Kevin Michael Pullen v Matthew Joiner
[2012] FMCA 937
•26 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| KEVIN MICHAEL PULLEN v MATTHEW JOINER & ORS | [2012] FMCA 937 |
| PRACTICE AND PROCEDURE – Application for adjournment by correspondence – no appearance on day of hearing – application refused. BANKRUPTCY – Application to review decisions of trustees – applications to have trustees investigated – application for trustees employee to be investigated – application to have trustees and employee apologise to applicant and his family. |
| Bankruptcy Act 1966, ss.30(1), 155H(1)(f), 176(2)(a), 176(2)(b), 176(2)(c), 179(1) Federal Magistrates Court Rules 2001, r.16.05(2)(a) |
| Buljubasic v Buljubasic (1999) FLC 92-865 Johnson v Johnson (2000) 201 CLR 488 |
| Applicant: | KEVIN MICHAEL PULLEN |
| First Respondent: | MATTHEW JOINER |
| Second Respondent: | GERALD COLLINS |
| Third Respondent: | JAMES WILSON |
| File Number: | BRG 455 of 2011 |
| Judgment of: | Jarrett FM |
| Hearing date: | 26 July 2012 |
| Date of Last Submission: | 26 July 2012 |
| Delivered at: | Brisbane |
| Delivered on: | 26 July 2012 |
REPRESENTATION
| No appearance by the applicant |
| Solicitor for the First, Second and Third Respondents: | Mr Muller |
| Solicitors for the First, Second and Third Respondents: | Rodgers Barnes & Green |
ORDERS
The amended application filed 28 June 2012 is dismissed.
The applicant pay the respondent’s costs of the hearing on 25 August, 2011 and the costs of and incidental to the application filed on 7 June, 2011 to be taxed and paid in accordance with the Federal Magistrates Court (Bankruptcy) Rules 2006.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
BRG 455 of 2011
| KEVIN MICHAEL PULLEN |
Applicant
And
| MATTHEW JOINER A TRUSTEE OF THE PROPERTY OF KEVIN MICHAEL PULLEN A BANKRUPT |
First Respondent
| GERALD COLLINS A TRUSTEE OF THE PROPERTY OF KEVIN MICHAEL PULLEN A BANKRUPT |
Second Respondent
| JAMES WILSON A SERVANT OF THE FIRST AND SECOND RESPONDENTS |
Third Respondent
REASONS FOR JUDGMENT
Ex tempore
This application has come on for final determination today in respect of certain parts of the relief sought by the applicant in his amended application filed on 28 June, 2011. I determined some of the relief sought in that application by an order that I made on 5 June, 2012 for reasons that I delivered orally on that day. The hearing had taken place some 10 months earlier and there was a regrettable delay in delivering the judgment. The reasons were delivered orally, but the written reasons were only settled on 24 July, 2012. The applicant was notified of the delivery of judgment on 5 June by my Associate and he responded by indicating to her that he would not available to listen to the judgment delivered at 2.15 on 5 June, 2012, but he asked for a copy of the written judgment to be sent to him at an email address.
The final hearing today was fixed by my order of 5 June, 2012. The respondents all appear today by legal representative. Mr Muller, solicitor for the first, second and third respondents, has filed an affidavit by leave this morning wherein he exhibits considerable correspondence between the applicant and my Associate and my Associate and the respondent solicitors. Essentially, it is said three matters require consideration before I proceed with the hearing in this matter.
The first is whether today’s application should be adjourned. Mr Muller’s affidavit exhibits considerable correspondence between Mr Pullen and my Associate about the adjournment of today’s proceedings. The correspondence reveals that my Associate indicated to Mr Pullen that before any application for an adjournment could be considered, first of all, he needed the consent of the respondents before that correspondence could be placed before me; secondly, absent that consent, an appearance this morning was required to argue the adjournment application.
