Siminton v Tracey & Anor

[2006] HCATrans 593

[2006] HCATrans 593

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M136 of 2006

B e t w e e n -

DAVID SIMINTON

Plaintiff

and

JUSTICE TRACEY

First Defendant

VICTORIAN DISTRICT REGISTRAR OF THE FEDERAL COURT

Second Defendant

Summons

CRENNAN J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 3 NOVEMBER 2006, AT 9.34 AM

Copyright in the High Court of Australia

MR D.B. SHARP:   If the Court pleases, I appear on behalf of the plaintiff.  (instructed by Erhardt & Associates)

MR R.M. NIALL:   May it please your Honour, I appear on behalf of the second defendant, the District Registrar of the Federal Court of Australia.  (instructed by Federal Court of Australia)

HER HONOUR:   Mr Sharp, has there been service in relation to the first defendant?

MR SHARP:   We believe so, your Honour.  There has been some confusion on the question of service, but we believe that, in fact, both the Registrar and Justice Tracey had been served by leaving them at the desk of the Registry.  I believe that that is effective service on the part of Justice Tracey.

HER HONOUR:   Do you have any instructions at all?

MR NIALL:   I do, your Honour, if I could assist your Honour.  Firstly, can I apologise that no appearance has been filed on behalf of the second defendant, and we will attend to that today, if your Honour pleases.  In relation to his Honour Justice Tracey, I am instructed that his Honour will file a submitting appearance in relation to that matter and that again will also be done today, if your Honour pleases.

HER HONOUR:   Yes, thank you, Mr Niall.  That takes care of that, Mr Sharp. 

MR SHARP:   It does, your Honour.  I am indebted to your Honour.  There is one further potential complication and that is this.  We have considered the desirability, at least at the inter partes stage, of causing the material to be filed on APRA.  Your Honour will appreciate that they are formally a party to the principal proceeding, if we can call it that.  Therefore, although they are not named as parties to this High Court proceeding, we served documents upon them as well.  Now, I note, and I had anticipated that they would be here, that there is no one representing APRA.

HER HONOUR:   Yes, very well.  Thank you for informing the Court of that.

MR SHARP:   The matter before you today, your Honour, is an inter partes application for a stay.  There is affidavit material which is on the file, I believe.

HER HONOUR:   Yes, I have read that, Mr Sharp.

MR SHARP:   Then briefly I will just canvass the nature of the material.  There is a supporting affidavit.  There are exhibits to the affidavit.

HER HONOUR:   Yes, I have read those.

MR SHARP:   A number of exhibits, including, if I can just itemise them, exhibit A which is the judgment of his Honour Justice Tracey dated 18 October.  There is exhibit B which is the supporting affidavit of my learned instructor on 14 September 2006 which was the affidavit in support of an application for an extension of time within which to pay the fine.  Now, it was used on two occasions, or it had two uses.  It was used in support of an application to Justice Goldberg who rejected the application.  The matter was argued.  His Honour dismissed or rejected a contention from APRA on that occasion that he had no power to deal with the matter and ruled that he did as a judge in the Full Court and the matter before him was, in fact, entitled in the Full Court proceeding.  That is of some significance. 

We had initially proposed to bring such an application before Justice Tracey sitting as the judge in which the docket of the principal proceeding had been allotted.  However, we were informed by Justice Tracey’s associate – and that is deposed to – that, in fact, the correct procedure, given that the order for the fine had come from a decision of the Full Court entitled in that decision – numbered in that proceeding 376 of 2006, that the correct application should be made to Justice Goldberg – or we were not told the judge, to the Full Court in matter No 376.  In doing so we came before Justice Goldberg.  This affidavit was the affidavit in support of that application.

Justice Goldberg ruled that that was the appropriate procedure.  He heard the matter as a judge of the Full Court entitled in the matter in the Full Court.  He rejected, however, the application because he ruled that the order of the Full Court had set out a procedure to be followed and that procedure for an extension of time stipulated that the application should be made first to the Registrar, and that is an order within the Full Court’s ruling.  Accordingly, we then repaired straight to the Registrar and made application to the Registrar and used this affidavit in support of that application, the same affidavit, exhibit B.

HER HONOUR:   You are still speaking of an application for a stay?

MR SHARP:   Yes.

HER HONOUR:   Of Justice Tracey’s order?

MR SHARP:   No, it was an application for an extension of time on that occasion.

HER HONOUR:   Sorry, yes, I see.

MR SHARP:   We sought an extension of time within which to pay the fine.

HER HONOUR:   Yes.

MR SHARP:   The Registrar then, without further ado, subsequently informed us that such an extension had been granted effectively for approximately two weeks.  The extension of time had been sought to enable the application for leave to appeal the order of Justice Tracey to come before the Federal Court.  In the event, it had not reached the Federal Court by the time that the extension of time had expired.

HER HONOUR:   So are you informing me now that there is an application for leave to appeal the order of Justice Tracey which is on foot before the Full Court?

MR SHARP:   No, not quite, your Honour.  What happened then was that the application for leave to appeal was rejected by the Registry and they did so, as we understand my instructor who has instructed me, that the reason that the Registry rejected the application for leave to appeal was that Justice Goldberg, in his rejection of the stay – no, I am sorry, your Honour, I have confused the two.  We had sought a stay on the 19th before Justice Goldberg.  So there were two appearances before Justice Goldberg and I have confused the first with the second.  On the second appearance ‑ ‑ ‑

HER HONOUR:   Just let me get this clear in my mind.  You sought a stay before Justice Goldberg of the order of Justice Tracey about which you complain in this Court.  Is that correct?

MR SHARP:   Yes, the reasons for judgment were delivered on the 18th and we applied for a stay before Justice Goldberg on the 19th.

HER HONOUR:   Yes.

