Hera Project Pty Ltd v Bisognin (No 2)
[2019] VSC 625
•16 September 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST
S CI 2018 02233
| HERA PROJECT PTY LTD (ACN 163 685 041) | Plaintiff |
| v | |
| GINO ANDREW BISOGNIN | First Defendant |
| and | |
| LEAH JOAN BISOGNIN | Second Defendant |
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JUDGE: | CHAMPION J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 16 August 2019 |
DATE OF JUDGMENT: | 16 September 2019 |
CASE MAY BE CITED AS: | Hera Project Pty Ltd v Bisognin & Anor (No 2) |
MEDIUM NEUTRAL CITATION: | [2019] VSC 625 |
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CONTEMPT OF COURT – Failure to comply with court orders – Continued non-compliance – Defendants failed to attend trial – Defendants self-represented – Contempt proven – Penalty.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr L. Warren | Russell Kennedy Lawyers |
| For the First Defendant | No appearance | |
| For the Second Defendant | No appearance |
HIS HONOUR:
Introduction
On 11 July 2018 and 9 October 2018, Hera Project Pty Ltd (‘the plaintiff’) applied to the Supreme Court of Victoria for the punishment of Gino Bisognin and Leah Bisognin (‘the defendants’) for contempt of court, pursuant to rr 66.05(1)(a) and 75.06 of the Supreme Court (General Civil Procedure) Rules 2015 (‘the Rules’). The plaintiff alleged by way of two summonses, that the defendants committed contempt of court by failing to comply with various court orders.
On 19 July 2019, I determined that the defendants had each committed contempt of court by failing to comply with:
(a) the order of Riordan J made on 28 June 2018, to which a freezing order was attached as Schedule 1 (‘the first freezing order’);[1] and
(b) the order of Riordan J made on 31 August 2018, to which ancillary orders in support of the first freezing order were attached as Schedule 2, and which was extended on 3 October 2018 (‘the second freezing order’).[2]
[1]For relevant terms of the order see Hera Project Pty Ltd v Bisognin [2019] VSC 483 [12]–[13].
[2]Ibid [19]–[20], [24]–[25].
The background of these proceedings and details of the contempt are set out in some detail in Hera Project Pty Ltd v Bisognin [2019] VSC 483 (‘Hera Project v Bisognin’). In summary, I determined that each of the defendants committed contempt by failing to comply with paragraph 6 of the first freezing order and paragraphs 1–3 of the second freezing order, by failing to provide the relevant material by the required date. I further found the defendants continued to be in non-compliance with paragraphs 6(a)(ii)–6(c) of the first freezing order and paragraph 1 of the second freezing order.[3]
[3]Ibid [106]–[107].
Having found the contempts proven, in circumstances where the defendants failed to appear for hearings and were not represented, I deferred my determination on the nature of the contempt and of the penalty to be imposed, to provide the defendants with further opportunity to make submissions.[4]
[4]Ibid [44]–[65]; [109]–[112].
Preliminary issues
The defendants’ legal representation and proceeding in their absence
I have set out the details of the defendant’s representation up until 19 July 2019 at paragraphs [44]–[65] of Hera Project v Bisognin. In summary, the defendants were represented by Craig Stevenson of A Ace Solicitors for the larger part of these proceedings. However, on 21 November 2018, Mr Stevenson filed a Notice of Ceasing to Act, and the defendants were not represented thereafter, including at the hearing of the trial of the contempt summons on 30 January 2019.
The defendants also failed to appear personally at the trial on 30 January 2019, and I determined to proceed in their absence for the reasons set out at paragraphs [51]–[65] of Hera Project v Bisognin. I note that neither defendant has appeared in person in any of the proceedings over which I have presided.
Following my judgment on 19 July 2019, I made orders inviting the defendants to file and serve any submissions by 9 August 2019 and listed the matter for a hearing on penalty on 16 August 2019.
That same day, the Court sent an email to all parties attaching a transcript of the hearing and a copy of the judgment, and drawing the defendants’ attention to the fact the charges of contempt had been proven against them; that a sentence of imprisonment was open as a possible penalty; that they were to each file and serve any submissions in reply to the plaintiff’s submissions on penalty by 9 August 2019; and that the matter was listed for a further hearing as to penalty on 16 August 2019, which they were required to attend. On 23 July 2019, the Court further sent a letter to the defendants by registered post outlining the same information, and enclosing the same attachments.
