(5) In this section, action means any civil proceeding, whether at law or in equity."
9 In Arnoya Holdings Pty Ltd v Metway Leasing Ltd [1999] NSWCA 120 at [14], Sheller JA said this:
"[14] The situation is however that regardless of whether this point is taken by the parties, s 60 dictates the consequence of a trustee making an election or failing to make an election, whether to prosecute or discontinue an action. Within the meaning of "action" is included an appeal such as the appeal presently brought by Mr and Mrs Campbell. In that respect, I refer to the decision of the Full Federal Court in Bryant v the Commonwealth Bank of Australia (1997) 75 FCR 545."
10 The plaintiff contends that Ms Bhatti has no right to appear in these circumstances to prosecute her cross-claim or to propound her defence. Whereas Ms Bhatti did not contest, and I have no difficulty accepting, the correctness in this case of the former proposition, I have some concerns about the correctness of the latter. Section 60(2) provides that except for certain limited actions, legal actions brought by the bankrupt before the bankruptcy are stayed from the date of the bankruptcy until the trustee elects either to prosecute or to discontinue the action: see Re Lofthouse [2001] FCA 25; (2001) 107 FCR 151. If the trustee has not made an election, any party to the action may serve a notice on the trustee, and if the trustee refrains from making an election for 28 days the trustee is deemed to have "abandoned" the action: s 60(3). Whether there is a decision to abandon or a deemed abandonment is not of significance, but the terms of any decision to abandon should be made clear: Cole v Challenge Bank Ltd [2002] FCAFC 200. An "action" in s 60 includes a right of appeal. However, it does not appear to include a right to defend proceedings commenced against the bankrupt before the bankruptcy. If it does not, then s 60 does not apply to restrict Ms Bhatti's right to propound her defence in these proceedings on her own account.
11 When the proceedings came before me on 1 October 2010, there was insufficient time by reason of my other commitments on that day to hear detailed argument on this point. I consider that it should be addressed carefully before I proceed further with the plaintiff's application.
12 There is another matter of concern. The plaintiff's notice of motion is described as one apparently seeking default judgment. I do not understand what that means in the particular circumstances of this case. There is in the Court file a very detailed defence filed by Ms Bhatti on 5 May 2009. If I am not mistaken, it has never been struck out or withdrawn. It remains the current defence of Ms Bhatti.
13 Paragraph 20 of an affidavit sworn by Danielle Catherine Kuti on 30 September 2010, which was read by the plaintiff on the present application, is in the following terms:
"20. On the morning of 28 April 2009 DibbsBarker received for the first time an affidavit of Mr Sweeney sworn 28 April 2008 which annexed that proposed defence. At the time of receiving the affidavit of Mr Sweeney sworn 28 April 2008 I was advised by Ms Bhatti's legal team that Ms Bhatti only intended to rely on that affidavit and the defence and no longer intended to rely on any evidence previously served by her. As a result of receiving that affidavit, instructions were obtained to consent to orders that were ultimately made, including setting aside the default judgment, requiring Ms Bhatti to reply to a request for particulars from NAB and relisting the proceedings on 3 June 2009. Ms Bhatti was also ordered to pay NAB's costs thrown away by reason of the default judgment and the costs of the application."
14 Mr Sweeney's affidavit is not in the Court file and I was not otherwise taken to it. I am unaware of the significance of anything that it contains or the significance of the reference to it by Ms Kuti in the paragraph of her affidavit to which I have just referred. If the plaintiff maintains somehow that it agreed to set aside the judgment against Ms Bhatti, which it had obtained by default, on terms that were not adhered to, or otherwise upon some basis that turned out to be incorrect, then such a contention has not been adumbrated clearly before me and is not readily apparent from the terms of Ms Kuti's affidavit.
15 For present purposes the defence is significant because if it remains as a current pleading upon which Ms Bhatti is entitled to rely then what the plaintiff is actually seeking is not judgment by default at all but summary judgment. It may also be that the plaintiff says that the defence is susceptible to being struck out as disclosing no defence or because it has a tendency to cause prejudice, embarrassment or delay or is otherwise an abuse of the process of the Court. I have not heard submissions on any of these matters.
16 Neither in Ms Kuti's affidavit sworn on 30 September 2010, nor in her earlier affidavit sworn 3 September 2010, on both of which the plaintiff relies, is there any statement of a belief or other suggestion that Ms Bhatti does not have a defence to the plaintiff's claim or to any part of it. The form of the defence is not insubstantial and the nature of the matters pleaded suggests on one view that Ms Bhatti has an arguable defence. I re-emphasise that I have heard no submissions on this or upon whether the defence could withstand an application pursuant to either UCPR 13.1 or 14.28. Having regard to the principles most often associated with cases such as General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 at 129, Dey v Victorian Railway Commissioners [1949] HCA 1; (1949) 78 CLR 62 at 91 and Brimson v Rocla Concrete Pipes Ltd [1982] 2 NSWLR 937 at 942, it does not seem to me to be possible to dispose of the plaintiff's application without submissions and detailed consideration of these further matters. As is well recognised, these and other cases to like effect point to the requirement of a high degree of certainty before a party will be deprived of the opportunity to have his or her or its claim determined in the usual way: Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552.
Result
17 In these circumstances it seems to me that I should stand this application over for further argument at some time convenient to the parties and to the Court. I should wish at that time to revisit the assumption apparently made by all concerned on the last occasion that Ms Bhatti was not entitled to appear and be heard in her defence to the plaintiff's claim in the proceedings, as well as to receive argument or submissions on the precise nature of the orders or relief sought by the plaintiff in its notice of motion, and its entitlement to that relief.