Consideration
37 The applicant has not established there is a proper basis to go behind the judgments of Perram J, Flick J and Rares J.
38 To explain why that is so it is necessary to consider the history of these proceedings in more detail.
39 The background to these proceedings is accurately summarised by Griffiths J in his Honour's reasons dismissing the respondent's application to set aside the Bankruptcy Notice: Dunkerley v Comcare [2019] FCA 1002. It is convenient to recite that summary, relevantly from [7]-[15]:
[7] Ms Dunkerley is a teacher. On 24 October 2007, she suffered an injury described as an "adjustment disorder with anxious mood" which she claimed was contributed to, in significant measure, by her employment at the former Commonwealth Department of Education, Science and Training (DEST). Although initially attempts were made to return her to work in another area of DEST, these attempts were unsuccessful and she was transferred to the Department of Industry, Innovation, Science, Research and Tertiary Education (DIISR) in May 2008.
[8] Comcare initially declined liability for the October 2007 injury. On 16 June 2009, the AAT made a consent decision in which Comcare accepted liability for Ms Dunkerley's injury suffered on 24 October 2007.
[9] In March 2009, Dr George (a psychiatrist), concluded that Ms Dunkerley no longer presented with any psychiatric diagnosis and that she had full capacity to return to work.
[10] On 1 September 2009, Ms Dunkerley made a claim for compensation from Comcare for aggravation of her condition arising from her interactions with a more senior colleague at DIISR in July 2009 in the context of her participation in a promotion round. This claim for aggravation was rejected by Comcare on 8 December 2009 and its decision was upheld on an internal review by Comcare on 11 February 2010. Ms Dunkerley sought a review of Comcare's decision in the AAT.
[11] Comcare's decision was affirmed by the AAT in its decision dated 17 November 2010, which is reported as Re Dunkerley and Comcare [2010] AATA 915 (First AAT Decision). The AAT found that Ms Dunkerley's aggravation had been suffered as a result of the feedback that she received from her more senior colleague (who was the Chair of the Selection Advisory Committee) on 17 July 2009. The feedback related to her unsuccessful attempt to obtain a promotion and the AAT found that it constituted reasonable administrative action taken in a reasonable manner in respect of her employment and that, accordingly, there was no "injury" for the purposes of s 5A of the SRC Act.
[12] Ms Dunkerley appealed the First AAT Decision to this Court. The appeal was dismissed by Perram J on 3 February 2012. His Honour's reasons for judgment are reported as Dunkerley v Administrative Appeals Tribunal [2012] FCA 41. Comcare did not seek costs against Ms Dunkerley and none was ordered.
[13] Ms Dunkerley appealed to the Full Court from Perram J's decision. On 13 September 2012, the appeal was dismissed by Lander, Logan and Barker JJ. Their Honours' reasons for judgment are reported as Dunkerley v Comcare [2012] FCAFC 132; 131 ALD 1. An order for costs was made in favour of Comcare. Comcare did not pursue those costs and they do not form part of the basis of the bankruptcy notice which is the subject of the present proceeding.
[14] Before describing the background to the three costs orders which form the basis of the bankruptcy notice, it is apt to say something about other proceedings in the AAT involving Ms Dunkerley and Comcare which preceded the making of those three costs orders.
[15] In early May 2013, Ms Dunkerley reagitated her claim for compensation arising from her October 2007 injury. On 20 May 2013, Comcare denied liability to pay Ms Dunkerley compensation under ss 16 and 19 of the SRC Act from 2 March 2009 to the date of that determination in relation to Ms Dunkerley's "adjustment disorder with anxious mood" suffered on 24 October 2007. The basis for the denial was Comcare's determination that Ms Dunkerley had recovered from the injury suffered on 24 October 2007 by no later than 2 March 2009. Comcare's determination that Ms Dunkerley had recovered from her injury was based on a medical report by a medical practitioner named Dr George. This decision was affirmed on internal review and Ms Dunkerley then sought review of that internal review decision in the AAT. On 18 June 2014, the AAT affirmed Comcare's decision (the Second AAT Decision). It found that, as at 2 March 2009, Ms Dunkerley did not suffer from a "Axis 1 psychiatric disorder", and did not at that time suffer incapacity for work nor require further medical treatment for the injury suffered on 24 October 2007. The Second AAT Decision is reported as Re Dunkerley and Comcare [2014] AATA 381.
