case_text: The applicants submit the principles in Webster v Lampard [1993] HCA 57 ; (1993) 177 CLR 598 ('Webster') apply to this application. The applicants rely upon the following observations of Mason CJ and Deane and Dawson JJ in Webster at 602: '...the issue before the learned Master on the application for summary judgment was not whether [the plaintiffs] would probably succeed in their action against [the defendant] . It was whether the material before the Master demonstrated that the action should not be permitted to go trial in the ordinary way because it was apparent that it must fail.' 9 Their Honours continued at 602: 'The power to order summary judgment must be exercised with "exceptional caution" ( General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) [1964] HCA 69 ; (1964), 112 C.L.R. 125, at p. 129) and "should never be exercised unless it is clear that there is no real question to be tried" ( Fancourt v. Mercantile Credits Ltd. [1983] HCA 25 ; (1983), 154 C.L.R. 87, at p. 99).' 10 I accept that the observations in Webster , referred to above, apply to the disposition of this application.


case_outcome: cited

case_text: Further, the applicants submit that, in accordance with the principles in the case of Janssen-Gilag Pty Limited v Pfizer Pty Limited (1992) 37 FCR 526 ('Janssen') , it is not necessary for an applicant to show that the misleading and deceptive conduct was made to him or her or that he or she relied on the misleading and deceptive conduct for that applicant to seek relief under the TP Act. It is sufficient if the misleading and deceptive conduct is relied upon by someone other than the applicant, provided that the loss suffered by the applicant was causally linked to that conduct. It was submitted that, in this case, there was arguably a sufficient link between the alleged misleading and deceptive conduct of the fifth respondent and the alleged loss of the funds, to permit the applicants to make the claims based thereon. 12 I now turn to the contents of the witness statements of the applicants. I deal firstly with the father, the first named applicant. He says, at par 9 of his witness statement, that: 'In about mid 1998 John telephoned me and we had a conversation as follows: He said: "I have found a good investment. It is an investment in farming ostriches in Perth. I want to use your name for the investment. It's going to be a surprise for your nephews and nieces." I said: "OK. Have you seen the farm? You should make sure the farm is real." John said: "Yes, I will go to see the farm." ' 13 At par 10 of the witness statement, the first named applicant deposed that: 'Two or three months after that conversation I had a further discussion with John on the telephone during which John said: "I have been to the farm. The farm is very big. There are lots of ostriches in paddocks. There are many paddocks. I met one of the directors of the company. He says this is a very good investment".' 22 I also accept the submissions of the applicants that it is also arguable that this is a case where the principles which are espoused in the Janssen case could be applicable. Thus, even if there were no passing on of the representations to the applicants, it is, at least, arguable that the applicants, as trustees, would be able to recover funds that had been invested as a consequence of the son, as settlor of trust funds, being misled. 23 It follows that I do not accept the submissions of the third respondent that there is no reasonable cause of action disclosed in relation to the applicants' claims for misleading and deceptive conduct, under the TP Act and the Corporations Law. 24 In addition, counsel for the third respondent submitted that there were defects in the claim which was brought under the insolvent trading provisions of the Corporations Law which were so serious that the matter should be summarily dismissed.


case_outcome: followed

case_text: Service of the order of 4 September 2006 was effected personally on Ms Bell. The order so served was endorsed with the notice required by O 37 r 2 of the Federal Court Rules . The order itself was not signed by the registrar, although it bore the stamp of the seal of the Court. The order had been so stamped in consequence of it having been filed electronically, pursuant to O 1 r 5A(1)(e) and O 1 r 5AC of the Federal Court Rules . In accordance with O 1 r 5AC(5)(b), the document served had attached to it a notice of filing bearing a facsimile signature of the registrar. There is a question whether the appearance of the signature of the registrar on that notice, attached to the copy of the order served, is sufficient compliance with the requirement for signature imposed by O 37 r 2. See Siminton v Australian Prudential Regulation Authority [2006] FCAFC 118 (2006) 152 FCR 129 at [64] ; and see O 36 r 7 of the Federal Court Rules . The question need not be answered in the present case, because O 37 r 2(5) clearly applies in the case of the order of 4 September 2006 to both Ms Bell and Living It Up; Ms Bell was aware of the terms of the order, and Living It Up is fixed with her knowledge. In any event, it is clear that, by the time the order of 4 September 2006 was made, Ms Bell had already put it out of her power, and that of Living It Up, to comply with the order, by disposing of the proceeds of sale of the Mariners Place property in the manner I have described. 32 The statement of charges in the notice of motion, pursuant to O 40 r 6 of the Federal Court Rules , reads as follows: '1. The respondents failed to pay into an interest-bearing trust account operated by Kelly & Chapman Solicitors ( the Account ) the proceeds of sale (after deduction of the reasonable costs and expenses of sale) of the property situated at and known as 8 Mariners Place, Noosa Heads, Queensland ( the Property ), having: (a) been ordered to do so by the Court on 10 June 2005; and (b) sold the Property on or before 18 October 2005. 2. The respondents failed to pay into the Account the whole of the proceeds of sale of the Property after deduction of the reasonable costs and expenses of the sale by 15 September 2006, having been: (a) ordered to do so by the Court on 4 September 2006; and (b) served with that order on 11 September 2006.' 45 The power of the English courts to punish for contempt of court at the date of commencement of the Judiciary Act was clearly limited to the power to fine or the power to imprison or, in the case of a corporation, to order sequestration of the assets of the corporation. Rule 11.04.1(a) of the High Court Rules 2004 (Cth) presently provides that, in the case of a natural person, the order may be 'that the contemnor pay a fine, be committed to prison, or both pay a fine and be committed to prison'. In Siminton at [74], the Full Court relied upon r 11.04 of the High Court Rules as removing any doubt as to whether this Court could impose a fine for contempt of court, and as making it clear that both a fine and committal to prison were available penalties. Given that it is possible to include in the one order both a fine and a term of imprisonment, there appears to be no sound reason why the two powers should not be exercised by imposing a fine, with a term of imprisonment in default of payment of the fine, or part of the fine, in order to enforce the payment. In Viner v Australian Building Construction Employees' and Builders Labourers' Federation (No 3) (1982) 63 FLR 242, Keely J made such an order. The order was set aside by the Full Court in Australian Building Construction Employees' and Builders Labourers' Federation v Viner (1982) 63 FLR 253, but not on the ground that it was beyond power. In Australian Industrial Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia & Ors [2001] FCA 774 (2001) 188 ALR 653 at [17] Merkel J suggested that, as a matter of practice in an order fining a contemnor, the Court ought always to make provision for enforcement of that order, in the event that the fine is not paid. His Honour suggested that, in most cases, it would be sufficient for the order to provide that, in default of payment, the district registrar must apply to the Court for directions concerning the enforcement of the order. If that were done, there seems little doubt that the Court would have power to impose a sentence of imprisonment upon the application for directions for enforcement. If that be the case, there seems to be no reason why the Court could not impose a sentence of imprisonment in default of payment of the fine, or part of the fine, in the first place. I am not to be taken as suggesting that the Court ought to do this in every case. There will undoubtedly be many cases in which the Court takes the view that a contempt is insufficiently serious to warrant imprisonment, and that the contemnor's means are such that other enforcement methods will be sufficient to enable the fine to be collected, if it is not paid in accordance with the order. I am satisfied, however, that a sentence of imprisonment in default of payment of a fine, or part of a fine, is a course within the powers of this Court.


case_title: Re Bramblevale Ltd [1970] 1 CH 128

case_text: This view was applied by the English Court of Appeal in Re Bramblevale Ltd [1970] 1 Ch 128. In that case, the managing director of a company had been ordered to produce the company's books to its liquidator. At first instance, he had been found guilty of contempt of court on the basis that he was shown to have had the books in his possession on a particular date, so that it could be presumed that he still had them in his possession more than a year later. The Court of Appeal overturned the finding, holding that the managing director could not be found guilty of contempt of court unless it were proved beyond reasonable doubt that he still had the books in his possession after the order had been made. Bramblevale was cited in Witham v Holloway [1995] HCA 3 ; (1995) 183 CLR 525 at 529 530 per Brennan, Deane, Toohey and Gaudron JJ. In Witham , the question was whether the appropriate standard of proof was beyond reasonable doubt or the balance of probabilities. The case itself did not involve any issue of capacity or ability to obey the order. Nonetheless, no reservation was expressed in the citation of Bramblevale , on the basis that any onus could lie upon the alleged contemnor on any issue. See also Chelvarajah v Global Protection Pty Ltd [2004] FCA 1661 (2004) 142 FCR 296 at [61] [68].


case_title: Witham v Holloway [1995] HCA 3 ; (1995) 183 CLR 525


case_title: Chelvarajah v Global Protection Pty Ltd [2004] FCA 1661 (2004) 142 FCR 296


