case_text: number of things may be said against this submission. The Board, despite the infelicity in the double negative, did ultimately express itself in the language of s 251K(2)(b) ; the Board is an administrative body whose decisions are to be construed in a practical and robust fashion and not with an eye attuned to the detection of error: Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259 at 272 per Brennan CJ, Toohey, McHugh and Gummow JJ. So read, the double negative involved in the Board's statement should be understood as if it were a positive statement. Mr Wright SC, who appeared with Ms Hirschhorn for the Board, put it neatly by suggesting that the language simply showed that the Board was keeping an open mind on the matter. There is force in each of these points but ultimately I cannot escape the conclusion that the Board did regard itself as entitled to suspend CAP if it failed to satisfy the Board that it had not misappropriated the cheque. I accept, of course, that notions such as the burden of proof have a limited role to play in administrative decision-making but that, I think, only highlights how the Board has not actually discharged its function correctly. For the power to be enlivened the Board had to be satisfied that there had been one of the events referred to in s 251K(2)(b). In the critical part of its reasons as opposed to the statement of its conclusions it does not appear to have been so satisfied. There was an error of law.


case_outcome: cited

case_text: applicants submitted that the view that s 251G did not prescribe a topic which permitted the production of information was supported by three authorities: Smorgon v Australia and New Zealand Banking Group Ltd [1976] HCA 53 ; (1976) 134 CLR 475 ; Fieldhouse v Commissioner of Taxation (1989) 25 FCR 187 ; O'Reilly v Commissioners of State Bank of Victoria (1983) 153 CLR 1.


case_outcome: considered

case_text: accepting that to be so does not assist CAP. I would not regard that principle of interpretation as preventing such an administrative power of suspension from being used on an interim basis or in a preliminary or provisional way. Where a determination is expressed to be preliminary or interim the principle upon which the submission proceeds does not apply. In such a case, there has been no 'final' determination. In Kabourakis Nettle JA, at [50], set forth a passage from the reasons for judgement of Vaisey J in Re 56 Denton Road Twickenham [1953] 1 Ch 51 at 56-57 which was in these terms: ... where Parliament confers upon a body such as the War Damage Commission the duty of deciding or determining any question, the deciding or determining of which affects the rights of the subject, such decision or determination made and communicated in terms which are not expressly preliminary or provisional is final and conclusive, and cannot in the absence of express statutory power or the consent of the person or persons affect be altered or withdrawn by that body. (Emphasis added.)


case_text: applicants submitted that the view that s 251G did not prescribe a topic which permitted the production of information was supported by three authorities: Smorgon v Australia and New Zealand Banking Group Ltd [1976] HCA 53 ; (1976) 134 CLR 475 ; Fieldhouse v Commissioner of Taxation (1989) 25 FCR 187 ; O'Reilly v Commissioners of State Bank of Victoria (1983) 153 CLR 1. The notice was addressed to Armstrong Scalisi Holdings Pty Ltd. The applicants contended that a notice could not be addressed to a corporation but only to its proper officer. In truth, there were two submissions here; one, a submission that a notice could not be served upon a corporation; the other, that if it was, it had to be addressed to the corporation's proper officer. These arguments are, so it seems to me, quite without substance. It has been accepted that a corporation cannot be required physically to attend and give evidence for the very good reason that it is an abstraction lacking physical form: Smorgon v Australian and New Zealand Banking Group [1976] HCA 53 ; (1976) 134 CLR 475 at 481-482 per Stephen J. However, that physical constraint has no impact on the ability of a corporation to answer questions. It is for that reason well established that a corporation may be required to provide information. Indeed, Lockhart J described the contrary argument as "fallacious" in Fieldhouse v Commissioner of Taxation (1989) 25 FCR 187 at 198, an observation with which I respectfully agree. Burchett and Hill JJ also rejected the argument (at 203 and 218 respectively). The power in reg 168(2) is subject to a limitation in the case of subparagraph (a) that the information sought relates to "an application or other matter before the Board" and, in the case of subparagraph (b) that "in the opinion of the Board" it so relates. It is common ground that the notice does not recite the matter which is before the Board or any opinion by the Board about such a matter. The applicants cited Smorgon as authority for the proposition that a failure to specify the matter meant the notice was invalid. Reliance upon Smorgon is, I think, misplaced. In that case Stephen J did uphold the challenge to the validity of a subparagraph of a notice issued under s 264 which sought "all other books, papers, writings and other documents concerning the said matters which are in your custody" (at 490). The "matters" were not defined in the notice but it was shown that they were the assessments of the incomes of various taxpayers. The recipient of the notice was a bank. The language of "matters" was drawn directly from the words of the latter part of s 264. Stephen J said (at 491): It follows that I would not regard a notice which did no more, by way of requiring production of documents, than to repeat the words of the latter part of s 246(1)(b) as an effective exercise of the Commissioner's power. These words describe the ambit of that power but do not provide a suitable formula for insertion in a notice. Such notice, given in exercise of the power, must instead specify with some degree of particularity, as do pars (i) to (vii) of the notice to the Bank, what documents are being sought. Failing this there will be no valid requirement. I do not think that this passage provides support for an argument that a notice must specify the relevant matter. To the contrary, it cautions against careless recitation of language of the provision. Severance


case_text: then that the Court has jurisdiction to entertain the contempt argument against the Board, what are the relevant principles? Five propositions should, I think, be accepted. First , the existence of a parallel administrative inquiry is capable of constituting a contempt of criminal proceedings: McGuinness v Attorney-General (Vic) [1940] HCA 6 ; (1940) 63 CLR 73 at 85; Victoria v Australian Building Constructions Employees' and Builders Labourers' Federation [1982] HCA 31 ; (1982) 152 CLR 25 ("BLF") at 54 and 72; Hammond v Commonwealth [1982] HCA 42 ; (1982) 152 CLR 188 at 206. Secondly, whether it does so depends upon whether there is a real risk that the pursuit of the administrative investigation will prejudice, undermine or interfere with the conduct of those criminal proceedings: Attorney-General v Times Newspapers Ltd [1974] AC 273 at 299; BLF at 96. Thirdly , where the person facing prosecution is required to answer questions by such an inquiry this risk is particularly acute because of the capacity of such questions to undermine the accused person's right against self-incrimination. Fourthly , that risk will also be more pronounced where the identity of the prosecutor and the investigating body are the same or where they are connected in some way: Hammond at 207. Fifthly, a risk may well be shown where a person other than the accused is to be examined by the administrative inquiry: Watson v Commissioner of Taxation [1999] FCA 1796 ; (1999) 96 FCR 48 at 59-60 [54] - [56] .


case_text: are a number of instances, of course, where this Court and the High Court in its original jurisdiction have assumed a jurisdiction in relation to criminal proceedings then pending before a State court: Hammond v Commonwealth [1982] HCA 42 ; (1982) 152 CLR 188 ; Commissioner of Taxation v De Vonk (1995) 61 FCR 564 ; Watson v Commissioner of Taxation [1999] FCA 1796 ; (1999) 96 FCR 48. However, in each of those cases the proceedings pending in the State court involved the alleged commission of a crime against a law of the Commonwealth. In Hammond, Mr Hammond had been charged with conspiracy in relation to the substitution of kangaroo meat for beef in the export market, apparently an offence against s 86(1)(a) of the Crimes Act 1914 (Cth). Not only that, but the prosecuting body was the Commonwealth as were, effectively, the commissioners conducting the Royal Commission. In De Vonk , the applicant was charged with conspiring to defraud the Commonwealth as was Mr Watson in Watson . In each case, the question of whether a contempt was being committed was part of a matter arising under a law made by the Parliament or in which the Commonwealth was a party. Federal jurisdiction was, therefore, clear. Granted then that the Court has jurisdiction to entertain the contempt argument against the Board, what are the relevant principles? Five propositions should, I think, be accepted. First , the existence of a parallel administrative inquiry is capable of constituting a contempt of criminal proceedings: McGuinness v Attorney-General (Vic) [1940] HCA 6 ; (1940) 63 CLR 73 at 85; Victoria v Australian Building Constructions Employees' and Builders Labourers' Federation [1982] HCA 31 ; (1982) 152 CLR 25 ("BLF") at 54 and 72; Hammond v Commonwealth [1982] HCA 42 ; (1982) 152 CLR 188 at 206. Secondly, whether it does so depends upon whether there is a real risk that the pursuit of the administrative investigation will prejudice, undermine or interfere with the conduct of those criminal proceedings: Attorney-General v Times Newspapers Ltd [1974] AC 273 at 299; BLF at 96. Thirdly , where the person facing prosecution is required to answer questions by such an inquiry this risk is particularly acute because of the capacity of such questions to undermine the accused person's right against self-incrimination. Fourthly , that risk will also be more pronounced where the identity of the prosecutor and the investigating body are the same or where they are connected in some way: Hammond at 207. Fifthly, a risk may well be shown where a person other than the accused is to be examined by the administrative inquiry: Watson v Commissioner of Taxation [1999] FCA 1796 ; (1999) 96 FCR 48 at 59-60 [54] - [56] .


