Registrar, Supreme Court of Norfolk Island v Walsh
[2021] NFSC 4
•11 June 2021
SUPREME COURT OF NORFOLK ISLAND
Registrar, Supreme Court of Norfolk Island v Walsh [2021] NFSC 4
File number(s): SC 2 of 2016 Judgment of: RARES J Date of judgment: 11 June 2021 Date of orders: 17 June 2021 Catchwords: CONTEMPT OF COURT – where Court in 2018 found respondent legal practitioner should be suspended from practice in Norfolk Island for professional misconduct – where court ordered respondent to repay another practitioner with interest money paid by reason of respondent’s false representation and to pay Registrar taxed costs of disciplinary proceeding – where Registrar brought contempt application against respondent for failure over three years to comply with to Court’s orders to pay other practitioner or Registrar’s taxed costs
COURTS AND JUDGES – inherent power of Supreme Court as superior court of record – whether inherent power to punish for contempt of orders made by the Court – nature of inherent power – where exercise of inherent power of superior court of record to punish respondent for contempt necessary when respondent deliberately flouts Court order – where respondent had ample means to comply with orders to pay legal practitioner and to make payments towards Registrar’s taxed costs – where respondent knowingly chose to ignore Court orders – Held: respondent guilty of contempt
Legislation: Bankruptcy Act 1966 (Cth) s 9A
Norfolk Island Act 1957 (Cth) s 18(3)
Norfolk Island Act 1979 (Cth) s 52(1)
Bankruptcy Act 2006 (NI)
Court Procedures Rules 2006 (ACT) Sch 2
Legal Profession Act 1993 (NI)
Borrie and Lowe's Law of Contempt (2nd ed, 1983)
Cases cited: Australasian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98
Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 256 CLR 375
Grassby v The Queen (1989) 168 CLR 1
Kazal v Thunder Studios Inc (California) (2017) 256 FCR 90
Matthews v Australian Securities and Investments Commission [2009] NSWCA 155
Reg. v, Forbes; Ex parte Bevan (1972) 127 CLR 1
Registrar, Supreme Court of Norfolk Island v Walsh (No 4) [2017] NFSC 7
Registrar, Supreme Court of Norfolk Island v Walsh (No 5) [2018] NFSC 1
Witham v Holloway (1995) 183 CLR 525
Number of paragraphs: 71 Date of hearing: 11 June 2021 Counsel for the Applicant: Mr G. Johnson Solicitor for the Applicant: Sparke Helmore Lawyers Solicitor for the Respondent: The respondent did not appear ORDERS
SC 2 of 2016 BETWEEN: REGISTRAR OF THE SUPREME COURT OF THE NORFOLK ISLAND
Applicant
AND: JOHN WALSH
Respondent
ORDER MADE BY:
RARES J
DATE OF ORDER:
17 JUNE 2021
PENAL NOTICE
TO:John Walsh also known as John Walsh of Brannagh, Sir John Walsh of Brannagh and the Duke de Ronceray
IF YOU (BEING THE PERSON BOUND BY THIS ORDER):
(A)REFUSE OR NEGLECT TO DO ANY ACT WITHIN THE TIME SPECIFIED IN THIS ORDER FOR THE DOING OF THE ACT; OR
(B)DISOBEY THE ORDER BY DOING AN ACT WHICH THE ORDER REQUIRES YOU NOT TO DO,
YOU WILL BE LIABLE TO IMPRISONMENT, SEQUESTRATION OF PROPERTY OR OTHER PUNISHMENT.
ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS YOU TO BREACH THE TERMS OF THIS ORDER MAY BE SIMILARLY PUNISHED.
TO:John Walsh
This is a ‘freezing order’ made against you on 17 June 2021 by Justice Rares following the hearing on 11 June 2021 at which you did not attend after the Court was given the undertakings set out in Schedule A to this order and after the Court read the affidavit listed in Schedule B to this order.
THE COURT ORDERS THAT:
INTRODUCTION
1.This order is to be served by the applicant sending an email addressed to the respondent attaching a sealed copy of the order to the following email addresses:
2.The respondent is taken to have been served with a copy of this order seven (7) days after the sending of the emails referred to in paragraph 1 above.
3.Subject to the next paragraph, this order has effect up to and including 6 August 2021 (the Return Date). On the Return Date at 10:15 am there will be a further hearing in respect of this order before Justice Rares.
4.Anyone served with or notified of this order, including you, may apply to the Court at any time to vary or discharge this order or so much of it as affects the person served or notified.
5.In this order:
(a)‘third party’ means a person other than you and the applicant;
(b)‘unencumbered value’ means value free of mortgages, charges, liens or other encumbrances.
6.
(a)If you are ordered to do something, you must do it by yourself or through directors, officers, partners, employees, agents or others acting on your behalf or on your instructions.
(b)If you are ordered not to do something, you must not do it yourself or through directors, officers, partners, employees, agents or others acting on your behalf or on your instructions or with your encouragement or in any other way.
FREEZING OF ASSETS
7.
(a)You must not remove from Norfolk Island or in any way dispose of, deal with or diminish the value of any of your assets in Norfolk Island (‘Island assets’) up to the unencumbered value of AUD$144,209.36 (‘the Relevant Amount’).
(b)If the unencumbered value of your Island assets exceeds the Relevant Amount, you may remove any of those assets from Norfolk Island or dispose of or deal with them or diminish their value, so long as the total unencumbered value of your Norfolk Island assets still exceeds the Relevant Amount.