The defendants did not appear and were not represented at the hearing on penalty on 16 August 2019. Given their continued non-appearance and general failure to engage with these proceedings before the Court, I was satisfied it was appropriate to proceed to hear the plaintiff’s submissions as to penalty in their absence. I am likewise satisfied to proceed today to sentence the defendants in their absence.
Nature of the contempt: criminal or civil
In Hera Project Pty Ltd v Bisognin, I set out the distinction between civil and criminal contempt.[5] While it is generally accepted that disobedience of a court order will usually be civil contempt, it may be a criminal contempt where:
[5]Ibid [68]–[78].
(a) the contempt is contumacious; or
(b) the proceedings serve a punitive purpose of punishing a past breach, rather than a remedial purpose of coercing obedience with the order.[6]
The former focuses on the nature of the contempt, the latter on the purpose of the proceedings.
[6]CFMEU v Grocon Constructors (Victoria) Pty Ltd (2014) 47 VR 527 (‘CFMEU v Grocon’) [275]–[276], citing Mosman Municipal Council v Kelly (No 3) [2009] NSWLEC 92 [58]; Witham v Holloway (1995) 131 ALR 401; Hearne v Street (2008) 235 CLR 125.
Was the defendants’ breach casual, wilful or contumacious?
A deliberate act or omission in breach of a court order will ordinarily constitute wilful disobedience, unless the contemnor is able to show by way of exculpation that the default was casual, accidental or unintentional.[7] A wilful breach may further be considered contumacious where, for example:
[7]Ibid [140], citing Anderson v Hassett [2007] NSWSC 1310 [6]; Primelife Corporation Ltd v Newpark Pty Ltd [2003] VSC 106 (‘Primelife’).
(a) the contemnor knows the breach is prohibited and has no reasonable belief that it can be excused;[8]
(b) the breach involves perverse obstinate resistance to authority;[9] or
(c) there is a direct intention to disobey the order.[10]
[8]In the Marriage of Kitchener (1978) 20 ALR 535.
[9]Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd (1985) 9 FCR 194 (‘AMIEU v Mudginberri’).
[10]Seymour v Migration Agents Registration Authority (2006) 215 FCR 168.
The plaintiff’s submissions
The plaintiff submits the defendants’ conduct in breaching the relevant court orders was wilful, deliberate and voluntary, as opposed to merely ‘technical’ or ‘casual, accidental or unintentional’. The plaintiff further submits the conduct is characterised by elements of defiance and obstinacy, and should thus be considered contumacious. It is submitted that the defendants engaged in a deliberate pattern of delay, with the intention of frustrating court proceedings and the plaintiff’s efforts to protect itself.
In Hera Project v Bisognin, I set out the details and evidence in respect to the defendants’ knowledge of the terms of the relevant orders, and conduct that constituted the contempt.[11] I do not repeat these details here, but note the judgments should be read together. The plaintiff relies on these particulars and findings to argue that the defendants knew they had not complied with court orders, failed to rectify that non-compliances, and acted deliberately and defiantly at all times.
[11]See particularly [82]–[87], [92]–[105].
At the penalty hearing on 16 August 2019, counsel for the plaintiff submitted that the defendants could have attended Court and sought representation, chosen to purge their contempt; or demonstrated genuine remorse through an apology at any stage over the course of these proceedings. The plaintiff submits that their failure to do so demonstrates that their conduct has been prolonged, defiant and dishonest, and amounts to contumacious contempt.
The defendants’ evidence
In Hera Project v Bisognin, I noted there was some limited material that raised concerns as to the extent and nature of the defendants’ knowledge of the orders. In his supplementary affidavit sworn on 13 August 2018, Mr Bisognin apologised to the Court for the delay in providing material in respect of the freezing orders, stating:
2.I am currently trying to do most of the work on these court matters for my wife and she has currently entrusted me to deal with things.
…
4.I am currently having severe difficulties in coping with my current predicament and I am seeking treatment and assistance from my psychologist…
…
7.I am very concerned that I do not mislead that court and I am finding this whole procedure very difficult to understand.