case_outcome: applied

case_text: It is common ground that Bective Station did not make full payment under its first contract to purchase wheat from AWBA until a date which the evidence does not fix precisely but which was shortly after 19 August 2003. It was on 19 August 2003 that AWB Limited (presumably acting on behalf of AWBA) issued a statement of liquidated claim against Bective Station in the District Court of New South Wales. Clause 12 of the Standard Terms authorised AWBA to withhold delivery under the Second Contract until all overdue payments were made under the first contract. AWBA was thus entitled to withhold delivery throughout March 2003 and, indeed, until at least late August 2003. Bective Station did not thereafter request delivery of wheat or purport to terminate the Second Contract for breach because of AWBA's failure to deliver wheat under the Second Contract. Clause 15 of the Standard Terms, which provided that stipulations as to time were of the essence, did not operate to bring the contract to an end; assuming clause 15 to have not earlier ceased to operate because of Bective Station's overdue payments, it authorised an innocent party to elect to terminate the contract ( Carr v J A Berriman Pty Ltd [1953] HCA 31 ; (1953) 89 CLR 327 per Fullagar J at 348). 19 The contentions of Bective Station that the Second Contract was terminated in March 2003 by reason of non-delivery of the wheat as required by the Second Contract, or alternatively on or before 31 August 2003 by effluxion of time, therefore fail. 20 Bective Station's further alternative contention that the Second Contract was terminated on 20 October 2003, or five days thereafter, is founded on AWB Limited's letter dated 20 October 2003. Omitting formal matters that letter was in the following terms: 'The purpose of this correspondence is to formerly [sic] notify Bective Station Pty Ltd of their default in relation to taking delivery of AWB sales contract 2301055 (AWB reference) dated 6 th November 2002. The expiration date of the contract was 30 th August 2003. Under the terms and conditions of the contract AWB has the right, at AWB's discretion, to resell the quantity of grain in default at fair market value. Bective Station Pty Ltd, as the party in default, is liable for the loss incurred by AWB as a result of reselling the grain at a reduced price. If AWB does not receive direction from Bective Station Pty Ltd within 5 business days of receiving this letter, AWB in accordance with the terms and conditions of the contract will washout Bective Station. AWB have obtained third party independent advice quoting fair market value for wheat delivered into a buyers nominated store in the Liverpool Plains region. Should you accept a washout AWB will apply market value as at the end of the contract the price being $215/MT, if not AWB will apply spot market price to determine fair value, indication as at 20/08/03 of $200/MT. A washout cost per metric tonne is based off the contract (2301055) price for August of $395.50 less fair market value, the net cost of the washout is on 7000MT and is due 30 days end of week. AWB will issue a tax invoice within 5 business days. For your information the cost of a washout basis the October price is $1,368,500. Should you wish to formerly [sic] accept washout of the contract as at the end of August please contact me directly on [telephone number given] .'


case_text: The nature of tendency evidence was considered in Jacara Pty Ltd v Perpetual Trustees WA Ltd [2000] FCA 1886 ; (2000) 106 FCR 51 by Sackville J, with whom Whitlam and Mansfield JJ agreed. In that case the appellant alleged that the respondent's agent had made misrepresentations which induced the appellant to lease certain premises in a shopping centre. The appellant sought to adduce evidence that the agent had made similar representations to other prospective tenants of the shopping centre. Sackville J accepted that the admissibility of the evidence sought to be adduced was to be determined by reference to s 97 as evidence that the agent had a tendency to act in a particular way. 81 In my view the affidavit evidence of Messrs Rowland, Setter and Gillogly referred to above is not relevantly distinguishable from the kind of evidence sought to be adduced in Jacara Pty Ltd v Perpetual Trustees WA Ltd . It is therefore to be regarded as tendency evidence falling within s 97. I note incidentally that in each case the evidence may, in any event, have been admissible in reply because of the evidence of Mr Adams that, in effect, he would never have said anything to the effect that 'there will be no wheat in Australia from March 2003 until the harvest begins in October '. The application on which I was invited to rule, however, was an application to adduce the evidence pursuant to s 97(1). 82 For the evidence of Messrs Rowland, Setter and Gillogly to be admissible under s 97(1) it was necessary for the requirements of both paragraphs (a) and (b) of the subsection to be satisfied. As mentioned above, Bective Station had given the notice required by paragraph (a). 83 In determining that their evidence had significant probative value I took into account that: (a) each of them gave evidence of a conversation with Mr Adams which took place within a few days of the conversation between Mr Vickery and Mr Adams; (b) each of them gave evidence of Mr Adams using language similar to the language which Mr Vickery claimed that Mr Adams had used in conversation with him; (c) each of them gave evidence of Mr Adams saying words to the effect that the supply of wheat could or would run out; and (d) Mr Adams' affidavit evidence was that he definitely did not say words to the effect that 'there will be no wheat in Australia from March 2003 until the harvest begins in October' as such a statement was, in his opinion, ridiculous because he could not conceive of any circumstances where the supply of wheat in Australia would ever run out.


case_text: A claim for damages for breach of contract must ordinarily be brought within six years from the date on which the cause of action accrued ( Limitation of Actions Act 1958 (Vic) s 5 ; Limitation Act 1969 (NSW) s 14). However, the parties to the contract may agree a shorter limitation period ( Port Jackson Stevedoring Proprietary Limited v Salmond & Spraggon (Australia) Proprietary Limited [1978] HCA 8 ; (1978) 139 CLR 231 per Barwick CJ at 239-9). 36 The parties are in agreement that the time within which AWBA was obliged to institute a proceeding to recover damages from Bective Station for breach of the Second Contract is governed by the Second Contract, and in particular by the Standard Terms. However, there is a dispute between the parties as to the proper construction of the Standard Terms in this regard. 37 Bective Station placed reliance on clause 9 of the Standard Terms and argued that as the cross-claim was not filed within 12 months of the termination of the Second Contract it is time barred. The cross-claim was filed on 24 March 2005.


case_outcome: referred to

case_text: In Sunbird Plaza Gaudron J at 273 said: '... there is no loss of bargain whilst the contract remains on foot. It is for this reason that a vendor must bring his contractual obligation to sell to an end before he can maintain an action for damages for loss of bargain' . (citations omitted) See also Ronnoc Finance v Spectrum Network Systems Ltd (1997) 45 NSWLR 624.


case_text: As Mason CJ, with whom Deane, Dawson and Toohey JJ agreed, observed in Sunbird Plaza Pty Ltd v Maloney [1988] HCA 11 ; (1988) 166 CLR 245 at 260-261: 'Loss of bargain damages are recoverable only if the contract is at an end. Once termination due to the defendant's wrongful conduct is established the plaintiff is entitled to damages for loss of bargain ... Barwick C.J. suggested in Ogle [ Ogle v Comboyuro Investments Pty Ltd [1976] HCA 21 ; (1976) 136 CLR 444 at 450], that termination is not an essential element in an action for loss of bargain damages, except in the case of anticipatory breach, but the preponderant opinion in Australia and England is against his view' . (citations omitted) 33 In Sunbird Plaza Gaudron J at 273 said: '... there is no loss of bargain whilst the contract remains on foot. It is for this reason that a vendor must bring his contractual obligation to sell to an end before he can maintain an action for damages for loss of bargain' . (citations omitted) See also Ronnoc Finance v Spectrum Network Systems Ltd (1997) 45 NSWLR 624.


case_text: The aspect of the matter which has caused me concern is that a period of months is a substantial stretch of the statutory provisions. I know it has been done in other cases. Some of those cases for example, Fincorp Group Holdings Pty Limited [2007] NSWSC 363 bear at least some resemblance to the present case, both because of the nature of the corporations and because of the closeness in time to the present collapse. Having considered the evidence in this case, I think that it is too early to commit to such a lengthy period before the creditors have any real say in the matter. 4 A course which is taken in some of these matters and was, I notice, taken in Fincorp [2007] NSWSC 363 , is to provide for a lengthy period but also, by an order under s 447A , permit foreshortening of the period if events warrant it. Other courses which can be taken are, if a case is made out, to utilise s 447A to extend the period for which the creditors can adjourn the meeting pursuant to s 439B or to utilise s 447A to grant a further extension of the convening period under s 439A. The latter course has been taken in a number of matters. It seems to me that would be the appropriate course to be taken in these matters if necessary. 5 I take into account, amongst other factors, the opposition of at least one secured creditor in the Estate Property Group case, albeit a creditor who has not filed evidence and is not present. I take into account the short notice of this application to creditors generally and to the Australian Securities and Investment Commission. I also have in mind the link between the two cases and the fact that the applications are also linked with an extension of the decision period pursuant to s 441A in relation to the rights of Australian Capital Reserve Limited. On the other hand, I take into account the fact that I should not be building up costs or causing too much diversion of effort by the administrators in making successive applications to the Court instead of getting on with their job. I think there is sufficient flexibility built into these matters if I commit to the use of s 447A to fix a further extension of the convening period if appropriate. I will ensure that there is an adequate extension of the convening period after the date to which the matters will be adjourned so that, even if I am not persuaded there should be a further extension, there will be a practical way of coping with the situation. 6 In each of these matters, namely, Estate Property Group Limited, NSD 1079 of 2007 and Australian Capital Reserve Limited, NSD 1085 of 2007, I make orders respectively in accordance with the short minutes of order which I have initialled and placed with the papers in each matter. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles. Associate: Dated: 20 June 2007 Counsel for the Plaintiffs in NSD 1079 of 2007: Mr CRC Newlinds SC, Mr G Lucarelli Solicitor for the Plaintiffs in NSD 1079 of 2007: Minter Ellison Counsel for South Canterbury Finance Limited, Australian Executors Trustees (SA) Limited, GP Mortgage Corporation Limited in NSD 1079 of 2007: Mr AJ McInerney Solicitors for South Canterbury Finance Limited, Australian Executors Trustees (SA) Limited, GP Mortgage Corporation Limited in NSD 1079 of 2007: Gray & Perkins Counsel for the Plaintiffs in NSD 1085 of 2007: Mr JC Sheahan SC Solicitor for the Plaintiffs in NSD 1085 of 2007: Baker & McKenzie Date of Hearing: 15 June 2007 Date of Judgment: 15 June 2007 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/935.html


case_text: Further, A promise by an inquisitor to give material to a party affected can be highly relevant to whether procedural fairness has been denied, notwithstanding the overall merits of the case: Applicant NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] HCA 62 ; (2004) 221 CLR 1. 59 It should be noted that the Act has, since the hearing of this case, been amended so that the exception within the definition of injury extends to "reasonable administrative action". This exception is broader and more clearly defined: see s 5A of the Act. These amendments came into force on 13 April 2007, and address many of the issues of principle which were raised as primary issues of concern to the applicant during the hearing. However, these amendments have no effect on the present decision. 60 For these reasons the appeal will be dismissed with costs. I certify that the preceding sixty (60) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick. Associate: Dated: 1 April 2008 Counsel for the Applicant: Ms S Maharaj QC Solicitor for the Applicant: DLA Phillips Fox Counsel for the Respondent: Mr W L Sharwood Solicitor for the Respondent: Pamela Coward & Associates Date of Hearing: 23 April 2007 Date of Judgment: 1 April 2008 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/422.html


case_text: The foundation of the Senior Member's view that the action, now held to be disciplinary, was not "reasonable" rested entirely upon an opinion that the inquisitor had not accorded Ms Eames procedural fairness in circumstances where there was plainly a duty to afford it. At least in such circumstances, whether procedural fairness was given is to be categorised as a question of law, even though it obviously depends on factual findings. In Clements 131 FCR at [6]-[8] the Full Court held that whether the Tribunal itself denied procedural fairness is a question of law and, with respect, this must be so. In general, questions of law are those which are inescapably for a judge to decide. In many instances, these actually involve inquiry into and assessment of factual matters by the judge. Judgments on the admissibility of evidence are often examples of this. Whether procedural fairness has been given is such a question because, if procedural fairness has not been given, the administrative action in question (and not just disciplinary action) is affected by jurisdictional error: eg Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597. Whether there has been a jurisdictional error is, ex hypothesi, a question of law.


