Kelly v Mosman Municipal Council
[2009] FMCA 706
•16 July 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| KELLY v MOSMAN MUNICIPAL COUNCIL | [2009] FMCA 706 |
| BANKRUPTCY – Practice & Procedure – interim application to transfer proceedings to the Federal Court – applicant seeking to have matter tried before a jury pursuant to s.30(3) of the Bankruptcy Act 1966 (Cth) – application dismissed. |
| Acts Interpretation Act 1901 (Cth), s.15A Bankruptcy Act 1966 (Cth), s.30(3) Federal Magistrates Act 1999 (Cth), s.39 Federal Magistrates Court Rules 2001 (Cth), r.8.02 Imperial Acts Application Act 1969 (NSW), ss.36, 37 Judiciary Act 1903 (Cth), ss.39, 78B |
| Harding v Deputy Commissioner of Taxation [2008] FCA 1403 Pape v The Commissioner of Taxation [2009] HCA 23 Re Shields; Ex parte Australia and New Zealand Banking Group Ltd (1994) 51 FCR 308 Richmond v BMW Australia Finance Limited (No.2) (2009) 254 ALR 76 |
| Applicant: | DAVID KELLY |
| Respondent: | MOSMAN MUNICIPAL COUNCIL |
| File Number: | SYG 600 of 2009 |
| Judgment of: | Lloyd-Jones FM |
| Hearing date: | 16 July 2009 |
| Delivered at: | Sydney |
| Delivered on: | 16 July 2009 |
REPRESENTATION
| Applicant: | Mr D. Kelly appeared as a self represented litigant with the assistance of a McKenzie friend |
| Counsel for the Respondent: | Mr J.E. Lazarus |
| Solicitors for the Respondent: | Pikes Lawyers |
ORDER
The interim application filed in Court on 16 July 2009 is dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 600 of 2009
| DAVID KELLY |
Applicant
And
| MOSMAN MUNICIPAL COUNCIL |
Respondent
REASONS FOR JUDGMENT
New proceedings
An interim application was filed in the Federal Magistrates Court of Australia by David Kelly (the applicant) at the commencement of the final hearing of the substantive issue to set aside a Bankruptcy Notice. The interim application sought the following order:
That the Federal Magistrates Court desist from further hearing of this matter and remit it to the Federal Court so that the applicant may apply for a jury trial under s.30(3) of the Bankruptcy Act 1966.
The original application was filed on 12 March 2009 and listed for hearing today. That application seeks final orders that the Bankruptcy Notice NN445 of 2009 be set aside. An affidavit of David Kelly filed in support of the original application indicates that he has a disability, being dyslexia, and relies on assistance to help him read. Mr Kelly states that he was handed an envelope on 20 February 2009 in Roseberry Lane, Mosman, New South Wales, which he passed unopened to his assistant, Lydia Williams, on 28 February 2009. Mr Kelly claims that on that date he became aware that the envelope contained a Bankruptcy Notice together with a Notice of Motion filed by Mosman Municipal Council (the respondent) in the Land and Environment Court of New South Wales.
Mr Kelly states that the judgment which forms the basis of the Bankruptcy Notice was made in the Land and Environment Court on 19 February 2007 in matter number 40967 of 2006. Mr Kelly claims that he was denied the opportunity to appear before that Court to answer allegations made against him by Mosman Municipal Council. He also claims that he was not duly served with the judgment/orders of that Court. Mr Kelly states that he is solvent and has funds to cover the costs on that judgment, which are held by his lawyers in trust. Mr Kelly states that he intends to appeal the decision of the Land and Environment Court.
Submissions by Mr Kelly
At today’s hearing, Mr Kelly through the assistance of a McKenzie friend sought to have the substantive matter transferred to the Federal Court because he says there is a constitutional issue to be raised and that he wants the opportunity to have a jury trial. Section 30(3) of the Bankruptcy Act 1966 (Cth) gives an applicant the right to ask for a jury trial but that the presiding judicial officer has the discretion to grant the request.
Mr Kelly indicated that he sought clarification in respect of the reach of ss.36 and 37 of the Imperial Acts Application Act 1969 (NSW), which he says would tend to be an answer to the claim by the Mosman Municipal Council to jurisdiction over his land. He believes that this is an important enough issue for a transfer to the Federal Court.
