Are there substantial reasons for questioning whether the debt is owing?
51 Mr Dimitriou argued that his case was similar to the respondent's case in Ramsay. In Ramsay, the appellant commenced proceedings against the respondent in the Supreme Court of New South Wales claiming money that was said to be owing under a guarantee. The appellant's statement of claim put the quantum of the respondent's indebtedness in issue, however the respondent raised only a non est factum defence and did not put quantum in issue. That defence was unsuccessful and judgment was entered against the respondent for an amount which had been certified by the appellant pursuant to a clause in the guarantee. The respondent failed to comply with a bankruptcy notice based on the judgment and the appellant subsequently presented a creditor's petition.
52 The respondent in Ramsay opposed the creditor's petition on the basis that there was no debt owing and filed an interim application seeking an order that there be a separate determination of whether the court should exercise its discretion to go behind the judgment to investigate the debt on which the creditor's petition was based. At the hearing of that application, the respondent produced a "reconciliation" which he contended showed that the appellant in fact owed money to the company whose indebtedness was guaranteed by the respondent. The reconciliation was supported by evidence. There was also evidence from one of the liquidators of the company whose debt was guaranteed by the respondent to the effect that it was more likely that the appellant was indebted to that company than vice versa. Counsel for the appellant conceded before the primary judge that there was enough evidence to show that there was a matter that upon further inquiry might lead to a different result.
53 The primary judge in Ramsay dismissed the interim application and held that he had no discretion to go behind the judgment. That decision was overturned by the Full Court and the appellant's appeal to the High Court was dismissed. The plurality in the High Court (Kiefel CJ, Keane and Nettle JJ) upheld the Full Court's finding that there was a substantial question as to whether the debt on which the appellant relied was owing. Two considerations appeared to be significant to their Honours in arriving at that conclusion. The first was that the unexplained failure of the respondent's legal representatives to present the respondent's case on its merits gave rise to a concern that this was not a judgment which was "the outcome of the rigorous processes of adversarial litigation" (at [70]-[71]). The second was that there was evidence before the primary judge "which, while it remained uncontradicted, was apt to suggest that the debt was not truly owing" (at [71]).
54 The difficulty for Mr Dimitriou is that the facts and circumstances in Ramsay are far removed from the facts and circumstances of this case. That is so for at least three reasons: first, Mr Dimitriou did not adduce any cogent or reliable evidence to suggest that the judgment upon which the bankruptcy notice and creditor's petition was based was not the outcome of the rigorous processes of adversarial litigation; second, Mr Dimitriou did not adduce any cogent or reliable evidence which was apt to suggest that the debt is not truly owing; and third, counsel for Pineview did not concede that there was enough evidence to show that there was any matter which upon further inquiry might lead to a different result.
55 In his affidavit filed in support of his notice of opposition, Mr Dimitriou simply asserted that he had a counter-claim, set-off or cross-demand in an amount which exceeded the amount claimed in the bankruptcy notice and creditor's petition. No details of that counter-claim, set-off or cross-demand were provided in the body of the affidavit. Mr Dimitriou also asserted that the counter-claim or set-off was not raised in the proceedings before White J. He did not, however, explain why that was so. Perhaps more significantly, this bare assertion was contradicted by assertions contained in another affidavit sworn by Mr Dimitriou, and by submissions which were made on his behalf, the effect of which was to concede that the set-off claims were raised before White J, but were not "fully argued" or "fully considered".
56 As has already been adverted to, Mr Dimitriou's affidavit purported to exhibit a large bundle of documents which filled four lever-arch folders. That bundle was not appropriately indexed or paginated and included affidavits apparently sworn for the purposes of other proceedings which also annexed or exhibited documents. For the reasons already given, only those documents within that bundle that the Court was individually and specifically taken to were admitted into evidence and, to the extent that those documents comprised affidavits filed in other proceedings, those affidavits were admitted only as evidence of what Mr Dimitriou had asserted in those proceedings, not as evidence of the truth of their contents.
57 The documents in the exhibit that the Court was taken to showed that Mr Dimitriou had made assertions about the existence of set-off claims against Ms Huybers in other proceedings, most notably proceedings in the Federal Circuit Court of Australia, and that he had prepared various schedules and spreadsheets to that end. Some documents that were said to be source documents for the schedules were also annexed to the affidavits, though the affidavits did not themselves provide any, or any adequate, explanation of the schedules or their contents, or any adequate description or narrative of the underlying documents. Perhaps more significantly, the affidavits did not provide any proper factual basis for the assertion that the items referred to in the schedules or spreadsheets were payments or transactions which were properly credited to Mr Dimitriou, or properly set-off against any debt owed by Mr Dimitriou to Pineview.
