Federal Court of Australia

Ogbonna v CTI Logistics Limited [2021] FCA 1491

File number:

WAD 338 of 2019

Judgment of:

COLVIN J

Date of judgment:

29 November 2021

Catchwords:

BANKRUPTCY AND INSOLVENCY - application to set aside bankruptcy notice - where application relied upon existence of counterclaim, set-off or cross-demand being claim in defamation for damages - where defamation claim dismissed and attempts to appeal unsuccessful - where applicant now seeks to rely on claim of fraud, conspiracy and judicial corruption in rejection of defamation claim as basis to set aside bankruptcy notice - whether requirements of r 2.06 of Federal Court (Bankruptcy) Rules 2016 (Cth) should be dispensed with - where respondents provided submissions in accordance with case management orders instead of filing notice of grounds of opposition and supporting affidavit - application dismissed

Legislation:

Defamation Act 2005 (WA) s 28

Federal Court (Bankruptcy) Rules 2016 (Cth) r 2.06

Cases cited:

Boensch v Pascoe [2019] HCA 49; (2019) 268 CLR 593

CFB18 v Reader Lawyers & Mediators [2018] FCA 611

Ogbonna v CTI Logistics Ltd [2021] WASCA 25

Ogbonna v CTI Logistics Pty Ltd [2021] HCASL 122

Division:

General Division

Registry:

Western Australia

National Practice Area:

Commercial and Corporations

Sub-area:

General and Personal Insolvency

Number of paragraphs:

32

Date of hearing:

23 November 2021

Counsel for the Applicant:

The Applicant appeared in person

Counsel for the First and Second Respondents:

Mr CM Slater

Solicitor for the First and Second Respondents:

Jackson McDonald

Counsel for the Third Respondent:

The Third Respondent did not appear

ORDERS

WAD 338 of 2019

BETWEEN:

CELESTINE OGBONNA

Applicant

AND:

CTI LOGISTICS LIMITED (ACN 008 778 925)

First Respondent

MARK VANDERLIST

Second Respondent

TIM BARTON

Third Respondent

order made by:

COLVIN J

DATE OF ORDER:

29 NOVEMBER 2021

THE COURT ORDERS THAT:

1.    Further compliance by the first and second respondents with r 2.06 of the Federal Court (Bankruptcy) Rules 2016 (Cth) be dispensed with.

2.    The application to set aside the bankruptcy notice be dismissed.

3.    The applicant do pay the first and second respondents' costs of the application to be assessed by a registrar on a lump sum basis if not agreed.

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

REASONS FOR JUDGMENT

COLVIN J:

1    On 6 June 2019, a bankruptcy notice was issued notifying a claim by CTI Logistics Limited, Mr Mark Vanderlist and Mr Tim Barton (together, CTI Parties) against Mr Celestine Ogbonna. It relied upon failure by Mr Ogbonna to pay an amount of costs ordered to be paid by what was then the Federal Circuit Court.

2    Acting on his own behalf, Mr Ogbonna applied to set aside the bankruptcy notice. He did so within the prescribed period for such applications. His application relied upon his contention that he had a counterclaim, set-off or cross-demand being a claim in defamation for damages that had been commenced by Mr Ogbonna in the District Court of Western Australia.

3    The principles to be applied in dealing with an application to set aside a bankruptcy notice on the basis of an offsetting claim are well established. I summarised them in CFB18 v Reader Lawyers & Mediators [2018] FCA 611 at [32]-[36].

4    Since the commencement of the set aside application there have been repeated extensions of the time for compliance with the bankruptcy notice whilst Mr Ogbonna has pursued his defamation claim. The defamation claim was summarily dismissed by a judge of the District Court. An appeal against that decision to the Court of Appeal in Western Australia was unsuccessful: Ogbonna v CTI Logistics Ltd [2021] WASCA 25. An application for special leave to appeal to the High Court was refused: Ogbonna v CTI Logistics Pty Ltd [2021] HCASL 122.

5    Mr Ogbonna now maintains that there has been what he describes as fraud, conspiracy and judicial corruption in the consideration and rejection of his defamation claim by the courts (Claims). In particular, he says the judges of the Court of Appeal 'conspired and purposefully refused to determine the question of law and fact before the Court and by doing so perverted the course of justice'. He says this occurred when the judges of the Court of Appeal said at [58] of their reasons: '… we do not express any concluded view in relation to the construction of s 28 of the Defamation Act or these grounds of appeal'. The circumstances in which their Honours expressed that position are addressed below. Mr Ogbonna says the Claims give rise to an offsetting claim which should result in the bankruptcy notice being set aside.

