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Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 1
FEDERAL CIRCUIT COURT OF AUSTRALIA
LEDGER ACQUISITIONS AUSTRALIA MB PTY LTD v KIEFER
[2014] FCCA 2216
Catchwords: BANKRUPTCY – Application for review of Registrar’s decision – sequestration order – whether Bankruptcy Act 1966 (Cth) valid – whether Federal Circuit Court of Australia has jurisdiction in bankruptcy – whether power to make sequestration order – whether Registrar has delegated power to make sequestration order – the effect of Magna Carta – the effect of the writ of habeas corpus – trial by jury. COURTS AND JUDGES – Validity of the Federal Circuit Court of Australia Act 1999 (Cth) – validity of establishment of Federal Circuit Court of Australia – validity of appointments of Judges and Registrars – exercise of judicial power of the Commonwealth. COURTS AND JUDGES – Whether Federal Circuit Court of Australia has jurisdiction in bankruptcy – whether power to make sequestration order – the effect of Magna Carta – the effect of the writ of habeas corpus – trial by jury. STATUTES – Validity of Commonwealth legislation – whether Governor-General’s assent to various legislation valid – nature of proof of assent required. COSTS – Indemnity costs – whether proper case for indemnity costs – factors for consideration. Legislation: Acts Interpretation Act 1901 (Cth), ss.2B, 5(1), 6 Bankruptcy Act 1966 (Cth), ss.27(1), 30(3), 43(1), 52(1) Constitution, ss.2, 4, 51(ii) and (xvii), 71, 80 Courts and Tribunals Legislation Amendment (Administration) Act 2013 (Cth) Crimes Act 1914 (Cth), s.24F(1) Evidence Act 1995 (Cth), s.143(1) and (2) Family Law Act 1975 (Cth) Federal Circuit Court (Bankruptcy) Rules 2006 (Cth), rr.1.01, 1.02, 1.02A, 1.03(1), 2.02, 2.03(1), Schedule 2, Items 5 and 9 Federal Circuit Court of Australia Act 1999 (Cth), ss.5, 10(1), 11, 53, 81(1), 102(2), 104(2) and (3) Federal Circuit Court of Australia (Consequential Amendments) Act 2013 (Cth) Federal Circuit Court of Australia Legislation Amendment Act 2012 (Cth)
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 2
Federal Circuit Court Rules 2001 (Cth), rr.13.01(2)(b), 13.03C(1)(c) Federal Court of Australia Act 1976 (Cth), ss.39, 40 Federal Magistrates Act 1999 (Cth), s.2 Federal Magistrates (Consequential Amendments) Act 1999 (Cth), ss.2, 3, Sch.7, Items 2, 3, 4, 5, 6 and 7 Immigration Restriction Act 1901 (Cth) Legislative Instruments Act 2003 (Cth), s.20 Magna Carta Act 1297 (UK), 25 Edw 1, cl.29 Cases cited: Re Stanbridge’s Application (1996) 70 ALJR 640 Arnold & Anor v State Bank of South Australia & Ors (1992) 38 FCR 484 Attorney-General of The Commonwealth v Foster (1999) 84 FCR 582 Bahonko v Nurses Board of Victoria [2008] FCAFC 29 Baker & Ors v Commonwealth (2012) 206 FCR 229; [2012] FCAFC 121 Cheesman & Ors v Waters & Anor (1997) 77 FCR 221 Cheng v The Queen (2000) 203 CLR 248; [2000] HCA 53 Chia Gee & Ors v Martin (1905) 3 CLR 649 Cirillo v Consolidated Press Property Ltd (formerly known as Citicorp Australia Limited) (No. 2) [2007] FCA 179 Colgate-Palmolive Company & Anor v Cussons Pty Limited (1993) 46 FCR 225 Commonwealth Bank of Australia v Heinrich [2000] FCA 1255 Commonwealth Bank of Australia v Rigg [2001] FCA 590 Ex parte Walsh and Johnson; in re Yates (1925) 37 CLR 36 Fisher & Anor v Westpac Banking Corporation & Ors (unreported, Federal Court, No 624/92, 18 August 1992) Fortron Automotive Treatments Pty Ltd v Jones & Ors (No. 4) (2011) 254 FLR 303; [2011] FMCA 854 Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd & Ors (1988) 81 ALR 397 Gargan v Commonwealth Bank of Australia [2004] FCA 641 Gargan v Kippin Investments Pty Ltd [2008] FCA 1718 Genovese v BGC Construction Pty Ltd (No. 2) [2007] FMCA 601 Harding v Deputy Commissioner of Taxation (2008) 172 FCR 206; [2008] FCA 1403 Harris v Caladine (1991) 172 CLR 84 Hubner v ANZ (1999) 88 FCR 445; [1999] FCA 385 Hubner v ANZ (2000) 101 FCR 71; [2000] FCA 140 Insurance Commissioner v Australian Associated Motor Insurer Ltd (1982) 65 FLR 172 Kingswell v The Queen (1985) 159 CLR 264 Kowalski v Chief Executive Officer of Medicare Australia (2010) 185 FCR 42; [2010] FCA 413 Le v McElwee [2008] ACTSC 55 Pattison v Hadjimouratis (2006) 155 FCR 226; [2006] FCAFC 153
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 3
R v Davison (1954) 90 CLR 353 Re Bryant & Anor; Ex parte Guarino (2001) 178 ALR 57; [2001] HCA 5 Roy Galvin & Co Pty Ltd v Ives [2013] FCCA 1645 Simandl v Deputy Commissioner of Taxation (2008) 167 FCR 501; [2008] FCA 450 Skyring v Federal Commissioner of Taxation (1991) 23 ATR 84 Suh & Ors v Minister for Immigration & Citizenship & Anor (2009) 175 FCR 515; [2009] FCAFC 42 SZQBN v Minister for Immigration & Citizenship [2013] FCA 276 Taylor & Anor v Deputy Commissioner of Taxation (1999) 42 ATR 220; [1999] FCA 195 Totev v Sfar & Anor (2008) 167 FCR 193; [2008] FCAFC 35 M Coper, Encounters with the Australian Constitution (North Ryde: CCH Australia Ltd, 1987) Z Cowen, Isaac Isaacs, (Melbourne: Oxford University Press, 1967) BH McPherson, The Reception of English Law Abroad (Brisbane: Supreme Court of Queensland Library, 2007) C Stephenson and FG Marcham, Sources of English Constitutional History. A Selection Of Documents From A.D. 600 To The Present (New York: Harper & Brothers, 1937) Martha Rutledge, “Barton, Sir Edmund (Toby) (1849-1920)”, Australian Dictionary of Biography, Australian National University, http://adb.anu.edu.au/biography/barton-sir-edmund-toby-71/text8629 Martha Rutledge, “O’Connor, Richard Edward (Dick) (1851-1912)”, Australian Dictionary of Biography, Australian National University, http://adb.anu.edu.au/biography/oconnor-richard-edward-dick-1102/text13691 Applicant (Respondent for review):
LEDGER ACQUISITIONS AUSTRALIA MB PTY LTD (ACN 161 618 999)
Respondent (Applicant for review):
AXEL KIEFER
File Number: PEG 284 of 2013 Judgment of: Judge Antoni Lucev Hearing date: 17 March 2014 Date of Last Submission: 17 March 2014 Delivered at: Perth Delivered on: 30 October 2014
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 4
REPRESENTATION
Counsel for the Applicant: Mr S Green Solicitors for the Applicant: Havilah Legal For the Respondent: No appearance
ORDERS (made on 17 March 2014)
(1) The application for review be dismissed pursuant to r.13.03C(1)(c) of
the Federal Circuit Rules 2001 (Cth).
(2) The applicant for review pay the respondent for review’s costs in the
sum of $6985 by 17 April 2014.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 1
FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PERTH
PEG 284 of 2013
LEDGER ACQUISITIONS AUSTRALIA MB PTY LTD
(ACN 161 618 999) Applicant
And
AXEL KIEFER Respondent
REASONS FOR JUDGMENT
Application for review
1. On 19 February 2014 the respondent, the applicant for review, Axel
Kiefer, made an application for review of the making of a sequestration
order against his estate by a Registrar of this Court on 3 February 2014.
2. When the matter came on for hearing before the Court on 17 March
2014 the Court ordered that the application for review be dismissed,
and ordered that Mr Kiefer, pay the costs of the applicant, the
respondent for review, Ledger Acquisitions Australia MB Pty Ltd.1 The
Court also indicated that it would publish more detailed Reasons for
Judgment at a later time. These are those Reasons for Judgment.
1 “Ledger Acquisitions”.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 2
Sequestration order and legislative provisions of Bankruptcy Act 1966
3. On 3 February 2014, under the provisions of ss.43(1) and 52 of the
Bankruptcy Act 1966 (Cth),2 a sequestration order was made against
the estate of Mr Kiefer by a Registrar of this Court.
4. Section 27(1) of the Bankruptcy Act 1966 provides as follows:
(1) The Federal Court and the Federal Circuit Court have concurrent jurisdiction in bankruptcy, and that jurisdiction is exclusive of the jurisdiction of all courts other than:
(a) the jurisdiction of the High Court under section 75 of the Constitution; or
(b) the jurisdiction of the Family Court under section 35 or 35A of this Act.
