George Town Council v NEILSEN
[2018] FCCA 74
•30 January 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| GEORGE TOWN COUNCIL v NEILSEN | [2018] FCCA 74 |
| Catchwords: BANKRUPTCY – Judicial Review – costs order of Tribunal – whether constitutes a final or judgment order pursuant to s.42(1)(g) of the Bankruptcy Act1966 – application dismissed. |
| Legislation: Bankruptcy Act 1966, ss.40, (1)(g), 41 Resource Management and Planning Appeal Tribunal Act 1993 (Tas), s.28(6) |
| Cases cited: Resource Management and Planning Appeal Tribunal Act 1993 (Tas) |
| Applicant: | GEORGE TOWN COUNCIL |
| Respondent: | GRAEME NEILSEN |
| File Number: | LNG 76 of 2016 |
| Judgment of: | Judge McGuire |
| Hearing date: | 7 July 2017 |
| Date of Last Submission: | 12 December 2017 |
| Delivered at: | Launceston |
| Delivered on: | 30 January 2018 |
REPRESENTATION
| Counsel for the Applicant: | Ms Knott |
| Solicitors for the Applicant: | Page Seager |
| The Respondent appeared in person |
ORDERS
That the Application for Review filed 20 April 2017 be dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT LAUNCESTON |
LNG 76 of 2016
| GEORGE TOWN COUNCIL |
Applicant
And
| GRAEME NEILSEN |
Respondent
REASONS FOR JUDGMENT
Application
This is an application for a review of a Registrar's decision made 13 April 2017 dismissing the applicant’s Creditors Petition filed against the respondent on 5 December 2016.
The Registrar dismissed the petition because:
i)A costs order of the Resource Management and Planning Appeal Tribunal (Tas) (“the Tribunal”) made 10 July 2014 and later quantified by an amended Certificate of Taxation issued by the Tribunal on 8 September 2015 was unenforceable because the order was not registered with the Supreme Court of Tasmania pursuant to s.28(6) of the Resource Management and Planning Appeal Tribunal Act 1993 (Tas) (“RMPAT Act”); and
ii)The order is not a final judgment or order in accordance with s.40 (1) (g) of the Bankruptcy Act 1966 (“the Act”).
The Application for Review filed 20 April 2017 seeks the following orders:
i)The sequestration order be made in the terms of the Creditors Petition ($60,628.14);
ii)The respondent pay the applicant's costs of the sequestration order; and
iii)The respondent pay the applicant's costs of the review application.
The applicant is represented by solicitors from whom I have received helpful written submissions.
The respondent before me is self-represented and argues that the Application for Review be dismissed. The respondent has provided me with copious materials including substantial written submissions. From the respondent’s materials and his oral submissions in Court, I understand that he firstly adopts the reasoning of the Registrar in arguing for dismissal of the application. In the alternative he puts forward a ‘go behind’ argument or arguments.
Background
The respondent was involved in a planning dispute with the applicant Council regarding a redevelopment project. The respondent is a former member of the George Town Council. The respondent was unsuccessful in his application. The Tribunal delivered reasons on 10 July 2014. The respondent was ordered to pay the applicant's costs of and incidental to the appeal and evident in the reasons at [25] as follows:
The order of the Tribunal is that the appellant is to pay the respondents’ George Town Council and the State of Tasmania, costs of and incidental to this Appeal in accordance with 90% of the higher scale of costs for the time being in force pursuant to the Supreme Court Rules 2000 and, if not agreed, to be assessed by the Registrar of the Appeal Tribunal.
[26] that such costs are to be paid within 28 days of receipt of the bill of costs, or if such bill is disputed, within 28 days of the issuance of a Certificate of Taxation.
It is this outstanding costs order which grounds the application for the Creditors Petition.
The Creditors Petition relies on a Bankruptcy Notice issued 16 May 2016 and served personally on the respondent on 17 May 2016.
I borrow from the applicant’s submissions and accept that attached to the Bankruptcy Notice are copies of the following documents:
(a)Letter from the Supreme Court of Tasmania to Page Seager dated 30 September 2015 advising that the Amended Certificate of Taxation was registered pursuant to section 28 (6) of the RMPAT Act in the Supreme Court on 30 September 2015 and can be referred to as matter number S/1110/2015;
(b)The Amended Certificate of Taxation from the Tribunal dated 8 September 2015 certifying that the respondent’s Bill of Costs (the Applicant in these proceedings) were taxed between party and party in the total sum of $60,628.14 comprised of (a) $19,331.26 (fees not including GST);
(c)($39,363.75) (disbursements inclusive of GST);
(d)$1933.13 ( GST on fees).
At the bottom of the certificate are the following footnotes:
1.Amendment to include full name of Applicant.
2.Fees were calculated at $21,479.10. The Tribunal’s order at paragraph 35 was applied reducing fees to $19,331.26.
3.Disbursements for Council’s fees were taxed down to $11,940.79. The Tribunal’s orders at paragraph 25 were applied. GST is then applied to that sum as well as the other disbursements from witnesses(which are listed at the top of page 10 of the Bill of Costs and did not have GST applied to these figures in that Bill)';
(d) The Reasons for Decision of the Tribunal delivered on 10 July 2014. The order discloses that it was made in a proceeding in which George Town Council were the Respondents and Graeme Neilson was the Applicant.
The order, therefore, obliged the respondent to pay the applicant's costs of and incidental to the Appeal before the Tribunal at 90% of the higher scale of costs pursuant to the Supreme Court Rules 2000 and, if not agreed, then to be assessed by the Registrar of the Tribunal and then such costs to be paid within 28 days of receipt of the Bill of Costs or 28 days of the issuance of the Certificate, whichever is later.
Relevant Legislation
S.40 of the Bankruptcy Act provides:
(1)A debtor commits an act of bankruptcy and each of the following cases:
…
(g)If a creditor who has obtained against the debtor a final judgment or final order (my emphasis). Being a judgment or order the execution of which is not been stayed, has served on the debtor in Australia or, by leave of the Court elsewhere, a Bankruptcy Notice under this Act and the debtor does not:
(i) Where the notice was served in Australia – within the time specified in the notice;
(ii) …
Comply with the requirements of the Notice or satisfy the Court that he or she has a counter-claim, set-off or cross-demand equal to or exceeding the amount of the judgment debt or sum payable under the final order, as the case may be, being a counter-claim, set-off or cross-demand that he or she could have set up in the action or proceeding in which the judgment or order was obtained;
…
(iii) For the purposes of (1)(g):
…
(b) A judgment or order that is enforceable as or in the same manner as, a final judgment obtained in an action shall be deemed to be a final judgment so obtained and the proceedings in which, or in consequence of which, the judgment or order was obtained shall be deemed to be the action in which it was obtained.
S.41 of the Act provides:
(1)An Official Receiver may issue a Bankruptcy Notice on the application of the creditor who was obtained against a debtor:
(a)A final judgment or final order that:
(i)Is of the kind described in paragraph 40 (1) (g); and
(ii)Is for an amount of at least $5,000.
...
3. A Bankruptcy Notice shall not be issued in relation to a debtor:
(a)Except on the application of a creditor who was obtained against the debtor a final judgment or final order within the meaning of paragraph 40 (1) (g) or a person who, by virtue of 40 (3) (d), is to be deemed to be such a creditor;
(b)If, at the time of the application for the issue of the Bankruptcy Notice, execution of a judgment or order to which it relates has been stayed.
S.28 of the RMPAT Act provides:
…
(6)An order for costs under this section may be registered in a Court having jurisdiction for the recovery of debts of the amount ordered to be paid by or under the order.
(7)Proceedings for the enforcement of an order for costs under this section may be taken as if the order were a judgment of the Court in which the order is registered.
Consideration
Following the same course of consideration as the Registrar, I am first to determine whether the order quantified by the Certificate is able to be enforced pursuant to s.28(7) of the RMPAT Act?
It is clear that it is the Certificate of Taxation quantifying the costs that has been registered with the Supreme Court. The order itself has not been registered and this is conceded by the applicant.
I accept the applicant’s submission to the effect that the order is inherent in the Tribunal’s reasons and not taken out separately and hence cannot be extracted out of the reasons for registration with the Court.
I also accept that, in any event, an order in such uncertain terms as to quantum cannot be enforced until the amount required to be paid by the respondent is quantified.
Nevertheless, it is clear from the wording of s.28(6) and (7) of the RMPAT Act that it is the order that is to be registered and that such registration allows enforcement of the order. Again, the applicant concedes that the order itself has not been registered but rather only a Certificate of Taxation of a taxing officer.