8.I had originally thought that my trustee in bankruptcy would look after all these court matters once I declared bankruptcy, but I now understand that the freezing order is separate from the bankruptcy and that in any case it will operate until my trustee is actually appointed.
9.Although my solicitor previously advised me that I needed to finalise my affidavit immediately after the last court appearance and I should have understood, it did not appear as if it sunk in as it should have and ordinarily would have.
10.I can only put this down to my current mental health problems which, while largely attributable to this court case, are not in any way limited to the effects on this court case. There was certainly no intentional delay on my part and I again apologise for this delay.
11.So far as I am aware, I have now fully complied with all requirements.
I also noted a letter prepared by Suzanne Carmichael of Ipsych Psychology Service in respect to Mrs Bisognin on 21 September 2018, which states:
She is stressed, confused and has trouble making sense of the complexities of current and historical legal proceedings, continuing to leave most legal correspondence to her husband, Gino.
It has been brought to her attention that she was required to appear in court for criminal proceedings. She states that she has no knowledge of this and still has no understanding of what the charges are or the seriousness of the situation she finds herself in.[12]
[12]Affidavit of Craig Stevenson affirmed 10 October 2018, Exhibit A1.
Ms Carmichael prepared another letter in respect to Mr Bisognin on 21 September 2018, which states:
Mr Bisognin has sought my services following a breakdown in his mental health with pending court charges. This has caused him no end of stress, and trauma. He has been experiencing difficulties with insomnia, chronic anxiety and has even expressed some suicidal ideations.
The Depression, Anxiety and Stress Scale (DASS21) indicates that Mr Bisognin scores extremely high on all three of these measures. This is not surprising given the current circumstances and financial losses he has experienced. He describes his current position as “a living nightmare that he can’t wake up from”.
…
The outcome of this court case will no doubt impact his mental health, I ask that this be considered in reaching a judgement.
In Hera Project v Bisognin, in concluding that both defendants knew about the terms of the freezing orders, as well as having knowledge of the subsequent orders, I made the following observations in respect to this evidence:
83.While this letter, and another provided in respect to Mr Bisognin, do not comply with the Court’s expectations in respect of expert evidence, they are some of the only material explaining the defendants’ conduct and state of mind. This material is not sufficient to persuade me the defendants did not have the requisite knowledge of the orders. … On the material before me, I am satisfied there is significant evidence to establish both defendants had knowledge of the terms of the freezing orders, in addition to knowledge of the subsequent orders relating to the contempt proceedings.
84.The evidence may, however, go some way in informing any future consideration as to whether the contempt (if established) was unintentional, wilful or contumacious. This, in turn, will be relevant to penalty. I take this opportunity to note some of this evidence is somewhat at odds with Mr Stevenson’s assertions that he fully informed the defendants as to the nature of the proceedings. It also indicates the defendants may have distinct positions that suggest they ought be represented separately in any future proceedings.
In respect to how this evidence might assist to establish the defendants’ state of mind in respect to the contempts, I note it raises the possibility that they have each experienced anxiety and stress, and these proceedings may have impacted their mental health. However, this material has not been able to be tested and has not been further explained. Ultimately the evidence fails to raise these issues to a level that usefully explains or mitigates their offending. The defendants have presented no further material to the court, nor made any submissions as to their state of minds at the time of, or following, the offending. Rather, the defendants have entirely ignored the proceedings.
Mr Stevenson’s submissions
At the hearing on 17 September 2018, Mr Stevenson, then acting for the defendants, submitted the first freezing order had been complied with, and the first contempt had been purged.[13] However, Mr Stevenson also stated he had instructions to admit the contempt on the basis the breaches were non-intentional, per the following exchange:
MR STEVENSON: Yes. I can indicate that the actual contempt is admitted. There is not an admission that it was an intentional contempt without the …
HIS HONOUR: Well, then you’d need to tell me what the elements of contempt are, and indeed address the question of whether or not a contempt can be committed in circumstances where there is no intent. What’s your submission about that?
MR STEVENSON: Your Honour, the four elements are indeed satisfied.[14]
[13]Transcript of Champion J, 17 September 2018, 6–7.