(c)If the unencumbered value of your Norfolk Island assets is less than the Relevant Amount, and you have assets outside Norfolk Island, including on mainland Australia (‘ex-Island assets’):
(i)You must not dispose of, deal with or diminish the value of any of your Island assets and ex-Island assets up to the unencumbered value of your Island and ex-Island assets of the Relevant Amount; and
(ii)You may dispose of, deal with or diminish the value of any of your ex-Island assets, so long as the unencumbered value of your Island assets and ex-Island assets still exceeds the Relevant Amount.
8.For the purposes of this order,
(a)your assets include:
(i)all your assets, whether or not they are in your name and whether they are solely or co-owned;
(ii)any asset which you have the power, directly or indirectly, to dispose of or deal with as if it were your own (you are to be regarded as having such power if a third party holds or controls the asset in accordance with your direct or indirect instructions); and
(iii)the following assets in particular:
A.any money in account 062-950 10004014 in the name of United Pacific Corporation Pty Ltd - Australian Constitutional Trust at Commonwealth Bank of Australia , Norfolk Island branch.
B.any money in account 062-950 1000 4030 in the name of Dr John Walsh of Brannagh at PO Box 223 Watermill Valley Norfolk Island 2899 at Commonwealth Bank of Australia , Norfolk Island branch.
(b)the value of your assets is the value of the interest you have individually in your assets.
PROVISION OF INFORMATION
9.Subject to paragraph 10, you must:
(a)at or before the further hearing on the Return Date (or within such further time as the Court may allow) to the best of your ability inform the applicant in writing of all your assets world-wide, giving their value, location and details (including any mortgages, charges or other encumbrances to which they are subject) and the extent of your interest in the assets;
(b)within 15 working days after being served with this order, swear and serve on the applicant an affidavit setting out the above information.
10.
(a)This paragraph (10) applies if you are not a corporation and you wish to object to complying with paragraph 9 on the grounds that some or all of the information required to be disclosed may tend to prove that you:
(i)have committed an offence against or arising under an Australian law or a law of a foreign country; or
(ii)are liable to a civil penalty.
(b)This paragraph (10) also applies if you are a corporation and all of the persons who are able to comply with paragraph 9 on your behalf and with whom you have been able to communicate, wish to object to your complying with paragraph 9 on the grounds that some or all of the information required to be disclosed may tend to prove that they respectively:
(i)have committed an offence against or arising under an Australian law or a law of a foreign country; or
(ii)are liable to a civil penalty.
(c)You must:
(i)disclose so much of the information required to be disclosed to which no objection is taken; and
(ii)prepare an affidavit containing so much of the information required to be disclosed to which objection is taken, and deliver it to the Court in a sealed envelope; and
(iii)file and serve on each other party a separate affidavit setting out the basis of the objection.
EXCEPTIONS TO THIS ORDER
11.This order does not prohibit you from:
(a)paying up to $400 a week on your ordinary living expenses;
(b)paying $5,000 on your reasonable legal expenses;
(c)dealing with or disposing of any of your assets in the ordinary and proper course of your business, including paying business expenses bona fide and properly incurred; and
(d)in relation to matters not falling within (a), (b) or (c), dealing with or disposing of any of your assets in discharging obligations bona fide and properly incurred under a contract entered into before this order was made, provided that before doing so you give the applicant, if possible, at least two working days written notice of the particulars of the obligation.
12.You and the applicant may agree in writing that the exceptions in the preceding paragraph are to be varied. In that case the applicant or you must as soon as practicable file with the Court and serve on the other a minute of a proposed consent order recording the variation signed by or on behalf of the applicant and you, and the Court may order that the exceptions are varied accordingly.
13.
(a)This order will cease to have effect if you:
(i)pay the sum of $144,209.36 into Court; or
(ii)pay that sum into a joint bank account in the name of your lawyer and the lawyer for the applicant as agreed in writing between them; or
(iii)provide security in that sum by a method agreed in writing with the applicant to be held subject to the order of the Court.
(b)Any such payment and any such security will not provide the applicant with any priority over your other creditors in the event of your insolvency.
(c)If this order ceases to have effect pursuant 12(a) above, you must as soon as practicable file with the Court and serve on the applicant notice of that fact.
COSTS
14.The costs of this application are reserved to the Court hearing the application on the Return Date.
PERSONS OTHER THAN THE APPLICANT AND RESPONDENT
15.Set off by banks
This order does not prevent any bank from exercising any right of set off it has in respect of any facility which it gave you before it was notified of this order.
16.Bank withdrawals by the respondent
No bank need inquire as to the application or proposed application of any money withdrawn by you if the withdrawal appears to be permitted by this order.
17.Persons outside Australia
(a)Except as provided in subparagraph (b) below, the terms of this order do not affect or concern anyone outside Australia.
(b)The terms of this order will affect the following persons outside Australia:
(i)you and your directors, officers, employees and agents (except banks and financial institutions);
(ii)any person (including a bank or financial institution) who:
A.is subject to the jurisdiction of this Court; and
B.has been given written notice of this order, or has actual knowledge of the substance of the order and of its requirements; and
C.is able to prevent or impede acts or omissions outside Australia which constitute or assist in a disobedience of the terms of this order; and
(iii)any other person (including a bank of financial institution), only to the extent that this order is declared enforceable by or is enforced by a court in a country or state that has jurisdiction over that person or over any of that person’s assets.
18.Assets located outside Australia
Nothing in this order shall, in respect of assets located outside Australia, prevent any third party from complying or acting in conformity with what it reasonably believes to be its bona fide and properly incurred legal obligations, whether contractual or pursuant to a court order or otherwise, under the law of the country or state in which those assets are situated or under the proper law of any contract between a third party and you, provided that in the case of any future order of a court of that country or state made on your or the third party’s application, reasonable written notice of the making of the application is given to the applicant.
