FEDERAL COURT OF AUSTRALIA

Hutchings v Australian Securities and Investments Commission [2017] FCA 858

ORDERS

THE COURT ORDERS THAT:

1.    The appeal be allowed.

2.    Orders 1 and 2 made by the Federal Circuit Court (Judge Street) on 31 May 2017 be set aside.

3.    In lieu thereof, order that the hearing of the creditor’s petition be adjourned subject to the following:

(a)    The undertakings to the Court which are given through counsel and set out in (a)-(d) of [26] in the affidavit of Mr Hutchings of 20 June 2017.

(b)    Mr Hutchings preparing written submissions in draft form that he intends to rely upon in the Queensland appeal by no later than 28 July 2017 and providing these to ASIC and the docket judge to whom this matter is referred.

(c)    Any consideration of the dissolution of the adjournment and otherwise any further relief in the appeal be remitted to Lee J, for any reconsideration that might be requested consequent upon the terms of the written submissions.

4.    Liberty to apply on 7 days’ notice.

5.    The respondent pay the appellant's costs of the appeal, to be assessed and payable forthwith.

6.    The costs of the appeal payable to the appellant be set-off against the amount of $50,983.76 owed by the appellant to the respondent that is the subject of the creditor’s petition.

7.    Costs before the Federal Circuit Court be reserved until final disposition of the creditor’s petition.

8.    Annexure GH1 to the affidavit of Guy Hutchings sworn 20 June 2017 not be made public on the Commonwealth Courts Portal or otherwise without an order of the Court.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Revised from the transcript)

ALLSOP CJ:

1    This is an appeal from orders made by a judge of the Federal Circuit Court on 31 May 2017 extempore ordering the sequestration of the estate of the appellant, Mr Guy Hutchings. The orders made were that the estate of Mr Hutchings be sequestrated under the Bankruptcy Act 1966 (Cth) (the Act) with the costs to be paid and fixed, and there was a refusal by the primary judge to grant an order under s 52(3) of the Act granting a stay of proceedings under the sequestration order for a period of 21 days.

2    The matter came before the duty judge last week, who made an order up to and including yesterday staying the sequestration order and ordering that the appeal proceed yesterday. I varied those orders last week providing for a case management hearing yesterday morning and the conduct of the appeal, if necessary, to proceed yesterday.

3    The matter came before me after hearing the parties at the case management hearing. I proceeded to hear the appeal, which we finished this morning. Yesterday afternoon I made an order under s 52(3) of the Act staying proceedings under the sequestration order until Wednesday of this week, being the 21st day from the date of the making of the sequestration order on 31 May.

4    As an introduction to these reasons, two things should be emphasised which are central to every application in the bankruptcy jurisdiction almost without exception. First, the jurisdiction is not about debt collection; it is about the change of status of insolvent persons. The question of solvency or insolvency is at the root of the jurisdiction. That said, however, insolvency can arise from a whole raft of reasons, and those reasons have a connection with the second matter which attends every single application, and that is not just the economic, but the human consequences that attend the change of status and the change of lives of people who are made bankrupt.

5    The importance of this is best understood by reminding oneself of what one of the masters of bankruptcy in this country, Deane J, said in a dissenting judgment in Kleinwort Benson Australia Ltd v Crowl [1988] HCA 34; 165 CLR 71. Though the circumstances to which his Honour was referring do not describe accurately or completely the circumstances of Mr Hutchings, some of the matters to which Deane J referred should be understood in the background of this application. He said the following at 82:

It is true that the strictness of the above rules leaves open the possibility of abuse by unscrupulous debtors. That is, however, and unavoidable concomitant of the protection of ordinary people faced with the threat of being made bankrupt. Many, and possibly most, of the petitions in the bankruptcy lists of this country seek the bankruptcy of honest, albeit unbusinesslike or naive, people whose indebtedness springs from causes which evoke sympathy rather than indignation. For such people, bankruptcy does not represent a game to be played to the frustration of their creditors. It represents a pronouncement of failure and humiliation attended by the fear of unknown consequences and the susceptibility to criminal punishment for what would otherwise be innocent conduct.

(citations omitted)

6    I say immediately in the recognition of the facts in this case that serious findings as to the honesty of Mr Hutchings have, in fact, been made by a judge of a Supreme Court. The importance of the passage is to remind myself of the centrally human relationship between the notion of insolvency and its consequences.

