FEDERAL COURT OF AUSTRALIA
Joossé v Commissioner of Taxation [2007] FCA 445
WOLTER JOOSSÉ -v- DEPUTY COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA
VID 552 of 2005
RYAN J
28 MARCH 2007
MELBOURNE
|
IN THE FEDERAL COURT OF AUSTRALIA |
|
|
VICTORIADISTRICT REGISTRY |
VID 552 of 2005 |
On appeal from the Federal Magistrates Court of Australia
|
BETWEEN: |
WOLTER JOOSSÉ Appellant
|
|
AND: |
DEPUTY COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent
|
|
JUDGE: |
RYAN J |
|
DATE OF ORDER: |
28 MARCH 2007 |
|
WHERE MADE: |
MELBOURNE |
THE COURT ORDERS THAT:
1. The appeal be dismissed.
2. The respondent’s costs of the appeal be taxed and paid or allowed as part of the petitioning creditor’s costs in the bankruptcy.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
|
IN THE FEDERAL COURT OF AUSTRALIA |
|
|
VICTORIADISTRICT REGISTRY |
VID 552 of 2005 |
On appeal from the Federal Magistrates Court of Australia
|
BETWEEN: |
WOLTER JOOSSÉ Appellant
|
|
AND: |
DEPUTY COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent
|
|
JUDGE: |
RYAN J |
|
DATE: |
28 MARCH 2007 |
|
PLACE: |
MELBOURNE |
REASONS FOR JUDGMENT
Introduction
1 This is an appeal from orders of the Federal Magistrates Court constituted by Hartnett FM on 13 May 2005. On that day her Honour made a sequestration order against the estate of the applicant and noted the date of the act of bankruptcy as 23 September 2003. In the course of her reasons for making the sequestration order, the learned Federal Magistrate noted that the creditor’s petition had been founded on a judgment debt of $249,637.94 resulting from an order made by default in the County Court of Victoria on 2 August 2001 for payment of $200,019.43 plus interest. The act of bankruptcy was non-compliance with a bankruptcy notice deemed to have been served on 29 August 2003.
Background
2 The events that preceded the present appeal are conveniently summarised by Hartnett FM at [4]–[14] of her reasons in Deputy Commissioner of Taxation v Joossé [2005] FMCA 507. There, her Honour stated:
‘4. The bankruptcy petition is founded upon a judgment debt being a default judgment entered in the County Court of Victoria on 2 August 2001. An application to set aside the defaultjudgment was heard on 5 November 2001 in the County Court with such application being dismissed by Holt J.
5. The respondent was refused leave to appeal (from the County Court judgment) by the Victorian Court of Appeal. The Court of Appeal considered affidavit material not previously before the County Court and thereafter concluded that the respondent had no arguable defence to the claim which gave rise to the judgment debt. I note that as part of the history in this matter as this court may go behind a judgment debt to ascertain whether there is a debt in truth and reality if there is substantial reason for doing so. (Wren v Mahony (1972) 126 CLR 212). The respondent then sought leave to appeal to the High Court. On 14 February 2003 the High Count dismissed the application for special leave.
6. The bankruptcy notice was issued on 19 March 2003. The respondent sought to argue before Gray J in the Federal Court of Australia and on his application to set aside the bankruptcy notice that there were substantial reasons for going behind the judgment debt. Justice Gray concluded in decision of 29 October 2003 that no substantial reason was advanced by the respondent as to why the Court should go behind the judgment debt.
7. The judgment debt arose from the respondent's personal liability as a director of a company known as Bellhop Pty Ltd (Bellhop) for the estimated amount of unremitted group tax under the provisions of Divisions 8 and 9 of part VI of the Income Tax Assessment Act 1936 (Cth) (the ITAA). Bellhop as an employer was required to deduct amounts in the nature of income tax instalment deductions from the salaries and wages that it paid to its employees. It was also required to remit the deducted amounts to the Commissioner by the due date. In the currency of these proceedings, the respondent asserted that Bellhop had never been an employer and submitted that this is an assertion that he has made numerous times in numerous proceedings. The matter has been litigated and determined and should not, as a matter of discretion, be re-litigated by the respondent (Makhoul v Barnes (1995) 60 FCR 572 at 582). I refer to the following:
a) in the judgment of Marshall J of the Federal Court of Australia (which has not been overturned on appeal) in the matter of Textile Clothing and Footwear Union of Australia v Bellhop [1999] FCA 1095 the Court ordered on 23 July 1999 that a penalty of $2,500 be imposed on Bellhop in respect of breaches for non-observances of Clause 50 of the Textile Industry Award (1994). The declaration which preceded that imposition of penalty was one wherein the court declared that Bellhop had committed breaches or non-observances of Clause 50 of the Textile Industry Award (1994) by failing to make contributions to the Australia Retirement Fund in respect of each of the persons named in the schedule attached to the orders for the periods referred to therein. In his reasons for judgment, Marshall J found that each of the persons referred to in paragraphs 3 and 4 of the judgment had been continuously employed by Bellhop or other companies, the relevant business of which had been transmitted or assigned to Bellhop. In paragraphs 12 and 13 of those reasons, his Honour set out the 10 employees of the first respondent (Bellhop) and the periods for which they were so employed;
b) in his judgment of 29 October 2003 Gray J said, at page 13, paragraph 41:
The combination of facts in the evidence before me suggests that the applicant would have no chance at all of succeeding in relation to a defence that Bellhop Pty Ltd had no employees in the relevant period and for that reason the penalties could not have been imposed.
8. If the Commissioner had reason to suspect that an employer had made deductions but not remitted them by the due date, the Commissioner was empowered pursuant to section 222AGA of the ITAA to make an estimate of the amount of the deductions and was required to advise the employer of the amount of the estimate by a notice pursuant to section 222AGB of the ITAA. Notices of estimate were sent to Bellhop.
9. Division 9 of the ITAA provided relevantly that the directors of a company must within 14 days after the day in which notice of the estimates was sent to the company, cause the company to pay the amount of the estimates or cause it to "begin to be wound up"within the meaning of the Corporations Law in force at the time (hereafter referred to as the Corporations Law). Section 222APC of the ITAA provided that if the estimates were not paid or the directors did not cause the company to be placed into liquidation within the 14-day period, the directors were liable to pay to the Commissioner, by way of penalty, an amount equal to the unpaid amount of the estimates.
10. As a director of a company that was sent notices of estimate, the respondent was personally obliged to ensure, within 14 days of the dates when the notices were sent, that Bellhop:
a) paid to the Commissioner the amount of the estimates; or
b) entered into an agreement with the Commissioner to pay the amount of the estimates by instalments; or
c) was put into administration; or
d) had commenced to be wound up.
The applicant maintains that the respondent did not ensure that Bellhop did any of those four things within the 14 days. Accordingly the respondent became liable at the end of the 14 day period to pay penalties equal to the amount of the unpaid estimates.