Mr Kelly advised the Court that he was unrepresented at this hearing as his counsel had a death in the family. However he intended to retain counsel for future hearings.
Submissions on behalf of the Respondent
Mr Lazarus, appearing for the respondent, referred to s.39 of the Federal Magistrates Act 1999 (Cth) which states:
(1) If a proceeding is pending in the Federal Magistrates Court, the Federal Magistrates Court may, by order, transfer the proceeding from the Federal Magistrates Court to the Federal Court or the Family Court.
(2) The Federal Magistrates Court may transfer a proceeding under this section:
(a) on the application of a party to the proceeding; or
(b) on its own initiative.
(3) In deciding whether to transfer a proceeding to the Federal Court under subsection (1), the Federal Magistrates Court must have regard to:
(a) any Rules of Court made for the purposes of subsection 40(2); and
(b) whether proceedings in respect of an associated matter are pending in the Federal Court; and
(c) whether the resources of the Federal Magistrates Court are sufficient to hear and determine the proceeding; and
(d) the interests of the administration of justice.
Mr Lazarus submits that the discretion this Court has to transfer a matter to the Federal Court is constrained by the Federal Magistrates Court Rules 2001 (Cth) and in particular r.8.02 which states:
8.02 Transfer to Federal Court or Family Court
(1) The Court may, at the request of a party or of its own motion, transfer a proceeding to the Federal Court or the Family Court.
(2) Unless the Court otherwise orders, a request for transfer must be made on or before the first court date for the proceeding.
(3) Unless the Court otherwise orders, the request must be included in a response or made by application supported by an affidavit.
(4) In addition to the factors required to be considered by the Court under subsections 39 (3) and (4) of the Act for transfer of proceedings to the Federal Court or the Family Court, the following factors are relevant:
(a) whether the proceeding is likely to involve questions of general importance, such that it would be desirable for there to be a decision of the Federal Court or the Family Court on one or more of the points in issue;
(b) whether, if the proceeding is transferred, it is likely to be heard and determined at less cost and more convenience to the parties than if the proceeding is not transferred;
(c) whether the proceeding will be heard earlier in the Federal Magistrates Court;
(d) the availability of particular procedures appropriate for the class of proceeding;
(e) the wishes of the parties;
(f)…
Mr Lazarus indicated that the stated reason for the proposed transfer is so that an application may be made for a jury trial under s.30(3) of the Bankruptcy Act which states:
30(3) If in a proceeding before the Federal Court under this Act a question of fact arises that a party desires to have tried before a jury, the Federal Court may, if it thinks fit, direct the trial of that question to be had before a jury, and the trial may be had accordingly in the same manner as if it were the trial of an issue of fact in an action.
Mr Lazarus submits that the power of the Federal Court in relation to the ordering of a jury trial is constrained to determining issues of fact. He says this makes obvious sense because it has long been established that matters of law are within the repository of a judicial officer. However assuming that there is a question of fact, there would have to be a very good reason for a jury trial to be ordered. Mr Lazarus argues that an application under s.30(3) of the Bankruptcy Act is bound to fail and hence Mr Kelly’s application for a transfer should be refused. In support of this contention, Mr Lazarus referred to the decision in Harding v Deputy Commissioner of Taxation [2008] FCA 1403 per Flick J which he submits is the most recent consideration of the issue. The facts of that case were that bankruptcy proceedings were on foot in the Federal Court and an application was made under s.30(3) of the Bankruptcy Act for a jury trial.
His Honour stated at [17] – [18]:
17 The Applicant’s initial contention -- albeit framed without the benefit of Counsel who ultimately appeared on 8 September 2008 -- that he had been wrongly deprived of a trial by jury called in aid s 80 of the Constitution. As understood, that prior submission was directed to whether a jury was required before the District Court. But it would matter not whether the submission was directed to the District Court proceedings or to the proceeding presently before this Court.
18 However the contention be expressed, it was rightly abandoned by Counsel on behalf of the Applicant on 8 September 2008. It was a contention without substance. But some brief reasons should be set forth for reaching that conclusion in order to avoid the prospect that the Applicant is left believing that an argument of substance had been wrongly abandoned.