58 As has already been noted, Mr Dimitriou's amended notice of opposition deleted those paragraphs of the original notice of opposition that referred to him not being indebted to Pineview, or having a cross-claim against Pineview which exceeded the amount of the judgment debt. Shortly prior to the hearing, however, Mr Dimitriou filed an interlocutory application seeking an adjournment of the hearing. That application was supported by another affidavit sworn by him. The adjournment application was refused, however, Mr Dimitriou was granted leave, ultimately without opposition, to read certain paragraphs of that affidavit in support of his opposition to the creditor's petition. In one of those paragraphs, Mr Dimitriou asserted that the "balance of that claim [the third cross-claim in the proceedings before White J] was not fully considered in the decision of Justice White" and that "on balance of account, I am in fact a creditor of Pineview …and that Pineview is indebted to me in the sum of $18,895.38".
59 Mr Dimitriou also annexed to his affidavit sworn on 14 December 2018 three detailed schedules or spreadsheets: one headed "Rubino Group & Pineview Group & Susan Huybers Group Reconciliation period from May 2010 to August 2012"; one headed "Susan Huybers Disbursement as at 22 January 2016"; and one headed "Wyse Accounting Pty Ltd Account Transactions [Accrual]". The schedules and spreadsheets were by no means self-explanatory, and yet Mr Dimitriou's affidavit contained no, or no satisfactory, explanation of exactly what the schedules or spreadsheets depicted, or purported to depict, and no satisfactory explanation of the provenance of the information contained in them. It would appear that those were the same schedules that had been relied on in the proceedings in the Circuit Court, though as noted earlier, the explanations given in the affidavits filed in those proceedings were also by no means satisfactory, let alone cogent. The calculations in the schedules did not appear to marry up in any comprehensible way to the assertions contained in Mr Dimitriou's affidavit.
60 Two further important points should be made concerning the schedules or spreadsheets upon which Mr Dimitriou apparently relied.
61 First, the schedules or spreadsheets do not distinguish between payments or amounts that it was said should be set-off against the judgment in favour of Pineview, as opposed to payments or amounts that might properly be set-off against the judgment in favour of Ms Huybers. Indeed, the majority of the entries in the schedules appear to relate to payments made to, or for the benefit of, Ms Huybers. The basis upon which it might be contended that those amounts were able to be set-off against Mr Dimitriou's liability to Pineview was not explained.
62 Second, the schedules do not indicate which of the payments or transactions were the subject of consideration and determination in the proceedings before White J. As will be seen, it is abundantly clear that in the proceedings before White J, Mr Dimitriou contended that certain payments which had been made to, or for the benefit of, Pineview and Ms Huybers should be set-off against any amounts for which he was held liable to those parties. So much so was conceded on Mr Dimitriou's behalf in this proceeding. It was, however, asserted that Mr Dimitriou's set-off or counter-claim against Pineview and Ms Huybers was not fully raised before White J. Putting aside, for present purposes, the fact that the basis of that assertion was never provided or explained, the difficulty with the schedules or spreadsheets relied on by Mr Dimitriou is that they do not identify which, if any, of the payments or transactions depicted in them were not raised in the proceedings before White J.
63 In summary, on just about any view, the evidence relied on by Mr Dimitriou in these proceedings concerning the existence of a set-off or cross-claim against Pineview was unsatisfactory and inadequate. For the most part, it consisted of little more than bare assertion. To the extent that the schedules or spreadsheets rose above bare assertion, they were confusing, not properly explained and not appropriately supported or verified by admissible, let alone cogent or comprehendible, evidence.
64 The assertions in Mr Dimitriou's affidavit and the documentary exhibits must also be considered in light of White J's reasons for judgment and the events that followed the handing down of that judgment.