case_text: This implies another consideration: Cooper J in Chenhall [1992] FCA 535 ; 37 FCR 75 indicated (rightly, in my respectful view) that, among other things, to be "disciplinary action" in terms of the statute, the action needed to be "lawfully" taken. If procedural fairness be denied, the action will not be lawful, whether or not some circumstances may exist (about which I say nothing) in which the action might nevertheless be "reasonable". Not only will the action be unlawful but unlawfulness in decision-making should have practical consequences even if it does not always lead to outright invalidity: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 29 ; (1998) 194 CLR 355 at [100] .


case_outcome: followed

case_title: Bridges v Minister for Immigration and Multicultural Affairs [2001] FCA 1647 ; (2001) 67 ALD 306

case_text: The misapplication of the phrase "reasonable disciplinary action" by the Tribunal thus does not authorise the upholding of this appeal. The Full Court in Bridges v Minister for Immigration and Multicultural Affairs [2001] FCA 1647 ; (2001) 114 FCR 456 at [10] said that [t]he governing principle is that a decision of an administrative tribunal will be set aside for error of law if it can be shown that the error could have affected the outcome of the case, that is that a different result might have been reached had no error of law been made: X v Commonwealth [1999] HCA 63 ; (1999) 200 CLR 177. 53 There are other matters.


case_text: In deciding the first point the Senior Member relied on the following passage from Commission for the Safety, Rehabilitation and Compensation of Commonwealth Employees v Chenhall [1992] FCA 535 ; (1992) 37 FCR 75 at 83-4: In the context of the definition of "injury" in s 4(1) of the Act, the phrase "disciplinary action" means no more than reasonable action lawfully taken against an employee in the nature of or to promote discipline. ... What is clear to my mind is that it is the disciplinary action itself and not the steps anterior to the decision to take such action which is covered by the definition. ... Thus, action taken to determine whether or not disciplinary action will be taken against an employee, although it may be characterised as part of a system or process to maintain discipline, is not action within the meaning of the definition of "disciplinary action" in the Act. 21 The Department of the Senate had adopted a regime of Procedures for ... Determining Breaches of the Parliamentary Service Code of Conduct (the Procedures). This document provided for the Usher of the Black Rod to appoint an investigator to determine whether there had been a breach of the Code by an employee, and to report his or her findings to the Usher. The document provided that "[h]aving considered any mitigating comments from the employee, the [Usher] will determine the case and inform the employee in writing of the determination, any sanction imposed, the reasons for them, and the employee's rights of review". 22 The Tribunal held that, according to these procedures, it was "clear that the process did not go beyond an investigation and reporting of findings to the Usher of the Black Rod and the disciplinary action envisaged by the Procedures document did not take place". In these circumstances the Senior Member found that no disciplinary action was taken against the respondent. 25 The respondent ultimately accepted Comcare's position as to the asserted misapplication of Chenhall [1992] FCA 535 ; 37 FCR 75 and the error as to when disciplinary action against Ms Eames had commenced. However the respondent pointed out that, even so, the Tribunal's decision is unassailable because the Tribunal found that the injury (in either of its alternative characterisations) occurred on 14 November 2004 whereas, on any view, the disciplinary action did not commence before 1 December. 26 As to the alleged "reasonableness" of the disciplinary action, the respondent denies any error of law by the Tribunal and in any case says that the ultimate question of whether disciplinary action is "reasonable" is a question of fact only or, at most, a mixed question of fact and law, neither of which can found a s 44 appeal. 27 As finally formulated, the applicant sought by foreshadowed amendments to the notice of appeal to raise the following questions of law: 3.1 Whether action taken under s 15 of the Parliamentary Service Act 1999 (Cth) and the procedures established under s 15(3) of the said Act under clauses 2 to 5 constitutes "disciplinary action" under s 4 of the Act. 3.2 If the answer to question 1 above is "yes", whether the disciplinary action taken constitutes "reasonable disciplinary action" within the meaning of s 4 of the Act, as long as the action taken is not absurd, ridiculous or disproportionate. 3.3 In the alternative to paragraph 3.2 above, if reasonable disciplinary action requires procedural fairness to be given, what is the content of such an obligation. 3.4 Following on from paragraph 3.3 above, if procedural fairness is to be given, whether this obligation is discharged if: 3.4.1 The substance of the allegations; and 3.4.2 The substance of the evidence, on which the findings of the breaches are to be based, are given to the person in question. 29 It appeared that Comcare's principal concern prompting the appeal was the Tribunal's treatment of the disciplinary action in question. Comcare accepts the correctness of Cooper J's exposition of the law in Chenhall [1992] FCA 535 ; 37 FCR 75 as to what constitutes "disciplinary action" and the distinction between such action and things done by way of investigation preparatory to the commencement of the actual disciplinary action. However the applicant is concerned that the Tribunal misapplied Chenhall [1992] FCA 535 ; 37 FCR 75 in a way that would unduly narrow the practical effect of the intended statutory exemption of disciplinary action caused injuries from liability. 30 The applicant's submissions may be summarised as follows. 31 The construction of the phrase "reasonable disciplinary action" in s 4 of the Act (as it was at the relevant time) is a question of law: Chenhall 37 FCR at 78; similarly, in Comcare v Etheridge [2006] FCAFC 27 ; (2006) 149 FCR 522 and HBF Health Funds Inc v Minister for Health and Ageing [2006] FCAFC 34 ; (2006) 149 FCR 291 , the Full Court was satisfied that questions of law were raised with respect to the definition of some concepts in the relevant Commonwealth legislation. 33 The action taken in the present case was clearly disciplinary action. The regulatory regime as to disciplinary action in Chenhall [1992] FCA 535 ; 37 FCR 75 differed materially from that in the present case. The Tribunal in the present case applied the cited passage from the judgment of Cooper J, without proper appreciation of the particular factual contexts and the terms of the relevant regulatory schemes in Chenhall [1992] FCA 535 ; 37 FCR 75 and in the present case. Notwithstanding that the Senior Member cited the correct and helpful explanation of the phrase "reasonable disciplinary action", from Chenhall [1992] FCA 535 ; 37 FCR 75 the conclusion he reached was not open to him if he had correctly applied that definition. In this way the Tribunal erred in law. 34 In Chenhall [1992] FCA 535 ; 37 FCR 75 , Cooper J was reviewing a decision regarding a compensation claim made by an Australian Federal Police (AFP) officer, following an interview which was conducted as part of an investigation in accordance with the AFP General Orders. General Order 6 provided for the investigation of allegations and disciplinary matters to which the Complaints (Australian Federal Police) Act 1981 (Cth) (Complaints Act) did not apply. Cooper J concluded that disciplinary action, in the context of the regulatory scheme in Chenhall [1992] FCA 535 ; 37 FCR 75 , was not lawfully taken against the member of the AFP until: (a) the provisions of the General Order had been complied with; (b) the Commissioner determined in accordance with the Australian Federal Police (Discipline) Regulations 1979 (Cth) (Discipline Regulations) or the Complaints Act what action to take against the particular member in respect of a defined disciplinary offence; and (c) the Commissioner took one of the steps provided for under the Discipline Regulations or the Complaints Act to give effect to the determination. 35 The present regulatory regime, drawn from the Procedures, is distinguishable but also has a number of steps: 1. Unless a report of a breach (or alleged breach) of the Code of Conduct is considered to be frivolous or vexatious, the person receiving the report is to inquire into the allegations and determine whether there is enough evidence to justify further investigation. These initial considerations include 1.1 Is it a case of poor performance or misconduct? 1.1.1 If misconduct is alleged (a) is it minor and able to be dealt with informally by counselling or some other action; or (b) is it of such significance that an investigation is required? 1.2 Is suspension or temporary re-assignment of duties warranted? 1.3 Should the police be notified? 2. If there is sufficient evidence to warrant further investigation, the Usher will select a person who is independent and unbiased to determine whether the employee has breached the Code of Conduct. 3. The employee is informed in writing of the allegation(s), who is conducting the investigation and the sanctions that may be imposed if he/she is found to have breached the Code. 4. Having investigated the allegations with due regard for procedural fairness, the investigator will report the findings to the Usher. 5. If there is no breach found, the Usher will advise the employee in writing. If the investigator finds that a breach has occurred, he or she may also recommend an appropriate sanction. At this point the Usher must provide a copy of the findings to the employee and invite comment on any proposed sanction. 6. After considering any mitigating comments from the employee, the Usher will determine the case and inform the employee in writing of the determination, any sanction imposed, the reasons for them, and the employee's rights of review. 36 Steps 2-5 above constitute the taking of disciplinary action and had been taken in the present case prior to 3 February 2005. On 1 December 2004, two broad allegations were advised by the Usher of the Black Rod to the investigator, Mr Curtis. Mr Curtis found that a breach of the Code of Conduct had occurred, and recommended an appropriate sanction. On 15 December, Ms Griffiths (the Usher) provided a copy of the Curtis report to the respondent and invited comment. 37 The fact that the process did not culminate in the imposition of a sanction is not to the point and the Tribunal erred in so thinking. 38 The Tribunal's finding of liability from 14 November 2004 to April 2005 cannot have been made regardless of its discussion about disciplinary action: there is no indication in the Tribunal's reasons that the discussion about disciplinary action was not determinative of its final orders, no introductory phraseology such as "in any event" was used; the Tribunal devoted time and energy to this issue during the hearing and in its decision, indicating that its remarks were not a mere digression. Finally, the applicant submits that Dr Wessell's evidence indicated that it was the disciplinary action which was most causative of the alleged stress to the respondent. It defies commonsense to say that the disciplinary action was of no moment to the onset of or the aggravation of the alleged injury. 46 I agree with the parties that Chenhall [1992] FCA 535 ; 37 FCR 75 correctly and helpfully discusses the law as to what is necessary to constitute "disciplinary action". Whether particular conduct amounts to "reasonable disciplinary action" has previously been treated as a question of law: Chenhall [1992] FCA 535 ; 37 FCR 75 ; Schmid v Comcare [2003] FCA 1057 ; (2003) 77 ALD 782 , [84]. The question is: at what point in the regulatory regime in the present case did disciplinary action begin? This requires an analysis of that regime. 47 It appears that the learned Senior Member did misapply the definition of "reasonable disciplinary action", in that he did not consider disciplinary action within the meaning of the Act to have occurred at all in the present case. I accept that disciplinary action had begun from 1 December 2004, when the respondent was provided with the allegations made against her. What is described within the Procedures as an "investigation" is, when viewed in the context of the Parliamentary Services Commissioner's Direction 2000/1 (the basis of the Procedures, in accordance with s 15 of the Parliamentary Service Act 1999 (Cth)), actually a determination of whether there has been a breach of the Code of Conduct. This is clearly "action lawfully taken against an employee in the nature of or to promote discipline": Chenhall 37 FCR at 83. Cooper J explicitly (and in my respectful opinion, correctly) rejected the proposition that disciplinary action refers only to the actual imposition of a sanction: Chenhall 37 FCR at 85. The Tribunal appears to have misconstrued Chenhall [1992] FCA 535 ; 37 FCR 75 in this respect: at [39] it said "[t]aking into account the Senate's own procedures it is clear that the process did not go beyond an investigation and reporting of findings to the Usher of the Black Rod and the disciplinary action envisaged by the Procedures document did not take place". That is to conflate the entire process of disciplinary action and its ultimate outcome. Had the allegations not been sustained, the action of investigating them for the direct purpose of determining whether any sanction should be applied would nevertheless have been "disciplinary" action. 48 Notwithstanding this error, it needs to be shown that the actual decision may have been affected by it: the "appeal" is from the decision not from the reasons given in support of it. 49 By design or otherwise, reasons for decision given by decision-makers of all kinds frequently include expressions of opinion on material discussed in the case at hand that are unnecessary for the actual decision; in particular, appellate or reviewing decision-makers often intend, in that way, to be helpful to primary decision-makers. Tribunals giving opinions which are, logically, gratuitous do not always understand that, in terms of doing only what is necessary, an opinion expressed may have that character. Even where this is understood, a busy tribunal member may omit an explanation for undertaking the excursus. Frequently, judges (even at the highest levels) discuss unnecessary material and, often enough, without expressly flagging their understanding that they are doing so. At least an equal degree of understanding of the process of writing reasons for decision can and should properly be extended to administrative tribunals. The eye too keenly attuned to unduly strained inference needs some detuning. 56 This implies another consideration: Cooper J in Chenhall [1992] FCA 535 ; 37 FCR 75 indicated (rightly, in my respectful view) that, among other things, to be "disciplinary action" in terms of the statute, the action needed to be "lawfully" taken. If procedural fairness be denied, the action will not be lawful, whether or not some circumstances may exist (about which I say nothing) in which the action might nevertheless be "reasonable". Not only will the action be unlawful but unlawfulness in decision-making should have practical consequences even if it does not always lead to outright invalidity: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 29 ; (1998) 194 CLR 355 at [100] .


