Appeal from: Application for leave to appeal: CTI Logistics v Ogbonna

Introduction 1 On 23 May 2022 a judge of this Court made an order pursuant to s 37AO(2) of the Federal Court of Australia Act 1976 (Cth) (vexatious proceedings order) to the effect that the applicant must not institute any proceeding in this Court against CTI Logistics Limited (ACN 008 778 925), any of its officers and employees or any of its present or future legal practitioners. On 20 September 2022 a judge of the Federal Circuit and Family Court of Australia (Division 2) (FCFCOA (Div 2)) made a sequestration order against the estate of the applicant: CTI Logistics v Ogbonna [2022] FedCFamC2G 781 (PJ). 2 The sequestration order was made on presentation of a creditors' petition of CTI Logistics (as the first applicant), Mr Mark Vanderlist (as second applicant) and Mr Tim Barton (as third applicant). Their petition was grounded on an unpaid judgment debt arising from a costs order in the Federal Circuit Court of Australia made on 28 August 2015. Mr Vanderlist and Mr Barton are officers and employees of CTI Logistics. 3 The applicant wishes to institute an appeal from the sequestration order against CTI Logistics, Mr Vanderlist and Mr Barton as the proposed respondents. However, as a consequence of the vexatious proceedings order, the applicant must apply under s 37AR and obtain leave of the Court pursuant to s 37AQ and s 37AT of the Federal Court Act before he may institute an appeal against the proposed respondents. The Court may only grant leave if satisfied that the proposed appeal is not a vexatious proceeding. 4 On 10 October 2022 the applicant filed an originating application under s 37AR(2) of the Federal Court Act for leave to appeal from the sequestration order. On the same day the applicant also filed an interlocutory application styled as an urgent application before the start of a proceeding by which, in effect, he sought orders that his originating application be heard urgently and, if leave be granted, there be a stay of the sequestration orders until the appeal be heard. The applicant also filed a proposed notice of appeal and two affidavits he swore on 10 October 2022. As the applicant required leave both to institute an appeal and to make an urgent interlocutory application, in substance, these documents collectively comprise the application under s 37AR(2). 5 The first affidavit of the applicant was an affidavit he was required to file with the application under s 37AR(3) listing, amongst other things, all other proceedings he had instituted in any Australian court or tribunal and disclosing relevant facts about the application whether in support or adverse to him. The second was an affidavit made in support of the application for urgent interlocutory orders. The applicant also filed further affidavits sworn 31 May 2023 and 9 September 2023 in support of his application. All affidavits of the applicant were read on the hearing of the application. 6 Having regard to the nature of the application and the proposed grounds of appeal, an order was made requiring the applicant to serve the applications on each of the proposed respondents and file an affidavit of service. The applicant complied with those orders and each of the proposed respondents filed notices of address for service. 7 The applicant and the proposed respondents filed written submissions. The proposed respondents' submissions attached a number of documents relating to the proceedings before the primary judge and the proposed grounds of appeal. 8 The applicant submits that the proposed appeal is not a vexatious proceeding because it is an appeal from proceedings the proposed respondents brought against him for the sequestration order and he has a right to appeal from that order. Further, that the grounds of appeal are reasonably arguable. These grounds, in summary, are that the primary judge was in error for not concluding that: (1) the judgment debt upon which the act of bankruptcy was founded was not owing by the applicant to the proposed respondents at the date of presentation of the proposed respondents' petition and the date of the sequestration order by operation of s 9 of the Bankruptcy Act 1966 (Cth) and s 13 of the Limitation Act 2005 (WA) because the applicable six-year limitation period for an action in debt had expired; (2) the applicant had bona fide counterclaims that exceeded the judgment debt; and (3) the proposed respondents had admitted that the creditors' petition was invalid because the judgment debt was statute-barred. Separately, the applicant applies for a stay of the sequestration order on grounds that include allegations that the sequestration order was obtained by fraud, racially discriminatory conduct or in reliance on false or misleading material statements made to the primary judge. 9 The proposed respondents oppose the grant of leave primarily on the basis that none of the applicant's proposed grounds of appeal has any merit. That is, the proposed appeal is a vexatious proceeding, at least, because it is 'without reasonable ground'. Amongst other things, the proposed respondents contend that at all material times the judgment debt arising from the Federal Circuit Court order made on 28 August 2015 (FCC judgment debt and FCC order) was enforceable and that is a complete answer to the applicant's contention that the FCC judgment debt was and is statute-barred. Put another way, the proposed respondents contend that, as the FCC judgment debt was enforceable, they were creditors for the purposes of the sequestration order. 10 An issue as to the enforceability of the FCC judgment debt at the date of presentation of the creditors' petition, as opposed to the date of the sequestration order, emerged during the course of the oral hearing. As a consequence, on 12 September 2023, at the conclusion of the oral hearing, orders were made directing the proposed respondents to file and serve a note identifying the provisions of certain legislation by which they contend that the FCC judgment debt was enforceable as at that date and the applicant was directed to file and serve submissions in reply on four questions relating to the effect of the Full Court's judgment in O'Mara Constructions Pty Ltd v Avery [2006] FCAFC 55; (2006) 151 FCR 196. The proposed respondents filed their note on 19 September 2023. On 3 October 2023 the applicant filed his submissions in reply on the four questions. 11 For the reasons which follow, it is reasonably arguable that the FCC judgment debt was not enforceable at the date the proposed respondents presented their petition (or at the date of the sequestration order) and, as a consequence, it is reasonably arguable that a sequestration order should not have been made. In these circumstances, the applicant should be granted leave to file a notice of appeal that pleads proposed ground 1 of the amended proposed notice of appeal. However, for the reasons which also follow, leave should be refused to file a notice of appeal that raises proposed grounds 2 and 3 because neither of those proposed grounds of appeal pleads a reasonably arguable error on the part of the primary judge. Otherwise, the interlocutory application for an urgent hearing and to stay the sequestration order will be dismissed. I will hear the parties on the question of the costs of the application and orders for directions that should be made relating to hearing the appeal. 12 On 5 October 2023 the applicant also filed an interlocutory application seeking various orders including correction of paragraph 1 of the orders made on 12 September 2023, leave to amend the proposed notice of appeal, and assistance of a Registrar to settle the indices of Part A and Part B of the proposed appeal book. The applicant also filed a proposed amended notice of appeal and affidavit sworn 5 October 2023 with the interlocutory application. The applicant's interlocutory application of 5 October 2023 has not been heard and is not addressed in these reasons. 13 Having regard to the vexatious proceedings order and the observations below concerning the contents of the affidavits the applicant has filed in these proceedings, orders will be made preventing non-parties from inspecting the affidavits filed in these proceedings. Further, orders will be made to prevent the parties filing any further interlocutory applications and affidavits without leave of the Court.

Background 14 On 28 August 2015 a judge of the then Federal Circuit Court made a final order dismissing the applicant's unlawful discrimination claim in those proceedings against the proposed respondents and ordering him to pay costs of $22,762.00 (FCC order and FCC judgment debt): Ogbonna v CTI Logistics Ltd (No 2) [2015] FCCA 2318. On 11 March 2016 an application to extend the time within which the applicant had to appeal from the FCC order was dismissed: Ogbonna v CTI Logistics Ltd [2016] FCA 239. On 20 July 2016 an application for special leave to appeal from that order to the High Court of Australia was dismissed. 15 On 20 July 2016 the applicant commenced defamation proceedings against, amongst others, CTI Logistics in the District Court of Western Australia. On 20 January 2018 those defamation proceedings were dismissed for want of prosecution. On 28 February 2018 the applicant commenced a second suit for defamation against the same parties in the District Court. 16 On 10 May 2019 CTI Logistics requested payment of the FCC judgment debt. It was not paid and on 6 June 2019 a bankruptcy notice was issued. At that time, the FCC judgment debt, including interest, was in the sum of $29,050.63. The applicant then applied to this Court to set aside the bankruptcy notice. Thereafter, by successive orders of judges of this Court the time within which the applicant had to comply with the bankruptcy notice was extended. Those extensions were made pending the final resolution of the second defamation proceedings which were alleged, by the applicant, to comprise a counterclaim that exceeded the amount of the FCC judgment debt. The applicant also commenced proceedings in this Court in which he sought orders setting aside the bankruptcy notice. 17 On 13 August 2019 the second defamation proceedings were summarily dismissed by a registrar of the District Court. On 16 August 2019 the applicant instituted an appeal from the registrar's orders to a judge of the District Court. On 20 November 2019 that appeal was dismissed. On 5 December 2019 the applicant instituted an appeal to the Supreme Court of Western Australia. On 12 February 2021 the applicant's appeal was dismissed. On 12 March 2021 the applicant applied for special leave to appeal from the Supreme Court to the High Court. On 24 June 2021 that application for special leave was refused. On 29 November 2021 a judge of this Court dismissed the applicant's application to set aside the bankruptcy notice: Ogbonna v CTI Logistics Limited [2021] FCA 1491. 18 In the meantime, after special leave to appeal was refused, on 8 October 2021, the applicant filed an originating process and statement of claim in this Court against CTI Logistics and others in which he alleged there were conspiracies and perversions of the course of justice in respect of the determination of the defamation proceedings. On 7 February 2022 a judge of this Court summarily dismissed those proceedings: Ogbonna v CTI Logistics Limited (No 2) [2022] FCA 75. 19 On 23 May 2022 a judge of this Court made the vexatious proceedings order: Ogbonna v CTI Logistics Limited (No 6) [2022] FCA 615. After Ogbonna (No 2) and before Ogbonna (No 6), the applicant made a number of applications, all of which were dismissed: Ogbonna v CTI Logistics Limited (No 3) [2022] FCA 267, Ogbonna v CTI Logistics Limited (No 4) [2022] FCA 358 and Ogbonna v CTI Logistics Ltd (No 5) [2022] FCA 612. Various other litigation in which the applicant has been involved in this Court, the FCFCOA (Div 2) and Western Australian courts is set out in the applicant's first affidavit and need not be mentioned, except to observe that the applicant has listed 46 proceedings in total of which 21 in this Court involve CTI Logistics and one or more of its officers, employees or legal representatives.