There is no formal application filed by Mr Pullen in these proceedings for an adjournment. All that there is, it seems, is correspondence sent to my Associate and which has been in one way or another sent to the respondents. I do not intend to treat that as an application for an adjournment. In doing so, I refer to a decision of the Full Court of the Family Court of Australia in Buljubasic v Buljubasic (1999) FLC 92-865. In that case, the Full Court, which consisted of Lindenmayer, Finn and Warnick JJ, refused to consider an adjournment of proceedings communicated to the Court by facsimile to the Registrar. At paragraph 29 of the judgment of Lindenmayer J, his Honour said this:
Just before I come to that, I think it is appropriate to observe that in this modern day, there seems to be a tendency for people to believe that it is an appropriate way to communicate with Courts, or this Court at least, by sending facsimile transmissions to the registrar in the belief that they will come to the attention of the trial Judge. Ordinarily speaking, that is not a proper way for any litigant to seek to communicate with the Court. Whilst it is appropriate to communicate with the registry about procedural matters in that fashion, no doubt, it is not an appropriate way for a litigant, whether represented or unrepresented, to seek to communicate with the judge who is to hear the case.
Ordinarily speaking, if a party to proceedings, whether represented or otherwise, seeks to have an indulgence from the Court in the form of an adjournment or an extension of time for doing something which has been listed to be disposed of on a particular day, the litigant has an obligation either to appear before the Court in person to seek that indulgence or to send a legal representative on his or her behalf to make a proper application to the Court for that relief. It is not, generally speaking, an appropriate way to seek an adjournment of proceedings which are listed for hearing before the Court to send a letter, whether by facsimile or otherwise, to the registry on the morning of the hearing setting forth the request for an adjournment and stating the grounds upon which the application is made.
Those remarks were echoed by Warnick and Finn JJ. Finn J said this at paragraph 49, quote:
I would also want to endorse strongly the comments that have been made by the presiding Judge regarding the importance of adherence to the traditional practice that those who seek from the Court an adjournment of their matter, should appear themselves, or by legal representative, to seek the adjournment. I deplore the apparently ever increasing practice of sending letters, faxes and telephone communications to the Court for the purpose of seeking an adjournment.
Warnick J agreed.
Times have moved on since that judgment was delivered in 1999 and now, the preferred method of communication appears to be email. But the principle remains the same and the principle, in my view, is equally applicable to this Court irrespective of the type of matter it is determining. The type of jurisdiction being exercised by the Court has no impact on the procedural requirements which have, at their core, the requirements of natural justice. Communications with the Court seeking an adjournment without notice to the other side or without the other side’s consent are inappropriate. There is a practice direction issued by the Chief Federal Magistrate in respect of communications with chambers. If a party wishes to ask for an adjournment, there is an obligation to appear and seek it. But more than that, there is an obligation to properly invoke the Court’s processes by filing an appropriate application or application in a case and supporting the claim for relief, in this case a claim for an adjournment, with appropriate evidence. There is none of that in this case. I do not propose to grant any adjournment of the proceedings on the basis of correspondence.
Second, Mr Muller’s affidavit makes it clear that there is also a claim by Mr Pullen that I disqualify myself from the further hearing of these proceedings. Again, there is no application before me in that respect and the grounds for it are entirely unclear. To the extent that it might be suggested that the delay between hearing this case and the delivery of judgment on 5 June, and thereafter, the delay in the provision of the written reasons delivered orally on 5 June, should form some basis for me to disqualify myself, I accept the submissions of Mr Muller that none of those things go to establishing the types of matters spoken of by the High Court in cases like Johnson v Johnson (2000) 201 CLR 488, which need to be established before a Court can excuse itself from discharging its constitutional functions and obligations. To the extent that there is an application for me to disqualify myself, it is refused.
