Sims v Suda Ltd (No.4)
[2016] FCCA 3338
•21 December 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SIMS v SUDA LTD (No.4) | [2016] FCCA 3338 |
| Catchwords: PRACTICE AND PROCEDURE – Adjournment sought on basis of earlier interlocutory judgment re discovery – factors for consideration on adjournment application. |
| Legislation: Bankruptcy Act 1966 (Cth), s.52 |
| Cases cited: Aon Risk Services Australia Limited v Australian National University [2009] HCA 27; (2009) 239 CLR 175; (2009) 83 ALJR 951; (2009) 258 ALR 14 |
| Applicant: | DOUGLAS ARTHUR SIMS |
| Respondent: | SUDA LTD |
| File Number: | PEG 448 of 2016 |
| Judgment of: | Judge Lucev |
| Hearing date: | 1 December 2016 |
| Date of Last Submission: | 1 December 2016 |
| Delivered at: | Perth |
| Delivered on: | 21 December 2016 |
REPRESENTATION
| For the Applicant: | In person |
| Counsel for the Respondent: | Mr M A MacLennan |
| Solicitors for the Respondent: | Bennett+Co |
| For the Trustee in Bankruptcy: | Mr G B Dudley (the Trustee in Bankruptcy) |
ORDERS (made on 1 December 2016)
That the applicant’s application in a case for an adjournment be dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PERTH |
PEG 448 of 2016
| DOUGLAS ARTHUR SIMS |
Applicant
And
| SUDA LTD |
Respondent
REASONS FOR JUDGMENT
Adjournment application
On 29 November 2016, Mr Sims filed an application in a case for an adjournment of his application for review of a decision of a Registrar of this Court to issue a sequestration order against Mr Sims’s estate. The adjournment application was opposed by the respondent, Suda Ltd. At hearing the Court dismissed the adjournment application and indicated that its Reasons for Judgment would be set out in a written judgment in due course. Ordinarily, it might be unnecessary to set out reasons for refusing an adjournment in a written judgment, but the Court, given the litigation history between these parties, both in this Court and elsewhere, considered it prudent to do so. These are those Reasons for Judgment.
The basis on which the adjournment was sought was that Mr Sims has applied for leave to appeal this Court’s judgment in Suda Ltd (No. 2) [2016] FCCA 2781 (“Sims (No. 2)”) in which Mr Sims sought discovery of certain documents for the purposes of his application for review (which has since been decided by this Court dismissing the application for review: Sims v Suda Ltd (No. 3) [2016] FCCA 3302). The Court took the view that the documents sought to be discovered by Mr Sims were not relevant to the application or review which involved a costs order arising from the Federal Court striking out pleadings by Mr Sims and summarily dismissing an application by Mr Sims and ordering that he pay Suda Ltd’s costs on an indemnity basis: see the Federal Court judgments referred to in Sims (No. 2) at [4] per Judge Lucev, and the determination of this Court that the documents sought were not relevant at [9] in Sims (No. 2) per Judge Lucev.
In Sims (No. 2) the Court held that the documents sought in the application in a case did nothing to prove how Suda Ltd funded the litigation before the Federal Court which gave rise to the costs order, it being Mr Sims’ case that the litigation giving rise to the costs order was funded by Suda Ltd by fraud or the proceeds of crime: Sims (No. 2) at [6] per Judge Lucev. In dismissing the application in a case for discovery the Court had regard to:
a)the matters concerning which the Court had to be satisfied to set aside a sequestration order under s.52(2) of the Bankruptcy Act 1966 (Cth);
b)that the debt related to proceedings in the Federal Court which were struck out as disclosing no reasonable prospect of success, and how those proceedings were funded was irrelevant to the fact that the Federal Court found that the proceedings had no reasonable prospect of success and awarded costs against Mr Sims;
c)that the documents were therefore not relevant to the application for review which sought review of the sequestration order issued by Registrar; and
d)the objects of this Court and the provisions relating to discovery: Federal Circuit Court of Australia Act 1999 (Cth) (“FCCA Act”), s.45, which provide that there must be a declaration that discovery is in the interests of the administration of justice and that an order for discovery would be likely to contribute to the fair and expeditious conduct of the proceedings, matters about which the Court was not ultimately satisfied,
and as to which see Sims (No. 2) at [7]-[11] per Judge Lucev.
On the adjournment application Mr Sims submitted that because his application for leave to appeal the judgment in Sims (No. 2) had not been heard, that the application for review ought to be adjourned until the Federal Court had dealt with his application for leave to appeal.
Adjournment – factors for consideration
Any application for adjournment must be considered in the relevant statutory, factual and case management context. The role and mode of operation of this Court as set out in the FCCA Act and the Federal Circuit Court Rules 2001 (Cth) (“FCC Rules”), and as prescribed by the objects in ss.3 and 42 of the FCCA Act, and the objects in r.1.03 of the FCC Rules, provide for the Court to operate in a manner:
a)as informal as possible in the exercise of judicial power;
b)which is not protracted in its proceedings;
c)which resolves proceedings justly, efficiently and economically;
d)which uses streamlined procedures; and
e)that avoids undue delay, expense and technicality.
Goodall v Nationwide News Pty Ltd [2007] FMCA 218 at [21] per Lucev FM, followed in The Director of the Fair Work Building Industry Inspectorate v Linkhill Pty Ltd (No. 3) [2013] FMCA 165 at [30]-[31] per O’Sullivan FM.
The Court must also take into account the following principles when determining whether or not to grant leave to allow an adjournment:
a)that the paramount consideration remains the doing of justice between the parties, but that a just resolution must have regard to any relevant legislative purpose or object;
b)modern principles of case management;
c)the avoidance of undue delay; and
d)the wastage of public resources.
Aon Risk Services Australia Limited v Australian National University [2009] HCA 27; (2009) 239 CLR 175; (2009) 83 ALJR 951; (2009) 258 ALR 14 at [30] per French CJ and [97]-[103] per Gummow, Hayne, Crennan, Kiefel and Bell JJ; Fair Work Ombudsman v Kentwood Industries Pty Ltd [2010] FCA 98 at [2] per McKerracher J.
In this case, in the context of it being a bankruptcy proceeding, regard must also be had to the public interest, and the interests of creditors other than the petitioning creditor Suda Ltd: Re Svir; Ex parte Commissioner of Taxation (1998) 83 FCR 314; (1998) 39 ATR 113; (1998) 154 ALR 710; FCR at 317 per Burchett J.
Having regard to the basis upon which the adjournment was sought, the Court determined not to grant the adjournment because:
a)the likelihood of an appeal against Sims (No. 2) ultimately being successful was minimal, particularly given that Mr Sims needs leave to appeal the judgment in Sims(No. 2) which was interlocutory: Federal Court Act 1976 (Cth) (“FC Act”), s.24(1A), and needed to demonstrate that the judgment in Sims (No. 2) was attended by sufficient doubt to warrant it being reconsidered, and whether substantial injustice would result if leave were refused supposing the judgment in Sims (No. 2) to be wrong, and that each of those tests had to be made out, that is the tests are cumulative, recognising of course that the Federal Court ultimately has an unfettered discretion under s.24(1A) of the FC Act: Nyoni v Chee Koon Hee(No. 2) [2014] FCA 83 at [34] per McKerracher J;
b)granting an adjournment would, because of the caseload in the Perth Registry of this Court, result in a very significant delay in the hearing of the application for review (which because it involves a creditors petition is time critical); and
c)it was readily apparent on the face of the application for review that the application for review had no reasonable, or no reasonable prospect, of success,
and by reason of both the delay, and the fact that the application for review had no, or no reasonable, reasonable prospect of success, there would be significant prejudice to:
i)Suda Ltd, the petitioning creditor; and
ii)other outstanding creditors, of whom there were at least eleven (other than Suda Ltd), and in respect of whom debts of $296,945.51 had been quantified, together with other debts (primarily costs in court proceedings) as yet unquantified.
In noting the delay referred to above, the Court also notes that Mr Sims’ bankruptcy proceedings have already been protracted: in general terms the evidence on the application for review shows that the Bankruptcy Notice was served on 1 September 2015, and the date for compliance with the Bankruptcy Notice was 22 September 2015, and that as a consequence of various proceedings in this Court and the Federal Court a sequestration order did not issue until 19 September 2016. Further delay would therefore further protract these proceedings contrary to the objects of the FCCA Act and FCC Rules.
Bearing in mind the above matters, and also bearing in mind the totality of the statutory objectives applying to this Court, and having regard to the nature and role of the Court as a first instance federal trial court, the Court also took the view that the interests of justice and case management did not favour the grant of the adjournment.
For the above reasons the Court concluded that it should refuse Mr Sims’ application for adjournment, and ordered accordingly.
I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Judge Antoni Lucev
Date: 21 December 2016
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