Blacker & Blacker v NAB Ltd (2)
[2001] FMCA 8
•1 March 2001
FEDERAL MAGISTRATES COURT OF AUSTRALIA
Peter Raymond Blacker and Christine Blacker v National Australia Bank Limited [2001] FMCA 8
PRACTICE AND PROCEDURE – reopening of case after judgment – O.35 r.7(1) Federal Court Rules – discretion – matter reopened – no satisfactory reasons for extension of time to comply with Bankruptcy Notice advanced – application dismissed
CASES REFERRED TO
AB v FCT (1998) 157 ALR 510
MGHA Chemicals Pty Ltd (formerly Brackton Chemical Co Pty Ltd v State Rail Authority of NSW & Anor) (Supreme Court of NSW – Equity Division, unreported, Bryson J, April 1996)
Smith v NSW Bar Association [1992] 176 CLR 256
Urban Transport Authority of NSW v Mwieser [1992] 28 NSW LR 471
ApplicantPeter Raymond Blacker
Christine Blacker
Respondent: National Australia Bank Limited
File No:SZ176 of 2000
Delivered on: 1 March 2001
Delivered at: Sydney
Hearing Date: 1 March 2001
Judgment of: Raphael FM
REPRESENTATION:
Counsel for the Applicant: D McGovern
Solicitors for the Applicant: Commins Hendriks
Counsel for the Respondent: J E Thomson
Solicitors for the Respondent: Dibbs Crowther & Osborne
ORDERS:
1.Application dismissed.
2.Applicants to pay respondent’s costs.
IN THE FEDERAL MAGISTRATES COURT OF AUSTRALIA
REGISTRY
No SZ 176 of 2000
PETER RAYMOND BLACKER & CHRISTINE BLACKER
Applicants
and
NATIONAL AUSTRALIA BANK LIMITED
CAN 004 044 937
Respondent
REASONS FOR JUDGMENT
On 1 March 2001 I gave reasons for judgment on an application which I heard on 27 February 2001. That judgment (Peter Raymond Blacker and Christine Blacker v National Australia Bank Ltd [2001] FMC7) contained in paragraph 17 the following statement:
In this case the amended grounds of appeal which were considered by the Full Court do not seek to set aside the order under which the debtors were due to pay to the creditor the sum of $1,500,000.00 odd but to set aside those findings of his Honour which restricted the amount of the debtors’ cross-claims. Even if the debtors were entirely successfully it is submitted by the creditors that there would still be a substantial sum in excess of $500,000.00 owed to the respondent bank. This argument was not resisted by the applicants and perusal of the amended grounds of appeal would appear to confirm its accuracy.
2. There now comes before me a notice of motion by the respondent under Order 35 Rule 7 (1) of the Federal Court Rules as follows.
A.Details of Claim
On the grounds stated in the accompanying affidavit of Robert George Stone sworn 1 March 2001, the Applicants claim:
1. The setting aside of the judgment of Magistrate FM Raphael dated 1 March 2001 and in lieu thereof order that the time for compliance with Bankruptcy Notice 6422/00 be extended until 21 days after the pronouncing judgment by ther full Court of the Federal Court in the matter of Blacker v NAB Limited Proceedings number N723/00.
3. The short point made by Mr McGovern on behalf of the applicant was that paragraph 17 of my original judgment was factually incorrect and he should therefore be able to reopen the judgment pursuant to Federal Court Rules O35 r7(1).
4. Mr McGovern informed the Court that the Amended Grounds of Appeal to which my attention had been drawn at the hearing of the original application were not the Amended Grounds of Appeal that were finally before the Full Court. He advised that those grounds of appeal sought not just the payment to the applicants of some $850, 000 odd, but also the quashing of the original judgment in favour of the respondents, the result of which would be, if his clients were successful, that the bank would be paying to his clients $850, 000 odd and no money would be due to the bank. This is in stark contrast with the facts that appear in paragraph 17 of my judgment.
5. In support of his application Mr McGovern referred to AB vs FCT (1998) 157 ALR 510 where his Honour Foster J was faced with a similar request. After reviewing the authorities he said at p 516:
However, in my opinion, this does not mean that the jurisdiction conferred by O35 r7(1) must be regarded as so narrow or exceptional as to be virtually non-existent. Obviously each case must depend, ultimately, on its own facts. Clearly the jurisdiction is wider than that encompassed in Subrr (2) and (3). The jurisdiction may be exercised in circumstances going beyond “the slip rule” and can embrace circumstances where the Court, by heeding the admonition that the matter should be approached with all due caution, nevertheless is satisfied that a refusal to permit reopening would be unjust.
6. In his reply Mr Thomson argues that the information upon which I based paragraph 17 was contained in an affidavit of Mr Stone in support of the application, was referred to in his (Mr Thomson’s) submissions and was not denied by Mr Aitken at the hearing. Mr Thomson submitted that I could imply from those facts that the decision not to refer the Court to the second Amended Notice of Appeal was a forensic choice as opposed to an understandable mistake. He submitted that where a forensic decision had been taken the party was bound by that decision and the matter should not be reopened.
7. In MGHA Chemicals Pty Ltd (formerly Brackton Chemical Co Pty Ltd v State Rail Authority of NSW & Anor [Supreme Court of NSW – Equity Division unreported Bryson J April 1996]. His Honour reviewed a number of authorities including Smith v NSW Bar Association [1992 176 CLR 256] and in particular the joint judgment of Brennan, Dawson, Toohey and Gaudron JJ pp266-267 where their Honours said:
It is again necessary to distinguish between the considerations which may bear on a decision to reopen and the processes involved in reconsideration once a case has been reopened. If an application is made to reopen on the basis that additional evidence is available, it will be relevant, at that stage, to inquire why that evidence was not called at the hearing. If there was a deliberate decision not to call it ordinarily that will tell decisively against the application (Barker v Furlong (1891) Ch 172 at 184).
8. In Urban Transport Authority of NSW v Mwieser [1992] 28 NSW LR 471 Clarke J said:
The principle which will guide the Court in determining whether to grant an application for leave to reopen is whether the interests of justice are better served by allowing or rejecting the application as the case may be.
9. The tenor of Mr McGovern’s submissions seem to me to be that the decision not to refer to the Second Amended Notice of Appeal was an error which fell short of a forensic decision. However, he did not bring any evidence to support this.
10. It is clear from the judgment of Foster J in AB that a decision to reopen under O35r7(1) is discretionary and that the most important consideration is whether or not a refusal to permit a reopening would be unjust. I think that the Court should also have regard to the possible effect of a refusal to reopen particularly where it is clear that the Court appears on the face of the record to have made a decision based upon facts which are admittedly incorrect. These particular litigants have (quite reasonably) utilised all avenues available to them in the Federal Court system to debate their differences. It is not unreasonable for me to assume that if I declined to reopen the matter an appeal would immediately be lodged and further Court time would be utilised in debating whether or not I have rightly exercised my discretion. I believe that in the particular circumstances of this case where the statement I made in paragraph 17 of my judgment is accepted by all parties to have been incorrect, the balance of convenience and the interests of justice require me to reopen the matter and to hear the application.
11. Mr McGovern submits that with the knowledge of the new facts, namely that the appeal was heard on the basis that if successful in whole the judgment debtors would not owe any money to the bank and would indeed be paid a large sum of money by the bank, I should exercise my discretion to extend the time for compliance with the bankruptcy notice until after the judgment of the Full Court. He says that the fact that the Full Court heard the matter over three days of argument put by leading counsel shows this was a case where the Court should not be influenced by the fact that the merits of the appeal might be “slight” as in Bryant v Commonwealth Bank of Australia (unreported Federal Court, Full Court, 9 Nov 1994). I think that is a reasonable supposition to make.
12. Byron v Southern Star Group seems to me to make it clear that the existence of an arguable case on appeal is not sufficient in itself to warrant the type of relief now being requested. This is where Lehane J strongly disagreed with Kiefel J in Baker. In this case Mr McGovern has not produced any evidence of prejudice which might particularly affect these applicants, he has made no offer on behalf of these applicants of the type that might have been expected on an application for a stay, for example to pay some moneys into Court or otherwise secure the respondent’s judgment. Nor has he satisfactorily repudiated the respondent’s argument that some possible preferences may already have been given.
13. In answer to a question from me Mr Thomson confirmed that the undertaking which his clients had given not to proceed with an application for a sequestration order pending the result of the appeal was still on foot. In the light of this concession and those matters raised in this judgment I am of the view that the new facts revealed to me this morning do not and should not change the decision which I made yesterday to dismiss the debtor’s application for an extension of time to comply with the bankruptcy notice.
14. I dismiss the application. I order that the applicants pay the respondents costs.
I certify that the preceding fourteen (14) paragraphs are a true copy of the reasons for judgment of Raphael FM.
Associate
Dated 1 March 2001
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