MR SHARP:   On the 19th Justice Goldberg rejected the application for a stay.  As part of his reasons he ruled that any application for leave to appeal would be out of time.  He relied on the order, 52.10 from memory, which provides that an interlocutory matter which is dealt with by the Court, leave to appeal must be made within seven days.  Now, we argued before Justice Goldberg that we were within time.

HER HONOUR:   Did you seek an extension of time from Justice Goldberg?

MR SHARP:   Not at that stage, your Honour, no, we did not.  We did not seek an extension of time from Justice Goldberg.  We argued to the contrary, that it was not caught by order 52.10 for two reasons.  First of all, it was not an interlocutory proceeding.  The Registrar’s motion, if I can call it that, and by that I mean the motion that the Registrar had brought before Justice Tracey on the 6th, although entitled in 1607 of 2005, the principal proceeding was not an interlocutory order or not an interlocutory proceeding.  It was a matter to do with contempt and it was discrete in itself and was not interlocutory. 

Secondly, we argued that in any event it was within time because the order of Justice Tracey on the 6th had not been completed until he delivered his reasons in court on the 18th.  So for those reasons we said that it was not caught by Order 52.10 and we were within time.  We could file an application for leave to appeal.  However, that was one reason his Honour rejected the application for a stay, but he also ruled that there was no substance in the other arguments which we sought to put before him, or which we put before him.  So he thereupon rejected the application for a stay on 19 October.

Now, we then sought to put in our application for leave to appeal, but this was rejected by the Registry, on my instructions, because of the ruling of Justice Goldberg that we were too late and the Registry took cognisance of this and rejected the application.  On this occasion they said, however, what you need to do is to file an application for leave to appeal out of time.  We took that on board.

HER HONOUR:   The Rules provide for that, do they not?

MR SHARP:   They do, and we were aware of that and we subsequently took two steps.  From memory, the first step was we applied to this Court for prerogative and declaratory relief.  Initially we sought an interim order, an ex parte application for a stay, because of the urgency of the proceeding.  Your Honour will appreciate, to put the matter in context, what Justice Tracey did or ordered over our opposition to this order was that Mr Siminton – I will call him Mr Siminton to avoid the complications of appellant and so forth – should produce documents on 23 October and should subject himself to oral examination on 30 October.

HER HONOUR:   That has arisen, has it not, Mr Sharp?  Mr Siminton has raised the fact that he says he cannot afford to pay the $50,000 fine which has been imposed by the Full Court as an alternative to a period of imprisonment imposed by Justice Merkel.  Is that the sequence of events?

MR SHARP:   Not quite, your Honour.  We had appealed the sentence to the Full Court.  We had appealed both sentence and conviction.

HER HONOUR:   Yes.

MR SHARP:   The Full Court, in effect, allowed the appeal against the sentence but reaffirmed the conviction and rejected the grounds whereby we said that the conviction should not have ‑ ‑ ‑

HER HONOUR:   Imposed a fresh penalty.

MR SHARP:   They substituted for imprisonment a fresh penalty, yes, $50,000. 

HER HONOUR:   Justice Tracey’s orders are made in the context that Mr Siminton says he does not have the means to pay the $50,000.  So Justice Tracey has, within the Rules, made orders and directions in respect of that fact raised by Mr Siminton.

MR SHARP:   One of the bases which we would seek to argue before your Honour is that Justice Tracey had no jurisdiction to do so for two reasons.  Your Honour will have read the material and will appreciate the two reasons we say that he had no jurisdiction to do so.  First of all, we say that the matter was brought by the Registrar in the wrong court and in the wrong proceeding.  Now, we made this objection to Justice Tracey.  Needless to say, Justice Tracey overruled that objection but the basis on which we did so was as follows. 

First of all, Justice Tracey’s associate himself had advised us that we were in the wrong court and in the wrong proceeding when we had intimated that we were proposing to proceed in the principal matter before Justice Tracey and had indicated that we could not do so and had to proceed to the Full Court, in effect, and in the Full Court proceeding.  We had done so.

HER HONOUR:   These would be matters that you would ventilate, I assume, when your application for an extension of time within which to apply for leave to appeal is dealt with.

MR SHARP:   If the same ruling is applicable as has applied to the application for leave, that would be a futile exercise because his Honour Justice Goldberg also ruled that the substance with which we sought to appeal there was none.  In other words, if the Registry is to proceed on the same basis in rejecting our application for leave, it will perforce reject our application for leave to appeal over time because his Honour Justice Goldberg has already indicated that there is no substance in the grounds with which we would seek to rely on.  Therefore, it follows almost as the night the day that our application to the Federal Court for leave to appeal out of time should not be granted.  There would be no point to it.  His Honour Justice Goldberg has already addressed the issues.

We did so perforce because we thought in order to keep faith with the court, if I can put it that way, since we were seeking a stay, there had to be some date within which we could seek to have the stay linked to, and we did.  We asked Justice Tracey, through his associate, we sought the opportunity to appear before him to seek a stay pending the hearing of this application because the sequence was, we came to this Court, we sought interim relief pending the hearing of the full application to show cause why prerogative relief should not be issued, and we then went to the Registry of the Federal Court with the indication that we would seek a stay from Justice Tracey pending the hearing before the High Court, because we could not get before the High Court as a matter of actual practicality.  We could not do so if the Court was not able to provide a Judge or a Judge was not available to hear an interim application.

Justice Tracey, through the Registry office, indicated that he would not grant a stay, he would not grant a stay on that day, but he would grant a stay if APRA and the Registrar agreed, and he would then sign a consent order to that effect.  Now, we then prepared a consent order in those terms and sought the consent of the Registrar and of APRA to such an order.  Now, we spent 24 and 25 October endeavouring to do so.  We did receive an indication through the Registry that the Registrar would agree and a general intimation that if the documents were in order the Registrar would be prepared to agree. 

