Bond v Beaman

REASONS FOR JUDGMENT 1 On 3 June 2014, I refused an application by Mr Bond to stay certain orders of the Family Court of Western Australia pending the hearing of an appeal against those orders in this Court, and gave ex tempore reasons for doing so. These are an edited version of those reasons. 2 Mr Bond seeks two orders. The first, that order 1 of the Family Court of Western Australia, made 4 April 2014, which provided that, pursuant to s 208 of the Bankruptcy Act 1966 (Cth), his property be released from control under Div 2 of Pt X of the Bankruptcy Act, be stayed until a decision is given in the appeal pending in this Court. The second, that order 1 of the Family Court of Western Australia, made 30 April 2014, be stayed until a decision is given in the appeal to this Court. 3 I should say, for the record that I earlier ruled or effectively ruled in the course of argument on a submission made by counsel for Ms Beaman that I am without jurisdiction to deal with the application before me, in circumstances where Gilmour J on 16 May 2014 referred the question of the competency of the appeal to a Full Court, for hearing before the appeal. I rejected that argument. 4 The submissions made by counsel for Ms Beaman ultimately relied upon the effect of s 25(2BB) of the Federal Court of Australia Act 1976 (Cth), which seemed to make it clear that, where an application of this nature 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, then a single Judge cannot hear it. It is an interesting preventive provision because there are a couple of qualifications to it but, in the end, I formed the view that the proceeding has not already been assigned to a Full Court. The only thing that has been referred to a Full Court is the preliminary question of the objection to competency that has been taken on behalf of Ms Beaman. Thus, as counsel for Ms Beaman put it, a question of discretion then arose as to whether the Court either should hear the application or perhaps consider referring it instead to the Full Court that is apprised of the competency issue or, more generally, as to the strength of the application for a stay. 5 I have, thus, heard the greater arguments put in relation to the stay. For reasons which I will elaborate on relatively shortly in a moment, I am not minded to grant the stay in terms of either paragraphs 1 or 2 of the interlocutory application before me. It is trite to say, I think, despite all of the authorities that I have been referred to and which seem to have been referred to by her Honour in making the orders, or at least the last of the orders on the stay application made before her, that the general principles governing an application for a stay, in the determination of an appeal or application for leave to appeal, are not in doubt. 6 The party seeking the stay must demonstrate a reason or an appropriate case to warrant the exercise of a discretion in his or her favour. The requirement is not satisfied by the mere filing of an appeal or an application for leave to appeal. The Court has a discretion whether or not to grant the stay and, if so, as to its terms. In the exercise of the Court's discretion, the Court weighs considerations such as the balance of convenience and the competing rights of the parties, in particular whether prejudice will be caused by reason of the grant or withholding of a stay. Within this framework, the Court exercises a broad discretion and the party seeking a stay does not have to establish special circumstances. In general, a party which has succeeded at the trial is entitled to the benefit of a judgment and thus to commence with the presumption that the judgment is correct. All of that was said, more or less, by the Full Court of this Court in Philip Morris (Australia) Ltd v Nixon [1999] FCA 1281 at [17]. 7 The principal issue raised by counsel on behalf of Mr Bond was that to fail to grant a stay will, effectively, mean the loss of a statutory moratorium under the Bankruptcy Act. It is said that if Mr Bond loses that, then his situation will be rendered nugatory, the appeal will be rendered nugatory. In the result, I am not sure that that is right. I should make a couple of preliminary comments before I get to what, in the end, mostly motivates me in refusing the application for a stay. 8 It is an unusual situation, in some ways, currently before me. In the Family Court of Western Australia, the primary judge made orders on 4 April 2014 that are the now subject of an appeal to this Court and in respect of which Ms Beaman has filed a notice of objection to competency. As I have pointed out, it is only the competency issue that has currently been referred to a Full Court, so it is not the appeal, in substance, that is currently listed for determination by that Full Court. I do not need to go into the arguments in any detail about that issue. 