Rahman v Dubs
[2019] FCCA 3899
•24 September 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| RAHMAN v DUBS & ORS | [2019] FCCA 3899 |
| Catchwords: CONSTITUTIONAL LAW – Constitutional power to enact Bankruptcy Act 1966 (Cth) – Constitution s.51(xvii) – plenary power in relation to bankruptcy – power in relation to bringing matters from State Courts to Federal Courts – fundamental misunderstanding of the law – Application dismissed. |
| Legislation: Bankruptcy Act1966 (Cth), ss.153B, 58(1)(a) |
| Cases cited: Boles v Official Trustee in Bankruptcy [2001] FCA 639; (2001) 183 ALR 239 |
| Applicant: | MOHAMMAD TABIBAR RAHMAN |
| First Respondent: | ROSALIND V DUBS |
| Second Respondent: | AUSTRALIAN FINANCIAL SECURITY AUTHORITY |
| Third Respondent: | DAVID JOHN FRANK LOMBE |
| File Number: | SYG 3339 of 2018 |
| Judgment of: | Judge Baird |
| Hearing date: | 24 September 2019 |
| Date of Last Submission: | 24 September 2019 |
| Delivered at: | Sydney |
| Delivered on: | 24 September 2019 |
REPRESENTATION
| Solicitors for the Applicant: | Mr M T Rahman in person |
| Counsel for the Third Respondent: | Mr A Spencer |
| Solicitors for the Respondent: | DWF (Australia) |
| Solicitors for the Third Party Creditors: | Mr D Wong, Makinson d’Apice Lawyers |
ORDERS
The application by the applicant, Mr Rahman, that I recuse myself from hearing this matter be refused.
The interim application filed by Mr Rahman filed on 19 July 2019 be dismissed.
The Application filed 30 November 2018 be dismissed.
The Trustee’s costs of and incidental to this Application are to be paid out of the Bankrupt’s estate in accordance with s.109 of the Bankruptcy Act 1966 (Cth).
Grants leave to the first respondent, second respondent, and the supporting creditors Mr P Riordan and Mr D McGrath, by 1 October 2019, to apply to the Court if they wish to be heard in relation to costs, any such costs application to be accompanied by an outline of submissions on costs, limited in each case to 2 pages.
Orders that in the event that any of the persons identified in the preceding order make such costs application, they serve the documents on all other parties, and in the case of Mr Rahman, by express post to the address on the Application.
Orders by 4pm on 9 October 2019 Mr Rahman file and serve any outline of submissions in answer on costs, limited to 2 pages, and only to be filed and served if any person has applied to the Court pursuant to paragraph 5 of this order.
Orders any such costs application be heard and determined on the papers.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
No. SYG 3339 of 2018
| MOHAMMAD TABIBAR RAHMAN |
Applicant
And
| ROSALIND V DUBS |
First Respondent
| AUSTRALIAN FINANCIAL SECURITY AUTHORITY |
Second Respondent
| DAVID JOHN FRANK LOMBE |
Third Respondent
REASONS FOR JUDGMENT
(ex tempore, revised from transcript)
In this proceeding Mr Rahman, a bankrupt, seeks an order, under s.153B of the Bankruptcy Act1966 (Cth), annulling his bankruptcy. He filed the Application seeking this order on 30 November 2018, which was processed by the Court on 3 December 2018. Mr Rahman relies in support of his Application on an affidavit affirmed by him on 30 November 2018 comprising in the body of the affidavit some six pages, and supported by following pages of documents comprising, in all, some 195 pages.
Mr Rahman supplements that affidavit and documents with a document filed in the Court on 25 February 2019 headed “SUBMISSIONS - AS PER DIRECTIONS”, comprising one page of three paragraphs of submissions, and a list of some 19 other items described as “NAME AND SYNOPSIS OF EVIDENCE - THE EXHIBITS”, which listing and items together totalling 85 pages. I will refer to both such documents as the “affidavit and supporting documents”. Additionally, Mr Rahman relies on a document headed “Submission: Notice of a Constitutional matter under s.78B of the Judiciary Act 1903” which, with supporting documents, was filed in the Court on 18 March 2019.
On 19 July 2019, Mr Rahman filed an application in a case comprising three paragraphs, and supported by a document headed “AFFIDAVIT” sworn on the same day, 19 July 2019. That document and supporting papers comprises some 15 pages identified by its heading as the affidavit, and a list of items headed “NAME AND SYNOPSIS OF EXHIBITS”, in all totalling 36 pages. That application in a case sought orders that I disqualify, exclude and remove myself, that the Chief Justice allocate a new judge to the matter, and thirdly, sought summary judgment, referring to s.17AA(b) and s.31A of the Federal Circuit Court of Australia Act 1999 (Cth), arguing that the other party has no reasonable prospect of successfully defending the proceeding or part of the proceeding, and stating: The Respondents are of default absentees.
Mr Rahman has brought this application against three named Respondents: Ms Rosalind V Dubs, the “Official Receiver”, and thirdly, David John Frank Lombe. Mr Lombe is Mr Rahman’s trustee in bankruptcy, or to put it more correctly, the trustee of the bankrupt estate of Mohammad Tabibar Rahman. Mr Lombe relies on an affidavit sworn by him on 13 March 2019 and a supporting exhibit which I have received into evidence. Ms Dubs, and the Second Respondent, the Official Receiver, have filed submitting notices, although each has indicated they wish to be heard on the question of costs.
Additional documents include Mr Rahman’s filing on 5 September 2019 “a notice to creditors of annulment application” which listed the three Respondents and eight other persons, in total 11creditors. The creditors Peter Riordan and David McGrath have filed a notice of appearance, and their solicitor, Mr Wong, who is also named as a creditor, has appeared today on their behalf. Mr Wong informed the Court that he and his clients relied on the evidence and submissions of Mr Spencer of counsel, made on behalf of the Trustee, Mr Lombe, and had nothing to add. At lunchtime today I excused Mr Wong from further appearance on behalf of his clients.