7    Mr Hutchings was a senior executive in a company which can be simply identified by its acronym, MFSIM, which was a related company to another company, MFSL. He began employment in this group in 2006 as a senior executive below the rank of chief executive, but in the latter part of 2007 became the chief executive of MFSIM.

8    The group was a fund management group handling funds and MFSIM was the responsible entity for the conduct of, relevantly speaking, the fund being known as PIF. In late 2007, the global financial crisis began to become apparent. This led to significant financial pressures on companies in the group from lenders, one in particular, towards the end of 2007. Mr Hutchings, as I have already said, was, by this stage, the chief executive officer of one of the companies in the group. Mr White was the chief executive of the main group company, MFSL.

9    From a period from November 2007 to approximately March 2008, a series of transactions and events took place which were the subject of proceedings in the Supreme Court of Queensland which lasted 60 days between November 2013 and September 2014. The proceedings were brought by the Australian Securities and Investments Commission (ASIC) and proceeded against, amongst other people, a Mr King, a Mr White, Mr Hutchings, a Mr Anderson and a Ms Watts. The proceedings concerned the withdrawal from MFSIM’s fund, PIF, of sums of almost $150 million which were moved in broadly two or three tranches and used, in significant part, to repay the borrowings of one of the other companies in the group.

10    The borrowing occurred in a way which did not follow the procedures of MFSIM and which was said by ASIC in the proceedings to be both irregular and dishonest. It was not said that Mr Hutchings had any part in the withdrawal of or the movement of some $130 million of those funds, but it was said that he had an involvement in the transfer of approximately $17 million out of the fund of which MFSIM was the responsible entity.

11    The case against Mr Hutchings involved his asserted wrongful conduct in the removal of those funds as well as two other bodies of conduct. The first of those two other bodies of conduct was the creation of what were said to be false documents to disguise and to mislead about what had happened in relation to both the $130 million and the $17 million. The third body of conduct was the use of those false documents to mislead others, in particular, in respect of Mr Hutchings, officers of the Royal Bank of Scotland who were inquiring about the use of moneys that had been borrowed from that bank which had been utilised, in fact, in some of the earlier transfers. Although it was the position that it was not said that Mr Hutchings was involved in the transfer of the $130 million, it was ASIC’s case that he was aware of it having happened during the course of the events which were said to be the creation of the false documents and their utilisation.

12    The primary judge in the Supreme Court proceedings delivered reasons for judgment on 23 May 2016, some 20 months after the conclusion of the hearing: see Australian Securities and Investments Commission v Managed Investments Ltd (No 9) [2016] QSC 109; 308 FLR 216. Nothing that I say hereafter is to be understood as a personal criticism of a very experienced trial judge. The judgment is a large one of nearly 350 pages. The pleading in the statement of claim in its fifth amended manifestation is nearly 200 pages long.

13    The long and short of the findings of the primary judge in the Supreme Court proceedings was that his Honour did not accept the honesty of Mr Hutchings and rejected significant parts of his evidence, if not the totality or relevant parts, in its self-exculpatory form and expressed the view that Mr Hutchings’ explanations were both unacceptable and not accepted and concluded broadly that Mr Hutchings’ participation in the affairs of the companies in the early part of 2008 and the creation of certain documents was – with others – an attempt to cover the true position and to mislead relevant parties, not just creditors but persons such as KordaMentha who had been called in to seek to salvage the affairs of the group.

14    To state the matter thus is to recognise a number of things. First, the catastrophic effect those conclusions will have on a man of 54 years in the finance industry, if I may use that expression. By saying that I am not casting doubt on the correctness of the conclusions. I was not the trial judge. But the catastrophic nature of those findings for any participant in commerce does not need to be explained. Secondly, of their nature, credit findings are not easy to overturn. It is unnecessary to state the clear law on that, but nevertheless credit findings are not insurmountable.

15    Thirdly, from a reading of Douglas J’s reasons, with the assistance of submissions from counsel yesterday and today, it is clear that the whole perspective of Douglas J’s conclusions about Mr Hutchings’ participation were significantly framed by his conclusions as to the lack of reliability of Mr Hutchings’ evidence and significantly based on an assessment of his credit. One of the reasons I say that is with the qualification I will come to. The primary affidavit of Mr Hutchings, which is before me without exhibits is 159 pages long and, on its face, carefully and clearly seeking to deal with all the relevant events with all the relevant documents.