11. However, the Commissioner was not entitled to recover the director penalties until 14 days after the Commissioner had given the respondent a notice stating inter alia that the penalty would be remitted if, at the end of 14 days after the notice was given, one of the four things referred to in the preceding paragraph had been done (section 222APE of the ITAA).
12. Director penalty notices under section 222APE of the ITAA in respect of different components of the debt were given to the respondent on 15 June 1999, 15 September 1999 and 16 October 1999. Two notices in respect of the bulk of the debt were given to the respondent on 16 October 1999. Accordingly, for the bulk of the penalty to be remitted, the winding up of Bellhop had to have commenced by 30 October 1999 or one of the other things referred to in section 222APE needed to have been done by that date. This was an issue before Gray J in Joossé v Deputy Commissioner of Taxation of the Commonwealth of Australia[2003] FCA 1325; that is whether Bellhop commenced to be wound up within 14 days of the day on which two of the statutory notices were given. However, the issue in that case turned solely upon the date of service of the two notices. It is also implicit in the reasons of Gray J and as found by the Full Court of the Federal Court in Joossé v Deputy Commissioner of Taxation [2004] FCAFC 245 per Jacobson J at [16] that the winding up of Bellhop began on 3 November 1999.
13. In the hearing of the creditor's petition before the Chief Federal Magistrate (as she then was) the respondent swore for the first time in proceedings that the directors had resolved on 10 September 1999 to place Bellhop into voluntary liquidation. A photocopy of a purported resolution was exhibited to the affidavit of the respondent. This evidence was not put before Gray J or the Court of Appeal of the Supreme Court.
14. If Bellhop had been wound up voluntarily under Part 5.5 of theCorporations Law pursuant to a valid special resolution passed on 10 September 1999, the winding up of Bellhop would have commenced on that date. If the winding up had commenced on that date, the director penalty notices given on 16October 1999 would have been complied with within 14 days, or rather before they were given, and the bulk of the penalty would have been remitted. However, the applicant submits in the proceedings before me that Bellhop was not wound up voluntarily under Part 5.5 of the Corporations Law pursuant to a valid special resolution passed on 10 September 1999. Rather the applicant submits that Bellhop was wound up in insolvency under Part 5.4 of the Corporations Lawpursuant to the order made in the Supreme Court on 3 November 1999, such that the winding upof Bellhop commenced on 3 November 1999 being the date of the winding up order.’
Federal Magistrate’s decision
3 After stating at [32] that she had considered all the evidence as a whole, Hartnett FM said that she was not satisfied that a special resolution had been passed on 10 September 1999. Her Honour also determined that it was clear from the evidence that Bellhop had continued to carry on its business until the end of October, shortly before the Supreme Court appointed a liquidator on 3 November 1999. Her Honour concluded that a sequestration order should be made in respect of the appellant’s estate.
Grounds of Appeal
4 The appellant filed on 19 November 2005 an amended notice of appeal which recited, amongst other things;
‘2. Grounds:
a) that Her Honour has failed to follow the directions of the Full Court, Federal Court when refusing to go behind the judgment that had led to the bankruptcy after the Full Court had already held [at 1] that Bryant FCM had erred in law when failing to do so after reasonable doubt had been cast that no debt could exist in truth and reality and that this denial seeking full disclosure constituted in effect an issue estoppel and failure to investigate the alleged debt and also denied the respondent (Joossé) the right to a full and proper defence in the attainment of natural justice.’
‘b) That Her Honour had showed prejudice and bias
Particulars:
(i) by ordering the respondent (Joossé) to lead with evidence rather than requiring the applicant (DCT) to prove its case, and then by denying the respondent (Joossé) any right of reply to the applicant evidence
(ii) by attempting to reverse the untenable position of the applicant (DCT) which had been created by virtue of ss. 513A and 500 of the Corporations Law back on to the respondent (Joossé) and have him prove that the creditor’s debt did not exist in truth and reality without granting him full disclosure, or full defence
(iii) by requesting the respondent (Joossé) to produce material to be relied on without having given him prior notice,
(iv) by allowing for only 3 working days to attempt and bring the required witnesses to court denying the respondent (Joossé) time to summon the witnesses of the applicant (DCT),
(v) by wrongly assuming [at 31 of the judgment] and without investigating ASIC records that Apsley Productions Pty Ltd was another “Joossé” company or a company that continued the business of Bellhop as a “Joossé” related company
(vi) by wrongly assuming and without evidence to support such notion [at 31 of the judgment] that any purchases made by Apsley Productions Pty Ltd were related and consistent with ‘a resolution being passed on 10 November 1999’
(vii) by already predicting at the preceding directions hearing that the application would be granted,
(viii) by wrongly assuming [at 30 of the judgment] and without evidence to support such notion that Mrs Joossé, who was knowingly not a director, should be able to give evidence in regards to the affidavit of Trudy Shepherd or should have any knowledge at all about the affairs of Bellhop
(ix) by wrongly assuming [at 21 of the judgment] that “it was quite clear that the date on the special resolution had been altered” when no such assumption was made in the judgment of North or Finkelstein JJ
(x) by wrongly assuming and without evidence to support such notion the implied suggestion that the wording “recent unfounded allegations and demands made upon the company and director(s)” were related to any demands made by the applicant (DCT)
(xi) by wrongly assuming and without evidence to support such notion [at 20 of the judgment] that the resolution had not been sent to ASIC when sworn evidence was before the court that it had been sent and the sending had at all times been in accordance to the law
(xii) by wrongly assuming against sworn evidence that the resolution had not been passed on 10 September 1999
when ignoring the fact that witnesses had re-affirmed whilst under oath their original sworn affidavit supporting the date of the passing of the resolution, Fitzgerald at 5-10 p.43 following cross examination by counsel for the applicant (DCT) and Sheehy at 10-15 p.46 in reply to Hartnett FM and again at 25-30 p.50 of transcript after cross-examination and Mrs Joossé at 5-10 p.37 in reply to Hartnett FM
c) that the Court dispensed with, or suspended the laws of the Commonwealth
Particulars:
(i) When sitting in its own judgment following the decision by Bryant FCM to grant a sequestration order and having thereby already caused injury to the good name and reputation of the respondent (Joossé) and therefore having a vested interest in the outcome of the proceeding
(ii) by failing to be bound by cl. 5 of the Constitution Act 1900 in so far that the laws of the Commonwealth are binding on all the courts and judges
(iii) by failing to be bound by ss. 500 (1) and (2) and 513B(e) of the Corporations Act 1989 (as it was then), ss.222APB (1)(d) and (2)(d), 222APE (1)(b)(iv), 222AOE(b)(iv) and (d)(iv), 222APF(b) and 222AOG (2) of the Income Tax Administration Act 1936 and s. 28A (1)(b) and 29 (1) of the Acts Interpretation Act 1901 and others
(iv) by failing to observe the Coronation Oaths Act 1688 and follow the common law principles and customs which are distinctly different from statute law practices and rules of the court in matters of bankruptcy,
(v) by failing in the exercise of its responsibility as a court sitting in bankruptcy and fully investigate and prove beyond any doubt at all that a real debt actually existed in truth and reality,
(vi) by failing to investigate the indictable offences raised by the respondent (Joossé) under ss. 15D, 28, 34(b), 36, 39, 43, 44, 86(a)(b)(c)(d) of the Crimes Act 1914 (Cth) as amended from time to time, or consider the effects that s. 5 of same Act would have on the court’s own position following failure to act or to investigate and which offences had perverted the course of justice and could have effected the decision of Hartnett FM and now give good cause to claims of misprision.’