case_text: This leaves the question of contempt by failing to comply with para 1 of the order of 10 June 2005. It should be noted that the statement of charge in the notice of motion alleges contempt against both respondents, but only in one respect. There is no charge of disposing of, transferring or dealing with the Mariners Place property without first giving notice in writing to the applicant no less than 14 days prior to such dealing. There is no charge of failing to sell the property by public auction. The only charge is failing to pay the proceeds of sale (after deduction of the reasonable costs and expenses of sale) into the trust account kept by Kelly & Chapman. In the absence of a specification in para 1 of the order of 10 June 2005 of the time within which such a payment was required, Ms Bell was obliged to pay the proceeds of the sale into the trust account within a reasonable time of receiving them. See Natural Floor Covering Centre Pty Ltd v Monamy (No 1) [2006] FCA 518 at [13] and [41] [42]. In any event, the time may not be crucial because, at least by June 2006, when Ms Bell returned from her second trip to Tunisia, she had clearly disposed of all of the proceeds of sale otherwise than by paying them into the trust account, and thereby put it out of her power to comply with the order. 38 As I have said, Ms Bell knew of the order of 10 June 2005 throughout the time she was disposing of the proceeds of sale of the Mariners Place property. She conceded that she had the opportunity to consult the terms of the order had she chosen to do so, to ascertain what her obligations were. She chose not to do this. As I have said, this amounted to deliberate blindness on her part about the obligations the Court had imposed on her. There is no doubt that it constituted wilful disobedience of the order of the Court. It is necessary to make a finding that Ms Bell was guilty of contempt of court in relation to the failure to comply with the order of 10 June 2005. 39 The charge against Living It Up is more difficult. Living It Up was not the registered proprietor of any interest in the Mariners Place property. Its relationship to that property was that the property had been used as security for a loan from the Commonwealth Bank that enabled Living It Up to purchase the Resort to Health business. It is clear from the respondents' defence that both Ms Bell and Living It Up were liable to repay the monies borrowed from the Commonwealth Bank for this purpose. In para 47 of the defence, the respondents plead that, in order to complete the purchase of the Resort to Health business by Living It Up, 'the First and Second Respondents borrowed the sum of $240,000 from the CBA'. At the time, according to the pleading, the advance was secured over the assets of the business and the Neerim Road property. Following the sale of the Neerim Road property, according to para 50 of the defence, Ms Bell refinanced liabilities, including that liability, so that they were 'solely the liability of the First Respondent and/or the Second Respondent', and were secured over a cash deposit in the name of Ms Bell. Upon the purchase of the Mariners Place property, according to para 52 of the defence, Ms Bell again refinanced the liabilities, including the money borrowed to purchase the business, so that they were 'solely the liability of the First Respondent and/or the Second Respondent', and secured over the Mariners Place property. It is unlikely that, in the refinancing, Ms Bell would have been able to persuade the Commonwealth Bank to release either her or Living It Up from liability to repay the amount borrowed, in favour of the other. It is therefore clear that, at the time when the Mariners Place property was sold, both respondents were liable to repay the amount borrowed from the Commonwealth Bank and secured on that property.


case_text: The power of the English courts to punish for contempt of court at the date of commencement of the Judiciary Act was clearly limited to the power to fine or the power to imprison or, in the case of a corporation, to order sequestration of the assets of the corporation. Rule 11.04.1(a) of the High Court Rules 2004 (Cth) presently provides that, in the case of a natural person, the order may be 'that the contemnor pay a fine, be committed to prison, or both pay a fine and be committed to prison'. In Siminton at [74], the Full Court relied upon r 11.04 of the High Court Rules as removing any doubt as to whether this Court could impose a fine for contempt of court, and as making it clear that both a fine and committal to prison were available penalties. Given that it is possible to include in the one order both a fine and a term of imprisonment, there appears to be no sound reason why the two powers should not be exercised by imposing a fine, with a term of imprisonment in default of payment of the fine, or part of the fine, in order to enforce the payment. In Viner v Australian Building Construction Employees' and Builders Labourers' Federation (No 3) (1982) 63 FLR 242, Keely J made such an order. The order was set aside by the Full Court in Australian Building Construction Employees' and Builders Labourers' Federation v Viner (1982) 63 FLR 253, but not on the ground that it was beyond power. In Australian Industrial Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia & Ors [2001] FCA 774 (2001) 188 ALR 653 at [17] Merkel J suggested that, as a matter of practice in an order fining a contemnor, the Court ought always to make provision for enforcement of that order, in the event that the fine is not paid. His Honour suggested that, in most cases, it would be sufficient for the order to provide that, in default of payment, the district registrar must apply to the Court for directions concerning the enforcement of the order. If that were done, there seems little doubt that the Court would have power to impose a sentence of imprisonment upon the application for directions for enforcement. If that be the case, there seems to be no reason why the Court could not impose a sentence of imprisonment in default of payment of the fine, or part of the fine, in the first place. I am not to be taken as suggesting that the Court ought to do this in every case. There will undoubtedly be many cases in which the Court takes the view that a contempt is insufficiently serious to warrant imprisonment, and that the contemnor's means are such that other enforcement methods will be sufficient to enable the fine to be collected, if it is not paid in accordance with the order. I am satisfied, however, that a sentence of imprisonment in default of payment of a fine, or part of a fine, is a course within the powers of this Court.


case_text: The power of the English courts to punish for contempt of court at the date of commencement of the Judiciary Act was clearly limited to the power to fine or the power to imprison or, in the case of a corporation, to order sequestration of the assets of the corporation. Rule 11.04.1(a) of the High Court Rules 2004 (Cth) presently provides that, in the case of a natural person, the order may be 'that the contemnor pay a fine, be committed to prison, or both pay a fine and be committed to prison'. In Siminton at [74], the Full Court relied upon r 11.04 of the High Court Rules as removing any doubt as to whether this Court could impose a fine for contempt of court, and as making it clear that both a fine and committal to prison were available penalties. Given that it is possible to include in the one order both a fine and a term of imprisonment, there appears to be no sound reason why the two powers should not be exercised by imposing a fine, with a term of imprisonment in default of payment of the fine, or part of the fine, in order to enforce the payment. In Viner v Australian Building Construction Employees' and Builders Labourers' Federation (No 3) (1982) 63 FLR 242, Keely J made such an order. The order was set aside by the Full Court in Australian Building Construction Employees' and Builders Labourers' Federation v Viner (1982) 63 FLR 253, but not on the ground that it was beyond power. In Australian Industrial Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia & Ors [2001] FCA 774 (2001) 188 ALR 653 at [17] Merkel J suggested that, as a matter of practice in an order fining a contemnor, the Court ought always to make provision for enforcement of that order, in the event that the fine is not paid. His Honour suggested that, in most cases, it would be sufficient for the order to provide that, in default of payment, the district registrar must apply to the Court for directions concerning the enforcement of the order. If that were done, there seems little doubt that the Court would have power to impose a sentence of imprisonment upon the application for directions for enforcement. If that be the case, there seems to be no reason why the Court could not impose a sentence of imprisonment in default of payment of the fine, or part of the fine, in the first place. I am not to be taken as suggesting that the Court ought to do this in every case. There will undoubtedly be many cases in which the Court takes the view that a contempt is insufficiently serious to warrant imprisonment, and that the contemnor's means are such that other enforcement methods will be sufficient to enable the fine to be collected, if it is not paid in accordance with the order. I am satisfied, however, that a sentence of imprisonment in default of payment of a fine, or part of a fine, is a course within the powers of this Court. 64 Although commenced by notice of motion entitled in the principal proceeding, the application for punishment for contempt of court is to be regarded as a separate proceeding in its own right. See Viner v Australian Building Construction Employees' and Builders Labourers' Federation (No 1) (1981) 5 FLR 5 at 27 32 and Australian Building Construction Employees' and Builders Labourers' Federation v Viner (1982) 63 FLR 253 at 266 per Evatt and Deane JJ. Having been found guilty of contempt of court, Ms Bell should be ordered to pay the costs of that proceeding. No occasion appears for departing from the usual order that costs follow the event, particularly as the impecuniosity of the losing party is not regarded as a ground for refraining from making an order as to costs in most circumstances. Further, it is appropriate that the order for costs in respect of the contempt proceeding be on an indemnity basis. In effect, the applicant applies for punishment for contempt of court to vindicate the authority of the Court. He, or the creditors indemnifying him in the principal proceeding, ought not be out of pocket for costs for performing their function on behalf of the Court. Although it is clear that the proceeding for contempt is to be regarded as a separate proceeding from the principal proceeding, for the avoidance of doubt, I should make an order pursuant to O 62 r 3(2) of the Federal Court Rules that the costs of the contempt proceeding be paid forthwith.


case_title: Australian Industrial Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia & Ors [2001] FCA 774 (2001) 188 ALR 653


case_text: In Re Colina; Ex parte Torney [1999] HCA 57 (1999) 200 CLR 386, the High Court dealt with the question whether a person charged with contempt of the Family Court of Australia by scandalising the court was required to be tried by jury under s 80 of the Constitution . By majority, the High Court held that, for the purposes of s 35 of the Family Law Act 1975 (Cth) (the Family Court's equivalent provision to s 31 of the Federal Court Act), contempt of court did not fall within the phrase 'any offence against any law of the Commonwealth' in s 80 of the Constitution . See Colina at [16] [25] per Gleeson CJ and Gummow J and [108] [113] per Hayne J. McHugh J at [35] [50] and Kirby J at [70] [81] expressed the contrary view. The judgment of Callinan J, especially at [119] [136], focused more upon the words 'trial on indictment' in s 80 of the Constitution . It therefore appears that the majority view is that contempt of a court created by Parliament under Ch III of the Constitution is not an offence against any law of the Commonwealth, for the purposes of s 80 of the Constitution . If that be the case, then it is likely to follow that contempt of such a court does not fall within the meaning of the phrase 'an offence against the law of the Commonwealth', despite the use of the definite article in that phrase, as against the indefinite article in s 80 of the Constitution .


case_text: Section 20AB of the Crimes Act 1914 (Cth) therefore appears to have no application to such a contempt, and the range of sentencing alternatives specified in s 20AB(1) is not available. To the extent to which Moore J suggested to the contrary in Reches Pty Ltd v Tadiran Limited [2001] FCA 1486 at [22] , I respectfully disagree. His Honour's statement that a community service order fell within the range of penalties for contempt was obiter, in that his Honour did not make a community service order in the particular case. What his Honour said was based on Registrar of the Court of Appeal v Maniam [No 2] (1992) 26 NSWLR 309. In that case, the New South Wales Court of Appeal expressed the view that the Supreme Court of New South Wales had power to impose a community service order in respect of a contempt of court, constituted by disobedience of an order of the court in refusing to respond to a subpoena to attend as a witness. See at 319 per Kirby P, 320 per Mahoney JA agreeing with Kirby P and 320-321 per Hope A-JA, again agreeing with Kirby P. An examination of what Kirby P said indicates that his Honour saw the power as arising from the inherent power of the Supreme Court of New South Wales. The actual order was for the imposition of a fine, suspended on condition that the contemnor undertook to the court that he would perform a certain number of hours of voluntary service of a particular kind. The court did not therefore impose directly an order that the contemnor perform community service. It accepted his undertaking to do so in lieu of payment of a fine it imposed. There is no doubt that it could not have taken this step if it did not have the power to make a community service order in the first place. This Court certainly does not have the power to accept undertakings that it would not have the power to enforce by injunction: Thomson Australian Holdings Pty Ltd v Trade Practices Commission [1981] HCA 48 ; (1981) 148 CLR 150. As a creature of statute, pursuant to the power of Parliament in Ch III of the Constitution , this Court has a different character from the Supreme Court of a State. There is a need for caution when talking of inherent powers, particularly where specific powers are conferred on the Court by statute. The terms of s 31 of the Federal Court Act and s 24 of the Judiciary Act are so specific as to make it clear that this Court is restricted to common law penalties for contempt of court. Those penalties are limited to a fine, a term of imprisonment or a combination of the two.