16    There are significant and coherent explanations on the face of the affidavit about some crucial events which in the learned trial judge’s reasons are dealt with with no large degree of detailed analysis. I do not say that from that error can be demonstrated, but in my view, there is a real issue for debate as to the adequacy of the judgment in its terms in dealing with how Mr Hutchings has explained himself. It may be – and I do not either discount the possibility or conclude against the possibility – that when closely examined, aspects of the evidence are such as to dictate the kind of conclusion that the primary judge came to without the necessity to grapple with the detail of an explanation that can be seen to be false.

17    But there are, in my view, significant issues about how the conclusions have been reached conformably with giving Mr Hutchings’ case the attention that it may have deserved. One aspect that should be at the heart of this, I suppose, is how the documentation was prepared; that is, the documentation to deal with the funds that had been taken out of MFSIM. On their face, they were documents which purported to have anterior dates. The case of Mr Hutchings was that these were documents to form the basis of ratification by the board, a board which he claimed would not be misled about the fact that procedures had not, in fact, taken place before relevant events took place.

18    There is a logical tension in this, but it was a matter that from time to time one sees in commerce, and I remark on it, not to explain it away, but to recognise that there may well be significant difficulties in any appeal from Douglas J’s reasons and orders.

19    I have not said anything yet about the judgment under appeal. It was this broad matter that came to the judge below in the Circuit Court. The debt upon which the bankruptcy notice and then the creditor’s petition were founded was an order for costs in an interlocutory matter some years before which had not been paid by Mr Hutchings, notwithstanding the fact that it had become enforceable according to the ordinary practice in Queensland.

20    There was also a large sum of money paid in costs by ASIC to Mr Hutchings before the end of the trial, but for reasons which were discussed in submissions, but not needed to be dealt with by the evidence, there was no netting off at that point. So it is not the cost of the proceedings, nor the huge orders that were made against Mr Hutchings by the primary judge in due course this year of $28 million in compensation for his part in the payment out of the $17 million, or the $350,000 in civil pecuniary penalties ordered, or the no-doubt massive costs of the trial, which will be shared by the defendants: see Australian Securities and Investments Commission v Managed Investments Ltd (No 10) [2017] QSC 96. Rather, it is an order for costs of $50,000 or thereabouts to be paid arising from interlocutory applications during the course of the hearing.

21    I should add at this point, before going to what happened in the Circuit Court, that there was, it is common ground, an insurer funding the defence of Mr Hutchings, who had paid significant sums of money for defence costs, who may now claim the recovery of those defence costs, there having been made dishonesty findings against Mr Hutchings.

22    The matter came before the Circuit Court judge. The matter lasted about an hour in front of him, including an extempore judgment of five pages. There was evidence before his Honour and the matter was put to his Honour as follows: that Mr Hutchings could not pay the $50,000; that he strenuously wished to appeal the findings and the judgment; that his family would fund the appeal, paying the legal costs for him; that he had no significant creditors; and that he would undertake to ASIC that he would not dispose of any assets, other than in the ordinary course of living.

23    It may have been wiser to be somewhat more fulsome in his asset position, but the tolerably frank admission that he could not pay $50,000 led to a reasonable conclusion of a lack of solvency, which his Honour made. And so his Honour then looked at the application for appeal in the following framework in [5], that is:

The desire of the respondent to pursue those proceedings does not of itself identify any proper basis upon which the creditors’ petition should be adjourned. The statutory scheme in relation to the Act is one in respect of which bankruptcy proceedings are dealt with expeditiously. There is a public interest behind that requirement.

24    And then he came to the view that Mr Hutchings was insolvent. That framework is correct as far as it goes. However, the relationship between appeal, and insolvency and sequestration is discussed in a number of cases which are referred to in Culleton v Balwyn Nominees Pty Ltd [2017] FCAFC 8 at [36] to [39]:

36    A Full Court of this Court in Ahern v Deputy Commissioner of Taxation (Qld) [1987] FCA 504; 76 ALR 137 set out principles that, whilst they must be considered in the light of Part VB of the Federal Court of Australia Act 1976 (Cth) and especially s 37M, are of enduring importance. In that case a judge of the Court had refused an adjournment of the creditor’s petition that was based on a default judgment that was the subject of a pending appeal. The Court referred (76 ALR at 146) to the expression of the matter by Atkin LJ in Maxwell v Keun [1928] 1 KB 645 at 653 that was approved of in Bloch v Bloch [1981] HCA 56; 37 ALR 55 at 58 by Wilson J, with whom Gibbs CJ, Murphy and Aickin JJ agreed (at 56):