6 I shall discuss these issues in the order that they have been raised by the appellant in his amended notice of appeal.
(a) Did her Honour err in refusing to go behind the default judgment?
7 The appellant submitted that Hartnett FM had erred in declining to go behind the default judgment when there was an obligation to do so as a Full Court of this Court in Joossé v Deputy Commissioner of Taxation (2004) 37 FCR 576had held that sufficient doubt existed to require the debt to be investigated and that Bryant FCM had erred by failing to carry out the investigation.
8 In the course of the reasons of the Full Court, their Honours stated that, in order for the Court to go behind the default judgment it was only necessary for the appellant to show that there is “substantial reason for questioning whether there is a debt”. At [7] North and Finkelstein JJ observed;
‘Subject to one qualification, there was such evidence before the Chief Magistrate. The appellant had tendered a copy of a letter dated 14 September 1999 which he said he had written to his accountant. In the letter the appellant states that the company had “[commenced] winding up” on 10 September 1999. If this letter was indeed written on the date that it bears, that would be sufficient to require the bankruptcy court to investigate the appellant’s claim. The qualification is whether the applicant actually wrote the letter on 14 September 1999. The letter bears what is commonly referred to as a “date received” stamp. Unfortunately the stamp is illegible. Had the Chief Magistrate directed herself to the issues that she was required to consider, she would no doubt have asked for the production of the original letter so that she could determine the date received stamp. She may also have required the accountant to verify that it was his stamp and that the letter was not a forgery. In most cases it is for the litigant to decide how to present his case. Here the appellant was self represented and the court would no doubt have given him some latitude in presenting his case.’
‘In our view the sequestration order should be set aside and the matter should be remitted to the Federal Magistrates Court for further investigation. If the appellant is able to establish that his letter is genuine, it will then be necessary for that court to determine the issues that should have been investigated by the Chief Magistrate’.
10 According to the appellant, it followed from those observations that Hartnett FM had fully to investigate the alleged debt and hear afresh the issues concluded by the default judgment after allowing full examination of all relevant facts and law. Instead, the appellant submitted, by exercising her discretion not to go behind the judgment, her Honour had failed to discharge the obligation to satisfy herself that a real debt existed and so committed an error of law.
11 The respondent, on the other hand, submitted that the Full Court in Joossé v DCT had not held that there existed sufficient doubt for the Court to go behind the default judgment. It had held only that evidence of a resolution carried on 10 September 1999 in addition to the letter purportedly dated 14 September 1999 constituted matters that warranted further investigation.
12 At the hearing before Hartnett FM, what was claimed to be the original minute of the resolution of 10 September 1999 was produced for the first time in curial proceedings. Also tendered were copies of a letter from the appellant dated 14 September 1999 to Mr Sheehy, the former accountant for the appellant and his companies. That letter began “It is with regret that we advise you that last Friday 10 September it was resolved to voluntarily withdraw from all business and commence winding up”. Also produced was a copy of a letter dated 20 September 1999 from the appellant to the Australian Securities and Investment Commission (“ASIC”) advising it that, at an extraordinary meeting held at Seaford on 10 September 1999, it had been resolved by the directors and shareholders of Bellhop to withdraw voluntarily from business and wind up the companies.
13 In my view, her Honour investigated this evidence with the intention of going behind the judgment debt if it appeared to establish that a resolution for the voluntary winding up of Bellhop had been carried on 10 September 1999. However, the appellant was unable to provide her Honour with an original or a contemporaneous copy of the letter dated 14 September or a copy on which the “date received stamp” was legible. Nor was her Honour persuaded that Mr Sheehy was a credible witness whose evidence supported the allegation that the letter dated 14 September 1999 had, in fact, been received by him in September 1999; (see her Honour’s reasons at [29]). Her Honour also found that the correspondence from the appellant to ASIC had not been received by ASIC; (see reasons at [25]).
14 Moreover, her Honour considered that the assertion that Bellhop had been wound up on 10 September 1999 was inconsistent with the basis on which the appellant had conducted earlier proceedings (the assertion having been made for the first time in an affidavit opposition to the creditor’s petition heard by Bryant FCM); (see Hartnett FM’s reasons at [18]). It was also inconsistent with evidence that Bellhop had continued to carry on its business until the end of October, shortly before the Supreme Court appointed a liquidator on 3 November 1999 (see Hartnett FM’s reasons at [33]).
15 In my view, her Honour did all that was required of her to investigate the issues identified by the Full Court which, prima facie, cast doubt on the existence of the judgment debt. Ultimately, however, her Honour found that the evidence which the Full Court indicated might be forthcoming did not create the requisite doubt as to the existence of the debt. That was a conclusion open to her Honour on the facts and I cannot, on appeal, disturb her consequential decision not to go behind the judgment.
Makhoul v Barnes
16 The appellant also submitted the learned Federal Magistrate had erred when she said at [7] of her reasons that the matter had been litigated and determined and should not, as a matter of discretion, be re-litigated. She regarded that as consonant with the authority of Makhoul v Barnes(1995) 60 FCR 572 at 582. However, the appellant contended that a court sitting in bankruptcy cannot claim to have fulfilled its obligation at common law without assuring itself of the real existence of the foundational debt.
17 I regard that contention as inconsistent with Makhoul v Barnes 60 FCR 572,where it was pointed out, at 584;
‘It is clear that in not all cases will the Court go behind a judgment debt to see if there is a real consideration. It will do so only where reasons are shown for questioning whether there was really a debt: Boral Johns Perry Industry Pty Ltd v Piccardi (unreported, Full Court, Wilcox, Burchett and Hill JJ, 23 June 1989 at 13). The existence of the judgment will be prima facie evidence of the debt and the Court will not go behind the judgment as a matter of course: In re Flateau; Ex parte Scotch Whisky Distillers Ltd (1888) 22 QBD 83 at 85-6 per Lord Esher MR.’
18 Thus, unless reasons were shown for questioning whether there was a real debt, the learned Federal Magistrate was not required to go behind the judgment debt.
Issue estoppel
19 The appellant submitted that Makhoul v Barnes60 FCR 572 was inapplicable to the present case as no issue estoppel can arise to bind a court sitting in bankruptcy. To hold otherwise, according to the appellant, would impermissibly inhibit a debtor’s ability to cast doubt on the existence of the foundational debt.
