Hayes v Pioneer Credit Acquisition Services Pty Ltd

1. The appeal is allowed.
2. The orders of the Federal Circuit Court of Australia made on 7 September 2017 are set aside.
3. The matter is remitted to the Federal Circuit Court of Australia for a further hearing. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

RANGIAH J: 1 This an appeal from a judgment of the Federal Circuit Court of Australia ordering that a sequestration order be made against the estate of the appellant pursuant to s 52 of the Bankruptcy Act 1966 (Cth). 2 The sole ground of appeal is expressed as follows: 1. [The primary judge] by his actions removed/denied the God given rights of the man known as Brett John Hayes to: a) be heard. b) defend himself from attack, said attack causing serious harm and damage. c) to present evidence. d) question/cross examine the plaintiffs. e) Contract, or Not to Contract which is Unlimited. f) Due Process of Law. g) Be Presumed Innocent, suffering No Detention or Arrest, No Search or Seizure, without Reasonable Cause h) Equality in the eyes of the Law, 3 The substance of the ground is that the appellant was denied procedural fairness, or natural justice, before the Federal Circuit Court. 4 The matter has a lengthy history. The creditor's petition was filed on 25 August 2015. It alleges that the appellant committed an act of bankruptcy by failing to comply with the requirements of a bankruptcy notice. The bankruptcy notice claimed that the appellant owed the respondent the amount of $63,329.63, consisting of a judgment debt and interest (the debt). 5 The hearing of the creditor's petition was adjourned to allow the appellant to apply to the Magistrates Court of Queensland to set aside the default judgment obtained by the respondent. The appellant's application to set aside the judgment was dismissed, as was his appeal to the District Court of Queensland and a second application to the Magistrates Court. 6 At that stage, the appellant wrote to the respondent saying that he intended to pay $100 per month towards the debt and enclosing a money order for the first payment. ·Before the Federal Circuit Court, the appellant argued that by banking the money order, the respondent had accepted his offer to pay off the debt in instalments. The primary judge found that a contract had been made for payment by instalments and, on that basis, dismissed the creditor's petition. The respondent appealed to this Court. On 21 February 2017, I set the judgment aside and remitted the matter to the Federal Circuit Court for a new trial: Pioneer Credit Acquisition Services Pty Ltd v Hayes [2017] FCA 124. 7 The matter was then listed for hearing on 7 September 2017 before a different Federal Circuit Court judge. The appellant was self-represented. It is necessary to set out a substantial portion of the transcript in order to explain the way matters unfolded before the primary judge: ... HIS HONOUR: Thank you. Sir, you are? MR B.J. HAYES: Yes, good morning. I am the man known as Brett John Hayes, a man as is referenced in the Bible, Genesis 2:7, here by invitation, and, as God is my witness, do swear on the Bible that I hold in my hands, that I, of being sound spirit, body and mind, am here to make right any valid - - - HIS HONOUR: Sir - - - MR HAYES: - - - and lawful claim - - - HIS HONOUR: Please stop. MR HAYES: - - - that any man or woman - - - HIS HONOUR: Please stop. MR HAYES: - - - makes - - - HIS HONOUR: Are you the respondent? MR HAYES: No, I'm the man, mate. I'm the man, basically, requiring the men named as plaintiffs to validate their - verify their claim. HIS HONOUR: Are you the respondent? MR HAYES: No. HIS HONOUR: I see. Can you leave - - - MR HAYES: No, I'm not - - - HIS HONOUR: All right. MR HAYES: - - - a legal entity at all. HIS HONOUR: I see. MR HAYES: I'm a man. HIS HONOUR: All right. MR HAYES: Yes. HIS HONOUR: Well, if you're not the respondent, can you leave the bar table. Because - - - MR HAYES: I will take the stand. HIS HONOUR: No, I don't want you to take the stand. If you're not the respondent, you have no entitlement to be at the bar table, so you will have to leave. MR HAYES: I do not understand that. I'm the man. Is there - is this matter not between a - a - five men, who have made a claim against the man, Brett John Hayes? And I am the man, Brett John Hayes. HIS HONOUR: So are you the respondent to these proceedings? MR HAYES: I'm the man requiring validation of the claim. I'm here to make right any valid claim. HIS HONOUR: Sir, are you the respondent? That's all I need to know. MR HAYES: Is "the respondent" a word in the Bible? HIS HONOUR: I don't know whether it's - "respondent" is the word in the Bible. I