Sommer v C Pty Ltd (No.5)

Case •

[2020] FCCA 2792

•

14 October 2020

FEDERAL CIRCUIT COURT OF AUSTRALIA

SOMMER v C PTY LTD (No.5) [2020] FCCA 2792
Catchwords:
BANKRUPTCY – PRACTICE AND PROCEDURE – Application for recusal – whether judge rendered assistance to an unrepresented litigant beyond that which is permitted – whether because judge gave an interlocutory judgment on jurisdiction and other matters a fair-minded lay observer might reasonably apprehend the judge might not determine impartially questions of jurisdiction the first respondent has raised – application for recusal dismissed.

Legislation:

Supreme Court Act 1970 (NSW), s.69

Cases cited:

Cheung v Burness (Trustee) [2016] FCA 1381

Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337

FKP17 & Ors v Minister for Immigration & Anor [2018] FCCA 2053

Flightdeck Geelong Pty Ltd v All Options Pty Ltd [2020] FCAFC 138

Neil v Nott (1994) 68 ALJR 509

Obrart v Grego [2017] FCCA 929

Olivieri v Stafford (1989) 91 ALR 91

Re Riviere; Ex parte Original Mont de Piete Ltd [1919] NSWStRp 56; (1919) 20 SR (NSW) 77

Re Vernon Arnfield [1925] NSWStRp 63; (1925) 25 SR (NSW) 517

Sommer v C Pty Ltd [2020] FCCA 1412

Sommer v C Pty Ltd(No.2) [2020] FCCA 1898

Sommer v C Pty Ltd(No.3) [2020] FCCA 2156

Sommer v C Pty Ltd (No.4) [2020] FCCA 2589

Vakauta v Kelly [1989] HCA 44; (1989) 167 CLR 568

Wilkinson v Osborne & Anor [1915] HCA 92; (1915) 21 CLR 89

Wren v Mahony [1972] HCA 5; (1972) 126 CLR 212
Applicant: MS SOMMER
First Respondent: C PTY LTD
Second Respondent: MS M, IN HER CAPACITY AS A COSTS ASSESSOR
File Number: SYG 697 of 2020
Judgment of: Judge Manousaridis
Hearing date: 12 October 2020
Date of Last Submission: 12 October 2020
Delivered at: Sydney
Delivered on: 14 October 2020
Orders Pronounced: 13 October 2020

REPRESENTATION

Applicant in person, by video
Counsel for the First Respondent:  Mr D Williams SC and Ms M Castle, by video
Solicitors for the First Respondent: ICL Lawyers
No appearance by or on behalf of the second respondent

ORDERS

  1. The application that Judge Manousaridis be recused on the ground of reasonable apprehension of bias is dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Sommer & C Pty Ltd (No.5) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 697 of 2020

MS SOMMER

Applicant

And

C PTY LTD

First Respondent

MS M, IN HER CAPACITY AS A COSTS ASSESSOR

Second Respondent

REASONS FOR JUDGMENT

Introduction

  1. The first respondent (respondent) applies that I recuse myself on the ground of reasonable apprehension of bias. The respondent relies on three grounds:

    a)My duty “to remain an impartial observer has been compromised” by my actions in assisting the applicant as a self-represented litigant. The respondent submits I have “effectively been the architect of the case which the [respondent] now has to meet”.[1]

    b)I have predetermined the question of jurisdiction.

    c)I have made critical observations of the respondent and its legal representatives.

    [1] Outline of Argument on Behalf of the Applicant, [96]

  2. I was first notified that an application for recusal would be made at a directions hearing on 2 October 2020, 12 days before the day on which the matter had been set down for hearing. On 8 October 2020 the respondent filed an application in a case. Although at the directions hearing of 2 October 2020 I was told in general terms what the ground would be, I did not receive the respondent’s written submissions detailing the grounds on which the respondent relies until 11.08 am on 12 October 2020.

  3. I heard the application for recusal in the afternoon of 12 October 2020. At 4.15 pm on 13 October 2020 I dismissed the application for recusal, and said I would publish my reasons on 14 October 2020. These are my reasons.

  4. In these reasons for judgment, I will refer to myself as “the Judge” in relation to the conduct that is relevant to determining whether I have conducted myself in such manner as to give rise to a reasonable apprehension of bias.

Ground 1

  1. The first ground relies on what the Judge did commencing on 5 June 2020 when he delivered the first judgment. Since that time the Judge delivered three other substantial interlocutory judgments, one on 14 July 2020, one on 7 August 2020, and one on 18 September 2020.[2] The respondent submits that in paragraphs 46 and 47 of the first judgment the Judge impermissibly identified grounds on which the applicant, an unrepresented litigant, did not rely; and, by doing so, the Judge had impermissibly transformed the proceeding before him – an application to set aside the bankruptcy notice – into a proceeding that purports to incorporate issues that fall outside this Court’s jurisdiction. The respondent further submits that the Judge expanded those issues in the third judgment, particularly in paragraphs 38 and 39 of that judgment. It appears the respondent also submits the Judge induced the applicant to further expand her claims in the “Statement of Applicant’s Case” (SAC) which, on 21 August 2020, the Judge directed the applicant file and serve.

    [2] Sommer v C Pty Ltd [2020] FCCA 1412 (first judgment); Sommer v C Pty Ltd (No.2) [2020] FCCA 1898; (second judgment); Sommer v C Pty Ltd (No.3) [2020] FCCA 2156 (third judgment); Sommer v C Pty Ltd (No.4) [2020] FCCA 2589 (fourth judgment)

  2. Two questions arise. The first is whether the Judge impermissibly identified or introduced issues in the proceeding. The second is, to the extent the Judge did, whether “a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide” .[3] That question must be answered by reference to the hypothetical fair-minded lay observer.

    [3] Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 at [6] (Gleeson CJ, McHugh, Gummow and Hayne JJ)

  3. In addition to the knowledge and qualities that are usually attributed to a fair-minded lay observer,[4] it is relevant to this application that two further qualities be attributed to such observer. One is knowledge, in general terms, of the principles that govern the obligations of a judge in relation to an unrepresented litigant. The respondent identified a number of the relevant authorities;[5] but it will be sufficient if I refer to the following passages from the judgment of the Full Federal Court of Australia in Flightdeck Geelong Pty Ltd v All Options Pty Ltd (emphasis added):[6]

    The submissions advanced on appeal revealed the existing lack of clarity as to the obligations of a court to a litigant-in-person.  Though the principles might be succinctly stated at a high level of generality, their application in a particular case is somewhat more problematic.  Statements to the effect that, “Courts have an overriding duty to ensure that a trial is fair”:  see, eg, Dietrich v R (1992) 177 CLR 292, 330, 362; or that judges must ensure that trials are conducted fairly and in accordance with law: MacPherson v R (1981) 147 CLR 512, 523, are axiomatic but do not offer any great assistance in the particular circumstances of a trial.  On the other hand, the observations of Mason J (as his Honour then was) in MacPherson at 534 that the general duty to ensure that litigants do not suffer any disadvantage from exercising their right to be self-represented, includes the obligation to ensure that they do not remain in ignorance of a fundamental principle which, if invoked, may prove advantageous to them, do offer assistance at a more granular level.  The disadvantages to which Mason J referred are usually identified as a lack of knowledge (both of the law and the processes of the court) and a lack of objectivity: Tomasevic v Travaglini (2007) 17 VR 100, 130 [140] (Bell J).