65 White J's reasons for judgment were, to say the very least, detailed and comprehensive. His Honour dealt with Pineview's cross-claim against Mr Dimitriou at [258] to [306]. Pineview claimed the sum, which is referred to in the reasons as "$2,000,820 (sic) plus interest" from Mr Dimitriou and companies associated with him. The claim properly appeared to be for $2,000,720 (see Rubino v Pineview at [8]) which, in simple terms, represented the loan funds that Mr Dimitriou had secured on behalf of Pineview. Justice White found that Mr Dimitriou was liable to Pineview because he disbursed the proceeds of the loan in breach of his fiduciary duty (see [261] - [263]), had committed the tort of deceit (see [264]) and was liable for damages for unconscionable conduct in contravention of s 20 of the Australian Consumer Law (see [265]). His Honour found that Pineview was entitled to judgment against Mr Dimitriou and the two companies associated with him for the monies received by them "except insofar as the moneys were applied to meet the liabilities of Pineview" (see [273]).
66 Importantly, at [287] to [300], White J dealt at considerable length with claims by Mr Dimitriou and the companies associated with him that Pineview was required to give credit for numerous payments that were supposedly made for or on its behalf. His Honour found that Mr Dimitriou was entitled to a credit in respect of a number of payments. The judgment amount of $1,276,389.29 was arrived at by deducting those payments for which Mr Dimitriou was entitled to a credit from the total moneys that Mr Dimitriou and the companies associated with him received from the bank.
67 It should also be noted in this context that White J also found that Mr Dimitriou and the companies associated with him were also liable to indemnify Ms Huybers against her liability to the bank under the guarantee she gave in respect of the loan to Pineview (see [309]). His Honour also dealt at length with claims that Mr Dimitriou and the companies associated with him made in respect of payments that were said to have been made for the benefit of Ms Huybers (see [315] - [375]). His Honour annexed to the reasons a schedule entitled "Susan Huybers reconciliation as at 14 June 2016" which depicted Mr Dimitriou's set-off claims against Ms Huybers.
68 It is thus abundantly clear that White J considered and made detailed findings about Mr Dimitriou's set-off claims against Pineview and Ms Huybers. There is nothing in the judgment to suggest that Mr Dimitriou was prevented or inhibited in any way from adducing evidence and presenting arguments in support of his set-off claims against both Pineview and Ms Huybers. That is completely at odds with Mr Dimitriou's bare assertion, in the affidavits filed in this proceeding, that his supposed cross-claim or set-off against Pineview and Ms Huybers was either not raised in the proceedings before White J at all, or was not "fully considered" in White J's judgment.
69 As was noted earlier, Mr Dimitriou filed an appeal against the orders and judgment of White J. His amended notice of appeal contained 192 grounds. Significantly, only one of those 192 grounds concerned White J's findings concerning Mr Dimitriou's set-off claims. That ground, ground 187, appeared to assert no more than that White J erred in not accepting all of the claimed set-off amounts. It was not contended that Mr Dimitriou was prevented or inhibited in any way from adducing evidence or advancing arguments in support of his set-off claims.
70 In any event, as also noted earlier, Mr Dimitriou's appeal was dismissed because he did not comply with orders made in relation to the conduct of the appeal. His attempt to effectively reverse that dismissal was rejected by Meagher JA. In the course of considering Mr Dimitriou's application, Meagher JA considered Mr Dimitriou's grounds of appeal and the submissions that he had made in support of them. That included Mr Dimitriou's grounds of appeal concerning the findings made by White J in relation to Mr Dimitriou's set-off claims. His Honour concluded that Mr Dimitriou's grounds of appeal had no realistic prospects of success: Dimitriou v Huybers [2017] NSWCA 262 at [56]. Mr Dimitriou's application for review of the decision of Meagher JA was dismissed: Dimitriou v Huybers (No 2) [2018] NSWCA 62.
71 It should also be noted that Meagher JA acknowledged that it would be open to Mr Dimitriou to apply for an extension of time to commence fresh appeal proceedings. There is no evidence to suggest that Mr Dimitriou has sought an extension of time to commence fresh appeal proceedings.