9 I accept counsel for Mr Bond's argument that there are proper grounds for advancing a submission that the appeal is properly in this Court, in essence, as a Court of bankruptcy and that it would not be appropriate to consider that the appropriate venue for an appeal is, for example, the Full Court of the Family Court of Australia. On the other hand, again, without going into the detail and refinements of that argument, it is along those lines that the objection to competency has been raised, that ordinarily that is exactly where appeals from a decision of the Family Court of Western Australia go to, the Full Court of the Family Court, and that is where this appeal should go. As I say, all I need to say about that is that the submissions made by counsel for Mr Bond have a proper basis to them. 10 Similarly, if one were to consider the substantive appeal question, then there are grounds pressed in the notice of appeal against the finding that the order should be made, ultimately on the basis that the Court could not be satisfied, on the evidence, that special circumstances justified it in making the order that it made under s 208 of the Bankruptcy Act. I do not need to rehearse those reasons supporting the making of that order. They have been canvassed on both sides of the bar table and submissions made to me. 11 I accept that, again, there is a proper argument to be made, as outlined by counsel for Mr Bond and, equally, there are proper responses to be made on the basis outlined by counsel for Ms Beaman, noting also counsel for Ms Beaman's point that, in all likelihood, he will be or has been instructed to file a notice of contention in the appeal in due course. Again, it is a question of discretion as to where, having regard to the background, prejudice and justice lies when it comes to considering the grant of a stay in a proceeding such as this. 12 The order of 30 April 2014 is, really, at the heart of the proceeding. Counsel for Mr Bond says if $100,000 has to be paid in accordance with the order made that day, which, on the face of it, must happen unless there is a stay of that order, there will be a loss of the statutory moratorium and that goes against the general scheme and policy of the Bankruptcy Act. Undoubtedly, in general circumstances or ordinary circumstances there is force in that observation. 13 The background to this particular set of orders, however, and, in particular, the orders of 30 April 2014 made by her Honour in the Family Court, are to be found in an earlier order made on 26 February 2013, in long-running proceedings between Mr Bond and Ms Beaman in the Family Court of Western Australia, concerning property. It had been ordered that Ms Beaman receive the sum of $100,000 to be paid to her lawyers, in connection with those proceedings. 14 On 30 April 2014, having entertained and rejected an application by Mr Bond to stay the order of 4 April 2014, her Honour noted, and here I am referring to the reasons that she gave for the order of 30 April 2014 in Beaman v Bond [2014] FCWA 27 at [10], that after delivery of the judgment on 4 April 2014, Ms Beaman sought to relist her Family Court application for enforcement and, at that point, a London property had been sold and there were funds on hand of about $4 million. At [7] of her Honour's reasons in refusing a stay, she noted, as I just have, that the genesis of Mr Bond's application for a stay related to an attempt by Ms Beaman to enforce the order made on 26 February 2013 in the Family Court proceedings that had been running since 2010 and that that order was for Mr Bond to pay her the sum of $100,000 to assist her in litigation costs and that sum was to be paid within 30 days of 26 February 2013. 15 There is apt to be an error made in not fully appreciating the facts as they have been laid out by me and that the order made on 30 April 2014 by her Honour in paragraph 1(a), requiring payment of $100,000 out of the sale proceeds of the London property, was all about securing or, as I put in the course of argument, in aid of enforcement of that earlier order. It was not an order that, in that sense, came out of the blue. To allow a stay of the proceeding now, given that background and the efficacy of an order made some time ago, which has been in place and obviously not met, would be wrong and I consider unjust. To grant, in those circumstances, a stay of the orders, pending the determination of the appeal in this Court, even pending a consideration of the competency objection by a Full Court, would not serve a just outcome. 16 This is, in those circumstances, a case where, even though there might be proper arguments about competency and/or the bases upon which her Honour made her orders on 4 April 2014, the justice of the case, the balance of convenience, lies in favour of Ms Beaman. In those circumstances, I refuse the interlocutory application dated 28 May 2014. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker.