Maher v Official Trustee in Bankruptcy
[2014] FCA 113
•19 February 2014
FEDERAL COURT OF AUSTRALIA
Maher v Official Trustee in Bankruptcy [2014] FCA 113
Citation: Maher v Official Trustee in Bankruptcy [2014] FCA 113 Appeal from: Application for leave to appeal: Maher v Official Trustee in Bankruptcy [2013] FCA 1143 Parties: DENNIS MAHER v THE OFFICIAL TRUSTEE IN BANKRUPTCY and COMMONWEALTH BANK OF AUSTRALIA ABN 48 123 123 124 File number: VID 1223 of 2013 Judge: MURPHY J Date of judgment: 19 February 2014 Catchwords: PRACTICE AND PROCEDURE – application for leave to appeal against decision to order security for costs – applicant impecunious – whether leave to appeal should be granted Legislation: Federal Court of Australia Act 1976 (Cth) – s 37M(1) Cases cited: Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
Bright v Femcare Ltdand Anor (2002) 195 ALR 574
Caraher v Gillespie (1906) 23 WN (NSW) 161
Commonwealth Bank of Australia & Ors v Maher [2008] FMCA 1280
Co-Operative Farmers’ and Graziers’ Direct Meat Supply Ltd v Smart [1977] VR 386
Décor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397
DJE Constructions Pty Ltd v Maddocks (1981) 38 ALR 185
House v The King (1936) 55 CLR 499
Lines v Tana Pty Ltd [1987] VR 641
Lucas v Yorke and Anor (1983) 50 ALR 228
Lynnebry Pty Ltd v Farquhar Enterprises Pty Ltd (1977) 3 ACLR 133
Maher v Commonwealth Bank of Australia [2007] FMCA 400
Maher v Official Trustee in Bankruptcy [2013] FCA 1143
Pearson v Naydler [1977] 3 All ER 531
Tradestock Pty Ltd v TNT (Management) Pty Ltd (1977) 14 ALR 52
Transport Workers Union v Leon Laideely Pty Ltd (1980) 28 ALR 589Date of hearing: 18 February 2014 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 35 Counsel for the Applicant: The Applicant appeared in person Counsel for the First Respondent The First Respondent did not appear Counsel for the Second Respondent: Mr J W S Peters SC and Mr R D Shepherd Solicitor for the Second Respondent: Turks Legal
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 1223 of 2013
BETWEEN: DENNIS MAHER
ApplicantAND: THE OFFICIAL TRUSTEE IN BANKRUPTCY
First RespondentCOMMONWEALTH BANK OF AUSTRALIA ABN 48 123 123 124
Second Respondent
JUDGE:
MURPHY J
DATE OF ORDER:
18 FEBRUARY 2014
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.The application for leave to appeal be dismissed.
2.The Applicant pay the Second Respondent’s costs.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 1223 of 2013
BETWEEN: DENNIS MAHER
ApplicantAND: THE OFFICIAL TRUSTEE IN BANKRUPTCY
First RespondentCOMMONWEALTH BANK OF AUSTRALIA ABN 48 123 123 124
Second Respondent
JUDGE:
MURPHY J
DATE:
19 FEBRUARY 2014
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
In this proceeding the applicant, Dennis Maher, seeks leave to appeal from orders that he provide security for costs to the second respondent, the Commonwealth Bank of Australia (“CBA”) (Maher v Official Trustee in Bankruptcy [2013] FCA 1143) (“the primary judgment”). The first respondent, the Official Trustee in Bankruptcy, has played no active role in the proceeding.
THE APPLICATION FOR ADJOURNMENT
Mr Maher seeks to adjourn his application for leave to appeal, doing so against the following factual background.
The application for leave to appeal was filed on 21 November 2013, supported by Mr Maher’s affidavit made on that date. The matter was listed for hearing before me on 10 December 2013.
In his affidavit Mr Maher sought an adjournment of 30 days to seek another solicitor to act in the appeal as he said his present solicitor was unable to continue. I granted the application for adjournment and on 28 November 2013 I re-fixed the matter for hearing on 18 February 2014.
