In the matter of Mikcon Group Australia Pty Ltd (in liquidation)

Legislation Cited: Civil Procedure Act 2005 (NSW) ss 56-60
Conveyancing Act 1919 (NSW) s 66G

Cases Cited: - Big Money World Pty Ltd v Red Hair Entertainment Pty Ltd [2018] NSWSC 1837
- Cameron v Cole (1944) 68 CLR 571 at 589; [1944] HCA 5
- Double Bay Newspapers Pty Ltd v Fitness Lounge Pty Ltd (2006) 57 ACSR 131; [2006] NSWSC 226
- Idoport v National Australia Bank Ltd [2006] NSWCA 202
- K Sheridan v Colin Biggers and Paisley [2019] NSWSC 621
- Liu v The Age Company Ltd (2016) 92 NSWLR 679; [2016] NSWCA 115
- Pi v Zhou [2016] NSWCA 148
- Webster v Super Smart Strategies Pty Ltd [2017] NSWSC 531

Category: Procedural rulings

Parties: Christian Peter Sprowles in his capacity as liquidator of Mikcon Group Australia Pty Ltd (in liq) (First Plaintiff/Respondent)
Michael Andrew Hogan in his capacity as liquidator of Mikcon Group Australia Pty Ltd (in liq) (Second Plaintiff/Respondent)
Michael Joseph Conneely (First Defendant/Applicant)
Porter Finance Australia Pty Ltd (Seventh Defendant)

Representation: Counsel:
J Foley (Plaintiffs/Respondents)
No appearance by First Defendant/Applicant
J Gill (Solicitor – Seventh Defendant)
Solicitors:
Bridges Lawyers (Plaintiffs/Respondents)
Clarke Kann (Seventh Defendant)

File Number(s): 2023/230363

JUDGMENT – ex tempore (Revised 6 May 2025)

Nature of the application

1. By Notice of Motion filed on 17 April 2025, Mr Conneely sought an order that:

“Judgement [sic] to be set aside due to forgery on the following documents Deed of Company Arrangement including Deed of Guarantee and Indemnity, and review the [Justice Nixon] decision as he breached his fiduciary duty and fiduciary responsibility on 14 April 2025 in the constructive trust matter 2023/00230363.”

2. I understand that application to refer to a careful ex tempore judgment delivered by Nixon J on 14 April 2025, which I address below. There was no appearance by Mr Conneely in respect of the motion today, in circumstances that I address below.

3. The Notice of Motion was in turn supported, at least to some extent, by Mr Conneely’s affidavit dated 17 April 2025. That affidavit commenced with the observation that:

"I, Michael Joseph am the authorized representative for the legal name for Michael Joseph Conneely defendant in this matter.”

I pause to note that the approach adopted in that paragraph, which seeks to distinguish the representative and the real person, is characteristic of the "sovereign citizen" ideology so far as it involves a suggested distinction between a “real” person and a legal person who deals with the state. The affidavit then goes on to advance reference to several legal maxims, with biblical references in support of them, and then asserts that Nixon J failed to carry out "fiduciary obligations" in respect of his judgment delivered on 14 April. As will emerge below, there seems to me to be no basis for that suggestion.

4. Mr Conneely then observed that:

“I, Michael Joseph petition the court that the Judgement to be set aside due to forgery on the following documents Deed of Company Arrangement including the Deed of Guarantee and Indemnity and review the [Justice Nixon] decision as he breached his fiduciary duty and fiduciary responsibility on 14 April 2025 in the constructive trust matter 2023/00230363.”

5. That paragraph broadly corresponds to the relief sought in the Notice of Motion. However, it provides no evidentiary basis by way of the identification of underlying facts in admissible form, for any allegation of forgery in respect of the Deed of Company Arrangement or in a Deed of Guarantee and Indemnity to which reference appears to have been made at the previous application heard by Nixon J. I also note that the "judgment to be set aside" may there refer to the judgment of Nixon J, although the relief which the Plaintiffs sought before Nixon J depended upon a judgment which I delivered in December 2024 ([2024] NSWSC 1585), although Mr Conneely had not appeared at the hearing following which that judgment was delivered.