REASONS FOR JUDGMENT
(REVISED FROM THE TRANSCRIPT)RARES J:
On 14 April 2016, the Registrar of the Court commenced proceedings seeking the removal from the Register of Practitioners of the Court of the respondent, who goes by a variety of names, including John Walsh, John Walsh of Brannagh, Sir John Walsh of Brannagh, Sir John Walsh Brannagh, Dr Sir John Walsh of Brannagh and the Duke de Ronceray. Those are names that he uses that appear in the evidence, including in his various dealings with financial institutions. At one stage, Mr Walsh had been a member of the Victorian bar.
On 22 December 2017, Gilmour J found (Registrar, Supreme Court of Norfolk Island v Walsh (No 4) [2017] NFSC 7) that Mr Walsh was guilty of professional misconduct under the provisions of the Legal Profession Act 1993 (NI) by:
·making false representations to Dr Ping-Fat Sze, another legal practitioner, that it was necessary for him to become a member of the Norfolk Island Bar Association, by a payment of the amount of $200 to that entity, in order to obtain registration as a legal practitioner in Norfolk Island under the Legal Profession Act, when there was no such requirement and that association was not a professional representative body for legal practitioners practicing in the Island,
·making false representations to the Court, as well as to the public generally through the websites of the Victorian Bar and the International Tribunal of Natural Justice (the ITNJ), that Mr Walsh:
(a)held a recognised judicial office as the ‘Chief Justice’ of the ITNJ when it was not a proper court of law or tribunal established under any statute, international treaty or convention of any kind, and
(b)is a knight under the Australian or Imperial honours system entitling him to use the honorific of ‘Sir’.
His Honour also found Mr Walsh guilty of unsatisfactory professional conduct by:
·failing to respond personally, and within a reasonable time, to the Registrar concerning a complaint as to his professional conduct made by Dr Sze, and
·knowingly or recklessly making false statements and comments of a discourteous and offensive nature to the Court regarding other legal practitioners in the Island.
On 23 February 2018, his Honour ordered (Registrar, Supreme Court of Norfolk Island v Walsh (No 5) [2018] NFSC 1) that:
·Mr Walsh’s name be removed from the Register and his right to practice as a lawyer in the Island be suspended for a period of 10 years, and
·the Registrar notify all professional bodies in Australia responsible for overseeing professional discipline of legal practitioners, as well as the International Bar Association and the South Pacific Lawyers Association, of the orders made on 22 December 2017 and 23 February 2018, and
·within 28 days of 23 February 2018, Mr Walsh reimburse Dr Sze the sum of $200 with interest payable from 1 July 2007, calculated by the Court pursuant to Sch 2 of the Court Procedures Rules 2006 (ACT), and
·Mr Walsh to pay the Registrar’s costs to be taxed if not agreed.
On 1 March 2018, Gilmour J made the following order that quantified the total amount to be paid to Dr Sze:
Pursuant to Order 4 of the Orders made on 23 February 2018, the respondent pay to Dr Ping-Fat Sze the sum of AUD 433.69
That order, as entered, contained a notation that the sum included interest of $233.69 on the $200 judgment sum calculated between 1 July 2007 and 23 February 2018.
As appears in the Registrar’s affidavit made on 9 December 2020, the Registrar’s solicitor emailed his Honour’s order of 1 March 2018 to an email address commencing “johnwb.act” (the johnwb.act email address) that Mr Walsh later used on 28 May 2018 when instructing his solicitors to pay the net proceeds of sale of the Norfolk Island real property jointly owned by himself and Pauline Butler to Ms Butler’s account, notwithstanding that the named vendors were both of them. I am satisfied beyond reasonable doubt that on or about 1 March 2018, Mr Walsh received the email that his Honour’s associate sent on 1 March 2018 to the johnwb.act email address and that he had notice of the Court’s order that he had to pay Dr Sze $433.69.
On 15 May 2020, the Registrar filed an application in proceeding seeking declarations that Mr Walsh was in contempt of Court for failing to pay Dr Sze $433.69, or the Registrar’s costs that had been taxed in the sum of $143,775.67, and orders punishing those alleged contempts. I began hearing that application on 11 December 2020, but adjourned to today to enable the Registrar to obtain further evidence.
Dr Sze, who resides in Hong Kong, made three affidavits. The first, made on 22 April 2020, confirmed that he was the person to whom Gilmour J had ordered Mr Walsh pay $433.69 and that he had not been paid that money over the preceding two years. Dr Sze made two further affidavits, the most recently being made on 8 June 2021, confirming that he has not received any payment at all from Mr Walsh.
I am satisfied beyond reasonable doubt that Dr Sze has not been paid anything by or on behalf of Mr Walsh to discharge his judgment debt of $433.69.
Mr Walsh’s awareness of the orders to pay Dr Sze and the Registrar’s taxed costs
On 26 March 2018, Mr Walsh filed in the Federal Court of Australia an application for an extension of time to appeal from Gilmour J’s orders and declarations made on 22 December 2017 and 23 February 2018.
On 12 July 2020, Mr Walsh appeared in person before Wigney J and made submissions. On 19 July 2018, Wigney J, in the exercise of the appellate jurisdiction of the Federal Court, dismissed that application and ordered Mr Walsh to pay the Registrar’s costs. Wigney J found that none of Mr Walsh’s proposed grounds of appeal appeared to have any discernible merit and that Mr Walsh had not given an adequate explanation for not having filed a notice of appeal in time.