[14]Ibid, 4.
At the hearing before me on 19 October 2018, Mr Stevenson again asserted ‘there certainly was some form of compliance’,[15] but also indicated:
[15]Transcript of Champion J, 19 October 2018, 33, line 23.
MR STEVENSON: … I should indicate, the facts of the matter are going to be not disputed, in the sense that Mr Warren – he has some affidavits. There will be some argument legally as to … the relevance of material after the summons, as to whether that goes to penalty or actually offence …
And the other issue was, with my clients not being here, particularly in light of what’s happened since the last adjournment date – which I note is different to what I had intended at the last adjournment date – I don’t feel comfortable running the trial without my clients being present, in those circumstances because even today – it may very well be that I was able to procure a guilty plea today to save the court’s time but with the client not here … I did speak to them yesterday and that wasn’t the case.
HIS HONOUR: What wasn’t the case?
MR STEVENSON: They weren’t going to pleading guilty to the charges today.
HIS HONOUR: As of yesterday, they were instructing you ---
MR STEVENSON: As of yesterday ---
HIS HONOUR: Just a moment. As of yesterday, they were instructing you that this case would be defended and contested.
MR STEVENSON: They were instructing me to seek the adjournment but they were also instructing me that this case would be contented [sic] in relation to Leah. In relation to Gino, as of yesterday, he had instructed me that he’s likely to plead guilty but I don’t feel comfortable with – because of the reasons
I’ve ---HIS HONOUR: Well, I thought you just told me a few moments ago that there would be no dispute as to the facts.
MR STEVENSON: There won’t be any dispute as to the facts, Your Honour. That’s correct.
HIS HONOUR: So … what’s the nature of the defence?
MR STEVENSON: The nature of the defence will be in relation to Gino depending on the – or in relation to both parties, the capacity to understand and whether or not it’s a casual issue. It will be whether or not it’s a casual – casual non-compliance, or whether or not it’s an intentional non-compliance.[16]
[16]Transcript of Champion J, 19 October 2018, 9-11.
On this date, the following exchange also occurred:
HIS HONOUR: [I]t seems to me that the likelihood is that your clients are not – are grappling with reality and they and potentially yourself are sitting on your hands in respect of the proceedings before this court.
MR STEVENSON: That is correct, Your Honour …
HIS HONOUR: That’s correct, is it?
MR STEVENSON: That certainly is correct that there has been a passing in time, remembering that when the matter was listed before the court, my client lost contact with my office and essentially had a mental breakdown for approximately a week or two, so there was that differentiate – that time differentiation, which means that it's not so much as lengthier time as it perhaps seems.
In relation to the matter, it will ultimately be my submission that … the facts of the matter are that this is towards the lesser end of the scale …
HIS HONOUR: What, the seriousness of the alleged offending is towards the bottom end of the scale?
MR STEVENSON: In relation to contempt, I would suggest so, Your Honour.
HIS HONOUR: Yes. Right. A continued defiance of the court’s orders over a period of months.
MR STEVENSON: That is true, Your Honour, but in my submission, there certainly was some form of compliance. The intellect is – I mean, without going into the plea … it will come down to a lack of, for want of a better word, understanding of their failure to comply with these orders.
There was, certainly – there was the mental factors involved, whereby the material was prepared and in relation to Mrs Bisognin, she will be, you know, she will be saying that she was mostly a passenger in that her husband was looking after the proceedings for the relevant time.[17]
[17]Transcript 19 October 2018, p 31 line 27 – p 33 line 2.
In respect to the weight to be afforded to Mr Stevenson’s submissions, I note my comments in Hera Project v Bisognin, which went to the defendants’ compliance with relevant orders but are also relevant to my consideration of whether his submissions provide any indication of the defendants’ intentions:
[104]While Mr Stevenson asserts some level of compliance, presumably arising from the affidavits provided in August 2018, he did not point with precision to supporting evidence. Mr Stevenson’s submissions in respect to Mrs Bisognin are even more ambiguous, and clouded by the question as to whether it was proper of him to represent both defendants.
