Coshott v Crouch

ALLSOP CJ: 1 This matter involves an appeal by Mrs Ljiljana and Mr Robert Coshott from a primary judge's conduct of a de novo review of a determination of a Registrar of this Court under s 35A(5) of the Federal Court of Australia Act 1976 (Cth) which had determined the amounts to be paid to the first and second respondents, Mr Crouch and Ms Amirbeaggi, as trustees for sale appointed pursuant to orders made by a judge of the Court, Buchanan J, on 16 October 2015. 2 The background and procedural history is as follows. The trustees for sale had been appointed in respect of a Court ordered sale of a property in Bellevue Hill, Sydney, which was required to be sold in order to meet costs associated with the administration of the bankruptcy of the second appellant, Mr Robert Coshott. The property was originally owned by the appellants as joint tenants, but had been changed to a tenancy-in-common upon the bankruptcy of Mr Coshott, with the tenants in common being Mrs Coshott and Mr Coshott's trustee in bankruptcy, Mr Prentice. Mr Prentice is the third respondent to this appeal and has filed a submitting appearance. 3 Buchanan J made orders appointing a trustee for sale of the property on 10 September 2013: see Coshott v Coshott [2013] FCA 907. His Honour originally appointed the trustee in bankruptcy, Mr Prentice, as the trustee for sale. The orders of Buchanan J made on 10 September 2013 were as follows: In respect of the application in this Court in NSD 1412 of 2009 THE COURT ORDERS THAT: 1. The application filed in the Supreme Court of New South Wales on 24 June 2009, later transferred to this Court, is dismissed. 2. The applicants in this Court are to pay the costs of the second respondent, as taxed, on an indemnity basis. In respect of the further amended cross-claim in this Court in NSD 1412 of 2009 THE COURT DECLARES THAT: 3. The property 1 Bunyula Road, Bellevue Hill being the whole of the land contained in Certificate of Title Folio Identifier 2/336490 ("the property") was acquired by the second cross-respondent and the third cross-respondent beneficially as joint tenants. 4. Upon the date of bankruptcy of the third cross-respondent, the joint tenancy between the second cross-respondent and the third cross-respondent in the property was severed and the ownership became: 4.1 the second cross-respondent as to an undivided one half share; 4.2 the cross-claimant as to an undivided one half share as tenants in common. 5. The half interest in the property registered to the third cross-respondent vested in the cross-claimant pursuant to sections 58, 115(1) and 116(1) of the Bankrupty Act 1966 (Cth) [sic], as and from the date of the commencement of the bankruptcy of the third cross-respondent. THE COURT ORDERS THAT: 6. The property vest in the cross-claimant as trustee for sale. 7. The property be sold by the cross-claimant as trustee for sale, with all the obligations and privileges pertaining thereto (including signing for and on behalf of the second cross-respondent any contract for the sale of land and any transfer pursuant to the Real Property Act 1900 (NSW) and determining the price at which the property is to be sold) and the proceeds after payment of all expenses of and incidental to such sale to be divided equally between the cross-claimant and second cross-respondent, pursuant to order 11. 8. For the purposes of giving effect to order 7, the second cross-respondent, by herself her servants and agents do all such things, acts and deeds and sign all documents to list for sale and sell the property, and for that purpose, including but not limited to the following: 8.1 maintain the property in a clean and presentable manner as required for the proper and effective marketing of the property; 8.2 allow and permit for an inspection of the property on 24 hours notice of a request made by the cross-claimant or agent for sale. 9. Each cross-respondent deliver up vacant possession of the property 42 days from these orders. 10. Pending the sale of the property and to the extent to which she is able, the second cross-respondent shall continue to meet one half of the outgoings (including electricity, gas, telephone and council rates) in respect of the property. 