Evans, J.D. v The Heather Thiedeke Group Pty Ltd

[1990] FCA 638

3r/ 90

JUDGMENT NO. .6 ........ .... ..,..,. ,.,

m 1 No. G56 of 1990

SLAND DISTRICT REGISTRY	1
RAL DIVISIW	1

BETWEEN :  JOHN DAVID EVANS

Applicant

AND :  ER THIEDEKE GROUP PTY. LTD.

Respondent

Amendment to the Ex Tempore Reasons for Judgment of Pincus J. delivered on 9 October 1990:

1.    In the Minutes of Order, replace the heading with:

"IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION"

2.    In the Minutes of Order, replace the Note with:

"Settlement and entry of orders is dealt with in Order 36
of the Federal Court Rules".

3.    On Page 1 of the Ex Tempore Reasons for Judgment, replace the heading with:

"IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION"

16 ~overnber' l990

-7

C. -- -._c r -- -.l .-

\ '

Eseociate to Pi ncus J.

638 90

JUDGMENT No. ........ ... , , / . .

C A T C H W O R D S

W R U P T C Y - application to stay sequestration order and Full

Court judgment - whether Court has jurisdiction to stay sequestration order - likelihood of ~ i g h Court granting special leave considered.

John David Evana
v. The Heather Thiedeke Grouw Ptv. Ltd.

G56 of 1990

PINCUS J.
BRISBANE

9 OCTOBER 1990

LN THE FEDERAL COURT OF AUSTRALIA	No. G56 of 1990
GENERAL DIVISION

UPTCY DISTRICT OF THE SOUTHE RN

DISTRICT OF THE STATE OF OUEENS LAND

BETWEEN r JOHN DAVID EVANS

Applicant

AND:  THE HEATHER THIEDEKE GROUP PTY. LTD.

Respondent

MINUTES OF ORDER

JUDGE MAKING ORDEBr	PINCUS J.
DATE OF ORDER:	9 OCTOBER 1990

lW$JtE MADE: BRISBANE

1 - H

1.    The application be dismissed.

2 .    The costs of and incidental to the application be the petitioning creditor's costs in the proceedings.

x?z!?rk:	Settlement and entry of orders is dealt with in Rule
124 of the Bankruptcy Rules.
IN THE FEDERAL COURT OF AUSTRALIA	) No. G56 of 1990
GENERAL DIVISION	)
BANKRUPTCY DISTRICT OF THE SOUTHERN	1
DISTRICT OF THE STATE OF OUEENSLANQ	1

BETWEEN :  JOHN DAVID EVANS

Applicant

AND :  THE HEATHER THIEDEKE GROUP PTY. LTD.

Respondent

lxW!&&	PINCUS J.
u&E:	BRISBANE
Q&r.Es	9 OCTOBER 1990

EX TEMPORE REASONS FOR JUDGMENT

This is a Notice of Motion to stay a sequestration order made on 4 May 1990 by Spender J., and also to stay a judgment of the Full Court of 28 September 1990, dismissing an appeal from the order of Spender J.