Now, that was an intimation from the Registry and we submitted on the 25th.  My instructing solicitor attended first the Registry with the intention of going from the Registry to APRA to get a consent from APRA.  On the 25th my instructor attended the Registry office at approximately 10.00 am in the morning with the proposed order.  The Registrar, again through the Registry desk, we were informed, or my instructor was informed, was not available because the Registrar was in a meeting and could not be disturbed at that stage.  At approximately 12.30 pm, my instructor had been waiting, he was informed that the Registrar now had the material and was considering it. 

I can indicate that at that stage I had joined my instructor and at 1.10 approximately we had to indicate to the Registry that in order to obtain the possible consent from APRA that we would have to leave and if the Registrar was going to consent, would they kindly telephone my instructor on his mobile phone.  Now, at approximately 1.45 the Registrar, through the Registry staff, as we understand it, telephoned to indicate that the Registrar was prepared to consent to an adjournment of the oral examination and that the papers to that effect could be picked up, or the order signed by her could be picked up.  My instructor indicated to the caller that he would do so as soon as he delivered the papers to APRA and had sought or obtained APRA’s consent.  APRA indicated when they were approached that the application would be sent to Sydney for its consideration.  My instructor then picked up the consent to an adjournment as initialled by the Registrar. 

HER HONOUR:   Adjournment till when, Mr Sharp?

MR SHARP:   The adjournment to Monday the 6th.  I have neglected to indicate to your Honour that the indication from Justice Tracey had been that he would hear an application for leave to appeal out of time on the 6th.  We had been informed of that.

MR NIALL:   Your Honour, I am sorry to interrupt my learned friend, but perhaps I might seek leave to file in Court an affidavit of the District Registrar which sets out those matters in a very quick way and it might be ‑ ‑ ‑

HER HONOUR:   Do you have a copy for Mr Sharp?

MR NIALL:   I have given a copy of the affidavit ‑ ‑ ‑

MR SHARP:   I received it half an hour ago, your Honour.

MR NIALL:   ‑ ‑ ‑ immediately and together with a very brief outline of submission. 

HER HONOUR:   I will just take a moment to read that, Mr Sharp.

MR SHARP:   Indeed, your Honour.

HER HONOUR:   Yes, I have read that.  Yes, Mr Sharp.

MR SHARP:   If your Honour pleases.  If I can just go back to the 25th, your Honour.  I am explaining this in some detail because it is part of the reason I will be putting to your Honour why this matter should proceed today, the understanding of the time constraints and circumstances.  On the 25th we were therefore unable to obtain APRA’s consent.  APRA, through its legal department, had advised my instructor that they were not in a position to consent on the 25th.  We were therefore under the view on Friday the 25th that on – I apologise, your Honour, I am getting my dates confused and I have no doubt confused the Court completely.  But the Friday was the Friday before – the Monday was the date on which the original order had set for the oral examination.

HER HONOUR:   Yes.

MR SHARP:   So that on the 27th we were under the impression that APRA having not agreed at that stage to the adjournment we would be required to attend on the 30th for the oral examination.  On the morning when we attended the oral examination it was made clear to us that there would be no oral examination that day because there had been, at least on the Registrar’s part, an adjournment to the 6th.

HER HONOUR:   So the oral examination is fixed for 6 November next?

MR SHARP:   No, the oral examination was fixed for 30 October, which was the Monday.  Justice Tracey had intimated that he would hear an application for leave to appeal out of time on the 6th and the adjournment, as we understood it, then was to 6 November.

HER HONOUR:   So the sequence then is that there was an application on foot seeking leave to appeal out of time which will be heard by Justice Tracey on 6 November and on the same day he will also presumably allow to commence the oral examination, subject to any applications that are made?

MR SHARP:   Well, that does not necessarily follow, your Honour, because the oral examination is the Registrar’s responsibility.

HER HONOUR:   Yes, I am sorry.  Yes, of course.

MR SHARP:   What actually has been indicated will happen on the 6th is that his Honour will entertain an application for leave to appeal out of time.

HER HONOUR:   And no applications in relation to the oral examination?

MR SHARP:   No, we do not believe so, your Honour, but there is the distinct possibility ‑ ‑ ‑

HER HONOUR:   What I was hinting at, although I did not articulate it very well, is somehow I had in my mind that there is going to be an application for a stay of the oral examination before Justice Tracey.

MR SHARP:   Yes, there would be.

HER HONOUR:   And that I understood the oral examination was to commence on 6 November subject to any applications made to Justice Tracey in respect of that oral examination before the Registrar.

MR SHARP:   Yes, that is so.

HER HONOUR:   So that is the position.

MR SHARP:   Now, we say that that is a risk which Mr Siminton should not be subject to for a variety of reasons which I will turn to now.

HER HONOUR:   Granting a stay in this Court would only be done in exceptional circumstances.

MR SHARP:   We say that they are exceptional.

HER HONOUR:   The usual prerequisite, or one prerequisite anyway, would be that all steps have been taken in relation to the court seized of a matter before this Court would entertain an application of that kind.

MR SHARP:   We understand that, your Honour, and I would seek to address that aspect.

HER HONOUR:   Very well.

MR SHARP:   First of all, as I have already intimated, we believe that the application would be futile.  We have proceeded with it because the Registry requested that – we understood through my instructor that the Registry requested that we do so.  We also understand that the application, at least presently, has been rejected and needs to be refiled.  Now, undoubtedly it has come before the Federal Court, but we have documents which we were preparing to file today because we understood from the Registry that the actual application had been rejected and was not in proper order or, for whatever reason, had been rejected and would need to be refiled if we were going to go on with it.  We have the documents here ready to refile if that course is required.