5. Section 43(1) of the Bankruptcy Act 1966 provides as follows:
(1) Subject to this Act, where:
(a) a debtor has committed an act of bankruptcy; and
(b) at the time when the act of bankruptcy was committed, the debtor:
(i) was personally present or ordinarily resident in Australia;
(ii) had a dwelling-house or place of business in Australia;
(iii) was carrying on business in Australia, either personally or by means of an agent or manager; or
(iv) was a member of a firm or partnership carrying on business in Australia by means of a partner or partners or of an agent or manager;
the Court may, on a petition presented by a creditor, make a sequestration order against the estate of the debtor.
6. Section 52(1) of the Bankruptcy Act 1966 provides as follows:
(1) At the hearing of a creditor's petition, the Court shall require proof of:
2 “Bankruptcy Act 1966”.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 3
(a) the matters stated in the petition (for which purpose the Court may accept the affidavit verifying the petition as sufficient);
(b) service of the petition; and
(c) the fact that the debt or debts on which the petitioning creditor relies is or are still owing;
and, if it is satisfied with the proof of those matters, may make a sequestration order against the estate of the debtor.
The hearing of the sequestration order application before
the Registrar
7. The evidence of what occurred at the hearing of the sequestration order
before the Registrar is, in the absence of transcript of that hearing,
contained in the affidavit of Stephen Brian Green,3 the lawyer acting
for Ledger Acquisitions. Mr Green’s Affidavit indicates that the
following occurred at that hearing:
a) Mr Kiefer (who was apparently working in Germany) did not
appear at the hearing;
b) a Mr Schafer sought to appear at the hearing for Mr Kiefer;
c) the Registrar granted leave for Mr Schafer (who is apparently not
a lawyer) to appear, and enquired as to what he was seeking at the
hearing;
d) Mr Schafer requested that the Registrar remove himself from the
courtroom as neither the Registrar nor the Court had authority to
hear this matter;
e) Mr Schafer advised that he had High Court of Australia authority
to support his request and position, and made the statement whilst
waving some papers about;
f) the Registrar refused to listen to Mr Schafer’s submissions and
asked him to be civil and to sit down;
g) Mr Schafer refused to sit down and continued with his
submissions, talking over both the Registrar and Mr Green;
3 “Mr Green’s Affidavit” and “Mr Green” respectively.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 4
h) the Registrar then asked Mr Schafer to sit down or leave the
courtroom, or he would have him removed;
i) Mr Schafer then proceeded to leave the courtroom advising both
the Registrar and Mr Green that they would be sued for tortious
damages;
j) after Mr Schafer left the courtroom the Registrar stood the matter
down to the end of the list so that shorter matters could be dealt
with; and
k) when the matter was called back on the Registrar:
i) dismissed Mr Kiefer’s interim application for an
adjournment; and
ii) made the sequestration order against Mr Kiefer’s estate, and
an order for costs payable from Mr Kiefer’s estate.
Application for review
8. The application for review filed on 19 February 2014 by Mr Kiefer
notes that Mr Kiefer is working in Germany until May 2014, but that
“his private Representative will appear on his behalf during this time if
Appearance is required”.4
9. Mr Kiefer annexed to the application for review the details of the
matters raised before the Registrar, and the bases for them, summarised
as follows:
a) that the Registrar had no authority to sit in a bankruptcy matter;
b) the Registrar’s declining to hear the representative of Mr Kiefer,
and making orders regardless, was the commission of a “Tort” on
Mr Kiefer;
c) that under s.24F(1) of the Crimes Act 1914 (Cth)5 it was lawful to
point out in good faith errors or defects in the Constitution or in
4 Application for Review – Section D. 5 “Crimes Act 1914”.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 5
the administration of justice with a view to the reformation of
such errors;6
d) the Registrar was wrong in law and fact in refusing to allow Mr
Kiefer’s private representative (Mr Schafer) to appear on his
behalf, because Mr Kiefer had applied for an adjournment to
allow further time “to oppose the Bankruptcy Notice”;7
e) by making orders the Registrar had committed a “Tort” on Mr
Kiefer “by perverting the course of justice”;
f) the Registrar was wrong in law and fact by refusing to remove
himself from the Court “after it was pointed out to him that he
unlawfully purported himself to be an officer of the crown,
whereby he committed fraud and treason and another ‘Tort’” on
Mr Kiefer;
g) the Registrar failed to apply R v Davison,8 and thereby committed
another “Tort” on Mr Kiefer;
h) the Registrar’s “arrogance towards the information presented”,
Mr Kiefer having sent a representative rather than entering a non-
appearance, and the Registrar’s ensuing actions “constituted
breach of public and statutory duties and by interfering with the
judicial process, Judicial Misfeasance”;
i) the Bankruptcy Act 1966, and, seemingly, all other
Commonwealth Acts, have not lawfully been assented to by the
Governor-General;
j) even if the Bankruptcy Act 1966 were valid, jurisdiction in
bankruptcy matters is conferred on the Court, and not a Registrar,
and the Registrar’s action and refusal to step aside in the matter
constituted another “Tort” on Mr Kiefer;
k) the Registrar was wrong in law and fact when he made orders on
his “purported authority” whilst failing to adhere to that section
6 Mr Kiefer referred to “[s]ection 24A(2) of the Crimes Act of 1914 (as amended by Act #54 of 1920)”, but the provision containing these terms is now s.24F(1) of the Crimes Act 1914. 7 The Court notes that the Registrar was in fact hearing a creditors petition application for a sequestration order. 8 (1954) 90 CLR 353 (“Davison”).
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 6
of “Magna Carta” dealing with a person’s entitlement to lawful
judgment by their peers, and thereby the Registrar committed
another “Tort” on Mr Kiefer; and
l) the Registrar was wrong in law and fact when he made orders on
his purported authority because he failed to adhere to “Habeas
Corpus Act (1641)” in relation to a person being judged by his
peers, and that none of a person’s land, tenements, goods nor
chattels are to be seized other than in accordance with the law of
the land.9
10. Upon filing, the application for review was given a hearing time and
date of 10.15am on 17 March 2014, which time and date appear on the
face of the filed application.
Ledger Acquisitions’ preparation for hearing of the
application for review
11. In preparation for the hearing of the application for review Ledger
Acquisitions:
a) filed Mr Green’s Affidavit (the gist of Mr Green’s Affidavit has
already been set out above);10 and
b) filed submissions in support of the dismissal of the application for
review. The submissions set out a detailed analysis of the Court’s
jurisdiction in bankruptcy matters, and the power of a Registrar to
make a sequestration order, and sought costs on an indemnity
basis.
The applicant writes to the Registry of the Court
12. On 14 March 2014 at 9.41am, that is three days, but only one working
day, before the time and date of the listed hearing of the application for
review Mr Kiefer wrote by email to the Court’s Perth Registry email
account as follows:
Hello,
9 The above details are taken from the “Additional Information to orders sought” document attached to the Application for Review. Any emphasis is in that document. 10 See para.7 above.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 7
I would like to cancel the following hearing and get a refund for the filing fee.
17-3-2014 10:15 Hearing Judge Lucev Hearing Room 6.2
King regards
Axel
13. Mr Kiefer did not send or copy the above email to Ledger Acquisitions’ lawyers.
The Registry responds to the applicant
14. A response was sent from the Perth Registry email account from
“Client Services” to Mr Kiefer in the following terms:
Dear Mr Kiefer,
Please direct us to the provision in the Regulations that you say would entitle you to a refund of filing fee.
As far as this registry is aware, there is no such provision and that being the case, we are unable to refund the filing fee. However, if you are able to direct us to the provision you rely on we will reconsider the position.
In relation to determining the application itself your options appear to be to discontinue by filing a notice of discontinuance (form attached) or by appearing on the first return day and requesting that the matter be discontinued.
Thank you
Client Services
15. In fact, Mr Kiefer needed leave of the Court or a Registrar to file a
Notice of Discontinuance at any time within fourteen days before the
listed hearing.11
11 Federal Circuit Court Rules 2001 (Cth), r.13.01(2)(b) (“FCC Rules”).
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 8
The hearing
No appearance by Mr Kiefer
16. When the matter was called on 17 March 2014 at 10.15am there was
no appearance by, or on behalf of, Mr Kiefer. The matter was called
outside of the courtroom, and there was still no appearance.
17. The fact that there was no appearance was consistent with Mr Kiefer’s
email of 14 March 2014, which had been brought to the Court’s
attention, and of which the lawyer for Ledger Acquisitions was made
aware during the course of the hearing.
Dismissal for non-appearance
18. On the basis of Mr Kiefer’s non-appearance at the hearing, Ledger
Acquisitions sought that the application for review be dismissed, and
the Court ordered that it be dismissed accordingly under r.13.03C(1)(c)
of the FCC Rules.
Costs sought on an indemnity basis
19. At hearing, Ledger Acquisitions sought costs on an indemnity basis
against Mr Kiefer.
20. In submissions concerning indemnity costs Ledger Acquisitions
pointed in particular to the fact that there was no prospect of success in
the application for review on the grounds made, that it was hopeless
and ought never to have been brought in the form that it was, and that
as a consequence it was unreasonable for Ledger Acquisitions to have
been subjected to the expenditure of costs in responding to the
application for review.12 Further, Ledger Acquisitions argued that if
basic legal advice had been sought and followed, the application for
review would not have been run on the grounds that were alleged, or at
all.
12 Citing Cirillo v Consolidated Press Property Ltd (formerly known as Citicorp Australia Limited) (No. 2) [2007] FCA 179 at para.6 per Finn J.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 9
Indemnity costs
21. The Court has jurisdiction to grant indemnity costs.13 The law as to
when it is appropriate for the Court to award costs on an indemnity
basis is well established, and the principles applicable to indemnity
costs orders are found in Colgate-Palmolive Company & Anor v
Cussons Pty Limited.14
22. In determining whether to award indemnity costs the Court has a very
wide discretion, to be exercised judicially. The normal practice, not to
be lightly departed from, is to provide for costs on a party-party basis.