72 Mr Dimitriou made another attempt to re-agitate his set-off claims or cross-claim against Pineview in an application to stay White J's judgment. That application was heard by Parker J in the Supreme Court of New South Wales on 6 March 2018. His Honour rejected the application: Rubino v Pineview Properties Pty Ltd (No 6) [2018] NSWSC 340. Parker J dealt with Mr Dimitriou's assertions in relation to his set-off claims as follows (at [22]):
Mr Dimitriou also asserted that there were liabilities on the part of Ms Huybers or Pineview which should be set off against the judgment liabilities. In determining the quantum of the judgments, White J considered a number of items of set-off or allowance. Some he accepted and some he did not. It was not clear to me from Mr Dimitriou's submissions whether the liabilities to which he referred in the application before me were ones which had been considered by White J and rejected, or whether they arose separately. It was not even clear which judgments they should allegedly have been set off against. Either way, I do not think these submissions advance Mr Dimitriou's position. To the extent that the claimed set-offs had been rejected by White J, Mr Dimitriou needed to identify, as a first step, arguable grounds of appeal against his Honour's decision, and then to identify relevant grounds of appeal and submissions which it could be said had been erroneously discounted by Meagher JA. Mr Dimitriou did not do this. To the extent that the alleged liabilities arose separately from the matters considered by White J, they fall outside the scope of these proceedings and the appeal. The proper approach would have been for Mr Dimitriou to commence substantive proceedings in an appropriate court with a view to obtaining a judgment which could be used as a basis for set off (see Civil Procedure Act 2005 (NSW), ss 21 and 22) or at least a stay of execution pending determination of the proceedings. No such independent proceedings appear to have been brought.
73 There is no evidence to suggest that Mr Dimitriou has taken up Parker J's suggestion to commence "independent proceedings" in an appropriate court in respect of any set-off claims that were not fully litigated before White J.
74 As discussed later, Mr Dimitriou did, subsequent to the hearing on 14 December 2018, commence separate proceedings in this Court against Pineview and other parties. It also appears that Mr Dimitriou subsequently commenced, or at least intended to commence, proceedings in the Supreme Court which essentially mirrored the separate proceedings commenced in this Court. It suffices at this point to note that those separate proceedings appear to raise an entirely different set-off argument to the argument which was raised in opposition to the creditor's petition at the hearing on 14 December 2018.
75 That was not the end of Mr Dimitriou's attempts to stay the judgment of White J. On 13 December 2014, the day prior to the hearing of Pineview's creditor's petition, Mr Dimitriou filed yet another notice of motion in the Supreme Court seeking, amongst other things, an order that the orders made against him by White J be stayed. The basis of that application appears again to be that "upon the balance of account" of the claims as between Mr Dimitriou, Pineview and Ms Huybers, or on the basis of what is said to be a claim which Mr Dimitriou has "by way of equitable set-off", Pineview is in fact indebted to Mr Dimitriou in an amount of $18,895.38. The affidavit filed in support of this affidavit, which is another affidavit sworn by Mr Dimitriou, effectively simply annexed the schedules or spreadsheets referred to earlier. The application had obviously not been heard as at the date of the 14 December 2018 hearing.
76 In the submissions made on Mr Dimitriou's behalf in this proceeding, it was conceded that Mr Dimitriou had raised the set-off claim in the proceedings before White J, or at least that "there were certainly aspects of the set-off claim that were run and considered". It was submitted, however, that "the whole of the set-off was not looked at". There are a number of problems with that submission. First, and most significantly, to the extent that it was supported by any evidence, that evidence rose no higher than bare assertion by Mr Dimitriou. Second, no attempt was made to identify exactly what part or parts of the alleged set-off claim were not raised before White J. That was similar to the problem identified by Parker J. Third, even if some aspects of the set-off claim were not raised before White J, no explanation, and certainly no adequate or satisfactory explanation, was given for why that was so.
77 In his submissions, Mr Dimitriou relied on the fact that he was not cross-examined on his affidavit, in particular in relation to his assertion that he has a set-off or cross-claim that exceeded the amount claimed in the bankruptcy notice and creditor's petition and that that claim was not raised in the proceedings before White J. He was also not cross-examined on his affidavit evidence that Pineview in fact owed him $18,895.38. As indicated earlier, the fact that Mr Dimitriou was not cross-examined may be explained by the fact that Mr Dimitriou had amended his notice of opposition in a way which suggested that he did not intend to raise any opposition based on the existence of a cross-claim or set-off. Pineview claimed that there it had not challenged that assertion by Mr Dimitriou because the set-off claim had been abandoned by Mr Dimitriou in the amended notice of opposition. That claim only resurfaced at the very end of his submissions in the context of the otherwise unparticularised claim that there was "other sufficient cause" why a sequestration should not be made. The failure to cross-examine should not, in those circumstances, be taken to be a concession by Pineview that Mr Dimitriou's evidence about those matters should be accepted as being unchallenged or undisputed.
78 Even putting that consideration to one side, the fact remains that Mr Dimitriou's evidence rose no higher than bare assertion and was deserving of little weight. It was tolerably clear that Pineview's position was that the set-off claims had been fully litigated before White J and that Mr Dimitriou's bare assertion to the contrary was disputed and deserving of no weight. The absence of cross-examination should be considered in that context.