11. Upon completion of the sale of the property, the proceeds thereof be distributed in the following manner and priority: 11.1 Firstly, in discharge of any valid encumbrance over the title to the Property; 11.2 Secondly, in payment of agent's commission, auctioneers and auction fees associated with the sale of the property; 11.3 Thirdly, expenses and reasonable legal costs and disbursements incurred upon the sale of the property; 11.4 Fourthly, in adjustment of council rates, water rates and other statutory imposts; 11.5 Fifthly, in payment of the cross-claimant's professional and legal costs of the proceedings; 11.6 Sixthly, and subject to orders above, the remains to be divided equally between the cross-claimant and the second cross-respondent subject to any charge or lien. 12. The cross-respondents are to pay the costs of the cross-claimant, as taxed, on an indemnity basis. 4 These orders were the subject of an appeal to the Full Court, which partially overturned the orders made: see Coshott v Prentice [2014] FCAFC 88; 221 FCR 450. The Full Court overturned the orders appointing Mr Prentice as the trustee for sale on the basis that the relevant statutory provision for the appointment of such a trustee in this case was s 66G of the Conveyancing Act 1919 (NSW) picked up by s 79 of the Judiciary Act 1903 (Cth) rather than s 30 of the Bankruptcy Act 1966 (Cth). Pursuant to s 66G, at least two individual trustees or a corporate trustee had to be appointed. It followed that Mr Prentice could not be appointed as the only trustee for sale. As a consequence, the Full Court made the following orders on 23 July 2014: THE COURT ORDERS THAT: 1. The appeal is dismissed subject to orders 2, 3 and 4. 2. The appointment of the cross-claimant as the trustee for sale is set aside. 3. Order 11.5 of the orders below is set aside and substituted by the following order: "Fifthly, and from the proceeds of the sale of the half interest in the property vested in the cross-claimant, in payment of the cross-claimant's professional and legal costs of the proceedings;" 4. The matter be remitted to the primary judge to appoint a corporate trustee or individual trustees for sale under s 66G of the Conveyancing Act 1919 (NSW) as applied by s 79 of the Judiciary Act 1903 (Cth). 5. The question of costs be reserved. 6. The parties notify the Court within seven days as to whether they wish to be heard on the question of costs or are content for the Court to make orders to the effect of those foreshadowed in these reasons for judgment. 5 Pursuant to order 4 of the orders made by the Full Court, the matter was remitted to Buchanan J. On 19 September 2014, Buchanan J appointed the first and second respondents as the trustees for sale and made orders on that day as follows: THE COURT ORDERS THAT: 1. Matters NSD 1412/2009, NSD 916/2014 and NSD 917/2014 be hereafter and subject to any further order of the Court heard together. 2. In substitution for order 6 made on 10 September 2013 and set aside by the Full Court of the Federal Court on 23 July 2014 the following order: - "6. That Shabnam Amirbeaggi and Nicholas Crouch both of Crouch Amirbeaggi, Suite 403, 55 Lime Street, King Street Wharf, Sydney NSW 2000 and both registered Trustees in Bankruptcy be appointed Trustees for Sale ("Trustees for Sale") and they be entitled to charge their remuneration at the rate set out in the rates attached to their Consent filed in these proceedings." 3. Order 7 made on 10 September 2013 be amended by the deletion of the words "cross-claimant as trustee for sale" and insertion of the words "Trustees for Sale" in lieu thereof. 4. As ordered by the Full Court of the Federal Court on 23 July 2014 order 11.5 is duly amended to read: - "11.5 Fifthly, and from the proceeds of the sale of the half interest in the property vested in the cross-claimant, in payment of the cross-claimant's professional and legal costs of the proceedings." 5. That, prior to the distribution in order 11.6 made 10 September 2013 the Trustees for Sale be entitled to deduct their remuneration, costs and expenses of acting as Trustees for Sale. 6. That the Trustees for Sale have liberty to apply for directions in relation to the performance of their duties on 3 days' notice. 7. Costs are reserved. 8. Liberty to apply on 3 days' notice. 6 Order 5 of the orders made by Buchanan J on 19 September 2014 entitled the first and second respondents to deduct their remuneration, costs and expenses of acting as trustees for sale. Buchanan J made several subsequent orders on 2 October 2015, 16 October and 26 October 2015 in relation to the appointment and remuneration payable to the trustees. 7 Order 5 of the orders of 19 September 2014, was later, as will be seen, vacated by Buchanan J. That was so, because, plainly, it was an order that was consequential upon order 11.6 that was made on 10 September 2013, and order 11.6 was, after the Full Court hearing, one that was convenient to vacate. I mention this because, as will be seen later in these reasons, the vacation of order 5 made on 19 September 2014 is important for some submissions put before the Court today. 