So the first thing we say is it is not clear to us that, in fact, the application is actually extant, but for the sake of the argument at least to proceed further we would say, very well, if that is so, that it is before the Federal Court, as now appears to be the position of the Federal Court, then for this point we accept that.  So even accepting that the application is actually extant and before the Registry, we would say it would be futile for the following reason or reasons.  Following the reasoning of the rejection of the application for leave to appeal, the same result should happen to the application for leave to appeal out of time.  Justice Goldberg dealt with ‑ ‑ ‑

HER HONOUR:   Those reasons all depend, do they not, on finding that there is a lack of substance in this application for a stay?

MR SHARP:   Yes, and, in fact, Justice Goldberg ruled that one of the reasons he rejected the application for a stay was that there was no substance in any application leading to an appeal, that an appeal would be futile because there was no substance in the applications.  The application has no substance. 

HER HONOUR:   Can we cut to the chase and you explain to me then, Mr Sharp, what is the substance of the application for a stay in this Court?

MR SHARP:   Yes, your Honour, I could turn to that.  Your Honour should have an outline of reasons or argument.

HER HONOUR:   Argument, yes.

MR SHARP:   Can I take your Honour through that briefly, why we say that there is substance in the application.  There are what I have described as three levels to the ruling of Justice Tracey which we would seek to attack.  The first is the jurisdictional aspect that it was in the wrong court and in the wrong proceeding.  We say that that is overwhelmingly clear and that his Honour had no jurisdiction in that sense to deal with the matter.  It should have been before the Full Court entitled in the Full Court proceeding and formally dealt with by a judge of the Full Court.  We say that is the meaning of the order of the Full Court.  The application for an extension of time is to be referred initially to the Registrar and if directions are required, the Registrar should seek those directions from a judge of the court.  Your Honour will have the ruling or the order in the material supplied.

HER HONOUR:   Now, that is a matter you will agitate on the application seeking leave to appeal out of time, is it not?

MR SHARP:   Yes, it will, but we do not believe, as I have indicated, that any judge who hears the application for leave to appeal out of time would be in a position to overrule the ruling made already to that effect by Justice Goldberg.  To grant leave to appeal out of time, in effect, a single judge of the Federal Court would have to find contrary to the rulings already made by Justice Goldberg.

HER HONOUR:   Because no new material has been put forward?

MR SHARP:   No, no new material.  It is the same material that was argued before Justice Goldberg.

HER HONOUR:   Yes.  So that is the first reason.

MR SHARP:   The first is that the application made by the Registrar is in the wrong court and in the wrong proceedings.

HER HONOUR:   Yes.

MR SHARP:   There is then what I have referred to as the second level of argument and that is this, that even conceding that the matter was entitled and brought by the Registrar in the right court and in the right proceeding, his Honour had no authority to give or make orders to Mr Siminton direct.  What we say the ruling of the Full Court authorised a judge to do was to give directions to the Registrar. 

There is one further aspect, if I can just briefly indicate.  The wrong court wrong proceeding is not just a matter of form, it is a matter of substance, because if the matter is brought before the Full Court, the chain of appeal, if I can refer to it as that, is by application to the High Court direct.  However, if it is entitled in the trial division in the principal proceeding and is heard by a single judge in that jurisdiction, then there is the further step that would have to be taken to appeal Justice Tracey, which is what we are here discussing, would have to go by way of the Full Court.  So we say that it is not just form we are talking about on the first level, it is substance. 

The second level, if I can return to the second level of argument, is this, that his Honour was only empowered by the order of the Full Court to give directions to the Registrar.  We say he could give effectively only two directions.  He could have directed the Registrar to grant an extension of time because that, of course, is what had brought the Registrar to Justice Tracey seeking directions on the application of Mr Siminton for an extension of time.

So one thing that the judge could have directed, we say, is he could have directed the Registrar to grant an extension of time, and that is, of course, what we argued when we argued the matter before Justice Tracey, that the proper direction was grant an extension of time by directing the Registrar to do so.  The second thing we say that he could have done if he was not prepared to grant an extension of time was to direct the Registrar to commence a proceeding in her own name and against Mr Siminton in a new proceeding.  Now, that also is not just a formality.  The effect would be that APRA would not be a party to the proceeding, whereas by bringing it in the principal proceeding, of course, APRA was a named party.

We say that the proper procedure – and this is a matter of some public importance because there is at the moment no clear cut indication as to what is the requisite procedure in matters of contempt where this occurs, where there is follow‑up steps that need to be taken with respect to a conviction for contempt, what is the correct procedure.  The matter has been canvassed by Justice Merkel in a matter who canvassed the law on this situation and found it wanting, if I can describe it as that.  We say that this is a matter of some importance which is appropriate for the High Court as the final arbiter of the common law in Australia ‑ ‑ ‑

HER HONOUR:   The may well be right in due course, but not before the normal appellate processes are exhausted in the Federal Court.

MR SHARP:   Well, we say they might never reach there for this reason – and I am taking a long time to do so, but I will come to it in due course, your Honour, if your Honour will bear with me for a few moments.  We say that on the second level that the only authority that the learned judge had was to grant the order or direct the Registrar to take separate proceedings, and in his judgment Justice Tracey did intimate that he had considered that possibility, directing the Registrar to take further proceedings.  We say therefore that Justice Tracey had no authority to order Mr Siminton to produce documents or to participate in an oral examination.  That was the Registrar’s procedure which should have been ordered or directed.

Thirdly, there are a number of grounds of substance which we set out.  First of all, we say that in a matter of contempt procedure is important, that contempt is clearly a matter akin to criminal proceedings and all of the safeguards and requisites appropriate for a criminal proceeding should attend a contempt proceeding so that matters of form are of significance and importance. 

