the applicant had an interest. 2 If such security is not provided as aforesaid, the appeal be forthwith dismissed. 3 The applicant pay the respondent's costs of the motion notice of which was filed on 27 July 2007. On that day the applicant appeared in person and applied for a seven day adjournment to allow time for him to instruct solicitors to act for him on the hearing of the motions. 4 The following submissions and exchanges occurred, Mr Maher told his Honour that he had, by letter to his Honour's associate, advised that he would be seeking and adjournment because he had "retained a legal firm of solicitors which I have named which have said they could take if I am able to get an adjournment of 7 days. That is the date of the sworn affidavits to the extent that I can ascertain the dates of them from the jurats which appear to be crossed through and the four seems to be placed upon them. Last week, on the 26th, in the Supreme Court Mr Maher sought and obtained an adjournment because he had retained solicitors in that matter. Mr Maher lodged some caveats over a property and accordingly the bank applied to remove those caveats. Accordingly the adjournment was granted on that basis. Accordingly, the history is, in my submission, that he engages solicitors at the last minute in order to delay. In my submission, that is fairly apparent in this matter given the date that he swore his affidavits, given that the first that we are told about his intention to engage lawyers in this matter is yesterday and we are here today. So in terms of the merits of the adjournment application, in my submission, it is unsatisfactory. But then when one looks at what is sought in the motions, it is my submission, they are palpably without merit. That was Cleal & White but they referred me through the Law Institute Journal to this particular firm which I rang and that was on the Wednesday and I finally spoke or sent the papers through to Mr Lionel --- I forget his second name now for a second --- but he's the partner and he rang me back yesterday and said, yes, look I'll endeavour to talk to the other side but I really think that you should try and adjourn it for yourself, I'm happy to do this in a week's time, it would take me that long to get around it. I've given him the notices. If he can't the matter will go on next Thursday. No notice of appearance was filed by the firm of solicitors who the applicant had advised his Honour had agreed to act for him. On 1 April 2008 and 3 April 2008 the applicant made contact with my chambers. On that occasion the judge dealing with the matter was Goldberg J. Mr Maher applied to Goldberg J for an adjournment so that he can instruct solicitors who would then appear for him. He said he had already engaged those solicitors on the previous day. Goldberg J was mindful of the advantage of having legal representation before the court when the notices of motion came on for hearing and adjourned the hearing of those notices until this morning. Mr Maher has in the last 24 hours made a number [of] contacts with my chambers in which he has sought successively adjournments for seven days, an indefinite period and, most recently until 2.15 this afternoon. On each occasion he has been advised that the matter was listed for hearing at 10.15 this morning and would be heard. The substance of his evidence was that he had been engaged in litigation in the Supreme Court against the Commonwealth Bank on 31 March and 1 April 2008. He had appeared in person before Smith J. He had initially been represented by counsel but counsel withdrew and the applicant appeared for himself. When attending the Supreme Court he had had to carry a bag which contained heavy folders of documents which he needed to assist him in dealing with the application. He said that this caused him to feel pain and made it difficult for him to move even with the assistance of his crutches. He further deposed that, on 31 March 2008 and 1 April 2008, he received telephone messages from the solicitors whom he had engaged on the previous Thursday, but because he was in court on those days, he was unable to return the calls until late in the afternoon on 1 April 2008. When he did so he was informed by the solicitors that they could not represent him on 3 April 2008 in this Court as they needed to obtain further detailed instructions from him in person and that this would not be possible between then and the morning of 3 April 2008. 9 Mr Maher then sent a facsimile to the associate of Goldberg J and to the solicitor for the respondent seeking an adjournment of the hearing on 3 April 2008. He made the further contacts with the Court to which I had earlier adverted at 8.58 am at 10.01 am and at 10.03 am on 3 April 2008 and, on each occasion, was advised by my associate that, in the absence of consent by the respondent, there would be no adjournment and that the matter was to proceed at 10.15 am that morning. 10 Mr Maher deposes that he did not appear on 3 April because of physical ill health of which he says the Court and the respondent were on notice. He said that the respondent was on notice by reason of the fact that its legal representatives were in the Supreme Court on 31 March and 1 April 2008 and had the opportunity to observe him. He also deposed that during the relevant time he sought the assistance of a medical practitioner but was unable to obtain an appointment until 4 April 2008 and when he did obtain that appointment, he was examined and the practitioner issued a medical certificate certifying that he was unfit for work on 3 and 4 April 2008. 11 The respondent relied on two affidavits of Mr Grant Dewar, a solicitor employed by it. The affidavits were affirmed on 2 April 2008 and 16 April 2008. He said that he based that belief on the fact that the applicant had engaged a solicitor to act for him in the proceeding in the Supreme Court but claimed that he was physically exhausted and unable to give instructions in relation to the matter before this court on 3 April 2008. Reference was then made to certain observations made by Finkelstein J in an earlier proceeding involving these two parties. That is a matter to which I will return. • He had telephoned Mr Maher at approximately 2.45 pm on 2 April 2008 and advised him that any application for an adjournment made on 3 April 2008 would be opposed and that his affidavit of 2 April 2008 would be relied on for that purpose. He sought a fax number from Mr Maher to which he could send a copy of the affidavit. Mr Maher said he would return the call and provide an appropriate fax number within 15 minutes. Mr Maher did not return the phone call. In fact Mr Dewar observed the applicant to be taking notes while submissions were being made in that proceeding and he was observed standing at the bar table and conducting his case. On 2 April 2008 Mr Maher did not attend the Supreme Court hearing and that on that day orders were made that Mr Maher and his wife pay the bank's costs of the Supreme Court proceeding including reserved costs on an indemnity basis to be taxed in default of agreement. • He was not on notice at any relevant time of the applicant's ill health. He accepted that an assertion had been made in the facsimile communication which he received from the applicant to that effect but deposed that he did not believe it. He had not, as at 16 April 2008, been provided with the doctor's certificate which it had been said was issued on 4 April 2008. Specifically Mr Dewar denied that there was any basis upon which he could reasonably be expected to have considered that Mr Maher had an inadequate time to instruct his lawyers. He said that at no time had a lawyer acting on Mr Maher's behalf contacted him advising that the lawyer was not able to proceed on 3 April 2008. • He had appeared before Burchardt FM on 15 April 2008 upon the return of an application made by the applicant to set aside a bankruptcy notice. The applicant did not appear on that occasion and his application was dismissed with costs. The time for compliance with the bankruptcy notice was not extended. The applicant had not paid the sum of $2000 which was required by that bankruptcy notice and thereby committed a further act of bankruptcy after 3 April 2008. • As a result of the adjournment on 28 March 2008 and the failure of Mr Maher to attend at the hearing on 3 April 2008 the respondent incurred legal costs comprising counsel's fees and solicitor's fees in the sums of $3,080 in respect of counsel's fees on 28 March 2008, $2,880 in respect of counsel's fees on 3 April 2008 and solicitor's fees in the sum of $2,691 in respect of both hearings. In addition further expenses had incurred by way of counsel's fees and solicitor's fees in the sum of $3,080 and $1,380 respectively in respect of the notice of motion filed on 10 April 2008. 12 I was referred by the respondent to the judgment of Finkelstein J in Maher v Commonwealth Bank of Australia [2004] FCA 248. The facts in that case bear a remarkable similarity to those in the present case. It was another case in which Mr Maher made an application to adjourn a trial saying that he was suffering from physical disabilities which prevented him from sitting or standing for any length of time and that he would be unable effectively to present his case without the assistance of counsel. His Honour had declined to grant the adjournment sought. These events occurred on 30 January 2004. 13 On 2 February 2004 Mr Maher sent a facsimile transmission to his Honour's associate asserting that he needed an indulgence to delay the matter and that he had notified the respondents by facsimile transmission. The case was called on as scheduled on 2 February 2004 and Mr Maher didn't appear. His Honour advised counsel that he would stand the matter down for a short time to determine whether Mr Maher was absent by reason of his attendance in another court. When the matter resumed his Honour was advised that Mr Maher was not to be found. At that stage Mr Maher's application was dismissed with costs. 14 Another aspect of the matter (a cross-claim) involving Mr Maher was due to be heard later that day and Mr Maher appeared. He advised Finkelstein J that he had just filed an appeal against his Honour's refusal to grant the earlier adjournment. He did not explain why he had not been in court at 11 am when the matter was called on and his Honour adjourned the hearing of the cross-claim until 4 February 2004. On that date his Honour, through his associate, received a communication from Mr Maher seeking an adjournment of that day's hearing on account of a medical problem and indicating that he would provide a medical certificate confirming this on the next day. A facsimile was sent on the same day to the registry which asked that his Honour be advised that Mr Maher would be unable to attend the hearing of the matter on account of his medical condition. 15 The case was called on as scheduled on that day and the matter proceeded in Mr Maher's absence and was adjourned part heard until the following day. On the following day there was another facsimile sent to his Honour's associate by Mr Maher again asserting an inability to attend court and seeking an indulgence for a further adjournment on account of a medical problem. There were two medical certificates attached which asserted that he was medically unfit to attend court on the previous day and there was also a certification of his unfitness to attend from the second day of the hearing, namely 5 February 2004. 16 When the matter came back on his Honour determined that the matter would proceed and it did. On the same day Mr Maher sent another facsimile letter to his Honour's associate indicating that he had been in touch with a solicitor. He sought an indulgence for a further adjournment so that he could obtain legal advice. His Honour delivered judgment in favour of the respondent. The following day Mr Maher moved to set aside the judgments and his Honour advised Mr Maher of the matters which it would be necessary for him to establish in order to have that occur. At the hearing of the application which took place later in February 2004 Mr Maher appeared and advised his Honour that he was not prepared to seek an affidavit from his medical practitioners deposing to his illness and sought only to rely on the certificates. Again that approach seems remarkably similar to the one adopted yesterday in argument before me. I am convinced that Mr Maher intended to take whatever steps were necessary to defer the hearing while he continued his attempts to obtain pro bono counsel. [18] Moreover, I simply do not accept Mr Maher's claim that he was physically unable to attend the hearing on 4 or 5 February 2004. The medical certificates are unconvincing. And, I suspect that Mr Maher did not obtain an affidavit from his doctor, or secure his attendance by subpoena, because the doctor's evidence would not have assisted his cause. [19] Mr Maher's cavalier attitude is inexcusable. There is no reason why a person who is hell-bent on delaying a proceeding in this way should be indulged. I suspect that if a new trial is ordered and Mr Maher still does not have counsel to assist him, he will renew his efforts to have the trial delayed. Tempted as I am to simply dismiss his motion out of hand, I accept that the more important consideration is to determine whether his own claim or his defence or the bank's claim has any merit. If either has merit then it is best left to go to trial. Mr Maher can be suitably punished by an appropriate order in relation to costs, although even that may not put an end to his humbug. I do not accept that the applicant was prevented by ill health from attending the court at 10.15 am on 3 April 2008. Despite the medical certification given the next day that he was unfit to work he advised that he could attend court at 2.15 pm on 3 April 2008. He had failed to give adequate instructions to solicitors even though he was well aware that Goldberg J had said on the previous Friday that the matter would proceed on 3 April 2008. This was another calculated attempt at delay. 19 What is to be done? Very reluctantly I have come to the view that the applicant should have the opportunity to present such arguments as he is able in support of his three notices of motion. He should not however be able to do so unless and until he has paid the respondent's costs which were thrown away by reason of the late application for an adjournment of the hearing on 28 March 2008 and his failure to appear on 3 April 2008. In this context I have regard to the matters referred to by Sundberg J in his reasons for ordering that security be provided for the respondent's costs of the appeal from the federal magistrate. (See at paragraphs 12 to 17 of Sundberg Js reasons. In my view the applicant's prospects of succeeding in obtaining any of the orders sought in his three notices of motion are slight. The respondent claims $13,111 by way of costs thrown away. This amount will, in all probability, tax out at a lesser sum. I therefore propose to order that the setting aside of my orders be made conditional on the applicant paying the respondent $8000 towards its costs. 2 The applicant's notice of motion dated 10 April 2008 otherwise be dismissed. 3 If, by operation of order, 1 the orders made on 3 April 2008 are set aside, the applicant pay the respondent its costs thrown away on the adjournment and incurred by reason of the applicant's failure to appear less any costs paid pursuant to order 1. 4 If, by operation of order 1, the orders made on 3 April 2008 are set aside, the hearing of the applicant's notices of motion dated 13, 14 and 19 March 2008 be fixed for 16 June 2008. 5 The applicant pay the respondent's taxed costs of the motion. I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY. | application to set aside judgment or for judgment to be stayed applicant self represented applicant failed to appear applicant submitted medical certificate evidence for non-attendance whether attempt to delay on condition that the applicant pay part of the respondent's costs, orders set aside practice and procedure |
The difficulty is that the settlement sum of $86,500.00 was insufficient to pay the costs and expenses of action taken by the liquidator to recover the property of the company. The Deputy Commissioner says that as a creditor of the company in liquidation, Vintage Gold Investments Pty Ltd ("Vintage Gold") the Deputy Commissioner agreed to indemnify the liquidator in respect of five categories of action to be taken to recover money paid by the company in reduction of a personal debt of a director to a third party, secured by a mortgage, unrelated to any obligations of the company. An amount of $30,000.00 was paid to the liquidator pursuant to the indemnity. Those funded steps, it is said, resulted in the recovery of the property of the company together with the recovery of expenses, in the sense that "but for' the indemnity and thus the steps, no monies would have been recovered; and by cl 9 of the Deed, the liquidator agreed to apply to the Court upon recovery of an amount arising out of those steps, for an order that the Deputy Commissioner receive priority for the amount of the indemnity in the distribution of the amount recovered. The liquidator says that the application has been made to the Court in conformity with the liquidator's agreement to place the question of the Deputy Commissioner's entitlement to priority before the Court within the scope of s 564 of the Corporations Act . Secondly, s 564 of the Corporations Act as a matter of construction does not, it is said, confer a power to make an order for the distribution or payment of any part of the recovered property in priority to the costs and expenses of the liquidator as those costs and expenses are given priority by s 556(1) of the Corporations Act , although s 564 , properly construed, does confer a power to order a payment or distribution to a funding creditor in priority to other unsecured creditors . Thirdly, if s 564 does confer a power to order distribution of any part of the recovered property to a funding creditor in priority to the liquidator's costs and expenses of recovery, no such order ought to be made having regard to all the circumstances relevant to the steps necessarily taken by the liquidator and his advisers to assert rights and enforce claims against parties that ultimately agree to settle those claims and pay the settlement monies. In other words, the recovery of the property of the company (and relevant expenses) did not arise solely out of the provision of indemnity by the Deputy Commissioner but by reason of other significant steps funded by the liquidator in addition to those steps funded by the Deputy Commissioner. Thus, the combination of steps or activities was productive of the recovery of a fund of money and any order for distribution ought to take account, it is said, of all the relevant factors. Finally, the liquidator says that officers of the Deputy Commissioner conducted discussions with staff of the liquidator over a lengthy period that gave the liquidator the impression that a further Deed of Indemnity would be approved by the Deputy Commissioner which in turn caused the liquidator and his advisers to undertake significant prosecution and recovery steps that became unfunded upon the Deputy Commissioner's decision not to grant a further indemnity. Therefore, since the Court may make orders as it "deems just" under s 564 of the Corporations Act with respect to the distribution of the recovered monies, it is not just, it is said, to order a distribution of $30,000.00 to the Deputy Commissioner in circumstances where the liquidator has ultimately brought the respondents to the settlement table which would not have occurred had all recovery steps ceased on the extinguishment of the indemnity fixed in the amount of $30,000.00. Section 555 of the Corporations Act provides that except as otherwise provided by the Corporations Act , all debts and claims proved in a winding up rank equally and if the property of the company is insufficient to meet them in full, they must be paid proportionately. Section 556(1) of the Corporations Act provides that subject to Division 6 of Part 5.6 of the Corporations Act , in the winding up of a company, the debts and claims described in paras (a) to (h) must be paid in priority to all other unsecured debts and claims, in the sequence or order for payment described in the section. The first category of debt or claim to be paid is, relevantly, expenses (other than the remuneration of the liquidator and particular expenses to be paid to a firm related to the liquidator more broadly defined as "deferred expenses") properly incurred by the liquidator in preserving, realising or getting in property of the company (para (a)). The eighth category in the sequence (dd) is any other expense (except deferred expenses) properly incurred by a liquidator. The ninth category (de) is the deferred expenses. Section 559 provides that the debts of a class referred to in each of the paragraphs of s 556(1) rank equally between themselves and must be paid in full, unless the property of a company is insufficient to meet them, in which case they must be paid proportionately. Barrett J in Australia and New Zealand Banking Group Ltd v TJF EBC Pty Ltd (2006) 224 ALR 490 accepted at [8] that as a matter of power the Court may under s 564 make an order that causes a creditor chosen for preferred treatment to rank ahead of "any one or more of the creditors having claims within the s 556(1) categories". That construction was said to follow firstly because s 556(1) is subject to Division 6 and thus subject to the power conferred on the Court by s 564 and secondly, because s 564 provides that a preferred creditor may be given an advantage " over others in consideration of the risk assumed". The section does not say "all others" or "some others" or "any others". In referring to "others" generally, it contemplates, in my view, that the court may, by its order, give the assisting or indemnifying creditors "an advantage over" any one or more of the other creditors or all of them, with the result that the court may, as a matter of jurisdiction, cause the debts of the creditors in question to be placed on any of the rungs of the ladder of priority created by s 556(1) (and, within a particular rung, above, below or beside the creditors with claims that s 559 causes to rank equally inter se), above the topmost of those rungs or below the bottom rung (yet ahead of "all other unsecured debts and claims"). In short, s 564 is cast in terms giving the court a complete discretion regarding positioning of the whole or any part of the debts of the assisting or indemnifying creditors on the scale of priorities in the winding up and the opening words of s 556(1) cause any such positioning ordered by the court to have effect despite what would otherwise be the order of priority under s 556(1). Nevertheless, the discretion is conferred in broad terms. As to the question of power, the liquidator contends that he is not a creditor in respect of a claim for the payment of the costs and expenses of recovering property of the company for the purposes of s 556(1) and therefore his claim to those costs and expenses cannot be deferred to that of the indemnifying creditor as an exercise of power to adjust claims within s 556(1). Secondly, the liquidator as a person with a claim for payment of recovery costs and expenses is not a person contemplated by the phrase in s 564 "an advantage over others". The liquidator is not, it is said, an "other" person. Accordingly, there is no power to confer an advantage on the Deputy Commissioner over the liquidator in relation to the liquidator's claim to receive the settlement monies in satisfaction of the costs and expenses incurred in recovering the property of the company. Section 556(1) , subject to Division 6, attributes priority of payment to particular classes of debts and claims, as compared with all other unsecured debts and claims. The first such debt or claim is expenses properly incurred by the liquidator in preserving, realising or getting in the property of the company. Section 556(1) treats those expenses as a claim of the liquidator upon the estate or property of the company. Such a claim ranks above all other claims primarily because those expenses in the ordinary course represent the price paid to secure the company's assets or realise or get in the property of the company for the benefit of those entitled to participate in the distribution of that property according to the provisions of the Corporations Act . The paramouncy of those expenses conveys a clear statutory intention that the liquidator is entitled to recoup out of the property of the company, the costs and expenses "properly" incurred in taking the relevant steps that meet the statutory description in s 556(1)(a). However, that claim nevertheless remains a claim within s 556(1) and is subject to a power in the Court conferred by s 564 to adjust the order of priority including the paramouncy of such a claim, as appears just in all the circumstances, as between an indemnifying creditor and others. In that sense, the reference to others must be taken to be a reference to any other person (or entity) that has a debt or claim to be paid in the winding up of a company whatever the priority of that debt or claim may be according to the proper operation of the relevant provisions of the Corporations Act . Accordingly, power is conferred upon the Court by s 564 to make an order that would have the effect of conferring an advantage upon an indemnifying creditor to a distribution of all or a part of the property of the company recovered under an indemnity for the costs of litigation, over the entitlement of the liquidator to payment of expenses properly incurred by him in preserving, realising or getting in property of a company notwithstanding the paramouncy of such a claim under s 556(1)(a). The question that arises is whether such an order is just having regard to the circumstances of the particular case. On 9 February 2006, the Federal Court ordered that Vintage Gold be wound up in insolvency on the application of the Deputy Commissioner. The debt due to the Deputy Commissioner was then $87,836.00. John Lethbridge Greig was appointed liquidator. The company carried on the business of supplying plastic lining for use with horticultural products. Upon appointment, the liquidator wrote to the directors of the company, Ms Joanne Love and Ms Karen Robinson, and requested them to provide the liquidator with all documents in their possession relating to the affairs of the company. Further requests for assistance and cooperation were made of the directors and notices were served on each of them under s 530B(4) of the Corporations Act . The directors were largely uncooperative. Reports were made by the liquidator to the Australian Securities and Investments Commission ("ASIC"). Ultimately, ASIC took proceedings against Ms Robinson in respect of those failures. On 2 June 2006, the liquidator wrote to the Deputy Commissioner seeking an indemnity of $30,000.00 so as to undertake particular recovery action which included action to lodge a caveat over particular land of a director; commence Court proceedings to recover money from that director; apply to the Court for orders for the production by the directors of documents and other orders in relation to documents; issue particular summonses and conduct a public examination of the directors. The costs of $30,000.00 were broken down by reference to the category of person undertaking particular steps. The liquidator identified total potential recoveries that might be achieved by the liquidator, by reference to five matters as, in the aggregate, $628,933.52. Clause 11 of the letter identified six grounds upon which these recoveries might be pursued as a matter of law. The events which were said to give rise to these causes of action included the transfer of assets from the company by directors to a related entity ($437,972.19); a contribution to expenses by a director ($16,781.33); the transfer of company funds to a shareholder ($36,000.00); and a liability on the part of directors in respect of insolvent trading by the company (totalling $138,180.00). The letter was supported by legal advice to the liquidator from the solicitors for the liquidator. The liquidator advised the Deputy Commissioner that there were a small number of creditors in the administration all of whom were owed "minimal debts". By cl 13, the liquidator said that should an indemnity be provided by the Deputy Commissioner, the liquidator would make an application to the Court to give the Deputy Commissioner and any other indemnifying creditor priority under s 564 of the Corporations Act . On 18 July 2006, the Deputy Commissioner requested further information in order to determine whether the funds or assets likely to be recovered would be likely to outweigh the costs of the indemnity sought by the liquidator. The liquidator responded on 1 August 2006 and advised the Deputy Commissioner that the estimated costs would be $30,000.00; should the costs increase significantly a further indemnity would be sought; the only other creditors were trade creditors in an amount of $27,071.34; and the liquidator believed there to be a "high likelihood of success" arising out of the proposed actions. The liquidator anticipated a resolution within six months of granting an indemnity. Further details of the legal costs were given to the Deputy Commissioner on 15 September 2006. On 6 February 2007, the liquidator and the Deputy Commissioner entered into an Indemnity Agreement. On 5 March 2007, Mr Chesters, a Manager employed by Deloitte and acting on behalf of the liquidator, had a discussion with an employee of the Deputy Commissioner (such employees hereinafter described as "the ATO") concerning the issue of invoices in relation to the recovery actions. On 25 June 2007, Mr Chesters had a discussion with a representative of the ATO who requested Mr Chesters to issue an invoice to the ATO for the amount of the indemnity. Mr Chesters was also advised that the liquidator would need to apply for a further indemnity in respect of any additional recovery work to be undertaken by the liquidator that might be the subject of any further invoices to the ATO. On 28 June 2007, Mr Chesters was advised by the ATO's representative that the Deputy Commissioner would wish to examine a transcript of the public examination of the directors and consider a further written application for an additional indemnity before any further indemnity would be granted by the Deputy Commissioner. On 29 June 2007, the liquidator made an application to the Deputy Commissioner for a further indemnity in an amount of $170,000.00 in order to maintain the caveat previously lodged over the relevant land; prosecute Queensland Supreme Court proceedings for the recovery of monies paid by the company in reduction of a director's mortgage; complete the adjourned public examination of the company's officers; amend the Supreme Court proceedings to join parties; obtain a mareva order in the Supreme Court proceedings in respect of assets held by Botany (a company related to the directors of Vintage Gold); and obtain similar orders in Supreme Court proceedings against Ms Robinson and Ms Love. The estimated cost of undertaking these steps was $170,000.00. The liquidator by his letter of 29 June 2007 considered that the potential recoveries arising out of the causes of action maintained against the particular defendants was no less than $330,000.00 and included claims relating to business assets ($437,972.19); transfer of company monies ($36,000.00); directors' liability arising out of insolvent trading ($179,272.00) and claims in relation to a property at Burleigh Heads valued at not less than $500,000.00 and claims in relation to land at Mt. Nathan valued at $1.2 million. On 5 June 2007, the Deputy Commissioner had lodged an amended proof of debt with the liquidator for $128,927.61. The liquidator advised the Deputy Commissioner in that letter that the proposed steps had been recommended by the liquidator's lawyers arising out of the information gained in the course of the public examination of the directors and an analysis of all documents relevant to the contended causes of action. On 2 August 2007, Mr Chesters sought an answer to the request. On 17 August 2007, the ATO's representative advised Mr Chesters that the ATO would not consider a further indemnity without considering the transcript arising out of the public examinations and further, the ATO would not fund purchase of that transcript. On 27 August 2007, Mr Chesters contacted officers of the ATO and sought a response to the further request. Mr Chesters was advised that the ATO was considering the request and a response would be given once a decision had been made. On 30 August 2007, Mr Chesters spoke to an officer of the ATO and was advised that the application for a further indemnity would be recommended to the decision-maker dealing with the request. The ATO officer noted in the discussion with Mr Chesters that the original indemnity seemed to contemplate that a second indemnity might be required. On 4 September 2007, Mr Chesters spoke with an officer of the ATO who said that urgent meetings were to take place within the ATO concerning the request and any further public examination processes would need to be adjourned for a further two weeks within which time a decision would be made concerning the request for a further indemnity. On 14 September 2007, Mr Chesters spoke with an officer of the ATO who advised him that the request for an indemnity in an amount of $170,000.00 was "too high for the ATO to approve" and the request was likely to be declined. Mr Chesters was told that the liquidator could apply for a lesser amount. Mr Chesters expressed surprise at the ATO's position as it seemed to him that the ATO had been positive towards continuing the recovery action for the last 18 months. Mr Chesters said that he was surprised by the advice that the request was likely to be declined as a substantial body of recovery work had been undertaken in light of the ATO's apparent positive position. The work included lengthy public examinations that had been completed; commencement and prosecution of Supreme Court proceedings; and continuance of substantial public examinations and perusal of documents, representing steps over and above the activities the subject of the previous indemnity. Mr Chesters was advised that the decision to refuse the request was "purely commercial" and did not involve public interest considerations. The ATO's representative said that the outcome of the recovery action was "indeterminable" and the exposure to loss of the indemnity funds was too high a risk for the ATO. Therefore, the request for a further indemnity was not likely to be approved. In a conversation on 24 September 2007, Mr Chesters was advised by the ATO's representative that the request had been rejected. On 22 September 2007, the ATO responded to the request for the further indemnity by a letter faxed to the liquidator on 24 September 2007. As you are aware the Commissioner and his staff are subject to very strict provisions in the expenditure of public money ... On this occasion it is considered it is not commercially viable for the Commissioner to provide further indemnities in this liquidation. The request is for $170,000 which is in addition to the $30,000 that has already been paid. It is noted however that you would seek priority for the Commissioner under section 564 of the Corporations Act 2001 but that would, at best, be only $200,000 being the amount of the indemnity(ies) provided. Also, it is not known if the amount being sought would be sufficient considering the legal actions proposed (injunctions) and the requirements of the Queensland Supreme Court to provide securities for such actions. As the Deputy Commissioner provided an amount of $30,000.00 being fees and GST inclusive, we would want to recoup at least $30,000.00. The liquidator advised the ATO that the respondent defendants had requested a release from the ATO in respect of "any claims made by the ATO arising out of any role that any of the parties might have played ... as Directors and/or officers of Vintage Gold Pty Ltd". The liquidator requested the ATO's urgent advice as to that part of the proposal. On 25 October 2007, the liquidator was advised to make a counter-offer increasing the settlement sum to $130,000.00 subject to the ATO's willingness to give a release as requested. On 8 November 2007, the liquidator pressed the ATO for a response. On 13 November 2007, the ATO advised the liquidator that the Deputy Commissioner would not be a party to the deed and would not release the defendant taxpayers from any future action or liability by the Deputy Commissioner. On 15 November 2007, Mr Chesters spoke further with a representative of the ATO. Mr Chesters was advised again of the matters already mentioned in the conversation on 14 September 2007. In addition, the ATO advised Mr Chesters that any proposal to join the Deputy Commissioner as a party to a deed of settlement with defendants or respondents against whom claims had been made and pressed by the liquidator, was unacceptable as the Deputy Commissioner was not a party to any of the proceedings and no "blanket release" would be given by the Deputy Commissioner to the directors of Vintage Gold or entities related to them. On 27 November 2007, the liquidator wrote to the ATO advising that the directors of Vintage Gold had requested a meeting with the ATO to discuss particular matters. The liquidator advised the ATO that the proposal of the directors to settle all claims in consideration of the payment of $100,000.00 subject to the Deputy Commissioner becoming a party to the proposed deed and providing a release, remained open for acceptance. Discussions continued between the solicitors for the liquidator and the solicitors for the parties against whom claims had been made by the liquidator which resulted in a Deed of Settlement of 7 May 2008 by which all claims were released in consideration of the payment of the settlement sum of $85,000.00 which together with an amount of $1,500.00 in respect of particular expenses resulted in a total settlement payment of $86,500.00. The distribution of the settlement sum seems to be this. $86,500.00 was received less the payment of disbursements or outgoings incurred by the liquidator's solicitors resulting in an amount for distribution of $79,818.14. Other disbursements and legal professional fees were $43,840.93 less $1,500.00 received by the liquidator's solicitors resulting in an amount of $42,093.93. After taking account of further disbursements the balance amounted to $42,659.07. That sum was deposited into the liquidator's account in the liquidation. The liquidator held the additional sum of $30,000.00. The liquidator has incurred legal costs of professional fees and disbursements payable to the liquidator's solicitors of $76,669.95. The liquidator has incurred costs and disbursements in conducting the liquidation of the company of professional fees of $93,909.75 and disbursements of $1,303.20 amounting to $95,212.95. The total of the legal costs and disbursements incurred by the liquidator and the liquidator's professional fees and disbursements is $171,882.90. The liquidator says that should the Court direct that the amount of $30,000.00 be repaid to the Deputy Commissioner there would be no other funds to meet the expenses of the liquidation with the result that the solicitors for the liquidator and the liquidator would be required to meet the substantial shortfall of costs and expenses incurred in recovering the assets to date in the liquidation. In the result, the financial position is this. Legal costs and disbursements have been incurred by the liquidator of $76,669.95. The solicitors are holding an amount of $43,840.93 out of the settlement monies which means that they are out of pocket in an amount of $32,829.02. The liquidator has incurred professional fees and expenses of $95,212.95 and is holding $42,659.07 (apart from the indemnity funds) which means that the liquidator is out of pocket by an amount of $52,553.88. The indemnifying creditor is out of pocket in an amount of $30,000.00 subject to the s 564 application. Apart from the arguments advanced by the liquidator in relation to the question of the scope of the power conferred on the Court by s 564 of the Corporations Act , the liquidator says that on the merits an order ought not to be made for payment to the Deputy Commissioner of the indemnity funds out of the recovered property. The liquidator says that the Deputy Commissioner entered into the Indemnity Agreement recognising the risks associated with recovery. Although the liquidator expressed confidence about recovery, there was no certainty that sufficient funds would necessarily be recovered to redeem the amount of the indemnity. Secondly, from the outset, a further indemnity was a real possibility. Thirdly, the liquidator undertook the specific activities the subject of the Indemnity Agreement of 6 February 2007 and was unable to secure a recovery of company property within the limit of the indemnity provided. The liquidator nevertheless continued to maintain the causes of action against the various respondents in an attempt to recover company property. The liquidator says that steps were taken throughout June, July, August and September which were not covered by the indemnity and those steps have contributed towards the ultimate settlement reached in May 2008. Moreover, throughout September, October, November and December 2007 and January, February, March, April and May 2008, the liquidator and his advisers were required to take steps to bring a settlement to fruition. Fourthly, the liquidator says that an examination of the chronology of events reveals that in August 2007 officers of the ATO were expressing confidence that a further indemnity would be granted and against a general expectation that a second indemnity would be granted further work was undertaken which became unfunded once the indemnity was rejected. Therefore, it follows, it is said, that the Deputy Commissioner has contributed to each of the liquidator and the legal advisers to the liquidator undertaking work and incurring expenses which are now unfunded and, by inference, would not have otherwise been incurred. Fifthly, the liquidator says that the Deputy Commissioner was presented with an opportunity to participate in a settlement which would have been productive of settlement monies of $100,000.00. However, the Deputy Commissioner chose not to engage on that proposal and refused to become a party to the deed and provide the release sought by the respondent defendants. Lastly, the liquidator says that it undertook the work the subject of the first Indemnity Agreement and it then became necessary to bring that work to a conclusion through a settlement. The Deputy Commissioner says that no funds would have been recovered but for the provision of the indemnity. The Deputy Commissioner notes that the liquidator has made the application to the Court yet he contends that no distribution should be made from the recovered funds to the Deputy Commissioner as it would cause prejudice to the liquidator and his advisers. The Deputy Commissioner says that nothing more than recovery of the funds provided to facilitate the litigation is sought and the "but for" character of the indemnity means that no funds would otherwise have been recovered. Further, if the order sought by the Deputy Commissioner is made, no return will be achieved on the funds put at risk to enable the litigation to be pursued. The Deputy Commissioner will simply recoup the amount of the indemnity provided. That result is to be compared with, it is said, the position that prevails in relation to the liquidator and his solicitors where each of them have derived costs and expenses of $42,659.07 and $43,840.93 respectively in undertaking the various steps and those fees will be paid out of the recovered property. The Deputy Commissioner says that the liquidator was in a position to control the costs incurred and he understood from the very outset that the Deputy Commissioner had imposed a limit on the funds that might be available. At no time did the Deputy Commissioner agree to the provision of any further funds. It is clear from the liquidator's letter of 2 June 2006 and cl 9 of the Indemnity Agreement of 6 February 2007 that the indemnity was to be provided by the Deputy Commissioner on the footing that where an amount was recovered or received by the liquidator arising out of the processes sought to be undertaken through the use of the indemnity, the liquidator would apply to the Court for an order that the indemnifying creditor would receive priority for the amount of the indemnity. That position was also an element of the proposal in relation to the further indemnity. Having regard to the expectations reflected in the liquidator's letter of 2 June 2006, it seems that the parties proceeded on the basis that property (an amount) recovered by reason of the various processes would significantly exceed the costs of recovery and would thus be productive of a fund of money from which distributions would be made in part reduction of the Deputy Commissioner's debt, after redemption of the indemnity amount. Part reduction of the debts of the trade creditors of $27,071.34 in the aggregate, may have been unlikely. In any event, redemption of the amount of the indemnity was to be a priority. The debt to the Deputy Commissioner was revised on 5 June 2007 to $128,927.61. In the result, the settlement funds fall well short of meeting the costs and expenses of recovery. The authorities ( Australia and New Zealand Banking Group Ltd v TJF EBC Pty Ltd (supra); Household Financial Services Pty Ltd v Chase Medical Centre Pty Ltd (1995) 18 ACSR 294; State Bank of New South Wales v Brown (2001) 38 ACSR 715) demonstrate that in exercising the discretion consideration needs to be given to the risk run by the indemnifying creditor in providing the indemnity; the value of the property recovered or the sum recovered; the failure of other creditors to participate in providing an indemnity; the proportions between the debt due to the indemnifying creditor and other debts; the public interest in encouraging creditors to provide indemnities so as to enable a liquidator to pursue remedies which would result in recovery of the property of the company; and all other relevant circumstances. I have considered all of these factors and the chronology of events. Clearly, the exercise of the discretion under s 564 of the Corporations Act in such a way as to prefer an indemnifying creditor to that of the liquidator in payment of his claim for the expenses properly incurred in preserving, realising or getting in property of the company, would be very unusual. In Jarbin Pty Ltd v Clutha Ltd (in liq) (supra) an order was made for distribution of the settlement sum on the assumption that allowance would be made for the payment of recovery expenses of the liquidator and his advisers. The authorities do not reveal any examples of an advantage being conferred upon an indemnifying creditor in priority to the costs of recovery of the property. In the present circumstances, there are two factors which seem to me to be particularly important in weighing all the factors. First, the settlement sum was not brought about simply by reason of the provision of the indemnity. Plainly, the indemnity was catalytic. However, there is no doubt that the continuing recovery action by the liquidator and the solicitors for the liquidator during the second half of 2007 and 2008 completed the chemistry of that reaction, brought the negotiations to a head and resulted in a settlement agreement. No criticism can properly be levied against the Deputy Commissioner for failing to join in that settlement even though such a step might have been productive of an additional $15,000.00 elevating the settlement sum to $100,000.00. The Deputy Commissioner is charged with the important responsibility of protecting the taxation revenue of the Commonwealth by enforcing the taxation laws and properly exercising administrative discretions conferred upon him or her. The price the Deputy Commissioner was being asked to pay in joining in the settlement was the granting of a release and discharge of the relevant taxpayers. Plainly, that release would have been inappropriate simply as an exercise in facilitating a settlement of the liquidator's claims. The material shows that the proposed release was not based on any assessment by the Deputy Commissioner of the liability of the taxpayers in connection with their performance or otherwise of taxation obligations. The second factor is the apparent acceptance by the liquidator that the Deputy Commissioner would be entitled, in principle, to payment from the recovered monies of the amount of the indemnity. That "in principle" position may not have been informed by the possibility that the value of the recovered property or monies obtained in settlement would not exceed the costs of recovery steps or proceedings. Perhaps the liquidator assumed or alternatively the parties assumed that the present question brought before the Court would not arise in the way that it has. However, the liquidator's correspondence and the Indemnity Agreement seem to suggest that the indemnifying creditor was to be afforded priority in the recoupment of the indemnity from an amount recovered. Section 564 of the Corporations Act confers power to make such order as the Court deems just. Although an order conferring an advantage on the Deputy Commissioner to that of the liquidator in payment of recovery costs and expenses is unusual, it seems to me that the contribution of the three principal participants who have suffered a loss as a result of those contributions - in the case of the Deputy Commissioner, the provision of the indemnity in the amount of $30,000.00 and in the case of the liquidator and his advisers, the steps or activities undertaken by them in pursuing recovery action to a settlement conclusion ought, in principle, to be borne rateably. Therefore, on the question of whether the Deputy Commissioner should be given an advantage over the liquidator in respect of the entire $30,000.00 provided by way of indemnity in respect of the identified steps, the approach I propose to adopt is this. The liquidator is out of pocket in the sum of $52,553.88. The solicitors for the liquidator are out of pocket $32,829.02. The Deputy Commissioner is out of pocket $30,000.00. The Deputy Commissioner is also, of course, out of pocket to the extent of the debt due by the company but no part of that debt is recoverable in any event. The additional out-of-pocket expenditure made by the Deputy Commissioner is the indemnity of $30,000.00. The aggregate of the out-of-pocket amounts is $115,382.90. Having regard to the proportion of the liquidator's out-of-pocket costs and expenses to the total, the liquidator would receive $13,664.21 of the $30,000.00 based upon a calculation of $52,553.88 divided by $115,382.90 multiplied by $30,000.00. Applying that formula, the proportion of the $30,000.00 attributable to the solicitors would be $8,535.67 and the proportion of the $30,000.00 attributable to the Deputy Commissioner would be $7,800.11 (that is, $30,000.00 divided by $115,382.90 multiplied by $30,000.00). Accordingly, it seems to me that the Court should order that an amount of $7,800.00 be paid out of the recovered monies to the Deputy Commissioner in order to give the Deputy Commissioner that proportionate degree of advantage over the liquidator in respect of the liquidator's claim for payment of his costs and expenses of recovery action, in consideration of the risk assumed by the Deputy Commissioner in providing the indemnity. In respect of the costs incurred by the parties in making this application, it seems to me that the costs ought to be paid out of the monies recovered in undertaking the recovery steps. I certify that the preceding forty-seven (47) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood. | consideration of an application by a liquidator for an order in relation to the distribution of a settlement fund having regard to an indemnity provided by the deputy commissioner of taxation as an unsecured creditor in the winding up consideration of the terms of an indemnity agreement consideration of the role of the liquidator as contradictor of a claim by the indemnifying creditor to payment of the indemnity monies in priority to the costs and expenses of the liquidator properly incurred in preserving, realising or getting in property of the company consideration of s 556(1) of the corporations act consideration of the scope of the power conferred by s 564 of the corporations act consideration of the relationship between ss 556(1) and 564 of the corporations act consideration of the question of whether the indemnifying creditor should be given an advantage over the liquidator in respect of the liquidator's expenses having regard to the particular circumstances corporations |
2 The Applicant contends that had each of the First and Second Respondents discharged a duty owed to the Applicant to exercise all reasonable care, skill and diligence as a competent valuer in preparing the valuation and security assessment; to describe the unusual features of the property including the unusual design of improvements to the property; to assign an appropriate risk rating to the property; to describe the unusual configuration of improvements to the property; and to record any deficiencies in the property detrimentally affecting the marketability of the property, Vero would not have issued the policy of insurance. 3 The Applicant also contends that the failure to adequately describe the unusual design of the property including its improvements, the assigning of a 'low' risk rating in respect of those improvements and the failure to state in the valuation that in order to achieve a sale of the property at or about the valuation a marketing period of up to 12 to 18 months was likely to be necessary, is the expression of conduct which was misleading or deceptive or likely to mislead or deceive Vero and constituted false or misleading representations concerning the nature of an interest in land and the characteristics of that land thus giving rise to contraventions of ss 52 and 53A of the Act. Although the Applicant contends that the Respondents owed a duty 'to describe any unusual features of the Property including the unusual design of improvements' and a duty to 'describe any unusual configuration of the Property's improvements', the Applicant contends in submissions that the duty was not one to describe the particular features of the improvements as 'unusual' but a duty to describe or identify the design feature thus placing the Applicant in a position to decide for itself whether those features or design characteristics were 'unusual'. 4 In addition, the Applicant contends that the Respondents did not have reasonable grounds for making the valuation and security assessment. 5 The Applicant further contends that in relying upon the valuation provided to it, the Applicant suffered loss and damage by ultimately paying Perpetual an amount of $96,733.17 on or about 13 September 2002 pursuant to the policy representing the loss suffered by the mortgagee arising out of the mortgagee's exercise of a power of sale of the subject property upon default by the mortgagor and suffered further loss and damage consisting of legal expenses incurred by the Applicant in seeking to recover that sum from the mortgagor pursuant to an assignment to Vero of the rights and interests of the mortgagee. The amount of those costs is $35,954.93 representing a total claim of $132,688.10. 6 The Applicant claims that sum from the First Respondent as damages for negligence or alternatively as compensation 'in whole ... for the loss or damage' pursuant to s 87 of the Act. The Applicant claims that sum from the Second Respondent as damages for negligence. In final submissions, the Applicant sought leave to amend the Application and the relief sought by the Further Amended Statement of Claim to include a claim for damages pursuant to s 82 of the Act ([25] of the Applicant's closing submissions filed 4 January 2006). The application for leave is resisted by the Respondents. 7 The Applicant contends that the valuation and security assessment document must be read in conjunction with the Australian Property Institute (API) Residential Valuation and Security Assessment Pro-forma Supporting Memorandum ('Supporting Memorandum') dated 8 May 1998 which guides the valuer in the completion of the two page pro-forma residential valuation and security assessment document. The content of the duty of care on the part of the valuer and the expression of a breach of that duty is, in part, informed by the Supporting Memorandum. 8 Put simply, the Applicant says that David Duffield ought to have disclosed in the valuation and security assessment document that the building on the site incorporated a design which limited access to four of the five bedrooms by means of an open-air verandah and that each of those four bedrooms involved use of a shared separate bathroom with an adjoining bedroom. Such a design is said to be 'unusual' in that comparatively few houses exhibit such a design and the proper discharge of the duties owed to the Applicant necessarily required disclosure of these two design features. 9 Secondly, the Applicant says that David Duffield ought to have disclosed in the pro-forma valuation report the circumstance that by reason of the unusual design features incorporated within the subject luxury house, it would necessarily take a lengthy period of time to secure a sale of the property within the limited field of buyers who might be interested in such a property and, more particularly, David Duffield ought to have disclosed that a marketing period of up to 12 to 18 months was likely to be necessary to secure a sale at the valuation price. Although I have described the Applicant's contention in this contextual way, the formulation of the breach of duty is not just that the property might require a longer marketing period than the orthodoxy of the Supporting Memorandum suggested but that 'a marketing period of up to 12 to 18 months was likely to be necessary'. 10 The contention is that had all these matters been disclosed, the Applicant would not have engaged in the transaction by issuing the policy and thus no risk would have been assumed at Vero at all. 11 The Respondents admit that they owed the Applicant a duty of care to exercise all reasonable care, skill and diligence as a competent valuer in preparing the valuation and security assessment. The Respondents also admit a duty of care owed to the Applicant to record in the valuation any deficiencies in the property that may detrimentally affect the property's marketability. The Respondents do not admit a duty to describe any unusual features of the property including the contended unusual design of the property's improvements. They say that these features are simply matters of professional opinion about which views might legitimately differ. Further, the Respondents say the Supporting Memorandum does not require disclosure of 'unusual' features and the assigning of a risk rating as part of the pro forma valuation report in large part depended upon the proper application and construction of the Supporting Memorandum. The Respondents also say that it is important to recognise that the improvements to the property were being valued by David Duffield consistent with its use by the mortgagor as a single residential dwelling. 12 The Respondents also contend that the insurer did not, upon proper analysis, rely upon the valuation because its officers elected to provide mortgage insurance to Perpetual prior to the receipt of the valuation report; that David Duffield undertook an inspection of the property and prepared a valuation report in a particular capacity on behalf of the First Respondent and in doing so did not assume a personal liability to the Applicant but rather acted at all relevant times in such a way as to give rise to a liability, if at all, in the First Respondent; and that the information disclosed in David Duffield's pro forma valuation report, assessed in conjunction with the Supporting Memorandum, conveyed sufficient information to the Applicant's officers that they ought to have either appreciated the character of the improvements or, alternatively, made further enquiry of David Duffield as to the improvements. Moreover, the failure to make such enquiry involves conduct on the part of the Applicant which has contributed to the loss now sought to be recovered from the Respondents and thus any award of damages or order for compensation ought to be reduced to the extent of the Applicant's contribution to its loss. 13 As to the conduct in contravention of s 52, the Respondents say that the content of or omissions in the valuation are simply matters going to an expression of professional opinion about which views might legitimately differ and a difference of opinion is not the expression of a breach of a duty of care. Nor can an expression of opinion, in such circumstances, it is said, constitute a misrepresentation. As to s 53A, the Respondents say that the representations, apart from any other matter, do not exhibit any relevant connection with 'an interest in land' or 'the characteristics of the land', in question. 14 At the commencement of the trial the Applicant elected to abandon a number of components of its case formulated in the Amended Statement of Claim. In the Amended Statement of Claim, the Applicant contended that the Respondents owed the Applicant a duty to ascertain the market value of the property, make sufficient and appropriate enquiries and investigations as to the value of comparable properties and to properly describe the use of the property. As to the question of breach, the Applicant had contended that the Respondents: failed to exercise due care, skill and diligence in assessing the market value of the property; ascertained a value that was not the market value; made insufficient or inappropriate enquiries as to value; and failed to record in the valuation that the marketability of the property was adversely affected by, first, there being no room to install a swimming pool and secondly, by the use of compressed fibrous cement in the construction of the house. The amendments abandoning these contentions are the subject of the Further Amended Statement of Claim filed on 8 December 2005. 17 Written objections to particular paragraphs of affidavits were exchanged between the parties. During the course of the trial, objections to evidence were dealt with as each witness was called and each affidavit tendered. 19 On 19 April 1999, Cornitus Cats and Bethwyn Cats (the "borrower") completed an application form addressed to Residential Housing Corporation Pty Ltd trading as Resi Home Loans ('Resi') for a loan to re-finance an existing house loan and for additional funds for investment, in a total amount of $400,000.00. The application document was lodged with Resi on 21 April 1999 and recites in the Assets and Liabilities Statement the residential property at 30 Latreille Terrace as one of the assets of the borrower at a value of $520,000.00. In another section of the same document, the 'estimated value' of the property is described as '$470,000.00+'. The Resi application document recites that the borrower has made an application for finance to Perpetual Trustees Victoria Limited and Permanent Custodians Limited ('Permanent') to be arranged by Resi. 20 On 22 April 1999, Resi submitted a proposal for lenders residential mortgage insurance ('L M insurance') to Royal & Sun Alliance Lenders Mortgage Insurance Limited ('Royal & Sun Alliance') now known as Vero Lenders Mortgage Insurance Limited, the Applicant. In these reasons, I will generally describe Royal & Sun Alliance as Vero. In the insurance proposal, the lender is described as Perpetual and the mortgage manager of the proposed loan on behalf of Perpetual is described as Interstar Securities Pty Ltd ('Interstar'). The proposal identifies a loan amount of $356,250.00 and recites that the 'loan application form, valuation/security assessment, all associated and supporting documents and details of further securities must be submitted with, and form part of, this proposal'. Plainly enough, the proposal document contemplates that a range of material and information will be assessed by the insurer in making a decision as to whether to accept the proposal and assume the risk. 21 From February 1998 to June 2000, Tome Zrilic was employed by Vero as an underwriter. Prior to 1998, Tome Zrilic had worked as a residential lending officer for a period of between two and four years at variously, Advance Bank, Commonwealth Bank and Aussie Home Loans and was responsible for approving residential housing loans. That role also involved the assessment of property valuations to ensure that the proposed security was acceptable from a lender's perspective and thus Tome Zrilic was familiar with the assessment of valuation reports. In 1999, Tome Zrilic was responsible for reviewing lenders mortgage insurance proposals put to Vero by or on behalf of Interstar. Often, such applications were submitted to Vero by a loan originator or loan arranger such as Resi. In the case of proposals made on behalf of Interstar, applications would often be submitted to Vero by Resi as the loan originator in circumstances where Interstar was acting as the manager of the loan application for Perpetual as the proposed lender and mortgagee. 22 In assessing a proposal for L M insurance, Tome Zrilic had regard to and was familiar with an important document prepared by the insurer described as the '1998 Lender's Mortgage Insurance Residential Credit Policy Manual for Prime Loans' ('the Policy Manual'). It contained the set of policies and key principles adopted by Vero against which judgments had to be made as to whether the proposal for L M insurance was acceptable. For example, the Policy Manual says the L M insurance policy was designed to provide indemnity to financial institutions such as Perpetual rather than individuals and no L M insurance policy would issue unsupported by acceptable real estate security in favour of the mortgagee. 24 The manual by section 1 (7 pages) sets out 17 partly qualified (in some cases) categories of acceptable sources of income available to a borrower to service the mortgage commitment and 15 categories of unacceptable sources of income. The manual also established ratios of the proportion of income that could be derived from particular categories of acceptable income presumably in order to ensure no over-dependence by the borrower on any one or two sources of income. 25 Section 2 A sets out a list of acceptable and unacceptable assets as the source of a borrower's minimum deposit obligation. 26 Section 2 B identifies a list of the categories of acceptable and unacceptable potential borrowers from the insured financial institution. For example, Australian residents, companies incorporated in Australia and Trustees are some of the acceptable borrowers; 'clubs, churches and Congregations' are not. Section 2 D sets out employment standards that must be achieved by the proposed borrower such as a minimum period of full time employment, permanent or part-time employment and other such matters. Section 2 E deals with the requirements relating to guarantors. Sections 3 A and 3 B deal with the categories of adverse credit risk and the range of credit checks to be undertaken concerning the proposed borrower from the financial institution. 27 Section 3 C sets out a matrix of the ten acceptable purposes for a loan the subject of the proposed L M insurance, the acceptable term of an interest only loan, the term of fully amortising loans and the percentage threshold of exposure the insurer is prepared to accept for each class of loan based upon a loan to value ratio described as an 'LVR'. For example, an 'owner occupied housing loan --- Refinance only' is acceptable on an interest only basis for five years at 90% of LVR. Alternatively, a fully amortising loan at 95% of LVR may be taken over a 30 year period. Section 3 D sets out 14 unacceptable loan purposes. 28 Section 3 E1 sets out a schedule of 'acceptable single/individual residential security' that might be the subject of L M insurance and a schedule of unacceptable residential security. Such factors include the affect of electricity pylons, noise affected property, country locations and prestige suburban areas. Section 3 F sets out the classes of acceptable and unacceptable land title offered as mortgage security in favour of the lender, the subject of the L M insurance proposal. The valuation must not be older than three months at the time of settlement of the relevant transaction and must contain three comparable sales within the last six months of the valuation date. 33 On 28 April 1999 David Duffield notwithstanding that the letter was addressed to 'Geoff Duffield --- Taylor Byrne', received a letter of instruction from Resi to provide a valuation of the property at 30 Latreille Terrace. In the letter of appointment Resi nominated an estimated value for the property of $520,000.00. He says that on average he received and processed approximately 20 to 30 proposals for L M insurance each day. Accordingly, Tome Zrilic has undertaken a process of examining the proposal document, the loan application, the valuation prepared by David Duffield and Taylor Byrne dated 5 May 1999 and a document described as a 'Residential Data Input Sheet' (R D Input Sheet) held by the insurer which is used to input data concerning the relevant transaction into the insurer's computer system. Based on Mr Zrilic's assessment of these documents, he says this in relation to both the usual practice he undertook consistent with the practice adopted by Vero in considering proposals for L M insurance and the documents he examined. 36 Approximately 40 percent of L M insurance approvals by Vero involved a 'pre-approval stage' followed by a 'final approval'. Pre-approval would occur without a valuation. A proposal for L M insurance was pre-approved on condition that the loan originator would later provide Vero with a valuation that was 'consistent with information about the proposed security put forward in the proposal'. If the valuation did not support the information supplied in the proposal or if the valuation suggested that the proposed property security was unacceptable, the proposal would be refused at the final approval stage. Pre-approval as a process was regarded as attractive to loan applicants as a proposed borrower would not incur the cost of a valuation of the proposed security until the lender's mortgage insurer was satisfied that the proposal was otherwise acceptable. 37 In relation to the R D Input Sheet, Mr Zrilic says the handwriting appearing on the document is largely his handwriting. The signature which appears next to the word 'Recommended' is his signature. Whilst Mr Zrilic has no specific recollection of completing the R D Input Sheet concerning the subject proposal, he says from examining the document that the likely course is that the security details in the boxes on the form were completed using information drawn from the proposal or the loan application. Mr Zrilic says it was his practice to check those details on the R D Input Sheet against the valuation once the valuation had been received by the insurer. 38 The column on the R D Input Sheet headed 'Value' contains an amount of '$475,000' and a date '5/5/99'. Mr Zrilic says that consistent with his practice and having regard to his own handwriting, he inserted the amount and the date by reference to the valuation. In addition, Mr Zrilic says that it was his practice to complete (that is, mark) the codes on the form to identify the policy type, security type and loan purpose which in this case are marked as codes 10 (owner occupied property), 42 (a residential house) and 08 (a refinancing transaction) respectively. Although Mr Zrilic cannot recall whether those codes were marked by reference to the valuation or the loan application, he says it was his practice to check and confirm those details against the valuation once the valuation was submitted to the insurer. Had the security proposed by the borrower been considered by Mr Zrilic to be 'poor or unacceptable', it was his practice to note on the R D Input Sheet that the security was 'Adverse'. Mr Zrilic says that such a judgment would be made by him based upon the description of the property set out in the valuation. Mr Zrilic might have considered the proposed security as poor or unacceptable having regard to the Policy Manual or 'for some other reason ... from a lenders mortgage insurers perspective'. Mr Zrilic says that the amount nominated on the R D Input Sheet as the total loan was noted by him as $356,250 and the notations on the form next to the word 'Agency' (K28083) is a reference to Resi and the number noted against the term 'P/N' (901078) is a reference to the policy number. At the pre-approval stage a policy number would be allocated subject to final approval. 39 Mr Zrilic says that data input and policy issuing procedures adopted by the insurer meant that it was not possible for an L M insurance policy to issue without the valuation date and valuation amount appearing on the R D Input Sheet. Both the valuation date and the amount of the valuation were mandatory fields that had to be keyed into the insurers database in order to generate a policy. Mr Zrilic says that his practice was that once a proposal was pre-approved, he would inform the loan originator who would then be responsible for obtaining the valuation and referring a copy of it to the insurer. Mr Zrilic says that once the valuation was received it was his practice to read the valuation, consider whether the property described in the valuation was consistent with the pre-approved details contained on the R D Input Sheet and then complete the data input sheet. Steven Ramage commenced work with Vero as Victorian State Manager and was responsible for L M insurance policies issued in Victoria. In 1998 the insurer centralised underwriting nationally at Chatswood in New South Wales. Mr Ramage was transferred to Chatswood and assumed responsibility for underwriting on behalf of the insurer nationally. Each underwriter was subject to a 'State exposure restriction' known as an 'SER'. If a loan exceeded a particular underwriter's SER (that is, the individual's SER), the underwriter had to obtain Mr Ramage's approval to proceed to issue an L M insurance policy. 