Principles of leave relating to vexatious proceedings orders 20 Pursuant to s 37AQ(1) of the Federal Court Act, if the Court makes a vexatious proceeding order prohibiting a person from instituting proceedings of a particular type, as has been done in the case of the applicant, the person must not institute proceedings of that type in the Court without leave of the Court under s 37AT. Pursuant to s 37AQ(2) a proceeding instituted in contravention of that provision is stayed. 21 Pursuant to s 37AR(2) a person may apply to institute a proceeding that is subject to a vexatious proceeding order. Pursuant to s 37AR(4) and r 6.03 of the Federal Court Rules 2011 (Cth) that application must not be served on any person unless an order is made under s 37AT(1)(a). 22 Pursuant to s 37AR(3) the application must be filed with an affidavit in which the applicant lists all the occasions on which the applicant has applied for leave under this section and all other proceedings the applicant has instituted in any Australian court or tribunal and discloses all relevant facts about the application. Pursuant to s 37AS(1) the Court or a judge may dismiss an application under s 37AR if the Court or a judge considered the affidavit does not substantially comply with s 37AR(3). No party contended that there had not been substantial compliance with s 37AR(3) in this case. Pursuant to s 37AS(2) the Court or a judge may also make an order dismissing an application under s 37AR for leave to institute a proceeding if the Court or a judge considers that the proceeding is a vexatious proceeding. 23 Pursuant to s 37AT(1), before the Court makes an order granting an application under s 37AR for leave to institute proceedings, it must order the applicant to serve the persons against whom the applicant proposes to institute the proceeding with a copy of the application and affidavit and a notice that the person is entitled to be heard on the application and give each such person, on appearance, an opportunity to be heard. In this case, orders were made for service on the proposed respondents and each of them filed a notice of address for service, appeared on the hearing of the application and made submissions. 24 Section 37AT read with s 37AR(4) and in the context of the Federal Court Act as a whole evince an intention 'that the persons whose interests might be affected by the proposed proceedings not be unnecessarily vexed by the very making of an application for leave to commence the proceedings'. Thus, where 'a court does not propose to grant the application for leave, there is no requirement that the Court order the service of the application for leave on any person and, indeed, there are sound grounds why it should not': Garrett, in the matter of Company One [2016] FCA 703 at [36]. That is the approach I have taken to the application and it is one of the reasons that I ordered service of the application and supporting affidavits on the proposed respondents. 25 Pursuant to s 37AT(4) the Court may grant leave only if it is satisfied that the proceeding is not a vexatious proceeding. Further, pursuant to s 37AR(3) the Court may make an order granting the application but make it subject to the conditions the Court considers appropriate. The term 'vexatious proceeding' is defined in s 37AM(1) so as to include: (a) a proceeding that is an abuse of the process of a court or tribunal; and (b) a proceeding instituted in a court or tribunal to harass or annoy, to cause delay or detriment, or for another wrongful purpose; and (c) a proceeding instituted or pursued in a court or tribunal without reasonable ground; and (d) a proceeding conducted in a court or tribunal in a way so as to harass or annoy, cause delay or detriment, or achieve another wrongful purpose. 26 The term 'institute' is defined in s 37AM(1) to include for civil proceedings the taking of a step or the making of an application that may be necessary before proceedings can be started against a party. Section 37AM(1) also provides that 'proceeding' for the purposes of, amongst other provisions, ss 37AQ, 37AR, 37AS and 37AT has the meaning given by s 4. Pursuant to s 4 'proceeding' includes an appeal. 27 This Court has jurisdiction to hear appeals from the FCFCOA (Div 2) under s 24(1)(d) of the Federal Court Act. Pursuant to s 25(1AA) the appellate jurisdiction of this Court in relation to an appeal from a judgment of the FCFCOA (Div 2) is to be exercised by a single judge unless a judge considers that it is appropriate for the appellate jurisdiction to be exercised by a Full Court. Pursuant to s 25(2) applications for leave to appeal to the Court must be heard and determined by a single judge unless a judge directs that the application be heard and determined by a Full Court or the application is made in a proceeding that has already been assigned to a Full Court and the Full Court considers it is appropriate for it to hear and determine the application. Therefore, the applicant requires leave to file a notice of appeal so as to institute an appeal: Fuller v Toms [2015] FCAFC 91; (2015) 234 FCR 535 at [18]. 28 Although the application made under s 37AR(2) relates to instituting an appeal for which leave is required, the jurisdiction of the Court invoked by an application under s 37AR(2) may well be the original jurisdiction of the Court. However, whether it is original or appellate jurisdiction does not matter in the circumstances of this case because, in either case, the jurisdiction of the Court is to be exercised by a single judge of the Court. 29 In point of detail, the applicant also requires leave to make the application he has made for the application to institute an appeal to be heard urgently and for a stay of the sequestration order as it was an application he sought to make before any appeal proceedings were commenced. However, in the circumstances, if leave were granted to institute an appeal it would follow that the applicant should not then be required to apply for leave to make an interlocutory application in that appeal for an order for a stay of the sequestration order pending determination of that appeal. Therefore, I approach the question of leave from the perspective that if leave is granted to institute an appeal, the application for a stay should then be heard and determined in that appeal. 30 When considering an order in similar terms to the vexatious proceedings order made in respect of the applicant, the Full Court in Fuller (at [30]-[31]) made the following observations that place the exercise of the Court's power to make a vexatious proceeding order and to grant leave to institute proceedings into context and provide guidance as to the approach that the Court should take on an application such as the present one: 30 The effect of Order 3 is to limit access by Mr Fuller to an exercise of the judicial power of the Commonwealth by this Court. Such access is an important civic right. When Mr Fuller initiated proceedings in this Court or, for that matter, earlier filed his defence and counterclaim in the Queensland Supreme Court, he was not seeking to consume a service, he was invoking a right to have relations between him and the respondents governed according to law by the judicial branch of government. Once this is understood, Mr Fuller is hardly to be criticised for once seeking, by an exercise of judicial power rather than extra-legal means, to resolve his grievance with the respondents. But an essential element of an exercise of judicial power is finality and to seek an exercise of that power is, once any lawfully available right of appeal has been exhausted, to submit to the final outcome of its exercise. Absent the element of finality, the repeated invocation of its exercise by a failed applicant or the repeated assertion of a failed defence by a respondent resisting execution of judgment could in either instance make an exercise of judicial power oppressive. Further, finality does not just resolve once and for all the immediate grievance; it is also conducive to maximising the availability to others of an exercise of judicial power. This point was recently made in the United Kingdom in a report prepared for the Judiciary of England and Wales at the request of the Master of the Rolls - Judicial Working Group on Litigants in Person: Report, July 2013 at p 31: Access to justice does not mean an unfettered access to the courts to pursue frivolous claims and applications. Justice involves a proportionate amount of time and resources being devoted to a particular case. Where the time and resources devoted to one case are disproportionate, that effectively denies parties in another case their fair and timely share; and hence denies them justice. 31 Section 37AO of the Federal Court Act empowers a court to balance the right of one individual of access to justice with other rights namely, a correlative right on the part of the present respondents to finality and the separate right of other individuals also to access this Court. It is for this Court, the present manifestation of a recognition by the Australian Parliament, the origins of which may be traced to an earlier recognition by the United Kingdom Parliament, via the Vexatious Actions Act 1896 (UK) (59 & 60 Vict. C. 51), of a need for a power to effect just such a balance. 31 In James v WorkPower Inc [2018] FCA 2083 Mortimer J, in the context of considering the requirement of leave to commence proceedings in the Court under s 46PO of the Australian Human Rights Commission Act 1986 (Cth), made the following observations about the exercise of the judicial discretion to grant leave (at [31]): Like other judicial discretions empowering leave to be granted to a party to take a step in a proceeding (eg to serve out of the jurisdiction or to issue a subpoena: see rr 10.43(2) and 24.01 of the Federal Court Rules 2011 (Cth)) or to issue a proceeding (eg in relation to vexatious litigants or where leave is required to appeal: see ss 37AR and 24(1A) of the Federal Court of Australia Act 1976 (Cth), the interests of the administration of justice will be a governing consideration in the way the discretion falls to be exercised. However, how the assessment of what is in the interests of the administration of justice is to be undertaken will vary depending on the nature of the power in issue, and the circumstances which give rise to a request for its exercise. Here, as the respondent submits, the imposition of a leave requirement in certain circumstances by the amendments to s 46PO in 2017 had a clear purpose. Any consideration of where the interests of the administration of justice lie must recognise and give weight to that purpose. 32 In Crocker, in the matter of Crocker [2019] FCA 432 (at [10]-[11]) Logan J considered those observations apposite to the exercise of the discretion under s 37AS and s 37AT as providing a filter. His Honour also considered that in order to obtain leave, having regard to the definition of 'vexatious proceeding' as a 'proceeding that is an abuse of the process of a court or tribunal' or a 'proceeding instituted or pursued in a court or tribunal without reasonable ground', the applicant in that case was 'not obliged to prove to demonstration that the proceeding concerned must succeed, only that the proceeding is reasonably arguable.' Further, related to that, 'the context and purpose of the discretion also dictate that an applicant for leave must show that the proceeding concerned is not a vexatious proceeding. These are really different sides of the same coin': Crocker at [12], [26]. 