case_outcome: distinguished

case_title: Registrar of the Court of Appeal v Maniam [No 2] (1992) 26 NSWLR 309


case_title: Thomson Australian Holdings Pty Ltd v Trade Practices Commission [1981] HCA 48 ; (1981) 148 CLR 150


case_text: That is not to say that all forms of orders ancillary to fines and imprisonment are beyond the power of the Court. For this purpose, resort may be had to the general power to make orders in relation to matters in which it has jurisdiction, granted by s 23 of the Federal Court Act. It has been recognised that the power to impose a sentence of imprisonment includes a power to suspend that sentence on conditions. See Australian Competition and Consumer Commission v Goldstar Corporation Pty Ltd (unreported, Federal Court of Australia, Drummond J, 6 November 1998) and Australian Securities & Investments Commission v Matthews [1999] FCA 803 (1999) 32 ACSR 404 at [29] .


case_title: Australian Securities & Investments Commission v Matthews [1999] FCA 803 (1999) 32 ACSR 404


case_outcome: discussed

case_text: The contention of the applicant in the present case that the Court could debar the respondents from defending the proceeding, and strike out their defences, is based on a comment of Lord Donaldson of Lymington MR in Derby & Co Ltd v Weldon (Nos. 3 and 4) [1990] 1 Ch 65 at 81. In that case, the English Court of Appeal was considering whether it was appropriate for a court to grant a Mareva -type injunction in respect of assets beyond the jurisdiction of the court. Relevant to that question was the question whether such an injunction could be enforced in any event. The Master of the Rolls said: 'in the context of the grant of the Mareva injunction, I think that a sufficient sanction exists in the fact that, in the event of disobedience, the court could bar the defendant's right to defend. This is not a consequence which it could contemplate lightly as it would become a fugitive from a final judgment given against it without its explanations having been heard and which might well be enforced against it by other courts.' Neill LJ at 87 and Butler-Sloss LJ at 96 expressed agreement with the judgment of the Master of the Rolls. Each went on to deal with the issues in the case, with Neill LJ at 95 expressing specific agreement with what the Master of the Rolls had said about enforceability. Butler-Sloss LJ did not comment specifically on that issue. It is unnecessary in the present case to debate the question whether barring the right to defend a proceeding falls within the range of penalties the Court could impose for contempt of court. Order 35A of the Federal Court Rules contains specific provisions about the powers of the Court in the event of default of a party in complying with an order. Order 35A r 2(2)(d) provides that a respondent is in default by failing to comply with an order of the Court in a proceeding. Order 35A r 3(2)(c) provides that, if a respondent is in default, the Court may: 'if the proceeding was commenced by an application supported by a statement of claim or the Court has ordered that the proceeding continue on pleadings -- give judgment against the respondent for the relief that: (i) the applicant appears entitled to on the statement of claim; and (ii) the Court is satisfied it has power to grant'. Order 35A r 3(2)(d) also provides that, if a respondent is in default, the Court may give judgment or make any other order against the respondent. Order 35A r 4 specifically provides that O 35A does not limit the power of the Court to punish for contempt. It must be the case, however, that, if the Court exercises its power to give judgment against a respondent, on the ground that the respondent has failed to comply with an order of the Court, and the giving of judgment has significant consequences for the respondent, those consequences could be taken into account as factors mitigating the exercise of the Court's powers to punish for contempt. 52 The contempt in this case is a serious one. It involved a significant sum of money, $73 987.57. As I have said, Ms Bell was well aware that an injunction had been granted, restricting her freedom of action in relation to the sale of the Mariners Place property, and her freedom of action to deal with the proceeds of sale if a sale were effected. She chose not to have regard to the terms of that order. She preferred to satisfy her obligations, or perceived obligations, and to spend the money for her own purposes, instead of complying with the injunction. In short, she preferred her own interests, and even her own whims, to her duty to comply with the injunction. The effect of the contempt on the administration of justice is also of major significance. If Ms Bell had complied with the injunction, the applicant would have been secure in the knowledge that he could bring the proceeding to its conclusion and, if he were to be successful, there would be a substantial asset available to satisfy the judgment and to augment the estate of the bankrupt, for the benefit of the bankrupt's creditors. There is now a powerful disincentive to the applicant in proceeding to a conclusion, because the execution of any judgment is much less likely to prove fruitful. This consequence can be ameliorated to some extent by exercising the power to give judgment summarily against Ms Bell, thereby saving the applicant from the need to expend further costs in the proceeding, but it still renders the proceeding largely fruitless for the applicant if, as appears to be the case, Ms Bell has no means of satisfying a judgment. The effect of the contempt, therefore, is to tilt the balance in the litigation heavily against the applicant. 53 There can be little doubt that a contempt of this magnitude, coupled with the degree of culpability of Ms Bell (amounting to wilful blindness as to the terms of the order, as I have said, and to preferring to satisfy her own needs and desires) would warrant a significant term of imprisonment. Only if there are powerful mitigating factors would it be appropriate to consider a course other than imprisonment as a minimum step. It is therefore necessary to turn to the mitigating factors. 54 Ms Bell claims that she did not understand the nature of the order and therefore that she did not intend to commit a breach of it or to demonstrate any disrespect for the Court. She has expressed her contrition for her failure to comply, and has apologised to the Court. I accept that she did not in fact understand the terms of the order, although they had been explained to her by her then counsel, and she was in possession of a copy of the order. Although I do not consider that the order is a particularly complex one, I can accept that legal terminology and drafting techniques can make an order less than wholly comprehensible to some people. 55 The fact is, however, as I have found, that Ms Bell did not pay any heed to the order at all. She did not take the trouble to read it in the context of the conduct of the auction of the Mariners Place property, or in the context of her disposal of the proceeds of sale. She did not provide the agent responsible for the sale, or the auctioneer, with the copy of the order that she had, either for the purpose of guiding their conduct, or for the purpose of seeking guidance from them as to her own. She did not seek advice from Kelly & Chapman, who were then acting for her in the principal proceeding. She simply decided not to have regard to the order. Even when her contravention of it was pointed out to her, she took no immediate steps to remedy the contravention. Her initial explanation, in her affidavit of 21 September 2006, was anything but frank as to what had happened to the proceeds. It was necessary for me to make a further order on 25 September 2006, requiring Ms Bell to make an affidavit, explaining specifically the manner in which the sum of $73 987.57 had been expended. Even then, in her affidavit of 9 October 2006, she was vague about a number of the payments she had made. Both of these affidavits were prepared by her without legal assistance, which is a partial explanation for their inadequacy. Even when she swore her affidavit of 18 December 2006, prepared with the assistance of her pro bono lawyers, no further detail was provided. Only in her oral evidence, and under cross-examination, was further detail about the payments obtained. Her expression of contrition and her formal apology to the Court only came about after she had received the advice of her counsel as to the seriousness of her position.


case_title: Viner v Australian Building Construction Employees' and Builders Labourers' Federation (No 1) (1981) 56 FLR 5

case_text: Although commenced by notice of motion entitled in the principal proceeding, the application for punishment for contempt of court is to be regarded as a separate proceeding in its own right. See Viner v Australian Building Construction Employees' and Builders Labourers' Federation (No 1) (1981) 5 FLR 5 at 27 32 and Australian Building Construction Employees' and Builders Labourers' Federation v Viner (1982) 63 FLR 253 at 266 per Evatt and Deane JJ. Having been found guilty of contempt of court, Ms Bell should be ordered to pay the costs of that proceeding. No occasion appears for departing from the usual order that costs follow the event, particularly as the impecuniosity of the losing party is not regarded as a ground for refraining from making an order as to costs in most circumstances. Further, it is appropriate that the order for costs in respect of the contempt proceeding be on an indemnity basis. In effect, the applicant applies for punishment for contempt of court to vindicate the authority of the Court. He, or the creditors indemnifying him in the principal proceeding, ought not be out of pocket for costs for performing their function on behalf of the Court. Although it is clear that the proceeding for contempt is to be regarded as a separate proceeding from the principal proceeding, for the avoidance of doubt, I should make an order pursuant to O 62 r 3(2) of the Federal Court Rules that the costs of the contempt proceeding be paid forthwith.