20 On the other hand, Counsel for the respondent submitted that Makhoul v Barnes60 FCR 572 was not concerned with issue estoppel. Rather, it was authority for the proposition that where a court has already investigated a question on an application to set aside a bankruptcy notice, it would rarely, if ever, do so again, not because an issue estoppel has been raised, but because the court has already investigated the existence of the debt and it would be inappropriate to revisit the matter.
21 The issue to which the principle in Makhoul v Barnes 60 FCR 572 applied in the present case was whether it had been established in earlier proceedings that the relevant company, Bellhop, had been an employer. Her Honour considered that question to have been clearly answered in the affirmative both by Marshall J in Textile Clothing and Footwear Union of Australia v Bellhop (supra) and Gray J in Joossé v DCT (supra) .
22 In my opinion, Makhoul v Barnes does not exemplify an application of issue estoppel. Nor, did issue estoppel arise in relation to the present controversy, particularly, as it pertained to the appellant’s assertion that no real or genuine debt underlay the default judgment.
Jurisdictional Issues
23 The appellant also submitted that Makhoul v Barnes had the effect that the matter which had been before Bryant FCM could not be “re-heard” by Hartnett FM. His contention was that only an appeal from the judgment of the Full Court or a fresh hearing by a judicial officer going behind the default judgment could properly have followed the judgment of the Full Court.
24 As Counsel for the respondent pointed out, however, the matter had been remitted to the Federal Magistrates Court by order of the Full Court. That remitter was not on terms that the Federal Magistrate assigned to hear it should necessarily go behind the default judgment. The appellant’s attack on Hartnett FM’s exercise of jurisdiction must, therefore, be rejected.
(b) Allegations that Hartnett FM had been guilty of “prejudice and bias”
25 The second ground of appeal particularised in sub-paragraphs (i) to (xiii) set out at [5] above asserts that in those thirteen respects the determination of the learned Federal magistrate was infected by bias.
(i) Appellant required to commence adducing evidence and denied a right to adduce evidence in reply
26 One illustration of what I understand to be contended to give rise to a reasonable apprehension of bias was her Honour’s direction that the appellant (the respondent in the proceedings before her) should begin by adducing his evidence instead of requiring the petitioning creditor to prove an entitlement to a sequestration order.
27 Counsel for the respondent disputed the appellant’s account of the proceedings on the remitter before Hartnett FM. She pointed out that the Appeal Book contains only that part of the transcript recording what took place after the luncheon adjournment. That was said to be evident from the recording of the time on page 214 of the transcript as 2.23 pm, and that at page 215 the appellant is recorded as having said;
‘Your Honour, Ms Riley [Counsel for the petitioning creditor] has given a rundown as to the procedures that have taken place, and has given or suggested that it is unreasonable that we did not file a notice of resolution earlier. As I started to explain to you before...’
28 Those remarks were relied on as bearing out the respondent’s assertion that there had been an earlier part of the hearing in which Counsel for the respondent had presented her opening and the evidence on which the respondent intended to rely so that there had been no requirement for Mr Joossé to go first in adducing evidence.
29 In the absence of evidence from the whole transcript, I prefer the respondent’s version of events but, even if that be wrong, the matter to which he has referred does not support an allegation of apprehended bias. That is because an objective reasonable bystander would conclude, in the light of the condition imposed by the Full Court in the passage quoted at [9] above, that it was entirely reasonable for her Honour to require Mr Joossé to go first in adducing evidence tending to satisfy that condition. The condition, it will be recalled, was expressed in these terms: “If the appellant is able to establish that his letter is genuine ….”
30 I am similarly unconvinced by the appellant’s argument that Hartnett FM erred by denying him a right to adduce evidence in reply to the respondent’s evidence. Counsel for the respondent contended that this allegation was not borne out by the transcript. However, the relevant part of transcript does not form part of the appeal papers and the appellant has made no attempt to demonstrate what evidence in reply he would have adduced had the alleged denial not occurred.
(ii) Requiring the appellant to prove that the creditor’s debt did not exist without affording him “full disclosure” or “full defence”
31 In this slightly different way, the appellant again contended that the Court had been obliged to investigate the debt and that Hartnett FM had erred by failing to afford him an opportunity to provide “full disclosure” or a “full defence”. In particular, he submitted that he should have been allowed, in the proceedings in the Federal Magistrates Court, to seek to discover material going to whether Bellhop had been an employer.
32 This contention was based on the assumption that her Honour was obliged to go behind the judgment debt. That, as I have already explained, is a mistaken assumption. The learned Federal Magistrate was only required to investigate the circumstances surrounding the debt to the extent that they raised the possibility that it did not exist in truth and reality. Once that possibility had been excluded, the obligation ceased. Her Honour noted that the status of Bellhop as an employer had been determined by Marshall J in Textile Clothing and Footwear Union of Australia v Bellhop (supra) and by Gray J in the application to set aside the bankruptcy notice. It follows that there was no obligation for the Federal Magistrates Court to revisit that issue and its refusal to do so could not support an imputation of apprehended bias.
(iii) Magistrate’s direction without prior notice requiring appellant to produce documentary evidence
33 The appellant claimed that, just before the luncheon adjournment of the hearing before Hartnett FM, her Honour instructed him to produce by 2.15pm copies of exhibits which he believed were already on the court file. This direction was said to reveal prejudice or bias as the appellant resided at some distance from the court and was obviously unable to produce the documents within the short time allowed.
34 Counsel for the respondent disputed the appellant’s claims in this respect, pointing out that a notice to produce had been issued some time earlier and that the appellant had, in fact, produced almost all of the requisite documents on the morning of the hearing and had found over the luncheon adjournment another document, being what he claimed was the original minute of the resolution of 10 September 1999.
35 It is unnecessary for me to resolve the factual differences between these versions of events. It should have been apparent to the appellant from the passage from the reasons of the Full Court quoted at [9] above, that he was being given an opportunity to establish, at a rehearing in the Federal Magistrate’s Court, the authenticity of the letter of 14 September 1999 and that a resolution for winding up Bellhop had been carried on 10 September 1999. For the learned Federal Magistrate to have allowed the appellant no longer than the luncheon adjournment to produce any remaining documents on which he wished to rely in relation to that issue was not unreasonable in the circumstances. It certainly did not indicate that she was bringing a closed mind to the issue or was otherwise biased against the appellant.
(iv) Allowing the appellant only three days in which to compel the attendance of the respondent’s witnesses
36 A further manifestation of bias against the appellant was said to be the learned Federal Magistrate’s having allowed him only three days to serve notices requiring the attendance at court of the respondent’s witnesses. Ms Riley of Counsel for the respondent, who had appeared on the hearing below, said that notices to attend for cross-examination had been served on the respondent’s witnesses who had been in attendance and available for cross-examination on the day of the hearing. In the circumstances, I can discern no support in her Honour’s conduct for any imputation of bias against the appellant.