6    Mr Ogbonna has now commenced separate proceedings in this Court against the CTI Parties in which he seeks to advance the Claims. In those separate proceedings he seeks declarations and orders requiring the payment of damages (being the amount claimed in the District Court proceedings for defamation) and interest. He also seeks an order requiring the publication of an apology.

7    So, having opposed the application to set aside the bankruptcy notice for some years on the basis of his claim for defamation, Mr Ogbonna now seeks to do so on the basis of the Claims as advanced in the proceedings recently commenced in this Court.

8    In accordance with case management directions made on the application to set aside the bankruptcy notice, the CTI Parties filed written submissions on 8 October 2021 setting out the basis upon which the application was opposed. Shortly stated, the basis was that the defamation proceedings had been heard, determined and dismissed with all avenues of appeal exhausted. As to the Claims, it was submitted that there was no basis in law or fact for them. Further, they were said to be allegations against parties other than the CTI Parties as they were directed to the actions of judicial officers.

9    Mr Ogbonna filed written submissions in response on 12 October 2021. He claimed to have established a plausible basis for the Claims. He relied upon three affidavits in the application and a further affidavit filed in the separate proceedings in which he sought to advance the Claims. No objection was taken to the reliance by Mr Ogbonna on the affidavit material save that it was said that it provided no foundation for the serious allegations made by Mr Ogbonna.

10    Mr Ogbonna also objected to the procedural steps taken by the CTI Parties. He said that they were required to comply with r 2.06 of the Federal Court (Bankruptcy) Rules 2016 (Cth) but had not done so. Rule 2.06 requires a person who intends to oppose an application, at least three days before the hearing of the application, or with the leave of the Court, at the hearing to file a notice of appearance, a notice (in accordance with the specified form) stating the grounds of opposition and an affidavit in support of the grounds.

11    A notice of appearance was filed by the first and second respondents (respondents). However, no notice stating the grounds of opposition in the required form and no affidavit had been filed by them. Rather, as has been noted, successive orders were made to extend the time for compliance with the bankruptcy notice whilst the court proceedings in relation to the defamation claim were being progressed. When those proceedings concluded, the respondents pressed to have Mr Ogbonna's application determined. Case management orders were made. The application was referred by a registrar of this Court to a judge. The position of the respondents is that they do not rely upon any affidavit evidence. They are content to make their submissions by reference to the matters stated in the affidavits of Mr Ogbonna.

12    Mr Ogbonna says that the reason that the respondents have not filed an affidavit in response to his application to set aside the bankruptcy notice is because, in order to do so, false accusations and perjury would have to be committed because, in effect, there is no honest answer to his Claims. There is no foundation for that claim. Mr Ogbonna has the onus on the application and his evidence is before the Court. If indeed it is sufficient to meet the required standard for demonstrating the existence of a counterclaim, set-off or cross-demand then he will succeed on his application. At most the failure by the CTI Parties to file an affidavit may enable inferences to be drawn, for present purposes, that might not be able to be drawn if there was an answering affidavit that contradicted the evidence of Mr Ogbonna. However, as has been stated, the respondents do not seek to contradict the facts advanced by Mr Ogbonna. Their position is that those facts do not establish an offsetting claim. In those circumstances, Mr Ogbonna is not disadvantaged in any way by the fact that there is no affidavit from the respondents. As matters stand the affidavit in response would be a document that contained no evidence because the position of the respondents is that they do not have any evidence to be advanced in opposition to the application.

13    Mr Ogbonna is also not disadvantaged by the fact that the grounds of opposition have been stated by the respondents in submissions (in accordance with the case management directions) rather than in a form of the kind required by the Rules. He was given adequate notice of the grounds and has had an opportunity to file his own written submissions and further affidavit evidence which he has done. No substantive purpose would be served by requiring further compliance with rule 2.06 and there is no evident injustice to Mr Ogbonna in proceeding to determine his application.

14    For those reasons, to the extent necessary, I will make an order formally dispensing with the requirements of r 2.06 to the extent that they have not been complied with by the respondents.

