Bates v Bechara (No 2)

[2017] FCCA 985

FEDERAL CIRCUIT COURT OF AUSTRALIA

BATES v BECHARA (No.2) [2017] FCCA 985

Catchwords:
BANKRUPTCY – Creditor’s petition – sequestration order made by the Registrar.

PRACTICE & PROCEDURE – Application in a Case to reinstate – previous Application in a Case dismissed for non-appearance and lack of due diligence in prosecution of the application – consideration of factors – application dismissed.

Legislation:

Federal Circuit Court Rules 2001 (Cth) rr.16.05, 13.03B, 13.03B

Cases cited:

Bates v Bechara [2016] FCCA 3489

Applicant: PHILIP BATES

Respondent: MARIA BECHARA

File Number: SYG 821 of 2016

Judgment of: Judge Nicholls

Hearing date: 3 March 2017

Date of Last Submission: 3 March 2017

Delivered at: Sydney

Delivered on: 3 March 2017

REPRESENTATION

Solicitors for the Applicant: Bannister Law

Solicitors for the Respondent: State Lawyers

ORDERS

1. The Application in a Case made on 5 January 2017 is dismissed.

2. The applicant pay the respondent’s costs set in the amount of $1200.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 821 of 2016

PHILIP BATES

Applicant

And

MARIA BECHARA

Respondent

REASONS FOR JUDGMENT

(Ex Tempore; Revised from Transcript)

1. I have before me today an Application in a Case (“AIC”) made by Ms Maria Bechara (“the applicant” in the AIC) [a reference in the orders to the applicant is a reference to Ms Bechara] on 5 January 2017. She seeks orders that, in effect, request reinstatement of an application made to this Court on 25 July 2016. That application sought to have set aside a sequestration order made by a Registrar of the Court on 5 July 2016, and dismissal of a creditor’s petition. Mr Philip Bates (“the respondent” in the AIC) was the petitioning creditor.

2. The “substantive” application made on 25 July 2016 was ultimately set down for hearing on 8 December 2016. This was preceded by two occasions where adjournments were granted on two Court events, 17 August 2016 and 27 September 2016. On 8 December 2016, there was no appearance by, or on behalf of, Ms Bechara. I dismissed that application pursuant to two Rules of this Court (Bates v Bechara [2016] FCCA 3489).

3. One was r.13.03C(1)(c) of the Federal Circuit Court Rules 2001 (Cth) (“the FCC Rules”). I was satisfied that Ms Bechara had not attended, and no one had attended on her behalf, and was further satisfied that she had had reasonable notice of the Court event. Notwithstanding that, Ms Bechara chose, through her then solicitors to send an ex parte email to the Court on 29 November 2016, setting out why she was not going to attend the Court event on 8 December 2016. I was not satisfied that that was a reasonable or satisfactory explanation for her

   
   

   non-appearance. I was also satisfied that the application should be dismissed pursuant to r.13.03B(1)(a) of the FCC Rules for breach of the Court’s orders and failure to prosecute the application with due diligence.

4. Since that time, and as set out above, Ms Bechara filed the AIC on 5 January 2017.  On 22 February 2017, the matter came before me for directions. Mr Bentley from State Lawyers appeared for Ms Bechara. The AIC was set down for hearing today. The AIC was set down for hearing on 3 March 2017.

5. When the matter was called today, there was an appearance on behalf of Mr Bates, and for Ms Bechara. The same firm of solicitors who appeared for Ms Bechara on 22 February 2017 again appeared (State Lawyers). An adjournment of the hearing of the AIC was requested by Ms Bechara through her representatives. Written submissions were presented. The submissions describe that the address for service is that of Ms Bechara’s former solicitors. The Court was advised that if an adjournment was granted, that on the next occasion, the solicitors who had previously represented Ms Bechara (TressCox), and who had withdrawn, were going to come back “onto the record”, and would attend on her behalf at the hearing of the AIC (for background see Bates v Bechara [2016] FCCA 3489) at [1]).