33 In Company One (at [9]) Charlesworth J considered the phrase 'without reasonable ground' to be equivalent in meaning to 'without reasonable cause'. Further, 'without reasonable cause' or 'ground' was to be determined objectively and 'requires an assessment of whether the proceeding is "bound to fail" or "so obviously untenable that it cannot possibly succeed", "manifestly groundless" or "bad beyond argument"'. Additionally, the test imposed by the expression is similar to the one applied by a court on an application for the exercise of summary power to stay or strike out proceedings: citing Hatchett v Bowater Tutt Industries Pty Ltd (No 2) [1991] FCA 236; (1991) 28 FCR 324 at [8] (von Doussa J). Her Honour also made the following relevant observations: 19 An application for leave under s 37AR will necessarily be determined against the legal history of the Court already having made findings (whether or not embodied in declarations) to the effect that the applicant is a person who has frequently instituted or conducted vexatious proceedings in Australian courts or tribunals: s 37AO(1)(a) of the FCA Act. That history may, in a given case, be a relevant and weighty circumstance in determining whether the new proceeding sought to be instituted by the applicant is also to be regarded as vexatious. This is particularly so where the new proceeding appears to be a further attempt by the applicant to agitate an issue already determined, or is otherwise a new manifestation of the same prior obsessions which formed the background to the vexatious proceedings order made against the person in the first place. In a statement that captures an issue arising on the present application, the New Zealand Court of Appeal said in Brogden v Attorney-General [2001] NZCA 208; [2001] NZAR 809 at [21] (emphasis added): A litigant may be said to be persisting in litigating though the number of separate proceedings he or she brings is quite small if those proceedings clearly represent an attempt to re-litigate an issue already conclusively determined against that person, particularly if this is accompanied by extravagant or scandalous allegations which the litigant has no prospect of substantiating or justifying. The Court may also take into account the development of a pattern of behaviour involving a failure to accept an inability in law to further challenge decisions in respect of which the appeal process has been exhausted, or attacking a range of defendants drawn into the widening circle of litigation solely because of an association with a defendant against whom a prior proceeding has failed. 20 Finally, of the balance referred to by the Full Court in Fuller, it should be noted that a person who becomes the subject of a vexatious proceedings order is in a vulnerable position in the sense that he or she does not have the same access to the Court as other members of the community. Particular care should be exercised in circumstances where, as here, the applicant seeks relief in the nature of a declaration of a legal right that the applicant claims to have independently of, and irrespective of, the exercise of the Court's jurisdiction to grant declaratory relief. The nature of the relief of that kind is a circumstance that may tell against a finding that the proceeding is vexatious. (Emphasis original.) 34 Taking into account the approach that has been taken in the authorities to which reference has been made, I consider that instituting an appeal should be considered a vexatious proceeding if none of the proposed grounds of appeal is 'reasonably arguable'. That is, the proposed notice of appeal is without 'reasonable ground'. In that respect, the test to be applied is whether the proposed grounds of appeal are objectively bound to fail or so obviously untenable they cannot possibly succeed. Thus, the proposed appeal would not be a vexatious proceeding if at least one of the proposed grounds is reasonably arguable. 35 Further, considering the question of whether the proposed notice of appeal raises a reasonably arguable ground of appeal will necessarily be determined against the litigation history of the applicant and that a judge of the Court has made a finding that the applicant is a person who has frequently instituted or conducted vexatious proceedings in Australian courts or tribunals. However, in the circumstances of the present application, it is also important to bear in mind that the application is for leave to institute an appeal from proceedings to which the applicant was the unsuccessful respondent. That is, it is not an appeal from a proceeding the applicant brought against the proposed respondents which was dismissed for want of merit. It is also important to appreciate that the applicant seeks leave to institute an appeal from a sequestration order that had the effect of rendering him a bankrupt with all the attendant stigma associated with that status. Absent the vexatious proceeding order, the applicant would have a right to appeal from the primary judge's sequestration order. Accordingly, the significance that the applicant's litigation history would otherwise have had is tempered, to a degree, by the nature of the proposed appeal.

Limitation ground 36 Ground 1 of the proposed notice of appeal, as amended, is as follows: The [judgment] debt dated 28 August 2015 was statutorily barred on 28 August 2021, being 6 years old on that day pursuant to s 9 of the Bankruptcy Act 1966 (Cth) and pursuant to s 13 of the Limitation Act 2005 (WA), based on these legislative provisions thus the decision: CTI Logistics Ltd v Ogbonna [2022] FedCFamC2G 781 delivered on 20 September 2022, was invalid given the [judgment] debt dated was more than six years old and statute barred when the Creditor's Petition was filed on 17 May 2022. 37 Section 9 of the Bankruptcy Act provides that the Act does not affect a law of a State relating to matters not dealt with expressly or by necessary implication in the Act. Section 13(1) of the Limitation Act (WA) provides that: 'An action on any cause of action cannot be commenced if 6 years have elapsed since the cause of action accrued.' The term 'action' is defined in s 3(1) of the Limitation Act (WA) to mean, relevantly, 'any civil proceeding in a court, whether the claim that is the subject of the proceeding or relief sought is under a written law, at common law, in equity or otherwise'. 38 The applicant submits, in substance, that the proceedings in the FCFCOA (Div 2) commenced by the proposed respondents' presentation (filing) of their creditors' petition was '[a]n action on [a] cause of action' and, as such, was statute-barred by operation of s 13(1) of the Limitation Act (WA) because it was commenced on 17 May 2022 which was more than six years after the FCC order was made on 28 August 2015. The applicant also submits that, as an action on the FCC judgment debt was statute-barred at the date of presentation of the petition, there was no debt owing to the petitioning creditors that was payable immediately or at a certain future time for the purposes of s 44(1) of the Bankruptcy Act. As a consequence, the applicant submits the primary judge made an error in failing to dismiss the proceedings below on the ground that those proceedings were commenced outside the limitation period and (or) on the ground that the creditors' petition could not be presented against the applicant (as debtor) because there was no debt owing and payable at that time. 39 The primary judge set out the applicant's three grounds of opposition to the creditors' petition (PJ [34]). None of those grounds raise a limitation defence to the proceedings as a whole or to the existence of a debt for the purposes of s 44(1) of the Bankruptcy Act. 40 However, the primary judge records that the applicant raised the expiry of the limitation period as a ground for contending that there was 'substantial injustice' and, therefore, the primary judge should consider that a defect in the proceedings (that not all facts in the creditors' petition had been verified by affidavit) rendered the proceedings invalid. The applicant contended that substantial injustice resulted because the FCC judgment debt was statute-barred and could not then be the subject of a fresh bankruptcy notice. The primary judge did not consider substantial injustice to arise from that matter because the expiry of the limitation period was primarily due to the conduct of the applicant (PJ [49]). 41 The primary judge also records that the applicant raised the expiry of the limitation period as a ground for contending that the primary judge should have been satisfied that there was other sufficient cause as to why a sequestration order ought not be made for the purposes of s 52(2)(b) of the Bankruptcy Act. The primary judge said that submission 'would be of compelling weight, if that delay were not due, in large part, on the evidence before the Court, to the conduct of [the applicant]' (PJ [64]). 42 The alleged error that the applicant proposes raising in ground 1 of the proposed notice of appeal is not an argument (defence) that he had raised before the primary judge. Therefore, if leave were granted for him to institute an appeal he would require leave of the Court to raise a 'new point' in that appeal. Accordingly, an aspect of considering if proposed ground 1 is 'reasonably arguable' requires consideration of the question of whether the Court would or should permit him to raise proposed ground 1 in an appeal. 43 The principles applicable to the circumstances in which an appellate court will permit an appellant to raise a 'new point' in an appeal are well established. These were recently summarised in Frigger v Trenfield (No 3) [2023] FCAFC 49 at [133]-[170]. The points that would be raised in ground 1 of the proposed notice of appeal are legal points that could not have been met with evidence below. Therefore, the question of whether an appellate court would grant the applicant leave to raise ground 1 turns largely on the merits of those points and whether they have sufficient merit to warrant the grant of leave. That is substantially the same question that arises as to whether the proposed appeal is a vexatious proceeding. Accordingly, if ground 1 of the proposed notice of appeal has sufficient merit to warrant the grant of leave to institute an appeal that leave should be granted as it would have sufficient merit to make it reasonably arguable that the Court would grant the applicant leave to raise that new point in the appeal. 