Hudson v Whalan

[2000] HCATrans 74

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S40 of 1999

B e t w e e n -

ROBERT HUDSON (Jnr)

Applicant

and

STEPHEN WILLIAM MICHAEL WHALAN

First Respondent

THOMAS JAMES DONALD

Second Respondent

Application for special leave to appeal

GLEESON CJ
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 MARCH 2000, AT 11.07 AM

Copyright in the High Court of Australia

MR R. HUDSON:   Appeared in person.

MS R.N. WINFIELD:   I appear for the respondents in this matter.  (instructed by Tonkin Drysdale & Partners)

GLEESON CJ:   Yes, go ahead.

MR HUDSON:   Thank you, your Honour.  What do I do now?

GLEESON CJ:   Go ahead, speak.  Say whatever you wish to say.

MR HUDSON:   Your Honour, what I have done, instead of taking up too much of the Court’s time, is I have prepared an oral part of my argument by way of affidavit and I would like to hand that up to you.  One copy each and one for the ‑ ‑ ‑

GLEESON CJ:   Yes, thank you.  We will read that.

MR HUDSON:   I am an unrepresented person and not competent to discuss the legalities of facts or law or arguments outlined at length in the authorities and statutory material in my applicant’s supplementary summary of argument and index to the applicant’s statutory material.  All that I can do as a citizen who feels that justice has not been done nor seen to be done is to state why I feel this state of affairs exists and I must leave it to the honourable Court to advise me on whether legalities support or deny my contentions.

I respectfully submit that the power conferred by section 153B of the Bankruptcy Act to annul the applicant’s bankruptcy has been enlivened.  I say this is so because any binding agreement or arrangement of the kind to which the applicant has referred would mean that the sequestration order ought not to have been made.

It is my contention that the respondents, well knowing that I am a pensioner in receipt of a disability social security payment and that they knew they had no hope of securing money or recompense, instituted a bankruptcy proceedings for political opportunity, namely in the attempt to damage my private and political reputation.  They have also bought my father into that, your Honours, because he has an identical name to myself and we live at the same address and he is 82 and when he rings up to get someone to come and do something he has got to explain to them that he is not Hudson Jnr.  So that is the other bit that I would try to get this straightened out for.

The respondent’s actions, they subsequently ensured that Gosford City Council paid their legal expenses so they were not at a financial disadvantage themselves, although they had succeeded in their first intent to secure a bankruptcy order.  They also sought, successfully, as the Court noted, to prevent myself from having access to the subpoenaed Council records which may have shown that this repayment or reimbursement agreement of their costs occurred prior to the date of 19 May which was the sequestration date of the order.

Consequently, section 41(5), I believe, can now be brought into play as the courts have stated if the respondents did not suffer loss from non‑payment of their legal expenses because Council had agreed verbally to pay the respondents prior to 19 May the respondents’ past and future legal fees.  Therefore there was an agreement in place of some description and I will get to that.

The second ground on which Lindgren J refuses annulment is that there is a community interest in not turning an undischarged bankrupt loose in the community if there is a possibility that this process of becoming insolvent repeatedly is a likely event.  It has not been shown, and there is no evidence that can be presented, that I or the applicant is such a person.

The layman’s view also held by observers in the area at home in Gosford, which I suppose cannot be tendered in this Court, is that the bankruptcy was launched with the intent to damage the applicant and not content with the respondents being councillors, ensured that Council, that is the ratepayers paid their bills in full.  This does not appear as natural justice being implemented.

Your Honours, my appeal as an ordinary citizen, unendingly seeking relief from what I perceive to be an unjust order rests on my propositions, whatever their legal status.  The bankruptcy petition ought not to have been lodged nor the hearing of May 19 granted, after the date on which the respondents had secured an agreement with Gosford City Council for the reimbursement of all their past, present and future legal expenses.

Had the applicant been able to detect and agitate these points, maybe this matter may never have reached the High Court.  Under these circumstances, the annulment sought by the applicant at the time ought to have been granted and justice carried out. 

The little bit there is just a chronology, your Honours.  This business about them resigning from Council, which they did on the 3rd; they did not resign, they walked out of Council and then came back 45 minutes later after I compromised and sat outside where I could still hear everything but I did not want the people to suffer, the people who had come up to have their DAs heard.