case_text: I agree with the parties that Chenhall [1992] FCA 535 ; 37 FCR 75 correctly and helpfully discusses the law as to what is necessary to constitute "disciplinary action". Whether particular conduct amounts to "reasonable disciplinary action" has previously been treated as a question of law: Chenhall [1992] FCA 535 ; 37 FCR 75 ; Schmid v Comcare [2003] FCA 1057 ; (2003) 77 ALD 782 , [84]. The question is: at what point in the regulatory regime in the present case did disciplinary action begin? This requires an analysis of that regime.


case_text: The content of a duty to accord procedural fairness in a particular case is also a question of law, relying on Clements v Independent Indigenous Advisory Committee [2003] FCAFC 143 ; (2003) 131 FCR 28 at 31-2 per Gray ACJ and North J. 54 The foundation of the Senior Member's view that the action, now held to be disciplinary, was not "reasonable" rested entirely upon an opinion that the inquisitor had not accorded Ms Eames procedural fairness in circumstances where there was plainly a duty to afford it. At least in such circumstances, whether procedural fairness was given is to be categorised as a question of law, even though it obviously depends on factual findings. In Clements 131 FCR at [6]-[8] the Full Court held that whether the Tribunal itself denied procedural fairness is a question of law and, with respect, this must be so. In general, questions of law are those which are inescapably for a judge to decide. In many instances, these actually involve inquiry into and assessment of factual matters by the judge. Judgments on the admissibility of evidence are often examples of this. Whether procedural fairness has been given is such a question because, if procedural fairness has not been given, the administrative action in question (and not just disciplinary action) is affected by jurisdictional error: eg Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597. Whether there has been a jurisdictional error is, ex hypothesi, a question of law.


case_text: correct analysis seems to be that while MCA is in liquidation, it is disqualified from performing its duties and exercising its powers under the Unit Trust Deed, but continues to hold the property of the Trust upon a constructive trust by the operation of general law principles. It is an interesting question what the terms of the constructive trust are. It may be that MCA simply holds the property upon a passive constructive trust for these unit holders in equal shares. It may also be that upon termination of the winding up, MCA again assumes the role of trustee under the express terms of the Unit Trust Deed: cf O'Reilly v Alderson [1849] EngR 680 ; (1849) 8 Hare 101 (68 ER 289). I am not called upon to decide these questions. In one way or another, it is clear that MCA will resume its position as trustee under the express terms of the Unit Trust Deed. Clause 11.4.3 of that Deed provides that with the unanimous consent of the unit holders in writing or by special resolution of the unit holders in general meeting, the unit holders are entitled to appoint a trustee in place of any trustee who is disqualified. It would not be in the interests of any of the unit holders to obstruct the passing of such a resolution if it should be thought necessary. Moreover, RSW and MMI have paid SC the purchase price for its units, and could compel SC to join with them in reappointing MCA as trustee, if this should be thought necessary in order to enable the unit transfers to be registered. It was for the above reasons that I was satisfied that MCA was solvent and that I ordered the winding up should be terminated. I certify that the preceding thirty-seven (37) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren. Associate: Dated: 9 June 2009 Solicitor for the Plaintiffs: Mr D M Crompton of Church & Grace Date of Hearing: 29 May 2009 Date of Judgment: 29 May 2009 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2009/625.html


case_title: Bahonko v Sterjov [2007] FCA 1244

case_text: Appellant has leave to amend her Notice of Appeal of 16 August 2007 to include Justice Goldberg's orders of 27 August 2007, Justice Jessup's orders and reasons given to the Registrar in the VID 114/06 and Justice Finkelstein's orders and reasons given to the Registrar in VID 114/06." 2 For the reasons below, I would dismiss the Notice of Motion. BACKGROUND Substantive Proceedings 3 The events which give rise to the Notice of Motion have a long and complicated history. In general terms, they relate to Ms Bahonko's employment at a kindergarten operated by the first and second respondents which was managed by the third respondent ("Ms McEwan"). Ms Bahonko had been employed, on a trial basis, at La Kosta Child Care Centre & Kindergarten Pty Ltd ("La Kosta") on 7 November 2005. Her employment was terminated just 4 days later on 10 November 2005 on grounds of "serious misconduct" relating to allegations of physical and psychological abuse by Ms Bahonko of children at the kindergarten and verbal abuse of other staff members, including Ms McEwan: see [2007] FCA 1244 at [3] - [8] . 4 Ms Bahonko filed two applications: (1) an application pursuant to s 170CP of the Workplace Relations Act 1996 (Cth) ("the WR Act") (in the form it took in November 2005) alleging contraventions of ss 170CK(2) and 170CM of the WR Act and other unlawful or tortious conduct ("the WR Act application"); and (2) an application pursuant to s 46PO of the Human Rights and Equal Opportunity Act 1996 (Cth) ("the HREOC Act") alleging unlawful discrimination under the Racial Discrimination Act 1975 (Cth) ("the RD Act "). 5 The two applications were consolidated on 6 November 2006. The hearing of the applications occupied 9 separate hearing days before Jessup J between April and July 2007. Evidence relating to Ms Bahonko's appointment at La Kosta, the period of her employment and the termination of her employment were considered at length by Jessup J: see [2007] FCA 1244 at [24] - [93] . Jessup J dismissed the applications. 6 In addition, the Ms Bahonko also made claims against the Respondents in the Court's accrued jurisdiction: see [123]ff. Ms Bahonko's claim in defamation against La Kosta was upheld and Ms Bahonko was awarded $50 in damages: see [126] and [186]. The other claims in the accrued jurisdiction were dismissed. 7 On 15 August 2007, substantive orders were made by Jessup J in the following terms: "1. To the extent not previously dealt with by the court, the motion of which the applicant gave notice on 4 May 2007 be dismissed. 2. The fourth respondent pay the applicant damages in the sum of $50. 3. The application otherwise be dismissed. 4. The parties have leave to file and serve: (a) on or before 22 August 2007, their written submissions as to costs; (b) on or before 24 August 2007, any submission in reply to the costs submission of another party." ("the Substantive Orders") 8 On 16 August 2007, Ms Bahonko filed a notice of appeal ("the Notice of Appeal") against the Substantive Orders ("the Appeal").


case_title: Bahonko v Sterjov [2007] FCA 1341

case_text: On 31 August 2007, Jessup J made orders as to costs in the substantive proceedings ("the Costs Orders"): see Bahonko v Sterjov [2007] FCA 1341. On 21 September 2007, Ms Bahonko amended her Notice of Appeal to appeal the Costs Orders ("the Amended Notice of Appeal").


