Federal Court of Australia

Krejci in his capacity as liquidator of ENA Development Pty Ltd (in liq) v Sebie [2023] FCA 884

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 37AO(2)(b) of the Federal Court of Australia Act 1976 (Cth) the respondents, by themselves, their servants and agents, be prohibited from instituting any proceedings in the Federal Court of Australia, or filing any application or originating process in any existing proceedings in the Federal Court of Australia, either in their own name or in the name of any other person against any of the following:

(a)    the first applicant;

(b)    ENA Development Pty Ltd (in liq) (ACN 105 235 363);

(c)    any current or former director, employee, agent or consultant of the firm BRI Ferrier; and

(d)    any current or former director, employee, agent or consultant of ERA Legal,

relating to or in any way connected with the winding up of ENA Development Pty Ltd (in liq) (ACN 105 235 363), without first obtaining leave of this Court.

2.    Pursuant to s 37AO(2)(a) of the Federal Court of Australia Act 1976 (Cth) the following proceedings be permanently stayed:

(a)    Federal Court of Australia Proceeding NSD 912/2022; and

(b)    Federal Court of Australia, Full Court, Proceeding NSD 251/2023.

3.    The respondents pay the applicants’ costs in the lump sum of $23,188.50.

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

REASONS FOR JUDGMENT

JACKMAN J

1    This is an application pursuant to s 37AO of the Federal Court of Australia Act 1976 (Cth) (the FCA Act) seeking orders that the respondents be prohibited from instituting any proceedings in the Federal Court of Australia, or filing any application or originating process in any existing proceedings in the Federal Court of Australia, either in their own name or in the name of any other person, against either of the applicants, or any current or former director, employee, agent or consultant of the firm BRI Ferrier (the first applicant’s firm) or ERA Legal (the applicants’ solicitors), relating to or in any way connected with the winding up of ENA Development Pty Ltd (in liq) (ENA), without first obtaining leave of the Court. The applicants also seek orders staying or dismissing two Federal Court of Australia proceedings (NSD912/2022 and NSD251/2023).

2    The first applicant is Mr Peter Krejci in his capacity as liquidator of ENA (Liquidator). The second applicant is ENA itself, which was wound up by order of the Supreme Court of New South Wales on 27 February 2022.

3    There are five respondents. The first respondent, Mr Robert Sebie, was the sole director, secretary and shareholder of ENA when it was incorporated on 24 June 2003. The following day, Mr Sebie was replaced by his mother, Ms Rose Sebie, as the sole director of ENA, and his sister, Ms Raymonda Gayed, became the sole shareholder. Ms Gayed owns 99.6% of the issued shares in ENA.

4    The second respondent is Mr Ronald Jemmott. As well as being an alternate director and minority shareholder of ENA, Mr Jemmott is the sole director and sole shareholder of each of the third respondent, One T Development Pty Ltd (One T), and the fifth respondent, Enterprise INT Pty Ltd (Enterprise INT).

5    The fourth respondent is Enterprise ICT Pty Ltd (Enterprise ICT). Mr Sebie has been the sole director of that company since 19 August 2022. Before then, the directors were Ms Gayed and Mr Robert Sebie’s brother, Richard.

Salient Facts

6    Litigation in relation to ENA existed well before the Liquidator’s appointment. Proceedings were initially commenced in the Supreme Court of New South Wales by Mr and Mrs Pham against Mr Sebie in 2015. That litigation concerned a claim by Mr and Mrs Pham as purchasers to enforce a contract for the sale of land in Chiswick entered into between them and Mr Sebie, which Mr Sebie failed to complete, and the subsequent transfer of that property by Mr Sebie to Enterprise ICT (the Chiswick Specific Performance Proceedings).

7    That litigation led to further litigation. Ultimately, a number of costs orders were made against ENA and others. ENA failed to comply with those costs orders, and as a result, a statutory demand was issued. ENA failed to comply with that statutory demand, and Mr and Mrs Pham commenced winding up proceedings in the Supreme Court of New South Wales. Those proceedings were heard and determined on 27 January 2022. Despite ENA’s opposition to the application, ENA was wound up, and Mr Krejci was appointed as Liquidator. On 3 February 2022, the Liquidator commenced proceedings in the Supreme Court of New South Wales seeking an order appointing him as receiver of the assets of the ENA Development Trust (the Trust Proceedings).

8    Since the date of his appointment, the Liquidator has been the subject of numerous applications by each of the respondents. What follows is a brief summary of those applications.

9    During the period 7 to 14 August 2022, Mr Jemmott, Enterprise INT, Enterprise ICT, One T and others filed applications in the Supreme Court of New South Wales seeking orders, in effect, for the termination of the winding up of ENA, the replacement of the Liquidator, and declarations about the purported appointment of One T as trustee of various trusts.

10    The first of those applications, filed on 7 August 2022 in the Trust Proceedings, was dismissed by consent on 10 August 2022. On 12 August 2022, a motion in almost identical form was served. Despite the associate to Black J raising by email on 12 August 2022 with those parties the question of whether or not the motion should be dismissed as an abuse of process, on 14 August 2022, a further interlocutory process was filed in relevantly identical terms. Once again, the associate to Black J invited those parties to make submissions as to why that motion should not be dismissed as an abuse of process. None were made.

11    Ultimately, on 15 August 2022, and after having sought that the 14 August 2022 motion be re-enlivened (having been dismissed by the Supreme Court of New South Wales earlier that day), the Supreme Court of New South Wales granted leave to Mr Jemmott, Enterprise INT and Enterprise ICT and others to discontinue the 14 August 2022 interlocutory process. The grant of leave was on the basis of an undertaking given by each of One T and the applicants by their counsel not to bring a further application, interlocutory process or notice of motion, in or substantially in the form of certain paragraphs of the interlocutory process filed on 14 August 2022.