6. Turning to the history of this application, after Mr Conneely’s Notice of Motion dated 17 April 2025 was filed, it was originally made returnable before a Registrar, but there was no utility in that course where a Registrar plainly had no power to set aside the judgment of Nixon J. By email dated 22 April 2025, my Associate advised the parties, including Mr Conneely, that the matter would be listed in the Corporations Motions List on 5 May 2025.

7. At 8.34pm on the Sunday night before the hearing, an email was sent to my Associate from the email address to which I referred above, which commenced with a statement that "notice to agent is notice to principal, notice to principal is notice to agent"; drew attention that it was addressed to all involved RICO participants, that apparently being a reference to the United States legislation directed to criminal enterprises, which has no apparent application in respect of these proceedings; continued with several biblical references; and then indicated that Mr Conneely "the Executor in Office and Beneficiary of the Cestui Que Vie Trust called Michael Joseph Conneely need to adjourn the matter due to family reasons and being out of the State of New South Wales.” I put aside the reference to a trust in that regard, and note that there is no evidence as to any family reasons or absence from the State that would justify an adjournment, particularly in circumstances where the application is one brought by Mr Conneely which seeks to set aside an order for possession of property.

8. That email in turn indicates a number of other reasons for an adjournment, that appear to have nothing to do with any absence from the jurisdiction, namely a suggestion that an adjournment is needed:

“Due to insufficient paperwork that has not been supplied by the third party interlopers including the commercial contract with a wet ink signature, which has been signed by Michael Joseph and by the involved participants ...".

The email then indicates that Mr Conneely is then seeking a three month adjournment as he is dealing with "family members' sickness and being away from the State of New South Wales”.

9. I pause to note, first, that this is Mr Conneely's application, and the Defendants to it do not have any apparent obligation to provide him with documentation in respect of it. Second, a three month adjournment would plainly be unjustified, where an order for possession has already been made by Nixon J, and this is an application to cause that order to cease to have effect, to the apparent disadvantage of creditors of Mikcon Group Australia Pty Ltd (in liq) (“Company”). There is again no evidentiary basis for the contention of family members' illness or absence from the State, or explanation why a three-month adjournment is necessary in the circumstances.

10. The email then refers to requirements for registration under United States law, and Mr Conneely in turn observes that:

"This is my will the Conneely estate person matter to be adjourned, unless the acting Judge decides to deal ex parte to discharge all charges regarding the Conneely estate/person matter for the following reasons, forged deeds. This is my will!”

11. Obviously enough, the Court deals with questions of adjournment not by giving effect only to the “will” of the applicant on a motion, but instead by reference to its obligation under ss 56-60 of the Civil Procedure Act 2005 (NSW) to bring about the just, quick and cheap resolution of the real issues in dispute in the proceedings. There are in turn references, which I put aside, to prohibitions against slavery in the Criminal Code Act 1995 (Cth).

12. My Associate advised Mr Conneely, in response to that email, that applications for adjournment are not granted based on correspondence to Chambers and any adjournment application would be dealt with in open court today. As I noted above, Mr Conneely did not appear. I am not satisfied, in the circumstances to which I have referred, that the motion should now be adjourned.

13. With that background, I now return to the substantive history of the matter. On 6 December 2024, I heard proceedings brought by Originating Process by the liquidators of the Company seeking several orders against the Defendants, including Mr Conneely and companies associated with him. I delivered my judgment on 10 December 2024 and there observed that the Plaintiffs had established the money claim that was brought against Mr Conneely and their claim for interest on that amount, subject to a recalculation of that amount, and I made orders sought by the plaintiffs under s 66G of the Conveyancing Act 1919 (NSW) and associated orders. I directed the Plaintiffs to bring in short minutes of order to give effect to that judgment and, on 18 December 2024, made orders in accordance with those short minutes of order.