case_outcome: applied

case_title: Dragojlovic v Director General of Social Security (1984) 1 FCR 301

case_text: In its decision the Tribunal quoted from the decision of Smithers J in Dragojlovic v Director-General of Social Security (1984) 1 FCR 301 at 305 where his Honour said: "In any case in which treatment is refused the question for the respondent or the Tribunal is not whether the refusal is reasonable or otherwise, but whether, on the probabilities, the refusal is genuinely based on grounds which, in fact, compel the person concerned, acting honestly, so to refuse ..." 17 It is true, as Ms Macdonnell pointed out, that Dragojlovic and Koutsakis were concerned with different statutory criteria. In Dragojlovic the Tribunal, confirming an order for the cancellation of an invalid pension, had found as a fact that the applicant had unreasonably refused to undergo a lumbar laminectomy. Smithers J dealt first with the general provision in s 23 of the Social Security Act 1947 (Cth) (originally the Social Services Act 1947 but title amended by Act No 37 of 1982). Section 23 provided that a person shall be deemed to be permanently incapacitated for work if the degree of permanent incapacity for work is not less than 85 per cent. His Honour at 302 quoted with approval a decision of Todd DP in Re Korovesis v Director General of Social Security (1983) 6 ALD 244 to the effect that a claimant for a pension "cannot be compelled to have an operation". 19 His Honour at 303, pointed out, as had Todd DP, the difference between, on the one hand, pension claims and, on the other, workers compensation and tort claims. In the latter case, objectively unreasonable refusal to undergo medical treatment may bring to an end the liability of employer or defendant to compensate. However in the former case, in the words of Todd DP, quoted with approval by Smithers J at 303: " ...there is no element of compensation or redress of damage involved in the provisions of the Act in question. Those provisions relate to the objective provision of a minimum level of support, to determining whether a 'safety net' should be placed under a person in crisis. In the case of invalid pensions, such support is to be given where he or she is, for the foreseeable future, incapacitated for work." At 304 his Honour said: "Of course, it has been felt to be unsatisfactory that a person who refuses to undergo treatment which would probably cure his incapacity and which it would be reasonable, objectively regarded, for him to undergo, should qualify for a pension. Common sense suggests that it would be unfair that the community should pay a pension to such a person. As a result, it has been thought proper to import, by analogy, the notion that incapacity which is curable by the adoption of measures which it is objectively reasonable to take, is not permanent incapacity. There is however, in my opinion, no warrant for this. Under the Act qualification for a pension depends upon a state of fact. The Act does not lay down as a condition of the qualification that there be a reasonable cause for its existence. At the same time, to treat an incapacity as permanent, simply because a claimant will not take steps to be cured would be unacceptable from any point of view." Later his Honour said at 305: "In any case in which treatment is refused the question for the respondent or the Tribunal is not whether the refusal is reasonable or otherwise, but whether, on the probabilities, the refusal is genuinely based on grounds which, in fact, compel the person concerned, acting honestly, so to refuse." As his Honour emphasised, the question is one of bona fides. 20 In Dragojlovic the case actually turned on a more specific provision of the 1947 Act, namely s 135M(1), which dealt with refusal or cancellation of a pension where the person did not receive treatment for "physical rehabilitation" or "suitable training for a vocation". Suffice to say Smithers J construed that provision consistently with his views on the policy and purpose of the Act. 21 In Koutsakis a Full Court at 45 noted: "The cases make it clear that the mere failure of a person to undertake medical or other treatment which is recommended to him does not disentitle him from receiving a pension or an award of compensation". Their Honours agreed with and adopted what as said by Smithers J in Dragojlovic and said at 45: "... there is no finding that the appellant's fears are not genuinely entertained by him. In our opinion, the mere fact that the appellant's fears are groundless does not make them unreasonable if they are genuine". 24 The Tribunal's emphasis on the lack of "grounds" indicates that it was treating the test as objective. While the Tribunal cited a passage from Dragojlovic , read as a whole Smithers J is not saying that the person seeking to obtain, or maintain, a pension must show some reason or fact external to his or her decision not to undergo the treatment in question. On the contrary, the emphasis is on subjective good faith, or the lack thereof, in the person's decision, however irrational it may seem. This view of Dragojlovic is confirmed by what the Full Court said in Koutsakis . 26 If the Tribunal came to the view that Mr Jansen was not acting bona fide but rather, in the words of Smithers J as "the result of a tactical exercise designed to obtain a pension" ( Dragojlovic at 305), fairness would demand a clear finding to that effect, with reasons. The lack of such a finding points to a conclusion that the Tribunal misunderstood the correct test. 27 McKinnon had nothing to do with social security. It was a claim for damages for personal injuries allegedly caused by the negligence of the Commonwealth and New South Wales Governments (proceeding NG 518 of 1996). The question before Hill J was whether the proceeding should be stayed until the applicant attended a medical examination arranged by the respondents. The Tribunal's citing of McKinnon strongly suggests that it misunderstood the question for its decision. A point made at some length in Dragojlovic is that the objective reasonableness of proposed medical treatment will be relevant for common law in workers compensation claims but not under a social security regime.


case_text: The Tribunal went on to say that that view was adopted by the Full Federal Court in Koutsakis v Director-General of Social Security (1985) 10 FCR 42. The Tribunal continued at [12]: "In McKinnon v Commonwealth of Australia [1998] FCA 1456 the Court referred to the balancing exercise between the possible harm to an applicant in undertaking treatment and the interests of the respondent in having the treatment carried out." 17 It is true, as Ms Macdonnell pointed out, that Dragojlovic and Koutsakis were concerned with different statutory criteria. In Dragojlovic the Tribunal, confirming an order for the cancellation of an invalid pension, had found as a fact that the applicant had unreasonably refused to undergo a lumbar laminectomy. Smithers J dealt first with the general provision in s 23 of the Social Security Act 1947 (Cth) (originally the Social Services Act 1947 but title amended by Act No 37 of 1982). Section 23 provided that a person shall be deemed to be permanently incapacitated for work if the degree of permanent incapacity for work is not less than 85 per cent. His Honour at 302 quoted with approval a decision of Todd DP in Re Korovesis v Director General of Social Security (1983) 6 ALD 244 to the effect that a claimant for a pension "cannot be compelled to have an operation". 21 In Koutsakis a Full Court at 45 noted: "The cases make it clear that the mere failure of a person to undertake medical or other treatment which is recommended to him does not disentitle him from receiving a pension or an award of compensation". Their Honours agreed with and adopted what as said by Smithers J in Dragojlovic and said at 45: "... there is no finding that the appellant's fears are not genuinely entertained by him. In our opinion, the mere fact that the appellant's fears are groundless does not make them unreasonable if they are genuine". 24 The Tribunal's emphasis on the lack of "grounds" indicates that it was treating the test as objective. While the Tribunal cited a passage from Dragojlovic , read as a whole Smithers J is not saying that the person seeking to obtain, or maintain, a pension must show some reason or fact external to his or her decision not to undergo the treatment in question. On the contrary, the emphasis is on subjective good faith, or the lack thereof, in the person's decision, however irrational it may seem. This view of Dragojlovic is confirmed by what the Full Court said in Koutsakis .


case_text: The Tribunal went on to say that that view was adopted by the Full Federal Court in Koutsakis v Director-General of Social Security (1985) 10 FCR 42. The Tribunal continued at [12]: "In McKinnon v Commonwealth of Australia [1998] FCA 1456 the Court referred to the balancing exercise between the possible harm to an applicant in undertaking treatment and the interests of the respondent in having the treatment carried out." 27 McKinnon had nothing to do with social security. It was a claim for damages for personal injuries allegedly caused by the negligence of the Commonwealth and New South Wales Governments (proceeding NG 518 of 1996). The question before Hill J was whether the proceeding should be stayed until the applicant attended a medical examination arranged by the respondents. The Tribunal's citing of McKinnon strongly suggests that it misunderstood the question for its decision. A point made at some length in Dragojlovic is that the objective reasonableness of proposed medical treatment will be relevant for common law in workers compensation claims but not under a social security regime.


case_text: It is true, as Ms Macdonnell pointed out, that Dragojlovic and Koutsakis were concerned with different statutory criteria. In Dragojlovic the Tribunal, confirming an order for the cancellation of an invalid pension, had found as a fact that the applicant had unreasonably refused to undergo a lumbar laminectomy. Smithers J dealt first with the general provision in s 23 of the Social Security Act 1947 (Cth) (originally the Social Services Act 1947 but title amended by Act No 37 of 1982). Section 23 provided that a person shall be deemed to be permanently incapacitated for work if the degree of permanent incapacity for work is not less than 85 per cent. His Honour at 302 quoted with approval a decision of Todd DP in Re Korovesis v Director General of Social Security (1983) 6 ALD 244 to the effect that a claimant for a pension "cannot be compelled to have an operation".