8 On 2 October 2015, Buchanan J made the following orders: THE COURT ORDERS THAT: 1. Order 11 made on 10 September 2013 be amended by the deletion of the word "Upon" and the insertion of the words "As soon as practicable following" in lieu thereof. 2. The matter be listed for further directions at 9.30 am on 16 October 2015. 9 On 16 October 2015, Buchanan J made the following orders: THE COURT ORDERS THAT: 1. Ljiljana Coshott (and Robert Coshott if so advised) file and serve any further evidence and an outline of submissions in respect of the interlocutory application of Barry and Board on or before 27 October 2015. 2. Barry and Board (and Prentice if so advised) file and serve any evidence in reply and an outline of submissions in respect thereof on or before 3 November 2015. 3. The interlocutory application filed by Barry and Board be listed for hearing before Buchanan J at 10.15 am on 10 November 2015. 4. The application for the relief sought in paragraphs 6, 7 and 8 of the interlocutory application filed on 8 July 2015 on behalf of the Trustees for Sale be listed for directions at 10.15 am on 10 November 2015. 5. The Trustees for Sale would be justified in not taking any further steps to recover from Fewin Pty Ltd, their costs the subject of the orders of this Court made on 14 January 2015, being costs of and incidental to the interlocutory application filed by Fewin Pty Ltd on or about 17 December 2014 in these proceedings. 6. A Registrar be appointed to determine the amounts to be paid to the Trustees for Sale pursuant to the orders of the Court made on 10 September 2013 and 19 September 2014, including: (a) in respect of the fees and disbursements (not including legal costs) payable to the Trustees for Sale pursuant to order 6 of the orders of the Court made on 10 September 2013 and substituted on 19 September 2014; (b) in respect of the legal costs of the Trustees for Sale (on a solicitor and own client basis) including pursuant to order 11.3 of the orders of 10 September 2013 and order 5 of the orders of the Court made on 19 September 2014. 7. The proceedings be otherwise listed for directions at 10.15 am on 10 November 2015. 8. The parties have liberty to apply on 3 days' notice. 10 On 26 October 2015, Buchanan J made the following orders: THE COURT ORDERS THAT: 1. Order 11.5 (as amended on 19 September 2014), Order 11.6 as made on 10 September 2013 and Order 5 as made on 19 September 2014 all be vacated. 2. From the proceeds of sale of the property, the Trustees for Sale be entitled to deduct their remuneration, costs and expenses of acting as Trustees for Sale. 3. When reasonably practicable, the Trustees for Sale make interim and final distributions of the proceeds of sale to the cross-claimant and the second cross respondent, after taking account of any orders for the payment of money into Court, or the need to withhold money on account of any claim foreshadowed against the Trustees for Sale or on account of their further likely professional costs and disbursements. 4. The cross-claimants' professional and legal costs of the proceedings (including the costs of the former Trustee in Bankruptcy) be paid from the proceeds of the sale of the half interest in the property vested in the cross-claimant. 11 Order 1 made on 26 October is the order in which his Honour vacated various orders. When examined, that was necessary and convenient for the further implementation of the orders of the Full Court. The final form of the recompense and appointment orders were helpfully summarised by the primary judge, Bromwich J, in [24] to [25] of the decision under appeal as follows: [24] The final form of the orders made on the present topic of the recompense to which the Trustees for Sale were entitled was as follows, merging the relevant part of the original orders with the relevant amendments as demonstrated by the mark-up: In respect of the application in this Court in NSD 1412 of 2009 THE COURT ORDERS THAT: 1. The application filed in the Supreme Court of New South Wales on 24 June 2009, later transferred to this Court, is dismissed. 2. The applicants in this Court are to pay the costs of the second respondent, as taxed, on an indemnity basis. In respect of the further amended cross-claim in this Court in NSD 1412 of 2009 THE COURT DECLARES THAT: 3. The property 1 Bunyula Road, Bellevue Hill being the whole of the land contained in Certificate of Title Folio Identifier 2/336490 ("the property") was acquired by the second cross-respondent and the third cross-respondent beneficially as joint tenants. 