Legge v Mackinlays Solicitors (No 2)
[2008] FCA 513
•10 April 2008
FEDERAL COURT OF AUSTRALIA
Legge v Mackinlays Solicitors (No 2) [2008] FCA 513
PRACTICE AND PROCEDURE – whether person should be permitted to become a party to an appeal after orders made in the appeal
Federal Court Rules O 52 r 14(2)
Legge v Mackinlays Solicitors [2008] FCA 345
GEOFFREY SPENCER LEGGE v MACKINLAYS SOLICITORS
WAD 60 OF 2007
SIOPIS J
10 APRIL 2008
PERTH
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
WAD 60 OF 2007
ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA
BETWEEN:
GEOFFREY SPENCER LEGGE
AppellantAND:
MACKINLAYS SOLICITORS
Respondent
JUDGE:
SIOPIS J
DATE OF ORDER:
10 APRIL 2008
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.The time for Mr Simonsen to file and serve a Notice of Motion, referred to in the order made on 20 March 2008, is extended to 4.00 pm on 3 April 2008.
2.The Motion is dismissed.
3.Mr Simonsen is to pay the Official Trustee in Bankruptcy’s costs in respect of the hearing today and on 3 April 2008.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
WAD 60 OF 2007
ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA
BETWEEN:
GEOFFREY SPENCER LEGGE
AppellantAND:
MACKINLAYS SOLICITORS
Respondent
JUDGE:
SIOPIS J
DATE:
10 APRIL 2008
PLACE:
PERTH
REASONS FOR JUDGMENT
This is a notice of motion which is brought by Mr Mark Simonsen to set aside orders of the Court that were made by consent on 10 March 2008 allowing an appeal against the decision of the Federal Magistrates Court and ordering that the bankruptcy of Mr Legge be annulled.
It is necessary to set out some of the circumstances to explain the background of this application.
Mr Legge was made bankrupt on 22 March 2004 on a petition which was brought by Mackinlays, a firm of solicitors. The petition was founded upon a default judgment of the Perth Local Court which Mackinlays obtained against Mr Legge in respect of unpaid legal fees.
Mr Legge applied to the Federal Magistrates Court to annul the bankruptcy and on 2 March 2007 the Federal Magistrate dismissed Mr Legge’s application to annul his bankruptcy. Parties to that application were Mackinlays, Mr Legge, and it also appears from the appeal book that the Official Trustee appeared before the Federal Magistrates Court with leave.
Mr Legge then appealed against the decision of the Federal Magistrates Court. In the meanwhile, and before the appeal was heard, Mr Legge succeeded in obtaining an order from the Western Australian Magistrates Court setting aside the default judgment which had been obtained by Mackinlays.
I heard the appeal on 10 March 2008. The parties that appeared at that appeal were Mr Legge and Mackinlays. The Official Trustee appeared by leave. The appeal concluded by the Court approving consent orders which allowed the appeal and ordered the annulment of Mr Legge’s bankruptcy. I gave reasons for approving the consent orders (Legge v Mackinlays Solicitors [2008] FCA 345). The day after the consent orders were made and before they were extracted, Mr Simonsen wrote to the Court by email saying that he was not happy with the orders, that he was a creditor of Mr Legge and that he had not been given notice of the annulment application made by Mr Legge in the Federal Magistrates Court in 2006.
I directed that the District Registry not extract the orders and I listed the matter for mention on 20 March 2008. The District Registrar asked the Official Trustee to notify all of the creditors of the mention hearing. The Official Trustee did that. The Official Trustee also sent a copy of my reasons to each of the creditors. The only person who appeared at the hearing on 20 March 2008, other than the parties to the appeal and the Official Trustee, was Mr Simonsen. At the hearing I advised Mr Simonsen that if he wished to make any application, he should file and serve a notice of motion and an affidavit in support of that application, by 4 pm on 27 March 2008, failing which the orders made on 10 March 2008 would be extracted.
On 27 March 2008, Mr Simonsen filed a notice of motion and an affidavit. However, Mr Simonsen did not serve the notice of motion and the affidavit before the expiry of the time limit. This was because he was not given a listing date by the Registry until 28 March 2008 and also because he posted the notice of motion and affidavit to each of the two parties and the Official Trustee. I am prepared to extend the time for the service of the notice of motion and the affidavit until 4 pm on 3 April 2008.
In his affidavit filed in support of the motion, Mr Simonsen said that he was a former business partner of Mr Legge and that the business partnership had terminated and the accounts were not yet settled. However, he claims that Mr Legge owes him money arising from the partnership including a partnership debt which he settled with somebody else. The Official Trustee has admitted a proof of debt in respect of Mr Simonsen, only to the extent of $100, but Mr Simonsen has deposed that he is in dispute in the Federal Magistrates Court with the Official Trustee in respect of claims arising from the partnership with Mr Legge.
Mr Simonsen went on to depose that he had not been served with the notification by Mr Legge of the Federal Magistrates Court proceeding to annul his bankruptcy. However, in para 11 and para 12 of his affidavit of 27 March 2008, Mr Simonsen deposed in the following terms:
Based on discussions with Ms Heljo Cameron of ITSA, I became aware of the appellants [sic] (“Legge”) application to annul his bankruptcy, but at that time I was not aware of the requirement that the appellant (“Legge”) was required to serve me and other creditors with certain papers. I did not become aware of this requirement until after the appeal was underway.
It was sometime later when I was speaking with Ms Heljo Cameron of ITSA, that she made me aware of the subsequent appeal and that it was at this time I was informed by her that the appellant (“Legge”) was aware of the requirements to serve creditors. I told her that I had not been served with anything.
The first question is the standing of Mr Simonsen to make this application.
Mr Simonsen was not a party to the annulment proceeding before the Federal Magistrates Court and he is not a party to the appeal before this Court. However, the Court has power to make a person a party to an appeal even if the person was not a party to the proceeding below. The power is to be found in O 52 r 14(2) of the Federal Court Rules. The question is whether I should exercise the power to permit Mr Simonsen to become a party to the appeal. I will not exercise the power to do so, for the following reasons.
The complaint that Mr Simonsen makes is that he was not served with notice of the annulment application before the Federal Magistrates Court.
Mr Legge has given evidence that Mr Simonsen was given the notice but I will proceed on the assumption, without so finding, that Mr Simonsen was not served with the notice of the proceeding. The evidence shows that Mr Simonsen learned from the conversation that he had with Ms Cameron from the office of the Official Trustee, that Mr Legge had made an application for the annulment of his bankruptcy to the Federal Magistrates Court and had been unsuccessful in that application. The evidence is also that Ms Cameron, told Mr Simonsen that he should have been served with notice of the application. Further and significantly, Mr Simonsen also knew from those discussions with Ms Cameron that Mr Legge had appealed against the decision of the Federal Magistrates Court and that the appeal was on foot.
However, notwithstanding those facts, Mr Simonsen made no effort to become a party to the appeal. Instead, Mr Simonsen awaited the outcome of the hearing of the appeal and then for the first time, raised with the Court, albeit informally, his complaint about not having been notified of Mr Legge’s annulment application to the Federal Magistrates Court.
In my view, it is now too late for Mr Simonsen to apply to become a party to the appeal. It was open to him to take that action before the hearing of the appeal but he did not do so. It would undermine the principle of finality in litigation if, after the outcome of the appeal, I were to permit a person to become a party to an appeal, in respect of a complaint of which he had knowledge prior to the hearing of the appeal. In these circumstances, I do not exercise the power to permit Mr Simonsen to become a party to the appeal. I, therefore, dismiss the motion.
I also note that Mr Simonsen attached to his affidavit a costs agreement. However, it was not a costs agreement between Mackinlays and Mr Legge in respect of the charges made by Mackinlays which were the subject of the default judgment. This is apparent from para 11 of the affidavit of Mr Alistair Mackinlay which was sworn on 4 October 2006. I say this without prejudice to any arguments which Mackinlays may wish to make in the Western Australian Magistrates Court in respect of any proceedings they may take against Mr Legge, but on the evidence that is before this Court, that is the position.
I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis. Associate:
Dated: 16 April 2008
Counsel for the Appellant: The Appellant appeared in person. Counsel for the Respondent: Mr P Hassett (with leave) Solicitor for the Respondent: Fiocco’s Lawyers Counsel for the Official Trustee: Mr RGS Harrison Solicitor for the Official Trustee: Tottle Partners Mr M Simonsen appeared in person.
Date of Hearing: 10 April 2008 Date of Judgment: 10 April 2008