There can be no doubt at all, and I am satisfied beyond reasonable doubt, that in prosecuting the application for extension of time and leave to appeal, Mr Walsh was fully aware of the orders that he had to pay, and had not done so, first, Dr Sze $433.69, and, secondly, the Registrar’s taxed costs of the proceeding before Gilmour J.
Mr Walsh’s means and activities after 1 March 2018
After 1 March 2018, despite having had ample means to pay Dr Sze, Mr Walsh deliberately determined that he would not do so. In making the following findings, I have been satisfied beyond reasonable doubt that they are correct based on the uncontested affidavit evidence before me, including the documents and financial records annexed or exhibited to those affidavits.
Between 23 February 2018 and 7 December 2020, Mr Walsh received fortnightly deposits of pension payments totalling $100,973.72 into a smart access account with the Commonwealth Bank of Australia (CBA) Norfolk Island branch that he held initially in the name “Dr John Walsh of Brannagh”. He upgraded his name on that account to “Dr Sir John Walsh of Brannagh”, as recorded on the statement for the period ended 28 November 2020. The pension payments into the CBA access account varied from between about $2,400 to $2,800 per month during the period between 23 February 2018 and 5 April 2019, then to about $3,400 per month until about 18 October 2019, when they reduced to about $2,000 per month. Ms Butler began receiving a pension payment directly into her bank account from about October 2019. Between 23 February 2018 and 4 October 2019, Mr Walsh transferred fortnightly sums from his CBA smart access account totalling $29,387.59 to a CBA account in Ms Butler’s name. Between 23 February 2018 and 7 December 2020, he transferred fortnightly from his CBA access account a total of $71,586.14 to a CBA account in the name of United Pacific Corporation Pty Ltd. He then caused United Pacific to make payments from its CBA account for his benefit to reduce his debt on the ANZ 4727 card from what he had transferred to it.
United Pacific was incorporated on the Island on 14 January 1994. Mr Walsh held about 62.5 per cent of the issued capital in United Pacific and Ms Butler the balance. Mr Walsh used funds to the credit of the United Pacific account to pay off his debts on his Australia and New Zealand Banking Group Ltd (ANZ) bank rewards travel adventures credit card ending in 4727 (the ANZ 4727 card), and for other occasional expenses, throughout the period between 23 February 2018 and December 2020.
On 1 March 2018, Mr Walsh departed Australia and, according to his incoming traveller card, returned here on 6 March 2018, having spent most time in Japan while overseas for those five days. His statement for his ANZ 4727 card for the period ending 28 March 2018 recorded that he had paid a hotel bill in Tokyo of $1110.18.
On 11 April 2018, he and Ms Butler entered into a contract to sell their home on the Island for a price of $590,000. Mr Walsh appears at that stage to have had no relevantly discernible financial inhibitions. On 12 April 2018, he flew business class from Melbourne to London on Singapore Airlines and returned to Melbourne in business class on 25 April 2018. The Registrar obtained screenshots from the webpage of the ITNJ that indicated that that entity had apparently held “sittings” in Westminster in London between 16 and 18 April 2018 at which the supposedly presiding judge was described as “Chief Justice” and “Sir John Walsh of Brannagh”. That appeared to be a continuation of what Gilmour J found was Mr Walsh’s professional misconduct in making similar false representations.
The statement for the ANZ 4727 card for the period ending 24 May 2018, recorded that, during the preceding month, Mr Walsh had paid ANZ a total of $3,741.20.
At settlement of the contract for sale of his and Ms Butler’s home on 28 May 2018, the proceeds of sale were used to discharge a mortgage to the CBA, Norfolk Island branch, of $132,111.41, and the balance was paid to Ms Butler, pursuant to Mr Walsh’s email to which I referred at [#8] above. It is clear that, at that stage, Mr Walsh had access to sufficient money to pay the debt to Dr Sze, but by then he had chosen not to do so.
The Registrar submits that the above factors, in combination with Mr Walsh’s pattern of spending and conduct after Gilmour J made the orders on 23 February 2018 and 1 March 2018 requiring payment to Dr Sze and the taxed costs, indicated that at all relevant times, Mr Walsh has had the ability to pay Dr Sze and has deliberately chosen not to do so.
I am satisfied beyond reasonable doubt that Mr Walsh had the ability to pay Dr Sze the sum of $433.69 throughout the period between 1 March 2018 to the present time.
Mr Walsh’s failure to pay any of the taxed costs
The Registrar also alleges that, after the taxation of his costs, Mr Walsh also has had the means to pay at least some of those taxed costs, but has chosen not to do so.
Mr Walsh left Australia for Bali on 18 June 2019, returning on 27 June 2019. The Registrar accessed the “Indonesia seatings” link on the ITNJ’s website for 23–24 June 2019, where apparently that entity dealt with the topic of “Weaponization of the Biosphere”. The Registrar gave evidence of a screenshot of a YouTube video embedded in the ITNJ’s webpage that, again, appeared to show Mr Walsh wearing a jacket and jabot with his name prominently displayed at the bottom right-hand corner of the screen as “Sir John Walsh of Brannagh ITNJ Chief Justice”.
On 24 June 2019, while Mr Walsh was in Bali, the Deputy Registrar of the Court issued a certificate of costs assessment pursuant to the orders made by Gilmour J on 23 February 2018, that certified the Registrar’s costs in the amount of $143,775.67.
On 25 June 2019 the solicitors for the Registrar sent the costs certificate to Mr Walsh at both his johnwb.act email address and another email address with a Norfolk Island domain suffix.
