FEDERAL COURT OF AUSTRALIA

George v Fletcher (Trustee) (No 2) [2010] FCA 655

THE COURT ORDERS THAT:

1.                  The application for a stay of the orders of the Full Court is dismissed.

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 Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

1                                             Ms George has, by notice of motion filed today by leave, applied for the following orders:

1          A stay from part of the judgment of QUD47/2009 of the Federal Court of Australia, Justice Ryan, Justice Marshall, and Justice Logan, given on 28 May 2010, pages 84 and 86, in respect to the car, float, and horse.  With respect to orders dated 9/2/09, FMC 3, 4, 5, 10, an order dated 5/12/2008 FMC amended 11/12/2008.1.

2          The applicant seeks leave to file an affidavit dated 16/6/2010 in the Full Court of Australia.

3          The applicant seeks procedural orders that allow his Honours to deal with the remaining assets being the car, float and the horse as described within the enclosed affidavit by way of the papers.

4          The applicant seeks the final orders on the car, horse and float as follows. [sic]

2                                             It is not necessary, for present purposes, to set out the “as follows.” 

3                                             The affidavit to which Ms George refers in that notice of motion was also the subject of a grant of leave to file the same in court, subject to a reservation in respect of such relevance, if any, it had to the hearing of the application made by the notice of motion.  The parties to the appeal, insofar as they were ever active parties to the appeal, were each represented at the time when leave to file the notice of motion was sought.  Those parties were Ms George’s Trustee in Bankruptcy (Mr Fletcher), Dr Peter Ironside Pty Ltd, Dr Ironside, and the National Australia Bank Limited.  The other named party to the appeal, Ms George’s sister (Ms Susan Wilson) had earlier signified that she did not wish to play an active role in the appeal.

4                                             The application was made, so Ms George informed me, as a result of advice which she had received from officers of the High Court of Australia’s Registry as to the desirability of seeking from the court below, rather than the High Court, a stay of the operation of any orders in respect of which it was proposed to seek special leave to appeal to the High Court.  That advice, with respect, was doubtless cast with an eye to what was said by Brennan J (as his Honour then was) in Jennings Construction Limited v Burgundy Royale Investments Pty Ltd No. 1 (1986) 161 CLR 681 at 684 - 685.  There had been, in that case, an application to the High Court for a stay of the operation of orders of an intermediate appellate court.

5                                             His Honour made reference to the possession of an inherent jurisdiction on the part of the High Court to stay the operation of orders that were the subject of an application, as yet undetermined, for special leave.  Having so done, his Honour stated:

In future, there should be no inhibition on the court in which the matter is pending framing a stay order, if a stay be appropriate, to avoid the necessity for application to this Court. In exercising the extraordinary jurisdiction to stay, the following factors are material to the exercise of this Court's discretion. In each case when the Court is satisfied a stay is required to preserve the subject- matter of the litigation, it is relevant to consider: first, whether there is a substantial prospect that special leave to appeal will be granted; secondly, whether the applicant has failed to take whatever steps are necessary to seek a stay from the court in which the matter is pending; thirdly, whether the grant of a stay will cause loss to the respondent; and fourthly, where the balance of convenience lies.

6                                             Ms George has not as yet filed an application for special leave to appeal to the High Court, nor, it must be said, is it readily apparent from her affidavit filed today by leave, quite what the basis upon which she proposes to seek special leave is.  Some limited precision in that regard was, though, able to be gleaned in the course of oral submissions. 

7                                             As to jurisdiction to grant a stay, the position seems to be the subject of express provision in s 25(2) of the Federal Court of Australia Act 1976 (Cth) (Federal Court Act).  It is there provided, materially:

(2)        Applications:

(d)        to stay an order of a Full Court;

must be heard and determined by a single judge, unless:

(f)        the application is made in a proceeding that has already been assigned to a Full Court and the Full Court considers it is appropriate to hear and determine the application.

8                                             Ms George had foreshadowed, to the registry of this Court, the making of an application today, in respect of a stay.  Today was the day appointed for the delivery of orders and reasons for judgment on the remaining subject of the appeal, which was the subject of costs.  The other orders of the Full Court were made on 28 May 2010, for reasons which were then published. 

