The "Ongoing Litigation" - Other Sufficient Cause?
29 Before the Federal Magistrate there was no question but that there was proof of each of those matters set forth in s 52(1). Nor was any question raised as to the ability of Mr Russell to pay his debts so as to invoke s 52(2)(a).
30 The case as advanced by Mr Russell before the Federal Magistrate was that he could bring himself within s 52(2)(b) by reason of outstanding litigation and by reason of the pursuit by Polites of the bankruptcy proceedings with a view to stifling the other litigation in which he was involved. The mere fact that Mr Russell asserted or maintained that he had outstanding litigation was, of course, not in itself a "sufficient cause" to not make the sequestration order.
31 The Federal Magistrate, it is respectfully considered, did not err in dismissing Mr Russell's amended application.
32 Similarly, before this Court, the major thrust of Mr Russell's submissions was again that the sequestration order ought not to have been made because "other sufficient cause" for the purposes of s 52(2)(b) was made out by reason of outstanding litigation, being:
the appeal from the decision of Judge Millsteed (the notice of appeal being filed in September 2010);
the appeal from the decision of Judge Herriman (the notice of appeal being filed in April 2011); and
the appeal against the decision of Mr Milazzo SM to be heard by Justice Vanstone on 29 November 2011.
Although the debts relied upon in support of the Creditor's Petition were the allocatur obtained on 16 September 2010 in the sum of $41,997.55 and the costs order for $1,500.00 made on 10 August 2010, Mr Russell obviously cast his challenge to the making of the sequestration order far wider. Each of the orders that have been made against him, and each of his challenges to one or other of those orders, have thus been considered with a view to determining whether "other sufficient cause" can be discerned in any of his outstanding litigation.
33 None of the outstanding litigation relied upon by Mr Russell, it is concluded, constitutes "other sufficient cause". Such litigation needs to be addressed, not for the purpose of this Court purporting to resolve any appeal that may be pending before another Court, but, for the more confined purpose of determining whether any one or other of the appeals may fall within s 52(2)(b).
34 Approached in this manner, it is not considered that the appeal from the decision of Judge Millsteed can be brought within s 52(2)(b).
35 That proceeding was commenced in June 2003. The hearing took place on a number of days in September 2006, September 2007 and November 2007. The apparent delay between 2003 and 2006-2007 was not adequately explained. The expiration of time between the last hearing date in November 2007 and the publication of reasons for decision in July 2009, obviously enough, cannot be visited upon Mr Russell. But, there is no self-evident reason to question the decision of Judge Millsteed that there was "no case to answer". That decision was founded upon conclusions that:
there was a duty of care owed to Mr Russell, but that there was no breach of that duty;
there was a failure on the part of Mr Russell to establish that the third alleged fall upon the stairs was caused by the condition of the stairs; and
there was an exclusion clause in the lease excluding liability.
The exclusion clause, for example, was to be found in cl. 2.30 of the Memorandum of Lease. That clause provided as follows:
To Occupy Premises at his own Risk
To occupy and use the Premises at the Lessee's risk and the Lessee releases to the fullest extent permitted by law the Lessor its servants agents and contractors from all claims and demands of any kind and from all liability which may arise in respect of any accident damage or injury occurring to any person or property in or about the Premises or the Building.
After having addressed the former two bases upon which the decision was based, Judge Millsteed went on to conclude:
The exclusion clause
[110] Although the above findings are sufficient to uphold the submission of no case to answer I proceed to consider PIPL's argument that, regardless of whether or not the lease included the stairs, the plaintiff has no claim because he agreed to "occupy and use the premises" at his own risk and to release PIPL "its servants and agents and contractors from all claims and demands of any kind and from all liability which may arise in respect of any accident damage or injury to any person or property in or about the premises of the Building" (Cl 2.30).
…
[116] In the present case, the essential question is, what would reasonable people in the position of the parties have taken the clause to mean, read in the light of the Agreement as a whole?
[117] As earlier observed the exclusion clause purports to release PIPL "to the fullest extent permitted by the law from all claims and demands of any kind and from all liability which may arise in respect of any accident damage or injury". There is no express reference to negligence, however, giving these words their plain and natural meaning, and having regard to the context in which they appear, they are plainly wide enough to embrace liability for negligence. There is, in my view, no ambiguity that warrants construing the clause contra proferentem. To my mind this construction is also consistent with the Agreement placing no obligation on PIPL to maintain and repair the premises.
[118] Accordingly, I accept PIPL's submission that, regardless of whether or not the stairs were included in the lease, the plaintiff had agreed to release PIPL from liability in negligence for any type of accident "in or near" the demised premises. Because the stairs were either "in or near" the demised premises the exclusion clause operates to exclude PIPL from liability in respect of the plaintiff's alleged fall: [[2009] SADC 73]
Irrespective of such difficulties as may be encountered by reason of the notice of appeal from that decision being filed over a year after the decision was published, there is no reason to conclude that an appeal has any such prospects of success as to constitute "other sufficient cause".
