Kimber v Clark in his capacity as trustee of the property of Kimber

The appeal was brought by Kimber, the bankrupt, against Clark, in his capacity as trustee of the property of Kimber. The dispute centred around the orders made by a judge of the Federal Circuit Court of Australia in relation to the sale of real property to complete the administration of the bankrupt estate. There was also a dispute between the trustees and the major creditor concerning a proof of debt and claimed priority legal costs. The appeal was dismissed with minor amendments to the orders made by the primary judge.

The court was required to decide the legal issues concerning the orders sought by the Trustees before the primary judge and whether they went further than the ambit of the application itself. The court also needed to determine whether the Trustees were acting properly in proceeding in the manner they did, and if there was any denial of procedural fairness established in this regard.

The court found that the primary judge was correct in not acceding to Ms Kimber's course of not moulding the relief to the circumstances as they developed, including by reason of agreement being reached between the Trustee and the Owner’s Corporation. The Trustees were acting entirely properly in proceeding in this manner, and there was no denial of procedural fairness established in this regard. A right to be heard, or at least an opportunity to be heard, does not equate to a right to have a contrary view prevail. The court also found that the appeal failed on the main aspects, and the ordinary consequences of such substantial failure would be that costs follow the event. However, due to the nature of the protected money’s share of the proceeds of realising the Unit, and Ms Kimber’s status as a regulated debtor, it was best to accede to the common ground view that the question of costs on appeal and below was best dealt with on the papers.

The appeal was dismissed with minor amendments to the orders made by the primary judge. The declarations and orders made by the primary judge on 7 September 2021 were varied as follows: Declaration 2 was varied to add after “s 116(2)(g)” the words “and s 116(4)”; the chapeau of order 6 was varied by deleting the word “net”; order 6(e) was deleted; order 6(i) was varied by replacing “s 116(2)(g)” with “s 116(4)”; and order 11 was deleted. Costs in relation to the appeal were reserved until delivery of the Court’s reasons.