Rana v Musolino

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FEDERAL COURT OF AUSTRALIA

Rana v Musolino [2010] FCA 476

Citation: Rana v Musolino [2010] FCA 476
Appeal from: Rana v Musolino [2009] FCA 1050
Parties: RANJIT SHAMSHER JUNG BAHADUR RANA v ROSEMARIE MUSOLINO, OFFICIAL TRUSTEE IN BANKRUPTCY and AUSTRALIAN GOVERNMENT SOLICITOR
File number: SAD 141 of 2009
Judge: MCKERRACHER J
Date of judgment: 14 May 2010
Catchwords: BANKRUPTCY - application for leave to appeal from interlocutory judgment - right of a bankrupt to issue proceedings - s116 of Bankruptcy Act 1966 - action not in relation to personal injuries or wrongs - severance of actions - hopeless claims - leave to appeal refused
Legislation:

Bankruptcy Act 1966 (Cth) ss 58(1)(a), 60(2), 60(3), 60(4), 116(1), 116(2), 178
Federal Court of Australia Act 1976 (Cth) s 31A

Federal Court Rules O 20 r 5, O 52 r 10
Cases cited: Bryant v Commonwealth Bank of Australia (1997) 75 FCR 545
Cox v Journeaux (No 2) (1935) 52 CLR 713
Daemar v Industrial Commission of New South Wales and Others (1988) 12 NSWLR 45
Decor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397
Faulkner v Bluett (1981) 52 FLR 115
Fitzpatrick v Keelty [2008] FCA 35
Hamilton v Young [2008] 1 Qd R 507
Kowalski v MMAL Staff Superannuation Fund Pty Ltd and Another (2009) 178 FCR 401
Niemann v Electronic Industries Ltd [1978] VR 431
Rana v University of Adelaide [2008] FCA 365
Rogers v Asset Loan Co Pty Ltd [2007] FCA 195
Sharp v Deputy Commissioner of Taxation (Cth) (1988) 88 ATC 4184
Worchild v University of Queensland Law Society Inc (2006) 234 ALR 179
Date of hearing: 8 February 2010
Place: Perth (via video link to Adelaide)
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 65
The Applicant represented himself.
Counsel for the Second Respondent: G Gretsas
Solicitor for the Second Respondent: Gretsas & Associates

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 141 of 2009
BETWEEN:

RANJIT SHAMSHER JUNG BAHADUR RANA
Applicant
AND:

ROSEMARIE MUSOLINO
First Respondent

OFFICIAL TRUSTEE IN BANKRUPTCY
Second Respondent

AUSTRALIAN GOVERNMENT SOLICITOR
Third Respondent

JUDGE:

MCKERRACHER J

DATE OF ORDER:

14 May 2010

WHERE MADE:

Perth (via video link to Adelaide)

THE COURT ORDERS THAT:

1.The application for leave to appeal is refused. 

2.The applicant is to pay the costs of the respondents, to be taxed if not agreed.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.


IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 141 of 2009
BETWEEN:

RANJIT SHAMSHER JUNG BAHADUR RANA
Applicant
AND:

ROSEMARIE MUSOLINO
First Respondent

OFFICIAL TRUSTEE IN BANKRUPTCY
Second Respondent

AUSTRALIAN GOVERNMENT SOLICITOR
Third Respondent

JUDGE:

MCKERRACHER J

DATE:

14 may 2010

PLACE:

Perth (via video link to Adelaide)

REASONS FOR JUDGMENT

INTRODUCTION

  1. The applicant, Mr Rana, applies for leave to appeal. The decision from which leave to appeal is sought…

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Details
Case
[2010] FCA 476
Decision Date

CaseChat Overview and Summary

The case of Rana v Musolino involved Mr Rana, who had become bankrupt, challenging the actions of his trustee in bankruptcy. The primary dispute was whether the trustee had the authority to discontinue a proceeding in the High Court that Mr Rana had initiated despite his bankruptcy. Mr Rana argued that the proceeding, which sought to overturn a previous dismissal by another judge of the Federal Court, constituted a personal wrong to him and thus could not be discontinued by the trustee. The primary judge addressed the matter under section 178 of the Bankruptcy Act 1966, which allows a bankrupt to seek a court order if they are affected by an act or decision of the trustee. Mr Rana's initial application was dismissed, and he sought leave to appeal this decision.