Nevertheless, there are certain issues to which the Court will give
consideration, and have to weigh, when determining whether to make,
and the extent of, an indemnity costs order. An indemnity costs order
should only be made where the issues establish special or unusual
circumstances warranting an indemnity costs order. The issues to be
considered include:
a) whether a party should have known that there was no prospect of
success in the case;
b) where a party alleges fraud or forgery, knowing the accusation to
be false, or irrelevant to the issues;
c) where a party precipitately punctuates proceedings by resiling
from a previously adhered to view;
d) where a party acts in a high handed manner;
e) whether the party against whom indemnity costs is sought is a
self-represented litigant, and whether the self-represented litigant
ought to escape the consequences of indemnity costs;
f) where a party proceeds “vexatiously” that is “without sufficient
grounds for the purpose of causing trouble or annoyance”;
g) where a party proceeds for no good purpose at all due to inertia
and carelessness;
13 Genovese v BGC Construction Pty Ltd (No. 2) [2007] FMCA 601 at paras.38-46 per Lucev FM (“Genovese (No. 2)”). 14 (1993) 46 FCR 225 (“Colgate-Palmolive”).
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 10
h) where a party persists in the making of allegations which ought
not to have been made, or in undue prolongation of groundless
contentions;
i) where a party’s conduct causes loss of time to the Court, and to
other parties;
j) where a party imprudently refuses an offer to compromise;
k) whether the award of indemnity costs is sought against a
contemnor; and
l) the objects of:
i) encouraging the saving of private costs and avoidance of
inherent risks, delays and uncertainties of litigation;
ii) saving public cost necessarily incurred in litigation which
events demonstrate to have been unnecessary; and
iii) indemnifying one party where the real cause and occasion of
the litigation is the attitude adopted by the other party.15
23. The discretion is not so circumscribed that an indemnity costs order
may only be made against an ethically or morally delinquent party. The
discretionary categories are not closed, and other elements of litigious
misconduct may be relevant.16
24. The Court also notes that in Harding v Deputy Commissioner of
Taxation17 on an application to set aside a bankruptcy notice in which a
motion was filed in the Federal Court seeking a trial with a jury, in
which the motion was dismissed, the Federal Court observed that:
62 In the circumstances of the present case it is considered that the arguments which the Applicant initially wished to have resolved were without substance and that it is appropriate to make an order that costs incurred prior to 8 August 2008 be paid on an indemnity basis. Those allegations were properly withdrawn, but prior to that date the Respondent had been unreasonably subjected to the expenditure of costs. The
15 Colgate-Palmolive at 233-234 per Sheppard J; Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd & Ors (1988) 81 ALR 397 at 400-401 per Woodward J; Roy Galvin & Co Pty Ltd v Ives [2013] FCCA 1645 at para.60 per Judge Lucev. 16 Genovese (No. 2) at para.48 per Lucev FM. 17 (2008) 172 FCR 206; [2008] FCA 1403 (“Harding”).
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 11
proceeding in this Court has been unnecessarily prolonged by reason of those prior submissions being advanced — only to be withdrawn shortly prior to the hearing of the Motion. Moreover, the Applicant, it may be noted, had previously tried to agitate at least some of the same arguments before the District Court and there had been told that such arguments were “untenable”. To again seek to agitate those same arguments in this Court was, in such circumstances, to expose the Respondent to unnecessary expense.
63 Although it is further considered that the arguments as were ultimately advanced in the 8 August 2008 submissions and during the hearing on 8 September 2008 also had little merit, it is considered that the Applicant should pay the costs of the Deputy Commissioner as from that date — but not on an indemnity basis. Although applications for trial by jury may be uncommon in this Court, when made they should be heard and determined in the usual way. The circumstances in which the present application was ultimately presented may have had little merit, but the absence of such merit is not a sufficient reason in itself to attract an indemnity costs order.18
25. It is necessary, therefore, to consider the matters raised by Mr Kiefer’s
submissions for the purposes of determining whether indemnity costs
ought to be awarded.
The validity of Commonwealth Acts
26. Mr Kiefer’s submission argues that no Act of the Parliament of the
Commonwealth of Australia19 has been validly assented to by the
Governor-General, and there is, therefore, no valid Act of the
Commonwealth Parliament establishing this Court or the existing
bankruptcy regime under the Bankruptcy Act 1966. No justification for,
or particularisation of, the bald assertion of invalidity was provided by
Mr Kiefer.
27. There was no challenge to the validity of the appointment of any
Governor-General or Administrator.20
28. By reason of s.51 of the Constitution, the Parliament has power to
make laws for the peace, order and good government of the
18 Harding FCR at 220 per Flick J; FCA at paras.62-63 per Flick J. 19 “Parliament”. 20 As to the appointment of a Governor-General and an Administrator see Constitution, ss.2 and 4.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 12
Commonwealth with respect to the topics enumerated in s.51 of the
Constitution, including incidental matters. Under s.51(xvii) of the
Constitution the Parliament has the power to make laws with respect to
bankruptcy and insolvency. By reason of s.71 of the Constitution the
Parliament has given the power to create “such other federal courts as
the Parliament creates” to exercise the judicial power of the
Commonwealth, and in which the Parliament may invest federal
jurisdiction. By reason of these powers the Parliament has power to
pass laws such as the Bankruptcy Act 1966, the Federal Circuit Court
of Australia Act 1999 (Cth)21 (previously the Federal Magistrates Act
1999 (Cth)),22 the Federal Magistrates (Consequential Amendments)
Act 1999 (Cth),23 the Acts Interpretation Act 1901 (Cth),24 the Courts
and Tribunals Legislation (Amendment) Administration Act 2013
(Cth),25 the Federal Circuit Court of Australia Legislation Amendment
Act 2012 (Cth),26 and the Federal Circuit Court of Australia
(Consequential Amendments) Act 2013 (Cth),27 and to provide
machinery for their proper execution and administration.
29. The Interpretation Act provides at s.6 as follows:
The date appearing on the copy of an Act printed by the Government Printer, and purporting to be the date on which the Governor-General assented thereto, or made known the Sovereign's assent, shall be evidence that such date was the date on which the Governor-General so assented or made known the Sovereign's assent, and shall be judicially noticed.
30. The Interpretation Act was printed by the Government Printer, and it
was assented to on 12 July 1901.28 The Interpretation Act came into
21 “FCCA Act”. 22 “FM Act”. 23 “FM Consequential Amendments Act”. 24 “Interpretation Act”. 25 “Courts and Tribunals Amendment Act”. 26 “FCCA Amendment Act”. 27 “FCCA Consequential Amendments Act”. 28 The Acts of the Parliament of the Commonwealth of Australia passed in the session of 1901-2 being the first sessions of the first Parliament of the Commonwealth: to which is prefixed the Commonwealth of Australia Constitution Act (63 & 64 VICT., Ch 12) with indexes (Canberra: Commonwealth Government Printer, 1903) page 30.
Ledger Acquisitions Australia MB Pty Ltd v Kiefer [2014] FCCA 2216 Cover sheet and Orders: Page 13
operation on the day it received Royal Assent.29 The date of assent was
published in the Commonwealth Gazette on 20 September 1901.30
31. Section 2 of the FM Act provides that it commences on the day which
it receives royal assent. The FM Act was printed by the Government
Printer, and assented to on 23 December 1999.31 The date of Royal
Assent to the FM Act was published in the Commonwealth Gazette on
19 January 2000.32
32. The FCCA Consequential Amendments Act was printed by the
Government Printer, and it was assented to on 23 December 1999.33
Section 2 of the FM Consequential Amendments Act provides that the
FM Consequential Amendments Act commences at the same time as the
FM Act, with certain other provisions commencing upon the passage of
other legislation which is not relevant for present purposes.
33. The FCCA Amendment Act was printed by the Government Printer, and
it was assented to on 28 November 2012.34 Section 2 of the FCCA
Amendment Act provides that ss.1-3 commence on the day which the
FCCA Amendment Act receives Royal Assent, and that schs.1 and 2
come into operation on a single day fixed by Proclamation. Therefore,
ss.1-3 of the FCCA Amendment Act came into operation on 28
November; that date also being published in the Commonwealth
Gazette of 12 December 2012,35 and schs.1-2 came into operation on
12 April 2013 under a Proclamation by the Administrator of the
Government of the Commonwealth of Australia.36
34. Schedule 1 of the FCCA Amendment Act amended the title of FM Act.
The FM Act became the FCCA Act. The FM Act did not cease: its title
29 Interpretation Act, s.5(1) (as at 12 July 1901). 30 Commonwealth of Australia Gazette, Gazette GN 47 (20.9.1901) 155. 31 The Acts of the Parliament of the Commonwealth of Australia passed during 1999 with tables (Canberra: AusInfo, 2009) vol.8, page 8341. 32 Commonwealth of Australia Gazette, Gazette GN 2 (19.1.2000) 65. 33 The Acts of the Parliament of the Commonwealth of Australia passed during 1999 with tables (Canberra: AusInfo, 2009) vol.8, page 8429. 34 The Acts of the Parliament of the Commonwealth of Australia passed during 2012 with tables (Canberra: Commonwealth of Australia, 2012) vol.6. 35 Commonwealth of Australia Gazette, Gazette GN 49 (12.12.2012) 3234. 36 A Proclamation is defined by s.2B of the Interpretation Act as a Proclamation by the Governor-General that is published in the Gazette or entered in the Federal Register of Legislative Instruments established under s.20 of the Legislative Instruments Act 2003 (Cth). The Administrator of the Government of the Commonwealth of Australia (“Administrator”) is appointed by the Queen and has the same powers as the Governor-General: Constitution, s.4.