(v) and (vi) Inferences as to winding up of Bellhop drawn from activities of Apsley Productions
39 In the same context, the appellant asserted that a further error was inherent in [31] of the same reasons insofar as it was assumed that any purchases made by Apsley Productions were consistent with “a resolution being passed on 10 November 1999”. Ms Riley’s response to this contention was that it was open on the evidence to find that purchases made by Apsley Productions were related to the business of the earlier company and were consistent with a resolution to wind up the earlier company having been passed on 10 November 1999.
(vii) Predetermination at directions hearing that the application would be granted
41 The appellant also contended that the learned Federal Magistrate had exhibited bias by “deciding” at an earlier directions hearing that the application would be granted. Counsel for the respondent disputed this allegation, saying that no support for it could be found in the transcript of the directions hearing. However, a copy of that transcript has not been included by the appellant in the appeal papers on which he has relied. This allegation must therefore be rejected for lack of evidence. Moreover, it is inconsistent with her Honour’s conduct of the final hearing on 8 March 2005, the transcript of part of which is in evidence. That transcript indicates that her Honour retained, to the end of the hearing, an open mind on the question identified by the Full Court and gave the appellant every opportunity to persuade her to answer it favourably to himself.
(viii) Federal Magistrate’s assumptions as to matters on which Mrs Joossé should have been able to give evidence
‘1. That I was personally present at the office in Seaford on 10 September 1999 when the decision was made to close up the business and witnessed the resolution for voluntary winding up being passed.
2. That I recorded this sad event in my diary and a copy of that entry is hereby attached as Exhibit JYJ-1.’
43 The diary entry for 10 September 1999 exhibited to that affidavit contained, relevantly, only the entry “Business closed” apparently written with a different pen from the only other entry for that date “T. 6 p.m camp pick up.”
44 Under cross-examination, Mrs Joossé acknowledged that, in September 1999, she was neither a shareholder nor director of Bellhop. She did not sign any document as a witness and regarded the signing by Mr Joossé of a document as a formality. No other person was thereand all that was said was “probably … it was a sad day.” Mrs Joossé accepted, under cross-examination, that she was unable to comment on evidence by Ms Shepard of the liquidator’s office who claimed to have found production reports which suggested that Bellhop had continued to manufacture garments into October 1999 but had done no work on Friday, 10 September, 17 September and 24 September 1999.
‘The wife of the respondent gave evidence that she was present at the office in Seaford at a time and place consistent with the evidence given by her husband and being on 10 September 1999 when the decision was made to close up the business and that she witnessed the resolution for voluntary winding up being passed. Only herself and her husband were present. Mrs Joossé was not a director nor shareholder of Bellhop at the time. She described her attendance to view her husband sign a document a formality. There were no notices in relation to any proposal for the winding up of Bellhop nor was there a vote she had to participate in nor any document she had to sign or witness. Her evidence was that she recorded this event in her diary and a copy of that entry was attached to her affidavit and the relevant part of the diary tendered in evidence in court. She could not however explain the evidence of Trudy Shepherd as to the company’s production report nor the evidence that the company did in fact continue working after 10 September 1999. Her claim that the company was wound-up and ceased business on 10 September 1999 is clearly contradicted by Mr Joossé’s own statement to the liquidator in a questionnaire in which he stated that Bellhop ceased trading on 21 October 1999 (as is contained in the affidavit of Stephen Antony Linden sworn 12 December 2003 paragraph 7 and exhibit SAL-5 thereto, being two affidavits of David Ian Johnston, one sworn 6 December 2001 and the second sworn 21 February 2002, and, in particular, exhibit A to the second Johnston affidavit). Mrs Joossé’s evidence is also inconsistent with the chronology of events relating to Bellhop set out in an affidavit sworn by Mr Joossé on 21 February 2002 which is contained in exhibit SAL-6 to the affidavit of Stephen Antony Linden sworn on 12 December 2003. Mr Joossé’s affidavit, titled Third Supplementary Affidavit, and filed in the Court of Appeal proceedings, makes no mention of a voluntary winding up of Bellhop, although in paragraphs 6 to 11 it appears to provide a complete chronology of Bellhop for the period July to November 1999. In paragraph 11, Mr Joossé referred to a voluntary de-registration in 1995 which it is common ground did not go ahead, and a motion for winding up dated 15 September 1999. The company search of Bellhop (at DIJ-28 in SAL-5) does not record any resolution for winding up with that date, but does note under the heading “Petitioner Court Action” the Deputy Commissioner’s petition for winding up (by notice of motion) dated 21 September 1999. Having gone into the degree of detail contained in that affidavit, I accept the submission of Counsel for the applicant that it is inconceivable that Mr Joossé would have failed to mention the voluntary winding up of Bellhop if it had in fact commenced on 10 September 1999. Considering all of the evidence before the Court including the history of proceedings I do not accept her evidence.’
46 In the appellant’s submission, it was inappropriate for Hartnett FM not to have accepted Mrs Joossé’s sworn evidence. As the learned Federal Magistrate had acknowledged that Mrs Joossé was neither a director nor a shareholder of any of the companies and had no involvement in the daily running of them, she should have disregarded Mrs Joossé’s inability to explain Ms Shepard’s evidence based on purported reports of production after 10 September 1999. Likewise, it was said to have been unreasonable for her Honour to have refused to accept as credible Mrs Joossé’s evidence that she was present at the company offices at 6 Apsley Place, Seaford on 10 September 1999 and had witnessed the passing and signing of the resolutions to voluntarily wind up the company because some of the documents prepared by the appellant had failed to mention that the resolution had been passed on 10 September 1999. It was submitted that, although Mrs Joossé had not been present at the company offices on that day specifically to witness the passing and signing of the resolution, there was no evidence to suggest that she was not at the office on that day as she deposed.
(ix) Assumption contrary to the reasons of North and Finkelstein JJ that date on minute of special resolution had been altered
48 The appellant further claimed that Hartnett FM had demonstrated prejudice and bias by wrongly assuming, at [21] of her reasons, that “it was quite clear that the date on the special resolution had been altered”. According to the appellant, no such assumption had been made in the reasons of North and Finkelstein JJ as members of the Full Court on 3 September 2004. The appellant revived in this context the submission that the Full Court had held that the special resolution and letter to the appellant’s accountant concerning the resolution afforded prima facie grounds for investigating afresh the judgment debt, at least once it had been confirmed that they had been brought into existence on 10 and 14 September 1999 respectively.
49 Paragraph [21] of the learned Federal Magistrate’s reasons is in these terms;
‘What the Court is required to consider is whether the members of the company passed a resolution to wind up the company, and if so, on what date? There is before the Court a purported special resolution of Bellhop said to be pursuant to section 492 of the Corporations Law signed by the respondent as secretary/director of the company wherein it is said the company resolved
That in view of recent unfounded allegations and demands made upon the company and its director(s) and in view of the fact that the company has no real purpose and intends not to conduct any business, that the company begins voluntary winding up as from this day.
The resolution is dated, it is alleged by the respondent, 10 September 1999. It is quite clear on the document which has been tendered to the court and is marked exhibit WJ4 that the date has been altered. The date appears to have been altered from 10 November 1999 to 10 September 1999.’