In response, on 25 June 2019, Zahra Dixon, styling herself as “Legal Associate to Sir John Walsh of Brannagh”, emailed a secretary in the Registrar’s solicitors’ office, saying:
As you may be aware, Sir John is currently in Indonesia presiding over the International Tribunal for Natural Justice and is out of office, and can not receive mail. We had received the email sent and are unable to open the large attachment due to its size of 7.2MB. We do not know what has been sent, what matter you are referring to and have not received any documentation for reference.
Mr Walsh wanted to make sure that the solicitors for the Registrar received Ms Dixon’s email, which I infer he dictated. That is because he later sent an email to the solicitor for the Registrar from his mobile phone using his own johnwb.act email account, at 5:27pm on 25 June 2019, that contained forwarded further emails from Ms Dixon, including the one just quoted. That demonstrates that Mr Walsh received those emails while in Indonesia, including the one attaching the costs certificate.
I am satisfied beyond reasonable doubt that Mr Walsh had notice of the attachment to the Registrar’s solicitors’ email of 25 June 2019 containing the costs certificate, and that, not later than his return to Australia from Bali on 27 June 2019, he was able to open the attachment containing the costs certificate because it was not a document of any particularly significant size.
Since then, Mr Walsh has still not paid any money either to Dr Sze or to the Registrar in respect of any of the taxed costs for which he was liable.
Mr Walsh’s other financial dealings and the Registrar’s bankruptcy proceeding
From 2016 to the present, Mr Walsh has been in default on accounts for an American Express platinum reserve credit card and an American Express gold card that he had in the name of the Duke de Ronceray, although the account details also used the name Sir John Walsh of Brannagh. Prior to the judgments of Gilmour J, those two cards were inactive and he was in default in respect of over $53,000 in total.
Mr Walsh also had a platinum credit card account with ANZ in the name “Sir John Walsh Brannagh”. In May 2018, that card had a debit balance of $21,871.94, which was about $400 over the limit. He had made a $400 payment to ANZ for that card on 8 May 2018. He continued making relatively small purchases on it until January 2019, and made irregular payments to ANZ on it, sometimes over $1,000 in a month, during that period.
Mr Walsh also had a gold access cheque ANZ account in the ducal name albeit the statements for that account also identified the holder as “Sir John Walsh of Brannagh”. That cheque account appears to have become inactive by May 2018.
Mr Walsh made regular payments of $1074.15 to the Adina Apartment Hotel in Queen Street, Melbourne for what appears to be his weekly accommodation expense using the ANZ 4727 card. Those payments continued until the last one on 5 April 2020.
As at 1 April 2021, the ANZ 4727 account had a debit balance of $2,402.98. Mr Walsh had continued, since March 2018, to use it and make regular payments to reduce its debit balance. The Registrar calculated that, over the period between 1 March 2018 and 7 December 2020, Mr Walsh made regular monthly payments to the ANZ 4727 card totalling $159,709.08 in respect of his expenditures on that account. That approximately matched the amounts he had expended on purchases. It was one credit card account that he wished not to go into default.
On 20 February 2020, the Registrar commenced bankruptcy proceedings against Mr Walsh under the Bankruptcy Act 1966 (Cth) in the Federal Circuit Court.
On 20 July 2020, a judge of the Federal Circuit Court made a sequestration order against the estate of Mr Walsh and ordered that the petitioning creditor’s costs be paid out of the bankrupt’s estate. That Court noted that the act of bankruptcy occurred on 24 January 2020 and that consent of joint trustees to act had been filed with the Court. However, that order does not affect Mr Walsh’s obligations to make payments under the law applicable in the Island. That is because the Bankruptcy Act1966 (Cth) provides in s 9A:
9A Act does not extend to Norfolk Island
This Act does not extend to Norfolk Island.
Mr Walsh’s CBA bank accounts and the CBA account of United Pacific are situated in the Island and, by force of s 9A of the Bankruptcy Act 1966 (Cth), may not be property over which trustees in bankruptcy appointed by the 20 July 2020 orders in the Federal Circuit Court can exercise powers. Bankruptcy on the Island is governed by the Bankruptcy Act 2006 (NI). It is not clear exactly what the bankruptcy trustees have done to control Mr Walsh’s assets or bank accounts, save to say that Mr Walsh seems to have been able to operate freely on the CBA and ANZ accounts in evidence well after he was made bankrupt on mainland Australia. That may be because of the serendipitous confusion which could be caused, perhaps intentionally, by Mr Walsh’s use of various different names to describe himself to financial institutions in the context that the relatively common name, John Walsh, is, without more, unlikely to be connected readily to his more exotic names in which he opened the bank accounts and credit cards. It may also be because those accounts are located in the Island.
Whatever the explanation, I am satisfied beyond reasonable doubt that, in this jurisdiction, namely Norfolk Island, Mr Walsh has had assets over the period between 23 February 2018 and 20 July 2020 with which he could pay readily the $443.69 owed to Dr Sze and could have made some payments to reduce the indebtedness owed to the Registrar under the costs order.
As at 9 December 2020, his CBA account in the name of Dr Sir John Walsh Brannagh had a credit balance of $1,364.90, being an account to which some pension payments have been credited regularly. Mr Walsh appears to have ceased, after 1 December 2020, transferring pension payments to the United Pacific CBA account or using it to make payments to reduce the debt on his ANZ 4727 card. As at 30 March 2021, United Pacific’s Island bank account was over $15,000 in credit and did not appear to have been operated for about three months. There is no more up-to-date information as to it or the other bank accounts in evidence. There is no evidence of any financial institution that Mr Walsh has used since to continue to finance his lifestyle.