On 4 February 2014 Mr Maher wrote to chambers advising that due to the Christmas and holiday period he was having trouble in obtaining a solicitor to represent him in the hearing. He stated, however:
Fortunately I have just been able to obtain a firm to act. However they require time to read the papers to form an opinion.
He sought an adjournment of a further 30 days.
Mr Maher did not advise the CBA of his communication with chambers. Upon the CBA being provided with a copy of his letter it filed submissions opposing adjournment. Amongst other things, the CBA submitted that:
(a)the applicant had had sufficient time from 21 November 2013 to engage a lawyer;
(b)the applicant alleged that he had engaged a firm of lawyers but had not named them, and no new lawyer had filed a notice of acting;
(c)the Court should not be confident that the stated reason for the adjournment, that the new lawyers require time to read the papers, was true;
(d)if the new lawyers did require time to read the papers then they had had sufficient time to do so;
(e)the applicant did not offer to pay the costs of the CBA thrown away by reason of the adjournment, and it would incur real prejudice because it had briefed senior and junior counsel to appear;
(f)in any event the applicant was well able to argue his case, having represented himself in many applications before this and other courts; and
(g)the application for leave to appeal is weak.
On 12 February 2014 I refused the application for an adjournment.
On 14 February 2014, Mr Maher again wrote to chambers seeking an adjournment. In this letter, contrary to his letter of 4 February 2014, he said that he had been unable to obtain a solicitor because of the Christmas and New Year period. Mr Maher then applied for the adjournment at the commencement of the hearing. He did not copy his letter to the CBA and it had no notice of his application.
He first argued that the initial adjournment of the hearing from 10 December 2013 was not made on his application. However, when taken to his affidavit he accepted that he had sought that adjournment.
Secondly, Mr Maher said that he had approached several solicitors, although he put on no sworn evidence as to these approaches. I am not satisfied that if he diligently pursued the matter it would have taken from 21 November 2013 to 18 February 2014 to obtain a solicitor.
Thirdly, Mr Maher said that when he informed the Court on 4 February 2014 that he had obtained a solicitor and that the solicitor needed time to consider the papers, he instead meant that he had a solicitor looking at the file. He put on no sworn evidence to this effect. He accepted that his letter of 4 February 2014 was incorrect in this regard.
He sought to argue that his lack of ability in the English language or his lack of legal qualification lay behind his wrongly informing the Court. I do not accept this. He is articulate and suffers no apparent lack of ability in the English language. The question as to whether he had or had not obtained a solicitor required no legal qualifications. In my view his communication with chambers was misleading.
Fourthly, in support of a contention that there was no prejudice to the CBA in a short further delay, Mr Maher contended that there had been significant earlier delays in the substantive proceeding, and that these delays were not through any fault of his. Contrary to this submission, the file shows that on four occasions his solicitors requested or caused adjournments of the substantive proceeding. Not all of the delay in this matter may be laid at the feet of Mr Maher, but it is plain that his contention is incorrect.
Finally, while Mr Maher accepted that the CBA would suffer a financial loss through an adjournment, he argued that there was no need to engage Senior Counsel, and sought that the costs of junior counsel be fixed at only $400. I do not accept his approach. He gave no notice to the CBA that he intended to again apply for an adjournment, and they were entitled to brief senior and junior counsel to appear.
In the primary judgment at [7]-[15] the primary judge set out the long history of proceedings by Mr Maher in this and other Courts. The proceedings largely revolve around Mr Maher’s failure, or refusal, to pay costs that were first ordered in February 2004, and his resultant bankruptcy. Numerous further costs orders had been made since 2004, and it appears that Mr Maher has not met any of those orders. I have no confidence that the CBA will recover its costs if I order an adjournment with costs. The primary judge noted at [5] “it seems clear beyond argument that the applicant, if unsuccessful in this proceeding would be unable to pay the CBA’s costs.”