The legal issues before the court were primarily concerned with the statutory framework governing the rights and obligations of a trustee in bankruptcy and whether Mr Rana's proceeding in the High Court constituted a personal wrong exempt from the trustee's control. The court had to determine whether the primary judge's decision to dismiss Mr Rana's challenge was correct, and if there was sufficient doubt or potential for injustice to warrant an appeal. The reasoning of the primary judge was examined to ascertain whether it contained any errors and whether the dismissal was justified. Ultimately, the court found no basis for relief in Mr Rana's claims and upheld the primary judge's decision, refusing the application for leave to appeal and ordering Mr Rana to pay the respondents' costs.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

The real question ventilated by the argument before the primary judge, as before me, was the existence or otherwise of power on the part of the Trustee to file the notice of discontinuance. BACKGROUND Mr Rana appears in person. On 13 August 2008 he became bankrupt. On 25 August 2008, notwithstanding his bankruptcy, he issued the proceeding in the High Court. His trustee in bankruptcy discontinued that proceeding on 23 December 2008. Mr Rana contends that the High Court proceeding which, in turn, challenged an earlier dismissal by another judge of this Court was a proceeding in the nature of a personal wrong to him and as such, could not be discontinued by the Trustee. The primary judge treated the application as being a challenge under s 178 of the Bankruptcy Act 1966 (Cth) (the Bankruptcy Act). That section provides that a bankrupt may apply to the Court (if he or she is affected by an act, omission or a decision of the Trustee) for the Court to make such order in the matter as it thinks just and equitable. The application must be brought within 60 days from the day the bankrupt became aware of the Trustee’s act. The original application which his Honour dismissed did not purport to be cast as an application under s 178 of the Bankruptcy Act. His Honour treated it as such as that provision was the only legislative or other lawful basis for a challenge to be brought to the Trustee’s action. THE APPROPRIATE TEST FOR LEAVE TO APPEAL Although the effect of his Honour’s decision was to finally dismiss the proceedings, an application under s 31A FCA is to be treated as an interlocutory application and, accordingly, leave to appeal the decision must be sought and obtained before an appeal may be pursued: Kowalski v MMAL Staff Superannuation Fund Pty Ltd and Another (2009) 178 FCR 401 per Spender, Graham and Gilmour JJ (at [32]-[44]). Leave to appeal from interlocutory judgments of the Court is governed by O 52 r 10 FCR. In order to justify the grant of leave to appeal from an interlocutory judgment, the Court must be satisfied that:·in all its circumstances the decision is attended by sufficient doubt to warrant it being reconsidered by the Full Court; and·substantial injustice would result if leave were refused, supposing the decision to be wrong (Decor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397; Niemann v Electronic Industries Ltd [1978] VR 431). It has also been observed (by Burchett J in Sharp v Deputy Commissioner of Taxation (Cth) (1988) 88 ATC 4184 at 4186) that those two considerations bear on each other ‘so that the degree of doubt which is sufficient in one case may be different from that required in another. Ultimately a discretion must be exercised on what may be a fine balancing of considerations’. STATUTORY FRAMEWORK In relation to the rights and obligations of the Trustee arising as and from the date of bankruptcy, the provisions of ss 58, 60 and 116 of the Bankruptcy Act provide relevantly:58 Vesting of property upon bankruptcy – general rule(1) Subject to this Act, where a debtor becomes a bankrupt:(a)the property of the bankrupt, not being after-acquired property, vests forthwith in the Official Trustee … 60Stay of legal proceedings(1)…(2)An action commenced by a person who subsequently becomes a bankrupt is, upon his or her becoming a bankrupt, stayed until the trustee makes election, in writing, to prosecute or discontinue the action. (3)If the trustee does not make such an election within 28 days after notice of the action is served upon him or her by a defendant or other party to the action, he or she shall be deemed to have abandoned the action.(4)Notwithstanding anything contained in this section, a bankrupt may continue, in his or her own name, an action commenced by him or her before he or she became a bankrupt in respect of:(a)any personal injury or wrong done to the bankrupt, his or her spouse or de facto partner or a member of his or her family …