It is relevant, briefly, to set out a short chronology of the appearances in this Court. The matter was docketed to me, and on the first return date on 8 February 2019, Mr Rahman appeared, and Ms Beange, junior counsel, appeared for Mr Lombe. I made certain orders concerning Mr Rahman’s filing of any further evidence, that is, that Mr Rahman serve the first and second respondents, or otherwise file and serve an affidavit of his attempts to effect such service, and I directed Mr Lombe to file and serve evidence and an outline chronology. I then listed the matter for further directions on 22 March 2019.
Mr Rahman has appeared in person on 8 February 2019, on 22 March 2019 and before me today. On 22 March 2019, I noted that the first and second respondents had each filed a submitting notice, and Ms Beange appeared again for Mr Lombe. I listed the matter for final hearing, initially, on 8 August 2019 with an estimate of a day. I later vacated that date and relisted the matter for hearing today. On 22 March 2019, I relieved Mr Rahman from the obligation to give notice to creditors under r.7.03 of the Federal Circuit Court (Bankruptcy) Rules 2016 (Cth), but as I have already said, Mr Rahman has chosen to give notice to creditors, and has filed such a notice.
Whilst I directed both Mr Rahman and Mr Lombe to provide written submissions, and that each party file a one page statement of issues well before the hearing, neither party did so. I have also made orders for the limiting of time for oral argument, but whilst I have made those orders, I note that today I allowed the parties further time to make submissions, whilst seeking to keep the parties to the matters before the Court today.
On the last occasion the matter was before me, 22 March 2019, unlike today, Mr Rahman appeared very excitedly. After some time, I took the view that it was appropriate to call the Court’s security in an attempt to have Mr Rahman accede to the directions I gave him to sit down and be quiet. It is that behaviour, both on Mr Rahman’s part, and on my part, calling for the assistance of security, that is the subject of Mr Rahman’s interlocutory application.
As I have said, at the hearing today Mr Rahman appeared on his own account, and Mr Lombe was represented by Mr Spencer of counsel, instructed by Ms Kirsten Farmer, of instructing solicitors DWF Australia. I should say that Mr Spencer has only come into the matter very late, and has provided such assistance to the Court as he was able to do so given the very short time in which he has, as I apprehend, been briefed in the matter. Mr Spencer explained that Mr Golledge of counsel held the brief in the matter, and that he was a Chambers colleague of Mr Golledge. Mr Spencer also informed me that Ms Beange was a junior barrister who had appeared on the previous occasions.
I requested, and the parties complied with, first hearing the matter in relation to the application in the case, and then proceeding to hear the substantive application. I heard from Mr Rahman and from Mr Spencer, and reference was made to various of the documents before the Court.
I formed the view during this hearing, and I indicated, that I would dismiss the application in the case, and that I would, with the giving of these reasons, also give my reasons for so doing. I will do so briefly at the end of these reasons. I then proceeded to hear the applications. The hearing proceeded in a combination of references to evidence and the making of submissions, first, by Mr Rahman, and then by Mr Spencer, and then briefly by Mr Rahman in reply.
Factual background and history of relevant proceedings
Mr Rahman’s proceedings in this Court, in the Federal Court, in the Supreme Court, and in the High Court have occupied a significant number of judges and decisions over more than seven years. The history of the events leading to Mr Rahman’s bankruptcy have been given in a number of those decisions, and it is perhaps otiose to repeat them today save in this summary way.
In November 2009, Mr Rahman commenced proceedings against Ms Dubs in the Supreme Court of New South Wales. McCallum J in the Supreme Court heard three notices of motion in that proceeding on 18 December 2009. Relevant to the present case, on that day, McCallum J ordered that Ms Dubs be removed as a party, and that the University of Technology Sydney (UTS) be joined as a defendant. Her Honour at [14] stated that the order sought by Ms Dubs that she be removed and that UTS be joined was “plainly an appropriate order”. She referred to remarks made by Gummow J in Smith Kline & French Laboratories (Aust) Ltd v Secretary, Dept of Community Services and Health (1990) 22 FCR 73, where his Honour noted at [75] that the respondent in that proceeding, as first framed, should not have been sued in his own name but rather by the office he held. That order led to an order for costs. At [21] of McCallum J’s reasons, she ordered Mr Rahman to pay Ms Dubs costs of the day, being 18 December 2009.
Mr Rahman then appealed to the New South Wales Court of Appeal, and on 28 May 2010, the New South Wales Court of Appeal in Rahman v Dubs (2010) NSWCA 129, upheld McCallum J’s decision. At [6] and [7], the Court of Appeal stated:
[6]The other error relied upon in submissions concerned the removal from the proceedings of Ms Dubbs, and the substitution of the University of Technology Sydney. The situation is that Ms Dubbs was the Registrar at the time certain decisions were made, but she is no longer the Registrar. The view taken by the primary judge was that the University was an appropriate party, and that any other party should be the office bearer for the time being of the relevant office named as such office bearer.
[7]Mr Rahman’s submissions give me no cause to think that the primary judge was wrong. Consistently with her decision, it will be open to Mr Rahman to seek to add as parties the relevant office bearers under their title as office bearers. In my opinion, there is no possible injustice to Mr Rahman in that course.
As I understand, Mr Rahman subsequently proceeded against other parties, including Mr Hartigan and another person.
Chronologically, the next relevant event is that Ms Dubs, as a creditor, sought the issue of a bankruptcy notice. The amount claimed as per the attached final judgments or final orders was the sum of $56,298.46. The judgment orders were attached. Mr Rahman has taken me to them in the course of today.
The judgment orders attached to the bankruptcy notice came about as a result of costs assessments of the costs the subject of various costs orders made in a number of court proceedings. These, and the costs assessment process is described in the decision on the hearing of the creditor’s petition before Raphael FM in the Federal Magistrates Court of Australia (as the Court was then named), on 19 July 2012, and the making of the sequestration order. In Dubs v Rahman (2012) FMCA 664 Raphael FM described the costs assessment process at [14] as follows:
[14]Finally, Mr Rahman raises what might be considered to be his only reasonable argument. He has made application to seek leave to appeal against the orders which founded the Bankruptcy Notice. In order to clarify the position, I would say that the judgments which founded the Bankruptcy Notice are judgments that came about as a result of the costs assessment process. This process is codified in the Legal Profession Act 2004 (NSW). Essentially, it allows for costs of proceedings to be assessed by a person known as a costs assessor. It allows for a party, against whom a costs order has been made, to make representations to the costs assessor about the costs that the successful party claims. If a party is not satisfied with a costs assessor’s assessment, he can seek review, and if he is not satisfied with the result of the review, he can appeal to the Supreme Court on a point of law. As I understand it, this is what Mr Rahman has done initially in respect of only two of the judgments but, as Mr Rose concedes, possibly now in respect of all four of them.