Service on Mr Walsh
The Registrar had difficulties serving Mr Walsh with the documents in the present application. On 8 March 2018 Mr Walsh emailed Andrew Keevers, one of the solicitors for the Registrar, stating:
Dear Mr Keevers,
As previously advised your attachments will not open and keep asking for a coded app (whatever that means). You will recall that I complained about your emails previously to the court and you will recall that Justice Gilmour completely ignored what I was saying and ordered me to sit down and keep quiet. All of this should make for interesting reading when the transcript is finally produced but shows the contemptible way your team and the presiding judge treated me and my defence, even to the point of deliberately conducting a trial when I was ill and confined to my room known to the court and your prosecutor.
Yours sincerely, John Walsh of Brannagh
Mr Walsh seemed very adept at being able to use, or obtain assistance in using, including from persons like Ms Dixon, websites and electronic communications to serve his own purposes, yet claimed that he was unable to open emailed documents. As that email suggested, he appears, in his own words, to have engaged in a similar charade before Gilmour J.
In his affidavit of 3 July 2020, a solicitor acting for the Registrar, Tom Hillyard, deposed that he sent a letter to Mr Walsh at his address for service, 205 William Street, Melbourne, being barristers’ chambers, and an email to his email addresses (including the johnwb.act email address) attaching the application filed on 15 May 2020 seeking declarations that he had committed contempt of court, together with Mr Hillyard’s affidavit of 23 April 2020 and Dr Sze’s affidavit of 22 April 2020.
The ANZ 4727 card indicates that Mr Walsh appears to have ceased to reside at the Adina Hotel in about April or May 2020, at the time of a national lockdown due to the COVID-19 pandemic. As appears below at [#53], Mr Walsh confirmed so much in text messages that he exchanged with Mr Hillyard on 25 August 2020 when, characteristically, he appeared to be evading any attempt to acknowledge service or even the existence of this proceeding.
On 19 May 2020, Registrar Cho of the Federal Circuit Court made orders that listed the creditor’s petition for hearing on 7 July 2020 and provided that Mr Walsh could be served with relevant documents in that proceeding by leaving an envelope containing them addressed to him at the Adina Hotel, sending them by prepaid ordinary post addressed to him there, scanning and sending them by email as an attachment to his two email addresses, being the johnwb.act and the Norfolk Island ones, and also to Ms Dixon. In addition, Registrar Cho’s orders also required that Mr Walsh be sent a text or SMS message on his mobile telephone number
I made similar orders for service on 13 July 2020 to those made by Registrar Cho and ordered that the documents would be deemed to have been served on Mr Walsh 14 days after the last event of service to occur, in accordance with those orders.
I am satisfied beyond reasonable doubt by the affidavit of Malcolm Hadji, affirmed 30 July 2020, that on 16 July 2020 he left the application in proceeding filed on 15 May 2020 and the other documents set out in the orders of 13 July 2020 at the Adina Hotel.
In his affidavit of 17 July 2020, Mr Hillyard sought further orders from this Court as to how Mr Walsh should be served in the circumstances of uncertainty as to where he lived because the Adina Hotel had informed a process server that Mr Walsh was no longer staying there when he attempted to serve documents in accordance with the orders made on 13 July 2020.
On 31 July 2020, I granted the Registrar leave to file, by 25 August 2020, an amended application in proceeding giving full particulars of the remedy he sought. I ordered that Mr Walsh be served by scanning and sending the amended application to his johnwb.act email address with a link as an attachment providing access to it and also sending an SMS to him on his mobile phone that stated that the Registrar had filed an application in a proceeding with the Court and that documents had been sent to or left at the Adina Hotel.
I am satisfied beyond reasonable doubt by Mr Hillyard’s evidence that Mr Walsh was served in accordance with the orders made on 31 July 2020. Mr Hillyard sent an email to Mr Walsh on 25 August 2020 at the johnwb.act email address that attached a letter from his firm, the amended application as filed on 24 August 2020 and the order that I made on 31 July 2020. Mr Hillyard also sent an SMS message to Mr Walsh on 25 August 2020. Mr Hillyard’s SMS stated that an amended application in a proceeding had been filed in the Court and that one copy had been sent to the Adina Hotel and another copy emailed to Mr Walsh.
Mr Walsh responded in an SMS to Mr Hillyard’s SMS stating that the Adina Hotel had been closed because of the State of Emergency declaration by the Premier of Victoria, Daniel Andrews, and that “If you have any genuine documents you can serve them on Daniel Andrews”. Mr Hillyard responded soon after on 25 August 2020, thanking Mr Walsh for confirming receipt of his SMS, and said “Please do not hesitate to advise me of an alternate postal address. Otherwise, the documents have been served by email”. Mr Walsh did not reply.
I am satisfied beyond reasonable doubt that, by reason of Mr Walsh’s text messages that he exchanged with Mr Hillyard on 25 August 2020, he was aware that the present application had been filed in this proceeding. That is because the text message gave the proceeding number, being the same one as that in which Gilmour J made the orders of 23 February 2018 and 1 March 2018.