42 Mr Ramage says that his signature appears on the R D Input Sheet next to the word 'Approved' at the bottom of the sheet. Mr Ramage, like Mr Zrilic, has no specific recollection of signing the R D Input Sheet for this transaction nor does Mr Ramage have any recollection of the L M insurance application by Interstar originated by Resi concerning the application by Cornitus and Bethwyn Cats. Mr Ramage says that since his signature appears on the R D Input Sheet it is likely that the loan exceeded Mr Zrilic's SER. Mr Zrilic's SER in May 1999 was $185,000. Mr Ramage also says that since the date adjacent to his signature, '29/4/99' pre-dates the valuation date on the R D Input Sheet it is likely that the application for L M insurance had been approved subject to a satisfactory valuation. Mr Ramage has no recollection of whether he read the valuation prior to 19 May 1999 which is the date on which the insurer issued a Cover Note. Mr Ramage says that the individual underwriter was not required to show him a copy of the valuation once a proposal had been pre-approved subject to a valuation even if the proposed loan exceeded the SER for the individual. Each officer or underwriter exercised a discretion as to whether the valuation provided to the insurer ought to be shown to Mr Ramage. Mr Ramage was often consulted when an underwriter had some cause for concern about the property security described in the valuation. 43 In reviewing the R D Input Sheet Mr Zrilic says that he would have inserted as the total loan amount an amount of $400,000.00 as the potential amount of the loan based on the application document. He then altered that amount by inserting the amount to be actually lent consistent with the LVR. Mr Zrilic says that he recommended a full approval of the proposal and endorsed and signed the proposal as approved on 19 May 1999 leading to the issue of Cover Note F28083 with an expiry date of 19 August 1999. The issue of the Cover Note bound Vero to issue a policy subject to the payment of a premium ($522.00). The policy in fact issued on 8 September 1999. Even though neither witness has a present independent recollection of the specific events, I accept that Vero's underwriting practices and policies and the extant documents establish that the course of events involved the submission of a proposal, a pre-approval of the proposal, the submission to Vero of a copy of a valuation undertaken by David Duffield and Taylor Byrne, an assessment of the valuation by Mr Zrilic, a recommendation of approval of the proposal by Mr Zrilic and an approval of the proposal by Mr Ramage leading to the issue of the Cover Note on 19 May and ultimately a policy of L M insurance on 8 September 1999. 45 In addition, the respondents contend that the applicant has not demonstrated reliance upon the valuation in any material way other than confirmation of the valuation amount. It was put to Mr Zrilic in cross-examination that he did not 'read' the valuation and he denied that proposition. I accept and find that Mr Zrilic read the valuation. I accept and find that Mr Ramage probably did not read the valuation but relied upon Mr Zrilic's assessment of it leading to Mr Zrilic's recommendation of approval. In reliance upon that recommendation, Mr Ramage approved the proposal as the amount of the loan exceeded the SER limit applicable to Mr Zrilic. 46 Importantly, the process of pre-approving and more particularly, finally approving applications for L M insurance is a core business process for Vero. The process is the subject of protocols and a prescriptive policy manual especially in relation to the insurer's approach to valuation. The policy manual sets out a wide range of policy positions in relation to each category of risk associated with issuing L M insurance policies. Mr Zrilic and Mr Ramage, (but in particular the underwriting officer dealing with the transaction, Mr Zrilic) are the defenders at the gate for the insurer in containing risk and exposure and in dealing with those things that the insurer considers attract a particular level of criticality in the approval process. They are experienced writers of L M insurance policies. They are astute to the requirements of the Policy Manual and the importance of the valuation process. They are experienced and informed readers of valuations and they are required to bring an enquiring mind to the assessment of a valuation and the role a valuation plays in the assumption of risk in relation to the particular transaction in question. 47 I find that Mr Zrilic read the valuation and in doing so was required to read it critically and thoroughly [31]. The Pro-forma Report notes that 'This report is made in accordance with the Australian Property Institute (API) Residential Valuation and Security Assessment Pro-forma Supporting Memorandum dated 8 May 1998 and must be interpreted with that Memorandum'. In cross-examination, Mr Duffield accepted that a reader of the valuation would be an officer of a mortgage insurer and that, in this case, the valuation had been prepared for use of, among other persons, Royal & Sun Alliance and that it was Mr Duffield's expectation that an officer of that company would rely upon it in making a decision whether to grant insurance and, if so, the level of insurance risk the insurer might assume (transcript pages 164 and 165). He completed an Associate Diploma in Real Estate Valuation in 1986 and became a registered urban valuer in 1987. Mr Duffield has been based in Cairns for his entire professional career and has had extensive experience in valuing property in the Cairns marketplace. From 1984 to March 1987 Mr Duffield was an assistant valuer in the Department of the Valuer General in Brisbane. In Mr Duffield's Curriculum Vitae he says that he joined the Cairns office of Taylor Byrne in March 1993 and became a director of the Taylor Byrne 'Cairns' entity in June 1996. Although Mr Duffield is a director of the Cairns entity, he acknowledges that he prepared the valuation as agent for the first respondent. The valuation is signed by Mr Duffield and simply bears the description 'Taylor Byrne'. A duty owed to the Applicant to exercise all reasonable care, skill and diligence as a competent valuer is admitted by the Respondents. However, the Respondents contend that because the valuation was completed by Mr Duffield for and on behalf of the First Respondent, Taylor Byrne, Mr Duffield did not assume personal responsibility for the valuation. The valuation was undertaken by Mr Duffield, it is said, in a particular capacity as agent for the First Respondent and thus any tortious liability subsists in the First Respondent to the exclusion of the Second Respondent. 51 The position, however, is this. 52 The First Respondent carried on the business of a valuer and held itself out to the Applicant as possessing skill and expertise in the valuation of land (paragraphs 1, 2 and 3 of the Further Amended Statement of Claim, admitted by the Respondents). Mr Duffield was the agent of the First Respondent for that purpose. Mr Duffield owed a duty to exercise all reasonable care, skill and diligence as a competent valuer. In undertaking the valuation, it is plain from the description of the lender specific information [32] that both Taylor Byrne by its agent, Mr Duffield, and Mr Duffield knew and understood that Royal and Sun Alliance was likely to rely upon the valuation in deciding whether to accept a proposal for mortgage insurance. Thus, a claim for economic loss in the absence of physical damage subsists as a recognised tort ( Caltex Oil (Australia) Pty Ltd v The Dredge Willemstad [1976] HCA 65 ; (1976) 136 CLR 529; Perre v Apand [1999] HCA 36 ; (1999) 198 CLR 180) both against the author of the negligent act and his principal as a function of a direct duty relationship (assuming breach causative of loss). As to a the liability arising upon a conscious assumption of responsibility for a task, see White v Jones [1995] UKHL 5 ; [1995] 2 AC 207 at 294 per Lord Nolan and at 274-275 per Lord Browne-Wilkinson. The source of the duty owed by a valuer to a financier in the absence of contractual relations in circumstances where the valuer expected the financier would rely upon his valuation, has been described as 'equivalent to contract' ( Kenny & Good Pty Ltd v MGICA (1992) Ltd [1999] HCA 25 ; (1999) 199 CLR 413 at 434 and 446; Nocton v Lord Ashburton [1914] AC 932 at 972; Hedley Byrne & Co. Ltd v Heller & Partners Ltd [1963] UKHL 4 ; [1964] AC 465 at 529-530). An element of the source of the duty may also be whether there is 'a complex of other factors [combining] to summon into existence a duty of care' between the valuer and the party seeking to establish a tortious liability arising out of reliance upon the valuation. That complex of factors is sometimes described as 'linking conduct'. ( Interchase Corporation Limited (in liq) v Grosvenor Hill (Queensland) Pty Ltd (No. 3) (2003) 1 Qd.R 26 at 38, per McPherson JA [25]; Hill v Van Erp [1997] HCA 9 ; (1997) 188 CLR 159 at 234 per Gummow J). 53 The position is no different as between Mr Duffield and the Applicant as mortgage insurer, in the circumstances of this case. 54 Apart from a direct duty relationship, the First Respondent as the principal of Mr Duffield is vicariously liable for a tort committed by its agent in the course of or within the scope of the agency relationship. It is not contested by the Respondents that Mr Duffield was the agent of the First Respondent. In fact, it is the specific capacity of Mr Duffield which is relied upon as the foundation for a liability in the principal rather than the agent in the absence of evidence of an assumption of liability by the agent. 55 This notion seems accurately described as 'an inversion of the whole doctrine' of vicarious liability ( Interchase v Grosvenor Hill [77], per McPherson JA). Vicarious liability arises where one person is held liable for the wrongful act or omission of another even, in some circumstances, if the specific act or omission was unknown to that other person at the time it occurred. Vicarious liability is imputed, for example, to an employer for the torts of an employee committed in the course of employment and to a principal where the agent commits a tort whilst acting in a representative capacity. An analysis of those things done by an employee or an agent that fall within the scope of employment or the representative capacity of the agent will often involve a consideration of 'functional, geographic and temporal elements' and a recognition that not everything done by the agent will be sufficiently connected with the duties and responsibilities the agent is appointed to discharge for his principal, as to be regarded within the scope of the agency. In that sense, an agent or employee may step outside the scope of the agency or employment and engage in a 'frolic' ( Morris v C W Martin & Sons Ltd [1966] 1 QB 716 at 733 --- 734). A question might arise as to whether the acts of the agent are to be regarded as sufficiently connected with 'authorised acts' within the representative capacity as to be modes, although perhaps improper modes, of undertaking authorised acts or whether the acts are truly 'independent acts' ( State of New South Wales v Lepore & Anor [2003] HCA 4 ; (2003) 212 CLR 511 at 536 [42] per Gleeson CJ). 56 No such question arises in this case. 57 The proposition is that in the absence of an assumption of liability by the agent, only the principal is susceptible of tortious liability. However, where vicarious liability exists, the person who commits the tort and the person vicariously liable for the tort are regarded as joint tortfeasors ( The Koursk (1924) 18 Ll L Rep 153; [1924] P 140). The agent who commits a tort within the scope of his employment for his principal, and the principal; the servant who commits a tort in the course of his employment, and his master; two persons who agree on common action, in the course of, and to further which, one of them commits a tort. These seem clearly joint tortfeasors; there is one tort committed by one of them on behalf of, or in concert with another. In Thompson v Australian Capital Television Pty Ltd [1996] HCA 38 ; (1996) 186 CLR 574 their Honours Brennan CJ, Dawson and Toohey JJ at pp580, 581 recognised that when an agent commits a tort when acting within the scope of the agency or when a servant commits a tort in the course of employment, both the principal and agent or employer and employee are responsible for the same tort and are joint tortfeasors . The various Law Reform Acts of the states and territories have now abolished the rule that a cause of action against joint tortfeasors merges in a judgment obtained against one of them thus presenting a bar to action against other joint tortfeasors. An example of such legislation is s 6 of the Law Reform Act 1995 (Qld). 59 Vicarious liability is not a doctrine that posits a liability in the principal and operates to excuse or disqualify the liability of the agent for a tortious act or omission. 60 In this case, there is both a direct duty relationship established between the Applicant, Mr Duffield and Taylor Byrne, and a vicarious liability in Taylor Byrne derived from the commission of a negligent act (if proven) by Mr Duffield in the course of the agency relationship. In any event, it seems to me that Mr Duffield's evidence establishes a clear assumption of duty on his part which is not displaced in favour of his principal by force of his agency capacity. The content of the duty and the question of breach causative of loss is dealt with in these reasons. The first section is a 'Property Summary' which identifies the property address, title details including site dimensions, site area, the relevant zoning instrument, a description of the main building, year of construction, car accommodation, the square metre area for living areas and outdoor areas, a statement as to the marketability of the property, the total site area and the current use of the property. In this case, Mr Duffield described the site dimensions as 'irregular'; the main building is described as 'dwelling with 5 bedrooms 5 bathrooms'. The car accommodation is described as '5 car carport'. The current use is described as 'single residential' and the marketability is described as 'Average'. 62 The second section is headed 'Risk Analysis' and that section deals with two topics. The first is 'Property Risk Ratings' and the second is 'Market Risk Ratings'. The risk ratings are these '1 = Low, 2 = Low to Medium, 3 = Medium, 4* = Medium to High, 5* = High'. The asterisk directs the reader to this instruction '*MUST "comment" over page on any 4 or 5 Risk Ratings, or if three or more "3" Risk Ratings'. 65 In respect of the Property Risk Ratings, Mr Duffield attributed a risk rating of 2, 1, 1 and 1 in the order of the categories set out at [62] and a risk rating of 2, 2, 1 and 1 in the order of the categories set out at [63]. The method of presentation of the risk ratings also involved a graphic barcode depiction of the rating highlighted in black displaying the bar filled to the level of the relevant rating 1 to 5. 66 Section 3 is headed 'Valuation & Assessment Summary'. That section describes the interest valued ('Fee Simple vacant possession'), the value of the land and improvements, the rental value of the property unfurnished and the level of replacement insurance. Mr Duffield attributed a value of $125,000.00 to the land and $350,000.00 to the improvements constituting a "market value' of $475,000.00. 67 Section 4 contains a description of the 'Land' including the location, neighbourhood, site description and access and a description of the services available to the property. Mr Duffield described the location in this way 'The property is situated in the suburb of Brinsmead, being approximately 11 kms north-west of the city centre. ' As to neighbourhood, Mr Duffield said: 'The subject property is located in an established neighbourhood which generally comprises dwellings of average quality. ' As to site and access, Mr Duffield said: 'Steep sloping lot which rises from the street frontage. Vehicular access is direct. 70 Section 7 sets out information in relation to the topic of 'Sales Evidence & The Market'. In that section, Mr Duffield identified three properties, the sale date, price and features of each property which rendered those properties either inferior to, similar with or superior to the subject property. That section also contained these comments 'Level of Market Activity: Steady' and 'Recent Market Direction: Static'. The property is on a semi elevated site which enjoys good views. However some finishing works are required to the dwelling and landscaping of the yard is also required. Our valuation has been assessed on the basis of the property in its present condition. Attached to the two page Pro-forma Report is a photograph of the allotment and residential dwelling looking towards the front of the structure. Pro-forma Report for mortgage purposes. While this is primarily to facilitate easy checking by the ... mortgage insurer, it is recommended that the whole report be read. The risk analysis on the front page with its graphic presentation particularly serves to draw immediate attention to any risks rated 'Medium to High' or 'High' and to appropriate comments later in the report. It is intended that this will not merely provide 'point in time' information but also forward looking advice to provide guidance to the client on the period of initial exposure. However, inherent and external features impacting significantly on the property should be adequately noted ... Where required, the 'Comments' section can be expanded to cover less common properties and 'one off' situations. If it is not in keeping with market expectations for the area, does it adversely impact on ease of sale? How do the inherent and external features of the property impact on its market appeal? Does it have features which could make the property harder than average to sell? Low ratings need to be explained in 'Additional Comments' (marketability in this instance is not intended to be a comment on the condition of the market). Any other significant risks identified, which do not come under these aspects, should also be commented upon in 'Additional Comments' . High adverse impacts or high risks are rated as '5' and are graphically depicted as a long bar. The extent of their individual adverse impact can vary significantly, so no attempt is made in this memorandum to provide a standard grading for various impacts. Properties often have many beneficial features. Adverse impacts need to be weighed against strengths or favourable impacts under the same aspect. However a comment would be warranted on a significant adverse impact (that individually would rate '4' or '5' but is off-set by strong beneficial impacts in the same aspect to produce an overall rating below '4') . For example, there may be evidence of old, minor white ant damage that justifies a pest report as a precaution. As a further example, a 1.8 metre high retaining wall beside an in-ground pool is badly cracked and has bowed out considerably. This has a significant adverse impact on the value of the property due to the cost to make good. This could increase the risk by reducing its marketability and increasing the selling period. It is a forward looking summary rating taking into account aspects affecting, or likely to affect, the value of the property. While this will reflect historical performance, reasonably foreseeable events should also be taken into account if they are likely to change the pattern of volatility. Real estate markets are dynamic and subject to change. However, several of the aspects under Market Risk Ratings heading should be helpful in indicating the 'Sustainability' of the assessed value level. The figure will normally be arrived at after consideration of several valuation approaches such as Sales Comparison and Summation. It should reflect a typical marketing period for the class of property . In such circumstances, the valuer should also provide a statement of the dynamics of that market in the 'Additional Comments' section. That person must be appropriately qualified and experienced in accordance with the current requirements of the Institute. A person signing in this capacity is merely authenticating the report as from that firm. It should not be construed as endorsing or co-signing the valuation. Additional comments can be made about the content of other sections of the report but it should be comment that enhances or elaborates on what has already been provided and not merely repeats what has already been stated. This section can also be used to explain any unusual aspects that the format does not specifically address. A balanced view of the property and market should be presented. Adverse aspects should not be over-emphasised nor should favourable features be exaggerated. Comments can be in either narrative or dot point form. The Applicant says a marketing period of 12 to 18 months to realise a sale at the valuation price was likely to be necessary. The Applicant further says Mr Duffield's election to assign a low risk rating of 1 to the property's improvements is consistent with a failure to recognise and describe the two unusual features. 76 The Applicant says the exercise of reasonable care compels a description of these two features by a valuer acting prudently. 78 The structure is a split level dwelling with 5 bedrooms and 5 bathrooms constructed on an allotment that slopes 'modestly to steeply upwards from road to rear and is relatively well elevated with views west'. The first level is entered from the back verandah (car parking is at the rear of the structure) by approximately six or seven stairs. The layout of the first level comprises an entry area, kitchen, study, dining and lounge areas and a master bedroom and ensuite which occupies one side of the first level to a width of approximately 5.4 metres in a structure 11.4 metres wide (left to right looking at the front elevation of the structure). A set of internal stairs connects the first level to the second, the layout of which comprises a family room, rumpus and games area and a television and home theatre area. Each level incorporates an extensive front verandah. 79 In order to access the second, third, fourth and fifth bedrooms, it is necessary to go to the entry area on level 1 adjacent to the master bedroom, step outside the entrance door onto the back entrance verandah, immediately turn left and commence walking up what appears from the plan to be three stairs of a covered stairway which are located immediately adjacent to the entry/exit door for level 1. 80 A further three or possibly four stairs as part of the covered stairway effect a right angle turn to provide access to a covered verandah approximately 1.8 metres wide. Access is gained to each bedroom from the verandah located along a wing or extension at the rear of the structure. The first unusual feature is said to be access to bedrooms 2-5 by this means rather than by internal access contained within the structure itself. 81 The second unusual feature is said to be that bedrooms 2 and 3 share a bathroom and bedrooms 4 and 5 also share a bathroom. 82 In order to adduce evidence that from a valuation perspective, these two features are ones which ought to have been described in the Pro-forma Report by a prudent valuer, the Applicant called expert evidence from Mr Paul Lowis. Mr Lowis is an associate member of the Australia Property Institute ('API') and holds a Bachelor of Business Degree from the University of Queensland with a major in 'Property Studies'. Mr Lowis gave evidence that he has extensive knowledge and experience of both the Cairns market and the preparation of valuations for mortgage lending purposes. Mr Lowis estimates that over the last five years, he has valued approximately 6,000 residential properties for mortgage security purposes using the API Pro-forma Report. Mr Lowis says that approximately one third of these properties were located in Cairns or within close proximity of Cairns. Mr Lowis says that he travels from Townsville to Cairns every week and generally stays in Cairns for four days a week. Mr Lowis says that he has an extensive knowledge of the style of valuation required by the API pro-forma valuation document completed by Mr Duffield on 5 May 1999. Mr Lowis also says that he has an understanding of the Supporting Memorandum 'to ... what would be expected of a competent valuer'. I have been provided with a copy of the valuation prepared by the first respondent and second respondent dated 5 May 1999, a copy of which appears in annexure "E" ( Valuation ). The Valuation fails to make any comment in relation to the Property's unusual design to the extent that access to four of the Property's bedrooms is via an open-air veranda. I would expect a prudent valuer using the Pro-forma Report to make reference to the Property's unusual layout, by inserting words such as "access to bedrooms 2-5 is via an open-air veranda". The first is a 'Property Design Report' dated 23 March 2005 and the second is a copy of a 'Valuation Report' prepared on the API Pro-forma Report format completed by Mr Lowis as if he was a valuer completing the document in May 1999 on instructions from a mortgagee. In other words, Mr Lowis has attempted to place himself in the shoes of Mr Duffield to prepare an API pro-forma report which reflects a statement of Mr Lowis's view of a prudently prepared pro-forma report. In the Property Design Report of 23 March 2005, Mr Lowis responded to the question, 'Does the Property have any unusual features or is the Property unusually designed? This design is unusual for Cairns. Normally, bedrooms in a residential dwelling can be accessed without having to leave the interior and without having to use a passageway that is not enclosed. Further, the second unusual aspect of the Property's design is that bedrooms 2 and 3, and bedrooms 4 and 5 have access to a shared bathroom. The two design features detailed above are unusual for a residential dwelling, and more commonly seen in dormitories/bed & breakfast style accommodation. I reached this conclusion for the following reasons. The Supporting Memorandum briefly outlines information to be provided in the Report where some clarification may be warranted. The Supporting Memorandum does not though provide any guidance in relation to the completion of the Interior Layout heading. This is because the design may discourage some purchasers who prefer internal access to bedrooms. Having solely external access to bedrooms raises issues in regard go the security of the dwelling. In addition, access to the bedrooms is open to external weather conditions, which may not be an attractive feature to potential purchasers. Accordingly, the Property may remain on the market longer, since more time than normal is likely to be required to find a buyer. Sale price may also be affected, should the vendor not be prepared to place the Property on the market for a lengthy period of time. Since the valuation in this instance was for mortgage purposes a design feature of this nature should be brought to the attention of the mortgagee. It has been my experience that mortgagees often require prompt sales of property security. This is a question that falls outside my relevant field of expertise being valuation and within the field of expertise of a real estate sale's agent involved in the marketing of residential property such as the subject in the Brinsmead/Cairns area. 89 As to Section 1 , Property Summary , Mr Lowis described the main building as a 'dwelling with 5 bedroom/s, 5 bathroom/s'; the Zoning/Instrument --- 'residential'; Marketability --- 'fair'. Mr Duffield adopted the same description for the main building, described the site dimensions as irregular and identified the current use as single residential. Mr Duffield described the marketability as 'average'. 90 As to Section 2 , Risk Analysis, Mr Lowis in addressing Property Risk Ratings allocated a Risk Rating of 1 (Low) to the topic of 'Location & Neighbourhood', ratings of 2 and 2 for 'Land' and 'Environmental Issues' and a rating of 1 for 'Improvements'. As to Location, Mr Duffield had nominated a higher risk than Mr Lowis and as to Land and Environmental Issues, Mr Duffield thought the risk was lower at 1 in each case. As to the risk to the insurer associated with the Improvements on the site, both Mr Lowis and Mr Duffield nominated a low risk of 1. 91 As to the Market Risk Ratings , Mr Lowis nominated a risk rating of 3 concerning 'Reduced Value next 2---3 years', a rating of 2 for 'Marketing Volatility', a rating of 3 for 'Local Economy Impact' and a rating of 2 for 'Market Segment Conditions'. Mr Duffield had nominated a risk rating of 2 for 'Reduced Value next 2 to 3 yrs'. Both Mr Duffield and Mr Lowis agreed as to the 'Market Volatility Risk', namely, a risk rating of 2. Mr Lowis and Mr Duffield disagreed as to the scale of the risk associated with 'Local Economy Impact' (a risk rating of 3 and 1 respectively). Mr Duffield thought 'Market Segment Conditions' presented a 'low' risk to the insurer whereas Mr Lowis took the view the risk was 'low to medium'. 92 As to Section 4 , 'The Land' , Mr Duffield had described the property as located in an established neighbourhood generally comprising dwellings of average quality. Mr Lowis suggested that the property 'is located in an established residential area with a good standard of housing. The subject property compares favourably with surrounding development and is situated in relatively close proximity to all major services including shopping, schooling and recreational facilities' . Mr Lowis described the site description as 'slopes moderately to steeply upwards from road' whereas Mr Duffield described the site as a 'steep sloping lot'. 93 As to Section 5 , 'Main Building', Mr Lowis described the internal and external conditions as 'good' as opposed to the description adopted by Mr Duffield as 'very good'. Both valuers agree that the 'street appeal' was of 'average appeal'. Mr Lowis adopted a more descriptive position in relation to the 'interior layout' of the structure. Mr Lowis described the layout as 'open living floor plan with larger than average sized living areas and bedrooms. Access to bedrooms 2---5 is via an open air veranda' . Each valuer identified comprehensively the features of the accommodation in terms of 5 bedrooms, 5 bathrooms, kitchen, dining, lounge etc and the range of PC items. The dwelling is in good condition overall and appears to be well maintained. The dwelling is situated on a moderately to steeply sloping allotment which is well elevated and offers good views to the west. Mr Lowis did not use the description 'unusual' or any particular synonym for unusual in describing the main building in section 1 or any aspect of the building in section 5. Nor did Mr Lowis make reference to 'unusual design features' in the 'Additional Comments' section of the model report. The question of 'access to bedrooms 2 --- 5 via an open air veranda' is the feature Mr Lowis mentions and that matter is noted as a matter of 'interior layout'. 95 As to the description of the 'marketability' of the property, Mr Lowis agreed that 'fair' and 'average' are both 'very open words' and that 'fair', as a description of marketability, lies somewhere between 'bad' at the lowest end of the scale and 'good' at the top end of the scale. 96 Mr Lowis was taken to the reference to 'marketability' in the Supporting Memorandum which suggests the valuer should adopt a brief comment on marketability or, alternatively, incorporate comments in the 'Additional Comments' section if the property exhibits inherent or external features (which could make the property harder to sell) [74]. Mr Lowis accepted that his adoption of the description 'fair' suggested he had formed a view that there were no inherent design features of the property that made it difficult to sell. However, Mr Lowis said the word 'fair' as a comment on marketability was a word he ought not to have used because he was unaware of and had not studied the marketability of the property at the time of preparing the model valuation. Mr Lowis was taken to the possible difference in his mind between the notions of 'marketability' and 'saleability' and was asked to assume 'marketability' for the purposes of a Pro-forma Report was a reference to a 'design feature' (which Mr Lowis had studied in order to prepare a report). Counsel for the Respondents put to Mr Lowis that had any particular design feature struck him as affecting marketability, he would have used the term 'bad' or 'good' in the model report. Mr Lowis responded that 'fair' was a 'fairly standard' 'rating' he would use and observed that the issues with the property may not have affected its saleability if the market was 'good'. Mr Lowis accepted that he was very familiar with the Supporting Memorandum, the Pro-forma Report format and the terminology adopted by the report format. 97 As to the ' Property Risk Ratings ', Mr Lowis considered that the appropriate risk rating derived from the 'Location and Neighbourhood' was 'low' (1) as the property is a 'hillside residential luxury property'. As to the risk to the insurer derived from the 'Improvements', Mr Lowis thought the risk was low (1) as did Mr Duffield. Mr Lowis was taken to that part of the Supporting Memorandum dealing with the recommended approach to the assessment of 'improvements' risk, namely, '... the improvements may not be in keeping with the expectation of the locality. This would increase the risk by reducing its marketability and increasing the selling period' , and was asked whether he agreed that his assigning a rating of 1, as if doing so at 5 May 1999, meant there was nothing about the improvements that suggested features not in keeping with the locality. Mr Lowis agreed in part only. I haven't done that research, so, again, it's not something that I can answer and that's why I don't agree in full with you. 99 Mr Lowis was asked the following questions. [Mr Lowis was interrupted and continued]. I think that if I went out and did the valuation when Mr Duffield did the valuation in 1999 that I would have probably have used similar risk ratings as to what he did or what I used. It's a very similar thing. It's a matter of professional judgment which rating you apply; isn't that so? Do you agree? Do you agree with that? That's why you adopted them, isn't that so? Isn't that so? ... I do disagree that there's --- I mean obviously, you can see on the pro-forma that if there's more than three, 3 risk ratings, that there's --- comments have to be made as to why. Is that your understanding, as well, of the requirements of the memorandum? That must mean that your assessment of the property was that there was no real risk in respect of this particular property; isn't that so? Yes. Mr Lowis agreed that 'luxury houses' as a broad description of the tier of the market in Cairns in May 1999, reflected a range of values within a 'very broad price range' of $350,000 to $750,000. 101 The range of values for 'typical houses' below the luxury market segment in 1999 was $100,000 to $350,000. 102 Although Mr Lowis described the feature of concern to him as 'access to bedrooms 2-5 is via an open-veranda ', Mr Lowis acknowledged that the structure incorporates a roof over the verandah. However, in the event of rain or wind, the verandah is exposed because it is not an enclosed verandah. Mr Lowis says that this is the 'real differentiated point'. 103 Mr Lowis was then taken to plans and photographs for a series of houses which the Respondents say are examples of houses in the luxury house market segment in Cairns that reflect similar but not identical features to the differentiated feature identified by Mr Lowis. Mr Lowis confirmed that he conducted an inspection of properties numbered 1, 2, 3, 6 and 13 identified at [104] all of which were roadside or kerbside inspections. Mr Lowis did not inspect the properties numbered 4, 8, 10, 11 and 12 at [104]. Mr Lowis inspected the properties numbered 2, 3, 5, 6 and 9 on the list identified by Mr Harris [106]. 108 Mr Lowis says that there are one or two properties within these examples that have similar features to the house at 30 Latreille Terrace. 109 As to No. 5 Queenley Close, Edge Hill , Mr Lowis considers the relevant patio access between the detached living area and the bedrooms to be much wider with a much wider roof than the subject property thus restricting rain and wind from invading the floor area of the patio. Further, because the bedrooms and living areas are built around the patio, the level of security is greater than the subject property. 110 As to No. 23 Darkin Close, Smithfield , Mr Lowis considered the property similar to the subject property with narrower verandahs. However, the plans were difficult for Mr Lowis to read. 111 As to No. 45 Kewarra Street, Kewarra Beach , Mr Lowis says the house plan exhibits narrow verandahs with access to bedrooms from the verandah. It is not clear to Mr Lowis from the plan whether there is also internal access to the bedrooms. However, Mr Lowis says that given that the verandahs are narrow, he assumes that the verandahs 'would be exposed to a degree probably as much as the subject property'. Mr Lowis says the plan exhibits a much bigger open patio area which would give protection from the elements. Mr Lowis says that the verandahs are similar but the access is 'certainly different' and therefore the house design is not one which is similar to the subject property. 112 As to No. 10 Stratford Chase, Stratford , Mr Lowis says that the floor plan reflects the use of breezeways in the patio area but, like the other floor plans, there is more protected access points from the separated living areas. Although there are detached areas, there will always be 'cover through to your detached areas'. Mr Lowis accepted that the floor plan reflected a similar design to the subject property in its use of detached living areas and bedroom areas. Access on the right hand side of bedroom 1 would be exposed to the elements having regard to the roof line of the structure. Access is provided to two further bedrooms from a main verandah which 'would quite possibly be exposed'. Mr Lowis says this house reflects a different type of design from the subject house notwithstanding its use of a breezeway, because the structure has dual access to bedrooms and areas with protection from the rain. Mr Lowis says that although there are some similarities there are differences as well. 113 As to No. 2 Lambus Street, Palm Cove , Mr Lowis says: 'The actual floor plan is quite similar [to the subject house] from what I can gather. The narrow veranda is 1.8 metres from what I can take from this plan on both sides of the bedrooms. That would be fairly similar to what the subject property is, however, ... the verandas are built in a way with the arches that it would have more protection from the elements. However, I would assume that they would still have issues with it ... There is detached living areas. The first bedroom I'd assume you wouldn't have too much difficulty with access via that veranda. ... The others would have quite similar access to the subject property although you wouldn't be walking upstairs. 2 Orana Street, Red Peak , Mr Lowis says the house reflects detached living areas with walkways relatively well protected from the elements. The plan comprises 5 separate pavilions and pavilions 1, 2 and 5 seemed to be detached bedrooms. 115 As to No. 67 James Cook Drive, Kewarra Beach , Mr Lowis says the layout shows that bedrooms and living areas have access to patios, however, all access to bedrooms is by means of an internal living area. Mr Lowis says such a layout is entirely different to the subject property. 116 As to No. 5 Lockwood Close, Whitfield , Mr Lowis was unable to easily construe the plan but suggested that the plan reflected a two storey property with internal stairs providing clear internal access. 117 As to No. 13 Brinsmead Road, Freshwater , Mr Lowis took the view that this plan was different to the subject house because overall its bedrooms and living areas have access to verandahs and access to the bedrooms is by means of a gallery which Mr Lowis assumes to be a breezeway which would be covered and protected. 118 As to No. 12 Gloucester Street, Whitfield , Mr Lowis says access again appears to be via a hallway which runs to the left hand side of the bedrooms. The bedrooms have access to verandahs. Although the bedrooms exhibit verandah access, there is also a hallway which runs along the left hand side of the bedrooms which provides internal access and avoids the elements. Accordingly, Mr Lowis says this design is different to the design of the subject property. 119 As to Nos. 5 --- 7 Peacock Street, Trinity Beach , Mr Lowis examined a photograph of the property. All that Mr Lowis can discern from the photograph is that the house exhibits a large patio area with a ceiling fan. No further comment is made. 120 As to No. 5 Hannah Close, Forest Gardens , Mr Lowis says the plans reveal a design for a house which utilises breezeways and open living areas. Access between the living areas and bedrooms is by means of a well covered and protected breezeway. That point of access is the only part of the dwelling which is exposed. All other access in either of the two detached living or bedroom areas is by internal access throughout. Access to a detached bedroom area includes a breezeway access but the access is well covered. Access to bedroom 2 is internal to the structure. So too is access to bedroom 1. Mr Lowis considers the plan for this house to be different to the subject house because of the covered access. 121 As to No. 77 Rainforest Road, Edmonton , Mr Lowis says that this design is different to the subject property. He says that from the lines on the plan it appears that most walkway areas are relatively well covered although some are not. Access to bedroom 1 on the plan appears to be by way of a covered walkway. The scale of the plan does not reveal the extent of the coverage. The roof line appears to be staggered. Bedrooms 2 and 3 appear to reflect a similar position. 122 In almost all cases, the point of differentiation between the house at 30 Latreille Terrace and the postulated examples of similarity is said to be either the internal and thus contained and enclosed access to bedrooms or in those cases of detached or split level structures where access to one or more bedrooms is by means of a patio, breezeway or verandah, that access feature is dimensionally greater than 1.8 - 2 metres and the extent of the roof coverage provides greater protection from the elements. Thus, the differentiating feature of access to bedrooms 2---5 by means of a covered but not enclosed verandah that is, in the relevant conditions, susceptible to rain and wind, is a design feature that, in Mr Lowis's opinion, 'should have been disclosed somewhere in the report. The bathrooms although an unusual feature, not as significant I guess as the access' . 123 The properties identified as numbers 4, 5 and 9 in Mr Harris's list at [106] had not been built as at 5 May 1999. He is not saying it is identical in terms of what you have identified as the deficiency in access in terms of 30 Latreille Terrace, would you agree with that? Access via open decks, verandas and breezeways are not uncommon as they allow for airflow and cross breezes". Would you agree with that opinion? Is that not the case? Access to bedrooms 2 --- 5 is 'fully covered and the verandahs and stairs are part of the overall design of the dwelling and are thus incorporated into its structure rather than being "added on"'. Further, Mr Duffield says '... the change in level between the living area and the bedroom area is only half a level and accordingly the stairs connecting those two arrears are relatively short'. In my opinion, the access to 4 of the properties 5 bedrooms via the veranda was not unusual having regard to the design of other residential properties in the Cairns region making it unnecessary to specifically state [in the Pro-forma Report] that this type of access was "unusual"'. In that respect, the design is different to Latreille Terrace but that difference is, in my Duffield's view, 'not necessarily a substantially important difference'. Mr Duffield says that although not a similar design as the subject house, 'it's in a similar market segment'. (b) As to 23 Darkin Close, Smithfield, the property has a large swimming pool, waterfall, 6 bedrooms, is highset and some of the bedrooms are separate from the living room although not in a separate wing. There is no access by a verandah. (d) In terms of access to bedrooms, properties (a), (b) and (c) are all 'relatively standard' with 'nothing particularly different from most houses in Cairns'. It's a feature that is very rare in Cairns, in your experience? I'm putting to you that a house designed in the manner I've described is a very different --- of a very different design to the Latreille Terrace house? If it's not a conventional design does that not mean in your opinion that it's an unusual design? I valued houses that I considered unusual that are, you know, built like a rocket ship or a fibreglass dome. That's what I would consider unusual. Price will affect the size of the market, among other factors. Mr Duffield says that if the limitation in the size of the market as a consequence of the design feature has an adverse effect to the extent of adversely affecting the marketability of the property, the mortgage insurer would, in Mr Duffield's view, expect 'to want to know about it'. 130 However, Mr Duffield does not accept that the design feature of external access to 4 of the 5 bedrooms via a verandah effects the ease with which such a house might be sold although he concedes 'it may do' but says that it is 'not likely to do so'. Even though there may be fewer buyers seeking such a house, Mr Duffield says it is 'not necessarily' harder to sell such a house. 134 Mr Harris is a director of KF Cairns Pty Ltd trading as Knight Frank Cairns. At or about 10 March 1999, KF Cairns Pty Ltd was known as MGW Pty Ltd trading as Knight Frank NQ. Mr Harris completed an Associate Diploma in Real Estate Valuation in 1991 and became a registered urban valuer in 1992. Mr Harris completed a Bachelor of Applied Science (Property Economics) at the Queensland University of Technology in 1994. Mr Harris has been based in Cairns since March 1995. Mr Harris says that he has considered the opinion expressed by Mr Lowis in his statement dated 23 March 2005 and disagrees with it. In my opinion, the access to 4 of the property' s 5 bedrooms via the veranda was not unusual having regard to the design of other residential properties in the Cairns region. Further, in my opinion, it was not necessary for the valuer who completed the valuation for mortgage security purposes on 4 May 1999 to specifically state in his report that this type of access was "unusual". Annexed to this affidavit and marked "CH6" is a schedule of residential properties (including floor plans) in the Cairns region which have similar or broadly equivalent designs in terms of access to bedrooms and which fall roughly within the same sector of the residential property market as the property. It is my opinion that property in the $350,000 to $750,000 price range in the Cairns region will often include differentiating features. Access via open decks, verandas and breezeways are not uncommon as they allow for airflow and cross breezes. Mr Harris annexes to his affidavit a copy of a valuation dated 8 March 2001 arising out of that inspection. On a date prior to 10 March 1999, Matthew Pullos, a valuer at Knight Frank NQ was instructed to prepare a valuation for CR & BJ Cats for mortgage security purposes of their property at 30 Latreille Terrace, Brinsmead Glen ("the Property"). I signed a copy of this valuation in my capacity as a director of MGW Pty Ltd trading as Knight Frank NQ. Annexed to this affidavit and marked "CH2" is a copy of the valuation dated 10 March 1999. The valuation is signed by Mr Pullos as a registered valuer and by Mr Harris as a director of Knight Frank NQ. At paragraph 1.3 of the valuation, the author says: 'This valuation represents our opinion of value at the date of valuation. It must be recognised that the real estate market fluctuates with internal and external influences and should be reviewed at regular intervals. The opinion of value expressed in this report has been arrived at by the prime signatory acting as a valuer in accordance with instructions given' . The author of the report in Section 2 sets out the details of property searches, description, tenure, easements, land area, dimensions and the existing zoning. In Section 2 , the author identifies site details which at Section 3.5 include a physical description of the property in these terms: 'The subject property is slightly irregular in shape, above road level with a moderate to steep slope to the rear boundary. The allotment is elevated with extensive views to the west across the Brinsmead Valley'. In Section 4 , the author describes the 'improvement' details and describes the building layout in these terms: 'Erected on the property is an extensive hardi-flex and granosite dwelling approximately one year old with a steel frame and substantial masonry block piers to the front. The building comprises five bedrooms, ensuite, four bathrooms, games room, movie room, lounge, kitchen/dining room, study and a triple garage/laundry beneath the sleeping quarters. Extensive verandahs provide outdoor living and entertainment areas'. Section 4 also contains a description of the fittings and fixtures. This market is more active for established residences in the area of Edge Hill and Whitfield. However, Latreille Terrace and Hearle Close have developed into "exclusive addresses" given the location and available views. Consequently, we believe that should the property be put to market an extended marketing period of 12 to 18 months would be expected to achieve a fair sale price. 138 On 8 March 2001, Mr Harris prepared a valuation of the subject property on behalf of the owners, CR & DJ Cats. The valuation also contains a statement that the expression of value in the report has been arrived at by the prime signatory. At Section 4.1, the building layout is described in these terms: 'The subject property is improved with a highset dwelling comprising five bedrooms, five bathrooms, open plan dining/kitchen area, separate lounge, study, ensuite, five bay garage, laundry and games room. There are large scalloped verandahs along the front of the dwelling on two levels, a rear balcony and a rear verandah overlooking the parking garage area. Other improvements include a steep exposed aggregate driveway and rendered block retaining walls' . The market value is assessed on a selling period for this type of property which would expect to be longer than normal and it is assumed that the vendor will not be forced into selling the property over a short period of time due to financial or other pressures. Under normal circumstances, the most suitable method of assessing the value of this type of property is by means of the direct Comparison Approach which compares the property directly to recent sales of similar properties within the general locality. Although this method has relevance in the valuation of prestige residences such as the subject, the assessment of market value is determined to a large extent by the timing of any sale, the length of any selling period and a small number of prospective purchasers. To achieve a successful sale of prestige residences, an "element of luck" is often necessary to locate a specific buyer at the time of marketing who can afford to pay in this price range. Sales often occur on emotion, where price is not a wholly determining factor. Therefore, the vendors keen to sell have needed to be realistic in order to meet the market and values on an overall basis have generally moved downwards. We would consider the subject property due to the extensive nature of improvements to figure prominently in the executive residential market. In consideration of the sales, the subject property while being a large dwelling has limited useable land area and is situated in Brinsmead, a suburb more known for first and second home buyers. We have assessed a current market value for the subject property of $475,000. 142 However, the Applicant seeks to rely upon these reports as evidence in its case on the basis that the reports represent material put in evidence by the Respondents which contain admissions against interest in these respects. First, as to the report dated 10 March 1999 approximately two months prior to Mr Duffield's valuation on 5 May 1999, Mr Pullos expressed an opinion as a qualified and professional valuer that should the property be put to the market for sale, an extended marketing period of between 12 and 18 months would be expected, to achieve a fair sale price. Thus, the Respondents are said to have admitted that such a period of marketing would be necessary, in effect, in May 1999 and a valuer conducting a valuation on 5 May 1999 ought to have made reference to the extended marketing period. Secondly, the report dated 8 March 2001 recognises that in order to achieve a sale of the subject residence, 'an "element of luck" to locate a specific buyer is often necessary'. Similarly, the Applicant contends that the Respondents have made an admission against interest by introducing the report into evidence thus recognising that an element of luck would be required in securing a sale of the subject property and no reference is made by Mr Duffield in his report to any 'element of luck' in securing a sale. 143 It seems to me that there are real difficulties with these propositions. 144 The report dated 8 March 2001 is a valuation prepared one year and 10 months after the valuation prepared by Mr Duffield on 5 May 1999. It seems to me that the observations concerning 'an element of luck' in relation to prestige residences is an expression of opinion which contextualises the conjunction or circumstances, market conditions and trends within the Cairns market for prestige properties at the moment in time when the report was prepared. To the extent that the Respondents have sought to rely upon the document, it contains an expression of opinion, apparently embraced by Mr Harris by annexing the report to his affidavit, that in order to achieve a sale at the valuation price as determined on 8 March 2001, a number of factors would need to be considered carefully including timing of the sale, the length of the selling period, overall movements in the price for prestige properties within the Cairns market as reflected in any evident trend and an element of luck in attracting a buyer with a disposition to acquire the particular property at the nominated price drawn to the catchment for prestige properties by reason of a particular marketing campaign adopted by the vendor. 145 In relation to the valuation report dated 10 March 1999 undertaken by Mr Pullos and signed by Mr Harris, it seems to me that the observations concerning the need for an extended marketing period of 12 to 18 months have a necessary inter-dependence with the price or value determined by the valuer. Mr Pullos says, in effect, that the appropriate point of intersection between a willing but not anxious vendor and a willing but not anxious buyer acting prudently is $520,000 which is $45,000 more than the value Mr Duffield ascribed to the property eight weeks later. The opinion Mr Pullos puts is that because Latreille Terrace had developed into an exclusive address having regard to its location and available views (outlook), an extended marketing period of 12 to 18 months would be expected by Mr Pullos to achieve a fair sale price should the property be put to the market. I infer that Mr Pullos means by the phrase 'put to the market', a notion of put to the market at the price he has determined as the value of the property. The term 'fair sale price' might contain within it some degree of ambiguity but presumably when Mr Pullos speaks of a 'fair sale price' he means a sale price which reflects his view of fair value, namely, $520,000 or perhaps a price which represents a slight concessional discount from that value but which is a sufficiently small discount such that the vendor achieves a price which approximates very closely the true and fair value Mr Pullos had determined. 146 Mr Pullos was not called to give evidence concerning his report. The report is put in evidence by Mr Harris. 147 It seems to me that the statements in the valuations cannot be admissions by the Respondents that the subject property valued at $475,000 on 5 May 1999 would have required an extended marketing period of 12 to 18 months to achieve that value or that at 5 May 1999 an element of luck would be required to find a buyer for the subject property at $475,000. 148 Mr Harris was cross-examined as to these matters and in many respects Mr Harris's evidence is unsatisfactory. Ultimately, Mr Harris's frank and direct answers to propositions put to him by counsel for the Applicant suggest to me that he answered the questions put to him in a way which reflected genuinely held views on his part. The evidence, however, is unsatisfactory in these respects. Mr Harris was called as an independent expert in order to assist the court in reaching a conclusion on the questions in issue by exercising the privilege of expressing an 'opinion' on matters within his expertise. In relation to the report dated 10 March 1999, annexed to Mr Harris's own affidavit, Mr Harris gave evidence-in-chief that he considered the comment that an extended marketing period of 12 to 18 months would be expected to achieve a fair sale price, was a comment that he now considered to be incorrect. Mr Harris accepted, in cross-examination, that his evidence now was that 'a value of that property was --- the figure stated there [$520,000] --- based upon an inappropriate sales period' . 149 Mr Harris was asked these questions. [Mr Harris may have said 'wouldn't' in answer to this question. In making these observations, I am conscious of the comments of Allsop J in Evans Deacon Pty Ltd v Sebel Furniture Pty Ltd [2003] FCA 171 at [676] , the remarks of Gleeson CJ in H G v The Queen [1999] HCA 2 ; (1999) 197 CLR 414 at [39] to [43] and the observations of the Australian Competition Tribunal per Goldberg J (President), Mr Latta and Professor Round in Qantas Airways Limited [2004] ACompT 9 at [212] to [227]. The observations of the Australian Competition Tribunal on the use of expert evidence and particularly the role of the expert ought usefully be provided to any expert seeking to give evidence in court proceedings. 151 As to the relationship between the nominated value of $520,000 and the sales period [148], Mr Harris said in evidence-in-chief that: '... if the property had been discounted or at a lower level, a selling period of a shorter period would have been more appropriate'. Considering a valuation, say, of in the range 470, 475, you know, I would think that would be an appropriate selling period, of the three to four months as specified in the memorandum'. In 1999, I was doing residential valuation full-time, and I was inspecting various properties. I have not inspected, for the purposes of this valuation, these six valuation sales but I'm aware of a number of these properties in relation to other work that I undertook at that point in time. Of this particular property? There is no hypothecation of an opinion with testing of that hypothesis by reference to relevant data and verification of the hypothesis leading to an objectively robust conclusion. The opinion is simply speculation. 154 Accordingly, having regard to all of these matters, the opinions expressed by Mr Harris on the matters in issue, properly the subject of expert evidence, must be treated with considerable caution. 155 As to the later valuation of 8 March 2001, Mr Harris said a longer than normal marketing period of up to six months may have been required to achieve a sale at $475,000 because 'the market, at that time, had slowed sufficiently where the rate of sale in the Cairns market was requiring a longer [period] than what would be ordinarily accepted out of the supporting memorandum. That three to four months is not written to be the absolute sale period' . 156 As a matter of generality, Mr Harris accepted that in the period 1999 to 2001 properties in the higher market ranges would require a longer selling period than properties in lower price ranges and, generally, a longer period than three to four months. Further, if the valuer formed a view that a particular property would take more than three to four months to sell, that view should be stated in an API Pro-forma report. Mr Harris accepted that if the house being sold was, in his view, a prestige property, he would say that in the valuation and he would expect a valuer to do so. Mr Harris accepted that as a general proposition, properties classified as prestige residences required an element of luck and a longer sales period to achieve a price within the prestige property price range. 157 As to the specific house at 30 Latreille Terrace, Mr Harris was tested as to his opinion that 'four of the five bedrooms could only be accessed by external verandahs and stairs was not unusual in the context of the design of the house' and was asked to explain the reference to 'in the context of the design of the house'. It was such that it provided for a split-level two - the main body of the resident was a two-storey residence with the bedroom being attached to that part of the --- bedrooms two to five being attached to that with interconnecting walkways and covered verandahs and I, in my professional opinion, have no problem with the design of that property, for the typography in which it sat and the location, in where it was in Latreille Terrace. The proposition was put to him that the house at 30 Latreille Terrace reflected differences in design of substance from the identified similar houses on the basis that the only access to four of the five bedrooms in the subject house is via an external verandah approximately two metres wide. Mr Harris accepted that the design feature represented a design difference but the question of whether it was a difference of substance was a matter of opinion . Mr Harris also accepted, in general terms, that a house with such a design feature would be less secure than one where access to the bedrooms was by way of internal access from within the structure. Mr Harris observed that the subject bedrooms contained security screens and grills. 159 Mr Harris accepted that most houses in Cairns are designed with internal access to bedrooms even if there is also external access. Mr Harris did not accept that it would be harder to sell a prestige house with only external access to four of the five bedrooms than to sell a prestige house with internal access to all the bedrooms. Further, Mr Harris did not accept that a mortgagee or mortgage insurer reading Mr Duffield's valuation of 5 May 1999 would reasonably read it as descriptive of a house that was a 'dwelling of average quality'. Mr Harris said he reached that conclusion 'because it has five bedrooms and five bathrooms and it is 395 square metres of living area'. Mr Harris contended that, '... if you were reading the valuation under "main building" and read that it had five bedrooms and five bathrooms, I think if you knew that in that area the general house was a three or four bedroom house, then you would ask the question'. 160 Mr Harris was tested in relation to the comments in his affidavit sworn on 3 November 2005 in response to the opinion of Mr Lowis and particularly Mr Lowis's opinion that as at May 1999 the subject property 'may remain on the market longer in the sense of more time than would be normal'. Mr Harris accepted that he had read the affidavit of Mr Lowis carefully and had not expressed any disagreement in his affidavit with that part of the opinion of Mr Lowis. Mr Harris described Mr Lowis's comment as 'generic' and accepted, when put to him, that he agreed with it. 161 Mr Zrilic says in a supplementary affidavit sworn 29 November 2005 that had the valuation by Mr Duffield recorded that an element of luck was necessary to achieve a sale of the property because it was a prestige property, he would have marked the R D Input sheet 'Adverse' and rejected the L M Insurance proposal. 163 Mr Duffield and Mr Harris contend that neither feature is unusual. 164 As to the second feature of a shared bathroom between bedrooms one and two and a shared bathroom between bedrooms three and four, Mr Lowis did not disclose the feature in his model report, described the feature as 'not as significant, I guess as the access' and identified the point of real differentiation as the access to the bedrooms by an open-air verandah. 165 I accept the evidence of Mr Duffield that such a feature is not unusual and I find that there was no duty to disclose that feature. 166 As to the access feature, the Supporting Memorandum contemplates a 'brief report' to facilitate an 'expedited cost effective report' to advise a mortgage insurer of 'sufficient and appropriate' information of property specific and market related risks ([74], 1:1.5, 1:2.3). Inherent or external features that have a 'significant impact' on the property should be adequately noted ([74], 1:3.2). Where such an impact arises, the 'Additional Comments' section of the report might be utilised to so note the feature ([74], 1:3.3). The Property Summary directs the reader to 'marketability' which takes up the notion of an overall initial assessment of how inherent and external features of the property might impact upon 'market appeal' or make the property harder to sell ([74], Item 1, Marketability). The numerical and graphic risk assessment is designed to provide a 'bold, clear caution indicator' of the presence of 'relevant comments in the Additional Comments' section ([74], Item 2, Risk Analysis). Moreover, any other specific risks identified by the valuer which do not 'come under these aspects should also be commented upon in Additional Comments' ([74], Risk Ratings). Should a valuer consider that a particular feature exhibits a risk to the insurer of 4 or 5 the valuer must explain the perceived level of adverse impact the particular aspect or feature could have on either 'value' or 'marketability' within the initial 2---3 years of the security/insurance ([74], level of adverse impact or risk). The Supporting Memorandum recognises that the 'extent' of the adverse impact 'may vary significantly' and the rating therefore requires a 'balanced overview for that aspect' ([74], extent/adverse/favourable impacts). Some aspects of improvements may affect the risk assumed by the mortgagee or insurer because they may give rise to 'make good obligations' or increase the risk by 'reducing' the marketability and 'increasing' the selling period ([74], Improvements). The Supporting Memorandum reflects the relationship between the 'value', ie. a 'single figure amount' and the typical or orthodox marketing period for the class property. If more than three or four months is likely, that fact should be noted, an estimate of the likely period made and a comment incorporated in the report on the 'dynamics of the market' in the Additional Comments section ([74], 3, Valuation & Assessments Summary). 167 Having regard to that framework, Mr Lowis described the marketability of the property as 'fair', considered the risk derived from the access feature, as a function of improvements, to be 'low', chose not to elevate the rating beyond 1 in a way which would provide a 'bold, clear, caution indicator' to the reader of the presence of relevant comments in the 'Additional Comments' section directing the mind of the reader to the risk implications of the access feature, elected not to describe the feature in the Additional Comments section as unusual or an unusual design feature and elected not to provide any explanation of the feature as any 'other significant risk'. In evidence [99], Mr Lowis accepted that a rating of 1 concerning the improvements was not inappropriate, that the risk associated with the nominated features was no greater than a medium risk and that had any feature of the improvements struck him as a feature of importance he thought ought to have been drawn to the attention of the insurer at the relevant time, it was incumbent upon him to draw attention to that matter in the 'Additional Comments' section of his model report and he had not done so. Mr Lowis accepted that, in consequence, his election not to draw attention to the feature in the Additional Comments section of the model report meant, in his assessment of the property, that there was no real risk, to an insurer, in respect of the property. 168 It seems to me that whatever the true character of the access feature criticised by Mr Lowis may be, the evidence of Mr Lowis ultimately is that the feature was not sufficiently significant that it warranted the adoption of a bold, clear caution indicator, the adoption of an elevated risk rating or a clear warning or commentary in the Additional Comments section of the model report. In fact, the access feature presented no real risk to the insurer. Although Mr Lowis expressed the view in his statement that 'a competent valuer completing the report should at the very least make reference to any unusual design or layout features under the "Additional Comments" heading, or in the alternative, under the Interior Layout heading', the reference to access to bedrooms 2-5 via an open air verandah was not perceived by Mr Lowis, for the purposes of the model report, to give rise to anything other than the lowest level of "improvements" risk or represent a feature of sufficient prominence that it represented a pronounced risk to the insurer for the purposes of the Risk Analysis section of the model report. Although I generally accept the evidence of Mr Lowis and accept that as an expert witness Mr Lowis was conscientiously seeking to assist the Court on the range of matters in issue falling within the scope of Mr Lowis's expert opinion, I am not satisfied having regard to the framework of the Supporting Memorandum and the evidence of Mr Lowis that the Applicant has established that the Respondents owed a duty to the Applicant to incorporate within the Pro-forma Report a description of the access feature criticised by Mr Lowis in the words suggested by Mr Lowis, namely, 'access to bedrooms 2-5 is via an open air verandah' or at all. 169 As to the question of whether the access feature is 'unusual' or 'an unusual design feature', I accept the evidence of Mr Duffield that such a feature is not unusual. Although I have expressed caution and reservation concerning reliance upon the opinions expressed by Mr Harris, Mr Lowis agreed with the opinion expressed by Mr Harris that property in the price range $350,000 to $750,000 in Cairns will often include differentiating features and that access via open decks, verandahs and breezeways are not uncommon as they allow for airflow and cross breezes. Mr Lowis also accepted that in tropical North Queensland, the access design feature criticised as unusual by Mr Lowis is one which some persons in the luxury house market would seek out. Although it is true that the examples of similarly designed houses identified by Mr Duffield and Mr Harris do not reflect features which are identical with the access feature criticised by Mr Lowis, I accept that in the luxury or prestige market segment in Cairns there are examples of structures which incorporate verandah, patio or breezeway access to bedrooms as a feature of design although distinguished by the specific architectural expression of the feature. 170 The Applicant contends that the breach of duty on the part of the Respondents was not that they failed to describe the access feature as unusual or a feature reflecting unusual design but that they simply failed to describe the feature thus preventing the Applicant from forming its own view as to whether the feature was 'unusual' for the purposes of the application of the Policy Manual [29]. There seems to me to be circularity in this formulation of the breach of duty. The duty owed by the valuer in preparing the valuation, conditioned by the Supporting Memorandum, was to describe those features which adequately informed the Applicant as to the relevant risks, derived from those features, rated according to the directions and guidance given by the Supporting Memorandum. The feature did not attract a risk rating of 2, 3, 4 or 5 as a function of improvements, from Mr Lowis. It was accorded a rating of 1 by Mr Lowis, the lowest risk rating. In other words, Mr Duffield was not likely to describe the access feature in the Pro-forma Report unless the feature was unusual and, if unusual, the valuer would be expected to describe the access feature as unusual. However, Mr Lowis in formulating the model report chose not to describe the feature as unusual nor elevate the risk rating in respect of the feature or address remarks as to the unusual nature of the feature in his 'Additional Comments'. 171 I find, as indicated in these reasons, that the feature is not unusual. Although I have expressed reservation in placing reliance upon the evidence of Mr Harris, I accept his opinion as corroboration of Mr Duffield's opinion that the feature is not unusual. 172 Accordingly, I find that there was no duty on the part of the Respondents to describe the access feature. The evidence does not establish that the feature is unusual or represents an unusual configuration of the improvements to the property or represents an unusual design of improvements to the property. 