I note that before Raphael FM, in an argument that, in part, was also made before me today, Mr Rahman argued that because Ms Dubs was no longer the Registrar of UTS, she was not a party to the proceeding, see at [16]:
[16]It also concerns me that what I have learnt from Mr Rahman about the nature of his appeal seems to traverse much of the type of argument that he has made to me today. He believes he can find assistance in his cause from the fact that Ms Dubs is no longer the registrar of the University of Technology. He seems to believe that he can find assistance in the fact of the change of name of the solicitors. He has not indicated to me anything from which I could discern that he has a reasonably arguable case and, for that reason, I am not prepared to grant him the adjournment, even though the matter is to be heard tomorrow.
Following Raphael FM’s judgment, the bankruptcy notice dated 13 March 2012 was issued against Mr Rahman, with Ms Dubs as the petitioning creditor, and the sequestration order against Mr Rahman was made by Raphael FM on 19 July 2012. By paragraph 3, the sequestration order was made against the estate of Mr Rahman, and the Court noted for the purpose of the sequestration order that the date of bankruptcy was 10 April 2012. The other relevant document is the creditor’s petition dated 26 April 2012 filed on behalf of Ms Dubs in relation to Mr Rahman.
In the hearing before Raphael FM a number of arguments were made by Mr Rahman which have been repeated before me today. I will come to those shortly.
As a consequence of the sequestration order made on 19 July 2012, by reason of s.58(1)(a) of the Act, the property of the bankrupt not being after acquired property vests forthwith in the Official Trustee or, if at the time when the debtor becomes a bankrupt, the Registered Trustee becomes the trustee of the bankrupt by virtue of s.156A of the Act, in that Registered Trustee.
In the present case, at the date of the sequestration order, it appears there was no consent to act as trustee by a registered trustee, and the petitioning creditor had not nominated any such trustee. Accordingly, by the operation of s.58 of the Act, the property of the bankrupt, that is the property of Mr Rahman, became vested in the Official Trustee.
In evidence before me is a certificate of appointment of trustee appointing “the official trustee in bankruptcy with effect from 19 July 2012”. That certificate is dated 16 August 2012. As Mr Spencer has submitted, and I accept, what happened in the present case is that pursuant to s.181A of the Act, Mr Lombe was nominated as the new trustee of the estate of Mr Rahman, and, in due course, namely by appointment on 19 October 2012, Mr Lombe was appointed the trustee of the estate of Mr Rahman, the bankrupt. I note that Mr Lombe’s evidence is that he is an official liquidator of the Supreme Court of New South Wales and the Federal Court of Australia, and a registered trustee in bankruptcy.
I have in evidence before me certificate of appointment of trustee dated 19 October 2012, evidencing the appointment of Mr Lombe as trustee of the bankrupt, Mr Rahman. I note that the certificate is a certificate issued under the letterhead of the Australian Government Insolvency & Trustee Service Australia signed by the Official Receiver. It states the following:
The information on this certificate has been extracted from the National Personal Insolvency Index and is certified as correct as at the date of issue. Pursuant to bankruptcy regulation 13.07, this document can be used as evidence in any proceeding without further proof.
I note, in passing, that a statement to the same effect appeared on the certificate of appointment of the official trustee to which I have already referred.
Mr Lombe, pursuant to his obligations as trustee, and as one of his duties, then appears to have sought to bring into the estate such of the assets of the bankrupt as relevant to the administration of the estate. Mr Rahman drew my attention today to a document headed “International Money Transfer” dated 21 November 2012 which was a Commonwealth Bank document identifying an amount of AU$57,303, effecting transfer from the sender, Mr Rahman, of his current address, to the beneficiary “David JF Lombe ATF MT Rahman Australia” at the beneficiary bank, St George Bank. Mr Rahman has also put in evidence a Commonwealth Bank transaction details statement which shows a withdrawal of that amount on 21 November 2012.
Mr Lombe has put in evidence a Trustee’s Summary of Receipts and Payments for Mohammad Tabibar Rahman (bankrupt estate), such summary being to 13 March 2019. It shows the cash at bank of the same amount as was transferred from the “International Money Transfer” of $57,303. I am satisfied, on this evidence, that pursuant to his duties as trustee, Mr Lombe, in his position as trustee, brought under his control the amount of $57,303.
Mr Rahman filed a notice of appeal from the sequestration order to the Federal Court of Australia. Those proceedings were heard and dismissed by his Honour Justice Flick on 5 October 2012 in Rahman v Dubs (No. 2) [2012] FCA 1081. Mr Rahman then sought special leave to the High Court of Australia. On 13 March 2013 two Justices of the High Court, Kiefel J, as she then was, and Gageler J, dismissed that application. The High Court provided a succinct summary of Mr Rahman’s proceedings to date in paragraphs [1] – [3] of that judgment, which I set out below:
[1]The applicant was a student at the University of Technology, Sydney. In 2009, he was notified by the Registrar of the university, the respondent, that he was being investigated for "non-academic misconduct" and he was subsequently excluded from communicating with other students in his course for a period of seven days. The applicant commenced proceedings against the respondent in the Supreme Court of New South Wales which made a number of costs orders against the applicant. The applicant failed to pay the costs and a bankruptcy notice was served on him on 17 March 2012. On 5 May 2012, after he failed to comply with the bankruptcy notice, he was served with a creditor's petition.
[2]On 19 July 2012, a sequestration order was made against the applicant's estate by the Federal Magistrates Court of Australia (Raphael FM). His Honour refused the applicant's request for an adjournment of the hearing of the petition, pending the hearing of his application for leave to appeal the orders for costs, for the reason that the applicant's case was not arguable. His Honour held that there was no "sufficient cause" preventing the making of the sequestration order. The Supreme Court subsequently dismissed the application for leave.
