GROUNDS OF APPEAL
56 Ms Beaman pressed on the hearing of the appeal the argument that the Full Court was in as good a position as the primary judge to infer, and therefore find, that the presentation of the Petition in all the circumstances was an abuse of process. This may be accepted. There is more scope for the drawing of inferences on appeal when there is no doubt as to the facts: see Devers v Kindilan Society (2010) 269 ALR 404 per Ryan, Mansfield and McKerracher JJ (at [49]). An appellate court is in as good a position as the trial judge to decide on the proper inference to be drawn from undisputed facts. The principle that the Court's role on an appeal by way of rehearing is the correction of errors (see Minister for Immigration and Border Protection v SZVFW [2017] FCAFC 33 per Griffiths, Kerr and Farrell JJ (at [41]-[44])) does not prevent this Court, in deciding what is the proper inference to be drawn, to shrink from giving effect to its own conclusion: see Warren v Coombes (1979) 142 CLR 531 (at 551); Dynamic Hearing Pty Ltd v Polaris Communications Pty Ltd (2010) 273 ALR 696 per Besanko J (with whom Moore and Gordon JJ relevantly agreed) (at [80]-[86]); Madden v Seafolly Pty Ltd (2014) 313 ALR 1 per Rares and Robertson JJ (at [66]); cf Construction, Forestry, Mining and Energy Union v Alfred (2011) 203 IR 78 per Flick J (at [94]). This principle has particular application where (as in this case) the case below was a "paper trial". In such cases, the appeal court is in as good a position as the trial judge to make findings of fact and thus need not defer to the trial judge when considering the facts: see Australian Capital Territory v Crowley (2012) 273 FLR 370 per Lander, Besanko and Katzmann JJ (at [63]) and note Tex Services Ltd v Shibani Knitting Co Ltd [2016] UKPC 31 per Lord Mance (for Privy Council) (at [8]) in the context of delay.
57 Counsel for Ms Beaman accepted that there are three strains of argument on appeal. One is that the approach of the Evidence Act and the usage of the Trustee's affidavit was wrong at law.
58 The next concerns the delay in the delivery of the judgment.
59 The third area on the appeal concerns the abuse of process argument. The abuse of process turns on the point that Mr Bond was living a lavish lifestyle, and that there was no pressure for payment from creditors, such that the only possible inference is that the primary purpose of the bankruptcy was to defeat proceedings in the Family Court, having regard to the timing of the lodging of the Petition and the urgency of the lodging of the Petition as reflected in surrounding emails which have since been discovered.
60 Having shortly stated the topics of appeal, the written form of the grounds was substantially more complex. For completeness, the grounds of appeal in full are set out as follows:
1. The learned Judge erred in law in rejecting Ms Beaman's objection to the admissibility of parts of the affidavit referred to in Reasons at para 6 (the [Trustee's] Affidavit) by holding that the rules of evidence (including the rule against hearsay) did not apply to a report prepared by a trustee in bankruptcy. See Reasons paras 13, 23, 24, 25, 26 & 30.
2. Alternatively to ground 1 above, the learned Judge erred in law in failing to conclude that [the Trustee's] Affidavit was admissible only as an opinion concerning Mr Bond's solvency and for no other purpose. See Reasons at paras 26, 29 & 30.
3. The learned Judge erred in law in failing to properly address Ms Beaman's application under section 135(a) of the Evidence Act 1995 (Cth) to exclude those parts of [the Trustee's] Affidavit which repeated what Mr Bond had told [the Trustee] and [the Trustee's] subordinates concerning Mr Bond's affairs. See Reasons at paras 9 (c), (d), (e), (h) & (i), 27 & 28.
4. The learned Judge erred in law in failing to uphold Ms Beaman's application under section 135(a) of the Evidence Act 1995 (Cth) to exclude those parts of [the Trustee's] Affidavit which repeated what Mr Bond had told [the Trustee] and [the Trustee's] subordinates concerning Mr Bond's affairs. See Reasons at paras 9 (c), (d), (e), (h) & (i), 27 & 28.
5. The learned Judge erred in failing to provide adequate findings and reasons to enable a proper understanding of the basis upon which he dismissed the annulment application and in particular failed to demonstrate that all the arguments presented on behalf of Ms Beaman had been carefully assessed. It should be inferred from the inadequacy of the Reasons and the lengthy delay in handing down a decision that the learned Judge overlooked parts of the argument in the case and that his findings were unsafe, resulting in a substantial miscarriage of justice.