6. In essence, the Court was advised they had now formally filed to withdraw their representation. The submissions handed up in Court today indicate that the address for service for Ms Bechara is now Matthew Payne of TressCox Lawyers (Ms Bechara’s former solicitor). There was no explanation as to why he was not here today to pursue this matter for Ms Bechara. 

7. I have no reason to find that the solicitors who did appear for Ms Bechara today did not properly convey to Ms Bechara, for whom they acted at the time, what had occurred in Court on 22 February 2017. I find that they would have communicated this to her consistent with their duties arising from acting for her.

8. There are a number of points that need to be taken into account in relation to the AIC. First and foremost, this is, and as Ms Bechara’s written submissions acknowledge, an application made pursuant to r.16.05 of the FCC Rules, in effect seeking that an order that is made in the absence of a party that is, r.16.05(2)(a) of the FCC Rules, be set aside.

9. The submissions, and it is interesting that this is “pleaded by way of submission”, rather than in the proper way, also seek to press r.16.05(2)(c) of the FCC Rules, that the orders made on 8 December 2016 were interlocutory. There is no dispute that that is the case with orders made pursuant to r.13.03C(1)(c) of the FCC Rules. However, there is some dispute about whether the orders that I made in dismissing Ms Bechara’s application on the basis of want of prosecution with due diligence, or failure to comply with the Court’s orders, can properly be characterised as an order that is interlocutory. I say this given that this was an order that “finally determined” the matter between the parties.

10. Nonetheless, I proceed today on the basis that this is an application made pursuant to r.16.05(2)(a) of the FCC Rules. That is, that both the orders were made in the absence of Ms Bechara.

11. It is the case that the Court does have the discretion to set aside or vary orders made in the absence of a party. The elements, or factors, relevant to the exercise of that discretion are non-exhaustive. However, in my view, given the circumstances of this case, three elements or factors emerge for immediate consideration. 

12. One is whether there is merit in the original “substantive” application (that is, the AIC made on 25 July 2016), such that the interests of justice call for that meritorious matter to be aired at a final hearing. This is what Ms Bechara calls for in her submissions.

13. The difficulty for Ms Bechara is that she has never articulated her case.  The application filed on 25 July 2016, which was dismissed, as I said earlier, pursuant to two Rules of this Court, state that the “orders” made by Registrar Tesoriero on 5 July 2016 be set aside.  This is the sequestration order. The application also included that Mr Bates’ creditor’s petition dated 7 April 2016, be dismissed.  There is nothing in that application to indicate the grounds upon which the Court should move to make the orders sought. Nor was any evidence filed to satisfactorily explain that application. 

14. What appears to have escaped Ms Bechara’s attention in her written submissions is that there were a number of subsequent opportunities, and orders made by the Court, giving her the opportunity to address what I have described as the important deficiencies in the conduct of the application that she had made.  It may be that Ms Bechara needs to focus on the fact that her “substantive” application was not just dismissed for want of appearance.  It was dismissed for want of prosecution and her failure to comply with Court orders.  Court orders which were directed to the issue of enabling her to set out her case.

15. What is left is an AIC which itself is deficient given the absence, both of itself, and in the supporting documentation that has been provided, of any satisfactory explanation of the merits of the case she now seeks to reinstate. 

16. It must also be said, that the submissions that have been handed up today are absent any outline of what the arguable case Ms Bechara says needs to be heard by the Court. There is also no indication of the case that Ms Bechara seeks to put before the Court. Ms Bechara has had, in my view, a more than reasonable opportunity, and a reasonable length of time, including with her AIC, to prepare for the hearing of that application and to articulate, or even at least outline, the case that she wishes to pursue at a hearing. There is nothing before the Court to indicate what that case may be. On that basis, I cannot find that there is any merit in that original “substantive” application such that it calls for its reinstatement in the interests of justice.

17. It is not in the interests of justice to re-open this matter simply to create a further delay in the disposition of the original application that Ms Bechara put before the Court. 