40 Before returning to the judgment of Griffiths J it is appropriate to consider the judgments of Perram J, Flick J and Rares J in more detail.
41 The issues before Perram J were limited. It was an appeal to this Court from orders made by the Tribunal (Second AAT Decision). Ms Dunkerley represented herself. The Tribunal had dismissed her application for review of an earlier decision made by Comcare. The decision was that the respondent was not entitled to compensation for medical treatment expenses or incapacity for work under the SRC Act. The injury in question occurred in October 2007. Both Comcare and the Tribunal concluded that the injury had resolved by March 2009 and, in any event, had been completely supplanted by a non-compensable injury suffered in July 2009: at [1]. Perram J stated at [12] that the respondent's claim was "one for aggravation of her pre-existing condition" and that it was treated as such by all concerned but that liability was declined on the basis that the conduct which underpinned the aggravation was "reasonable administrative action" within the meaning of s 5A(2) of the SRC Act. Perram J identified the respondent's contentions at [21] as threefold. First, the medical certificates she had obtained at the time of the incident with Mr Schwager all referred to the condition as an exacerbation of her pre-existing 2007 adjustment disorder, and neither Comcare, nor subsequently the Tribunal, were permitted to approach the matter on the basis that the earlier 2007 injury was not relevant. Second, the Tribunal used the opinion of doctors other than those who had issued the medical certificates and, in particular, that of Dr George of 10 March 2009, to arrive at the view that the 2007 injury was not causing any ongoing disability, which they were not entitled to do. Third, the hearing before the Tribunal involved a miscarriage of justice, in that Comcare had failed to clarify for the Tribunal what her case was, which was a breach of Comcare's obligations as a model litigant. Perram J concluded that the appeal was devoid of merit: at [22]. His Honour concluded that, neither the Tribunal nor Comcare were bound by the medical certificates which she had obtained in respect of the conduct which underpinned the aggravation of her pre-existing 2007 adjustment disorder; the Tribunal did not err in relying upon Dr George's opinion in concluding that the 2007 injury was not causing the respondent any ongoing disability; and Comcare had not behaved inappropriately and, in any event, a breach of the Model Litigant Guidelines had no consequence in civil litigation: at [22]-[26]. Perram J also observed that in his view "the proceedings are beginning to border on the vexatious": at [28]. The proceedings were dismissed with costs.
42 As previously mentioned, Ms Dunkerley appealed the orders made by Perram J. That proceeding was case managed by Flick J. On 10 June 2015, at a case management hearing, Flick J ordered that the respondent complete an appeal book by 26 June 2015 and file an outline of written submissions by 9 July 2015. A further case management hearing was scheduled. The respondent failed to appear at that case management hearing, held on 23 July 2019. The respondent also failed to comply with the directions made on 10 June 2015. Flick J dismissed the respondent's application because of the combination of the failure to compile the appeal book and associated documents, the failure to file by the prescribed time an outline of submissions which clearly articulated the errors alleged to have been committed by the primary judge, and the failure to identify any ground of appeal which has merit: at [52]-[53]. In reaching that conclusion his Honour considered the grounds of appeal to determine they had no merit. Flick J noted that some of the grounds alleged matters not argued before the primary judge. I pause to note that some of the grounds, in so far as they are able to be identified, resemble arguments advanced by the respondent on this application.
43 Rares J then considered an application for an extension of time and leave to appeal against the orders made by Flick J. His Honour concluded that the Court had no power to grant the relief sought as Flick J was exercising appellate jurisdiction. Rares J also considered alternatives, namely, if it was an application to vary the orders made by Flick J, there was also no power to grant the relief. In any event, Rares J found the application was entirely without merit and an abuse of process: at [10].
44 On or about 12 August 2016, the respondent sought special leave to appeal to the High Court in respect to Rares J's judgment. On 10 November 2016 that application was dismissed on the basis that none of the grounds relied on enjoyed a sufficient prospect of success to warrant the grant of special leave.