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was simply amended. The FCCA Act did not therefore commence as a
new piece of legislation but rather commenced as the FM Act on
23 December 1999.
35. The FCCA Consequential Amendments Act was assented to on
14 March 2013, that being the date published in the Commonwealth
Gazette on 27 March 2013.37 The provisions of the FCCA
Consequential Amendments Act commenced in accordance with the
table set out in s.2 of the FCCA Consequential Amendments Act, with
those dates being between 28 November 2012 and 11 June 2013.
36. The Courts and Tribunals Amendment Act was assented to on
12 March 2013, that being the date published in the Commonwealth
Gazette on 20 March 2013.38 The provisions of the Courts and
Tribunals Amendment Act commenced in accordance with the table set
out in s.2 of the Courts and Tribunals Amendment Act, with ss.1-3 and
sch.1 commencing operation on 12 March 2013 and sch.3 commencing
operation 1 July 2013.
37. The Bankruptcy Act 1966 was printed by the Government Printer, and
it was assented to on 1 June 1966.39 The Bankruptcy Act 1966 was
proclaimed to come into operation on 4 March 1968 under a
proclamation by the Governor-General published in the
Commonwealth Gazette of 9 January 1968.40
38. Formal proof of the relevant Acts and the Governor-General’s assent to
them is not required,41 and the Court may inform itself of those matters
“in any way … [it] thinks fit”,42 including by reference to the relevant
Commonwealth Gazette.43
39. The details of the Governor-General’s assent to each of the Acts of the
Commonwealth Parliament referred to above, and whether evident
37 Commonwealth of Australia Gazette, Gazette GN 12 (27.3.2013) 800. 38 Commonwealth of Australia Gazette, Gazette GN 11 (20.3.2013) 739. 39 The Acts of the Parliament of the Commonwealth of Australia passed during the year 1966 in the first session of the twenty-fifth Parliament of the Commonwealth with appendix, tables and index (Canberra: Commonwealth Government Printer, 1966) page 273; Commonwealth of Australia Gazette, Gazette GN 48 (16.6.1966) 3093. 40 Commonwealth of Australia Gazette, Gazette GN 3 (9.2.1968) 119. 41 Evidence Act 1995 (Cth), s.143(1) (“Evidence Act”). 42 Evidence Act 1995, s.143(2). 43 Attorney-General of The Commonwealth v Foster (1999) 84 FCR 582 at 593 per von Doussa, O’Loughlin and Mansfield JJ; Le v McElwee [2008] ACTSC 55 at paras.33 and 44 per Refshauge J.
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from the copy of an Act printed by the Government Printer or from a
Proclamation printed in the Commonwealth Gazette, demonstrates that
each of those Acts was validly assented to by the Governor-General, a
fact of which the Court may take judicial notice.44
40. The Court therefore finds that each of the Bankruptcy Act 1966, the FM
Act, the FM Consequential Amendments Act, the FCCA Act, the
Interpretation Act, the Courts and Tribunals Amendment Act, the FCCA
Amendment Act, and the FCCA Consequential Amendments Act were
validly assented to by the Governor-General, and are valid Acts of the
Commonwealth Parliament.
41. In the absence of further justification or particulars it is not possible to
understand on what basis the argument that all Acts of the
Commonwealth Parliament are invalid is otherwise put by Mr Kiefer,
and the argument must therefore fail.
Constitutional validity of this Court
42. As to the suggestion, either expressly or impliedly put to the Registrar,
and implicit in Mr Kiefer’s submissions to this Court, that this Court is
not a constitutionally valid court, the Court adopts what was said by the
then Federal Magistrates Court in Fortron Automotive Treatments Pty
Ltd v Jones & Ors (No.4)45 as follows:
10. In Bryant the High Court was dealing with an application seeking an order nisi for prohibition and certiorari against the then Chief Federal Magistrate on the ground that her appointment was unconstitutional. The unconstitutionality was said to pertain to ss.71, 72 and 79 of the Constitution. In Bryant, the High Court observed as follows:
Section 79 of the Constitution provides:
“The federal jurisdiction of any court may be exercised by such number of judges as the Parliament prescribes.”
Section 79 is, therefore, concerned with whether federal jurisdiction is to be exercised by a court constituted by one or by more than one judge.
44 Interpretation Act, s.6; Evidence Act 1995, s.143(1)(a). 45 (2011) 254 FLR 303; [2011] FMCA 854 (“Fortron (No. 4)”).
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Section 11(1) of the Act provides:
" For the purposes of the exercise of the jurisdiction of the Federal Magistrates Court, the Federal Magistrates Court is to be constituted by a single Federal Magistrate.”
It is not arguable that this provision offends s 79. Indeed, it is a provision of the very kind for which s 79 is intended to provide. True it is, as Mr Guarino pointed out in oral argument, s 79 uses the word " judges" and does not use the word " magistrate". Nevertheless, it is clear when regard is had to s 71 and the power given to the Parliament to create “other federal courts" that the title given to the judicial officer by Parliament in creating such another federal court is not determinative of the constitutional reach of s 79 and the other provisions in Ch III. The constitutional reach of s 79 extends to the Federal Magistrates appointed to serve in the court created by the Parliament by the Act.
11. Finally, the High Court observed in Bryant that:
There is no reason to consider it arguable that the constitutional expression “Justice of a court created by the Parliament” does not extend to Federal Magistrates. There is, therefore, no reason to consider that the provisions made in s 9 and Sched 1 of the [FM] Act about the term of office and conditions for resignation or removal from office of Federal Magistrates are invalid.
12. In Totev the Full Court of the Federal Court was dealing with the nature of a review by this Court of a registrar’s order in bankruptcy proceedings. One judge of the Full Court of the Federal Court observed as follows:
The rationale for the review regime briefly described above is that the making of a sequestration order involves the exercise of the judicial power of the Commonwealth. Under Ch III of the Constitution of the Commonwealth, that power cannot be exercised otherwise than by a justice appointed under Ch III. A registrar of the Federal Magistrates Court is not a justice. On the other hand, judges of the Federal Magistrates Court are justices appointed under Ch III.
13. In Simandl a single judge of the Federal Court dealt with a challenge to the nature of this Court and the federal magistrates comprising this Court. In Simandl the Federal Court said that:
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The Federal Magistrates Court is a court created pursuant to the power contained in s 71 of the Constitution, and s 77 of the Constitution permits Parliament to make laws defining the jurisdiction of any federal court it has created. The Federal Magistrates Court exercises the judicial power of the Commonwealth invested under Ch III of the Constitution. Section 10 of the FMA invests the Federal Magistrates Court with such original jurisdiction as is vested in it by laws made by Parliament either by express provision or by application of s 15C of the Acts Interpretation Act 1901 (Cth). The Federal Magistrates Court is a court of record and is a court of the law and equity (see s 8(3) of the FMA).
14. The Federal Court went on to observe that the High Court’s judgment in Bryant “determined that the Commonwealth possesses power to appoint Federal Magistrates”, and further observed that the decision in Bryant was binding on the Federal Court. The Federal Court went on to observe that both the creation of this Court and its constitutional validity had been determined in Bryant. The Federal Court said that it followed that the applicant’s submissions concerning the constitutional validity of the appointment of federal magistrates and of this Court were to be rejected.
15. The judgments in Bryant and Simandl, in particular, make it clear that neither the High Court nor the Federal Court presently entertain any doubt as to the constitutional validity of the FM Act, this Court, the appointment of federal magistrates, or that federal magistrates exercise judicial power, and in particular the judicial power of the Commonwealth.
16. As courts superior to this Court in the hierarchy of federal courts, the High Court’s and the Federal Court’s judgments in Bryant and Simandl are binding on this Court. Bryant and Simandl deal with the jurisdictional issues raised earlier in this judgment, and because they are binding, ought to be followed by this Court. Therefore, this Court has no doubt as to the constitutional validity of the FM Act, the establishment of this Court, the appointment of federal magistrates, or that federal magistrates exercise judicial power, and in particular the judicial power of the Commonwealth.46
46 Fortron (No. 4) FLR at 309-311 per Lucev FM; FMCA at paras.10-16 per Lucev FM (footnotes omitted). The cases referred to in the quoted passage from Fortron (No. 4) are Re Bryant & Anor; Ex parte Guarino (2001) 178 ALR 57; [2001] HCA 5, Simandl v Deputy Commissioner of Taxation (2008) 167 FCR 501; [2008] FCA 450 and Totev v Sfar & Anor (2008) 167 FCR 193; [2008] FCAFC 35.
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43. In Baker & Ors v Commonwealth47 the Full Court of the Federal Court
accepted that the Federal Magistrates Court was a Chapter III court
under the Constitution, and its judicial officers were “Justices”
appointed under s.72 of the Constitution.48
44. Given that the effect of the Courts and Tribunals Amendment Act, the
FCCA Amendment Act and the FCCA Consequential Amendments Act
was to continue in force the court formerly named the Federal
Magistrates Court of Australia as this Court, the above observations
with respect to the then Federal Magistrates Court and FM Act apply
mutatis mutandis to this Court and the FCCA Act, particularly given
that there were no substantive changes to the provisions concerning the
exercise of jurisdiction and power by this Court. The statutory basis for
the Court’s jurisdiction in bankruptcy is s.27 of the Bankruptcy Act
1966,49 for which s.51(xvii) of the Constitution provides constitutional
power, and ss.10(1) and 11 of the FCCA Act which provide as follows:
10(1) The Federal Circuit Court of Australia has such original jurisdiction as is vested in it by laws made by the Parliament:
(a) by express provision; or
(b) by the application of section 15C of the Acts Interpretation Act 1901 to a provision that, whether expressly or by implication, authorises a civil proceeding to beinstituted in the Federal Circuit Court of Australia in relation to a matter.