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The process of reasoning adopted by the learned primary judge, in my view, is without error. As found by the primary judge, there is no basis for relief at all in relation to any of the first four actions in respect of which complaint was raised.CONCLUSION For all those reasons, it is manifestly clear that the decision of the primary judge was correct. Further, even if that is wrong, no injustice arises as the original dismissal by Lander J was also clearly correct. For those reasons the application for leave to appeal will be refused. The applicant is to pay the costs of the respondents, to be taxed if not agreed.

Ratio Decidendi

Legal Principle Established

I have added emphasis to the passage cited from Cox v Journeaux (No 2) (1935) 52 CLR 713. See also Fitzpatrick v Keelty [2008] FCA 35 per Moore J (at [39]-[50).THE DECISIONS REQUIRING CONSIDERATION As has been seen, if a chose in action is in respect of personal injuries and/or wrongs done to a bankrupt, different considerations apply as to how it should be treated. Before addressing the basis of the challenge, it is necessary therefore to appreciate the content of the ‘show cause’ proceeding to which the notice of discontinuance related. More importantly, the nature of the decision attacked in the show cause proceeding must also be understood. The notice of discontinuance relates to Mr Rana’s challenge (in the High Court) to the earlier dismissal of proceedings by another judge of this Court, Lander J in SAD 12 of 2008 (Rana v University of Adelaide [2008] FCA 365) (SAD 12). That case arose as a result of a Medico Legal Report written by a Professor Goldney at the request of the AGS. The AGS itself was joined as a fourth respondent in that proceeding. The Report was requested for use in a proceeding in the Administrative Appeals Tribunal (AAT) which had been brought by Mr Rana against the Repatriation Commission. That proceeding in turn, amongst several others in which Mr Rana had been involved, raised questions as to the circumstances of his discharge from the Army in which he had served as a member from October 1980 to July 1982. For the purposes of the AAT proceedings, the AGS, representing the Chief of Army, (the fifth respondent in SAD 12) and also the Repatriation Commission, sought to have Mr Rana examined by Professor Goldney. Professor Goldney was at the relevant time the Professor of Psychiatry at the University of Adelaide. At the time that assistance was sought, the AGS and its client (the Repatriation Commission) were not aware of a Deed of Settlement between Mr Rana and the University of Adelaide. In particular, the AGS was unaware of the restrictions the Deed imposed on Mr Rana being within the University and its grounds. Mr Rana in fact raised with the AGS and the University the fact that he could not be examined by Professor Goldney at the University of Adelaide because that would put him in breach of the Deed between himself and the University. The University of Adelaide pointed out that the Deed did not prevent Mr Rana from having access to Professor Goldney but, in any event, there was no legal impediment to Mr Rana being examined by Professor Goldney in Professor Goldney’s private capacity provided that the examination occurred at premises other than the University premises. That is what ensued and Professor Goldney duly gave his opinion. Mr Rana contended that the responses given in the Report by Professor Goldney were in breach of the University’s obligations under the Deed not to disparage or otherwise adversely comment upon him. In addition to that breach of the provision of the Deed, it was asserted that the University had contravened s 52 TPA, breached a duty of care owed to Mr Rana and had defamed him.