know that "respondent" is a word in the rules of this court. And are you the respondent? MR HAYES: Is not the rules of the court the Bible? HIS HONOUR: I see. Sir, if you're not the respondent, then I'm going to ask you again to leave the bar table. If you don't leave the bar table, then I'm going to get security to remove you. Are you the - - - MR HAYES: Is - - - HIS HONOUR: Are you the respondent? MR HAYES: Is the word - - - HIS HONOUR: Sir, please. MR HAYES: Can I please ask a question. HIS HONOUR: No. No. MR HAYES: I don't - - - HIS HONOUR: No, you can't. Stop. Are you the respondent? MR HAYES: I don't know. HIS HONOUR: It's a yes/no question. MR HAYES: I don't know. HIS HONOUR: I see. All right. Leave the bar table. If I can't be satisfied you're the respondent, you have to leave the bar table. MR HAYES: I have to know, what does respondent mean? Is there a legal - is there a legal - a - if you use the word "respondent" - - - HIS HONOUR: Please leave the bar table. MR HAYES: - - - is there a legal terminology that I have lost my standing as a man? HIS HONOUR: Please leave the bar table. Take all your stuff. If you're not the respondent, you've got no business having anything there, so take it all. MR HAYES: I - again, am I - is - so is this matter between Pioneer Credit, or the men known as Pioneer Credit, and the respondent? HIS HONOUR: I don't understand your question, and I don't intend to answer it. If you're not the respondent to these proceedings, if you are not Brett John Hayes, or whatever the name - - - MR HAYES: I am Brett John Hayes. HIS HONOUR: You are? MR HAYES: I am Brett John Hayes; that's correct. HIS HONOUR: So, the respondent to these proceedings. MR HAYES: Am I, in responding to any claim - I will respond; I'm here responding. Am I - am I going to be titled as a - as a - as a - as a dead entity or a legal fiction or something? No, I'm not. I'm not going to do that. I'm just a simple man, here to make right - - - HIS HONOUR: Sir. MR HAYES: Simple. HIS HONOUR: This is your last opportunity to tell me whether you're the respondent, Brett John Hayes, in these proceedings, or not. MR HAYES: I'm Brett John Hayes; that's correct. ... HIS HONOUR: ... Right. So, Mr Hayes, you're the respondent. Thank you, Mr Messina. MR HAYES: I am not Mr Hayes, either. HIS HONOUR: Who are you? MR HAYES: I'm Brett John Hayes. My father - - - HIS HONOUR: I see. MR HAYES: - - - my mother, as the creator of I, created I. I believe - - - HIS HONOUR: I see. MR HAYES: This is what I believe. HIS HONOUR: I'm not interested in what you believe, sir. Mr Messina. MR MESSINA: Your Honour, may I read the following material. ... HIS HONOUR: Now, sir, you've just told me you are the respondent. MR HAYES: I'm not the respondent. I'm the man, Brett John Hayes. HIS HONOUR: I see. Well, if we're going to go through this again, you will have to leave, because I only deal with the respondent. Unless you're a lawyer - you could be a lawyer - - - MR HAYES: No, I'm not a lawyer. HIS HONOUR: I see. All right. Well, if you're either the respondent, or you're a lawyer who represents the respondent; if you're neither of those people, you have no business being at the bar table, and you have to leave - - - MR HAYES: So there's no claim against the man, Brett John Hayes - - - HIS HONOUR: - - - and you have - no. You have to leave if you're not the respondent. MR HAYES: I am the man, Brett John Hayes. HIS HONOUR: I see. Are you the respondent? MR HAYES: Look, it's - again - - - HIS HONOUR: Are you the respondent? MR HAYES: I am here to make right any valid - - - HIS HONOUR: Are you the respondent, sir? MR HAYES: - - - and lawful claim. HIS HONOUR: That's all I want to know. MR HAYES: Look, I don't understand your terminology. HIS HONOUR: I see. MR HAYES: As far as I'm concerned, "respondent" is not in the Bible. HIS HONOUR: I see. I'm not interested in what's in the Bible; I'm interested in what's on the creditor's petition that was served on you. Are you the respondent - - - MR HAYES: So is that the - - - HIS HONOUR: - - - to the creditor's petition? MR HAYES: Was the creditor's petition - was the creditor's - what you call the creditor's petition - was that served on the respondent, or was that served on the man, Brett John Hayes? HIS HONOUR: Are you the respondent named in the creditor's petition? MR HAYES: I am the man, Brett John Hayes. HIS HONOUR: Are you the respondent? MR HAYES: I am the man, Brett John Hayes. HIS HONOUR: Call security. Have him removed. Adjourn the court. Let me know when he's not in the courtroom any more. [Underlining added.] 