11(1) For the purposes of the exercise of the jurisdiction of the Federal Circuit Court of Australia, the Federal Circuit Court of Australia is to be constituted by a single Judge.
(2) The Federal Circuit Court of Australia constituted by a Judge may sit and exercise the jurisdiction of the Federal Circuit Court of Australia even if the Federal Circuit Court of Australia constituted by another Judge is at the same time sitting and exercising the jurisdiction of the Federal Circuit Court of Australia.
47 (2012) 206 FCR 229; [2012] FCAFC 121 (“Baker”). 48 Baker FCR at 239 per Keane CJ and Lander J and 248 per Perram J; FCAFC at para.44 per Keane CJ and Lander J and para.79 per Perram J. 49 Which is set out above: see para.4 above.
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45. The Court therefore finds that this Court is a court established under
s.71 of the Constitution, and invested with federal jurisdiction, and
relevantly, federal jurisdiction in bankruptcy.
Power of a Registrar to make a sequestration order
46. Mr Kiefer’s submissions correctly assert that in Davison the High
Court said that the issuance of a sequestration order was an exercise of
judicial power. The question of whether or not the delegation of such
power to a Registrar of a federal court results in the exercise of judicial
power by a Registrar has however been the subject of detailed
consideration post Davison by the High Court in Harris v Caladine50 in
relation to the delegation of powers under the Family Law Act 1975
(Cth) to a Registrar of the Family Court. Harris was applied by the Full
Court of the Federal Court of Australia in Pattison v Hadjimouratis51 in
relation to the delegation to a Registrar of powers under the Bankruptcy
Act 1966 to issue sequestration orders by the then Federal Magistrates
Court of Australia.
47. In Hadjimouratis the minority, although dissenting in the ultimate
result, made the following observations which were observations
agreed in by the majority, with respect to the power of the then Federal
Magistrates Court to delegate the power to make a sequestration order
to a Registrar:
121 The making of a sequestration order is an exercise of judicial power: The Queen v Davison (1954) 90 CLR 353.
122 A delegation by a Federal Court of its judicial powers to an officer of the Court, provided the exercise of that delegate's power is subject to review, does not offend Chapter III of the Constitution. In Harris v Caladine (1991) 172 CLR 84, Mason CJ and Deane J said at 95:
“It seems to us that, so long as two conditions are observed, the delegation of some part of the jurisdiction, powers and functions of the Family Court as a federal court to its officers is permissible and consistent with the control and supervision of the Family Court's jurisdiction by its judges. The first condition is that the delegation must not be to an extent where it can no longer
50 (1991) 172 CLR 84 (“Harris”). 51 (2006) 155 FCR 226; [2006] FCAFC 153 (“Hadjimouratis”).
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properly be said that, as a practical as well as a theoretical matter, the judges constitute the court. This means that the judges must continue to bear the major responsibility for the exercise of judicial power at least in relation to the more important aspects of contested matters. The second condition is that the delegation must not be inconsistent with the obligation of a court to act judicially and that the decisions of the officers of the court in the exercise of their delegated jurisdiction, powers and functions must be subject to review or appeal by a judge or judges of the court. For present purposes it is sufficient for us to say that, if the exercise of delegated jurisdiction, powers and functions by a court officer is subject to review or appeal by a judge or judges of the court on questions of both fact and law, we consider that the delegation will be valid. Certainly, if the review is by way of hearing de novo, the delegation will be valid. The importance of insisting on the existence of review by a judge or an appeal to a judge is that this procedure guarantees that a litigant may have recourse to a hearing and a determination by a judge. In other words, a litigant can avail him or herself of the judicial independence which is the hallmark of the class of court presently under consideration.”
123 Dawson J said at 121-122:
“It merely means that the court may, subject to any restrictions imposed upon it by Parliament, delegate to such of its officers as are suitable such of its functions as it thinks fit. It may do so pursuant to express powers given to it, pursuant to its rule-making power or pursuant to an inherent power to order its own affairs. No doubt it is beyond the power of Parliament to compel a federal court to exercise any of its judicial functions through an officer of the court. The exercise of those functions by that officer would not then be as a delegate of the court and that would be inconsistent with the requirement that the court consist only of judges. For the same reason a federal court must retain effective supervision and control over the exercise of its functions by its officers. If it does not do so, those functions may be seen to be exercised by an officer of the court, not as a delegate, but as a person of independent authority. A federal court must be able to exercise a real choice for itself over those matters, if any, which are maintained if there are insufficient judges for the purpose or if for any other reason the court lacks the necessary capacity. Where the judicial power of the Commonwealth is vested in a federal court, the exercise of that power must be by or on behalf of the court itself, that is, the court consisting of judges, notwithstanding that the court may employ for that purpose an
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organization extending beyond the judges themselves. Whether or not the exercise of judicial power is by or through the court itself will be a matter of practical as much as of theoretical judgment.”
124 Later, Dawson J addressed the rehearing which he assumed to be a rehearing de novo.
125 At 164, McHugh J said:
“It follows, in my opinion, that this Court or a federal court created under s 71 of the Constitution may be authorised to delegate the exercise of its judicial powers to an officer of that court provided that the exercise of the power is subject to review by way of a de novo hearing by a Justice or judge of that court who has been appointed in accordance with s. 72 of the Constitution. It goes without saying that the Parliament cannot require the court to delegate any of its powers. Nor, in my opinion, will anything less than a hearing de novo to review the exercise of the power by the officer be sufficient. That is to say, appellate review is an insufficient condition of the delegation of the exercise of the power; there must be a complete rehearing of the facts and the law as they exist when the Justice or judge reviews the order made by the officer. Otherwise, the officer and not the Justices or judges of the court would be exercising the original jurisdiction of the court.”
126 It is clear that any delegation of a judicial power by a Federal Court to an officer which was not subject to review would offend Chapter 3 of the Constitution because, in those circumstances, the officer, not those appointed pursuant to Chapter 3 of the Constitution, would be exercising the judicial power of the Commonwealth.
127 It is important, therefore, that the delegation be subject to a review. The review must be by way of a de novo hearing otherwise the delegation will again be invalid.52
48. In Hadjimouratis the majority said as follows:
6. It is apparent from the passages in Harris v Caladine (1991) 172 CLR 84 set out in the reasons of Lander J, that it is necessary that the review to be carried out by the federal magistrate must be by way of a de novo hearing. A de novo hearing is what r 20.03(a) of the Federal Magistrates Rules expressly requires.
52 Hadjimouratis FCR at 245-247 per Lander J; FCAFC at paras.121-127 per Lander J, agreed to by the majority: see Hadjimouratis FCR at 229 per RD Nicholson J and 235 per Jacobson J; FCAFC at paras.6-7 per RD Nicholson J and paras.41-42 per Jacobson J.
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7. When the Federal Magistrates Court, whether on application under s 104(2) of the FMA or on its own initiative, conducts a de novo hearing to review an exercise of power by a Registrar — whether under s 102(2) or under a delegation under s 103(1) — it “may make any order or orders it thinks fit in relation to the matter in respect of which the power was exercised”: s 104(3). These are not words of restriction.53
and
41. The combined effect of ss 102(2) and 103(1) of the Federal Magistrates Act and r 20.00A(1)(c) of the Federal Magistrates Court Rules is that the power to make a sequestration order under s 43(1) of the Bankruptcy Act is delegated to the Registrars. As Lander J observes at [121], this is an exercise of judicial power.
42. The delegation of this power to a Registrar is a valid exercise of the power of delegation. This is because the effect of s 104(2) of the Federal Magistrates Act, when read with r 20.03(a) of the Federal Magistrates Court Rules, is that the exercise of the power by a Registrar is subject to a review by way of a hearing de novo: see Harris v Caladine at 95, 121-122, 164.54
49. It follows from the judgment in Hadjimouratis, which is binding on
this Court,55 that the exercise of a power to make a sequestration order
by a Registrar, if it be a power subject to a review by way of a hearing
de novo by this Court, is a power able to be validly delegated to a
Registrar of this Court, and able to be validly exercised by a Registrar
of this Court in making the sequestration order against the estate of Mr
Kiefer on 3 February 2014.56
50. Under the FCCA Act the Court has power to make Rules of Court
pursuant to s.81(1) of the FCCA Act which provides as follows:
(1) The Judges, or a majority of them, may make Rules of Court:
53 Hadjimouratis FCR at 229 per RD Nicholson J; FCAFC at paras.6-7 per RD Nicholson J. 54 Hadjimouratis FCR at 235 per Jacobson J; FCAFC at paras.41-42 per Jacobson J. 55 Suh & Ors v Minister for Immigration & Citizenship & Anor (2009) 175 FCR 515 at 522 per Spender, Buchanan and Perram JJ; [2009] FCAFC 42 at para.29 per Spender, Buchanan and Perram JJ (“Suh”); Fortron (No. 4) FLR at 310-311 per Lucev FM; FMCA at para.16 per Lucev FM. 56 See also Cheesman & Ors v Waters & Anor (1997) 77 FCR 221 at 229-230 per Hill, Heerey and Sundberg JJ where it was held (prior to the establishment of the Federal Magistrates Court) that the power to make a sequestration order could be delegated to a Registrar of the Federal Court, and likewise Taylor & Anor v Deputy Commissioner of Taxation (1999) 42 ATR 220 at 235 per Cooper, Tamberlin and Kiefel; [1999] FCA 195 at para.27 per Cooper, Tamberlin and Kiefel JJ.