79 In all the circumstances, Mr Dimitriou failed to demonstrate that there were "substantial reasons" for questioning whether behind the judgment of White J there was in truth and reality a debt due to Pineview. The evidence adduced by Mr Dimitriou did not reliably or persuasively demonstrate that his claimed set-off was not fully litigated before White J or that there was any failure on his part to "present his … case on its merits in the litigation that led to the judgment": cf. Ramsey at [70]. The evidence adduced by Mr Dimitriou on that issue did not rise beyond bare assertion. He did not even attempt to explain what parts of his claim were not raised before White J and why or in what circumstances they were not raised. The judgment of White J comprehensively dealt with all of the claims advanced by Mr Dimitriou concerning payments that he alleged had been made to, or on behalf of, Pineview and which therefore should be set-off against the amount that his Honour otherwise found that Mr Dimitriou was liable to Pineview. There is nothing in the judgment itself which suggests that Mr Dimitriou was not given every opportunity to adduce whatever evidence he chose to adduce and advance whatever arguments he wanted to advance in respect of the alleged set-off claims.
80 Even if Mr Dimitriou's bare assertion that his set-off claims were not fully considered by White J was to be accepted, he nevertheless did not adduce any, or any satisfactory or comprehendible evidence concerning the nature or details of his claims that were not considered by White J. All he did was assert the quantum of that claim and tender schedules or spreadsheets that were neither self-explanatory nor properly supported or verified by admissible, let alone cogent, evidence. The schedules did not appropriately delineate between payments or transactions that were raised before White J and those that were supposedly not, or delineate between payments or transactions that were said to provide a set-off against amounts payable to Pineview, as opposed to Ms Huybers. In all the circumstances, the evidence was not "apt to suggest that the debt was not truly owing": cf. Ramsey at [71]. Nor was there any concession by Pineview that the evidence adduced by Mr Dimitriou was sufficient to show a matter that upon further inquiry might lead to a different result: cf. Ramsay at [19].
81 Justice White's judgment was handed down over two years ago. In the lengthy period since the judgment was handed down, Mr Dimitriou has unsuccessfully sought to appeal the judgment and unsuccessfully sought to stay its execution. It is readily apparent that in the course of so doing, Mr Dimitriou has been unable to articulate any arguable appeal ground in relation to White J's findings concerning the set-off claims advanced by Mr Dimitriou in that proceeding. Nor has he been able to adequately articulate any arguable claims of set-off against Pineview that were not raised in the proceeding before White J, let alone adduce any acceptable evidence of any such claims.
82 Finally, it should be reiterated that the manner in which Mr Dimitriou sought to raise this ground of opposition to the creditor's petition was most unacceptable. He initially included in his notice of opposition the contention that there were substantial reasons to go behind the judgment and the contention that he had a genuine and arguable claim against Pineview. His notice of opposition was supported by an affidavit that did little more than make a series of broad and sweeping assertions and exhibit an amorphous mass of documents which for the most part remained unexplained. After securing the services of counsel, he then amended his notice of opposition to delete any express claim that the Court should go behind the judgment or any contention that he had a counter-claim or set-off claim against Pineview. After failing to secure an adjournment of the hearing of the creditor's petition and his opposition to it, he then sought to re-agitate those claims, without appropriate notice to Pineview, under the guise of the broad and general ground that there was "other sufficient cause" why a sequestration order ought not be made. Even then, the submissions that were made on Mr Dimitriou's behalf failed to satisfactorily articulate the precise nature of Mr Dimitriou's counter-claim or set-off claim against Pineview, failed to delineate those parts of the counter-claim or set-off that were not litigated before White J, and failed to identify the evidence that was said to support those parts of the claims.
83 The unsatisfactory manner in which Mr Dimitriou pursued this aspect of his opposition to the creditor's petition cast considerable doubt on the genuineness of his claims and considerable doubt on Mr Dimitriou's assertion that there were any reasons, let alone substantial reasons, for questioning whether behind the judgment there was in truth and reality a debt due to Pineview.
84 I am, in all the circumstances, not persuaded or satisfied that Mr Dimitriou has demonstrated that this is an appropriate case for the Court to exercise its discretion to go behind the judgment of White J. This ground of opposition to the creditor's petition is accordingly rejected.