18. It is in this sense that I come to the second element. That is, prejudice to Mr Bates.  It is clear that Ms Bechara has a right to pursue matters in the Court. If she has a case to be heard, then she is entitled to have an opportunity to put that case.  Mr Bates has, equally in my view, a reasonable expectation that if Ms Bechara has been given a reasonable opportunity to articulate that case, and repeatedly fails to do so, then any further extension, or delay, is prejudicial to him. I am not persuaded, in the circumstances, that this is a prejudice that can be addressed only by the matter of costs.  That is because, and it cannot be forgotten, that the order that the Registrar made was a sequestration order. There are obvious consequences that flow from the very nature and character of such an order.

19. The third element is whether Ms Bechara has provided any explanation for the way in which her matter has come before the Court today.  I thank Mr Hermiz who attended and acted to the extent of his instructions.  I accept his role today is limited to the instructions that he received. But there is nothing that has been put before the Court today that causes me to find that I can be satisfied that any further time should be granted to Ms Bechara in the sense of re-opening her case that was dismissed on the previous occasion. She already has had a reasonable and fair opportunity to present her case. 

20. As mentioned previously, Ms Bechara has had the opportunity to present her case.  Nothing that has been put before me provides a satisfactory explanation as to why, today, she was not in a position to properly outline her argument.  I note that in the submissions, reference has been made to former solicitors coming onto the record.  I also note that I was told on 22 February 2017 by a solicitor from State Lawyers, not with TressCox (Ms Bechara’s former solicitors), who appeared for Ms Bechara on that date, that her former solicitors would be coming “onto the record” and the expectation was that they would appear here today. 

21. I am satisfied that the solicitor who did appear for Ms Bechara on that day would have properly discharged his obligation to his client and informed her of what had occurred in Court on that day. I am satisfied that she would have had reasonable notice of the Court event today.  There has been no appearance by her former solicitor.  To my knowledge they have not even gone “on the record” in any way. 

22. I cannot be satisfied that there is any prospect that even if Ms Bechara’s case were to be re-opened today, that is, if the AIC were to be granted, that Ms Bechara would pursue the substantive application with the required diligence. This is particularly in light of the fact that not only has she shown no due diligence in the prosecution of that matter up until the dismissal of the application, but has continued with the same lack of impulsion, and due diligence since that time, including in her conduct in relation to this AIC.

23. I also note that the orders sought by the applicant today by way of the written submissions appear to allege bias or the reasonable apprehension of bias on the part of the Court. It appears that the submission is that I cannot bring an unbiased mind to determining the applicant’s “substantive” application because of the orders I made on the previous occasion. That is, I should disqualify myself from “case management” and/or the hearing of the substantive application. 

24. I do not need to consider the first matter because for the reasons that I have given, I am not minded to make the orders that the applicant seeks in reinstating her case. Further, the orders made on the previous occasion were reasonably open to the Court on what was before it. In the absence of any other factor, Ms Bechara’s allegation is baseless.

25. I also further note, that in the alternative to order 3, again, this is done by way of submission and not in any proper way, the submissions state:

    “If Judge Nicholls is not minded to grant the orders sought by the Applicant, the Applicant respectfully seeks an order that the Applicant serve and file an application in a case and an affidavit seeking to have Judge Nicholls disqualified from hearing the application.” 

26. I am not minded to grant the orders sought by the applicant and I am not minded to make the order granting leave to file and serve an AIC. In the circumstances I take the view that this is another example of Ms Bechara’s conduct of seeking to delay the progress of her own “application”. 

27. It must also be said it is entirely not clear what Ms Bechara is asking the Court to do. Whether this is an expression of an intention to appeal from whatever orders I make today if they are unfavourable to her, or whether it is an expression of an intention to keep coming back to this Court to prosecute the case which she has failed to prosecute with due diligence for some time now. In any event, clarification of her position is a matter for Ms Bechara, and a matter to be dealt with if, and when, any such application is made to the Court.

28. That deals with the written submissions.  I should also note the affidavit material which has not been read into evidence. I indicated earlier that I would treat this material as submissions.  This material seeks, in part, to re-agitate matters that were considered by the Court on 8 December 2016. To the extent that those matters have already been determined there is nothing further of substance put in here that I have not already addressed.

29. For these reasons the AIC made on 5 January 2017 should be dismissed. I will make the appropriate orders.

I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of Judge Nicholls

Date: 17 May 2017