KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ
JUDITH GAIL TALACKO (AS APPOINTED REPRESENTATIVE OF THE ESTATE OF JAN EMIL TALACKO) APPELLANT
AND
ALEXANDRA BENNETT & ORS RESPONDENTS
Talacko v Bennett
[2017] HCA 15
3 May 2017
M154/2016
ORDER
1.Appeal allowed.
2.Set aside orders 2 to 6 of the Court of Appeal of the Supreme Court of Victoria made in proceeding S APCI 2016 0024 on 28 July 2016 and, in their place, order that:
(a) the appeal to the Court of Appeal of the Supreme Court of Victoria be dismissed; and
(b) the applicants pay the first respondent's costs in proceeding S APCI 2016 0024.
3.The first to third respondents pay the appellant's costs of the appeal to this Court.
On appeal from the Supreme Court of Victoria
Representation
B W Walker SC with J B Masters for the appellant (instructed by Strongman & Crouch)
P H Solomon QC with O M Ciolek for the first to third respondents (instructed by Brand Partners)
Submitting appearance for the fourth respondent
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Talacko v Bennett
Procedure – Enforcement of Australian judgment debt in foreign jurisdiction – Where respondents obtained certificate under s 15(1) of Foreign Judgments Act 1991 (Cth) certifying finality of Australian judgment – Where application for such certificate may not be made until expiration of any stay of enforcement of judgment in question – Where judgment debtor bankrupt – Whether certificate valid – Whether s 58(3) of Bankruptcy Act 1966 (Cth) operated to impose a stay of enforcement for purposes of Foreign Judgments Act 1991 (Cth).
Words and phrases – "enforcement by execution", "stay of enforcement of the judgment".
KIEFEL CJ, BELL, KEANE, GORDON AND EDELMAN JJ. At issue in this appeal is whether s 15(2) of the Foreign Judgments Act1991 (Cth) ("the Foreign Judgments Act") prevents a judgment creditor of a bankrupt from obtaining a certificate under that Act to facilitate the enforcement of the judgment in a foreign jurisdiction. In particular, the issue is whether a "stay of enforcement" of a judgment within the meaning of s 15(2) of the Foreign Judgments Act is brought about by s 58(3) of the Bankruptcy Act1966 (Cth) ("the Bankruptcy Act").
The Court of Appeal of the Supreme Court of Victoria held, by majority, that s 15(2) of the Foreign Judgments Act did not prevent the issue of a certificate even though the judgment in question could not be enforced by execution by reason of s 58(3) of the Bankruptcy Act[1]. In so holding, the Court of Appeal erred in its understanding of the operation of s 15(2) of the Foreign Judgments Act. Accordingly, the appeal must be allowed.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Talacko v Bennett [2017] HCA 15
Case
[2017] HCA 15
Decision Date
CaseChat Overview and Summary
The High Court of Australia considered an appeal concerning the validity of a certificate issued under section 15(1) of the *Foreign Judgments Act 1991* (Cth). The dispute arose from an Australian judgment debt owed by the appellant, who was bankrupt, to the respondents. The respondents had obtained a certificate from an Australian court certifying the finality of the judgment, which they intended to use to enforce the judgment in a foreign jurisdiction.
The central legal issue before the High Court was whether a certificate issued under section 15(1) of the *Foreign Judgments Act 1991* (Cth) was valid when the judgment debtor was bankrupt. Specifically, the Court had to determine if section 58(3) of the *Bankruptcy Act 1966* (Cth), which operates to stay the enforcement of judgments against a bankrupt, constituted a "stay of enforcement of the judgment" for the purposes of section 15(2) of the *Foreign Judgments Act 1991* (Cth). Section 15(2) prohibits an application for a certificate under section 15(1) until any stay of enforcement has expired.
The High Court reasoned that section 58(3) of the *Bankruptcy Act 1966* (Cth) imposes a statutory stay on the enforcement of judgments against a bankrupt, irrespective of whether the judgment creditor has taken any steps to enforce the judgment. This statutory stay is a "stay of enforcement of the judgment" for the purposes of section 15(2) of the *Foreign Judgments Act 1991* (Cth). Consequently, an application for a certificate under section 15(1) cannot be made while the judgment debtor remains bankrupt, as the statutory stay remains in effect. The Court allowed the appeal, set aside the orders of the Court of Appeal of the Supreme Court of Victoria, and dismissed the respondents' appeal to that court.
Orders
Orders of the court
1. Appeal allowed.
2. Set aside orders 2 to 6 of the Court of Appeal of the Supreme Court of Victoria made in proceeding S APCI 2016 0024 on 28 July 2016 and, in their place, order that:
(a) the appeal to the Court of Appeal of the Supreme Court of Victoria be dismissed; and
(b) the applicants pay the first respondent's costs in proceeding S APCI 2016 0024.
3. The first to third respondents pay the appellant's costs of the appeal to this Court.
Background
Background to the litigation
While the issue on which the appeal turns is within short compass, a summary of the circumstances which gave rise to the issue is, unavoidably, as lengthy as it is sad.BackgroundThe parties and the properties Before World War II, Anna and Alois Talacko ("Anna and Alois") resided in what was then Czechoslovakia. They owned several properties, including five properties in the centre of Prague, 0.8 hectares of land in suburban Kbely, 17.44 hectares of land on the outskirts of Prague at Řepy, a 368 hectare private forest plantation at Sucha, Slovakia, and an apartment building and adjacent vacant land in Dresden, Germany[2]. After World War II, the properties were seized by and vested in the state, both in Czechoslovakia and in East Germany. Anna and Alois left Europe and settled in Australia[3]. [2]Bennett v Talacko [2016] VSCA 179 at [121].[3]Bennett v Talacko [2016] VSCA 179 at [122]. Anna and Alois had three children: Jan Emil Talacko ("Jan Emil"), Peter Talacko ("Peter") and Helena Talacko ("Helena")[4]. [4]Bennett v Talacko [2016] VSCA 179 at [123]. Jan Emil was married to Judith Talacko ("Judith"), and they had four children, including two sons: David Talacko ("David") and Paul Talacko ("Paul")[5]. [5]Bennett v Talacko [2016] VSCA 179 at [124]. Peter was married to Margaret Talacko ("Margaret"), and they had three children: Alexandra Bennett ("Alexandra"), Martin Talacko ("Martin") and Rowena Talacko ("Rowena")[6]. [6]Bennett v Talacko [2016] VSCA 179 at [125]. Helena had two children: Anna Talacko and Jan Talacko ("Jan")[7]. [7]Bennett v Talacko [2016] VSCA 179 at [63]. Alois and Anna died in Melbourne, in 1964 and 1984 respectively[8]. [8]Bennett v Talacko [2016] VSCA 179 at [126]. After the end of Communist rule in Czechoslovakia in 1989, Jan Emil, Peter and Helena became interested in reclaiming their deceased parents' properties[9]. In September 1991, Jan Emil applied for restitution of five properties in central Prague. At that time, only a resident and citizen of what had become the Czech Republic could make such a claim. Jan Emil satisfied these requirements, while Peter and Helena did not. In March 1992, the five Prague properties were restored to Jan Emil, either wholly or in part[10].[9]Bennett v Talacko [2016] VSCA 179 at [128].[10]Bennett v Talacko [2016] VSCA 179 at [130]. Helena and the wife and children of Peter (who died in 1995) subsequently alleged that the three siblings had reached an agreement to pursue the restitution of the properties together, and to share the proceeds equally. Jan Emil denied making such an agreement[11]. [11]Bennett v Talacko [2016] VSCA 179 at [127], [129].The 1998 Proceeding On 2 October 1998, Peter's three children and his sister, Helena, commenced proceedings in the Supreme Court of Victoria ("the 1998 Proceeding") against Jan Emil, with Peter's widow and executrix, Margaret, subsequently added as a fifth plaintiff[12]. They sought equitable relief against Jan Emil on the basis that it had been agreed in March 1991 that the three children of Anna and Alois would share equally in the benefit of the properties[13]. [12]Bennett v Talacko [2016] VSCA 179 at [132].[13]Bennett v Talacko [2016] VSCA 179 at [132].
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
KIEFEL CJ, BELL, KEANE, GORDON AND EDELMAN JJ
GAGELER J
NETTLE J
Before proceeding to a consideration of the determination of this issue by the courts below, it is convenient to set out the material provisions of the legislation which bear upon it.Foreign Judgments Act The Foreign Judgments Act enables a judgment creditor to obtain a certificate from the Australian court which has rendered the judgment, in order to facilitate the enforcement of the judgment by the courts of a foreign legal system. Section 15 of the Foreign Judgments Act relevantly provides: "(1)Subject to this section, where an application is duly made by a judgment creditor who wishes to enforce in a country a judgment that has been given in an Australian court, the Registrar of the court must issue to the judgment creditor:(a)a certified copy of the judgment; and(b)a certificate with respect to the judgment containing such particulars, including:(i)the causes of action to which the judgment relates; and(ii)the rate of interest (if any) payable on any amount payable under the judgment;as are prescribed by the regulations or by Rules of Court.(2)An application may not be made until the expiration of any stay of enforcement of the judgment in question." Importantly, s 3(1) of the Foreign Judgments Act provides that, unless the contrary intention appears, "enforcement" means "where there is an amount of money payable under the judgment, enforcement by execution". Insofar as the enforcement of the judgment for payment of an amount of money by way of equitable compensation is concerned, enforcement means "enforcement by execution" of the rights conferred by the judgment. Part 2 of the Foreign Judgments Act – entitled "Reciprocal enforcement of judgments" – "establishes a regime for the registration and enforcement of judgments of foreign courts" in Australia[36]. Its operation is premised on there being "substantial reciprocity of treatment" in relation to the enforcement in a particular foreign country of "money judgments given in all Australian superior courts"[37]. If the Governor-General is satisfied that such treatment will be assured in the event that Pt 2 is applied to money judgments given in the superior courts of the foreign country, then regulations may be made extending the operation of Pt 2 to that foreign country[38]. [36]PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 89 ALJR 975 at 980 [20]; 325 ALR 168 at 174; [2015] HCA 36.[37]Section 5(1) of the Foreign Judgments Act. See PT Bayan (2015) 89 ALJR 975 at 980 [21]; 325 ALR 168 at 174. See also s 5(3) of the Foreign Judgments Act.[38]Section 5(1) of the Foreign Judgments Act. Section 15 is contained in Pt 3 – "Miscellaneous". Section 15(1) facilitates the reciprocal treatment upon which Pt 2 hinges by enabling a judgment creditor who "wishes to enforce", in a foreign jurisdiction, a judgment given in an Australian court to obtain a certified copy of the judgment and a certificate with respect to that judgment. As is plain from the requirement that only a judgment creditor who wishes to enforce an Australian judgment in a foreign country can make an application under s 15(1), the purpose of those documents being issued is to enable a judgment creditor to rely on them in a foreign court to enforce the Australian judgment in a foreign country.
Ratio Decidendi
Legal Principle Established
Established by:
KIEFEL CJ, BELL, KEANE, GORDON AND EDELMAN JJ,
GAGELER J,
NETTLE J