173 I also find that there was no duty on the part of the Respondents to comment upon the improvements identified by Mr Lowis on the contended footing that the improvements were not consistent with the property being used as a residence. Mr Duffield conducted a valuation of the property on the footing that the property was an integrated structure used as a residential dwelling. At the date of the valuation, Cornitus and Bethwyn Cats were using the house as a residential dwelling. The Pro-forma Report makes it plain on its face that the document was prepared on that basis. 174 Accordingly, I am not satisfied that the Applicant has established that the Respondents, in undertaking the valuation, breached any duties owed to the Applicant arising out of a failure to describe the access feature or in assigning a low risk rating to the improvements to the property. 175 The Applicant also contends that the Respondents, in breach of a duty to exercise all reasonable care, skill and diligence as a competent valuer in preparing the valuation and in breach of a duty to record any deficiencies in the property that may detrimentally affect the property's marketability, failed to state that a marketing period of up to 12 to 18 months was likely to be necessary in order to achieve a sale of the subject property at or about the valuation of $475,000. 176 Mr Lowis has given no evidence to that effect. 177 Mr Lowis says that, in his opinion, the access feature is likely to limit the market of potential buyers, discourage some purchasers and thus the property 'may remain on the market longer'. In his statement dated 23 March 2005, Mr Lowis says that he is not able to express an opinion as to how long the property may need to remain on the market before a sale might be effected. Mr Lowis in his 'Additional Comments' in the model report, did not draw attention to any aspect of the property that suggested to him that a period of more than three to four months would be required to achieve the market value. Although Mr Lowis was not asked to and did not insert a 'single figure amount' in his model report and thus ascribe a market value to the property, the immediate question is (accepting Mr Duffield's value of $475,000 which is not under challenge), whether prudent practice required Mr Duffield to draw attention to the access feature as one which might detrimentally affect the marketability of the property. The 'particular' contention is that a very extensive period of 12 to 18 months would be required in order to achieve a sale at or about Mr Duffield's single figure value. 178 Mr Lowis, in addressing the approach to the term 'marketability' in Section 1 of his model report, suggested that he ought not to have referred to the term 'fair' in the context of marketability because he was unaware of and had not studied the marketability of the property at the time of preparing the model report. Mr Lowis was asked by counsel for the respondents to focus on the notion that marketability in Section 1 was directed to a design feature which might affect marketability rather than saleability or comparative sales and, in effect, buyer substitution possibilities. Nevertheless, it seems to me difficult for Mr Lowis to express an opinion concerning whether the property might remain on the market longer than the period suggested by the Supporting Memorandum by reason of the access feature, in the absence of a careful analysis of market circumstances at the time. Whilst it is true that Mr Duffield accepts that there would be a smaller number of people in the market for prestige houses in Cairns in 1999 who would prefer a house exhibiting the particular access feature and that the market for such a house is a smaller market than would be available for a house exhibiting internal access to all the bedrooms, Mr Duffield does not accept that the feature will affect the ease of sale of such a house although he accepts 'it may do' but 'is not likely to do so' and says that it is 'not necessarily' harder to sell such a house. 179 On the question of the marketability of the property and whether the property might have taken a longer period than the typical marketing period suggested by the Supporting Memorandum, I accept the evidence of Mr Duffield. 180 I find that the contention that a marketing period of 12 to 18 months was likely to be necessary in order to achieve a sale of the subject property at or about the valuation recorded by Mr Duffield on 5 May 1999, is not made out. The question of whether in May 1999 a marketing period of greater than the typical marketing period of three to four months suggested by the Supporting Memorandum might be required in respect of the subject property, was a question to be determined as a matter of professional opinion about which legitimate differences of opinion might arise. I have found that there was no duty cast upon the Respondents to describe the access feature in the Pro-forma Report and nor was the feature unusual. To the extent that the failure to describe in the Pro-forma Report any aspect of a contended difficulty in the marketability of the property is said to derive from a failure to describe an unusual feature, an unusual configuration of the improvements or a deficiency of design, the contention is not made out. 181 For the reasons indicated at [143], [144] and [145], the statements relied upon by the Applicant contained in the valuations, although not authored by but signed organisationally by Mr Harris, are not admissions of the material fact in issue. I am not satisfied that the Applicant has established the breach pleaded at par 13(h) of the Further Amended Statement of Claim. 182 Having regard to these findings, the conduct of Mr Duffield as agent on behalf of the First Respondent did not result in conduct which was misleading or deceptive or likely to mislead or deceive the Applicant in contravention of s 52 of the Act nor conduct which constituted a false or misleading representation concerning the nature of an interest in land or the characteristics of the land in contravention of s 53A. 183 In determining whether the conduct of the Respondents in formulating the Pro-forma Report involved conduct in contravention of ss 52 or 53A, it is important to remember that in assessing and reading the valuation by Mr Duffield, Mr Tome Zrilic was a skilled addressee as was Mr Steven Ramage [46] although Mr Ramage did not read the report. I find that the Pro-forma Report read by Tome Zrilic conveyed sufficient information together with a photograph of the property to make it plain that the property was a luxury house or at least one exhibiting sufficient features of distinction that it must have been apparent to Mr Zrilic that the improvements to the property were substantial and very likely to place the property in the band of houses falling within the luxury market segment in Cairns. No enquiry was made of Mr Duffield by Mr Zrilic concerning any aspect of the report. Mr Ramage conceded in evidence that a property exhibiting five bathrooms, five shower recesses, five toilets, air conditioning and a home theatre room would be 'probably different' from a usual house and although 'unusual', 'not unusual to a great extent'. In explaining the phrase 'not unusual to a great extent', Mr Ramage said that such features 'wouldn't be the norm'. It seems to me that that evidence is consistent with a recognition that an informed reader, reading the Pro-forma Report of Mr Duffield thoroughly and critically, consistent with the requirements of the Policy Manual [31], was not likely to be misled as to the extent or character of the improvements to the property. As to the question of whether the property would require the extended marketing period contended, I have accepted the evidence of Mr Duffield and have found that the Applicant's contention is not made out. In any event, the question of whether the subject property might have required an extended marketing period is properly a matter of opinion and I accept that Mr Duffield had a reasonable basis for the opinion. 184 Although I have found that the Applicant's case is not made out, I find that the damages suffered by the Applicant are those identified at [5]. 185 Accordingly, I propose to dismiss the application. 186 The Respondents contend that in the event that they engaged in a breach of duty owed to the Applicant, the amount of the Applicant's claim ought to be reduced by the extent to which the Applicant contributed to the loss. The Applicant claims the amount identified at [5] from the First Respondent as damages for negligence or, alternatively, as compensation pursuant to s 87 of the Act. Since the formulation of the amount of the compensation claim for the purposes of s 87 is the same formulation of loss for the purposes of an amended claim pursuant to s 82 of the Act and involves the same factual forensic analysis, I propose to give leave to the Applicant to amend the Application and Further Amended Statement of Claim to introduce a claim for damages pursuant to s 82. A claim for damages pursuant to s 82(1) arising out of a contravention of s 52, is susceptible of reduction pursuant to s 82(1B) in circumstances where the applicant suffered the loss or damage as a result partly of the applicant's failure to take reasonable care in the circumstances contemplated by s 82(1B)(b)(ii) and (c). However, that susceptibility only arises in respect of a cause of action in the applicant arising after 26 July 2004 ( I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd [2002] HCA 41 ; (2002) 210 CLR 109 per Gleeson CJ, Gaudron, McHugh, Gummow and Callinan JJ; CLERP Economic Reform Program (Audit Reform and Corporate Disclosure ) Act 2004, Act No. 103 of 2004, s 3 & sch. 3 [5]; Government Gazette GN28, 14.7.04, p2157; sch. 12). In this case, the Applicant's cause of action arose no later than 13 September 2002 when the Applicant paid the claim made by the mortgagee. Section 82(1B) has no application to a claim for compensation pursuant to s 87 nor to a claim for damages pursuant to s 82(1) arising out of a contravention of s 53A. Accordingly, had a contravention of ss 52 or 53A of the Act been found, such a claim would not be susceptible of reduction under s 82(1B). A separate question might arise as to whether the exercise of the power conferred upon the Court by s 87 carries with it, in terms, a power to reduce the amount of the compensation having regard to the conduct of the applicant. The power conferred is one to order compensation in circumstances where the Court considers that the relevant order will compensate an applicant in whole or in part for the loss or damage or will prevent or reduce the loss or damage. First, since I have found that the Respondents did not owe a duty to the Applicant to describe the two controversial features, did not breach a duty owed to the Applicant and did not engage in conduct in contravention of the Act, it is not necessary to further consider the question of whether the Applicant contributed to a loss arising out of a 'wrong' on the part of Respondents. Secondly, had a contravention of the Act been found, the question would not be alive for the purposes of s 82 of the Act in any event. Had a breach of duty owed to the Applicant been found and no contravention of the Act, the question would then be alive. No such finding has been made. I certify that the preceding one hundred and eighty eight (188) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood. | insurance action for damages pursuant to s 82 of the trade practices act 1974 (cth) and compensation pursuant to s 87 arising out of a contended failure on the part of the respondents to disclose in a valuation relied upon by a mortgage insurer, features of the improvements to a property said to constitute unusual features, an unusual design or an unusual configuration of the improvements consideration of the australian property institute (api) residential valuation and security assessment pro-forma valuation instrument and supporting memorandum consideration of a claim for negligence by the applicant mortgage insurer against the valuer. trade practices |
If the Court is so satisfied, then pursuant to s 201, the Court must fix a time and place for conducting the inquiry and may give such directions as it considers necessary to ensure that all persons who are, or may be justly entitled to appear at the inquiry are notified of the time and place fixed and, where the Court fixes a time and place, the inquiry is taken to have been instituted. Schedule 1 and Items 1-3 of Sch 22 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (Transitional Act) commenced on 1 July 2009 after the application was made and the hearing of it conducted. Those provisions repealed the WR Act, save for Sch 1 and Sch 10 thereof, renamed the WR Act the Fair Work (Registered Organisations) Act 2009 (Cth) (FWRO Act) and made various other amendments (for example, substituting the title "General Manager" for "Industrial Registrar"). The Workplace Relations (Registration and Accountability of Organisations) Amendment Regulations 2009 (No 1) (Cth) which commenced on 1 July 2009 amended the Workplace Relations (Registration and Accountability of Organisations) Regulations 2003 (Cth) by inter alia renaming them the Fair Work (Registered Organisations) Regulations 2009 (Cth) (FWRO Regulations) . Item 11(1) of Sch 2 of the Transitional Act (which also commenced on 1 July 2009) continues the effect of the WR Act after 1 July 2009 in relation to certain conduct that occurred before that date. However, reg 5.11(2) of the Fair Work (Transitional Provisions and Consequential Amendments) Regulations 2009 (Cth) (Transitional Regulations) provides that Item 11 of Sch 2 to the Transitional Act does not apply to the WR Act provisions that are not repealed by Sch 1 of the Transitional Act. According to [85] of the Explanatory Memorandum that accompanied the Transitional Regulations, the effect of reg 5.11 is to clarify that, from 1 July 2009, conduct relating to Sch 1 or Sch 10 of the WR Act that occurred before 1 July 2009 will be dealt with under the FWRO Act. The effect of these provisions is that all of the relevant sections of the former Sch 1 of the WR Act which governed the present application are now to be found (with inconsequential amendments such as the renaming of the office of "Industrial Registrar" to that of "General Manager") in the cognate provisions of the FWRO Act. See Tracey J in Re; Health Services Union [2009] FCA 829 (4 August 2009) at [9]. Schedule 17 of the Transitional Act also amended the Federal Court of Australia Act 1976 (Cth) by creating the Fair Work Division of the Federal Court. See s 13 and s 15 of the Federal Court of Australia Act 1976 . Item 46 of Sch 22 of the Transitional Act invests the Fair Work Division of the Federal Court with jurisdiction to deal with applications made under the FWRO Act. The present application therefore falls to be determined by me sitting in the Fair Work Division of the Federal Court pursuant to the cognate provisions of the FWRO Act. While an application under the WR Act was initially lodged on 13 October 2008, on 23 February 2009 the applicant filed a "substituted application", which is hereafter referred to as "the application", for an election inquiry in which the irregularities identified were said to arise as a result of the contravention of s 190 of Sch 1 of the WR Act. Section 190 provides that an organisation or branch commits an offence if it "uses, or allows to be used, its property or resources to help a candidate against another candidate in an election under this Part for an office or other position". The question is whether the Court is satisfied in terms of s 201(b). It will not be so satisfied that if the grounds relied upon could not, even if made out, constitute 'an irregularity in relation to an election for an office in the organisation'. The question whether there is such an irregularity lies at the heart of this jurisdiction. Nor will it be so satisfied if the allegations of fact relied upon in the application do not at least offer good grounds for suspicion that there has been such an irregularity. The Court will not entertain an application of a speculative nature based upon the applicant's opinion that there has been irregularity unless that opinion rests upon some substantial factual foundation. The applicant says that s 190 was introduced to remedy the defects in the previous law considered to be revealed by Re Collins; Ex parte Hockings [1989] HCA 42 ; (1989) 167 CLR 522 ( Re Collins ) where the High Court held that a breach of the rules of the union relating to activities involved in electioneering was not an irregularity as defined in the legislation. I accept s 190 followed this recommendation. The applicant recognises that s 190 only proscribes the use of property and resources "to help a candidate against another candidate in an election under this Part". The applicant contends that, for the purposes of the expression "in an election", the election process goes back to a date earlier than the opening of nominations and includes any step taken earlier in the election process, including the advertisement of the forthcoming date for opening nominations. The applicant also contends that the term "candidate" in s 190 should be construed to include people who have indicated prior to nominations their interest in standing for an office. And that is borne out by other phrases frequently used, as for instance, in secs. 20, 29, 30 and 32, in which we find such expressions as 'conclusion of an election. ' 'conclusion of an annual election,' 'conclusion of such election,' by which it is manifest that the legislature meant the final step, the taking of the poll, or declaration of election where no poll was taken, the conclusion of a combined process. Thus, the applicant contends that the meaning of the phrase "in an election" in s 190 will be determined by the context in which it appears in the legislation. The applicant says the provision was introduced by the Parliament with the clear purpose of making it an offence for a union to allow an incumbent to obtain an unfair electioneering advantage over opposing candidates by the use of union property and resources, and that it would "make a mockery" of the legislation if the union allowed an incumbent to use its property or resources to gain what could be an overwhelming electioneering advantage right up to the date of opening nominations or until the time a particular person nominated for an office. The applicant says a restricted interpretation of s 190 would nullify the intent and purpose of the provision and that the better view is that an election starts when the candidates declare their candidacy in a practical sense and commence electioneering. The applicant says that, in the case of Mr Reynolds, this occurred from at least 23 June 2008. It is from this time the resources of the union must not be used to advance one candidate against another. The applicant also contends that in determining whether the allegations of fact relied upon in the application offer the grounds for suspicion that there has been an irregularity, the Court is entitled to have regard to the judgment of Heenan J in CFMEU v Kavanagh [2008] WASC 146 ; (2008) 175 IR 225 ( CFMEU v Kavanagh ) and to his Honour's description of and conclusions from the material in front of him, in particular that: Based on this information and these observations, the applicant contends that the conduct of the CFMEU to allow Mr Reynolds as the incumbent in control of the CFMEU to use the property and resources of the CFMEU to promote Mr Reynolds' candidacy and to attack opposing candidates is a clear breach of s 190. The applicant says, alternatively, that even if the Court should rule that the election did not commence with the announcement by Mr Kavanagh and Mr Reynolds of their respective candidatures and their electioneering in May and June 2008, the conduct of Mr Reynolds and of the CFMEU, in particular, referred to by Heenan J continued right through the election period. The applicant says that, following the judgment of Heenan J, Mr Reynolds and his team continued to use the CFMEU resources, including the information on the union membership list to send out material promoting their candidature and attacking Mr Kavanagh. The applicant draws attention to "The West Australian" newspaper report dated 11 July 2008, annexed to his affidavit sworn 13 October 2008, where it was reported that Mr Reynolds specifically said that he would now also use the membership list to post his own election material out and that he would seek executive permission to do so. The applicant also refers to election flyers sent to the membership of the CFMEU on or about 22 July and 14 August 2008 by Mr Reynolds using, he contends, the union resources --- the membership list : see [25] and [27] and annexures C & E to the affidavit of the applicant sworn 20 October 2008. The applicant additionally refers to actions he says were taken by paid union organisers to promote the candidacy of Mr Reynolds: at [11], [12], [14] and [18] of his affidavit, sworn 18 March 2009. He says this conduct offers good ground for the suspicion that it was allowed to be done by the CFMEU, controlled by Mr Reynolds. He says it is significant that Mr Reynolds allowed such activities when done for him and expressly forbad them in relation to Mr Kavanagh: see [21] of the judgment of Heenan J in CFMEU v Kavanagh . The applicant also refers to further electioneering material continuing to be sent out by Mr Reynolds during the election period, however that period is to be defined: at [4] of the applicant's affidavit sworn 30 March 2009 and annexures 1 --- 6. The applicant says that Mr Reynolds also used the CFMEU magazine, Construction Worker , published Spring 2008 and his "Secretary's Address" to subtly promote his candidature during the election period, however defined, or that the union allowed its resources to be used in this way: see [5] of his affidavit sworn 30 March 2009, annexure RM7. Finally, the applicant refers to campaigning actions by paid union officials during working hours, thereby using union property and resources during the election period, however defined: see [6] of his affidavit sworn 30 March 2009. The applicant says that the overwhelming inference is that all regularly occurring conduct which promoted Mr Reynolds and his team was allowed to occur by the CFMEU. Similarly, Mr Kavanagh deposes to the fact that nominations for the position of State secretary of the [CFMEUW] are due to open on 21 August 2008 and close on 4 September 2008. He says that the ballot for that position is to be a period of not less than 21 days and not more than 28 days and a count of the ballot papers must be completed by 30 October 2008 (rule 23(18) State rules). The applicant deposes that the date for the opening of nominations for the CFMEU elections in fact occurred on or about 28 August 2008: see applicant's affidavit sworn 18 March 2009 at [13] and further affidavit of 30 March 2009 at [4] and [6]. I proceed on the basis that those statements concerning factual matters or events set out in the judgment of Heenan J are both before the Court and may be relied on for present purposes. It was not argued on any other basis. As noted earlier, the offence created by s 190, can only be committed by an organisation or branch if it uses or allows to be used its property or resources "to help a candidate against another candidate in an election". It follows that the grounds of the application referred to in [7](2) and (3) above concerning the alleged improper or other conduct of Mr Kavanagh and Mr Reynolds cannot, in these circumstances, constitute a contravention of s 190. For these reasons, those grounds must fail. The allegations made by the applicant concerning conduct which pre-dates the calling of nominations would, on the face of it, appear incapable of falling within the meaning of "irregularity" as defined. The conduct in this category is that referred to in the first two affidavits of the applicant concerning the alleged use of the CFMEU's register of members. In this regard, the "resources" alleged to have been used contrary to s 190 are said to be the union membership roll: see affidavit of the applicant sworn 20 October 2008 at [24] and [29]. The use said to have been made of the roll is said to be evidenced or inferred from "election flyers" sent out by Mr Kavanagh on 18 June 2008, 8 August 2008, and by Mr Reynolds on 22 July 2008 and 14 August 2008. The applicant says the Court should draw an inference that due to the receipt in the mail of the election flyers by the applicant, there must have been some access to the register by both Mr Kavanagh and Mr Reynolds. However, it is only the use of the register made by Mr Reynolds which the applicant says involves a contravention. That seemingly is because the applicant considers that the CFMEU was supporting Mr Reynolds and not Mr Kavanagh. The applicant's affidavit of 13 October 2008 concerning the election flyers plainly relates to the period prior to 28 August 2008 when nominations were called. Contrary to the submission of the applicant that the relevant period of "an election" and the meaning of the expression "in an election" used in s 190, and referred to above, I accept the submissions of the CFMEU, Mr Kavanagh and Mr Reynolds, as interested persons, that not only was there no "election" at material times when the election flyers were sent out, but there was also no "candidate" who could be helped by the use of resources at material times, as required by s 190. The FWRO Act expressly distinguishes between candidates and prospective candidates, for example, in s 216. In my view, if the Parliament had intended s 190 to treat conduct in relation to each in the same way, it could easily have made provision to this effect. Parliament can be taken to be fully conversant with the manner in which industrial legislation, especially that creating offences, is strictly construed by courts. Re Collins , relied on by the applicant in setting out the legislative history to s 190, is a case in point and was referred to in the Parliamentary Committee Report. When one has regard to the fact that s 190 is concerned with the assistance an organisation or branch might provide to "a candidate against another candidate in an election", it is plain that the Parliament was concerned with conduct in the course of an election by a declared candidate and not in anticipation of an election or after an election has been called but where candidates are not yet declared. All this, in my view, follows from the text of s 190 itself. However, the legislative history of s 190 in my view also goes to support that interpretation. Additionally, this interpretation of the relevant "election" period also reflects the way in which rules designed to prevent the use of union resources for particular candidates have been construed at earlier times. For example, in Tanner v Maynes [1985] FCA 487 ; (1985) 7 FCR 432 ( Tanner v Maynes) , the Full Federal Court (Evatt, Northrop and Keely JJ) had to deal with an application under s 141 of the Conciliation and Arbitration Act 1904 (Cth) for directions for performance of rules of an organisation, namely, the Federated Clerks Union of Australia. By notice given on 1 April 1985, the returning officer gave notice he was conducting an election within the Victorian Branch of the union for a number of offices. The notice called for nominations to be made at any time from 1 April 1985 but not later than 12 noon on 15 April 1985. On 3 April 1985, the applicant lodged his nomination as a candidate for the offices of Assistant State Secretary, for one of the offices of State Councillor and for one of the offices of National Councillor. Earlier on 20 March 1985, some 200 pamphlets had been observed that carried the logo of the union. The document also indicated that it had been "Issued by the Federated Clerks Union of Australia". On 10 April 1985, the applicant relying on s 141 of the Conciliation and Arbitration Act obtained a rule nisi calling upon the respondents, being the six persons named as being present at the commencement of the meeting of the National Executive Committee of the union on 31 January 1985 to show cause on 19 April 1985 why orders should not be made that they perform and observe the rules of the union, including in respect of the publishing of the pamphlet out of the funds of the union. Reliance was made on the decision in the Full Court in Scott v Jess [1984] FCA 289 ; (1984) 3 FCR 263 ( Scott v Jess ) in which Gray J at 286 --- 288 stated four principles, the first of which was that officers exercising power within an organisation shall not exercise that power to authorise the use of the resources of the organisation to support or promote a candidate or a group of candidates during the conduct of an election to offices within the organisation. In Tanner v Maynes , Evatt and Northrop JJ at 441 --- 442 (who were members of the Court in Scott v Jess ) agreed with the statement of the four principles of Gray J (which they listed as (a) --- (d)) and said of the first principle that it imposed an absolute prohibition on the exercise of powers by officers of organisations which applies during a restricted period, namely "during the conduct of the election". Their Honours observed that the prohibition did not apply, however, to the distribution of material before the commencement of an election, although that did not prevent the application of a second principle stated in Scott v Jess , that officers of an organisation are under a duty to exercise powers conferred upon them by the rules of the organisation bona fide for the purposes for which the powers are conferred. On the other hand, the third member of the Full Court in Tanner v Maynes , Keely J, considered that the first principle drawn from Scott v Jess should not be limited in the way suggested by Evatt and Northrop JJ. His Honour at 451 considered such a limitation would be unreal and artificial and that the principle was directed towards the harsh realities of what happened "in an election campaign" including the use of an organisation's resources to produce or distribute "electioneering material". This is in effect the contention now put by the applicant. Notwithstanding the real world analysis provided by Keely J, s 190 is not a provision that depends on the construction of union rules, duties to act in good faith and the like, but is an express statutory offence provision introduced by the Commonwealth Parliament to deal with a particular issue. In my view it is unambiguous that the conduct proscribed by s 190 is assistance provided to a candidate in an election. There needs to be both a "candidate" involved, and an "election". That s 190 is an offence provision is also relevant to its interpretation. A penalty provision is to be strictly construed in favour of the accused: see Trade Practices Commission v TNT Management Pty Ltd (1985) 58 ALR 423 at 427. This is an additional and compelling reason not to consider the terms "candidate" and "election" to have expansive interpretations. In such circumstances, the present real questions are: (1) is there a candidate; and (2) when does an election period commence? As to the latter question, in Hodge , relied on by the applicant as referred to earlier, Griffith CJ at 379 made it clear that the election begins when "the first step is taken that is prescribed by law as a necessary step in the process of holding an election". That view appears to have been supported by Barton J at 382 and 383, and is also consistent with what Isaacs J said at 387 concerning "the whole of an election as a combined process, a continuous process, consisting of a number of steps ending in the election of some representatives". On the material before the Court, the first step in the election process is the calling of nominations for the relevant positions. That occurred, on the facts before me, on 28 August 2008. In my view, s 190, in circumstances such as these, has no application to the conduct complained of relating to the election flyers that occurred prior to 28 August 2008. At that time there was no election underway, and, in turn, there were no candidates. I also consider there is a real question whether, on the material before the Court, it could be said in any event that the union has helped one candidate against another when the assistance complained of is the utilisation of information in a register of members, that is freely available to any member. In this regard, s 69(9) of the WAIR Act gives an unqualified right of access to the register, through the Registrar of the Western Australian Industrial Relations Commission (WAIRC). The facts suggest that Mr Reynolds wrote to the returning officer of the Western Australian Electoral Commission (WAEC) well prior to the opening of nominations in the CFMEU elections and was subsequently provided with a copy of the register: see the affidavit of the applicant, sworn 18 March 2009 at [17] and annexure A; see also Mcjannett v Reynolds [2009] WAIRComm 211 ( Mcjannett v Reynolds ) from [13] --- [29]. The applicant could have availed himself of those rights prior to nominations opening in the CFMEU elections if he intended to become a candidate at that stage. Once in possession of the register, he could have communicated with members of the CFMEU/CFMEUW for the purposes of electioneering, as Mr Reynolds and Mr Kavanagh appear to have done. The interested persons point out that the applicant complained in the proceedings in the WAIRC that he was not provided with a copy of the register in August 2008 by the returning officer of the WAEC. However, it was not alleged in those proceedings that the CFMEU, CFMEUW or other candidates had acted improperly in applying for and receiving copies of the register from the WAEC. The interested persons say that the source of the applicant's grievance is the fact that the CFMEUW elections were stayed by Ritter AP on 16 September 2008, at a time prior to the applicant receiving a copy of the register that he had requested: see applicant's affidavit sworn 18 March 2009 at [17] and annexure A. The interested persons also point out that, additionally, r 33 of the CFMEUW Rules (rules) provides that the books and register of the members of the CFMEUW "shall be open for inspection at the registered office by any financial member of the Union at all reasonable times during business hours". They contend this provides an unqualified right of access to the register and that the applicant could have availed himself of this right in order to come into possession of the register or its contents. The exercise of the right cannot be considered relevant assistance by the CFMEU in breach of s 190. The assistance provided by the CFMEUW making its register of members open for inspection under its rules, is not relevantly the conduct of the CFMEU: see Becker: in the matter of an application for an inquiry in relation to an election for offices in the Australian Education Union, Queensland Branch [2004] FCA 1534 , Cooper J at [27]. I accept these submissions. In conclusion, in relation to the election flyers, I am principally not satisfied that there are reasonable grounds for the application made by the applicant under s 200, based on a contravention by the CFMEU of s 190, because the conduct complained of, even if it be possible to characterise it as an instance of the organisation using or allowing to be used its property or resources to help a person, is not help provided to "a candidate against another candidate in an election under this Part for an office or other position", as that expression in s 190 is properly to be construed. I additionally doubt that the use of the register by Mr Reynolds, on the facts, is relevantly a case of the CFMEU allowing its resources to be used to help one candidate against another, in circumstances where the register of members may be accessed by its members. In my view, because the conduct complained of pre-dated the commencement of the election it cannot constitute a contravention of s 190. Additionally, at material times, there were no candidates declared and so s 190 was incapable of being contravened. These allegations do not provide reasonable grounds for an inquiry and must fail. In my view, the allegations made by the applicant concerning Mr Kavanagh's conduct, taken at their highest, do not involve any allegation that Mr Kavanagh acted as an agent of the CFMEU. It is impossible to see a basis therefore on which it can be said that the CFMEU used or allowed to be used its property or resources to help Mr Kavanagh against another candidate at any material time. Section 190 is only contravened if the organisation uses or allows to be used its property or resources in the relevant way. In any event, the conduct complained of was prior to the commencement of the election time when Mr Kavanagh was not a candidate. These allegations do not provide reasonable grounds for an inquiry and must fail. So far as this complaint is concerned, it seems to me that, taken at its highest, it cannot involve any contravention of s 190 because it does not involve an allegation that the CFMEU used or allowed to be used its property or resources, as explained above. This complaint is supplemented in [16] of the applicant's affidavit, by the applicant alleging that he was advised by an official of the AEC that he had "at least several hundred complaints". However, an AEC report dated 8 May 2009, states there were no written allegations of irregularity and no irregularity was otherwise identified by the AEC. In my view, there are no reasonable grounds for the application based on the particular set of allegations. At [18] of the applicant's affidavit of 18 March 2009, it is further alleged that by reason of the "sheer number" of posters seen on construction sites and on footpaths and other areas outside adjoining construction sites, union resources must have been used in the form of union organisers and other officials acting in support of Mr Reynolds. The test for determining whether or not reasonable grounds for the application have been demonstrated, as stated by French J in Re Post , makes it clear that a speculative complaint is not sufficient. In my view, this particular allegation is speculative. The allegation is that posters were put up, not only on construction sites, but also outside them. They could have been posted by any number of people. There is nothing to suggest that paid CFMEU organisers were responsible. Such an inference cannot be easily drawn. A range of people with rights of entry to a construction site at material times, for example under s 747, s 757, s 760 of the WR Act might have taken the opportunity to put up such posters. I find there are no reasonable grounds for the application based on this particular complaint. In the affidavit of the applicant sworn 30 March 2009 at [4] the applicant says that he received, at regular intervals, the further election flyers and how to vote notices, either in support of Mr Reynolds and his team, or attacking candidates other than Mr Reynolds. He considers from inquiries made with "numerous other Union members" that all of them received these further documents, that each was sent out to the entire CFMEU membership, and that the CFMEU role continued to be used as a resource to send out these documents. I accept the primary submission made on behalf of the CFMEU and supported by the other interested persons, that the allegations relating to this electioneering material refers to the use made of the register of members. That is a matter discussed above. The primary allegation is that the register was provided prior to nominations opening. The complaint made, properly understood, is simply that Mr Reynolds took advantage of the use of the register of members following the calling of nominations. I find that there is no allegation that the CFMEU provided the register of members to Mr Reynolds, during the election period, that is after 28 August 2008, when nominations were called. The material before me, as explained above, indicates that Mr Reynolds received a copy of the register from the WAEC shortly after the calling of nominations in the CFMEU elections. In those circumstances, there was no relevant "help" provided by the CFMEU out of its property or resources. I find that there are no reasonable grounds for the application based on this set of allegations. In the applicant's affidavit sworn 30 March 2009 at [5], it is alleged that in addition to that electioneering material, in or about late October or early November 2008, the CFMEU brought out the Spring 2008 edition of its union magazine, Construction Worker . The applicant says the editorial page of this magazine contained an address from Kevin Reynolds urging the membership to vote and, at least by implication, to vote for him. Thus, union resources were used in the publication and distribution of a magazine for members. It is for the officers of the organisation to determine what matters of interest may be the subject of such information, the nature of that information and the amount of the resources of that organisation to be expended. Eventually, it is for the members of the organisation to exercise control over the officers as provided by the rules. At times, the information published may be contentious and may seem to be favouring one group within the organisation and disadvantaging a competing group. If a member can prove that the publication of that information was not made by the officers bona fide for the purpose of the power conferred upon those officers, orders under s 141(1G) [a provision directed at observance of an organisation's Rules] of the [ Conciliation and Arbitration ] Act may be made directing the officers to observe and perform the rules of the organisation by refraining from expending the resources of the organisation for the publication of that information. In other words, if, on a fair view of the publication in question, it amounts to electioneering, its production and distribution will be beyond the power given by the rules, whatever may have been the subjective intent of those producing and distributing the publication. ... In my view in searching for the 'substantial purpose' of each of the documents there in question, Wilcox J in Jess v Scott was doing no more than examining each document to determine whether, on a fair view of it, it amounted to an electioneering publication, or whether any effect it may have in persuading prospective voters to form views as to how they should cast their votes was incidental to the thrust of its text. We are confident of negotiating a good outcome for our members. In the face of the global economic crisis Western Australia is probably in a better position than most to ride out the storm. I have been through major economic storms before and now is the time to steer a solid ship. The Union elections are on and I ask all members to take the time to exercise their democratic right to vote. We are a democratic union and it's one of the privileges of being a fully paid up member that you get the right to vote. Parachuting so-called super stars into seats instead of local heroes or true believers was a flawed strategy. We now watch with interest if the Barnett Liberal Government will try to introduce a version of workchoices from the ashes of 'Court and Keirath's' draconian laws against workers. Not if I can help it! Buswell has already supported the ABCC! If he goes to jail for choosing to remain silent, a right under law given to murderers but not construction workers, then it will be on the heads of the Rudd and Gillard government. We live in a country where there should be 'One Law for All' under the Southern Cross. The ABCC should be abolished now. Watch this space!!! In Victoria, barbed wire entry gates needing smart card access which can record all your movements and deny access to union reps have gone up on some sites. Workers should not have to feel imprisoned in their workplace. We will not tolerate this type of Nazi-style prison camp here in WA. Once again this highlights the need for unions to have unrestrictive access to sites to check on safety procedures and standards. Finally, figures compiled from the national office of membership numbers for all CFMEU branches showed that your WA branch achieved a record 19.8% growth in members in the year up to the end of July 2008. This is an extremely good result, achieved largely during the period of Howard's anti worker laws. " were separately printed. In my view, on an objective view of this published document it does not amount to an electioneering document. It is a general statement that encourages members to vote in the forthcoming elections. There is no mention of any candidates, let alone any criticism of any. Nowhere does the address encourage members to vote for Mr Reynolds or his team. While it might be said in a very general way that the publication of such a document during an election period might be calculated to put the author, if a candidate for election, in a good light, in my view it simply does not pass the threshold test of being an electioneering document; or having that substantial purpose. This allegation is put forward by the applicant as constituting reasonable grounds for considering the publication as the use of the CFMEU's resources in contravention of s 190. There is no separate allegation made that the CFMEU's conduct is in breach of implied rules of the types considered in Scott v Jess . I find there are no reasonable grounds for the application based on the publication of the address of Mr Reynolds. In the affidavit of the applicant sworn 18 March 2009 at [14], the applicant refers to a poster that he is informed a person saw a paid CFMEU organiser put up in the lunchroom of a workplace. He believed the same paid CFMEU organiser had put these posters up in several places during working hours. In his affidavit, made 30 March 2009 at [6] and [7], the applicant additionally alleges that paid CFMEU officials attended a particular construction site during their normal hours and campaigned for themselves and put up posters and stickers for themselves and the Reynolds team and removed stickers and posters belonging to opposing candidates. The applicant contends that the conduct of paid CFMEU officials in acting in these various ways provides reasonable grounds for considering that the CFMEU has used or allowed to be used its property or resources to help a candidate. In my view, the contention of the applicant fails. While questions are raised by such conduct, they do not in my view, constitute "reasonable" grounds for the application. This is because: In my view, the allegations, taken as a whole, do not rest upon any substantial factual foundation, as required by the test enunciated in Re Post . The conduct of persons such as union officials during an election, are almost bound to attract allegations of the type made by the applicant here, in that they may often find it difficult not to show some inclination to partial conduct. In my view, not every technical or incidental action of a union official that might be characterised as involving the use of union resources, should be so characterised. Questions of fact and degree arise. It is one of the inherent advantages of an incumbent seeking re-election that he or she will have opportunities for favourable exposure to the electorate by attending meetings, communicating with members, formulating or expressing policies on behalf of the organisation and exercising patronage in the making of appointments. There may also be circumstances in which to deny a salaried officer or employee a technical, or incidental, use of the organisation's resources for electioneering purposes, as in the transport of campaign material in the organisation's vehicle for distribution outside working time, would be to place that officer or employee at an unfair disadvantage. It is undesirable in the circumstances of the present case to attempt to define with any more precision what may amount to a technical or incidental use, in that sense, of an organisation's resources. In the event, for the reasons I have set out above, I am not satisfied that the conduct complained of, all of which has a generalised, second hand aspect to it, constitutes reasonable grounds for the application. The onus to make out a case is on the applicant in bringing an application. On the materials presented by the applicant I am not satisfied that there are reasonable grounds to consider that there is any irregularity by reason of conduct on the part of the CFMEU that is said to contravene s 190. In these circumstances, I would dismiss the application by the applicant for an inquiry by the Federal Court in relation to the elections for offices in the CFMEU the subject of the application. The Court would therefore order: The application by the applicant for an inquiry by the Federal Court in relation to the election for offices in the CFMEU that were declared on 25 November 2008 is dismissed. I certify that the preceding one hundred and four (104) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker. | application for an election inquiry s 201(b) of the fair work (registered organisations) act 2009 (cth) construction, forestry, mining and energy union election whether reasonable grounds for application by reason of irregularity whether conduct contravenes s 190 of the act application dismissed industrial law |
By that judgment, the Federal Magistrates Court dismissed the applicant's application for an order that the respondents show cause why a remedy should not lie under s 476 of the Migration Act 1958 (Cth) ("the Act ") in respect of a decision of the Refugee Review Tribunal ("the Tribunal") by which the Tribunal affirmed a decision of the Minister's delegate to refuse the applicant the grant of a Protection (Class XA) visa under the Act . Subject to the limitations contained in s 476(2) , s 476(1) of the Act confers the same original jurisdiction in the Federal Magistrates Court in relation to a migration decision (as defined by the Federal Magistrates Court Rules ) as that exercised by the High Court under para 75(v) of the Constitution . 2 The application for the grant of a show cause order was listed for hearing on 10 June 2008 under r 44.12(1) of the Federal Magistrates Court Rules . Rule 44.12(1)(a) provides that at the hearing of such an application, the Court may dismiss the application if it is not satisfied that the application raises an arguable case for the relief claimed. Rule 44.12(2) provides that a dismissal of such an application under para (1)(a) of r 44 is an interlocutory order. On 10 June 2008, Federal Magistrate Smith dismissed the application under r 44.12(1)(a) on the footing that the application did not raise an arguable case for the relief claimed. 3 The judgment was pronounced orally. The applicant attended the hearing and was assisted by an interpreter skilled in the applicant's Chinese dialect (the Fuqing dialect) and the English language. The applicant was present when Federal Magistrate Smith pronounced judgment. The applicant was that day handed the sealed orders of the Court. 4 The applicant filed an affidavit on 16 July 2008 in support of the application for an extension of time to file a notice of appeal. The applicant says that the judgment was not posted to her until 23 June 2008; she did not receive it until 30 June 2008; and she thought she had 21 days from the date of receipt of the judgment to file a notice of appeal. By s 24(1A) of the Federal Court of Australia Act 1976 an appeal does not lie from a judgment of the Federal Magistrates Court exercising original jurisdiction under a law of the Commonwealth (s 24(1)(d)) without leave, if the judgment is an interlocutory judgment. The application for leave ought to have been filed within 21 days of pronouncement of the judgment on 10 June 2008 ( i.e. by 1 July 2008). The present application was filed on 16 July 2008. The first respondent opposes the application for an extension of time to file a notice of appeal on the same grounds that leave to appeal is opposed, namely, that the applicant has no prospect of success in any appeal and the judgment of Federal Magistrate Smith is not attended with sufficient doubt so as to warrant consideration by the Full Court of this Court. 5 Since the delay in filing the application is short and the applicant was not assisted by a lawyer before the Federal Magistrates Court, the failure to file the application within the time limited by the Rules is sufficiently explained. The real questions are whether the judgment of the Federal Magistrates Court is attended with sufficient doubt so as to warrant reconsideration by an Appeal Court and whether substantial injustice would result if leave were refused ( Décor Corporation Pty Ltd v Dart Industries Inc. [1991] FCA 655 ; (1991) 33 FCR 397 ; Herald & Weekly Times Ltd v Williams [2003] FCAFC 217 ; (2003) 130 FCR 435 at 440 [19] ; and MZWRW v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCA 1665). In a case where the question of substantial injustice is to be assessed in the context of contended error by the primary court in addressing whether the Tribunal engaged in jurisdictional error in relation to a claim of well-founded fear of persecution for a Convention reason (1951 Convention Relating to the Status of Refugees as amended by the 1967 Protocol Relating to the Status of Refugees: see ss 65(1) and 36 (2)(a) of the Act ), error on the part of the primary court on the issue of the Tribunal's jurisdiction is likely to give rise to injustice which satisfies the test. Although the two issues are separate, they are necessarily related and must be carefully balanced. The gravity of the consequences of error in the case of a refugee claim may prove to be very significant. The primary question in this application is whether the judgment of the Federal Magistrates Court that the applicant's application for a show cause order was to be dismissed as disclosing no arguable case for the relief claimed, is attended with sufficient doubt so as to warrant consideration by this Court in the exercise of its appellate jurisdiction. The draft notice of appeal contends for these grounds of appeal. First , Federal Magistrate Smith erred in law. Secondly , the primary judge was "wrong in finding that the [Tribunal] acted properly in its findings". As particulars of that ground, the applicant contends that the Tribunal failed to comply with its obligations under s 424A(1) of the Act . The applicant says that the Tribunal considered certain information and failed to give the applicant particulars of that information before relying upon it in reaching its decision. The criticism is that the Tribunal reached conclusions about the weight to be attributed to three documents and the reliability of information contained in the documents, without putting to the applicant those elements of the documents about which it was concerned or alternatively the basis upon which the Tribunal elected to discount the documents in assisting it to reach its decision. Thus, the applicant was not given, it is said, an opportunity to comment on the documents. The three documents were a letter from the applicant's husband in the form of a facsimile. The second was a letter from a representative of the applicant's Church in Sydney and the third was a declaration from a man (who I will describe as Mr XTH) who said that he had known the applicant since May 2007 and who also spoke about the applicant's engagement with the Church. 7 Thirdly , the Tribunal "failed to consider my claims properly and fairly". As particulars of that ground, the applicant again relied upon a contended failure on the part of the Tribunal to consider information contained in a facsimile from the applicant's husband and information provided by another male witness. Fourthly , the Tribunal's decision "has included a reasonable apprehension of bias". As particulars of apprehended bias, the applicant asserted that the Tribunal disregarded the applicant's evidence that she attended a local Church in Sydney. The Tribunal said in its reasons that the evidence was to be disregarded under s 91R(3) of the Act on the footing that the applicant had attended a local Church in Sydney simply for the purpose of acquiring some knowledge of the Christian religion in order to strengthen her claims for protection. 8 In order to deal with these proposed grounds of appeal, it is necessary examine the claims made by the applicant, the treatment of those claims adopted by the Tribunal and the treatment by Federal Magistrate Smith of the contended errors on the part of the Tribunal. The applicant claimed to hold a well-founded fear of persecution on the ground of her practice of the Christian religion. In a declaration sworn 7 June 2007, the applicant claimed that she was married; had two children in the People's Republic of China; and a brother living in Australia who is now an Australian citizen. The applicant claimed in her declaration that she had grown up in circumstances of poverty; did not attend school; and became a victim of domestic violence. In January 2006, she was befriended by a person who was a member of the Christian "Shouter" movement. The applicant contended that she attended gatherings of adherents of the faith every Tuesday, Friday and Sunday at various and changing places due to the illegality of the Christian faith in China. On 1 May 2006, the applicant was baptised with five other believers. The applicant's husband became a Christian and was baptised on 1 October 2006 which transformed his behaviour. The applicant claimed that her parents tried to persuade her to discontinue her involvement in the Church and asked her brother in Australia (among others) to arrange for her to go overseas in case she was in danger. The applicant obtained a passport in December 2006. 10 On 17 April 2007, the applicant attended a Christian gathering. She contended that she received a telephone call to tell her that fellow Christians had been arrested. Her husband asked her to return home and then arranged for her to go to Guangzhou with her brother for some time. While in Guangzhou, the applicant was told that her husband had been arrested by police on 21 April 2007 and her home had been searched by members of the Public Security Bureau ("PSB") of the PRC. The applicant contended that she left Guangzhou on 23 April 2007. The applicant arrived in Australia on 24 April 2007. In her declaration of 7 June 2007 the applicant said that shortly after her arrival in Australia it was confirmed to her that police had looked for her on 21 April 2007 because she had been regarded "as one of [the] key members of the Local Church who had played [an] important role in recruiting new members for [the Christian] gathering group". The applicant claimed that the police could not find her and then took her husband to a PSB facility. The applicant claimed in her declaration that she had been informed that she would be arrested "immediately if I return to China". The applicant concluded her declaration by saying, "Thanks my Lord, I have found the local Church in Australia; and therefore I am able to continually practice my religion in this country". 11 The applicant appeared before the Tribunal on 1 November 2007. The applicant gave evidence and presented arguments. The Tribunal notes at p 4 of its reasons (Green Book "GB" 109) that the applicant was assisted by an interpreter "in the Fuqing (Chinese) and English languages". 12 The Tribunal explored a number of the matters relied upon by the applicant, with her during the course of the hearing. The applicant told the Tribunal that since arriving in Australia she had been living with her brother in Killara, Sydney. The Tribunal asked the applicant whether she had received any help in preparing the documents for her protection visa application and in particular the declaration of 7 June 2007. She said that members of the Church community in Sydney had helped her prepare the documents. The applicant told the Tribunal she had given details of her circumstances to Church members who had helped her write the declaration. She gave the information in her own language and it was written down by them in Chinese. The documents were then given to an agent who had the information translated into English. 13 The second topic considered by the Tribunal was whether the applicant had experienced any difficulty in leaving China. The applicant departed China to Australia on a passport issued to her in her own name. The applicant said that the government wanted to arrest her. Her brothers and sisters had helped her to leave. The applicant told the Tribunal that she met a fellow passenger, a Chinese person who helped her with the departure forms both at the airport and on the plane. The applicant told the Tribunal that Chinese authorities had not questioned or queried her passport. The applicant explained that at that stage (23 April 2007) the authorities in the PRC did not know about her. The applicant said that her husband had been arrested on 21 April 2007 (although at GB110, the Tribunal wrongly records that date as 21 April 2006). She told the Tribunal that Church people were afraid that she would be arrested as she was a member of the Church. 14 The third topic raised with the applicant was information derived from independent country information. That information suggested that persons known adversely to PRC authorities had difficulty leaving China on their own passport. The Tribunal suggested to the applicant that since she had left China without any difficulty, that circumstance might suggest that she was not adversely known to Chinese authorities and thus may not have been at risk at all. Alternatively, the Tribunal raised the possibility that ease of departure might suggest that the applicant was not a member of the Church Shouter group of believers as she contended. 15 The applicant told the Tribunal of her background and life in a village in Fuqing City, her relationship with her friend who introduced her to the Church and the notion that her family were "saved by God". At GB111, the Tribunal refers to the arrest of the applicant's husband describing that date again as 21 April 2006. 16 The fourth topic concerned the circumstances surrounding the applicant's request for a visitor's visa to enter Australia. The Tribunal records at GB111 that the applicant told the Tribunal that "Church [members] told her to leave the PRC on 23 April 2006". That date ought to have been recorded as 23 April 2007. The Tribunal records the applicant as telling the Tribunal that Church members had told her that if information about her was entered into the government computer system "she would be in trouble". The Tribunal pressed the applicant as to the date when she applied for an Australian visitor's visa. The applicant seemed unable to answer that question and said that everything had been arranged by Church members. The Tribunal pressed her as to the reasons why she was in hiding and she responded that police wanted to arrest her. The Tribunal pressed the applicant as to what plans were in place when the applicant went into hiding on 17 April 2007 (the Guangzhou hiding). The applicant told the Tribunal that she had no plans and that Church people had arranged everything. 17 The Tribunal then put to the applicant that her Australian visitor's visa was granted to her on 28 March 2007 and secondly, that that date was before she knew on 17 April 2007 she was in danger. The applicant responded by telling the Tribunal that from 2006 she was aware of "trouble from the authorities" and was advised to obtain a passport "in case". Accordingly, she did so in December 2006. The applicant told the Tribunal that when she obtained the visitor's visa on 28 March 2007 she was planning to leave the PRC because the authorities were planning to arrest her. Again, the Tribunal put to the applicant that she had obtained the visa before she knew of any interest on the part of PRC authorities in her activity as a Christian believer, on 17 April 2007. The applicant responded by saying that in 2006 she had preached to people and "was considered a kind of leader by the authorities". 18 The fifth topic addressed by the Tribunal concerns a letter given to the Tribunal authored jointly by two men identifying themselves as "responsible brothers" of "The Local Church in Sydney". Please do not hesitate to contact [WP --- phone number] should you have any further enquiry. The Tribunal put to the applicant that this letter had not been provided to the Minister's delegate at the time of the visa application or on the review application. The letter of course was dated 29 October 2007. The visa application was lodged on 7 June 2007. The application for review before the Tribunal was lodged on 14 September 2007. The Tribunal plainly was intending to convey a concern that a letter in the terms of the letter of 29 October 2007 might have been expected to form part of the documents filed either in June or September 2007. 20 The sixth topic concerned the nature of the applicant's relationship with her brother in Australia. The applicant told the Tribunal that she had not told her brother of her practice of the Christian faith in China and nor did she tell her brother of her broader marital problems. The applicant said that her brother did not know of her involvement with the local Church in Australia. The Tribunal then drew the applicant's attention to what it described as the conflict in her evidence to the Tribunal about living with her brother. The Tribunal noted that the applicant initially said that she lived with him in Kallara and then later said that she did not. The applicant then told the Tribunal that the person previously described as her brother was in fact a distant cousin rather than her brother. The Tribunal put to the applicant that she had identified him as her brother in her visa application. The applicant explained the apparent anomaly by saying that she did not make any distinction between a brother and a cousin. 21 The seventh topic concerned the applicant's method of attendance at Church meetings in Sydney. The applicant told the Tribunal that she travelled to such meetings by train. The Tribunal asked her at which station did she get off the train. The applicant did not know. The applicant told the Tribunal she had been given a piece of paper with the address and she showed this paper to people who told her where to go. She said that she caught the train from Kallara to the City and then Church people would pick her up. The applicant was asked at which station did she get off the train in the City and she told the Tribunal, Platform 16-17. The applicant was unable to name the station. She told the Tribunal that she had been making this trip since May 2007. She said that there were gatherings every Monday and Sunday. Although she did not attend on each of those days she attended on most Sundays and last attended on 28 October 2007. In order to explore that matter further, the Tribunal asked the applicant whether her brother could provide any evidence of her engagement with the Church. The applicant told the Tribunal that her brother was not involved in the Church. The Tribunal put to the applicant that as she lived with him he would presumably be aware of her involvement with the Church. In response, the applicant told the Tribunal that her brother does not live at the Kallara house. The applicant told the Tribunal that her brother owns the house and it is rented to her and three others. 22 At the conclusion of the hearing on 1 November 2007, the Tribunal adjourned to 21 November 2007 in order to enable the applicant to respond to various issues raised during the hearing. On 3 December 2007, the applicant's migration agent sent the Tribunal a further statutory declaration dated 29 November 2007; a copy of a letter written and faxed from the applicant's husband and a statutory declaration from Mr XTH who is a "Church brother" of the applicant in the local Church in Sydney. 23 As to the applicant's husband's facsimile (GB76), the applicant's husband described his wife as a pious local Church member who played an important role in the village underground Church in China and encouraged him to take part. He describes the transformation in his character by reason of Church activities. He said that when Chinese authorities found that his wife was a local Church member, he and his wife had "no peace at home". The PSB arrested people and did not spare his family. He contended that if his wife returns to China "she would definitely be persecuted by the Chinese government". 24 As to the declaration sworn by Mr XTH (GB79), he says that he is a Christian in the local Church and has known the applicant since May 2007. He says that the applicant attended weekly worship every Sunday in the City on a regular basis and attended group gatherings regularly every Friday in Auburn. Mr XTH says that he has personally witnessed the applicant participating in these Christian activities. As to the applicant's declaration of 29 November 2007, the applicant sought to explain some of the matters put to the Tribunal on 1 November 2007. 25 The applicant then explained that her mother was then suffering from serious cancer in China and family members including "my brother Mr XYH who is an Australian citizen, have blamed me for my mother's illness". They did not like to get implicated by my matter; and they were afraid that they might have troubles with PRC authorities if they were found to have any connections with me. Therefore, they did not like me to say too much about them. It is owing to above-reasons that I had to tell the Tribunal that Mr XYH was not my brother because I knew that they were going to return to China and because I did not want to give him or his family any troubles. But, as a matter of fact, he is my blood brother. It is also for the reason mentioned above that I had to tell the Tribunal that I had not stayed at his place in Australia but actually, I am living there. In that letter, the Tribunal referred to the departmental file which was before the Tribunal and a tape-recording of the applicant's interview with the delegate which took place on 24 July 2007. The Tribunal noted in its letter that the applicant's answers to issues raised on p 8 of the delegate's decision indicated that the delegate found that the applicant had very little knowledge of the Christian religion and its foundation principles. The Tribunal said that that information was relevant as it might lead the Tribunal to conclude that the applicant was not a Christian in China as claimed. The Tribunal said that it may lead it to find that the applicant had not suffered persecution in China as claimed and that the claims made in the protection visa application and at the hearing were not true. 27 The Tribunal in its letter said that it had received the evidence in relation to the applicant's claimed attendance at the Sydney Church (the letter dated 29 October 2007 from the joint authors WP and AU) and the declaration from Mr XTH's sworn 29 November 2007. The Tribunal said that it may find that the applicant had attended the "Local Church" meetings in Sydney for the purpose only of acquiring knowledge of the Christian religion and in order to strengthen the applicant's claims for protection. The Tribunal said that under s 91R(3) of the Act , conduct engaged in by a person in Australia must be disregarded when determining whether the person has a well-founded fear of persecution for a Convention reason, unless the person satisfies the Tribunal that he or she had engaged in the conduct otherwise than for the purpose of strengthening a claim to be a refugee. The Tribunal said that it may disregard the evidence it held concerning the applicant's involvement with the Church in Australia. The Tribunal said that it may conclude that the applicant did not have a genuine commitment to the Christian religion and that she would not continue to practice the Christian religion in China in the future. The Tribunal said it may find that the applicant would not face persecution in China for a Convention related reason. 28 In response, the applicant submitted a further statutory declaration to the Tribunal sworn 19 December 2007 (GB97 and GB98). 29 In that declaration the applicant explained that she came from Fujian Province in PRC where she mostly spoke a particular dialect used in the Province called Fuqingness. The applicant said that she had little education and thus the combination of her poor education and the particular dialect she speaks made her become "very scared" in "formal" or "official" situations such as the circumstances of an interview with a representative of the Minister's Department or the Tribunal. In such a situation, I was unable to demonstrate my religious knowledge. Furthermore, particular teachings of the Local Church have made it difficult for me to answer the Departmental questions. For example, we normally do not practice celebrating Christmas or Easter in the Local Church, because neither Christmas nor Easter were originally in relation to the birth of our Lord Jesus Christ and with the incarnation and resurrection of our Lord Jesus Christ. 30 The applicant contended that she had sufficient religious knowledge but was unable to demonstrate it at the Departmental interview. I have to emphasise that my attending at the Local Church in Sydney is definitely NOT for the [purpose] of strengthening my claims to be a refugee. It is not only for me to continue my religious practice in Sydney but also mostly for me to have a chance to pray for my church brothers or sisters who are still in China under the Communist dictatorship and who have been subjected to persecution by the PRC authorities. At GB115, the Tribunal recognised that the applicant speaks a dialect which the Tribunal described as "Fuqingness". The Tribunal concluded that there was no indication to it at any time during the hearing that the applicant had any difficulty in understanding questions put to her or in giving evidence, with the assistance of the interpreter, to the Tribunal. At GB115, having recognised the applicant's linguistic dialect as Fuqingness, the Tribunal then wrongly, in the next sentence, described the interpreter assisting the applicant as a "Mandarin interpreter". It is plain from the preceding sentence and from the introductory remarks at GB109 that the Tribunal was clearly conscious of the fact that the interpreter was providing assistance in the Fuqing dialect. 