9                                             In light of the courtesy extended to the Court by Ms George in foreshadowing the making of an application for a stay, and having regard to the provisions of s 25 of the Federal Court Act, which I have mentioned, I took the course, in advance of today, of consulting with Ryan and Marshall JJ who, together with me, constituted the Full Court to which this matter was assigned, as to whether it was appropriate for the matter to be dealt with by a single judge.  Of the members of the Full Court, I am the only Queensland resident judge.  Each of us reached a view (necessarily, of course, provisionally) that it was a matter that was appropriate for me to deal with, rather than for it to be dealt with by the Full Court, as constituted for the purpose of the appeal assigned to it. 

10                                          When the stay application was brought on by Ms George, I stated to the parties the view which had been reached as to the course to adopt, provisionally, by the Full Court, with a view to receiving such submissions, if any, as any may wish to make in respect of that course.  Each, including Ms George, supported the view provisionally reached by the Court that it was appropriate for the stay application to be dealt with by a single judge.  I then proceeded to hear submissions, in respect of whether or not to grant a stay, being of the view that, in the circumstances just described, I possess jurisdiction to grant a stay, if so persuaded. 

11                                          It emerged in the course of Ms George’s submissions that there were four items of property, with which her stay application was concerned. 

12                                          Adopting, in so far as relevant, abbreviations already used in the course of the Full Court’s judgments, those items of property comprised the horse, the land cruiser, the Moggill property and another item of property, a horse float.  I propose to deal with the question of whether or not to grant a stay by reference, separately, to each of those items of property.

13                                          In so doing, an overriding consideration is whether, in respect of the matter as it so relates, there is a substantial prospect that special leave to appeal will be granted, whether the grant of a stay will cause loss to any respondent and where the balance of convenience lies.  In other words, considerations which were set out by Brennan J in Jennings Constructions v Burgundy Royale Investments, as pertinent to the question of whether the High Court ought to stay the operation of the judgment of an intermediate appellate court, also have relevance to whether or not, where that intermediate appellate court is approached on the subject of a stay, a should be granted.

The Float

14                                          The order made by the Federal Magistrates Court, on 9 February 2009, discloses that that order makes no reference to the float.  It deals with the Moggill property, the land cruiser and the horse.  It was from that order, and that order only, that leave to appeal to this Court was granted, on 25 March 2009:  see George v Fletcher (Trustee) [2009] FCA 264. 

15                                          Also read today was another order of the Federal Magistrates Court, one made, originally, on 5 December 2008 and amended on 11 December 2008.  That order records the following, materially, as having been made by consent:

That the dual axle Lara construction horse float, registration number 938 QMZ is property vested in the trustee.

There has never been a grant of leave to appeal in respect of the order made in the Federal Magistrates Court, in respect of the float.  It is, having regard to the fact that the order concerned was made by consent, a complete and utter distraction to give any further consideration, in these circumstances, to the question of whether there ought to be any stay of the orders of the Full Court on the appeal, in relation to the float.  The appeal was in no way concerned with that item of property.

The Moggill Property

16                                          The effect of the orders of the Full Court in respect of the Moggill property was to remit the matter to the Federal Magistrates Court for trial.  Ms George wants a trial to occur in respect of the question of whether the Moggill property is vested or not vested, for the purposes of the administration of her bankrupt estate, in the trustee.  The concern which she voiced today, having regard to the trustee’s being registered on the title at present in respect of the Moggill property, was that it might be sold pending the hearing and determination of her challenge to the question of in whom, truly, that property is vested, for the purposes of administration of her bankrupt estate.  She did not, in terms, foreshadow any challenge to the order of remission by way of an application for special leave to the High Court.  Rather, particularly having regard to her present residency in the Moggill property, and I infer as well from the circumstances apparent in the course of the hearing of the appeal, her child’s present residence, her concern is that of the house may be sold.

17                                          The absence of any foreshadowed challenge in the High Court in respect of the orders of the Full Court insofar as they touch on the Moggill property, is itself fatal to the question of whether or not to grant a stay.  Quite apart from that though, there is ample jurisdiction on the part of the Federal Magistrates Court, if cause be shown, to enjoin the trustee from disposing of the Moggill property pending the hearing and determination of the matter remitted for trial.  It must be said at once that the trustee has not evinced any intention to this Court at any time of doing other than administering the bankrupt estate according to law, nor has the trustee evinced any intention in the face of an order of remitter to seek to sell the Moggill property pending the hearing and determination of the matter remitted for trial.  There is no basis whatsoever to stay the operation of the remitter order itself.  Indeed, it would be quite contrary to Mr George’s particular and often expressed interest in a trial so to do. 