4. Upon the date of bankruptcy of the third cross-respondent, the joint tenancy between the second cross-respondent and the third cross-respondent in the property was severed and the ownership became: 4.1 the second cross-respondent as to an undivided one half share; 4.2 the cross-claimant as to an undivided one half share as tenants in common. 5. The half interest in the property registered to the third cross-respondent vested in the cross-claimant pursuant to sections 58, 115(1) and 116(1) of the Bankrupty Act 1966 (Cth), as and from the date of the commencement of the bankruptcy of the third cross-respondent. THE COURT ORDERS THAT: 6. The property vest in the cross-claimant as trustee for sale. That Shabnam Amirbeaggi and Nicholas Crouch both of Crouch Amirbeaggi, Suite 403, 55 Lime Street, King Street Wharf, Sydney NSW 2000 and both registered Trustees in Bankruptcy be appointed Trustees for Sale ("Trustees for Sale") and they be entitled to charge their remuneration at the rate set out in the rates attached to their Consent filed in these proceedings. [Substituted 19 September 2014] 7. The property be sold by the cross-claimant as trustee for sale Trustees for Sale [amended 19 September 2014], with all the obligations and privileges pertaining thereto (including signing for and on behalf of the second cross-respondent any contract for the sale of land and any transfer pursuant to the Real Property Act 1900 (NSW) and determining the price at which the property is to be sold) and the proceeds after payment of all expenses of and incidental to such sale to be divided equally between the cross-claimant and second cross-respondent, pursuant to order 11. 8. For the purposes of giving effect to order 7, the second cross-respondent, by herself her servants and agents do all such things, acts and deeds and sign all documents to list for sale and sell the property, and for that purpose, including but not limited to the following: 8.1 maintain the property in a clean and presentable manner as required for the proper and effective marketing of the property; 8.2 allow and permit for an inspection of the property on 24 hours notice of a request made by the cross-claimant or agent for sale. 9. Each cross-respondent deliver up vacant possession of the property 42 days from these orders. 10. Pending the sale of the property and to the extent to which she is able, the second cross-respondent shall continue to meet one half of the outgoings (including electricity, gas, telephone and council rates) in respect of the property. 11. Upon As soon as practicable following [amended 2 October 2015] completion of the sale of the property, the proceeds thereof be distributed in the following manner and priority: 11.1 Firstly, in discharge of any valid encumbrance over the title to the Property; 11.2 Secondly, in payment of agent's commission, auctioneers and auction fees associated with the sale of the property; 11.3 Thirdly, expenses and reasonable legal costs and disbursements incurred upon the sale of the property; 11.4 Fourthly, in adjustment of council rates, water rates and other statutory imposts; 11.5 Fifthly, in payment of the cross-claimant's professional and legal costs of the proceedings; [substituted to read as per the next paragraph 11.5 by orders 23 July 2014 and 19 September 2014] 11.5 Fifthly, and from the proceeds of the sale of the half interest in the property vested in the cross-claimant, in payment of the cross-claimant's professional and legal costs of the proceedings; [Vacated 26 October 2015 and replaced by orders 2, 3 and 4 below] 11.6 Sixthly, and subject to orders above, the remains to be divided equally between the cross-claimant and the second cross-respondent subject to any charge or lien. [Vacated 26 October 2015 and replaced by orders 2, 3 and 4 below] 2. From the proceeds of sale of the property, the Trustees for Sale be entitled to deduct their remuneration, costs and expenses of acting as Trustees for Sale. 3. When reasonably practicable, the Trustees for Sale make interim and final distributions of the proceeds of sale to the cross-claimant and the second cross respondent, after taking account of any orders for the payment of money into Court, or the need to withhold money on account of any claim foreshadowed against the Trustees for Sale or on account of their further likely professional costs and disbursements. 4. The cross-claimants' professional and legal costs of the proceedings (including the costs of the former Trustee in Bankruptcy) be paid from the proceeds of the sale of the half-interest in the property vested in the cross-claimant. 