32 The Tribunal concluded that it did not find the applicant to be a credible or truthful witness for a number of reasons. The Tribunal reached that conclusion by reason of "inconsistencies in her evidence". One inconsistency described as "of particular significance" concerned the change in position in relation to the evidence given about the applicant's brother. The Tribunal was plainly concerned that the applicant had given evidence that her brother was in Australia and that she was living with him. Later, the applicant described that person as her cousin. The Tribunal noted the explanation for the change in position contained in the statutory declaration of 29 November 2007. The description of her brother as her cousin had been given, she said, in order to avoid problems for her brother upon his return to the PRC arising out of the illness of the applicant's mother. The Tribunal noted however, that the version of events by which she described her brother as her cousin was given in response to a proposition put to the applicant that since she was living with her brother she would be in a position to obtain evidence in support of her claims, especially in relation to her commitment to the Christian religion. She said she could not do so because her brother was her cousin and she was not living with him. 33 These matters represented, in the mind of the Tribunal, a significant inconsistency which led the Tribunal to conclude that the applicant's evidence "often appeared rehearsed". 34 The Tribunal concluded that the applicant appeared to be vague in respect of other matters. The Tribunal noted that the applicant was unable to name the location of the Church she had been attending for many months and nor could she tell the Tribunal the name of the station where she alighted from the train she took to attend services at the Church. 35 The Tribunal was concerned that although the applicant claimed she had converted to Christianity in March 2006 in China, had been baptised on 1 May 2006 and had been an active member of the Church, she demonstrated a lack of basic knowledge about the Christian religion when interviewed by the department. The Tribunal accepted that the applicant may have been nervous but did not accept that there was a language issue which prevented her from providing answers to questions. 36 The Tribunal considered the evidence put to it by the applicant of the applicant's husband's facsimile. The Tribunal was concerned that there was no way of establishing the identity of the writer or the origin of the facsimile. For those reasons, the Tribunal elected to "not give this evidence any weight". It did so in the context of its concern about the origin of the facsimile and its earlier expressed view concerning a significant inconsistency in the applicant's evidence which had caused it to conclude that the applicant was neither credible nor truthful. The Tribunal then considered the letter from Mr WP and Mr AY [18] dated 29 October 2007. The Tribunal noted that the letter did not make any mention of personal knowledge of her activities in China. For that reason, the Tribunal chose not to give any weight to the letter from the joint authors. That letter might have been consistent with a claim by the applicant that she was a practising member of the Christian faith. The Tribunal might have elected to have regard to that fact in weighing all of the evidence. However, the Tribunal chose to disregard that letter as, in its view, it did not speak to the central matter which was the claim by the applicant to have practised the Christian faith in the PRC thus giving rise to a well-founded fear of persecution should the applicant return to the PRC. The Tribunal also considered the declaration by Mr XTH sworn 29 November 2007 and elected to place no reliance upon that declaration for the same reason that the Tribunal chose to place no weight upon the letter from the joint authors. The Tribunal was concerned that Mr XTH's declaration gave no real detail of his own involvement in the Church. The declaration asserted that he had known the applicant since May 2007 and that the applicant had attended Church since that time. 37 The Tribunal weighed all of the evidence in the balance. The Tribunal in doing so was further concerned about an apparent inconsistency between the applicant's claim that she had been regularly attending Church since May 2007 for a period of six months yet was unable to provide the Tribunal with evidence of the address of the Church, the name of the suburb for the Church or the train station to which she travelled to regularly attend the Church. In weighing all the evidence, the Tribunal concluded that it could not accept that the applicant was a Christian or a member of the "Shouters" group in China. The Tribunal did not accept that the applicant had been active in the practice of religion in China. Notwithstanding the inconsistency concerning her knowledge of the location of the Sydney Church, the Tribunal found that the applicant had attended the Church "at some time" but not on a regular basis. The Tribunal concluded that it could not be satisfied that the applicant had been a member of the "Local Church" in Australia since her arrival in May 2007. As to her attendance at the "Local Church" at irregular times, the Tribunal concluded that it was not satisfied that the applicant attended that Church otherwise than for the purpose of strengthening her claim to be a refugee. Having regard to those earlier findings, the Tribunal concluded that it could not be satisfied that the applicant would practice as a member of the Christian faith or as a member of the Christian "Shouter" group should she return to China. The Tribunal took into account the claims and weighed each of them both independently and cumulatively. The Tribunal concluded that it was not satisfied that the applicant had suffered harm nor that the applicant held a well-founded fear of serious harm on the basis of her contended commitment to the Christian faith. The Tribunal explained that it had disregarded "her religion related conduct in Australia as it is not satisfied that she engaged in that conduct otherwise than for the purpose of strengthening her claim to be a refugee". 38 Accordingly, the Tribunal affirmed the decision of the Minister's delegate not to grant the applicant a protection visa. As to the first ground, there is nothing in the material which demonstrates that Federal Magistrate Smith erred in law. There is no elaboration upon that ground. I have examined all of the material in order to satisfy myself as to whether there is any error in law not properly particularised or identified by the appellant. There are some factual errors in the Tribunal's decision. Those errors concern the Tribunal's failure to record, in two places, the date of arrest of the applicant's husband as 21 April 2007. The Tribunal had described that date as 21 April 2006. However, in other places the date is correctly recorded and it is clear from the chronological context of the discussion in relation to the events of 23 April 2007 that the Tribunal was intending to refer to the earlier date of 21 April 2007, contextually, but simply and mistakenly recorded the date as 21 April 2006. The second error concerned the description of the interpreter as a Mandarin interpreter rather than an interpreter conversant with the Fuqing dialect. As I have already indicated that mistake was a factual mis-description. Contextually, the Tribunal had earlier described, in two places, the interpreter's linguistic skill as one in the Fuqingness dialect. Neither of those mistakes affected the analysis of the claims nor the conclusions reached especially in relation to the evidence analysed by the Tribunal which, in its view, revealed inconsistencies of treatment calling into question the credit of the applicant. 40 The second proposed ground of appeal is that the primary judge erred by wrongly finding that the Tribunal had acted properly in reaching its findings. The particulars of improper procedure on the part of the Tribunal in reaching its findings, rely upon a contended failure on the part of the Tribunal to discharge its statutory obligation under s 424A(1) of the Act . The essence of that complaint is that the Tribunal failed to tell the applicant of its process of reasoning in relation to the proposed treatment of the facsimile by the applicant's husband, the letter from the joint authors Mr WP and Mr AY and the declaration sworn by Mr XTH. All of these documents were put by the applicant to the Tribunal. There was no obligation upon the Tribunal to put matters going to those documents to the applicant nor the process of reasoning influencing the mind of the Tribunal in relation to its review of the documents put to it by the applicant. Nevertheless, the Tribunal in its letter dated 5 December 2007 noted that it had received evidence concerning the applicant's claimed attendance at the Church in Sydney and expressly referred to the letter from the joint authors dated 29 October 2007 and the declaration by Mr XTH. The applicant was invited to comment further about those matters. 41 The third proposed ground of appeal is that the Tribunal failed to consider the applicant's claims properly and fairly. The specific matter amplifying that contention is that the Tribunal failed to consider the material contained in the facsimile from the applicant's husband and information provided by Mr XTH in his declaration sworn 29 November 2007. However, it is clear from the reasons that the Tribunal considered those documents, plainly took them into account and weighed them in the balance in the context of the overall assessment by the Tribunal of the applicant's own evidence which, in its view, revealed a significant inconsistency in respect of one class of evidence ( i.e. the evidence in relation to the applicant's brother) and inconsistencies in other evidence concerning the level of familiarity of the applicant with the location of the Church and the extent of the applicant's apparent knowledge of core or basic tenets of the Christian faith. 42 By the fourth ground, the applicant contends that she holds a reasonable apprehension of bias on the part of the Tribunal. The basis for that apprehension lies in the Tribunal's disregard of the applicant's evidence that she attended the Local Church in Sydney. The Tribunal said that it disregarded that evidence under s 91R(3) of the Act as it could not be satisfied that the applicant had attended Church services (irregularly in its view) otherwise than for the purpose of acquiring some knowledge of the Christian religion in order to strengthen her claims of a commitment to the Christian faith and a well-founded fear of persecution should she return to the PRC and practice that faith. In the applicant's declaration sworn 19 December 2007 and submitted to the Tribunal in response to the s 424A(1) letter of 5 December 2007, the applicant acknowledged her understanding of s 91R(3) but emphasised that she was not attending Church services in Sydney to strengthen her claims but rather to pray for her brothers and sisters in China living under the Communist dictatorship. The conclusion that the Tribunal could not be satisfied that the applicant attended Church services in Sydney otherwise than for the purpose of strengthening her claims was a conclusion which emerged from an analysis of all of the evidence including the documents put to the Tribunal and the Tribunal's assessment of the oral evidence of the applicant. There is nothing in the material to suggest actual bias on the part of the Tribunal. The Tribunal's conclusion on this issue is not the expression of conduct which gives rise to an apprehension of bias. It is a conclusion reached by the Tribunal arising out of a process of reasoning and forensic analysis of the evidence which the Tribunal addressed expressly as part of its statutory role. The Tribunal disregarded the evidence of the applicant's attendance at Church services in Sydney, as it was required to do under the Act , as it could not be satisfied of the relevant matter for the purposes of the Act . 43 It follows therefore that none of the grounds of appeal which the applicant would wish to agitate by way of an appeal has any prospect of success. Accordingly, the judgment of the Federal Magistrates Court that the applicant's application for an order that the respondents show cause, ought to be dismissed on the footing that the application failed to disclose an arguable basis for the relief sought, is an order which is not attended with any doubt. I have examined in considerable detail the criticisms of the judgment of the Federal Magistrates Court and the decision of the Tribunal in order to be satisfied as to whether it might be said that the decision of the Federal Magistrates Court is attended with sufficient doubt to warrant reconsideration by an Appeal Court and whether substantial injustice might arise should leave not be given. Since I have concluded that none of the proposed grounds of appeal have any prospect of success, I am satisfied that leave ought not to be granted. I am therefore also satisfied that substantial injustice does not arise by refusing the application to extend time for the filing of a notice of appeal and by refusing the application for leave to appeal. 44 Accordingly, the application of 16 July 2008 must be dismissed with an order that the applicant pay the costs of the first respondent of and incidental to the application. I certify that the preceding forty-four (44) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood. | consideration of an application for leave to extend time for the filing of a notice of appeal from an order of the federal magistrates court dismissing the applicant's application for an order that the respondents show cause why an order ought not to be made pursuant to s 476 of the migration act 1958 (cth) consideration of an application for leave to appeal an interlocutory order of that court migration |
Lipscombe Child Care terminated her employment on 18 October 2005. Ms Duncan's claims arise out of the circumstances of that termination. She says that, in breach of a Grievance Procedure which formed part of her contract of employment, and despite the fact that she was unwell, she was not given a reasonable opportunity to answer allegations against her. Further, the second respondent Ms Anjanette Murfet, the Chairperson of the Board of Lipscombe Child Care, read out to some 25 staff members the letter of termination which contained false and defamatory allegations against her. 4 It is alleged that Ms Murfet aided, abetted and procured, and was directly and knowingly involved in, the contraventions of the TPA. However, a fundamental change to the standard to be applied in strikeout applications has been introduced by s 31A of the Federal Court of Australia Act 1976 (Cth) which came into effect on 1 December 2005. 7 The present proceeding was commenced by the filing of an application on 8 November 2005, before s 31A came into operation. The strikeout application was heard on 17 March 2006, by which time s 31A was in force. 8 In my opinion, s 31A applies to the present strikeout application. The provision is of a procedural rather than substantive nature. In Rodway v The Queen [1990] HCA 19 ; (1990) 169 CLR 515 the High Court was concerned with the appellant's convictions for certain sexual offences. At the time of the alleged offences the Criminal Code (Tas) required corroboration of the evidence of the complainant but by the time of the trial that requirement had been repealed. The High Court upheld the ruling of the trial judge (Neasey J) and the Court of Criminal Appeal that the repealed provision did not apply. It may govern the way in which the right is to be enforced or vindicated, but that does not bring it within the presumption against retrospectivity. The substantive rights of Ms Duncan which came into existence in October 2005, eg her right to damages for any breach of contract, have not been affected. The present case is not in principle distinguishable from Rodway . It is said that at all material times Lipscombe Child Care was engaged in trade or commerce by conducting the business of a child care service. 11 Paragraph 5 alleges a contract of employment (the Contract) made on 24 September 2001 whereby Lipscombe Child Care retained the applicant as Director of the Service. Staff should discuss grievances with the Director/Assistant Director as soon as possible, to facilitate the process of prompt resolution". Respect for team members should be maintained at all times. Confidentiality will be observed at all time sand discussions, even though informal, will be conducted in strict confidence. In most cases this will involve the Director/Assistant Director, the Complainant and the Respondent. 14 Paragraphs 11-12 allege that on 7 October 2005 Ms Duncan became seriously ill and was unable to carry out her employment and that she delivered to the respondents a medical certificate that she was unfit for employment duties until 21 October. 15 Paragraphs 13-15 allege a requirement by the respondents for Ms Duncan to attend a meeting on 12 October and that Ms Duncan declined because of her incapacity. It is said that Ms Duncan replied that because she was incapacitated she could not respond by the time fixed. The Lipscombe Child Care Service Board has lost their trust and confidence in the Director to manage the centre effectively. The Lipscombe Child Care Service Board has lost their trust and confidence in the Director to report to the Board honestly. 18 Paragraph 23 alleges that the applicant had "not been afforded the benefit of the procedural fairness outlined in pars (i)-(iv) of the said Grievance Procedure" and that as such Lipscombe Child Care has wrongly breached the contract of employment. Paragraph 24 alleges that as a consequence of the breach the applicant has not been permitted a reasonable opportunity to answer the allegations made, not been permitted to avail of mediation in accordance with the Grievance Procedure, not been afforded confidentiality, and not been afforded any prior warning, informal discussion or notice of the allegations made against her. 19 Paragraph 25 alleges that each of the allegations made against the applicant in the letters of 29 September, 13 October and 18 October are false and untrue. 20 Paragraph 26 alleges loss and damage as a consequence of the breach of the Contract. 21 Paragraphs 27 and 28 allege a "further breach of the Grievance Procedure and further breach of the Contract". Ms Murfet, in the presence of the Board and substantially all the staff of Lipscombe Child Care, approximately 25 persons, read the contents of the letter of 18 October and "several times" repeated those allegations. 22 The publication of the letter of 18 October is alleged by par 29 to have been conduct in trade or commerce of Lipscombe Child Care in its business as a provider of child care services. By par 30 it is alleged that the allegations in the letter were false and untrue and the conduct of publishing them was misleading and deceptive and in breach of s 52 of the TPA. By par 31 loss and damage is alleged. 23 By par 32 it is alleged the conduct of the Lipscombe Child Care and its agent Ms Murfet in unfairly dismissing Ms Duncan, failing to afford her procedural fairness, taking advantage of her incapacity and wrongfully publishing the allegations was "unconscionable in that it was scurrilous and amounted to an abuse of position and wrongfully took advantage of the superior position that (Lipscombe Child Care) had to (Ms Duncan) pursuant to (the Contract) and as such the conduct constituted a breach of s 51AA of the (TPA)". 24 Paragraph 34 alleges Ms Murfet's accessorial involvement in the breaches of ss 52 and 51AA. 25 Paragraphs 35-40 plead a case in defamation based on the publication of the allegations in the letter of 18 October. There is before the Court a formal document headed "Contract of Employment" signed by Ms Duncan and the President of the Management Committee to which is attached a "Position Description and the Staff Policy". However, the present case is one where there is a formal, written contract of employment, quite detailed and complete in itself, entered into at the commencement of Ms Duncan's employment. The Grievance Procedure was not part of the Contract when it was formed. 27 It is not pleaded that the Grievance Procedure became part of the Contract by way of an agreed variation. In any case, in its terms it does not apply to grievances between the Director herself and Lipscombe Child Care. Rather it provides for a procedure for settling grievances as between members of Staff, with the Director providing assistance as part of the grievance settling procedures. 28 There is no reasonable prospect of success in the claim made in pars 23, 24, 25 and 26. They will be struck out. For the reasons given above, pars 27 and 28 will be struck out. 31 The respondents submit that the conduct alleged was not in trade or commerce. In Concrete Constructions (NSW) Pty Ltd v Nelson [1990] HCA 17 ; (1990) 169 CLR 594 a worker was injured as a result of his foreman wrongly telling him that grates in an air-conditioning shaft were secured by bolts. He brought a s 52 claim based on misleading and deceptive conduct by the foreman, for which the employer was vicariously liable. In the view of the majority (Mason CJ, Dawson, Deane and Gaudron JJ) at 604-605, the foreman's statement was not made in the course of, or for the purposes of, some trading or commercial dealing between the corporation and the particular employee. The conduct of the foreman "consisted of an internal communication by one employee to another employee in the course of their ordinary activities in and about the construction of a building". 32 The application of the Concrete Constructions principle to conduct concerning contracts of employment has resulted in a divergence of Federal Court authority. In Barto v GPR Management Services Pty Ltd (1991) 33 FCR 389 Wilcox J held that information supplied to an employee in the course of negotiating a variation to his contract of employment was "in trade or commerce". In Stoelwinder v Southern Health Care Network (2000) 177 ALR 501, a case concerning negotiations for a new contract of employment, Finkelstein J came to the same view. Both these cases were strikeout applications and thus were governed at the time they were decided by the Dey and General Steel authorities; their Honours could only strike out the claim if it was hopeless or bound to fail. 33 In Martin v Tasmania Development and Resources (1999) 163 ALR 79, Mr Martin claimed that a letter stating that his termination was necessary on the basis of "operational requirements" was misleading and deceptive and contravened s 52. At the trial of the action I found that there were in fact "operational requirements" within the meaning of that term in the contract of employment: 163 ALR at [55]-[67]. Mr Martin succeeded on other grounds, not relevant for present purposes. However, I held that if the representations as to operational requirements were misleading and deceptive, they would not have been made in trade or commerce. It is true that a building company could not earn income unless it had workers who received instructions from foremen. But that was not enough to bring the alleged misrepresentation within the concept of 'trade or commerce'. Similarly, TDR could not carry out its activities of promoting Tasmanian trade and development (which activities themselves I assume for present purposes to be in trade or commerce) unless it engaged staff. Nevertheless such engagements and the necessary associated incidental negotiations, however necessary, are not in themselves of a trading or commercial nature. They are internal affairs of TDR. 34 Had this question arisen under the former strikeout standard, it would be very difficult to say this part of the case was hopeless, given the divergence of authority. However, s 31A is a clear, and different, command. I am still of the view that the application of Concrete Constructions in Martin was correct and that, accordingly, Ms Duncan has no reasonable prospect of success. Paragraphs 29, 30, 31 and 34 will be struck out. 37 In any event, unconscionable in s 51AA does not mean unfair or reprehensible in a colloquial sense. Rather, as explained in Australian Competition and Consumer Commission v C G Berbatis Holdings Pty Ltd [2003] HCA 18 ; (2003) 214 CLR 51 at [6] - [8] , [42]-[46], it refers to the equitable doctrine, the meaning of which has been expounded in High Court cases such as Blomley v Ryan [1954] HCA 79 ; (1956) 99 CLR 362 and Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 457. In the present case there is no complaint that the respondents exploited any special disadvantage of Ms Lipscombe in respect of the formation of the Contract and her engagement as Director. If the respondents' termination of the Contract amounted to a breach, the ordinary contractual remedies would be available. If the publication of the termination letter amounted to defamation, she will have, as she alleges, a good cause of action. 38 Paragraphs 32, 33 and 34 will be struck out. 40 But even if the federal claims are struck out, this Court will not be deprived of jurisdiction over the non-federal claims unless it can be shown that the former were "colourable", that is they were made for the improper purpose of fabricating jurisdiction: Burgundy Royale Investments Pty Ltd v Westpac Banking Corporation (1987) 18 FCR 212 at 219. This is a serious allegation. I did not understand it to have been put by the respondents. In any case, there is no basis for it. In particular, the s 52 claims would have appeared to have had some support from first instance judgements, at least in the light of the strikeout standard which applied when the proceeding was commenced. The respondents will have leave to file and serve an amended defence on or before 12 May 2006. The directions hearing is adjourned to 6 June 2006 at 9.30 am. The applicant is to pay the respondents' costs of the strikeout application. I certify that the preceding forty one (41) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey . | strikeout application whether s 31a federal court of australia act 1976 (cth) applies to proceedings commenced before operation of section termination of employment breach of contract claims whether subsequent grievance procedure formed part of contract of employment and applied to applicant whether statements made at time of termination made in trade or commerce whether unconscionable whether, if federal claims struck out, jurisdiction for defamation claim practice and procedure |
The persons named as applicant were William Webb, Bertram Williams, Margaret Culbong and Wendy Williams. The area of the application covers the extreme southwest corner of the State. Its boundary follows the low water mark from a point about 70 km to the west of Walpole, to Augusta, north through Dunsborough to a point a little south of Capel. The boundary then turns inland extending as far east as Bridgetown, Manjimup and Northcliffe. 2 The application was registered on 6 October 2006. 3 By amendments to the Native Title Act 1993 (Cth) (the NT Act) made in 2007 by the Native Title Amendment Act 2007 (Cth) a new s 94C was enacted. The new section defines circumstances in which applications, apparently made in response to future act notices given in relation to land or waters within the area covered by the application, are subject to dismissal by the Court. This circumstance arises where the procedural rights of the native title claimants in relation to the future acts have been exhausted and no steps are taken to advance the resolution of the application itself. 4 Notification to the Court of applications affected by s 94C is a function conferred on the Native Title Registrar by s 66C of the NT Act. 5 In this case the Native Title Registrar has notified the Registrar of the Court, by way of a report dated 29 June 2007, of five future act notices affecting areas covered by the present application. In relation to the first notice, which evidently concerned a mining lease, no s 31 agreement was lodged and the tenement was granted. The other four were evidently expedited procedure notices to which no objection had been taken. The report was basic and tabular in form. Before considering what the Court should do about it, it is helpful to set out the relevant provisions of ss 94C and 66C. (1E) Not relevant for present purposes. (2) the Court must not dismiss the application without first ensuring that the person is given a reasonable opportunity to present his or her case about why the application should not be dismissed. (3) The Court must not dismiss the application if there are compelling reasons not to do so. future act notice to which the current law applies means a future act notice to which the provisions in Subdivision P of Division 3 of Part 2 of this Act apply. The mechanism for summary dismissal is enlivened when, broadly speaking, the procedural rights are effectively exhausted and the native title determination application is not being pursued to a mediated or litigated determination. This broad characterisation of the effect of the provisions is subject to their precise language. The report of the Native Title Registrar under s 66C is a statutory means for drawing to the attention of the Court applications which may meet the conditions for dismissal under s 94C. 9 Section 66C(1) assumes that the matters of report are "facts". Again, that is a matter of fact. The Court must decide for itself that they exist before considering whether the application must be dismissed. In so doing it is not bound to act upon the advice of the Native Title Registrar. That advice to the Court's Registrar is not necessarily evidence. It is given no evidentiary standing by the NT Act. In the present case that made little difference because the relevant events as to the filing of the native title determination application, the issue of the s 29 notices and the outcomes thereof were not in dispute. Importantly the Court is not required to proceed to consider mandatory dismissal of a native title determination application even where the facts set out in the Native Title Registrar's report are undisputed or otherwise made out. 11 Where the Native Title Registrar provides an advice under s 66C and the Court finds the facts set out in his advice, consideration of mandatory dismissal does not follow automatically. Section 94C(1)(e) contemplates that the Court may require an applicant to produce evidence in support of the application or to take steps to have the claim resolved. Alternatively, the Court may consider whether the applicant has failed, within a reasonable time, to take steps to have the claim resolved. Any such judgment will require an assessment of whether the applicant has engaged with the mediation process for which the NT Act provides or has prepared or complied with directions for steps to be taken with a view to the trial of the action. The Court does not proceed to consider dismissal until there has been a failure to comply with its direction under s 94C(1)(e)(i) or there has been a failure to take steps within a reasonable time to have the claim resolved. 12 It will be seen that before it gets to the point of considering mandatory dismissal the Court has a degree of leeway under the section to move the applicants forward. The mandatory dismissal power, in effect, provides a tool or sanction to be used by the Court to dispose of applications lodged to get procedural rights and not otherwise being pursued. It covers a much greater area of land than the areas affected by those notices. The applicants are represented by the SWALSC which is working with the National Native Title Tribunal in the mediation process. The application takes its place in a regional timetable affecting claims in the southwest region. Having regard to the resources available to the applicants' representative body and the priorities for the region, this is not a case in which the Court considers that the applicants have failed, within a reasonable time, to take steps to have the claims in the application resolved. No direction pursuant to s 94C(1)(e) is necessary in the circumstances. 14 In the event that one or other of the conditions in s 94C(1)(e) were to be satisfied, then the question of mandatory dismissal may arise. It does not arise at the present time. The Court will therefore simply note the Native Title Registrar's advice. This is the procedure that I propose to follow in future when such advices are provided and the occasion for consideration of mandatory dismissal does not arise. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. | native title determination application application of mandatory dismissal provision lodgement of native title determination application following notification of proposed future acts exhaustion of procedural rights under right to negotiate provisions statutory report by native title registrar to federal court registrar function of report operation of mandatory dismissal provisions of s 94c power of court to give directions whether failure to take steps to have claim resolved large country claim area of claim much larger than areas covered by future act notices application part of regional work program no occasion for consideration of mandatory dismissal provisions native title |
2 She applied to the Department of Immigration and Citizenship for a Protection (Class XA) Visa on 12 September 2007. The basis upon which the application was made was that she claimed to be " a Falun Gong practitioner, and I have been persecuted in China by the Chinese government and local police ". That application was refused and she applied to the Refugee Review Tribunal on 28 December 2007 for review. 3 On 15 April 2008 the Tribunal published its reasons for decision to affirm the decision not to grant the visa. The Tribunal concluded ( inter alia ) that the now Appellant was not " a genuine and committed Falun Gong practitioner ". The Tribunal further concluded that " the applicant will not practise Falun Gong if she returns to China as she is not a committed or genuine practitioner; she has not practised in Australia since she has been here which is now nearly nine months since her arrival date ". An application was then filed with the Federal Magistrates Court for review by that Court. The application was dismissed and reasons for decision published on 25 September 2008: SZMJA v Minister for Immigration [2008] FMCA 1387. 4 The Appellant now appeals to this Court. She appeared before the Court yesterday unrepresented and with an interpreter. Refugee Review Tribunal has bias against me and didn't make fair decision for application. 2. I clarify all my points at the hearing of the Federal Magistrates Court, but the Judge didn't consider my application fairly. The Judge dismissed my application. 3. I believe that my application was not considered reasonably by the Judge at the Federal Magistrates Court. I lodged my application to be reviewed at Federal Magistrates Court. The Judge didn't consider all information provided at my hearing. 5 The appeal is to be dismissed. 6 Before the Federal Magistrates Court the " Grounds " for the application then being made were " jurisdictional error " and a denial of procedural fairness. I was sick and I couldn't attend hearing. No Ground was raised before the Federal Magistrate as to any alleged bias on the part of the Tribunal. 7 There are at least two reasons why the first Ground of Appeal raised in this Court should be rejected. First, it was not an argument raised before the Federal Magistrates Court and no reason has been advanced as to why leave should now be granted to entertain the argument. Second, it is well accepted that a " reasonable apprehension " of bias must be " firmly established ": Re JRL, Ex parte CJL [1986] HCA 39 ; (1986) 161 CLR 342. It needs to be said loudly and clearly that the ground of disqualification is a reasonable apprehension that the judicial officer will not decide the case impartially or without prejudice, rather than that he will decide the case adversely to one party. There may be many situations in which previous decisions of a judicial officer on issues of fact and law may generate an expectation that he is likely to decide issues in a particular case adversely to one of the parties. But this does not mean either that he will approach the issues in that case otherwise than with an impartial and unprejudiced mind in the sense in which that expression is used in the authorities or that his previous decisions provide an acceptable basis for inferring that there is a reasonable apprehension that he will approach the issues in this way. In cases of this kind, disqualification is only made out by showing that there is a reasonable apprehension of bias by reason of prejudgment and this must be "firmly established": Reg v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group [1969] HCA 10 ; [(1969) 122 CLR 546 at 553---4]; Watson [(1976) 136 CLR at 262]; Re Lusink; Ex parte Shaw [(1980) 32 ALR 47 at 50---1]. Although it is important that justice must be seen to be done, it is equally important that judicial officers discharge their duty to sit and do not, by acceding too readily to suggestions of appearance of bias, encourage parties to believe that by seeking the disqualification of a judge, they will have their case tried by someone thought to be more likely to decide the case in their favour. There is no basis upon which any " reasonable apprehension " of bias on the part of the Tribunal could be established. A review of the reasons for decision of the Tribunal does not establish anything other than the Tribunal reviewing the facts before it and the reasons for its decision. Where it is expedient in the interests of justice, a new argument may be allowed to be advanced on appeal which was not advanced at first instance: VUAX v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 158 at [46] . In the present proceeding, it is not expedient in the interests of the administration of justice to allow a new argument to be raised on appeal which has no prospects of success. 8 Nor is there any substance in the contention that the Federal Magistrates Court did not consider the application " fairly " or " reasonably ". 9 The reasons for decision as provided by the Federal Magistrates Court set forth, in summary form, the evidence as was before the Tribunal and then proceeded to deal with both of the " Grounds " being advanced for consideration. The Federal Magistrate did not perceive there to be any jurisdictional error. She actually attended two hearings. Exasperation may be felt when, as frequently happens in migration cases, arguments are advanced for resolution which appear to have little (if any) correlation with the facts in issue. Sometimes, a brief hearing will suffice. Judges may anticipate events at trial, and foresee lines of argument that may be developed. Here, the appellants made it clear from the outset that they hoped to be able to secure acquittal without giving evidence themselves. Perhaps the judge felt indignant about the conduct disclosed by the evidence, or about the tactics adopted by the appellants. Indignation is a natural reaction to some facts that are disclosed, or some events that occur, at a criminal trial or, for that matter, on an appeal. It should never be permitted to compromise the appearance of impartiality that is required of judges. In the context of the present appeal it may likewise be observed that moderation in the language with which reasons for decision are expressed may be more productive of adverse decisions being accepted as a balanced and impartial resolution of a dispute, especially disputes involving an unrepresented litigant. 10 There is nothing, however, which indicates that the Federal Magistrate in the present proceeding did not consider and " fairly " and " reasonably " resolve the arguments being advanced. Not only did the Federal Magistrate resolve the arguments being advanced by the now Appellant, he also considered a further argument potentially available to her based upon s 91R(3) of the Migration Act 1958 (Cth). This argument had properly been raised by those appearing for the Respondent Minister. 11 Other than the language used by the Federal Magistrate in his reasons for decision, there is thus no basis upon which any argument as to a lack of " fairness " could be advanced in the present appeal. That language, although it may have been more prudent for the observations to have been differently expressed, falls far short of establishing any reasonably held belief that the Federal Magistrate was not determining the case before him " fairly " and " reasonably ". There is no basis upon which it could be contended that the Federal Magistrate was not acting " impartially and without prejudice ". Each case must obviously be decided upon its own facts. But it may be noted that in Penhall-Jones v New South Wales [2007] FCA 925 a Federal Magistrate was not disqualified by reason of characterising an allegation that an offer had been made as a " bribe " as " ridiculous ". That and other " strong " language, Buchanan J concluded, did not demonstrate on the part of the Federal Magistrate " a lack of preparedness to deal with [the case] in a balanced way ": at [95]. The manner in which a judgment is expressed may evidence a reasonable apprehension of bias: Vakuata v Kelly [1989] HCA 44 ; (1989) 167 CLR 568 at 573. But the use of intemperate language, of itself, does not necessarily result in a decision being set aside: Klinger v Nicholl [2005] FCAFC 153 ; Naisauvou v Minister for Immigration and Multicultural Affairs [1999] FCA 86 at [32] , [1999] FCA 86 ; 89 FCR 435 at 443. 12 Although the Affidavit as filed in this Court refers indiscriminately to complaints made as against the Department, the Tribunal and the Federal Magistrates Court, it should be noted that the mere rejection of a claim by either the Tribunal or the Federal Magistrates Court self-evidently does not establish any reasonable apprehension of bias: cf SCAA v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 668 at [38] per von Doussa J. When referring to the reasons for decision of a Refugee Review Tribunal, His Honour there further relevantly observed that " it will be a rare and exceptional case where actual bias can be demonstrated solely from the published reasons for decision ". These observations have since been endorsed by Tamberlin, Mansfield and Jacobson JJ in SBBF v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCAFC 358 at [16] . See also: SZHOP v Minister for Immigration & Multicultural Affairs [2006] FCA 1640 at [23] ; SZLVN v Minister for Immigration & Citizenship [2008] FCA 1301 at [21] . 13 The lack of " fairness " on the part of the Federal Magistrates Court was explained by the now Appellant (through her interpreter) as being the fact that neither the Tribunal nor the Federal Magistrates Court believed that she was a genuine Falun Gong practitioner. The task of making findings of fact, including findings as to the credibility of the now Appellant, rested with the Tribunal. It is no part of the function of the Federal Magistrates Court or of this Court to review the factual findings as made. As was observed in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 at [25] , [2006] HCA 63 ; 228 CLR 152 at 160 " What is required by procedural fairness is a fair hearing, not a fair outcome ". The now Appellant was given a " fair hearing " before the Federal Magistrates Court. 14 No appellable error can be perceived in the reasons for decision of the Federal Magistrates Court. Those reasons do not expose anything other than a fair and impartial determination of the case being advanced. 15 The appeal is dismissed with costs. The Notice of Appeal as filed on 13 October 2008 is dismissed. 2. The Appellant is to pay the costs of the First Respondent. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Flick. | reasonable apprehension of bias reasons for decision need for moderation in language in reasons for decision migration |
That debt is in the sum of $500,000 and resulted from a consent order between Mr Cirillo and the four respondents in this matter. They are respectively Consolidated Press Property Pty Ltd ("CPP") (formerly known as Citicorp Australia Limited) ("CAL"), C.W. Construction Pty Ltd (Receivers & Managers Appointed) (in liquidation) ("CWC"), John Harold Heard and Stephen Elliot Young. 2 That costs order was in respect of proceedings initiated by Mr Cirillo against the four respondents on 4 April 1997. In my judgment in Cirillo v Consolidated Press Property Pty Ltd (formerly known as Citicorp Australia Limited) [2007] FCA 60 I set out a chronology at some length. I will not repeat it here other than to say that Mr Cirillo sought an inquiry as to damages in respect of an undertaking given when an injunction was awarded against him in 1985 restraining him from dealing with a particular piece of property described as "the Poclain". That injunction lapsed in February 1993 and the inquiry was sought in respect of that period. There were considerable interlocutory issues raised in that proceeding which, as I will later indicate, bear on the present matter. Suffice it to say that for present purposes in July 2000 a Master of the Supreme Court ordered the preliminary hearing of five issues from the apparently substantial number of issues that had arisen between the parties. Two of those issues were not prosecuted, the remaining three all were decided adversely to Mr Cirillo. A judge of the Supreme Court held, first, that he did not have standing to pursue his claim for relief in light of the events which had occurred; secondly, that he was not at any relevant time the legal or beneficial owner of the property in question nor did he have any right to possession of it; and, thirdly, he was estopped from asserting that he was a beneficial owner at any relevant time. His enquiry as to damages was dismissed. Mr Cirillo appealed unsuccessfully to the Full Court and a special leave application to the High Court was refused. The consent order founding the bankruptcy notice was made on 28 July 2005. Counsel for the applicant has not read much of the affidavit filed in support of that application. It would appear that what was foreshadowed in it was an action in tort for abuse of process against four respondents plus their then solicitors, Finlaysons. The nature of that abuse has been said to be similar to that contained in a subsequent Federal Court proceeding to which I will refer to below. 5 The set aside application was heard and reserved by a Registrar of the Federal Magistrates Court after a hearing over several days. Before the Registrar came to give judgment a further affidavit was filed by Mr Cirillo. Counsel for Mr Cirillo subsequently sought to have the hearing before the Registrar re-opened for the purpose of admitting that affidavit into evidence. By that stage Mr Cirillo had instituted proceedings in this court against the same five respondents. He purported to claim damages for breaches of duties of care he alleged were owed him by all respondents. While he characterised the conduct of the respondents as an abuse of process he did not plead that tort as such. The alleged wrongdoing of which complaint was made was concealment of an alleged agreement in 1997 by CAL in which it was supposed to have transferred secured debts owed to it by CWC to other corporate entities. The effect of this was said to be that CAL had in consequence not disclosed that it had no right to defend the inquiry as to damages proceedings at least on the basis that it had a set-off against Mr Cirillo's claims by virtue of its secured debt which was in turn supported by a personal guarantee by Mr Cirillo. Allied to this was a claim under the Trade Practices Act 1974 (Cth) against all of the respondents for damages for a contravention of s 52. 6 Prior to applying to have the bankruptcy notice set aside, Mr Cirillo had been advised not to seek to have the costs order set aside but rather to initiate Supreme Court proceedings of the type I mentioned above. This is of no little importance. 7 All five respondents in the above Federal Court proceedings sought to have the application struck out as vexatious or an abuse of process or to have it summarily dismissed on the basis that it had no reasonable prospects of success: see Federal Court of Australia Act 1976 (Cth), s 31A. The judgment of mine referred to above dismissed Mr Cirillo's application against all respondents with costs. The principal basis of my so doing was that, for as long as the Supreme Court costs order stood, the principal of finality embodied in the doctrine of res judicata precluded an examination of the incidents of costs albeit indirectly in a tort action such as foreshadowed in the then present statement of claim. That action was simply a collateral attack on the order. Additionally, I indicated I would not give leave to re-plead as the statement of claim that had been filed was truly embarrassing. 8 At the end of the hearing of that matter counsel for Mr Cirillo surrendered to the inevitable but did foreshadow his intention to initiate a further proceeding in the Supreme Court of South Australia. It had been the case that throughout that proceeding, as also in the proceeding before the Registrar in the Bankruptcy Act 1966 (Cth) proceedings, Mr Cirillo steadfastly refused to entertain the prospect of an application to set aside the costs order. He was to change his mind. 9 By a series of procedural moves, the bankruptcy notice application was removed to this Court and it was agreed that I should first hear the strike out application before I dealt with issues relating to the bankruptcy notice. It was anticipated that the fate of the bankruptcy notice would depend on the fate of the strike out application. If that was an expectation entertained by, amongst others, me, it was misplaced. When I handed down judgment in the strike out application I thought as a matter of fairness I should give Mr Cirillo a short opportunity in which to consider that judgment before proceeding to finalise the bankruptcy notice matter. Mr Cirillo in turn proceeded to file a fresh affidavit in the present matter which foreshadowed a new application to the Supreme Court of South Australia. That new application differs in quite considerable respects from the one that I had summarily dismissed. 10 The statement of claim, as best I understand it, seeks damages against CAL and Finlaysons on the basis of the tort of abuse of process. An estoppel claim in turn is raised against the other respondents such as would preclude them from seeking to enforce the July 2005 costs order. 11 The damages claimed were said to be costs associated with interlocutory applications and disputes in the inquiry as to damages proceedings which it is baldly asserted approximated $300,000 and costs of the trial time occupied in the preliminary hearing in so far as it considered the monies owing by CWC to CAL which the plaintiff estimates to exceed $200,000. The statement of claim earlier seeks exemplary damages. 12 Finally the statement of claim seeks an order setting aside the costs order of 28 July. Further, or alternatively and by reasons of the foregoing the consent of the plaintiff to the order described in paragraph 16 herein was obtained in circumstances where the defendants abused the process of the Court and withheld material facts which would have negated the consent of the plaintiff and resulted in an order in favour of the plaintiff had the true situation been known. 41(7) Where, before the expiration of the time fixed for compliance with the requirements of a bankruptcy notice, the debtor has applied to the Court for an order setting aside the bankruptcy notice on the ground that the debtor has such a counter-claim, set-off or cross demand as is referred to in paragraph 40(1)(g), and the Court has not, before the expiration of that time, determined whether it is satisfied that the debtor has such a counter-claim, set-off or cross demand, that time shall be deemed to have been extended, immediately before its expiration, until and including the day on which the Court determines whether it is so satisfied. It is sufficient for present purposes to note that it will have expired long since given that the present application itself has been on foot for over seven months. I also emphasise that the first intimation that has been given of an intent to institute proceedings to set aside the 2005 costs order is contained in the draft Statement of Claim appended to Mr Cirillo's affidavit of 9 February 2007 filed in this matter. 16 It is clear that Mr Cirillo does not fall within the provisions of s 41(6A)(a) insofar as concerns his foreshadowed claim. Under that provision the proceedings to set aside the relevant order had to have been instituted before the expiration of the time fixed for compliance with the bankruptcy notice. 17 Equally, it does not appear that any order extending time was made under s 41(6A)(b). Mr Cirillo's application seems to be founded solely upon s 41(7) of the Bankruptcy Act , his claim being that his tort action against the five respondents would satisfy the requirements of a counter-claim, set-off or cross demand for the purposes of that subsection. As I indicated in my judgment in the strike out proceedings, unless and until the costs order is set aside, it is simply not open to Mr Cirillo to make the claim he seeks to make founded on the tort of abuse of process claiming damages in respect of costs incurred in the inquiry as to damages proceeding. For this reason he cannot now point to an existing cross claim had by him that could be set-off against the costs order: Guss v Johnstone (2000) 171 ALR 598 at 607. 18 The present application properly characterised is a belated attempt to have time extended to institute proceedings to set aside the costs order rather than to set up a counter-claim, set-off or cross demand. This becomes immediately apparent once it is appreciated that if the costs order is set aside the judgment debt founding the bankruptcy notice would disappear. On this straightforward ground I would dismiss the application. 19 I would not, though, wish it to be thought that, even if this application could competently have been brought under s 41(7) , I would have the relevant level of satisfaction required to set aside the bankruptcy notice. 20 The foundation of Mr Cirillo's claim is that CAL disposed of its assets to third parties such that it no longer had any interest in the secured loan. In consequence, it is said it could not rely upon that debt or Mr Cirillo's personal guarantee of it by way of set-off in the inquiry as to damages proceedings. Mr Cirillo does not assert that either he or CWC had ever received any notice in writing that CWC's debt had been assigned and it would appear to be his positive case that he did not receive such notice. As is well known and well understood, a debt being a chose in action can only be assigned at law if the requirements of s 15 of the Law of Property Act 1936 (SA) are satisfied. Mr Cirillo appears to accept, although this is by no means clear, that CWC remained the legal owner of the chose. He then goes on to assert that, as the pleading indicates, using the debt as a basis for asserting the set-off was abusive because it was done for an improper collateral purpose. Mr Cirillo simply has not countenanced the possibility that this set-off may in fact have been either validly raised by way of defence or else raised mistakenly but in good faith. I have been asked to infer that there was a reasonable probability that that collateral purpose was there. 21 I should interpolate that CAL/CPP denies that there was an assignment in any event but goes on to assert that, if there had been, it would only have been effective in equity, hence as legal owner it could properly raise a defence of set off in the 1997 proceedings. 22 Mr Cirillo's counsel has not been able to point me to one item of evidence which would point towards the improper purpose alleged. I simply am asked to draw the conclusion proposed because Mr Cirillo believes he has suffered grave injustice at the hands of the respondents. 23 It is well accepted that in proceedings under s 41(7) the affidavit material in support of an application must do more than merely assert the existence of a counter-claim etc. It must contain evidence which establishes that there is an effective and bona fide claim which is real. Mr Cirillo's belief, no matter how strongly and earnestly held, is not a substitute for such evidence. On this ground alone I would have dismissed the application under s 41(7) , if it was in fact competent. 24 I equally should indicate that I have no material before me which could lead to the requisite satisfaction that the counter-claim etc on which Mr Cirillo intends to rely would, if quantified, be in a sum equal to or in excess of the amount of the costs order. There are simply bald assertions of sums of costs incurred by Mr Cirillo both in interlocutory proceedings and in the preliminary hearing. These are not the subject of any evidence that could satisfy me that he has any reasonable probability of recovery of such sums in his foreshadowed proceedings: see Patone v Asteron Ltd (formerly Royal and Sun Alliance Financial Services Ltd) (ACN 001 698 228) [2004] FCA 232 at [74] - [75] . 25 As to the alleged loss he incurred in unsuccessfully prosecuting the preliminary hearing it is difficult to see how this could be said to represent a recoverable loss in any event. 26 I have concluded that the present application is an incompetent one. Mr Cirillo cannot engage the power to extend time conferred by s 41(6A) of the Bankruptcy Act insofar as he wishes so to do for the purposes of instituting proceedings to set aside the 2005 costs order of the Supreme Court of South Australia. Nor are the circumstances ones in which he can have the bankruptcy notice itself set aside under s 41(7) of the Bankruptcy Act . Accordingly, I will order that the application be dismissed and I order the applicant to pay the respondents' costs of the application. I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn J. | proceedings to set aside bankruptcy notice under s 41(7) of the bankruptcy act 1966 (cth) notice founded on consent orders for costs alleged set-off or counter-claim summarily dismissed in parallel proceedings fresh set-off or counter-claim proposed need first to have consent order for costs set aside assertion of counter-claim or set-off unsupported by evidence assertion that cross claim or set-off is equal to or exceeds the amount of the judgment debt unsupported by evidence bankruptcy bankruptcy |
Leave was necessary because the judgment appealed from was interlocutory: s 24(1A) Federal Court of Australia Act 1976 (Cth) ('the FCA Act'). Prior to the hearing on 20 May 2008, Spender ACJ made a determination pursuant to s 25(1A) of the FCA Act that it was appropriate for the appellate jurisdiction of the Court in relation to the appeal to be exercised by a single judge. Accordingly, on granting the appellant leave to appeal, I immediately proceeded to hear the appeal. 2 In the judgment below, his Honour ordered the amendment of Bankruptcy Notice No. NN 2759 of 2007 ('the Bankruptcy Notice') pursuant to an interim application filed on 15 January 2008 by the respondent. The amendments included the reduction of the amount claimed in the Bankruptcy Notice from $2,176,026.95 to $1,084,614.46 because of amounts received by the respondent prior to the issue of the Bankruptcy Notice that reduced the amount owing by the appellant to the respondent. By reason of s 95 of the Supreme Court Act 1970 (NSW) and, from 15 August 2005, s 101 of the Civil Procedure Act 2005 (NSW), interest accrued on the Supreme Court Judgment pursuant to the rate prescribed from time to time. By reason of clause 10(b) of Schedule 6 of the Civil Procedure Act , all the interest is taken to have accrued under s 101 of that Act. 6 On 3 October 2007, the Federal Magistrates Court made an order for substituted service of the Bankruptcy Notice. 7 On 16 November 2007, the appellant filed an application ('the Application to set aside') to commence proceeding number SYG 3568 of 2007 in the Federal Magistrates Court. It sought an order setting aside the Bankruptcy Notice and costs on the grounds set out in the affidavit of the appellant. The appellant's affidavit stated that her grounds were that only a copy of the Bankruptcy Notice `had been served on her and that she was seeking to set aside the Supreme Court Judgment in current proceedings. The Federal Magistrates Court extended time for compliance with the Bankruptcy Notice up to and including 27 November 2007. 8 On or about 21 November 2007, the appellant served a notice ('the s 41(5) Notice') pursuant to s 41(5) of the Bankruptcy Act 1966 (Cth) ('the Act') alleging that the Bankruptcy Notice contained an overstatement of the amount in fact due owing to the failure of the respondent to give credit for amounts received. 9 The s 41(5) Notice also foreshadowed an amendment to the Application to set aside to add overstatement as a ground as to why the Bankruptcy Notice should be set aside. 10 On 27 November 2007, the Application to set aside came before the Federal Magistrates Court for directions. The Court granted the appellant leave to amend the Application to set aside, made directions concerning the filing and service of an interim application by the respondent, as well as affidavits in support and reply, and further extended time for compliance with the Bankruptcy Notice to 22 January 2008. 11 On 4 December 2007, the appellant filed an amended application ('the Amended Application to set aside') that sought the same relief as the Application on the same grounds and added 'overclaim' as a further ground. 12 On 15 January 2008, the respondent filed an interim application for orders that the Bankruptcy Notice be amended ('the Interim Application'). 13 On 22 January 2008, the matter came before the learned Federal Magistrate. His Honour heard the Interim Application and reserved judgment. Although his Honour was of the view that if the amendments were not allowed, the Bankruptcy Notice would be set aside because of the overstatement (see [3] of the judgment below), his Honour did not hear the Amended Application to set aside. 14 On 8 February 2008, his Honour delivered judgment on the Interim Application from which this appeal is brought. Which of the two positions does the court act upon? It seems to me that the argument about service was highly technical at best. The applicant debtor received the notices and became aware of their import. She was at all times advised by a solicitor. I have little doubt that a court of bankruptcy applying the law as laid down by the High Court in Adams v Lambert [2006] HCA 10 ; (2006) 228 CLR 409 would apply s.306 of the Act or rule 1.06 of the Federal Magistrates Court Rules 2001 and decline to hold the bankruptcy notice invalid for this reason. In those circumstances and given the service of the notice under s.41(5) the action of the applicant in withdrawing the service ground was appropriate and the matter should proceed as if substituted service was effected. 16 At [7] of his reasons, his Honour observed that there was no issue that the s 41(5) Notice did not meet the requirements of s 41(5), cf., Seovic Civil Engineering Pty Ltd v Groeneveld [1999] FCA 255 ; (1999) 87 FCR 120 at [36] , and then proceeded to deal with the crux of the appeal to this Court, namely, whether the Act allows amendment of a 'bankruptcy notice' in respect of which a s 41(5) notice has been given. Clearly, a recipient can do this. This means that a declaration of invalidity is something to be done by the court. Why, then, is it not possible for the giver of a notice [a bankruptcy notice] to request the court to allow an amendment thereof before the court has made the declaration? Provided there is no other detriment to the applicant debtor by, for example, giving him a further period of 21 days to comply with the notice, I cannot see that anything would stand in the way of granting leave. In this particular paragraph, his Honour made no reference to s 33(1)(b) of the Act (although he had earlier at [6] of his reasons) but proceeded on the basis that a s 41(5) notice did not work any invalidity on a bankruptcy notice until a court declared it to be so, and prior to that the bankruptcy notice could be amended to cure the over-claim the subject of a s 41(5) notice. I shall return to his Honour's reasoning process below. A4 failing to hold that the "amendment" is not within the Court's jurisdiction because it is in reality an assumption of jurisdiction that the legislation does not allow --- ie the Court cannot hold something made essential by the Act, leading to invalidity of the Bankruptcy Notice) to be inessential. ( Kleinwort Benson. Grounds A7 and A8 were not pressed on the hearing of the appeal and can be put to one side. It is the issue of a bankruptcy notice which is a proceeding under the Act: Pillai v Comptroller of Income Tax [1970] AC 1124 at 1131; quoted with approval in Kleinwort Benson Australia Ltd v Crowl [1988] HCA 34 ; (1988) 165 CLR 71 at 77 per Mason CJ, Wilson, Brennan and Gaudron JJ. That history is, at the least, consistent with the views we have expressed and, on balance, supports the conclusion we have expressed. [42] The antecedents of s 41(5) of the Bankruptcy Act are to be found in s 16(2) of the Bankruptcy and Deeds of Arrangement Act 1913 (UK) (the 1913 Act). This subsection provided that a bankruptcy notice issued in respect of a judgment debt under s 4(1)(g) of the Bankruptcy Act 1883 (UK) (the predecessor of s 40(1)(g) of the Bankruptcy Act) was not to be invalidated in certain circumstances. In Re a Debtor, the bankruptcy notice, which claimed payment of [sterling]984 7s 1d, overstated the interest component by [sterling]1 5s 4d. Cozens-Hardy MR rejected (at 687) the proposition that the overstatement was a mere "formal defect" that fell within s 143(1) of the Bankruptcy Act 1883 (UK) (the forerunner of s 306(1) of the Bankruptcy Act). In his view, to claim payment of a sum that was never due was a substantial defect, regardless of the precise amount of the mistake. Farwell LJ expressed a similar opinion, observing that the statute had to be "strictly followed". The expression used --- "the sum specified in the notice as the amount due exceeds the amount actually due" -- was apt to cover any factual situation which produced an overstatement of the amount due. [45] Section 16(2) of the 1913 Act was reproduced as proviso (ii) to s 2(1) of the Bankruptcy Act 1914 (UK). It was, in turn, adopted as proviso (ii) to s 53 of the 1924 Act referred to earlier. Section 53 of the 1924 Act stated that a bankruptcy notice was to be in the prescribed form and was to require the debtor to pay the judgment debt or the sum ordered to be paid in accordance with the terms of the judgment or order. In Re Prossimo, Clyne J described (at 89) proviso (ii) as in part creating an exception to the general rule that the bankruptcy notice should require the debtor to pay the judgment debt according to the terms of the judgment. The reference to the "amount actually due" in proviso (ii) was intended to qualify the general rule and to require the bankruptcy notice to state the actual amount due. The second part of the proviso was intended to prevent, under certain conditions, a bankruptcy notice being invalid by reason of an overstatement of the amount actually due. But where the bankruptcy notice overstated the amount actually due and the debtor gave a notice in accordance with the proviso, the bankruptcy notice was invalid. In other words, the law as stated in Re a Debtor did not apply unless the debtor gave the creditor a notice complying with proviso (ii) to s 53 of the 1924 Act. [46] Section 41(5) of the Bankruptcy Act follows the form recommended by the Report of the Committee Appointed by the Attorney-General of the Commonwealth to Review the Bankruptcy Law of the Commonwealth (1962), chaired by Clyne J and including among its members the Commonwealth Parliamentary Draftsman (Mr J Q Ewens). The provisions contained in section 53 dealing with the form, contents and service of a bankruptcy notice are considered by the Committee to be generally satisfactory, although the Committee believes that the precise requirements as to such a notice will appear more clearly from the redraft of that section contained in the Bill. [47] Section 41(5) of the Bankruptcy Act incorporates the drafting changes suggested by the Clyne Committee and differs from the first part of proviso (ii) to s 53 in several respects. However, s 41(2) of the Bankruptcy Act , as originally enacted, was similar to the first part of s 53 of the 1924 Act to which par (ii) was a proviso. (Section 41(2), in its original form, was repealed in 1996 and replaced with a provision which merely requires the bankruptcy notice to be in accordance with the prescribed form). • The subsection uses the expression "the amount in fact due" to replace "the amount actually due" in proviso (ii). • The expression "the misstatement" is substituted for the phrase "such misstatement", which was used in proviso (ii). There is nothing to indicate that the Clyne Committee intended that the substitution of the definite article for the word "such" in the concluding phrase should bring about any change in the scope and application of s 41(5) compared with its predecessor. We of course appreciate that Clyne J had expressed the view in Re Charles Murray that a debtor's notice under proviso (ii) to s 53 of the 1924 Act did not have to set out the amount of the excess. It may be that his Honour intended to say no more than that a debtor's notice may be capable of complying with the proviso even if it does not specify precisely the excess improperly claimed in the bankruptcy notice. If Clyne J meant to go further, in our respectful opinion, the language of the proviso and of s 41(5) does not warrant such a step being taken. The general comments in par 69 of the Clyne Committee Report cannot be read as a specific endorsement of the decision in Re Charles Murray. In Re Walsh [(1982) 47 ALR 751] , Lockhart J challenged this assumption, by holding that under the Bankruptcy Act, an over-statement of the amount due by the debtor does not necessarily vitiate the bankruptcy notice. His Honour considered ... that the bankruptcy notice would be avoided only if the over-statement could reasonably mislead the debtor. He said he would decline to follow Re a Debtor and Re Prossimo if they stood in the way of this conclusion. [50] In Re Greenhill; Ex parte Myer (NSW) Ltd (1984) 5 FCR 84 , Morling J declined to follow Re Walsh and held that an over-statement in a bankruptcy of the amount actually due renders the notice invalid, whether or not the over-statement could reasonably mislead the debtor. Morling J considered that observations by the High Court in Walsh v Deputy Commissioner of Taxation [1984] HCA 33 ; [(1984) 156 CLR 337] ... were inconsistent with Lockhart J's analysis. A similar view was subsequently taken by Pincus J in Re Emerson; Ex parte Wreckair Pty Ltd (1991) 101 ALR 315 at 318-319 (affirmed on other grounds: Emerson v Wreckair Pty Ltd [1992] FCA 16 ; (1992) 33 FCR 581 (FC)). [51] We have acted on the assumption, not challenged by either party, that Re Greenhill and Re Emerson correctly state the law. However, our view would not be changed if Lockhart J's decision in Re Walsh were ultimately found to be correct (as to which we express no view). 23 As indicated at [51] of its reasons in Seovic , the Full Court was prepared to act on the assumption that Re Greenhill and Re Emerson correctly state the law, that is, that an overstatement in a bankruptcy notice of the amount in fact due renders the notice invalid, whether or not the overstatement could reasonably mislead the debtor, if a notice complying with the requirements of s 41(5) has been duly given. I am prepared to proceed on the same assumption. with whom Mason, Brennan, Deane and Dawson JJ agreed. 25 It is important, in my view, that the section uses the word 'unless' and not 'until'. In other words, invalidity of the bankruptcy notice does not only run from the time of the giving of the s 41(5) notice; once a s 41(5) notice is given, invalidity is visited upon the bankruptcy notice from the time of its issue. 26 Of course the foregoing assumes that the notice given by the debtor complies with the requirements of s 41(5) , cf., Seovic 87 FCR, and that the debtor's notice cannot be challenged on some other ground such as that the bankruptcy notice does not overstate the amount actually due. It would be open to a creditor, in an appropriate case, to challenge a purported s 41(5) notice on either basis, but there is no foundation for a challenge on either basis in the present case. 27 It follows from the foregoing, that I am unable, with respect, to agree with his Honour's reasoning at [7] of his reasons extracted at [16] above. First, his Honour's premise that the mere giving of notice under s 41(5) cannot invalidate a bankruptcy notice without more could only be correct where there is no overstatement in the bankruptcy notice. They are not the facts here. Second, his reason for coming to that conclusion --- because that would not allow for a situation in which the recipient of the notice could challenge the alleged overstatement --- does not provide any support because it would always be open to the creditor, in an appropriate case, to challenge a purported s 41(5) notice on either of the bases referred to in [26] above. Third, the invalidity of a bankruptcy notice that has its source of invalidity in its overstatement of the amount in fact due and the timely giving by the debtor to the creditor of a notice that complies with the requirements of s 41(5) is not dependant upon some declaration by a court. In these circumstances, declaration of invalidity by a court is merely declaratory of the operation of the Act to those facts. If the overstatement is due to clerical error and is one that could not reasonably mislead the debtor, then it may not even be necessary to rely on s 33(1)(b) at all; s 306(1) of the Act may, in those circumstances, save the proceeding. The more difficult question is whether a court is empowered, in reliance on s 33(1)(b) of the Act, to amend a bankruptcy notice once it has been visited with invalidity in the circumstances of the present case. 29 The respondent submitted that even if a bankruptcy notice is invalid by reason of an overstatement of the amount due to the creditor and the timely giving by the debtor to the creditor of a notice complying with the requirements of s 41(5), the most that this does is make failure to comply with it a non-event or, to use the words of Deane J in Kleinwort Benson 165 CLR at 81 '... failure to comply with it does not constitute an act of bankruptcy'. In the respondent's submission, s 33(1)(b) of the Act nevertheless empowers the court to 'cure' the invalidity by amending the notice so that the amount referred to therein corresponds with the amount due to the creditor. 31 I have already dealt with the third argument at [27] above and I reject it. 32 The first and second arguments can be conveniently dealt with together. Section 33(1)(b) refers to a 'notice under this Act'. An invalid bankruptcy notice is a nullity and of no effect. In such cases the notice is a nullity whether or not the debtor in fact is misled: In re A Judgment Debtor, 530 of 1908 [[1908] 2 KB 474 at 481]. It is important that a bankruptcy notice be prepared with great care. The courts require strict compliance with the Act and Regulations. The reason for this is that a bankruptcy notice sets in train the entire process leading to bankruptcy, a process that has been described as 'quasi-penal'. [37] Formal errors in a bankruptcy notice do not result in its invalidity unless they have caused substantial injustice. However, substantive errors will generally lead to the notice being regarded as invalid and of no effect. If a bankruptcy notice is invalid, any bankruptcy proceedings based upon that notice will be dismissed. 35 If a bankruptcy notice is a nullity and of no effect, it is not a notice under the Act: see Circle Credit Co-Op Ltd v Lilikakis [2000] FCA 667 ; (2000) 99 FCR 592 at [10] per Heerey J; Chandramouli v Wallader [2001] FCA 808 at [4] . It must be a notice under the Act to be subject to the court's power of amendment in s 33(1)(b). 36 In short, I am of the view that the learned Federal Magistrate had no power to cure the invalidity of the Bankruptcy Notice by amendment in reliance on s 33(1)(b) of the Act and that the Bankruptcy Notice should have been set aside. 37 The appellant's success on this aspect of her appeal makes it unnecessary to address Ground A6 of the Notice of Appeal: see [18] above. 38 On the hearing of the appeal, I gave the respondent leave to file an Amended Notice of Contention dated 27 June 2008 setting out three grounds on which the respondent contended that the judgment of the Federal Magistrates Court should be affirmed, said to be grounds other than those relied upon in the proceedings below. Ground 2, however, essentially encompassed the crux of the appellant's appeal to this Court. Ground 3 covered ground common to Ground A6 of the appellant's Notice of Appeal and, as indicated in [37] above, need not be addressed. 39 Ground 1 of the respondent's Amended Notice of Contention sought to agitate the issue of service of the Bankruptcy Notice, but no argument was addressed to me on this issue. Certainly no error was identified in the Federal Magistrates reasons for concluding that the matter should proceed as if substituted service of the Bankruptcy Notice was effected. In the circumstances, the ground cannot be sustained. 40 The appellant's appeal must be allowed. The respondent must pay the appellant's costs of the appeal and of the hearing of the respondent's Interim Application in the Federal Magistrates Court. I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds. | notice disputing validity of bankruptcy notice for overstatement of judgment debt under s 41(5) of the bankruptcy act 1966 (cth) the operation of s 41(5) whether an overstatement in a bankruptcy notice renders the notice invalid from the time of its issue if the requirements of s 41(5) are satisfied notice under this act whether a court has the power to amend a bankruptcy notice under s 33(1)(b) once it is invalid bankruptcy |