The sequestration order was based upon failure to

comply with a bankruptcy notice, which was in turn based upon

a judgment in the Supreme Court of Queensland of 24 December	1987. That was given in an action for architects' fees which
was in the result successful. The Supreme Court's judgment has been the subject of discussion in a number of subsequent judgments and it has to be said that, generally speaking, Courts which have considered it have been less than confident of its correctness in all respects. One such Court was the Full Court of the Supreme Court of Queensland which, nevertheless, dismissed an appeal from the single Judge's decision; an application for special leave to appeal from the Supreme Court's decision to the High Court was dismissed.
A bankruptcy notice was issued and an unsuccessful application was made to Spender J. to set aside that notice. I dismissed a similar application relating to a second bankruptcy notice, founded on the same debt with some additional interest. On 19 May 1989, an appeal was taken to the Full Court of this Court from my judgment, but that was dismissed and then an application for special leave to appeal from the Full Court's judgment to the High Court was also dismissed.
A petition was presented based on the second notice and Spender J. made a sequestration order, as I have mentioned, on 4 May 1990. That order has also been challenged in the Full Court which delivered judgment, as I have mentioned, on 28 September 1990, dismissing Mr. Evans' appeal.
Mr. Evans, who argued his case again in an admirable way, proposes to take this latest Full Court decision to the High Court.
Two points have been argued before me. The first is whether this Court has jurisdiction to stay the sequestration order. I was referred to Jenninas Construction Ltd. v. ndv Rovale Investments Ptv. Ltd. (1986) 161 C.L.R. 681, and I have looked at, amongst other decisions, my own in Patton v. Minister for Defence (1987) 71 A.L.R. 637. I have also studied the remarks made by the Full Court concerning the
subject of stay, in its reasons of 28 September 1990.
It appears that the practice of the New South Wales Court of Appeal is ordinarily to grant a stay to permit a party, unsuccessful before it, to pursue an application for special leave to appeal to the High Court: John Fairfax and
Sons Ltd. v. &JJy (No. 2) (1987) 8 N.S.W.L.R. 510 at 512. The Court said in that case that it "could be embarrassing ...
to speculate upon whether or not a case is one in which special leave to appeal would be granted by the High Court of
Australia ...". Despite that difficulty, it appears to me
that this Court should not automatically or routinely grant a stay of a sequestration order after an unsuccessful appeal to the Full Court of this Court by the bankrupt. As Mr. Evans has pointed out, drastic consequences ensue from bankruptcy and if he were to be ultimately successful, the lack of a further stay would turn out to be, at the least, inconvenient.
stay, can hardly avoid giving some consideration to the In my opinion, the Court, unless it is to routinely grant a
prospects of success.
I have, since the application was heard yesterday, had the opportunity to consider further the reasons of the Full Court and Mr. Evans' challenge to them. Although Mr. Evans insists that the Full Court did not properly comprehend the point he wished to make, he is unable to point to any question of principle involved in the case; in essence, his complaint is that, according to accepted principles, Spender J. should have gone behind the judgment of the Supreme Court and the Full Court should have allowed the appeal against
Spender J s : refusal to do so.
The essential point, as it seems to me, of the Full Court's reasons is to be found at pages 29 and 30 and is a narrow one. At page 29 their Honours remarked:

"All of the matters relied upon by the appellant
relate to the correct resolution of the issue
whether the contract of retainer included a
term that 'the units would be so designed that
the cost of their construction would not exceed
a figure which would return a profit of 20 per
cent. to the appellant if they were sold at an
average price of $70,000.' However, even if
the Court were, upon the holding of the inquiry
which the appellant seeks, to find that the
contract of retainer contained such a term,
that circumstance would not, of itself, operate
to displace, for the purpose of the bankruptcy
proceedings, the alleged indebtedness. That
would follow if, and only if, it were to be
coupled with a finding that there was a failure

on the part of the respondent to perform the

contract including that term".

After setting out, with apparent approval, the treatment of that point in the Supreme Court, their Honours went on:

"There is nothing in the material before this
Court to suggest that before making a
sequestration order the Court should have gone
behind that part of the judgment of the Full
Court of the Supreme Court. That being so, to
embark upon an inquiry, with its attendant
expense, into the question whether the contract
of retainer included the term alleged would
be a futile exercise. On that ground, we are
of opinion that the principal ground of appeal
must fail".

It is my respectful opinion that the view so taken by the Full Court which seems to be at the core of its reasons contains nothing which is likely to attract a grant of special leave by the High Court.

Despite the admitted awkwardness of attempting to form a view about Mr. Evans' prospects in the High Court, I have come, with some regret, to the conclusion that the High Court is very unlikely to intervene and that I should refuse this application for a stay. The application is dismissed. The costs of and incidental to the application will be petitioning creditor'e costs in the proceedings.

I certify that this and the four preceding pages are a true copy of the reasons for judgment herein of hie Honour Mr. Justice Pincus.

Date &*I/ /490

Counsel for the applicant:	Mr. J.D. Evans (for himself)
Solicitors for the applicant:	Caradoc Evans 6 Co.
Couneel for the respondent:	P.A. Hastie
Solicitors for the respondent:	Morris Fletcher & Cross
Date of Hearing:	9 October 1990