Sweeney v Australian Financial Complaints Authority

1. The applicant pay the second respondent's costs of the proceeding.
2. A Registrar assess the second respondent's costs through a lump sum costs procedure.
3. The second respondent file and serve its affidavit in support, not exceeding 5 pages (omitting formal parts), by 10 February 2022.
4. The applicant file and serve his affidavit in response, not exceeding 5 pages (omitting formal parts), by 3 March 2022.
5. The lump sum costs procedure be listed before a Registrar for hearing not before 10 March 2022. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

O'CALLAGHAN J: 1 At the hearing conducted on 29 November 2022, I made an order dismissing the proceeding, and directing that the applicant and the second respondent (NULIS) file submissions about costs, which they did. (The first respondent (AFCA) did not seek its costs.) 2 I said at the end of the hearing that I would provide brief reasons for dismissing the proceeding, consistently with the content of exchanges between the court and the applicant. These are those reasons, which also address the question of costs. 3 I dismissed the proceeding because it became apparent from submissions made by the applicant, who was self-represented, that he disavowed the case he put in his amended notice of appeal filed on 31 March 2022. 4 The applicant, Mr Sweeney, purported to appeal from a decision of the first respondent made on 8 October 2021. 5 The relevant facts, which were not disputed, were these. 6 A fund known as the Provident Fund was first established on 23 December 1913 by Elder Smith and Co Limited (the employer) to provide benefits to certain of its employees. Over time, the employer became known as Elders IXL Limited and later Foster's Group Limited (after Elders IXL Limited acquired Carlton and United Breweries Ltd). 7 Mr Sweeney was an employee of Carlton and United Breweries Ltd (and its successor entities) between 25 March 1985 and 18 October 2006. When Mr Sweeney's employment ceased, the then trustee of the Provident Fund, CCSL Limited (CCSL), made a determination about the superannuation benefit payable to Mr Sweeney. A lump sum benefit in the amount of $309,297.43 was paid to Mr Sweeney on 18 January 2007, and Mr Sweeney ceased to be a member of the Provident Fund. 8 NULIS is the trustee of a superannuation fund called the MLC Super Fund. The members and assets of that fund have been supplemented over time, relevantly, by reason of two earlier "successor fund transfers". 9 Successor fund transfers are governed by the Superannuation Industry (Supervision) Regulations 1994 (Cth). Regulation 6.29 creates an operating standard for regulated superannuation funds that generally prohibits a member's benefits in a fund being transferred from the fund unless the member has consented (or is reasonably believed by the trustee to have consented) or the transfer is to a fund satisfying the conditions of a "succesor fund", which is defined by reg 1.03 as follows: successor fund, in relation to a transfer of benefits of a member firm from a fund (called the original fund), means a fund which satisfies the following conditions: (a) the fund confers on the member equivalent rights to the rights that the member had under the original fund in respect of the benefits; (b) before the transfer, the trustee of the fund has agreed with the trustee of the original fund that the fund will confer on the member equivalent rights to the rights that the member had under the original fund in respect of the benefits. 10 A successor fund transfer can encompass only a transfer of benefits of a member with a right in the original fund in respect of those benefits at the time of transfer. As Mr Sweeney was no longer a member of the Provident Fund, he was not among those whose benefits were transferred in the first successor fund transfer (to the Plum Superannuation Fund) on 20 January 2014, nor the second successor fund transfer (from the Plum Superannuation Fund to the MLC Super Fund) on or around 1 July 2016. That is, Mr Sweeney never became a member of the Plum Superannuation Fund, nor of the MLC Super Fund. Furthermore, NULIS was never appointed in substitute for, or replacement of, CCSL as trustee of the Provident Fund (nor, for that matter, substitute for, or replacement of, the trustee of the Plum Superannuation Fund). 11 By letter dated 10 May 2021, Mr Sweeney wrote to NULIS, copied to AFCA, asserting that he was entitled to an annual pension from the Provident Fund which had not been paid. 12 AFCA treated Mr Sweeney's communication to NULIS as a complaint made to it. It notified NULIS to that effect on 14 May 2021. 13 On 20 May 2021, NULIS wrote to AFCA asking AFCA to exclude Mr Sweeney's complaint on six alternative grounds. One of those grounds was that: "We are not the correct financial firm, as Mr Sweeney is not, and never has been a member or beneficiary of a fund of which NULIS is the trustee". 