I then on the 10th – it was common knowledge on both nights, on the following 10th as you can see there that these people had stated that they were going to resign from Council and not come back unless they could be reimbursed.  Now that was common knowledge.  It was all the rage around the gallery on the night.  As I said I then offered, on page 4, a compromise to allow those waiting to have their DAs processed that I sat in the foyer and take whatever notes I needed from there and that I would not compromise myself any further.  It took 40 minutes before the councillors concerned returned.

Well the rest is again – on the following week I was contacted by councillor Malcolm Brooks officially on behalf of the mayor and to see if I would not attend the Council chamber on Tuesday, 10 March 1998 as all five councillors involved in the original Local Court case had contacted the mayor and said the moment I walked into the chamber on 10 March 1998 they would walk out and not return to the chamber, which they did on the night leaving the mayor stranded with no quorum and many very angry ratepayers in the public gallery who could not get their business transacted.

I believe the whole sequence of the third - events was a deliberate action of blackmail of their fellow councillors and staff by all five councillors to ensure legal payment of their past and future expenses, which is evident in paragraph 3 of the letter which is marked “A”.  Yes, paragraph 3 of a letter of the annexures and it is a letter from Mr Donnellan & Co.  He is the solicitor to Gosford City Council and it is addressed to the General Manager and dated 4 March, the very next day, your Honours.

You will find I have highlighted some of these letters just for ease of your picking out the bits that I am referring to:

They have indicated that they will not attend Council meetings whilst the instigator of that litigation is in the Council Chamber and that they will resign if the Council cannot provide them with some assurance that they will be protected from similar actions in the future.

Well, in brief and I will refer back to this again afterwards, they never resigned and they got paid and I am still saying that this agreement, whilst you and I and the Court cannot see it in physical evidence, there was a gentleman’s agreement of some description entered into.  The actual reports were prepared by the general manager.  I believe that the strategy side of it was worked out by the hierarchy of Council to save Council from the position it was in.

Now, I go down on page 9 to annexure “B”, your Honours.  There is a second, sorry, bit on number “A” on page 2 about halfway down.  It states they are:

expenses incurred by Councillors in the carrying out of the Council’s business not their own, even though, as it is in this case, the carrying on of their own business has important consequences for the Council business.

They have stated all the way through in a number of places that these people should not have been paid because they were carrying out their own private business and that is all the bankruptcy was.

Now, we are over to annexure “B” and it is again marked there.  It is a confidential memo to the mayor, Councillor Holstein from the General Manager dated 6 March and in there it says:

I refer to your memo of 4 March 1998 regarding the Council meeting held on Tuesday 3 March 1998 and your request that I seek legal advice and advice from the Department of Local Government on any action that can be undertaken to ensure the affected councillors are not encouraged by the actions of Mr Hudson to resign –

and then down to the bottom of that again there is a bit there that states that they were carrying out:

and expenses incurred by Councillors in the carrying out of the Council’s business not their own –

They could get paid because they were carrying out as they were actually in office carrying out - which they were in office but they just had not had time to do it.  All this arose, basically, out of a challenge in the Local Court, your Honours, against some irregularities in the 1995 Council elections and then there was a court order for costs for these two respondents granted and I immediately, in my layman’s terms, not in what legal terms I have been told I should have done, I queried the legal people for those two respondents on the $600.

There was $600 given to them by error by Magistrate Cocks for witness fees.  Now, those gentlemen had been there.  They also got paid for being there.  They got their legal expenses, in other words, and then Magistrate Cocks mistakenly – somebody suggested witness fees and they were given $600 extra and that is where the other bone of contention is.  I have been asking and saying that the bankruptcy notice was flawed because of that extra $600 which they are not entitled to.

There is - and I did not bring it with me today, but their solicitor or their legal representative of the day did ask Magistrate Cocks could they remain in the court because all of their witnesses were members, were in the court at the time and they were asked to go to a certain room and Mr Donnellan, I think it may have been, the solicitor, asked on the day could these two respondents remain in the room as they will not be giving testimony on the day and Magistrate Cocks granted that wish.  It is in the record.  I think it is even in the other documents that I have tendered to the Court.

