The application for reconsideration
4 It is a well established principle that "[a] superior court of justice… has full power to rehear or review a case until judgment is drawn up, passed and entered…": Texas Co (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382 at 457 per Starke J, cited with approval in DJL v Central Authority (2000) 201 CLR 226 at [34] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ. The Federal Court, by reason of s 5(2) of the Federal Court of Australia Act 1976 (Cth), is a superior court of record and, therefore, subject to the necessary factual precondition of the orders having not been entered, has such a power. Additionally, the Court is empowered to vary or set aside a judgment or order before it has been entered under Order 35 rule 7(1) of the Federal Court Rules.
5 The entry of orders in the Federal Court is governed by Order 36 rule 3(1) which states that orders may be entered by authentication (defined in rule 7) either by a Registrar (under rule 3(2)) or a Judge of the Court (under rule 5). In these proceedings, the orders made on 3 December 2010 have not been entered and, therefore, the Court retains the power to review its own decision. It is important to note that entry of the Court's orders onto its computerised system "Casetrack" (which has occurred in this case) does not constitute the entry of orders for the purposes of the Court's rules. So much was recently made clear by the High Court in John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd (2010) 241 CLR 1 at [152].
6 The principles surrounding the Court's power to review its own judgment before its perfection are clear: "[w]hat must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing." (Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 303 per Mason CJ). Because of the importance of the public interest in the finality of litigation, it is a jurisdiction "to be exercised with great caution" (at 302). The onus is on the applicant to demonstrate that he or she has not been heard: Autodesk at 302 citing Wentworth v Woollahra Municipal Council (1982) 149 CLR 672 at 684 per Mason ACJ, Wilson and Brennan JJ.
7 In his affidavit in support of the present application and in the submissions filed on his behalf, Mr Davis puts forward four principal matters which he suggests provide a basis for this Court conducting a review of its reasons: first, so he says, the Court erroneously found that there was no evidence to suggest that he could not meet his child support obligations except by sale of his property in Queensland or by utilising proceeds received from his father's will; secondly, Mr Davis was "unaware it was necessary… to prove [he] was impecunious in order to succeed" and he has thereby been procedurally deprived of an opportunity of putting on such evidence; thirdly, the Court had erred in fact at [21] in concluding that the Queensland property was owned by his wife and should have concluded that it was jointly owned by Mr Davis and his wife at law and in equity; and, fourthly, that the Court had failed to understand his case or deal with his various arguments.
8 In summary, these submissions should all be rejected for the following reasons. First, there was no evidence before the Court during the hearing which suggested that Mr Davis was unable to meet the claims of the Child Support Registrar ("the Registrar"). Secondly, Mr Davis was not "unaware it was necessary… to prove [he] was impecunious in order to succeed" because during the course of the hearing of the appeal his counsel, Mr King, was expressly told by the Bench that the absence of evidence about Mr Davis' impecuniosity had consequences for the leave application. Thirdly, the property being discussed in paragraph [21] of the Court's reasons is the property referred to in paragraph [20] and that, in turn, is Mr Davis' wife's claim for the economic harm caused to her by the enforcement of the orders against his interest in the land. In any event, if it mattered, contrary to Mr King's submissions, Mr Davis is no longer the registered proprietor of an interest in the Queensland property, that interest having already been transferred to the Registrar. Fourthly, the Court expressly dealt with each of the matters raised during the hearing. It is necessary to deal with these points in turn.
9 Mr Davis swears in his affidavit of 8 December 2010 that "[c]ontrary to the statement of the Court I do not have the financial ability to meet the child support debt claimed…", referring to the Court's reasons at paragraph [3] and Part V. By Part V, we take that to be a reference to paragraph [13] of the reasons for judgment which reiterated what was stated at paragraph [3]. What the Court found at paragraph [3] was that it was "not suggested" by Mr Davis that he was unable to meet his child support obligations. On the application for a rehearing Mr Davis accepted that he did not lead evidence at the original hearing before the Full Court of his inability to meet those obligations. He has now led additional evidence on the application for a rehearing which, he submits, demonstrates his inability to satisfy those obligations. However, that is not the question. The public interest in the finality of litigation does not permit the losing side to reopen a case just because, in retrospect, it can be seen that better evidence about some matter in dispute might have changed the result. Were it otherwise, there would be no end to litigation. It is for that reason that the passages cited above from Autodesk Inc v Dyason (No 2) emphasise that an applicant for a rehearing is obliged to show not just that the Court's original factual conclusion is incorrect but that the Court's misapprehension of the facts "cannot be attributed solely to the neglect or default of the party seeking the rehearing".