I am also satisfied beyond reasonable doubt by Mr Hillyard’s affidavit of 9 December 2020 that, on 27 November 2020, Mr Hillyard sent another email to Mr Walsh at the johnwb.act address that attached a letter of the same date from his firm, the Registrar’s submissions filed on 26 November 2020, together with a copy of the email that Mr Walsh had sent on 8 March 2018 to the solicitors for the Registrar, the Federal Court of Australia’s National Practitioners/Litigants Guide to Online Hearings and Microsoft Teams, and that Mr Hillyard also sent a text (SMS) message to Mr Walsh. On the same day, Mr Walsh exchanged SMS text messages with Mr Hillyard in which he wrote, among other statements:
I have no idea who you are but it is obvious you are an ignorant person as everyone knows the Adina has been closed by government order and we are in lockdown. Who is this unnamed “applicant” ? and what are these proceedings? This email is being reported to the police and other regulatory authorities.
Mr Hillyard responded, noting Mr Walsh had confirmed his receipt of his earlier text which drew the following response:
Who on Earth are you? You sent an offensive text message which is being reported to the authorities
It is noticed you do not give a real name and a real address. Will leave it up to the police authorities to unearth who and what you are.
Mr Hillyard did not give any evidence about any contact from “police authorities”, despite Mr Walsh’s threats to involve them.
Consideration
The power to punish for contempt is an inherent power of a superior court of record and does not require any specific statutory conferral of such a power. In Grassby v The Queen (1989) 168 CLR 1 at 16–17, Dawson J, with whom Mason CJ, Brennan J, Deane J (with a qualification not relevant for the present purposes) and Toohey J agreed, discussed the nature of inherent jurisdiction of a superior court of record. Dawson J wrote:
In Reg. v, Forbes; Ex parte Bevan [(1972) 127 CLR 1 at 7], Menzies J. pointed out that:
"'Inherent jurisdiction' is the power which a court has simply because it is a court of a particular description. Thus the Courts of Common Law without the aid of any authorizing provision had inherent jurisdiction to prevent abuse of their process and to punish for contempt. Inherent jurisdiction is not something derived by implication from statutory provisions conferring particular jurisdiction; if such a provision is to be considered as conferring more than is actually expressed that further jurisdiction is conferred by implication according to accepted standards of statutory construction and it would be inaccurate to describe it as 'inherent jurisdiction', which, as the name indicates, requires no authorizing provision. Courts of unlimited jurisdiction have 'inherent jurisdiction'."
… it is undoubtedly the general responsibility of a superior court of unlimited jurisdiction for the administration of justice which gives rise to its inherent power. In the discharge of that responsibility it exercises the full plenitude of judicial power. It is in that way that the Supreme Court of New South Wales exercises an inherent jurisdiction. Although conferred by statute, its powers are identified by reference to the unlimited powers of the courts at Westminster….
A superior court, however, not only has power to punish contempt against itself committed out of court, but in the exercise of its inherent jurisdiction it may prevent and punish summarily as a contempt any interference with the due course of justice in an inferior court: see Reg. v. Lefroy [(1873) L.R. 8 Q.B. 134].
(emphasis added)
This Court was constituted as the superior court of record on the Island under s 18(3) of the Norfolk Island Act 1957 (Cth), and has continued in existence since then under s 52(1) of the Norfolk Island Act 1979 (Cth). This Court is a court of the same character as the Supreme Court of New South Wales. Therefore, it has all of the inherent powers of a superior court of record, including the power to punish for contempt.
In Witham v Holloway (1995) 183 CLR 525 at 533, Brennan, Deane, Toohey and Gaudron JJ said:
All orders, whether they be Mareva injunctions, injunctions relating to the subject matter of the suit, or, simply, procedural orders, are made in the interests of justice. Non-compliance necessarily constitutes an interference with the administration of justice even if the position can be remedied as between the parties
(emphasis added)
Their Honours observed that the differences that found the distinction between civil and criminal contempt are illusory in significant respects. They held that because the remedy for both civil and criminal contempt was punishment, the criminal standard of proof should apply in all cases of alleged contempt (183 CLR at 534: see too Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 256 CLR 375 at 388–389 [42]–[43] per French CJ, Kiefel, Bell, Gageler and Keane JJ). They said that (183 CLR at 533):
…proceedings for breach of an order or undertaking have the effect of vindicating judicial authority as well as a remedial or coercive effect… proceedings for breach of an order or undertaking have the effect of vindicating judicial authority as well as a remedial or coercive effect. Indeed, if the person in breach refuses to remedy the position, as is not unknown (See, eg, In re Davies (1888) 21 QBD 236), their only effect will be the vindication of judicial authority.
(emphasis added)
In Australasian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 107, Gibbs CJ, Mason, Wilson and Deane JJ held that the underlying rationale for every exercise of the contempt power is that it is necessary to uphold and protect the effective administration of justice. They illustrated this by citing the following passage from Borrie and Lowe's Law of Contempt, 2nd ed. (1983) at p 3.
If a court lacked the means to enforce its orders, if its orders could be disobeyed with impunity, not only would individual litigants suffer, the whole administration of justice would be brought into disrepute.
Thus, if a person disobeys a court order, the Court must have, and be seen by the community to have, power to punish any such disobedience as a contempt. The exercise of the contempt power in such a situation will vindicate the rule of law through the exercise of judicial power as not only the means that our system of government has selected to determine what the law is and how it is to be applied to a particular factual circumstance, but also to impose punishment for a contravention of the law, including as expressed in the lawful exercise of the Court’s jurisdiction. The role of the Court in our society to administer justice carries with it, necessarily, the concomitant power to ensure that its orders are obeyed and its authority is respected. This ensures that members of society do not take the law into their own hands or see the need to do so, because the Court is not impotent to ensure that its orders are obeyed.