[3]On 5 October 2012, the Federal Court of Australia (Flick J) dismissed an appeal from the sequestration order. His Honour reviewed the reasons of Raphael FM, because the applicant's grounds of appeal were difficult to comprehend, but found no appealable error in them. His Honour held that Raphael FM was under no duty not to proceed because the applicant had given a notice under s 78B of the Judiciary Act 1903 (Cth), since the notice failed to identify any constitutional matter. The applicant's assertion that it was not competent for the Commonwealth Parliament to enact the Bankruptcy Act 1966 (Cth) or make provision for bankruptcy notices and sequestration orders lacked foundation. Claims of fraud and criminal acts did not advance the applicant's appeal and were, in any event, without merit.
I mention two other proceedings in which issues that have been canvassed today between the parties before me today have been heard and determined. In 2017, a judge of this Court, Barnes J, heard and delivered judgment in the matter of Lombe (Trustee) In The Matter of Rahman (Bankrupt) [2017] FCCA 750 delivered on 20 April 2017. The application before her Honour was an application similar to that before me - that she recuse herself from hearing the matter, and secondly, an application made by Mr Lombe pursuant to s.146 of the Act to distribute a dividend to certain creditors. Her Honour refused the application to recuse herself, dismissed that interim application, and ordered that a dividend be distributed.
Mr Rahman then sought leave to appeal Barnes J’s judgment. Gleeson J in the Federal Court of Australia heard that application for leave, and delivered judgment in Rahman v Lombe [2018] FCA 457, on 5 April 2018. Her Honour decided that Mr Rahman was not entitled to leave to appeal, and dismissed the appeal.
A perusal of each of the judgments to which I have referred reveals, as Mr Rahman conceded today, that the submissions he has made before me have been rehearsed in the previous cases. Those matters have, in short compass, been described by Mr Rahman in this proceeding as the issue with the creditors and the creditors’ petition, secondly, a constitutional issue, and, thirdly, the matter of the original sequestration order and the incurring of the debt.
The Constitutional issue
I turn, first, to the so called constitutional issue. Mr Rahman has encapsulated his lengthy submissions on the constitutional matter as being that s.51(xxxvii) of the Constitution does not give power to anyone to bring proceedings from a State Court to the Federal Court, whether for bankruptcy, or indeed, for anything. He submits that the various judges and courts who have considered his submissions are each wrong. Mr Rahman refers to three decisions of the High Court in support of his Application: first, the decision of Le Mesurier v Connor [1929] HCA 41; (1929) 42 CLR 481, secondly, the decision of the High Court in Re Wakim; Ex Parte McNally [1999] HCA 27; (1999) 198 CLR 511, and, thirdly, the decision of Re Davison [1997] HCA 42; (1997) 147 ALR 259. As Mr Spencer submitted, each of these decisions are concerned with the limits of Commonwealth jurisdiction in relation to State matters.
In my opinion, as is simply said by Flick J in Rahman v Dubs (No 2), at [11] to [14]:
[11] Given the apparent concern of Mr Rahman with what he describes as “Constitutional questions”, it is prudent to note that the Bankruptcy Act 1966 (Cth) is an exercise of the legislative power conferred upon the Parliament by s 51(xvii) of the Constitution. That is a plenary power: R v Federal Court of Bankruptcy; Ex parte Lowenstein (1938) 59 CLR 556 at 574-575 per Starke J. “No limitation upon the power is found in the Constitution and unless such a limitation can be found there, then it does not exist …”: Stuart-Robertson v Lloyd (1932) 47 CLR 482 at 490 per Starke J. When considering the validity of a provision of the Bankruptcy Act 1924 (Cth) requiring a bankrupt to keep books of account (s 209(g)), Starke J in Ex parte Lowenstein concluded (at 574-575):
The Constitution confers upon the Parliament plenary powers to make laws for the peace, order and good government of the Commonwealth with respect to bankruptcy and insolvency (sec. 51 (xvii.)). The object of sec. 209 (g) is to compel a person who carries on business to keep such books of account as are usual and proper in the business so that the court and his creditors in case of bankruptcy may ascertain what his transactions have been, and what has become of his assets, and to force upon him the contemplation of his position and deprive him of the excuse that he was not aware of it. Such a provision in various forms has long been found in laws relating to bankruptcy and, in my opinion, is clearly a law with respect to bankruptcy. It is for the legislature and not for this court to say what provisions are necessary to achieve the objects sought and for what period of time books of account should be kept.
…
The power of the Parliament with respect to bankruptcy is, as I have said, plenary. It has power in respect of that subject matter to declare what acts shall constitute acts of bankruptcy, to divest the bankrupt of his assets, to provide for the administration thereof and distribution amongst creditors; it may create offences in relation to the subject matter and attach sanctions to those offences; it may also create courts with jurisdiction in bankruptcy matters and prescribe the procedure and powers of those courts. …
See also: (1938) 59 CLR at 571-572 per Latham CJ.
[12] In the present proceeding an Official Receiver has issued a bankruptcy notice pursuant to s 41 of the Bankruptcy Act 1966. And the power of the Federal Magistrate whose decision is now the subject of this appeal was the power conferred by s 52 to make a sequestration order. “Sequestration and distribution” of a bankrupt’s estate have long been regarded as steps in the bankruptcy process: The Queen v Davison (1954) 90 CLR 353 at 375-378 per Fullagar J.
[13] Nor should any argument founded upon any perceived inconsistency with a law of a State be accepted given the “supremacy” of the Commonwealth law: In re Richard Foreman & Sons Pty Ltd v Federal Commissioner of Taxation (1947) 74 CLR 508 at 529. Dixon J there observed:
A federal system is necessarily a dual system. In a dual political system you do not expect to find either government legislating for the other. But supremacy, where it exists, belongs to the Commonwealth, not to the States. The affirmative grant of legislative power to the Parliament over the subjects of bankruptcy and insolvency may authorize the enactment of laws excluding or reducing the priority of the Crown in right of the States in bankruptcy …
[14] No question arises as to the constitutional competence of the Commonwealth Parliament to enact the Bankruptcy Act or to make provision for the issue of a bankruptcy notice or the making a sequestration order.