14 On 9 July 2021, an AFCA case manager wrote to Mr Sweeney requesting information relating to Mr Sweeney's superannuation fund membership. Mr Sweeney responded to AFCA's letter but did not provide the information that it sought. 15 On 6 September 2021, the AFCA case manager wrote to Mr Sweeney to the effect that AFCA was not able to consider his complaint because NULIS had no record that Mr Sweeney was a current or former member of the MLC Super Fund, and Mr Sweeney did not provide any information to confirm his membership. Mr Sweeney disagreed with that assessment. 16 NULIS was invited to and did provide a further response to AFCA on 21 September 2021. 17 On 8 October 2021, AFCA wrote to Mr Sweeney confirming its position that it could not consider his complaint because there was "no information to substantiate your claim of a membership with Nulis Nominees". 18 Mr Sweeney made further representations to AFCA about his complaint. On 16 November 2021, AFCA wrote to Mr Sweeney again confirming its position that his complaint was "not within our jurisdiction" and that "no determination has been made" of the complaint. 19 Mr Sweeney filed a "Notice of appeal from Tribunal" in relation to AFCA's Decision on 9 November 2021. The notice of appeal was in Form 75 and purported to contain an appeal under s 1057 of the Corporations Act 2001 (Cth), which provides: "A party to a superannuation complaint may appeal to the Federal Court, on a question of law, from AFCA's determination of the complaint". The notice of appeal set out 11 "questions of law" and sought an order remitting the matter to be determined again by AFCA in accordance with the court's answers to those questions (which he submitted would establish, in effect, that AFCA had jurisdiction to consider his complaint). 20 On 25 February 2022 and 31 March 2022, Mr Sweeney purported to amend the notice of appeal. By those amendments, Mr Sweeney added several other "questions of law" and sought 18 additional or different orders from the order set out in the original notice of appeal. 21 Mr Sweeney also contended that his communication with NULIS copied to AFCA on 10 May 2021 was not a "complaint" to AFCA, and that "at this time the Applicant has yet to lodge a complaint with AFCA related to [his pension claim]". 22 NULIS was joined to the proceeding on 11 February 2022. On 13 April 2022, it filed a notice of objection to competency containing nine grounds of objection, in these terms: Grounds relating to the purported appeal 1. To the extent that the Applicant purports to appeal under section 1057 of the Corporations Act 2001 (Cth), the appeal is incompetent because there has been no 'determination' of any complaint by the First Respondent (AFCA) within the meaning of section 1057(1). 2. The Court otherwise has no appellate jurisdiction in relation to the purported appeal. Grounds relating to other aspects of the Notice of Appeal 3. To the extent that the Applicant purports to seek orders of or in the nature of certiorari or mandamus in relation to AFCA's decision (see orders 1, R1 and R18 in the Amended Notice of Appeal), the application is incompetent because: (a) the application of the Administrative Decisions (Judicial Review) Act 1977 (Cth) is excluded: see Schedule 1, subparagraph (hba) of that Act; (b) section 39B(1) of the Judiciary Act 1903 (Cth) (Judiciary Act) does not apply because AFCA and its employees are not 'officers of the Commonwealth' within the meaning of section 39B(1); and (c) the Court otherwise has no jurisdiction to grant the relief sought. 4. To the extent that the Applicant otherwise purports to invoke the Court's jurisdiction under section 39B(1A)(c) of the Judiciary Act, the application is incompetent for the reasons in paragraphs 5 to 9 below. 5. In relation to the declaration sought in order R5 of the Amended Notice of Appeal, the application is incompetent because: (a) in circumstances where the declaration sought relates to a complaint which has not been lodged, the effect of the application is to seek an advisory opinion about a hypothetical situation; (b) for that reason, there is no real controversy as to a right or duty in question in the proceeding that owes its existence to any law of the Commonwealth or depends upon a law of the Commonwealth for its enforcement; and (c) accordingly, there is no 'matter' in respect of which the Court has jurisdiction to make that declaration under section 39B(1A)(c) of the Judiciary Act. 6. In relation to the declarations sought in orders R7 and R8 of the Amended Notice of Appeal, the application is incompetent because: (a) to the extent the subject matter of those declarations relates to the operation of a law of the Commonwealth (being the provisions of the Superannuation Industry (Supervision) Regulations 1994 (Cth) concerning the transfer of superannuation funds), there is no real controversy as to the operation of that law upon any right or duty; and (b) accordingly, there is no 'matter' in respect of which the Court has jurisdiction to make those declarations under section 39B(1A)(c) of the Judiciary Act. 7. In relation to the declarations sought in orders R4 and R6 of the Amended Notice of Appeal, the application is incompetent because: (a) the subject matter of those declarations is not and does not relate to a right or duty that owes its existence to any law of the Commonwealth or depends upon a law of the Commonwealth for its enforcement; (b) the Court has no accrued jurisdiction in relation to the subject matter of those declarations because: (i) for the reasons in the other grounds set out in this Notice, the Amended Notice of Appeal does not otherwise raise a matter within federal jurisdiction; (ii) alternatively, the subject matter of those declarations is separate and distinct from, or not sufficiently connected with, any subject matter raised by the Amended Notice of Appeal that does fall within federal jurisdiction; (iii) alternatively, the assertion of any subject matter in the Amended Notice of Appeal that falls within federal jurisdiction is colourable; (c) accordingly, there is no 'matter' in respect of which the Court has jurisdiction to make those declarations under section 39B(1A)(c) of the Judiciary Act. 8. In relation to orders R9 to R17 of the Amended Notice of Appeal, the application is incompetent because the Applicant has not identified any source of power to make those orders. 9. The Amended Notice of Appeal does not otherwise identify a real controversy as to a right or duty that owes its existence to any law of the Commonwealth or depends upon a law of the Commonwealth for its enforcement. 23 NULIS also filed detailed written submissions in support of the notice. 24 AFCA also filed a notice of objection to competency, dated 26 April 2022, in which it advanced grounds 1 and 2 only. 25 The hearing of the notices took place on 29 November 2022. Ms D Hogan-Doran SC appeared with Mr D Fuller for NULIS. Ms F Shand appeared for AFCA. As I said earlier, Mr Sweeney was self-represented. 26 Ms Hogan-Doran made detailed oral submissions in support of the notice. AFCA adopted them. 27 Those submissions, like counsel's written submissions, were prepared in circumstances where the applicant was self-represented. His case was put at its highest - and it is fair to say, then comprehensively demolished. 28 It is not necessary to record in these reasons more than appears in the notice of contention, because when it came to be his turn to make submissions, Mr Sweeney effectively disavowed the entirety of his case, save for the submission that despite everything, he had actually not in fact made a "complaint" in the first place. 29 That submission was untenable, as the most cursory glance at the correspondence showed. 30 The correspondence which was said to have initiated the complaint was an email from Mr Sweeney dated 11 May 2021 to Beth McConnell. It relevantly said: I am again writing to you in your capacity as a non-executive director of NULIS Nominees (Australia) Ltd as well as in your capacity as an Industry Panel Member of AFCA. I have therefore copied David Locke. Given the sale of the MLC Super Fund to IOOF Holdings Ltd I have also copied Renato Mota. I shall also be providing other evidence that I have obtained from the Attorney-General's Department of South Australia and the South Australian Parliament available to David Locke and Renato Mota. 31 The email attached a letter of the same date addressed to Ms McConnell, again describing her as "NULIS Nominees Non-Executive Director" and "Industry Panel Member AFCA", with the subject line "Re: Claim for a Life Pension". The letter said "I am again writing to you in your capacity as a non-executive director of NULIS Nominees (Aust) Ltd {NULIS} as well as in your capacity as an Industry Panel Member of AFCA. Please find attached my claim for a life pension based on documents provided by the Attorney-General's Department of South Australia and the Parliament of South Australia". The final page of that letter included the line "Cc David Locke - AFCA Chief Ombudsman and CEO". The email also attached a letter dated 10 May 2021 addressed to the directors of NULIS and the CEO and Managing Director of National Australia Bank, headed "Re: Claim for a Superannuation Pension". 32 AFCA then sent an automatically generated email to Mr Sweeney, an undated copy of which was tendered. After identifying Mr Sweeney as the "complainant", it read relevantly as follows: This email confirms that we have registered your complaint against Nulis Nominees (Australia) Limited. Your case number is 802433. What happens next? We have sent details of the complaint to Nulis Nominees (Australia) Limited and asked them to respond to you (and us) by 08 Aug 2021. This timeframe is based on when you first made your complaint to Nulis Nominees (Australia) Limited and whether you received a final response in writing. If a representative of Nulis Nominees (Australia) Limited contacts you to try to resolve the complaint, we encourage you to participate in the discussion. Many complaints are resolved quickly this way. … You may like to start gathering information about your complaint and send it to us now. If your complaint remains unresolved, and we can consider it, the type of complaints we look at are detailed here www.afca.org.au/make-a-complaint. We will contact you again We will contact you again when we receive Nulis Nominees (Australia) Limited's response. At this stage Nulis Nominees (Australia) Limited may ask us to assess whether the complaint falls within our Rules. Our Rules define the types of complaints we can consider. If we are unable to consider your complaint because it falls outside our Rules, we will contact you and explain why. 33 The email said that "[b]y lodging this complaint", AFCA had deemed the complainant to have granted AFCA authority over certain information, and also provided information about what to do if the "complaint" was about credit, finance, loan, or debt, and how AFCA considered "complaints". 34 An automatically generated email was also sent to NULIS, again identifying Mr Sweeney as the complainant, and referring to the matter as a "complaint" throughout. 35 Further correspondence from AFCA and NULIS throughout 2021 (see [12]-[18] above) similarly referred to the matter as a "complaint" and to Mr Sweeney as the "complainant". 36 During the hearing, Ms Hogan-Doran also referred to AFCA's "Complaint Resolution Scheme Rules" dated 13 January 2021, which "set out the rules and processes that apply to all complaints submitted to the AFCA scheme, including superannuation complaints". Relevantly, under the heading "How a complaint may be submitted to AFCA", rule A.3.1 provides that "[a] person may submit a complaint by using AFCA's online form, writing to AFCA or by contacting AFCA by telephone". And as Ms Hogan-Doran put it: He says he never made … such a complaint, notwithstanding that he is communicating with AFCA for some months in terms of the word complaint and referring to the document that is annexed to Mr Farquhar's affidavit, which is the initiating communication, all of which is in writing and is all that is needed for the purposes of [rule A.3.1] … and, plainly, we would say it is a complaint. It's copied to AFCA. … But, the initial communication to NULIS, the cc addressee on the email is AFCA. So it submits that a series of concerns and assertions and allegations which can be properly described and are described as a complaint are brought to [AFCA's] attention through that email submission. 37 As Ms Hogan-Doran submitted, it is plain that Mr Sweeney's initial 10 May 2021 correspondence was a complaint that fell within the scope of AFCA's rules, and the consequence of Mr Sweeney now saying that he never made any complaint at all is that the proceeding should be dismissed. I accepted that submission and dismissed the proceeding. 38 As to costs, AFCA did not seek any order with respect to the payment of its costs. At the conclusion of the hearing on 29 November 2022, I directed that: (1) By 4pm on 6 December 2022, the applicant file and serve a written submission not exceeding three pages with respect to whether he should pay the second respondent's costs of the proceeding. (2) By 4pm on 13 December 2022, the second respondent file and serve a written submission in response not exceeding three pages. 39 Those directions were complied with. 40 Costs are in the court's discretion, and the default position where an order is made in favour of a party, including on an interlocutory application, is that costs follow the event. See Federal Court of Australia Act 1976 (Cth) s 43; Federal Court Rules 2011 (Cth) r 40.04(a). As the Full Court (Collier, Logan and Charlesworth JJ) said in Knowles v Secretary, Department of Defence (2021) 287 FCR 348 at 362 [76], citing Oshlack v Richmond River Council (1998) 193 CLR 72 at 96 (McHugh J), "that discretion is not expressly constrained. But the power must be exercised judicially. And the usual way in which that discretion is so exercised in relation to costs is by an order that costs follow the event". Here, the "event" was the dismissal of the proceeding, which was the order that NULIS had sought. 41 Mr Sweeney's submissions on costs were, with respect, both variously difficult to understand and irrelevant to the question of the exercise of that discretion. 42 Consistently with the very fair approach adopted by counsel for NULIS at the hearing, in their written submissions, counsel in effect construed Mr Sweeney's submissions to raise three possible matters that may be regarded as bearing on the exercise of the court's costs discretion. 43 First, Mr Sweeney said that his application involved a "simple question" which "should have been resolved at the first Case Management Hearing". 44 But as NULIS submitted, there was nothing in that point because shortly after NULIS was joined, Mr Sweeney had added a range of other grounds and orders sought to his application, which he maintained up to the date of the hearing. A large part of the complexity and cost of the proceeding arose from dealing with those other grounds and orders. 45 Secondly, Mr Sweeney said that AFCA was responsible for NULIS's joinder to the proceeding, not him. But again, as NULIS pointed out, the facts of the matter included that: (1) Mr Sweeney agreed at the first case management hearing that it would be "appropriate" to join NULIS; (2) he did not seek at any time to have NULIS removed as a party to the proceeding; and (3) in any event, having been joined to the proceeding, NULIS was entitled to defend it. 46 Thirdly, Mr Sweeney said that the case involved complex matters and that it would accord with model litigant obligations for all parties to bear their own costs. 47 But, again as NULIS submitted, the complexity of the matter was the consequence of the way in which Mr Sweeney chose to formulate his application, and even conceding for the sake of these submissions that NULIS is obliged to conduct itself as a "model litigant", the obligations that go with such a role are not relevant here. 48 I should however note what I said to Mr Sweeney at the hearing in relation to the conduct of NULIS and its counsel, which was and has remained consistent with the role of model litigants: HIS HONOUR: So tell me this, Mr Sweeney: what do you say about Ms Hogan-Doran's submission that I should dismiss the proceeding and order that you pay the respondents' costs of it? MR SWEENEY: Well, it goes back to the fact that the first respondent has a duty to act as a model litigant, and that - HIS HONOUR: Well, I have to tell you, Mr Sweeney, that if ever there were a model litigant, you have seen it in action today. The second respondent, and by adoption, the first respondent, you need to understand, have gone out of their way to elevate each of the claims you made to anything that they possibly - they could conceivably be, viewing the world most favourably to yourself, and then having erected that construct, creating a case that's the most favourable that could be put in your favour. Ms Hogan-Doran and her junior, in writing and, today, orally, have gone through each of those constructed grounds and explained in detail why none of them could possibly be valid, and why, therefore, the proceeding should be dismissed. 49 NULIS also made the following submissions in support of a costs order in its favour, each of which was properly made. 50 First, NULIS was joined to the proceeding compulsorily, not by its choice. 51 Secondly, in circumstances where AFCA did not make substantive submissions or otherwise take an active role in the hearing of the notices of objection to competency, and the applicant was self-represented, NULIS took on the responsibility of assisting the court and, in effect, carried the burden of running the case. 52 Thirdly, Mr Sweeney filed 21 affidavits - of which the majority were filed without leave - as well as several written submissions, each of which NULIS was required to review at substantial cost. 53 Fourthly, Mr Sweeney essentially abandoned his application on the day of the hearing. 54 The court has power to award lump sum costs "to avoid the expense, delay and aggravation involved in protracted litigation arising out of taxation", and this court's preference is, wherever it is practicable and otherwise appropriate to do so, to make a lump sum costs order. See Beach Petroleum NL v Johnson (No 2) (1995) 57 FCR 119 at 120 (von Doussa J); Costs Practice Note (GPN-COSTS) at [4.1]. 55 NULIS submitted, and I agree for the reasons that it submitted and which I have set out above, that this is an appropriate case for the following orders to be made: (1) The applicant pay the second respondent's costs of the proceeding. (2) A Registrar assess the second respondent's costs through a lump sum costs procedure. (3) The second respondent file and serve its affidavit in support, not exceeding 5 pages (omitting formal parts), by 10 February 2022. (4) The applicant file and serve his affidavit in response, not exceeding 5 pages (omitting formal parts), by 3 March 2022. (5) The lump sum costs procedure be listed before a Registrar for hearing not before 10 March 2022. I certify that the preceding fifty-five (55) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice O'Callaghan.