8 The appellant was then removed from the courtroom by security staff. When the hearing resumed, the primary judge said: HIS HONOUR: I don't know who that was, but he wouldn't tell me that he was the respondent, so I'm not sure what it was that he thought - or how it was that he thought he could appear. In the circumstances, there seems to be no appearance in opposition to the creditor's petition. 9 The hearing then proceeded in the appellant's absence. At the conclusion of the hearing, the primary judge made a sequestration order and an order for costs. His Honour gave brief ex tempore reasons, indicating that he was satisfied that the debt was still owed to the respondent and of the formal requirements under s 52 of the Bankruptcy Act. The reasons did not refer to his Honour's decision to have the appellant removed from the courtroom. 10 The appellant submits that he was denied procedural fairness when he was excluded from the courtroom and the hearing proceeded in his absence. He also makes a number of other submissions as to the conduct of the proceeding that are either irrelevant or nonsensical or both. 11 The respondent submits that the primary judge ordered the appellant's removal from the courtroom because his Honour was unable to be satisfied that the man at the bar table was the respondent. His Honour asked the man on 13 occasions whether he was the respondent to the proceeding and he made conflicting statements about his identity. The respondent submits that his Honour appropriately exercised the discretion under r 10.01(3)(s) of the Federal Circuit Court Rules 2001 (Cth) to make directions as to any matter and under r 13.03C(1)(e) to proceed with the hearing in the appellant's absence. 12 The reasons provided by the primary judge for removing the appellant from the courtroom are those set out at [8] above, together with what can be discerned from the exchanges with the appellant. His Honour's reasoning appears to have been that, firstly, he was not satisfied that the appellant was the respondent to the proceeding. Secondly, as the appellant was not a lawyer, he could not appear as a representative of the respondent. Thirdly, the respondent had been served and as he had not appeared, it was appropriate to proceed with the hearing. 13 As to the first two aspects of his Honour's reasoning, r 4.01(1) of the Federal Court Rules 2011 (Cth) provides that "a person may be represented in the Court by a lawyer or may be unrepresented". There is no equivalent provision in the Federal Circuit Court Rules. However, s 43(2)(b) of the Federal Circuit Court of Australia Act 1999 (Cth) and r 1.05(b) of the Federal Circuit Court Rules provide that if the Federal Circuit Court Rules are insufficient, the Federal Court Rules apply with necessary modifications to the practice and procedure of the Federal Circuit Court. Accordingly, r 4.01 of the Federal Court Rules applies to proceedings in the Federal Circuit Court. As to the third aspect, His Honour must have relied on r 13.03C(1)(e) of the Federal Circuit Court Rules, which provides that if a party is absent from a hearing, the Court may proceed with the hearing. 14 The primary judge found that he was not satisfied the appellant was the respondent to the proceeding. The appeal turns upon whether there was any error in making that finding and whether any such error led to a denial of procedural fairness. 15 The discourse between the primary judge and the appellant was lengthy, confusing and circular. On one hand, the appellant repeatedly stated that he was Brett John Hayes, but refused to acknowledge the title of "respondent". This was apparently on the basis that the appellant only acknowledges titles given in the Bible. On the other hand, his Honour repeatedly ignored the fact that the appellant acknowledged that he was Brett John Hayes and that he was there to respond to the claim against him, insisting that he explicitly acknowledge himself as "the respondent". Whether intentionally or not, the point that each was trying to make passed the other by. It was not unlike the dialogue from Monty Python's "Dead Parrot" sketch. 16 The second of the underlined group of passages from the transcript makes it reasonably clear that the appellant acknowledged that he was Brett John Hayes, and that he was there to respond to the claim made against him, but that he did not accept being "titled" the respondent. At that point his Honour seemed to be satisfied that the man was the respondent, since his Honour then moved onto a different issue. 17 Unfortunately the protagonists later returned to their, by now familiar, argument. Eventually, the appellant said "I am not the respondent. I am the man, Brett John Hayes". Another circular discussion ensued and eventually his Honour called for security to remove the appellant from the courtroom. 