Mr Rahman’s judgment debts were debts of a particular size, and the evidence of those debts has been proved by the judgment of the Supreme Court of New South Wales. That evidence of debt became the prerequisite for the issue of the creditor’s petition, and it is that creditor’s petition that then led to the making of the sequestration order to which I have already referred. I reiterate, there is no transfer of a State Court proceeding to the Federal Court: see the decision of Flick J and of the High Court in refusing Mr Rahman special leave to which I have already referred.
It is appropriate here to set out paragraphs 1, 1A, 1B, and 1C of Mr Rahman’s submission headed, “Notice of a Constitutional matter under s78B of the Judiciary Act 1903”, filed 18 March 2019 (without alteration, including original emphasis):
1.By violation , miscarriage and commissions of crimes under Constitution s77(iii), both States and Federal Legislations the Legal Professionals of Solicitor(s) and Counsel(s)' taking 'Proceedings including Rosalind V Dubs'1 –R1 SYG 922/2012 , Applicant and Respondent [First] in the above proceedings against Applicant [First] that entered in the Federal Registry on 26 April 2012 for' Sequestrations orders.' The SYG 922/2012 entered in the FMCA was from the States Courts Affairs, of State Polity that Commenced for relief in the Federal Jurisdictions' of 'FMCA of Australia. This violations of practices by the Federal Courts are from since 1977- to present times .This wrong Practices by Federal Magistrates Court Australia are since 2000-2013, and Federal Circuit Court of Australia since 2013-present time. Such practices are gross violation and miscarriage of justice. All Federal Court justices including Hon(s) Allsop ,CJ, & J, Black CJ,& J, Flick J, Emmett J, Gleeson J, Jackobson J, French J, Kiefel J, Nettle J, and all others , French CJ, Kiefel CJ, Gageler J IAA, Elderman J , Kenneth J , Nettle J , Hayne J, HCA all knowing that it is 'wronged, erred , constitutional violations but for class favour as violations upholding decisions of - their brothers and sister justices of FMCA / FCCA wrong decisions as of judicial integrity and solidarity of their social interests .
1A.The Applicant Rosalind V Dubs 2 Proceeding SYG 922/2012 entered in the FMCA on 26 April 2012. She does not have legal standing - having no lawful "Locus standis' as Creditor, as individual false claims [ Not Banks or any Financial Institutes under Banking Act (Cth) ] for Sequestrations orders. Such nature of Claims Bankruptcy Proceedings which are of continuous Practise as 'jus cogens' to make 'such Sequestrations orders' as made by Raphael K, FM on 19 July 2012 .
Similarly, under the same path like Applicant's Proceedings that were entered from 'State Courts to Federal Courts' for 'Sequestrations -Bankruptcy Orders by the Magistrates, and Justices of the Ch -111 Federal Judicatures and making 'Sequestrations 'orders from State Jurisdictions as mentioned above in other proceedings by the :-
A.Justice (s) Flick J, Nicholus J , Rares J , Yates J, Jacobson J, Gleeson J , ALLSOP J & CJ, French J & C.J ,HCA KIEFEL J, & CJ ,HCA, Nettle J and all other Justices of FCA [ Since 1977-present] ,
B.*Raphael FM,, Barnes FM,**Michael Smith,FM, Jarrett,FM. Burchardt, FM, Street, Riethmuller ,Manosarids FM and all Federal Magistrates , FMCA [2000-2013] ;AND
C.* Raphael J, *Barnes J, Manousardis J, Justice FCCA [2013-present], as of Constitutional violations and acts of constitutional treasons as tyrant for favour of the Solicitor(s) ,Counsel who share the relationships as friends former colleague, worked under the same Building -viz. 12 Wentworth Selborne Chamber
1B.The 'State Courts' which are of State Polity's of another Government. They are created by State Law having only State Jurisdictions as Courts , under States Constitution and under Constitution (Cth) Chapter V --The States s s106 Saving of Constitutions, s107 Saving of Power of State Parliaments,108 Saving of State Laws,s118, Recognition of Laws etc. of States & , s17 Jurisdiction of Courts Federal Courts (State Jurisdiction) Act 1999 (NSW), S12A Jurisdictions not conferred on Federal Courts ,Federal Courts (State Jurisdiction) Act 1999 (WA),express the sovereignty of States Courts Power . And voids and nullity of all Claims by KKIEFEL J 7 GAGELER J in S314 /2012 [2012] HCASL 23 ON 13 March 2013 , cited by GLEESON J, Rahman v Lombe [2018] FCA 457, * at Para 10D. Judgment at Para 5 .are void.
1C.That law determines the Constitution of the Court itself, and the organisations through the powers and jurisdictions are expressed. But morally bankrupt and corrupt Solicitor (s), Counsel brings and brought such proceedings in the FMCA for 'Sequestrations orders against the Applicant and others aggrieved victims both in FCA & FMCA. These Solicitor(s) Counsel(s) who share the 'relationships with the Justices and Magistrates of FCA , FCCA , FMCA & HCA [appointed by Regimes without transparency -but known faces] as friends , former colleague and worked under the same roof for the Solicitor(s) ,Counsel who share as friends former colleagues, worked under the same roof.
The paragraphs of the judgments to which I have already referred sufficiently answer Mr Rahman’s argument. As his Honour Justice Flick stated (Rahman v Dubs (No 2) at [12] to [14], refer above), and as the High Court said when refusing special leave (at [3]):
… Mr Rahman’s assertion that it was not competent for the Commonwealth Parliament to enact the Bankruptcy Act 1966 or to make provision for bankruptcy notices and sequestration orders lacked foundation. Claims of fraud and criminal acts did not advance Mr Rahman’s appeal and were in any event without merit.
The observations of the High Court have equal force in respect of Mr Rahman’s submissions today. Contrary to Mr Rahman’s submission, there is no issue of the transfer of any proceeding or matter from a State Court to the Federal Court in this matter. For completeness, the purported notice of constitutional matter does not give rise to a constitutional matter, and thus, whether or not the various Attorneys‑General were notified, the notice is not effective.