case_text: After hearing the parties on 10 March 2006, the court adjourned upon the understanding that judgment would be delivered later that day. In the interim, however, the first respondent faxed further submissions, drawing attention to SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCAFC 2 at [216] per Allsop J and [155] per Weinberg J (" SZEEU "). As a result, a further hearing was rescheduled for 24 April 2006 to enable the applicant to obtain assistance from pro bono counsel on these further submissions. 15 At the hearing on 24 April 2006, pro bono counsel sought leave to amend the applicant's proposed notice of appeal to include the following ground of appeal: "The Federal Magistrates' Court should have found that the decision of the Refugee Review Tribunal was made in jurisdictional error in that the Tribunal failed to comply with s 424A of the Act when the Tribunal failed to provide particulars of information to the applicant, where this information was: i. part of the reasons for its decision; and ii. did not fall within the exception in s 424(3). Particulars The form and content of the appellant's evidence given to the Department. The assurance about privacy contained in the letter from the Department to the [Applicant] dated 18 February 2002." 16 Counsel for the applicant submitted that the RRT breached s 424A of the Act with respect to two pieces of information, i.e., with respect to (1) the form and content of the applicant's evidence given to the Department, particularly the omission in this evidence of certain claims the applicant made to the RRT; and (2) the assurance about privacy contained in the letter from the Department to the applicant dated 18 February 2002. She submitted that both pieces of information constituted "information" within the meaning of s 424A(1) of the Act ; and were part of the reasons for affirming the decision under review. It followed, so she said, that the RRT breached s 424A when it failed to provide particulars of these pieces of information to the applicant in accordance with the Act . Further, counsel for the applicant contended that there was no alternate basis for the RRT's decision that was unaffected by the s 424A error. 17 As counsel for the applicant acknowledged, the proposed ground of appeal raised a basis for a claim of jurisdictional error on the RRT's part that had not been argued before the Federal Magistrate. The court may allow such a ground to be argued on an appeal if it is satisfied that it is expedient in the interests of justice to allow the new ground to be argued and determined: see VAAC v Minster for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 74 ; (2003) 129 FCR 168 (" VAAC ") at 177 [26] per North, Merkel and Weinberg JJ. It is only at this late stage in this proceeding that the applicant has had the benefit of counsel and this provides part of the explanation for the applicant's failure to raise the ground earlier. There is also the further fact that SZEEU was only delivered on 24 February 2006. In addition to this consideration, whether or not leave ought be granted depends on such matters as the prospects of success of the proposed new ground, the prejudice to the first respondent in allowing the ground to be raised, the possible serious consequences to the applicant if the leave sought is refused, and the integrity of the appellate process: see VAAC at 177 [26]. 23 The RRT's knowledge that the standard letter contained an assurance of privacy can be regarded as 'information' for the purposes of s 424A. The Court in SZEEU treated the discussion of the word 'information' in VAF v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 206 ALR 471 (" VAF ") as a point of departure for its own consideration of the appeals before it. In VAF , Finn and Stone JJ said, at [24]: " [T] here is now a considerable body of case law concerned with the compass of the term 'information' in its s 424A(1) setting. The following propositions emerge from it: (i ) the purpose of s 424A is to provide in part a statutory procedural analogue to the common law of procedural fairness: Paul v Minister for Immigration and Multicultural Affairs [2001] FCA 1196 ; (2001) 113 FCR 396 at [104] . However the obligation imposed is not coextensive with that which might be imposed by the common law to avoid practical injustice: VAAC ... ; (ii) the word "information" in s 424A(1) has the same meaning as in s 424: Win v Minister for Immigration and Multicultural Affairs [2001] FCA 56 ; (2001) 105 FCR 212 at [20] ; and in this setting it refers to knowledge of relevant facts or circumstances communicated to or received by the Tribunal: Tin v Minister for Immigration and Multicultural Affairs [2000] FCA 1109 at [3] ; irrespective of whether it is reliable or has a sound factual basis: Win , at [19]-[22]; and (iii) the word does not encompass the Tribunal's subjective appraisals, thought processes or determinations: Tin at [54]; Paul at [95]; Singh v Minister for Immigration and Multicultural Affairs [2001] FCA 1679 at [25] ; approved [2002] FCAFC 120 ; nor does it extend to identified gaps, defects or lack of detail or specificity in evidence or to conclusions arrived at by the Tribunal in weighing up the evidence by reference to those gaps, etc: WAGP of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 266 ; (2002) 124 FCR 276 at [26] - [29] ." 24 The Court in SZEEU accepted that the word 'information' in s 424A refers to "knowledge of relevant facts or circumstances communicated to or received by the Tribunal": see SZEEU at [23]-[25] per Moore J, at [94], [157], [171] per Weinberg J and [205] per Allsop J, although Allsop J stated, at [208], that there were limits on the statement in VAF that 'information' did not encompass or extend to identified gaps, defects or lack of detail or specificity in evidence or to conclusions arrived at by the RRT in weighing up the evidence by reference to those gaps. 26 On a fair reading of the RRT's reasons for its decision, the RRT's knowledge that the standard letter contained an assurance of privacy was knowledge that the RRT considered was a part of the reason it affirmed the decision under review. In SZEEU , Weinberg J discussed, at [163], the application of the expression "a part of the reason" in s 424A , observing that: "The strict view that the courts have taken in relation to breaches of natural justice can, in my view, inform the application of the expression 'a part of the reason' in s 424A. The cases suggest that this expression should be read benevolently, in favour of an applicant for review. If there is any doubt as to whether information that is adverse to an applicant did form a part of the reason for decision, that doubt should generally be resolved in favour of the applicant." 27 His Honour accepted, at [164], that "the similar claims information" in the case of SZBMI "played a part ... in the Tribunal's conclusion"; and therefore constituted a part of the reason for its decision. Weinberg J explained, at [164], that: "The fact is that the Tribunal regarded the similar claims information as a significant matter, sufficiently important to warrant specific mention. Although the Tribunal dealt with the matter as though it simply bolstered a conclusion that it had already arrived at, rather than an element in the decision-making process, it does not follow that it did not play "a part" in its reasons for decision. ... The actual process by which a decision is reached is, of course, a complex matter. It is not always as neat as the reasons themselves may suggest. The reasoning may not proceed in a linear fashion, and the Tribunal's reasons must, of course, be read as a whole." 28 Allsop J, in SZEEU at [216]-[217], explained the application of the expression "a part of the reason" as follows: "In my view, in the light of [SAAP Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24 ; (2005) 215 ALR 162] , in circumstances where one is faced with a decision of the Tribunal with reasons and the complaint is a contravention of s 424A(1) , the question to ask, by reference to the reasons of the Tribunal in the context in which one finds them (as revealing what would be the reason or a part of the reason for affirming the decision immediately prior to the making of the decision), is whether the information in question was a part (that is any part) of the reason for affirming the decision. To the extent that the reasons of the relevant majorities in [Paul v Minister for Immigration and Multicultural Afairs [2001] FCA 1196 ; (2001) 113 FCR 396] and VAF can be seen to require that the relevant part of the reason have a stature or importance, or be of a character, which would make it unfair not to invoke the procedures of s 424A , I think SAAP requires that such an approach be rejected. It is only necessary that the information be a part of the reason. That said, it is necessary to recognise the guidance that one nevertheless receives from aspects of [33] in VAF . One always needs to analyse and interpret the reason s of the Tribunal in order to understand the reason for the ultimate reason or conclusion of the lack of satisfaction of the existence of protection obligations. Merely because something is contained in the text of the reasons of the Tribunal which involves "information" does not conclude the question whether it was (and, in the relevant sense, would be) a part of the reason for affirming the decision. The whole of the written reasons must be analysed and interpreted in their context to assess why it was that the Tribunal acted as it did (and so, in the relevant sense, to assess what would be, prior to making the decision, the reason or a part of the reason). Having thus ascertained the reason or reasons (if there be more than one) why the Tribunal was not relevantly satisfied, any information that was (and thus, in the relevant sense, would be) a part of the reasoning process to explain such reason engages the operation of s 424A , without any additional requirement (for which Paul and VAF appear to call) that the relative importance of the information to the reasoning process be assessed to form a judgment as to whether fairness requires the engagement of s 424A. The above tasks of assessment or interpretation of the Tribunal's reasons, of ascertaining what was any reasoning process and of assessing the relevance of any information thereto may not be straightforward and may lead to conclusions about which minds may differ." 29 The observations of Weinberg and Allsop JJ in SZEEU are helpful in this case, because, clearly enough, the standard letter played a part in the RRT's reasons for its decision, even if only a subsidiary part: see also SZEEU at [158] agreeing with Allsop J at [228] above. As previously noted, before the RRT, the applicant claimed that he feared persecution based on his own association with the LTTE, although he had not mentioned these claims until he gave evidence at the RRT hearing. 30 The RRT rejected this claim about his own involvement with the LTTE as "not credible", because, if genuine, the applicant would have mentioned the claim to the delegate or in his statement seeking review of the delegate's decision. The RRT rejected the applicant's explanation for his failure to mention the claim earlier on the joint bases of importance and confidentiality. In relation to confidentiality, the RRT referred to the assurances given both at the interview with the delegate and in the standard letter. The reference to the standard letter was apparently intended to take account of the fact that the applicant said that he could not recall being given such an assurance at the interview with the delegate. In effect, the standard letter was a part of the RRT's reasons for its decision because it provided a part of the reason for rejecting the applicant's explanation as to why he gave an account of personal involvement so late in the piece and thus for disbelieving this account. There were not, as the respondent maintained, three separate bases for the RRT's rejection of the applicant's explanation for failing to mention his own LTTE involvement until the oral hearing before the RRT. The matter of the standard letter was intertwined with the RRT's view that the applicant's explanation for his late claims should be rejected because of earlier assurances of confidentiality. 31 As noted earlier, the first respondent also contended that, even if there were a breach in this regard, the decision of the RRT was supportable on an independent basis that was not affected by the breach. This was that the RRT would have found the applicant's account not credible also on the basis that it did not find his evidence plausible. I reject this submission because, read fairly and as a whole, the RRT's finding that the applicant was not credible flowed from its determination that, if true, the applicant would have made his personal involvement claim earlier and its assessment that his evidence was vague, unresponsive and implausible. That is, the RRT treated these two considerations as supporting, together or cumulatively, its credibility finding. The RRT expressed the idea of cumulation when it said that it "also gives weight to the fact" that the applicant's evidence was general, unresponsive and implausible. Reading the RRT's reasons as a whole, it is plain enough that it relied on 'recent invention' and 'implausibility' as jointly founding its credibility finding. The RRT did not treat implausibility as a stand-alone basis for rejecting his claim on credibility grounds.


case_outcome: referred to

case_text: As counsel for the applicant acknowledged, the proposed ground of appeal raised a basis for a claim of jurisdictional error on the RRT's part that had not been argued before the Federal Magistrate. The court may allow such a ground to be argued on an appeal if it is satisfied that it is expedient in the interests of justice to allow the new ground to be argued and determined: see VAAC v Minster for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 74 ; (2003) 129 FCR 168 (" VAAC ") at 177 [26] per North, Merkel and Weinberg JJ. It is only at this late stage in this proceeding that the applicant has had the benefit of counsel and this provides part of the explanation for the applicant's failure to raise the ground earlier. There is also the further fact that SZEEU was only delivered on 24 February 2006. In addition to this consideration, whether or not leave ought be granted depends on such matters as the prospects of success of the proposed new ground, the prejudice to the first respondent in allowing the ground to be raised, the possible serious consequences to the applicant if the leave sought is refused, and the integrity of the appellate process: see VAAC at 177 [26].


case_text: The RRT's knowledge that the standard letter contained an assurance of privacy can be regarded as 'information' for the purposes of s 424A. The Court in SZEEU treated the discussion of the word 'information' in VAF v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 206 ALR 471 (" VAF ") as a point of departure for its own consideration of the appeals before it. In VAF , Finn and Stone JJ said, at [24]: " [T] here is now a considerable body of case law concerned with the compass of the term 'information' in its s 424A(1) setting. The following propositions emerge from it: (i ) the purpose of s 424A is to provide in part a statutory procedural analogue to the common law of procedural fairness: Paul v Minister for Immigration and Multicultural Affairs [2001] FCA 1196 ; (2001) 113 FCR 396 at [104] . However the obligation imposed is not coextensive with that which might be imposed by the common law to avoid practical injustice: VAAC ... ; (ii) the word "information" in s 424A(1) has the same meaning as in s 424: Win v Minister for Immigration and Multicultural Affairs [2001] FCA 56 ; (2001) 105 FCR 212 at [20] ; and in this setting it refers to knowledge of relevant facts or circumstances communicated to or received by the Tribunal: Tin v Minister for Immigration and Multicultural Affairs [2000] FCA 1109 at [3] ; irrespective of whether it is reliable or has a sound factual basis: Win , at [19]-[22]; and (iii) the word does not encompass the Tribunal's subjective appraisals, thought processes or determinations: Tin at [54]; Paul at [95]; Singh v Minister for Immigration and Multicultural Affairs [2001] FCA 1679 at [25] ; approved [2002] FCAFC 120 ; nor does it extend to identified gaps, defects or lack of detail or specificity in evidence or to conclusions arrived at by the Tribunal in weighing up the evidence by reference to those gaps, etc: WAGP of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 266 ; (2002) 124 FCR 276 at [26] - [29] ." 24 The Court in SZEEU accepted that the word 'information' in s 424A refers to "knowledge of relevant facts or circumstances communicated to or received by the Tribunal": see SZEEU at [23]-[25] per Moore J, at [94], [157], [171] per Weinberg J and [205] per Allsop J, although Allsop J stated, at [208], that there were limits on the statement in VAF that 'information' did not encompass or extend to identified gaps, defects or lack of detail or specificity in evidence or to conclusions arrived at by the RRT in weighing up the evidence by reference to those gaps.