Particulars
(a) Aside from matters relating to non-compliance with rule 7.03 of the Federal Circuit Court (Bankruptcy) Rules 2006 (Cth), the hearing of the annulment application was concluded on 11 March 2015. See Reasons at page 3 & Beaman v Bond (No 1) [2015] FCCA 2311 (28 August 2015).
(b) Aside from some brief cross-examination and re-examination of [the Trustee], the evidence adduced at the hearing of the annulment application was in the form of:
(i) affidavits which were read into evidence; and
(ii) a small number of documents which were tendered.
See Reasons at paras 3 - 8.
(c) Ms Beaman relies on the following correspondence between 11 March 2015 (being the date referred to in particular (a) above) and 16 December 2016 (being the date referred to in particular (d) below) concerning the delivery of judgment in respect of the annulment application:
(i) Letter dated 13 July 2016 from Solomon Brothers (Ms Beaman's then solicitors) to the Associate to [the primary judge].
(ii) E-mail dated 27 October 2016 from the Deputy Associate to [the primary judge] to Solomon Brothers in reply to the letter referred to in paragraph (i) above. That e-mail (omitting formal parts) stated: "Chambers cannot give an indication when judgment delivery will be. As soon as it is listed you will be notified."
(iii) Letter dated 18 November 2016 from Ms Beaman to the Chief Judge of the Federal Circuit Court.
(iv) Letter dated 21 November 2016 from the President of the Western Australian Bar Association to the Judicial Coordinator to the Chief Judge of the Federal Circuit Court.
(v) Letter dated 24 November 2016 from the Associate to [the primary judge] to the solicitors for the parties stating that judgment would be delivered on 16 December 2016.
(d) Ms Beaman will seek leave of this Court under section 27 of the Federal Court of Australia Act 1976 (Cth) to tender copies of the correspondence listed in particular (c) above in evidence appeal.
(e) The learned Judge pronounced orders on 16 December 2016 without delivering oral or written reasons for decision. See Reasons at page 3.
(f) The Reasons are dated 23 December 2016. See Reasons at page 3.
(g) Ms Beaman relies on the matters referred to in ground 3 above.
(h) Ms Beaman relies on the matters referred to in grounds 6, 8, 12, 13, 4, 17 and 18 below.
6. The learned Judge erred in law in failing to address:
(1) the plea in paras 2 & 55 of the schedule to Ms Beaman's amended application (Schedule), quoted in Reasons at para 2; and
(2) paras 13, 36 - 40 & 83 of the written submissions filed by Ms Beaman's counsel (Ms Beaman's Written Submissions), which were relied on at the hearing,
by reference to each of the matters referred to in paras 3 - 54 of the Schedule, both individually and in combination with each other.
7. The learned Judge erred in fact and/or law by failing to find that, in combination, the matters referred to in paras 3 - 54 of the Schedule, rendered Mr Bond's presentation of a debtor's petition an abuse of process. See Reasons at paras 84 & 88.
8. Alternatively to grounds 6 and 7 above, the learned Judge erred in law in failing to address:
(1) the plea in paras 2 & 55 of the Schedule; and
(2) paras 13, 36 - 40 & 83 of Ms Beaman's Written Submissions, which were relied on at the hearing,
by reference to the timing of each of the matters referred to in paras 9, 12, 13, 26, 29, 31, 32, 35, 37, 39, 44, 46 & 47 of the Schedule, both individually and in combination with each other.
9. The learned Judge erred in fact and/or law by failing to find that, in combination, the timing of each of the matters referred to in paras 9, 12, 13, 26, 29, 31, 32, 35, 37, 39, 44, 46 & 47 of the Schedule rendered Mr Bond's presentation of a debtor's petition an abuse of process. See Reasons at paras 84 & 88.
10. The learned Judge erred in law in rejecting Ms Beaman's submission that:
(1) the objective of the Section 208 Proceeding (as defined in Reasons at para 37); and
(2) the effect of the success of the Section 208 Proceeding,
of themselves thereby rendered Mr Bond's subsequent presentation of debtor's petition an abuse of process. See Reasons at paras 53, 78, 82, 83, 84, 87 & 88.