44 The FCC order was pronounced on 28 August 2015. The creditors' petition was presented on 17 May 2022. That was more than six years after the cause of action for the FCC judgment debt accrued. Therefore, an action on that FCC judgment debt was statute-barred at the time of presentation of the petition. There is no jurisdiction (power) to make a sequestration order under s 43 unless at the time of presentation of the creditor's petition 'there is owing by the debtor to the petitioning creditors a debt': s 44(1)(a) of the Bankruptcy Act. 45 Proposed ground 1 and the circumstances of this case raise three principal questions for consideration: (a) Are bankruptcy proceedings commenced by a creditor's petition an 'action' that is statute-barred for the purposes of s 13(1) of the Limitation Act (WA)? If so, the applicant had a defence to the proceedings for the sequestration order. (b) Is a statute-barred debt a debt owing for the purposes of s 44(1)(a)? If not, the FCC judgment debt could not have supported the sequestration order. (c) Notwithstanding the answer to (b), if the judgment creditor is able to execute on the judgment, is there a debt owing for the purposes of s 44(1)(a)? If not, the FCC judgment debt could not have been supported by the sequestration order. 46 In O'Mara Constructions a Full Court (Heerey, Dowsett and Conti JJ) considered these questions in the context of the interaction between s 17(1) of the Limitation Act 1969 (NSW) and s 43 and s 44 of the Bankruptcy Act. 47 Section 17(1) of the Limitation Act (NSW) provided: (1) An action on a cause of action on a judgment is not maintainable if brought after the expiration of a limitation period of twelve years running from the date on which the judgment first becomes enforceable by the plaintiff or by a person through whom the plaintiff claims. 48 Section 43 of the Bankruptcy Act provided (at the relevant time and as of 17 May 2022) that where a debtor has committed an act of bankruptcy, the Court may 'on a petition presented by a creditor, make a sequestration order against the estate of the debtor'. At the relevant time s 44(1) of the Bankruptcy Act was in materially the same terms as it was as on 17 May 2022. As of 17 May 2022, it provided: 44 Conditions on which creditor may petition (1) A creditor's petition shall not be presented against a debtor unless: (a) there is owing by the debtor to the petitioning creditor a debt that amounts to the statutory minimum or 2 or more debts that amount in the aggregate to the statutory minimum, or, where 2 or more creditors join in the petition, there is owing by the debtor to the several petitioning creditors debts that amount in the aggregate to the statutory minimum; (b) that debt, or each of those debts, as the case may be: (i) is a liquidated sum due at law or in equity or partly at law and partly in equity; and (ii) is payable either immediately or at a certain future time; and (c) the act of bankruptcy on which the petition is founded was committed within 6 months before the presentation of the petition. 49 The relevant facts in O'Mara Constructions were as follows. On 21 February 1992 O'Mara Constructions obtained judgment in the Supreme Court of New South Wales against Avery for $147,899.60. On 18 August 2003 the Supreme Court of New South Wales gave O'Mara Constructions leave to enforce its judgment by issue of a writ of execution to be lodged in the registry by 1 September 2003. A further order was made on 10 November 2003 again giving leave to enforce the judgment by a writ of execution. On 12 November 2003 a bankruptcy notice was issued for $125,270.79 being the remaining amount of that judgment sum then due. The bankruptcy notice was not served until 12 March 2004. An application was made to set aside the bankruptcy notice on 21 April 2004 which was dismissed on 27 July 2004. The creditor's petition was presented on 3 September 2004. The petition was heard on 31 May 2005. While there was no evidence as to the outcome of O'Mara Constructions' orders for leave to enforce its judgment, the proceedings were conducted on the basis that O'Mara Constructions was, at the date of presentation of the petition, at liberty to enforce the judgment by issue of a writ of execution. 50 On 5 July 2005 a federal magistrate dismissed the petition on two grounds. First, the presentation of the creditor's petition in bankruptcy was an action on a cause of action on a judgment within the meaning of s 17(1) of the Limitation Act (NSW) and was statute-barred. Second, the judgment debt was also statute-barred by operation of s 17(1) and, as a consequence, O'Mara Constructions was not a 'creditor' entitled to present the creditor's petition pursuant to s 43 and s 44 of the Bankruptcy Act. O'Mara Constructions successfully appealed from the federal magistrate's order dismissing its petition and the Court made a sequestration order in lieu thereof. The Court's reasons for allowing the appeal may be summarised as follows. (1) While a proceeding commenced by petition seeking sequestration is an 'action' within the meaning of s 17(1) of the Limitation Act (NSW), an insolvency proceeding is not an action on a cause of action on a judgment for the purposes of that section: O'Mara Constructions at [38]-[40]. (2) A debt that is statute-barred is not provable in bankruptcy and cannot ground the presentation of a petition of the creditor for the purposes of s 44(1) of the Bankruptcy Act. Also, a statute-barred debt is unenforceable against a trustee in bankruptcy. The date for determination of whether a debt is statute-barred is the date of presentation of the petition: O'Mara Constructions at [19]-[25], citing Motor Terms Co Ltd v Liberty Insurance Ltd [1967] HCA 9; (1967) 116 CLR 177 at 180; Tanning Research Laboratories Inc v O'Brien [1990] HCA 8; (1990) 169 CLR 332. (3) Section 17(1) of the Limitation Act (NSW) did not bar execution upon a judgment, at least where execution is effectively an extension of the original proceedings in the court in which the judgment was obtained: O'Mara Constructions at [11], [16] (citing WT Lamb & Sons v Rider [1948] 2 KB 331 at 337-338 and Lowsley v Forbes [1999] 1 AC 329). (4) Further, to the extent that a creditor is able to execute on a judgment at the date of presentation of a petition, that creditor remains a creditor able to prove in the bankruptcy and able to petition for a sequestration order for the purposes of s 43 and s 44 of the Bankruptcy Act: O'Mara Constructions at [33]-[37], [58]. (5) The intention of the Bankruptcy Act that, in the event of insolvency, a judgment creditor's right to execute be subjugated to the rights of creditors generally, and that the former participate in the administration as an unsecured creditor, is inconsistent with any application of s 17(1) of the Limitation Act (NSW) which would limit the right of such a creditor to petition. In the event of a sequestration order, the Bankruptcy Act would override the creditor's right to execute: O'Mara Constructions at [58]. 51 While O'Mara Constructions is distinguishable in that it is only authority for these propositions as they relate to s 17(1) of the Limitation Act (NSW) it is highly persuasive authority given the similarity between the text of s 17(1) of the Limitation Act (NSW) and s 13(1) of the Limitation Act (WA). It is not reasonably arguable that this Court would approach the construction of s 13(1) of the Limitation Act (WA) differently to the manner in which s 17(1) of the Limitation Act (NSW) was approached in O'Mara Constructions and conclude that the proposed respondents' bankruptcy proceeding against the applicant was an 'action on any cause of action' for the purposes of s 13(1). It follows that it is not reasonably arguable that the proceedings on the creditors' petition in the FCFCOA (Div 2) was 'statute-barred' by operation of s 13(1) of the Limitation Act (WA). 52 On an application of this nature I am prepared to assume, without deciding, that the proposed respondents have a cause of action in debt for the judgment debt. That is, an action in debt could be brought for non-payment of the judgment debt in the same way that an action may be brought in debt on a foreign judgment on the basis of an implied promise to pay the debt or on the basis of a common law cause of action: see, e.g., Dennehy v Reasonable Endeavours Pty Ltd [2003] FCAFC 158; (2003) 130 FCR 494 at [8]-[10] where Finkelstein J (Madgwick and Dowsett JJ agreeing) explains that there are three general categories of action on a judgment. I am also prepared to assume that the cause of action in debt on the FCC judgment debt accrued no later than the date of the FCC order (28 August 2015). Therefore, it is reasonably arguable that any action in debt on the FCC judgment debt was statute-barred by operation of s 13(1) of the Limitation Act (WA) before the creditors' petition was filed and before the sequestration orders were made. 53 It follows that it is reasonably arguable that a claim for the FCC judgment debt was not a debt provable in the bankruptcy and could not correctly ground a sequestration order. However, that does not necessarily mean that it is reasonably arguable that proposed ground 1 of the proposed appeal will succeed. It must also be reasonably arguable that the FCC judgment debt was not 'payable' in the sense that payment of that judgment could not be extracted by execution: O'Mara Constructions at [37]. 54 The proposed respondents submit that it is not reasonably arguable that they were not able to execute on the FCC order because s 13(1) of the Limitation Act (WA) is not relevant to enforcement of judgments and, at all material times, they were entitled to enforce the FCC order by operation of the applicable provisions of the legislation and rules governing enforcement of judgments and orders of the Federal Circuit Court. 55 The proposed respondents submit that they were entitled to enforce the FCC order between the date of that order (28 August 2015) and the date the Federal Circuit and Family Court of Australia Act 2021 (Cth) (FCFCOA Act) came into force (1 September 2021) by operation of s 78 of the Federal Circuit Court of Australia Act 1999 (Cth) (FCCA Act) and Pt 29 of the Federal Circuit Court Rules 2001 (Cth) (FCC Rules). Neither that Act nor those Rules, so the proposed respondents submit, made provision for any limit on the time within which a judgment of the Federal Circuit Court may be enforced. 56 The proposed respondents submit, in substance, that nothing changed after the FCFCOA Act came into force. The effect of that Act was that the Federal Circuit Court continued in existence and became the FCFCOA (Div 2): s 8(2) FCFCOA Act. Judgments of that court may be enforced by operation of s 213 of the FCFCOA Act and Pt 25 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (FCFCOA (Div 2) Rules). Section 18 of Sch 5 of the Federal Circuit and Family Court of Australia (Consequential Amendments and Transitional Provisions) Act 2021 (Cth) (FCFCOA Act Transitional Provisions) provides that the amendments do not affect the validity of anything done before the amendments were made. Therefore, so the proposed respondents submit, the FCC order continues, in effect, as an order of the FCFCOA (Div 2) and is enforceable as an order of that court and was so enforceable at the date of presentation of their creditors' petition and the date of the sequestration order. 