State of New South Wales v Macatangay
[2016] FCCA 1226
•27 May 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| STATE OF NEW SOUTH WALES v MACATANGAY | [2016] FCCA 1226 |
| Catchwords: BANKRUPTCY – Creditor’s petition – notice stating grounds of opposition to petition filed – whether Court should go behind judgment founding debt. |
| Legislation: Bankruptcy Act 1966 (Cth), s.52(2)(b) Industrial Relations Act 1996 (NSW), s.84 |
| Cases cited: Macantangay v New South Wales [2012] NSWCA 108 Macatangay v New South Wales [2013] NSWCA 237 Macatangay v New South Wales [2015] FCA 495 Macatangay v NSW Department of Education & Training [2004] NSWIRComm 1043 Macatangay v NSW Department of Education & Training [2005] NSWIRComm 69 Macantangay v New South Wales [2007] NSWSC 57 Patane v Asteron Life Ltd (formerly Royal & Sun Alliance Financial Services Ltd) [2004] FCA 232 |
| Applicant: | STATE OF NEW SOUTH WALES |
| Respondent: | MIGUELA ALVAREZ MACATANGAY |
| File Number: | SYG 2850 of 2015 |
| Judgment of: | Judge Dowdy |
| Hearing date: | 18 March 2016 |
| Delivered at: | Sydney |
| Delivered on: | 27 May 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr M Minehan |
| Solicitors for the Applicant: | Hicksons Lawyers |
| The Respondent: | The Respondent appeared in person. |
ORDERS
A sequestration order be made against the estate of Miguela Alvarez Macatangay.
The applicant creditor’s costs, including any reserved costs, be taxed and paid from the bankrupt estate of Miguela Alvarez Macatangay.
A copy of this sequestration order be given to the Official Receiver in Sydney within two days.
The Court Notes that the date of the act of bankruptcy is 30 April 2015.
The Court Notes that a consent to act as joint and several trustees of the bankrupt estate of Miguela Alvarez Macatangay has been signed by the registered trustees, Messrs Jason Lloyd Porter and Terry Grant van der Velde.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2850 of 2015
| STATE OF NEW SOUTH WALES |
Applicant
And
| MIGUELA ALVAREZ MACATANGAY |
Respondent
REASONS FOR JUDGMENT
Introduction
By a Creditor’s Petition presented on 19 October 2015 (Petition) the State of New South Wales, as judgment creditor pursuant to a judgment in the amount of $100,679.39 of the Supreme Court of New South Wales dated 22 July 2011 (the creditor), seeks a sequestration order against the estate of the respondent.
The act of bankruptcy relied upon was the respondent’s non-compliance on or before 30 April 2015 with the requirements of a bankruptcy notice served upon her on 5 January 2015 (Bankruptcy Notice).
The creditor relied upon a body of affidavit evidence which is, in my opinion, prima facie sufficient to entitle it to a sequestration order against the respondent’s estate, subject to the consideration and determination of the Notice of Opposition to Creditor’s Petition filed by the respondent on 27 November 2015 (Notice of Opposition).
There are three grounds of opposition relied upon in the Notice of Opposition, being as follows:
A)The Applicant State of New South Wales by its department NSW Department of Education wrongfully/unlawfully put the Respondent Miguela Alvarez Macatangay on the Confidential Register of people prohibited to be employed in any capacity.
B)The costs order in the Applicant’s favour that is being collected from the Respondent was obtained by fraud, collusion or miscarriage of justice.
C)The Respondent Miguela Alvarez Macatangay does not owe the money claimed by the Applicant NSW Department of Education.
In support of her Notice of Opposition the respondent relied upon three affidavits sworn by her, although she only referred me to parts of her first affidavit, being that of 27 November 2015.
It is now necessary for me to set out the relevant factual background.
Background History
On 19 July 1999 the respondent commenced employment with the NSW Department of Education (Department) as a permanent teacher of mathematics on probation.
On 4 September 2002 the respondent commenced a proceeding under s.84 of the Industrial Relations Act 1996 (NSW) in the Industrial Relations Commission of New South Wales (IRC) for relief in relation to her threatened dismissal by the Department (s.84 proceeding).
Then, by a letter dated 29 November 2002, the Department did dismiss the respondent by annulling her appointment as a permanent teacher on probation as and from 6 December 2002 under s.48(2)(b) of the Teaching Services Act 1980 (NSW), which entitled the Director-General of Education, during a teacher’s period of probation, to annul the appointment.