Mr Rahman also makes submissions that the personal costs order Ms Dubs obtained is invalid because there was no order made by the Supreme Court in her name as she had left UTS on 30 September 2009, and was not, at the time of the proceeding Mr Rahman brought, the Registrar of UTS.
Mr Rahman submits it follows as she was removed from the proceeding as a wrongful party, she should not have been entitled to any costs. He points to Ms Dubs’ affidavit verifying the creditor’s petition in which she gave her solicitors’ address and described herself as a “non‑executive director”. Mr Rahman points to s.69 of the Supreme Court Act1970 (NSW), and s.52 of the Administrative Decisions (Judicial Review) Act 1977 (Cth).
This, however, is to misstate the effect of the motion brought by Ms Dubs, and McCallum J’s decision. As McCallum J said, Mr Rahman initiated proceedings against Ms Dubs, and Ms Dubs sought removal from the proceeding as a person who should not have been joined. McCallum J acceded to that request, and as I have indicated, the New South Wales Court of Appeal dismissed Mr Rahman’s application.
It is not to the point that Ms Dubs was no longer the Registrar of UTS when the proceeding was either initiated or determined. The point is that Ms Dubs’ wrongful joinder, and the orders that were made at her request for removal of herself as a party led to an order for costs, and that it was the consequences of non-payment of those costs orders that have resulted in the bankruptcy, as I have already outlined.
The next argument that Mr Rahman makes goes to the question of the making of the sequestration order, and it is appropriate now to turn to the statutory basis on which Mr Rahman brings this proceeding.
Relevant legal principles
I set out the terms of s.153B of the Act (noting that the provision has been set out in Mr Spencer’s outline of submissions at [18]). Section153B is relevantly in the following terms:
153BAnnulment by Court
(1)If the Court is satisfied that a sequestration order ought not to have been made or, in the case of a debtor’s petition, that the petition ought not to have been presented or ought not to have been accepted by the Official Receiver, the Court may make an order annulling the bankruptcy.
(2)In the case of a debtor’s petition, the order may be made whether or not the bankrupt was insolvent when the petition was presented.
(3)The trustee must, before the end of the period of 2 days beginning on the day the trustee becomes aware of the order, give to the Official Receiver a written certificate setting out the former bankrupt’s name and bankruptcy number and the date of the annulment.
Penalty: 5 penalty units.
Note: See also section 277B (about infringement notices).
(4)Subsection (3) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
It is well settled that the power conferred on the Court by s.153B(1) is discretionary in nature. Even if the Court is persuaded that the sequestration order ought not to have been made, the Court may, in appropriate circumstances, decline to annul the bankruptcy, see Boles v Official Trustee in Bankruptcy [2001] FCA 639; (2001) 183 ALR 239.
Section 153B, provides for a two stage process:
(a)first, to determine whether the sequestration order should have been made at the time it was made.
(b)secondly, if that determination is made, then the Court needs to be satisfied whether, in its discretion, the sequestration order should be annulled.
The onus is upon the bankrupt, in the present case, Mr Rahman, to satisfy the Court that the power for annulment should be exercised: see by way of example, Hacker v Weston [2015] FCA 363 at [18], and Shaw v Yarranova Pty Limited [2016] FCA 88 at [6]. As Judge Barnes said recently in the Jaafar v Gleeson In his CAPACITY as Bankruptcy Trustee of the Bankrupt Estate of Mohamad Jaafar & Anor [2019] FCCA 1226, s.153B imposes a heavy burden on an applicant seeking to rely on it.
In an oft cited passage in Bulic v Commonwealth Bank of Australia Limited [2007] FCA 307 at [12], Tracey J summarised the principles applicable to the exercise of the power under s.153B(1). In Francis v Eggleston Mitchell Lawyers Pty Limited [2014] FCAFC 18 at [16]), the Full Court of the Federal Court approved that summary as follows (citations omitted):
[16]Tracey J helpfully summarised a number of principles relevant to the exercise of the discretionary power conferred by s 153B in Bulic v Commonwealth Bank of Australia Limited at [12] including the following:
Section 153B(1) and its predecessors have been considered in many decisions of this and other courts. These authorities establish a number of relevant propositions. They are:
…
(2)An applicant who seeks an annulment of his or her bankruptcy “carries a heavy burden”. It is incumbent on an applicant “to place before the Court all relevant material with respect to his or her financial affairs so that the Court may be properly informed and may make a judgment that is based on the actual circumstances of the applicant”: Re Papps; Ex parte Tapp.
(3)In determining whether or not a sequestration order “ought not to have been made” the Court is not confined to a consideration of whether the order should have been made on the facts known to the Court at the time at which it was made. The Court must take account of facts, known at the time at which the sequestration order was made and at which it determines an annulment application, even if those facts were not before the Court at the time at which the sequestration order was made.
(4)A sequestration order “ought not to have been made” if, on the facts known at the time of the annulment application, the Court would have been bound not to make the sequestration order.
…
(6)If the Court is so satisfied, it is not precluded from annulling the bankruptcy because the bankrupt had not sought to have the default judgment set aside or failed to oppose the creditor’s petition or failed to seek a review of the sequestration order.
(7)The power conferred on the Court by s 153B(1) is discretionary in nature. Even if persuaded that the sequestration order ought not to have been made, the Court can, in appropriate circumstances, decline to annul the bankruptcy.
(8)Considerations which may have a bearing on the exercise of discretion include unexplained delay in the making of the application, whether or not the applicant is solvent, whether or not the applicant has made full disclosure of his or her financial affairs and a failure by the bankrupt to oppose the creditor’s petition and attend the hearing at which the sequestration order was made.
As Mr Spencer submits, other matters relevant to the exercise of the Court’s discretion include the conduct of the bankrupt (see Ozer v Australian Liquor Marketers Pty Limited [2001] FCA 1197 at [29]‑[34]), and whether the annulment is for the benefit of creditors and “will be conducive or detrimental to commercial morality and to the interests of the public” (referring to Re Lawson (1939) 11 ABC 137 at [139]).