57 Section 213 of the FCFCOA Act relevantly provides: 213 Enforcement of judgment … (2) A person in whose favour a judgment of the Federal Circuit and Family Court of Australia (Division 2) 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. (3) Subsection (2) has effect subject to the Rules of Court. … Section 78 of the FCCA Act was in materially the same terms. 58 Rule 25.11 of the FCFCOA (Div 2) Rules provides: 25.11 Execution generally (1) A party may apply to the Court to issue a writ, order or any other means of enforcement of a judgment or order that can be issued or taken in the Supreme Court of the State or Territory in which the judgment or order was made, as if it were a judgment or order of that Supreme Court. (2) An order made under subrule (1) authorises the Sheriff, when executing the orders of the Court, to act in the same manner as a similar officer of the Supreme Court of the State or Territory in which the order is being executed is entitled to act. (3) A party who wants to enforce an order in more than one State or Territory may adopt the procedures and forms of process of the Supreme Court of the State or Territory in which the judgment or order was made. (Notes excluded.) Rule 29.11 of the FCC Rules was in materially the same terms. 59 Section 8 of the Federal Circuit and Family Court of Australia (Consequential Amendments and Transitional Provisions) Rules 2021 (Cth) provides, in effect, that a proceeding that was in the Federal Circuit Court before 1 September 2021 that had not been determined before that day is taken, for the purposes of the FCFCOA Act, to be a proceeding in the FCFCOA (Div 2) after that day. As the FCC order concluded the FCC proceedings it could not be taken to have been a proceeding in the FCFCOA (Div 2) after 1 September 2021. Further, as no application to enforce the FCC order had been made under r 29.11 of the FCC Rules, there was no other proceeding on foot in the Federal Circuit Court as of 1 September 2021. Therefore, there were no relevant proceedings in the Federal Circuit Court before 1 September 2021 that continued after that date as a proceeding in the FCFCOA (Div 2) to which the new rules of that Court, including r 25.11, directly applied. 60 Nonetheless, I accept the proposed respondents' submission that the effect of s 8(2) of the FCFCOA Act and s 18 of Sch 5 of the FCFCOA Act Transitional Provisions is that a judgment or order of a judge of the Federal Circuit Court made before 1 September 2021 operates as a judgment or order of the FCAFCOA (Div 2) after 1 September 2021. The Federal Circuit Court continued after 1 September 2021 as the FCFCOA (Div 2). The repeal of the FCCA Act had no effect on the validity of anything done before 1 September 2021 in relation to the Federal Circuit Court, including judgments or orders of that court. Therefore, s 213 of the FCFCOA Act and r 25.11 of the FCFCOA (Div 2) Rules must apply to judgments or orders of the Federal Circuit Court made before 1 September 2021 as judgments or orders of the FCFCOA (Div 2). 61 The proposed respondents submit that s 213 of the FCFCOA Act and r 25.11 of the FCFCOA (Div 2) Rules place no limitation on the enforcement of the FCC order. For the purposes of considering if proposed ground 1 is reasonably arguable, I am not prepared to accept that submission. 62 It is reasonably arguable that, for the purposes of s 213, an entitlement 'to the same remedies for enforcement of the judgment in [Western Australia], by execution or otherwise, as are allowed in like cases by the laws of [Western Australia]' picks up within that entitlement any limitations on remedies for enforcement that are stipulated in the relevant laws of Western Australia. Likewise, it is reasonably arguable that for the purposes of r 25.11 a person may only apply for and an order may only be made for a means of enforcement of a judgment or order that 'can be issued' in Western Australia. If a means of enforcement cannot be issued in Western Australia due to a limitation on the right of enforcement in that State it is not a means of enforcement that 'can be issued'. 63 In Western Australia the remedies for enforcement of a judgment, by execution or otherwise, and the kinds of orders or other means of enforcement of a judgment that can be issued or taken in the Supreme Court are contained in the Civil Judgments Enforcements Act 2004 (WA) (CJE Act). Section 12 of the CJE Act provides that an order under that Act to enforce a judgment must not be made if 12 years have elapsed since the judgment took effect. Section 13(1) of the CJE Act provides that leave of the court must be obtained before an order may be made under that Act to enforce a judgment if six years have elapsed since the judgment took effect. 64 Section 13(2) of the CJE Act provides: 13. Court's leave to enforce needed in some cases … (2) On an application for leave under subsection (1), the court - (a) may give leave if it is satisfied that the person seeking to enforce the judgment is entitled to do so and that the person against whom the order is sought is liable to satisfy the judgment; and (b) may order the trial of any issue that needs to be decided in order to determine if the judgment may be enforced and, if it may be enforced, by whom and against whom; and (c) may do so on terms as to costs or otherwise. … 65 It is reasonably arguable that if six years have elapsed since a judgment of the Federal Circuit Court took effect, then the judgment creditor has no entitlement to a remedy for enforcement in Western Australia for the purposes of s 213 of the FCFCOA Act unless and until leave to enforce that judgment is obtained from the Court. Further, an order for the issue of a means of enforcement under r 25.11 of the FCFCOA (Div 2) Rules is also subject to the court first granting leave to enforce the judgment or order. Otherwise, for the reasons which follow, I accept the proposed respondents' submission to the effect that s 13(1) of the Limitation Act (WA) has no relevance to and does not operate to bar execution of the FCC order. That is, it is not reasonably arguable that s 13(1) of the Limitation Act (WA) operates to bar enforcement or execution of the FCC order. 66 As already noted, in O'Mara Constructions the Full Court accepted that s 17 of the Limitation Act (NSW) did not operate to limit execution upon a judgment. The Full Court's reasoning was based on the reasoning of the Court of Appeal in WT Lamb & Sons v Rider and the House of Lords in Lowsley v Forbes. The Full Court observed that in Lowsley v Forbes 'the House of Lords concluded that WT Lamb & Sons v Rider was, in effect, wrongly decided insofar as it held that the section did not bar execution. However, their Lordships did not overrule the decision, observing that the relevant legislation had been amended upon the assumption that it was correct.' The Full Court reasoned that the Limitation Act (NSW), including s 17, was founded on an assumption that WT Lamb & Sons v Rider was correct and, therefore, s 17 should be construed consistently with WT Lamb & Sons v Rider: O'Mara Constructions at [11]-[13], [15]-[16]. The Full Court (Madgwick, Finkelstein and Dowsett JJ) reached the same conclusion regarding the operation of s 5 of the Limitation Act 1958 (Vic) in Dennehy v Reasonable Endeavours Pty Ltd [2003] FCAFC 158; (2003) 130 FCR 494 at [5]-[18]. 67 In Dennehy (at [18]) Finkelstein J (Madgwick and Dowsett JJ agreeing) concluded that 'the only "limitation" which applies to the enforcement of a judgment obtained in the Supreme Court of Victoria is that contained in the Rules of the Supreme Court.' As to those rules, Finkelstein J had earlier made the following relevant observations concerning the historical context of execution upon judgments and legislation and court rules affecting execution: Dennehy at [2]. … Once it was the rule that when a year and a day had elapsed after judgment, without execution being levied, the judgment was deemed to have been satisfied. Following the enactment of the Statute of Westminster (13 Edw 1 c 45) a writ of scire facias (a warning) could be served requiring the defendant to show cause why execution should not issue against him notwithstanding the lapse of one year and one day: E Coke, The First Part of the Institutes of the Laws of England (A Commentary Upon Littleton), 291a; Underhill v Devereux (1669) 85 ER 715. This was changed by the Common Law Procedure Act 1852 (UK). Execution could then issue within six years from the recovery of the judgment without revival. After the expiration of six years, a judgment could be revived by leave or by writ of revival: Common Law Procedure Act, ss 128, 129, 130 and 131. In England, following the Judicature Acts, these sections were replaced by rules of court which were to the same effect. The rules were adopted by the superior courts in Australia, although in Victoria the writ of scire facias was preserved: Supreme Court Act 1958 (Vic), s 163. In the Supreme Court of Victoria, the relevant rule now is O 68, r 2. According to this rule, if six years has elapsed since the recovery of a judgment, it is necessary to obtain leave before execution can issue. … 68 In this case, unlike the circumstances under consideration in O'Mara Constructions and Dennehy, the proposed respondents had not obtained leave to enforce or taken any other steps to enforce the FCC order before the notice of bankruptcy was issued or before the presentation of the creditors' petition. The proceedings before the primary judge were not conducted on the assumption that the proposed respondents were at liberty to enforce the FCC order against the applicant. 69 In O'Mara Constructions there was no examination of the judgment creditor's right to execute. The parties had proceeded on the basis that the creditor 'was at liberty to execute on the judgment without any relevant limitation'. The Full Court also noted that the judgment creditor had earlier been granted leave to enforce the judgment: O'Mara Constructions at [34]. The Full Court observed that execution 'is a substantial aspect of a judgment creditor's rights'. Further, at the heart of the Full Court's reasoning that a judgment creditor who is able to execute on the judgment is a 'creditor' in the sense that term is used in s 43 and s 44 of the Bankruptcy Act is the notion that in 'a practical sense, there is no way in which a judgment debt is payable other than by the voluntary act of the debtor or by some form of execution' and that a 'creditor who enforces his or her rights pursuant to a judgment by execution is, in effect, extracting payment': O'Mara Constructions at [36]-[37]. Accordingly, it is reasonably arguable that for the FCC judgment debt to be provable in the bankruptcy it must be a debt capable of payment immediately or at a certain future time by execution. It is reasonably arguable that in the absence of the grant of leave to execute, the FCC judgment debt was not of that character. To that extent, proposed ground 1 raises issues that are reasonably arguable and it is not vexatious.