11. The learned Judge erred in law by effectively treating Mr Bond's insolvency as determinative against an annulment of Mr Bond's bankruptcy under section 153B(1) of the Bankruptcy Act 1966 (Cth) notwithstanding section 153B(2) of the Bankruptcy Act 1966 (Cth). See Reasons at paras 58 & 75.
12. The learned Judge erred in law in failing to consider the contention of Ms Beaman's counsel that the presentation of a debtor's petition could still be annulled on an application under section 153B(1) of the Bankruptcy Act 1966 (Cth) even where the bankrupt is insolvent if there has been abuse of process. See Reasons at paras 59-74.
13. The learned Judge erred in law in failing to make any findings as to Mr Bond's "predominant purpose" in presenting a debtor's petition notwithstanding:
(1) paras 22, 24 & 25 of Ms Beaman's Written Submissions, which were relied on at the hearing;
(2) the reliance on Williams v Spautz (1992) 174 CLR 509 by Ms Beaman's counsel during oral submissions; and
(3) the reliance on the discussion of English cases such as In re a Debtor [1967] Ch 590 by Gibbs CJ, Murphy, Brennan & Dawson JJ in Clyne v Deputy Commissioner of Taxation (1984) 154 CLR 589 by Ms Beaman's counsel during oral submissions.
14. The learned Judge erred in law in failing to consider the impact of section 153B(2) of the Bankruptcy Act 1966 (Cth), in the exercise of the discretion whether or not to annul Mr Bond's bankruptcy, in the context of each of the matters referred to in paras 3 - 54 of the Schedule, both individually and in combination with each other.
15. The learned Judge erred in fact and/or law by failing to find that, having regard to section 153B(2) of the Bankruptcy Act 1966 (Cth) and the combined effect of the matters referred to in paras 3 - 54 of the Schedule, a proper exercise of discretion under section 153B(1) of the Bankruptcy Act 1966 (Cth) required Mr Bond's bankruptcy to be annulled.
16. The learned Judge erred in fact in failing to find that Mr Bond was under no pressure to repay the loans from Fairoak Pty Ltd, Sunland Nominees Pty Ltd and Tambar Pty Ltd (Bond Companies), having regard to the:
(1) financial statements of the Bond Companies, which suggested that those loans had been in existence for many years;
(2) notes to the financial statements of the Bond Companies AASB 101 at paras 70 - 77, which suggested those loans were repayable within 12 months;
(3) absence of any written demand for payment from any of the Bond Companies being adduced into evidence; and
(4) failure of Mr Bond to give evidence.
See Reasons at paras 66 - 70 and Schedule at para 16.
17. The learned Judge misconstrued Ms Beaman's reliance on Mr Bond's lavish lifestyle as a contention that Mr Bond was solvent. Such reliance was directed to the:
(1) contention that Mr Bond would not have presented a debtor's petition but for the matters referred to in paras 9, 12, 13, 26, 29, 31, 32, 35, 37, 39, 44, 46 & 47 of the Schedule; and
(2) exercise of discretion under section 153B(1) of the Bankruptcy Act 1966 (Cth) as to whether or not to annul a bankruptcy having regard to section 153B(2) of the Bankruptcy Act 1966 (Cth).
See Reasons at para 74.
18. The learned Judge misconstrued Ms Beaman's submissions concerning the loans from the Bond Companies as a contention that Mr Bond was solvent. Those submissions were directed to the:
(1) contention that Mr Bond would not have presented a debtor's petition but for the matters referred to in paras 9, 12, 13, 26, 29, 31, 32, 35, 37, 39, 44, 46 & 47 of the Schedule; and
(2) exercise of discretion under section 153B(1) of the Bankruptcy Act 1966 (Cth) as to whether or not to annul a bankruptcy having regard to section 153B(2) of the Bankruptcy Act 1966 (Cth).
See Reasons at paras 66 - 70.
19. The learned Judge erred in fact in failing to draw the inference that Mr Bond would not have presented a debtor's petition based on the debts referred to in Reasons at paras 71 (a), (b), (d), (e) & (f) but for the matters referred to in paras 9, 12, 13, 26, 29, 31, 32, 35, 37, 39, 44, 46 & 47 of the Schedule. The learned Judge should have found that, having regard to the matters set out in the Schedule, Mr Bond could have and would have obtained assistance from members of the Bond family and/or Bond related entities to pay debts other than those owing to Ms Beaman and the Bond Companies. See Reasons at 71 - 74.