45 Against that background it is necessary to return to the judgment of Griffiths J, which addressed the respondent's application challenging the Bankruptcy Notice. That application, at least in part, was also based on the respondent's assertion that the Court should go behind the judgments of Perram J, Flick J and Rares J. Griffiths J concluded that the the respondent had failed to establish any sufficient basis to go behind those judgments which had resulted in the costs orders forming the basis of the Bankruptcy Notice and she had not made good her serious allegations of abuse of process, fraud, and other misconduct by the respondent. Griffiths J expressed that, in effect, the submissions were no more than an attempt to re-litigate the same issues of fact and law that had been considered and rejected in the previous proceedings. The respondent's appeal from that decision to the Full Court was also dismissed: [2020] FCAFC 8.
46 Griffiths J's reasons reflect that, in large part, the submissions relied on by Ms Dunkerley to go behind the earlier judgments in those proceedings are the same as advanced in this Court.
47 As will be apparent from the recitation of the the respondent's submission above, most of her submissions were focused on the judgment of Perram J and, in particular, a purported finding at [11] that there was an injury on 15 July 2009. That paragraph is relevantly as follows: "[o]n 1 September 2009 she made a further claim for compensation based now on a conversation of 15 July 2009 with Mr Schwager". The paragraph is found in the section of the reasons which recites the facts. Properly read, it is plain from the reasons that Perram J did not make any finding, as contended by the respondent. As is apparent from the limited issues before his Honour as identified at [41] above, there was no cause for him to make such a finding.
48 In the course of recounting the outcome of previous proceedings, Perram J stated at [14] that "[a]lthough Ms Dunkerley challenged the Tribunal's conclusion that Mr Schwager's actions were reasonable administrative action, first before me and then before the Full Court, this argument was on each occasion rejected. Ultimately, it was concluded that [Ms Dunkerley] was not entitled to compensation under the Act in respect of Mr Schwager's actions on 15 July 2009". For the purposes of the SRC Act, an employee is taken to have sustained an injury on the day when the employee first sought medical treatment, or was incapacitated for work, whichever was earlier. Consistent with the respondent's claim for compensation, it was agreed by the parties before the Tribunal that the date of the injury for the purposes of the SRC Act was 20 July 2009. This injury was alleged to have occurred as a result of actions taken by Mr Schwager on or after 15 July 2009 (as is apparent from the Tribunal decision exhibited to the affidavit of Ms Mulherin of 26 May 2020, with the Tribunal finding Mr Schwager's actions occurred on 17 July 2009).
49 A proper reading of the reasons reflect that it is plain that Perram J was referring to the events the subject of the claim for the injury which occurred in July 2009, the subject of the appeal: at [1]. In any event, the disposition of the appeal by Perram J did not turn on the precise date on which the actions of Mr Schwager occurred. It was irrelevant to the matters being determined.
50 It follows that the premises of much of the respondent's submission are incorrect.
51 The submission reflects a consistent approach by the respondent in which she advances a submission based on a statement in a judgment taken out of context, and then attributes to it a meaning it does not have and claims that it results in an entitlement to compensation.
52 The balance of the respondent's submissions are a repetition of arguments previously advanced and rejected.
53 For example, there was no finding of fact by Perram J at [12] that the respondent had suffered an exacerbation of her original injury in 2009, as she asserted. Rather, at [12] Perram J noted that was the way the previous proceedings had been conducted: and see Griffiths J at [71]. Contrary to the respondent's submission, that also was not a finding, and does not entitle her to compensation. What the respondent fails to recognise is that, as described at [14], the claim was denied because Mr Schwager's actions were considered reasonable administrative action. To take another example, the respondent's complaint about reliance being placed on the report of Dr George and the failure to rely on the medical certificates she provided are matters which were expressly addressed and rejected by Perram J at [22]-[25]. Significantly, these very arguments were also rejected by Griffiths J at [73]-[74] as providing a proper basis to go behind Perram J's judgment. As noted above, the Full Court dismissed the respondent's appeal from the judgment of Griffiths J.
54 The respondent's submissions in relation to the judgments of Flick J and Rares J simply repeat previous arguments.
55 In reality, the respondent seeks to relitigate these proceedings (and her underlying claim). I do not accept the submissions made by her that the applicant did not, during these proceedings, act as a model litigant. Such allegations have been repeatedly made by her and appear to be based on no more than that the applicant disagrees with her arguments or does not do what she contends it ought. That is not a proper basis to make such allegations.