The Applicant’s grounds for annulment, submissions and consideration
Mr Rahman in essence raises four points as grounds for annulment:
(a)first, that he was solvent;
(b)secondly, that he did not owe any money to anyone, including not to the petitioning creditor, Ms Dubs;
(c)thirdly, that the bankruptcy notice was a miscarriage and error;
(d)fourthly, that the judgment on the petition was a miscarriage and error.
As Mr Rahman colourfully put it to me:
Who appointed Mr Lombe? Who made the certificate of appointment of trustee? It’s not a Court and it didn’t identify the person. What Mr Lombe did was unlawful and the sequestration order didn’t say he could sell the properties.
Mr Rahman also said that “all of the judges of the cases that he has brought, what they have done, all they have done, is wrong”, and as I have already identified, pressed the issue of transfer from the State Supreme Court to the Federal Court. Mr Rahman makes the further points that none of the creditors have brought any evidence before this Court that he owes any money, and that he is presently employed, he does not owe any money, and he refers to persons having taken $1 million. I infer that he claims that the trustee, Mr Lombe, has taken that money. He also refers to s.127 of the Real Property Act1900 (NSW), and s.37 of the Limitation Act1969 (NSW).
Mr Spencer says, correctly, that s.153B(2) has no application in the present case because it refers to the case of a debtor’s position, and that is not the case here. In the present case, Mr Rahman was made bankrupt on a creditor’s petition.
The evidence before me from Mr Lombe is that as at the date of the sequestration order in 2012, Mr Rahman held cash in the amount, as I have identified, of $57,303 in an account with the Commonwealth Bank. Mr Rahman, however, had debts totalling $107,241, and that left a cash deficiency of approximately $50,000 (in 2012).
Mr Rahman says he did not owe any money to the Bank. However, Mr Rahman was not made bankrupt because he did not owe any money to the Commonwealth Bank, he was made bankrupt because of the debts that he did not pay in response to a bankruptcy notice that was issued against him, and Ms Dubs’ creditor’s petition, following upon that failure to pay.
Whilst Mr Rahman has appended to his affidavit certificates of judgment in relation to the costs orders on which the bankruptcy notice rests, I note that those judgments have not been set aside, and that, prima facie, the certificates of judgment evidence the judgments for the debt claimed in the notice. I am of the view that they are sufficient to support the issue of the bankruptcy notice.
Mr Rahman’s appeal from the sequestration order was dismissed. Mr Rahman has not demonstrated before me that there is any miscarriage or error that was not available to raise on that appeal. Accordingly, I am unable to see today why there is any miscarriage or error and why the sequestration order should not have been made.
I note also that Mr Rahman did not provide a comprehensive disclosure of his financial affairs, nor did he complete a statement of affairs within 14 days of the sequestration order. Given that Mr Rahman was in default of the legal obligation he had at that time to disclose his financial position, I am not able to infer that Mr Rahman, back in 2012, had liquid assets with which to satisfy the debts that the evidence demonstrates he then had. It follows that I am not persuaded that the sequestration order that was made should not have been made.
Whilst Mr Rahman, throughout the day, and repeatedly in the course of my delivery of these reasons, has forcefully stated that he is not bankrupt and he is solvent, the issue for me is what the position was back in 2012. The material that I have before me, of the facts and circumstances as at 2012, does not establish to my satisfaction that the sequestration order should not have been made.
I am supported in this conclusion by the judgments of Raphael FM and Flick J, in their decisions in the proceedings concerning Mr Rahman that were before them, and most relevantly, on any question of the constitutional matter, that the High Court of Australia has determined it did not raise any ground of special leave when Mr Rahman’s application was heard by it.
Mr Rahman has forcefully put his case today, and I appreciate his deep concern that the bankruptcy will not be annulled. I appreciate that separate proceedings have been brought in the Federal Court by the Trustee. Although those proceedings are not before me, I am informed by Mr Rahman and Mr Spencer that they have been stood over to 10 October 2019. It appears that the Federal Court proceeding is brought by Mr Lombe for directions under the Act in relation to dealing with the remainder of the property of Mr Rahman’s estate as a bankrupt, and I apprehend that that property will include his residential premises. It is not for this Court to make any order or comment in relation to those proceedings. I merely say that I have witnessed Mr Rahman’s distress at the prospect of those proceedings.
In case I were to be satisfied, which I am not, that the sequestration order should not have been made, it is appropriate to identify some of the discretionary reasons that have been put before me, as matters that I should take into account why, in my discretion, I would not annul the bankruptcy. I simply record these:
(a)it is more than seven years since the sequestration order was made, and there has been ample time and opportunity for Mr Rahman to challenge the debts concerned. There is no evidence before me in this Court that Mr Rahman challenged the debts, other than the proceedings before McCallum J and through to the New South Wales Court of Appeal, which were concerned with the making of the original order;
(b)Mr Spencer submits that Mr Rahman’s conduct in opposing the Trustee, that is, Mr Lombe, at every turn, and in prosecuting a multiplicity of proceedings, have caused an enormous, unnecessary expense, as well as unwarranted use of scarce judicial resources. It would be apparent that the multiplicity of proceedings has been an expensive matter, and those expenses will have added to the debts and the costs in administering the estate. In addition, there is evidence before me that Mr Rahman negotiated a settlement with the trustee, but has not, as Mr Spencer has put it, abided by his side of the bargain. Whilst Mr Rahman protests about that settlement today, I merely note that there appears to have been an opportunity for Mr Rahman to have avoided some of the ongoing costs that are being incurred in this proceeding;
(c)I note that in the event there is a surplus in the estate, then creditors who have interest bearing debts have a right to interest. Mr Spencer makes the point that if the bankruptcy were annulled, there would no longer be any assets in the hands of the Trustee from which to pay that entitlement to interest. I note that Mr Lombe acts as trustee, and in that position he has obligations, which there is no evidence he has not properly discharged.
It follows that the Application should be dismissed with costs. Whilst Mr Rahman makes vigorous submissions that there has been fraud and judgments are wrongful, I am unable, on the material before me, to identify any substantiation for those claims.