Finally, it is said that perhaps these proceedings ought not continue further because there is an application for an extension of time before the Federal Court within which to appeal the decision that I gave on 5 June, 2012. The file that is presently before me does not indicate that is so. There is nothing on the Court documents in the file which I have before me which indicates that such an application has been filed. But even assuming that it has, in my view that would be no reason to adjourn today’s proceedings. To the extent, therefore, that there is any application for an adjournment before me or an application for me to disqualify myself, those applications are refused.
[Recorded – Not transcribed]
By his amended application filed on 28 June, 2011 the applicant Kevin Michael Pullen seeks a broad range of relief against the first, second and third respondents. The first and second respondents are the trustees of his estate in bankruptcy. The third respondent is a servant or employee of the first and second respondents. I have already dealt with the applicant’s claim for relief set out in paragraphs 2, 3 and 5 of his amended application, that is, his claims to access the file held by his trustees in bankruptcy. I refused his application in that regard. The balance of the application seeks a broad range of orders, but they can be distilled down to a number of more precise claims for relief. I am assisted by the written submissions delivered for the respondents.
The applicant is an undischarged bankrupt. As I have indicated, the first and second respondents are the trustees of his estate in bankruptcy and the third respondent is one of their employees. The applicant’s claims in the first instance relates to the way in which his trustees have dealt with his claims to be able to deal with a particular piece of real property, which, I apprehend from the material, is his family home. That parcel of real estate was the subject of a mortgage to Secure Funding Pty Ltd and as such, Secure had all of the rights that it was entitled to exercise as a secured creditor. Secure exercised those rights against the property by ultimately taking possession of it and causing it to be sold.
The applicant contends two matters in respect of that property: the first is that the trustees have not properly discharged their duties to him and to the creditors of his estate because the trustees refused to countenance a refinance proposal in respect of that property; and secondly, the trustees refused to permit the applicant to commence proceedings against Secure to pursue what he perceives as losses incurred by either his estate or him by reason of Secure selling that property at an undervalue.
I will deal with the first matter, that is, the claim that the trustees have in some way acted improperly or in dereliction of their duty by refusing Mr Pullen’s request to refinance the property. The evidence reveals that Mr Pullen was able to secure an offer of refinancing, see exhibit KMP6 to his affidavit filed 7 June, 2011. But that offer by reason of its terms seemed to be made on the basis that it was to pay “out bankruptcies”. That is to say, the terms of the offer seemed to suggest that the refinance was being provided to discharge Mr Pullen’s obligations to his creditors, either in full or in accordance with some arrangement that he had been able to reach with someone.
Mr Pullen sought his trustees’ consent to the refinancing, but ultimately, that was refused on the basis that his trustees thought that it was not in the interest of the creditors of the bankrupt’s estate. Mr Pullen contends that had the refinance been permitted, Mr Pullen would have remained in the home and his family would have remained in the home. The home would have remained subject to a security, but according to Mr Pullen’s evidence, he would have been able to meet the costs of that refinancing and to meet the repayments in respect of the refinanced mortgage. Essentially, and to put it in the vernacular, it would have saved his home. He contends that it would have brought no particular benefit or detriment to the estate and to his creditors generally.
There are two creditors involved in this estate as I apprehend the material, the first is Secure Funding Pty Ltd, the second is the Australian Taxation Office. The former is secured, the latter is not. And so, Mr Pullen complains that the trustees’ decision not to permit the refinancing was improper. However, I cannot on the material before me come to that conclusion. It seems to me that there was nothing improper about the trustees’ decision. Mr Pullen may well have been unhappy with it, but then it is not unusual for bankrupts to be unhappy with the decisions made by their trustees.
As to the second matter, it is correct, it seems to me, as a matter of law to say that even if it were the case that it could be demonstrated that Secure Funding had sold the property at an undervalue and therefore a cause of action lies against Secure Funding for that breach of duty, the cause of action vests in Mr Pullen’s trustees in bankruptcy. It is something which they are entitled to for the benefit of his estate. It is doubtful that the trustees can assign that cause of action to him, but even if they could at law, they have not been asked to do so in terms. Rather, Mr Pullen has sought the trustees’ consent to him commencing proceedings against Secure Funding.
