Davies v Stewart

Case [2024] FCA 249

FEDERAL COURT OF AUSTRALIA

Davies v Stewart [2024] FCA 249

File number: WAD 166 of 2023
Judgment of: BANKS-SMITH J
Date of judgment: 15 March 2024
Catchwords: ADMINISTRATIVE LAW - application for review of decision made by Registrar of the Federal Court of Australia - where Registrar refused to accept documents for filing pursuant to r 2.26 of the Federal Court Rules 2011 (Cth) - where applicant seeks to set aside perfected judgment for fraud - whether Registrar had proper regard to relevant law - decision set aside
Legislation:

Administrative Decisions (Judicial Review) Act 1977 (Cth) ss 5, 16

Federal Court Rules 2011 (Cth) rr 2.26, 4.01, 8.05, 16.42, 16.43, 39.05
Cases cited:

Clone Pty Ltd v Players Pty Ltd (In Liquidation) (Receivers & Managers Appointed) [2018] HCA 12; (2018) 264 CLR 165

Commissioner of Taxation v Rawson Finances Pty Ltd [2023] FCA 617

Davies v Lazer Safe Pty Ltd [2018] FCA 702

Davies v Lazer Safe Pty Ltd [2019] FCAFC 65

Frigger v Trott [2021] FCA 18

Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563

Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd (No 2) (1992) 37 FCR 234

Nyoni v Murphy [2018] FCAFC 75; (2018) 261 FCR 164

Patch v Ward (1867) LR 3 Ch App 203

Reaper v Luxton [2017] FCA 949

Satchithanantham v National Australia Bank Limited [2010] FCAFC 47

Spalla v St George Motor Finance Ltd (No 5) [2004] FCA 1262

SZVCP v Cho [2017] FCA 310; (2017) 250 FCR 225

Termi-Mesh Australia Pty Ltd v Josu Manufacturing Pty Ltd [1999] FCA 1241

Wu v Avin Operations Pty Ltd (No 2) [2006] FCA 792
Division: General Division
Registry: Western Australia
National Practice Area: Administrative and Constitutional Law and Human Rights
Number of paragraphs: 26
Date of hearing: 12 March 2024
Counsel for the First Applicant: The first applicant is self-represented
Counsel for the Second Applicant: The second applicant is unrepresented
Counsel for the Respondent: The respondent filed a submitting notice save as to costs

ORDERS

WAD 166 of 2023
BETWEEN:

KEVIN STEPHEN DAVIES

First Applicant

TRICLOPS TECHNOLOGIES PTY LTD (ACN 117 350 464)

Second Applicant
AND:

REGISTRAR STEWART

Respondent

ORDER MADE BY:

BANKS-SMITH J

DATE OF ORDER:

15 MARCH 2024

THE COURT ORDERS THAT:

1.Pursuant to s 16(1)(a) of the Administrative Decisions (Judicial Review) Act 1977 (Cth), the decision of the respondent notified in his letter of 20 June 2023 to the applicants is set aside with effect from the date of this order.

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


REASONS FOR JUDGMENT

BANKS-SMITH J:

  1. This is an application by Mr Davies, purportedly in his own right and on behalf of Triclops Technologies Pty Ltd, for review of a decision of a Registrar of this Court to refuse to accept certain documents for filing.  The Registrar has filed a submitting notice.

  2. Rule 2.26 of the Federal Court Rules 2011 (Cth) provides as follows:

    Refusal to accept document for…

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Details
AGLC
Davies v Stewart [2024] FCA 249
Case
[2024] FCA 249
Decision Date

CaseChat Overview and Summary

The matter of Davies v Stewart involved an application by the applicant to review a decision made by the Registrar of the Federal Court of Australia. The Registrar had refused to accept documents for filing, pursuant to rule 2.26 of the Federal Court Rules 2011 (Cth). The applicant sought to set aside a perfected judgment for fraud and claimed that the Registrar had not properly considered the relevant law. The legal issues before the court were whether the Registrar had appropriately exercised his discretion and whether the court had the inherent equity jurisdiction to set aside a perfected judgment for fraud.

In addressing the issues, the court considered the principles outlined in Clone Pty Ltd v Players Pty Ltd (In Liquidation) (Receivers & Managers Appointed) [2018] HCA 12; (2018) 264 CLR 165, which established the High Court's authority on setting aside a judgment on the basis of fraud. The court noted that the power to set aside a judgment for fraud requires actual fraud, which involves a meditated and intentional contrivance to keep the parties and the court in ignorance of the real facts of the case and obtaining the orders by that contrivance. The court also acknowledged that serious malpractice by a party's lawyers would not suffice, nor would accident, surprise, mistake, or a lack of frankness alone. The court found that the Registrar had not properly considered the relevant law and had failed to exercise the discretion conferred by the relevant rules. The decision of the Registrar was set aside.