The decision whether or not to adjourn the hearing of the petition was within the discretion of the primary judge. It is well established that an appellate court will rarely interfere with a trial judge's exercise of discretion upon an application for adjournment. However, the refusal to grant an adjournment may in some cases prevent the party seeking it from presenting his case or defence and in some circumstances this may result in injustice of such kind or magnitude as to warrant interference on appeal. In Maxwell v Keun [1928] 1 KB 645 Aitken LJ [sic] said (at 653): “I quite agree the Court of Appeal ought to be very slow indeed to interfere with the discretion of the learned judge on such a question as an adjournment of a trial, and it very seldom does do so; but, on the other hand, if it appears that the result of the order made below is to defeat the rights of the parties altogether, and to do that which the Court of Appeal is satisfied would be an injustice to one or other of the parties, then the court has power to review such an order, and it is, to my mind, its duty to do so.”

37    The Court (76 ALR at 146) also referred to and approved the further but similar expression of the matter by Sir Jocelyn Simon P in Walker v Walker [1967] 1 WLR 327 (at 330):

First where the refusal of an adjournment would result in a serious injustice to the party requesting the adjournment, the adjournment should only be refused if that is the only way that justice can be done to the other party; and, secondly, that although the granting or refusal of an adjournment is a matter of discretion, if an appellate court is satisfied that the discretion has been exercised in such a way as would result in an injustice to one of the parties, such appellate court has both the power and the duty to review the exercise of the discretion.

38    In Ahern, in circumstances where there was accepted to be a genuine and arguable appeal, the Court said (at 148):

It is also well established that in general a court exercising jurisdiction in bankruptcy should not proceed to sequestrate the estate of a debtor where an appeal is pending against the judgment relied on as the foundation of the bankruptcy proceedings provided that the appeal is based on genuine and arguable grounds: Re Rhodes; Ex parte Heyworth (1884) 14 QBD 49 Bayne v Baillieu (1907) 5 CLR 64 and Re Verma; Ex parte DCT (1985) 4 FCR 181.

39    No submission was put that these principles are distinct from the application of the judgment of Dixon, Evatt and McTiernan JJ in House v The King [1936] HCA 40; 55 CLR 499 at 505. These principles can be seen to be an illustration or example of the residual category in House (at 505):

It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion …

25    The long and the short of it is that where a refusal of an adjournment would result in a serious injustice to the party requesting the adjournment, the adjournment should only be refused if that is the only way that justice can be done to the other party and, secondly, that although the granting or refusal of an adjournment is a matter of discretion, if an appellate court is satisfied that the discretion has been exercised in such a way as would result in an injustice to one of the parties, such appellate court has both the power and a duty to review the exercise of the discretion.

26    The primary judge then went on to draw from the evidence that had been put before him that Mr Hutchings, by having his family members agree to pay the legal costs for him, was only increasing the body of creditors to his estate. With respect, I think that was an unnecessarily narrow conclusion and not one that was necessarily available from the facts. The likelihood was, from the evidence that was given, that the family members would be willing to make that undertaking without legal obligation. In any event, that was a perfectly open possibility that a question or two and some inquiry might have satisfied, or might have brought out the position that has now been made clear; that is, that his family will do this by way of gift. Secondly, his Honour, in [9], accepted that – or assumed that – the grounds were bona fide. He said it was “not one which is likely to give rise to the capacity to meet the outstanding debts”. This referred to a question of the relationship between the appeal and this costs order. He said that someone “who … is insolvent should [not] be allowed to continue to incur liabilities.”

27    He then made some comments on the likely success of the appeal in a way that displayed no real attention to any particular argument, but because dishonesty was involved and because there were apparently 19 grounds of appeal, that the pursuit of the appeal might be bona fide but he was not prepared to conclude that there was any real prospect of success.

28    The difficulties with the Circuit Court judgment are as follows.

29    The primary judge, in his reasons, expressed the view that there was, in effect, little prospect of the appeal being effective to create the likelihood of a cross-claim or counter-claim or set-off amounting to $50,000. Before the primary judge there were submissions filed on behalf of Mr Hutchings which sought either that the petition be dismissed based on s 52(2)(b) of the Act or that the petition be adjourned. The submissions placed before the Circuit Court judge did not descend into significant detail about the nature of the issues on appeal.

30    Particular reliance was placed on Endresz v Australian Securities and Investments Commission (No 2) [2015] FCAFC 33; 228 FCR 334 for the proposition that if the Court’s discretion under s 52 of the Act is not exercised to dismiss the petition, the question is whether to proceed to an adjournment. It was submitted that to adjourn a petition under s 33 involves broader considerations than those relevant to s 52. In [24] of the submissions on behalf of Mr Hutchings, it was stated that it was relevant to understand whether the appeal was bona fide and, if successful, would lead to an ability to pay the debt the subject of the petition.

31    The primary judge, in part by reasons of the submissions put before him, did not deal with any real consideration as to the nature of the appeal and the issues to be raised. In my respectful view, it was not possible to come to the view of a lack of force in the appeal without some greater consideration of the underlying features of it. My view is that for at least two reasons there is error in the reasons of the primary judge.

32    The first is his factual findings as to family members and an asserted legal liability to repay them for the costs of the appeal and the second is the view expressed, in particular, in [9] and elsewhere that there is little prospect of the appeal being successful. Applications of this kind are often extremely difficult, as this one is. That is because once a detailed and considered judgment has been delivered by a trial judge it is not often easy to demonstrate, in short order, that an appeal has fundamentally good prospects of success.

33    This is especially so in a case such as this where there has been a long judgment delivered in a case that took 60 days. Before one can really come to the view that prospects of success are negligible, one would be required to undertake more than a cursory examination of it and to decry it simply because there are 19 grounds of appeal. I have been assisted, if I may respectfully say so, by both Mr Brady, who appears for ASIC, and Mr Stoljar, who appears for Mr Hutchings (and who did not appear before the Circuit Court judge). I do not propose to lengthen today’s reasons with a detailed examination of the judgment of Douglas J or the complaints made by Mr Stoljar in relation thereto.

34    I am, however, from that debate satisfied that not only is the appeal bona fide, as the primary judge accepted, but that it is at least arguable. Though there is a necessary difficulty in overturning credit findings, there are conclusions on credit without perhaps some of the reasoning that one might have expected. I appreciate the difficulty of a long case and the difficulty in expressing oneself in a manner that keeps the reasons tolerably succinct and also tries to explain the often inexpressible reasons why someone’s evidence is not accepted. Nevertheless, I think there is at least arguability in the appeal as to the credit findings and the participation by Mr Hutchings in the $17 million transfer.

35    It is possible to look at the other two grounds or areas of debate about Mr Hutchings’ conduct as separate. If one does, one can see that there might be said to be a failure by the learned trial judge to grapple with a significant body of explanation that Mr Hutchings gave in a lucid fashion in his affidavit. The difficulty is, however, I think, that the whole case has been expressed – and I am not critical of this – from the perspective of the lack of acceptance of Mr Hutchings’ honesty. Once one understands that, his explanations in detailed form in his affidavit might be seen to not require the attention that they might in other circumstances.

36    Thus, the whole of the judgment might well have a susceptibility to appeal if there is acceptable force in the complaints on the finding of credit. My view that it is an arguable case is not, as I said, a criticism of the trial judge, nor is it a prediction of success. It is enough to invoke, in my view, the kinds of expressions of principle to which reference was made in Culleton [2017] FCAFC 8 in [36] to [39]. If it be the case that there has been error and that Mr Hutchings’ position is such as to require correction of the trial judge then to make him bankrupt over this $50,000 might seem to be unjust.

37    A bona fide and arguable appeal should generally (though not always, of course) be the foundation of at least a reasonable argument for an adjournment, subject to conditions if necessary. The qualification to that is twofold: one general and one particular to this case. The general qualification is the protection of creditors. To that end, Mr Hutchings’ representatives today filed a further affidavit of him in relation to his financial affairs. This included a statement of affairs that is about to be provided to the trustee and some other aspects of his financial position. I will come to that in a moment.

38    The second qualification and, more particular to this case, is that it is not a case about the putative bankrupt seeking to appeal against the debt that has made him bankrupt. There is no dispute that this interim interlocutory costs order is owing. Even if the appeal were fully successful, I do not understand it to be submitted that the order upon which the bankruptcy notice was founded would be set aside. Therefore, what one needs to posit is success in the appeal such that there will be an order for costs or may be an order for costs that would outweigh this amount. Mr Brady for ASIC says that cannot be shown in the material. I do not agree.

39    To the extent that there is an arguable case on the appeal and, in particular, to the extent that his Honour’s reasons for the three areas of default were, to a significant degree, interlocking, I think that there is an arguable case as to the appeal having grounds for success. If that be so, there inevitably would be, in my view, an arguable case for at least costs of the appeal being awarded. It may well be that if there are defects in the judgment that are not the fault of ASIC, the matter may be remitted to a trial judge with an order that the costs of the first hearing are determined by the second hearing. Nevertheless, if there was a significant success on the appeal, I do not see any reason why there would not be an order for costs. The appeal is likely to go for at least a week and there will be up to five parties. It will not be a cheap exercise. If costs are awarded against ASIC in Mr Hutchings’ favour, they are likely to exceed $50,000.

40    Let me say something more about Mr Hutchings’ financial position. He has been an executive in the finance industry for some years. If I may say so, with the utmost respect and not intending to say anything unnecessary, he is not a wealthy man. He now has few assets, other than a modest sum in superannuation. He was taxed in cross-examination by Mr Brady about a sale of a suburban house in Paddington two years ago for $3.3 million. He took a sum of $33,500 from that sale, being a so-called nominal one per cent share, the balance being owned by his wife.

41    It is not clear to me why the cross-examination proceeded as it did. Mr Hutchings’ answers indicated that his wife has a small business which he helps in, and that she came to the marriage with more assets than he did and that intermingling of assets was reflected in her predominant ownership of the family home which was sold in 2015.

42    Therefore, I am of the view that the primary judge made at least two errors of the kind that I have identified. A decision to set aside the sequestration order would not necessarily flow from that if I thought there was no utility in taking that step.

43    I appreciate that Mr Hutchings is not in a position to discharge the debt. His financial position, as stated in his affidavit, is that he is unemployed; basically, he has no assets other than the superannuation fund. He is 54 years of age. His wife has a business and she is to have received the residue after the bank payments of approximately $1 million from the Paddington house. Mr Hutchings is supported by his wife now; he does not engage in any commercial activity by way of undertaking risk and therefore I am satisfied from his affidavit of today that setting aside the sequestration order will not endanger creditors in the community, but it will enable him to prosecute the appeal in Queensland.

44    I appreciate that a trustee could prosecute the appeal on his behalf. However, the practical likelihood of that decision being taken by a trustee, and being exposed to costs and the other practical reasons from experience make the conclusion likely that the appeal would not go ahead. I return to the first remarks that I made about the relationship between solvency and the human importance of bankruptcy. In circumstances where I am persuaded that there is some arguability in the appeal – that it is arguable, I should say, whatever its prospects of success – the consequences of the orders and reasons were and are catastrophic to his participation in the commercial community and to his reputation.

45    His right of appeal should not be, in my view, denied in circumstances where the general body of creditors can be protected. I propose to do that by making orders that provide for an adjournment of the creditors’ petition subject to a degree of supervision by the Court in the appellate jurisdiction as to whether or not the adjournment should be dissolved. The petition was filed early this year and therefore needs to be dealt with within the statutory period and it may be, therefore, that the adjournment application needs to be revisited later this year with a view either to its dissolution or the dismissal of the petition.

46    It will not be within Mr Hutchings’ remit to control the speed of the Queensland appeal, but the conditions will require him to take all necessary steps expeditiously and to do what he can to bring the appeal on as quickly as possible. Further, the Court will accept the undertakings which are proffered in [26] of his affidavit sworn today, and there will be further conditions as to the provision to the Court of the material filed on his behalf in the prosecution of the appeal.

47    Therefore, the orders that I propose to make are:

1.    The appeal be allowed.

2.    Orders 1 and 2 made by the Federal Circuit Court (Judge Street) on 31 May 2017 be set aside.

3.    In lieu thereof, order that the hearing of the creditor's petition be adjourned subject to the following:

(a)    The undertakings to the Court which are given through counsel and set out in (a)-(d) of [26] in the affidavit of Mr Hutchings of 20 June 2017.

(b)    Mr Hutchings preparing written submissions in draft form that he intends to rely upon in the Queensland appeal by no later than 28 July 2017 and providing these to ASIC and the docket judge to whom this matter is referred.

(c)    Any consideration of the dissolution of the adjournment and otherwise any further relief in the appeal be remitted to Lee J, for any reconsideration that might be requested consequent upon the terms of the written submissions.

4.    Liberty to apply on 7 days’ notice.

5.    The respondent pay the appellant's costs of the appeal, to be assessed and payable forthwith.

6.    The costs of the appeal payable to the appellant be set-off against the amount of $50,983.76 owed by the appellant to the respondent that is the subject of the creditor’s petition.

7.    Costs before the Federal Circuit Court be reserved until final disposition of the creditor’s petition.

8.    Annexure GH1 to the affidavit of Guy Hutchings sworn 20 June 2017 not be made public on the Commonwealth Courts Portal or otherwise without an order of the Court.

Associate:

Dated:    28 July 2017