case_text: Allsop J, in SZEEU at [216]-[217], explained the application of the expression "a part of the reason" as follows: "In my view, in the light of [SAAP Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24 ; (2005) 215 ALR 162] , in circumstances where one is faced with a decision of the Tribunal with reasons and the complaint is a contravention of s 424A(1) , the question to ask, by reference to the reasons of the Tribunal in the context in which one finds them (as revealing what would be the reason or a part of the reason for affirming the decision immediately prior to the making of the decision), is whether the information in question was a part (that is any part) of the reason for affirming the decision. To the extent that the reasons of the relevant majorities in [Paul v Minister for Immigration and Multicultural Afairs [2001] FCA 1196 ; (2001) 113 FCR 396] and VAF can be seen to require that the relevant part of the reason have a stature or importance, or be of a character, which would make it unfair not to invoke the procedures of s 424A , I think SAAP requires that such an approach be rejected. It is only necessary that the information be a part of the reason. That said, it is necessary to recognise the guidance that one nevertheless receives from aspects of [33] in VAF . One always needs to analyse and interpret the reason s of the Tribunal in order to understand the reason for the ultimate reason or conclusion of the lack of satisfaction of the existence of protection obligations. Merely because something is contained in the text of the reasons of the Tribunal which involves "information" does not conclude the question whether it was (and, in the relevant sense, would be) a part of the reason for affirming the decision. The whole of the written reasons must be analysed and interpreted in their context to assess why it was that the Tribunal acted as it did (and so, in the relevant sense, to assess what would be, prior to making the decision, the reason or a part of the reason). Having thus ascertained the reason or reasons (if there be more than one) why the Tribunal was not relevantly satisfied, any information that was (and thus, in the relevant sense, would be) a part of the reasoning process to explain such reason engages the operation of s 424A , without any additional requirement (for which Paul and VAF appear to call) that the relative importance of the information to the reasoning process be assessed to form a judgment as to whether fairness requires the engagement of s 424A. The above tasks of assessment or interpretation of the Tribunal's reasons, of ascertaining what was any reasoning process and of assessing the relevance of any information thereto may not be straightforward and may lead to conclusions about which minds may differ." 32 The effect of SAAP Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24 ; (2005) 215 ALR 162 is that s 424A of the Act requires the RRT, at the hearing stage, to give the applicant 'particulars' in writing of any information that would be the reason, or a part of the reason, for affirming the decision under review; and any breach of this requirement constitutes jurisdictional error. 33 In view of this conclusion, it is unnecessary to consider the applicant's counsel's further submission concerning the form and content of the applicant's evidence given to the Department. I observe that the first respondent's counsel noted, in argument, that he had no notice of this latter submission prior to the 24 April hearing, although no blame attaches to pro bono counsel for this apparent fact. 34 If leave to amend the notice of appeal were granted and an extension of time were granted, the appeal would succeed. The first respondent has not argued that, if the court so concluded, then it should not grant leave because of any countervailing considerations. Accordingly, I would grant leave to amend the proposed notice of appeal in the terms sought by pro bono counsel. I would also grant the extension of time the applicant sought and I would allow the appeal, with costs.


case_text: G & J Gears conceded that it had not satisfied the statutory demand within the period for compliance allowed by the registrar, but it contended that the court could extend the time for compliance because it had made an application for an extension before the time fixed by the registrar had passed. In support of this contention, it referred to Equuscorp Pty Ltd v Perpetual Trustees WA Ltd (1997) 25 ACSR 675 (" Equuscorp ") at 701 per French, Kiefel and Sundberg JJ. G & J Gears contended that the court should exercise the discretion it had in its favour, amongst other reasons, because the review would otherwise be nugatory. 36 Further, G & J Gears also relied on s 459F(2)(a)(ii) of the Corporations Act in support of its submission that the Court could and should make an order extending the time for compliance with the demand, notwithstanding that the time allowed under the registrar's order had passed. It argued that s 459F(2)(a)(ii) meant that the period for compliance with the statutory demand did not terminate until "7 days after the application under section 459G is finally determined or otherwise disposed of" and that the application was not finally determined by the registrar's decision. Counsel for G & J Gears contended that there was no final determination until after the review of the registrar's decision had occurred. 37 G & J Gears did not dispute the amount of its indebtedness to Brobo as found by the registrar. It contended, however, that the statutory demand should be set aside because the company had offsetting claims within the meaning of s 459H of the Corporations Act . These claims were: (1) a trademark infringement claim in respect of the Little Rock mark; (2) a claim that Brobo had unlawfully induced Rockcrusher-USA to breach its sole distribution agreement with G & J Gears; (3) a breach of contract claim; and (4) a claim that Brobo had unlawfully converted G & J Gears' designs, patterns and tools to its own use. The trademark infringement claim was the subject of Shirley's affidavit of 2 September 2005, whilst the other claims were not raised prior to Davis's affidavit of 8 November 2005 and were dealt with substantially in an affidavit sworn by Shirley on 6 February 2006. The affidavit of 6 February 2006 was not, of course, before the Registrar. Further, only the trademark infringement claim was raised as a ground in the company's initial affidavit filed pursuant to s 459G(3) of the Corporations Act . That is, the only basis for an offsetting claim initially disclosed in the application made by G & J Gears under s 459G was the alleged wrongful sale by Brobo of two containers of G & J Gears' goods and the consequential breach of the Little Rock mark. 48 Upon G & J Gears' application, the Court would have had power to extend time further at any time after the registrar made the order extending time until the expiry of that time. It would have been open to the company to have made such an application before the end of this period had there been grounds, but it did not do so: see Equuscorp at 701 per French, Kiefel and Sundberg JJ; Graywinter Management Pty Ltd v Deputy Commissioner of Taxation (1996) 22 ACSR 636 at 638 per Finn J; Shakespeares Pie Co Australia Pty Ltd v Multipye Pty Ltd [2005] NSWSC 1201 (" Shakespeare Pie ") at [7] per Barrett J; Australian Beverage Distributors Pty Ltd v Cranswick Premium Wines Pty Ltd [2004] NSWSC 877 (" Australian Beverage Distributors ") at [12] per Barrett J; and Livestock Traders at 54. Once the time for compliance has passed, however, the Court has no such power.


case_text: In the alternative, because of perceived difficulties with its application to extend time, G & J Gears sought leave to apply for an interlocutory injunction restraining Brobo from continuing with its winding up proceeding until the trial and determination of proceeding 1033. The evidence that it relied on in support of this application was the same evidence that it relied on in support of its application to set aside the statutory demand and, in particular, the Davis affidavit. G & J Gears contended that this affidavit constituted evidence of a deliberate attempt by Brobo, through its director, Milton, to interfere with the exclusive distributorship agreement between G & J Gears and Rockcrusher-USA; to take control of G & J Gears' intellectual property; and to put G & J Gears out of business and take G & J Gears' business for itself. This in turn showed, so counsel contended, that the statutory demand was an abuse of process of the kind discussed in Williams v Spautz [1992] HCA 34 ; (1992) 174 CLR 509 (" Spautz ") at 526-7. Counsel also relied on the fact that Milton had separated from Brobo, taking that part of Brobo's business that was relevant to these proceedings, and had established another company under the name "Rock Solid", being an adaptation of the logo used in G & J Gears' business. Counsel submitted that the authorities showed that an application for an injunction might be made in proceedings separate from winding up proceedings to restrain a winding up on the basis of a statutory demand that was bad in form or otherwise contestable although incapable of being set aside. Counsel further contended that the evidence raised a serious question to be tried and the balance of convenience favoured the grant of this interlocutory injunctive relief. 40 Finally, as already noted, G & J Gears sought an interlocutory injunction to restrain Rock Solid and Milton from using, without its authority, any of its intellectual property. In making this application, the company relied particularly on a 6 February 2006 affidavit of Shirley, as well as on the 24 February 2006 affidavit of Milton. Counsel submitted that the evidence taken as a whole supported the proposition that there was a serious question to be tried as to the respondents' continuing infringement of G & J Gears' intellectual property rights. According to counsel, the balance of convenience favoured the grant of an injunction because "the respondent is depriving effectively the applicant of the income from these products". Whilst counsel conceded that there was no evidence as to the financial position of any of the respondents, he submitted that it could reasonable be assumed that Rock Solid "has very little by the way of assets in the sense that it is a recently established company". He added that, if the Court were not minded to grant injunctive relief of the kind sought, G & J Gears sought an order that "there be a proper accounting by the second and third respondents of such sales and the proceeds of such sales". 41 Brobo contended that the Court had no power to extend the time for compliance with the statutory demand because the time for compliance had expired. G & J Gears was, so it said, deemed to be insolvent because it failed to comply with the demand within the time required, as extended by the registrar. The appeal from the registrar's decision was, so it submitted, nugatory. 63 First, Brobo's counsel submitted in reply that, whilst a court may have inherent jurisdiction or, in this court, implied incidental power to protect its own process against an abuse, this jurisdiction did not extend to protecting the process of another court. This may state the relevant proposition of law too broadly, although, for present purposes, I accept that the implied incidental power of this court to protect misuse of its process does not extend to protecting the process of the State's Supreme Court. That is a matter for the Supreme Court. See, generally, Sea Culture International Pty Ltd v Scoles (1991) 32 FCR 275 at 279, where French J referred to this court's "implied incidental power to control its own process and to prevent misuse of it"; also Hunter v Leahy [1999] FCA 1075 ; (1999) 91 FCR 214 at 219-220 per French J; Burton v President, &c., of the Shire of Bairnsdale [1908] HCA 57 ; (1908) 7 CLR 76 at 94-95 per Isaacs J; Walton v Gardiner [1992] HCA 12 ; (1993) 177 CLR 378 at 392-4; and Spautz at 519-520.