case_title: Bahonko v Sterjov [2007] FCA 1377

case_text: On 27 August 2007, Goldberg J heard and dismissed an application by Ms Bahonko for a stay of the Substantive Orders: see Bahonko v Sterjov [2007] FCA 1377. 13 As set out in [1] above, by the Notice of Motion Ms Bahonko seeks the following relief: (1) leave to appeal against the orders of Goldberg J of 27 August 2007 ("the Application for Leave to Appeal"). This concerns the first three paragraphs of the Notice of Motion; (2) leave to further amend the Amended Notice of Appeal. This concerns paragraph 4 of the Notice of Motion; I will deal with each in turn. 14 Leave is required to appeal Goldberg J's refusal to grant a stay of the Substantive Orders because that judgment is interlocutory in nature: ss 24(1)(a) and (1A) of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act "). It did not " finally " determine " the parties' substantive rights " ( Cubillo v Commonwealth [2001] FCA 1213 ; (2001) 112 FCR 455 and Carr v Finance Corp of Australia Ltd (No 1) [1981] HCA 20 ; (1981) 147 CLR 246 at 248 per Gibbs CJ and 253-54 per Mason J) but dealt with questions about whether the Substantive Orders would be stayed pending the hearing and determination of the Appeal. An application for leave to appeal may be heard and determined by a single judge: ss 24(1A) and 25 (2) of the Federal Court Act . 18 As Goldberg J identified, O 52 r 17(1) of the Federal Court Rules provides that an appeal " shall not" operate as a stay of execution of the orders appealed from " except so far as ... a Judge... may direct" . Goldberg J was entitled to determine, in light of all the circumstances, whether the matter was an appropriate case for the grant of a stay: Powerflex Services Pty Ltd v Data Access Co (1996) 67 FCR 65. Clearly, it was not. First, his Honour correctly identified that paras 1, 2 and 3 of the Substantive Orders were not the appropriate subject of a stay: see [2007] FCA 1377 at [7] - [10] , [15] and [16]. Neither was it appropriate for Ms Bahonko to seek to suspend the resolution of the substantive applications by seeking a stay of para 4 of the Substantive Orders dealing with submissions on costs. In any event, the Costs Orders were made by Jessup J on 31 August 2007. There is no utility in Ms Bahonko seeking leave to appeal from Goldberg J's refusal to stay para 4 of the Substantive Orders.


case_title: Bahonko v Sterjov [2007] FCA 867

case_text: On 24 May 2007, following the closure of the respondents' evidentiary case on the two applications (see [4] above) before Jessup J, Ms Bahonko attempted to make a range of oral applications including an application to file a statement of charge for contempt of court against the respondent and the respondents' legal representatives, Mr McKenney and Mr Vitiello, and sought to challenge the competency of two of the witnesses called on behalf of the respondents, the fourth respondent and Ms Esther Matthews. Jessup J did not grant leave to file these applications: see [8] at paras (2) and (4) and [9] of Bahonko v Sterjov [2007] FCA 867. 12 On 30 May 2007, Ms Bahonko sought leave to appeal Jessup J's decision not to grant leave to file the statement of charge for contempt of Court. On 9 June 2007, Finkelstein J made a direction to a Registrar under O 46 r 7A of the Federal Court Rules that the notice of motion dated 30 May 2007 be refused for filing.


case_text: Ms Bahonko seeks leave to amend her Notice of Appeal to include an appeal from a direction by Jessup J and a further direction by Finkelstein J to a Registrar pursuant to O 46 r 7A of the Federal Court Rules that the Registrar refuse to accept an application presented by Ms Bahonko for issue by the Registrar. The application is dismissed. A direction under O 46 r 7A is not a judgment able to be subjected to an appeal by Ms Bahonko: Bizuneh v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 42 ; (2003) 128 FCR 353 at [19] per Lee, Whitlam and Jacobson JJ. See also Paramasivam v Randwick City Council [2005] FCA 369 at [40] and [41] per Sackville J.


case_text: Leave is required to appeal Goldberg J's refusal to grant a stay of the Substantive Orders because that judgment is interlocutory in nature: ss 24(1)(a) and (1A) of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act "). It did not " finally " determine " the parties' substantive rights " ( Cubillo v Commonwealth [2001] FCA 1213 ; (2001) 112 FCR 455 and Carr v Finance Corp of Australia Ltd (No 1) [1981] HCA 20 ; (1981) 147 CLR 246 at 248 per Gibbs CJ and 253-54 per Mason J) but dealt with questions about whether the Substantive Orders would be stayed pending the hearing and determination of the Appeal. An application for leave to appeal may be heard and determined by a single judge: ss 24(1A) and 25 (2) of the Federal Court Act .


case_title: Cubillo v Commonwealth [2001] FCA 1213 ; (2001) 112 FCR 455


case_text: To obtain leave to appeal from Goldberg J's refusal to grant a stay of the Substantive Orders, Ms Bahonko is required to satisfy the Court that: (1) it is attended by sufficient doubt to warrant reconsideration by a Full Court; and (2) substantial injustice would result if leave were refused, Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 at 398-99 (per Sheppard, Burchett and Heerey JJ). 16 It is well established that in cases where the interlocutory decision does not determine substantive rights, particular caution is required and "a tight rein" must be kept on appeals ( Décor at 400). This is such a case. Ms Bahonko must satisfy both limbs of the test. She does not. 17 The decision is not attended with any doubt, let alone sufficient doubt to warrant reconsideration by a Full Court. Even if the decision was attended with doubt, I am not satisfied that Ms Bahonko would suffer any injustice let alone " substantial injustice" in the event that leave was refused.


case_title: Paramasivam v Randwick City Council [2005] FCA 369


case_text: As Goldberg J identified, O 52 r 17(1) of the Federal Court Rules provides that an appeal " shall not" operate as a stay of execution of the orders appealed from " except so far as ... a Judge... may direct" . Goldberg J was entitled to determine, in light of all the circumstances, whether the matter was an appropriate case for the grant of a stay: Powerflex Services Pty Ltd v Data Access Co (1996) 67 FCR 65. Clearly, it was not. First, his Honour correctly identified that paras 1, 2 and 3 of the Substantive Orders were not the appropriate subject of a stay: see [2007] FCA 1377 at [7] - [10] , [15] and [16]. Neither was it appropriate for Ms Bahonko to seek to suspend the resolution of the substantive applications by seeking a stay of para 4 of the Substantive Orders dealing with submissions on costs. In any event, the Costs Orders were made by Jessup J on 31 August 2007. There is no utility in Ms Bahonko seeking leave to appeal from Goldberg J's refusal to stay para 4 of the Substantive Orders.


case_text: Ms Bahonko in her affidavit of 3 September 2007, and during the course of her oral submissions, made allegations which are properly described as scandalous. They include allegations of criminal conduct and conduct constituting abuse of office. Those allegations are unsupported and insupportable. Ms Bahonko submitted that she required access to the transcript of the hearing before Goldberg J to make good her allegations. That access is refused on a number of bases. First, access to transcript has never been regarded as an indisputable requirement of a fair trial: see Young v Secretary for Department of Family and Community Services (2003) 76 ALD 118 at [30]. Secondly, the hearing before Goldberg J did not involve viva voce evidence. Both parties were present at the hearing and made submissions. Moreover, by reason of the nature of the application before me (an application for leave to appeal from the orders of Goldberg J), it was necessary for me to consider the correctness of the decision of Goldberg J. As stated above, that decision is not attended with any doubt. Access to the transcript of proceedings before Goldberg J would be futile. For those reasons, access is refused. 21 In the circumstances, I would not grant Ms Bahonko leave to appeal Goldberg J's refusal to grant a stay of the Substantive Orders. I would dismiss paras 1, 2 and 3 of the Notice of Motion and order Ms Bahonko to pay the respondents' costs of and incidental to those paragraphs in the Notice of Motion. 22 Finally, there was no doubt that Goldberg J correctly refused to grant an injunction in the alternative to a grant of a stay. As Goldberg J said the appropriate process was for Ms Bahonko to appeal against the Substantive Orders and the Costs Orders, as she has now done.


case_title: Conor Medsystems, Inc v The University of British Columbia (No 2) (2006) 68 IPR 217

case_text: also referred to the recent decision of Finkelstein J in Conor Medsystems, Inc v University of British Columbia (No 2) (2006) 68 IPR 217. His Honour considered the meaning of the words "is not entitled to the patent" which appear in the ground of revocation under s 138(3)(a) of the Act . His Honour said at [19]: respondents also contend that, having regard to the use of the present tense in s 138(3)(a) , a condition precedent to a revocation order is a finding that the patentees were not entitled to the patent at the time of the application for revocation (or perhaps at the time of the hearing). I am far from persuaded that this construction is correct and it seems to be contrary to the views of Cooper J in Stack v Brisbane City Council (1999) 47 IPR 525, 536 and Crennan J in JMBV Enterprises Pty Ltd v Camoflag Pty Ltd [2005] FCA 1474 , [130]-[131]. But even if this construction were correct, the way in which I would read the section is that if a person were not entitled to the patent at the time of grant then, at least in most cases, that non-entitlement would be (as here) a continuing state of affairs. So there is really nothing in the point." My reasons for reaching this conclusion may be stated briefly . Ultimately, the relevant time at which (or period in which) utility is to be assessed is a matter of construction of the Act and informed by authorities construing cognate legislation. I am not aware of any authority in this country or the United Kingdom which decides that a patent, in order to be immune from revocation on the grounds relating to utility, must concern an invention which not only was useful at the time of grant but also remained useful during the period of the statutory monopoly. There is authority to the contrary: Lane Fox v Kensington and Knightsbridge Electric Lighting Company . While s 138(3)(b) is expressed in the present tense - "that the invention is not a patentable invention" - that formulation raises for consideration whether the invention is useful for the purposes of s 18(1)(c). It therefore directs attention to whether the invention is useful at the time it was sought to be patented. This construction appeared to be favoured by Finkelstein J: see Conor Medsystems, Inc v University of British Columbia (No 2).


case_text: Court has a discretion to control discovery. Parties do not have an unfettered right to obtain discovery from other parties of any document, including documents which might, for example, fall within the classes of documents identified in O 15 r 2(3)(a)-(d), being any document on which the party called on to provide discovery relies, adversely affects their case or adversely affects or supports another party's case. Kiefel J summarised the principles in Index Group of Companies Pty Ltd v Nolan [2002] FCA 608 at [6] - [7]: respondents do not dispute the Court's power to make orders of the kind proposed. They contend that the starting point is their right to discovery. That would not seem to be a correct approach. If it be correct to speak of a party's right to access documents by this process, and that seems doubtful, it is only a right in a qualified sense. This is especially so under the rules of this Court. The Court has a discretion under O 15 r 3 to make an order for discovery and rr 2 and 15 of that order make plain that the Court is to avoid an unnecessary discovery: Cameron v Rural Press Limited (Full Court, 20 July 1990, unreported); also Practice Note 14. is spoken of as a "right" is the provision to a party of documents by use of a Court process, to ensure that litigation is, as far as possible, fair. That is a matter of public interest. In that context it may be understood that the Court's processes, in requiring discovery, will only be utilised as far as is necessary to ensure justice as between the parties and no more: see Home Office v Harman [1983] 1 AC 280, 380 applied Mobil Oil Australia Ltd v Guina Developments Pty Ltd [1996] 2 VR 34,37,38 and Trade Practices Commission v CC (NSW) Pty Ltd (1995) 58 FCR 426, 436." In my view, an application to revoke a patent on the ground that it is not useful raises for consideration the question of whether it was useful at, in all probability, the time of grant. It may conceivably be the priority date, but that is a matter of detail which does not require resolution at this time. Importantly, an application to revoke on the grounds of utility does not raise the question of whether, since grant, the patent has remained useful. It is true, as Alphapharm submitted, that evidence concerning whether a process involving or relating to chemical reactions was useful at a particular point in time (such as in the years following grant) could be probative of whether a patent was useful at an earlier point in time (such as the time of grant). Given the comparative immutability of the laws of physics, that proposition is almost certainly correct. However, that logic does not dictate that Alphapharm can require Merck to give discovery of documents concerning experiments and the like for the years following the grant of the patent. The documents Merck may have which existed at the time of grant and which might tend to establish (or raise doubts about) the usefulness of the process are appropriate to be discovered. However, to require Merck to give discovery of documents concerning events after the grant of the patent would, in my opinion, entirely skew the process of discovery and be incongruent with the balance referred to by Kiefel J in the passage quoted above. I apprehend that this conclusion may resolve issues concerning electronic discovery and also issues concerning the manufacturing process. If this is not so, I will hear the parties further on those issues. The only order I propose to make is that the parties bring in short minutes to give effect to these reasons within 7 days. I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. Associate: Dated: 15 September 2006 Counsel for the Applicant: S Burley and J S Cooke Solicitor for the Applicant: Mallesons Stephen Jacques Counsel for the Respondent: K Howard Solicitor for the Respondent: Cropper Parkhill Solicitors Date of Hearing: 26 July 2006 Date of Judgment: 15 September 2006 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2006/1227.html


case_text: Nicaro Holdings Pty Ltd v Martin Engineering Co (1990) 91 ALR 513 Gummow J (at 524 and 542) cautioned against the Court construing a patent by seeking to place itself in the position of a reader skilled in the art without expert evidence which would permit it to view the patent through the eyes of such a reader. Those observations were made in relation to a claim of lack of novelty. However, it would appear that they are also pertinent to the assessment of utility, at least where the patent concerns matters not demonstrably within the domain of ordinary human experience such as simple mechanical devices. This is the import of observations of Gummow J in Rescare Ltd v Anaesthetic Supplies Pty Ltd (1992) 111 ALR 205 at 232 referring, in turn, to the observations of Menzies J in Welch Perrin & Co Pty Ltd v Worrel [1960] HCA 91 ; (1961) 106 CLR 588 at 601.


case_text: Nicaro Holdings Pty Ltd v Martin Engineering Co (1990) 91 ALR 513 Gummow J (at 524 and 542) cautioned against the Court construing a patent by seeking to place itself in the position of a reader skilled in the art without expert evidence which would permit it to view the patent through the eyes of such a reader. Those observations were made in relation to a claim of lack of novelty. However, it would appear that they are also pertinent to the assessment of utility, at least where the patent concerns matters not demonstrably within the domain of ordinary human experience such as simple mechanical devices. This is the import of observations of Gummow J in Rescare Ltd v Anaesthetic Supplies Pty Ltd (1992) 111 ALR 205 at 232 referring, in turn, to the observations of Menzies J in Welch Perrin & Co Pty Ltd v Worrel [1960] HCA 91 ; (1961) 106 CLR 588 at 601. In addition to the time-based exclusion, Merck argued that it should not be required to discover documents relating to the adaptation of processes for manufacturing purposes. It claimed that the issue of utility was directed at whether the invention claimed did not attain the result promised by the patentee and not whether following the directions in a patent was commercially viable (citing Rescare Ltd v Anaesthetic Supplies Pty Ltd (1992) 111 ALR 205 and Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd [1998] HCA 19 ; (1998) 194 CLR 171). It submitted that although documents showing that commercial manufacturing was possible might be relevant, documents relating to commercial production (such as manufacturing documents, including scale up documents) were not relevant. Alphapharm claimed that manufacturing documents were relevant to utility in this case because of the particular promises of the invention which include a specific reference to commercial manufacturing capabilities. It submitted that the cases relied upon by Merck to support the irrelevance of commercial practicality were not on point because in those cases, the patentee did not promise commercial practicality. It also submitted that on Merck's evidence (being the affidavit of John Simpson sworn 2 June 2006), commercial manufacture of the process claimed in the patent did not commence until 1993. It referred to the fact that the Merck's proposed exclusion on manufacturing documents, as expressed in order 4 of its notice of motion, expressly referred to "documents relating to the adaptation of the processes claimed". Those factors, it was said, made it clear that the process the subject of the promises required adaptation in order to make them work commercially. Such documents were therefore clearly within the scope of discoverable documents. As an additional or alternative basis for limiting discovery in the way proposed, Merck submitted that the Court should exercise its discretion not to order discovery beyond what Merck offered to discover, on three main bases. First, it submitted that Alphapharm's case based on inutility, as particularised, was unarguable or unlikely to succeed. Secondly, the requested discovery would be oppressive for Merck, as it would have to trawl through 17 years of documents. In support of oppressiveness, Merck relied on the affidavit of John Simpson sworn 2 June 2006. His evidence was that the documents relating to manufacture of the drug comprised over 100,000 pages, held at the plant in the Republic of Ireland. The costs to Merck of discovering those documents, including the costs of solicitors travelling to Ireland to review the documents, was estimated as being in the order of $55,000. That amount excluded any allowance for time spent by the respondent's employees in assisting with the task. Thirdly, the interests of justice would not be served by requiring further discovery because Alphapharm's case was weak and the discovery sought was a fishing expedition. Alphapharm resisted the proposition that the Court's discretion should be exercised as proposed by Merck. It submitted that as a matter of policy, Merck should not be able to rely on an arbitrary date limitation on discovery to avoid having to discover documents which are directly relevant and probative.


case_text: things may be said, with respect, in relation to that passage in Peekhurst . Firstly, it is predicated upon what has later been shown to be a false line of Queensland authority in respect of statutory demands for taxation debts; see Deputy Commissioner of Taxation v Broadbeach Properties Pty Ltd; Deputy Commissioner of Taxation v MA Howard Racing Pty Ltd; Deputy Commission of Taxation v Neutral Bay Pty Ltd [2008] HCA 41 ; (2008) 82 ALJR 1411. Secondly - and more pertinently for present purposes - it is evident from the passage quoted that his Honour's attention was not drawn to a line of New South Wales authority in respect of legislation in that State analogous to the Building and Construction Industry Payments Act and the interrelationship between adjudications under that Act and the setting aside of statutory demands pursuant to the Corporations Act on the basis of there being, in terms of that legislation, a dispute or offsetting claim.


case_text: that regard, there is a discretion to exercise. A case which has proved influential on the subject of the awarding of indemnity costs is Colgate-Palmolive Company v Cussons Limited [1993] FCA 536 ; (1993) 46 FCR 225. There, at pages 232 to 234, Sheppard J comprehensively summarises the effect of authorities in relation to the awarding of costs and, in particular, to the awarding of costs on an indemnity basis. His Honour gives some examples at item 5, page 233 to 234, of circumstances in which it has been regarded as appropriate to award costs on an indemnity basis. In so doing, his Honour is astute to preface the giving of those examples by reference to an overriding principle that there is a discretion, which is not relevantly fettered, to be exercised. This, his Honour observes that, at item 4, page 233: Most judges dealing with the problem have resolved the particular case before them by dealing the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule. The categories in which the awarding of indemnity costs are appropriate are not closed. I accept, then, that though the discretion is, as I have said, unfettered in the sense that the categories are not closed, it is nonetheless a departure from a usual rule which would allow costs only on a party and party basis. One circumstance which has enlivened a disposition to award costs on an indemnity basis is the imprudent refusal of an offer to compromise. The correspondence which preceded the filing of the application was, in effect, a highly detailed rationale for why it was that a compromise of sorts ought to be achieved. That compromise may have been distasteful to Total Building Group, in light of an unfortunate falling out between it and Tesoro, but it was a compromise which had about it a compelling quality, which was, "Withdraw the statutory demand and let us litigate our differences in a court of appropriate jurisdiction." Ultimately, that realisation does seem to have come to Total Building Group, but belatedly. Part of the realisation to which it was asked to come was that the sum the subject of a statutory demand had indeed been paid to it. Perhaps that realisation also came to Total Building Group by 24 June 2009. In any event, it seems to me that the stance taken by Total Building Group in the face of the correspondence prior to 11 June 2009 was imprudent. It was submitted that the stance which came to be adopted by Total Building Group ought to be judged by reference to the material which is to be found in the affidavit filed in support of the application to set aside the statutory demand, ie, that of Mr Maggiolo. As I have already observed, that affidavit is detailed, indeed.


