Dudzinski v Kellow

REASONS FOR JUDGMENT 1 A bankruptcy notice QN 306 of 2001 was served by the ten respondents on Mr Dudzinski on 20 January 2002. That bankruptcy notice specified in the schedule that the amount of the judgment or order was $17,700 for legal costs. Attached to the bankruptcy notice was an order of the Full Court of the Federal Court of Australia constituted by French, Whitlam and Lindgren JJ who, on 27 August 1999, ordered: "1. The application for leave to appeal is dismissed. 2. The Applicant is to pay the Respondents' costs of the application for leave." 2 Also attached to the bankruptcy notice was a certificate of taxation in the same number, Q110 of 1999, signed by Heather Baldwin, a taxing officer, and bearing the date 29 February 2000. That certificate of taxation reads: "I certify that I have taxed and allowed the bill of costs of the Respondents at seventeen thousand, seven hundred dollars ($17,700)." 3 Mr Dudzinski has applied to set aside the bankruptcy notice and to extend the time for compliance with the bankruptcy notice. That application was the subject of a number of amendments, and the form presently before the Court is in the document filed 9 April 2002. Under the heading "Details of Claim", it sets out in two paragraphs why Mr Dudzinski believes the Court will extend time for compliance with that bankruptcy notice, and in essence claims that the time for compliance should be extended because Mr Dudzinski has instituted the High Court action B97 of 2001 to set aside in part the judgment in QG168/97 of 8 April 1999 and Q110/99 of 27 August 1999. That application also seeks an order that the Court will set aside the bankruptcy notice on grounds that are there set out. Those grounds number thirteen in all, as follows: "2. The Court will set aside the Bankruptcy Notice Q/N/306/2001 on the grounds that: 2.1 The creditor does not have yet a judgement that is 'final'. The creditor obtained 'Ex-tempore' judgement only on 27.8.1999 in Q110/1999 matter. That judgement is a subject to review by the High Court of Australia either by: (i) A 'special leave to appeal' process, or (ii) The process of seeking of 'prerogative' orders of the High Court of Australia (HCA) what the Applicant did choose to pursue. Such process was already once on foot in May 1999 against The Hon. Justice Drummond of Federal Court of Australia and Federal Court of Australia and Racial Discrimination Commissioner Antonios (close to the hearing before HCA the Applicant discontinued these actions on 13.5.1999 as one of the reasons - the Federal Racial Discrimination Commissioner promised to continue inquiry what she did not in effect). 2.2 the Applicant have a cross-action (cross-demand) in the Supreme Court of Queensland (SCQ) No 1955/2000 against Third, Fourth, Tenth, Respondents which is exceeding the sum specified in Bankruptcy Notice. This claim supra was filed in or about 3.3.2000 in the Supreme Court of Queensland (SCQ). (i) The claim was not served yet and was recently renewed till about 3.10.2002. This claim No 1955/2000 is ready to be served at any time however it is intended that it will be amended before serving. These actions in SCQ are continuation of 'negligence' and 'assault' actions of total claim of ca $104,000 in QG168/1997 and Q110/1997 in FCA which were not struck out (claim in SCQ was increased). 2.3 The Applicant/Debtor has a cross-claim (cross-demand) under the Sex Discrimination Act 1984 (Cth) Racial Discrimination Act 1975 (Cth) for $300,000. The application for judicial review of the Human Rights and Equal Opportunity Commission's (HREOC'S) 2 decisions (not binding and interlocutory) No H99/9 dated 3.5.2000 and 3.6.2000 respectively concerning action under and the Sex Discrimination Act 1984 (Cth) for the alleged sex discrimination of the Applicant by the 3rd, 4th and 10th Respondents and the application for judicial review of the Human Rights and Equal Opportunity Commission's (HREOC'S) decision (not binding and interlocutory) No: 207271FC, dated 20.1.2000 for the alleged racial discrimination of the Applicant in breach of the Racial Discrimination Act 1975 (Cth) by the 3rd, 4th, 6th and 10th Respondents will be accepted for filing without or with amendments as concerning substantive rights of the Applicant. The claims under both federal acts supra were originally in Part IX in QG168/97 claim of the Applicant/Debtor however struck out due to lack of jurisdiction as the only reason. The applications for judicial review of HREOC'S decisions supra were lodged on 3 July 2000 and at least when concerning the decision H99/9 of 3.6.2000 supra on time ie within 28 days. On 6.7.2000 DDR Baldwin refused to file the application concerning those 3 decisions supra. In addition the application for judicial review of HREOC'S decisions No: 207271FC, dated 20.1.2000 for the alleged racial discrimination of the Applicant by 3rd, 4th, 6th and 10th Respondents supra was lodged with the Federal Court of Australia in Brisbane in time ie on or about 21.2.2000 and refused for filing by Justice Kiefel. When the Applicant requested the Hon. Justice Drummond in or about February 1999 a stay order in Q168/1997 matter (then not struck out) pending HREOC'S determination under RDA and SDA actions in order to join them later with Q168/1997 suit (refused) His Honour said inter alia He does not see any reasons why the Applicant can not bring separate actions under the Sex Discrimination Act 1984 (Cth) and Racial Discrimination Act 1975 (Cth) in FCA. When the Applicant wanted to do so in January and June 2000 year his application were refused for filing as supra described. 