His Honour then considered the relevant provisions of both the Bankruptcy Act and the Federal Court of Australia Act 1976 (Cth) at [26] – [27]:
26 Consistent with the abandonment of reliance upon s 80 of the Constitution as the source of any entitlement to have this Court hear the Application before it by Judge and jury, the relief as sought in the Notice of Motion as filed on 8 September 2008 sought to place reliance upon ss 30 and 31 of the Bankruptcy Act. Reference was also made to ss 39 and 40 of the Federal Court of Australia Act-- but those provisions, it was contended by the Applicant, were “qualified or not determinative of jury usage to decide factual questions in bankruptcy cases”.
27 This Court unquestionably has a discretionary power to direct that a trial be by jury. The relevant source of that power is said by the Applicant to be ss 30(3) and 31 of the Bankruptcy Act.
At [32] his Honour stated:
32 Rather than supporting the conclusion being sought by the Applicant, it is considered that the provisions of both the Federal Court of Australia Act and the Bankruptcy Act -- and the authorities which have previously considered those provisions -- strongly support the rejection of the relief sought in the present Motion in the exercise of the Court’s discretion.
At [33]:
33 The power conferred on this Court by s 40 of the 1976 Act to appoint a jury has never been exercised.
At [37]:
37 The normal method or mode of trial in this Court is by judge alone: Insurance Commissioner v Australian Associated Motor Insurers Ltd (1982) 65 FLR 172 at 182. “Substantial reason”, it has been said, must be shown for a departure from the usual mode of trial: Gargan v Commonwealth Bank of Australia [2004] FCA 641 at [6] per Hely J.
At [39]:
39 … Relevant to the exercise of the discretion is a recognition of the important role that juries have long played in English and Australian law and the circumstances in which juries have traditionally been employed.
At [41]:
41 An acceptance of the important role long played by juries provides no basis for any different exercise of the discretion conferred by s 40. The “ends of justice” in the present proceeding do not “render it expedient” to appoint a jury to determine such questions of fact as may be contained within the Applicant’s Schedule… Whatever facts may be relevant to the Application to have the Bankruptcy Notice set aside will be heard and determined by this Court; no “grievous wrong” will be suffered by the Applicant if it is a Judge alone who determines that Application.
At [42]:
42 Notwithstanding a contrary submission advanced on behalf of the Applicant, it is not considered that public confidence in the administration of justice by this Court would be impaired or called into question by a Judge of this Court sitting alone in the present proceeding to hear evidence as to the conduct of the Deputy Commissioner of Taxation or her officers and to make findings of fact based upon such evidence, always assuming such evidence is relevant.
At [53]:
53 The Bankruptcy Act, it must nevertheless be accepted, confers no entitlement to trial by jury: Hubner v Australia and New Zealand Banking Group Ltd [1999] FCA 385, 88 FCR 445.
Then at [54], Flick J referred to Re Shields; Ex parte Australia and New Zealand Banking Group Ltd (1994) 51 FCR 308 per Einfeld J who observed at 309:
...in bankruptcy proceedings jury trials will be the exception rather than the rule... A jury trial involves a great deal of expense and time both to the parties and the Court, as well as considerable inconvenience to the members of the community who constitute the jury. The use of juries in civil matters has steadily declined during this century and is now largely reserved for those areas where serious imputations are to be made against the character of a party. Like divorce, bankruptcy is no longer regarded as such a matter. In the absence of some very compelling special circumstance, the intention of Parliament is clearly that bankruptcy proceedings be heard by a judge.
… Some “special reason” must be shown for a departure from the normal mode of trial: Commonwealth Bank of Australia v Rigg [2001] FCA 590.
Justice Flick in Harding v Deputy Commissioner of Taxation then referred to s.30(3) of the Bankruptcy Act only applying when a question of fact arises. His Honour reached the following conclusion at [55]:
55 Such authority as there is in respect of s 30(3) (and other comparable provisions) provides no support for any conclusion other than that there is no entitlement to trial by jury in bankruptcy proceedings and, of more immediate importance, no support for a conclusion that trial by jury in bankruptcy cases is the norm. Even in the more confined context of bankruptcy proceedings, it has thus been accepted that “special reason” must be shown if a jury is sought.