    In practical terms, the Court may find it appropriate to provide the following kinds of assistance to a litigant-in-person:

    (a)Ensuring the litigant has sufficient information about the practice and procedure of the Court to make effective choices in the conduct of the matter:  Hamod [311].  For example, failing to explain the difference between formal sworn testimony and statements made from the bar table, and the significance of failing to file an affidavit, to enable a litigant-in-person to choose whether or not to give oral evidence, may amount to a denial of procedural fairness:  SZRUR [39]. Additionally, failing to explain the risks in not leading evidence where adverse inferences might be drawn may also constitute a denial of procedural fairness:  Downes v Maxwell Richard Rhys & Co Pty Ltd (in liq) (2014) 46 VR 283.

    (b)Ensuring the litigant is informed of procedures which, if invoked, may prove to be advantageous:  MacPherson, 534.  For example, failing to inform a litigant-in-person of their ability to apply for an adjournment may amount to a denial of procedural fairness:  AMF15, 50 [47].

    (c)Ensuring the litigant has not, because of a lack of legal skill, failed to claim rights or put forward arguments:  Rajski. 

    [4] As to which, see the authorities to which I refer in FKP17 & Ors v Minister for Immigration & Anor [2018] FCCA 2053, at [23], [24]

    [5] Outline of Argument on Behalf of the Applicant, [19]-[25]

    [6] Flightdeck Geelong Pty Ltd v All Options Pty Ltd [2020] FCAFC 138, at [55]

  4. Also relevant is the passage from the judgment of Neil v Nott that a “frequent consequence of self-representation is that the court must assume the burden of endeavouring to ascertain the rights of parties which are obfuscated by their own advocacy”.[7]

    [7] Neil v Nott (1994) 68 ALJR 509, at page 510

  5. Another matter that may need to be attributed to a fair-minded lay observer for the purposes of this application is some knowledge of the law of bankruptcy; and, in particular, the law that deals with the circumstances in which a bankruptcy court may go behind a judgment, and the consequences of a court’s deciding to do so. A bankruptcy court has a discretion to “go behind the judgment” if “substantial reasons are given for questioning whether behind that judgment there was in truth and reality a debt due to the petitioning creditor”.[8] Where the Court is satisfied such substantial reasons exist, the petitioning creditor will bear the legal burden of proving the judgment records a true debt.[9] These statements were made in the context of the hearing of a creditor’s petition; but the principles apply on applications to set aside bankruptcy notices. [10]

    [8] Wren v Mahony [1972] HCA 5; (1972) 126 CLR 212, at page 225 (Barwick CJ)

    [9] Cheung v Burness (Trustee) [2016] FCA 1381, at [79] (Moshinsky J)

    [10] Olivieri v Stafford (1989) 91 ALR 91, at pages 107-109, and in particular the discussion by Gummow J in Wilkinson v Osborne & Anor [1915] HCA 92; (1915) 21 CLR 89, Re Vernon Arnfield [1925] NSWStRp 63; (1925) 25 SR (NSW) 517, and Re Riviere; Ex parte Original Mont de Piete Ltd [1919] NSWStRp 56; (1919) 20 SR (NSW) 77

  6. The respondent submits that the fair-minded lay observer will be aware “that courts dealing with an application to set aside a bankruptcy notice are entitled to go behind a judgment”, but that the “established practice in bankruptcy courts does not include the court determining afresh in a final way the parties’ entitlements in respect of the debt”.[11] I do not accept this last proposition. In Cheung v Burness (Trustee) Moshinsky J said (emphasis in original):[12]

    [11] Outline of Argument on Behalf of the Applicant, [123]

    [12] Cheung v Burness (Trustee) [2016] FCA 1381, at [79]

    In circumstances where the bankruptcy court decides to ‘go behind’ a judgment, the onus of proof in relation to the underlying issue falls on the party claiming to be a creditor.  In Corney v Brien, Fullagar J said at 358:

    The question whether the judgment is to be reopened or “gone behind” at all will, of course, often involve some preliminary investigation of the merits of the attack on the judgment.  But, when once the court decides that it will “go behind” the judgment, the cases which I have cited show, in my opinion, that the whole matter is open. When once it is considered proper to “reopen”, the only question will be whether there was, in fact and in law, a debt which could legally found the judgment—whether there was in “Truth and Reality” an obligation not of record before there was an obligation of record.  If the case should be one of those rare cases (I have not actually found one in the Reports since 1888, when Fry L.J. said that he knew of none) where it is legitimate to “go behind” a judgment entered after trial in court, there would be, I think, no alternative but to re-try the whole case.  The matter to be decided is the existence or non-existence of a debt antecedent to the judgment. It has been said on several occasions that the judgment is prima-facie evidence of the antecedent debt. But, when once the inquiry is undertaken, I think that the ultimate burden of proof rests on the person claiming to be a creditor.  As Lord Esher M.R. said in In re Fraser; Ex parte Central Bank of London: “The existence of the judgment is no doubt prima-facie evidence of the existence of a debt; but still the Court of Bankruptcy is entitled to inquire whether there really is a debt due to the petitioning creditor”.

    (Footnotes omitted; emphasis added.)

  7. Thus, when positing the attributes a fair-minded lay observer is assumed to possess, it is to be assumed that he or she will be aware that it is permissible for a judge to provide assistance to an unrepresented litigant of the kind referred to in the passages from Flightdeck and Neil v Nott I have set out above; and that in certain bankruptcy applications, including applications to set aside a bankruptcy notice, it is relevant for a court to enquire into whether behind a judgment there in truth lies a debt and, where there are substantial reasons for questioning whether there is a real debt, to determine whether there is in fact a debt.

  8. In paragraph 46 of the first judgment the Judge set out what he said he understood to be one of the grounds on which the applicant relied; and in paragraph 47 the Judge identified the issues he considered arose from that ground. I do not accept, however, that a fair-minded lay observer might reasonably apprehend that by describing what the Judge understood to be one of the applicant’s grounds, and identifying the issues in paragraph 47, the Judge went beyond what a judge is permitted to do in relation to an unrepresented litigant. I am not satisfied that a fair-minded lay observer might reasonably apprehend that the Judge did anything more than endeavour to identify issues that might be relevant to ascertaining the applicant’s rights, or endeavour to attempt to ensure the applicant will not, because of a lack of legal skill, fail to claim rights or forward arguments. I am therefore not satisfied a fair-minded lay observer might reasonably apprehend that the Judge might not bring an impartial mind to the resolution of the questions he is required to decide in this proceeding.

  9. I also do not accept the respondent’s submission that in paragraphs 38 and 39 of the third judgment the Judge expanded the issues; and I am not satisfied that a fair-minded lay observer might reasonably consider the Judge added any additional issues. Paragraph 38 refers to the issues the Judge identified in the first judgment; and paragraph 39 of the third judgment only refers to evidence and claims the applicant made. That is apparent from the text of the paragraph (reference omitted):

    The evidence before me, however, revealed additional controversies between the applicant and the respondent. These are the subject of the complaints the applicant made to the Office of the Legal Services Commissioner, and the submissions the applicant made to the costs assessor. For example, in her affidavit of 17 May 2020 the applicant says that in her submissions to the costs assessor she was “seeking for the costs to be set aside due to the Respondent’s serious breach of its cost agreement with” her, and the applicant now submits that, in the light of the cost assessor’s finding that “there was a serious failure to advise in advance of increased costs and disbursements generally”, the costs agreement is void because of the operation of s.178(1) of the LP Law. The determination of these controversies may affect the respondent’s ability to recover its costs from the applicant, or the amount it may be entitled to recover from the applicant on account of its costs.

  10. Thus, I am not satisfied that a fair-minded lay observer might reasonably apprehend from paragraphs 38 and 39 of the third judgment that the Judge might not bring an impartial mind to the resolution of the questions the Judge is required to decide in this proceeding.

  11. The respondent submits the applicant further expanded her claims in the SAC. It is not clear whether the respondent submits that a fair-minded lay observer might reasonably apprehend the Judge induced the applicant to expand her claims. I will assume the respondent so submits. That means it will be necessary to set out the circumstances in which the Judge directed the applicant to file the SAC. That occurred at the hearing on 21 August 2020.

  12. At that hearing counsel for the respondent referred to paragraph 39 of the third judgment and said it was “unclear whether they [the issues the Judge identified in paragraphs 46 and 47 of the first judgment] might have been expanded”. Counsel said:[13]

    But if your Honour’s judgment was to range into the future - that is to say, as a result of the termination there will never be an entitlement to charge, then that is a scope that we say Federal jurisdiction wouldn’t include within it. But if your Honour considered contrary to that submission that it did, then the respondent would seek to know the precise nature of the case it is asked to answer in that regard so that it may prepare evidence appropriately - and submissions.

    [13] 21.08.2020 T9.5

  13. The Judge then made a number of observations which included the following (emphasis added):[14]

    HIS HONOUR:   Well, I mean, I’m thinking as a lawyer and as a contract lawyer.  I’ve got no view on it but it’s just well-established law that if there’s an issue about the termination of a contract, that - see, the starting point is there’s a bankruptcy notice.  Ms Sommer is unrepresented.  She doesn’t know the technicalities of it.  But the way it was understood is, one way or the other, she has challenged the debt in some way.  It seems that, perhaps, she has accepted the debt but only because she seems to have accepted that she challenged it before a costs assessor and failed.  But the point is, there is a debt being claimed and there’s two issues:  one is, have you got a right to the debt and there’s an agreement which regulates it; and there’s an issue about who terminated what.  And that - it’s just basic contract law that if a contract is terminated in a particular way, that may or may not have consequences for the recovery of the debt and that’s the only reason I raise those issues.  I don’t know if it’s - see, it’s not for me to make a case for anyone;  it’s just that they’re the issues that would strike a lawyer in the circumstances of this case. . . .

    . . . and if I can just keep on going, and I don’t want to focus on how I formulated it.  I mean, there is material in front of me where Ms Sommer makes claims that the agreement is void, for example.  That’s in the material in front of me.  I’m not sure whether she wants to run that case;  I assume she does.  So once you talk about a contract being void, well, then there’s a whole issue about, well, what’s the consequences of that to the parties’ right.

    [14] 21.08.2020 T9.10-T10.5

  14. Counsel for the respondent then made a number of submissions relating to the need for the respondent to know the case that is being made against it. This part of the hearing concluded with the following exchange:[15]

    MS CASTLE: Even before the costs assessment, the applicant was representing to the respondent that she recognised she had a liability to pay fees.  And so, your Honour, the - part of the reason - and I’m not seeking to cavil with your Honour’s judgment on 7 August, but part of the reason for Mr Edney previously submitting to your Honour that you should exercise the discretion to set aside the bankruptcy notice on the jurisdiction [sic] error point was that the, sort of, fully-blown contractual/quantum meruit case that looks like it is arising is one which, in fairness to the respondent, ought to be properly pleaded. 

    HIS HONOUR:   Well, there’s a lot of merit in what you say but - and - but the fact is, I have an unrepresented litigant here.  That doesn’t give an unrepresented litigant special privileges but it makes things difficult and, in fact, on some of the authorities, you’re supposed to help me to identify weaknesses in your case, which seems, perhaps, a little bit ‑ ‑ ‑ 

    MS CASTLE:  Yes.  Well, your Honour, I probably just ventilated some of the possibilities that we see ‑ ‑ ‑ 

    HIS HONOUR:   No.  No.  No.  And I’m not - I’m, obviously, not saying this by way of criticism.  It is difficult.  It places me in great difficulty because I’m here to adjudicate a dispute; I’m not here to favour one party over another.  And it - you know, I need to be careful and I’m - and, you know, to ensure that it’s - I’m fair to both parties. 

    [15] 21.08.2020 T10.40-T11.5

  1. After this exchange the applicant made the following submission:[16]

    I just wanted to add that since the time of the costs assessment, even before this court, I have made exactly the same claim.  It is not new or not ..... and, perhaps, was not in the initial application but was in every subsequent information that I submitted to the court and even all the documentation, including all the costs assessments, where I put in that I did not agree with the costs for particular reasons, which I don’t think should be outlined today. 

    [16] 21.08.2020 T11.30

  2. The Judge decided to direct the applicant to file a document in which she would state the relief that she seeks and the facts and grounds on which she relied for those claims. The Judge explained to the applicant what he proposed to require her to do as follows:[17]

    [17] 21.08.2020 T11.35

    HIS HONOUR:  No.  No, I’m not asking you to outline them today but the word “pleading” has been used.  Now, that - well, that’s a technical document but, essentially, what that - it’s a document which sort of sets out, in a relatively short compass, what a person’s claims are;  at least what the factual claims are.  So, I suppose - and this is something for you to think about.  What’s being asked is for you to put that sort of document, to the best of your ability, which is to say, what is your claims, really.  I’ve held - and unless I’m appealed, I’m going to assume I’m right, of course, that I’ve got jurisdiction to determine a controversy which arises out of the right [same] substratum of facts. 

    And as I see the substratum of facts, those facts are the circumstances in which your costs agreement came to an end and things that occurred in relation to the assessment of those costs, which includes things like your making submissions about that.  That, to me, is the substratum of facts.  So I suppose what I’m going to - what I’m thinking of doing and what’s being asked that you do, is for you to articulate, ultimately, what it is that you want me to order, apart from a setting aside of the bankruptcy notice.  So that’s one thing for you to think about.  If you - what is it that you want the court to do, you know, if you’re successful?  What rights do you think you have and what relief do you want from the court - that’s one thing to think about;  and, secondly, why do you say you’re entitled to what you want the court to do.   Is that - are those questions clear to you, Ms Sommer?

    MS SOMMER:  Yes, it is, your Honour.

    HIS HONOUR:  And would it be possible for you - and I will deal with this when we come back at 12 o’clock;  I know we’re running out of time but I think this is a useful discussion, because the respondent does have legitimate difficulties, forensically, from not having that sort of document, perhaps - is for you to - for me, subject to any submission to make, to direct you to prepare such a document which sets out what is the orders that you want and what are the grounds on which you seek them.  And it doesn’t - so it has got to be comprehensive enough for them to understand what you’re - what the case is that you want to make but not necessary for you to go through or refer to your evidence, it being understood that the claims you wish to make will be - you intend to support by the evidence that you have filed. 

    MS SOMMER:  I will - yes, your Honour.  I will summarise everything that I’ve put in and look at writing the - not look at writing - I will write the pleading as you described ‑ ‑ ‑ 

  3. A little later in the hearing the Judge read the form of orders the Judge proposed to make for the filing of what the Judge described in the order the Judge made. Near the end of the meaning the following exchange occurred:[18]

    [18] 21.08.2020 T25.30

    HIS HONOUR: . . . . And, Ms Castle, this is more [directed] to you.  I shouldn’t really say this but you’re perfectly free to make any vigorous submission to the extent you feel I am not - if I’m doing too much for an unrepresented litigant.

    MS CASTLE:  Your Honour, I appreciate the fine line that the court has to tread.  It’s a difficult matter but I had in mind that I would do what your Honour has invited me to do and I’m grateful for that.

    HIS HONOUR:  I’m not saying that.  It’s just that some - I often say it because some counsel find a discomfort in it.

    MS CASTLE:  Thank you, your Honour.  I’m grateful.

  4. I am not satisfied that a fair-minded lay observer might reasonably apprehend the Judge induced the applicant to expand her claims and, for that reason, the Judge might not bring an impartial mind to the resolution of the questions the Judge is required to decide in this proceeding.

  5. Counsel for the respondent submitted it was the Judge who made an issue in the proceeding whether the Costs Certificate was based on a costs determination that was affected by jurisdictional error. I do not accept that submission. At paragraph 60 of the first judgment the Judge adverted to the possibility of the costs determination being affected by jurisdictional error, and identified the grounds on which it might be so affected. The Judge went no further than to indicate that at the hearing that had been set down for 10 July 2020 he intended to invite submissions on a number of questions. The first was whether “it is open to the Court to invite parties to make submissions on the” questions the Judge identified in the remainder of the paragraph. Those questions related to the manner in which the costs assessor assessed the respondent’s costs and, depending on the answer to those questions, whether “the costs determination on the basis of which the Costs Certificate was issued be affected by jurisdictional error such as to give rise to a substantial reason for questioning whether behind the amount recorded in the Costs Certificate which was registered as a judgment there was in truth and reality a debt due to” the respondent.

  6. The question whether the costs determination on the basis of which the Costs Certificate was issued is affected by jurisdictional error did become an issue in the proceeding. The circumstances in which this occurred are set out in the third judgment.[19] Those circumstances consisted in the respondent, without notice to the Court or to the applicant, applying for a review of the costs determination on the basis that the costs assessor had made what the respondent contended were jurisdictional errors, and then proffering a consent order to the applicant that noted that “by consent and on the grounds of jurisdictional error . . . that the parties have agreed to set aside the Bankruptcy Notice”.[20]

    [19] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, [8]-[21]

    [20] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, [20]

  7. Counsel for the respondent submitted this did not amount to the respondent adding jurisdictional error of the costs determination as a ground in the applicant’s application to set aside the bankruptcy notice. I do not accept the submission. The terms of the proposed consent order the respondent proffered to the applicant identified jurisdictional error as a ground for setting aside the bankruptcy notice. Counsel also submitted the respondent did not need to give any ground for having the bankruptcy notice set aside. That amounts to a submission that it was open to the respondent to unilaterally withdraw the bankruptcy notice. In the second judgment the Judge determined it was not open to the respondent to unilaterally withdraw the bankruptcy notice. That determination is not the subject of any appeal or leave to appeal.

  8. The respondent submits that the Judge’s ordering the joinder of the costs assessor as a party and seeking a declaration as to the validity of certain acts of the costs assessor constituted “a further step taken by Your Honour that had the effect of enlarging the dispute between the parties beyond that which the [applicant] had contended”.[21] I do not accept that the Judge’s making the orders enlarged the dispute between the parties. As is apparent from the third judgment, the respondent contended that the costs determination on the basis of which the Costs Certificate was issued was affected by jurisdictional error. That is relevant to whether behind the judgment on the basis of which the bankruptcy notice has been issued against the applicant (Judgment) there is in truth a debt – a question which, in turn, is relevant to whether the bankruptcy notice should be set aside. As the Judge noted in the fourth judgment, a claim that a decision made by the costs assessor was affected by jurisdictional error – a claim the respondent made – rendered the costs assessor a necessary party.[22] Further, although the Judge had drafted the declaration, the declaration went no further than referring to the grounds on which the respondent, in the costs review application, contended the costs determination was affected by jurisdictional error.

    [21] Outline of Argument on Behalf of the Applicant, [69]

    [22] Sommer v C Pty Ltd (No.4) [2020] FCCA 2589, [48]

  9. There is a final matter to note about this submission. It ignores the Judge made an order joining the costs assessor after he invited the parties to make submissions about whether the applicant should amend the application to include orders under s.69 of the Supreme Court Act 1970 (NSW) (NSWSC Act). The fourth judgment records the reasons why the Judge invited the parties to make submissions on that question. As recorded in the fourth judgment, counsel did not submit the Judge should not require the applicant to file an amended application that includes an application for an order under s.69 of the NSWSC Act.

  10. At the hearing of the recusal application, counsel submitted the Judge had impermissibly added as issues matters relating to what in the fourth judgment is described as the “CA Supplementary Reasons”.[23] It is true the Judge identified issues. But this occurred in the context described in the fourth judgment,[24] and in the context of what occurred at the hearing of 11 September 2020. At that hearing counsel for the respondent made submissions about the CA Supplementary Reasons. That occurred because counsel for the respondent said that her instructions “are that the respondent intends to withdraw the application for review and the application for an extension of time as a result of the” CA Supplementary Reasons, and the Judge asked questions about this. There was a discussion about various aspects of the CA Supplementary Reasons. The Judge was not bound to accept that which counsel submitted was the effect of the CA Supplementary Reasons. In those circumstances, I am not satisfied a fair-minded lay observer might consider the Judge added additional issues. A fair-minded lay observer would instead conclude that all the Judge did was to identify as issues matters that counsel for the respondent had raised at the hearing on 11 September 2020 but which the Judge had not accepted.

    [23] Sommer v C Pty Ltd (No.4) [2020] FCCA 2589, [49]

    [24] Sommer v C Pty Ltd (No.4) [2020] FCCA 2589, [18]-[38]

  11. The respondent submits that as a consequence of the Judge’s interventions:[25]

    The proceedings are no longer about setting aside the Bankruptcy Notice, which the [respondent] has conceded should occur. They are about the parties’ rights in relation to the payment of legal fees and damages claims arising from alleged breaches of retainer. However, on the pleaded case they are not about the matters identified by the Court. Rather, they are, on the pleaded case, a claim for breach of contract said to give rise to damages for emotional distress and other claims, including for breach of fiduciary duty. On the unpleaded case the proceedings are about the consequences of termination and its effect on the parties’ rights and entitlements generally in relation to legal fees.

    [25] Outline of Argument on Behalf of the Applicant, [102]

  12. This does not refer to the issues identified in paragraph 72 of the fourth judgment the Judge considered to be the issues that are to be determined at the hearing. None of the issues the Judge identified goes beyond the question of whether the applicant owes the respondent a debt. More particularly, the relevance of the issues the Judge identified in paragraph 72 of the fourth judgment do not go beyond the question whether behind the Judgment there is in truth a debt. If that is an accurate statement of the relevance of the issues the Judge identified, that the issues relate to the solicitor client relationship or its termination does not alter the fact that the issues are relevant to whether behind the judgment there is in truth a debt.

  13. Near the end of his submissions, counsel for the respondent submitted I should stand back and view the course of the proceeding as a whole. Counsel submitted that if that is done, a fair-minded lay observer might apprehend that in the course of the proceeding the Judge introduced and expanded the issues in the proceeding, and the Judge did so impermissibly. Whether a fair-minded lay observer might so apprehend the course of the proceeding should be assessed by reference to the following matters:

    a)On 5 June 2020 the Judge delivered the first judgment. The judgment included a description of the grounds on which the Judge understood the applicant relied, and the issues the Judge identified in paragraph 47. The Judge made directions for the filing of evidence, and he set down for hearing on 10 July 2020 the application to set aside the bankruptcy notice. The Judge also granted the parties liberty to apply.

    b)The respondent did not file any evidence. Instead, on 10 July 2020, the appointed hearing date, the respondent submitted the application to set aside the bankruptcy notice should be dismissed because the respondent had withdrawn the bankruptcy notice. Counsel for the respondent did not submit the Judge had expanded, permissibly or impermissibly, the applicant’s claims; or that the respondent did not understand the applicant’s case; or that the respondent required the applicant to plead her case.

    c)On 14 July 2020 the Judge delivered the second judgment in which he decided it was not open to the respondent to unilaterally withdraw the bankruptcy notice; and on 17 July 2020, on the application of the respondent, the matter was adjourned to 31 July 2020 for the purpose of giving the respondent time to consider whether it would seek leave to appeal against the Judge’s determination that it was not open to the respondent to unilaterally withdraw the bankruptcy notice.

    d)By the time the matter was next before the Court on 31 July 2020 it was apparent the respondent did not intend to apply for leave to appeal. Instead the respondent had applied for review of the determination of costs, and at the hearing counsel applied for an order that the application to set aside the bankruptcy notice be dismissed because the respondent had conceded the costs assessor made a jurisdictional error.

    e)On 7 August 2020 the Judge delivered the third judgment in which he dismissed the respondent’s application that the bankruptcy notice be set aside on the ground that the respondent had conceded that the costs determination was affected by jurisdictional error.

    f)On 21 August 2020, when the matter came before the Court because the respondent said it was unclear about what it was to do in relation to the costs review application, an oral application was made that the applicant plead her case. That was the first occasion on which the respondent applied to the Court for an order that the applicant plead her case. The stated basis of that application was that paragraph 39 of the third judgment had expanded the issues the Judge identified in the first judgment. Counsel for the respondent did not submit that the issues the Judge had identified in the first judgment did not arise on the material that was before the Court, or that the Judge had impermissibly identified those issues. I have already found that a fair-minded lay observer would reasonably understand paragraph 39 of the third judgment as referring to claims the applicant had already made in material that had been filed. The Judge directed the applicant to file the SAC.

    g)On 3 September 2020 the matter came before the Court in response to the possibility of the costs assessor proceeding with the costs review application. That question was resolved but on a basis counsel for the respondent, and consequently, the respondent, had misunderstood. At the hearing counsel for the respondent indicated the respondent intended to apply to strike out the SAC.

    h)The matter came before the Court on 11 September 2020. A number of matters were dealt with, one of which was the hearing of the respondent’s application to strike out orders 2, 3, and 4 of the SAC, and the contentions that supported them.

    i)On 18 September 2020 the Judge delivered the fourth judgment. The Judge struck out parts of the SAC, identified in paragraph 72 of the judgment the issues for hearing, made a number of orders, including orders for the filing of further evidence, and set the matter down for hearing on 14 and 15 October 2020. The Judge also set the matter down for a directions hearing on 2 October 2020.

    j)At the direction hearing on 2 October 2020 junior counsel informed the Judge that the respondent intended to apply that the Judge recuse himself.

  14. I am not satisfied that a fair-minded lay observer might consider that the course of the proceeding manifests the expansion of issues at the initiation of the Judge. A fair-minded lay observer would apprehend that the Judge identified issues in a judgment delivered on 5 June 2020 and set the matter down for hearing on 10 July 2020, but the course of the proceeding after that time was largely governed by actions the respondent had taken: it unsuccessfully applied for the dismissal of the proceeding on the basis of a purported withdrawal of the bankruptcy notice; it then unsuccessfully applied for the dismissal of the proceeding on the ground of a conceded jurisdictional error; it successfully applied for an order that the respondent plead her case; and it applied for an order that the SAC be struck out in which it partly succeeded. The matter also came before the Court on a number of occasions in relation to issues that arose as a consequence of the costs review application the respondent had initiated in another tribunal.

  15. I do not make any criticism of anything the respondent did. These matters, however, are relevant to assessing how a fair-minded lay observer might view the Judge’s role in the course of the proceeding. The proceeding sprawled from the simplicity of the hearing the first judgment contemplated would occur on 10 July 2020; but that was not due to the Judge adding or inducing the applicant to add issues beyond those the Judge identified in the first judgment and on those on which the applicant intended to rely; and a fair-minded lay observer would not reasonably apprehend that the course the proceeding has taken might have been due to the Judge adding or inducing the applicant to add issues.

  16. I am not, therefore, satisfied that a fair-minded lay observer might reasonably apprehend the Judge was the architect of the applicant’s case, or that the Judge expanded issues or that the Judge otherwise rendered assistance to an unrepresented litigant beyond that which is permissible. For these reasons, I am not satisfied that on viewing the course of the proceeding as a whole a fair-minded lay observer might reasonably apprehend the Judge might not bring an impartial mind to the resolution of the questions the Judge is required to decide in this proceeding.

Ground 2 – prejudgment of jurisdiction

  1. The second ground is as follows:

    The Applicant contends in its defence that much of the claim other than that to which it has already consented) [sic] is beyond the jurisdiction of this Court. In determining jurisdictional questions in interlocutory applications by reference to a controversial application of “the matter” identified by the Court, without the benefit of full submissions, and without identifying the issue as a preliminary issue, a reasonable apprehension arises that the Court has pre-judged the question of jurisdiction which will arise at the hearing . . .

  1. The basis of this ground is developed in paragraph 109 of the respondent’s written submissions. It is there submitted the Judge has “predetermined the issue of federal jurisdiction” in circumstances where:

    a)The parties were not given “an opportunity (or at least a full opportunity) to be heard in relation to the determination of that matter, which was effectively decided as a separate issue”.

    b)The Judge subsequently considered he had determined the issue of jurisdiction.

    c)The question was determined “prior to the Applicant understanding the proposed scope of the case sought to be made against it”.

    d)The question was formulated on the basis of issues formulated by the Court and not by the applicant.

    e)The question was determined at a time when the applicant’s application was to set aside the bankruptcy notice, and the only issues identified between the parties appeared to be no more than the reason to go behind the judgment.

    f)No further relief was sought in relation to the identified issues such as would affect the respondent’s entitlement to pursue its debt.

  2. The issue of jurisdiction this ground claims a fair-minded lay observer might consider the Judge has predetermined is the issue of jurisdiction raised in paragraph 4A of the “First Respondent’s Response to Statement of Applicant’s Claim”, a document the respondent filed on 12 October 2020. The respondent there contends that the Court has no jurisdiction to investigate whether the applicant had a liability to pay the respondent’s legal fees at the time of applying for a costs determination or the bankruptcy notice.

  3. This ground is to be assessed by reference to the following matters.

    a)The third judgment – which is the judgment on jurisdiction to which this ground is directed – was published after the Judge heard argument at the hearing on 31 July 2020. Before that day the Judge’s associate, at his direction, sent an email, the second paragraph of which was as follows:[26]

    [26] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, at [3]

    The respondent’s submissions assume that the only issues before the Court are those arising under the Bankruptcy Act 1966 (Cth). Is that correct, given the matters and issues identified in paragraphs 46 and 47 of the judgment his Honour delivered on 5 June 2020, and given the Federal Circuit Court may have jurisdiction over non-federal claims that arise out of the same substratum of facts out of which claims in relation to which it does have jurisdiction arise? (See, for example, El-Hanania v Vella (No.4) [2020] FCCA 265)

    b)The question considered by the third judgment is whether the Court should set aside the bankruptcy notice in circumstances where the respondent conceded that the determination of costs was affected by jurisdictional error, but the respondent did not concede the other issues which the respondent, in its written submissions, accepts went no further than whether there was a substantial reason for going behind the Judgment. The effect of the third judgment was that the Court had jurisdiction to determine those issues the respondent did not concede, even if the respondent conceded the costs determination was affected by jurisdictional error, and even if, because of that concession, the respondent conceded the bankruptcy notice should be set aside; and that was because those issues formed part of a justiciable controversy between the parties that arose out of the same substratum of facts.

    c)In the application to strike out the SAC the respondent did not submit that any of the claims or allegations were beyond the jurisdiction of this Court. The challenge was made on pleading grounds. The Judge recorded this in the fourth judgment:[27]

    At the hearing I enquired of counsel whether the respondent seeks to strike out the challenged paragraphs on the ground that the applicant does not have reasonable prospects of succeeding on the claims made in those paragraphs, or whether the application is made on the basis that the challenged paragraphs do not comply with the rules of pleading. Counsel for the respondent said the respondent relied on the latter.

    d)In the fourth judgment the Judge noted that even if Order 4 of the SAC, and the contentions made in support of that order, were capable of being adequately framed, a question would arise whether it “can be said to arise out of the same substratum of facts out of which the applicant relies for seeking to set aside the bankruptcy notice arise”.[28]

    e)The contentions on which the respondent says it will rely on any question of jurisdiction are not contentions that had been put to the Judge, and it is not suggested the Judge has otherwise considered any of those contentions.

    [27] Sommer v C Pty Ltd (No.4) [2020] FCCA 2589, at [52]

    [28] Sommer v C Pty Ltd (No.4) [2020] FCCA 2589, at [70]

  4. In these circumstances, I am not satisfied a fair-minded lay observer might apprehend the Judge did not give the respondent fair notice of the question of jurisdiction the Judge decided in the third judgment. Nor am I satisfied that a fair-minded lay observer might apprehend the Judge might not bring an impartial mind to the resolution of any question of jurisdiction.

Ground 3

  1. Ground 3 claims the Judge made various observations critical of the respondent and its legal representatives. Counsel for the respondent informed me the respondent does not rely on this ground as an independent ground, but relies on it to give context to the first two grounds. I propose, however, to address the ground.

  2. First, exception is taken to the Judge’s use of the words “in truth”, “purported”, “apparent”, and “apparently” in that part of the third judgment in which the Judge concluded he was not satisfied the respondent “has in truth conceded that the Costs Determination is affected by jurisdictional error”, or, alternatively, if “the respondent has conceded that the Costs Determination is affected by any jurisdictional error, its understanding of what it believes it has conceded is not jurisdictional error as understood by the law”.[29] It is submitted the Judge’s refusal to accept the concession of jurisdictional error “was capable of giving rise to the appearance of the Court seeking to maintain control over the matter and not allow any other tribunal to operate”.[30] To the extent this submission is intended to convey that the Judge sought to exercise jurisdiction the Judge did not believe he had, I would not accept that anything the Judge said in the third judgment could be reasonably so understood.

    [29] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, at [31]

    [30] Outline of Argument on Behalf of the Applicant, [118]

  3. Second, the respondent submitted that statements made in the third judgment “suggested a belief that the [respondent] and its legal representatives were acting inappropriately in connection with an unrepresented litigant who need [sic] to be protected from those actions”.[31] I do not accept that submission. The applicant had submitted, but the Judge did not accept, that the respondent’s lawyers had abused their power.[32]

    [31] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, at [118]

    [32] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, at [45]

  4. Third, exception is taken to paragraph 30 of the third judgment where the Judge said that if “in truth the respondent conceded that the Costs Determination was affected by jurisdictional error, it would at the very least have sought a declaration from the Supreme Court of New South Wales to that effect”. The respondent submits this statement relies on a number of assumptions and conclusions that had not been put to the respondent “in respect of which submissions could have been made”.[33] The respondent submits this implies “serious criticism of the conduct of the” respondent and its lawyers.[34] The respondent sets out in paragraphs 86-89 of its submissions the submissions the respondent may have made. These submissions refer to authorities that have held that, as a matter of discretion, prerogative relief should be withheld in relation to costs determinations where there is a statutory procedure for their review.

    [33] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, at [85], [86]

    [34] Sommer v C Pty Ltd (No.3) [2020] FCCA 2156, at [86]

  5. I do not accept that a fair-minded lay observer might reasonably apprehend that in this part of the third judgment the Judge was criticising the respondent or its lawyers. A fair-minded lay observer would read this part of the judgment as reflecting the opinion of the Judge about what a person, in the circumstances of the case before the Judge, would have done had the person conceded jurisdictional error. In any event, that the respondent may not have applied to the Supreme Court for prerogative relief because there is available an administrative mechanism for review only confirms it elected to pursue a process that did not entail the contention that the costs determination was affected by jurisdictional error.

  6. The respondent also appears to take exception to paragraph 28 of the third judgment where the Judge said that if the respondent “in truth concedes the Costs Determination is affected by jurisdictional error” it “would instead have sought a declaration from this Court to the effect that the Costs Determination is affected by jurisdictional error”. The respondent submits:[35]

    When the [respondent] made the Application this Court had not articulated that it had jurisdiction to determine the whole “matter” (and how broad that “matter” was thought to be) and had not expressed the view which is now apparent, that it had jurisdiction to the exclusion of the NSW Costs Assessment System. Those are both matters in respect of which the applicant did not have proper of fair opportunity to address the Court before it decided the question of federal jurisdiction, along with the consequence that the jurisdiction disabled the jurisdiction of the NSW Costs Assessment System. It is apparent from the Court’s restraint of the applicant that the Court has predetermined those issues.

    [35] Outline of Argument on Behalf of the Applicant, [88]

  7. These submissions ignore that in paragraph 60 of the first judgment, which was delivered on 5 June 2020, the Judge said:

    There is one matter I wish to raise; and that relates to the Costs Certificate. The applicant does not make any claim about the Costs Certificate; she accepts she is liable to pay the costs recorded in the Costs Certificate. Nevertheless, on the material before me, there may potentially arise issues of the sort I considered in Obrart v Grego [[2017] FCCA 929, at [52]-[72]], where I held that in certain circumstances a bankruptcy court can go behind a judgment based on a costs certificate if there are substantial reasons for questioning the validity of a costs certificate because the costs certificate was issued on the basis of a costs determination that may be affected by jurisdictional error. I propose, therefore, to invite the parties at the hearing of the application to set aside the bankruptcy to make submissions on the following questions . . .

  8. In Obrart the Judge considered the principles relating to a bankruptcy court going behind a judgment; how those principles apply to judgments based on costs certificates; and how jurisdictional error may be a ground for concluding that behind a judgment registered on the filing of a costs certificate based on a costs determination there is in truth no debt. In Obrart the Judge also considered, but rejected, a submission that the existence of review rights in relation to a costs determination does not automatically render a costs certificate void or a nullity, and found that a costs assessment is liable to collateral attack.[36] The respondent, in its written submissions, does not refer to the Judge having referred the parties to Obrart. The respondent does not say whether it or its lawyers read Obrart or, if it did why, having regard to what the Judge there considered and decided in Obrart, the respondent elected to apply for a review of the costs determination.

    [36] Obrart v Grego [2017] FCCA 929, at [122]-[128]

  9. I therefore do not accept that the respondent did not have proper or fair opportunity to make submissions about the principles that relate to the interrelationship between a bankruptcy court going behind a judgment based on a costs determination, and the administrative mechanisms for the review of such costs determinations; and I am not satisfied that a fair-minded lay observer might apprehend the respondent had not been given such fair opportunity.

  10. Fourth, the respondent takes exception to the Judge using the word “mischaracterises” in paragraph 18(a) of the third judgment. The respondent does not identify the word, other than “mischaracterises”, it would have been appropriate for the Judge to use to describe the respondent’s submission to the Manager, Costs Assessment, that the Judge is “attempting to perform the role of the Review Panel by reviewing the decision of the assessor”. A fair-minded lay observer would not apprehend that “mischaracterises” is an inappropriate characterisation of the respondent’s submissions to the Manager, Costs Assessment.

  11. Fifth, exception is taken to the Judge stating in the fourth judgment that he attached little value to the apologies given by the respondent’s solicitor and its counsel, because the respondent has taken advantage of the truth of its misunderstanding.[37] It is submitted that it is a “serious matter to characterise an apology given by a party’s representative as of “little value”, particularly in circumstances where they were not given the opportunity to be heard in relation to that characterisation and, in the case of counsel at least, the apology was expressed to be accepted”.[38] It is submitted that it is unclear how it could be said that the respondent has taken advantage of its misunderstanding about which an apology had been given.

    [37] Outline of Argument on Behalf of the Applicant, [92]

    [38] Outline of Argument on Behalf of the Applicant, [92]

  12. This part of the respondent’s submissions refers to the matters the Judge considered in paragraphs 18-42 of the fourth judgment. The “fruits of the misunderstanding” to which the Judge referred in the fourth judgment, and in relation to which an apology was given, is the CA Supplementary Reasons.[39] The respondent, however, has taken advantage of the CA Supplementary Reasons, and a fair-minded lay observer would so apprehend. That is apparent from what counsel for the respondent told the Judge in the passage reproduced in the respondent’s written submissions. Counsel said that the “the costs assessor, having now issued two sets of reasons, when they are taken together has issued a determination which is free from jurisdictional error” (emphasis added). It would be appropriate to set out what counsel said after this passage (emphasis added):

    Your Honour, I should go on to say that the respondent doesn’t say that because the combination of the two sets of reasons don’t contain error that somehow the judgment that it obtained is valid.  It doesn’t say that the correction reaches back, and it doesn’t seek to take some sort of advantage about that.  It simply says that as of 9 September, the assessor fulfilled her statutory function without jurisdictional error.

    [39] Sommer v C Pty Ltd (No.4) [2020] FCCA 2589, at [31]

  13. Further, in the application for review of the costs determination the respondent submitted that the costs assessor did not direct her mind to, and consider, whether the legal costs and counsel’s fees were fair and reasonable.[40] In paragraph 2(b) of the “First Respondent’s Response to Statement of Applicant’s Claim”, filed on 12 October 2020, however, the respondent now does not admit this.

    [40] Application for Review of Determination(s) of a Costs Assessor, [2.1], [2.2]

  14. I therefore do not accept that a fair-minded lay observer might reasonably apprehend that because the Judge attached little value to the apologies the respondent’s legal representative proffered he might not bring an impartial mind to the resolution of the questions the Judge is required to decide.

Other matters

  1. The respondent submitted that a fair-minded lay observer might think that by the Judge deciding not to refer the applicant to pro bono assistance after he indicated he might do so, the Judge did not wish to relinquish the role he was playing, or wish the applicant to have the assistance of a lawyer. This submission is predicated on the view that a fair-minded lay observer might reasonably apprehend that the Judge might have been rendering assistance to the applicant beyond that which it was permissible for the Judge to do so, and it was this impermissible assistance the Judge was unwilling to relinquish.

  2. I have found I am not satisfied that a fair-minded lay observer might so reasonably apprehend. Further, the Judge was not obliged to give reasons for not referring the applicant for pro bono assistance. In those circumstances, I am not satisfied that a fair-minded lay observer might reasonably apprehend that because the Judge decided not to refer the applicant for pro bono assistance the Judge intended to render to the applicant assistance beyond that it was permissible for the Judge to provide.

Cumulative consideration

  1. I have considered whether, if each of the matters on which the respondent relies are considered together, a fair-minded lay observer might reasonably apprehend the Judge might not bring an impartial mind to the resolution of the questions the Judge is required to decide in this proceeding. I am not satisfied such observer would so apprehend.

The applicant’s submissions

  1. The applicant submitted that the respondent’s application for recusal is a delay tactic. That submission would need to be assessed against the following:

    a)The Judge issued four substantial interlocutory judgments, the last having been delivered on 18 September 2020.

    b)The matter had been set down for hearing on three occasions – on 10 July 2020, on 28 and 29 September 2020, and on 14 and 15 October 2020.

    c)After the first judgment was published on 5 June 2020, but before 2 October 2020, the matter came before the Judge on 10 July 2020, 17 July 2020, 31 July 2020, 21 August 2020, 3 September 2020, and 11 September 2020.

    d)On 18 September 2020 the Judge set the matter down for hearing on 14 October 2020.

    e)On 24 September 2020 the respondent briefed senior counsel.

    f)On 1 October 2020 senior counsel gave advice in conference.

    g)At the directions hearing of 2 October 2020 junior counsel informed the Judge she was “instructed to file an application to ask your Honour to recuse yourself and, in respect of that, senior counsel is briefed … and is available next week or at other time, as it suits the court’s convenience”. The Judge asked the ground on which the application was to be made, in response to which junior counsel said:

    Your Honour, I can tell you as far as I am concerned but senior counsel may have some further ideas. It’s essentially a ground, your Honour, that your Honour has impermissibly entered into the arena. It’s not pre-judgment ground. It’s that your Honour has impermissibly entered into the arena and misconstrued the obligation to provide assistance to the litigant in person. That essentially captures it.

    h)At the directions hearing on 2 October 2020 the Judge asked junior counsel whether she could “give me more particulars than that”. Junior counsel said (emphasis added):

    Your Honour, I can’t be more specific at this time because I have not yet been – firstly, we have not got all the transcripts and such that we got yesterday afternoon I have not yet had the chance to read and so, your Honour, I’m afraid that’s as far as I can take it today.

    i)At the directions hearing on 2 October 2020 junior counsel also informed the Judge the respondent proposed to file an extension of time for leave to appeal from the orders the Judge made on 7 August 2020 and also seek leave to appeal from the orders the Judge made on 18 September 2020; and that the respondent intended to apply for the hearing that had been set down on 14 and 15 October 2020 to be vacated.

    j)On 2 October 2020 the respondent filed with the Federal Court of Australia an “Application for extension of time and leave to appeal”.

    k)At 12:57 pm on 8 October 2020 the lawyer for the respondent sent the following email to the Judge’s associate:

    Dear Madam Associate

    We would be most grateful if you would please bring to His Honour Judge Manousaridis’ attention that we have lodged the attached application in a case and affidavit in support with eLodgment, but await same to be sealed before formally serving upon the Respondents.

    We have copied the Applicant and the Solicitors for the Second Respondent to this email.

    l)Attached to the email was an application in a case in which the following orders are sought.

    1. An Order that Judge Manousaridis recuse himself from further hearing the proceedings on the basis of reasonable apprehension of bias.

    2.An Order that the hearing dates of 14 and 15 October 2020 be vacated given the Applicant’s contention that the Court is without jurisdiction and its application for an extension of time and leave to appeal from the Judgment and Orders of Judge Manousaridis made on 7 August 2020 and 16 [sic] September 2020 which was lodged for filing with the Federal Court of Australia on 2 October 2020 (proceedings NSD …/2020).

    3. An order that the proceedings be stayed pending the appeal to the Federal Court of Australia.

    m)The application in a case was supported by an affidavit made by Ms A, the principal solicitor of the respondent. In paragraph 5 of her affidavit Ms A deposes that the “grounds for the application will be provided in written submissions which are currently being prepared by counsel”.

    n)On 8 October 2020 the Judge listed for hearing at 10.15 am on 12 October the respondent’s application in a case. That was later changed to 2.15 pm on 12 October 2020 at the request of the respondent.

    o)At 11:08 am on 12 October 2020 the Judge’s associate received by email the respondent’s written submissions in support of the application for recusal. That document comprised 129 paragraphs, all but the last 4 of which related to the recusal application.

    p)The respondent has proffered no explanation why it had not notified the Judge before 2 October 2020 that it proposed to apply for the Judge to recuse himself.

  1. Given these matters it would have been open to me to consider whether, as the applicant submitted, the respondent’s conduct constitutes a delaying tactic. Given I am not satisfied the respondent has made out its case for recusal, it is not necessary to consider the applicant’s submission. I nevertheless feel bound to make the following observations.

    a)When junior counsel informed the Judge on 2 October 2020 the respondent intended to apply for the recusal of the Judge, it is apparent the respondent had not obtained all of the transcripts. It appears, therefore, the respondent decided to inform the Judge it intended to apply to recuse the Judge before the respondent had received all of the transcripts, and before its counsel had read the transcripts the respondent had received.

    b)The applicant and the Judge were given very little time to consider the lengthy written submissions which contained the grounds and matters on which the respondent relied for the recusal application. The Judge and applicant were provided with the grounds and matter on which the respondent intended to rely three hours before the Judge had set down for hearing the recusal application, and less than two days before the date on which the matter had been set down for final hearing.

  2. There is a final matter to note. Had I formed the view that any of the acts on which the respondent relies disclosed reasonable apprehension of bias, it would have been necessary to consider the question of waiver.[41]

    [41] See, for example, Vakauta v Kelly [1989] HCA 44; (1989) 167 CLR 568

I certify that the preceding fifty-nine (59) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis

Associate: 

Date: 14 October 2020


Cases Citing This Decision

0

Cases Cited

20

Statutory Material Cited

2

Sommer v C Pty Ltd [2020] FCCA 1412
Sommer v C Pty Ltd (No.2) [2020] FCCA 1898
Sommer v C Pty Ltd (No.3) [2020] FCCA 2156