The application for leave to appeal was for Mr Maher to prosecute. He was granted one adjournment of more than two months, and then on 4 February 2014 did little more than reiterate his application. The grounds he put forward were not true. When he reiterated the application at the commencement of the hearing he provided no evidence in support of his claim that he had approached several solicitors. In my view the application had little substance.
It is relevant too that the application for leave to appeal is weak. This fortifies my conclusion that the adjournment should be refused.
Section 37M(1) of Federal Court of Australia Act 1976 (Cth) (“FCA”) requires the Court to manage the just resolution of disputes taking account of, amongst other things, the efficient use of the judicial resources available, the efficient disposal of the Court’s overall caseload, and the disposal of all proceedings in a timely manner. In my view each of these considerations militate against granting an adjournment. The approach for which Mr Maher contends amounts to an inefficient use of judicial resources, reduces the ability of the Court to officially dispose of its caseload, and does not allow the disposal of the application for leave to appeal in a timely manner.
While Mr Maher has a right to bring these proceedings he has a corresponding duty to prosecute them diligently. An order for costs (on the assumption that Mr Maher actually met the order, which I doubt) does not necessarily justify an adjournment. The Court and the community share a legitimate interest in the effective resolution of disputes which may transcend the interests of the parties themselves: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at 182[5] per French CJ and at 217[111]-[112] per Gummow, Hayne, Crennan, Kiefel and Bell JJ.
I refused the application for an adjournment.
THE APPLICATION UNDER RULE 4.11 AND 4.12
For the first time, at the commencement of the hearing Mr Maher sought referral for pro bono assistance under rr 4.11 and 4.12 of the Federal Court Rules 2011. He did not explain why he had not taken this step before. He has a long history of involvement in litigation before this and other Courts, and for much of that period he was an undischarged bankrupt. I have little doubt that he understood the availability of a referral for pro bono assistance well prior to the commencement of the hearing.
In my view, Mr Maher sought to use his late application for pro bono assistance as a basis for adjournment. He submitted that if I granted the referral then it would follow that an adjournment must be granted. I do not accept this contention. Mr Maher had ample time to make an application for pro bono assistance, and he did not do so. I did not determine Mr Maher’s application for pro bono assistance, but in my view his case lacks the merit that might justify a referral to the pro bono scheme.
LEAVE TO APPEAL
The grounds of the application for leave to appeal are general and wanting in particularity. The application alleges only that:
(a)the orders were manifestly incorrect;
(b)it is a matter of public interest that the Court consider how a sequestration order can be made by “fictitious entities” (as Mr Maher describes them); and
(c)the primary judge acted upon wrong principles (although how this was so was not specified).
Mr Maher filed short submissions contending that his impecuniosity was not a sufficient ground for the order requiring security for costs. He relied on Co-Operative Farmers’ and Graziers’ Direct Meat Supply Ltd v Smart [1977] VR 386; Lines v Tana Pty Ltd [1987] VR 641; Pearson v Naydler [1977] 3 All ER 531 at 533; Caraher v Gillespie (1906) 23 WN (NSW) 161. He also submitted that his claim was made bona fide, had reasonable prospects of success, and the application for security was being used oppressively to frustrate his claim. In this regard he relied on Lynnebry Pty Ltd v Farquhar Enterprises Pty Ltd (1977) 3 ACLR 133; Tradestock Pty Ltd v TNT (Management) Pty Ltd (1977) 14 ALR 52 at 275. He handed up excerpts from the judgment of Brennan J in Lucas v Yorke and Anor (1983) 50 ALR 228, and the judgment of Gibbs CJ in DJE Constructions Pty Ltd v Maddocks (1981) 38 ALR 185.
I do not accept that Mr Maher’s claim has reasonable prospects of success as he contends. I respectfully concur with the views of the primary judge (at [17]) that the first two grounds of Mr Maher’s claim “are likely to encounter serious, if not insuperable, difficulties”. I also respectfully agree with the primary judge (at [25]) that it would be hard for Mr Maher to resist an argument that he is estopped from again advancing his argument that the CBA was not authorised by Mr Firth and Gray & Johnson. The prospects of success are an important factor in a security for costs application, and in my view Mr Maher’s claim is more likely to fail than not.