Mr Lazarus submits that the basis on which the jury trial is sought is in respect to the interpretation of ss.36 and 37 of the Imperial Acts Application Act which state:
36 Alienation of fee simple
Land held of the Crown in fee simple may be assured in fee simple without licence and without fine and the person taking under the assurance shall hold the land of the Crown in the same manner as the land was held before the assurance took effect.
12 Charles II c 24-The Tenures Abolition Act 1660 -s 4.
37 Tenure
All tenures created by the Crown by way of the alienation of an estate in fee simple in land after the commencement of this Act shall be taken to be in free and common socage without any incident of tenure for the benefit of the Crown.
Mr Lazarus submits that the respondent does not understand how it is conceivable that either of the above provisions could have relevance to any issue arising in this proceeding as the original application was to set aside a Bankruptcy Notice. As there are constraints or limitations upon the basis upon which a Bankruptcy Notice may be set aside it is apparent how either of the above provisions could any conceivable relevance to these proceedings. Although some reference was made to there being a constitutional convention no submissions were made by Mr Kelly to the Court indicating how any constitutional issue could arise.
Submission in reply
Mr Kelly with the assistance of a McKenzie friend indicated that he wants to challenge the legality of the Land and Environment Court outcome in the Federal Court and in light of the recent High Court decision in Pape v The Commissioner of Taxation [2009] HCA 23 which considered s.15A of the Acts Interpretation Act 1901 (Cth). Mr Kelly wishes to have the Federal Court rule on the meaning of the word “socage” as used in s.37 of Imperial Acts Application Act. He states that ss.36 and 37 of the Imperial Acts Application Act are in ancient language dating from 1290 and there needs to be a definitive Australia-wide definition what those words actually mean. He submits that he understands “socage” to mean “to plough”. Mr Kelly states that as there is no modern equivalent of that term, there needs to be a determination of the modern meaning of ss.36 and 37. Mr Kelly believes that under s.39 of the Judiciary Act, he has a right to approach the Federal Court to resolve this issue.
Consideration
I acknowledge that Mr Kelly is considerably disadvantaged because he is a self-represented litigant who does not fully understand the procedures of the Court. I sympathise with this problem. However, I am not satisfied based on the material before me that there are any grounds for this matter to be transferred to the Federal Court. I believe it is in both parties’ interests to know with some certainty the future progress of this matter. Consequently I indicated during the hearing that the interim application for a transfer to the Federal Court was dismissed and that I would publish written reasons for that decision. I rely on Richmond v BMW Australia Finance Limited (No.2) (2009) 254 ALR 76 in that I am not required to deliver my reasons for decision contemporaneously with making the order.
Although Mr Kelly indicated that he wishes to raise a constitutional issue, no notices of a constitutional question have been filed under s.78B of the Judiciary Act. Nor has he raised any submissions.
I now move to s.39 of the Federal Magistrates Act which, in part, relates to whether this Court has sufficient resources to hear and determine the proceedings. I note that this Court considers applications to set aside Bankruptcy Notices on a regular basis. Federal Magistrates who sit in bankruptcy matters are able to provide hearing dates on relatively short notice. When this matter was referred to me from the Registrar’s list on 28 April 2009, counsel for both parties indicated that they would be ready to argue the matter today. Written submissions were handed to the Registrar but unfortunately these were not placed on the Court file. However it does confirm that the parties were ready to proceed on the scheduled hearing date.
Considering the relevant rules as a whole and taking into account all factors effectively counts against transfer of these proceedings, particularly in relation to convenience, time and cost. In addition a transfer to the Federal Court so that an application may be made for a jury trial under s.33 of the Bankruptcy Act is not supported by the authorities. The recent decision of Flick J in Harding v Deputy Commissioner of Taxation clearly indicates that in bankruptcy proceedings, jury trials are the exception rather than the rule.
The underlying theme in Mr Kelly’s oral submissions is that the proceedings in this Court should be transferred to the Federal Court to allow detailed examination by a jury of the provisions of ss.36 and 37 of the Imperial Acts Application Act. No submissions have been made in support of this argument. On the material before this Court it is not conceivable how any constitutional issue arises. Consequently, the interim application for a transfer to the Federal Court should be dismissed.
I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for judgment of Lloyd-Jones FM.
Associate:
Date: 24 July 2009
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