50 Although the copy in the appeal papers of the exhibit, which was labelled “WJ-D” and not “WJ-4” as described by her Honour, is only a photocopy, my lay examination of it bears out the finding that the number “9” signifying September in the date had been altered from “11”. It should also be borne in mind that the document contains no internal indication that it had been brought into existence on 10 September 1999. For these reasons, the finding encapsulated at [21] of the reasons below was open on the evidence and evinces nothing to support an imputation of apprehended bias. The finding therefore cannot be disturbed on appeal.
(x) Assumption that reference in minute of claimed resolution related to demands by the Deputy Commissioner of Taxation
51 It is not clear to me from the reasons of the learned Federal Magistrate that she made any assumption or finding that the reference in the claimed minute of the disputed resolution to “recent unfounded allegations and demands made upon the company and director(s)” was directed, at least in part, to demands by the Deputy Commissioner of Taxation. In any event, it cannot be suggested that any such assumption or finding was regarded as critical to establishing the date of the resolution because the evidence revealed, and her Honour clearly understood, that demands were made by the Deputy Commissioner in relation to Bellhop’s unpaid group tax, both before and after 10 September 1999. This ground, accordingly, does not establish any error of fact or any conduct by her Honour which could found an imputation of apprehended bias.
(xi) Finding or assumption that copy of minute of claimed resolution of 10 September 1999 not sent to ASIC
52 The appellant next contended that Hartnett FM wrongly assumed at [20] of the reasons at first instance that notice of the resolution of 10 September 1999 had not been sent to ASIC although there was no evidence of this other than that it had not been registered in ASIC’s record. The same absence of registration applied to the notice to Bellhop which had indisputably been sent by ASIC on 15 April 1999 advising of ASIC’s intention to deregister the company. Moreover, ASIC’s company extract in relation to Bellhop discloses receipt of a “notification of filing application for winding up order” on 21 September 1999. According to the appellant, the advice which he had sent to ASIC had been dated 20 September 1999 so that the inference was available that the respondent’s “notification of application for winding up order” may have been received by ASIC on 21 September before it received the appellant’s letter dated 20 September. That would explain the appellant’s argument why his letter was not recorded by ASIC; ie, because it was regarded as overtaken by the respondent’s notice of application for winding up by the Court.
53 Similarly, the appellant submitted that, although the respondent relied on the affidavits of Mr Evagorou and Ms Shepard, neither of those witnesses had positively asserted that no resolution to wind up the company had been passed on 10 September 1999. Mr Evagorou had merely said that the appellant had not, during the hearing in the Supreme Court on 3 November 1999, mentioned a resolution for voluntary winding up but had raised only constitutional matters. The appellant acknowledged the truth of that evidence but stated that he had not appeared in the Supreme Court to defend the company, which he thought was already defunct but had been concerned, instead, “to allow the opportunity to raise irregularities in law promoted by the Institute of Taxation Research which funded any such challenges”.
54 The appellant also acknowledged that Ms Shepard had deposed on oath that she had searched “the books in the possession of the liquidator relating to Bellhop and could find no documents indicating or suggesting in any way that Bellhop had begun to wind up voluntarily on 10 September 1999”. That was said by the appellant to be evidence of no more than Ms Shepard’s inability to find the resolution and did not positively negate his evidence that the resolution had been passed on 10 September 1999 and notification of it had been sent to ASIC on 20 September.
55 In response to this contention, Ms Riley pointed out that the learned Federal Magistrate had accepted that there was not, amongst the documents provided by the appellant, to the liquidator of Bellhop, a copy of either letter claimed to have been sent to Mr Sheehy and ASIC. As well, Ms Shepard deposed to the liquidator’s possession of documents tending to show that Bellhop had continued to carry on business after 10 September 1999 and was still trading in October 1999. Those documents were Bellhop’s production reports, delivery dockets, invoices, statements and journal cashbook. Bellhop’s production reports for the period from 7 September 1999 to 14 October 1999 indicated that it had produced garments during that period. The respondent pointed to this evidence as strengthening the doubt created by other, negative, indications that no resolution for the voluntary winding up of Bellhop had been carried on 10 September 1999. One of the negative indications to which the respondent attached particular significance was that the appellant, as late as 3 November 1999, was vigorously opposing the winding up of Bellhop by the Supreme Court.
56 In some respects, the debate in respect of this particular of ground (b) of the notice of appeal was directed to a false issue. The letter claimed to have been sent on 20 September 1999 recorded that;
‘It was resolved by all the director(s) and shareholder(s) of the following companies Bellhop Pty Ltd (ACN 006 964 683) and David Keys Australia Pty Ltd (ACN 006 987 720) at an extra ordinary meeting held at Seaford on 10 September 1999 to voluntary withdraw from business and wind up the companies.’
The letter continued with these paragraphs;
‘As Bellhop Pty Ltd never had any assets, creditors or debtors we are not familiar with the process and procedures but draw your attention to your advices dated 15 April 1999 notifying the intention by ASIC to deregister the companies. It is therefore quite likely that this has already been done.
In any event please find enclosed the appropriate documentation in case the companies have not already been deregistered.’
57 There is no evidence of the preparation or existence of a separate minute recording the resolution to wind up David Keys Australia Pty Ltd. Significantly, neither Mrs Joossé nor Mr Fitzgerald testified to having seen any such document. Nor was there any reference to it in the letter to Mr Sheehy of 14 September 1999. More critically, the letter to ASIC indicates that the writer was “not familiar with the process and procedures” and therefore leaves open the inference that what was sent to ASIC was something other than a contemporaneous minute of a resolution on 10 September 1999 for the voluntary winding up of each of Bellhop and David Keys Australia Pty Ltd. All that her Honour said at [20] of the reasons below by way of a finding directed to this issue was;
‘… The company extract from the Australian Securities and Investments Commission (ASIC) is evidence that the alleged resolution for voluntary winding up was not lodged with ASIC, despite the respondent's claim that he notified ASIC.’
58 In that passage her Honour was doing no more than indicating the evidence which tended one way and the other on whether the letter of 20 September 1999 had been sent to ASIC and, if so, what had been enclosed with it. In the result, Hartnett FM did not find it necessary to resolve those questions which arose for consideration only on the way to determining whether a resolution for the voluntary winding up of Bellhop had been carried and minuted on 10 September 1999. Her Honour was simply unable “when considering the evidence as a whole” to be satisfied on the balance of probabilities that that ultimate question should be answered affirmatively; see [32] of the reasons below. It follows that her Honour’s treatment of this question cannot sustain the appellant’s claim that she could reasonably be apprehended to have been prejudiced or biased.