14. Subsequently, on 28 March 2025, the Plaintiffs sought orders for possession of the property, which was the subject of the earlier orders where it appears they had been unable to obtain Mr Conneely's cooperation in respect of those orders. The orders for possession were opposed by Mr Conneely, and that question was addressed by Nixon J's judgment delivered on 14 April 2025. His Honour there recognised the nature of Mr Conneely's challenge to the Plaintiffs' claim, as follows:

“In terms of the challenges to the trustees' claim, including because he did not participate in the hearing and because of fraud, the difficulty dealing with those arguments is that, as matters stand, orders of the Court have been made. If there is a basis for challenging those orders, including because a signature on the documents was forged or because there has been some other fraud, then the proper course is to challenge the reasons for judgment and the orders by way of appeal.”

15. Nixon J there recognised, rightly, that he was not sitting on an appeal from the earlier decision made by the Court, and was required to approach the matter on the basis that those orders had been made and were final and binding orders of the Court unless and until they were set aside on appeal. He also referred to the fact that, in any case, the defence in the substantive proceedings had included admissions in relation to the execution of the relevant documents by Mr Conneely. Nixon J then made orders for possession, which were consequential upon the earlier judgment delivered by the Court. There is, with respect, nothing about that judgment which suggests any element of breach of the duty of Nixon J in respect of a carefully reasoned judgment, which rightly recognised the role of an appeal as a means of a challenge to a substantive judgment at first instance.

Determination of the further motion

16. Returning now to the further Notice of Motion filed by Mr Conneely on 17 April 2025, the first question is whether the Court should permit the re-agitation, today, of the matter which had already been dealt with by Nixon J in respect of the orders for possession. The principles applicable to that matter are addressed by the Court of Appeal in Liu v The Age Company Ltd (2016) 92 NSWLR 679; [2016] NSWCA 115. In my view, where these issues had been addressed in the application for possession, in which Mr Conneely was given an opportunity to be heard, and even if that decision is interlocutory in character, they should not be permitted to be re-agitated today absent a change of circumstances. In any event, the difficulty with the application today is the same as the difficulty with the application brought by Nixon J, namely that it seeks to challenge the result of the substantive judgment, without an application to set aside that judgment being brought on any proper basis, or admissible evidence to support such an application, and without an appeal from that judgment.

17. I recognise that, in some circumstances, the Court has power to set aside an order that was made in a party's absence, if it was made irregularly, or made in the absence of a party, whether or not the absent party had notice of the relevant hearing, and that the Court’s substantive judgment in December 2024 had been made in Mr Conneely’s absence. Those provisions are directed to protecting the right of a party to proceedings to be heard: Cameron v Cole (1944) 68 CLR 571 at 589; [1944] HCA 5; and see the review of the relevant principles by White J in Double Bay Newspapers Pty Ltd v Fitness Lounge Pty Ltd (2006) 57 ACSR 131; [2006] NSWSC 226. However, Mr Conneely was given the opportunity to be heard in respect of the substantive judgment delivered in December 2024, although he did not in fact appear, where there is no suggestion that he was not on notice of that hearing and did not have the opportunity to appear. Second, in any event, notwithstanding the allegations of fraud in respect of underlying documents that were made by Mr Conneely before Nixon J, and may be implicit in the further Notice of Motion filed today, there is no evidentiary basis to establish the proposition now put by Mr Conneely, that someone forged his signature on documents which give rise to liability on his part, particularly where the execution of those documents was, as I noted above, admitted in the substantive proceedings. Even if the Court had jurisdiction, today, to set aside its December 2024 judgment, and Mr Conneely had sought to have that jurisdiction exercised, it does not seem to me that a basis to do so has been established.

18. It also seems to me that, to the extent that this application could be framed as an application to reopen that earlier judgment, that application would also not be permitted, in respect of the substantive judgment, or the application made before Nixon J, because of the public interest in the finality of proceedings: see, for example, Big Money World Pty Ltd v Red Hair Entertainment Pty Ltd [2018] NSWSC 1837. The Notice of Motion should be dismissed for these reasons.