10 That test directs attention to the manner in which the application for leave to appeal was conducted on Mr Davis' behalf. To obtain a grant of leave to appeal Mr Davis had to prove substantial injustice would ensue were leave not to be granted. That was a requirement directly flowing from Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 which is a rudimentary aspect of appellate practise. The sale of a non-residential asset - the property in question was a rental property - and the reduction of Mr Davis' debt by the proceeds of sale did not affect Mr Davis' net asset position in any material way (leaving aside sale expenses). It was not a family home and neither Mr Davis nor his wife were living in it. The difficulties this presented in establishing substantial prejudice were leave not to be granted were at once obvious for it is difficult to discern any substantial injustice in permitting an undisputed creditor to levy execution against a debtor's non-residential assets when the debtor simply refuses to pay. It was therefore necessary for Mr Davis to show that it was not a case of him simply refusing to pay what he owed and that his present predicament arose from an inability to pay. If he did not do so the unavoidable inference was that the entire debate was taking place only because Mr Davis would not pay the debt.
11 Not only were these matters obvious but, in any event, the Court pointed them out during the course of argument. Mr King was put very precisely on notice that the Court was concerned that the evidential record before it contained no evidence that Mr Davis was unable to meet his child support obligations. This is confirmed by two exchanges which took place during the course of the hearing. The first was between the Chief Justice and Mr King:
KEANE CJ: Mr King, is there evidence - I mean, you may say it's irrelevant, and if you do, please say so. Is there evidence that your client doesn't have any other means of paying the $62,000?
MR KING: I think the answer to that is there's no evidence one way or the other.
….
KEANE CJ: …But just for my purposes, the position is that there is no evidence one way or the other as to whether you client has means other than this property, or other than the sale of this property - - -
MR KING: Or the estate.
KEANE CJ: Quite.
MR KING: Yes, that's right.
(emphasis added)
12 This was followed by an exchange between Perram J and Mr King immediately prior to the completion of the hearing:
PERRAM J: Before you go to that, can I just say the difficulty I have with that is that insofar as the sale were to proceed in a way that might actually bring about some loss sounding in damages, absent evidence that your client isn't able to discharge the debt, and thus obviate any interference with the property, it's hard to see that any such damage isn't self-inflicted.
MR KING: Well, there is no evidence that he couldn't, your Honour. There is no evidence that he - - -
PERRAM J: No, no, quite, quite. But what I'm concerned about is that that deficit, that absence of evidence is a deficit in your case. It's certainly a deficit in any argument that there is a substantial injustice or that there would be a substantial injustice that would be left uncured by a refusal of leave to appeal.
MR KING: Well, the onus is on my friend in section 31A cases, as Gordon J pointed out.
PERRAM J: No, no, so far as leave to appeal is concerned, we come back to the point that if you lose on the first point, you're in leave territory and if you're in leave territory you're the one who has to show a substantial injustice.
MR KING: Yes. Well, can I just deal with it.
PERRAM J: What I'm struggling - yes.
MR KING: Deal with it in two stages: we respectfully submit that we don't lose on the first point.
PERRAM J: I understand, we understand.
MR KING: Can I just briefly deal with it…..
[After this point Mr King proceeded to explain why leave to appeal was not required and did not return to the evidentiary point.]
13 A number of things flow from these exchanges. To begin with, Mr King expressly conceded that there was no evidence either way concerning this topic. Despite this deficiency in the evidence being expressly raised together with the implications it posed for the leave application, no suggestion was made to the Court that it should proceed other than on the basis of that which Mr King had told it, namely, that there was no evidence one way or the other. Mr King was expressly told the absence of this evidence was a problem for Mr Davis ("the absence of [such] evidence is a deficit in your case"). In those circumstances, there could be no procedural unfairness in the Court proceeding on the very basis explained to the Court by Mr King, namely, that there was no evidence before it which suggested Mr Davis could not meet his obligations.
