FEDERAL COURT OF AUSTRALIA
Jones v Porter [2022] FCA 1219
File number(s): NSD 169 of 2021 Judgment of: CHEESEMAN J Date of judgment: 14 October 2022 Catchwords: PRACTICE AND PROCEDURE – where the competency of the appeal from a decision of the then Federal Circuit Court to refuse an application for an inquiry under s 90-15 of the Insolvency Practice Schedule (Bankruptcy), Sch 2 to the Bankruptcy Act 1966 (Cth) into the administration of the bankrupt estate was challenged by the respondents – whether leave to appeal required – whether judgment below is interlocutory or final – Held: appeal dismissed as incompetent. Legislation: Bankruptcy Act 1966 (Cth), ss 30, Sch 2, 90-10
Federal Court of Australia Act 1976 (Cth), ss 24(1)(d), 24(1A)
Insolvency Law Reform Act 2016 (Cth)
Cases cited: Bienstein v Bienstein [2003] HCA 7; 195 ALR 225
Carr v Finance Corporation of Australia Ltd (No 1) [1981] HCA 20; 147 CLR 246
Ferella v Official Trustee in Bankruptcy [2013] FCAFC 43
Frigger v Trenfield (No.10) [2021] FCA 1500; 397 ALR 24
Hall v Poolman [2009] NSWCA 64; 75 NSWLR 99
Johnson Tiles Pty Ltd v Esso Australia Pty Ltd [2000] FCA 1572; 104 FCR 564
Macchia v Nilant [2001] FCA 7; 110 FCR 101
Re Media, Entertainment and Arts Alliance; Ex parte Hoyts Corporation Pty Ltd [1994] HCA 66; 119 ALR 206
O’Neill v Piscopo (No 3) [2012] FCA 1036
Plaintiff S164/2018 v Minister for Home Affairs [2018] HCA 51; 361 ALR 8
Re Alafaci; Registrar in Bankruptcy v Hardwick (1976) 9 ALR 262
Division: General Division Registry: New South Wales National Practice Area: Commercial and Corporations Sub-area: General and Personal Insolvency Number of paragraphs: 39 Date of hearing: Determined on the papers. Counsel for the Appellant: The appellant is self-represented in the proceedings. Counsel for the Respondents: Mr A Spencer ORDERS
NSD 169 of 2021 BETWEEN: RICHARD JONES
Appellant
AND: JASON PORTER
First Respondent
PAUL WESTON
Second Respondent
ORDER MADE BY:
CHEESEMAN J
DATE OF ORDER:
14 OCTOBER 2022
THE COURT ORDERS THAT:
1.The appeal be dismissed as not competent.
2.The appellant pay the respondents’ costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
CHEESEMAN J:
INTRODUCTION
These reasons address an objection to the competency of an appeal from a judgment of the Federal Circuit Court (now the Federal Circuit and Family Court of Australia) in which the Circuit Court refused to order an inquiry into the administration of the appellant’s bankrupt estate: Jones v Porter [2021] FCCA 234 (PJ).
The proceedings in this Court have a protracted history. The conduct of the proceedings has been impacted by the arrangements put in place to manage the…
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- AGLC
- Jones v Porter [2022] FCA 1219
- Case
- [2022] FCA 1219
- Decision Date
CaseChat Overview and Summary
The court considered the relevant statutory provisions and relevant case law, including authorities relating to the former section 179 of the Bankruptcy Act and the former section 536 of the Corporations Act. The court held that the decision of the primary judge to refuse an inquiry under section 90-10 of schedule 2 to the Act was an interlocutory decision. As such, leave to appeal was required, and the appeal was deemed incompetent because Mr Jones had not sought leave to appeal. The court dismissed the appeal and ordered that the appellant pay the respondents' costs.
The court found that the decision of the primary judge did not preclude a further application for an inquiry being brought in the future. The authorities relied on by the respondents demonstrated that decisions made under similar provisions in the past were interlocutory. Mr Jones' argument that the decision should be characterised as final was rejected, as the court found no legal basis to preclude a future application. Consequently, the appeal was dismissed, and the appellant was ordered to pay the respondents' costs.
Orders
Orders of the court
1. The appeal be dismissed as not competent.
2. The appellant pay the respondents’ costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
The trustees relied on authority in respect of the now repealed s 179 of the Bankruptcy Act 1966 (Cth), the predecessor of s 90-10. Those authorities determined that decisions made under s 179 in relation to an inquiry into the conduct of the bankruptcy trustee were interlocutory and thus attracted the requirement for leave to appeal. The trustees also relied on authority to similar effect in relation to the analogous provision in respect of an inquiry into the conduct of a liquidator under the now repealed s 536 of the Corporations Act 2001 (Cth). Mr Jones sought to distinguish the authorities relied on by the respondents in respect of the former s 179. His principal contention was that the primary judge’s decision should be characterised as final because the orders made by the primary judge dismissed the application for an inquiry “in toto”. He further submitted that, contrary to the respondents’ contention, the primary judge’s decision precluded him from bringing a further application for an inquiry into the trustees’ conduct and that was another reason that the decision should be characterised as final. Section 30(2) of the Act relevantly provides:(2)The Court may direct such inquiries to be made and accounts to be taken for the purposes of any proceeding before the Court as the Court considers necessary and may, when directing an account to be taken, or subsequently, give special directions as to the manner in which the account is to be taken or vouched. Section 90-10 of the Insolvency Practice Schedule (Bankruptcy), schedule 2 to the Act, relevantly provides:(1) The Court may, on the application of a person mentioned in subsection (2), inquire into the administration of a regulated debtor’s estate.(2) Each of the following persons may make an application for an inquiry:(a) a person with a financial interest in the administration of the regulated debtor’s estate;(b) if the committee of inspection (if any) so resolves—a creditor, on behalf of the committee;(c) the Inspector‑General.… Section 90-10 was introduced into the Act by the Insolvency Law Reform Act 2016 (Cth), with one of its objects being to create common rules applicable to both corporate and personal insolvencies. The introduction of common provisions in the Corporations Act and the Act means that decisions under each legislation are of assistance in the application of the other: see Borg v de Vries (Trustee), in the matter of the Bankrupt Estate of David Morton Bertram [2018] FCA 2116 at [24]–[28]; Frigger v Trenfield (No.10) [2021] FCA 1500; 397 ALR 24 at [552]. Prior to the introduction of the Insolvency Practice Schedule (Bankruptcy) (which is schedule 2 to the Act), the power of the Court to order an inquiry was contained in s 179(1) of the Act. Section 179(1) provided:179 Control of trustees by the Court(1) The Court may, on the application of the Inspector‑General, a creditor or the bankrupt, inquire into the conduct of a trustee in relation to a bankruptcy and may do one or both of the following:(a) remove the trustee from office; and(b) make such order as it thinks proper.