case_text: Section 459F(2) provides that, where application is made under s 459G to set aside a statutory demand, the "period for compliance with [the] statutory demand" is, if the Court "makes an order that extends the period for compliance with the demand", the period specified in the order of the Court (s 459F(2)(a)(i)) ; or "otherwise ... the period beginning on the day when the demand is served and ending 7 days after the application under s 459G is finally determined or otherwise disposed of [(s 459F(2)(a)(ii))]". The word "otherwise" in s 459F(2)(a)(ii) is a "laconic" expression of the condition that none of the conditions in s 459F(2)(a)(i) has been fulfilled: see Livestock Traders International Pty Ltd v Bui (1996) 22 ACSR 51 (" Livestock Traders ") at 53. Once one of these conditions in s 459F(2)(a) is fulfilled here, by the registrar's making of the order extending the time for compliance then s 459F(2)(a)(ii) can have no operation. Jenkinson J reached the same conclusion in Livestock Traders where, as in this case, a registrar of the Court dismissed an application to set aside a statutory demand and extended the time for compliance with the demand. There was no compliance with the demand within the extended time, although there was an application on foot to review the registrar's decision. His Honour held at 53, that "once an exercise of the power to extend the period for compliance has occurred no operation is left to subpara 459F(2)(a)(ii)" of the Corporations Law as it then was. This provision is identical to s 459F of the Corporations Act . His Honour said, also at 53, that "[t]he use of the word 'otherwise' in that subparagraph ... compels that conclusion". I agree. 48 Upon G & J Gears' application, the Court would have had power to extend time further at any time after the registrar made the order extending time until the expiry of that time. It would have been open to the company to have made such an application before the end of this period had there been grounds, but it did not do so: see Equuscorp at 701 per French, Kiefel and Sundberg JJ; Graywinter Management Pty Ltd v Deputy Commissioner of Taxation (1996) 22 ACSR 636 at 638 per Finn J; Shakespeares Pie Co Australia Pty Ltd v Multipye Pty Ltd [2005] NSWSC 1201 (" Shakespeare Pie ") at [7] per Barrett J; Australian Beverage Distributors Pty Ltd v Cranswick Premium Wines Pty Ltd [2004] NSWSC 877 (" Australian Beverage Distributors ") at [12] per Barrett J; and Livestock Traders at 54. Once the time for compliance has passed, however, the Court has no such power. 49 This limitation upon the power to extend time is implicit in the terms of ss 459F and 459C . Section 459F(1) operates to fix the time when a company on which a statutory demand has been served is taken to fail to comply with the demand. The significance of a failure to comply with a statutory demand is the subject of s 459C(2)(a) , which provides that the Court must presume that a company is insolvent if, during or after the 3 months ending on the day when the application is made, the company fails to comply with the statutory demand. The effect of ss 459F(1) and 459C (2)(a) is that the Court can only make an order under s 459F(2)(a)(i) extending the time for compliance prior to the end of the period for compliance, i.e., before the company is presumed to be insolvent. Within this period, an order extending the time can be made where a s 459G application has been rejected and that rejection is the subject of review or appeal. This is now well-settled: compare Vista Commercial Construction Pty Ltd v Deputy Commissioner of Taxation (1997) 25 ACSR 285 at 293 per Burchett, Hill and Emmett JJ; Graywinter Management Pty Ltd v Deputy Commissioner of Taxation (1996) 22 ACSR 636 at 638 per Finn J; Graywinter Properties Pty Ltd v Dyer (1997) 15 ACLC 302 at 306 per Ryan J; Buckland Products Pty Ltd v Deputy Commissioner of Taxation [2003] VSCA 85 (" Buckland Products ") at [8] per Phillips JA; Shakespeares Pie at [7] per Barrett J; and Australian Beverage Distributors at [5] per Barrett. As Jenkinson J said in Livestock Traders at 54, ss 459F and 459C (2)(a) of the Corporations Law "premise unalterability of the time as at which a company is to be taken to have failed to comply with a statutory demand once the period for compliance has ended at a time when the demand is still in effect". This is equally true of the equivalent sections of the Corporations Act . The power to extend time after the end of the period for compliance would introduce a degree of uncertainty incompatible with the statutory regime: see also Buckland Products at [8] per Phillips JA. 52 Once G & J Gears is taken to have failed to comply with the statutory demand and to be insolvent, the application to set the demand aside is fruitless and the application to review the registrar's decision, nugatory: compare Livestock Traders at 55. As Phillips JA said in Buckland Products at [9]: "If the company was wishing to appeal it could do so, but unless the appeal was heard and determined before the expiry of the period for compliance otherwise fixed, an extension of the time for compliance had to be obtained. Without it, there could be no point in the continued prosecution of the appeal, for, the period of compliance having ended before the appeal was heard and determined, the consequence prescribed by s.459F(1) attached, with all that followed under the statute." 53 It follows from what I have said that, strictly speaking, it is unnecessary to consider whether an application under s 459G is "finally determined or otherwise disposed of" by the registrar's determination that the application should be dismissed. I would observe, however, that there was nothing put in argument that would lead me to differ from Jenkinson J, who said in Livestock Traders at 53, that he was "inclined to think that 'the application is finally determined' when an order determining the application is made, notwithstanding that the order is, if made by a registrar, reviewable, and that the order is, if made by the court, subject to appeal." See also Buckland Products at [5]-[9] per Phillips JA. 54 In view of this conclusion, it is also strictly unnecessary to consider whether there was any error in the registrar's decision. But as this was the subject of extensive argument, I set out my views briefly.


case_text: Upon G & J Gears' application, the Court would have had power to extend time further at any time after the registrar made the order extending time until the expiry of that time. It would have been open to the company to have made such an application before the end of this period had there been grounds, but it did not do so: see Equuscorp at 701 per French, Kiefel and Sundberg JJ; Graywinter Management Pty Ltd v Deputy Commissioner of Taxation (1996) 22 ACSR 636 at 638 per Finn J; Shakespeares Pie Co Australia Pty Ltd v Multipye Pty Ltd [2005] NSWSC 1201 (" Shakespeare Pie ") at [7] per Barrett J; Australian Beverage Distributors Pty Ltd v Cranswick Premium Wines Pty Ltd [2004] NSWSC 877 (" Australian Beverage Distributors ") at [12] per Barrett J; and Livestock Traders at 54. Once the time for compliance has passed, however, the Court has no such power. 49 This limitation upon the power to extend time is implicit in the terms of ss 459F and 459C . Section 459F(1) operates to fix the time when a company on which a statutory demand has been served is taken to fail to comply with the demand. The significance of a failure to comply with a statutory demand is the subject of s 459C(2)(a) , which provides that the Court must presume that a company is insolvent if, during or after the 3 months ending on the day when the application is made, the company fails to comply with the statutory demand. The effect of ss 459F(1) and 459C (2)(a) is that the Court can only make an order under s 459F(2)(a)(i) extending the time for compliance prior to the end of the period for compliance, i.e., before the company is presumed to be insolvent. Within this period, an order extending the time can be made where a s 459G application has been rejected and that rejection is the subject of review or appeal. This is now well-settled: compare Vista Commercial Construction Pty Ltd v Deputy Commissioner of Taxation (1997) 25 ACSR 285 at 293 per Burchett, Hill and Emmett JJ; Graywinter Management Pty Ltd v Deputy Commissioner of Taxation (1996) 22 ACSR 636 at 638 per Finn J; Graywinter Properties Pty Ltd v Dyer (1997) 15 ACLC 302 at 306 per Ryan J; Buckland Products Pty Ltd v Deputy Commissioner of Taxation [2003] VSCA 85 (" Buckland Products ") at [8] per Phillips JA; Shakespeares Pie at [7] per Barrett J; and Australian Beverage Distributors at [5] per Barrett. As Jenkinson J said in Livestock Traders at 54, ss 459F and 459C (2)(a) of the Corporations Law "premise unalterability of the time as at which a company is to be taken to have failed to comply with a statutory demand once the period for compliance has ended at a time when the demand is still in effect". This is equally true of the equivalent sections of the Corporations Act . The power to extend time after the end of the period for compliance would introduce a degree of uncertainty incompatible with the statutory regime: see also Buckland Products at [8] per Phillips JA.


case_title: Shakespeares Pie Co Australia Pty Ltd v Multipye Pty Ltd [2005] NSWSC 1201


case_title: Australian Beverage Distributors Pty Ltd v Cranswick Premium Wines Pty Ltd [2004] NSWSC 877


case_text: This limitation upon the power to extend time is implicit in the terms of ss 459F and 459C . Section 459F(1) operates to fix the time when a company on which a statutory demand has been served is taken to fail to comply with the demand. The significance of a failure to comply with a statutory demand is the subject of s 459C(2)(a) , which provides that the Court must presume that a company is insolvent if, during or after the 3 months ending on the day when the application is made, the company fails to comply with the statutory demand. The effect of ss 459F(1) and 459C (2)(a) is that the Court can only make an order under s 459F(2)(a)(i) extending the time for compliance prior to the end of the period for compliance, i.e., before the company is presumed to be insolvent. Within this period, an order extending the time can be made where a s 459G application has been rejected and that rejection is the subject of review or appeal. This is now well-settled: compare Vista Commercial Construction Pty Ltd v Deputy Commissioner of Taxation (1997) 25 ACSR 285 at 293 per Burchett, Hill and Emmett JJ; Graywinter Management Pty Ltd v Deputy Commissioner of Taxation (1996) 22 ACSR 636 at 638 per Finn J; Graywinter Properties Pty Ltd v Dyer (1997) 15 ACLC 302 at 306 per Ryan J; Buckland Products Pty Ltd v Deputy Commissioner of Taxation [2003] VSCA 85 (" Buckland Products ") at [8] per Phillips JA; Shakespeares Pie at [7] per Barrett J; and Australian Beverage Distributors at [5] per Barrett. As Jenkinson J said in Livestock Traders at 54, ss 459F and 459C (2)(a) of the Corporations Law "premise unalterability of the time as at which a company is to be taken to have failed to comply with a statutory demand once the period for compliance has ended at a time when the demand is still in effect". This is equally true of the equivalent sections of the Corporations Act . The power to extend time after the end of the period for compliance would introduce a degree of uncertainty incompatible with the statutory regime: see also Buckland Products at [8] per Phillips JA.