Secondly, we say that the reason that the extension of time should have been ordered or directed by Justice Tracey was that there was evidence and logic or the reasons and evidence in support of an extension of time were significant.  First of all, the order had imposed a fine of $50,000 to be paid in 60 days – a significant sum, a short period of time.  The evidence is clear that Mr Siminton’s funds and assets have been frozen by a freezing order.  There is, in effect, a total freeze on his assets and funds.

HER HONOUR:   Has any application been made to have the assets unfrozen to the extent of $50,000 for the purpose of paying this fine?

MR SHARP:   Not specifically for the purpose of paying the fine, but we have applied for the release of $200,000 for legal fees.  Now, we have done that through APRA, which is what was directed by the freezing order, that it had to be done through APRA, who would then vet and approve if they did so, or otherwise.

HER HONOUR:   So that is in train, is it, that application for ‑ ‑ ‑

MR SHARP:   No, it has been rejected.

HER HONOUR:   Been rejected.

MR SHARP:   It has been rejected because the order also required an affidavit of means to be supplied to APRA first for them to consider the application.  The rejection was that by failing to supply an affidavit of means with the application there was no basis for proceeding further, and that is consistent with the order. 

Now, this procedure has been one in which Mr Siminton from the beginning has availed himself of the right against self‑incrimination and has consistently done so throughout these proceedings on a number of occasions.  Initially, the ex parte freezing order was issued within ancillary orders.  I have prepared a very basic chronology, your Honour.  It may assist if I were to hand your Honour a copy.  I have already given my learned friend a copy.  It might assist if your Honour were to have that available.

HER HONOUR:   Thank you, Mr Sharp.

MR SHARP:   I do not know if your Honour wishes to peruse it at this stage.

HER HONOUR:   I will take a minute to do so.  Yes, thank you.

MR SHARP:   Your Honour will note that the principal proceeding to a large extent has been a secondary consideration, at least up until now.  The main game, as it were, if I can put it in those words, has been a number of applications for contempt.  By my count there have been effectively four attempts by APRA to proceed against Mr Siminton for contempt, all in the space of a little more than a month, right at the very beginning of the year.  The proceedings that have taken place, as your Honour will appreciate, have to a large extent revolved around contempt and the principal application has been, we would suggest, secondary.  But in the course of the year, or the new year that has expired since this matter commenced, Mr Siminton exercised his right against self‑incrimination before Justice Gray on the return of the order made by Justice Sundberg, an ex parte freezing order, which had first been granted with ancillary orders, production of documents and information to be supplied.

One of the bases for initially proceeding with contempt procedures was that he had not complied with that, but Mr Siminton indicated that he was relying on his right against self‑incrimination and Justice Gray did not proceed further with the ancillary orders.  In other words, when the inter partes freezing order was made it did not include, as it had originally before Justice Sundberg when Justice Sundberg delivered the original freezing order, it was ex parte, inter partes the ancillary orders were not part of the order.  So it was simply a freezing order with no requirements for the supplying of documents and information.

HER HONOUR:   Presumably the same point can be made before Justice Tracey in terms of the applications being made before him on Monday.

MR SHARP:   Well, it has already been made and rejected, your Honour.

HER HONOUR:   You mean it was made before Justice Goldberg and been rejected?

MR SHARP:   No, it was also made before Justice Tracey as part of our objections to the orders that were being proposed to be made.

HER HONOUR:   As part of the argument before he made the orders of which you now complain?

MR SHARP:   Yes.  We say that it would completely, in effect, vitiate his right against self‑incrimination.  It is an end run around the objection.  It would mean that all of the material which has been sought as part of the principal proceeding to enable the principal proceeding to proceed, we say, will be canvassed in the oral examination.  It is the very material with which the principal proceeding is concerned and which APRA has been endeavouring, we say, to obtain. 

What Mr Siminton is alleged to have done in the principal proceeding is engaged in the practice of banking.  Now, of course, part of any oral examination will be, “What is your occupation and what do you do and what have you done?”, and this is the very essence of the principal proceeding.  In fact, we say it is more than just the essence of the principal proceeding because APRA has already conceded in the course of the conduct of the matter so far up until the last proceeding that they have no evidence of lending. 

Now, that was announced right at the very beginning of the proceeding, that therefore there was no evidence of the conduct of a bank because part of the judicial determination of the meaning of banking as set out in the Constitution and consistently been applied by the High Court is that is consists of two arms or two stages.

HER HONOUR:   Just pausing for a moment.  The focus here is in relation to jurisdictional error made by Justice Tracey.

MR SHARP:   Yes.

HER HONOUR:   That is the point of your application, which in due course in the normal course would be remitted to be heard by the Full Court of the Federal Court.

MR SHARP:   Yes, your Honour.  We say that it should not be on this occasion for a number of reasons.  We say that this is a matter which is of public importance and it deserves and requires the imprimatur ‑ ‑ ‑

HER HONOUR:   That is not a matter being heard today.

MR SHARP:   No.

HER HONOUR:   The remitter is for another day.

MR SHARP:   Yes.

HER HONOUR:   Today, as I understand it, is just this urgent application for a stay where I would be expecting you to tell me not so much about the merits of the principal proceeding but to be telling me why it is that a stay is necessary.

MR SHARP:   Very well, your Honour, I will cut to the quick, as your Honour has used that phrase.  We anticipate that if the matter goes before Justice Tracey on Monday, based on the material that I have already canvassed, the application will be rejected.

HER HONOUR:   That is not a reason for applying for a stay in this Court though, Mr Sharp.