The trustees cannot consent to such a course because if they were to do so, and proceedings were commenced by the bankrupt against Secure Funding, the first matter, one would presume, that would be an issue would be his title to pursue the proceedings. The answer to that difficulty might be for him to say that he has received an assignment of the cause of action from his trustees in bankruptcy, but he has not asked for that.
To the extent that it might be said that his requests for his trustees’ to consent to him commencing the proceedings is a request for an assignment of the cause of action, there is nothing before me which would suggest that the trustees’ refusal to assign the cause of action is improper or ought to attract any relief from this Court. The evidence relied upon by Mr Pullen are some appraisals obtained by him from real estate agents which suggest that the property has been sold for a sum less than what those appraisals suggested at which it could be marketed. But appraisals by real estate agents and a price inserted in an incomplete contract of sale is not evidence of value and absent any evidence of value, one cannot conclude at all that there is a cause of action against Secure.
To the extent then that in paragraph 1 of his amended application, Mr Pullen seeks an order that the decision of the first respondent dated 8 April, 2011 with respect to “denying permission for the applicant to commence proceedings against Secure Funding Pty Ltd for breaches of the Property Law Act1974, the Land Title Act 1974, the National Credit Code, the Privacy Act1988 and the Criminal Code Act1995, with regard to loan account number 1093005 with Secure, secured by mortgage number 708357805 over the land described within title reference 18376181 as Lot 345 on RP844430, county of Canning, parish of Bribie, situated at 53 Gattera Road, Landsborough and the subsequent sale of that property by Secure” be reversed, that application is dismissed.
Mr Pullen seeks consequential relief that the Court direct that he be permitted to commence proceedings against Secure for the breaches to which I have just referred. For the reasons I have already delivered, however, that application, too, is dismissed.
The next claim made by Mr Pullen is that the Court direct that he be permitted to pursue an objection to a particular taxation assessment made in respect of him directly with the Australian Taxation Office and if necessary, to commence proceedings against the Australian Taxation Office for any breaches of any Commonwealth or State statute or common law that may be subsequently discovered following the investigation. The material reveals that on 11 April, 2007 the Deputy Commissioner of Taxation lodged a proof of debt for $245,861.73. The applicant subsequently lodged his tax returns for the financial years ended 30 June, 2001 to 2006. The Commissioner subsequently lodged an amended proof of debt with the trustees on 24 October, 2008 for $222,729.76.
Despite the proof of debt being lodged in October, 2008 the first and second respondents have not yet adjudicated on the Commissioner’s proof. The applicant disputes the debt owed to the Commissioner, but it is difficult to see in his material any evidence upon which he would dispute the debt. I accept the proposition that the evidence does not reveal that he has provided to the first and second respondents any evidence which supports his assertion that he does not owe a debt to the Commissioner of Taxation. It is clear from the material that Mr Pullen wishes to lodge an objection to the assessment made by the Australian Taxation Office and he has indicated that if his objection is not accepted, he will commence proceedings against the Commissioner.
The solicitor for the respondents points out that Division 1, Part VI of the Bankruptcy Act1966 sets out the procedure for adjudicating upon proofs of debt. After the first and second respondents have adjudicated upon the Commissioner’s proof of debt, Mr Pullen, if he is not satisfied with their adjudication, may apply to the Court for a review of it. That point, however, has not yet been reached. I accept the submission that a bankrupt does not have standing to lodge an objection directly with the Australian Taxation Office in respect of a provable debt claimed by the Commissioner for Taxation, nor does he have the ability to commence proceedings against the Commissioner in respect of a proof of debt lodged by the Commissioner. That must be a correct proposition, otherwise this application would not be before me. In my view, no case has been made out to support the claim for relief in paragraph 6 of the amended application and that claim too is dismissed.