case_text: client's rights in relation to the Contract (which are maintained under s 100 of the Building and Construction Industry Payments Act 2004 (Qld)) constitutes sufficient "other reason" within the meaning of s 459J of the Corporations Act 2001 (Cth) for the demand to be set aside. The letter sought a response by 4 pm on 25 May 2009. There was a prompt response by Winchester Young & Maddern to Cooper Grace Ward on 25 May 2009: The Adjudication decision was made on 11 March 2009. In this decision, the Adjudicator took into account the payment by your client of $35,279.50 on 8 January 2008 and the depositing of $53,548.11 into our trust account on 23 January 2008. The Adjudicator stated that he was not aware of the status of these sums of money and would go on to set out what he found due under the payment claim and leave it to the parties and their solicitors to decide how payment was to be made. Our client acknowledges the receipt of $27,782.40 paid to our clients prior to the lodgement of Adjudication Application 10 which was lodged on 26 February 2009 and the decision made on 11 March 2009. Our client had returned the sum of $25,765.71 being the balance of $53,548.11, to your client on 20 February 2009. In its Adjudication Application our clients acknowledged and deducted the sum o f$27,782.40 from its claim. At paragraph 64 of the adjudication decision, the adjudicator has set out the amounts he has found due and which the parties acknowledge with costs and interest to be $68,050.62. As your client has paid $40,286.22 the balance of $27,782.40 remains owing and our client seeks the payment of these monies. Our client will not withdraw the statutory Demand. In relation to your client's alleged (unliquidated) offsetting claim, we are instructed that our client disputes that the Contract was properly terminated and further instructs that our client has an equal, if not greater counterclaim against your client. Be that as it may, our client's position is that your client's offsetting claim does not diminish your client's liability under the Adjudication Certificate and our client will not withdraw the Statutory Demand unless balance monies owing under the Certificate are paid. We await your client's response. There was a further letter then in response, sent the following day on behalf of Tesoro by Cooper Grace Ward: We are seeking instructions to apply to set aside the demand. We put you on notice that if we receive those instructions we will be making the application without any further reference to you. To avoid any argument that our client has not made its position completely clear, we respectfully note that the following points in response to your letter: We do not necessarily admit that our client's claim would be unliquidated. However, the point is irrelevant because "offsetting claims" for the purposes of s 459H can include claims for unliquidated amounts, particularly where there is evidence to substantiate the quantum of the claim in relation to the amount claimed in the statutory demand: see, eg Macleay Nominees Pty Ltd v Belle Property East Pty Ltd [2001] NSWSC 743 at [18] . The fact that your client claims to have "an equal, if not greater counterclaim against [our] client" is also irrelevant: (a) Section 459H(3) requires a consideration of whether the "substantiated amount" is below the prescribed minimum. (b) The "substantiated amount" equals the "admitted amount" minus the "offsetting total": s 459H(2). (c) The "admitted amount" here would be nil. We respectfully refer you to the various decisions which have held that a company can rely upon disputes in relation to a construction contract to offset a purported statutory demand based on a decision under the Building and Construction Industry Payments Act , including Max Cooper & Sons (Builders) Pty Ltd v M&E Booth & Sons Pty Ltd (2003) 212 ALR 680; Demir Pty Ltd v Graf Plumbing Pty Ltd [2004] NSWSC 553 at [15] - [22] ; Ozy Homewares Pty Limited v Wesgordon Pty Limited (2007) 25 ACLC 1 ,239. (d) However, for the purposes of discussing the irrelevance of your client's alleged counterclaim, we will assume that the Court does not accept that there is a genuine dispute about the amount outstanding in relation to the judgment certificate (ie that the "admitted amount" is $27,782.40). (e) The "offsetting total" is the total of any "offsetting claims": s 459H(2). An "offsetting claim: is a "genuine claim" that the company has against the respondent: s 459H(5). The genuineness of our client's claim is shown by the various correspondence exchanged in relation to the BCIP application, and by the expert reports referred to in our letter of 22 May 2009. (f) Therefore, even if your client did have a counterclaim which exceeded our client's offsetting claim (which is denied), and even if our client could not challenge the Adjudication Certificate, any alleged counterclaim by your client would be irrelevant because such counterclaim is not taken into account in calculating the "substantiated amount" for the purposes of s 459H. (g) Applying the substantiated amount formula referred to in sub-paragraph (b) above, the "substantiated amount" is the result of deducting the "offsetting total" (in the order of the $150,000) from the "admitted amount" (on the assumption set out in sub-paragraph (d) above, being $27,782.40). For those reasons, we maintain that your client has no legal basis to rely upon the demand. We will be relying upon this letter to make a submission that our client should have indemnity costs because your client's refusal to withdraw the demand was in wilful disregard of clearly established law and because your client's position is doomed to fail. We against request the trust account statement as requested in letter of 22 May 2009. It suffices to note that after this exchange of correspondence there was some further correspondence by Cooper Grace Ward that in the absence of any withdrawal of the demand, Tesoro was proceeding on the basis of having to institute proceedings for the setting aside of the demand. Those proceedings then were instituted, the application for the setting aside of the demand being accompanied by a comprehensive affidavit sworn by Benjamin Stephen Maggiolo, also filed on 11 June 2009. As it happens, after the application had been filed, further correspondence between the parties transpired. In particular, in a letter dated 24 June 2009 sent by Winchester Young & Maddern to Cooper Grace Ward, the following statement is made: Our client has instructed us to withdraw the statutory demand, and accordingly we hereby withdraw the statutory demand. In relation to the application, ie, the application to set aside the statutory demand, our client instructs us to propose that, "(a) Our client undertake to the court to institute proceedings in respect to the termination of the contract within 21 days after 26 June 2009; (b) the costs of the application be the costs in the cause of those proceedings; (c) the application be dismissed on commencement of the proceedings by our client." There was some concern on behalf of Tesoro by its solicitors about whether, having regard to the terms of that letter, there was an unequivocal or unconditional withdrawal of the statutory demand. It is perhaps moot whether that concern was necessary and in any event there can be no doubt now, having regard to the statement made in open court, that the statutory demand has been withdrawn and hence no longer exists. Of those New South Wales authorities it suffices, for present purposes, to refer to but one, namely, Demir Proprietary Limited v Graf Plumbing Proprietary Limited (2004) NSWSC 553 at [20] where Campbell J stated: Next, it was submitted that, if it were possible to rely upon an offsetting claim to set aside a statutory demand, the object of the [analogous New South Wales Act] would not be achieved. I do not accept that this is so. There are means of enforcement, short of a winding up action, which are open to a judgment creditor. When a judgment has been obtained pursuant to the analogous New South Wales Act, if the judgment debtor does not pay it voluntarily, then the judgment creditor can use the range of remedies open to a judgment creditor. It is not possible, however, for the terms of the Commonwealth Act, the Corporations Act 2001 (Cth) to be construed, or limited, by reference to the intention implicit in a State Act. The provisions of Div 3 of Pt 5.4 of the Corporations Act 2001 (Cth) set out a regime whereby a statutory demand to set aside whenever there is an offsetting claim, as defined. In the correspondence directed to Total Building Group by its solicitors, Tesoro, by its solicitors, at some length made reference to the New South Wales authorities. It further set out in a considered way why it was that Total Building Group ought not to resist the setting aside of the statutory demand or, at least, ought to withdraw it. In the face of that correspondence, the response made on behalf of Total Building Group was to assert or at least put in dispute that the underlying building contract was properly terminated and further to relay instructions that Total Building Group had an equal if not greater counterclaim against Tesoro. The latter phraseology in particular was, in my opinion, or at least ought to have been, pregnant with a realisation that the pressing further of the statutory demand was futile.


case_text: Re Chameleon Mining NL; Chameleon Mining ML v Atanaskovic Hartnell [2009] NSWSC 602 at [65] , Austin J had occasion to consider the question of whether or not to award costs in circumstances where a statutory demand fell for dismissal. His Honour observed: In a case such as this the court's discretion as to costs will be influenced by an examination of the conduct of the parties prior to the commencement of the proceedings, with a view to determining whether either party has acted unreasonably and has thereby brought about the need for the proceedings to be taken. Like Austin J in Chameleon Mining , I respectfully agree with the approach evident in the passage from White J's judgment in Soudan Lane . Total Building Group had the benefit of an adjudication in its favour under the Building and Construction Industry Payments Act . It also had the benefit, as a consequence of that Act, of being able to register that adjudication as a judgment of the District Court.


case_text: Soudan Lane Proprietary Limited v Glen Bradshaw [2007] NSWSC 772 , White J cited the well known observations of McHugh J in Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Quin [1997] HCA 6 ; (1997) 186 CLR 622 at 624-625 concerning the correct approach for a court to take on an application for costs where there has been no hearing on the merits. White J applied the principles stated by McHugh J to statutory demand proceedings in observations (at para 4 of Soudan Lane ) that I respectfully adopt: These principles are applicable to proceedings to set aside a statutory demand, but special features of such proceedings need to be taken into account in judging the reasonableness of the parties' conduct. A company faced with a statutory demand in relation to a debt, disputed in whole or in part, has no option but to commence an action under s 459G to set aside the demand within 21 days, even if the ultimate order sought will be an order under s 459H(4) varying the demand to the amount which is not genuinely in dispute. If a company were merely to pay the amount which was not genuinely in dispute, without securing or compromising the balance to the reasonable satisfaction of the creditor, it would face the prospect of winding up proceedings being brought against it, of its being presumed to be insolvent (s 459C(2)(a)) and of its being unable to oppose the winding up application on a ground upon which it could have relied for the purposes of an application to have the demand set aside unless leave is given (s 459S).


case_title: Soudan Lane Proprietary Limited v Glen Bradshaw (2007) NSWSC 772

case_text: Soudan Lane Proprietary Limited v Glen Bradshaw [2007] NSWSC 772 , White J cited the well known observations of McHugh J in Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Quin [1997] HCA 6 ; (1997) 186 CLR 622 at 624-625 concerning the correct approach for a court to take on an application for costs where there has been no hearing on the merits. White J applied the principles stated by McHugh J to statutory demand proceedings in observations (at para 4 of Soudan Lane ) that I respectfully adopt: These principles are applicable to proceedings to set aside a statutory demand, but special features of such proceedings need to be taken into account in judging the reasonableness of the parties' conduct. A company faced with a statutory demand in relation to a debt, disputed in whole or in part, has no option but to commence an action under s 459G to set aside the demand within 21 days, even if the ultimate order sought will be an order under s 459H(4) varying the demand to the amount which is not genuinely in dispute. If a company were merely to pay the amount which was not genuinely in dispute, without securing or compromising the balance to the reasonable satisfaction of the creditor, it would face the prospect of winding up proceedings being brought against it, of its being presumed to be insolvent (s 459C(2)(a)) and of its being unable to oppose the winding up application on a ground upon which it could have relied for the purposes of an application to have the demand set aside unless leave is given (s 459S). Like Austin J in Chameleon Mining , I respectfully agree with the approach evident in the passage from White J's judgment in Soudan Lane . Total Building Group had the benefit of an adjudication in its favour under the Building and Construction Industry Payments Act . It also had the benefit, as a consequence of that Act, of being able to register that adjudication as a judgment of the District Court. There was apparent from the correspondence which ensued prior to the filing of the application for the setting aside of the statutory demand on 11 June every reason, reasonably, to apprehend that the demand would be set aside. I have no doubt, having regard to the principles set out in the passage quoted from Soudan Lane , that this is a case where there ought to be an order for costs in favour of Tesoro on the dismissal of the application to set aside the statutory demand. The question is whether those costs should be awarded on an indemnity basis?