MR SHARP:   Well, we say that it should be an aspect to be considered given the rulings that have already been made.  The rulings that have already been made is that we cannot file a normal application for leave to appeal because of the ruling of Justice Goldberg and Justice Goldberg’s ruling, if it precludes a ruling of application for leave to appeal and because his ruling includes a ruling as to the lack of substance of the application insofar as an appeal would be concerned, it is equally applicable to an application for leave to appeal out of time.  The same reasoning would be equally applicable and, with respect, we would not be able to quibble on that.

HER HONOUR:   Is the substance you want to put forward today different from the substance you put before Justice Goldberg?

MR SHARP:   No, your Honour, it is the same arguments but we say that his Honour Justice Goldberg, with respect, erred.  We say there are numerous reasons which would justify – and I was going through them at this stage, your Honour.  There are a number of other reasons why we say that the order should not have been made certainly at that stage – or we say at all, but certainly at that stage.  What we fear, and we say with some justification, is this, that if on the 6th the matter is rejected, as we say on reason and precedents is likely to be, we are engaging in a futile exercise, but not only that, that the consequences that flow from that is that there would then be no legal justification for the order not to be carried out forthwith.

HER HONOUR:   If Justice Tracey refuses the stay application, you have the normal appellate processes in the Federal Court to be pursued, have you not, Mr Sharp?

MR SHARP:   But we would have to have a stay.

HER HONOUR:   Or you have the option of attending for the oral examination before the Registrar and maintaining the privilege of self‑incrimination if that is the course you seek to take.

MR SHARP:   We do, your Honour, but we say that if we attend before the Registrar as a quasi‑judicial proceeding then section 128 of the Evidence Act will kick in.  Now, that is some protection but is not the same protection that the common law right against self‑incrimination imposes.  The Evidence Act, section 128, as it seems to have been interpreted, suggests that it does not act for out of court proceedings.  In other words, section 128, as we understand it, is not applicable other than in judicial or quasi‑judicial proceedings. 

Now, the Registrar would be, we think, or would argue – we would argue to the contrary – but the Registrar, we think, would be minded to argue that this was a quasi‑judicial proceeding and therefore section 128 would apply, and that is of only limited protection.  It limits the protection, but it does not do away with it, but it limits.  But that is in itself a regressive step insofar as Mr Siminton is concerned.  It is not full protection any longer; it is a qualified protection that section 128 provides, with considerable argument.

If his Honour Justice Tracey refuses a stay to enable us to come back at an appropriate time to the High Court – and at least we say that is a possibility, a distinct possibility, that his Honour having ruled against a stay already would follow his previous indication, would not grant a stay and that the order would then be directed to be carried out effectively forthwith – we would have to comply, of course, and we would then be in a position, as I have said, of appearing before the Registrar seeking to rely on the right against self‑incrimination, subject to the Registrar’s determination of section 128 and we would not, given the practicalities, be able to ensure that we would be able to come back before the High Court to seek a stay as we are seeking here today.

So we are seeking the stay today perhaps in an anticipation but nonetheless, we say, a justifiable anticipation because the High Court, although we understand your Honour is sitting in the original jurisdiction might not necessarily be available before the oral examination is ordered to be carried out.  Therefore, we say that it is justified, since we are here today, in seeking that order. 

Now, there is another basis, we say, that we should not have to go through all of these proceedings.  Mr Siminton is subject to a freezing order.  Now, he has been conducting his defence against the principal proceeding and all of the ancillary matters that have arisen with respect to it on very limited resources, extremely limited resources.

HER HONOUR:   But that is in his own hands, Mr Sharp, is it not?  If he is prepared to file an affidavit of means, there is the prospect that moneys will be released for the conduct of the legal proceedings.  Is that not the position?

MR SHARP:   That is the effect of the order.  The possibility arises ‑ ‑ ‑

HER HONOUR:   But Mr Siminton, I assume, does not wish to file an affidavit of means.

MR SHARP:   For, we would submit, manifest reasons.  If there is an affidavit of means ordered, APRA in the normal course of events would be entitled to cross‑examine him on that affidavit.  Now, that, we say, is the very purpose of the exercise insofar as APRA has been endeavouring to ascertain from Mr Siminton information, evidence that it has not got.  Now, it may be that – and I am here to say there is evidence there, but there is the risk of Mr Siminton incriminating himself or providing material that would justify a criminal proceeding because it has been alleged against him that he has committed an indictable offence and a secondary offence in the very civil proceeding which we are primarily or nominally primarily concerned with.

In the statement of claim of the principal application it is alleged that Mr Siminton has committed a breach of section 7, which is the indictable offence of engaging in banking business without a proper authority or without the appropriate licence or consent, and that is an indictable offence, and it is alleged, despite the fact that APRA has already conceded they have no evidence of that offence having been committed.  The very essence, we say, of these proceedings is to endeavour to obtain the evidence that is missing. 

Now, I should add this one further qualification.  After we have been endeavouring to obtain particulars of the statement of claim and information about it for 10 months, APRA, through its counsel, on the last occasion intimated to Justice Weinberg – and I will come to that aspect in a second – that APRA now had or had evidence of lending now, because they have already previously intimated to the court that they did not.  So they now say they have evidence of lending.  We have asked for it, we have not been supplied with it as yet.  But the appearance before Justice Weinberg was an application by Mr Siminton to strike out the application, to dismiss or permanently stay as an abuse of process and, we say, unconstitutional ‑ ‑ ‑

HER HONOUR:   Yes, I have read that judgment of Justice Weinberg.

MR SHARP:   Very well, your Honour.  Then your Honour will be aware that we are proposing to seek leave from the High Court, your Honour’s Court, to appeal that and we are in the process of preparing the appropriate application for leave documents.  Now, we say that if that matter is set aside the whole oral examination and so forth ‑ ‑ ‑

HER HONOUR:   What do the Federal Court Rules say about the route of appeal in relation to that decision of Justice Weinberg’s?