Mr Pullen claims a raft of relief against the first and second respondents pursuant to s.179(1) of the Bankruptcy Act1966. Section 179(1) provides that:
The Court may, on the application of the registrar, the Inspector-General, a credit 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 other order as it thinks proper.
Mr Pullen applies under that section for an order that the first respondent be removed from office, that the second respondent be removed from office, and that alternatively to those orders, the Inspector-General of Bankruptcy be directed to initiate involuntary termination of the registration of the first and second respondents due to their breaches of s.155H(1)(f) of the Bankruptcy Act1966. He also seeks orders in the alternative that the first and second respondents be removed from duties in connection with his bankrupt estate.
He seeks an order that the Inspector-General of Bankruptcy be directed to institute disciplinary proceedings against the first and second respondents in view of their inappropriate actions in connection with his bankrupt estate. He seeks an order that the Inspector-General of Bankruptcy be directed by the Court to apply to the Court to seek orders that might be made under ss.176(2)(a), (b) and (c) of the Bankruptcy Act1966.
He seeks an order that the Court direct that the first and second defendants jointly and severally make good “the loss” to the bankrupt estate and the loss that the applicant has sustained because of the first and second respondents’ breach of duty. He seeks against the first, second and third respondents an order that they attend the premises of the applicant to be advised on a date and time mutually convenient to the applicant and the first, second and third respondents and to present their individual verbal apologies to the applicant, his spouse and their daughter for the actions which resulted in the loss of an amenity, namely, their house.
I do not propose to grant any relief under s.179(1) of the Bankruptcy Act1966. I am not satisfied on the material that the first and second respondents are to be removed from office, nor am I satisfied that there are grounds to direct the Inspector-General of Bankruptcy to initiate involuntary termination of registration of the first or second respondents. I am not satisfied that they have breached their duties to the bankrupt estate or the creditors of the estate, nor, in my view, have they fallen foul of s.155H(1)(f) of the Bankruptcy Act1966.
What the material does disclose is that Mr Pullen, who, on any view of the material has considerably antipathy towards his trustees, is very dissatisfied with their decisions about the way in which his house was dealt with and the way in which they are dealing with the Australian Taxation Office. He may well be dissatisfied about those matters, but there is nothing demonstrated in the material in my view which would invoke the Court’s jurisdiction under s.179(1) or s.30(1) for that matter.
As against the third respondent, that is, the employee of the first and second respondents, Mr Pullen claims that he be barred from acting in any further matters under the Bankruptcy Act1966. I do not think I have the power to make that order, even under s.30(1) of the Bankruptcy Act1966, but even if I am wrong, I would not do that. There is no basis on the material to do it.
Alternatively, Mr Pullen seeks an order that the third respondent be removed from duties in connection with his bankrupt estate. Again, I am not sure that I have power to do that, even under s.30(1) of the Act. Even if I did, I would not do it based on the evidence before me.
What the evidence reveals is that the third respondent has acted under the supervision of the first respondent and he has been responsible, it seems from the material, for the day to day activities associated with the conduct of this bankrupt estate. The decisions made by the trustees are not the third respondent’s decisions, although he has been responsible for carrying out some of the work to implement them. In my view, there is no basis demonstrated in the material for the orders sought by Mr Pullen against the third respondent.
Similarly, I am not satisfied that I ought to make an order that the Inspector-General of Bankruptcy be directed to institute disciplinary proceedings against the third respondent. There is no basis, in my view, for an order that the third respondent make good any loss which Mr Pullen alleges he has sustained because I am not satisfied that he has sustained any loss by reason of any breach of duty by the third respondent.
Although I have considered the merits of the application, the application ought to be dismissed in my view on the basis that Mr Pullen has failed to appear and has failed to prosecute his application. I would also dismiss his application on its merits.
These orders have been made in Mr Pullen’s absence. He has an entitlement under rule 16.05(2)(a) of the Federal Magistrates’ Courts Rules to apply to have them set aside.
I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of Jarrett FM
Date: 22 October 2012
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