[105]The plaintiff points to Mr Stevenson’s indications that one or both of the defendants had admitted or intended to admit contempt, in support of their allegations. In light of the above excerpts of transcript, and in circumstances where the defendants failed to attend Court throughout the proceedings and were not represented at the final hearing, there is difficulty in determining the weight to be attributed to Mr Stevenson’s statements. Ultimately, I am not confident Mr Stevenson was able to obtain and communicate accurate instructions from each of the defendants.
Was the defendants’ contempt contumacious?
Mr Stevenson submitted there was some compliance with relevant orders and that the defendants’ contempt was not intentional. He cast some doubt over their capacity to understand the proceedings, and provided letters from psychologists in apparent support for this propositions. However, I have stated my significant concerns over these limited submissions and materials. Even if I were to take Mr Stevenson’s submissions at their highest, they lack sufficient detail, specificity, and supporting evidence to allow me to find that the defendants failed to understand the proceedings, or attempted any substantial compliance with the relevant terms of the orders. This is particularly so, as the defendants have been afforded ample opportunity to comply with the orders or proffer an explanation for their conduct.
Ultimately, I find nothing of any sound evidentiary basis has been advanced to me by way of exculpation to suggest that the contempts were casual, accidental or unintentional. In all the circumstances, I am satisfied that both of the defendants were aware the facts that made their conduct a breach of the relevant orders. I find that the contempts were wilful, deliberate and voluntary. Further, I note the defendants continue to avoid not only court proceedings, but also the warrants for their arrest. I accept the plaintiff’s submissions that the defendants’ conduct has been prolonged and defiant, and their contempt ought be characterized as contumacious and, therefore, criminal.
Is the purpose of these proceedings punitive or remedial?
Where the substance of the proceeding is assessed to be for the purpose of punishing past breaches, the contempt may be characterised as criminal. Even where it is not alleged that the breach of the relevant order was contumacious, the court may find that a contemnor’s conduct had a tendency to interfere with the course of justice, and would thus merit punishment as a criminal contempt.[18]
[18]CFMEU v Grocon (no 6) [270], citing Legal Services Board v Forster [2012] VSC 633.
In respect to whether the purpose of these proceedings is punitive or remedial, the plaintiff submits that, with the passing of time, the utility in attempting to coerce the defendants to comply with the orders and remedy their contempt has significantly decreased. It was emphasised that if the defendants complied with orders when made, the plaintiff may have been in position to recover alienated assets, however it would now very difficult for plaintiff to recover costs. As such, the purpose of these proceedings have become less about remedying the breach.
Although I have already found that the contempt is criminal on the basis that it was contumacious, I also accept that the purpose of these proceedings has become more punitive than coercive.
Sentencing considerations
The purpose of punishing for contempt is to uphold and preserve the orderly administration of justice. In furtherance of that goal, the principal aims of sentencing in contempt cases include specific deterrence, general deterrence, and denunciation.[19]
[19]R v Derryn Hinch [2013] VSC 554 [12].
The relevant principles regarding sentencing on a contempt application include:
(a) the nature and circumstances of the contempt;
(b) the actual consequences of the contempt;
(c) the effect of the contempt on the administration of justice;
(d) the contemnor’s personal circumstances, antecedents and financial means;
(e) the contemnor’s culpability;
(f) the contemnor’s reasons for his or her conduct;
(g) the need to deter the contemnor and others from repeating the contempt;
(h) whether the contemnor has exhibited general contrition and made a full and ample apology.[20]
[20]Deputy Commission of Taxation v Gashi (No 3) [2011] VSC 448 [5] (‘Gashi (No 3)’); R v Witt (No 2) [2016] VSC 142 [93], citing DPP v Johnson [2002] VSC 583 [55]-[60]; R v Age Co Ltd [2008] VSC 305 [22]; Alfred v CFMEU (No 2) (2011) FCA 557 [14]; Bovis Lend Lease Pty Ltd v CFMEU (No 2) (2009) FCA 650; Grocon v CFMEU [2014] VSC 142 [77]-[78].
I note that in contempt proceedings, any factors relevant to penalty that may be considered aggravating features require proof beyond reasonable doubt.[21]
[21]Primelife (no 7) [39], citing R v Storey [1998] 1 VR 359, 369; Cheung v The Queen (2001) HCA 67 [14].
