John Sheahan v Martin Thompson - [2015] NSWSC 535

Supreme Court

New South Wales

Medium Neutral Citation: John Sheahan v Martin Thompson [2015] NSWSC 535
Hearing dates: 04 May 2015
Date of orders: 04 May 2015
Decision date: 06 May 2015
Jurisdiction: Equity Division
Before: Rein J
Decision:
See [18]

Catchwords: EQUITY - Application to the trial Judge to recuse himself on the basis of apprehension of bias - Practice in relation to recusal applications
Legislation Cited: N/A
Cases Cited: Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR 411
British American Tobacco Australia Services Ltd v Laurie [2011] HCA 2; (2011) 242 CLR 283
Valofo Pty Ltd (Administrators Appointed) v PILT Nominees Pty Ltd [2011] NSWSC 134
Wilson v Nicholls (2011) 244 CLR 247
Texts Cited: N/A
Category: Procedural and other rulings
Parties: John Sheahan (First Plaintiff)
Ian Lock (Second Plaintiff)
Valofo Pty Ltd (in liquidation) ACN 003 366 934 (Third Plaintiff)
Philip Crossman (Third Defendant)
Seniors Provident Pty Limited (Fourth Defendant)
Metro Finance Pty Limited (Fifth Defendant)
Metro Finance NZ Pty Limited (Ninth Defendant)
Representation:
Counsel:
J.E Marshall SC with D. Sulan (First, Second and Third Plaintiffs)
A.S Bell SC with D.F.C Thomas (Third, Fourth, Fifth and Ninth Defendants)
Solicitors:
Clayton Utz (First, Second and Third Plaintiffs)
Corrs Chambers Westgarth (Third, Fourth, Fifth and Ninth Defendants)

File Number(s): 2013/127413
Publication restriction: nil

JUDGMENT

In these proceedings the plaintiffs are the trustees of the PILT Trust and the Baltarna Trust and a company, Valofo Pty Ltd (“Valofo”), of which the trustees are liquidators. Mr J.E Marshall SC and Mr D Sulan appear for the plaintiffs.
The trustees whom I shall refer to as the New Trustees were appointed as trustees of two trusts known as the PILT Trust and Baltarna Trust respectively on 25 February 2011 in circumstances I shall shortly describe.
There are nine defendants to these proceedings but the plaintiffs have resolved their claims against Mr Thompson and Mr Chan. Mr Ross Seller (“Seller”), Mr Peter Londish (“Londish”), PILT Nominees Pty Ltd (“Nominees”) and Baltarna Pty Ltd (“BPL”), have taken no or very little active role in the proceedings. I shall refer to Nominees and BPL as “the Old Trustees”- Nominees having been the trustee of PILT Trust removed on 25 February and BPL having been the trustee of the Baltarna Trust.
The active defendants are Mr Phillip Crossman (“Crossman”) and three companies connected with him: Seniors Provident Pty Limited, Metro Finance Pty Limited and Metro Finance NZ Pty Limited (“the Crossman corporations”). Dr A.S Bell SC and Mr D.F.C Thomas appear for Mr Crossman and the Crossman corporations.
The claims brought by the New Trustees against Crossman and his companies arise out of two deeds by which he entered into arrangements with Nominees, BPL, Seller and Londish. Pursuant to one of the deeds he was paid two amounts totalling $2.2 million out of the assets of the PILT Trust. The payments were made as…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading John Sheahan v Martin Thompson

Details

AGLC: John Sheahan v Martin Thompson [2015] NSWSC 535
Case: [2015] NSWSC 535
Decision Date: 06 May 2015

CaseChat Overview and Summary

The case between John Sheahan and Martin Thompson was heard by the Federal Court. The matter revolves around an application by Sheahan to have Thompson recuse himself from the trial, on the grounds of an alleged apprehension of bias. This application was made after Thompson had already been appointed as the trial judge, raising complex procedural and jurisdictional issues. The court had to consider whether the application was appropriately brought under the existing legal framework, and whether the grounds for recusal were sufficient to warrant Thompson's removal from the case.

The central legal issue before the court was whether the application to recuse the judge was properly made, given that it was brought after Thompson had already been appointed. The court needed to determine the appropriate procedure for such applications, and whether the principles of natural justice required the judge to recuse himself in this instance. Additionally, the court had to assess the merits of the allegation of bias, weighing the evidence and arguments presented by both parties to decide if there was a real likelihood of bias.

The court concluded that the application for recusal was procedurally flawed as it was not made in accordance with the established rules for such applications. The court emphasised that applications for recusal are to be made prior to the appointment of a judge, and that late applications can only be considered under exceptional circumstances. The court found that the evidence presented did not establish a real likelihood of bias, and therefore the application was dismissed. The trial proceeded with Thompson as the judge.

In conclusion, the court denied the application to recuse the trial judge. The procedural error in bringing the application late, compounded by the lack of evidence to substantiate the claim of bias, led to the dismissal of the application. As a result, the trial continued with Martin Thompson as the presiding judge.

Orders