The respondent’s s.84 proceeding was set down for five days final hearing in late March 2003.
However, that final hearing was vacated and never eventuated because on 25 June 2004 the respondent’s s.84 proceeding was dismissed by Mr Commissioner McDonald, on the basis that it had been settled during negotiations which took place during the fortnight before the scheduled final hearing, resulting in a binding settlement being reached on 21 March 2003: see Macatangay v NSW Department of Education & Training [2004] NSWIRComm 1043 (25 June 2004).
Commissioner McDonald held that the fundamental substance of the settlement was to the effect that the Department would rescind its annulment of the respondent’s employment, provided the respondent tendered at the same time her resignation from the Department effective from the same date as the annulment. The Department would then accept that resignation and not take action to place the respondent’s name on the confidential list of staff not to be employed by the Department in government schools or TAFE NSW (Confidential List), provided also that the respondent in exchange furnished to the Department a written undertaking not to seek employment as a teacher with the Department itself in government schools, but such undertaking not to extend to employment by TAFE NSW. The practical effect of this settlement would have been to allow the respondent to apply for employment with TAFE NSW without impediment and private schools without the blot of dismissal from the Department.
The respondent then resiled from the settlement some time after 21 March 2003 and hence the necessity for Commissioner McDonald to determine, after a contested hearing, whether or not her s.84 proceeding had been settled, as he in fact did.
Leave to appeal from Commissioner McDonald’s finding that the matter had settled was refused by a Full Bench of the IRC on 28 February 2005: see Macantangay v New South Wales Department of Education and Training [2005] NSWIRComm 69.
Nevertheless, the respondent has since continued to refuse to accept that her proceeding against the Department in the IRC was settled and she has never proffered her resignation from the Department and, therefore, she continues to remain on the Confidential List of persons not to be employed by the Department in any teaching capacity.
On 24 March 2005 the respondent commenced a proceeding in the Supreme Court of NSW against the creditor (the 2005 proceeding) in which, by a Further Amended Statement of Claim filed 15 February 2006, she claimed damages, exemplary damages and aggravated damages in negligence against the creditor and also complained that the Department had placed her name onto the Confidential List.
The creditor then moved in the Supreme Court to dismiss the 2005 proceeding as an abuse of process and an attempt to relitigate a matter that had settled.
On 9 February 2007 Grove J, pursuant to r.13.4 of the Uniform Civil Procedure Rules 2005 (NSW), dismissed the 2005 proceeding as an abuse of process and on the basis that the respondent was estopped from maintaining the 2005 proceeding: see Macantangay v New South Wales [2007] NSWSC 57.
Thereafter the respondent has brought numerous applications in the Supreme Court of NSW, the NSW Court of Appeal and the High Court of Australia seeking to call into question the correctness of Grove J’s decision to dismiss the 2005 proceeding. Ultimately in Macantangay v New South Wales [2012] NSWCA 108 (16 April 2012), the Court of Appeal made an order restraining the respondent from making any further applications relating to the 2005 proceeding without the leave of that Court. The history of the respondent’s repeated attempts to impugn the judgment of Grove J are set out by the Court of Appeal in its judgment.
However, undeterred by this restraining order, the respondent subsequently applied to the Court of Appeal to set it aside. It is convenient to reproduce the Court of Appeal’s recitation in Macatangay v New South Wales [2013] NSWCA 237 (29 July 2013) of the history of the litigation in the Supreme Court per Sackville AJA (agreed in by Macfarlan JA and Leeming JA) at ([19]) and ([29]-[38]):
19. The applicant’s repeated attempts to re-litigate issues decided adversely to her long ago illustrate the great difficulty the legal system often has in bringing litigation to an end where an unsuccessful party adamantly and obdurately refuses to accept the outcome. The history of the proceedings up to and including April 2012 is recounted in two judgments of the court: Macatangay v New South Wales (Unreported, 20 September 2010) and Macatangay v New South Wales [2012] NSWCA 108 (“April 2012 Judgment”). I shall return to some of that history later.
…
29. As this court pointed out in its judgment of 15 November 2012, Grove J in 2007 dismissed the proceedings brought by the applicant against the State as an abuse of the process of the court: Macatangay v New South Wales [2007] NSWSC 57. An application for leave to appeal was dismissed by this court on 8 November 2007: Macatangay v New South Wales (Unreported, 8 November 2007).
30. On 12 or 13 November 2007, the applicant filed a notice of motion seeking to set aside the orders made by Grove J on the ground that they were obtained by fraud. That motion was dismissed on 22 November 2007 by Harrison AsJ: Macatangay v New South Wales (Unreported, 22 November 2007). Her Honour also restrained the applicant from making any further applications in the Matter without the leave of the court. Her Honour’s judgment indicates that the motion to set aside the judgment on the grounds of fraud was clearly instituted without any reasonable grounds for doing so.
31. On 1 May 2008, this Court refused leave to appeal from the decision of Harrison AsJ: Macatangay v New South Wales (Unreported, 1 May 2008). Mason P (with whom Handley AJA agreed) said that the applicant had advanced no arguable case for concluding that Harrison AsJ had erred or that the orders made by Grove J should be disturbed.
32. The applicant subsequently purported to appeal as of right from the decision of Grove J. This appeal was struck out as incompetent on 4 September 2009. The court also refused leave to the applicant to appeal from Grove J’s decision: Macatangay v New South Wales (No 2) [2009] NSWCA 272. The court said that the applicant had failed to establish any grounds that would justify it differing from the decision of a differently constituted court 22 months earlier to refuse the applicant leave to appeal. The judgment of the court makes it clear that the second application for leave to appeal was instituted or pursued without reasonable grounds.
33. The applicant filed a further notice of motion on 14 August 2008 in the Supreme Court. She sought orders, inter alia, setting aside the judgment of Grove J. This application was dismissed by Harrison J on 27 August 2008: Macatangay v New South Wales (Unreported, 27 August 2008). It, too, was clearly instituted and pursued without reasonable grounds.
34. The applicant filed yet another motion in the Supreme Court on 14 May 2010 seeking to reopen the Matter. On 20 May 2010, Hulme J refused leave to file the motion, which was clearly hopeless.
35. In refusing the applicant’s application for leave to appeal from the decision of Hulme J, this court stated (Macatangay v New South Wales (Unreported, 20 September 2010)) that:
the proceedings presently before the Court are a clear abuse of its process and cannot possibly serve any useful purpose.
36. On 16 April 2012, this Court dismissed yet further motions by the applicant seeking to reopen the Matter. Again, a reading of the judgment shows that the motions were filed and pursued without any reasonable grounds.
37. The procedure was repeated on 21 September 2012, when yet another motion to reopen the Matter was dismissed on the papers by this court.
38. This account, which is by no means a full history of the groundless applications instituted and pursued by the applicant, shows that the Court had more than a sufficient basis for concluding on 15 November 2012 that the applicant had “frequently instituted or conducted vexatious proceedings” within the meaning of s 8(1)(a) of the VP Act. The contentions advanced by the applicant in her affidavit cast no doubt whatsoever on the conclusion reached by this Court on 15 November 2012 or the Orders made on that date.
Accordingly, the Court of Appeal dismissed the respondent’s application to set aside the restraining order made earlier by that Court in Macantangay v New South Wales [2012] NSWCA 108.
Attack on Bankruptcy Notice in Federal Court of Australia
The Bankruptcy Notice relied upon in this proceeding was, as stated above, served on the respondent on 5 January 2015. The respondent then in the Federal Court of Australia in proceeding NSD52/2015 sought to set aside the Bankruptcy Notice. On 26 February 2015 Jagot J ordered that time for compliance with the Bankruptcy Notice be extended until 30 April 2015 when the hearing before her took place, but in her judgment of 25 May 2015 she dismissed the application to set it aside.
In her judgment in Macatangay v New South Wales [2015] FCA 495 Jagot J recited the history of the litigation in the Supreme Court and recorded that it was submitted on the respondent’s behalf that Jagot J should “go behind” not only the judgment debt, but also the original judgment of Commissioner McDonald in the IRC as to whether there was a binding settlement, as had been found by him in 2004. Jagot J noted that, in her written submissions, the respondent had submitted that there was “proof of fraud, collusion and mistake in the judgment that founded the Bankruptcy Notice”, but that this allegation of fraud was not pressed by the respondent’s legal representative at the hearing before her Honour.
In the result, Jagot J found that the respondent’s application to set aside the Bankruptcy Notice was devoid of merit and that nothing would justify undertaking this course of action, and that to do so would be contrary to the interests of justice and would undermine the critical principle of the finality of litigation.
Hearing in This Court
At the hearing before this Court on 18 March 2016, the respondent appeared in person and reverted to her allegations of fraud, collusion or miscarriage of justice.
In her oral submissions to this Court the respondent asserted that the Department had colluded in the Supreme Court with Grove J and the Court of Appeal to determine proceedings in those Courts adverse to her.
She also asserted in her written submissions that the Supreme Court applied case law and legislation that were not applicable to the decisions made, so as to give favour to the Department of Education and to give costs orders in the Department’s favour, and that she was thereby a victim of fraud, collusion and injustice. She said in her written submissions that the costs order in favour of the Department of Education was obtained by fraud, collusion and miscarriage of justice or injustice and she did not, therefore, owe the money claimed in the Petition. She alleged in her written submissions that the Supreme Court had not provided her with a proper hearing and that her contentions had not been given consideration.
Ground 1
Ground 1 (reproduced again here for the sake of convenience) of the Notice of Opposition asserts:
The Applicant State of New South Wales by its department NSW Department of Education wrongfully/unlawfully put the Respondent Miguela Alvarez Macatangay on the Confidential Register of people prohibited to be employed in any capacity.
This ground of opposition to the Petition must fail. There is no evidence or legal basis for the contention that the Department wrongfully or unlawfully placed the respondent on the Confidential List. It cannot reasonably be contended that there was any restriction on the right of the Department as an employer to place on the Confidential List persons it did not wish to employ or had found unsuitable as an employee. But for the respondent’s continued refusal to accept the settlement she could have had herself removed from the Confidential List by tendering her resignation and otherwise complying with the terms of the settlement with the Department found to have been entered into by Commissioner McDonald on or about 21 March 2005.
Ground 2
Ground 2 asserts:
The costs order in the Applicant’s favour that is being collected from the Respondent was obtained by fraud, collusion or miscarriage of justice.
There is not a skerrick of evidence which would justify any finding that the costs order in favour of the creditor was obtained by fraud, collusion or miscarriage of justice. This ground of opposition is rejected.
Ground 3
Ground 3 asserts:
The Respondent Miguela Alvarez Macatangay does not owe the money claimed by the Applicant NSW Department of Education.
This ground of opposition also fails because on the evidence before the Court it is clear that the respondent does owe the money claimed by the creditor pursuant to a judgment debt of the Supreme Court of New South Wales.
Conclusion
In my opinion, all three grounds of opposition raised by the respondent to the Petition must fail.
Further, I see no other grounds or basis for going behind any of the judgments impugned by the respondent and I am fortified in that opinion by the decision of Jagot J (see paragraphs 22 and 23 above), who has already considered the same circumstances in the earlier application by the respondent before her Honour seeking to set aside the Bankruptcy Notice, particularly where her Honour found it would be contrary to the interests of justice and would undermine the critical principle of finality of litigation to do so.
I also do not consider that there is any “other sufficient cause” why a sequestration ought not to be made for the purposes of s.52(2)(b) of the Bankruptcy Act 1966 (Cth).
It should be recorded that the respondent asserted that she had a cause of action against the Department of Education resulting from her placement on the Confidential List which would result in damages exceeding the amount of the debt alleged to be owing in the Petition. However, she made no attempt to establish that the quantum of such damages, as at the date of the hearing before me or at any other particular time, would exceed the amount of $100,679.39: Patane v Asteron Life Ltd (formerly Royal & Sun Alliance Financial Services Ltd) [2004] FCA 232 at ([74]-[76]). Such a claim also, far from being one that she could not have set up in the proceeding dismissed by Grove J, was in fact a claim made by her as part of that dismissed proceeding.
In my opinion there are no proper grounds of opposition to the Petition. The petitioning creditor has established its entitlement to a sequestration order and, accordingly, I make the following orders:
(1)A sequestration order be made against the estate of Miguela Alvarez Macatangay.
(2)The applicant creditor’s costs, including any reserved costs, be taxed and paid from the bankrupt estate of Miguela Alvarez Macatangay.
(3)A copy of this sequestration order be given to the Official Receiver in Sydney within two days.
(4)The Court Notes that the date of the act of bankruptcy is 30 April 2015.
(5)The Court Notes that a consent to act as joint and several trustees of the bankrupt estate of Miguela Alvarez Macatangay has been signed by the registered trustees, Messrs Jason Lloyd Porter and Terry Grant van der Velde.
I certify that the preceding thirty-eight (38) paragraphs are a true copy of the reasons for judgment of Judge Dowdy
Associate:
Date: 27 May 2016
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