Counterclaim ground 70 Ground 2 of the proposed notice of appeal, as amended, is as follows: The debtor did not commit an the act of bankruptcy on 29 November 2021, relied on by the creditor, given the debtor had a bona fide counterclaim that monetarily exceeds the [judgment] debt pursuant to s 40(1)(g) and 41(7) of the Bankruptcy Act 1966 (Cth) in the sum of A$745,959.20 (excluding interest) in the originating matter: Ogbonna v CTI Logistics Ltd & Anor - CIV 744 of 2018 which still stands to be remedied now as a claim of fraud by unlawful means conspiracy. 71 Section 40(1)(g) of the Bankruptcy Act provides: 40 Acts of bankruptcy … (1) A debtor commits an act of bankruptcy in each of the following cases: … (g) if a creditor who has obtained against the debtor a final judgment or final order, being a judgment or order the execution of which has not been stayed, has served on the debtor in Australia or, by leave of the Court, elsewhere, a bankruptcy notice under this Act and the debtor does not: (i) where the notice was served in Australia - within the time fixed for compliance with the notice; or (ii) where the notice was served elsewhere - within the time specified by the order giving leave to effect the service; comply with the requirements of the notice or satisfy the Court that he or she has a counter-claim, set-off or cross demand equal to or exceeding the amount of the judgment debt or sum payable under the final order, as the case may be, being a counter-claim, set-off or cross demand that he or she could not have set up in the action or proceeding in which the judgment or order was obtained; … 72 Section 41 of the Bankruptcy Act provides: 41 Bankruptcy notices (1) An Official Receiver may issue a bankruptcy notice on the application of a creditor who has obtained against a debtor: (a) a final judgment or final order that: (i) is of the kind described in paragraph 40(1)(g); and (ii) is for an amount of at least the statutory minimum; or (b) 2 or more final judgments or final orders that: (i) are of the kind described in paragraph 40(1)(g); and (ii) taken together are for an amount of at least the statutory minimum. (2) The notice must be in accordance with the form prescribed by the regulations. (2A) The notice must specify a period for compliance with the notice. That period must be: (a) if the notice is to be served in Australia - the statutory period after the debtor is served with the notice; or (b) if the notice is to be served elsewhere - the period specified by the order of the Court giving leave to effect the service. (3) A bankruptcy notice shall not be issued in relation to a debtor: (a) except on the application of a creditor who has obtained against the debtor a final judgment or final order within the meaning of paragraph 40(1)(g) or a person who, by virtue of paragraph 40(3)(d), is to be deemed to be such a creditor; (b) if, at the time of the application for the issue of the bankruptcy notice, execution of a judgment or order to which it relates has been stayed; or (c) in respect of a judgment or order for the payment of money if: (i) a period of more than 6 years has elapsed since the judgment was given or the order was made; or (ii) the operation of the judgment or order is suspended under section 37. … (7) Where, before the expiration of the time fixed for compliance with a bankruptcy notice, the debtor has applied to the Court for an order setting aside the bankruptcy notice on the ground that the debtor has such a counter-claim, set-off or cross demand as is referred to in paragraph 40(1)(g), and the Court has not, before the expiration of that time, determined whether it is satisfied that the debtor has such a counter-claim, set-off or cross demand, that time shall be deemed to have been extended, immediately before its expiration, until and including the day on which the Court determines whether it is so satisfied. 73 The substance of the applicant's submissions with respect to proposed ground 2 is that 'fraud unravels everything'. He contends that the judgment dismissing his application to set aside the bankruptcy notice was obtained by fraud. Likewise, he contends that the judgment dismissing the proceedings in which he purported to raise counterclaims exceeding the amount in the notice of bankruptcy for the purposes of s 40(1)(g) and s 41(7) of the Bankruptcy Act was obtained by fraud, criminal conduct or other serious misconduct. These allegations and contentions were similar to ground 1 and ground 3 of the grounds upon which the applicant opposed the creditors' petition (PJ [34]). Those grounds were expressed as follows. Grounds of opposition 1. First, given the decision supporting the creditor's petition is fraudulent, it is a sufficient cause that justifies a sequestration order should not be made and for the creditor's petition to be dismissed pursuant to s 52(b) of the Bankruptcy Act 1966 (Cth): a. It follows the decision: Ogbonna v CTI Logistics Limited [2021] FCA 1491 by Justice Craig Grierson Colvin on which the creditor petition was issued is fraudulent, CTI Logistics Ltd, Mark Vanderlist, and Tim Barton did not file the mandatory affidavit in opposition pursuant to rule 2.06 of the Federal Court (Bankruptcy) Rules 2016 (Cth) and the Bankruptcy Act 1966 (Cth) - a prerequisite was not applied (there is no Bankruptcy decision in Australian in which the Bankruptcy Act 1966 (Cth) is not applied). … 3. Third, the Respondents can satisfy the Federal Circuit and Family Court of Australia that he has a counterclaim, set-off or cross demand exceeding the amount of the [judgment] debt pursuant to s 40(1)(g) and 41(7) of the Bankruptcy Act 1966 (Cth) and Rules 3.02 of the Federal Circuit and Family Court of Australia (Division 2) (Bankruptcy) Rules 2021(Cth). a. the claim against CTI Logistics Ltd and Mr Neil Raspa for defamation of the Respondent's character which began at the District Court of Western Australia in the sum of $745,959.20 in the matter: Ogbonna v CTI Logistics Ltd & Anor - CIV 744 of 2018 and led to further judicial corruption in WAD266/2021 and WAD41/2022 is a bonafide claim that has not been extinguished because of fraud. b. the counterclaim, set-off or cross demand and the amount exceeds the amount claimed in the Creditor's petition, which is $29.050.63 and the claim could not be filed at the time because of fraudulent conduct by the Applicants' employees, who have already committed a criminal offence along with Ms Karene Primrose and Chelsea Quirk in filing a fraudulent vexatious applicant application to stifle the Respondent from filing further applications to exercise his fundamental rights. c. the Applicants, and their lawyers, has never challenged or opposed the Respondent's asserted cross-claim, set-off or cross demand that has been provided in various affidavit that has been filed in this and other related proceedings. 74 As to the first ground upon which the applicant opposed the creditors' petition, the primary judge said (PJ [54]-[63]). 54 To the extent that paragraph 1 is seeking to impeach the Judgment Debt the subject of the bankruptcy notice, the Court has taken into account the decision in Cristova v Tan & Tan Lawyers Pty Ltd [2018] FCAFC 41 at [32] to [34]. The Court finds that there is no evidentiary basis to find that the Judgment Debt is not, in truth and in reality, a debt owing. There is no proper evidentiary basis for the allegation that the creditors' petition is fraudulent. 55 The respondent has identified a theory of alleged conspiracy involving the applicants and judicial officers involved in adverse determinations to the respondent. The making of an adverse determination by a court in respect of published reasons cannot be a proper basis for an allegation of fraud. Beyond conclusory assertions by the respondent there is no evidence to support the existence of any fraud by the applicants in the obtaining of the judgment debt the subject of the bankruptcy notice and the respondent's assertions concerning judicial officers are baseless. 56 The respondent's disquiet appears to arise from how he perceives he was treated and the seeking of a sequestration order. The respondent's other sense of grievance arises because of his belief that he has been treated differently by reason of his African heritage. The respondent articulated that he believes his rights have been violated and that he has been subject to systemic racism. These allegations are conclusory assertions and there is no proper evidentiary basis to support the respondent's complaint of differential treatment, violation [of] rights or racism. The applicants have a legal [right] to pursue bankruptcy proceedings given the outstanding judgment debt. There is no evidence of pursuit of these proceedings for an improper purpose. 57 The respondent identified himself as the author of a proposed pleading that was attached to the respondent's affidavit dated 13 September 2022 and described as a counter-claim. There is a proposed originating application with parties to be named later and prayers for relief seeking the payment of damages, including aggravated damages and a proposed statement of claim, identifying the petitioning creditor as the first respondent and identifying other persons as proposed respondents, which comprises 103 paragraphs. That proposed application, proposed statement of claim and the relevant paragraph in the affidavit were initially proposed to be admitted by the Court subject to relevance. However, the Court varied that ruling and admitted the same into evidence. This is because it is apparent that the documents have a potential relevance, being the alleged basis of the counter-claim upon which the respondent seeks to resist the making of a sequestration order and to show other sufficient cause. 58 The respondent's case is re-characterised as fraud in the nature of an unlawful conspiracy and is at the highest level of generality. The allegations involve alleged unlawful conspiracy and contraventions of the Criminal Code Act 1995 (Cth) which are not properly pleaded and, on their face, appear vexatious and, in relation to judicial officers, scandalous. However, because the two documents are at the heart of the respondent claim to have an alleged counter-claim, it, accordingly, cannot be said to be irrelevant to the issues before this Court. Admitting the documents into evidence does not however give the documents any evidentiary foundation. 59 The Court decided, at this hearing, not to strike out the content of the same under r 15.16 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) ("the GFL Rules"), or, at this hearing, to make suppression orders in respect of the content. However, it should be observed that the serious allegations of unlawful conspiracy are not properly pleaded, are not properly particularised and that the unsupported allegations are vexatious and scandalous[.] There is no factual basis to support any agreement to found an allegation of conspiracy and no factual basis to identify unlawful conduct. There is no skerrick of an evidentiary basis for the allegations of fraud. The documents disclose no real cause of action, are embarrassing and do not disclose a genuine counter-claim, set-off or cross demand. There is no need to give further air to the allegations contained in the documents, which require leave to commence proceedings. The Court has no hesitation in finding that the documents have no real prospect of leave being granted to commence proceedings. 