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(a) making provision for or in relation to the practice and procedure to be followed in the Federal Circuit Court of Australia (including the practice and procedure to be followed in registries of the Federal Circuit Court of Australia); or
(b) making provision for or in relation to all matters and things incidental to any such practice or procedure, or necessary or convenient to be prescribed for the conduct of any business of the Federal Circuit Court of Australia; or
(c) prescribing matters required or permitted by:
(i) any other provision of this Act; or
(ii) any other law of the Commonwealth;
to be prescribed by the Rules of Court.
51. Pursuant to that power the Court has made the FCC (Bankruptcy) Rules
2006 (Cth)57 which commenced operation on 6 February 2006.58 The
FCC (Bankruptcy) Rules apply to a proceeding to which the
Bankruptcy Act 1966 applies, such as the proceedings presently before
the Court.59
52. Rule 2.02 of the FCC (Bankruptcy) Rules provides as follows:
For the purposes of paragraph 35A(1)(h) of the Act, if the Court so directs, a Registrar may exercise a power of the Court under a provision of the Bankruptcy Act mentioned in Schedule 2.
53. Section 102(2) of the FCCA Act provides that:
(2) The following powers of the Federal Circuit Court of Australia may, if the Federal Circuit Court of Australia or a Judge so directs, be exercised by a Registrar:
…
(i) a power of the Federal Circuit Court of Australia prescribed by the Rules of Court;
57 “FCC (Bankruptcy) Rules”. 58 FCC (Bankruptcy) Rules, rr.1.01, 1.02 and 1.02A. 59 FCC (Bankruptcy) Rules, r.1.03(1).
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54. The “Rules of Court” are defined in s.5 of the FCCA Act and the FCC
(Bankruptcy) Rules are Rules of Court made under s.81(1) of the
FCCA Act.
55. The powers that a Registrar may exercise as a consequence of
s.102(2)(i) of the FCCA Act and r.2.02 of the FCC (Bankruptcy) Rules
are set out in Schedule 2 to the FCC (Bankruptcy) Rules, and included
are those under Items 5 and 9 of Schedule 2 to the FCC (Bankruptcy)
Rules, which relate to the power to make a sequestration order under
ss.43(1) and 52(1) of the Bankruptcy Act 1966 respectively.
56. On 12 April 2013 the Chief Judge of this Court made a direction under
s.102(2) of the FCCA Act directing that the powers in Schedule 2 to the
FCC (Bankruptcy) Rules, as prescribed in r.2.02 of the FCC
(Bankruptcy) Rules, may be exercised by the Registrars set out in an
attachment to the direction. Those Registrars included Registrar Jan
who made the sequestration order against Mr Kiefer’s estate on
3 February 2014.
57. The power to make a sequestration order by a Registrar is reviewable
de novo by this Court by reason of:
a) section 104(2) and (3) of the FCCA Act which provides as
follows:
Registrars to act independently
…
(2) A party to proceedings in which a Registrar has exercised any of the powers of the Federal Circuit Court of Australia under subsection 102(2) or under a delegation under subsection 103(1) may:
(a) within the time prescribed by the Rules of Court; or
(b) within any further time allowed in accordance with the Rules of Court;
apply to the Federal Circuit Court of Australia for review of that exercise of power.
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(3) The Federal Circuit Court of Australia may, on application under subsection (2) or on its own initiative, review an exercise of power by a Registrar under subsection 102(2) or under a delegation under subsection 103(1), and may make any order or orders it thinks fit in relation to the matter in respect of which the power was exercised.
b) rule 2.03(1) of the FCC (Bankruptcy) Rules which provides that:
(1) Subject to any direction by the Court or a Judge to the contrary, an application under subsection 104(2) of the Act for review of the exercise of a power of the Court by a Registrar under subsection 102(2), or under a delegation under subsection 103(1), of the Act must be made by application for review within 21 days after the day on which the power was exercised.
58. It follows, therefore, that the Registrar had power to make the
sequestration order against Mr Kiefer’s estate on 3 February 2014.
Magna Carta
59. The Charter of Magna Carta was signed by King John of England “in
the meadow that is called Runnymede between Windsor and Staines”
on 15 June 1215.60 Only three of the original clauses remain in effect in
the United Kingdom, one of those clauses being cl.39 which became
cl.29 in 1225.61 The current enactment dates from 1297.62 Clause 29 of
Magna Carta reads as follows:
No free man shall be captured or imprisoned or disseised of any free tenement or liberties or free customs or outlawed or exiled in any way destroyed, nor will we go against him or send against him, except by the lawful judgment of his peers or by the law of the land.
60. Mr Kiefer says that the Registrar had no authority to make the
sequestration orders because he did not adhere to a principle
60 C Stephenson and FG Marcham, Sources of English Constitutional History. A Selection Of Documents From A.D. 600 To The Present (New York: Harper & Brothers, 1937) pages 115-126. The quote is from page 126. 61 BW McPherson, The Reception of English Law Abroad, (Brisbane: Supreme Court of Queensland, 2007) page 206 (“McPherson, English Law Abroad”); Re Stanbridge’s Application (1996) 70 ALJR 640 at 642 per Kirby J. 62 Magna Carta Act 1297 (UK), 25 Edw 1 (“Magna Carta”).
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established by cl.29 of Magna Carta that a person was entitled to
lawful judgment by their peers.
61. The Immigration Restriction Act 1901 (Cth)63 was challenged in Chia
Gee & Ors v Martin64 as “unconstitutional, because its provisions were
contrary to the provisions of Magna Charta and the Statutes which had
since confirmed it”.65 Sir Samuel Griffith, the first Chief Justice of the
High Court of Australia, and arguably the principal drafter of what
became the Commonwealth Constitution,66 brooked no argument on
this contention, dismissing it in a single sentence: “The contention that
a law of the Commonwealth is invalid because it is not in conformity
with Magna Charta is not one for serious refutation.”67 The other two
initial Justices of the High Court of Australia, Justices Barton and
O’Connor, contented themselves with concurring with the Chief
Justice.68 Justice Barton, who was the first Prime Minister of the
Commonwealth, and Justice O’Connor, were both involved in the
Constitutional conventions which led to the drafting of the
Commonwealth Constitution, Barton extensively so.69 Such was the
authority of the first three Justices of the High Court of Australia that
no more needed to be said.
62. In Ex parte Walsh and Johnson; in re Yates,70 also a case concerning
the Immigration Restriction Act 1901, Justice Isaacs71 discussed the
Constitutional significance of Magna Carta in an Australian context.
Referring to cl.29 of Magna Carta Justice Isaacs said:
63 “Immigration Restriction Act 1901”. 64 (1905) 3 CLR 649 (“Chia Gee”). 65 Chia Gee at 652-653 per Griffith CJ. 66 Z Cowen, Isaac Isaacs, (Melbourne: Oxford University Press, 1967) (“Cowen, Isaacs”), pages 51-52 says that Sir Samuel Griffith was the “principal draftsman” of the 1891 constitutional bill at the March 1891 Federal Convention in Sydney, the “word[s] of which today remain the essence of our Constitution”: M Coper, Encounters with the Australian Constitution (North Ryde: CCH Australia Ltd, 1987), page 66, and further at page 80 speaking of the “disproportionate contribution” of Sir Samuel Griffith (amongst others). 67 Chia Gee at 653 per Griffith CJ. 68 Chia Gee at 654 per Barton and O’Connor JJ. 69 Martha Rutledge, “Barton, Sir Edmund (Toby) (1849-1920)”, Australian Dictionary of Biography, Australian National University, http://adb.anu.edu.au/biography/barton-sir-edmund-toby-71/text8629; and Martha Rutledge, “O’Connor, Richard Edward (Dick) (1851-1912)”, Australian Dictionary of Biography, Australian National University, http://adb.anu.edu.au/biography/oconnor-richard-edward-dick-1102/text13691. 70 (1925) 37 CLR 36 (“Walsh and Johnson”). 71 Justice Isaacs had also been one of the moving forces behind the drafting of the Commonwealth Constitution: see: Cowen, Isaacs, Ch.4 – “Founding Father: The Federal Convention 1897-1898”.
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The chapter, … recognises three basic principles, namely, (1) primarily every free man has an inherent individual right to his life, liberty, property and citizenship; (2) his individual rights must always yield to the necessities of the general welfare at the will of the State; (3) the law of the land is the only mode by which the State can so declare its will.72
63. Justice Isaacs recognised that personal liberty and property give way to
a declaration by the State (in this case the Commonwealth) of the law
of the land:
These principles taken together form one united conception for the necessary adjustment of the individual and social rights and duties of the members of the State.73
64. In Skyring v Federal Commissioner of Taxation74 the High Court of
Australia held that the power conferred on the Commonwealth
Parliament by the taxation power in s.51(ii) of the Commonwealth
Constitution, to legislate with respect to taxation, extends to the
imposition of taxation and its collection, even though it has the effect
of requiring the person on which taxation is levied to pay the tax out of
property which he owns.75
65. In Arnold & Anor v State Bank of South Australia & Ors76 the
appellants sought to attack a mortgage on the basis that the debt
secured by the mortgage involved the creation by the respondent bank
of a book entry credit at no cost to itself. Magna Carta was invoked as
guaranteeing the rights of the appellants to their matrimonial home and
livelihood.77 Challenges were also made on the basis of passages from
the Bible, and in particular those striking at usury.78 The Full Court of
the Federal Court of Australia, in dismissing the appellants’ appeal, did
not specifically refer to Magna Carta in its reasoning, but approved
what had been said in two recent cases before single Judges of the
72 Walsh and Johnson at 79 per Isaacs J. 73 Walsh and Johnson at 79 per Isaacs J. 74 (1991) 23 ATR 84 (“Skyring”). 75 Skyring at 87 per Gummow, Einfeld and Heerey JJ. 76 (1992) 38 FCR 484 (“Arnold”). 77 Arnold at 484 per Burchett, Hill and Drummond JJ. 78 Arnold at 485 per Burchett, Hill and Drummond JJ.