12. The cross-respondents are to pay the costs of the cross-claimant, as taxed, on an indemnity basis. [25] The orders for recompense of the Trustees for Sale and for the appointment of the Registrar to determine the amounts they should be paid, as in force at the time that the Registrar came to make that determination, were as follows in aid of considering the arguments of the parties below (emphasis added): Order 6 made 10 September 2013, after being set aside by the Full Court and substituted by Buchanan J on 19 September 2014: 6. That Shabnam Amirbeaggi and Nicholas Crouch both of Crouch Amirbeaggi, Suite 403, 55 Lime Street, King Street Wharf, Sydney NSW 2000 and both registered Trustees in Bankruptcy be appointed Trustees for Sale ("Trustees for Sale") and they be entitled to charge their remuneration at the rate set out in the rates attached to their Consent filed in these proceedings. Order 7 made 10 September 2013, after being varied on 19 September 2014: 7. The property be sold by the Trustees for Sale, with all the obligations and privileges pertaining thereto (including signing for and on behalf of the second cross-respondent any contract for the sale of land and any transfer pursuant to the Real Property Act 1900 (NSW) and determining the price at which the property is to be sold) and the proceeds after payment of all expenses of and incidental to such sale to be divided equally between the cross-claimant and second cross-respondent, pursuant to order 11. Order 6 made on 16 October 2015 6. A Registrar be appointed to determine the amounts to be paid to the Trustees for Sale pursuant to the orders of the Court made on 10 September 2013 and 19 September 2014 [necessarily as varied since being made], including: (a) in respect of the fees and disbursements (not including legal costs) payable to the Trustees for Sale pursuant to order 6 of the orders of the Court made on 10 September 2013 and substituted on 19 September 2014; (b) in respect of the legal costs of the Trustees for Sale (on a solicitor and own client basis) including pursuant to order 11.3 of the orders of 10 September 2013 and order 5 of the orders of the Court made on 19 September 2014. Orders 2, 3 and 4 made on 26 October 2015 in substitution for: order 11.5 originally made 10 September 2013 and varied on 23 July 2014 and 19 September 2014; and order 11.6 originally made on 10 September 2013 2. From the proceeds of sale of the property, the Trustees for Sale be entitled to deduct their remuneration, costs and expenses of acting as Trustees for Sale. 3. When reasonably practicable, the Trustees for Sale make interim and final distributions of the proceeds of sale to the cross-claimant and the second cross respondent, after taking account of any orders for the payment of money into Court, or the need to withhold money on account of any claim foreshadowed against the Trustees for Sale or on account of their further likely professional costs and disbursements. 4. The cross-claimants' professional and legal costs of the proceedings (including the costs of the former Trustee in Bankruptcy) be paid from the proceeds of the sale of the half interest in the property vested in the cross-claimant. 12 So that the balance of these reasons are clear, it should be noted that the substituted order 6 made by Buchanan J on 19 September 2014 (against which there has been no appeal) only referred to the remuneration of the trustees for sale. That is because one part of that order was dealing with their entitlement to charge, in effect, their professional costs, being their remuneration at the rate set out in the document attached to their consent that had been filed. 13 The order appointing them did not expressly say that they were entitled to undertake costs and expenses necessary for their task. It did not need to do so. They were being appointed trustees for sale by the Court, plainly with power to undertake necessary costs and expenses, if need be, legal expenses, to perform their task. What they needed authority and entitlement for before they began was the rates of remuneration that they were to charge. Of course, if their costs and expenses, in due course, were otherwise than reasonable, this would be dealt with on a review of their remuneration, costs and expenses. 14 The argument to which I will come of the Coshotts before the primary judge and before us on appeal was and is that the referral of the matter to the Registrar for the determination of what the trustees were entitled to was limited to remuneration in relation to the selling of the property and, implicitly, does not extend to costs and expenses. I will come to that argument. As was appreciated by the primary judge in the judgment under appeal, no appeal was instituted against any of the orders made by Buchanan J except for the appeal previously dealt with by the Full Court as discussed above. 