36 Nor could any challenge to the decision of Judge Herriman fall within s 52(2)(b).
37 The notice of appeal filed in April 2011 challenging the decision of Judge Herriman reads as follows:
(APPEAL 1) AND NEW TRIAL EXTENSION OF TIME FOR APPEAL. APPEAL AGAINST SECURITY COST
(APPEAL 2) AGAINST ORDER ON MASTER BLUMBERG ORDER 31 MAY 2010 AND EXTENSION OF TIME DENIED AND INTERLOCUTORY APPLICATION TO SET ASIDE THE DEFENDANTS ALLOCATUR
The grounds of appeal are there set forth as follows:
THE APPEALANT BELIEVES THE LEASE IS NOT A BONA VIDE LEASE AND THE RESPONDENT BREACHED STATUTONIAL REQUIREMENTS IN ASSIGNING SAID LEASE BUT HAS BEEN UNABLE TO HAVE THE CASE TO BE HEARD TO ESTABLISH THIS
38 The challenge to the allocatur in respect of costs in the sum of $41,997.55, it should be noted at the outset, confronts considerable difficulties. The order of Master Blumberg dismissing the proceeding in the District Court for want of prosecution, without more, seems unexceptional. So, too, seems the consequential order for costs. Master Blumberg delivered ex tempore reasons on 31 May 2010 for making his order dismissing the proceeding for want of prosecution and for ordering that "the costs of the Action be the defendant's costs to be agreed or taxed." Such orders as to costs necessarily involve exercises of discretion which are difficult to upset on appeal. The subsequent quantification for costs in the sum of $41,997.55 seems equally unexceptional, especially in circumstances where a previous order that security for costs be provided had not been complied with. But, whatever may be the prospects of success on appeal, there are considered to be insufficient prospects of success to warrant the conclusion that that appeal can be brought within s 52(2)(b).
39 Not without significance are the views expressed by the Federal Magistrate with respect to any challenge to the decision of Judge Herriman. The Federal Magistrate recounted the history of the litigation between the parties and extracted the "strong views" expressed by Judge Herriman: Russell v Polites Investments Pty Ltd [2011] FMCA 476 at [16]. The Federal Magistrate thereafter referred to Judge Herriman's characterisation of the litigation before him as "frivolous, vexatious and an abuse of court process". The Federal Magistrate expressed agreement with this "characterisation of that litigation": [2011] FMCA 476 at [27]. For present purposes it is sufficient to conclude that no error is discernible in the reasons of the Federal Magistrate and that any appeal from the decision of Judge Herriman would not constitute "other sufficient cause" for the purposes of s 52(2)(b).
40 Finally to be considered is the challenge to the costs order made on 10 August 2010 by Mr Milazzo SM for $1,500.00. Any challenge to that order, without more, would probably have assumed little importance. But any challenge has now been resolved. On 29 November 2011, Justice Vanstone struck out Mr Russell's notice of appeal. Her Honour characterised the proceeding before her as "an appeal and an application for an extension of time within which to appeal against an order made by Mr Milazzo SM in the Magistrates Court on 10 August 2010 for payment of costs to the respondent in the sum of $1500." Her Honour found that "the appeal notice is incompetent." That appeal is thus no longer outstanding and cannot fall within s 52(2)(b).
41 The difficulties confronting Mr Russell in the pursuit of any of his appeals were summarised during the oral submissions of Senior Counsel for Polites. Although it was not to be expected that Mr Russell as a self-represented litigant would seek to rebut each of the submissions made against him in any great detail, it should be noted that he made no real attempt to lay the groundwork for a submission that the appeals had any real prospects of success. Such submissions as were advanced by Mr Russell repeatedly made reference to what he referred to as "fraud" and "perjury". The further Affidavit filed by Mr Russell on 7 December 2011 returned to these allegations referring, for example, to "the Creditor's Polites petition of $43,497.55 as being a corrupt manipulation of the process". Those submissions and allegations, with respect to Mr Russell, are groundless.
42 Moreover, even if it be concluded - contrary to the conclusion in fact reached - that the "ongoing litigation" satisfies the requirements of s 52(2)(b), it is not considered that the discretion conferred by s 52(2)(b) should be exercised in favour of Mr Russell. Irrespective of the prospects of success of any of the appeals presently being pursued by Mr Russell, it is considered that the discretion should be exercised such that the sequestration order should remain because the history of the litigation exposes in part the fact that:
Mr Russell has sought to re-agitate issues that have previously been resolved against him; and
Mr Russell has not complied with orders made by other Courts and has thereafter sought to resist the consequences of his non-compliance in a manner which seemingly lacks merit.
The oral submissions of Mr Russell that he has actively pursued the litigation he has commenced and that such delays as have been encountered are not to be visited upon him are noted. A dispute which has its origins in facts which took place in 1999 should nevertheless have been resolved long ago. Why it has not been resolved was not satisfactorily explained by Mr Russell.
43 The "ongoing litigation" referred to in Ground 1 of the Notice of Appeal does not constitute "other sufficient cause" within the meaning of and for the purposes of s 52(2)(b). Nor does the unspecified "judicial inquiry" referred to in Ground 3.