case_text: The above legal principles (and others) were conveniently set out by Weinberg J in Ace Contractors Staff Pty Ltd v Westgarth Development Ltd (1999) FCA 728 at [44] . 13 I have concluded that APM has failed to demonstrate that it is solvent, it having the burden to the requisite civil standard to prove solvency. I have reached this conclusion for a number of reasons. 14 In order to demonstrate solvency, reliance was finally placed by APM upon a report of James Edward Miller dated 30 August 2007, an expert accountant, who prepared a Balance Sheet and Profit and Loss Statement of APM as at 30 August 2007 and provided a report as to solvency as at 30 August 2007. 29 In addition to what I have concluded above, there are other matters which demonstrate that APM has not discharged the onus of proving solvency:- (i) APM has failed to comply with the statutory demand of the creditors, and that of a supply creditor, T & G Welding Pty Ltd. (ii) APM has been in default under mortgages over its property, and has no immediate or foreseeable capacity to service the mortgages. (iii) The application for winding up was made on 15 March 2007, over six months ago. On 18 June 2007, in the written submissions of APM, it was stated: [APM] is able to raise sufficient funds with which to pay for its short term creditors and it is anticipated that it will receive further funds in the near future from the sale of a properties [sic] . It is conceded that there are other further supporting creditors. [APM] will be able to use the funds that it is capable of raising and which it is anticipated of receiving in the near future with which to pay these debts. This has not eventuated despite the time lapse and there is no evidence to suggest that there will be sufficient funds to pay creditors in the near or reasonably near future. All the evidence relied upon by APM over recent months simply raised possibilities which have not eventuated. (iv) APM has been involved in disputes and legal proceedings with a number of people in addition to the Supreme Court proceedings mentioned above. The proceedings instituted already do not appear to be capable of resolution in the short term. (v) APM's books and records are incomplete and unsubstantiated. There have been a number of suggestions by APM since this matter was first heard to the effect that the new director Mr Fisher would take steps to put the books of accounts in order these suggestions have not been fulfilled and even Mr Miller in his report of 30 August 2007 necessarily relied upon incomplete and unsubstantiated records. (vi) No director can make a declaration of solvency. The then current directors of APM on 9 June 2006 resolved that APM was solvent as at that date, but this is obviously not sufficient to persuade me that the company was solvent at the date of hearing of this application. (vii) No cash flow statement or projections have been provided by APM despite ample opportunity to do so in these proceedings. (viii) There is no material to demonstrate that the company, in its attempts to refinance or obtain sufficient funding, will succeed in the foreseeable future or at all see Crema (Vic) Pty Ltd v Land Mark Property Developments (Vic) Pty Ltd (2006) 24 ACLC 889, at [172] per Dodds-Streeton J; Re Presha Engineering (Aust) Pty Ltd (1983) 1 ACLC 675 at 677 and Ace Contractors Staff Pty Ltd v Westgarth Development Ltd (1999) FCA 728 ;


case_text: In the event that I appointed a liquidator, it was submitted by the creditors that the liquidator be appointed as receiver of certain trust assets. In the appropriate case this could be ordered see ASIC v Eastlands Pty Ltd [2006] FCA 1702.


case_text: In my view, the appropriate approach is to appoint the liquidator who has power to administer any trust assets (at least at the early states) (see Crest Realty Pty Ltd (No 2) (in liquidation) (1977) 1 NSWLR 664 and Wells v Wily [2004] NSWSC 607) , and the liquidator can approach the Court if any problems arise. I would not think it desirable to separate the function of the liquidator and any receiver of the trust assets in this case, and these functions should (at least initially) be fulfilled by the same person. The liquidator may apply to the Court if his appointment needs to be extended to that of receiver of the trust assets or if he needs further assistance. Equally, if any conflict arises because of the appointment of Mr McCann to other companies associated to APM, he can apply to seek directions on how to deal with that conflict: see ASIC v Westpoint Corporation Pty Ltd (2006) 56 ACSR 646 at 652.


case_text: In Woodgate v Leonard [2007] NSWSC 495 , Barrett J said (at [37]): The jurisdiction discussed in these cases is an extraordinary and protective jurisdiction. It is separate from the jurisdiction involved in protection of confidential information and the enforcement of fiduciary duty. This is made clear, in particular, in the extract from the judgment of Whealy J just quoted. The concern is with the due and proper administration of justice in a proceeding before the court. The jurisdiction exists to ensure that the integrity of the proceeding is maintained. Identification of the means needed to maintain that integrity will, of course, depend on the nature of the proceeding and its likely course. See also Bahonko v Nurses Board of Victoria (No 3) [2007] FCA 491.


case_text: The above considerations were all matters I could take into account in considering whether it was in the interests of justice that the proceeding be re-opened: see Smith v New South Wales Bar Association (No 2) [1992] HCA 36 ; (1992) 176 CLR 256 at 266-267, per Brennan, Dawson, Toohey JJ and Gaudron JJ; Urban Transport Authority of NSW v Nweiser (1992) 28 NSWLR 471 at 478-479, per Clarke JA (with whom Mahoney and Meagher JJA agree); Londish v Gulf Pacific Pty Ltd (1993) 45 FCR 128 at 138-139, per Neaves, Bruchett and Ryan JJ; Nikoloski v Ridge Consolidated Pty Ltd (1994) 116 FLR 192, per Higgins J; Boucher v Australian Securities Commission (1996) 71 FCR 122 at 126 at 132, per Spender, Drummond and Merkel JJ; Hindmarsh Medical Clinic v Hindmarsh Family Practice Pty Ltd (1997) 38 IPR 616 at 631-632, per Mansfield J.


case_title: Browne v Dunn (1893) 6 R 67

case_text: I should indicate that Mr Miller was not cross-examined upon his report of 30 August 2007 by any of the creditors, supporting creditors or the Australian Securities and Investments Commission ('ASIC') (which was given leave to intervene in these proceedings). APM contended that in these circumstances, because of the rule in Browne v Dunn (1893) 6 R 67, I should ignore the criticisms made of his report, or give APM the opportunity to recall Mr Miller to address the criticisms. 25 I accept that the rule in Browne v Dunn (1893) 6 R 67 has an important function to play in the course of a trial, as recently made clear by the Full Court in Jardein Pty Ltd v Stathakis [2007] FCAFC 148 , at [27] to [33]: Where a party intends to contradict or challenge the testimony of an opposing party's witness, the party is obliged to put that witness on notice that his or her account will be challenged: Browne v Dunn (1893) 6 R 67. This gives the witness an opportunity to respond to the allegations. The reason this is done is as a matter of basic fairness. See Allied Pastoral Holdings Pty Ltd v Commissioner of Taxation [1983] 1 NSWLR 1 per Hunt J. Adherence to the rule in Browne v Dunn also gives the party calling the witness the chance to adduce supporting evidence which might not otherwise have been led. Compliance with the rule requires only that the substance of the contrary version is put to the witness, and not every detail of the challenge: White Industries (Qld) Pty Ltd v Flower & Hart (a firm) (1998) 156 ALR 169 at 217 per Goldberg J. In a civil case the consequences of a failure to observe the rule will vary. However, they will usually be related to the central object of the rule which is to secure fairness. In Seymour v Australian Broadcasting Commission (1977) 19 NSWLR 219 Mahoney JA said (at 236 237): "This kind of problem may arise at different times in the litigation. It may arise during the trial. Thus, where a party fails to cross-examine a witness at all or on a particular matter, it may be prudent for the trial judge at the time to draw the attention of counsel in an appropriate way to the effect this may have on the later conduct of the trial. It may be that the question arises at a later stage in the trial when counsel seeks to call evidence contradicting the witness or discrediting his evidence, or seeks to address upon the basis that the witness' evidence is untrue. The trial judge may then have to determine what course should be followed. Sometimes the interests of justice may be served by having the witness recalled for cross-examination. Sometimes the circumstances may be such that the only way in which justice can be achieved is by directing that, for example, it is not open to counsel, in address, to make such suggestion. What is to be done will depend, as I have said, upon the circumstances of the case." A possible consequence of a breach of the rule may be that the party in breach will be prevented from suggesting that the witness' testimony should be disbelieved. Another possible consequence will be the exclusion of evidence that challenges the witness' account with respect to those matters upon which there was no cross-examination. A third possible consequence will be to permit the witness to be recalled so that the breach can be remedied. One thing is clear. The rule is not simply to be ignored. The rule in Browne v Dunn has not been abrogated under the uniform Evidence Acts: Heaton v Luczka (unreported, New South Wales Court of Appeal, 3 March 1998) per Beazley JA. Indeed, s 46 of the Evidence Act 1995 (Cth) specifically enables the recall of a witness where there has been a breach of the rule and therefore implies its continued existence. 28 In any event, whilst I accept that the rule in Browne v Dunn may apply to expert testimony, there is no rule of law requiring that evidence not challenged in cross-examination be accepted. In this case, APM has an onus of proof to establish solvency. The legal approach to such a task is well established on the authorities. The real attack in this case was that Mr Miller's evidence as to solvency should not be accepted as it was based upon incomplete records and unsubstantiated source material, a mistaken approach to what needs to be shown to prove solvency, and the fact that the qualifications made to the report were such that the conclusion of "marginal" solvency could not be accepted by this Court. It seems to me that all a cross-examiner would have put to Mr Miller on this basis would be the very qualifications to his report Mr Miller himself acknowledged, which in themselves show his report of 30 August 2007 could not satisfy the Court as to solvency. APM and Mr Miller have not been unfairly treated. APM came to Court bearing the onus of proof as to solvency, but in my view has failed to provide the "fullest and best" evidence of its financial position.