Costs

19. Mr Foley, who appears for the Plaintiffs, seeks an order that Mr Conneely pay the costs of this application on an indemnity basis. Mr Gill, who appeared for the Seventh Defendant which had previously filed a submitting appearance, joins in that application to seek the Seventh Defendant’s costs of the application. I am satisfied that such an order should be made in favour of the Plaintiffs, where they have incurred costs of appearing in respect of the application today, and those costs are unreasonably imposed upon them to the extent that the application re-agitates matters already addressed by Nixon J. I am not satisfied that that order should extend to the costs of the Seventh Defendant which, as Mr Gill acknowledges, had previously filed a submitting appearance although it will now seek to withdraw that as a result of developments in the proceedings. While I accept that the Seventh Defendant has a commercial interest in the matters in issue, it was not necessary for it to appear in order to address this application, in any legal sense, where the Plaintiffs would properly do so.

Risk of further applications

20. It now turn to one remaining matter. Here, there has been a substantive hearing at which the Plaintiffs were put to the costs of obtaining relief against Mr Conneely, and obtained that relief, in December 2024; a hearing before Nixon J, where the Plaintiffs were put to the costs of seeking an order for possession, which they obtained, notwithstanding that Mr Conneely then raised allegations of fraud or forgery in respect of the underlying documents, to which I have referred above; and a further Notice of Motion filed on 17 April 2025 and returnable today, which seeks to re-agitate the matters that were determined by Nixon J, where Mr Conneely did not appear. In these circumstances, the Plaintiffs have obviously been put to significant costs, and those costs are to the detriment of creditors of the Company, to the extent that assets which might otherwise be available to creditors will be used to pay those costs.

21. It seems to me that, in these circumstances, the Court has power to make, and should make, an order of the kind that has been made in several cases, that no further application be brought by Mr Conneely without leave, until the costs of at least the application heard today have been paid. Such an order was made, for example, in Idoport v National Australia Bank Ltd [2006] NSWCA 202 at [29]; Pi v Zhou [2016] NSWCA 148, especially at [23]; Webster v Super Smart Strategies Pty Ltd [2017] NSWSC 531 at [57]-[61] and in K Sheridan v Colin Biggers and Paisley [2019] NSWSC 621 at [26]ff, in respect of an application which had some features in common with the application brought today. It seems to me that there is a significant risk that Mr Conneely, having sought to re-agitate the substantive judgment made in December 2024 before Nixon J, and then sought to re-agitate Nixon J's decision by this motion, will continue that process, without taking the orthodox and possibly available course of bringing an appeal against the substantive judgment. The constraints on his conduct which would otherwise be available from legal representatives’ professional obligations are not available where Mr Conneely is not legally represented. I am satisfied that the interests of justice, the interests of the Plaintiffs and the interests of the Company’s creditors require a restraint upon the re-agitation of these matters, and that the basis for an order of that kind is justified. Consistent with the case law, this order extends beyond proceedings brought in this Court, to any proceedings that may be brought in any Australian Court.

Orders

22. Accordingly, I make the following orders:

23. The Notice of Motion filed by Mr Conneely on 17 April 2025 be dismissed.

24. Mr Conneely pay the Plaintiffs' costs of and incidental to the Notice of Motion filed 17 April 2025 on an indemnity basis, as agreed or as assessed.

25. Order that Mr Conneely not commence or continue any proceedings or bring any further application in any court or tribunal against any of the parties to the proceedings (other than by a claim in the nature of a defence, cross-claim or cross-summons or an appeal from any judgment in these proceedings) which arise on the same or similar facts as the application brought by the deed administrators on 28 March 2025 and the application brought by Mr Conneely on 17 April 2025, without the leave of a Judge of this Court, unless and until Mr Conneely has paid the costs of this application.

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