18 As the appellant repeatedly acknowledged that he was Brett John Hayes, his Honour's statement that "I don't know who that was", was not correct. The only question for his Honour was whether the appellant was the Brett John Hayes named as the respondent in the creditor's petition. The appellant acknowledged that he was there to respond to the claim made against him. There was no suggestion that the appellant was some different Brett John Hayes who was there to meddle in a proceeding that did not concern him. The only reasonable inference available was that the appellant was the Brett John Hayes named in the creditor's petition. His Honour's conclusion that he was not satisfied that the appellant was the respondent to the proceeding was unreasonable. The consequence of the primary judge's erroneous finding was that the appellant was excluded from the courtroom and from the remainder of the hearing. 19 It is uncontroversial that a party to a proceeding has the right to a fair hearing, including being given a reasonable opportunity to present his or her case. In Stead v State Government Insurance Commission (1986) 161 CLR 141 at 145, the High Court cited the following passage from Jones v National Coal Board [1957] 2 QB 55 at 67: There is one thing to which everyone in this country is entitled, and that is a fair trial at which he can put his case properly before the judge…No cause is lost until the judge has found it so; and he cannot find it without a fair trial, nor can we affirm it. [see also Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at [40]; Sullivan v Department of Transport (1978) 20 ALR 323 at 343; Cameron v Cole (1944) 68 CLR 571 at 589]. 20 The primary judge was presumably faced with a busy bankruptcy list. The appellant was wasting the Court's time with nonsensical recitations and his refusal to directly acknowledge that he was the respondent to the proceeding. His Honour's frustration was palpable, and understandable. I am conscious of the reputation of appellate judges as "the ones who lurk in the hills while the battle rages; then, when the battle is over, they descend from the hills and shoot all the wounded": see Ruth Bader Ginsburg, Remarks on Writing Separately (1990) 65 Washington L Rev 133 at 143. However, the "battle" is not supposed to be between the trial judge and a self-represented litigant. His Honour was not entitled to insist that the appellant describe himself by the title "respondent" as a condition of being permitted to appear. The exchanges did not justify the exclusion of the appellant from the courtroom. The appellant was denied the opportunity to call evidence and to make submissions. That was a denial of procedural fairness. 21 The respondent submits that a new hearing of the creditor's petition should not be ordered because it would be futile to do so; that even if the appellant had been given the opportunity to present his case, the outcome would inevitably have been the same. The appellant relies on the affidavits that he wished to read before the Federal Circuit Court and argues that there were grounds for going behind the judgment which founds the bankruptcy notice. I do not propose to effectively decide, as the respondent urged me to do, whether a sequestration order should have been made. That is at least because to carry out the function that the Federal Circuit Court did not would be to deny the appellant a layer of appellate scrutiny: see AAM15 v Minister (2015) 231 FCR 452 at [14]. 22 In Stead v State Government Insurance Commission, the High Court held at 145-147 that where there is a denial of procedural fairness, there should be a new trial unless it appears that a properly conducted hearing could not possibly have produced a different result. It is difficult to conclude that compliance with the requirements of procedural fairness could have made no difference to the outcome in circumstances where the appellant was prevented from calling any evidence and from making any submissions about factual and legal issues. I am not satisfied that a properly conducted hearing could not possibly have produced a different result. 23 The appeal should be allowed. The judgment of the Federal Circuit Court should be set aside. The matter should be remitted to the Federal Circuit Court to hear and determine. 24 I recognise that this unfortunate saga is not the fault of the respondent, which has been put to considerable and unnecessary expense. I will entertain any application for a costs certificate under s 6(1) of the Federal Proceedings (Costs) Act 1981 (Cth). I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Rangiah.