FEDERAL COURT OF AUSTRALIA

Piepkorn v Caroma Industries Ltd [2000] FCA 1230

HENRIETTE PIEPKORN v CAROMA INDUSTRIES LTD

S23 of 2000

WILCOX, MOORE and KIEFEL JJ

ADELAIDE

28 AUGUST 2000

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

THE COURT ORDERS THAT:

1.                  The appeal be dismissed.

2.                  The appellant, Henriette Piepkorn, pay the costs of the respondent, Caroma Industries Ltd.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

EXTEMPORE REASONS FOR JUDGMENT

1                     WILCOX J:  The Court is in a position to give judgment immediately.  We received the written submissions before today.  We have read them and had the opportunity of considering them; that is the written submissions put in by both parties.  In her written submissions Ms Piepkorn set out the points she wished to make.  She expanded upon them today.  So we are able to deal with the matter, feeling we fully understand what is being said.

2                     The matter before the court is an appeal brought by Henriette Piepkorn against a decision of Mansfield J given on 13 March 2000.  His Honour dealt with a petition for a sequestration order filed in the bankruptcy jurisdiction of the Court.  The debt the subject of the petition was for the sum of $2,598.17 plus interest.  This debt was said to have arisen as a result of an order for costs made by Master Berry in the District Court of South Australia. 

3                     It was common ground before Mansfield J that the debt had not been paid.  However, Ms Piepkorn submitted to Mansfield J that the money was not owing because the District Court lacked jurisdiction to make the costs order.  Mansfield J dealt with that contention on two bases.  First, his Honour concluded that the claim that had been brought in the District Court - which was brought by Ms Piepkorn herself – against Caroma Industries Ltd, the petitioning creditor and respondent to this appeal, was within the jurisdiction of the District Court.  Apparently the claim was for breach of contract and there is no doubt the District Court has jurisdiction to determine breach of contract claims.  Second, after examining the reasons for judgment of Master Berry, Mansfield J said the District Court had not rejected the claim because of any problem of jurisdiction, but because Master Berry held the claim brought by Ms Piepkorn was misconceived and no reasonable cause of action was disclosed by her statement of claim.

4                     Ms Piepkorn did not appeal against the judgment of Master Berry.  It is important to emphasise that it is not our task to determine whether or not the master's view was correct.  We have to take that view as correct, it being the judgment of the District Court and not subjected to any challenge on appeal. 

5                     Master Berry took the usual course of making the costs of the proceeding in the District Court follow the event.  Having dismissed the claim itself, he made a costs order against Ms Piepkorn.  As I have said, that costs order gives rise to the present claim.

6                     Ms Piepkorn put two arguments to us in support of her appeal.  The first argument is a repetition of the argument put to Mansfield J, namely that the District Court had no jurisdiction to make the costs order against her.  During the course of submissions, we discussed this contention with Ms Piepkorn.  I do not wish to add to the observations made by members of the Court during the course of that discussion.  I agree with what Mansfield J said in respect of this matter.  It seems to me clear beyond argument that the District Court had jurisdiction to entertain the claim that Ms Piepkorn brought, it being a contract claim.  It is equally clear that the District Court had jurisdiction to make a costs order, having reached the conclusion that the proceeding ought to be dismissed. 

7                     As I have said, we are not concerned with the correctness or otherwise of Master Berry’s decision to dismiss the proceeding.  The only question we have to consider is whether the District Court had jurisdiction to make the costs order.  It seems to me there can be no question whatever about that.  The debt upon which the petition is based was made within jurisdiction.  As it is conceded the debt has not been paid, it seems to me that this disposes of the argument that was put to Mansfield J.

8                     However, a second submission was put to us in support of the appeal, namely that Mansfield J was prejudiced.  I have experienced some difficulty in understanding the basis of the claimed prejudice.  At one stage in her address to us, Ms Piepkorn referred to something that had happened in an earlier proceeding, apparently a couple of years ago, in which Mansfield J was the judge.  However, when it was pointed out to Ms Piepkorn that it would be impossible for us to consider that matter without reference to the transcript, Ms Piepkorn said she was not claiming this was a ground of prejudice or that his Honour should not have entertained the more recent bankruptcy case because of whatever had happened on the earlier occasion. 

9                     Ms Piepkorn told us she did not make any application to Mansfield J to disqualify himself from hearing the recent case.  I can understand she might have had some reluctance to ask the judge to disqualify himself; although she ought not to feel that there is a problem about making such an application.  It is made from time to time by or on behalf of parties.  However, Ms Piepkorn explained her failure to apply by saying she did not feel there was a basis for disqualification until the judge gave his decision.  It seems that, fundamentally, the prejudice point is that the judge did not accept Ms Piepkorn’s argument that the District Court lacked jurisdiction. 

10                  There can be no prejudice, within the meaning of that term as used in the cases about disqualification, simply because the judge gives a decision that disappoints a party.  It is inevitable that judges give decisions that disappoint at least one of the parties.  A judge may even be wrong in giving that decision, but none of this means the judge is prejudiced.

11                  I see no reason whatever to attribute prejudice to Mansfield J.  His Honour gave reasons for judgment, which extended over several pages, in which he set out in some detail his reasoning process.  None of that reasoning, I think, is open to criticism.  I see nothing in the way the case was conducted that could possibly lead a bystander to feel the judge had some prejudice against Ms Piepkorn. 

12                  I understand Ms Piepkorn’s disappointment.  I say nothing about the merits of any claim that she may have against the present respondent or anybody else.  Those are matters for her to consider, and possibly matters about which it would be wise for her to obtain some legal advice; but they are not matters for the Court in this appeal.

13                  It seems to me that neither of the grounds of appeal is made out and that the Court must dismiss the appeal.  It is unfortunate, but I think inevitable, that the appeal will need to be dismissed with an order for costs against the appellant.

14                  MOORE J:   Generally, for the reasons given by the presiding judge, I agree that the appeal should be dismissed with costs.

15                  KIEFEL J:   I also agree, and have nothing to add.

16                  WILCOX J:   The order of the Court will be that the appeal is dismissed and the appellant pay the respondent's costs of appeal.

Associate:

Dated:              28 August 2000