2 The applicant first applied for a Protection Class (XA) visa on 26 February 2003. After a decision by a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs ('the Minister') the Refugee Review Tribunal ('RRT') found the application was not valid because certain details had not been provided in the application. An application for judicial review to the Federal Magistrates Court and a subsequent appeal to this Court were dismissed. However, as the original application was invalid, there was (as Edmonds J remarked in his judgment of 23 May 2005) no barrier to a further application for a protection visa. 3 The applicant made a further application for a protection visa on 23 June 2005. 4 The grounds for this application were a combination of two main factors. The applicant, a citizen of India, who lived in Kerala, said he had fallen in love with a Muslim woman. As he was Hindu the woman's father was opposed to the relationship, threatened him and at one stage he was beaten. During the course of these events he had been inveigled into innocently participating in a bank fraud, had been arrested, jailed and released on bail thanks to the intervention of his father. A friend remained in jail. The friend's family was harassing him. 5 These matters are an unpromising foundation for the grant of a protection visa. The delegate was not persuaded, even taking the applicant's claims at face value, that they raised a meritorious claim that the applicant was a person to whom Australia has protection obligations under the Refugees Convention. 6 On 11 August 2005, the delegate refused to grant a protection visa. 7 The applicant sought review by the RRT. He was invited to, and did, give oral evidence on 9 November 2005. The RRT decision contains a detailed analysis of the applicant's claims. The RRT raised issues with the applicant concerning whether his assertions, even if accepted, provided a satisfactory foundation for his claim to be a refugee. After considering his responses it was not satisfied he was a refugee. On 10 November 2005 it confirmed the decision not to grant a protection visa. 8 The applicant lodged an application for judicial review. The Tribunal relied in its decision on relevant background material, which it described in its decision. The tribunal did not discuss this material with the applicant and give him an opportunity to comment giving rise to jurisdictional error. The Tribunal said the CPM party is just one opposition party in Kerala they have only 23 seat of 140 assembly seats in Kerala, but now presently have assembly election in Kerala, all south 7 district election is done, other state will going to polling next week, the exist poll and intelligence report saying CPM will come back more power as 103 assembly seats, its more critical. The Tribunal failed to consider the possibility that the applicant, following his return to India, would locate his mother and girl friend, resume the relationship and be exposed to persecution. As a result, the Tribunal ignored or field [sic] to consider an aspect of the applicant's claim, giving rise to jurisdictional error. 10 The second ground was rejected as a challenge to a factual finding rather than a jurisdictional issue. In any event it is speculative. Scarlett FM was correct to reject it. 11 As to the third ground, when asked about the woman with whom he had sought to establish a relationship, the applicant informed the RRT that he had not seen her for five years and did not know where she was. There is no indication from the very comprehensive account of the hearing in the decision of the RRT that the applicant raised any possibility of the kind referred to in ground 3. I do not see, in any event, how it could help his application for a protection visa. It raises no jurisdictional issue bearing upon the application for judicial review. 12 The appeal to this Court made general allegations that Scarlett FM had erred in not finding jurisdictional error and procedural fairness. 13 At the hearing I invited the applicant on three occasions to make submissions in support of the appeal but he indicated that he had nothing to add to the material already before the court. 14 No error in the decision of Scarlett FM has been shown or, to my mind, appears from the papers. In my view his Honour had no alternative but to dismiss the application for judicial review which was before him and this Court must dismiss the appeal from his decision. 15 The appeal will be dismissed with costs. 16 At the conclusion of the hearing Mr Chami, appearing for the respondent, asked me, if I dismissed the appeal, to make a costs order fixed in an amount of $3,000. I enquired about the evidentiary foundation for such an assessment. Mr Chami referred me to the Federal Court Rules O 62 r 4(2)(c) which permits the Court to order costs fixed at a gross sum. He offered to provide an affidavit at a later date in support of the claim for costs. Reference was also made to Schedule 1 of the Federal Magistrates Court Rules 2001 which provides, amongst other things, for costs up to $5,000 for a migration proceeding which is concluded at a final hearing. In the absence of a scale of fees and in the absence of agreement I am not prepared to order costs in a fixed amount. The assessment of costs can be dealt with in the ordinary way. There is nothing to be gained by my taking evidence independently about the matter. 20 In the circumstances I will order that the applicant pay the respondent's costs but I decline to specify the amount of those costs. I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan. | appeal dismissed costs as a gross amount sought but not ordered. migration |
By that decision, the AAT concluded that the late Samantha Underdown was 'a member of a couple' with the second applicant, Mr Arturo Fazio (Mr Fazio) for the purposes of s 4(2)(b) of the Social Security Act 1991 (Cth) (SSA) in the period of 24 December 1999 to 23 January 2000 (the relevant period). The financial consequence of that conclusion was that there had been an overpayment of benefits to Ms Samantha Underdown (Ms Underdown) (almost 10 years ago) of some $70.86. The apparent emotional impact on Mr Fazio of dealings with Centrelink appears to have been extremely significant. How such a financially insignificant matter escalated in the fashion it has over many years remains a mystery as well as a tragedy. Those departments are determined by reference to the Commonwealth Government's Administrative Arrangement Orders (AAO). The relevant policy department in the present appeal is the Department of Education, Employment and Workplace Relations (the Department). On 24 December 1999, Ms Underdown applied for and was granted a Newstart allowance. She was paid it from that date until January 2000 on the rate applicable to a single person. In late January 2000, her Newstart allowance was cancelled as she had secured fulltime employment. Three years later, on 17 April 2003, a Centrelink officer decided that Ms Underdown had been living in a marriage-like relationship with Mr Fazio (then known as Mr Arthur Heedes) since 7 June 1991. The Centrelink officer also decided that Ms Underdown had been overpaid $70.86 in Newstart allowance between 24 December 1999 and 22 January 2000 as she was paid at the single rate rather than the lower rate for a partnered person. Ms Underdown requested a review of the decision. The decision was internally confirmed and Ms Underdown appealed to the Social Securities Appeals Tribunal (SSAT). The SSAT, on 31 May 2007, also affirmed the decisions and on 26 June 2007, Mr Fazio filed an application with the AAT for a review of Centrelink's decisions on behalf of Ms Underdown. Sadly, Ms Underdown passed away on 1 July 2007. In the AAT, various preliminary events and hearings took place and on 8 February 2008, the AAT directed that Mr Fazio be joined as a party to the application for review and the matter be listed for a conference as early as possible. Mr Fazio did not attend the hearing of the appeal. He informed the AAT by facsimile on the morning of the appeal that he was 'mentally unable' to do so. There were also two other facsimiles from him shortly prior to the hearing dates. The AAT nevertheless proceeded with the appeal noting that Mr Fazio had previously been given proper notice of the hearing, that he did not request an adjournment of the hearing and that it was 'implicit in his aforementioned facsimiles that he was thereby providing information and making submissions to the Tribunal which he wished the Tribunal to take into account for the purpose of making its decision following the hearing'. The main point in this 'appeal' is the AAT's decision to proceed without hearing Mr Fazio orally. The AAT did have on the other hand, hundreds of pages of material from previous hearings, submissions and communications from Mr Fazio all in relation to the issue of whether or not, by reason of her relationship, Centrelink had overpaid Ms Underdown $70.86. The AAT (on 27 August 2008) affirmed the decision of the SSAT of 31 May 2007. The AAT concluded that the longstanding duration of the relationship immediately prior to the relevant period, their residing together on a continuous basis immediately before, during and immediately after the relevant period, and the apparently high level of commitment, including the provision of substantial companionship and emotional support to each other over the relevant period, pointed to the existence of a marriage-like relationship between them from at least 1995 including for the whole of the relevant period. The AAT formed the view that the relationship between Ms Underdown and Mr Fazio was a marriage-like relationship within the meaning of s 4(2)(b)(iii) SSA for the whole of the relevant period and that Ms Underdown was therefore a 'member of a couple' for the purposes of the SSA. Accordingly, the AAT concluded that Ms Underdown had received an overpayment of Newstart allowance in the relevant period in the amount of $70.86 and that sum was a debt due to the Commonwealth. On 21 October 2008, the Court ordered that the applicants file an amended notice of appeal and requested that Mr Fazio file an affidavit setting out the basis on which he claimed to be entitled to represent the estate of Ms Underdown in the proceeding. The affidavit was duly filed. The respondent (the Secretary), on 19 January 2009, filed a notice of motion for dismissal of the appeal pursuant to s 31A of the Federal Court of Australia 1976 (Cth) (FCA). Much, but by no means all, of the argument and evidence advanced by Mr Fazio goes to the merits or the factual inquiry conducted by the AAT. These reasons touch on that material but the nature of the task for this Court is primarily directed to consideration of the errors of law for which Mr Fazio contends. In the affidavit sworn by Mr Fazio and filed in support of his appeal, he stresses the following matters: ... I was not only mentally and physically tormented but, wanting to curl up and die over having to relive my nightmares. I believe it was wrong of the AAT not to consider my condition at the time of the hearing and not to offer me the option of a telephone hook up, for which they had prior notice of my non attendance and for which I could have accommodated, in line with Bourke v Companies Auditors . This denied me the fair opportunity to put our side of the story forward and challenge the prejudicial and inadmissible evidence submitted. The AAT refused to respond to my question of 26 August 2008 the day before the hearing or contact me prior to such. These appeal proceedings as couched, are merely an extension of a sequential statutory appeal process which commenced way before Samantha passed away, and as such have not come to an end, hence I believe it is wrong to say this appeal which is by way of mandatory process, was started after Samantha's death. In this regard he refused to admit evidence I wanted to submit to show that as at the 12 th December 2003, Samantha and I were not in a marriage like relationship and that I was single. Herein enclosed as annexure AF6 is a true copy of such. Annexure AF6 is a Western Australian Police Department antecedent report dated 12 December 2003 in which a police officer has recorded that Mr Fazio (then named Arthur Heedes) was single, had not been married, did not have a spouse, did not live with a family and did not maintain a family. I believe that it was wrong at law for the AAT not to at least have ALL the documents before the SSAT in making their decision, which included an extremely important affidavit from Samantha that in effect, proved to be her dying words on the matter. In any event, I believe a reasonable and fair juxtaposition of the evidence that was before the AAT would not lead to the bald decision of the AAT as reflected in the written reasons for decision. I mistakenly relied on the DEFICIENT notice of the AAT addressed to Samantha dated the day after Samanthas passing at page 102, in that all documents before the SSAT were being supplied by Centrelink, not just lawfully inadmissible, irrelevant and prejudicial material. I also find it difficult to understand against that background, how the respondent now asserts that I have no interest in the matter, especially when approximately half of the 478 pages of Tdocs, relate to or state me personally, and not Samantha. Furthermore, I believe the position contained at paragraph 22 of the respondents' submissions in this motion, to be disingenuous at best in light of what was contained in the Tdocs about my social security benefit entitlements. Mr Fazio has also filed a document entitled 'Outline of unfinished submissions of applicants in objection to respondent notice of motion'. A degree of latitude has been afforded to Mr Fazio who is unrepresented. The first version of that document was filed five months ago but the version recently filed appears to mirror it. No additional documents have been filed and no extension of time sought for filing of submissions in response to those of the respondent. There have been numerous decisions dealing with the proper approach on a motion of this nature. The second reading speech of the Migration Litigation Reform Bill 2005 which introduced s 31A stated that its purpose was to strengthen "the power of the courts to deal with unmeritorious matters by broadening the grounds on which federal courts can summarily dispose of unsustainable cases": Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352 ; (2006) 70 IPR 146 at [45] ; Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd [2008] FCAFC 60 at [124] . See Genovese v BGC Construction Pty Ltd [2007] FCA 923 at [5] ; Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352 ; (2006) 70 IPR 146 at [42] - [48] ; Hicks v Ruddock [2007] FCA 299 ; (2007) 156 FCR 574 at [13] ; Bond v Barry (2007) 73 IPR 490 at [46]; Commonwealth Bank of Australia v ACN 000 247 601 Pty Ltd (in Liq) (formerly Stanley Thompson Valuers Pty Ltd) [2006] FCA 1416 at [30] ; Fortron Automotive Treatments Pty Ltd v Jones (No 2) [2006] FCA 1401 at [21] ; Jefferson Ford Pty Ltd v Ford Motor Company of Australia Limited [2008] FCAFC 60. The submissions for Mr Fazio rightly focus significantly on the caution with which summary judgment should be approached. In this regard, a summary of his submissions on the appeal points are set out as follows: The AAT failed to properly consider or even consider at all, the pivotal SSAT decision number P21567 of 14 February 2002 relating to rent allowance entitlements of me the second applicant in this matter dating back to 4 January 2000, and, the relevant legislation pertaining to said decision making process and decision that I was not in a marriage like relationship with Samantha at the material time, which impacts on this the appealed matter regarding Samantha. Centrelink's ultimate acceptance and enacting of the SSAT decision number P21567 back in 2002 and their failure to appeal the decision, thus leaving it on record. The AAT failed to properly consider or even consider at all, the significant reasons and the exceptional circumstances in a law context, behind the applicant's non attendance at the precipitous SSAT hearing being Samantha's imminent death and then via appeal process at the AAT hearings, being the overwhelming impact on my mental health state, thus allowing only one side of the story to be told, that of Centrelink the respondent with their unchallenged evidence. Centrelinks' non pursuance and debt collection of the said debt for 7 years. Centrelink's non pursuance of Newstart allowance paid to Samantha between 24 December 1999 and 23 January 2000, for which if deemed to be in a marriage like relationship with me, she would have had to repay in full or at least a differential. Evidence presented by the respondent to the AAT was of such a prejudicial nature with absolutely no probative value at all to the matter, it painted such a picture that any reasonably minded person would find it impossible to not have their thinking processes tainted by such, without balanced explanation from the other arguing side. Anything possibly gleaned from such, "is fruit from the poisoned tree," and as such the admissibility of such at law is strongly questioned as to its probative value? A combination of all this ... would lead a reasonable minded person to the possibility of an apprehension of bias, which I understand is the test at law. Mr Fazio goes on to contend that he has standing to bring the appeal due to the appeal process arising on the basis that he was a party to the AAT proceedings and his involvement has continued as a natural progression by which the applicants are 'sequentially bound, through the SSAT, AAT and now this honourable Court'. He relies on a passage from Clay v Oxford (1866) LR 2 Ex 54 by Bramwell B in which it was said that 'if we could see some person suing who had a beneficial interest in the claim made, though not legally entitled to sue, the case would be within the principle of the authorities cited'. Mr Fazio says that his proximity can not be denied as the sole beneficiary of the estate. Indeed, she had died prior to the AAT hearing. There is no power to issue proceedings by a deceased person and such proceedings are a nullity ( Re Prichard Deceased (1963) 2 WLR 685 at 693). A cause of action may, however, survive the death of an applicant but in those circumstances the proceedings must be brought by persons who are legally authorised to deal with the deceased's estate. That is to say, the proceedings would be brought and maintained by the executor or administrator of the deceased's estate. That has not occurred. The Secretary contends that insofar as the first applicant is concerned, the property of a deceased person in Western Australia including any chose in action vests in the Public Trustee at the time of death. It then passes to an executor or administrator on the making of a grant of representation by virtue of s 8 and s 9 of the Administration Act 1903 (WA). The executor or administrator of a deceased estate is under a duty to take all reasonable steps to gather in the property of the estate, to discharge any liabilities owed by the deceased and to distribute any remaining property to the beneficiaries of the estate. Subject only to a relevant cause of action actually surviving the death of a deceased, it is only the executor or administrator who may commence and maintain a legal action to recover property which is said to form part of the estate. Indeed, in Clay v Oxford (1866) LR 2 Ex 54 and more recently in Dawson (Bradford) Ltd v Dove (1971) 1 QB 330 at 334-335, it was held that where an action is commenced in the name of a deceased person, the executor or administrator cannot be substituted as the applicant. There is nothing in the Federal Court Rules (FCR) which permits the Court to substitute the executor or administrator of a deceased estate for the applicant where those proceedings were commenced after the death of an applicant. There is a discretionary power under O 6 r 10 and r 15 FCR for the Court to substitute an executor, administrator or another appropriate person where a party to a proceeding has died. Once again, however, those rules only apply where the person has died after the commencement of the proceedings ( Frederikshavn Vaerft A/S v Stena Rederi Aktiebolag [2002] FCA 1024 ; (2002) 124 FCR 243 per Sundberg J (at [23]). See also State of Western Australia v Southern Equities Corp Ltd (in liq) & Ors [1997] FCA 875 in the context of a party having died when proceedings were pending and there was no personal legal representative). This is not a situation where proceedings were pending as Ms Underdown had died prior to the hearing of the AAT appeal itself. As his Honour observed, a critical factor in the exercise of discretion is that any order made under the section must serve a useful purpose. If there were a motion before the Court in this situation for an order under O 6 r 15 FCR, I would need to be satisfied that making such an order would serve a useful purpose. There is not an application, but in any event I cannot be satisfied that a useful purpose would be served. Such interest as Ms Underdown held in the 'appeal' passed to the executor or administrator of her deceased estate in July 2007 when she died. This was a significant period prior to the commencement of the appeal. Mr Fazio also relies on an enduring power of attorney which was held in relation to the deceased person prior to her death as authority on which to bring these proceedings. However, an enduring power of attorney is applicable during the lifetime of a donor (with or without the donor's capacity as the case may be). It ceases (relevantly) on the death of the donor. There is no evidence before the Court as to the appointment of Mr Fazio as executor or administrator of the estate of Ms Underdown. It is true that Mr Fazio represented Ms Underdown in a sense before the AAT (as he was invited to do so) but there is no evidence before the Court sufficient to satisfy the Court that Mr Fazio is authorised to bring and maintain the proceedings on behalf of the deceased person. The application for review before the AAT sought to challenge decisions made by Centrelink in relation to the entitlements of the deceased person to social security benefits. That application was not concerned with any entitlement held by Mr Fazio to social security benefits or otherwise. The interest of Mr Fazio in the matter was in connection with the inquiry as to his relationship with the deceased person. No relevant interest on the part of Mr Fazio (financial or otherwise) has been demonstrated in the appeal which is pursued in this Court. Even if these difficulties could all be cured, there are more fundamental problems for the applicant(s) and it is in the interests of no party to these proceedings, nor the Court, nor the public, that proceedings which have no prospect of success should be allowed to continue. This practice should not be ignored and a failure to act consistently with the practice is apt to cause an appeal to miscarry for an appellant. There is no question of law articulated by the alleged abuse of legal process by Centrelink in raising the debt. There is no evidence that pursuit of it was deliberately engaged in on a basis that was vexatious, fanciful, capricious or malfeasant and that being so, there can be no question of a serious miscarriage of justice arising out of pursuit of the debt. None of the grounds as formulated, in my view, identities a question of law but bearing in mind the responsibility the Court has in relation to unrepresented litigants, I will endeavour to identify the most likely questions of law which may be said to arise. Issue estoppel does not arise from decisions where the Tribunal is conducting a merits review of an administrative decision: Midland Metals Overseas Ltd v Comptroller-General of Customs and Others (1991) 30 FCR 87. The problem with this argument is the gap in time between the decisions and the availability to the SSAT of a deal more information than was originally available. In Commonwealth v Sciacca (1988) 17 FCR 476 the Full Court held that the question of issue estoppel can only arise when ultimate facts determined between the parties in judicial proceedings cover the same issues to be determined by a Tribunal and at the Tribunal level: see Re Cooper and Repatriation Commission (1995) 38 ALD 164. The AAT is required to stand in the shoes of the primary decision-maker --- Esber v Commonwealth [1992] HCA 20 ; (1992) 174 CLR 430 at 440. As a general proposition it should base its decisions on the most recent and accurate information at hand: Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40 ; (1986) 162 CLR 24 at 44-45. The question falling for consideration for the AAT was not whether the decision-maker made the correct or preferable decision but whether that decision was correct or preferable on the material before the Tribunal: Drake v Minister for Immigration and Ethnic Affairs [1979] AATA 179 ; (1979) 46 FLR 409 at 419. The decision of the SSAT made in February 2002 was concerned with the payment of rent assistance to Mr Fazio. The SSAT was not considering in that decision whether the applicants were living in a marriage-like relationship for the purpose of the SSA. The SSAT accepted at face value, as Centrelink had done at the time, the assertion by the applicants that they had separated in December 1999. The issue before the SSAT was whether Mr Fazio had provided Centrelink with a rent certificate in January 2000 which would qualify him to receive rent assistance payments from that time. These facts and circumstances cannot create any issue estoppel or any other binding authority on the inquiry required to be made of the AAT and which is the subject of the appeal in this decision. The Centrelink decision of April 2003 was as to the applicants' relationship in the context of s 4 SSA. However, in the current appeal the only matter falling for consideration is the decision of the AAT. The alleged denial of procedural fairness by the SSAT is now irrelevant. In these circumstances, the requirement contained in s 39 that the Tribunal shall ensure that a party to the proceedings before it be given a reasonable opportunity to present his case constitutes statutory recognition of an obligation which the law would, in any event, imply. However, what will be procedural fairness will depend upon the particular circumstances of each case. The legislature has expressly recognised that the AAT may exercise a discretion to proceed in the absence of the party where it is satisfied that the party has had reasonable notice of the hearing proceeding. That notice is reflected not only in the reasons but also in an affidavit of Mr Paul Maishman on which the Secretary relies. That affidavit deposes to the interlocutory processes and orders made by the AAT prior to the hearing in this matter. Those processes afforded the applicants several opportunities to provide evidence and to participate in the proceedings. In particular, the listing notice issued by the AAT in relation to the hearing date for the application for review gave Mr Fazio four months notice of the hearing date. There will be many circumstances in which proceeding in the absence of an applicant will not afford procedural fairness. Such an example may be found in Bourke, Michael Vincent v Companies Auditors & Liquidators Disciplinary Board [1998] FCA 742. In that case, the applicant had telephoned the AAT on the date of the hearing stating that he was unwell but requesting a hearing by telephone link which was declined and no adjournment was offered. Although Mr Fazio also expressed that he was unwell, he did not request any deferral of the hearing and did not offer to provide any medical evidence to support the assertion. Some such medical evidence has now been made available in the course of this appeal where other requests for adjournments have been made. In Cook v ASP Ship Management Pty Ltd [2008] FCA 1345 , the Court concluded that the AAT was not obliged to simply accept an applicant's assertions in favour of an adjournment without further elaboration. The Court also had regard to events which had preceded the AAT decision when it concluded that there had been no breach of the obligations under s 39(1) of the AAT Act. More importantly, prior to the hearing, Mr Fazio sent facsimiles at 2.48 pm on 26 August 2008, 3.47 pm on 26 August 2008 and 4.14 am on 27 August 2008. Those communications, in addition to confirming the ill health of Mr Fazio, made complaints similar to that which are being raised in this appeal. It was also foreshadowed that Mr Fazio's ill health would, in all probability, preclude his attendance at the hearing. The AAT did deal accurately with, albeit by summary form with the content of this material, and it is correct to say that there was not an application for an adjournment. The fundamental nature of the complaint raised in these communications was the mistreatment which had been sustained at the hands of Centrelink but also more specifically the complaint that the AAT did not have before it all of the materials that had been before the SSAT. Mr Fazio also asserted that the decision of the SSAT made in February 2002 had been excluded from the T documents before the AAT. However, that decision was included. In any event, given the importance which Mr Fazio attached to these matters, he had ample opportunity prior to the hearing to ensure that any material he wanted to have included in the T documents and which should have been before the AAT was, indeed, before the AAT. (Directions were made by the AAT on 17 April 2008 in relation to the filing of the evidence of the parties). The T documents were sent to the applicants on 31 July 2007 and the supplementary T documents were sent to Mr Fazio on 26 June 2008. As he made clear in his letters faxed to the AAT on 26 and 27 August 2008, he had access to that bundle of material which had been before the SSAT. Although the primary position of the Secretary is that the material was before the AAT, it was certainly within the power of Mr Fazio to ensure that it was. Mr Fazio also made five sets of submissions before the hearing of the AAT by way of letters and written submissions in which he advanced the arguments and evidence on which he wished to rely. What will be a reasonable opportunity to present a case will vary with the circumstances but the history outlined by the Secretary in this appeal makes it clear that Mr Fazio and prior to her death, Ms Underdown had and made use of numerous opportunities to make submissions on the factual issues in dispute. They took advantage of those opportunities by the several facsimiles and submissions provided to the AAT. The legislature expressly provided for an opportunity for the AAT to proceed in the absence of a party. Clearly it should not do so in an inappropriate circumstance. Procedural fairness to present submissions and evidence should be afforded. However in this review, given the sum in issue, the interlocutory steps that had already been taken and the opportunities offered to present evidence and materials, I am satisfied there is no realistic prospect of establishing an absence of procedural fairness before the AAT. The only Tribunal falling for consideration on this appeal is the AAT. As to that Tribunal, the applicants appear to base their assertions of bias on the fact that insufficient weight was given to their evidence. It is well established that findings of fact including findings in relation to credibility are a matter for the AAT. It is pre-eminently the prerogative of the AAT to allocate the appropriate weight to the evidence before it. The weight to be given is not a question of law unless it can be said that the decision is unreasonable ( SZJEZ v Minister for Immigration and Citizenship [2008] FCA 1741 at [15] ). But unreasonable in this sense means reaching a finding unsupported by any evidence or based on findings thought to be supported by inferences drawn from primary facts where those inferences were not open as a matter of law. I am unable to conclude that any reasonable person being apprised of the issues involved and the role of the Tribunal could entertain a reasonable apprehension that the AAT in this circumstance might not bring an impartial and unprejudiced mind to the resolution of the question which was before it. There is no evidence to support a conclusion of bias or apprehended bias. There is no indication of bias on the face of the record or in the reasoning process of the AAT. I am satisfied there is no reasonable prospect of establishing bias. Further, the Secretary contends that there is no reasonable prospect of prosecuting any purported claim for damages as no private right for damages arises from the exercise of administrative powers in circumstances where there is a statutory right of review of the exercise of those powers: Jones v Department of Employment [1989] QB 1. This theory is applicable to circumstances where there is a right to review of the exercise of administrative powers. That in turn is reflected in what the Full Court held in Scott v Department of Social Security [2000] FCA 1241 ; (2000) 65 ALD 79 in which it was held that alleged breaches of the SSA would not confer private rights for damages saying (at [19]): We agree with the trial Judge that the Act is not to be interpreted as indicating an intention to confer a private right of action for a breach of any of its provisions now in question, given especially the existence in the legislation of particular mechanisms for the review of decisions made within the department. So much has been exemplified by the High Court decisions in Crimmins , Sullivan , Graham Bailey Oysters and Shaddock , and by the majority judgment of the Full Federal Court in the earlier Scott litigation. The circumstances of the appellants which I have outlined and reviewed stand outside the principles cited earlier from those authorities. The largely discursive nature of the appellants' submissions evinces significant misconception on their part of the restricted parameters governing appeals to a Full Court concerning in particular the decisions or other conduct of the officers of administrative authorities, being the parameters identified earlier in Hamsher , Cabal , and Sydney Wide Distributors , which are not attracted by the complaints and submissions the appellants have sought to advance. All decisions taken by Centrelink as to the grant, cancellation, suspension or rate of payment of a social security benefit are subject to the extensive review procedures in Pt 4 of the SSAA. It follows that no claim for damages can be made out. Further, no evidence has been adduced to support any assertion that decisions made by Centrelink were made in bad faith or amounted to misfeasance. Moreover and at a general level, this Court has no jurisdiction of general oversight of the administrative efficiency of Federal Government entities ( Wang v Secretary, Department of Employment & Workplace Relations [2006] FCA 898 at [48] per Heerey J). My attention has also been drawn by affidavit evidence to the applicants' commencement of proceedings in this Court seeking amongst other things reimbursement of the sum of $70.86 which was said to have been 'wrongly deducted' from a Disability Support Pension paid to Ms Underdown. The applicants also sought damages for negligence on the part of Centrelink. On 16 December 2008, those proceedings which were then only in the name of Mr Fazio were dismissed by the Federal Magistrates Court ( Fazio v Centrelink (No 2) [2008] FMCA 1389). It appears to be that the present appeal is again purporting to raise a claim in damages arising from Centrelink's actions in raising and recovering the debt of $70.86. An appeal to this Court from the decision of the AAT certainly does not give the Court jurisdiction in effect to review the decision of the Federal Magistrates Court. There is also a claim for notional out of pocket expenses but in the absence of any foundation either for the claim or of the expenses, such a claim cannot succeed. These reasons do not develop at length the underlying very sad circumstances in which the complete breakdown in communications between Mr Fazio (now) and Centrelink have developed. However unfortunate that may be, there is no power in the Court to entertain this appeal but, in any event, no useful purpose would be served by allowing an inevitably doomed appeal to continue to run. To do so would not be in the interests of the respondent, of Mr Fazio, of the public or the Court. The appeal must be dismissed. Costs would follow the event in the ordinary course. I will allow Mr Fazio 10 days from the date of delivery of the reasons file any written submissions as to why costs should not follow the event. The Secretary is to file written submissions, if any, in response within a further 7 days. I certify that the preceding sixty-six (66) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher. | judicial review appeal from decision of administrative appeals tribunal whether first applicant a proper party and capable of commencing proceedings whether second applicant has standing to bring appeal whether denial of procedural fairness whether issue estoppel whether right to damages for alleged breaches of social security act 1991 administrative law |
Whilst he has filed an appeal to the Administrative Appeals Tribunal he has not sought any stay of the cancellation. By saying that I do not mean to indicate that I would expect that there would be any such application. However, the status quo being what it is, there is little alternative but to ensure that the administration and liquidation of these various companies goes ahead in an orderly fashion not interrupted any more than is necessary by what has occurred. 2 The appropriate consents having been lodged and the appropriate proof in relation to each company having been tendered, I am satisfied that the orders should be made pursuant to s 449B and s 503 of the Act respectively. I make orders in accordance with the short minutes of orders which I have initialled and placed with the papers. | external administration defendant's registration cancelled by company auditors and liquidators disciplinary board removal of the defendant as liquidator of companies and as administrator of deed of company arrangement corporations law |
2 Each taxpayer is an applicant by Notice of Motion in each proceeding for Orders that the Commissioner is not entitled to now raise the contended effect upon a relevant transaction of s 468 of the Corporations Act 2001 (Cth) in support of the amended assessment, on the ground that to do so denies each taxpayer procedural fairness. Alternatively, Orders are sought in connection with an Application made by a trustee (controlled by the taxpayers) of a trust for an extension of time pursuant to s 160WA(2) of the Income Tax Assessment Act 1936 (Cth) ('the 1936 Act') to rely upon the certificate of a liquidator of Rothwells Ltd, shares in which are said by each taxpayer to have been the subject of a disposal event for Capital Gains Tax purposes on or about 26 May 1993. Further, in the event that the Commissioner is entitled to rely upon the additional matter concerning s 468 of the Corporations Act , each taxpayer seeks leave pursuant to s 14ZZO(a) of the TA Act to amend the grounds stated in each objection to which the objection decision relates. 3 Lastly, each taxpayer complains that the Commissioner's Statement (and Amended Statement) of Facts Issues and Contentions ('ASFIC') asserts that events in 1993 and 1998 had the effect of resettling the relevant trust thus extinguishing capital losses in the trust yet the ASFIC fails to identify the acts, transactions and events that support that contention. Each taxpayer seeks an order that the Commissioner comply with Order 52B, rule 5(2)(a)(iv) of the Federal Court Rules which requires the Commissioner to file an 'appeal statement' (the ASFIC) that complies with the Federal Court Rules . The appellants contend, in effect, that since the term 'appeal statement' means 'a statement outlining succinctly the Commissioner's contentions and the facts and issues in the appeal as the Commissioner perceives them' (Order 52B, rule 5(3)), the Commissioner must identify all the material facts giving rise to the perception so that the taxpayer fairly understands the real content of the controversy to be quelled by an exercise of judicial power particularly having regard to the burden upon the taxpayer of proving that the amended assessment in each case is 'excessive' (s 14ZZO(b)(i)). 4 Accordingly, each taxpayer seeks greater elaboration upon the factual foundation for the Commissioner's perception as to resettlement of the trust in 1998. 5 As to the burden of proof, the appellants, although not raising the question by their motion, articulated on the hearing an additional matter to this effect. The Commissioner's ASFIC proceeds on the footing that each applicant is put to proof on all facts on which each applicant seeks to rely to establish that the amended assessment is excessive and no fact recited in the ASFIC is an admission by the Commissioner of any fact. The appellants say that there is a distinction to be made between the onus of proof on the ultimate question borne by the appellants and an evidential onus that shifts according to particular issues. Thus, a contention of the Commissioner that certain events in 1993 and 1998 had the effect of extinguishing a capital loss, requires it is said, the Commissioner to discharge an evidential onus of establishing those foundation facts supporting the contention. The Commissioner says there is no evidential onus upon the Commissioner and each appellant bears the onus of proving to the standard required that the assessment is excessive. The role of the appeal statement is to frame the issues the taxpayer must meet. 6 No particular Order is pressed in relation to the onus point. It is not raised by the motion and the respondent was not expecting to have to deal with it. In any event, it seems to me inappropriate to make directions about which party bears an evidential onus on any particular issue (if an evidential onus truly shifts). The question is a matter for the conduct of the hearing. 8 The factual background involves facts which, of course, are in controversy. However, the controversy relevant for present purposes is this. On 2 July 1984, the Carringbush Unit Trust ('the Carringbush Trust') was established with Carringbush Pty Ltd ('CPL') as trustee. In the year ending 30 June 1988, CPL acquired as trustee of the trust, 474,791 ordinary shares in Rothwells Ltd and 949,583 cumulative preference convertible shares in the company for $2,492,654.50 in all (p 15, Appellable Objection Decision --- David Clark). On 3 November 1988, a provisional liquidator was appointed to Rothwells and on 22 September 1989, the company was placed in official liquidation. The appellants say that on 26 May 1993, CPL (controlled by the Denoon interest) sold all of the shares to Carringbush Corporation Pty Ltd ('CCPL' (also controlled by the Denoon interest)) for $1.00 thereby crystallising a loss of $2,492,654.00 arising out of a disposal, that is, a CGT event. The Commissioner at p 13 of the Objection Decision accepted that $1.00 was the market value of the shares on 26 May 1993 having regard to the liquidation and, in particular, the liquidator's declaration of 16 August 1994 that there was no likelihood that ordinary shareholders or any other class of shareholder would receive any distribution in the course of the winding up of Rothwells. 9 In each objection decision, the Commissioner contended that because certain events occurred leading up to 24 June 1993, a new trust arose on that date with the result that capital losses in the Carringbush Trust were not available to offset capital gains realised in the reconstituted trust. 10 Those relevant events are set out at pp 2-5 of each objection decision. The Commissioner also contended that a sale of land at Gladstone by the Carringbush Trust (said by the taxpayer to give rise to a capital gain) was profit derived on revenue account and secondly, that Part IVA of the 1936 Act relevantly applied entitling the Commissioner to make a particular determination under s 177F(1)(a) of the 1936 Act. Neither of those contentions are now pressed. 11 In the ASFIC, the Commissioner says, no disposal of shares occurred on 26 May 1993; no change of ownership occurred; the share register of Rothwells records CPL as the holder of the shares not CCPL; no court has granted leave in respect of the disposal of shares; s 468 of the Corporations Act renders the purported disposal void; no capital loss can arise out of a void transaction as a matter of law; and no 'disposal' crystallising a loss arose for the purposes of s 160WA arising out of the declaration of the liquidators of 16 August 1994 because no 'election' was made within the time limited by s 160WA(2). It is common ground that the trustee of the Carringbush Trust did not make an election for the purposes of s 160WA(1) within the time limited by subsection (2). 15 Other contended facts are these. 16 A Deed of 24 June 1993 between CPL and 'the Carringbush Group' recites CPL's notice of intention to resign as trustee of the Carringbush Trust. David Clark Enterprises Pty Ltd, for a fee, was to be and was appointed as the new trustee of the Carringbush Trust. For the financial year ending 30 June 2001, DCE Holdings Pty Ltd as trustee of the David Clark Family Trust was presently entitled as the sole unit holder in the Carringbush Trust to all the income of the trust. The trustee of the Carringbush Trust sold land at Gladstone in the financial year ending 30 June 2001 and asserted that no taxable capital gain arose in that financial year due to available offsetting capital losses in the trust. The Commissioner contended, due to the alleged resettlement events of 1993, that the capital losses were not available. The Commissioner therefore increased the income of the Carringbush Trust by the amount of the realised capital gain on sale of the land of $1,932,006.51 resulting in a net capital gain in the trust (due to 'discount capital gain treatment' of 50%) of $965,953.00. That gain is said by the Commissioner to have flowed to the trustee of the David Clark Family Trust and to the beneficiaries David Clark and Helen Clark resulting in an increase in the assessable income in the hands of each taxpayer of $482,976.00 in the financial year ending 30 June 2001. 19 The ASFIC filed by the Commissioner plainly enough relies upon an additional contention to support the amended assessment not relied upon in the objection decision nor, apparently, in issuing the amended assessment. The Commissioner is entitled to support the amended assessment on a ground not taken into account at the time the assessment was made ( Federal Commissioner of Taxation v Wade [1951] HCA 66 ; (1951) 84 CLR 105; Commissioner of Taxation v ANZ Savings Bank Ltd [1994] HCA 58 ; (1994) 181 CLR 466 per Brennan, Deane, Dawson and Toohey JJ at 479). In an appeal to the Court, nothing in the 1936 Act (nor the Income Tax Assessment Act 1997 (Cth) ('the 1997 Act')) or the TA Act confines the Commissioner to matters raised in the objection decisions ( Commissioner of Taxation v ANZ at pp 478 and 479). Just as the Commissioner was entitled to rely upon the proper effect of s 26(j) of the Income Tax Assessment Act 1936 --- 1947 in bringing a particular receipt, as a matter of law, within the assessable income of the taxpayer even though the provision was not considered in making the assessment ( Federal Commissioner of Tax v Wade at p 116, per Kitto J) and, entitled, in a similar way, to rely upon the effect of s 32(4) of The Local Government Acts 1936-1965 (Qld) in rendering a purported lease void and therefore depriving the taxpayer of an entitlement to deductions claimed ( Queensland Television Limited v Commissioner of Taxation [1969] HCA 41 ; (1969) 119 CLR 167), so too is the Commissioner entitled to rely upon s 468 according to its terms exposed by authority. Further, no conduct of the Commissioner gives rise to an estoppel in failing to raise the contention earlier. Plainly enough, the interests of the taxpayer must be preserved by ensuring that the taxpayer is given sufficient and proper notice of the contention. 20 The appellants say the point of distinction in this case, however, is that the introduction of the s 468 point into the controversy deprives the appellants of a procedural opportunity to respond and be heard on the merits as the resolution of the point turns on facts arising after the date of the objection decision and the court's decision in Commissioner of Taxation v Jackson (1990) 27 FCR 1 precludes the relevant facts being taken into account in exercising jurisdiction under Part IVC of the TA Act. 21 The relevant fact is said to emerge in this way. The taxpayer thought the sale by the trustee on 26 May 1993 effected a disposal. Now it is said that events at that time did not give rise to a disposal and if they otherwise did so, s 468 renders the disposal void. The response of the taxpayer is to seek to rely upon an alternative disposal event effected by the statute, s 160WA(1) of the 1936 Act, based upon an election by the trustee. The time for making the election has expired although the Commissioner may extend the time under s 160WA(2) in response to a request for an extension of time. That application to the Commissioner has been made by the trustee and is yet to be decided. When the trustee's extension application is decided by the Commissioner, the decision to extend time (if made) and the trustee's election (said to give rise to the crystallisation of a capital loss) are facts, it is said, arising after the making of the objection decision which cannot be taken into account in determining whether the amended assessment issued on 25 November 2005 is excessive. Thus, the contended denial of procedural fairness. 22 The position seems to me to be this. 23 The Commissioner is entitled to say that the application of the law to those facts said by the taxpayer to constitute a disposal on 26 May 1993, renders the disposal void. The contention is either good or bad but can properly be made. The issue is not frivolous or without argument. If the contention is sound, the Commissioner is entitled to rely upon the proper operation of the law giving rise to the result contemplated by the section. The operation of the section will, no doubt, turn upon the facts found to which the section applies, a construction of s 468 according to authority and possibly the intersection of that provision with the relevant sections of the 1997 Act dealing with capital gains and capital losses. The appellants say that a prohibition upon transfer of shares does not affect the passing of a beneficial interest in the shares to CCPL; CPL became a trustee of the shares for CCPL on 26 May 1993 and as a result, a disposal for CGT purposes occurred resulting in a realised capital loss. Those contentions and cross contentions can properly be made, in part, the subject of the appeal. It is inappropriate for present purposes to express any view about the strengths or weaknesses of those arguments. The question of whether reliance might have been placed upon the liquidator's declaration of 16 August 1994 and the application now made by the trustee of the Carringbush Trust to extend time to make an election are entirely separate matters although, potentially, related. If an extension is granted and the trustee makes an election (or the relevant taxpayer makes an election; s 160V(1) of the 1936 Act) resulting in a disposal at a material date , those events may result in the amended assessment of 25 November 2005 for the year ending 30 June 2001 being further amended by the Commissioner. That result might, in turn, depend upon whether a capital loss arises by reason of those new events; a consideration of when the capital loss arises; and whether other matters such as the Commissioner's contentions in relation to resettlement of the trust informs that outcome. 24 However, these events as to the trustee's application for an extension of time and a consideration of whether the Commissioner might make a decision favourable to the taxpayer on that question, are, for the moment, speculative. They do not bear on the question of whether the amended assessment issued by the Commissioner for the year ending 30 June 2001 is excessive. It may be demonstrated however that should certain events occur, the consequence of those events as a matter of law is relevant to the question of whether the amended assessment of the Commissioner issued to each taxpayer on 25 November 2005 is excessive particularly since an extension of time resulting in an election by the taxpayer gives rise to a 'relation back' to 'the time the declaration was made', namely, 16 August 1994. 25 If those events, should they occur, are demonstrated to be relevant to the question of whether the amended assessment remains excessive (because, for example, an alternative disposal event may be demonstrated to have arisen resulting in a realised capital loss at 16 August 1994), it seems to me that each taxpayer would be entitled to seek leave to amend the grounds stated in each taxation objection to raise, in the alternative to the contended disposal, another ground upon which a capital loss is said to have been realised. 26 The decision of the Full Court of this court in the Commissioner of Taxation v Jackson (supra) does not establish a rigid principle that no fact or event occurring between the date of the Commissioner's appellable objection decision and the hearing of the appeal can ever be taken into account in a referral of an objection decision to the court. The Full Court of this court recognised in Jackson that, in principle, it is unlikely that events arising after the making of the objection decision could be 'relevant' to the question of whether the amended assessment is excessive. The court also recognised, for example, that evidence of the formation of a state of mind by the Commissioner after the date of assessment in circumstances where the legislation required the formation of a state of mind at the date of assessment, would be irrelevant having regard to the statutory criteria. 27 The question will always be whether evidence of events occurring after the date of the objection decision can be demonstrated 'as being of relevance in the determination of a tax appeal' ( Commissioner of Taxation v Jackson at p 19 per Hill J). Equally clearly, the court recognised that it would be difficult to conceive of circumstances which would render events (or evidence of events) occurring after the date of the objection decision, relevant. Although the taxpayer must show that the amended assessment objected to is excessive, that which comes before the court is the objection decision in its entirety and the court's power to make orders dispositive of the appeal is expressed in the widest terms (s 14ZZP). Because the exercise of judicial power is an appeal 'against the decision ' (s 14ZZ(a)(ii), the controversy, in principle, must be limited to events affecting the liability of the taxpayer at a date 'no later than the date upon which the objection decision is made' ( Jackson , p 20, per Hill J). It may be that a decision of the Commissioner in response to the application of the trustee of the Carringbush Trust in conjunction with an election, will result in a disposal event that affects the liability of the taxpayer as at the date of the objection decision by reason of the operation of the provisions of the legislation. If so, evidence of those events might be shown to be relevant and if relevant, admissible. 28 It seems to me that there is no principle which as a matter of absolute application prohibits the reception of evidence of events between the date of the making of the appellable objection decision and the date of hearing. The taxpayer would need to demonstrate the relevance (and admissibility of evidence) of the event. 29 Unless and until the event occurs, the question does not arise. 30 Accordingly, no procedural fairness arises in the sense contended for by the applicants. The Commissioner is entitled to rely upon the proper operation of s 468 of the Corporations Act . The contention can be fairly raised as there is more than enough time to enable the appellants to deal with the contention. In that sense, there is no prejudice. 31 It seems to me that the real or underlying point the appellants seek to agitate is not so much procedural unfairness based upon foreclosure of a right to agitate post objection decision events in answer to the s 468 contention but rather, perceived unfairness arising out of the Commissioner now agitating the notion that any disposal on 26 May 1993 is void by operation of law when the trustee of the Carringbush Trust might have effected a disposal of the shares (effective on 16 August 1994) by making the election contemplated by s 160WA(1), in writing, to the Commissioner on or before lodgement of each taxpayer's return of income for the year of income in which the liquidator's declaration was made, that is, 30 June 1995 since the declaration was made on 16 August 1994. The short point is that no election was, in fact, made because the trustee of the Carringbush Trust assumed, rightly or wrongly, that the transaction of 26 May 1993, 15 months prior to the liquidator's declaration, was an effective sale or disposal of the shares thus crystallising a capital loss. However, that assumption does not now deprive the Commissioner of the right to raise the proper operation of the law derived from s 468 of the Corporations Act as understood according to authority in support of the amended assessment. Equally clearly, the taxpayer is entitled to raise contentions in response with leave and might also seek to demonstrate the relevance of future events when they occur to the question of the liability of the taxpayer at the date of the objection decision and, if relevant, seek leave to further amend the grounds of objection. 32 In addition, the appellants seek leave to amend their respective grounds of objection to raise six additional matters. Grounds 1, 2 and 3 are responsive to the Commissioner's contention that the contended disposal of 26 May 1993 is void. Ground 4 is a contention that by force of the objection decision, the Commissioner is taken by operation of s 169A(3) of the 1936 Act to have made a decision to extend time under s 160WA(2) of the 1936 Act although the additional ground does not contend that the trustee made an election either at all or with any particular consequence. Ground 5 is a contention that the alleged resettlement of the Carringbush Trust in 1998 was a CGT event for the purposes of the 1997 Act resulting in the realisation of a capital loss in relation to the Rothwells' shares in 1998. Ground 6 is a contention that there is no reason why the court would not grant such approval as is necessary under the Corporations Act to affirm the disposal transaction on the part of the trustee on 26 May 1993. 33 I propose to give leave to each appellant to amend the Grounds of Objection to the amended assessment in each case in terms of grounds 1, 2, 3 and 5 of the proposed amendment annexed to the Notice of Motion. Grounds 4 and 6 are not proper grounds of objection to the amended assessments. 34 Each appellant seeks an Order by the motion, in the alternative to what I have described as the strikeout part of the motion, to join or consolidate with the resolution of the appeal, matters going to the respondent's consideration of the extension request by the trustee of the Carringbush Trust on 26 April 2007. Further, each appellant seeks an Order that if the Commissioner's decision under s 160WA(2) is favourable , the respondent ought not to be entitled to now rely upon the argument derived from s 468 of the Corporations Act . Alternatively, if the Commissioner's decision is unfavourable to each taxpayer, the appellants seek an Order that that decision form part of the respondent's objection decision and that a contended error in refusing to grant an extension, be the subject of a further amendment to the grounds of objection of each taxpayer, with leave. In addition, if it is demonstrated that the Commissioner erred in making an unfavourable decision under s 160WA(2), the appellants seek an Order that the Commissioner not be entitled to rely upon the s 468 argument. 35 The only questions alive in each appeal are matters going to the amended assessment and the objection decisions of the Commissioner in relation to each taxpayer's objection. There is no proper basis for joining in the adjudication of the questions alive on appeal a question going to the Commissioner's consideration of a request by the trustee of the Carringbush Trust nor a consideration of whether the Commissioner erred in making an administrative decision to either grant or refuse the trustee's application for an extension. Nor is there a proper basis for joining in the appeal the question of whether the refusal to extend time to the trustee deprives the Commissioner of the right to rely upon the consequences that flow from properly applying s 468 of the Corporations Act to facts as found. As discussed earlier, each appellant may be able to demonstrate should particular events occur that those events are relevant to the question of the liability of each taxpayer at the date of the objection decision. If so, an application might be made to amend the grounds of objection to raise the additional matters. Nor is there a proper basis for joining any challenge by an 'aggrieved person' to the Commissioner's decision on the extension question under the Administrative Decisions (Judicial Review) Act 1977 (Cth) ('the ADJR Act'), in each appeal. Each of these matters are truly separate and discrete questions notwithstanding that the outcome of some of them may then be shown to have relevance for the questions presently alive on the appeal. 36 The remaining question is whether the Commissioner in filing an appeal statement which is treated as the document described as the Amended Statement of Facts Issues and Contentions has complied with Order 52B, rule 5(2)(a)(iv) of the Federal Court Rules . The appellants say the Commissioner has not done so because the ASFIC at paragraph 5(3) of the contentions at page 24 of the ASFIC simply asserts: 'Alternatively, the acts, transactions and events, related above, that occurred on or about 8 September 1998 constituted a resettlement of [the Carringbush Trust]'. That paragraph recites a cross reference which is unidentified. Paragraph 61 at page 13 of the ASFIC recites that the Carringbush Unit Trust was varied by a Deed of Variation which redefined the term 'net income'; introduced a new class of units; reclassified the existing units as 'ordinary units'; introduced a new clause entitling the trustee to issue discretionary units to persons not holders of ordinary units and replaced clause 11(a) and (b) with a new clause 11 comprising subparagraphs (a) to (g). At pages 2 --- 5 of each objection decision, the Commissioner identifies the facts and circumstances which are said to give rise to the creation of a new trust with the result that the Carringbush Unit Trust ceased to exist on 24 June 1993. Some similar events are identified at paragraph 61 of the ASFIC in relation to the events on 8 September 1998. 37 However, it seems to me that each taxpayer is entitled to be told all of the relevant facts, circumstances and contentions which support the proposition that a resettlement of the Carringbush Unit Trust occurred on 8 September 1998. The Commissioner contends that all that is required for a compliant appeal statement is a sufficient statement to reflect the facts and issues in the appeal 'as the Commissioner perceives them'. The word 'perceives' is said to quite deliberately limit the obligation of the Commissioner to a statement of perception which is something well short of proper and full particularity of the facts and circumstances supporting a contention. I do not accept the Commissioner's submission on this matter. It seems to me that a taxpayer is entitled to be properly informed of the content of the contention especially since the taxpayer bears the ultimate burden of demonstrating that the amended assessment is excessive. The appeal statement must propound all the necessary ingredients of the claim for which the Commissioner contends and disclose the facts upon which the respondent has based the contention. It is not sufficient to simply assert the resettlement of the trust and in a generic and conclusionary way assert reliance upon all of the preceding acts, transactions and events recited in the appeal statement as a statement of the material facts enlivening the particular contention. The taxpayer is entitled to be told which facts are relied upon to support the contention that a resettlement of the trust occurred on the relevant date. Is it some of the preceding facts or each and every fact? If reliance is placed upon acts and events at a time other than 8 September 1998, which acts are relied upon? Although the ASFIC is not devoid of any stated basis for the contention (as illustrated, for example, in the circumstances of Rio Tinto Ltd v Federal Commissioner of Taxation (2004) 55 ATR 321), the Commissioner ought to be able to say with focussed precision and discipline precisely what facts and circumstances support the contention thus providing a proper exposition of the contention itself. Accordingly, I propose to make an Order that the Commissioner provide within 14 days a statement of those acts, transactions and events which support the contention that a resettlement of the Carringbush Trust occurred on 8 September 1998. 38 The costs of the motion will be reserved. I certify that the preceding thirty-eight (38) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood. | consideration of an application to strike out reliance by the commissioner of taxation upon s 468 of the corporations act 2001 (cth) in support of an amended assessment, on the ground that reliance by the commissioner upon the section would result in procedural unfairness in the conduct of an appeal from an objection decision of the commissioner consideration of whether the commissioner is entitled to raise a new matter not relied upon in issuing an amended assessment or making a decision on the taxpayer's objection to the assessment consideration of the taxpayer's entitlement to raise and rely upon events occurring after the date of the commissioner's objection decision consideration of an application for leave to amend grounds of objection to an amended assessment issued by the commissioner of taxation consideration of the adequacy of the commissioner's appeal statement for the purposes of order 52b, rule 5(2)(a)(iv) taxation practice and procedure |