The nature and circumstances of the contempt
I have outlined the nature and circumstances of the defendants’ contempts in my consideration of whether they were civil and criminal, with reference to Hera Project v Bisognin, and found the contempts were contumacious.
In respect to the seriousness of the offending, the plaintiff submits that the defendants’ conduct ought to be considered in an upmost category of seriousness for the offence. The plaintiff submits that the context of this matter is significant, and argues that the documents that have been produced strongly suggest the defendants have engaged in a ‘sophisticated scheme’ to defraud their creditors. The plaintiff submits the relevant orders were made to protect the plaintiff, as there was reasonable cause for concern the defendants were dissipating their assets, to avoid their liabilities arising from judgments in favour of the plaintiff.
The plaintiff further argues that the defendants appear to have ‘got away’ with this alienation of their assets by failing to comply with the Court’s orders to supply certain information and documentation – that is, by engaging in the conduct that comprises their contempt.[22]
[22]Cf. Gashi (No. 3) (no 20) [17].
On the one hand, I note the current case may be contrasted against serious instances of contempt whereby the contemnor’s conduct results in a criminal trial being adjourned and puts the community at risk.[23] On the other hand, I find the defendants’ actions were in deliberate defiance of court orders and processes. Further, their conduct has been continuous and unremitting, which aggravates the original breach. Their conduct to some extent delayed and frustrated the proceedings before Riordan J,[24] and risks undermining the authority of the Court, which I will address further below. In all the circumstances, I find that the defendants’ contemptuous offending should be regarded as serious.
[23]See e.g. R v Nationwide News Pty Ltd [2006] VSC 420 [6]; Vaysman v Deckers Outdoor Corporation [2011] FCAFC 17.
[24]See Hera Project Pty Ltd v Bisognin [2019] VSC 483 [7]–[27].
The actual consequences of the contempt
Counsel for the plaintiff submitted that the defendants’ non-compliance with the orders has harshly affected the plaintiff. It is argued that their failure to provide the documents and information has prevented the plaintiff from taking further steps to recover the alienated assets or otherwise protect its interests. It is submitted that, because of this, the plaintiff is now in real financial distress. The plaintiff highlights that the first freezing order was made in respect of assets up to the unencumbered value of $500,000, but estimates actual costs lost and incurred in the course of these proceedings would now be far higher.
While I do not, on the evidence before me, attempt to definitively quantify the monetary impact of the contempt, I accept that the plaintiff has suffered significant hardship due to the defendants’ conduct. I further note that the defendants’ actions in failing to comply with the freezing orders and attend hearings has wasted not an insubstantial amount of Court time and resources.
The effect on the administration of justice
The plaintiff submits that the defendants’ disobedience of court orders affects the administration of justice. It was argued that if a perception develops that freezing orders are able to be disobeyed with impunity, the ability of courts to effectively administer justice according to law may be significantly undermined.
Noting that the defendants were warned on a number of occasions that they faced jail sentences if they failed to comply with the court orders, the plaintiff also argues that a perception may develop that such statements need not to be taken seriously. In this way, it was argued the ability of courts to effectively administer justice according to law may be significantly undermined.
I agree with these submissions and find the defendants’ conduct has the effect of subverting the authority of the Court and the administration of justice.
The defendants’ personal circumstances and antecedents
There is meagre material before me about the defendants’ personal circumstances. Furthermore, I have not been provided with evidence that either of the defendants have any prior convictions or findings of guilt of any kind. In the circumstances, I proceed on the basis that neither has any prior history that adversely affects the defendants in respect to the penalty to be imposed.
I have noted that in the course of these proceedings, it has been suggested that Mr Bisognin suffered some physical and mental health concerns, and Mrs Bisognin may have been a ‘passenger’ in the course of these proceedings. However, I have also outlined the limitations of these submissions and the evidence provided in support of them. I further observe that these assertions were not able to be tested in court due to the defendants’ failure to attend or instruct a legal representative to appear on their behalf.
It is of considerable regret that there is almost no material before me as to the defendants’ personal circumstances or backgrounds, which might establish any circumstances to mitigate the penalty to be imposed. The failure of the defendants to engage with these proceedings has thus prevented matters that might have been put forward in their favour from being taken into account.