14 The question then is whether Mr Davis' failure at the hearing to lead evidence about his inability to meet his child support obligations is such, in the language of Autodesk v Dyason (No 2), that it should not "be attributed solely to the neglect or default of the party seeking the rehearing". It is plain that Mr Davis was given an opportunity to deal with the issue at the hearing and, indeed, more than once. His counsel was invited to deal with the point but did not do so. No submission was made as to why the logic of the argument did not flow; no argument was put that it would be unfair to proceed along those lines; no time was requested in order to seek instructions on the issue; and no application was made to lead further evidence about the matter. Whatever the underlying causes of these decisions might be they are all ultimately attributable to Mr Davis. We reject the first and second bases articulated for reconsideration.
15 We turn then to the third. One of Mr Davis' many arguments was as follows: (a) his wife had a joint share with him of a property in Queensland; (b) the compulsory sale of his interest in that land harmed the value of her interest in the land; (c) the law authorising that to occur operated, therefore, as a law with respect to the acquisition of property and hence fell foul of the guarantee contained in s 51(xxxi) of the Constitution. The property compulsorily acquired (or potentially compulsorily acquired) from Mr Davis' wife was not her land as such (which she still plainly has) but the diminution caused to the value of her interest in that land by the compulsory sale of Mr Davis' interest in the same land. This is not, it may be accepted, an especially easy argument to follow nor one in which clarity appears as a primary virtue. We rejected it at paragraphs [20] to [21] of our first judgment. We concluded that it had no substance as a matter of principle and, further, that Mr Davis had no standing to complain about an acquisition of his wife's property ("We would add that, in any event, Mr Davis has no standing to pursue the point since the property allegedly acquired was his wife's and not his"). Mr Davis now claims this was an error because, in fact, he jointly owned the Queensland property with his wife. However, on this branch of the argument, the property put forward by Mr King as being susceptible to compulsory acquisition was part of the value of his wife's interest in her share of the Queensland land and that interest was plainly owned only by Mr Davis' wife and not Mr Davis. That was the argument. Accordingly, Mr Davis' evidence that the Queensland property is owned jointly by him and his wife passes well wide of the point in paragraph [21].
16 In any event, if it mattered, we reject Mr Davis' evidence which does not grapple with the legal consequences of the Registrar's actions. Mr Davis' interest was transferred to the Registrar on 24 July 2007 and has not been his at law since. He does have an entitlement to any residual proceeds from sale after the satisfaction of his debt to the Commonwealth but that does not give him any interest in the Queensland property. His interest is a contingent one in a fund which cannot come into existence until what was formerly Mr Davis' legal interest in the property is sold. Whilst he may ultimately have an interest in that fund (if the proceeds of sale are more than the amount of the Commonwealth's debt together with the sale expenses), that contingent interest gives him no proprietary interest in the land.
17 The fourth argument is that the Court failed to understand Mr Davis' case and did not deal with it. This is a serious suggestion to make and because of that we will set out paragraphs [6] and [7] of the submissions filed on his behalf:
6. As to [c] The Court at no stage articulates what case it is that the Applicant/Appellant was bringing to the Court. The case concerned more that Mr Davis' encounter with the child support "enforcement regime" [Reason 3]. It involved fundamental questions as to whether the Commonwealth could access a citizen's property. The vehicle of the claim brought in the Court was for an injunction founded on an equity in Queensland land [see Meagher Gummow and Lehane Equity Doctrines and Remedies 4th ed para 21 - 330 ff] to restrain the First Respondent from executing orders made ultra vires a New South Wales Court not because the Commonwealth parliament had conferred laws upon that Court [which was not disputed] but because the machinery of the NSW Court was not adapted to nor capable of execution of the orders made, and because the NSW Local Court had no jurisdiction to make the orders it made [cf Yirrell v Yirrell 1939 62 CLR 287], and for damages or compensation for wrongful interference in the property rights of the Applicant to be assessed [Riverina Transport v Victoria [1937] 57 CLR 327]. There was a further claim regarding the operation of the rule in Commr for Stamp Duties [Qld] v Livingston [1960] 107 CLR 411 with respect to an allegedly defective notice of claim not on the estate but on the solicitors for the deceased. In short Mr Davis confronted head on [instead of ignoring his responsibilities] the entitlement of the Commonwealth to adversely affect his property interests in the intrusive modes conducted.