I also respectfully concur with the view of the primary judge (at [22]) that the third ground of Mr Maher’s claim does not indicate any potential injustice will be suffered by him if he is unsuccessful.
Notwithstanding that he had already filed short written submissions the application took a surprisingly turn when I called on Mr Maher to argue the merits of his application for leave. Mr Maher declined to make any oral submissions. He argued that it would be unjust and unfair to require him to put forward his argument when he was neither legally qualified nor legally represented.
In effect, he was again asking for an adjournment, but this was his application for leave to appeal and it was his obligation to obtain legal representation. He had been granted a two month adjournment for just that purpose.
Further, while Mr Maher is not legally qualified I was not satisfied that he was unable to advance oral submissions when:
(a)he prepared and filed short written submissions which illustrate a grasp of the issues and corresponding legal authorities; and
(b)he has a long history of representing himself in litigation. Without seeking to set out every occasion upon which he has appeared unrepresented, he appeared before Phipps FM in the sequestration application: Commonwealth Bank of Australia & Ors v Maher [2008] FMCA 1280. He also appeared before O’Dwyer FM in an application to set aside the bankruptcy notice in Maher v Commonwealth Bank of Australia [2007] FMCA 400. In this latter case, his Honour noted at [6] that Mr Maher “presented as a skilled advocate for one not trained in the law; obviously an intelligent man who was well researched.”
I reminded Mr Maher that it was his application for leave to appeal, and informed him that unless he made some submissions I would have little option but to dismiss the application. Mr Maher then said that he was not sure that he understood what I meant by this, but I have no doubt that he did understand. He declined to make any oral submissions.
Mr Maher’s task to persuade the Court that leave to appeal should be granted was always going to be a difficult one. The decision being appealed involved the exercise of a discretion by the primary judge. An appellate court will not interfere with that decision unless an error of the kind referred to in House v The King (1936) 55 CLR 499 (“House v King”) at 504-505 is shown to have been made in the exercise of discretion, or unless the Court is persuaded that the decision stands outside the limits of the discretion: Transport Workers Union v Leon Laideely Pty Ltd (1980) 28 ALR 589 at 593. In the Full Court it would be necessary for Mr Maher to show that the primary judge acted upon a wrong principle, allowed extraneous or irrelevant matters to guide or affect him or her, mistook the facts or did not take into account some material consideration.
Where, as here, the decision to be appealed from concerns practice and procedure leave to appeal must only be granted if the decision results in a substantial injustice to one of the parties: Décor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 (“Décor Corp”) at 399-400 per Sheppard, Burchett and Heerey JJ; Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170 (“Adam P Brown”) at 177 per Gibbs CJ, Aickin, Wilson and Brennan JJ. This is because a “tight rein” must be kept upon appellate interference with exercises of jurisdiction on matters of practice and procedure: Adam P Brown at 177; Bright v Femcare Ltdand Anor (2002) 195 ALR 574 (“Bright”) at 575[2] per Lindgren J.
In other words, an appellate court will usually only be justified in granting leave to appeal from an interlocutory decision concerning the exercise of discretion in the context of practice and procedure if:
(a)there is sufficient doubt as to whether the primary judge’s decision was infected by one or more of the vitiating factors described in House v King; and
(b)substantial injustice would result if, the decision being supposed to be wrong, leave to appeal were refused: Décor Corp at 399-400; Bright at [5].
While I did not have the benefit of oral argument by Mr Maher, I have considered his written submissions and I have reviewed the detailed and careful reasons of the primary judge. I can discern no error of the kind referred to in House v King, and I am not satisfied that sufficient doubt attends his Honour’s decision. Nor do I consider that any substantial injustice results if, the decision being supposed to be wrong, leave to appeal is refused.
For these reasons I have refused leave to appeal, and have ordered that Mr Maher pay the CBA’s costs of the application.
I certify that the preceding thirty-five (35) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy. Associate:
Dated: 19 February 2014
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