The primary issue raised on the appeal is whether the MRT erred in law by determining the appellant's case on the basis that he carried a persuasive burden of proof. There is also a secondary issue as to whether the MRT's decision could have been different, in any event, having regard to the requirements of the Migration Regulations 1994 (Cth) ("the Regulations "). That secondary issue relates essentially to what relief, if any, the appellant may be entitled to even if he succeeds on his primary ground. He arrived in Australia on 13 April 1997 on a student visa that was valid until 15 March 1998. He was granted a further student visa valid until 7 May 2000. 3 On 28 February 1999, the appellant married Nola Khan, an Australian citizen ("the nominator"). On 12 April 1999, he lodged an application for a Class TK Extended Eligibility (Temporary) subclass 820 (spouse) visa ("the spouse visa"). The appellant and the nominator were both interviewed by a Departmental officer on 22 June 1999. On 29 June 1999, the nominator withdrew her support for the application on the basis that the relationship had ended. 4 The appellant then sought to rely upon the domestic violence exception contained in Div 1.5 of the Regulations . That exception enables an applicant for a spouse visa who is no longer living in a continuing relationship with his or her spouse at the time of the visa decision to maintain the claim for that visa. 5 On 30 April 2002, the respondent Minister's delegate refused the application on various grounds. These included a finding that the relationship had not been genuine at the time of application, and a further finding that the requirements of reg 1.26, dealing with statutory declarations by "competent persons", had not been met. 6 On 27 May 2002, the appellant applied to the MRT for review of the delegate's decision. On 16 June 2004, the MRT affirmed that decision. The appellant then sought review of the MRT's decision in the Federal Magistrates Court. On 23 November 2004, that application was dismissed. On 9 December 2004, a notice of appeal was filed, it appears by the appellant in person. Subsequently, I directed that the appellant be referred to the Registrar for referral to a legal practitioner for pro bono assistance. That was done. On 18 April 2005, the appellant filed detailed contentions that were prepared by counsel. The respondent filed contentions in reply on 17 May 2005. At that time, he was living and studying in Victoria. They remained in touch, and the appellant eventually moved to Perth in about August 1998. They commenced living together in about January 1999, and were married on 28 February 1999. 8 The MRT found that the relationship between the appellant and the nominator swiftly deteriorated. The appellant submitted a statement to the MRT in which he outlined the circumstances of the breakdown of the relationship. He claimed, inter alia, that the nominator had become "aggressive" and "violently abusive", and recounted three incidents which took place in March, May and June 1999. In the May incident (actually 24 May 1999), the nominator badly damaged two cars owned by the appellant, which led to him moving out of her house for several days. In the June 1999 incident, the nominator threatened him with a knife. After that incident, the appellant moved out permanently. Other than the evidence of the Applicant, there is no independent reliable evidence attesting to the state of the relationship from family or friends. Whilst the Tribunal is satisfied that the Applicant and Ms Khan may have shared some form of a relationship after the Applicant's move to Perth in or around September 1998 and when the marriage broke up at the end of June 1999 the Tribunal finds that the relationship falls short of a genuine and continuing married relationship as required by law. It would be fair to described [sic] as lacking the evidence relating to indices of such a relationship as set out regulation 1.15A of the Regulations . When considering the question of burden of proof in administrative review, the Tribunal is guided by various Administrative Appeals Tribunal ('AAT') [sic] and the Federal Court on the subject. Whilst acknowledging that an administrative tribunal should not 'seek to determine matters ... by strict application of the rules related to onus of proof', Senior Member Ballard in Re Caruana and Australian Telecommunications Commission (1982) 5ALN N30 nevertheless said that 'regard must be had to the application of those rules ... in determining which party has the responsibility of satisfying the Tribunal as to any given fact '. (See also Re Elkington and Minister for Immigration and Ethnic Affairs (1982) 5 ALN N196). Such proof must make possible a finding, from the whole of the evidence and on the balance of probabilities, of the facts that are fundamental to a claim. In McDonald v Director-General of Social Security (1984) 6 ALD 6, the Federal Court was again anxious to avoid the onus terminology. The result flowing from the Court's dicta however does not appear to be much different from that raised by the decisions referred to above. When the whole of the evidence has been considered against the statutory requirements and the Tribunal is left in a state of uncertainty as to whether the facts necessary to activate the relevant statutory power have been established it must decide against the exercise of the power. The Tribunal finds that the Applicant has not discharged the 'common sense' burden of establishing the facts necessary to enable the Tribunal to reach a finding on the critical issue. The Tribunal is unable to reach a finding that the Applicant was the spouse of Ms Khan at the time of lodgement of the primary application . However, in the event that it was wrong in its finding that the appellant was not in a spouse relationship at the time of lodgement of the primary application, and given that it was common ground that the relationship between the appellant and the nominator had ended, it would assess whether he had suffered domestic violence committed by the nominator, pursuant to cl 820.221(3)(b) of Sch 2 of the Regulations . 11 After setting out in detail the "special provisions relating to domestic violence" found in Div 1.5, the MRT noted that they formed the evidentiary framework within which domestic violence was deemed to have occurred. Regulation 1.23 defined domestic violence, and set out the circumstances in which a person was to be taken to have suffered such domestic violence. 12 The MRT noted that the provisions of Div 1 had been extensively considered by the Federal Court, and that the Division had been described variously as "a deeming mechanism": Meroka v Minister for Immigration and Multicultural Affairs [2002] FCA 482 ; (2002) 117 FCR 251 (" Meroka ") at [5]; a "triumph of form over substance": Ibrahim v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 1279 (" Ibrahim ") at [40]; and as a "mechanical mode of proof": Cakmak v Minister for Immigration & Multicultural Affairs [2003] FCA 503 at [40] . 13 The MRT then stated that it was established law that it was not its role, nor that of any decision maker, to assess whether domestic violence had taken place. In the words of Ryan J in Kozel v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 658 ; (2004) 138 FCR 181 (" Kozel "), it was "the Tribunal's responsibility to assess whether statutory declarations have been furnished which express the opinions mandated by reg 1.26". 17 In addition, the MRT found that two police reports, in relation to the May 1999 incident, did not meet the requirements of reg 1.24(1)(a)(ii) because they were not records of an assault on the alleged victim, allegedly committed by the alleged perpetrator. It only referred to certain alleged acts of damage to property. The criterion described under cl 820.221(3)(b) was not met. Indeed, his Honour noted that the Minister had acknowledged that the MRT's use of this terminology may have been "inappropriate". Although in paragraph 40 of its decision the MRT states it is "unable to reach a finding that the applicant was the spouse of Ms Khan at the time of lodgement of the primary application", it did so, unfortunately, in the context of that same paragraph where it referred to the "commonsense burden of establishing the facts". Although that is an unfortunate occurrence in terms of the reasoning and the manner in which the MRT has expressed its findings, I am not prepared to conclude that it has in reality done anything more than indicate that it was not satisfied that the appropriate relationship existed as required by law. Indeed, it may simply be that the MRT was grappling with the concept of burden of proof against the backdrop of correctly reciting appropriate authorities where it is clear that the application of the rules related to onus of proof are not appropriate for the tribunal and where it is clear that in all the circumstances the MRT had after reciting the arguments advanced on behalf of the applicant who was represented simply made appropriate findings that it was not satisfied in relation to the key issue to be resolved, namely whether or not the applicant and the nominator were in a relationship of a kind required by law for the purposes of the visa application. It had after all considered the statutory declarations and other material before it and did so in the course of its reasoning as required. These additional grounds challenged the MRT's findings regarding the statutory declarations and the police reports. They contended that the MRT had erred in failing to be satisfied that the domestic violence exception was made out. These are set out at length at [7] of the Federal Magistrate's reasons for judgment, and it is unnecessary to replicate them here. 23 It is sufficient, for present purposes, to note that cl 820.211(2)(a) of Sch 2 requires that, at the time of application (in this case 12 April 1999), the applicant must be the spouse of an Australian citizen, an Australian permanent resident, or an eligible New Zealand citizen. Under reg 1.15A, a person is the "spouse" of another person if the two persons are in a married relationship within the meaning of sub-reg (1A). They must be married to each other under a valid marriage, and the Minister must be satisfied that they have a mutual commitment to a shared life as husband and wife to the exclusion of all others, the relationship is genuine and continuing, and that they live together, or do not live separately and apart, on a permanent basis. 24 In forming an opinion as to whether the two persons are in a married relationship, the Minister must have regard to all of the circumstances of the relationship including, in particular, the matters prescribed by reg 1.15A(3) relating to the financial aspects of the relationship, the nature of the household, the social aspects of the relationship, and the nature of their respective commitment to each other. 25 Mr Horan submitted that, in the present case, the MRT had been required to make a finding as to whether the appellant was relevantly the "spouse" of the nominator within the meaning of reg 1.15A. That, in turn, required the MRT to make a finding as to whether their relationship was genuine and continuing, as at the time of application, and in doing so to take into account the matters set out in reg 1.15A(3). 26 Mr Horan submitted that the MRT did not make a finding, on the evidence, as to these matters. It simply concluded that, in the absence of "reliable" evidence, it was unable to "reach a finding on the critical issue", as expressed in [40] of its reasons for decision. He submitted that when the MRT's reasons for decision were read as a whole, it was apparent that it had impermissibly imposed a burden of proof upon the appellant, and thereby committed jurisdictional error. 27 In developing that submission, Mr Horan argued that the concept of onus of proof has no place in administrative proceedings, such as those conducted by the MRT. He referred to McDonald v Director-General of Social Security (1984) 1 FCR 354 (" McDonald ") at 356-7 per Woodward J, 365-6 per Northrop J and 369 per Jenkinson J; Minister for Immigration and Multicultural Affairs v Hughes [1999] FCA 325 ; (1999) 86 FCR 567 at [35] per Merkel J, with whom Carr J agreed; and Bushell v Repatriation Commission [1992] HCA 47 ; (1992) 175 CLR 408 at 424-5 per Brennan J. He submitted that such proceedings are not adversarial in nature. The MRT is an inquisitorial body which has powers to make inquiries and to obtain additional information. It is not a curial body that decides cases in accordance with principles of evidence, or by determining the incidence of the burden of proof. 28 Mr Horan argued that when the MRT asserted that there was "no reliable evidence... regarding the pooling of financial resources or the sharing of household expenses" or "the domestic and social aspects of the relationship" and "no independent reliable evidence attesting to the state of relationship from family or friends", it was essentially determining the issue before it, not on the basis of the evidence as it stood, but rather on the basis of the absence of evidence that might have been presented. Indeed, the MRT, at [36] of its reasons for decision, described the position presented to it as "lacking the evidence relating to the indices of such a [genuine and continuing] relationship as set out [in] regulation 1.15A of the Regulations ". 29 Mr Horan supported this argument by noting that the MRT did not, explicitly, reject the appellant's evidence regarding his relationship with the nominator. Indeed, it stated, at [36], that it was "satisfied that the Applicant and Ms Khan may have shared some form of a relationship after the Applicant's move to Perth in or around September 1998". In Mr Horan's submission, it was simply the lack of independent, reliable evidence that led the MRT to reject the appellant's claim, and that was essentially because he had not discharged the onus that the MRT had wrongly required him to carry. 30 Mr Horan recognised that the MRT had expressly acknowledged at [37] of its reasons for decision that it should not "seek to determine matters ... by strict application of the rules related to onus of proof", and had cited authority for that proposition. He noted, however, that that statement, which was itself unexceptionable, was immediately followed by the various references to onus of proof, or burden of proof, set out at [37] and [38] of the reasons for decision. He submitted that the MRT's belief that the Full Court's admonition in McDonald to avoid such terminology could be reconciled with the very different approach taken in Re Elkington and Minister for Immigration and Ethnic Affairs (1982) 5 ALN N196 and Ladic v Capital Territory Health Commission (1982) 5 ALN N60, the cases to which the MRT referred, indicated that it had not understood the full significance of what the Full Court had said upon this subject. 31 Finally, Mr Horan submitted that irrespective of whether the MRT had, at one point, formulated the law correctly when it stated that an administrative tribunal should not determine matters by applying the rules relating to onus of proof, it had plainly gone badly wrong by what it ultimately said in [40]. At [40], the MRT's reasons were to the effect that the appellant had failed because he had not "discharged the 'common sense' burden" that rested upon him to establish the facts necessary to enable the MRT to reach a finding on the critical issue. He noted that the MRT had not gone on to say that it was not satisfied that the appellant was the spouse of the nominator at the time of lodgement of the primary application, but had merely stated that it was "unable to reach a finding" on that point. He submitted that, couched in those terms, it was clear that the MRT had, improperly, imposed upon the appellant a persuasive burden of proof. This, he submitted, amounted to jurisdictional error. 32 Mr Horan referred to, and relied upon, what he submitted was an analogous case, Huang v Minister for Immigration & Multicultural Affairs [2001] FCA 901 (" Huang ") at [21]-[26]. In that case, Drummond J set aside a decision of the Immigration Review Tribunal ("the IRT") (the predecessor to the MRT) the reasoning of which had been in very similar terms to that of the MRT in the present case. Mr Horan submitted that, contrary to the judgment of the Federal Magistrate below, the MRT's finding in this case was tainted by its failure properly to grasp the principles applicable to administrative proceedings, at least in relation to matters such as the incidence of the burden of proof. 33 In Huang , the question that arose for determination was whether the IRT's comments, in its reasons for decision, indicated that it had disposed of the case against the applicant by deliberately refraining from making findings on relevant matters. It was said to have done so because it considered that the responsibility for clarifying the relevant facts rested with the applicant, and she had failed to discharge the onus she bore in that regard. If the Tribunal is uncertain or unable, on balance, to find whether the facts exist to entitle the Applicant to the visa sought, a decision is to be made against her (see Re Ferreras , IRT Decision 299, 2 September 1991). Before the decision-maker (whether that be the Minister, his delegate or the Tribunal) is entitled to grant a visa of the kind sought by the applicant, the decision-maker must be satisfied, among other things, that the other criteria (ie, other than the health criteria) for the visa in question that are prescribed by this Act or the Regulations have been satisfied: see s 65(1)(a)(ii). It was then submitted that all the Tribunal did by making the comments in par [25] was acknowledge that the task for it in determining whether to grant the applicant her student visa in accordance with s 65(1)(a)(ii) was to determine whether, at the end of the day, it was satisfied that criterion 560.213 was complied with, which required it to be satisfied that condition 8202 was substantially complied with. It was said that par [25] should not be read as a statement by the Tribunal that it approached the case on the basis that the applicant must fail unless she discharged the persuasive burden of proving to the civil standard of proof the facts necessary to show that this particular criterion and this condition had been complied with, ie, the facts necessary to show that she was entitled to the visa she sought. See McDonald v Director-General of Social Security (1984) 1 FCR 354 at 356 - 357, 366 and 369; Cam v Minister for Immigration and Multicultural Affairs (1998) 84 FCR 14 and cf Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259 at 282 - 283. (To say that notions of onus of proof are irrelevant is not, however, to say that it is not in some circumstances appropriate for the Tribunal to have regard to common law standards of proof, as opposed to the incidence of the burden of proof, and to reach conclusions of fact on some matters only if satisfied as to the existence of those facts "on the balance of probabilities arising from the available information before the decision-maker". See Minister for Immigration and Multicultural Affairs v Epeabaka [1999] FCA 1 ; (1999) 84 FCR 411 at 417 - 420. I was reminded that the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon judicial review by over-zealously seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed: Wu Shan Liang at 272. This principle of judicial restraint applies to all reviewable administrative decisions including those of the Tribunal. But it does not, I think, apply in the same way to all such decisions. The rigour with which it constrains a court in examining a decision-maker's reasons will reflect the nature and role of the particular decision-maker. Members of the Migration Review Tribunal perform a significantly different function from public servants in the mainstream of federal executive activity who, from time to time, are called upon to make administrative decisions as part of a range of duties conferred on them. The Tribunal is a specialist decision-maker charged with reviewing lower-level administrative decisions. The obligation imposed by s 368 of the Migration Act 1958 (Cth) to provide in written form both reasons and findings, in the context of its decisions being subject to judicial review, shows that the Parliament expects the Tribunal to be capable of giving a coherent and informative explanation for how it reaches its ultimate conclusion for or against an applicant. The principle of restraint is one that cautions against too zealous a search for error. It is not a principle that immunises the Tribunal's reasoning from that critical examination which is part and parcel of the function of a court charged with review of the Tribunal's decision to see if it is flawed with reviewable error of the kinds listed in s 476 of the Act. Such proof must make possible a finding, from the whole of the evidence and on the balance of probabilities, of the facts that are fundamental to a claim. When the whole of the evidence has been considered against the statutory requirements and a Tribunal is left in a state of uncertainty as to whether the facts necessary to activate the relevant statutory power have been established it must decide against the exercise of the power. In the context of the instant case if having carefully considered the whole of the evidence, the picture is still unclear as to whether there exists an intention to make a 'genuine' visit such that the Tribunal on the balance of probabilities is not able to make a finding in this regard then the criterion has not been satisfied and the application for the visa must fail. For the reasons given, such an approach is wrong. But having referred to Re Ferreras , it may well be that it followed the erroneous approach suggested in that case and regarded the applicant as bearing the persuasive burden of proof to the civil standard of all facts necessary to enable the Tribunal to determine whether it was satisfied that the applicant was entitled to the student visa in question. The Tribunal impermissibly imposed on the appellant a persuasive burden in relation to establishing that his relationship with the nominator was genuine and continuing at the time of application. The reference by the Tribunal to "the 'common sense' burden of establishing facts" was more than simply "unfortunate". It is an indication of serious error made by the Tribunal in performing the task entrusted to it. He recognised that it would be submitted that even if the MRT had fallen into the error identified, it had correctly found that the appellant could not meet the criteria to be satisfied at the time of the decision, under cl 820.221 of Sch 2, which require an applicant for a spouse visa to continue to meet the requirements of the applicable subclause, unless a relevant exception exists. The only relevant exception that could be invoked was that relating to domestic violence. The Minister could be expected to submit that it would be futile to remit this matter to the MRT for rehearing, given that its findings regarding the statutory declarations and the police records were unassailable. In other words, the appellant's application was certain to be rejected because it could not meet the requirements of reg 1.26 and reg 1.24(2)(a)(ii). 39 As previously indicated, the Federal Magistrate did not consider any of the grounds of appeal that related to the statutory declarations and police records. That was because his Honour found no error on the MRT's part in relation to the burden of proof, and that put an end to the appellant's case. 40 Mr Horan submitted that if the MRT did err by improperly imposing upon the appellant the burden of proof to establish that his relationship with the nominator was genuine and continuing, at the time of the application, the matter should be remitted to the MRT to be heard and determined according to law. He submitted that it would not be futile to remit the matter because the MRT, acting correctly, might well conclude that the requirements regarding the statutory declarations and the police records had been met. 41 In that regard, Mr Horan noted that the relevant provisions of the Regulations , and in particular cl 820.221(3) of Sch 2, created an exception to the general requirement that, in order to satisfy the criteria for the grant of a sub-class 820 visa, the applicant must be the "spouse" of the nominator at the time of decision. Normally, this must be at least two years after the date of application. 42 An applicant will meet the requirements of cl 820.221(3) if the marital relationship is no longer continuing, and, relevantly, "the applicant ... has suffered domestic violence committed by the nominating spouse": see cl 100.221(4)(c)(i). A reference to a person having suffered, or committed, domestic violence is a reference to a person being taken under reg 1.23 to have suffered or committed such violence. Relevantly, reg 1.23(g) provides that an alleged victim is taken to have suffered domestic violence committed by an alleged perpetrator if the alleged victim presents evidence that meets the requirements of reg 1.24. That expression includes a medical practitioner, and a social worker. 46 As previously indicated, the MRT found that the statutory declarations of Dr Van Dort and Ms Fraser did not satisfy the requirements of reg 1.26. It will be necessary, therefore, in order to understand Mr Horan's submissions, to turn to those documents in some detail. 47 Dr Van Dort made his statutory declaration on 12 August 1999. He stated that on 28 June 1999, he had attended a man who identified himself as the appellant. The man related having problems with his wife, an Aboriginal lady with an alcohol problem. He stated that when under the influence of alcohol, which was most of the time, she was violent towards him, and to his property. He said that he had reported the matter to the police, and showed Dr Van Dort a police report. He also showed Dr Van Dort photographs of two cars which showed the windows and front and rear windscreens damaged. The man was distressed, and Dr Van Dort felt that he was depressed. He prescribed medication. Prior to that visit, Dr Van Dort had never met the appellant. In his own words, "the history is wholly as he related it to me". 48 Mr Horan submitted that it was "implicit" in Dr Van Dort's statutory declaration that he was of the opinion that the appellant had suffered domestic violence, and that the nominator had committed that violence. 49 Ms Fraser made two statutory declarations. The first on 9 August 1999, and the second on 12 December 2003. 50 In the first statutory declaration she stated that she had seen the appellant, in her capacity as a counsellor at the Curtin University Counselling Services on 5 July 1999. Mr Ejueyitsi had presented her with a written referral from Dr Van Dort requesting that the University Counselling Services provide "counselling and guidance". Mr Ejueyitsi claimed to have been subjected to physical and emotional abuse by his wife Nola. There were other more general comments made by him with respect to Nola's behaviour. I further confirm that in seeing Mr Ejueyitsi on referral and in providing my previous declaration I was performing the duties of a social worker. He submitted that in considering whether a statutory declaration contains the requisite opinion, it must be read fairly, and should not be "scrutinised over-zealously with a view to detecting some inadequacy of expression from which error may be imputed": see Kozel at [30] per Ryan J. He submitted that in many, if not most, cases, the competent person would have no direct knowledge of the applicant's relationship with his or her spouse, and would therefore be in no position to do other than recount the history given by that person. Even if there were objective signs of violence having been inflicted, it would be difficult for a doctor, or a social worker, to proffer an opinion that the injuries in question had been inflicted in the course of domestic violence, still less that a particular person had inflicted them. He submitted that the Regulations should be construed benevolently, having regard to their evident purpose, which was to allow persons who had been subjected to domestic violence, and forced to live apart, to maintain a claim for a spouse visa. He further submitted that the Regulations should not be construed so as to require the competent person to act as an investigative, or fact finding body, a task which many such persons would either eschew, or not be qualified to undertake. 53 In that regard, Mr Horan submitted that Dr Van Dort, in his statutory declaration, had stated that he had been given an account of the domestic violence suffered by the appellant, and committed by the nominator, and that he had been shown corroborating evidence in the form of police reports and photographs. It was in that context that Dr Van Dort stated that the appellant "was distressed and I feel that he was depressed". In those circumstances, Mr Horan submitted, it was by no means difficult to infer that Dr Van Dort was stating an opinion that the appellant had suffered domestic violence, as required by reg 1.26, and that he held the opinion that this had been inflicted by the nominator. The same could be said of Ms Fraser's statutory declarations. 54 Mr Horan noted that the conduct of the nominator, as described by the appellant, was capable of amounting to domestic violence within the meaning of the Regulations . It involved violence against the appellant's property, and at least the implicit threat of violence against him. It must have caused him to fear for, or to be apprehensive about, his personal well-being or safety. 55 Mr Horan submitted that, in the event that only one of the statutory declarations met the relevant requirements, the MRT erred in finding that the police records (consisting of a computer system despatch extract, and a handwritten action report) did not fall within reg 1.24(a)(2) because those records did not refer to any assault upon the appellant. 56 The computer system despatch extract refers to a complaint on 24 May 1999 at 2.13am. It is brief in the extreme. It merely states that the complainant "was woken by his [redacted] with a knife in [redacted] hand". It goes on to say that someone, or something (the letters "APP" appear), "has caused a lot of damage at the house and that the complainant ran out and rang from a phone box". 57 Although words have been redacted from the copy of the computer system despatch extract, obtained under freedom of information legislation, Mr Horan submitted that it could readily be inferred that the complaint was about the nominator. That conclusion was said to be open on the basis that the incident had occurred in the home at 2.13am. Moreover, there appeared to be no record, on the document, of any follow up investigation, a common characteristic of complaints involving domestic violence. Mr Horan submitted that, on any view, the concept of an assault extends to conduct which causes a person to fear physical violence. An attack upon two vehicles which causes substantial damage, in the presence, actual or constructive, of the appellant, could, on that basis, constitute an implied threat, and therefore an assault at common law. 58 The handwritten action report described the steps taken by the police who attended at the premises in the early hours of 24 May 1999. The report said that the police spoke to the appellant and his wife "who had been arguing over an alleged affair and decided to separate". It said that the wife had damaged two vehicles prior to their arrival. It recorded that the appellant had collected some of his property, and then proceeded to drive to a friend's house. 59 Mr Horan submitted that if either the computer system despatch extract, or the action report, did in fact fall within reg 1.24(1)(a)(ii), there would only need to be one statutory declaration from a competent person in order to satisfy 1.24(1)(a). She submitted that the appellant could not succeed in the appeal to this Court on that basis alone, and that it would also be necessary to show that "the court below, and the Tribunal, erred in relation to the statutory declarations and police records". 61 Ms Riley noted that the Federal Magistrate had expressly refrained from considering the correctness or otherwise of the MRT's findings regarding the statutory declarations, and the police records. She submitted that his Honour had rightly refrained from dealing with these matters, having regard to his conclusion that the MRT had not erred in relation to the issue of burden of proof. 62 It may be interpolated, at this point, that it is difficult to see how the appellant could sensibly be expected to include, in his notice of appeal to this Court, a challenge to anything that his Honour did in relation to the statutory declarations and police records. All that his Honour determined was that it was not necessary to say anything about the MRT's reasoning regarding these matters. 63 This Court exercises appellate functions over the Federal Magistrates Court. In order to succeed on an appeal, an appellant must demonstrate error on the part of the court below. The only "error", that can conceivably be discerned in his Honour's treatment of the grounds of review concerning the statutory declarations and police records was his failure to determine the burden of proof ground in favour of the appellant. That, in turn, would have required his Honour to consider the remaining grounds of review. 64 In any event, Ms Riley submitted that in order to enable the appellant to deal with the correctness or otherwise of the MRT's findings regarding the statutory declarations and police records on this appeal, Mr Horan ought to seek leave to file an amended notice of appeal. She added that the Minister would not oppose such leave being granted. 65 On the primary point of substance, Ms Riley submitted that the MRT had made its finding that the appellant had not been in a genuine and continuing spousal relationship at the time of the application without impermissibly imposing any burden of proof upon him. 66 Ms Riley accepted that the notion of proof, as understood in a curial sense, has no role to play in an administrative decision in which the decision maker is asked to be satisfied of a certain matter. However, she submitted that it was also true, as a matter of practical reality, that the decision maker would not be able to be satisfied of a particular matter if there was no evidence, or other material, regarding an important issue, before the decision maker. She referred, in that regard, to Minister for Immigration and Multicultural and Indigenous Affairs v VSAF of 2003 [2005] FCAFC 73 (" VSAF "), a case in which the applicant had not attended before the Refugee Review Tribunal. In that case, the Full Court saw no error in the Tribunal having proceeded to make its decision without taking any further steps to enable him to attend. The absence of any evidence in support of the applicant's claim enabled the Tribunal to find that it was unable to be satisfied that he had a genuine fear of persecution, or that he had experienced any particular mistreatment or harm. 67 Ms Riley submitted that, in the present case, the MRT's reference to the "common sense" burden, in [40] of its reasons for decision, meant no more than that it could not be satisfied, in the absence of sufficient evidence, that the appellant and the nominator were in a genuine and continuing spousal relationship. It did not mean that the MRT had decided the case on the basis of some failure to discharge a curial onus of proof. 68 In that regard, Ms Riley sought comfort in the well-known passage from the judgment of the High Court in Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259 at 272. 69 Ms Riley noted that, at [37] of its reasons, the MRT had correctly acknowledged that an administrative tribunal should not seek to determine matters by the application of the rules related to burden of proof. She submitted, however, that where an applicant asks the MRT to be satisfied about an aspect of his personal situation, in circumstances where the MRT is under no obligation to seek out material for itself, and there is no opposing party, the only realistic source of material upon which the MRT can achieve the required state of satisfaction is the applicant himself. As s 65 and Wu Shan Liang make clear, the section requires a visa to be rejected in the absence of a positive finding of satisfaction. It does not require the visa to be granted in the absence of an adverse finding. There are many cases showing that findings of fact are not necessarily required to support a state of non-satisfaction. In SJSB v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 225 the Tribunal found that the applicant's claims were at "such a general and vague level that the Tribunal cannot establish the relevant facts", and therefore had made no findings either accepting or rejecting the claims. Rather, it requires a refusal if the decision-maker is not affirmatively satisfied that the criteria for the visa in question have been satisfied. She submitted that in the present case, the MRT, though satisfied that the appellant and nominator had "some form of relationship", expressly stated that it was not satisfied that they had been in a genuine and continuing relationship at the time of the application. She submitted that there was nothing in the MRT's reasoning on this issue that suggested it had misunderstood its statutory task. On the material, it was open to the MRT to arrive at the conclusion that it did. 72 Ms Riley recognised that she might be in some difficulty with regard to the burden of proof issue. She frankly acknowledged that the MRT's language had been unfortunate, and that it had been unwise to speak of the appellant having not discharged the "common sense burden" of establishing the facts necessary to enable it to reach a finding on the critical issue. However, she submitted that when the MRT used this terminology, it had merely expressed itself infelicitously, and had done no more than what VSAF expressly contemplated and approved. 73 With regard to the statutory declarations, Ms Riley submitted that there was nothing implicit in them that suggested that the competent person held the opinions required under reg 1.26. She referred to Ibrahim at [40] where Wilcox J observed that if the visa applicant fails to obtain appropriate statutory declarations by the required two competent persons, the visa application has to be refused. That is so even if the decision maker is totally satisfied that the applicant has suffered domestic violence at the hands of his or her spouse. It is not sufficient compliance, in my view, with these Regulations for a competent person simply to note the consistency between a person's presentation and their account of domestic violence, or even the occurrence of domestic violence. The Regulations require that the competent person express an opinion in very specific terms, namely, as to whether relevant domestic violence as defined in reg 1.23 has been suffered by a person. None of this has been complied with here. His Honour said, at [12], that the statutory declarations under consideration in Alin did not satisfy the Regulations because they made "no reference to the applicant's state of mind, namely that the violence caused the applicant to fear for or be apprehensive about his personal well-being or safety", that being a component of the definition of "relevant domestic violence" in reg 1.23(2)(b). The requisite statement of opinion may be conveyed by implication having regard to the way in which the standard form directs the attention of the competent person to the definition of "domestic violence" in reg 1.23(2)(b). Where the standard form was not used, it was necessary, in Sundberg J's view, for the requisite opinion to be expressly stated. Ms Riley noted that the standard form had not been used in the present case. 78 In these circumstances, and relying upon both Du and Alin , Ms Riley submitted that even an implicit expression of opinion, of the kind for which Mr Horan contended, would not be sufficient. The requisite opinion would have to be clearly expressed. 79 However, Ms Riley went further and submitted that even on a generous view, the requisite opinion was not implicit in any of the statutory declarations relied upon by Mr Horan. Dr Van Dort merely considered that the appellant was depressed, and he prescribed medication for that condition. However, he did not offer any opinion, express or implied, as to what had caused that depression. More specifically, he did not express any opinion to the effect that the appellant had suffered domestic violence at the hands of the nominator. 80 Likewise, Ms Fraser simply recounted what she had been told by the appellant. At no stage did she indicate that she believed what he said to be true. Nor did she indicate that she had formed a professional opinion that he had been the victim of domestic violence that had caused him to be fearful for his well-being or safety, still less that this violence had been committed by the nominator. 81 Finally, Ms Riley submitted that neither of the police records described what could be regarded as an assault upon the appellant. The first record was merely a despatch record. It said nothing about his having been assaulted. The second record said that there had been an argument over an alleged affair, and that the nominator had damaged two vehicles. It did not indicate that the appellant had been attacked, or even put in fear of being attacked. Indeed, Ms Riley went so far as to submit that there was no indication that the damage inflicted upon the vehicles was deliberate, or done in the appellant's presence. She submitted that there was nothing to indicate that anything that took place might have left the appellant feeling in any way threatened. Indeed, in both cases, the relevant tribunal adopted precisely the same formulation of the law governing the burden of proof in administrative review: see Huang at [22], and compare [38] of the MRT's reasons for decision. 83 Ms Riley submitted that Huang did not decide, as a matter of ratio, that the language used by the IRT in that case demonstrated that it had determined the case erroneously, on the basis that the applicant carried a persuasive burden of proof. That was because Drummond J went on to find that the IRT's reasons for decision were also erroneous in other respects, and his Honour did not specifically state that the application for review, that was granted, was allowed on the basis of a mistaken allocation of the burden of proof. 84 I am not persuaded by this submission. Drummond J made it abundantly clear, in Huang , when he concluded that there was reviewable error under s 476 of the Migration Act 1958 (Cth), that the IRT's entire approach to the burden of proof was misconceived. The fact that his Honour found several additional errors in the IRT's reasons for decision, any one of which would have been sufficient to vitiate that decision, does not mean that what he had to say about its treatment of the burden of proof amounted to mere dicta. 85 In any event, even if Drummond J's observations were dicta, they were certainly carefully reasoned, and are worthy of serious consideration. The principle of comity would suggest that I should follow his Honour's analysis unless persuaded that it was wrong. Far from being so persuaded, I consider what his Honour said to have been correct. 86 Ms Riley then submitted that there was an inconsistency between Huang and VSAF . If that were so, I would plainly be bound by VSAF , that being a decision of the Full Court. However, in my view, there is no such inconsistency. In the present case, the MRT analysed the evidence before it through the prism of the burden of proof. In VSAF , there simply was no evidence upon which the MRT could be satisfied of the requisite matters. 87 Of course, the MRT in this case had to be satisfied of the various matters set out in the Regulations before it could grant the appellant the spouse visa that he sought. However, it is one thing to recognise that a statute requires that a state of satisfaction be reached. It is altogether another thing to approach the question whether such satisfaction has been achieved by asking whether an onus of proof has been discharged. The latter reflects an approach that is curial, rather than inquisitorial. As Huang makes plain, a decision maker who adopts such a curial approach asks the wrong question. 88 Ms Riley's submission that Wu Shan Liang should be invoked to salvage the MRT's decision, despite its "unfortunate" use of language, has a powerful resonance. There are many cases, where decisions by administrative tribunals have been affirmed, despite lapses in the language used when addressing matters of "proof". However, a great deal must depend upon the particular circumstances of any given case. Some cases will cross the line, and irredeemably reveal jurisdictional error. 89 In my view, the observations of Drummond J at [20] in Huang regarding Wu Shan Liang apply with equal force to the present case. The MRT was plainly confused about the distinction between the onus of proof in curial proceedings, and how a decision maker determines facts in administrative review. That confusion was most clearly manifested by its discussion at [40] of its reasons for decision. The reference to "common sense" (which is in fact a term used to explain the axiom that "he who asserts must prove", in a curial context), was invoked by the MRT, mistakenly, to explain, and justify, a finding made in an entirely different, and purely administrative context. 90 The MRT's role in satisfying itself as to various matters has nothing whatever to do with a "common sense" burden of establishing the facts necessary to enable it to reach a finding on "the critical issue". There is no such burden, whether derived from "common sense", or anywhere else. The only statutory requirement is that the MRT satisfy itself of the requisite matters. 91 Subject to what VSAF had to say regarding the meaning of the term "satisfy" (in the context of a proceeding in which the applicant did not attend the hearing that had been arranged so that he could present his case, and therefore put no material to the relevant tribunal in support of that case), it is plainly wrong for a decision maker to approach an application for merits review by considering whether a persuasive burden of proof has been discharged. 92 I should add that I do not understand the MRT, in the paragraphs that are impugned, to have been endeavouring, in an incomplete way, to distinguish between a legal and evidential burden of proof. Nor do I understand it to have embarked upon an analysis grounded in the mysteries of presumptions of law and fact, and any differences that arise between them. Its error was more fundamental than that, and simply reflected confusion on its part as to how the process of administrative review was to be conducted. 93 It follows that I disagree, with respect, with the learned Federal Magistrate who concluded that the MRT's decision, though somewhat confused, could nonetheless be saved by application of the principles set out in Wu Shan Liang . His Honour did not have the benefit, as I did, of being referred to the judgment of Drummond J in Huang . Had that case been drawn to his attention, he may well have come to a different conclusion. I would therefore uphold the various grounds of appeal that raise the MRT's treatment of the burden of proof as the basis for challenge. 94 However, that of itself does not mean that the appeal must succeed. There is still the question whether it would be futile to remit this matter to the MRT (which is the relief for which the appellant primarily contends), or alternatively to the Federal Magistrates Court to complete its consideration of the grounds of review that were not dealt with. 95 The issue of futility arises because, as the Minister quite properly notes, the evidence makes it clear that whatever may have been the position at the time the application for a spouse visa was lodged, by the time of the MRT's decision, the appellant and the nominator were not in a genuine and continuing spousal relationship. That meant that the appellant would have to bring himself within the domestic violence exception in Div 1.5 of the Regulations . According to Ms Riley, he could not do so because, as the MRT correctly found, he did not meet the requirements of the Regulations regarding statutory declarations, and police records. 96 If I were satisfied that the appellant could not conceivably bring himself within the domestic violence exception, having regard to the MRT's findings in relation to the evidence regarding this matter, I would deny relief in the exercise of my discretion. However, I am not so satisfied. 97 In the first place, the appellant sought review, in the Federal Magistrates Court, of the MRT's decision, not just in relation to its treatment of the burden of proof, but also in relation to its findings regarding the statutory declarations and police records. For reasons that have already been explained, that process of review was never completed in relation to these matters. 98 Ms Riley submitted that this Court was in as good a position as the Federal Magistrates Court had been to determine whether there was any merit in the appellant's submissions regarding the statutory declarations and police records. In one sense, that is true. The issues raised are essentially questions of law. However, it is important to bear in mind that those issues are not actually before this Court. There is nothing in the notice of appeal that challenges the findings of the MRT regarding these matters, and the Federal Magistrate did not deal with them. The only basis upon which they have been agitated before me is in anticipation of an argument by the Minister that it would be futile to remit this case, and accordingly, that relief should be refused in the exercise of the Court's discretion. 99 I am unable to accept Ms Riley's submission that the appellant cannot conceivably bring himself within the domestic violence exception. Indeed, it seems to me that in at least one respect, namely Mr Horan's submission regarding the police records, the appellant has an eminently arguable case. I find it difficult to understand how the MRT could have concluded that the police records, whether viewed separately, or in conjunction with each other, did not contain a report of an assault. If pressed, I would infer that the MRT may have adopted too narrow a view of what constitutes an assault. In any event, it seems to me, without saying more, that this aspect of the appellant's case is anything but hopeless. 100 The appellant's submissions regarding the statutory declarations obviously face significant hurdles. Nonetheless, an argument can be put to the effect that the MRT erred in its treatment of this issue. Much will depend upon whether the approach taken by Ryan J in Meroka , which recognises the possibility that a statutory declaration may state an opinion "implicitly", is good law. 101 In particular, the question may arise as to whether the distinction that Sundberg J drew in Alin between a statutory declaration on a form approved by the Department, which may contain implicit statements of opinions, and a declaration not in that form, which may not, is correct. It is fair to say that Sundberg J referred to the difference between the form used in Meroka , and that used in Alin , as a basis for distinguishing Meroka . However, his Honour did not explain, in any detail, why the difference in the form of the declarations used warranted a different result, at least in terms of whether an opinion could be "implicit". It is arguable that the broader and more flexible approach taken by Ryan J in Meroka was not intended to be so constrained. 102 It is also arguable that the gloss that Sundberg J placed upon reg 1.26, in [12] of Alin , namely that the competent person must indicate that he or she "was aware of the definition of domestic violence in reg 1.23(2)(b)", and refer to "the applicant's state of mind, namely that the violence caused the applicant to fear for or be apprehensive about his personal well-being or safety" is not warranted by the terms of the regulation itself. 103 In any event, it seems to me that these issues are not properly ones for me to determine. They do not arise directly under the notice of appeal. Their only relevance lies in whether relief should be refused on the basis of futility. For the reasons already given, I do not think that remittal would be futile. 104 The question that next arises is, to which body should this proceeding be remitted? As previously indicated, Mr Horan submitted that the matter should be remitted to the MRT. That would have the obvious advantage, for the appellant, of allowing him the opportunity to file further statutory declarations that may meet the formal requirements of reg 1.26. That assumes, of course, that such statutory declarations would be forthcoming. That is an assumption that perhaps should not too readily be made. It may be difficult to persuade a competent person to express the opinions set out in that regulation, at least in circumstances where the declarant has no actual knowledge of the facts said to amount to domestic violence. 105 Of course, once the formal requirements associated with the statutory declarations are met, the Regulations do not require or permit the MRT to come to any decision as to whether domestic violence actually took place. The scheme is one of deeming provisions, and as Wilcox J pithily observed, represents a "triumph of form over substance". 106 Ms Riley submitted that if I were to conclude that the appeal should be allowed because of what the MRT had said regarding the burden of proof, and if I were not persuaded that it would be futile to remit the matter for further consideration, it ought to be remitted to the Federal Magistrates Court, and not to the MRT. That was because the challenge to the validity of the MRT's decision, regarding the statutory declarations and the police records, had not been determined. The application for judicial review before the Federal Magistrates Court, therefore, had still to be completed. 107 I infer that it did not escape Ms Riley's attention that remittal to the Federal Magistrates Court, rather than the MRT, might preclude the appellant from seeking to rectify any defects associated with the statutory declarations by filing new ones. 108 In the end, I think that Ms Riley's submission that this matter should be remitted to the Federal Magistrates Court, rather than the MRT, should be accepted. I say that not because this would be tactically advantageous to either side. Rather, it seems to me that when an appeal from the Federal Magistrates Court is allowed, as this appeal will be, this Court should ordinarily make the orders that the Federal Magistrates Court itself ought to have made. However, where the Federal Magistrates Court has not completed its task of judicial review, as is the position in the present case, then as a general rule, it ought to be required to do so. 109 It follows that the appeal will be allowed. The decision of the Federal Magistrate dismissing the application for review, and his Honour's order that the appellant pay the respondent's costs, will be set aside. In lieu thereof, the matter will be remitted to the Federal Magistrates Court to be dealt with according to law. The costs of the previous proceeding before the Federal Magistrate, together with the future costs of that proceeding, will be reserved. 110 With regard to the costs of this appeal, the respondent should pay those costs. 111 In accordance with the High Court's decision in SAAP v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24 ; (2005) 215 ALR 162, the MRT has been joined as a respondent to this proceeding. I certify that the preceding one-hundred and eleven (111) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Weinberg. | appeal from federal magistrate's decision application for spouse visa and invocation of special provisions relating to domestic violence in migration regulations 1994 (cth) whether migration review tribunal ("mrt") erred by imposing burden of proof upon applicant to establish genuine and continuing spousal relationship whether futile to remit matter to mrt or federal magistrates court by reason of mrt's findings in relation to domestic violence exception contained in div 1.5 of migration regulations 1994 (cth) migration |
Her daughter was born in China on 25 May 1988. On 31 August 2005 she was issued with a passport by the People's Republic of China. On 4 July 2006 she arrived in Australia on a three month visa. 2 On 14 August 2006 the appellant applied for a Protection (Class XA) visa. That application was refused by a Delegate of the Minister on 26 August 2006. On 26 September 2006 the appellant applied to the Refugee Review Tribunal ('the Tribunal') for review of the Minister's Delegate's decision. 3 On 17 October 2006 the appellant was invited to a hearing on 17 November 2006 before the Tribunal to give oral evidence and present arguments in support of her claims. The appellant attended such a hearing which appears to have lasted for approximately two hours. 4 On 22 December 2006 the Tribunal decided to affirm the Minister's Delegate's decision not to grant the appellant a Protection (Class XA) visa. The Tribunal was not satisfied that the appellant was a person to whom Australia had protection obligations under the Convention relating to the Status of Refugees done at Geneva on 28 July 1951, as amended by the Protocol relating to the Status of Refugees done at New York on 31 January 1967 (collectively referred to as 'the Refugees Convention'). The decision of the Tribunal was handed down on 18 January 2007. 5 On 16 February 2007 the appellant applied to the Federal Magistrates Court of Australia for constitutional writ relief in respect of the Tribunal's decision. the RRT breached the Section 424A of the Migration Act by not inviting the applicant to comment on particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review. The Tribunal did not invite the applicant to explain why she was not familiar with the nature of GPPCC. He ordered that the application be dismissed and that the applicant pay the respondent Minister's costs fixed in the sum of $3,500. The applicant, in her application, sets out one ground for relief. She claims that the Refugee Review Tribunal breached s.424A of the Migration Act by not inviting the applicant to comment on particulars of any information that the Tribunal considered would be the reason, or a part of the reason, for affirming the decision that was under review. In particular, the applicant claimed that the Tribunal dismissed her claims because she was unable to explain what the Guangdong People's Political Consultative Conference --- an organisation the applicant claims her mother was former vice-president of --- was or what it did. The applicant says the Tribunal did not invite her to explain why she was not familiar with the nature of the GPPCC. The applicant did not file any amended application or any written submissions. She relies on no other ground of review. At the hearing, I invited the applicant to expand on her application and advise the Court of particulars of that or any other jurisdictional error. The applicant addressed the factual matters, claiming that her mother's work with the GPPCC was confidential and she did not know what her mother's work involved. The applicant said that her mother was opposed to the Chinese Government's suppression of the Falun Gong movement and she spoke out in support of Falun Gong practitioners. She said that her mother suffered persecution from the Chinese authorities because of her opposition to the government's policy, and she also said that her husband became scared that the authorities would persecute the applicant and her family, and, as a result, he divorced her. The applicant said that she then came to Australia with her daughter and expressed a wish that the Australian government could give her political asylum. Unfortunately, the grounds contained in the applicant's oral submission do not reveal any jurisdictional error and are merely challenges to the Tribunal's factual finding. A challenge to the factual findings of the Tribunal is no more than what is referred to as a "merits review", and merits review is not available on judicial review of the finding of the Refugee Review Tribunal. They contained a five page summary of the appellant's evidence before the Tribunal. 8 In the application for a Protection (Class XA) visa the appellant had been asked what she feared may happen to her if she went back to the People's Republic of China. Of course I have never involved in such crime, but the government would produce evidence to convict me. So the government would persecute her and her close family members. She was not a communist and disagreed with the Party's policies in many aspects. She has been questioning the government's persecution on Falun Gong in many occasions since 1999. At first she only expressed her objection inside the Consultative Conference. Later when she found that her opinion had never been considered, she started to express her opinion to medias. Of course Chinese medias would not report her opinion, but some foreign medias would. She was soon targeted by the Government in 2003 after a Taiwan newspaper reported her opinion about the persecution on Falun Gong. In 2004 the Guangdong provincial government alleged my mother had taken bribes during the period she was the vice president of the Consultative Conference and the government started to collect evidence to prosecute her. The government also alleged that some money had been transferred to my hairdressing business for money laundry (sic) . So I was also approached by police. So I planned to escape to foreign countries. She also changed her evidence frequently during the course of the hearing. The Tribunal thus does not accept that the applicant's mother expressed a political opinion. It follows that the Tribunal does not accept that the political opinion was published in a newspaper. The Tribunal does not accept that the Chinese authorities made allegations that either the visa applicant or her mother was corrupt, that they took bribes or that they were involved in money laundering. It follows that it does not accept that the applicant or her mother were interviewed by the Chinese authorities, or that the applicant would be persecuted if she returned to China because of any political opinion, imputed political opinion, on the basis of being a member of the family of a Falun Gong supporter, or for any other Convention reason. Therefore the Tribunal finds that the applicant does not have a well founded fear of persecution for a Convention reason if she returns to China. The Tribunal dismissed the applicant's claims as she was unable to explain what the GPPCC (Guandong People's Political Consultative Conference, an organization the applicant claims that her mother was the former vice-president of), was or what it did. The Tribunal did not invite the applicant to explain why she was not familiar with the nature of GPPCC. The Federal Magistrates Court failed to examine this claims (sic) properly. The truth of the matter is that the Tribunal was not satisfied that the appellant was a person to whom Australia had protection obligations under the Refugee's Convention. 17 The assertion that the Tribunal fell into jurisdictional error by failing to invite the appellant to explain why she was not familiar with the nature of GPPCC is a furphy. 18 It is important to remember that proceedings before the Tribunal are inquisitorial rather than adversarial. 19 The Tribunal Member conducting an enquiry is obliged to be fair. However, the Tribunal is not in the position of a contradictor of what is being advanced by an applicant. In a case such as that brought by the appellant under her application for review to the Tribunal, it was for her to advance whatever evidence or argument she wished to advance and for the Tribunal to decide whether her claim that she was a refugee, within the meaning of the Refugees Convention, had been made out. The Tribunal was not obliged to prompt and stimulate an elaboration which she may have chosen not to embark upon (per Gummow and Heydon JJ in Re RUDDOCK (in his capacity as Minister for Immigration and Multicultural Affairs); Ex parte APPLICANT S154/2002 (2003) 201 ALR 437 at [57] --- [58]). 22 Section 424A does not authorise scrutiny of the inquisitorial process such that an explanation must be provided or apparent for the Tribunal's questions or the manner of their formulation or the Tribunal's omission to ask questions. A failure to enquire as to why a particular answer, which may form part of the reason for the Tribunal's decision, was given to a Tribunal Member's question at a hearing, does not constitute 'information' to which s 424A applies. However broadly "information" be defined, its meaning in this context is related to the existence of evidentiary material or documentation, not the existence of doubts, inconsistencies or the absence of evidence. On the contrary, to adopt such a course would be likely to run a serious risk of conveying an impression of pre-judgment. 27 The appellant failed to provide any written submissions in support of her case. It is a government organisation. Its functions are not open to the public. The appellant's reliance upon s 424A(1)(a) of the Act is quite misconceived, as the recent decision of the High Court handed down on 13 June 2007 in SZBYR makes clear. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Graham. | limited reach of s 424a of the migration act in respect of the tribunal's obligation to give particulars of information that it considers would be the reason or a part of the reason for affirming the decision under review migration |
On or before 23 October 2006, David Robert Siminton produce all his books, bank statements, savings accounts, share certificates and other documents relating to his financial position before the Deputy Registrar of the Federal Court of Australia at 305 William Street Melbourne Vic 3000. 2. On 30 October 2006, at 10.15am David Robert Siminton attend and be orally examined as to whether he has any, and what other property or means of satisfying the judgment of the Full Court of the Federal Court made on 19 July 2006 before a Deputy District Registrar of the Federal Court of Australia at Level 9, 305 William Street Melbourne Vic 3000. 3. That service of this order on the Respondent be effected by sending a copy of the order by pre-paid post to the Solicitors for the Respondent. 4. Costs of the motion dated 3 October 2006 be reserved. After hearing argument I made orders pursuant to O 37 r 7 of the Federal Court Rules which required the respondent to produce financial documents and to appear before a Deputy Registrar of the Court to be examined as to whether he has any property or other means of satisfying the Full Court's order. At the time of making the orders I indicated that I would publish my reasons for doing so at a later date. These are those reasons. 2 It is necessary to commence with a short chronology of the proceeding in which the present application is brought. I need do no more than summarise the background facts which are set out in detail in the Full Court's judgment in Siminton v Australian Prudential Regulation Authority [2006] FCAFC 118 at [2] - [22] . The respondent claimed to be the Governor of the State of Sherwood in HM Government of Camside. He published a website in which he advertised an institution called the Terra Nova Cache which was described as being 'Camside's new bank'. The applicant became aware that the respondent had been soliciting and receiving funds from members of the public. An application for interim relief was heard ex parte by Sundberg J on 15 December 2005. His Honour made orders, inter alia, restraining the respondent from disposing of funds held by himself, the Principality of Camside or the Terra Nova Cache and required him to take certain steps, which included the provision of information and documents. The applicant alleged that, in breach of the orders made by Sundberg J, the respondent had transferred or withdrawn funds from accounts covered by the orders or had attempted to do so. Contempt of court charges were heard by Merkel J. On 30 March 2006 Merkel J found that the respondent had committed contempt by breaching certain of the orders made by Sundberg J: see Australian Prudential Regulation Authority v Siminton [2006] FCA 326. On 10 April 2006 Merkel J ordered, inter alia, that the respondent be imprisoned for a period of 10 weeks for his contempt of court. The respondent appealed and a Full Court set aside the order for imprisonment and substituted a fine of $50,000. Shortly before the 60 day time limit was due to expire the respondent applied to the District Registrar for an extension of time. A two week extension was granted which was due to expire at 5 pm on 2 October 2006. A request for a further extension of one month was refused by the Registrar on the afternoon of 2 October 2006. The fine was not paid before the required time and has not since been paid. 4 In these circumstances the District Registrar, acting in accordance with par 2(c) of the Full Court's Order, sought, by Notice of Motion, a direction concerning the enforcement of the fine of $50,000. Such a procedure was held, by Merkel J, to be appropriate in such circumstances: Australian Industry Group v Automotive, Food, Metal, Engineering, Printing and Kindred Industries Union of Australia (2001) 188 ALR 653 at 658. 5 When the Notice of Motion was called on, counsel for the Respondent submitted that I lacked jurisdiction to entertain the application for directions. He did so upon the basis that the Full Court's order should be construed as meaning that any application under par 2 (c), should be dealt with by one of the Judges who constituted the Full Court. I rejected this submission. The language employed by the Full Court is plain and there is no reason to read in words which do not appear. There was no contention that a single Judge might not entertain such an application. 6 One direction which could have been made was that the District Registrar should institute a further proceeding against the respondent for punishment for contempt pursuant to O 37 r 7 of the Federal Court Rules and r 75.07 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic). This procedure was and remains open given that the respondent has failed to comply with the Full Court's order and that such failure may constitute a further contempt: see Australian Industry Group at 658. I determined not to make such an order immediately given the assertion, by counsel for the respondent, that his client was not in a financial position to make the required payment. Counsel, however, was unable to point to any evidence as to the precise state of the respondent's financial affairs. Faced with a choice between filing an affidavit deposing to his financial position and participation in an examination before a Deputy Registrar of the Court, the respondent, through counsel, expressed a preference for the latter course. The applicant was a resident of Victoria and present in the State. The bank accounts which were the subject of the Court's orders were held in Victoria. At various stages during the proceeding the respondent had asserted that at least some of the funds held in these accounts belonged to him. In my view, these considerations supported the submission that the Full Court's order would be enforceable in Victoria. Plainly, the making of an order for examination and production, under the Rule, is discretionary in nature. In my view, in the circumstances of this case, it was appropriate to make orders of the kind contemplated by r 67.02 before considering what, if any, other directions should be made. The Court presently knows very little about the respondent's financial affairs. The vague generalities and assertions made by counsel appearing for the respondent suggest that the respondent himself may have but a limited appreciation of his financial position. His capacity to pay (or lack of it) may be a relevant consideration in the determination of any charge that the respondent had committed a contempt of Court. The respondent has, over a long period, chosen not to avail himself of opportunities to ascertain and disclose his financial position. It may be that this unwillingness has operated to his disadvantage. It may be, for example, that the District Registrar, had she known of his financial position, might have been persuaded to permit him to make payments by instalments in accordance with the Full Court's orders. Questions of fairness to the respondent thus arise. There is also an imperative that the orders of the Court should be obeyed and the Court, on an application such as the present, should be prepared to give directions that will serve to see its orders obeyed: c.f. Guthrie v Robertson (1987) 13 FCR 336 at 337-8. The orders made were conducive to this end. On or before 23 October 2006, David Robert Siminton produce all his books, bank statements, savings accounts, share certificates and other documents relating to his financial position before the Deputy Registrar of the Federal Court of Australia at 305 William Street Melbourne Vic 3000. 2. On 30 October 2006, at 10.15am David Robert Siminton attend and be orally examined as to whether he has any, and what other property or means of satisfying the judgment of the Full Court of the Federal Court made on 19 July 2006 before a Deputy District Registrar of the Federal Court of Australia at Level 9, 305 William Street Melbourne Vic 3000. 3. That service of this order on the Respondent be effected by sending a copy of the order by pre-paid post to the Solicitors for the Respondent. 4. Costs of the motion dated 3 October 2006 be reserved. In these circumstances I dispensed with the requirement for personal service and allowed for service of the orders I made to be effected by sending a copy of them to the respondent's solicitor. | contempt enforcement of an order to pay a fine interpretation of full court order whether application for contempt to be heard before a single judge or full court whether full court order enforceable in victoria effect of impecunious respondent whether capacity to pay order is a relevant consideration evidentiary burden on respondent to reveal financial situation practice and procedure |