The defendants’ financial means
The material before me suggests the defendants have become bankrupt. However, no submissions or evidence were advanced to allow me to draw any conclusions as to the impact this may have had upon them.
The defendants’ culpability and reasons for their conduct
Importantly, no material has been put before me to explain the defendants’ offending, or their motivation for it. I have been provided no material that might assist in placing the offending in a different context or light, from their point of view.
In assessing the defendants’ degree of culpability, I am satisfied that they committed the contempts in a deliberate attempt to delay court proceedings and undermine the plaintiff’s interests. Their conduct occurred in circumstances where the plaintiff took action to protect its position following Riordan J’s determination in their favour, as there was reasonable cause for concern that they were dissipating their assets.[25]
[25]Hera Project Pty Ltd v Bisognin (No 7) [2017] VSC 439; Transcript of Proceedings, Hera Project Pty Ltd v Bisognin, (Supreme Court of Victoria, S CI 2018 02233), The Honourable Justice Riordan, 28 June 2018, 28 (Unrevised ruling).
I find the culpability of both of the defendants should be assessed as at a significant level, and their behaviour cannot be regarded as trivial, fleeting or of little consequence.
General contrition and apology
The only apology offered in the course of proceedings was that of Mr Bisognin in his affidavit sworn on 13 August 2018. The plaintiff submits this apology is undermined by its lateness and his continued non-compliance, and when viewed in the context of his broader behavior. It is further argued the plaintiff has been unable to test its genuineness through cross-examination due to the defendants’ non-attendance.
It appears the defendants have chosen to completely ignore these proceedings and all communications sent to them by the Court and the plaintiff. Their continued failure to attend and acknowledge the authority of the Court, has been to their considerable detriment, as it prevents me from concluding that they have shown any remorse for their offending.
Significantly, with the exception of Mr Stevenson’s limited submissions, no material has been provided to suggest that the contempt has been purged, or any apology has been offered for the offending. In all the circumstances, I am unable to conclude that the defendants are the slightest bit remorseful for their contemptuous conduct.
Specific deterrence, general deterrence and denunciation
The defendants’ actions have been to the serious detriment of the plaintiff, and have compromised the ability of this Court to administer justice. I find the sentence to be passed in this matter must contain a significant component directed towards general deterrence and denunciation, to deter others from carrying out similar conduct in the future that might have the tendency to interfere with and obstruct justice.
I proceed on the basis that neither of the defendants have any antecedents for contempt or related types of matters such as to increase the need for specific deterrence. Despite their prolonged and ongoing conduct in contempt of the relevant court orders, given the lack of information about their backgrounds, or which might indicate their future conduct, I am not sufficiently informed to make a conclusion as to the weight that should attach to the principle of specific deterrence. In the circumstances, I decline to make a finding about this sentencing factor.
Penalty
The penalty for contempt may consist of fines, imprisonment or both.[26] Where the contempt by breach of an order is casual, accidental or unintentional, the court may exercise discretion to impose no penalty.[27] Where contempt is considered criminal, as I have found it to be in this instance, the court may record a formal criminal conviction and is more likely impose a severe penalty, including imprisonment.[28]
[26]Supreme Court (General Civil Procedure) Rules 2015 (Vic) r 75.11.
[27]AMIEU v Mudginberri (no 9); Markisic v Commonwealth of Australia [2007] NSWCA 92; Advan Investments v Dean Gleeson Motor Sales [2003] VSC 201.
[28]CFMEU v Grocon (no 6) [173].
The plaintiff submits that the appropriate penalty to be ordered against the defendants in the current circumstances is a sentence of imprisonment. In support of this, the plaintiff points to the real and significant effect of their contempt on the plaintiff, the strength of the contempt case, their deliberate and defiant failure to rectify the breaches over a lengthy period of time, and the interests of justice.
The plaintiff initially proposed, in their written submissions of 30 January 2019, that a partial suspension of a prison sentence, conditional upon compliance with the relevant orders, may be appropriate. It was submitted that this penalty would reflect the need for specific and general deterrence, as well as performing a remedial and coercive function. However, at the hearing on 16 August 2019, the plaintiff argued the coercive purpose of imposing a penalty was reduced due the passing of time, as the harm to the plaintiff may no longer be able to be remedied. I outlined the changed purpose of proceedings at paragraphs [25]–[27] above.