15 The form of order, still extant, dealing with the determination was order 6 made on 16 October 2015. The chapeau to that order stated that the Registrar be appointed to determine the amounts to be paid to the trustees for sale pursuant to the orders of the court on 19 September 2014, including fees and disbursements and including the legal costs of the trustee. 16 The order of 26 October 2015 entitled the trustees for sale to deduct their remuneration, costs and expenses of acting as trustees for sale. One aspect of the argument of the appellants is that, in some fashion, all the Registrar was entitled to determine was the remuneration of the trustees for sale (and not costs and expenses). This argument should be rejected. Plainly, the existing orders not vacated were wide enough to include remuneration, costs and expenses. 17 I will come to the second aspect of the construction of the order in due course, this latter argument being the argument that was put to the primary judge, Bromwich J. 18 The matter then came before the Registrar to determine the amounts payable to the trustees. A hearing was held before the Registrar at which the appellants did not participate. There was some explanation given to Bromwich J that the solicitor was hospitalised on this occasion. No application for an adjournment was made before the Registrar, and the Registrar was not given this information. The trustees made oral and written submissions and there was detailed material placed before the Registrar. Following that hearing on 16 May 2016, the Registrar made the following determination: THE REGISTRAR DETERMINES THAT: 1. The amount to be paid to the Trustees for Sale pursuant to the orders of the Court made on 10 September 2013 and 19 September 2014 is $761,810.53 which is comprised as follows: a. $322,355.44 inclusive of GST in respect of the Trustees' remuneration; b. $143,661.68 inclusive of GST in respect of disbursements (not including legal costs); c. $260,138.45 for professional fees payable to the Trustees' solicitors; and d. $35,654.96 for disbursements incurred by the Trustees' solicitors. THE REGISTRAR NOTES: 2. The amounts referred to in paragraph 1 include amounts for the Trustees' remuneration, disbursements (other than legal costs), and legal costs which will be incurred after the date of this determination and which have been estimated as follows: a. $27,500.00 inclusive of GST in respect of the Trustees' remuneration; b. $ nil amount in respect of disbursements (not including legal costs); c. $24,502.50 for professional fees payable to the Trustees' solicitors; and d. $22,000.00 for disbursements incurred by the Trustees' solicitors. 3. The undertaking given to the Court by the Trustees for Sale that in the event the amounts actually incurred in respect of remuneration and disbursements, including legal costs, after the date of this determination is less than the amounts estimated in paragraph 2 above they will pay the difference between the amounts actually incurred and the amounts estimated in accordance with the orders of the Court of 10 September 2013. 19 The Registrar thus determined that the trustees were to be paid $761,810.53 out of the proceeds for sale of the property. 20 The appellants filed an interlocutory application seeking review of that determination ostensibly under s 35A of the Federal Court of Australia Act. That application was heard by the primary judge, Bromwich J, on 16 September 2016, and he delivered judgment on 21 December 2016, dismissing the application for review of the determination: see Coshott v Coshott [2016] FCA 966. 21 There were three issues raised by the appellants before the primary judge. The first related to the scope of the recompense orders made by Buchanan J and the nature and scope of what the trustees were entitled to be paid. The second related to the jurisdiction of the Federal Court to make orders for recompense for the trustees for sale. The third and final issue was the de novo review under s 35A of the Federal Court of Australia Act of the determination made by the Registrar on 16 May 2016. The primary judge considered at [15] that only the third issue was properly before him on an application for review under s 35A, however, he proceeded to address all three issues. 