2.4 The Applicant/Debtor have a further cross-demand against 10th Respondent and Ors, the particulars of which are in the accompanying affidavit of Waldemar Dudzinski sworn on 9.4.2002. 2.5 By reason that the stay order in QG168/1997 of 9.4.1999 and upholding ex-tempore judgement of his decision by Full-Federal Court in Q110/1999 matter on or about 27.8.1999 and extending of the process in HCA by a requirement of going through the process of application to issue the process and engagement on other legal fronts simultaneously, absence of relief from Federal Court in 1999, 2000 and 2001 years when requested such against Centrelink's actions, legal actions with QUT in 1999-2002 years caused by Centrelink, conduct of the 10th Respondent and associated persons with it in 2001 year, all those circumstances caused that the Applicant could not deal properly with cross-action, set-off and etc earlier. Other reasons were that Applicant's applications for judicial review were refused for filing by Justice Kiefel on or about 20.2.2000 and by DDR Baldwin on 6.7.2000 despite they were presented for filing on time ie within 28 days from the decisions ie in the case of the decisions No 207271FC of 20.1.2000 and H99/9 3.6.2000 mentioned supra in para 2.3 were made. 2.6 The Bankruptcy Notice was not stamped by the Registrar when served as required by Bankruptcy Rules, r 15. 2.7 The creditor did not comply with the Order 62, rules 40(1) and especially rule 40(2) ie the creditor did not attach to the bill of costs of 'adding machine or computer slips or working papers together with originals or legible copies of receipts for disburse-ment, or if a disbursement has not been paid, copies of all relevant accounts' and refused on request to supply those documents even recently. 2.8 The Applicant objected inter alia that bill of costs is unreasonably high concerning especially disbursement and counsels' fees and that it contains unnecessary items and those objections were neglected or refused to be taken into account. 2.9 The DDR Registrar Baldwin refused to hear the Applicant's objections on 23.2.2000 re: Respondents' bill of costs by reasons the Applicant could not afford to pay $750.00 fees as required by FCA, contrary also to Order 1 rule 8 of FCA, issue of abuse of power, denial of natural justice. 2.10 The DDR Registrar Baldwin did not use at all or used it in an unsatisfactory way a discretion as required by Order 62, rule 22 of FCA Rules. 2.11 The Registrar did not provide reasons as to any objections of the Applicant he had regarding bill of costs contrary to Order 62, rule 43(1)(b). 2.12 The DDR Registrar Baldwin who sat as Federal Court on 23.2.2000 did not exempt creditor from compliance with Order 62, rule 40(1)of FCR ie with the requirements to attach to the bill of costs of 'adding machine or computer slips or working papers together with originals or legible copies of receipts for disbursement, or if a disbursement has not been paid, copies of all relevant accounts as required by' Order 62, rule 40(1) of FCR and obviously the creditor did not comply and refuse to comply. 2.13 Fraud (including in this notion abuse of power, bad faith, bias, denial of natural justice)." 4 The position in relation to the bankruptcy notice and the application that Mr Dudzinski has brought in relation to it, is that on 8 April 1999 Drummond J struck out a number of the applicant's claims pursuant to O 20 r 2 of the Federal Court Rules, declined to grant the applicant liberty to re-plead, and ordered that the remaining actions in that proceeding be permanently stayed. 5 Mr Dudzinski sought leave to appeal from the judgment of Drummond J, which application was refused by a Full Court constituted by French, Whitlam and Lindgren JJ on 27 August 1999, and in respect of which Mr Dudzinski was ordered to pay costs. On 7 January 2000, Deputy District Registrar Baldwin issued an estimate of costs pursuant to O 62 r 46. On 23 February 2000, Deputy Registrar Baldwin dismissed Mr Dudzinski's notice of motion to file an objection, as he failed to provide a security for costs of $750. 6 On 29 February 2000, the certificate of taxation to which I have referred was issued. On 24 May this year, I, in essence, upheld the decision of the Registrar in the application made by Mr Dudzinksi to have the decision declining to deal with the objections in the absence of a payment of the security deposit of $750 set aside. The bankruptcy notice to which I have referred, which is dated 19 December 2001, is based on the debt payable by the debtor arising out of the order for costs made by the Full Court of the Federal Court in favour of the ten respondents on 27 August 1999, and in relation to which the certificate of taxation for $17,700 was issued on 29 February 2000. 7 One of the bases of complaint by Mr Dudzinski is that, because of the steps he has taken in the High Court in proceedings B97 of 2001, the order for costs made by the Full Court is not a final judgment or final order. I disagree. The order for costs by the Full Court of the Federal Court is final. An order does not cease to be final merely because there is the opportunity of an appeal or other steps or proceedings which may be taken to seek to impugn that judgment. A judgment of a superior court is a final judgment on which execution may issue, even if that judgment is liable to subsequently be set aside. This ground of complaint is not sound. 