In Kazal v Thunder Studios Inc (California) (2017) 256 FCR 90 at 110–111 [26], Besanko, Wigney and Bromwich JJ identified the following principles relevant to a contempt of the kind here, saying:
In Matthews v Australian Securities and Investments Commission [2009] NSWCA 155 (Matthews) at [16], Tobias JA (and previously the trial judge in that case) reproduced with approval the following passage from MetcashTrading Ltd v Bunn (No 5) [2009] FCA 16 at [9], in which Finn J summarised the applicable principles as follows:
… First, the order alleged to be breached must be clear and unambiguous: see Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483 at 515-516; and be capable of being complied with: see Australian Prudential RegulationAuthority v Siminton (No 7) [2007] FCA 1609 at [40]. Secondly, the proper construction of an order is not a matter of fact but a question of law: UniversalMusic Australia Pty Ltd v Sharman Networks Ltd (2006) 150 FCR 110 at [19]. Thirdly, it is not necessary for an applicant to prove that an alleged contemnor intended to disobey the order: ibid, at [17]; nor is it necessary to prove that the alleged contemnor understood the true meaning of the terms of an order or that he or she was aware that his or her conduct constituted a breach of the order: Microsoft Corporation v Marks (No 1) (1996) 69 FCR 117 at 143. Nonetheless it may be highly relevant to the question of penalty that the alleged contemnor disobeyed an order because he or she placed a construction on it that was not its true construction: Universal Music Australia Pty Ltd at [38]. Fourthly, deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct be casual, accidental or unintentional: Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494 at [6]. Fifthly, the facts in issue in a contempt charge must be proved beyond reasonable doubt: Witham v Holloway (1995) 183 CLR 525 at 534.
(emphasis added)
Accordingly, it is important to determine whether or not the act of the alleged contravener is contumacious or intentional. A mere casual or accidental failure to comply with a Court order is not readily capable of being seen as defiance of the Court’s authority, but a deliberate one is. The Court must be able to vindicate its authority and the status of its orders as requirements that the law has imposed on a person to ensure that the community knows that those orders will be obeyed and, if need be, enforced. No person can seek to avoid or ignore the governmental aspect of a court order that determines that the law requires the person to perform a particular action, such as obeying an injunction or complying with a specific clear order, including an order for the payment of money.
While society has moved well away from having debtors’ prisons, in a case such as the present, it is obvious that Mr Walsh has decided that he will simply ignore or, indeed, flout, what the Court has determined his legal obligations to be; namely, to repay, with interest, the money that he obtained from Dr Sze using false representations and to pay the costs that the Registrar incurred in the proceedings before Gilmour J. Those orders were pellucid and contained no ambiguity.
I am satisfied beyond reasonable doubt that Mr Walsh has deliberately chosen not to pay the relatively insignificant sum of $433.69 to Dr Sze and that by doing so Mr Walsh has refused to recognise the authority of the Court.
Mr Walsh had the means to pay Dr Sze, up to the time of his bankruptcy in Australia. He clearly is not impecunious and has not been so even though he had directed the payment of the net proceeds of the sale of use of his and Ms Butler’s house solely to her. He has continued thereafter to have ample funds located in the Island to make such a payment. He has used moneys available to him in his name or under his control after his Australian bankruptcy as he pleased throughout the period from 1 March 2018 until the documentary trail stops in March 2021. He has decided that he will not pay the judgment debt to Dr Sze despite being well aware of his obligation to do so. Likewise, he has made no effort whatsoever to pay the whole or any part of the costs as taxed.
I am satisfied beyond reasonable doubt that each instance of his conduct in failing to pay, first, Dr Sze or, secondly, since 25 June 2019, the Registrar any part of the $143,775.67 the subject of the certificate of taxation, is a wilful and contumacious defiance of the authority of the Court. His conduct indicates that Mr Walsh regards himself as free to carry on his lifestyle as and when he chooses, and to ignore, entirely, his civil obligations to obey the Court’s orders that he pay $433.69 to Dr Sze and the costs due to the Registrar. That defiance of the Court’s authority in a society governed by the rule of law is unacceptable.
Every citizen must obey the law, including the law as determined by orders of the Court, as the third arm of government. Mr Walsh cannot be allowed continue to ignore the Court’s authority or its orders in the way he has chosen deliberately to do. He has been aware of the Court’s orders and has thumbed his nose at its authority for over three years. It follows that he is guilty of contempt of Court.
Conclusion
I will enter convictions reflecting that Mr Walsh committed contempt of the Court, first, in contravening the order made by Gilmour J on 23 February 2018 that, within 28 days of that order, he reimbursed Dr Sze of the sum of AUD200 with interest payable from 1 July 2007 that the order of 1 March 2018 quantified in the total sum of AUD433.69, and, secondly, in failing to pay the Registrar the whole or any part of the costs of and incidental to the proceeding, such costs to be taxed, if not agreed, which costs were quantified as $143,775.67 on 25 June 2019 and thereafter.
The Registrar submitted that I should adjourn the proceeding to determine penalty later. In my opinion, that is the appropriate course. I will give Mr Walsh one further opportunity to be heard and to purge his contempt, or to establish that there was some matter that does not appear in the evidence to suggest that he is not guilty or would warrant the revisiting these orders made in his absence.
In the meantime, I am of opinion that freezing orders should be applied to Mr Walsh’s bank accounts and other resources to preserve them so as to be capable of being sequestered or applied to satisfy the orders the subject of his contempt. Once his access to money is constrained, he may be motivated to recognise the authority of the Court or accept the consequences of not doing so. The Registrar should prepare a draft freezing order which I will make in chambers.
I certify that the preceding seventy-one (71) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Rares. Associate:
Dated: 23 June 2021
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