Recusal Application
It remains for me to provide short reasons in relation to Mr Rahman’s application in a case. Mr Rahman made submissions in relation to the first court date listing on 8 February 2019. In sum, he submits that he submitted all documents relating to service on three respondents, that those respondents did not submit representations within the timeframe to defend, and that I did not make orders on default. I have dealt with these matters by my reference to the submitting appearances of the First and Second Respondents. Mr Lombe has at all times been represented in this proceeding, and counsel have appeared on behalf of Mr Lombe at all directions hearings, and at this hearing.
Mr Rahman otherwise appears to make complaint that at the directions hearings before me I did not make final orders, as sought by Mr Rahman, but made interlocutory orders for the conduct of the proceeding. In relation to the directions I made on 22 March 2019, Mr Rahman’s complaint, so far as it is able to be ascertained from his submissions, is that I did not give summary judgment because the First and Second Respondents were not present, notwithstanding the submitting appearances, and that I did not then deal with Mr Rahman’s notice of constitutional matter.
Mr Rahman makes the complaint that I made orders varying Ms Beange’s proposed draft orders. Mr Rahman then refers to his strong objections, and refers back to his complaints dating from the proceedings before Raphael FM.
Finally, Mr Rahman asserts in paragraph 10GA of his affidavit of 19 July 2019 that (without alteration):
10GA.Hon. BAIRED,J could not defend any submission of challenge submitted as expressed in the Constitutional issues , Doctrine of Case law, Constitutional Court 'but made 'assertions and referred I will follow what other Justices made decisions. The decisions which made by earlier 'arbitrators; as Judicial offenders and commissioned offences, Constitutional treasons relating to the administrations of justice under above provisions under Crimes Act (Cth ) , Criminal Code Ac (Cth) by Magistrates and Justices initially in Proceedings Dubs v Rahman- SYG 922/2012 FM RAPHAEL ,Sequestrations orders for Dubs Identity theft , Not Financial Institutes , Appeal NSD 1092/2012, Rahman v Dubs , Decisions on 5 October 2012 by FLICK J , claims S51(xvii) , HCA Appeal Special Leave [ No right ,as Neo -slave, used discretion Institutional Racism ] S314/2012 , Decision by Hon. KIEFEL & GAGLER JJ, HCA S314 /2012 [2012] HCASL, 13 March 2013. Decisions does not mention under what Constitutional provisions or other acts invest Jurisdictions to bring proceedings from States Court .It is Gross violations of Doctrines of Case Law" :
Mr Rahman also makes complaint, as he expressed it in paragraph 10GC, that I:
… could not withhold her anguish and called a security guard without knowing the Applicant –
A list of conduct of which complaint is made is then set out at paragraph 10H, and various other complaints are made. The remainder of Mr Rahman’s submissions were to similar effect. Mr Rahman also asked that I identify that I am not a professional in this Court in bankruptcy and constitutional law.
I have had the benefit of Barnes J’s reasons in Lombe, and Barnes J’s observations at [12] to [15], mutatis mutandis, are apposite to the matter before me. In relation to the matter of bias, Mr Rahman now appears to make his submission on the basis that I am not qualified to be a judge. I do not propose to engage in debate with Mr Rahman. I adopt and reiterate [16], [17] and [18] of Barnes J’s reasons in Lombe:
[16]The principles in relation to apprehended bias are well‑established. In Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63, Gleeson CJ, McHugh, Gummow and Hayne JJ set out the test as follows at [6]:
…a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide…
(and see Michael Wilson & Partners Ltd v Nicholls (2011) 244 CLR 427; [2011] HCA 48 at [31]).
[17]This principle was further explained in Ebner at [8]:
The apprehension of bias principle admits of the possibility of human frailty. Its application is as diverse as human frailty. Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The bare assertion that a judge (or juror) has an “interest” in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility of departure from impartial decision making, is articulated. Only then can the reasonableness of the asserted apprehension of bias be assessed.
[18]Hence, as pointed out by Heydon, Kiefel and Bell JJ in British American Tobacco Australia Services Limited v Laurie (2011) 242 CLR 283; [2011] HCA 2 at [139], it is “the perception of the hypothetical observer that provides the yardstick”.
Mr Rahman is not legally represented. I have endeavoured to ascertain, and consider the basis on which Mr Rahman has sought that I recuse myself. That basis appears to have narrowed down during the course of today, to the position that whilst appointed as a judge of this Court, I did not, prior to becoming a judge of this Court, have experience or expertise in bankruptcy or constitutional matters. That, however, is not to the point. I have had the benefit of the assistance of counsel experienced in bankruptcy, including in the bankruptcy matter brought today, and also, relevantly to this proceeding, I have had the benefit of the decisions of Federal Magistrate Raphael, Judge Barnes, Flick, and Gleeson JJ, and the Justices of the High Court, in deciding the various proceedings concerning Mr Rahman.
In my view, none of the matters raised by Mr Rahman are such as to lead a reasonable, independent observer to conclude that I might not bring an impartial mind to the resolution of the questions I am required to decide in this case, or are otherwise such as to establish a proper basis for recusal. Furthermore, whilst Mr Rahman has taken particular issue with my standing as a judge of this Court, I do not consider that those claims have any merit, or are matters that can be raised in this Court.
To the extent that Mr Rahman’s submission is to the effect that as a judge of this Court I am not entitled to hear his case, that is plainly fanciful. Further, to the extent that there remains any disagreement that Mr Rahman has with the case management procedure adopted on either the first or second directions hearings, I am not satisfied that any of his disagreements support a conclusion that a fair minded lay observer might reasonably apprehend that I might not bring an impartial mind to the resolution of the matter before the Court. I otherwise adopt, to the extent necessary, what Barnes J said in Lombe at [24], [25], [26], [28] and [29].
In conclusion, as I have indicated earlier today, I dismiss the interlocutory application.
Finally, I note that Mr Rahman made his request for publication of these reasons, along with further submissions that I be removed from my position as a Judge of the Federal Circuit Court of Australia, to the Registry on 20 March 2020, after the declaration of the present COVID-19 crisis, and some 178 days after I delivered my reasons ex tempore.
I certify that the preceding seventy three (73) paragraphs are a true copy of the reasons for judgment of Judge Baird.
Associate:
Date: 24 April 2020
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