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Federal Court, including in Fisher & Anor v Westpac Banking
Corporation & Ors.79
66. In Fisher the plaintiffs sought to set aside a claim made by a bank
under a mortgage to their matrimonial home on the basis that the
matrimonial home was guaranteed not to be abrogated from or
interfered with by anyone by reason of authority derived ultimately
from Magna Carta. Similar pleas were also made by reference to
biblical authority. In the Federal Court of Australia, Justice French (as
the current Chief Justice of the High Court of Australia then was), like
the first Chief Justice of the High Court of Australia in Chia Gee,
dismissed the plea by reference to Magna Carta in a single sentence, as
follows:
In relation to the remaining pleas based on the Magna Carta and the Bible, it is sufficient to say they disclose no legally tenable cause of action.80
67. It follows from the foregoing that Commonwealth statutes dealing with
a particular matter operate to repeal any contrary or limiting provision
of Magna Carta.81 In this case, the relevant provisions of the
Bankruptcy Act 1966, the FCCA Act and the FCC (Bankruptcy) Rules
displace and prevail over any effect that Magna Carta might otherwise
have had in the field of bankruptcy law, and Magna Carta did not,
therefore, preclude the issuance of, or render invalid, the sequestration
order made on 3 February 2014 by the Registrar against the estate of
Mr Kiefer.
Habeas corpus and trial by jury
68. The prerogative writ of habeas corpus provided a procedure to compel
the production of a prisoner to a court to enable the course of the
detention to be inquired into.82 It evolved independently of, and pre-
dated, Magna Carta.83 The nature of a writ of habeas corpus was
79 Unreported, Federal Court, No 624/92, 18 August 1992 (“Fisher”), referred to in Arnold at 485-486 per Burchett, Hill and Drummond JJ. 80 Fisher at page 15 per French J. 81 McPherson, English Law Abroad, page 218, and see, more generally on the operation of Magna Carta in England’s former colonies, pages 208-217. 82 McPherson, English Law Abroad, page 218. 83 McPherson, English Law Abroad, page 219.
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summarised in SZQBN v Minister for Immigration & Citizenship84
where the Federal Court observed as follows in a case where a visa
applicant had his visa cancelled and was consequently deprived of his
personal liberty:
28 The proposed ground 1 requires consideration as to whether it is reasonably arguable. The course the appellant now seeks to adopt may be due to the appellant's failure to apply for a writ of habeas corpus before the FMC. Even if the grounds for such writ were made out in the evidence before the court below, the writ itself is not issued as of course. In Antunovic v Dawson (2010) 30 VR 355 at [129]-[130] (Antunovic ), Bell J stated:
“The writ of habeas corpus, although grantable ex debito justitiae, ‘does not issue as of course’ (see R v Langdon; Ex parte Langdon (1953) 88 CLR 158 at 161). A remedy ex debito justitiae is ‘a remedy to which the applicant is entitled as of right’, as distinct from a discretionary remedy (John Burke (ed) Jowitts Dictionary of English Law (2nd ed, 1977) Vol 1, 731). …
The nature of habeas corpus as a writ available as of right, but not of course, was explained in Opinion on the Writ of Habeas Corpus (1758) 97 ER 29. Wilmot J said at common law the writ did not issue as of course ‘but upon probable cause being shown’ (at [32]). When that cause was shown, the writ was issued as of ‘right’, indeed as of ‘birthright’, to the applicant (at [33]). The procedure for showing cause was ‘not a check upon justice, but a wise and prudent direction of it’ (at [33]). (Footnotes inserted as references).”
29 In the Opinion on the Writ of Habeas Corpus (1802) Wilm 77; (1758) ; 97 ER 29, Wilmot J at [33] found in reference to a class of writs, including that of habeas corpus, that “a proper case must be laid before the Court by affidavit, before the parties, praying such writs, may be entitled to them”. Similarly, in Wall v R; Ex parte King Won and Wah On (No 1) (1927) 39 CLR 245, Isaacs J said at [256] that a writ of habeas corpus was “not a writ of course, though a writ of right. It had to be moved for, and a proper case made out”.
30 The appellant specifically does not seek the issue of a writ of habeas corpus, nor was such writ sought in the court below. Rather, the appellant claims that having established the grounds
84 [2013] FCA 276 (“SZQBN”).
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for the issue of such writ before the Federal Magistrate, it is entitled to relief in the nature of prohibition and certiorari.
31 Should an application for a writ of habeas corpus have been made in the lower court, and provided that the grounds for such writ were made out, there would have been no discretion for the Federal Magistrate to have refused the relief: see Ruddock v Vadarlis (2001) 110 FCR 491 at [91]; Antunovic at [132]; Murray v Director General, Health and Community Services and Superintendent, Larundel Psychiatric Hospital (Unreported, Supreme Court of Victoria, Eames J, 23 June 1995).
32 The Court is mindful of a class of decisions referred to by the respondent, namely MIAC v Lu, SZLHP v MIAC and NAWZ v MIAC. Each of these cases confirms the general principle that a grant of constitutional writs is a matter for discretion: see also SZBYR at [28]. However, these decisions do not concern relief sought on the basis of a writ of habeas corpus.
33 Further, the Court notes that the proposed ground, if established, is one which could affect not merely the rights of the parties, but would be of importance to the future conduct of the state in detaining persons pursuant to the Act. In this respect, “the outcome of the case necessarily involves interests wider than the individual interests of the parties”: see Nguyen v Minister for Immigration, Local Government and Ethnic Affairs (1996) 66 FCR 239 at 244.85
69. The above summary from SZQBN confirms that the prerogative writ of
habeas corpus was a right to personal liberty: “… the chief importance
of habeas corpus is the protection it affords to individuals against
arbitrary detention by executive government.”86 As such it has no
application or effect in relation to a sequestration order made under the
Bankruptcy Act 1966 which affects a person’s property, not their
liberty. It follows therefore that the assertion that a writ of habeas
corpus might issue to prevent the sequestration of Mr Kiefer’s estate is
unfounded. The Court is fortified in this view by the judgment of the
Federal Court in Gargan v Kippin Investments Pty Ltd87 where the
Federal Court was dealing with an application which sought to
establish the invalidity of sequestration orders made against the
85 SZQBN at paras.28-33 per Cowdroy J. 86 McPherson, English Law Abroad, page 219. 87 [2008] FCA 1718 (“Kippin Investments”).
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applicant Mr Gargan in earlier Federal Court proceedings. In Kippin
Investments the Federal Court said that:
19. However, out of deference to the manner in which those arguments were developed, I should just briefly record them. Mr Gargan effectively advanced six arguments to establish the invalidity of the orders made by Hely J. The first was an argument based upon the Habeas Corpus Act 1640 (16 Car 1, c 10). As I understand the argument, it was that the Act required effectively, a form of trial by jury in relation to the Local Court matter. The consequence of having been deprived of the right to trial by jury was that the Habeas Corpus Act 1640, being an Imperial statute, could not be thwarted by later domestic law, be that Commonwealth law or State law. This argument seems to me to be without merit. Whatever the terms of the Habeas Corpus Act 1640 might be, the powers of Hely J derived from the Federal Court of Australia Act 1976 (Cth), which in turn derived its authority from Chapter III of the Constitution.
20. It is long established that the powers of the Commonwealth Parliament are unfettered within the limits placed upon them by s 51. I take the operation of the Australia Act 1986 (Cth) to be similar. In that circumstance, whatever the contents of the Habeas Corpus Act 1640 – and I say nothing about that – they could not possibly have the consequence of requiring a matter in the Local Court of the Australian Capital Territory to be tried by jury.88
70. Kippin Investments is binding on this Court.89 In the circumstances, it
is clear that there is no basis for the application of the writ of habeas
corpus or any Imperial Act giving effect to habeas corpus. There is also
no basis for a trial by jury in this Court in relation to the issuance of the
sequestration order. A trial by jury generally only applies in federal
matters where the Commonwealth Parliament sees fit to provide that a
particular offence is triable on indictment.90 Section 80 of the
Constitution in relation to a trial by jury has no application to the
hearing of a creditors petition under the Bankruptcy Act 1966.91 And
whilst s.30(3) of the Bankruptcy Act 1966 provides for a trial by jury, it
88 Kippin Investments at paras.19-20 per Perram J. 89 Suh FCR at 522 per Spender, Buchanan and Perram JJ; FCAFC at para.29 per Spender, Buchanan and Perram JJ. 90 Kingswell v The Queen (1985) 159 CLR 264; Cheng v The Queen (2000) 203 CLR 248; [2000] HCA 53. 91 Gargan v Commonwealth Bank of Australia [2004] FCA 641 at para.3 per Hely J (“Gargan”).