(xii) and (xiii) Finding against the weight of sworn evidence reaffirmed under cross-examination that claimed resolution not carried on 10 September 1999
59 These complaints by the appellant arose from the rejection by Hartnett FM of evidence by Mr Fitzgerald, Mr Sheehy and Mrs Jacqueline Joossé despite the fact that each of those deponents had attended at the hearing on 8 March 2005 and been cross-examined on his or her affidavit by Counsel for the respondent. It is convenient to consider separately, and in order, the learned Federal Magistrate’s treatment of each of those parts of the appellant’s case.
(a) Mr Fitzgerald
‘1. That Mr Wolter Joosse had come to visit our office during September 1999 to advise in person of a decision to wind up and cease all operations following continuous disputes and conflicts with a trade union and to thank us for our service and support throughout the many years of our association
2. Though we had been aware that the litigation with the union had upset Mr Joosse greatly but the news to close down the business for good nevertheless came as a surprise. Our company had been supplying most of the knitting yarn to David Keys since Mr Joosse's family purchased David Keys in 1989
3. That Mr Joosse had mentioned that his son was thinking of starting a business but only if he could obtain support and asked if we could come down to Seaford to see his son and discuss possible credit terms with him
4. That during the same week I visited David Keys premises at Seaford and spoke with Mr Joosse and his son and during the course of the conversation I asked Mr Joosse if he would not change his mind but he told me that the deed had already been done and showed me a resolution for winding up passed by a company named Bellhop Pty Ltd and dated the previous Friday 10 September
5. That I distinctly remember that name because I had never heard of such company in all the years that we had been trading with Mr Joosse and I was not aware that Mr Joosse was involved in such business and I asked what this company was or did. It was explained to me that Bellhop had been the original David Keys Australia prior to a name change in 1995 but since remained non active.’
61 Under cross-examination by Counsel for the respondent at the hearing on 8 March 2005, Mr Fitzgerald said that his firm had supplied Apsley Productions Pty Ltd with yarn from about December 1999 and had continued to do so for about six months. Also under cross-examination, Mr Fitzgerald testified that his company had supplied or invoiced David Keys Australia Pty Ltd until about July 1999:
‘… and then when we had discussions with Bernard [Mr Joossé’s son] we were told then all future invoicing was to be a company called Apsley Productions … So far as we were concerned, it was the same company set up as such, same employed [sic] we were dealing with, except that it had been Bernard in terms of the knitter and how the business went about. It was simply they rang up and ordered yarn …’
62 Mr Fitzgerald acknowledged that his affidavit had been prepared by Mr Joossé and that, although he believed that it had been in September 1999 that there was “finality” that “he [Joossé] said “Okay, we’re looking at closing up”, that conversation could have occurred in November. He claimed to remember having been shown a “letter” which had been dated and signed but could not remember that it bore the specific date, 10 September. He reiterated that, before December 1999, his company had always invoiced David Keys Australia Pty Ltd and, until his visit to the Seaford premises, he had never heard of Bellhop.
63 Against that background, it is instructive to set out in full that paragraph [31] of the reasons below of which the appellant complains;
‘The evidence of Adam David Fitzgerald did not assist the respondent. Mr Fitzgerald gave evidence that he saw a document that purported to be a resolution for the winding up of Bellhop. He thought he saw it in September 1999 but was not sure. He accepted that he may have seen it two months later, in November 1999. Mr Fitzgerald recalled that the document he saw was dated and signed but could not say that it was dated 10 September 1999. Mr Fitzgerald did not recall seeing an alteration in the date on the document, although it has obviously been altered from 10 November 1999 to 10 September 1999. This suggests that Mr Fitzgerald saw the unaltered document, bearing the date 10 November 1999, in November 1999. Mr Fitzgerald's stated reason for thinking that he might have seen the document in September 1999 was that that date fitted in with the time at which Mr Joosse's company (which he thought to be David Keys Australia Pty Ltd rather than Bellhop) customarily ordered yam for the following season. However, Mr Fitzgerald also gave evidence that another Joosse company, Apsley Productions Pty Ltd, run by Mr Joosse's son Bernard, took over the business of the earlier company and continued to purchase yam from Mr Fitzgerald's company for about the next six months. Mr Fitzgerald first invoiced Apsley Productions in December 1999. I accept the applicant's submission that as there was continuity in Mr Fitzgerald's business relations with Mr Joosse related companies, Mr Fitzgerald's stated reason for thinking he saw the resolution in September 1999 does not provide a firm basis for tying his recollection to September 1999. Moreover, the fact that Mr Fitzgerald's company first invoiced Apsley Productions in December 1999 is consistent with the resolution actually being purportedly passed on 10 November 1999. The weight to be given to the evidence of Mr Fitzgerald's supposed recollection that he saw the purported resolution in September 1999 is reduced by the fact that Mr Joosse drafted Mr Fitzgerald's affidavit for him after asking him to recall any meetings between July and September 1999. Mr Fitzgerald impressed as a witness who endeavoured to present an accurate and truthful recall of events to the court.’
64 An analysis of the chain of reasoning disclosed by that paragraph when read in full makes clear why no exception can be taken to her Honour’s rejection of Mr Fitzgerald’s testimony as supporting a finding that the special resolution to wind up Bellhop had been carried and the minute thereof signed and dated on 10 September 1999. Each part of that evidence, when examined in light of the concessions made in cross-examination, left open the conclusion that the resolution had been taken and minuted well after 10 September or had never come into existence before Bellhop was wound up by the Supreme Court. This part of the appellant’s attack, whether it be on the reasoning or the impartiality of her Honour therefore fails.
(b) Mr Sheehy
65 The appellant submitted that Hartnett FM had erred by concluding that Mr Sheehy’s evidence could not be relied upon as he had been unable to recall when he received the letter dated 14 September 1999. In the appellant’s submission, Mr Sheehy’s affidavit confirmed that the resolution had, in fact, been carried on 10 September 1999 and that a letter dated 14 September 1999 had been sent to him shortly afterwards. Moreover, the appellant submitted, Mr Sheehy’s evidence on affidavit demonstrated that the date of the letter was corroborated by the date of the enclosed resolution.
66 For the respondent it was argued that it was open to her Honour to treat Mr Sheehy’s evidence as unreliable. Although he had deposed in his affidavit that the notice of resolution had been enclosed with the letter to him, he conceded under cross-examination that he had no recollection that a copy of the resolution had, in fact, been enclosed with the letter of 14 September 1999. Counsel for the respondent went on to contend that the appellant’s explanation that the copy resolution had been enclosed with the letter so that it could be filed by Mr Sheehy was inconsistent with the latter’s evidence that he was neither Bellhop’s company secretary nor accountant by September 1999. According to the respondent, the letter of 14 September 1999 was merely a courtesy communication which, in its own terms, suggested that it had been about two years since there had been any professional relationship between Mr Sheehy and Bellhop. As well, the respondent submitted, the appellant’s claim that the resolution had been enclosed so that it could be filed by Mr Sheehy was inconsistent with his claim to have sent the resolution to ASIC himself.
‘1. That I was a partner in the accounting firm Sheehy Saw & Associates until 30th June 2000 at which date I became sole proprietor.