56 It will be recalled that the issue to which this argument is directed is the satisfaction that there is in truth and reality a debt due. Applying the principles referred to above at [31]-[36] and considering each judgment separately (and in combination) the respondent has not established a basis to go behind the judgments of Perram J, Flick J and Rares J.
57 I find there is in truth and reality a debt owing.
58 It remains to consider the two other bases of objection relied on by the respondent.
59 First, as to the issue of solvency, the onus is on the respondent to adduce evidence that she is "able to pay her" her debts within the meaning of s 52(2)(a) of the Bankruptcy Act: Culleton v Balwyn Nominees Pty Ltd [2017] FCAFC 8 at [44].
60 The issue is whether they can pay their debts as they fall due either with immediate cash resources or by realising assets, sufficient to pay the debt, within a relatively short time: Shaw v Yarranova Pty Ltd [2017] FCAFC 88; (2017) 252 FCR 262 (Shaw) at [96], citing Sandell v Porter (1966) 115 CLR 666 (Sandell v Porter) at 670 (in the context of a bankruptcy annulment application).
61 The test was stated by Barwick CJ in Sandell v Porter at 670 as follows:
Insolvency is expressed in s 95 as an inability to pay debts as they fall due out of the debtor's own money. But the debtor's own moneys are not limited to his cash resources immediately available. They extend to moneys which he can procure by realization by sale or by mortgage or pledge of his assets within a relatively short time - relative to the nature and amount of the debts and to the circumstances, including the nature of the business, of the debtor. The conclusion of insolvency ought to be clear from a consideration of the debtor's financial position in its entirety and generally speaking ought not to be drawn simply from evidence of a temporary lack of liquidity. It is the debtor's inability, utilizing such cash resources as he has or can command through the use of his assets, to meet his debts as they fall due which indicates insolvency.
62 Recently, in Kessly v Beadle as Trustee of the Bankrupt Estate of Evangelina Francisca Kessly [2020] FCA 607, Burley J having referred to Sandell v Porter and the passage recited above, considered the case of Shaw at [56]-[57]:
[56] In Shaw the bankrupt sought to establish that he was able to pay his debts as they fell due at the relevant time and that his bankruptcy should be annulled on that basis. In the primary judgment of Shaw v Yarranova Pty Ltd [2016] FCA 88, Pagone J accepted that Mr Shaw had owned assets at the time of the sequestration proceedings in excess of the judgment debts owed by him to the respondents. His Honour went on to say at [10]:
...The availability of those assets are relevant to Mr Shaw's solvency as at the date of making of the sequestration order but it is not sufficient to establish solvency for Mr Shaw to say that he had assets that could be realised without having taken any steps to do so or without showing that he could do so within a relatively short time: Stankiewicz v Plata [2000] FCA 1185, [30]-[32]; Reaper v Baycorp Collections PDL (Australia) Pty Ltd [2014] FCA 13, [11]. Mr Shaw has not demonstrated that in May 2014, or if relevant, at any time thereafter, he was in a position to 'realise assets, sufficient to pay the debt, within a relatively short time': Stankiewicz, [30]...
[57] Pagone J held that it would be necessary for the bankrupt to sell one or more of his properties in order to discharge his liabilities, which he was unable to do so in a "relatively short" or "reasonable" period of time and therefore he had failed to establish his solvency. The Full Court upheld this conclusion, accepting as an underlying premise of the primary judge's findings that all of the judgment debts owed by the bankrupt were immediately due and payable (at [100]), and that the bankrupt had not discharged the onus on him to demonstrate an ability to sell the assets. A lack of demonstrated ability to pay in a reasonable or relatively short period of time meant that he was not able to establish solvency.