MR SHARP:   We say that since leave to appeal was denied us, we are entitled to appeal that to the High Court.  We cannot proceed with an appeal to the Full Court because leave has been denied us.  Justice Weinberg was sitting on an application for leave to appeal.  Now, we say the proper interpretation of ‑ ‑ ‑

HER HONOUR:   In respect of an interlocutory matter?

MR SHARP:   If it is an interlocutory matter, yes, but we say that the effect is that there is no way we can go through the door to the Full Court when application for leave to appeal has been denied.  We say that the only remedy is to seek relief from the High Court.  We say that is appropriate because this is a matter we say is destined one way or the other to end up in this Court.  If we were to succeed, we believe that almost certainly APRA would wish to apply to the High Court and we believe that we have no other option but that this matter – the law being in the state that it is, it is desirable that the High Court should now provide the guidance in this area which we say is not present at the moment. 

The High Court as the final arbiter of the common law and of statute law and of constitutional law, because it involves the Constitution, we say that this aspect very much involves the question of the Constitution. So it is properly and, we say, would be properly determinable by the High Court and for the public interest should be looked at by the High Court. The High Court should entertain an application for leave to appeal because the matter is of significance and of public importance.

HER HONOUR:   In any event, that is not a matter for me today.

MR SHARP:   No, it is not, your Honour.  Why we say that your Honour should deal with it now is because of the futility of the exercise on Monday, the risk that we would be left without an effective remedy if your Honour did not entertain the application.  We say your Honour is justified in doing so.  The cost, we say that although your Honour is correct he could apply with an affidavit of means for funds to be released, that would be self‑defeating because APRA would be entitled, we would say, in the normal order of events to insist on cross‑examining Mr Siminton on his affidavit of means and would effectively obtain what has been denied it by his exercise of the right against self‑incrimination.  That would be – I am seeking for an appropriate phrase – but it would vitiate the effect of the exercising a right against self‑incrimination.

HER HONOUR:   You have not made, I take it, an application to a judge to deal with these issues, that is to say for a variation of the freezing order on the basis that your material is subject to some sort of confidential directions?

MR SHARP:   Not specifically.  We have applied for the freezing order to be in general terms set aside or varied.  We did apply to Justice Merkel some time ago back in March that the freezing order should be set aside.  Inherent in that application was that it should be at least varied to enable some relief or some means to Mr Siminton to conduct the procedure.  It was open, we say, in the application before Justice Merkel, which did not specifically – and I did the application – from memory, canvassing that particular aspect, but in general terms it did.

HER HONOUR:   One simple course, I suppose, Mr Sharp, might be to apply to a judge to vary the freezing order for the limited purpose of obtaining the $50,000 for the payment of the fine that has been imposed.

MR SHARP:   Yes, there is this aspect.  We understand there is more than $1 million now being held.

HER HONOUR:   Which is subject to the freezing order?

MR SHARP:   We believe so, because we have not been supplied – we have asked APRA for details of how much is being held, but the money is not provided by Mr Siminton.  The money comes in from external sources into the accounts which are frozen.  There has been no admission that ‑ ‑ ‑

HER HONOUR:   Does Mr Siminton have money that is subject of the freezing order?

MR SHARP:   Mr Siminton’s assets and funds have been frozen.

HER HONOUR:   In other words, there are assets in his name which might be subject of an unfreezing order to the extent of the $50,000 fine?

MR SHARP:   There is nothing formally in Mr Siminton’s name that has been frozen, we can indicate to your Honour.  The funds that have been frozen are in two bank accounts, but the effect of the order on Mr Siminton is that he cannot use any assets or funds that he has to do it.  We say the $1 million is in the names of – have been directed specifically in the freezing order, Terra Nova Cache, which is submitted to be a business name of Mr Siminton, which has not been acknowledged or conceded.

HER HONOUR:   So there is no freezing order against Mr Siminton’s personal assets?

MR SHARP:   There is, but we are not saying that the actual funds that are frozen are in his name.  They are in the names of other parties which are also being frozen.  We would say third persons but ‑ ‑ ‑

HER HONOUR:   Business names or company ‑ ‑ ‑

MR SHARP:   Well, APRA would allege business names.

HER HONOUR:   Just let me try to get to the bottom of this.  Are there personal funds of Mr Siminton’s which are the subject of the freezing order which might be the subject of a variation for the purposes of paying the $50,000 fine?

MR SHARP:   There are no identifiable funds of Mr Siminton, we understand, being held frozen.  The funds that are being frozen are in bank accounts or in accounts – not even bank accounts but in accounts ‑ ‑ ‑

HER HONOUR:   But accounts not in his personal name?

MR SHARP:   Not in his personal name.

HER HONOUR:   Very well.

MR SHARP:   They are in the name of Terra Nova Cache and possibly in the name of the Principality of Campside, but they are not directly in his name.

HER HONOUR:   Very well.

MR SHARP:   What is alleged by APRA, as we understand it, is that he is, in effect, using those names as substitute names for himself.  Now, we do not concede that, but what we do say is this.  There is the possibility of those funds being used to pay his legal fees and pay his fine but that would require – inherent in what we are saying is that this is the authorisation of third persons.  We do not concede that they are his funds per se.

HER HONOUR:   Yes, I follow that.

MR SHARP:   So what we say is that on the question of ability to pay is that, yes, we have applied for a release, yes, if those funds were released there is, we believe, the likelihood that the fine would be paid, but not necessarily by Mr Siminton, and that his legal fees would be paid, again, not necessarily by Mr Siminton.

HER HONOUR:   Yes.

MR SHARP:   The real risk, your Honour, is that we would be then subjected in the ordinary course of the proceedings, if Justice Tracey were to dismiss, as we say most likely will occur, any application made to him on Monday for leave to appeal, that before the matter could be brought back effectively to achieve a stay which we say is justified and proper and in accordance with the material that we have placed before your Honour and would seek, if necessary, to elaborate further, that the effect would be we would be subject to a risk without remedy.  We would be subject to the risk of being compelled to take part in an oral examination before we could seek effective relief through the High Court. 

We say that the likelihood is that Justice Tracey, as he has already indicated, would not grant a stay of his order to enable us to come effectively back to the High Court and, therefore, the procedures would be rendered nugatory.  The real process whereby we could effectively appeal his Honour’s ruling would be nugatory.  His denial of leave to appeal to the Full Court would render an appeal to the Full Federal Court nugatory and effectively would, if we were forced to participate within the immediate denial of the rights and in the stay, the right of our application for leave to

appeal out of time and a stay – any effective right to appeal to this Court would also be rendered nugatory. 

If your Honour was not prepared to hear this matter today, we would seek an interim order, and I know that the same would not necessarily be inter partes because APRA is not here, but your Honour has, we say, the capacity to make an interim order which, we would submit, would be appropriate pending the determination of Monday’s application.  That would at least obviate the real risk of any relief being denied any procedure of appeal being rendered nugatory. 

We would, of course, invite your Honour to make an absolute order, but at least we would ask, if your Honour was not prepared to make an absolute order, given the practicalities of the matter, the real circumstances, we would ask your Honour to make at least an interim order and adjourn the further hearing of this inter partes application.

HER HONOUR:   Have you said everything you want to say in relation to the substance of the application for the stay?

MR SHARP:   Yes, your Honour, I believe so, unless your Honour has any further questions.

HER HONOUR:   No, thank you, Mr Sharp.  Yes, Mr Niall.

MR NIALL:   Your Honour, I rely on the written outline which I handed to your Honour.

HER HONOUR:   Yes, I will just read that.  I have not had a chance to do that.

MR NIALL:   If your Honour pleases.

HER HONOUR:   Yes, I have seen that.

MR NIALL:   Your Honour, can I just add one point in relation to paragraph 7(a), that is this.  The order made by Justice Tracey was interlocutory and therefore his Honour has the power also to vary or set aside that order, even outside of the appellate process, under Order 37 rule 7 of the Federal Court Rules.  So there would be an additional basis upon which the plaintiff could put to Justice Tracey a basis for a variation or setting aside of his Honour’s orders of 6 October and that provides another reason, in my submission, why the ordinary course in the Federal Court should naturally see itself to conclusion and then appropriate steps can be taken, if need be, to extend beyond that, but there is absolutely no reason to jump ahead of that orderly process of litigation and the submission that we are going to lose in the Full Court could never be a basis for coming to this Court without going through that intermediate step.  The only other additional matter, if I may ‑ ‑ ‑

HER HONOUR:   What do you say about Mr Sharp’s point about the privilege against self‑incrimination, that somehow that justifies a pre‑emptive strike, if you like?

MR NIALL:   There are two answers to that, your Honour.  The first is that if the plaintiff has a privilege against self‑incrimination, he can claim it and a ruling can be made on it by the Registrar and, again, appropriate appellate procedures can be taken from that ruling, and that is the complete answer.  If he has a privilege, it will be preserved. 

In any event, that issue was one which my learned friend contends was put to Justice Tracey and his Honour’s dealing with it does not evince any jurisdictional error on his Honour’s part, and that is the last point I wish to address your Honour on, which is set out in paragraph 7(b), which is that none of the grounds articulated in either the application or the submission identify any jurisdictional error on the part of Justice Tracey.  They simply allege errors which would be plainly within jurisdiction by a judge of a superior court which was to make an order on the motion giving a direction.  No intelligible ground of jurisdictional error has been pointed to which would justify the exceptional course of staying the order and there is no prejudice because his Honour Justice Tracey will deal with these matters on their merits on Monday and there is no reason for this Court to be involved in the interlocutory skirmishes in this proceeding in the Federal Court. 

Your Honour did ask my learned friend a question about whether an appeal lay to this Court from the judgment of Justice Weinberg, and I know it is not something that will detain your Honour today, but section 33 of the Federal Court of Australia Act precludes an appeal to the High Court from an order of a single judge of the Federal Court other than an appeal from a Federal Magistrates Court.

HER HONOUR:   Yes, I thought there was a rule to that effect.

MR NIALL:   So the evident point is that you have to ‑ ‑ ‑

HER HONOUR:   It is the end of the road in relation to interlocutory matters.

MR NIALL:   To go to the Federal Court?

HER HONOUR:   Yes.

MR NIALL:   No, with respect, sorry, your Honour.  An interlocutory order could be the subject of leave to appeal to the Full Court and from there, the Full Court, you could seek special leave to the High Court, but you cannot appeal directly to this Court through special leave a judgment of a single judge of the Federal Court that has not gone to a Full Court constituted by more then one judge other than those cases with which your Honour would be familiar of appeals from the Federal Magistrates Court.

HER HONOUR:   Yes.

MR NIALL:   But, again, that is not something that need detain your Honour today.

HER HONOUR:   Today, no.  Thank you. 

MR NIALL:   Unless there is anything further, your Honour, they are the only submissions I seek to ‑ ‑ ‑

HER HONOUR:   No.  I think I will stand the matter down till 11.30.

MR NIALL:   If your Honour pleases.

AT 10.48 AM SHORT ADJOURNMENT

UPON RESUMING AT 11.37 AM:

HER HONOUR:   The order in this matter will be:

1.The plaintiff’s summons of 30 October 2006 be dismissed; and

2.        The plaintiff to pay the second defendant’s costs.

I publish my reasons.  Adjourn the Court.

AT 11.37 AM THE MATTER WAS CONCLUDED