2. That this firm were the accountants for Mr Joosse, his family and business.
3. That I have been requested to make this affidavit and recall my recollections relating to a letter dated 14th September 1999 received from Mr Joosse.
4. That I do recall and hereby confirm receiving such letter and that I have no reason whatever to suspect that this letter was not sent to our office on or about the date that is shown on the letter. That date was supported by the date on the resolutions that were enclosed.
5. That usage of the date received stamp is not inconsistent with office procedure.
6. That Mr Joosse collected all his files and records from our office.
7. That over the many years that we have been associated with Mr Joosse we have found him to be a person of the highest integrity.’
68 Mr Sheehy attended at the hearing on 8 March 2005 and was cross-examined on his affidavit. He identified the letter of 14 September 1999 and acknowledged that Mr Joossé had provided him with a copy of that letter about a week before he prepared and swore his affidavit of 31 January 2005. Without looking at the letter, he was unable to recall whether it had been accompanied by any attachments and had no recollection of when he had seen a copy of the minute recording the resolution for winding up. He also conceded that the letter could have been received two months or two years later than, presumably, the date it bore of 14 September 1999. When questioned by the Federal Magistrate, Mr Sheehy acknowledged that the impression of the “date received” stamp on the letter was indecipherable. The letter was dated 14 September 1999 under the letterhead of David Keys Australia Pty Ltd signed by Mr Joossé and was in these terms;
‘Dear Gerard,
It is with regret that we advise you that last Friday, 10 September it was resolved to voluntary withdraw from all business and commence winding up.
You know better than anyone the enormous difficulties that we have encountered ever since buying the "David Keys" brand name and the never ending claims from people mistaking us for the original owner and producer of "David Keys" D. K. Textiles Pty Ltd.
Sadly the restructure of the companies in 1995 did not alleviate these problems as had been promised and hoped, but in fact made them worse.
Jackie and I are tired of being forced to defend ourselves against unfounded claims often at great cost. The seemingly never ending litigation of late has taken its toll emotionally as well as financially. Since moving to Seaford life has become unbearable and recent claims by the ATO against Bellhop, a company that never had employees or a bank account as you well know is the straw that broke the camel's back.
We are tired of continuously being made to argue and defend ourselves against such claims and have decided to close up the businesses for good. Bellhop of course was never a `business' in the true sense or in any state to conduct one and I have no idea how one winds up a company that has neither assets or bank accounts, nor creditors or debtors. But I presume that ASIC will just deregister the companies as it notified it would earlier this year, if it has not done so already.
Gerard, we have not been in touch as much as we should have over the last 2 years, but both Jackie and I have appreciated the professional service and assistance that you and your staff have always provided over the years and on behalf of the family we thank you all most sincerely.’
69 Her Honour’s analysis of the evidence of Mr Sheehy is to be found at [29] of the reasons below where paras 4 and 5 of Mr Sheehy’s affidavit were set out and the reasons continued;
‘Cross examined as to his affidavit evidence, he presented as a witness on whose testimony the respondent could not rely to establish his case. I find he has no recall on what date he received a letter allegedly written on 14 September 1999 and forwarded to him. His evidence is that he could have received that letter two months or two years after thedate it bore. His evidence was that he could not recall if a minute of a meeting was enclosed in any correspondence of allegedly 14 September 1999 and received by him on a date unknown. His affidavit evidence was that usage of the date received stamp was not inconsistent with office procedure. His evidence at trial was that he no longer uses that procedure and that the stamp date could not be read because it had not printed out properly. His evidence did not support his affidavit material.’
70 That analysis is consistent with the salient features of Mr Sheehy’s evidence described at [67]-[68] above and allowed her Honour to decline to accept that a resolution for the voluntary winding up of Bellhop had been carried on 10 September 1999. It is also significant that the letter contains no internal reference to any enclosures. As well, the letter commences with a statement that “last Friday, it was resolved to voluntary withdraw from all business and commence winding up.” It does not indicate which companies were to be wound up and is at least equally consistent with a decision taken to close the “business” of either or both David Keys Australia Pty Ltd and Bellhop and take, in the future, any formal steps necessary to effectuate a winding up.
71 For these reasons it was not only open but appropriate for her Honour to have derived no assistance from the evidence of Mr Sheehy on the question of whether, and, if so, when a resolution was carried for the voluntary winding up of Bellhop.
(c) Mrs Joossé
72 I have, at [42]-[45] rehearsed the evidence of this witness and the learned Federal Magistrate’s analysis of it. For the reasons explained at [47] above, the rejection of Mrs Joossé’s evidence as lacking probative weight in the resolution of the ultimate question was clearly open on an evaluation of the whole of the evidence. Accordingly, it cannot sustain an attack based on an apprehension that her Honour had not brought an impartial and unbiased mind to the determination which she had to make.
Allegation that the Federal Magistrate’s Court “dispensed with the laws of the Commonwealth”
73 This third ground of appeal was particularised in sub-paras (i) to (vi) which have been set out in the second part of [5] above. It can readily be seen from a perusal of those particulars that, in part, they reiterate alleged errors of law, denials of procedural fairness or miscarriages of discretion which were identified in grounds (a) or (b) of the notice of appeal. For the reasons already explained, none of those errors has been made out.
74 Insofar as ground (c) raises fresh complaints against the orders of the Federal Magistrates Court they cannot avail the appellant as independent grounds of appeal. For example, s 5 of the Constitution makes “all laws made by the Parliament of the Commonwealth ….. binding on the courts, judges and people of every State and of every part of the Commonwealth.” However, a mere recital of that application cannot, of itself, found an appeal against an exercise of federal judicial power. It is necessary for the appellant to identify specifically each respect in which the judicial officer appealed from has exceeded or failed to exercise the power or otherwise acted contrary to a law of the Commonwealth. Except to the extent raised by grounds (a) and (b) of the notice of appeal, the appellant has failed to allege with sufficient particularity any error of fact or law made by Hartnett FM or any respect in which her Honour’s discretion miscarried. The appellant’s gratuitous invocation in ground (c) of his notice of provisions of the Corporations Act 1989, the Income Tax Administration Act 1936, the Acts Interpretation Act 1901, the Coronation Oaths Act 1688, and the Crimes Act 1914 cannot supply the deficiency which I have just identified. Ground (c) of the notice of appeal must therefore be rejected in its entirety.
Conclusion
75 It will be apparent from the foregoing reasons that the appellant has failed to make out any of the three grounds extensively particularised in his notice of appeal. The appeal must therefore be dismissed. I shall order that the respondent’s costs of the appeal form part of the petitioning creditor’s costs in the bankruptcy.
|
I certify that the preceding seventy-five (75) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan. |
Associate:
Dated: 28 March 2007.
|
The appellant appeared in person |
|
|
Counsel for the Respondent: |
Ms H Riley |
|
Solicitor for the Respondent: |
Australian Government Solicitor |
|
Date of Hearing: |
13 April 2006 |
|
Date of Judgment: |
28 March 2007 |