60 The Court also finds that the proposed counter-claim is not a real counter-claim, set-off or cross demand. Nor is the counter-claim one which is bona fide. The breadth and seriousness of the unsupported allegations of unlawful conspiracy and embarrassing reference, to judicial officers is sufficient for the Court to find that the counter-claim is not one that is bona fide. Further, there is no evidence of a kind relevant to supporting such serious allegations, so that no prima facie case in the sense understood in Ebert has been made out. The Court finds that the counter-claim does not have a fair chance of success and does not demonstrate that the respondent is entitled to litigate that counter-claim. 61 The Court accepts the submissions of the applicants that the counterclaim appears to be a dressed-up endeavour through the lens of unlawful conspiracy to re-agitate unsuccessful defamation proceedings brought by the respondent. As found above there is no evidence before the Court that the respondent's rights have been violated. There is no evidence before the Court that the respondent has been the subject of some systemic racism. There is no evidence before the Court that the respondent has suffered unlawful discrimination by the petitioning creditors or by any of the representatives of the petitioning creditors. 62 There is no basis to find that the respondent has been subjected to conduct that has stripped him of his dignity and rights. The applicants have obtained a lawful judgment debt and do have legal rights to bring these proceedings. The respondent has recently been the subject of an order that requires him to seek leave to bring proceedings in accordance with a statutory regime, the purpose of which is to prevent the limited court resources from being unnecessarily drained from vexatious proceedings that have no real prospect of success and to prevent baseless litigation to the detriment of the public[.] It should be noted that the respondent has not, thereby, been deprived of the ability to seek access to the courts. 63 If the respondent identifies a proper claim in respect of which there is a reasonable prospect of success, it can be anticipated that leave would be granted to bring such proceedings. However, the documents annexed to the respondent's affidavit of 13 September 2022 are, as referred to above vexatious and have no reasonable prospect of success and have no reasonable prospect of a grant of leave by a court to permit the respondent to bring the same. The court's resources are limited and judicial time is precious and there are statutory objects that require the courts, parties and practitioners to resolve genuine matters fairly, efficiently and without unnecessary expense. The Court finds that the respondent's proposed statement of claim and proposed originating application do not make other sufficient cause why a sequestration order ought not to be made. 75 As to the third ground upon which the applicant opposed the creditors' petition, the primary judge said (PJ [74]-[77]). 74 In relation to the third ground in the notice of opposition, the respondent contends that the outcome of the Second Defamation Proceedings were tainted by fraud and that there remains a counter-claim in relation to the defamation proceedings. This proposition of the Second Defamation Proceedings being tainted because of the existence of fraud is not supported by any proper evidence and is baseless. There is no real or bona fide counter-claim, set-off or cross demand arising from alleged defamation or fraud. The respondent has made out no prima facie case or fair chase of success as explained above and Court is not satisfied that there is any fraud or defamation suit that the respondent has demonstrated that [he] is entitled to litigate. 75 The respondent's endeavour to re-agitate the Second Defamation Proceedings is, on its face, hopeless and does not identify other sufficient cause as to why a sequestration order ought not to be made. 76 The respondent's assertion of criminal offences and reference to his fundamental rights and an endeavour to stifle the same has no proper evidentiary basis. The Court is not satisfied that any proper counter-claim, set-off or cross-demand has been identified by the respondent in relation to the applicants by reason of the content of Ground 3 of the notice of grounds of opposition. 77 Ground 3 otherwise appears to assume an absence of challenge to the existence of a cross-claim, set-off or counter-demand which is, on its face, clearly contradicted by the contested proceedings upon which the respondent was ultimately unsuccessful in seeking to set aside the statutory demand. No other sufficient cause as to why a sequestration order ought not to be made has been made out by ground 3. 76 Proposed ground 2 does not plead or otherwise identify any alleged error of fact or law in the reasoning of the primary judge set out above. Insofar as the applicant, through his affidavits in support of the application, sought to place evidence before this Court on the application, many of the observations the primary judge made relating to evidence before him on the creditors' petition apply in equal measure. These affidavits contain allegations of serious misconduct involving judicial officers, court administrative staff, the proposed respondents and their legal representatives. These allegations are made at the highest level of generality and amount to bare assertions. The affidavit material is scandalous and liable to be struck-out and the affidavits removed from the Court record. In short, none of the affidavit material supports the applicant's assertions. While I do not exercise the Court's power to strike out the scandalous parts of the applicant's affidavit, I do not admit them as evidence on the application and take them to be unsubstantiated submissions. Accordingly, I will also make an order to the effect that the affidavits may not be inspected by a non-party without leave of a judge of the Court. 77 Ground 2 of the proposed notice of appeal is untenable and bound to fail.

Admission ground 78 Ground 3 of the proposed notice of appeal, as amended, is as follows: The Respondents admitted in their filed submissions on 2 1 September 2022 that the [judgment] debt was over seven years, and that being the case means, the creditor petition was invalid because the [judgment] debt was statute barred at the time the sequestration orders were made on 20 September 2022 and the decision: Ogbonna v CTI Logistics Limited [2021] FCA 1491 was invalid given s 40(1)(g) of the Bankruptcy Act 1966 (Cth) and the Bankruptcy Act 1966 (Cth) was not applied or cited and therefore the debtor could not have committed an act of bankruptcy on 29 November 2021 79 Proposed ground 3 raises a similar argument to the second ground upon which the applicant opposed the creditors' petition (PJ [34]). That ground was expressed as follows: Grounds of opposition … [2]. Second, the creditor's petition be dismissed pursuant to rules 15.18 and 15.19 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth): a. the applicants' solicitor on 19 August 2022 pursuant to rule 15.19 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) was served a 'notice to admit facts or documents'. b. Subsequently the applicants did not serve a 'notice disputing a fact or a document' within 14 days, on or before 2 September 2022, as required by the Court rules. c. the applicants' admission pursuant to rule 15.18 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) mandates that the creditor's petition be dismissed. 80 Rule 15.18 and r 15.19 of the FCFCOA (Div 2) Rules provide: 15.18 Admission If an admission is made by a party, the Court may, on the application of another party, make an order to which the party applying is entitled on the admission. 15.19 Notice to admit facts or documents (1) A party to a proceeding (the first party) may, by notice in accordance with the approved form, ask another party to admit, for the proceeding, the facts or documents specified in the notice. (2) If the other party does not, within 14 days, serve a notice on the first party disputing the fact or the authenticity of the document, the other party is taken to admit, for the proceeding only, the fact or the authenticity of the document. (3) The other party may, with the Court's leave, withdraw an admission taken to have been made under subrule (2). (4) Unless the Court otherwise orders, if the other party serves a notice disputing a fact or the authenticity of a document and the fact or the authenticity of the document is later proved in the proceeding, the other party must pay the costs of the proof. 81 On 19 August 2022 the applicant served on the solicitors for the proposed respondents a notice to admit. By a letter dated 31 August 2022 the solicitors responded to the effect that it was not clear whether the notice to admit was issued in the correct form in compliance with the relevant rules and that, in any event, the matters were not valid facts for the proposed respondents to admit in that matter and that they were not, in fact, admitted. They requested that the letter be formal notice that the facts are not admitted. 82 As to this ground the primary judge said (PJ [67]-[72]): 67 The second ground upon which the notice of objection contends that the creditor's petition should be dismissed makes reference to a notice to admit facts and the absence of a service of a notice disputing facts. On the respondent's evidence, it is apparent that the notice to admit facts identified four paragraphs, and contained content that could not fairly be described as "facts". 68 Paragraph 1 of the notice to admit facts made reference to the requirement in the Bankruptcy Rules in respect of the respondent's application to set aside the bankruptcy notice. Rule 2.06 was relevant in that application but is not relevant to these proceedings. Further, it is apparent that r 2.06 was subject to r 1.04 of the Bankruptcy Rules. 69 Further, the content of paragraph 1 appears to be a contention of legal construction or argument and does not fairly reflect a fact engaging the relevant provisions of the Bankruptcy Rules in respect of a notice to admit. 70 Paragraph 2 of the notice to admit facts appears also to be an argument of law or submission as to the application of provisions of the Act and Bankruptcy Rules. Paragraph 2 does not, on its face, identify a fact engaging the Bankruptcy Rules or the GFL Rules in respect of a notice to admit facts. 71 Paragraph 3 of the notice to admit facts also appears to be a submission or contention of law in respect of the validity of the creditor's petition and does not reflect a fact capable of being the subject of a notice to admit facts under the Bankruptcy Rules or the GFL Rules. 72 Paragraph 4 of the notice to admit facts also advances an alleged submission of law and does not articulate a fact capable of being the subject of a notice to admit facts under the Bankruptcy Rules or the GFL Rules. Further and in any event, it is apparent that there was a response sent which, under the Bankruptcy Rules and the GFL Rules, did not have to be in a particular form. That response, which was sent by a letter dated 31 August 2022, was within the time period applicable under the GFL Rules and squarely identified the same as being formal notice pursuant to the GFL Rules that the facts are not admitted. The Court finds that that was a valid response to the notice to admit facts, even if it were otherwise capable of being said to articulate facts to which the Bankruptcy Rules or GFL Rules could apply. No relevant admissions arise from the respondent's purported notice to admit facts because the facts if so characterised were disputed within time. 83 Proposed ground 3 does not plead or otherwise identify any alleged error in the manner in which the primary judge addressed the second ground of the applicant's opposition. The primary judge's reasons fairly and accurately record the effect of the applicant's notice to admit and the proposed respondents' response, through their solicitors. 84 Proposed ground 3 fails to identify any reasonably arguable ground of appeal.