15    Both in oral submissions and in written submissions, the contentions of Mr Ogbonna focussed upon his claim that the Court of Appeal and the High Court should have dealt with an issue as to the construction of s 28 of the Defamation Act 2005 (WA) in determining whether his defamation claim had been properly dismissed by the District Court. It was the failure to do so that was articulated as the basis for the Claims.

16    The defamation claim advanced by Mr Ogbonna complained about the publication of certain statements in a judgment delivered by a Circuit Court judge in proceedings brought against the CTI Parties by Mr Ogbonna. In the Circuit Court proceedings Mr Ogbonna had claimed damages for alleged racial discrimination in the termination of his employment. The reasons of the Circuit Court judge quoted an extract from an email sent by an employee of CTI Logistics.

17    In his defamation proceedings in the District Court, Mr Ogbonna alleged that the republication of the contents of the email in the reasons which were then published on the internet by the Australasian Legal Information Institute was a republication for which CTI Logistics was vicariously liable.

18    CTI Logistics sought summary dismissal of the defamation proceedings. Two issues were identified on that application. First, could CTI Logistics be liable for a republication by the judge in reasons for decision? Second, if so, could CTI Logistics rely upon a defence that was open to the republisher under s 28 of the Defamation Act? In the District Court it was held that CTI Logistics could not be liable for the republication and further that the Defamation Act provided a complete defence.

19    On the appeal, Mr Ogbonna raised a number of grounds including actual bias. The claim of bias was dealt with in detail and was not accepted. The appeal grounds challenging the conclusion by the District Court on the first issue were not successful. On that basis, the Court of Appeal concluded that CTI Logistics could not be liable for the republication. The Court then went on to consider the remaining grounds raised by Mr Ogbonna to the effect that s 28 of the Defamation Act could not be relied upon. As to that aspect, the Court of Appeal reasoned as follows at [53]-[58]:

It is unnecessary for this court to resolve those grounds, as the first basis for entering summary judgment has been sustained. Success of the grounds challenging his Honour's conclusion that the respondents had a defence under s 28 of the Defamation Act could not therefore lead to the appeal being allowed.

Further, it seems to us to be undesirable for this court to express any concluded view in relation to the issue when it is not necessary to do so. The question is not one which is the subject of any significant prior judicial consideration. The fact that the appellant is self-represented means that the court does not have the benefit of submissions in support of the grounds which are as sophisticated as might be expected from a represented party.

In any event, consideration of the application of s 28 would have a hypothetical and artificial aspect to it in the present circumstances. The question of the availability of a defence under s 28 only arises in a case where the defendant would otherwise be liable for the publication which is the subject of the cause of action. In the present appeal, we have concluded that the respondents are not liable for the publication on AustLII's website on 24 February 2018. There is a degree of artificiality in considering the application of s 28 to circumstances where the respondents are not liable for the publication in any event.

Different questions may arise in a case where responsibility for republication is established. We see no reason to doubt Stavrianou DCJ's conclusion that the reference in s 28(3) to material being published is to the publication which is the subject of the cause of action and to which the defence is to apply. That is, in this case the question would be whether the publication on 24 February 2018 was not a publication honestly for the information of the public or the advancement of education. The appellant's argument based on the purposes for which the original publication was made on 21 July 2010 is without merit. However, in a case (unlike the present) where more than one party was responsible for the republication, questions may arise as to whose purpose is relevant under s 28(3) of the Defamation Act. It is undesirable for this court to attempt to deal with those questions of construction in a case where the application of s 28 does not arise because the respondents are not liable for the republication in any event.

Therefore, we do not express any concluded view in relation to the construction of s 28 of the Defamation Act or these grounds of appeal.

20    To reason in that way was entirely orthodox and commonplace. It was an approach to the issue that was not open to criticism in any way. The Court does not need to deal with every ground in an appeal. Where it is necessary for a party to succeed on both of two points in order to succeed then it is a matter for the appeal court as to whether it considers the second point in a case, like the present, where it has given detailed reasons as to the grounds concerning the first point are not upheld: Boensch v Pascoe [2019] HCA 49; (2019) 268 CLR 593 at [7]-[8].

21    Nevertheless, Mr Ogbonna maintained that the failure to consider the second point as to s 28 of the Defamation Act provided the foundation for the Claims. When asked to point to particular evidence to support the Claims he returned to that same contention. No other matter was identified to support the serious allegations that he raised in the most general of terms. Further, there is no other matter raised in the affidavits or submissions which might provide a foundation for the Claims.