22 In respect of the first issue, Bromwich J rejected a submission that the recompense orders should be construed narrowly and concluded that the nature of the appointment, and so the recompense orders, should be read as encompassing the full, fair and reasonable remuneration, costs and expenses of acting as trustees for sale. The terms of Buchanan J's orders did not limit the amounts payable to the trustees to those relating to the actual sale process, but extended to all activities which reasonably took place during the period of acting as trustees for sale. For the reasons I will express below, I agree with that approach to the orders. It is both practical, based on commonsense, and in accordance with a fair reading of the words used. 23 The primary judge rejected the appellant's second round of complaint on the basis that s 23 of the Federal Court of Australia Act conferred the necessary incidental power to make the recompense orders where an appointment for trustees for sale had been made under s 66G of the Conveyancing Act, as picked up by s 79 of the Judiciary Act . He also noted this argument was an attempt to collaterally attack the orders of Buchanan J without appealing from them. This ground is not propounded on appeal and plainly correctly, if I may respectfully say so. 24 In any event, the primary judge conducted a de novo review of the Registrar's determination, which was the proper issue before his Honour on the application. He undertook a detailed examination of that determination. His Honour noted that the appellants had not participated in the proceedings before the Registrar, and had not provided much before him beyond global and general objections. The primary judge considered and distilled a number of the different authorities relating to the nature and scope of a review under s 35A. His Honour concluded from the authorities that there is a reluctance on a review of a Registrar's determination to engage in a process of, or akin to, full taxation. Instead, the role of a judge on review is to ensure the delegation is carried out properly. This was said to particularly be the case where nothing concrete is put forward by a well-represented party that suggests error. Although acknowledging that the absence of objection did not mean the judge is not to employ a careful eye, the primary judge noted that the absence of objection other than at a high level of generality is relevant to a conclusion that there was nothing inherently wrong with any of the tasks carried out by the trustees. 25 The primary judge noted that the appellants had sought before him a second referral to the Registrar so that a line-by-line consideration of the trustee's expenditure could occur. The appellants before Bromwich J did not submit as their primary argument that he should carry out the line-by-line review of expenditure and, as his Honour said, did not point to particular matters that raised doubt about the evidence put before the Registrar and the conclusions of the Registrar. Rather, they said that a line-by-line consideration should be undertaken by an expert costs assessor because of the global and general objections that they took; so, in effect, that the parties should undergo the cost and expense, time and trouble of a second detailed review by someone in the position, in effect, of a taxing officer. 26 This submission was rejected by the primary judge, along with an alternative submission that the primary judge himself conduct a line-by-line examination. His Honour rejected both submissions and his Honour was correct to do so. Bromwich J considered that the appropriate approach for him was to adopt what had been said in Australian Securities and Investments Commission v Letten (No 25) [2016] FCA 1127 at [15], which involved the Court taking a broad approach in determining more generally whether the trustees had justified the reasonableness and prudence of the tasks that they had undertaken. 27 Before embarking on his task, his Honour set out at [61] his interpretation of the recompense order made by Buchanan J as follows: [61] … To put the matter beyond any doubt, I am treating the orders for recompense of the Trustees for Sale made by Buchanan J on 19 September 2014, as amended on 26 October 2015, as extending to all of the payments and liabilities for payment incurred by the Trustees for Sale properly and reasonably paid or incurred in the course of the execution of the statutory trust to which they were appointed, subject only to the process of determination of the proper quantum of that recompense. That is, I read the words used by his Honour literally to mean what they say, namely, that the Trustees for Sale are entitled to "their remuneration, costs and expenses of acting as Trustees for Sale". Those