The plaintiff further submits that a fine would not be an inappropriate penalty in the current circumstances as the defendants are bankrupt; and it would only further harm the plaintiff, who is the defendants’ major creditor. It is submitted that the imposition of a fine is not likely to have significant effect upon the defendants, and would thus be insufficient to vindicate the authority of the Court.[29] I take these submissions into account, although note that the fact that an offender is impecunious or bankrupt is not a basis for imposing a sentence of imprisonment where one would not otherwise be appropriate.[30]
[29]Citing Gashi (No 3) (no 20) [14], [17].
[30]Jones v Toben (No 2) [2009] FCA 477 [83]; Vaysman v Deckers Outdoor Corporation [2011] FCAFC 17 [54].
Finally, the plaintiff also submits that a suspended sentence would be inappropriate, as it would be an inadequate deterrence given the defendants’ blatant disregard for complying with court orders.
No submissions were advanced on behalf of the defendants’ in respect to penalty, despite the opportunity being afforded on multiple occasions.
Conclusions
The submissions and evidence advanced on behalf of the defendants, as outlined above, are so limited to have almost no impact on the sentencing equation. For providing no mitigatory material, the defendants have no-one to blame but themselves. I further note that I have been provided with no material that distinguishes between the personal circumstances, or the level of culpability for the contempts, of one defendant as against the other, which might lead to different sentences being passed in respect to each.
Taking into all the pertinent matters, I conclude that each instance of contempt committed by each of the defendants was deliberate and contumacious, and should be regarded as being criminal in nature. In all the circumstances, I find that convictions ought be recorded against each of them and that they should be sentenced to serve a period of imprisonment. I do not consider that declining to impose a penalty, or imposing a monetary penalty, are options that are open in this matter. Further, I am aware that the court must not impose a custodial sentence where a non-custodial sentence would achieve the purposes for which the sentence is to be imposed. For the reasons I have expressed, I find that in the case of the two defendants no other penalty than custodial sentences would achieve the purposes of the sentence to be imposed for the conduct they have carried out.
The Court has unfettered discretion to award costs against a contemnor.[31] It is common practice in contempt proceedings, however, for costs to be awarded against the contemnor on an indemnity basis.[32]
[31]Supreme Court (General Civil Procedure) Rules r 75.14.
[32]Gashi (No 3) (no 20) [20]; Fortune Holding Group Pty Ltd v Zhang (No 3) [2018] VSC 22.
The plaintiff submits that costs should be awarded against the defendants on an indemnity basis, given the nature of this proceeding and the defendant’s continual non-compliance with court orders.
Given all the circumstances I conclude it is appropriate that the defendant pay the plaintiffs’ costs of the proceeding, including any reserved costs, on an indemnity basis.
Orders
The final orders I will pronounce are these:
(a) Gino Andrew Bisognin is adjudged guilty of contempt of court in that, he:
(i) failed to provide the information or documents required by paragraphs 6(a)–(c) of the first freezing order in breach of that order; and
(ii) failed to provide the information or documents required by paragraphs 1–3 of the second freezing order in breach of that order;
and is convicted and sentenced to six months’ imprisonment.
(b) Leah Joan Bisognin, is adjudged guilty of contempt of court in that, she:
(i) failed to provide the information or documents required by paragraphs 6(a)–(c) of the first freezing order in breach of that order; and
(ii) failed to provide the information or documents required by paragraphs 1–3 of the second freezing order in breach of that order;
and is convicted and sentenced to six months imprisonment.
(c) Pursuant to Rule 75.13 of the Supreme Court (General Civil Procedure) Rules 2015, two warrants, in the form attached hereto, be issued to arrest each Gino Andrew Bisognin and Leah Joan Bisognin, and take them to prison and deliver them to the Governor of that prison.
(d) Gino Andrew Bisognin and Leah Joan Bisognin pay the plaintiffs’ costs of and incidentals to the proceeding, including any reserved costs, on an indemnity basis.
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