Chisholm, Philip Anthony v The Official Trustee in Bankruptcy of the Estate of Killington, Gary Milton

[1998] FCA 1561

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SG 7196 of 1998

BETWEEN:	PHILIP ANTHONY CHISHOLM APPLICANT
AND:	THE OFFICIAL TRUSTEE IN BANKRUPTCY OF THE ESTATE OF GARY MILTON KILLINGTON RESPONDENT
JUDGE:	MANSFIELD J
DATE:	20 NOVEMBER 1998
PLACE:	ADELAIDE

REASONS FOR DECISION

HIS HONOUR:  I have given judgment in this matter today.  The parties are content to make submissions as to costs, but the party which sought leave to intervene has requested that the issue of costs be reserved to a later date.  I am not going to accede to their request.  That will simply increase the costs of the parties unnecessarily by a further significant attendance.  No good reason for being unable to deal with the costs of the application has been presented.  The parties have had a short time to consider the reasons for decision.

I will deal with the question of costs of the application now.

There are two applications.  One is on the part of the applicant for costs generally against the intervening parties, that is, Nedlands Pty Ltd (In Liquidation), and Mr Heywood-Smith the Liquidator, and also in part costs of the application against the Official Trustee.  The second application is the application by the Official Trustee against the applicant for his costs.

I bear in mind that, so far as I can determine, it was the liquidator of Nedlands,
Mr Heywood-Smith, who first raised the issue as to the need for an application for leave under s 58(3) of the Bankruptcy Act 1966 (Cth) for the applicant to pursue an appeal in relation to his desire to join the Official Trustee as a party to the Supreme Court proceedings. In the light of my findings and in the light of the nature of the allegations which the applicant has identified as those he seeks to pursue in the Supreme Court proceedings, it is a matter which was properly raised. Thereafter, it appears that collectively the parties took the view, under the prompting of the liquidator of Nedlands, as the material suggests, that the issue was a special federal matter as defined under s 3 of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth), and that therefore the Supreme Court should not deal with it.

I have made some observations at the completion of my reasons for decision which indicate that I do not now share that view.  Nevertheless, it was a view commonly accepted by the parties, about which there was no contrary argument, that the issue gave rise to a special federal matter which warranted this application being brought in this court.  The fact of the matter being brought in this court is not therefore a matter which I think should of itself be visited in costs upon any particular party.

I turn to consider the outcome of the application in relation to the respective positions of the parties and of Nedlands. In the case of the Official Trustee, at an early point he indicated an attitude to the application which in my view has been largely reflected in the reasons for decision and the orders which I propose to make. I am of the view that the applicant in pursuing the argument beyond that position sought to achieve, at least in one respect and possibly in more than one respect, an involvement of the Official Trustee in the Supreme Court proceedings which I have ruled is a result in respect of which I would not give leave to be pursued under s 58(3) of the Bankruptcy Act 1966.  In the case of Nedlands and Mr Heywood-Smith, they unsuccessfully sought to be joined as parties.  That application was opposed by the applicant.  They were given permission to make submissions.  In the course of events, those submissions were brief and, as my reasons show, did not influence the outcome of the application because the submissions made related to matters which I regarded as more appropriately the subject of consideration by the Supreme Court on the appeal.  I do not think the time taken on those submissions is sufficient to warrant a separate order for costs. 

The result is that the Official Trustee’s position against the applicant has largely been vindicated, but it was a position adopted only after these proceedings were commenced and the issues were first raised in the Supreme Court proceedings.  The Official Trustee attended briefly during the part heard appeal.  In addition, it has been a collective position of the parties that the application should be brought in this Court.  I do not think that in those circumstances that the full costs of the application should be imposed upon the applicant.

In my view, the appropriate orders for costs in all the circumstances is that the applicant should pay one half of the costs of the Official Trustee in Bankruptcy of the Estate of Gary Milton Killington to be taxed.  I do not make any other order for costs of the application.

I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Mansfield

Associate:

Dated:             20 November 1998

Counsel for the Applicant:	Mr T Gray QC with him Mr A Tokley
Solicitor for the Applicant:	Johnson Winter & Slattery
Counsel for the Respondent:	Mr G Gretsas
Solicitor for the Respondent:	Gretsas & Chrzaszaz
Date of Hearing:
Date of Judgment:	20 November 1998