Conlan v Pratt

REASONS FOR JUDGMENT (Revised from the transcript) 1 Before fixing the time for delivery of judgment this morning I had published reasons on 17 January 2013 in relation to the application brought by the applicant (Mr Conlan) in his capacity as liquidator of PB Enterprises (WA) Pty Ltd as described in Conlan v Pratt [2013] FCA 19. The matter was listed for judgment this morning at 10.00 am so that the relief which would follow from those reasons could be considered and orders made. Mr Conlan filed a minute of proposed final orders. 2 The first respondent (Mr Pratt) has travelled a considerable distance to attend Court for the judgment and to make a further submission which he had foreshadowed by affidavit recently filed and served. The solicitors for Mr Conlan did not attend Court to make any submissions concerning that matter or make any submissions in writing. 3 By Mr Pratt's affidavit filed on 5 February 2013 (which is more in the nature of a written submission) he raises the question as to whether or not there was power on the part of a Registrar of this Court to place PB Enterprises (WA) Pty Ltd into liquidation in the first place. He contends today, as he did by that affidavit, that there was no such power because of the High Court decision in The Queen v Davison (1954) 90 CLR 353. Mr Pratt submits the High Court there held that Registrars have 'absolutely no authority to carry out or perform any judicial function'. He also relies on the High Court decision of Lane v Morrison (2009) 239 CLR 230 in support of that contention. 4 There are difficulties with the submission. The first is that Davison was a case concerning what was then the first validly created federal court after the High Court was constitutionally created, namely, the Federal Court of Bankruptcy. It was established in 1930 after the passing of the Bankruptcy Act in 1924. 5 Davison was dealing not with the question of appointment of a liquidator but rather with bankruptcy and the making of a sequestration order upon a debtor's petition. The Federal Court of Bankruptcy no longer exists. The powers of that court were legislatively transferred to this Court, the Federal Court of Australia, in 1977 on the passing of the Federal Court of Australia Act 1976 (Cth) (FCA). This Court is unquestionably a court created under Ch III of the Constitution. 6 In Davison, the High Court, as Mr Pratt submits, held that a Deputy Registrar of the Court could not exercise judicial power in the manner then conferred by s 24(1) of the Bankruptcy Act. Dixon CJ and McTiernan J said (at 370-371) (footnotes omitted): In the present case the thing done is the making of an order characteristic of courts. The primary power to make the very order is entrusted to the court established under ss. 71 and 72. The power of the registrar is secondary and in a sense derivative. Further by the definition of the expression "the Court" the legislature has made it clear that for certain purposes he is to enjoy the very powers conferred upon the court and is to act exactly as the court. This he is to do, although under the peculiar arrangements adopted to meet the decision in Le Mesurier v. Connor, the registrar is no part of the court and is not an officer of the court. It is clear that s. 24 (1) (a) of the Bankruptcy Act confers upon the registrar a power which is also exercisable by the court and a power to be exercised by him in the same way and by the same form of instrument as would be used by the judge. He is, in other words, the substitute for the judge. Within the meaning of s. 54 he is by definition "the Court". By definition also he is the court within the meaning of s. 57. It is therefore his function to decide whether good and sufficient cause exists for refusing to make a sequestration order. Although no doubt it is exceptional for difficulties to arise under this heading, they are by no means unknown; see Re Bachelor; Re Betts; Ex parte Official Receiver; Re Hancock. When s. 24 (1) is construed with the definition of "the Court" and applied to ss. 54 and 57, it becomes clear that the function of making an order of sequestration is treated as judicial and is confided to the registrar in the same character as it is confided to the court. In other words it is the intention of the legislature that the registrar should make an order operating as an order of the court. That is exactly what in fact he did in the present case. For upon its face the order is one which could not be made except by a court constituted as it is in conformity with s. 71 and s. 72 of the Constitution. It follows that what has been done is an attempt to authorize a person not constituting a court under ss. 71 and 72 of the Constitution to exercise part of the judicial power of the Commonwealth and is not authorized by the Constitution. The order of sequestration so made is void. ... 7 But the High Court did nevertheless accept that judicial functions could be executed by an officer of the court such as a Master or a Registrar subject to judicial confirmation or review. 8 This point of law has been re-visited on a number of occasions in a series of cases dealing with the question of delegation of judicial power. The High Court has repeatedly held under Ch III of the Constitution judicial power may be delegated providing that the delegation is subject to the supervision and control by Ch III judges: see Harris v Caladine (1991) 172 CLR 84 and Commonwealth of Australia v Hospital Contribution Fund of Australia (1982) 150 CLR 49. In addition in other courts, mainly this Court, see also Amos v Monsour Pty Ltd (formerly Monsour Legal Costs Pty Ltd) [2010] FCA 741; Totev v Sfar (2008) 167 FCR 193; Re Socket Screw & Fastener Distributors (NSW) Pty Ltd (in prov liq) (1994) 51 FCR 599; Taylor v Deputy Commissioner of Taxation (Cth) (1999) 42 ATR 220; Official Trustee in Bankruptcy v Nedlands Pty Ltd (in liq) (2000) 99 FCR 554 and on appeal in Chisholm v Official Trustee in Bankruptcy [2000] FCA 1234.