Craven v Ready Flowers Pty Ltd - [2015] FCA 297

FEDERAL COURT OF AUSTRALIA
Craven v Ready Flowers Pty Ltd [2015] FCA 297

Citation: Craven v Ready Flowers Pty Ltd [2015] FCA 297

Appeal from: Application for extension of time: Craven v Ready Flowers Pty Ltd & Anor [2012] FMCA 1128

Parties:
GORDON CRAVEN v READY FLOWERS PTY LTD ACN 115 489 480

READY FLOWERS PTY LTD ACN 115 489 480 v GORDON CRAVEN

File numbers: QUD 156 of 2014
QUD 251 of 2014

Judge: LOGAN J

Date of judgment: 5 March 2015

Catchwords:
BANKRUPTCY AND INSOLVENCY – where applicant applied for an extension of time to seek leave to appeal from an interlocutory judgment of the Federal Magistrates Court of Australia – application for leave to appeal dismissed with costs – order for costs as taxed forms basis for bankruptcy notice – whether the circumstances warrant the exercise of the Court’s discretion under s 52(2) of the Bankruptcy Act 1966 (Cth) to not accept the Federal Court’s costs order as proof of the debt concerned and therefore not make a sequestration order against applicant’s estate – whether director of the respondent gave false evidence before the Federal Magistrates Court and perpetuated a fraud on the Federal Court such as to amount to a perversion of the course of justice – alleged deliberate omission of evidence as to payment arrangements between respondent and entity to whom the respondent’s business was sold – whether leave application before this Court determined on a premise known by the respondent to be false – whether fraud proved on the balance of probabilities

Held: fraud and perversion of justice not proved – costs judgments was evidence of debt in reality – sequestration order made

CONSTITUTIONAL LAW – parliamentary privilege – evidence on which applicant sought to rely included right of reply statement given by director’s wife to the Australian Senate subject to parliamentary privilege under s 16 of the Parliamentary Privileges Act 1987 (Cth) – statement inadmissible as its use would impeach a question of proceeding in Parliament

Legislation: Bankruptcy Act 1966 (Cth) ss 40, 52
Evidence Act 1995 (Cth) s 140
Parliamentary Privileges Act 1987 (Cth) s 16
Bankruptcy Act 1883 (UK) s 7
Bill of Rights 1688 (UK) Art 9

Cases cited: Briginshaw v Briginshaw (1938) 60 CLR 336 considered
Craven v Ready Flowers Pty Ltd & Anor [2012] FMCA 1128 cited
Craven v Ready Flowers Pty Ltd [2013] FCA 1308 cited
Craven v Ready Flowers Pty Ltd [2014] FCA 467 cited
Craven v Ready Flowers Pty Ltd [2014] FCA 693 cited
Craven v Ready Flowers Pty Ltd [2014] FCA 865 cited
Makhoul v Barnes (1995) 60 FCR 572 applied
McDonald v McDonald (1965) 113 CLR 529 applied
Petrie v Redmond (1943) St RQd 71 cited
Re Flautau; ex parte Scotch Whisky Distillers Limited (1888) 22 QBD 83 applied
Re Lennox [Ex parte Lennox] (1885) 16 QBD 315 applied
Simon v Vincent J O’Gorman Pty Ltd (1979) 41 FLR 95 considered
Wren v Mahony (1972) 126 CLR 212 considered

Date of hearing:

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] FCA 297
Decision Date: 5 March 2015

CaseChat Overview and Summary

Gordon James Craven sought an extension of time to appeal an interlocutory judgment from the Federal Magistrates Court of Australia. The respondent, Ready Flowers Pty Ltd, opposed the application, asserting that Mr Craven's application was dismissed with costs. The costs awarded formed the basis for a bankruptcy notice issued to Mr Craven. Mr Craven applied for the court to exercise its discretion under section 52(2) of the Bankruptcy Act 1966 (Cth) to not accept the Federal Court's costs order as proof of the debt concerned, thereby preventing a sequestration order against his estate. He argued that the director of Ready Flowers had provided false evidence in the Federal Magistrates Court, perpetuated a fraud on the Federal Court, and deliberately omitted evidence regarding payment arrangements between the respondent and the entity to whom the respondent's business was sold.