The court's decision was grounded in the principles of administrative law and the inherent equity jurisdiction of the Federal Court of Australia. The Registrar's decision to refuse to accept the documents for filing was found to be in error, and the court exercised its power to set aside the decision. The court's order set aside the Registrar's decision with effect from the date of the order, allowing the applicant to proceed with their application to set aside the perfected judgment for fraud. The court's decision underscores the importance of ensuring that the relevant law is properly considered when exercising discretion and highlights the court's inherent equity jurisdiction to set aside a perfected judgment for fraud.

Orders

Orders of the court

1. Pursuant to s 16(1)(a) of the Administrative Decisions (Judicial Review) Act 1977 (Cth), the decision of the respondent notified in his letter of 20 June 2023 to the applicants is set aside with effect from the date of this order.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

The application is said to be brought pursuant to r 39.05 of the Rules 'and/or the inherent equity jurisdiction of the Federal Court of Australia per [s] 5(2) of the Federal Court of Australia Act 1976 (Cth)'.Proceedings to set aside judgment on the basis of fraud Rule 39.05(b) provides that the Federal Court may set aside or vary any judgment or order after it has been entered if it was 'obtained by fraud'. More generally, the Court retains the equitable jurisdiction to set aside a perfected judgment outside a statutory appeal where there has been actual fraud. The scope of this power was the subject of the High Court's decision in Clone Pty Ltd v Players Pty Ltd (In Liquidation) (Receivers & Managers Appointed) [2018] HCA 12; (2018) 264 CLR 165. As the High Court confirmed, a party that wishes to impeach a judgment on the ground of fraud may institute independent proceedings for that purpose. The decision in Commissioner of Taxation v Rawson Finances Pty Ltd [2023] FCA 617 (Perry J) is an example of such a proceeding. The following summary of the principles can be extracted from her Honour's reasons at [57]‑[78]:(a)it is generally appropriate for a party wishing to impeach a judgment on the ground of fraud to institute independent proceedings for that purpose (Clone at [32]);(b)an action to set aside an earlier judgement for fraud is not a procedural application but a cause of action;(c)the power to set aside a judgment on the ground of fraud requires actual fraud, reflecting the public interest in the finality of litigation;(d)the fraud must be actual positive fraud, a meditated and intentional contrivance to keep the parties and the Court in ignorance of the real facts of the case and obtaining the orders by that contrivance (Clone at [55], [69], approving relevantly Patch v Ward (1867) LR 3 Ch App 203 at 212‑213);(e)serious malpractice by a party's lawyers would not suffice, and nor would accident, surprise, mistake or a lack of frankness alone (Clone at [55], [57]);(f)as the essence of the action is fraud, it 'must be pleaded distinctly and with particularity and clearly proved' (Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563 at 573; Clone at [62]; and r 16.42 of the Rules);(g)where a condition of mind such as a fraudulent intention is alleged as part of the fraud, this must also be properly particularised (r 16.43 of the Rules); and(h)to the extent decisions such as Spalla v St George Motor Finance Ltd (No 5) [2004] FCA 1262 at [61] and Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd (No 2) (1992) 37 FCR 234 suggested that there was a requirement that the evidence relied upon to set aside an earlier decision for fraud could not have been discovered by the time of the trial with reasonable diligence, they are to be read subject to Clone (at [63]‑[68]) and do not represent the current position of the authorities. I would add to her Honour's references to Clone the following paragraph from the High Court's reasons, as it highlights the significance of the issue:[63]The second ground of appeal raised the issue of whether there is a further precondition requiring an applicant who seeks to set aside a judgment for fraud to establish that reasonable diligence was taken prior to the judgment to discover the fraud. Such a requirement is not present in other areas of the law concerned with fraud. As Brennan J said in Gould v Vaggelas [(1984) 157 CLR 215 at 252], '[a] knave does not escape liability because he is dealing with a fool'. The effect of such a requirement would be that a judgment might be set aside for a less serious, but well concealed, fraud but the judgment could never be set aside for an extremely serious but brazen fraud that could reasonably have been detected.The other documents - statement of claim and affidavit

Ratio Decidendi

Legal Principle Established

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