8 The order of the Full Court of the Federal Court has not been stayed. Mr Dudzinski made an application for special leave to appeal the decision of the Full Court of the Federal Court. However, that application has been deemed to be abandoned. Mr Dudzinski said in the course of oral submissions today that application was abandoned by him. Instead, Mr Dudzinski is seeking leave to issue a writ of certiorari, prohibition and mandamus against Drummond J and the Full Court of the Federal Court. 9 A letter of 19 February 2002 from the Deputy Registrar of the High Court to the solicitors acting for the respondents in the present matter says, in part: "I confirm that on 30 November 2001 Mr Dudzinski filed an ex parte application for leave to issue a proceeding ... This application was filed as a result of directions made on 7 April 2000 and 24 March 2000 by a Justice, pursuant to Order 58 sub-rule 4(3) of the High Court Rules. This subrule provides as follows: If the writ, process, commission, petition, appeal or application appears to a Registrar on its face to be an abuse of the process of the Court or a frivolous or vexatious proceeding or application, the Registrar must seek the direction of a Justice who may direct the Registrar to issue or file it or to refuse to issue or file it without the leave of a Justice first had and obtained by the party seeking to issue or file it. The applications sought to be issued were applications for writs of mandamus, prohibition and certiorari directed against Drummond J of the Federal Court as the first respondent and French, Whitlam and Lindgren JJ of the Full Court of the Federal Court as the second respondents. The ex parte application for leave to issue a proceeding, has not yet been referred to a Justice for consideration in chambers (it is the practice of this Court that these applications are considered on the papers without an oral hearing). This is at the request of the applicant who still wishes to file further material." 10 I will deal separately with the two broad bases on which orders are sought by Mr Dudzinski. The first is based on s 41(7) of the Bankruptcy Act 1966 (Cth) (the Act) which provides: "[Counter-claim, set-off or cross demand] Where, before the expiration of the time fixed for compliance with the requirements of a bankruptcy notice, the debtor has applied to the Court for an order setting aside the bankruptcy notice on the ground that the debtor has such a counter-claim, set-off or cross demand as is referred to in paragraph 40(1)(g), and the Court has not, before the expiration of that time, determined whether it is satisfied that the debtor has such a counter-claim, set-off or cross demand, that time shall be deemed to have been extended, immediately before its expiration, until and including the day on which the Court determines whether it is so satisfied." 11 I have dealt with the claim that the judgment the subject of the bankruptcy notice is not a final judgment or final order. The material before the Court on which Mr Dudzinski asserts that he has "...a counter-claim, set-off or cross demand" equal to or exceeding the amount of judgment debt or sum payable under the final order is not within s 41(7), regardless of whether those claims properly constitute a counter-claim, set-off or cross demand. This is because all of the claims on which Mr Dudzinski seeks to rely lack mutuality between the alleged cross demand and the debt on which the ten respondents to this application rely. A debtor may only raise, as an answer to a bankruptcy notice issued by ten joint creditors, as here, a cross demand against those ten creditors jointly. Mr Dudzinski disputes the validity of that statement. However, it is the law which I have to apply. 12 Most recently, a Full Court of the Federal Court in Stec v Orfanos [1999] FCA 457 on 15 April 1999 said at [24]: "The primary judge [von Doussa J] then said that there was a more general answer to all the alleged cross demands. This was that in answer to a bankruptcy notice issued by several joint creditors, the debtor may not raise a debt owed by one or some of them individually." Later, their Honours said: "Where a debtor seeks to set aside a bankruptcy notice on the ground that the debtor has a cross demand which equals or exceeds the amount of the judgment or order on which the bankruptcy notice is founded, the judgment on the one hand and the cross demand on the other must be mutual and due in the same right: Re Anderson; Ex parte Alexander (1927) 27 SR(NSW) 296; James v Abrahams (1981) 51 FLR 16 at 27." And later: "Thus joint debts cannot be set off against several debts." The reverse is also true. Several debts cannot be set off against joint debts. The Full Court said at [25]: "We agree with the primary judge's observations in Emanuele and in the present case that a debtor may only raise as an answer to a bankruptcy notice issued by several joint creditors a cross demand against those creditors jointly." 