22    It was apparent that Mr Ogbonna believes with some conviction that the point concerning s 28 of the Defamation Act should have been considered and that the failure to do so is evidence of some serious miscarriage of justice or impropriety. However, I must, with due respect, disagree with his position. The Court of Appeal has been transparent as to its approach. Its reasons have been subjected to scrutiny by two judges of the High Court who have found that Mr Ogbonna's application 'raises no reason to doubt the correctness of the decision of the Court of Appeal of the Supreme Court of Western Australia'. These steps have been taken in full public view with reasons being published.

23    There are other difficulties for the contention that the Claims provide a basis for a counterclaim, set-off or cross-demand. Most significantly, even if Mr Ogbonna's point about s 28 of the Defamation Act was found to be correct, the reasoning by the Court of Appeal would still apply to mean that there was no basis for his defamation claim. As his new claim to damages in this Court depends upon the contention that his defamation claim was wrongfully rejected, the causative basis for that contention could not be established. It is also a claim that did not exist as an offsetting claim at the time of the bankruptcy notice and there is a real question as to whether it may now be advanced for that purpose.

24    For those reasons, Mr Ogbonna has not demonstrated the existence of an offsetting claim that sounds in that might be pursued by him. Therefore, his application must be dismissed.

25    In the course of the hearing, Mr Ogbonna also raised concerns about the circumstances in which his application had been referred to a judge. He said that the registrar had done so on the basis that an application had been brought by the CTI Parties when that was not the case. He said that his attempts to obtain a transcript of the hearing had been thwarted. It is not necessary to deal with these matters because it is always open to a registrar to refer an application of the present kind to a judge. It was not necessary for such referral to be founded upon the existence of any particular application. Therefore, that matter is not a reason why a different conclusion should be reached.

26    After the hearing, Mr Ogbonna sent a letter to my chambers in which he said that he had serious concerns about the way in which the hearing of his application had been conducted. The letter was most respectfully expressed. It was copied to the solicitors for the respondents. Although it is the usual practice of the Court not to receive further submissions after the conclusion of a substantive hearing unless the Court has given leave for such submissions to be made, in view of the subject matter of the application and the fact that Mr Ogbonna acts on his own behalf, I propose to treat the letter as a further submission on the application.

27    In the letter, Mr Ogbonna says that he was stopped in the course of the hearing from reading from the reasons of the Court of Appeal which was a course that demonstrated bias on my part. It is the case that Mr Ogbonna was prevented from making further submissions in reply but only after he was afforded every reasonable opportunity to point to facts to support the Claims. It is the case that those Claims depend upon the reasons and Mr Ogbonna was seeking to read from the part of the reasons upon which he relied. However, that aspect, if I may say so, was well articulated in his written submissions and was a matter on which he had already addressed the Court. In these reasons I have endeavoured to explain why the reasons of the Court of Appeal do not support the contentions advanced by Mr Ogbonna.

28    In those circumstances, to the extent that the letter raises a claim of actual or apprehended bias based upon the manner in which the hearing was conducted, I do not accept that to be the case.

29    In his letter, Mr Ogbonna also objects to the fact that he was not been allowed to advance his summary judgment application in relation to the separate proceedings that he has commenced in this Court based on the Claims. Having regard to the nature of the present application and the fact that submissions had been made concerning the basis for the Claims, I determined that the appropriate course was to first deal with the present application and otherwise adjourn the hearing of the application in which Mr Ogbonna seeks to raise the Claims for case management once the outcome of the present application was known. I did so over the objection of both parties who had filed competing applications for summary dismissal. I did so in the interests of efficiency and in circumstances where it was the application to set aside the bankruptcy notice that was the pressing issue.

30    The letter otherwise deals with matters that have been addressed in these reasons or matters that, in my assessment, are not relevant to the application to set aside the bankruptcy notice.

31    In those circumstances, with due respect to Mr Ogbonna, I do not accept that the matters raised in the letter should lead to any different outcome on his application to set aside the bankruptcy notice. Therefore, I do not consider it necessary to afford to the respondents an opportunity to formally respond to the matters stated in the letter.

32    I will make orders as I have indicated in these reasons. As the respondents have succeeded in their opposition to the application there should be a further order that Mr Ogbonna bear the costs of the application to be assessed on a lump sum basis by a registrar if not agreed.

I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Colvin.

Associate:

Dated:    29 November 2021