Dubs v Rahman
[2012] FMCA 664
•19 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| DUBS v RAHMAN | [2012] FMCA 664 |
| PRACTICE AND PROCEDURE – Application to transfer matter to Federal Court or High Court on grounds of no jurisdiction – whether court has jurisdiction – where application to disqualify on grounds of apprehended bias – where orders made for submissions to be clarified – whether to disqualify – where applicant overseas – whether to waive complete compliance with R.4.06 of Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth). CONSTITUTIONAL LAW – Judicial power – whether Federal Magistrates Court has power to make findings in relation to constitutional matters – whether issuance of Bankruptcy Notice a judicial act – whether Official receiver has power to issue Bankruptcy Notice – where Bankruptcy notice based on judgment of state court – whether sequestration order may be made by a federal court. BANKRUPTCY – Creditors petition – whether change of solicitors’ firm name affects proceedings – whether Bankruptcy Notice served – where application to appeal judgments upon which Bankruptcy Notice founded – where judgments result of costs assessment process – whether respondent has an arguable case – whether to adjourn – whether to make sequestration order. |
| Bankruptcy Act 1966 (Cth) ss.41, 52 Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth) Federal Magistrates Act 1999 (Cth) Judiciary Act1903 (Cth) ss.23, 72, 78 Commonwealth of Australia Constitution Act Legal Profession Act 2004 (NSW) |
| Capital Finance Australia Ltd v Vellar [2012] FMCA 285 Australian Litigation Fund Pty Ltd v Mearns (No.3) [2005] FMCA 1870 Re Refugee Review Tribunal; Ex parte H (2001) 179 ALR 425 Re Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245 |
| Applicant: | ROSALIND V DUBS |
| Respondent: | MOHAMMAD TABIBAR RAHMAN |
| File Number: | SYG 922 of 2012 |
| Judgment of: | Raphael FM |
| Hearing date: | 19 July 2012 |
| Date of Last Submission: | 19 July 2012 |
| Delivered at: | Sydney |
| Delivered on: | 19 July 2012 |
REPRESENTATION
| Solicitors for the Applicant: | Norton Rose |
| For the Respondent: | In person |
ORDERS
Compliance with R.4.06 of the Federal Magistrates Court (Bankruptcy) Rules 2006 be effected by the filing of an affidavit of debt dated 27 June 2012.
Notice of objection dismissed.
A sequestration order be made against the estate of Mohammad Tabibar Rahman.
The applicant’s costs be fixed in the amount of $3,639.50 and paid from the estate of the Respondent in accordance with the Act.
Under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Receiver in Sydney within 2 days.
All proceedings under this order be stayed for a period of 21 days.
THE COURT NOTES:
That the date of the act of bankruptcy is 10 April 2012.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 922 of 2012
| ROSALIND V DUBS |
Applicant
And
| MOHAMMAD TABIBAR RAHMAN |
Respondent
REASONS FOR JUDGMENT
On 25 June 2012 this matter came before me in the Bankruptcy Duty List. The applicant sought a sequestration order against the estate of respondent. The respondent came to court with two documents filed on 7 June 2012. The first purported to be a notice stating grounds of opposition to the application. The second was an affidavit in support. Both documents remain in the file. Both documents are embarrassing as that term is known to the law. An extract will give the flavour:
“I, Mohammad Tabibar Rahman, a Juris Doctor, Post Graduate , Final Year Law student, University of Technology, Sydney –UTS as claimed alleged ‘Debtor’ by the alleged ‘Rosalind V Dubs, [false personification] … pursuant to a decision made by a Statute body – University of Technology, Sydney for relief and compensation for infringement of educational rights to be qualified for Solicitor/Barrister specialised in the modern Jurisprudence of :-f Administrative Law, International law, Human Rights law and International Treaties and not Rosalind v Dubs, Non- Executive Director, Norton Rose Australia , a false personification. And as such the applicant do not owe any money and not a Bankrupt.” [emphasis in original]
The affidavit followed the same pattern. It was clear that I could not deal with the matter on that duty day. Over Mr Rahman’s objections, I ordered that he file and serve what I hoped might be a clearer iteration of his grounds in a two-page document with dot points. I ordered the applicant to file and serve a response. Mr Rahman has complied, albeit with no greater clarity, with that order.