Section 412 makes provision for applications for review of RRT-reviewable decisions. Under s 415(1) of the Act, the Refugee Review Tribunal ('the Tribunal') may, for the purposes of the review of an RRT-reviewable decision, exercise all the powers and discretions that are conferred by the Act on the person who made the decision. The purpose of a provision such as s 420(2) is to free bodies such as the tribunal from certain constraints otherwise applicable in courts of law which the legislature regards as inappropriate. Further, ... administrative decision-making is of a different nature from decisions to be made on civil litigation conducted under common law procedures. There, the court has to decide where, on the balance of probabilities, the truth lies as between the evidence the parties to the litigation have considered it in their respective interests to adduce at trial. Hereafter I will refer to the Refugees Convention as amended by the Refugees Protocol as 'the Convention. Whilst cases such as Minister for Immigration and Multicultural Affairs v Rajalingam [1999] FCA 719 ; (1999) 93 FCR 220 ('Rajalingam') refer to the 'civil standard of proof' being not irrelevant to the process of fact-finding by the Tribunal and cases such as Kalala v Minister for Immigration and Multicultural Affairs [2001] FCA 1594 ; (2001) 114 FCR 212 ('Kalala') refer to the Tribunal being obliged to consider matters on 'a standard less than the balance of probabilities' (see at [25]). I doubt the utility of addressing matters on which the Tribunal has to be 'satisfied' by a standard which is related to the standard of proof required in adversarial civil litigation. As has been said many times, proceedings in the Tribunal are not adversarial, but, rather, inquisitorial. The Tribunal is not in the position of a contradictor of the case being advanced by an applicant. The Tribunal member conducting the relevant inquiry is not an adversarial cross-examiner, but an inquisitor obliged to be fair (see per Gummow and Heydon JJ in Applicant S154/2002 at [57]; see also Minister for Immigration and Multicultural and Indigenous Affairs v QAAH of 2004 [2006] HCA 53 ; (2006) 231 CLR 1 at [40] ). The Tribunal conducting an inquisitorial hearing is not obliged to prompt and stimulate an elaboration which an applicant chooses not to embark on. It is for an applicant to advance whatever evidence or argument he or she may wish to advance before the Tribunal, and for the Tribunal to decide whether the relevant claim has been made out (see per Gummow and Heydon JJ in Applicant S154/2002 at [57] --- [58]). Procedural fairness does not require the Tribunal to give an applicant a running commentary upon what it thinks about the evidence that is given. On the contrary, to adopt such a course would be likely to run a serious risk of conveying an impression of pre-judgment (per Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 ; (2006) 228 CLR 152 at [48] ). In NAGV and NAGW of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs and Another [2005] HCA 6 ; (2005) 222 CLR 161 ('NAGV'), the High Court considered s 36(2) of the Act in the form in which it existed prior to the passage of the Border Protection Legislation Amendment Act 1999 (Cth). Free access to courts of law (Art 16(1)), temporary admission to refugee seamen (Art 11), and the measure of religious freedom provided by Art 4 are examples. Section 36(2) does not use the term "refugee". But the "protection obligations under [the Convention]" of which it does speak are best understood as a general expression of the precept to which the Convention gives effect. The Convention provides for Contracting States to offer "surrogate protection" in the place of that of the country of nationality of which, in terms of Art 1A(2), the applicant is unwilling to avail himself. That directs attention to Art 1 and to the definition of the term "refugee". This indicates that the terms in which s 36 is expressed were adopted to do no more than present a criterion that the applicant for the protection visa had the status of a refugee because that person answered the definition of "refugee" spelled out in Art 1 of the Convention. No Contracting State shall expel or return ("refouler") a refugee in any manner whatsoever to the frontiers of territories where his life or freedom would be threatened on account of his race, religion, nationality, membership of a particular social group or political opinion. The Convention is framed to ensure that persons will not be exposed to persecution, as defined by Australian law, if they were to return to the country which they have left. If any threat or relevant risk is not current or prospective, then there can be no well-founded fear of persecution (per Callinan and Heydon JJ in VBAO v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 60 ; (2006) 233 CLR 1 ('VBAO') at [49]-[50]). The word 'threat' as used in s 91R(2)(a) of the Act connotes 'risk' in the sense of danger or hazard (per Gummow J in VBAO at [18]). It is indicative of a likelihood of harm (per Gleeson CJ and Kirby J in VBAO at [1] and [3]). The definition of 'refugee' in the Convention is couched in the present tense, and the text indicates that the position of the putative refugee is to be considered on the footing that that person is outside the country of nationality. The reference then made in the text to 'protection' is to 'external protection' by the country of nationality, for example, by the provision of diplomatic or consular protection, and not to the provision of 'internal protection' provided inside the country of nationality from which the refugee has departed (per McHugh and Gummow JJ in Minister for Immigration and Multicultural Affairs v Khawar [2002] HCA 14 ; (2002) 210 CLR 1 ('Khawar') at [62], cited with approval by Gummow, Hayne and Crennan JJ in SZATV v Minister for Immigration and Citizenship [2007] HCA 40 ; [2007] 233 CLR 18 ('SZATV') at [16]). The definition of 'refugee' presents two cumulative conditions, the satisfaction of both of which is necessary for classification as a refugee. The first condition is that a person be outside the country of nationality 'owing to' fear of persecution for a relevant Convention reason, which is well-founded both in an objective and a subjective sense. The second condition is met if the person who satisfies the first condition is unable to avail himself or herself 'of the protection of' the country of nationality. This includes persons who find themselves outside the country of their nationality and in a country where the country of nationality has no representation to which the refugee may have recourse to obtain protection. The second condition also is satisfied by a person who meets the requirements of the first condition and who, for a particular reason, is unwilling to avail himself or herself of the protection of the country of nationality; that particular reason is that well-founded fear of persecution in the country of nationality which is identified in the first condition (per McHugh and Gummow JJ in Khawar at [61], cited with approval by Gummow, Hayne and Crennan JJ in SZATV at [16]; see also Chan v The Minister for Immigration and Ethnic Affairs [1989] HCA 62 ; (1989) 169 CLR 379 ('Chan'), Applicant A v Minister for Immigration and Ethnic Affairs [1997] HCA 4 ; (1997) 190 CLR 225 ('Applicant A') at 283 and Minister for Immigration and Multicultural Affairs v Respondents S152/2003 [2004] HCA 18 ; (2004) 222 CLR 1 ('S152') at [19]). It is well settled since Chan and Minister for Immigration and Ethnic Affairs v Guo [1997] HCA 22 ; (1997) 191 CLR 559 ('Guo') at 571-572 and 596 that the requirement that the 'fear' be 'well-founded' adds an objective requirement to the examination of the facts and that this examination is not confined to those facts which form the basis of the fear experienced by the particular applicant (per Gummow, Hayne and Crennan JJ in SZATV at [18]). A fear is 'well-founded' where there is a real substantial basis for it (see Guo at 572). The so-called 'relocation principle' was considered by Gummow, Hayne and Crennan JJ in SZATV at [9] - [22]. At [11] their Honours observed that any notion of 'relocation' and of the 'reasonableness' thereof is to be derived, if at all, as a matter of inference from the more generally stated provisions of the definition of 'refugee' contained in the Convention. The effect of the Tribunal's stance was that the appellant in that case was expected to move elsewhere in Ukraine and live 'discreetly' so as not to attract the adverse interest of the authorities in his new location lest he be further persecuted by reason of his political opinion. The High Court ordered that the decision of the Tribunal be quashed and that the appeal from the decision of the Federal Court on an appeal from the Federal Magistrates Court of Australia be allowed. The second appellant is a non-citizen in Australia who is the spouse of the first appellant. She does not contend that she is a person to whom Australia has protection obligations under the Convention. The appellants arrived in Australia on 4 March 2008 having left India on the previous day. They each travelled on passports issued by the Indian government and entered Australia relying upon three month visitor visas. On 17 April 2008 the appellants applied for Protection (Class XA) visas. On 3 July 2008 a delegate of the Minister decided that the application of the appellants for protection visas should be refused as their claims did not meet the requisite criterion for a protection visa set out in s 36(2) of the Act. On 30 July 2008 the appellants applied for review of the Minister's delegate's decision to the Tribunal. On 18 August 2008 the Tribunal wrote to the appellants' representative advising that it had considered the material before it but it was unable to make a favourable decision on that information alone. In the circumstances, the appellants were invited to appear before the Tribunal to give oral evidence and present arguments on 17 September 2008. That hearing was rescheduled for 3 October 2008 and on that day the first appellant alone appeared. The first appellant is fluent in English and can read and write English. He has been accompanied to Court today by an interpreter who is able to interpret from the English language into Malayalam and from Malayalam into English but it has been unnecessary for the interpreter to become involved in assisting the first appellant except in a minor respect. The hearing before the Tribunal occupied a little over one hour. No record of what transpired in the Tribunal hearing was placed before the Federal Magistrates Court of Australia, to which further reference will be made shortly. The Tribunal's decision of 15 October 2008, affirming the decisions of the Minister's delegate not to grant the appellants Protection (Class XA) visas, was handed down on 4 November 2008. On 28 November 2008 the appellants filed an application in the Federal Magistrates Court of Australia seeking constitutional writ relief in respect of the decision of the Tribunal. 58 the Tribunal correctly determined the basis of the application before it as fear of persecution on the basis of religion, political opinion and membership of a particular social group. 60 the Tribunal purported to determine the issue of political belief. It would appear that thereafter Additional Grounds of Application to which reference has been made were drawn by one of the panel advisers, Mr John Atkin of counsel. The application for constitutional writ relief came before a Federal Magistrate on 3 April 2009, the relevant decision thereon being delivered on 29 April 2009. The proceeding before the Court, commenced by way of application filed 28 November 2008, is dismissed. The RRT did not consider all the practicalities for my wife and me in relocating in India. I will file and serve an amended notice of appeal and written submissions when required by this Court. Those submissions were signed by both the first appellant and the second appellant, although the first appellant alone has appeared on the hearing of the appeal. It would appear that the Appellants' Written Submission was not served upon the legal representatives for the first respondent, although a copy of it was made available during the course of the present hearing. The appellants' application for Protection (Class XA) visas revealed that they were members of an ethnic group described as 'Other Backward Community' and that their religion was 'Latin Catholic. ' Each of the appellants comes from the State of Kerala, although it would appear that the home town of the appellants was at Kazhakoottam, which may not be typical of the whole of the State of Kerala. The first appellant's claim to having a well-founded fear of persecution for a Convention reason referred to his membership of the Kerala Student Union, being a student wing of the Indian National Congress. He referred to the opposition to the student wing to which he belonged, being the Student Federation of India, which was a wing of the Communist Party of India (CPI(M)). The first appellant referred to his student political activity in the period 1985 --- 1987. He asserted that he had been assaulted by members of the Student Federation of India in his student days. The first appellant also referred to the fact that he had spent a considerable period of time working in Abu Dhabi. It would appear that he worked there for some eight years, from 1997 to 2005, with irregular contact with his family back in India. He apparently married the second appellant in 2000 and they appear to have two children, born in 2003 and 2005. When the first appellant returned from the Gulf area in 2005, he established, so he says, a small bakery business in the names of himself and his wife, although he said that his father was the legal owner of the business even though it had been financed and managed by him. At this stage, the CPI(M) was in power in Kerala. It would appear that union workers who were members of CPI(M) made claims upon the first appellant for preferential employment for union members who were members of the CPI(M). The first appellant claimed that he ran into difficulties with the CPI(M) and that 'thugs demanded my workers to stop working for me and I was badly beaten by them. ' The first appellant asserts that he was warned that he should not report the matter to the police. The first appellant also referred to a public well located in front of a church at which he worshipped in Kazhakoottam. It would appear that Hindus were engaged in constructing a memorial in that location and according to the first appellant were filling the well with concrete or mud, however one describes the relevant material. As a backward Christian community I faced lose (sic) of income, inability to run the business and threats from CPI (M) union ...". ' He further said, 'My opportunity to run a business and to survive was denied due to my political profile. He said that he was vulnerable to persecution in the state of Kerala as long as CPI(M) was in power. The ' CLAIMS AND EVIDENCE ' section of the Tribunal member's Statement of Decision and Reasons recorded demands made upon the first appellant by the CPI(M) and local council members in about March 2007 who demanded that he provide them with funding for their party, which he refused. He claimed before the Tribunal member that the CPI(M) members and a local council member, Rajan, threatened his workers, and he was 'badly beaten'. He says that he was warned not to go to the police (see [34] above). The Tribunal also recorded the first appellant's claim 'that there were clashes between Christian and Hindu extremists along with the SNDP members and supporters and he was severely assaulted by the Hindu supporters in this conflict' (see [35] above). He asserted that as long as the CPI(M) was in power in the state of Kerala, he was vulnerable to persecution. The 'Country Information' to which the Tribunal member referred included a note that India was a secular state with no official religion. It also referred to the fact that Kerala was the State which had the highest concentration of Christians in all of India. It was said that, according to government figures, Christians comprised 19 per cent of the population of Kerala whilst the national average was 2.3 per cent. Recent reports of attacks on Christians in Kerala include the murder of a Christian man by suspected extremists, and the vandalising of a new Gospel Centre. Generally, citizens are free to relocate from one state of India to another. The available information suggests that, although Christians are generally able to live a normal life in India, this has been affected by an increase in Hindu fundamentalism in recent years. ... the available information suggests that religious minority groups, (including Christians) are being increasingly targeted by Hindu extremist groups and that the central government sometimes does not act effectively to counter such attacks, thereby contributing to the view that these violent acts may be committed with impunity. The applicant's claims, as they emerged from the hearing, are that he fears persecution on the basis of his religion, political opinion and membership of a particular social group. He claims he has been subject to persecution in the past because of this and fears persecution should he return to India in the future. He also did not detail the fact that his wife was said to have been a candidate for political office. The Tribunal found the First Applicant was not a witness of truth. There may have been aspects of the Statement of Decision and Reasons which were consistent with an embellishment by the first appellant of his case, but there were many aspects of the claims made by the first appellant which were plainly accepted by the Tribunal. Another seemingly unusual feature of her Honour's Reasons for Judgment in this case was her extensive use of expressions such as 'A fair reading of the Tribunal's decision record suggests...'. Her Honour used this expression, or a similar one at [32], [33], [36], [53] (twice), [64] (twice), [67] and [72] (twice). I am conscious of the fact that a Court should not view the reasons of a Tribunal member with an eye for detail which is alert to minute error. However, I am concerned that, having identified the claims made by the first appellant and recorded by the Tribunal member at [58] of her Statement of Decision and Reasons (see [41] above), the Tribunal member appears to have addressed only one of those claims in any detail. As the Tribunal member said, the first appellant feared persecution firstly on the basis of his religion, secondly on the basis of his political opinion, and thirdly on the basis of his membership of a particular social group. The headings which follow in the Tribunal member's Statement of Decision and Reasons under the heading FINDINGS AND REASONS were: ' Political opinion ', ' Harm ', ' State Protection ', and ' Relocation '. Somewhat curiously, there were no headings ' Religion ' and ' Membership of a Particular Social Group ' after ' Political opinion '. The Tribunal accepted that the First Applicant may have suffered some discrimination because of his wealth and the fact that he owned a business, however, was not satisfied that the First Applicant was targeted by reason of his political opinion. Neither did the Tribunal accept that the First Applicant was beaten because of his political opinion. A fair reading of the Tribunal's decision record suggests that this finding is a rejection of any Convention based persecution of the First Applicant by reason of his membership of a particular social group of wealthy business owners who are also members of the Indian National Congress Party. Having considered all the issues and the claims made by the applicant individually and cumulatively, and based on the evidence currently before it, the Tribunal is not satisfied that the applicant suffered past persecution or that he faces a real chance of being persecuted now or in the reasonably foreseeable future if he returns to India in relation to his race, his religion, his nationality, political opinion or membership of a particular social group, actual or imputed. The Tribunal is not satisfied, on the evidence before it, that the applicant has a well-founded fear of persecution. ... the Tribunal does not accept that the applicant was targeted for his political opinion. The Tribunal does not accept that the applicant was beaten because of his political opinion. ... The Tribunal finds that the applicant has embellished his claims for the purposes of supporting a protection application and does not accept that he suffered harm amounting to persecution. The Tribunal accepts that whilst Christians form a significant religious minority in Kerala, sectarian and inter-religious violence nevertheless occurs and it is not implausible that the applicant may become a victim or (sic) random acts of violence in such circumstances. However this would make him a victim of civil disorder or generalised sectarian violence and not necessarily a refugee from persecution. He is also a returnee from the Gulf and also imputed as a wealthy man as a result. The Tribunal accepts that the applicant may have experienced bullying, threats, and extortion in trying to run his business. It accepts that there have been clashes between Hindus and Christians and the applicant may have at some stage witnessed such clashes or been a victim of such clashes. She also accepted that it was 'not implausible' that the first appellant may become a victim of random acts of violence in such circumstances. She further was of the opinion that his victimisation may be as a 'refugee from persecution' which was recognised by her use of the words 'not necessarily' at [65] of her Statement of Decision and Reasons. It is also apparent that the Tribunal member acknowledged that the first appellant was a member of a particular social group, being returnees from the Gulf who were imputed to be wealthy as a result. The Tribunal member accepted that the first appellant may have experienced bullying, threats and extortion in trying to run his business, apparently in the context of him being a member of a particular social group. Unfortunately, the Tribunal member did not record her finding as one of satisfaction or dissatisfaction in relation to the fear of persecution which the first appellant claimed to have experienced by reason of his membership of the particular social group. The Tribunal member then proceeded to find that the first appellant 'may have ... been a victim of ... clashes [between Hindus and Christians]. ' Unfortunately, the Tribunal member failed to specifically address the question of whether or not, owing to a well-founded fear of being persecuted for reasons of religion and/or membership of a particular social group, the first appellant was outside the country of his nationality and unable or, owing to such fear, unwilling to avail himself of the protection of India. I am not satisfied that the words of paragraph [75] of the Tribunal member's reasons deal with these issues, given that the words of paragraph [75] are inconsistent, at least in part, with the words of paragraphs [65] and [66]. It is hard to understand how the Tribunal could on the one hand accept that there had been clashes between Hindus and Christians and that the first appellant may have been a victim of such clashes, and, at the same time, not be satisfied that the applicant 'suffered past persecution. ' In relation to State protection, the Tribunal member seems to have focused mainly upon the fact that the first appellant did not seek State protection. The answer proffered by the first appellant was that the police would not help him because they were close allies with the CPI(M) and that the police consorted with that political party. It must be recalled that in his original application for a protection visa, the first appellant asserted, as I understood it, that whilst the CPI(M) was in power, the Kerala police were slow to protect persons who experienced the problems and the escalating violence which he asserted. The Tribunal member proceeded to deal with relocation at [73] --- [74] of her Statement of Decision and Reasons. She concluded, effectively, that it was reasonable for the first appellant to relocate within India. As previously indicated, what is 'reasonable' in the sense of 'practicable' must depend upon the particular circumstances of the applicant for refugee status and the impact upon that person of relocation of the place of residence within the country of nationality. If the Tribunal member focused her attention primarily upon the first appellant's claim to refugee status by virtue of his claimed political opinion and failed to address satisfactorily the claims to refugee status based upon his religion and upon his membership of a particular social group, being wealthy returnees from the Gulf (in his case, after spending eight years working in the Gulf) undermines, in my view, the finding made by the Tribunal member on the reasonableness of relocation within India. It may well be that for the reasons proffered by the first appellant, relocation within India was not as simple a matter as it may otherwise have been thought to be. One would have thought that it would be necessary, at the least, to consider the reasonableness of relocating to another state within India where there may also have been claims made on Gulf returnees which might constitute serious harm, in the form of significant economic hardship or physical threats if demands for the payment of money were not met. If extortionate demands were placed upon the first appellant, wherever he lived, because he belonged to the particular social group mentioned, it may be that relocation within India was not a reasonable alternative. In my opinion, the appeal should be allowed, the orders of the Tribunal quashed and a writ of mandamus issued requiring the second respondent to determine the application made on 17 April 2008, according to law. I certify that the preceding sixty-two (62) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Graham. The Second Appellant did not appear. | jurisdictional error failure to sufficiently address two out of three reasons for a claimed well-founded fear of persecution impact of failure on consideration of reasonableness of relocation within country of nationality migration |
On 10 July 2008, the Deputy Commissioner of Taxation issued an application in the Federal Magistrates Court for a declaration that none of the documents and other materials seized at the premises of Arthur Christopher Nicholls, at 18 Silvermere Avenue, Paradise, South Australia 5075, by officers of the Australian Federal Police and officers of the Australian Taxation Office, pursuant to the search warrant executed on 6 May 2008, are covered by legal professional privilege. The application was confined in its terms to the documents identified in the application, being those seized on that date, pursuant to that search warrant. This proceeding therefore, concerns the same documents which were obtained upon the execution of the search warrant issued by a Magistrate in this State on 5 May 2008, and which is the subject matter of the proceeding in SAD 138 of 2008. On 9 September 2008, the proceeding was transferred from the Federal Magistrates Court to this Court. It is unnecessary, at this stage, to recite the procedural history, both in the Federal Magistrates Court and in this Court, up until the time of the orders made by Mansfield J on 23 July 2009. I will refer to some of his Honour's remarks in relation to that issue in due course. On 23 July 2009, Mansfield J ordered that all material seized by the Australian Federal Police and the Australian Tax Office, pursuant to the search warrant executed on 6 May 2008, other than specified documents, which are irrelevant for the purpose of this application, being the documents over which privilege was claimed by Mr Nicholls, be released to the Deputy Commissioner of Taxation for inspection. His Honour also made an order staying paragraph one of his orders, until an appeal which had been lodged by Mr Nicholls in relation to a previous decision of his Honour on 15 January 2009 was determined by the Full Court of this Court. I should mention that that appeal was determined and dismissed on 11 August 2009. Mr Nicholls did not appeal from the orders made by Mansfield J on 23 July 2009 within the twenty-one (21) days being the time prescribed for the filing of a notice of appeal by O 52 r 15(1) of the Federal Court Rules . The party must establish special reasons and persuade the court that it ought to exercise its discretion to allow the filing and serving of the notice of appeal. The applicant's application states that the grounds for the application appear in an attached affidavit. On the same day as the application was filed, the applicant filed an affidavit in which he deposed that he was presently unrepresented and indigent, and had to prepare the appeal documents and information necessary for the appeal himself. He claims that during the period between the delivery of Justice Mansfield's reasons on 23 July 2009 and 13 August 2009, which would have been the last day for the filing of a notice of appeal in compliance with O 52 r 15(1), he had to spend all of his time in preparation for an appeal to the Full Court. As a result, he said, he was unable to complete the necessary lodgement of the notice of appeal in this proceeding. The reference in the applicant's affidavit to the appeal is the appeal from the orders made by Mansfield J on 15 January 2009 which was heard and determined by the Full Court of this Court on 11 August 2009. It is that there be shown a special reason why the appeal should be permitted to proceed, though failed after the expiry of twenty-one days. In that context, the expression "special reasons" is intended to distinguish the case from the usual course according to which the time is twenty-one days. But it may be so distinguished (not necessarily will, for the rule gives discretion) wherever the Court sees a ground which does justify departure from the general rule in the particular case. He does not suggest in his affidavit that he did not know that he had to file the notice of appeal within the time prescribed by O 52 r 15(1). He chose not to file it because he chose, as he was entitled, to use that time in preparation for his appeal. He says he was occupied on that appeal to 13 August 2009, but that cannot be right because as I pointed out to him during his argument, the appeal to which he refers was in fact dismissed on 11 August 2009. The first question to be determined is whether the reason Mr Nicholls has given is a special reason to take the matter out of the ordinary. For the reasons which follow, I do not think, in the context of this proceeding and having regard to the history of this proceeding, it is a special reason. Prescribed legislative entitlements are not to be ignored. (b) There must be some acceptable explanation for the delay. (c) Any prejudice to the respondent in defending the proceedings caused by the delay is a material factor militating against the grant of extension. (d) The mere absence of prejudice to the respondent is not enough to justify the grant for an extension. (e) The merits of the substantial application are properly to be taken into account in considering whether an extension of time should be granted. The explanation for the delay is hardly satisfactory. Mr Nicholls was aware that the notice of appeal needed to be lodged by 13 August 2009. Although he may have had obligations in respect to the appeal pending before the Full Court, that did not relieve him of his obligation to comply with the rules. The Deputy Commissioner of Taxation has not contended, in relation to the application for an extension of time, that the Deputy Commissioner would be prejudiced by the granting of an extension of time, which was sought some eight days after the time for filing the notice of appeal had passed. However the absence of prejudice is not a ground for granting an indulgence to the party seeking the indulgence; it merely means that it is not a reason not to grant the indulgence: Hunter Valley Developments v Cohen . It is clear on the authorities, the merits of the appeal must be addressed. The draft notice of appeal identifies 76 grounds of appeal, but when the draft notice of appeal is understood, it could be seen that most of those grounds are no more than what might amount to Mr Nicholls' argument on appeal. The draft notice fails to identify with any particularity the true grounds of the appeal from his Honour's orders. The notice of appeal seems to address three matters of general complaint. The first is in relation to the non-provision by the Deputy Commissioner of an email server to Mr Nicholls during the trial. I am not satisfied that that was ever an issue at the trial or that the non-provision of that email server could have been relevant to the matter with which his Honour was concerned. The second complaint is the failure by the primary judge to grant Mr Nicholls an adjournment. The primary judge dealt with the question of an adjournment at some length in his reasons. There is nothing in the draft notice of appeal which would suggest that his Honour in any way erred in the exercise of his discretion in relation to his refusal to grant Mr Nicholls an adjournment. I shall refer to some of the reasons a little later. The third complaint relates apparently to the cross-examination of Mr Nicholls during the application for the adjournment. There can be no suggestion, in my opinion, that his Honour was wrong to allow the Deputy Commissioner's counsel to cross-examine Mr Nicholls in relation to matters which Mr Nicholls said were relevant to the application for adjournment. Indeed, in my respectful opinion, his Honour would have been wrong to refuse to allow cross-examination on that issue. They appear to be the three main issues which arise out of the notice of appeal. The notice of appeal, however, makes a number of complaints in relation to specific aspects of his Honour's reasons. The form adopted in the notice of appeal is to outline the reasons and then to follow in the next paragraph with the complaint. Regrettably, the complaints do not usually bear upon the findings of which the complaint is made. During this application I pointed out to Mr Nicholls on a number of occasions (by way of example) that the draft notice of appeal identified a particular statement made by his Honour in his reasons and then went on to, apparently, complain about that finding or that statement. However, invariably within the notice of appeal, the complaint which follows the reference to his Honour's reasons does not bear out any error in the reasons themselves. After I had pointed that out to Mr Nicholls during the hearing of this application and, after addressing a number of those issues, Mr Nicholls sought an adjournment of this application in order for him to obtain legal advice so that a more appropriate document could be proffered. The application was opposed by Ms Chapman, counsel for the Deputy Commissioner of Taxation. Mr Nicholls made a number of statements from the bar table in relation to solicitors' involvement in the matter, and the documents that the solicitors had and when he would be able to proffer a further document. Accepting those statements for the purpose of the argument, his ground for the adjournment was that he had provided the reasons for judgment to solicitors who had considered the reasons. He had not provided them with the evidence which was adduced at trial. He would, he thought, be able to provide a notice of appeal which particularised the grounds within a week. Ms Chapman opposed the application on the ground that this was a further instance of delay by Mr Nicholls in this proceeding and other proceedings in this Court, in relation to the issue of the search warrant of 5 May 2008 and the execution of that warrant on 6 May 2008. I refused the application for the adjournment because I was satisfied, on the history given by his Honour in the reasons which are impugned by Mr Nicholls, that Mr Nicholls has failed on a number of occasions to prosecute or defend proceedings in this Court in a timely fashion. I will refer to some of his Honour's comments in relation to that in these reasons. The issue which was before the primary judge arose out of Mr Nicholls making a blanket claim for legal professional privilege on 8 May 2008, over the whole of the material which had been seized during the execution of the search warrant on 6 May 2008. His Honour's reasons demonstrate that the Court has had considerable difficulty in having Mr Nicholls identify the documents over which, in fact, he claimed privilege. The learned judge refers in his reasons to processes which were put in place by the Court, which he said were prolonged and not even completed at the time of hearing. His Honour noted that, during the continuation of this proceeding, the Deputy Commissioner of Taxation had lost patience and had brought this application seeking an order that he be entitled to inspect the seized material. In his reasons, the learned judge has described in detail the attempts which had been made by both the Deputy Commissioner of Taxation and by the Court, to have Mr Nicholls identify precisely the documents over which Mr Nicholls claims legal professional privilege. It would appear, from his Honour's reasons, that Mr Nicholls has not cooperated in any way in attempting to identify those documents. Indeed, as I have already noted, at trial Mr Nicholls sought an adjournment of the application, which it may be inferred his Honour thought was a further delay on Mr Nicholls' part. His Honour's reasons disclose a history of non-cooperation and delay by Mr Nicholls in the process, which the Deputy Commissioner of Taxation and the Court instigated in an attempt to identify precisely the documents over which the claim for legal professional privilege was made. In the end result at trial, Mr Nicholls continued to claim privilege over every document which had been the subject of seizure under the search warrant. There is no satisfactory evidence why he could not, within the time allowed as extended up to 7 May 2009, have completed his inspection of that material so as to list the documents in it over which legal professional privilege is claimed, and to provide evidence in support of those claims where they have been disputed. He has simply not done so, over a period of nearly six months. In fact, in my view, he has deliberately prolonged the process to frustrate the resolution of that issue. The applicant's draft notice of appeal, and indeed the applicant, during argument, continues to make the claim that he is entitled to claim legal professional privilege in respect of all of the documents seized under the search warrant. He has continued therefore, notwithstanding the criticism by the primary judge over his inability to particularise the documents which he said are the subject of legal professional privilege, to claim that every document which is presently in the custody of the Court is subject to that privilege. The draft notice of appeal, in my opinion adopts if I might say, the same approach which was apparently adopted before his Honour, which is to refuse to descend into any particularity about the complaints. The draft notice of appeal does not identify any real ground of appeal, but is merely a statement of complaint of his Honour's reasons generally. In the hearing before his Honour, Mr Nicholls' claim for legal professional privilege failed because he adduced no evidence in support of the claim that any of the documents were communications which were protected by legal professional privilege. Insofar as some of his evidence, and in particular his evidence about his inability to open some of the electronic documents, not only was that evidence rejected but his Honour found that the evidence was untruthful. There is, in my opinion, nothing in the draft notice of appeal which would indicate that the applicant has any real prospects of success in relation to an appeal from his Honour's orders. The draft notice is, as I have said, merely an argument which takes issue with the whole of his Honour's reasons. For those reasons I am not satisfied that there are any real prospects of success. In the circumstances where no special reason has been advanced and where there are little or no prospects of success on appeal, it would be inappropriate to grant the order sought. I therefore refuse the application for an extension of time within which to appeal. I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lander. | application for extension of time to file notice of appeal federal court rules o 52 r 15(2) extension may be granted "for special reasons" depends on the merits of the substantial application practice and procedure |
2 On 27 February 2006 the appellant filed a notice of appeal from a decision of Jarrett FM of 6 February 2006, wherein the learned Federal Magistrate had dismissed the appellant's application and ordered the appellant to pay the costs of and incidental to that application. The application was for a review of a decision made by the Migration Review Tribunal affirming a decision not to grant the appellant a student (temporary) (class TU) higher education sector visa. 3 Subsequently, on 14 June 2006 the appellant filed an application seeking an order that the orders of Jarrett FM be set aside. On 28 August 2006, Jarrett FM made orders setting aside his orders of 6 February 2006, that the applicant pay the respondent's costs of and incidental to its application filed 14 June 2006, and that the Migration Review Tribunal be joined as a second respondent to those proceedings. His Honour also made directions including that the appellant's further application be listed for hearing on 23 October 2006 ( Han v Minister for Immigration (No 2) [2006] FMCA 1251). 4 I understand that the further application was heard by Jarrett FM on 23 October 2006, and his Honour has reserved judgment. 5 As a result of this sequence of events, it follows that there is no reason for the appellant to maintain its appeal from the judgment of Jarrett FM of 6 February 2006. Indeed, the appellant before me this morning submitted draft orders including that the appeal be dismissed. 6 The issue upon which the parties do not agree however is the issue of costs in this appeal. The appeal be dismissed. 2. Costs of and incidental to the appeal follow the decision of Jarrett FM currently reserved (Federal Magistrates Court proceedings File No BRG772/2005), with the result that if the appellant is successful before Jarrett FM, the respondent should pay the costs of the appeal, and vice versa if the respondents are successful before Jarrett FM. • There is every prospect that the application for judicial review will be successful. • The basis of the success of the appellant will be an affidavit of Ms Samantha Baldey, the delegate of the respondent who made the original decision not to grant the visa, who deposes to the fact that she placed the notice of decision in an unspecified out-tray and stamped it 'registered mail'. In fact, the appellant submits, no registered mail was ever produced, and a credible reason why the appellant never received the notice of decision was that it had never been posted. • It would be unjust if the appellant was successful in the judicial review application but had to pay the costs of the appeal caused by the original application for summary judgment. The respondent ought to have ascertained if the decision was actually posted or not before bringing an application for summary judgment before Jarrett FM. Mr Boccabella for the appellant directed my attention this morning to an affidavit of a solicitor with Clayton Utz, who deposed that she was instructed 'on the basis of the information currently in the position of the respondent, to file and serve a response because the respondent contends that no reasonable cause of action is shown and that pursuant to r 44.12 of the Federal Magistrates Court Rules 2001 this matter should be dismissed without proceeding to a final hearing'. • The just course would be to make the costs of the appeal costs in the cause of the application before Jarrett FM. • Alternatively, Mr Boccabella submitted in Court this morning that an alternative approach could be for the Court to adjourn hearing this matter in relation to the costs of the appeal until after the decision of Jarrett FM in the substantive matter is delivered. • Leave is not required from the Federal Court to bring an appeal from a summary judgment under r 13.10 Federal Magistrates Court Rules . • The appropriate way to proceed in relation to decisions in the Federal Magistrates Court under r 13.10 is to make an application to set aside the decision under r 16.05. The appellant eventually did this and was successful in having the decision set aside. This approach has been endorsed in a number of cases including MZWXC v MIMIA [2006] FCA 172 and MLGXAL v MIMIA [2006] FCA 966. • The appeal in this matter was always misconceived as to the proper course to proceed, and incompetent as no application for leave to appeal was filed. • The decision of Jarrett FM on the substantive hearing has no relevance to this appeal. Further, Ms Wheatley for the respondent submitted in Court this morning that costs in this appeal bear no relevance to the new matter before Jarrett FM. 10 In my view, a decision of a Federal Magistrate dismissing an application pursuant to r 13.10 Federal Magistrates Court Rules 2001 is an interlocutory decision, requiring leave of the Federal Court to appeal: Rana v University of South Australia [2004] FCA 559 ; Gauci v Kennedy [2006] FCA 869. No leave to appeal has been sought. However this point in my view is moot because, as I indicated earlier in this judgment, both parties were of the view that the appeal be dismissed. The real issue before me is in relation to costs. 11 The Federal Court has jurisdiction to award costs, and as a general rule the award of costs is in the discretion of the Court: s 43 Federal Court of Australia Act 1976 (Cth). 12 As a general rule, costs of an application follow the event. A key reason for this is because, as pointed out by the Full Court in Cilli v Abbott (1981) 53 FLR 108 at 111, 'the object of costs is not to penalise; it is to indemnify the successful party in relation to expense to which he has been put by reason of legal proceedings'. This principle was adopted in Latoudis v Casey [1990] HCA 59 ; (1990) 170 CLR 534 per Mason CJ at 543, Toohey J at 563 and McHugh J at 567 in the context of both civil and criminal proceedings. 13 It is strongly argued by the respondent, on the basis of such authorities as MZWXC and MLGXAL that the appropriate course for the appellant to have adopted in the first place would have been to apply to have the decision of Jarrett FM set aside. I note from the notice of appeal that the appellant was unrepresented, or at least appeared unrepresented, at the time of filing, and he may not have understood that an application to set aside the judgment of 6 February 2006 was the proper course in the circumstances. Irrespective of this, the respondent has been put to expense by legal proceedings in the form of this appeal, and this appeal has now been rendered nugatory by the appellant successfully applying to have the original judgment set aside and a fresh application determined by the Federal Magistrates Court. 14 Before me this morning Mr Boccabella pressed that the appellant's case has merit, and that this should influence my approach to making a costs order in this matter. Counsel distinguished MZWXC and MLGXAL on this basis --- namely that the applications in those cases appeared to lack merit. In my view it is unnecessary to examine this issue in detail, other than to observe that it is clear that there is sufficient merit in the appellant's case to justify orders setting aside the decision of Jarrett FM of 6 February 2006, but that the merits of the appellant's application before Jarrett FM will be considered by Jarrett FM in his judgment in due course. All parties agree that this appeal should be dismissed because it has been overtaken by events at the appellant's instigation. The merits of the substantive case now before Jarrett FM are of little relevance in the context before me. 15 It is unfortunate that the parties could not reach agreement in relation to costs and avoid incurring further costs in relation to this matter. In my view, the circumstances of this case do not warrant departure from the usual order that costs should follow the event. Any other order would, in my view, not only be unjust to the respondent, but could also lead to unnecessary and difficult complications of requiring the costs of this appeal to follow decisions (including potentially appeal decisions) in another matter which is currently before Jarrett FM. In my view this would be inappropriate. The appeal be dismissed. 2. The appellant pay the respondent's costs of and incidental to the appeal, including reserved costs, if any, to be taxed if not agreed. | appeal rendered nugatory as federal magistrate's decision the subject of this appeal was subsequently set aside whether costs should follow the event costs |
2 He applied to the Department of Immigration and Multicultural and Indigenous Affairs for a Protection (Class XA) visa on 23 March 2006. On 15 May 2006 a delegate refused to grant the application and the Refugee Review Tribunal affirmed the delegate's decision on 31 July 2006. The Federal Magistrates Court set aside the delegate's decision on 17 July 2007 and remitted the matter to the Tribunal to be determined according to law. 3 A differently constituted Tribunal affirmed the delegate's decision on 30 November 2007. The Tribunal " did not find the applicant to be credible on some key aspects of his claims ". Instances were provided " of the inconsistencies, contradictions and implausibility that lead the Tribunal to conclude that the applicant is not a reliable witness in relation to certain aspects of his claims ". On 19 August 2008 the Federal Magistrates Court dismissed an application for review: SZJHE v Minister for Immigration [2008] FMCA 1299. 4 The Appellant now appeals to this Court. He appeared unrepresented during the course of the hearing on 24 November 2008, although he did have the benefit of an interpreter. He had also filed on 19 November 2008 a written Outline of Submissions . The Refugee Review Tribunal failed to establish a connection between my claim of persecution and the country information about the LTTE under the Migration Act: Particulars A. They were in the government's wanted list. The Refugee Review Tribunal made the decision in bad faith: Particulars A. The Tribunal made the decision in bad faith by making the following comment that: i) the Tribunal did not find the applicant to be credible on some key aspects of his claims; and ii) the Tribunal did not accept that the applicant was of adverse interest to the Indian authorities. 2. The decision of the Refugee Review Tribunal did not give any weight to the response that I lodged under s424A of the Migration Act: Particulars A. The Tribunal asked me to provide a response for couples of things and I promptly response of those things that the Tribunal came into my attention. However the Tribunal did not give any weight to those documents and just came into conclusion whatever had to its mind. These Grounds of Appeal are a substantial repetition of the grounds as advanced before the Federal Magistrates Court. The Appellant's written submissions also substantially repeat that which is otherwise set forth in the Grounds of Appeal . 6 The purported " Grounds ", it may be noted, only direct attention to perceived deficiencies in the decision of the Tribunal. No ground is directed to any appellable error alleged to have been made by the Federal Magistrates Court. 7 The appeal should be dismissed on that basis alone. Such a fundamental deficiency in a notice of appeal is not a mere matter of form; no original jurisdiction is vested in this Court to review errors perceived to have been committed by the Tribunal: SZLZM v Minister for Immigration & Citizenship [2008] FCA 1263. In Sathiyanathan v Minister for Immigration & Multicultural Affairs [2000] FCA 210 , Finn, Marshall and Goldberg JJ likewise emphasised the appellate role of this Court. The two errors now ascribed [to] her Honour's decision are that she failed to find (i) that the Tribunal did not address whether by reason of all of the claims made by the appellant, including those relating to events prior to 1997, the appellant had a well-founded fear of persecution for a Convention reason; and (ii) that the Tribunal erred in asking whether all Tamils would have such a well-founded fear. We should state at the outset that we do not consider there is substance in either ground. We would add that much of the appellant's submissions were directed to the proposition that the Tribunal had made errors in the way it had considered the evidence and issues before it. Although this occurred under the rubric of a consideration of the primary judge's reasons it was of little assistance in understanding why it was said that the primary judge fell into error. The Court wishes to emphasise that an appeal to the Full Court in a refugee matter should not be taken as an occasion to re-consider the Tribunal's reasons as distinct from considering the primary judge's reasons. 8 Even if the Notice of Appeal had been construed as a contention that the Federal Magistrates Court erred in not concluding that the Tribunal had committed one or other of the errors alleged, the appeal still would have been dismissed. 9 Any failure on the part of the Tribunal to " establish a connection " between the claim of persecution and the country information is essentially either a challenge to the factual conclusions as made by the Tribunal or a challenge to its reasoning process. On either basis, no jurisdictional error is established by any such failure. 10 The Tribunal addressed the claim as made by the now Appellant as to the LTTE and made a finding against him. Same day my Colombo business friend's brother telephoned me to my office at Chennai and related to me how his brother was arrested by the police in Colombo. He said that the police arrested his brother as they have found that the material I exported to him to make uniforms for LTTE and the medicine were used by the LTTE to treat their cadres who injured due to armed attacks on Sri Lankan Defence Forces. The person who telephoned said that I should be careful because the Tamil Nadu Police might come to question me over the supplies. It rejected the now Appellant's claims on the basis of adverse findings as to credibility. Given that the Tribunal does not accept that the applicant was arrested as claimed, the Tribunal does not accept that the applicant is of adverse interest to the Indian authorities. The Tribunal is not satisfied that the applicant is on any 'wanted list' in India. The Tribunal is not satisfied that the applicant's business was affected, as claimed. There is no credible evidence on which the Tribunal could find the applicant stands at risk of suffering serious harm in the reasonably foreseeable future if he returns to India. No case was sought to be advanced that the claim had not been addressed. The conclusion of the Tribunal was a finding of fact disclosing no error, let alone jurisdictional error. 11 The contention that the Tribunal made a decision in " bad faith " is likewise to be rejected. An allegation of " bad faith " is serious ( SCAS v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCAFC 397) and cases in which " bad faith " will be established " will be rare and extreme and claims of bad faith must be clearly particularised ": Haritopoulos Pty Ltd v Deputy Commissioner of Taxation [2007] FCA 394 at [32] , [2007] FCA 394 ; 66 ATR 225. A tribunal member cannot blunder into bad faith, no matter how stupid and careless the tribunal member is, any more than a person can blunder into deceit... What is required to make out this case is to find that the tribunal member was recreant to his duty by wilfully and deliberately making the impugned decision without attempting to carry out the statutory duty lying upon him -- tossing a coin without reading the file, allowing in every third applicant, or allowing in applicants from various countries in rotation might be examples. This decision has since been followed by Finn J in SZHAH v Minister for Immigration & Multicultural Affairs [2006] FCA 1012 at [17] . " The presence or absence of honesty will often be critical ": SBBS v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 361 at [43] , 194 ALR 749 at 756 per Tamberlin, Mansfield and Jacobson JJ. " Bad faith ", Allsop J has further observed, " is not just a matter of poor execution or poor decision-making involving error. It is a lack of an honest or genuine attempt to undertake the task in a way meriting personal criticism of the Tribunal or officer in question ": NAAG of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 713 at [24] , [2002] FCA 713 ; 195 ALR 207 at 215. His Honour there rejected a submission that " enabled objective bad faith to be found without the need for personal fault on the part of the decision-maker ". Similarly, in SBAP v Refugee Review Tribunal [2002] FCA 590 at [49] , Heerey J observed that " bad faith is a serious matter involving personal fault on the part of the decision-maker going beyond the errors of fact or law which are inevitable in any such process. As such, it is an allegation not to be lightly made and must be clearly alleged and proved ". See also: SZJVA v Minister for Immigration & Citizenship [2008] FCA 1631 at [47] per McKerracher J. 12 An instance of a decision of the Tribunal not having been made in good faith is provided by SAAG v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 547. It was there concluded that the lack of good faith was established because the Tribunal had looked for reasons to reject the claim being advanced. However, in this matter I have concluded that the Tribunal's decision was not made in good faith. I have reached that conclusion by inference from my consideration of the Tribunal's reasons as a whole, and not by taking any particular part of its reasons in isolation. I will not repeat the analysis of the Tribunal's reasons discussed above. In my judgment, its reasons go beyond the Tribunal making findings of fact or making observations which involve it making errors of fact or law, or simply reaching views which lack logic or which are wrong. The firm persuasion which I hold is that the Tribunal approached its review of the applicant's claims on the basis that it should look for reasons why it could reject those claims. In other words, in my judgment, its reasons overall show that it did not address the applicant's claims by asking whether he has a well-founded fear of persecution for a Convention reason, but in substance by asking whether there was evidence which would enable it to reject the applicant's claims. That conclusion is reached notwithstanding that in its consideration of the definition of "refugee" it has referred to the relevant decisions of the High Court and notwithstanding that, at the commencement of the "findings and reasons" section of its decision the Tribunal quotes the observations of Gummow and Hayne JJ in Abebe [v Commonwealth [2004] HCA 32 ; (1999) 197 CLR 510] at 577---578 set out in [29] above. At no point in its reasons thereafter do those considerations appear to attract any attention. Instead, each of the factors upon which the Tribunal relied to reject the applicant's claim as to his nationality demonstrates upon analysis in the ways I have referred to above a rigid and at times inexplicable finding adverse to him. But such is not the present case. 13 The " particulars " provided in the Notice of Appeal presently under consideration in respect to " bad faith " are but disagreement with findings of fact which are entrusted to the Tribunal alone to make. Those findings fall well short of establishing " bad faith " -- or, for that matter, any other form of jurisdictional error. 14 The final purported " Ground of Appeal " is without substance. Two answers may be provided for reaching this conclusion. First, it is not correct to contend that the Tribunal " did not give any weight to the response " provided by the now Appellant. The exchange of correspondence to which this purported Ground is directed is the s 424A letter forwarded on 26 October 2007 and the response provided by way of a letter dated 16 November 2007. The s 424A letter set forth a number of inconsistencies in the account of the facts then provided and the now Appellant's November 2007 letter in reply addressed each of those matters. The exchange of correspondence was set forth by the Tribunal in its reasons for decision and the Tribunal thereafter proceeded to record its findings. The Tribunal " did not find the applicant to be credible on some key aspects of his claims ". A contention that the Tribunal gave no " weight " to the response cannot be sustained in circumstances where the response was expressly referred to in the Tribunal's account of the facts and again in its findings. The Tribunal may not have given the now Appellant's response such persuasive " weight " as he may have desired; but the response was considered -- and rejected. 15 The second basis for concluding that this purported Ground is without substance is that it is no part of the function of the Federal Magistrates Court when reviewing a decision of the Tribunal, or for this Court on appeal, to question the " weight " given by the Tribunal to particular facts or considerations. That is a matter for the Tribunal alone. The limited role of a court reviewing the exercise of an administrative discretion must constantly be borne in mind. It is not the function of the court to substitute its own decision for that of the administrator by exercising a discretion which the legislature has vested in the administrator. Its role is to set limits on the exercise of that discretion, and a decision made within those boundaries cannot be impugned... It follows that, in the absence of any statutory indication of the weight to be given to various considerations, it is generally for the decision-maker and not the court to determine the appropriate weight to be given to the matters which are required to be taken into account in exercising the statutory power... I say "generally" because both principle and authority indicate that in some circumstances a court may set aside an administrative decision which has failed to give adequate weight to a relevant factor of great importance, or has given excessive weight to a relevant factor of no great importance. The preferred ground on which this is done, however, is not the failure to take into account relevant considerations or the taking into account of irrelevant considerations, but that the decision is "manifestly unreasonable". It is also to be recalled that a principal reason provided by the Tribunal in the rejection of the claims being made was its conclusion that the now Appellant was not " credible " and was " not a reliable witness ". Such findings, it has been said, are findings " par excellence " entrusted to the decision-maker: Re Minister for Immigration and Multicultural Affairs; Ex parte Durairajasingham [2000] HCA 1 , 168 ALR 407. However, this was essentially a finding as to whether the prosecutor should be believed in his claim -- a finding on credibility which is the function of the primary decision-maker par excellence. If the primary decision-maker has stated that he or she does not believe a particular witness, no detailed reasons need to be given as to why that particular witness was not believed. The tribunal must give the reasons for its decision, not the sub-set of reasons why it accepted or rejected individual pieces of evidence. In any event, the reason for the disbelief is apparent in this case from the use of the word "implausible". The disbelief arose from the tribunal's view that it was inherently unlikely that the events had occurred as alleged. No greater reasons need have been provided by the Tribunal in the present proceeding for its conclusions; nor need the Tribunal have explained what " weight " it gave to the November 2007 response. 16 Notwithstanding the form of the Notice of Appeal , independent consideration has been given to the reasons provided by the Federal Magistrates Court. No appellable error has been discerned. 17 The appeal must be dismissed with costs. The Notice of Appeal as filed on 3 October 2008 is dismissed. 2. The Appellant is to pay the costs of the First Respondent. I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Flick. | review sought of tribunal's decision no error alleged against decision of federal magistrate appeal dismissed impermissible merits review bad faith application dismissed migration |
That is effected in paragraph 1 of the notice of motion. Paragraph 2 of the notice of motion is not pressed. The motion is not opposed by the respondent by reference to any asserted prejudice. Mr de Kerloy, appearing for the respondent, has simply put before the Court matters, which in his submission, the Court ought be informed in the process of making its reasoned judgment as to whether or not the motion ought be granted. 2 The motion is supported by affidavits of Dr Rajumati Bhula affirmed on 2 and 15 December 2008. The respondent has filed an affidavit of Dr Ross Rainbird sworn 12 December 2008. It is the fact, as is evident from the judgment at first instance, that the name and address of the manufacturer in relation to products, the subject of entry in the relevant record of the register, were in each case fictitious. 3 The appellant acknowledges rightly that it needs to demonstrate special circumstances in order to take it out of the ordinary course of how appeals in this Court are disposed of. • The continued approval of the active constituents and registration of the chemical products is based on technical information that is subject to doubt, and the potential adverse consequences are poisonings of humans or animals and environmental contamination. • If the APVMA's contention on the appeal is correct (so that the entries should be treated as invalid) then the prosecution of the appeal as a necessary step leading to the deletion of the entries is a matter of urgency, because fresh importations and sales of the active constituents and chemical products should cease, at least until determinations can be mad eon the fresh applications by the respondent. • An expedited hearing would be consistent with the objectives of the regime (see the preamble to the Agvet Act and the Agvet Code Act). • In support of the new grounds of appeal added by supplementary notice of appeal dated 20 November 2008, the APVMA has notified the respondent that it will rely on fresh evidence that was not adduced in the proceeding below: the appellant contents that this information would have changed the outcome. 5 It is then said that the continued approval of the active constituents and registration of the chemical products is based on technical information that is subject to doubt and the potential adverse consequences are of poisoning of humans, of animals, and environmental contamination. 6 Accordingly, at first blush, the matter seems to be one of grave concern to the appellant and, of course, the public interest, in the performance of the obligations of the appellant in protecting under the powers vested in it under the legislation of humans, animals and the environment. When pressed on the matter, counsel for the appellant acknowledged that in the range of available risks, the present concern of the appellant may be characterised as speculative. Nonetheless, it is submitted by the appellant that the presence of even that risk and the desirability of mitigating it, is a proper basis for the expedition of the appeal. I do not agree. The absence of any material risk is, apart from any other considerations, including the concession made by counsel to which I have referred, also manifest by the failure by the appellant to take any action available to it under the legislation to protect humans, animals or the environment, such as the very interventionist powers available under s 102(1)(a)(ii) and (iii) of the Agricultural and Veterinary Chemicals Code Act 1994 (Cth) to recall products for that very reason. 8 I do not consider that relevant special circumstances exist for the expedition of this appeal. There are many litigants before the Court awaiting disposition of their appeals. The interests of justice demand that the Court dispose of appeals in a fair and equitable manner. For these reasons, I refuse the motion. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gilmour. | notice of motion for expedition of appeal no special circumstances motion dismissed. practice and procedure |
2 At the commencement of the hearing of the applicant's application for an interlocutory injunction on 21 March 2006 each of the parties made an application that publication of the names of the applicant and the deponents to two affidavits each dated 14 December 2005, which were annexed to the applicant's affidavit of 17 March 2006, be suppressed. I made the orders suppressing publication of the names of the applicant and the two deponents until Monday, 27 March 2006. I further ordered that the University serve a copy of the suppression orders on the media outlets so that the media outlets could have an opportunity to make submissions against the continuation of the suppression orders. 3 At the end of the hearing on 21 March 2006, I also made an order that until 27 March 2006 the public not be permitted to have access to the Court file. On 24 March 2006, I made an order in Chambers that until further order the name of the applicant in this proceeding be substituted with the letter 'Y'. 4 At the commencement of the hearing of this application I granted leave to Ms Galati to appear on behalf of The West Australian newspaper and The Australian newspaper ('the newspapers'). 5 At the conclusion of the hearing of this application on 27 March 2006, I reserved my judgment and made orders continuing the suppression orders until further order. I also made orders precluding members of the public from inspecting the applicant's affidavit of 17 March 2006 until further order. 6 The background to the substantive application is contained in my reasons for granting the interlocutory injunction ( Y v The University of Western Australia [2006] FCA 403). I do not intend to repeat all of the matters which are recorded in those reasons. However, it is necessary to explain that the applicant is a professor employed by the University. The applicant has brought a substantive application for declarations and to enjoin the further proceedings of the Misconduct Investigation Committee. This committee was constituted by the University pursuant to Schedule D of the certified agreement, which binds the University and the applicant. Schedule D of the certified agreement sets out the procedure that must be followed for the taking of disciplinary action on the grounds of serious misconduct by the University against a member of the academic staff. 7 The Misconduct Investigation Committee was established by the University in January 2006 to investigate allegations made that the applicant is guilty of serious misconduct, which includes allegations that he has engaged in sexual harassment. The details of the allegations of sexual harassment and other misconduct made against the applicant are contained in two affidavits. Each of these affidavits has been made by each of the two deponents whose names have been suppressed. These affidavits were not made by the deponents thereto for the purpose of adducing evidence in this proceeding. These are documents which came into existence on 14 December 2005 at the instance of officers of the University for the purpose of being used in proposed disciplinary proceedings to be taken by the University against the applicant. These disciplinary proceedings were first brought against the applicant before the Sexual Harassment Review Panel, a body constituted under the University's Sexual Harassment Policy. The Sexual Harassment Policy provided that the hearings before the Sexual Harassment Review Panel were to be in private and that the participants were to keep the information about the proceedings before the Panel confidential. 8 The applicant first came into possession of the affidavits in December 2005 when the University informed him that his conduct was to be reviewed by the Sexual Harassment Review Panel. The University supplied him with the affidavits because they contained the allegations of sexual harassment made against him. The deponents of the affidavits are fellow members of the academic staff of the University who work in the same department as the applicant. After its proceedings were completed the Panel recommended that the University activate the disciplinary proceedings against the applicant under Sched D of the certified agreement. 9 I will hereafter refer to the two deponents to these affidavits as the complainants, but I should mention that they are not making the complaints against the applicant in their own right. It is the University, as employer, that is pursuing disciplinary proceedings under the certified agreement. I should also mention that at the time that the University moved to establish the Misconduct Investigation Committee, it suspended the applicant from his position pending the outcome of the investigation and any consequential disciplinary action that may be taken. 10 The complainants' affidavits contain detailed accounts of events and conversations between each of the complainants and the applicant over a number of years. The first of the events recorded in one of the affidavits goes back to 1991. The affidavits also contain statements about students and members of staff of the department in which the applicant and the complainants work, who have nothing to do with this case. The material contained in the affidavits is detailed and, although some of it does not relate to sexual harassment, it is of a highly personal nature, and its publication would be extremely embarrassing to the applicant, the complainants and to the other persons mentioned therein who have nothing at all to do with this case. 11 The applicant applied for an interlocutory injunction restraining any further proceedings of the Misconduct Investigation Committee until further order. The main complaint made by the applicant was that he had not been given sufficient particulars of the allegations made against him and that the Misconduct Investigation Committee did not intend to give him an opportunity to question the complainants as to the content of their affidavits. The applicant claimed that the University had, therefore, failed to comply with the certified agreement, and was threatening to continue to do so. On 21 March 2006, I granted an interlocutory injunction in the terms sought by the applicant. 12 As mentioned, the complainants' affidavits have come before this Court as exhibits to the affidavit of the applicant dated 17 March 2006 which was relied upon by him in support of his application for the interlocutory injunction heard on 21 March 2006. During the hearing, however, counsel did not disclose the contents of the complainants' affidavits in the course of presenting their respective cases. Counsel did, however, refer during submissions to the names of the complainants. Accordingly, any person who was sitting in Court during the hearing of the interlocutory injunction application would be aware of the names of the applicant and the complainants, but would not be aware of the detailed content of the affidavits of the complainants. 13 The issues which arise for determination in this application are whether the order suppressing publication of the names of the applicant and of the two complainants should be continued and, whether I should make an order permitting inspection of the applicant's affidavit of 17 March 2006. 14 I deal firstly with the question of whether publication of the name of the applicant should continue to be suppressed. The applicant's counsel relied upon the fact that the applicant is a professor with a national and international reputation. Counsel for the applicant submitted that if the applicant's name was not suppressed it would be highly embarrassing and would be likely to damage his reputation irreparably and this could also have adverse ramifications for persons for whom the applicant has acted as a referee. It could also cause the applicant financial harm. Counsel argued that this would be unfair because the disciplinary process was intended to be confidential and the Misconduct Investigation Committee had not made any adverse finding in respect of his conduct, yet the applicant had been forced to bring this proceeding because of the alleged failure on the part of the University to comply with the certified agreement. 15 Counsel for the newspapers argued that in determining whether to make an order under s 50 of the Act the Court had to consider whether it was necessary to suppress the name of the applicant to prevent the prejudice to the administration of justice. Counsel submitted that the potential embarrassment and damage to the reputation of the applicant was not by itself a sufficient basis on which to suppress publication of his name on this ground. Counsel submitted that the principle of open justice contemplated the reporting of court proceedings, even when there were embarrassing and damaging allegations made in the course of those proceedings. Counsel also submitted that the University was a publicly funded institution and there was a public interest in knowing that allegations of sexual harassment had been made by the University against a senior member of its academic staff. At an interlocutory hearing, the AAT made an order suppressing the publication of Mr Williams' name. Mr Williams appealed to this Court against an interlocutory decision of the AAT in relation to whether the Australian Taxation Office had provided sufficient particulars of its claims in support of the amended assessment. The primary judge made a suppression order suppressing Mr Williams' name in order to give 'practical effect' to the suppression order of the AAT. There was an appeal against that decision and the Full Court allowed the appeal. 21 In the Full Court, Merkel J (with whom Finn and Stone JJ agreed) drew a distinction between the role of the AAT as a 'layer' of administrative decision-making in the Commonwealth and the exercise by the Court of the judicial power of the Commonwealth. Section 50 is concerned with prejudice in respect of the exercise by the court of the judicial power of the Commonwealth, rather than prejudice in respect of the exercise by the AAT of the administrative power of the Commonwealth. Maintaining or, as the primary judge put it, "giving practical effect" to Williams' statutory entitlements to privacy and confidentiality in relation to the application for administrative review in the AAT may, or may not, be necessary in order to prevent prejudice to the exercise by the a AAT of its powers but cannot, standing alone, be necessary in order to prevent prejudice to the exercise by the court of its judicial powers. Such considerations have never been regarded as a reason for the closure of courts, or the issue of suppression orders in their various alternative forms:...A significant reason for adhering to a stringent principle, despite sympathy for those who suffer embarrassment, invasions of privacy or even damage by publicity of their proceedings is that such interests must be sacrificed to the greater public interest in adhering to an open system of justice."... If that situation arises it can be weighed in the discretionary balance that is to be struck between the public interest of open justice and preventing prejudice to the administration of justice. However, that situation has not arisen in the present matter. However, the weight that will be accorded to these factors will depend very much on the circumstances of each case. There is no evidence in this case that the applicant would, in the absence of a suppression order being made, be prevented or deterred from continuing this proceeding. Nor is there evidence that there is a real risk that this may occur. It follows that embarrassment and potential damage to the reputation of the applicant, standing alone, will not satisfy the requirements of s 50 of the Act to justify the making of a suppression order. These principles apply whether the hearing is final or interlocutory. 25 Further, in this case, by invoking the jurisdiction of this Court, the applicant has obtained the benefit of an interlocutory injunction. The risk that it would become public knowledge that there were embarrassing disciplinary allegations made against him by the University did not deter the applicant from commencing this proceeding and applying for interlocutory injunctive relief. 26 It follows that the order made on 27 March 2006 suppressing the publication of the name of the applicant until further order should be discharged. I also discharge the order of 24 March 2006 substituting the name of the applicant in this proceeding with the letter 'Y'. 27 I deal next with the question of whether the suppression order in relation to the names of the two complainants should be discharged. As mentioned above, the complainants are not deponents in this proceeding. However, the statements which they have made in the form of affidavits are the basis on which disciplinary charges have been brought against the applicant by the University. The names of the complainants also appear in the body of the applicant's affidavit of 17 March 2006 and in several of the letters comprising exhibits to the affidavit, including a crucial letter of 2 March 2006 from the University. This letter was the subject of considerable debate by counsel at the hearing of the application for the interlocutory injunction. Further, as mentioned, the names of the complainants were mentioned by counsel in open court during that hearing. 28 The University submitted that the order suppressing publication of the names of the two complainants should be continued. The University relied on the affidavit of 24 March 2006 of Mr Robert Bruce Farrelly, the Director of Human Resources at the University. Mr Farrrelly deposed that during August 2005 to November 2005, following complaints, which included complaints about sexual harassment, from members of staff in the relevant School, interviews were conducted by Ms Beverley Hill with members of staff from that School, as part of an inquiry by the University. Ms Hill was, at the material time, an employee of the University, with the title of Manager, of Equity and Diversity, reporting to Mr Farrelly. These interviews were conducted on the basis of the assurances by Ms Hill, on behalf of the University, that the names of interviewees would not be disclosed outside of the disciplinary processes of the University which were to be conducted confidentially and in private. It was those interviews which ultimately led to the complainants making the affidavits of 14 December 2005. Ms Hill subsequently prepared a report dated 7 November 2005 which contained her findings. An edited version of that report is also an exhibit to the applicant's affidavit of 17 March 2006. 29 Mr Farrelly also deposed that as Director of Human Resources, he was concerned that unless confidentiality was maintained, members of staff who make complaints of sexual harassment, will be fearful of suffering reprisals, shame and humiliation. He also said that if the University was not able to maintain confidentiality, the University would not be able to address matters that arose from Ms Hill's inquiry or generally take steps to address misconduct in the workplace and ensure a safe working environment. 30 Mr Farrelly does not identify which matters from Ms Hill's inquiry the University will not be able to address, nor the reasons why it will not be able to do so. There is no evidence, however, that if the suppression order on the names of the applicant and the two complainants is lifted, that the Misconduct Investigation Committee will not be able to conclude its current investigation into the applicant's conduct, nor that the disciplinary procedures currently being conducted in relation to the applicant under Schedule D of the certified agreement will not otherwise be able to reach finality. In this regard, I record that I adjourned this application to give the University an opportunity to inquire of the two complainants whether they wished to be independently represented and put evidence before the Court in their own right. My associate was advised that the two complainants did not wish to avail themselves of that opportunity. 31 Senior counsel for the University submitted that the position in this case was distinguishable from that in Williams in that the privacy and confidentiality regime in Williams was based on statute and the orders of the AAT. However, in this case the information was given by the complainants pursuant to a confidentiality undertaking given by the University, which was of such a nature as would attract the protection of equity. This was, submitted senior counsel, a sufficient basis on which to make a suppression order under s 50 of the Act because the proper administration of justice required the preservation of confidentiality undertakings. Senior counsel also submitted that the case of Australian Broadcasting Commission v Parish (1980) 43 FLR 129 (' Parish' ) was an authority which supported this proposition. 32 Further, senior counsel submitted that there is a prejudice to the administration of justice if persons are discouraged from raising complaints about sexual harassment. 33 Counsel for the newspapers submitted that the Court was not bound to give effect to private arrangements in relation to confidentiality in determining whether to make a suppression order under s 50 of the Act. Counsel referred to Johnston v Cameron [2002] FCAFC 251 ; (2002) 124 FCR 160 as an instance where the Court had refused to make a suppression order in respect of information before a union inquiry, notwithstanding that there was evidence that the information was being treated as confidential by union officials investigating allegations of sexual assault against a prominent union official. Relying further on Johnston , counsel also submitted that there was nothing inherently confidential about the names of the complainants nor the descriptions of their dealings with the applicant. 34 Counsel also submitted that whether a suppression order was necessary to prevent prejudice to the due administration of justice should be assessed by reference to whether the exercise of judicial power before this Court would be prejudiced, and not whether proceedings before some other institution may be prejudiced. 35 In Williams , the Full Court found that the primary judge was in error in making a suppression order under s 50 of the Act on the grounds of seeking to give 'practical effect' to the privacy and confidentiality entitlements that Mr Williams was entitled to in the AAT proceedings, without assessing whether it was necessary to suppress the publication of Mr Williams' name to prevent prejudice to the administration of justice in this Court. 36 I do not accept the submission of senior counsel for the University that the Williams case is distinguishable from this case, in that the respective confidentiality and privacy regimes were founded on different bases. The gravamen of the decision in Williams was not whether the basis of the existing confidentiality regime was to be found in statute or common law or equity, but whether it was necessary to maintain that regime in order to prevent prejudice to the administration of justice in this Court as opposed to the forum which was the source of the existing confidentiality regime. In essence, in seeking to prevent publication of the names of the complainants, the University seeks to perpetuate in this Court the privacy and confidentiality regime which prevails as part of its process for investigating serious misconduct under the processes contemplated by the Sexual Harassment Policy and the certified agreement. This emerges from the evidence of Mr Farrelly who refers to the privacy and confidentiality provisions of the Sexual Harassment Policy and to the potential difficulty in the implementation of that policy if the confidentiality as to the names of complainants generally is not preserved. In my view, the University is asking this Court to give effect to the confidentiality and privacy regime under its Sexual Harassment Policy and the certified agreement, in the same way as Mr Williams asked the primary judge to give effect to his confidentiality and privacy entitlements before the AAT. There is, therefore, in my view, no material distinction between the approach advanced by the University and the approach taken by the primary judge in Williams which was identified by the Full Court as erroneous. I am bound by the decision in Williams . 37 Further, I do not accept senior counsel's submissions that Parish is an authority for the proposition that the Court will grant suppression orders pursuant to s 50 of the Act to protect confidential undertakings generally because the making of such orders is necessary to prevent prejudice to the administration of justice. I agree with the analysis of Parish by Weinberg J in Johnston at first instance [2002] FCA 948 at [82] that the reason that a suppression order was made in that case was to prevent the proceeding then before the Court from being rendered nugatory. In this case, whilst the disclosure of the names of the applicant and the two complainants would cause embarrassment, it would not render the proceeding nugatory. 38 It follows that I am required to approach the question as to whether an order under s 50 of the Act suppressing publication of the names of the complainants should be made, by reference to whether such an order appears to be necessary to prevent prejudice to the exercise of administration of justice in this Court, and not in another forum or institution. 39 As mentioned, Mr Farrelly has deposed that he is concerned that if the names of complainants under the University's Sexual Harassment Policy are not kept confidential this will have adverse consequences for the enforcement of the University's Sexual Harassment Policy in the workplace. This is a legitimate concern. However, because that concern relates to the conduct of disciplinary proceedings in an institution other than this Court and does not relate to the exercise of judicial power in this Court, it does not fall within the ambit of the factors identified by the Full Court in Williams as being factors to which regard may be legitimately be had in determining whether to make a suppression order under s 50 of the Act. 40 As to the wider argument by senior counsel for the University that the failure to suppress the names of the complainants may lead to persons in general being less likely to report sexual harassment, this is a variant of the argument founded on the potential for embarrassment of a party or a witness by the disclosure of that person's name. As mentioned, the extent to which embarrassment and distress may lead to the making of a suppression order under s 50 of the Act, in any proceeding, must be assessed by reference to the application of the principles in Williams , to that proceeding. In other words, the question of whether to make a suppression order under s 50 of the Act is not to be assessed by reference to broad public policy considerations, but by reference to the extent to which, on the evidence, the administration of justice may be prejudiced in any specific proceeding by not making the order. As stated above, it is established on the authorities that embarrassment, standing alone, is not sufficient for the making of an order under s 50 of the Act. 41 As mentioned, the names of the complainants appeared in the body of the applicant's affidavit and in documents, including a crucial letter of 2 March 2006, which were in evidence, and to which reference was made, at the hearing of the interlocutory injunction. Further, the names of the complainants were mentioned in open court during the hearing. Applying the principles in Williams , there is no evidence before me which permits me to conclude that it is necessary to suppress the publication of the names of the complainants in order to prevent prejudice to the administration of justice within the meaning of s 50 of the Act. I would, therefore, discharge the order which I made on 27 March 2006 suppressing the publication of the names of the two complainants. 42 I turn now to the application by counsel for the newspapers that the newspapers be permitted to inspect the affidavit of the applicant dated 17 March 2006 and all of its exhibits. This application if granted would permit the newspapers to inspect the complainants' affidavits. 43 Counsel for the newspapers argued that the newspapers should be given access to the whole of the affidavit of the applicant of 17 March 2006, including the complainants' affidavits, because this would assist the newspapers in being better able to understand and report upon the proceeding. Counsel also relied upon the public interest in open justice. Senior counsel for the University opposed the application by the newspapers on the grounds that the complainants' affidavits were made in circumstances of confidentiality. 44 The position in relation to the inspection by non parties of affidavits filed at the Court is governed by O 46 r 6(3)(a) of the Federal Court Rules ('the Rules'). This rule provides that non parties must not inspect affidavits filed in any proceeding 'except with the leave of the Court or a Judge'. The rule does not distinguish between those affidavits which have been filed and introduced into evidence in open court and those affidavits which have been filed but not yet been relied upon in open court. 45 The contrast between s 50 of the Act and O 46 r 6(3) of the Rules is of some interest. The practical effect of the operation of these provisions is that, in hearings where evidence is given on affidavit, unless the whole of an affidavit is read out in open court, a member of the public will not, by being present at the hearing, know the content of all the evidence before the Court. By being present in Court, the interested member of the public will only be able to know, and to report on, the evidence insofar as it is disclosed in open court. In order to obtain access to the content of the evidence which is contained in affidavits introduced into evidence but not read out in open court, the interested member of the public will need to obtain the leave of the Court under O 46 r 6(3) of the Rules. In my view, the difference between those two provisions accords recognition to the paramount importance of the principle that the courts are open to the public and what is said and done in the courts should be able to be reported by the media as the representatives of the public; but it also recognises that, even in respect of an affidavit which is introduced into evidence, there may be information in the affidavit which is not disclosed in open court, which should remain private. By contrast with s 50 of the Act, O 46 r 6(3) of the Rules, imposes no constraint on the factors to be considered in determining whether to continue the privacy protection for the content of an affidavit or to permit public access to the affidavit. 46 I agree, however, with respect, with the observations of Sackville J in Seven Network Limited v News Limited (No 9) [2005] FCA 1394 that in exercising the discretion under O 46 r 6(3) of the Rules, considerable weight will be given to the principle of open justice. Further, a court is more likely to grant access to affidavits which have been admitted into evidence at a hearing than to affidavits which have been filed with the court but have not been admitted into evidence (see French J in Australian Securities and Investments Commission, in the matter of Richstar Enterprises Pty Ltd (ACN 099 071 968) v Carey No 2 [2006] FCA 407 at [17] ). It will only be in exceptional cases that access will not be granted where an affidavit has been admitted into evidence (see Macquarie Radio Network Pty Ltd v Australian Broadcasting Authority [2002] FCA 1408 at [20] ). Nevertheless, each case must be considered in the context of its own circumstances. 47 There are three factors which must be placed on the scale to be weighed against the public interest in open justice in this case. The first factor is that the complainants' affidavits contain highly personal information which concerns both themselves and several other persons, including students and academic staff at the University. This information would be highly embarrassing to the complainants and to those other persons mentioned in the affidavits - none of whom are parties to this litigation. There is no doubt that the candour of the information in the affidavits would have been induced by the complainants' belief that the information would not be made public. The applicant's affidavit also has as an exhibit the report of Ms Hill on the results of her investigation into the relevant School, and, although this is an edited document, it also contains much information of an embarrassing private nature affecting many people who have nothing to do with this case. Secondly, the information in the complainants' affidavits and Ms Hill's report was not revealed in open court. Neither counsel referred to the contents of these documents during the hearing. This is not a case where access to the complainants' affidavits and Ms Hill's report would permit the media to report accurately the evidence which was given or referred to in open court. Thirdly, this Court is not concerned in the substantive application with the merits of the allegations made by the University against the applicant. The substantive application is about whether the Misconduct Investigation Committee is acting, or proposes to act, in breach of the provisions of the certified agreement and in accordance with procedural fairness. It is about process not merits. The Court has not considered, nor will it consider at the hearing of the substantive application, the merits of the allegations against the applicant. Accordingly, in weighing the factors, I am of the view that the factors supporting the protection of privacy and dignitas of persons who are not parties to this litigation, but who have become unwittingly involved in it, outweigh the public interest in open justice, insofar as access to the complainants' affidavits and Ms Hill's report is concerned. The public interest in open justice will be sufficiently met by the newspapers having access to the applicant's affidavit and exhibits, other than Exhibits MM-1, MM-2 and MM-3 - being the complainants' affidavits and the report from Ms Hill. The general nature of the allegations that are made against the applicant are contained in letters from the University dated 6 January 2006 and 2 March 2006 which are exhibits to the affidavit. Further, the affidavit reveals the correspondence between the applicant and the University which identifies the applicant's complaint of unfairness in the University disciplinary process. Bearing in mind that this application is about process and not merits, it will be possible for the newspapers to comprehend and report upon the substance of the proceeding without having access to the detail contained in the complainants' affidavits and Ms Hill's report. 48 Accordingly, I will discharge my order made on 27 March 2006, precluding non parties from having access to the applicant's affidavit of 17 March 2006. I will also order that the newspapers be permitted to have access to the affidavit of the applicant dated 17 March 2006 and the exhibits thereto, other than Exhibits MM-1, MM-2 and MM-3. I will hear counsel on costs. I certify that the preceding forty-eight (48) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis. | suppression orders university inquiry into allegations of serious misconduct allegations of sexual harassment inspection of exhibits to affidavit practice and procedure |
I will give my reasons now. Later they will be written down for anyone who wants to read them. 2 The Court is sitting here today on the Yakka Yakka Track south of Balgo to hear an application for the determination of native title. We are sitting in this country at the request of the applicants who want the Court to sit here because it overlooks part of the claim and it includes Nyili, Emily Springs, which is a very important part of the claim, where there is fresh water. 3 The land covers 229, 718 square kilometres. It is in the Great Sandy Desert south east of the Kimberley and part of it touches the Northern Territory border. It is surrounded by other areas for which native title has been determined; Kiwirrkurra to the south, Tjurabalan to the north and Martu to the west. The applicants' claim group is called Ngururrpa, a word which in English means "central". Thus you people are central people and this is the central land. 4 The claim group is about 1300 people and I think many of them must be here today. They are descended from 56 ancestors, all of whom we know about. The only parties to this case are the applicants, the Ngururrpa people, and the State of Western Australia. Through mediation --- through good talking --- they have reached agreement that there should be a native title determination and they have agreed on the orders. They cover the whole of the land claimed except one little bit, which was a mistake. That part is too small to worry about. 5 The law provides that the Federal Court can make a determination of native title in certain cases without having a hearing, without taking months and months to hear a big case. I am satisfied that the conditions that the law requires have been met and that the order that you want is within the power of the Court to make. 6 In considering whether the Court should make the order as appropriate, I have taken into account that the Native Title Act 1993 (Cth) encourages what you have done --- to resolve native title cases by agreement without the need for a hearing. I have taken into account the benefits that come when people do agree to resolve their differences. I have taken into account, too, the very detailed and very good prepared material filed with the Court by the people, and their lawyers, as part of the application, and the very good joint submission put before the Court on behalf of the claim group and the State of Western Australia in support of the application. 7 The parties have also put forward a summary of The Countrymen Report ; that is Scott Cane's book --- three volumes. I have read all of Scott Cane's book. It has great things in it and I have read them all. I have got one here, it is Volume 2. There are two other volumes. The parties have put forward a summary of Scott Cane's book and they have agreed that the facts in the summary are true facts. 8 I have read an affidavit by Mr Gavin Dunn for the State of Western Australia. The State has made its own assessment and has had its own experts look at this. Professor Basil Sansom has looked at this. 9 I am very satisfied that the agreement should receive the approval of the Court. 10 But before I sign the Court's orders, I want to say this. The expedition with which the State undertook this process and the care with which the applicants have put their case is very commendable and it is very good that this case started and finished within less than a year. It is also good that it has happened this way, because a lot of people have had goodwill and have come together to make the agreement; and that is a very good thing. 11 Also, of course, it is relevant that I take into account that the parties have acted freely, with goodwill and with expert advice from the lawyers and anthropologists. The claimants have been very careful to put their case properly and the State of Western Australia has considered it very well. 12 Now, I am going to make the orders in the terms agreed, but before I do so, I want to say something more as a law person. I have said this before in the Western Desert but I want to say it again today near Nyili. 13 In making these orders, the Court does not give you native title. No. The Court determines that native title exists. The Court determines that this is your land. That it [the title] is based upon your traditional laws and customs which have always been; and that means that the law says to all the people of Australia that this is your land and it always has been your land because your laws and customs have said, and say today, that it is your land. What the Court does is to say to everyone in Australia that this is your native title. 14 So that is all I want to say ladies and gentlemen. The Court agrees with the agreement that the parties have reached and I am now going to sign the determination of native title. It is a long document so I will not read it out, but the most important parts say that the Court declares and determines that native title exists in the determination area, and that it is held by the people who are the claimants, and that in respect of most of the interests, the title is for the use and occupation and enjoyment of the land to the exclusion of everyone else. That means that it is your land. 15 I will now sign the orders. I've got this through by old people. I live - because of old people taught me which our land is and I've been waiting and talking for the last 20 years or more and now I got it here for people and for all our young people to come, in years to years to come, generation to generation. Yeway. When you generation take over, when you new generation take over, we want to see - you got to live in one big happy family. Not fighting or starting war in this country, we want peace. We want to see people live in peace. Thank you. THE CHIEF JUSTICE: Ladies and gentlemen, that is the end of the court hearing. Close the Court, please, Mr Sheppard. | consent determination court's discretion making orders under s 87 relevant factors for the court to take into account when determining whether the court is satisfied it is appropriate to make orders sought native title |
The decisions were identical and in respect of two related matters (BRG 649/2008 and BRG 742/2008) involving the same applicant and respondent, and which matters were heard together. In the relevant decisions the Federal Magistrate refused applications made by the applicant (to which the respondent consented) to vacate prior orders of the Federal Magistrates Court and adjourn the substantive trial in the relevant proceedings, which trial was scheduled to commence yesterday. After dismissing the applications to vacate and adjourn, the Federal Magistrate subsequently ordered that the trial commence tomorrow. The applicant has filed a draft notice of appeal with the application for leave to appeal, which cite the following grounds of appeal: The learned Federal Magistrate erred in law by not according natural justice to the Applicant. In refusing the application made by the Applicant to vacate prior orders and adjourn the trial, the learned Federal Magistrate erred as a matter of law by failing to take into account: that the Court had been appraised of the parties' non-compliance with the pre-trial directions orders on or by 4 August 2009; the severe and prejudicial consequences of the refusal for the Applicant and for the Respondent; the effect of the refusal on the likely length and cost of the trial. In the draft Notices of Appeal the applicant has sought the following orders: That the decision to refuse the application be set aside. That the orders sought in the application filed in the Federal Magistrates Court on 18 August 2009 be made. That the decision to refuse the stay the trial pending the outcome of this appeal be set aside. That the costs of this appeal be costs in the Federal Magistrates Court proceeding BRG649/08. Such further or other orders as the court sees fit. I note that the application to which reference is made in draft Order 2 in the draft Notice of Appeal was actually filed 19 August 2009. That application sought the following orders: That the Orders made by this Court on 30 April 2009 be vacated. Orders as per the attached draft order. In the "attached draft order" the parties sought orders as to disclosure and evidence, and pre-trial orders. The respondent in these proceedings supports the application before me. The following relevant facts are common ground: The substantive proceedings in both applications before the Federal Magistrates Court involve alleged breaches of the Workplace Relations Act 1996 (Cth) by the respondent, who was previously the employer of the applicant. In summary those allegations include breach of freedom of association provisions and breach of a collective agreement. Provisions of the legislation allegedly breached include civil penalty provisions. On 30 April 2009 the Federal Magistrate made orders in relation to this matter including with respect to discovery, evidence and trial directions. The hearing was scheduled for 24 August 2009. The parties failed to comply with orders 2-7 made 30 April 2009 by the Federal Magistrate. The reason for this failure was that the parties were in settlement negotiations for some time, and wished to minimise costs in anticipation of settlement. The negotiations were eventually unsuccessful. On 4 August 2009 Mr Green telephoned the associate to the Federal Magistrate and explained the reasons for non-compliance with his Honour's directions by both parties. He foreshadowed the applicant's intention to apply to vacate his Honour's orders of 30 April 2009 and seek new orders for conduct of the trial. Mr Green again was telephoned by Federal Magistrate's associate on 13 August 2009 and informed her that the applicant still intended to apply to vacate his Honour's orders, and apply for new orders. Mr Green also informed the associate that the solicitors for the respondent were seeking instructions from their client about whether to consent to the applicant's proposed application, and that the reason that the application to vacate his Honour's orders had not been filed was because, if possible, the applicant preferred to seek orders to which both parties had indicated consent. On 19 August 2009 the applicant filed two identical applications and supporting affidavits (one in respect of each matter before the Court) seeking vacation of the trial date, and certain orders leading up to trial. These orders had been negotiated between the parties. The supporting affidavits explained the reason for non-compliance due to the settlement negotiations, and that accordingly the parties were not ready for trial on 24 August 2009. On 20 August 2009 Mr Green attempted to contact the associate to the Federal Magistrate, and left a voicemail message referring to the applications filed 19 August 2009, and stating that further correspondence signed by both parties indicating consent to the orders sought in the application was to be faxed to the Federal Magistrates chambers. Later that day the relevant correspondence was faxed. On 21 August 2009 Mr Green again attempted to contact the associate to his Honour by telephone. Mr Green then sent an email to the associate enclosing a copy of affidavits in support of the application to vacate and seek new orders. On 21 August 2009 Mr Farr rang Jarrett FM's associate to follow up on the status of the proposed consent orders and whether the orders could be made "on the papers". The telephone call was put directly through to her voicemail and Mr Farr left a message to that effect and asked that the associate call him. The matter returned before his Honour yesterday, which was listed as the first day of the trial. Both parties submitted before me that this was the first opportunity the parties had had to appear before his Honour in relation to the applications to vacate previous orders and seek new orders. The transcript of the hearing is not available for me to view, however Mr Green deposed in his affidavits of 25 August 2009 para 33 as to what had occurred at the hearing. In summary: In his affidavit Mr Farr, who had attended the hearing before his Honour on behalf of the respondent, deposed that he agreed and adopted as his own para 33 of Mr Green's affidavit as an accurate recollection of the hearing of the applications before his Honour on 24 August 2009 (affidavit of Andrew Farr filed 25 August 2009 para 8). Neither party had an opportunity to put submissions to the Court in respect of the applications. It is not in dispute in this case that decision to refuse to adjourn a hearing is an interlocutory decision ( Aon v Australian National University [2009] HCA 27 at [150] ). Principles applicable to the issue of leave to appeal in this jurisdiction are well-settled. The key questions in determining such an application are whether the judgment was attended by sufficient doubt to warrant it being reconsidered, and whether substantial injustice would result if leave were refused: Décor Corporation Pty Ltd v Dart Industries (1991) 33 FCR 399 , Telstra Corporation Ltd v AAPT Ltd (1997) 38 IPR 539. In this case I am satisfied that leave to appeal from the decisions of his Honour should be granted. In my view his Honour's decisions are attended by sufficient doubt to warrant them being reconsidered, for the following reasons: The decision of his Honour to refuse to adjourn the trial was made without hearing submissions from the parties in support of the adjournment. While case management issues in the Court are of clear importance in managing the Court's workload, it is contrary to natural justice to make such an order without hearing the submissions of the parties in relation to the order. Neither applicant nor respondent are ready for trial. In my view the explanation for the delay in compliance with previous orders is reasonable --- namely that the parties were in lengthy settlement negotiations which have only recently proved unsuccessful. It is clear that the applicant had endeavoured to communicate with his Honour's chambers several days before the hearing and inform his Honour of the intention to file applications to vacate the proceedings, and that such applications were indeed filed several days before the substantive trial was listed to commence. While the applications were made late in the litigation --- only several days before the hearing --- in my view the conduct of the parties is not such that their wishes for the matter to be adjourned should be disregarded without allowing them to be heard. The application to adjourn the hearing was with the consent of both parties. This was a significant matter which his Honour should have --- but clearly did not --- take into account. I consider that the principles recently articulated in Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27 are inapplicable in this case. In Aon the plaintiff sought an adjournment of a hearing three days into a four week trial in order to make significant amendments to its statement of claim. The judge at first instance granted the adjournment and gave leave to amend, a decision affirmed by the ACT Court of Appeal. The High Court allowed the appeal, on grounds including that the proposed amendments to the statement of claim did not fall into the category of amendments contemplated by the Court Procedure Rules 2006 (ACT) (namely amendments required to be made for the purposes of deciding the real issues in the proceeding, or for the purpose of avoiding multiple proceedings) the significant prejudice to the defendant, and the deleterious effects on other litigants whose trial dates would require postponement. In the proceedings before his Honour however none of these issues arise. The reason for the adjournment is not to permit an amendment to the pleadings after commencement of the trial, both parties support the adjournment, and the inconvenience to the Court is not clear (indeed even if the appeal were to be allowed and the matter returned to the Federal Magistrates Court for relisting, the reality is that the parties would need to fit into the Court's busy listing timetable, not the other way around). Further, I am of the view that substantial injustice would result if leave to appeal were refused because : The litigation in these proceedings has scarcely progressed beyond pleadings. Discovery has not been completed. As Mr O'Grady for the respondent submitted, for example, in the substantive proceedings there is a live issue as to whether the applicant is medically fit to be reinstated in the employment of the respondent, and relevant to this issue are medical reports which have not yet been discovered. No affidavits have been prepared for witnesses in these proceedings to date for reasons I have already set out related to attempted settlement of the matter. In the absence of the opportunity to file affidavit evidence, it is likely that the applicant will call up to twelve witnesses, and the respondents at least five witnesses. The matter is listed to be heard before his Honour for three days. Practically it is unlikely that a hearing involving obtaining evidence-in-chief from seventeen witnesses, and cross-examining those witnesses, would be completed within three days. Such a result would prolong the hearing and increase the costs of the parties. The proceedings involve the possible imposition of civil penalties. The seriousness of this result militates against a hearing in which the parties lack adequate opportunity for preparation. The orders were made by his Honour without allowing the parties an opportunity to be heard. As I observed earlier, in my view this is a denial of natural justice. I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Collier. | s24(1)(a) of the federal court of australia act 1976 (cth) application for leave to appeal from interlocutory decision of federal magistrate late application to adjourn trial and vacate previous orders refused non-compliance by both parties with pre-trial orders advanced settlement negotiations of parties failed parties not ready for trial proceedings at an early stage discovery not yet undertaken respondent supports application whether judgment attended by sufficient doubt to warrant being reconsidered whether substantial injustice would result if leave refused parties not given an opportunity to make submissions possibility for the imposition of civil penalties medical fitness of applicant a live issue requiring medical reports numerous witnesses no affidavits prepared denial of natural justice practice and procedure |
The claim, as formulated in an amended application which was subsequently filed in the proceedings, is brought pursuant to s 39B of the Judiciary Act 1903 (Cth) ('the Judiciary Act ') and is brought to restrain the commission of a tort and the abuse of statutory authority by the respondents in relation to the detention and removal of the applicant from Australia pursuant to s 198 of the Migration Act 1958 (Cth) ('the Migration Act '). 3 The applicant sought interlocutory relief in the proceedings and on 18 January 2006 Mansfield J made an order that the second respondent be restrained from removing the applicant from Australia until further order. He gave the second respondent liberty to apply to vary or discharge the order on reasonable notice. 4 On 28 March 2006 the applicant filed and served a third amended statement of claim and on 21 April 2006 the respondents filed and served an amended defence to that statement of claim. When I refer to the pleadings in these reasons, I will be referring to those documents. 5 On 12 May 2006 the second respondent issued a notice of motion supported by an affidavit seeking a number of orders. That is the first application which is before me. That paragraphs 21, 22, 23 and 24 of the third amended statement of claim dated 28 March 2006 be struck out as disclosing no cause of action. 2. That the interlocutory injunction granted herein on 18 January 2006 be discharged. The decision or decisions challenged by the third amended statement of claim dated 28 March 2006 (the SOC) is a/are private clause decision(s) within the meaning of s 474 (and in particular subsection 474(3)) of the Migration Act 1958 . By paragraphs 21, 22, 23 and 24 of the SOC, the applicant purports to challenge, review, quash, and/or subject to injunction the said private clause decision(s). By virtue of section 476A of the Migration Act 1958 , this Honourable Court does not have original jurisdiction to entertain a challenge to the privative clause decision(s). In the absence of original jurisdiction over part of the within proceedings, this Honourable Court has no accrued jurisdiction to entertain the remainder of the matters raised in the SOC. This Order applies to the making of an application in relation to a migration decision (within the meaning of the Migration Act 1958 ) in relation to which the Court has original jurisdiction under paragraph 476A(1) (a), (b) or (c) of that Act. If a respondent to an application under this Order objects to the competency of the application, the respondent must, within 14 days after service upon him of the application, file and serve on the other parties to the proceeding a notice of objection stating briefly the grounds of the objection. In applying Order 20, rule 2 to applications to which this Order applies, that rule is to be construed as if paragraph (1)(a) read "no reasonable basis for the application is disclosed". At all events, the notice was not issued within the time prescribed and the second application before me is an application for an extension of time within which to file and serve the notice of objection to competency and, if appropriate, the determinations of the issues raised by the notice. 10 On 2 January 2002 the applicant arrived in Australia as the holder of a subclass 676 Tourist visa. He is a citizen of Turkey. 11 On 14 February 2002 the applicant applied for a subclass 866 Protection visa. He was granted a subclass 010 Bridging A visa. On 11 April 2002 the applicant's application for a protection visa was refused by a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs. On 18 April 2002 the applicant applied to the Refugee Review Tribunal ('the Tribunal') for a review of the delegate's decision. On 20 June 2003 the Tribunal affirmed the delegate's decision. The applicant's Bridging Visa A expired on 18 July 2003 and the applicant then became an unlawful non-citizen within the meaning of the Migration Act . On 14 September 2004 the applicant voluntarily approached the Department of Immigration and Multicultural and Indigenous Affairs and he was detained on that date and accommodated at the Villawood Immigration Detention Facility. 12 On 8 October 2004 the applicant sought judicial review of the Tribunal's decision by the Federal Magistrates Court. That Court dismissed the application on 16 February 2005. On 18 November 2004 the applicant was transferred to the Baxter Immigration Detention Facility. On 22 November 2004 the applicant applied for a subclass 050 Bridging (General) visa (Bridging Visa E) but this application was refused by a delegate of the Minister. 13 On 9 March 2005 the applicant appealed to the Full Court of this Court against the decision of the Federal Magistrates Court. That appeal was dismissed on 16 May 2005. On 8 August 2005 the applicant sought ministerial intervention pursuant to ss 417 and 48B of the Migration Act . On 19 December 2005 the Minister decided not to intervene. On 16 or 17 January 2006 the applicant was informed by officers of the second respondent that he would be removed from Australia to Turkey on 19 January 2006. 14 It is common ground that the applicant suffers from a mental illness. 16 There are two claims made by the applicant: one is a claim in tort for a breach of a duty of care, and the other is a claim that the proposed removal of the applicant from Australia is beyond power and would be ultra vires and unlawful. Although the allegations in the statement of claim relating to the allegation that the act of removing the applicant from Australia would be beyond power refer on occasion to the 'respondents', it is clear that the act of removing the applicant from Australia would be carried out by the second respondent, the Commonwealth of Australia. 17 I deal first with the allegation that the proposed removal of the applicant from Australia is beyond power and would be ultra vires and unlawful. The applicant alleges that the second respondent has no power to remove the applicant pursuant to s 198 of the Migration Act because his proposed removal is not reasonably practicable within the meaning of the said section (paragraph 21). By way of particulars of the alleged lack of power, the applicant alleges that the respondents propose to remove the applicant in a manner that is unreasonable by removing him from Australia when to do so will expose him to the likely risk of serious harm and by removing him from Australia while he is unfit to travel (paragraph 22). The applicant alleges that in the premises the removal of the applicant would be ultra vires and unlawful (paragraph 23). That the first respondent owed him a duty of care to take all reasonable steps to ensure that the conditions at Baxter did not cause or contribute to his mental illness and to ensure that he received adequate medical treatment (paragraph 16) and that the first respondent acted in breach of that duty. Various particulars of breach of duty are alleged but it is not necessary to set out those particulars (paragraph 16a). 2. That the second respondent owed the applicant the same duty as is referred to in 1. because it is a non-delegable duty (paragraph 16c), or because the second respondent is vicariously liable for the first respondent's breach of duty (paragraph 16b). 3. That the second respondent owes the applicant a duty of care, both in the exercise of its power to detain him and in the exercise of its power to remove him from Australia, to take all reasonable steps to ensure that he is not thereby exposed to the risk of serious harm (paragraph 17). As to that aspect of the duty which relates to the exercise of the power to remove the applicant, the applicant alleges that the second respondent exposes the applicant to a 'likely risk of serious harm' by proceeding with its intention to remove him from Australia when such removal would cause serious risk to his health and by planning to remove him from Australia while he is unfit to travel (paragraph 18(b) and (c)). The claim for an order that the interlocutory injunction be discharged (paragraph 3) is said to follow from the making of the first two orders. The test I must apply is well known and it is a demanding one. I should only make the orders sought if I am satisfied that the claim for relief and the allegations which are the subject of challenge cannot possibly succeed. General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69 ; (1964) 112 CLR 125 per Barwick CJ at 129; Dey v Victorian Railways Commissioners [1949] HCA 1 ; (1949) 78 CLR 62 per Dixon J at 91. It is to be assumed that, insofar as it is said that the paragraphs in the statement of claim to which I have referred do not disclose a reasonable cause of action, the allegations of fact made by the applicant can be made out. 22 The applicant submits that his removal from Australia is not a privative clause decision because it is not a 'decision' under the Migration Act and therefore it does not fall within s 474. The applicant submits that whether it is 'reasonably practicable' to remove an unlawful non-citizen is a jurisdictional fact and it is ultimately for the Court to decide if the fact is made out. 23 The respondents submit that the relevant allegations in the statement of claim (ie, paragraphs 21, 22 and 23) do not support a conclusion that the removal of the applicant from Australia would constitute a failure to exercise jurisdiction or an excess of jurisdiction within the principles enunciated by the High Court in Plaintiff S157/2002 v Commonwealth [2003] HCA 2 ; (2003) 211 CLR 476. In other words, it is submitted by the respondents that the allegations in the statement of claim do not support the only challenge which may be made to a privative clause decision, namely, a challenge on the ground of jurisdictional error. Accordingly, the proposed removal of the applicant cannot be challenged. 24 The applicant submits that even if the removal of the applicant from Australia is a privative clause decision within s 474 it can be challenged on the ground of error of jurisdictional fact. 25 The respondents submit that if its first two submissions are correct, namely, that the decision to remove the applicant from Australia is a privative clause decision and as the allegations presently stand cannot be challenged, then the only possible federal claim is doomed to fail. The other claims in the proceedings are claims in tort which are not within the jurisdiction of this Court. The respondents submit that there is no room for the operation of the doctrines of associated or accrued jurisdiction. 26 The respondents further submit that even if its earlier submissions fail, this Court does not have jurisdiction to entertain claims for relief in relation to the applicant's proposed removal from Australia because of the provisions of s 476A of the Migration Act . 27 The applicant submits that even if his proposed removal from Australia falls within the terms of s 476A , this Court nevertheless has jurisdiction to consider his challenge to that proposed act by reason of the Court's accrued jurisdiction. The applicant points to the fact that he seeks an injunction against an officer of the Commonwealth (ie, the first injunction sought against the first respondent) and that that is within the jurisdiction conferred on this Court by s 39B of the Judiciary Act . It is submitted by the applicant that in the circumstances the claim in tort against the second respondent, and the challenge to the proposed removal of the applicant, are part of this Court's accrued jurisdiction. 28 I turn now to deal with the issues raised by these contentions. The officer will be required to make a judgment as to when is 'as soon as reasonably practicable' and it might be thought as a matter of ordinary language, a decision as to that matter. An officer has a duty to remove an unlawful non-citizen once that person falls within the terms of (a)-(d) inclusive and the only possible decision he or she is then required to make is when such removal is 'as soon as reasonably practicable'. I will not set out the definition of officer in s 5 of the Act. The definition includes a wide category of persons. 32 The Court noted that s 198(6) imposes a duty, but it is a duty which only arises upon the occurrence of certain events or the satisfaction of certain conditions. The matters in paragraphs (a)-(d) inclusive must occur or arise before the duty arises. Furthermore, the duty is not absolute in the sense that thereafter it only arises as soon as it is reasonably practicable to remove the unlawful non-citizen. The Court noted that in Minister for Immigration and Multicultural and Indigenous Affairs v Al Masri [2003] FCAFC 70 ; (2003) 126 FCR 54 the Full Court of this Court said that there was no duty to remove an unlawful non-citizen when removal was not reasonably practicable. The Court in M38/2002 considered the meaning of the words 'reasonably practicable' and noted various dictionary definitions and statements made in the authorities. The Court expressed the view that whether the removal of an unlawful non-citizen is practicable 'seems to be largely, if not entirely, concerned with whether the removal is possible from the officer's viewpoint' (at 165[65]). The Court expressed the view that the removal of a non-citizen may be practicable in the sense of feasible, but not 'reasonably practicable' as required by s 198(6) of the Act. The Court expressed the view that practicability and reasonableness may, on occasions, operate in opposing senses. The Court identified as matters an officer may taken into account in determining whether it is reasonably practicable to remove an unlawful non-citizen matters such as whether another country will admit the person, whether it can admit the person and the physical condition of a person facing removal (at 166[69]). There is no reason not to include in this list of matters, the mental condition of a person facing removal. 33 In M38/2002 the Court said that in determining when it was reasonably practicable to remove an unlawful non-citizen it is not open to an officer to consider whether an unlawful non-citizen is a 'refugee' within the meaning of Art 1A(2) of the Refugees Convention as amended by the Refugees Protocol ('the Convention'): s 5 of the Migration Act . Nor is it open to an officer to consider whether the unlawful non-citizen's removal and return to a particular country is conformable with the obligation against refoulment is Art 33(1) of the Convention. 34 In the context of considering the Court's supervisory jurisdiction, the Court addressed the question of whether removing or refusing to remove an unlawful non-citizen under s 198(6) was a privative clause decision within s 474 of the Migration Act . Section 474(3)(g) provides that a reference in s 474 to a "decision" includes a reference to "doing or refusing to do any ... act or thing". Removing or refusing to remove an unlawful non-citizen under s 198(6) is, by virtue of s 474(3)(g), a "decision" and, as such, a "privative clause decision" within the meaning of s 474(2). They represent considered remarks of the Full Court and, moreover, in my respectful opinion they are correct. A 'decision' includes doing an act or thing (s 474(3)(g)) and a 'privative clause decision' includes a proposed decision ( WAJZ v Minister for Immigration and Multicultural and Indigenous Affairs (No 2) (2004) 84 ALD 655 per French J at [70] (' WAJZ '). 36 Some of the issues considered by the Full Court in M38/2002 were considered again by the Full Court in the subsequent decision in NATB v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 292 ; (2003) 133 FCR 506 (' NATB '). The Court qualified the statement of the Full Court in M38/2002 that in the context of the Act, practicability and reasonableness may, on occasion, operate in opposing senses. The Court said that an element of reasonableness was inherent in practicability and the use of the word 'reasonably' may operate to extend the reasonableness notion, 'further along what may be described as "the continuum of reasonableness"' (at 516 [50]). The Court said that it would not attempt a definition of all the circumstances relevant to the concept of what was 'reasonably practicable'. It was impossible to foresee all the circumstances which may arise and the question involved a process of evaluation of the facts of each case. The Court said that physical considerations such as the health of the person to be removed and the availability of an operating airport in the place of destination were not the only relevant considerations. The willingness of a country to allow a person to enter its territory is at least one non-physical factor relevant to reasonable practicability. On the other hand, the limits on the matters relevant to reasonable practicability arise from the words themselves and the relevant considerations are practical considerations in the context of the proposed physical removal of a person from Australia. 37 Subject to the one qualification which I have mentioned, nothing was said by the Full Court in NATB to suggest that the Court's observations and conclusions in M38/2002 were wrong and in particular the conclusion that to remove or to refuse to remove was a privative clause decision. 38 The applicant referred to the decision of the High Court in Al-Kateb v Godwin [2004] HCA 37 ; (2004) 219 CLR 562 (' Al-Kateb ') a case I will need to refer to again in another context. There is nothing in that case that suggests that the decisions in M38/2002 and NATB are not correct. 39 In my opinion, the proposed removal of the applicant from Australia pursuant to s 198(6) of the Migration Act is a privative clause decision within s 474 of the Act. If it is not a jurisdictional fact, can the proposed removal of the applicant be set aside on the ground of jurisdictional error (other than jurisdictional fact) and, if so, are the allegations in the statement of claim sufficient to raise an arguable case of such a jurisdictional error. 41 In my opinion, the question of reasonable practicability is not a jurisdictional fact. The question is whether 'reasonable practicability' is to be finally determined by the officer or only provisionally determined by him or her and finally determined by the Court. As I understand the authorities, that question is ultimately one of statutory consideration. If the factual reference (as it is sometimes called) is expressed in terms of the 'opinion', 'belief' or satisfaction' of the primary decision-maker then the factual reference is not a jurisdictional fact, although there will still be a jurisdictional fact, namely, the primary decision-maker's state of mind. The contrary does not follow, in that the absence of reference to 'opinion', 'belief' or 'satisfaction' of the decision-maker does not mean the factual reference is a jurisdictional fact (Aronson, Dyer and Groves, Judicial Review of Administrative Action (3 rd ed, 2000) pages 227-239). 2. The nature of the task is important. If the task is a difficult and complex one involving an assessment of complex facts and the forming of opinions on a wide range of matters then that suggests that the factual reference is not a jurisdictional fact because it is considered that Parliament intended that the decision be made by the primary decision-maker: Australian Heritage Commission v Mount Isa Mines Ltd (1995) 60 FCR 456 per Black CJ at 465-466 (High Court: Australian Heritage Commission v Mount Isa Mines Ltd [1997] HCA 10 ; (1997) 187 CLR 297); Cabal v Attorney-General of the Commonwealth [2001] FCA 583 ; (2001) 113 FCR 154. 3. If inconvenience results from holding that a factual reference is a jurisdictional fact then that will be considered a reason not to hold that it is a jurisdictional fact: Parisienne Basket Shoes Pty Ltd v Whyte [1938] HCA 7 ; (1938) 59 CLR 369; Australian Heritage Commission v Mount Isa Mines Ltd (1995) 60 FCR 456 per Black CJ at 465-466; Cabal v Attorney-General of the Commonwealth (supra) per Weinberg J at 173 [74]. But, if the legislature does make the jurisdiction of a court contingent upon the actual existence of a state of facts, as distinguished from the court's opinion or determination that the facts do exist, then the validity of the proceedings and orders must always remain an outstanding question until some other court or tribunal, possessing power to determine that question, decides that the requisite state of facts in truth existed and the proceedings of the court were valid. Conceding the abstract possibility of the legislature adopting such a course, nevertheless it produces so inconvenient a result that no enactment dealing with proceedings in any of the ordinary courts of justice should receive such an interpretation unless the intention is clearly expressed. The importance of the decision in terms of the nature of the rights affected by it is a matter to be taken into account. If the rights at stake are fundamental or important rights then that may suggest that the factual reference is a jurisdictional fact: Buck v Comcare (1996) 66 FCR 359 per Finn J at 364. It is true that two of the factors suggest that it should be characterised as a jurisdictional fact, but the other two factors speak so strongly against it being a jurisdictional fact that the first two factors are clearly outweighed. Weighing in favour of the factual reference being a jurisdictional fact is that there is no reference to the officer's 'opinion', 'belief' or 'satisfaction' in s 198(6) of the Act, although (as Gummow J noted in Al-Kateb at 608 [121]) the use of the word 'reasonably' suggests that there is an element of judgment or assessment in the criterion. Also weighing in favour of the factual reference being a jurisdictional fact is that important interests of the unlawful non-citizen are at stake, although it must be remembered that those interests are at most concerned with the applicant's detention prior to his eventual deportation and the timing of that deportation, rather than any actual right to remain in Australia. On the other hand, the nature of the task may be a difficult and complex one and may involve a wide range of considerations; indeed, it may be impossible to come to any conclusion without a detailed consideration of a great deal of information, much of it of a political or diplomatic character. Whilst a Court may have little difficulty determining the unlawful non-citizen's fitness to travel it would be ill-equipped to consider other matters such as conditions in other countries. Furthermore, circumstances may change very quickly and require constant monitoring. A decision that the factual reference is a jurisdictional fact would produce considerable inconvenience because it would mean that an officer's decision that removal was reasonably practicable would be provisional until upheld by a Court in a context where circumstances may change very quickly. 43 The applicant referred to the decision of Al-Kateb in this context, but in my opinion there is nothing in that case which suggests that the question of reasonable practicability is a jurisdictional fact. It is true that certain Justices of the High Court considered what was encompassed by the phrase 'reasonable practicability'; Gummow J at 608 [121]; Hayne J at 639 [227]; Callinan J at 658-662 [290]-[299] but the Court did not address the question of whether reasonable practicability was a jurisdictional fact. Although his Honour was concerned with different questions to those arising before me, in my respectful opinion the High Court's treatment of the phrase was accurately summarised by French J in WAJZ at [83]-[85]. 44 Although the question of reasonable practicability is not a jurisdictional fact, the proposed removal of the applicant from Australia can be challenged on the other grounds which constitute jurisdictional error: WAJZ per French J (at [70]). I do not think that there can be any doubt that a circumstance relevant to the question of reasonable practicability is the applicant's physical and mental condition. The difficulty for the applicant is that a jurisdictional error of the relevant type is not pleaded in paragraphs 21, 22 and 23 of the statement of claim. Those paragraphs proceed on the assumption that it is sufficient to allege that as a matter of fact it is not reasonably practicable to remove the applicant from Australia. For the reasons I have given, that is not sufficient. 45 It is convenient if I state my conclusions to this point. Paragraphs 21, 22 and 23 must be struck out because the removal of the applicant from Australia is a privative clause decision and the paragraphs do not disclose an arguable case of jurisdictional error of the relevant type. It seems to me that it follows from the terms of s 474 that the removal of the applicant from Australia is not to be the subject of an injunction whether the claim is based on the allegation that removal is beyond power or on an alleged breach of a duty of care. It follows that the claim for an injunction based on an anticipated breach of a duty of care (paragraph 20(e)) cannot succeed. It must also follow that the somewhat novel claim (as far as I can see) in paragraph 24 cannot succeed. Furthermore, the claim for relief involving an injunction restraining the second respondent from removing the applicant from Australia (the second injunction) cannot succeed and the interlocutory injunction must be discharged. 46 However, my conclusions to this point would not mean that the whole of the applicant's claim should be struck out. The claim against the first respondent for an injunction in relation to the detention of the applicant would appear to be within the jurisdiction of the Court ( Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Mastipour (2004) 206 ALR 83; s 39B(1) Judiciary Act ) and the claim against the second respondent for damages for breach of a duty of care in relation to the detention of the applicant is arguably within the associated or accrued jurisdiction of the Court. Furthermore, it was not suggested that either of those claims are not arguable. More difficult questions arise in relation to the alleged claim for damages in tort against the second respondent in relation to the proposed removal of the applicant from Australia in light of the terms of s 474(1) of the Migration Act . 47 In addition to those matters, had it not been for the provisions of s 476A of the Migration Act my conclusions to this point would have given rise to a question as to whether the applicant should be given leave to re-plead the allegations in paragraphs 21, 22 and 23 to raise (if he is able to) an arguable case of jurisdictional error of the relevant type. 49 Substantial amendments were made to Part 8 of the Migration Act by the Migration Litigation Reform Act 2005 (Cth) and the amendments introduced by that Act came into force on 1 December 2005. By reason of s 476A it now has jurisdiction in relation to migration decisions 'if, and only if' the decision falls within one of the paragraphs in s 476A(1). It is not suggested by the applicant that the decision to remove him from Australia falls within any of those paragraphs, and, therefore, this Court does not have jurisdiction in relation to the proposed removal of the applicant from Australia because it is a privative clause decision as the pleadings presently stand or, even if the applicant is able to plead an arguable case of jurisdictional error of the relevant type, a purported privative clause decision. In my opinion, this means that not only does this Court not have original jurisdiction to determine a claim that his removal would be beyond power or ultra vires, but also it does not have original jurisdiction to grant an injunction on the alternative basis of restraining the commission of a tort. 52 The original jurisdiction previously exercised by this Court in relation to migration decisions is, subject to certain exceptions, now vested in the Federal Magistrates Court. The matters removed from the jurisdiction of this Court are described by reference to subject matter and the nexus with the subject matter removed from the jurisdiction of the Court is identified by words of wide import, namely, 'in relation to' although I recognise that the precise nexus identified by those words will be determined by the provisions of the Act in which they appear: PMT Partners Pty Ltd (In Liq) v Australian National Parks and Wildlife Service [1995] HCA 36 ; (1995) 184 CLR 301 per Toohey and Gummow JJ at 331-332. I do not think this Court has original jurisdiction to grant an injunction restraining the second respondent from removing the applicant from Australia. 53 The applicant sought to overcome the difficulties posed by s 476A by submitting that this Court has jurisdiction over his claim insofar as it involves a claim for an injunction against the first respondent who is alleged to be an officer of the Commonwealth (ie, the first injunction seeking to restrain a breach of a duty of care in tort) in relation to the detention of the applicant, and that the claim in tort against the Commonwealth in relation to both the detention and removal of the applicant and the claim that the removal of the applicant was beyond power and ultra vires are part of the accrued jurisdiction of the Court. The applicant submitted that s 476A is directed to the original jurisdiction of the Court and not the accrued jurisdiction of the Court. 54 In this case the submission that this Court has accrued jurisdiction is a novel one because the claim said to fall within the accrued jurisdiction is in fact a federal claim. By reason of an express statutory provision it is within the jurisdiction of the Federal Magistrates Court and not this Court. This exposes the fallacy of the applicant's argument. I do not think there can be accrued jurisdiction over a federal claim removed from the original jurisdiction of this Court and entrusted to the Federal Magistrates Court. Part of the applicant's claim is within the jurisdiction of this Court, namely, the claim for an injunction against the first respondent and I did not understand the respondents to argue that this claim was not arguable. The claims in tort for damages against the Commonwealth of Australia may be within the associated or accrued jurisdiction of the court and if necessary I will hear further from the parties on this question. 56 It is appropriate to make orders on the second respondent's notice of motion. I will make the order sought in paragraph 1 of the notice of motion. Furthermore, it seems to me that it is also appropriate to make the orders sought in paragraphs 2 and 3, but because there was some uncertainty in the respondents' submissions as to whether I should make the order sought in paragraph 2, I will hear further from the parties (if they seek to be heard) as to the orders sought in paragraphs 2 and 3 of the notice of motion. 57 I will also hear the parties as to any other orders. | unlawful non-citizens detention pending removal from australia where applicant alleges it is not reasonably practicable to remove objection to jurisdiction whether removal from australia a privative clause decision within the meaning of migration act 1958 (cth) whether migration act 1958 (cth) s 476a prevents federal court from entertaining claim for relief founded on jurisdictional error or tort where concurrent claim in tort against officer of the commonwealth within the meaning of s 39b of the judiciary act 1903 (cth) whether s 476a of the migration act 1958 (cth) overcome by federal court's accrued jurisdiction. whether 'reasonable practicability' of removal a jurisdictional fact factors to be considered in assessing whether a factual reference is a jurisdictional fact to be finally determined by a court. immigration administrative law |
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