The applicant's counsel provided me with authority of Finkelstein J in Scott v Chantopoulous[1] which, on examination and reflection, does not, in fact, assist the applicant’s argument but, rather on my reading, supports the findings of the Registrar in this matter being that the Certificate of Taxation merely makes certain a quantum of the costs to be paid whereas the liability to pay such costs stems from the order and it is this order itself which is the 'final judgment or final order' for the purposes of the Act. His Honour observes at [4] and [10):
[4] In most jurisdictions, upon the completion of a taxation of a Bill of Costs, the taxing master issues a Certificate of Taxation or an allocator, until that point the quantum of the costs unnecessarily indeterminate. But after the Certificate or allocator is issued the costs become a 'sum certain': Re Watkins of the Ranger Uranium Mines Pty Ltd (1985) 35 NTR 27 at 32. The certificate or allocator amounts to an authority for the enforcement of the amount allowed by the taxing master: Garrard v email furniture Pty Ltd (1993) 32 NSWLR 662 at 678. But the liability to pay costs depends upon the order made by the Court that costs be paid by one party to another. It is that order (i.e. the order of the Court) that is a final judgment for the purposes of the Bankruptcy Act: Re: Cartwright; ex parte; Cartwright v Barker [1975] 1 WLR in 573, 576. The taxing master’s Certificate or allocator is not a final judgment for that purpose: Re: Crump; ex parte Crump (1891) 64 LT 799.
[10] It may be true that the taxing master’s final order can stipulate, in an appropriate case, what proportion of the taxed costs a particular party is liable to pay. However, in each instance it is not the taxing master who makes the decision as to the appropriate proportions. He is only entitled to implement the order of the judge directing how the costs are to be paid. That is to say, the taxing master is only performing a ministerial function by giving effect to a judge’s order.
[1] [2008] FCA 1914
It follows that I agree with the Registrar that the Certificate of Taxation is not synonymous with an order. They are concepts of different character. The order is a tool of compulsion whereas the Certificate is only a tool of supplementary implementation and itself carries no compulsion absent the order.
The material provided by the applicant from the Supreme Court simply shows the registration of the Certificate and does not assist in satisfaction of the requirements of the relevant legislation for registration of the primary order.
Consequently, I concur with the Registrar that the provisions of the RMPAT Act have not been satisfied in that the order, later quantified by the by the Certificate, has not been registered with the Court and proceedings for enforcement cannot properly be taken under s.28 (7).
The applicant argues in the alternative that the order of the Tribunal is, in any event, a final judgment or final order for the purposes of s.41 of the Act and, attached to the Bankruptcy Notice, constitutes a valid Bankruptcy Notice and therefore registration of the order for enforcement is not required.
The applicant relies on the wording of s.28 (6) that 'an order may (my emphasis) be registered in Court having jurisdiction for the recovery of debts of the amount ordered to be paid by or under the order (my emphasis).
However, s.40 (1) (g) of the Act contemplates only an order that is capable of immediate execution. I repeat and adopt the Registrar’s citation of Drummond J in re: Gibbs, ex parte Triscott[2] concluding:
… Only judgment on which a creditor is entitled to issue execution at the time of the issue of the Bankruptcy Notice can constitute a final judgment of the kind referred to in s40 (1) (g) of the Bankruptcy Act.
[2] (1995) 133 ALR 718 2 p721
That is, to issue a valid Bankruptcy Notice the creditor must be in a position to execute the order. However, I agree with the Registrar that that the order, not being taken out, but simply quantified by the Certificate of Taxation, has not been registered pursuant to s.28 (6) of the RMPAT Act and does not, therefore, constitute a final judgment or final order for the purposes of s.40 (1) (g) of the Act.
Consequently, I reject the arguments in the alternative put by the applicant. I am satisfied that the Bankruptcy Notice served on the respondent does not have attached to it a final judgment or final order capable of execution and is, therefore, invalid. It follows that the respondent has not committed an act of bankruptcy and that the Creditors Petition and the Application for Review are to be dismissed.
I certify that the preceding twenty seven (27) paragraphs are a true copy of the reasons for judgment of Judge McGuire
Associate
Date: 30 January 2018
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