Leave should be granted subject to conditions 85 In substance, ground 1 of the proposed notice of appeal pleads that the primary judge erred in law in failing to conclude that by operation of s 9 of the Bankruptcy Act and s 13(1) of the Limitation Act (WA) the applicant was not a debtor of the proposed respondents at the date of presentation of the creditors' petition and, as such, they were not creditors entitled to present that petition under s 43 and s 44 of the Bankruptcy Act. 86 In substance, the proposed respondents would respond to that ground of appeal by raising a contention (possibly by way of notice of contention) that the primary judge's judgment was correct because the FCC order was able to be enforced on the date of presentation of the petition. Consequently, the proposed respondents were creditors for the purposes of s 43 and s 44 of the Bankruptcy Act. It is reasonably arguable that such a contention would fail and, therefore, that the applicant would succeed on proposed ground 1. As noted earlier, the applicant would, nonetheless, require leave to raise ground 1 as it is a new point not raised before the primary judge. However, as that ground has merit, it is reasonably arguable that such leave would be granted. In these circumstances, a notice of appeal that raises ground 1 would not be a vexatious proceeding. 87 On the other hand, grounds 2 and 3 of the proposed notice of appeal are not reasonably arguable and are without reasonable ground. Therefore, a notice of appeal pleading those grounds would, in part, be a vexatious proceeding. 88 It follows that the applicant should have leave to file a notice of appeal confined to ground 1 of the proposed notice of appeal.

Application for stay of the sequestration order and other proceedings should be refused 89 Before and at the hearing of the application I requested the parties to make submissions on the extent to which, if leave were granted to the applicant in whole or in part, to institute an appeal the Court should consider and determine the merits of the appeal on the materials and submissions filed in the application. The applicant supported dealing with the matter in that manner and the proposed respondents did not. In these circumstances it was and is not possible to deal with the substantive merits of ground 1 of the proposed notice of appeal and it will now be necessary for the parties to prepare for another hearing on the substantive merits of the appeal. It is also now necessary for the Court now to address the applicant's application for a stay of the sequestration order. 90 The principles applicable to the circumstances in which an appellate court will grant a stay of the judgment the subject of an appeal are well established. These principles were recently summarised and restated by Banks-Smith J in Remta v Baker (Executrix) [2022] FCA 1485 (at [9]-[14]), in the context of an application for a stay of a sequestration order in circumstance in which, like here, the 21 day period for a stay under the sequestration order that may be made under s 52(3) of the Bankruptcy Act has expired, as follows: 9 Mr Remta is self-represented before me. He has not pointed to the source of the power that he requests I exercise in order to grant the stay. The time period relevant to s 52(3) of the Bankruptcy Act has expired. I will assume that Mr Remta relies on r 36.08(2) of the Federal Court Rules 2011 (Cth). That rule provides: However, an appellant or interested person may apply to the Court for an order to stay the execution of the proceeding until the appeal is heard and determined. 10 An appellant who seeks a stay under r 36.08 of the Rules must satisfy the Court that a stay is required to preserve the subject matter of the litigation, or that the refusal of a stay would make it difficult for the Court, in the determination of the appeal, to grant the relief sought. 11 In short, Mr Remta must establish that there is an arguable point on the proposed appeal or some rational prospect of success in relation to any of the grounds of appeal, and that the balance of convenience favours the grant of a stay: Endresz v Australian Securities and Investments Commission [2014] FCA 1139 at [16]. 12 Mr Remta's application is to be considered in the context that a sequestration order takes effect as soon as it is made. As soon as a debtor becomes a bankrupt, their property immediately vests in the trustee in bankruptcy, under s 43(2) and s 58(1) of the Bankruptcy Act. They remain bankrupt until discharged or until the bankruptcy is annulled. 13 The Court does not have the power to suspend the operation of the sequestration order, but only to stay proceedings under it. The position was neatly summarised by Stewart J in Du Bray v ACW [2020] FCA 1142: [8] Section 153B(1) of the Bankruptcy Act provides that if the court is satisfied that a sequestration order ought not to have been made, the court may make an order annulling the bankruptcy. Under s 37(2) the court does not have power to suspend the operation of a sequestration order. If an appeal against a sequestration order is successful, the sequestration order can be set aside (under s 28 of the Federal Court of Australia Act 1976 (Cth); Simon v Vincent J O'Gorman Pty Ltd (1979) 27 ALR 619 at 625 and 631; De Robillard v Carver [2007] FCAFC 73; 159 FCR 38 at [149]-[150] and [1]) or the bankruptcy may be annulled (under s 153B(1)). In either event the sequestration order has operation while it remains extant: Pattison v Hadjimouratis [2006] FCAFC 153; 155 FCR 226 at [58]. [9] There are two points to take from the above. The first is that the power that the court has is not to stay the sequestration order, but only to stay proceedings under the order. The sequestration otherwise immediately takes effect until it is set aside or annulled. The other is that even if the appeal is successful and the sequestration order is set aside, it would have continued to operate in the interim … 14 More recently the Full Court in Ritson v Commissioner of Police (NSW) [2021] FCAFC 208 confirmed the position at [57]-[66] (Allsop CJ, Lee and Downes JJ). 91 It follows that the Court has no power to stay or suspend operation of the sequestration order. However, the Court has power to stay proceedings under that order if satisfied that there is a prospect that the applicant will succeed in the appeal and the balance of convenience favours the grant of a stay. For the reasons already given, I am satisfied that the applicant has a prospect of succeeding on the appeal. 92 As to the balance of convenience, the applicant deposes that the stay is necessary to allow the continuance of proceedings in the Family Court of Western Australia. The applicant deposes that those proceedings are stayed by operation of s 60(4) of the Bankruptcy Act. Although the applicant has referred to s 60(4), I assume that he intended to refer to s 60(2) by which an action commenced by a person who subsequently becomes a bankrupt is, upon his or her becoming a bankrupt, stayed until the trustee makes an election to prosecute or discontinue the action. To the extent proceedings in the Family Court are stayed as a consequence of the applicant becoming a bankrupt, the Court has no power to make an order that would change his status as a bankrupt. Otherwise, there is insufficient evidence as to whether the trustee has or has not made an election or the proceedings are otherwise thwarted by any election that has been made. 93 The applicant has also requested a stay of the requirement that he make out and file with the Official Receiver a statement of his affairs under s 54 of the Bankruptcy Act. In this respect there is no evidence or other material before the Court as to any reason why the balance of convenience would favour a stay of that step in the bankruptcy proceedings. 94 I am not satisfied that the balance of convenience favours a stay of the bankruptcy proceedings or any steps required to be taken in those proceedings.

Other matters 95 As noted earlier in these reasons, the applicant filed a number of affidavits containing scandalous material that is liable to be struck-out and (or) removed from the Court file. Further, the applicant filed interlocutory applications without leave and without applying for leave contrary to the vexatious proceedings order. In these circumstances, although the applicant should be granted leave to file a notice of appeal on conditions, it is necessary that the Court maintain control of the appeal proceedings. To that end, I will make an order preventing the parties to the appeal from filing any further interlocutory applications or affidavits in the appeal without leave of the Court.

Conclusion 96 The applicant will have leave to file a notice of appeal confined to ground 1 of the proposed notice of appeal. The date of filing of that notice will have effect from 10 October 2022. The applicant's application for an urgent hearing and a stay will be dismissed. Orders will be made to prevent non-parties from inspecting affidavits filed in the proceedings without leave of the Court. Orders will also be made to prevent the parties from filing interlocutory applications and affidavits without leave of the Court. Otherwise, I will hear the parties on appropriate orders for directions in the appeal and on the question of the costs of the applications. I certify that the preceding ninety-six (96) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Feutrill.