The Horse and the Landcruiser

18                                          The proposal bases of challenge are not, as I have already noted, readily apparent from the supporting affidavit.  It would seem, having regard to an exchange which I had with Ms George in the course of submissions, that the foreshadowed special leave application, insofar as it relates to these items of property, would seek to raise for consideration on appeal by the High Court the question as to whether summary judgment ought to have been upheld in respect of these items of property. 

19                                          The criteria for granting special leave to appeal, as set out in s 35A of the Judiciary Act 1903 (Cth) (Judiciary Act) in a non-exhaustive way, are:

In considering whether to grant an application for special leave to appeal to the High Court under this Act or under any other Act, the High Court may have regard to any matters that it considers relevant but shall have regard to:

(a)        whether the proceedings in which the judgment to which the application relates was pronounced involve a question of law:

(i)         that is of public importance, whether because of its general application or otherwise; or

(ii)        in respect of which a decision of the High Court, as the final appellate court, is required to resolve differences of opinion between different courts, or within the one court, as to the state of the law; and

(b)        whether the interests of the administration of justice, either generally or in the particular case, require consideration by the High Court of the judgment to which the application relates.

20                                          Ms George did not seek, in her submissions, to engage with the matters expressly stated to be relevant in s 35A of the Judiciary Act.  In relation to the horse and the Landcruiser there was a unanimity of view in the Full Court that summary judgment had aptly gone, or in any event, that there was no reason to disturb the orders made in respect of those items of property.  In our joint reasons for judgment, Justice Ryan and I, at [83], observed of Ms George’s pleaded position with respect to the horse and the Landcruiser as follows:

Ms George’s amended statement of claim in respect of these two items of property, if treated as a response to the bankruptcy trustee’s claim in the Federal Magistrates Court, put her case no higher than a right to “life use” of the horse and the land cruiser on the basis that each was owned by her sister, Ms Ironside, the fifth respondent.  The definition of “property” in s 5 of the Bankruptcy Act is sufficiently wide that the right of use pleaded by Ms George constituted property which passed to her trustee in bankruptcy, assuming in her favour that the position was as she had pleaded it to be.

21                                          Further, on 8 December 2008 the bankruptcy trustee did point to evidence he had filed which disclosed that Ms Ironside had, by deed of settlement (with the bankruptcy trustee dated 28 October 2008) agreed to transfer the horse and Landcruiser to the bankruptcy trustee.  Last, there was nothing revealed at the trial in December 2008 which suggested that Ms George had a reasonable prospect of successfully defending this part of the claims for relief made by the bankruptcy trustee.  We added at [84]:

Further, even if, as the learned federal magistrate allowed in his reasons for judgment, contrary to Ms George’s pleaded position, there had been evidence which showed that Ms Ironside held either the horse or the land cruiser in trust for Ms George, the beneficial interest in each item of property had passed to her bankruptcy trustee on the commencement of her bankruptcy. The exception for which s 116(2)(ca) of the Bankruptcy Act provided in respect of means of transport was inapplicable in the case of the land cruiser because, on the only valuation evidence before the Federal Magistrates Court, that vehicle had a value in excess of the prescribed amount.

22                                          Ms George sought to agitate, in her affidavit, questions which went to whether the Landcruiser and the horse were each items of property which were (or at least which represented) what one might term protective moneys.  This is quite contrary to her pleaded position before the Federal Magistrates Court.  She put in her submissions this morning that this position that she aired in her affidavit would have emerged had she been allowed further time on the hearing of the appeal.  In other words, had the appeal gone for three rather than two days.  The appeal was heard in the time allocated, and in any event, in the face of an expressly pleaded position which is quite contrary to that sought to be aired today it is difficult to see what purpose there would have been in the allowing of further time.

23                                          Also sought to be agitated in the affidavit are factual questions touching upon the worth of the Landcruiser.  An application for special leave, and, for that matter, an appeal to the High Court, is not a place to agitate disputed questions of fact, even assuming, and it is a very large assumption indeed, that there is any place for the agitation of those questions having regard to the pleaded position in respect of these items of property. 

24                                          Having regard to that pleaded position and the criteria set out in a non-exhaustive way in s 35A of the Judiciary Act as relevant to the question of whether special leave should be granted, I find it very difficult indeed to regard any special leave application as having any reasonable prospect of success. 

25                                          For these reasons, the stay that is sought by application today is refused.

Associate:

Dated:         23 June 2010