words are easily wide enough to encompass all reasonable steps taken while acting as Trustees for Sale in furtherance of the trust to give effect to the orders for the sale of the property, including dealing with all of the hurdles that so clearly were placed in their way, as indicated in the scope of work required to be carried out in Annexure "A" to Mr Mullette's affidavit of 26 April 2016. That approach ensures that the objective of the statutory trust, the sale and realisation of the proceeds of sale of the property was given "practical effect": Pantzer v Wenkart [2006] FCAFC 140; (2006) 153 FCR 466 at 477 [44]. (emphasis in original) 28 The primary judge then proceeded to review the quantum of recompense determined by the Registrar. It is appropriate to set out the full terms, at this point, of [62] and [63] of his Honour's reasons: [62] As to quantum, I have carefully read each of the affidavits relied upon by the Trustees for Sale. I have perused the time costing records and examined more closely a substantial sample of those entries. I have compared the time costing records with Annexure "A" referred to above and satisfied myself that the various types of work referred to have indeed been carried out. I have also read the transcript of the proceedings before the Registrar and been able to satisfy myself that he did go through a process of analysis and careful consideration, although not line-by-line and not informed by any objections as to any particular items of expenditure or work done. Following my examination, I am satisfied that it cannot be said that the discretion reposed in the Registrar by his appointment has not been exercised, or that any error in the approach taken is apparent. There is nothing to indicate that, given the scope of the orders made for recompense, including the collateral orders approving the rates of remuneration, the approach taken by the Registrar was wrong, let alone manifestly so. In my view, considering all of the evidence as a whole and having regard to the quality of the record-keeping, the Trustees for Sale have properly discharged their onus of justifying the reasonableness and prudence of the tasks they have undertaken, with apparent due regard to the seniority of the person performing the work. There is nothing that I can see that indicates any signs of inefficiency or impropriety. [63] The distribution statement reveals that in November 2015 (I was informed from the bar table, 2 November 2015) a first distribution of $1,238,000 took place, made up of $619,000 to each of the Coshotts. I was informed from the bar table that a second distribution took place on 30 March 2016 of $639,992. The combination of the two distributions was therefore $1,877,992 out of gross sale proceeds of $3,775,000, of which the amount that came to the Trustees for Sale was $3,382,619. The gross amount in the Registrar's determination of $761,810.53 is, on any view, a substantial proportion of the sums received by the Trustees for Sale (some 22.5%), but not inherently disproportionate when regard is had to the many fronts upon which the Trustees for Sale have needed to apply their energies. I am unable to see that the amount alone, in the context of what was done, and in the context of the clear and detailed records kept, gave rise to any sound basis for proportionality concerns. That is especially so when no submission was made on behalf of the Coshotts which demonstrated that any of the steps taken were inappropriate or unreasonable or conducted in an inappropriate or unreasonable fashion. 29 Those paragraphs in their terms make plain that his Honour conducted a de novo review, recognising that he was being guided by the authorities to which he referred. There can be no doubt that his Honour paid attention to the evidence before him in a careful way, examined it and took account of such submissions as placed before him by the party objecting to the determination. The primary judge, for those reasons, said the following at [64] and [65]: [64] In those circumstances, I do not consider that it is necessary or appropriate to carry out a more detailed review of the records before me that I have already described. The approach approved in Templeton has been sufficient for me to form the requisite state of mind in conducting a de novo review of the Registrar's determination. [65] In all circumstances, I am unable to see any proper basis for disturbing the determination made by the Registrar.

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Judgment (6 paragraphs)

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Legislation Cited (6)

Cases Cited (12)