FEDERAL COURT OF AUSTRALIA

Spencer v Neo Rock Pty Ltd (In Liquidation) [2009] FCA 1281

PRACTICE AND PROCEDURE – appeal from dismissal of a single judge acting under s 25(2)(a) of the Federal Court of Australia Act 1976of an application for leave to appeal the decision of the primary judge – consideration of whether there can be an appeal from the decision of a single judge refusing or granting leave

Federal Court of Australia Act 1976 (Cth), s 25(2)(a)

Corporations Act 2001 (Cth), ss 417A, 459S

Reid v Nairn (1985) 60 ALR 419

Spencer v Neo Rock Pty Ltd (In Liquidation) [2009] FCA 845

MICHAEL JOHN SPENCER v NEO ROCK PTY LTD ACN 110 874 283 (IN LIQUIDATION) and DEPUTY COMMISSIONER OF TAXATION

QUD 222 of 2009

REEVES J

16 OCTOBER 2009

BRISBANE

THE COURT ORDERS THAT:

1.                  The application for an extension of time to file and serve a notice of appeal be dismissed.

2.                  There be no order as to costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

EX TEMPORE REASONS FOR JUDGMENT

(Corrected from the transcript)

1                     Mr Spencer has applied to file an application for leave to appeal out of time.  The decision he seeks leave to appeal is that of Greenwood J delivered on 3 August 2009.  In that decision, Greenwood J acting under s 25(2)(a) of the Federal Court of Australia Act 1976 (Cth), refused Mr Spencer leave to act as a director of the company Neo Rock Pty Ltd for the purpose of making an application to the Court for leave to appeal and his application for leave to appeal the decision of Logan J delivered on 12 February 2009.  In his decision, Logan J ordered that the company Neo Rock Pty Ltd be wound up and an official liquidator be appointed.

2                     In Reid v Nairn (1985) 60 ALR 419 the Full Court (Fox, Forster and McGregor JJ) held that there is no appeal from a decision of a single judge refusing or granting leave to appeal in these circumstances. 

3                     Mr Spencer has submitted that that decision should be distinguished, because:

The hearing before Greenwood J was vitiated by it being determined “on the papers” when an appearance was required. 

Mr Spencer says that, as a result, he was not heard on the merits of his application before Greenwood J.  This appeared to be a complaint that he was denied procedural fairness.

4                     In his decision, Spencer v Neo Rock Pty Ltd [2009] FCA 845 at [5], Greenwood J set out the circumstances surrounding the hearing before him on 3 August 2009.  He noted that, on the day before the hearing, Mr Spencer wrote a letter to the Court seeking, among other things, an adjournment of the matter for a week or so.  Greenwood J noted that the letter concluded with this statement:

In the alternative, [the Court] may be minded to determine the matters ‘on the papers’ if there is power to do so as appears may be the case.  I have no objection to that course.

5                     Mr Spencer says that that statement was only directed to Greenwood J determining his application for leave to act as a director under s 471A of the Corporations Act 2001 (Cth) (“the Act”) and not to his application for leave to appeal the decision of Logan J.  As a result, he says he was adversely affected by the fact that Greenwood J proceeded to deal with the application for leave to appeal, because he was not present and able to put his case in person and act as a contradictor.  I note in passing that Ms Walker has pointed out that, in the lead up to the hearing on 3 August 2009, directions were given that made it clear that there would be no further adjournment of the matter beyond 3 August 2009.

6                     Even if I were to accept that Mr Spencer was acting under a misapprehension when he stated that he agreed to the court dealing with the matter on 3 August in his absence, I do not consider his absence on 3 August caused him any prejudice in the sense that he was denied procedural fairness.  This is so because Greenwood J recorded (at [6] of his decision) he had before him written submissions by Mr Spencer directed to the issues involved in both his applications for leave under s 471A of the Act and for leave to appeal. 

7                     Based on the latter submissions, Greenwood J considered the decision of Logan J, particularly his approach to s 459S of the Act and the authorities relating to that, and concluded that Logan J was not in error in the approach he took to s 459S: at [10] – [12].  Having reached that conclusion, Greenwood J then considered Mr Spencer’s written submissions directed to the application of that section in the circumstances, in particular, as to whether or not the company had established that it was solvent in accordance with the approach Logan J had taken to s 459S of the Act.  At [17] to [19] of his decision, Greenwood J dealt with each of Mr Spencer’s submissions in turn on this issue, and rejected them.  In summary, he concluded that there was no material before the Court which would go to establish that the company was, indeed, solvent, as Mr Spencer claimed.  He, therefore, refused both the application for leave to appeal the decision of Logan J and, as a necessary consequence, the application for Mr Spencer to have leave to act as a director under s 471A of the Act: at [19].

8                     Given those circumstances and the fact that Greenwood J considered all of the submissions Mr Spencer had put before the court in his written submissions on his application for leave to appeal, I reject Mr Spencer’s submission that he was denied procedural fairness, or that this provides any basis for distinguishing the decision in Reid v Nairn (1985) 60 ALR 419.  It follows that it is not open to Mr Spencer to seek to appeal the decision of Greenwood J, refusing to grant him leave to appeal the decision of Logan J.  For these reasons, I order that Mr Spencer’s application for an extension of time to file and serve a notice of appeal be dismissed.

Associate:

Dated:         10 November 2009