case_title: Graywinter Properties Pty Ltd v Dyer (1997) 15 ACLC 302


case_text: A review of a registrar's decision under s 35A of the Federal Court of Australia Act 1976 (Cth) is by way of a hearing de novo in the sense that it is a hearing at which the parties may adduce fresh evidence as of right: see Mazukov v University of Tasmania [2004] FCAFC 159 at [24] per Kiefel, Weinberg and Stone JJ and Cottrell v Wilcox [2001] FCA 866 at [8] per Sundberg, Emmett and Finkelstein JJ. Absent any limitation deriving from another source, G & J Gears is entitled to adduce additional evidence on review of the registrar's decision. Apart from the more fundamental objection to the review discussed above, this was not, however, the only difficulty that it faced with respect to the evidence that it wished to adduce on the review. There was a further limitation consequential upon s 459G. That is, the authorities establish that the recipient of a statutory demand cannot apply to have the demand set aside on a ground not raised within the 21 days allowed in s 459G: see Energy Equity Corporation Ltd v Sinedie Pty Ltd [2001] WASCA 419 at [29] per Wallwork J, with whom Steytler J and Olsson AUJ agreed. Under the regime established by the Corporations Act , the Court has no discretion to extend time: compare David Grant & Co Pty Ltd v Westpac Banking Corporation [1995] HCA 43 ; (1995) 184 CLR 265 (" David Grant ") at 277-278 per Gummow J. Brisbane South Regional Health Authority v Taylor [1996] HCA 25 ; (1996) 186 CLR 541, which was relied on by G & J Gears, is not authority to the contrary since it concerned a relevantly different statutory scheme that expressly conferred discretion to enlarge time. Thus, even if a further extension of time had been obtained, it would not have been open to G & J Gears to rely on any claim other than its trademark infringement claim. Providing its initial affidavit satisfied s 459G(3) , it would have been open to G & J Gears to rely on evidence additional to that filed within the 21 day period to support this ground, being a ground that was raised within this period: see Graywinter Properties Pty Ltd v Gas & Fuel Corporation Superannuation Fund (1996) 14 ACLC 1703 at 1709 per Sundberg J, applied in Meadowfield Pty Ltd v Gold Coast Holdings Pty Ltd (in liq) [2001] WASCA 360.


case_title: Cottrell v Wilcox [2001] FCA 866


case_title: Energy Equity Corporation Ltd v Sinedie Pty Ltd [2001] WASCA 419


case_title: David Grant & Co Pty Ltd v Westpac Banking Corporation [1995] HCA 43 ; (1995) 184 CLR 265


case_title: Brisbane South Regional Health Authority v Taylor [1996] HCA 25 ; (1996) 186 CLR 541


case_title: Graywinter Properties Pty Ltd v Gas & Fuel Corporation Superannuation Fund (1996) 14 ACLC 1703


case_title: Meadowfield Pty Ltd v Gold Coast Holdings Pty Ltd (in liq) [2001] WASCA 360


case_text: The trademark infringement claim did not, however, disclose an offsetting claim. Sections 459H and 459J of the Corporations Act set out the grounds on which a statutory demand may be set aside. G & J Gears relied on s 459H(1)(b). The expression "offsetting claim" is defined in s 459H(5). It has been said that a "genuine" claim requires that (1) the claim "be bona fide and truly exist in fact"; and (2) the grounds for alleging its existence are "real and not spurious, hypothetical, illusory or misconceived": see Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 542 at 464 per Northrop, Merkel and Goldberg JJ. Only a claim that can be quantified in money can constitute an "offsetting claim": see Chase Manhattan Bank Australia Ltd v Oscty Pty Ltd (1995) 17 ACSR 128 at 135 per Lindgren J. In Intag Microelectronics Pty Ltd v AWA Ltd (1995) 18 ACSR 284 at 289, Young J said, "[t]he claim must be one which the court can see, without looking too deeply at the issues that may arise, has some real chances of success." The trademark infringement claim made by G & J Gears does not meet this threshold.


case_title: Chase Manhattan Ltd v Oscty Pty Ltd (1995) 17 ACSR 128


case_title: Intag Microelectronics Pty Ltd v AWA Ltd (1995) 18 ACSR 284


case_text: I would also dismiss the application by G & J Gears for an interlocutory injunction to restrain the use of intellectual property rights. As indicated above, on the evidence now before the Court, there is no serious question to be tried with respect to the alleged infringement of the Little Rock mark. Furthermore, I accept the respondents' contention that G & J Gears has not demonstrated to the requisite degree that it has any lawful entitlement to the "Rockcrusher" logo or, indeed, any intellectual property rights in the designs, patterns and tooling (for the greater part of which it seems that G & J Gears have not paid). It suffices to refer to the matters on which counsel for Brobo relied in this regard. As the evidence currently stands, the assignment of relevant rights from R-Diffs to G & J Gears would appear to be ineffective because R-Diffs' receiver did not give his consent: see, e.g., Deangrove Pty Ltd v Commonwealth Bank of Australia [2001] FCA 173 ; (2001) 37 ACSR 465 at 471-2 per Sackville J. 60 Further, I am not satisfied that G & J Gears has established that there is a serious question to be tried with respect to any other matter that would support the grant of the interlocutory relief it seeks. Although the threshold is low and the account given by Davis, if accepted, is indicative of an attempt by Milton to induce Davis and Boydston to depart from an alleged agreement or arrangement with G & J Gears, the rest is little more than speculation at this stage. G & J Gears conceded that it is indebted to Brobo in the amount that supports the statutory demand by virtue of the registrar's order. It is not suggested that Brobo desires other than to achieve the company's winding up in the winding up proceedings. Moreover, it must be borne in mind that Davis' account is denied by Milton (who says that he was not in the US at the relevant time) and Boydston. There was no evidence that the alleged plan was given effect. For example, there was no evidence that the statutory demand, which was served months after the alleged conversations, was intended to give effect to anything allegedly discussed in these conversations. Indeed, there was no evidence that the alleged plan met with any agreement (with Boydston or otherwise) and that Milton set out to implement it. Counsel for G & J Gears asked the Court to infer that the demand was part of Milton's alleged stratagem to put it out of business. I would not draw this inference on the evidence presently before me. 61 Even if there were a serious question to be tried, I would not grant the relief sought. First, in a case such as this, as counsel for G & J Gears virtually conceded, damages would be an appropriate remedy. Secondly, on the evidence before the Court, particularly as set out in the 24 February 2006 affidavit of Milton and the affidavit of Witt, it seems unlikely that G & J Gears or the natural persons behind it would be in a position to satisfy any order for damages for breach of any undertaking given to the Court. There is also Boydston's evidence that his company or companies would suffer permanent injury if an injunction in the terms sought were granted. And there is also the fact that, as the respondents submitted, there has been an apparent lack of candour on the issue of entitlement to the "Rockcrusher" logo. I accept that, as the respondents submitted, the evidence for G & J Gears created an impression that it was its application on 11 March 2005 that was still pending whereas this was not the case. There is no basis shown for the making of any alternative order of the kind sought by counsel for G & J Gears.


case_text: Finally, I would not grant G & J Gears leave to amend the motion to seek injunctive relief restraining the winding up proceeding. Counsel for G & J Gears referred to decisions concerning applications for injunctive relief in winding up proceedings, as for example, Perpetual Plantations of Australia Ltd v United Tree Farmers Ltd (1993) 10 ACSR 82 (" Perpetual Plantations ") and Shanefield Pty Ltd v McLaren [1999] QSC 366. As these authorities recognize, a court, on a winding up application, may refuse a winding up order where the alleged ground for winding up is deemed insolvency and the court is satisfied that the debt is genuinely disputed as relevantly defined. Any such statement is subject to the Corporations Act , including s 459S. 65 Finally, Brobo's counsel submitted, and I accept, that if a litigant commences separate proceedings to restrain a winding up ( ex hypothesi , in the same court as the winding up proceeding) there will always be a question as to whether the litigant should have presented its defence to the winding up in the winding up proceeding itself: see Perpetual Plantations at 85-6 per Burley J; also David Grant at 279; and Marlan Financial Services Pty Ltd v New England Agricultural Traders Pty Ltd [1999] VSC 435 per Byrne J. According to Brobo, there were numerous matters that indicated that G & J Gears should present its defence case in the winding up, including that the Davis affidavit was in non-specific terms and did not show that the purpose of the statutory demand was other than to achieve a winding up (see the discussion at [60] above). I accept Brobo's submission. It would appear likely that G & J Gears will have an opportunity, at the hearing of the winding up petition, to rely on the matters in opposition to the winding up that it could not put forward on its application to set aside the statutory demand. These matters would not appear to fall within the prohibition in s 459S of the Corporations Act .


case_text: Finally, I would not grant G & J Gears leave to amend the motion to seek injunctive relief restraining the winding up proceeding. Counsel for G & J Gears referred to decisions concerning applications for injunctive relief in winding up proceedings, as for example, Perpetual Plantations of Australia Ltd v United Tree Farmers Ltd (1993) 10 ACSR 82 (" Perpetual Plantations ") and Shanefield Pty Ltd v McLaren [1999] QSC 366. As these authorities recognize, a court, on a winding up application, may refuse a winding up order where the alleged ground for winding up is deemed insolvency and the court is satisfied that the debt is genuinely disputed as relevantly defined. Any such statement is subject to the Corporations Act , including s 459S.


case_text: First, Brobo's counsel submitted in reply that, whilst a court may have inherent jurisdiction or, in this court, implied incidental power to protect its own process against an abuse, this jurisdiction did not extend to protecting the process of another court. This may state the relevant proposition of law too broadly, although, for present purposes, I accept that the implied incidental power of this court to protect misuse of its process does not extend to protecting the process of the State's Supreme Court. That is a matter for the Supreme Court. See, generally, Sea Culture International Pty Ltd v Scoles (1991) 32 FCR 275 at 279, where French J referred to this court's "implied incidental power to control its own process and to prevent misuse of it"; also Hunter v Leahy [1999] FCA 1075 ; (1999) 91 FCR 214 at 219-220 per French J; Burton v President, &c., of the Shire of Bairnsdale [1908] HCA 57 ; (1908) 7 CLR 76 at 94-95 per Isaacs J; Walton v Gardiner [1992] HCA 12 ; (1993) 177 CLR 378 at 392-4; and Spautz at 519-520.