Then, on annexure “C”, halfway down, that is from another letter from Mr Donnellan on 16 March to the General Manager:

That is not to say there would not need to be justification for the Council passing such a resolution so that it could be seen as reasonable and just in the circumstances and, moreover, in the public interest.

Now, I have been saying, because this whole thing was funded – I am only a pensioner and I did not have the money to start any of the cases off, your Honours, and the public got behind me up there - not large amounts of money but quite a few and they helped finance the issue and then when, on July 7, when the mayor on that second case that we had going, won his robes back through appeal in the Supreme Court, the money started to dry up and I was left then high and dry to battle it.  I will never take another thing on in my life for the community unless I have got half a dozen names on the document with me.

But that is just – they are saying it is in the public interest and I am saying that the public that supported us and the whole matter was contentious.  Also on page 3 of that letter – I am going to come to a point, now, that this amount of money of $87,119.30 being the fees for all five of the councillors up until 15 May 1998.  It was never put out for public scrutiny.  It was never ever recorded in the Council’s normal quarterly court - where they have the court bits in their business papers.  It was never recorded in that and, therefore, nobody knows about it except it was in the press.  The press let it leak once and then that was it.  Then, Mr Donnellan also says:

I don’t mind saying, Peter –

and, Peter is the general manager of the Council, Peter Wilson –

that I have some trouble coming to grips with unassailable arguments for reimbursement in these circumstances –

That is on page 3, too.  Then I come over to annexure “D”.  It is an interoffice memorandum:

To:  Program Manager – Administration/Finance
From:  Legal Officer.

That is Mr Alan Ford - he is the Council’s internal legal officer – dated 22 June 1998, and again to say that there was some sort of shenanigans and fraud and everything going on up there.  He has asked him to:

Please create an expenditure vote for those legal costs and an income vote for the legal costs.

They have gone and hidden 50 per cent of that $87,000-odd in general fund, 25 per cent in the water supply fund and 25 per cent in a sewerage.  Still, the public do not know that they have been penalised.  Then on the 10th, on annexure “E”, we come over – we appeared before Justice Hill on 18 August 1998, I think it was.  Was it 1998 or 1999?  I have just forgotten.  Any way, the clients, the respondents turned up to that and were still saying to the court that I was still in debt to them when, clearly, there is a Gosford City Council cheque voucher made out on 10 August for the sum of $34,719, and some odd cents, may be - that is the way photocopies work – to them.  Now, I do not know what date.  I presume they may have got that some time afterwards.

But, then you come to annexure “F”.  It is a letter from Tonkin Drysdale Partners dated 19 August 1998, “Attn Mr A. Ford” the internal solicitor for Council.

We refer to the above matter and write to confirm our clients’ discussions with Council.

Now, the important bit there is their “clients’ discussions”.  Their clients were elected members of Council.  Now, I have been saying all along that quite a number of people up home have been saying that there has been private discussions going on behind closed doors and in the confidential sessions and we have been denied access to those discussions and those discussions featured around the 3rd and the 10th and then progress to the point that these people never ever resigned and even though I was attending all the meetings – I have a very good attendance record up until about October last year - I had a bit of an accident –  and they had never ever mentioned, publicly, anywhere, that they would resign if they were not being paid.

So that, again, just the not resigning tells me that they did – and by the cheque vouchers and the different other things that are here tells me that there is a prima facie case, or at least I am hoping there is a prima facie case there for an appeal for the whole thing so that we can take the whole thing to a full appeal and see what we can do to fix it up for once and for all.  On the bottom of that letter it states:

our clients subrogate to Council their rights as creditors against Mr Hudson pursuant to the various cost orders made in the above matters.

I have never heard of it.  I have never heard anything from them and neither has any of the courts that they have been paid by a cheque on the 10th or neither have I or – heard anything about that letter.  Then there is annexure “G” which is a letter, again, from Mr Ford to Mr Tonkin Drysdale which explicitly shows the exact amounts of money.  That is on the 20th and that cheque, it is stated, will be put in “your trust fund shortly”.  Then you go over to the next annexure which “G”, I think, if I remember – part of that one for “G”, I should say – is a copy of Westpac’s Council’s bank statement for 24 August and it shows a withdrawal cheque of $34,719.41.