7. Mr Davis was at least entitled to be heard on the legality of the threatened conduct of the First Respondent which so far as the Court is concerned appears never to have been addressed at all. With respect his appeal ought not to have been rejected because there was no substantial injustice to him, as the remedy "lay within his own hands". That observation can be made about many cases. Mr Davis brought a justiciable dispute or matter to the only Court [apart from the High Court] which could decide the point.
18 There are six points here:
(1) there was no articulation by the Court of Mr Davis' argument;
(2) the Court inaccurately summarised Mr Davis' case as merely an encounter between Mr Davis and the enforcement régime provided for by the Collection Act;
(3) The case involved fundamental questions as to whether the Commonwealth could access a citizen's property;
(4) The argument was that the machinery of the New South Wales Local Court "was not adapted to nor capable of execution of the orders made" and also that the Local Court had no jurisdiction to make the orders it made;
(5) There was a claim for damages or compensation for wrongful interference in the property rights;
(6) There was a further question regarding the operation of the rule in Livingston v Commissioner for Stamp Duties (Qld) (1960) 107 CLR 411.
19 These suggestions are without substance. As to (1), Mr Davis' arguments were fully set out at [17]. As to (2), whilst it is true that the Court said in an introductory part of its judgment that the case concerned "Mr Davis' encounter with this enforcement regime" (at [3]) it is scurrilous to suggest, as Mr King's submission do at [6], that this was all the Court considered Mr Davis' case to be. Paragraphs [17]-[37] dealt explicitly with each of Mr King's submissions.
20 As to (3), the constitutional argument (which we would describe as insubstantial rather than fundamental) was dealt with at [20], coupled with a finding that Mr Davis had no standing to pursue the argument at [21].
21 As to (4), contrary to the submissions of Mr King, each of these matters was explicitly dealt with in the Court's reasons. The argument that the mechanism of the Local Court was not adapted or capable of executing the putative orders was dealt with at [29]-[33]; the argument that it could not order execution outside of NSW at [32].
22 As to (5), no part of the application for leave to appeal involved any consideration of Mr Davis' claims in tort. None of the actions of which Mr Davis complains could be tortious if they were authorised by law. Mr Davis' arguments to Foster J and to us focused on establishing that the Registrar's actions were not authorised by law. It is only if that was established could the tort issues then arise. There was no debate about the tort claims before us separate from the questions of whether the actions of the Registrar were authorised by law. The Court did not analyse the mechanics of the tort claims not only because Mr King's submissions did not do so but also because no occasion arose for it to do so. The suggestion that the Court did not refer to the tort claims is also wrong: see [6].
23 As to (6), this argument was expressly dealt with at [25]. The Court concluded that the question of whether Mr Davis did or did not have a present entitlement in the estate was irrelevant because s 72A did not require a present interest.
24 The making of an application for a rehearing is a serious application because it runs counter to the public interest in the finality in litigation. It occasions expense to the other parties and to the public purse. It is not a trifle to be launched on a whim still less without reading the judgment the subject of the application. We say this because paragraphs [6]-[7] of the submissions bearing Mr King's name (but not his signature) either show no sign of their author having read paragraphs [17]-[37] of the judgment or, in the alternate, having understood them. In either case, paragraphs [6]-[7] of that submission fall well short of the standard which this Court is entitled to expect of those who appear before it, particularly those with substantial experience.
25 In those circumstances, the Court's initial conclusion that no substantial injustice to Mr Davis would result if leave were refused should not be revisited given the explicit opportunity afforded to him at the first hearing to deal with that issue. In any event, for the reasons given the Court's earlier conclusion that there was no reason to doubt the correctness of the learned primary judge's conclusions remains correct. Mr Davis still fails, therefore, to satisfy either of the cumulative requirements of Décor Corporation Pty Ltd v Dart Industries Inc and his application for leave to appeal remains one which must be dismissed. It follows from that conclusion together with the observations in the preceding paragraph that the present application for the Court to review its orders is one which should not have been made. It must, therefore, be dismissed with costs.