63 Initially, the respondent provided some evidence that she is one of two registered proprietors of a property in Curtin in the Australian Capital Territory (Curtin Property). She also advised the applicant that she has an asset in the form of superannuation. The applicant in its written submission contended that there was a lack of evidence provided by the respondent, including there being no evidence of the value of the Curtin Property, whether it is subject to any unregistered interests, whether the respondent holds the property on trust for a third party, or the respondent's ability to realise proceeds from the sale of the Curtin Property within a relatively short time. It was also submitted that there was no evidence before the Court whether the respondent has the ability to pay her debts within a relatively short period of time out of her superannuation. There was no evidence of liabilities. It was submitted that the Court cannot be satisfied that the respondent is able to pay her debts.
64 As a result the respondent adduced further evidence, but only in relation to her superannuation. The applicant submitted that at best, the effect of the additional evidence is that, as a member of the Public Sector Superannuation Scheme, the respondent will, on retirement, be entitled to receive a benefit under the Scheme of unknown value. It was put that despite being on notice of the applicant's submissions and being given an opportunity to do so, the respondent has adduced no further evidence as to her ability to realise proceeds from the sale of the Curtin Property within a relatively short time. The respondent has not otherwise adduced evidence of her financial resources. The respondent has not adduced evidence of her liabilities. There is evidence to suggest that the respondent has liabilities beyond the debts the subject of the Creditor's Petition.
65 Given the onus and her position to adduce evidence, the Court may more confidently draw an inference that such liabilities exist and that the uncalled evidence and any untendered documents would not have assisted the respondent's case, referring to Sagacious Legal Pty Ltd v Wesfarmers General Insurance Ltd [2011] FCAFC 53 at [78]-[79].
66 I note that the Court has a discretion to make a sequestration order even if satisfied that the debtor is able to pay his or her debts: Dunn, in the matter of Dunn v Vangsnes [2000] FCA 1051 at [17]. As Hely J observed at [18]:
Section 52(2)(a) envisages a situation which will probably bear fruit in payment. It is not easy to see any other reason why the legislature makes demonstration of ability to pay only a discretionary ground of dismissal of the petition, and not an absolute bar to its success. The decision of Finn J in Re Capel; Ex parte Caram Finance Australia Limited (unreported) 9 April 1998 is an illustration of a case in which, even if the Court had been satisfied that a particular asset was available to the debtor, it would have been appropriate nonetheless to exercise the discretion in favour of making a sequestration order, because the debtor had no assets or income that could be reached by execution or garnishment.
And see: Knudsen & Yates trading as The Hargreaves Practice, in the matter of Sanders v Sanders [2003] FCA 1079 at [51]; Kitay at [8], [120], [126].
67 The evidence relied on by the respondent is lacking. At best the respondent can access her superannuation fund at some time, but has not. She claims to have money to pay the debts, but she has not done so because she claims they are not properly owing. As apparent from the analysis above, there is no proper basis to challenge that proposition, yet she has chosen to do so based primarily on matters already repeatedly rejected by this Court.
68 Despite being on notice as to the adequacy of the evidence, the respondent has not put on any other evidence of her finances. The position in relation to the Curtin Property is unclear. There is no evidence as to liabilities, although at the very least there are other costs orders that have been made in this Court. Accepting that Ms Dunkerley is unrepresented, it would nonetheless be expected that such evidence would have been provided. The respondent has had ample opportunity to do so and is aware of the significance of the issue of solvency. This is particularly so given her ability to rely on evidence or put matters before the Court when she desires to do so. She has chosen not to.
69 There is no sufficient evidence that the respondent has the ability to realise any purported assets sufficient to pay her debts within a relatively short time, or that she has taken any steps to do so: see [59]-[62]. This is in a context where the debts have been outstanding for some considerable time.
70 Second, the order was opposed on the basis the applicant refused to discuss a pay by installment arrangement with the respondent. That does not provide a basis to decline to make the order. These debts have been owing for some considerable time with no amount paid off. The applicant was not bound to discuss whether the respondent is able to pay by way of installment payments. This is also in the context in which she is declining to pay because she claims the money is not owed.
71 I am satisfied as to the matters required by s 52 of the Bankruptcy Act. I see no sufficient reason not to make the sequestration order. I order that a sequestration order under the Bankruptcy Act be made against the estate of Ulla-Maija Katriina Dunkerley. I order that the applicant creditor's costs (including reserved costs) be taxed and paid from the estate of the respondent debtor in accordance with the Bankruptcy Act.
I certify that the preceding seventy-one (71) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Abraham.