Basically, all I am saying is that there has been deals done behind closed doors.  These people have not run a straight race, in a sense, and we and the residents up there would like to get this straightened out once and for all and every time I seem to have to come to court I am at a disadvantage all the time.  These people have barristers, solicitors and that, which they are entitled to, and they have got a bottomless pocket.  There is a clause in one of the agreements on – I think it could be 2 June – that should they incur further costs after the initial $87,119.30, that if they make application to Council, Council will reimburse them for that, too.

So, I presume, even now, that one of these gentlemen did not get re‑elected and the other fellow did not stand, he moved to Queensland.  And, now that they are nothing to do with Council I presume they are still getting paid by Council.  I would like to get that one straightened out because this – I do not know where it is going to end up.  I do not know if there is anything else I can say, your Honour.  That is just ‑ ‑ ‑

GLEESON CJ:   Thank you, then.  Thank you, Mr Hudson.

MR HUDSON:   It is just that there is one page, page 57 of the application book.  I go down to Part iii and it is a quote out of Justice Sackville, Hely and North’s judgment:

Later cases have adopted this analysis;  Re Ex parte Gollan (1992) ‑ ‑ ‑

GLEESON CJ:   Thank you, your time is up.

MR HUDSON:   You have read that?

GLEESON CJ:   Your time is up.

MR HUDSON:   Pardon?

GLEESON CJ:   Your time is up.  Your time is up.  You are finished.  Thank you.

MR HUDSON:   I see.  Thank you.

GLEESON CJ:   We do not need to hear you, Ms Winfield.

The Court is of the view that there is insufficient reason to doubt the correctness of the decision of the Full Court of the Federal Court of Australia to warrant a grant of special leave to appeal in this matter.  The application for leave to appeal is refused. 

Can you resist an order for costs?

MR HUDSON:   Pardon?

GLEESON CJ:   Can you resist an order for costs?

MR HUDSON:   I have got a notice of motion that I would ask the Court under – and an affidavit: 

(1)  That the applicant does not –

I am not seeking costs myself.  I am not seeking any costs in this matter.

GLEESON CJ:   An application is made against you that you pay the costs of the respondent of this application.  Do you have anything to say as to why you should not?

MR HUDSON:   Yes, your Honour.  I would like to hand this notice of motion of up.

GLEESON CJ:   No, we will not deal with it by notice of motion.  If there is anything you want to say as to why you should not pay their costs, now is your opportunity to say it.

MR HUDSON:   Well, what I am going to do is if you would indulge me, I swore an affidavit here this morning and that has everything in it that I wish to say, your Honour.

GLEESON CJ:   All right.  Let us have a look at that.

MR HUDSON:   That is one for starters.  What have I done with the others?

GLEESON CJ:   You only need two.

MR HUDSON:   There you are, there is another two.  The front part is not filled out, your Honour.  I do not think – request a notice of motion any way.  The only thing I would like to say is that Justices Sackville, Hely and North did not – because they felt, I think, that it was brought by the community by myself as a petitioner.  I have got no personal gain in it.  I appeared before a coram of Justice Meagher and Justice Sheppard in an appeal there and there was no costs ordered against me and there has been, again, on 11/3/98 in a Full Court and there was no orders ordered against me there.  Justice Hill did and maybe one or two others in the courts below, but I would ask for those reasons, for which I do not fully understand are involved in that there, but as a member of the community and somebody who does a lot of community work gets out – and that is all I have ever done – and I have stood for Council on three occasions to support people of my own age group and the people around me at my own expense, and I feel that being penalised like this has been a great hindrance to me and it has caused my health to suffer too.  That is why I could not continue last year.  I just had to stop everything about October.  I was told by the doctors I had to do that or stop myself.  Thanks, your Honour.

GLEESON CJ:   By bringing this application, the applicant has put the respondent to substantial legal cost.  The Court is of a view that the applicant must pay the respondents’ costs of the unsuccessful application.

AT 11.32 AM THE MATTER WAS CONCLUDED