It appears that he seeks to transfer the matter to the Federal Court or the High Court as this court does not have jurisdiction. Whilst the temptation to accede to that request is great, I shall resist because in Capital Finance Australia Ltd v Vellar [2012] FMCA 285, Smith FM authoritatively determined that this court was competent to hear and determine such matters, the finding that Barnes FM made some years ago in Australian Litigation Fund Pty Ltd v Mearns (No.3) [2005] FMCA 1870.
Mr Rahman also objects to my hearing the matter because he was not happy with the orders previously made. I reject any suggestion that a hypothetical fair-minded lay person might reasonably apprehend that I might not bring an impartial mind to the resolution of the question to be decided; Re Refugee Review Tribunal; Ex parte H (2001) 179 ALR 425, merely because I made orders requiring clarification of the respondent’s submission.
Mr Rose, who appears on behalf of the applicant, has provided me with the required documents for the purposes of s.52 of the Bankruptcy Act 1966 (Cth)[1] and the Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth)[2]. He asked that I waive complete compliance with R.4.06 of the Rules, insofar as the affidavit of debt cannot be sworn today by the applicant. This is because, as she deposes to in her affidavit filed in court, she is currently in Switzerland. She did file an affidavit on 27 June 2012 and I accede to Mr Rose’s request and order that compliance with R.4.06 of the Rules be made by the filing of an affidavit of debt dated 27 June 2012. I do this because I am satisfied that Mr Rahman, whilst disputing the existence of the debts, has not made any payment of them.
[1] The “Act”.
[2] The “Rules”.
The dot-point document filed on 29 June 2012 is intended to set out Mr Rahman’s grounds of objection to the making of a sequestration order. The document is not easy to comprehend. But I believe, that through a process of questioning of Mr Rahman, I was able to extract the essential points that he has made, and it is with those that I shall deal.
The first point that Mr Rahman makes is that this court does not have jurisdiction to deal with this matter. That point, I believe, has been dealt with by me in the early part of these reasons. This court has been granted jurisdiction in bankruptcy matters by the Act and the scheme of the Federal Magistrates Act 1999 (Cth) is that the court will have jurisdiction in those matters in which it is provided with jurisdiction by the substantive Acts.
Mr Rahman claims that this Court cannot decide constitutional matters and in support of that submission he refers to s.23 of the Judiciary Act1903 (Cth)[3]. That section of the Judiciary Act is headed “Decision in Case of Difference of Opinion”. In my view, the court does have powers to make findings in relation to constitutional matters, although I fully accept that if appropriate s.78B notices are served and the matter is clearly one of constitutional importance, this court would refer it immediately to the Federal Court or the High Court for decision.
[3] The “Judiciary Act”.
The constitutional point that Mr Rahman raises in regard to this case appears to be that there is no power in the Official Receiver issuing a bankruptcy notice. Mr Rahman alleges that the issue of a Bankruptcy Notice is a judicial act and, citing cases such as the Boilermakers’ Case[4] and Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245, he argues that such an act can only be undertaken by a court created under Chapter III of the Constitution.
[4] Re Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254.
I am satisfied that the Official Receiver has the power granted to him by s. 41 of the Bankruptcy Act to issue a Bankruptcy Notice. To my mind, the issuance of a Bankruptcy Notice is not a judicial act, it is an administrative one. It is not the issue of a Bankruptcy Notice that brings matters to be determined, it is non-compliance with that notice that allows a party to bring an application for a sequestration order. A sequestration order can only be made by a court of competent jurisdiction of which this is one.
It is for this reason that, notwithstanding the issuance by Mr Rahman of s.78B notices to the Federal and other Attorneys-General, I do not propose to hold up the matter whilst a decision is made on this constitutional point. As Mr Rose says in his helpful written submissions:
“Section 78B does not […] impose on the Court a duty not to proceed pending the issue of a notice no matter how trivial, unarguable or concluded the constitutional point may be (Australian Competition and Consumer Commission v C G Berbatis Holdings Pty Ltd [1999] FCA 1151, [14]). If the asserted constitutional point is frivolous or vexatious or raised as an abuse of process, it will not attach to the matter in which it is raised the character or matter arising under the Constitution or involving its interpretation - Nikolic v MGIC Limited [1999] FCA 849 cf Australian Securities and Investments Commission v White (unrep, Fed Court, 16/7/98, Drummond J).”
I respectfully agree with those submissions.
Mr Rahman also alleges that the only way in which a judgment of a state court can be enforced is by utilising state systems or as he tells me, “state law.” In other words, there is no ability to utilise the Bankruptcy Act to obtain a sequestration order where a judgment of a state court has not been paid. I regret that I am unable to make such a finding. The Bankruptcy Act is a law of the Commonwealth and to the extent that it might be said in Mr Rahman’s favour, that it conflicts with those authorities which he uses to justify his submission, a Commonwealth Act must always take precedence to that of a State.
Mr Rahman raised a rather difficult to comprehend argument that appears to revolve around the fact that the solicitors acting on behalf of the applicant used to be known as Deacons but are now known as Norton Rose. I really cannot see what that has to do with his failure to comply with the Bankruptcy Notice. He also raised an argument about service of the Bankruptcy Notice but I am satisfied, from the affidavits of service, that it was personally served upon him.
Finally, Mr Rahman raises what might be considered to be his only reasonable argument. He has made application to seek leave to appeal against the orders which founded the Bankruptcy Notice. In order to clarify the position, I would say that the judgments which founded the Bankruptcy Notice are judgments that came about as a result of the costs assessment process. This process is codified in the Legal Profession Act 2004 (NSW). Essentially, it allows for costs of proceedings to be assessed by a person known as a costs assessor. It allows for a party, against whom a costs order has been made, to make representations to the costs assessor about the costs that the successful party claims. If a party is not satisfied with a costs assessor’s assessment, he can seek review, and if he is not satisfied with the result of the review, he can appeal to the Supreme Court on a point of law. As I understand it, this is what Mr Rahman has done initially in respect of only two of the judgments but, as Mr Rose concedes, possibly now in respect of all four of them.
Mr Rahman seeks an order that this application be adjourned until after the hearing of the matter in the Supreme Court, which he tells me will take place tomorrow. The court has power to adjourn proceedings for a sequestration order where an appeal is pending and will frequently do so provided it can be satisfied that the appellant has at least an arguable case. But there is a difference between an appeal against a first instance judgment and an appeal upon a point of law in respect of a costs assessment where the applicant has had the opportunity to seek a review of the quantum.
It also concerns me that what I have learnt from Mr Rahman about the nature of his appeal seems to traverse much of the type of argument that he has made to me today. He believes he can find assistance in his cause from the fact that Ms Dubs is no longer the registrar of the University of Technology. He seems to believe that he can find assistance in the fact of the change of name of the solicitors. He has not indicated to me anything from which I could discern that he has a reasonably arguable case and, for that reason, I am not prepared to grant him the adjournment, even though the matter is to be heard tomorrow.
However, what I am prepared to do is to stay any proceedings under a sequestration order that I intend to make for a period of 21 days so that Mr Rahman can attend Court tomorrow and argue his point. If the points have merit and judgments are set aside, then appropriate action can be taken in relation to this order.
In those circumstances, I am satisfied that there is no merit in the notice of objection and I dismiss it. I am satisfied that the respondent committed the act of bankruptcy alleged in the petition. I am satisfied that the proof of the other matters required by s.52 of the Act. I make a sequestration order against the estate of Mohammad Tabibar Rahman. I order that the applicant’s costs be fixed in the amount of $3,639.50 and paid from the estate of the respondent in accordance with the Act. Under the Bankruptcy Regulations, a copy of the sequestration order shall be given to the Official Receiver in Sydney within two days. The court notes the date of the act of bankruptcy is 10 April 2012. All proceedings under this order be stayed for a period of 21 days.
I certify that the preceding eighteen (18) paragraphs are a true copy of the reasons for judgment of Raphael FM
Date: 3 August 2012
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