13 This conclusion is fatal to the claim based on s 41(7) of the Act. There are, however, other bases on which that subsection has no application in the present circumstances. Complaints by Mr Dudzinski concerning the bill of costs and the manner in which it was assessed and the declining by the Deputy District Registrar to consider objections raised by Mr Dudzinski in his failure to provide security of $750 pursuant to O 62 r 46(3)(d), seek to go behind the judgment. No basis has been shown, in my opinion, why the Court should go behind the judgment constituted by the estimate of the taxing officer of the costs that have been ordered to be paid by the Full Court. Further, in relation to the lack of mutuality point, a claim made by the applicant in the Supreme Court, while it is for a sum greater than $17,700, is against only three of the ten present respondents. 14 Additionally, the evidence must go further than simply the making of a claim. What has to be shown is that there is a prima facie case with a fair prospect of success, and in this case Mr Dudzinski has done nothing more than to attach that claim to one of his affidavits. The material is insufficient to establish the content of the claim, but even if this were not so, as I have indicated, the various claims fail for their want of mutuality with the judgment creditors. 15 The second basis of Mr Dudzinski's application is his request that the time for compliance with the bankruptcy notice be extended. That relies on s 41(6A) of the Act which provides: " [Extension of time by Court] Where, before the expiration of the time fixed for compliance with the requirements of a bankruptcy notice: (a) proceedings to set aside the judgment or order in respect of which the bankruptcy notice was issued have been instituted by the debtor; or (b) an application has been made to the Court to set aside the bankruptcy notice; the Court may, subject to subsection (6C), extend the time for compliance with the bankruptcy notice." 16 In my opinion, the condition for the extension of time for compliance with the bankruptcy notice referred to in s 41(6A)(a) has not been made out, in that proceedings to set aside the judgment or order in respect of which the bankruptcy notice was issued have not been instituted by the debtor. Whilst Mr Dudzinski has initiated an application for leave to issue prerogative writs against a judge of this Court and the three judges of the Court that constituted the Full Court on appeal from Drummond J, that, in my opinion, is not properly to be classified as "proceedings to set aside the judgment" in which the bankruptcy notice was issued. 17 The direction made pursuant to O 58 r 4(3) of the High Court Rules concerning Mr Dudzinski's claim for prerogative relief reflects the observations of McHugh J in Re Davison (1997) 147 ALR 259 where his Honour said at 260: "Only in very clear cases do registrars approach justices for, or justices make, directions under O 58, r 4(3). And justices refuse to give leave to proceed only in very clear cases. … Once a direction has been made under O 58, r 4(3), it might seem unlikely that an applicant would later be able to persuade a justice that leave to issue the process should be given. A direction is given only where the case appears to be a very clear one. ..." 18 That circumstance is a basis on which the discretion conferred by s 41(6A) of the Act should not be exercised, even if I be wrong in my conclusion that the conditions for the exercise have not been made out. The application to set aside the bankruptcy notice, which is the ground relied on in s 41(6A)(b) of the Act, appears to me to be based on the claim that has been set up, or has been sought to be set up relying on s 41(7) of the Act, with which I have already dealt. 19 So far as a discretionary basis for extending time is concerned, if I be wrong in my view that there have not in fact been proceedings to set aside the judgment instituted by the debtor, there are reasons why that extension should not be granted. It is difficult to avoid the conclusion that the proceedings in the High Court have not been prosecuted with due diligence. The application for leave to seek prerogative relief in respect of judgments of Drummond J and the Full Court is now in respect of orders that are more than two years old. The letter from the Deputy Registrar of the High Court, earlier set out, indicates that Mr Dudzinski has filed an application for leave and has not filed all the relevant affidavit material on which he wishes to rely. The matter has not been heard upon request by Mr Dudzinski, based on his wish to file further material. 20 Apart from that aspect of the matter, which is a matter to which s 41(6C)(b)(ii) of the Act refers, there are other discretionary factors which tell strongly against exercising the discretion to extend the time for compliance based on s 41(6A) of the Act. The first of those is that the application for special leave from the judgment of the Full Court to the High Court has been deemed to be abandoned or has been abandoned. The application for leave to issue prerogative relief has still not been made, notwithstanding that High Court relief was commenced on 24 September 1999. The prospects of success on the application for leave to issue prerogative writs must be regarded as quite remote, given that it seeks prerogative writs against the Federal Court in the exercise of its general jurisdiction and the application for special leave has been deemed to be abandoned. The judgment of the Full Court of the Federal Court has not been stayed. 21 In my opinion, there is absolutely no basis on which, if there were power in this case to extend time under 41(6A) of the Act, it should be.