Pitman v Johnson (Trustee)

Case [2017] FCA 1382


FEDERAL COURT OF AUSTRALIA

Pitman v Johnson (Trustee) [2017] FCA 1382

Appeal from: Application for an extension of time: Pitman v Johnson [2017] FCA 945
File number: SAD 245 of 2017
Judge: WHITE J
Date of judgment: 14 November 2017
Catchwords: PRACTICE AND PROCEDURE – application for an extension of time within which to commence an appeal – Applicants sought to appeal decision of a Judge of the Federal Court of Australia – period of extension short – prejudice to the Respondents – Applicants have not shown a proper case for grant of an extension – application refused
Legislation:

Bankruptcy Act 1966 (Cth) s 130(2)

Evidence Act 1995 (Cth) s 9(3)(b)

Federal Court Rules 2011 (Cth) rr 1.39, 36.03, 36.05

Stamp Duties Act 1923 (SA) s 22

Date of hearing: 14 November 2017
Registry: South Australia
Division: General Division
National Practice Area: Commercial and Corporations
Sub-area: General and Personal Insolvency
Category: Catchwords
Number of paragraphs: 28
Counsel for the Applicants: Mr NL Strawbridge
Solicitor for the Applicants: Cleveland Chambers
Counsel for the Respondent: Mr M Douglas with Mr K Ryder
Solicitor for the Respondent: O’Loughlins Lawyers
Table of Corrections
29 November 2017 In the second sentence of paragraph 27, the word “not” is inserted between the words “do” and “permit”.

ORDERS

SAD 245 of 2017
BETWEEN:

PHILIP JOHN PITMAN

First Applicant

DEAN CLIFT

Second Applicant

DOROTHEA TOMAZOS

Third Applicant

AND:

GREGG ROBERTSON JOHNSON AS TRUSTEE FOR THE BANKRUPT ESTATE OF SOTIRIOS PORTELLOS

Respondent

JUDGE:

WHITE J

DATE OF ORDER:

14 NOVEMBER 2017

THE COURT ORDERS THAT:

1.The application for an extension of time is refused.

2.The Applicants are to pay the Respondent’s costs of and incidental to the application for the extension of time.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


EX TEMPORE REASONS FOR JUDGMENT

WHITE J:

  1. On 17 August 2017, a Judge of this Court dismissed the application of the Applicants for declaratory and other relief in respect of a large quantity of rough opalised sandstone (the Rough Opal).  The Judge found that contrary to the Applicants’ claim, a trust of which they are the trustees (the Andamooka Opal Stone Unit Trust) was not the owner of the Rough Opal: Pitman v Johnson [2017] FCA 945.

  2. The Applicants did not commence an appeal against the dismissal of their application within the 21 day period fixed by r 36.03 of the Federal Court Rules 2011 (Cth) (the FCR) for that purpose. The 21 day period expired on 7 September 2017.

  3. However, by an application filed on 18 September 2017, the Applicants seek an extension of time in which to commence an appeal. The Respondent opposes the grant of the extension. The Court does have power to extend the time. The power is implicit in r 36.05 of the FCR and, in any event, is made express by r 1.39.

  4. The discretion to extend time is to be exercised judicially.  Prominent among the considerations to which the Court will…

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AGLC
Pitman v Johnson (Trustee) [2017] FCA 1382
Case
[2017] FCA 1382
Decision Date

CaseChat Overview and Summary

In Pitman v Johnson (Trustee), the applicants sought an extension of time within which to commence an appeal against a decision of a Judge of the Federal Court of Australia. The application was made to the Federal Circuit Court of Australia. The applicants contended that they had a proper case for an extension of time and that their delay in lodging the appeal application was not attributable to any want of diligence on their part.

The court had to decide whether the applicants had shown a proper case for the grant of an extension of time within which to commence an appeal and whether the respondents would be prejudiced if the extension was granted. The court noted that the period of extension sought was relatively short, but that the explanation provided for the delay was not complete or satisfactory. The respondents asserted that they would be prejudiced if the extension was granted, particularly because the longer the period before the administration of the bankrupt estate could be completed, the greater would be the depletion of the estate funds resulting from the expenditure of funds for the storage of the Rough Opal. The court accepted that there was relevant prejudice to the respondents and that the applicants had not made any proposal concerning the payment of these additional costs which would be incurred by the respondents as a result of their delay.

The court refused the application for an extension of time. The court noted that had the appeal been lodged within time on 7 September 2017, there was a good prospect that it would have been heard by the Full Court in the present month, November. However, as things stood now, if an extension of time was granted, the appeal was unlikely to be heard before February next year. The court considered that the applicants had not shown a proper case for the grant of an extension of time within which to commence an appeal and that the respondents would be prejudiced if the extension was granted.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The affidavit of Mr Pitman does not add to the evidentiary picture as, in substance, he deposes to very same matters as does the solicitor. Consideration Against that background, I turn to the matters bearing upon the exercise of the discretion. The period of extension sought is relatively short and, that being so, it would not be uncommon for the Court to grant an extension, providing that there is a proper explanation for the delay and it being satisfied either that a respondent will not be prejudiced or that steps can be taken to redress any prejudice. For the reasons I have already set out, I consider it difficult to regard the explanation provided by the Applicants for the delay as being complete or satisfactory. As I have sought to indicate, in several respects that explanation begs for further particulars and leaves unstated a number of matters which are material to an application of the present kind. The Respondent does assert that he will be prejudiced if the extension of time is granted. First, he refers to the kind of prejudice associated with a delay in winding up the bankrupt estate if the extension is granted. By itself, that may not have been significant in the present case, given the shortness of the extension sought. However, the Respondent is presently paying costs of $966 per month for the storage of the Rough Opal. The longer the period before the administration of the bankrupt estate can be completed, the greater will be the depletion of the estate funds resulting from this expenditure. To my mind, this is a material consideration. Had the appeal been lodged within time on 7 September 2017, there is a good prospect that it would have been heard by the Full Court in the present month, November. However, as things stand now, if an extension of time was granted, the appeal is unlikely to be heard before February next year. That being so I accept that there is relevant prejudice to the Respondent. It is pertinent to take into account that the Applicants have not made any proposal concerning the payment of these additional costs which would be incurred by the Respondent as a result of their delay. The solicitor for the Respondent has deposed that he did not become aware of the existence of the application for the extension of time until on or about 25 October 2017, despite the application having been filed in this Court on 18 September 2017. However, I do not understand the Respondent to be asserting any additional prejudice arising from that circumstance and so do not, for present purpose, attach significance to it. The Respondent also refers to the depletion of funds in the bankrupt estate which is likely to result from the expenditure of funds for legal representation in defending the appeal. However, the Respondent has also filed an application for an order that the Applicants provide security for costs in the event that an extension of time is granted. That being so, it may well be that the Respondent will not suffer prejudice in connection with the incurring of legal costs and so I put that consideration to one side also.