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does so only in proceedings “before the Federal Court” where a
question of fact arises which a party desires to have tried before a jury,
and which the Federal Court may, if it thinks fit, direct to be tried by a
jury. Analogous provisions appear in s.40 of the Federal Court of
Australia Act 1976 (Cth)92 and in respect of which it has been said that
the authorities establish that a substantial reason must be shown for a
departure from the usual mode of trial, being that set out in s.39 of the
FC Act which provides that unless the Federal Court or a Judge
otherwise orders, trials in the Federal Court shall be by a Judge without
a jury.93 In the Federal Court there is no entitlement to a party to have a
trial by jury in a bankruptcy matter, the discretion to do so lying
entirely with the Federal Court.94 In Commonwealth Bank of Australia
v Heinrich95 an application was made to the Federal Court by a debtor
for a jury trial in relation to a sequestration order application, and in
that regard the Federal Court observed as follows:
The use of juries in civil matters has steadily declined during this century and is now largely reserved for those areas where serious imputations are to be made against the character of a party. Like divorce, bankruptcy is no longer regarded as such a matter. In the absence of some very compelling special circumstance, the intention of Parliament is clearly that bankruptcy proceedings be heard by a judge.96
71. The case law with respect to a court which does have jurisdiction and
power to hear a trial by jury in bankruptcy proceedings under the
Bankruptcy Act 1966 therefore nevertheless provides that there must be
very special compelling circumstances before there is a trial by jury,
that is, it is very much the exception rather than the rule.97
72. The authorities in respect of trial by jury under s.80 of the Constitution,
ss.39 and 40 of the FC Act and s.30(3) of the Bankruptcy Act 1966 are
gathered and dealt with comprehensively in Harding which is the most
recent judgment of the Federal Court comprehensively dealing with
92 “FC Act”. 93 Gargan at para.6 per Hely J, citing Insurance Commissioner v Australian Associated Motor Insurer Ltd (1982) 65 FLR 172 and Commonwealth Bank of Australia v Rigg [2001] FCA 590 (“Rigg”). 94 Hubner v ANZ (2000) 101 FCR 71; [2000] FCA 140; Hubner v ANZ (1999) 88 FCR 445 at 450 per Cooper, Kiefel and Tamberlin JJ; [1999] FCA 385 at para.29 per Cooper, Kiefel and Tamberlin JJ. 95 [2000] FCA 1255 (“Heinrich”). 96 Heinrich at para.23 per Mansfield J. Heinrich was followed in Rigg at paras.16-17 per Beaumont J. 97 Rigg at para.7 per Beaumont J. It appears that trial by jury had never been ordered in a bankruptcy matter, or other matter, by the Federal Court up until the time that Rigg was decided in 1999.
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these issues, and in respect of which, and at the risk of grave over-
generalisation, reiterates that, at least in bankruptcy matters, trial by
jury is the exception rather than the rule and dependent upon there
being some substantial reason to order a trial with a jury in
circumstances where there is not an entitlement to trial with a jury.98
73. This Court has concurrent jurisdiction in bankruptcy with the Federal
Court.99 The Bankruptcy Act 1966 does not however extend any
discretion to this Court to order a trial by jury on the same basis as the
Federal Court under s.30(3) of the Bankruptcy Act 1966. That the
specific reference to the Federal Court alone in s.30(3) of the
Bankruptcy Act 1966 is intended to preclude this Court from ordering a
trial by jury in the exercise of any discretion under s.30(3) of the
Bankruptcy Act 1966 is confirmed by statutory amendments to the
Bankruptcy Act 1966 under the FM Consequential Amendments Act.
When the then Federal Magistrates Court was established in 1999 the
FM Consequential Amendments Act amended s.30(3) of the
Bankruptcy Act 1966 to insert the word “Federal” before the word
“Court”.100 Where the then Federal Magistrates Court, now this Court,
was intended to have jurisdiction or exercise power under the
Bankruptcy Act 1966 it was specifically named.101 That this Court is
not intended by Parliament to determine matters with a jury is in any
event conclusively determined by s.53 of the FCCA Act which provides
that civil proceedings between parties in this Court are “to be
determined without a jury.” The Parliament invested this Court with
concurrent jurisdiction with the Federal Court in bankruptcy matters,
but specifically excluded it from hearing matters in its bankruptcy
jurisdiction with a jury.
74. In the above circumstances, there is no room for the application of
principles related to habeas corpus in this Court when hearing an
application for a sequestration order, or for a sequestration order to be
the subject of a trial by jury in this Court.
98 Harding, generally FCR at 209-219 per Flick J; FCA at paras.11-58 per Flick J, and specifically with respect to bankruptcy FCR at 217-219 per Flick J; FCA at paras.48-58 per Flick J. 99 Bankruptcy Act 1966, s.27(1). 100 FM Consequential Amendments Act, s.3, Sch.7, Item 5. 101 See for example Items 2, 3, 4, 6 and 7 of Sch.7 to the FM Consequential Amendments Act, s.3.
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Crimes Act 1914, s.24F
75. Section 24F(1) of the Crimes Act 1914 provides as follows:
(1) Nothing in the preceding provisions of this Part makes it unlawful for a person:
…
(b) to point out in good faith errors or defects in the government, the constitution, the legislation or the administration of justice of or in the Commonwealth, a State, a Territory or another country, with a view to the reformation of those errors or defects;
….
76. For reasons set out above, there was in this matter no error or defect in
the Constitution, any relevant legislation, or in the administration of
justice by the Registrar of this Court in making the sequestration order,
or any want of jurisdiction or power in this Court in relation to the
application for review. Nothing therefore turns upon s.24F(1)(b) of the
Crimes Act 1914 in these proceedings.
Miscellaneous
77. The miscellany of matters alleged concerning the Registrar, including
allegations of the commission of a tort, perversion of the course of
justice, fraud, treason, interference with the judicial process, judicial
misfeasance and lack of authority, require no further consideration in
light of the conclusions reached above. It is, however, necessary to
observe that insofar as they relate to the conduct of the Registrar those
allegations were without any legal or factual foundation, and were
essentially scandalous, and ought not to have been made. As the
Federal Court has observed:
Whether or not a different view is erroneous, there is no basis for asserting that the person taking that view is attempting to pervert the course of justice, or is lying, or is acting unprofessionally. Those sorts of assertions, or like offensive epithets, should not be tolerated.102
102 Kowalski v Chief Executive Officer of Medicare Australia (2010) 185 FCR 42 at 50 per Mansfield J; [2010] FCA 413 at para.34 per Mansfield J (“Kowalski”), citing Bahonko v Nurses Board of Victoria [2008] FCAFC 29 at paras.3 and 10 per Gyles, Stone and Buchanan JJ.
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78. Even though Mr Kiefer was not professionally represented, the
allegations made concerning the Registrar were “entirely
inappropriate”.103
Indemnity costs – whether justified
79. In these proceedings indemnity costs are justified by reason of the
following factors:
a) the endeavours by Mr Kiefer to argue that Magna Carta, habeas
corpus and trial by jury applied to these bankruptcy proceedings
had no foundation in law. The most basic legal research would
have shown that this was the case;
b) the understandable caution expressed in Harding that applications
for trial by jury “should be heard and determined in the usual
way”, and even where there was “little merit” in such an
application, that was “not a sufficient reason … to attract an indemnity costs order”104 cannot apply in this Court because an
application for a jury trial in this Court is expressly excluded by
s.53 of the FCCA Act and a proper reading of s.30(3) of the
Bankruptcy Act 1966;
c) basic legal research would have shown that the High Court in
Harris had in recent years dealt with the issue of allowing
Registrars to exercise a power of delegation from a federal court,
and more specifically that the Full Court of the Federal Court had
done so in Hadjimouratis in relation to sequestration orders;
d) basic legal research would have shown that there were recent
judgments of the High Court, Full Federal Court, Federal Court
and this Court putting the constitutional validity of the creation
and establishment and exercise of jurisdiction of this Court
beyond doubt;
e) the fact that Mr Kiefer was not legally represented, and failed to
appear at the hearing of his application for review, ought not to
allow him to escape the consequences of indemnity costs where
103 Kowalski FCR at 50 per Mansfield J; FCA at para.34 per Mansfield J. 104 Harding FCR at 220 per Flick J; FCA at para.63 per Flick J.
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what has been put on his behalf ought not to have been put and
had no prospect of success, and was sought to be discontinued in
a peremptory manner contrary to the FCC Rules one working day
before it was due to be heard, and without notice to Ledger
Acquisitions, whose lawyers had prepared extensive submissions
in order to meet the arguments to be put by Mr Kiefer;
f) Ledger Acquisitions ought to be indemnified in relation to its
costs because the real cause of the incurring of costs in this
litigation was the attitude and procedure adopted by Mr Kiefer, or
those who appeared or sought to appear on his behalf; and
g) the making of allegations concerning the conduct of the Registrar
were without merit by reason of a lack of legal or factual
foundation, and were essentially scandalous and entirely
inappropriate, and ought never have been put before the Registrar
or the Court.
Conclusions and orders
80. The above Reasons for Judgment reflect the reasons why the Court
concluded on 17 March 2014 that this was an appropriate case for an
award of indemnity costs, and why the Court therefore made orders on
that date that:
(1) The application for review be dismissed pursuant to r.13.03C(1)(c) of the Federal Circuit Rules 2001 (Cth).
(2) The applicant for review pay the respondent for review’s costs in the sum of $6985 by 17 April 2014.
I certify that the preceding eighty (80) paragraphs are a true copy of the reasons for judgment of Judge Antoni Lucev Associate: Date: 30 October 2014
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