The court examined whether the circumstances warranted the exercise of its discretion under section 52(2) of the Bankruptcy Act to disregard the costs order as evidence of the debt. It also considered whether fraud and perversion of justice were proven, and whether the leave application before the court was determined on a premise known by the respondent to be false. The court held that the fraud and perversion of justice were not proven, and that the costs judgments were evidence of the debt in reality.

In light of the findings, the court dismissed Mr Craven's application and ordered him to pay the respondent's costs of the proceedings. Subsequently, the court made a sequestration order against Mr Craven's estate, and ordered that the applicant creditor's costs be taxed and paid from the respondent debtor's estate in accordance with the Bankruptcy Act 1966 (Cth). The date of the act of bankruptcy was noted as 2 May 2014.

Orders

Orders of the court

1. The application be dismissed.

2. The applicant pay the respondent’s costs of the proceedings.

NOTE: These orders were made prior to the making of the sequestration order in proceeding QUD 251 of 2014.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

1. A sequestration order be made against the estate of Gordon James Craven.

2. The applicant creditor’s costs be taxed and paid from the estate of the respondent debtor in accordance with the Bankruptcy Act 1966 (Cth).

The Court notes that the date of the act of bankruptcy is 2 May 2014.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citation:	Craven v Ready Flowers Pty Ltd [2015] FCA 297
Appeal from:	Application for extension of time: Craven v Ready Flowers Pty Ltd & Anor [2012] FMCA 1128
Parties:	GORDON CRAVEN v READY FLOWERS PTY LTD ACN 115 489 480 READY FLOWERS PTY LTD ACN 115 489 480 v GORDON CRAVEN
File numbers:	QUD 156 of 2014 QUD 251 of 2014
Judge:	LOGAN J
Date of judgment:	5 March 2015
Catchwords:	BANKRUPTCY AND INSOLVENCY – where applicant applied for an extension of time to seek leave to appeal from an interlocutory judgment of the Federal Magistrates Court of Australia – application for leave to appeal dismissed with costs – order for costs as taxed forms basis for bankruptcy notice – whether the circumstances warrant the exercise of the Court’s discretion under s 52(2) of the Bankruptcy Act 1966 (Cth) to not accept the Federal Court’s costs order as proof of the debt concerned and therefore not make a sequestration order against applicant’s estate – whether director of the respondent gave false evidence before the Federal Magistrates Court and perpetuated a fraud on the Federal Court such as to amount to a perversion of the course of justice – alleged deliberate omission of evidence as to payment arrangements between respondent and entity to whom the respondent’s business was sold – whether leave application before this Court determined on a premise known by the respondent to be false – whether fraud proved on the balance of probabilities Held: fraud and perversion of justice not proved – costs judgments was evidence of debt in reality – sequestration order made CONSTITUTIONAL LAW – parliamentary privilege – evidence on which applicant sought to rely included right of reply statement given by director’s wife to the Australian Senate subject to parliamentary privilege under s 16 of the Parliamentary Privileges Act 1987 (Cth) – statement inadmissible as its use would impeach a question of proceeding in Parliament
Legislation:	Bankruptcy Act 1966 (Cth) ss 40, 52 Evidence Act 1995 (Cth) s 140 Parliamentary Privileges Act 1987 (Cth) s 16 Bankruptcy Act 1883 (UK) s 7 Bill of Rights 1688 (UK) Art 9
Cases cited:	Briginshaw v Briginshaw (1938) 60 CLR 336 considered Craven v Ready Flowers Pty Ltd & Anor [2012] FMCA 1128 cited Craven v Ready Flowers Pty Ltd [2013] FCA 1308 cited Craven v Ready Flowers Pty Ltd [2014] FCA 467 cited Craven v Ready Flowers Pty Ltd [2014] FCA 693 cited Craven v Ready Flowers Pty Ltd [2014] FCA 865 cited Makhoul v Barnes (1995) 60 FCR 572 applied McDonald v McDonald (1965) 113 CLR 529 applied Petrie v Redmond (1943) St RQd 71 cited Re Flautau; ex parte Scotch Whisky Distillers Limited (1888) 22 QBD 83 applied Re Lennox [Ex parte Lennox] (1885) 16 QBD 315 applied Simon v Vincent J O’Gorman Pty Ltd (1979) 41 FLR 95 considered Wren v Mahony (1972) 126 CLR 212 considered
Date of hearing: