The Tubby Trout Pty Ltd v Sailbay Pty Ltd
[1996] FCA 128
•22 FEBRUARY 1996
CATCHWORDS
PRACTICE AND PROCEDURE - judgments and orders - enforcement of orders - orders for oral examination and discovery in aid of execution - applicability of Rules of the Supreme Court of Queensland to Federal Court Rules.
PRACTICE AND PROCEDURE - judgments and orders - charging orders - unascertained sum - untaxed costs.
Federal Court of Australia Act 1976 ss 4 and 53
Federal Court Rules O 37 r 7, O 47 r 33, O 62 rr 2, 4,
O 37 rr 7, 8
Guthrie v Robertson [1987] 13 FCR 336
Wilkie v Wilkie and McCalla [1905] VR 104
THE TUBBY TROUT PTY LTD & ORS v SAILBAY PTY LTD & ORS
No. QG 14 of 1989
SPENDER J
BRISBANE
22 FEBRUARY 1996
IN THE FEDERAL COURT OF AUSTRALIA )
QUEENSLAND DISTRICT REGISTRY ) No. QG 14 of 1989
GENERAL DIVISION )
BETWEEN: THE TUBBY TROUT PTY LTD
First Applicant
AND: DAVID MARSDEN McINTYRE and CATHRYN MARY McINTYRE
Second Applicants
AND: SAILBAY PTY LTD
First Respondent
AND: ANTHONY JOHN WHITE
Second Respondent
AND: ROBERT DUNCAN McCRAE, MARCUS ROY FORD and CHRISTOPHER HARDY GASTEEN
Third Respondents
CORAM: Spender J
PLACE: Brisbane
DATE: 22 February 1996
MINUTES OF ORDER
THE COURT ORDERS THAT:
(1)that the second applicants attend and be orally examined before an officer of the court as to whether any and what debts are owing to them and whether the second applicants have any or what property or other means of satisfying the costs order granted in favour of the third respondents against the second applicants.
(2)that the second applicants produce the following books, deeds, papers or writing:
Full documentation in relation to ownership of any real estate, motor vehicles, or other personal property including details of any encumbrances on same, valuation certificates etc., banking records including savings, cheque accounts, savings bonds, shares etc. with the balance detailed, current bank statements, updated bank books, share certificates etc., details of any wage, salary, commissions or other income earned, tax returns for the past three financial years, insurance policies, superannuation details, details of fixed weekly commitments and any other documentation relating to their financial affairs not specifically mentioned aforesaid.
-2-
(3)that the costs of this application including reserved costs be part of the third respondents' costs in the principal proceedings.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA )
QUEENSLAND DISTRICT REGISTRY ) No. QG 14 of 1989
GENERAL DIVISION )
BETWEEN: THE TUBBY TROUT PTY LTD
First Applicant
AND: DAVID MARSDEN McINTYRE and CATHRYN MARY McINTYRE
Second Applicants
AND: SAILBAY PTY LTD
First Respondent
AND: ANTHONY JOHN WHITE
Second Respondent
AND: ROBERT DUNCAN McCRAE, MARCUS ROY FORD and CHRISTOPHER HARDY GASTEEN
Third Respondents
CORAM: Spender J
PLACE: Brisbane
DATE: 22 February 1996
REASONS FOR JUDGMENT
By a notice of motion filed on 22 December 1995 in proceedings which were heard in the Federal Court some years ago, the third respondents, Robert Duncan McCrae, Marcus Roy Ford and Christopher Hardy Gasteen, applied for orders that David Marsden McIntyre and Cathryn Mary McIntyre attend and be orally examined before a Judge or an Officer of the Court as to whether any and what debts are owing to them and whether they have any and what property or other means of satisfying the costs order granted in favour of the third respondent against the second applicants, including the costs of this application.
The application further sought:
"That the Second Applicants produce the following books deeds, papers or writings:
Full documentation in relation to ownership of any real estate, motor vehicles, or other personal property including details of any encumbrances on same, valuation certificates etc., banking records including savings, cheque accounts, savings bonds, shares etc. with the balance detailed, current bank statements, updated bank books, share certificates etc., details of any wage, salary, commissions or other income earned, tax returns for the past three financial years, insurance policies, superannuation details, details of fixed weekly commitments and any other documentation relating to their financial affairs not specifically mentioned aforesaid. "
The matter came before me on 13 February 1996, and having regard to the fact that there were issues which the application seemed to me to raise, I then ordered that the matter be adjourned until today and that the third respondents serve their notice of motion and supporting affidavits on Mr and Mrs McIntyre by ordinary post in sufficient time for them to have notice of the application.
Today Ms Kearney of Minter Ellison appears for the third respondents to pursue the relief sought in the motion and Mr Treherne of Mark Treherne and Associates appears for Mr and Mrs McIntyre to resist the making of the orders sought by the notice of motion.
What has happened is this. The first applicant, Tubby Trout Pty Ltd, a company with which the second applicants, Mr and Mrs McIntyre, were concerned, had brought proceedings against Sailbay Pty Ltd as first respondent, Anthony John Wyatt as second respondent, and the third respondents.
On 14 January 1994, Drummond J dismissed the first and second applicants' action against the third respondents, although he ordered the first and second respondents to pay a money sum to the applicants.
On 8 February 1994, Drummond J ordered that the first and second applicants pay the third respondents' costs to be taxed.
The affidavit evidence suggests that the third respondents have spent considerable sums (the claim being in the order of $70,000) by way of costs, but have not had the costs order made by Drummond J taxed. It is said that they have not had their costs taxed because they were unsure whether the second applicants would be able to pay their costs and they did not wish to incur unrecoverable costs.
Section 4 of the Federal Court of Australia Act 1976 provides:
"'judgment' means a judgment, decree or order, whether final or interlocutory, or a sentence; "
Section 53 of the Federal Court of Australia Act provides:
"(1) Subject to the Rules of Court, a person in whose favour a judgment of the Court is given is entitled to the same remedies for enforcement of the judgment in a State or Territory, by execution or otherwise, as are allowed in like cases by the laws of that State or Territory to persons in whose favour a judgment of the Supreme Court of that State or Territory is given.
(2) This section does not affect the operation of any provision made by or under any other Act or by the Rules of Court for the execution and enforcement of judgments of the Court. "
Order 37 r 7 of the Federal Court Rules relevantly provides:
"(1) Subject to the Rules, and without limiting any other means of enforcement which may be available, the Court may, in order to enforce a judgment or order of the Court, make any order, issue any writ or take any other step that could be made, issued or taken by the Supreme Court of the State or Territory in which the judgment or order is to be enforced if the judgment or order had been made by that Supreme Court.
(2) The modes of procedure and forms of process of the Supreme Court of the State or Territory in which the judgment or order is sought to be enforced shall be available and followed in the Court so far as is practicable..."
And Order 37 r 8 provides:
"A party interested in the execution or enforcement of an order may apply to the Court ex parte for directions as to its execution or enforcement. "
Order 47 r 33 of the Supreme Court Rules of Queensland provides:
"When a judgment or order is given or made for the payment of money, the party entitled to enforce it may apply ex parte to the Court or a Judge for an order that the debtor liable under such judgment or order, or, in the case of a corporation or company, or other body of persons empowered by law to sue or be sued, whether in its own name or in the name of any officer or other person, that any officer thereof be orally examined before a Judge or an officer of the Court as the Court or Judge may appoint, as to whether any and what debts are owing to the debtor, and whether the debtor has any and what other property or means of satisfying the judgment or order; and the Court or Judge may make an order for the attendance and the examination of such debtor, or of such officer, and for the production by him or her of any books or documents. "
In Guthrie v Robertson [1987] 13 FCR 336, I held that the Federal Court could exercise the power contained in O 7 r 33 of the Rules of the Supreme Court of Queensland to order attendance and oral examination by reason of the application of s 53 of the Federal Court of Australia Act and O 37 r 7 of the Federal Court Rules. In that particular case, however, the defendant had not paid fines imposed and costs awarded against him. The application was that he be orally examined concerning his property and means of satisfying the judgment.
Three grounds are advanced as to why I ought not grant the orders sought by the notice of motion. The first is directed to the jurisdiction of the Court.
It was submitted that O 37 r 7 commences with the words "Subject to the Rules"; and further, that the discretion
that is conferred by those rules is premised on the object expressed in O 37 r 7, namely, that the discretion of the Court is to be exercised "in order to enforce a judgment or order of the Court".
The reference "Subject to the Rules" was submitted to direct attention to O 62 r 2 which provides:
"The provisions of this Order apply to costs payable or to be taxed under any order of the Court, or under the Rules, and costs to be taxed in the Court under any Act. "
And O 62 r 4 which provides:
"Subject to this Order, where by or under these Rules or any order of the Court costs are to be paid to any person, that person shall be entitled to his taxed costs. "
The effect of the latter rule was said to be that unless costs are taxed, there is no entitlement to them. I do not agree. Order 62 r 4 establishes that the entitlement by any person, as a consequence of the order of the costs, is an entitlement to those costs as they are taxed. It is directed at quantifying the amount of the entitlement.
As to the second phrase in O 37 r 7 going to the claimed absence of jurisdiction, it was simply submitted that this application is for the oral examination of Mr and Mrs McIntyre. It is, at best, a step preparatory to enforcing a judgment or order or in aid of the enforcing of a judgment or order but it does not properly fall to be described as a step done "in order to enforce a judgment or order of the Court".
This submission, in my view, takes too narrow a view of the nature of the relief claimed by the notice of motion. In my opinion, the words "in order to enforce a judgment or order of the Court" directs attention to the purpose for which the application is sought and, in my opinion, an application for an oral examination to ascertain what property, if any, a party has to satisfy a costs order is a matter done "in order to enforce a judgment or order of the Court". I am therefore of the view that the Court has jurisdiction to consider whether to grant the relief sought in the notice of motion.
The second basis has already been touched on and that deals with the absence of taxation. In Wilkie v Wilkie and McCalla [1905] VR 104, Hood J, in relation to provisions of the Rules of the Supreme Court of Victoria, not in any material respect different from that of the present Rules of the Supreme Court of Queensland, held that costs which were not taxed, nonetheless, were a judgment or order for the recovery or payment of a sum of money owing, which rendered the debtor liable to be examined. He held that costs were a debt and that an action may be maintained for them before taxation. He directed that the defendant be examined pursuant to the Rules of the Supreme Court of Victoria.
Consistent with that decision, in my opinion, the fact that the costs have not been as yet taxed does not prevent the costs constituting a debt so as to render Mr and Mrs McIntyre liable to be orally examined.
The third matter goes to the Court's discretion. The primary basis relied on here is the fact of delay. The order by Drummond J for the payment of costs to be taxed to the third respondents by the first and second applicants was made on 8 February 1994. However, an appeal seeking to displace the money order ordered to be paid to the first and second applicants by other parties in the proceedings was not disposed of until 7 November 1994, and it seems to me that it was not unreasonable to consider whether the applicants might retain the benefit of the money order which Drummond J had ordered in their favour.
In respect of the period from November 1995 until this application was lodged approximately 12 months later, the material suggests that inquiries were made through commercial agents for the purpose of ascertaining whether and to what extent Mr and Mrs McIntyre had assets. The material is a bit thin in respect of this aspect of the matter but, in my opinion, it cannot be suggested that there has been any prejudice suffered by Mr and Mrs McIntyre by the failure to tax the costs or to bring this application sooner than it was brought.
I think it is in everyone's interests and also conducive to a possible saving in costs if I were to order that Mr and Mrs McIntyre be orally examined as to their property, and to that end it seems to me also I should make
the order concerning the production of documents sought in the notice of motion.
In those circumstances, I order:
that the second applicants attend and be orally examined before an officer of the court as to whether any and what debts are owing to them and whether the second applicants have any or what property or other means of satisfying the costs order granted in favour of the third respondents against the second applicants.
that the second applicants produce the following books, deeds, papers or writings:
Full documentation in relation to ownership of any real estate, motor vehicles, or other personal property including details of any encumbrances on same, valuation certificates etc., banking records including savings, cheque accounts, savings bonds, shares etc. with the balance detailed, current bank statements, updated bank books, share certificates etc., details of any wage, salary, commissions or other income earned, tax returns for the past three financial years, insurance policies, superannuation details, details of fixed weekly commitments and any
other documentation relating to their financial affairs not specifically mentioned aforesaid.
I order that the costs of this application including reserved costs be part of the third respondents' costs in the principal proceedings.
I certify that this and the preceding nine (9) pages are a true copy of the reasons for judgment herein of the Honourable Justice Spender.
Associate
Date: 22 February 1996
Solicitors for the first and
second applicants : Mark Treherne & Assoc.
Solicitors for the third respondents : Minter Ellison
Date of Hearing : 22 February 1996
2
0
0