12    Despite that undertaking, further applications seeking the same relief were filed. I note at this point that, although Mr Sebie was not party to those applications, on 17 August 2022 the solicitor for those applicants ceased to act, and listed as a contact email for those parties the email address “robert.sebie@hotmail.com”.

13    On 16 August 2022, Mr Jemmott commenced proceedings in the Federal Court (the First Jemmott Federal Court Proceedings), and on 25 August 2022 filed an interlocutory process, in both of which he sought relief in substantially the same form as that sought less than a week earlier in the Supreme Court. On 15 September 2022, Mr Sebie sought to appear at a case management hearing in those proceedings. On 21 September 2022, those proceedings were transferred to the Supreme Court of New South Wales: Jemmott v ENA Development Pty Ltd (in liq) (Receiver Appointed) [2022] FCA 1134.

14    On or about 31 August 2022, Mr Sebie filed a Notice of Motion in the Trust Proceedings in the Supreme Court seeking, among other things, orders that he be joined to those proceedings and a declaration that certain land in Homebush (the Homebush Property) was a trust asset, claiming that he and his brother, Richard, were beneficially entitled to that property. On 21 October 2022, that motion was dismissed.

15    On 25 October 2022, an application was filed by One T in proceedings in the Federal Circuit and Family Court of Australia, seeking, among other things, orders in part similar to those sought in the applications made in the Supreme Court of New South Wales in mid-August 2022.

16    Also on 25 October 2022, One T commenced proceedings in the Court of Appeal of the Supreme Court of New South Wales, seeking leave to appeal against the order winding up ENA on 27 January 2022, the judicial directions given to the Liquidator as part of the Trust Proceedings as to ENA having the beneficial interest in the Homebush Property and certain other assets, and the grant of possession to the Liquidator of that property (the 2022 Appeal Proceedings). Leave to appeal was granted on 8 February 2023, but the appeal was dismissed on 2 June 2023: One T Development Pty Ltd v Krejci [2023] NSWCA 120. On 17 February 2023, One T filed a notice of motion seeking a stay of the judicial directions, which was dismissed by Macfarlan JA on 20 February 2023.

17    On 26 October 2022, Mr Sebie commenced proceedings in the Federal Court (the Sebie Federal Court Proceedings), seeking, amongst other things, orders for the termination of the winding up of ENA. A number of claims for relief in that originating process were the same as those sought by Mr Jemmott in the First Jemmott Federal Court Proceedings, which in turn were the same as those sought in the mid-August 2022 applications in the Supreme Court of New South Wales. Mr Sebie then filed an interlocutory process in those proceedings, seeking a stay of the winding up of ENA and other relief. That interlocutory process was dismissed on 2 November 2022. The originating process was dismissed on 16 November 2022, and Mr Sebie was ordered to pay the Liquidator’s and ENA’s costs on a party and party basis up to 2 November 2022, and thereafter on the indemnity basis.

18    On 11 November 2022, following an application by the Liquidator for possession of the Homebush Property, the Supreme Court of New South Wales issued a writ of possession in respect of that property.

19    On 6 December 2022, Mr Sebie filed an interlocutory process in the Federal Court seeking a stay and review of the orders dismissing his interlocutory and originating processes, together with further relief. That application was heard on 13 February 2023, and directions were made for the filing of any further application following determination of the proceedings in the Federal Circuit and Family Court of Australia. Those proceedings still await determination. In dismissing Mr Sebie’s interlocutory process, Lee J observed that the evidence currently before the Federal Court was manifestly deficient: Sebie v ENA Development Pty Ltd (in liq) (Receiver Appointed) (No 2) [2023] FCA 141 at [23]. Lee J also referred to “the orgy of litigation which seems to have arisen in relation to the liquidation of ENA”: at [2].

20    From 22 December 2022, Mr Sebie, Mr Jemmott, One T, Enterprise INT and Enterprise ICT filed applications in the Supreme Court of New South Wales, and the Court of Appeal, seeking orders to the effect that there be a stay of the exercise of the writ of possession in respect of the Homebush Property, then scheduled to be executed on 9 January 2023. An application filed by Mr Jemmott, One T and Enterprise INT (in which Mr Sebie sought to appear) in the Supreme Court of New South Wales was heard and dismissed on 6 January 2023. That evening, Mr Sebie approached Goodman J, sitting as duty judge in the Federal Court, and sought a stay of the winding up of ENA. That application was dismissed, with Goodman J noting that the application was in substance a second attempt to obtain a stay of the writ of possession, albeit by different means: Sebie v ENA Development Pty Ltd (in liq) (Receiver Appointed) [2023] FCA 2 at [22].

21    Notwithstanding the dismissal of the application for a stay in the Supreme Court of New South Wales, and the application seeking similar relief in the Federal Court, Messrs Sebie and Jemmott, together with Enterprise INT, Enterprise ICT and One T, made a number of further applications, both formally and informally, seeking to have that application relisted. Attempts to that end were made on 16, 18, 19, 20 and 21 January 2023. Ultimately, an application for an adjournment made by the solicitor then appearing for those parties was refused, and no attempt was made to move on the amended motion seeking a stay.

22    On 20 January 2023, Mr Jemmott commenced further proceedings in the Federal Court (the Second Jemmott Federal Court Proceedings) seeking relief which was, at least in part, substantially the same as that sought in his earlier proceedings in the Federal Court, the mid-August motions in the Supreme Court of New South Wales, and the Sebie Federal Court Proceedings. Those proceedings were heard on 8 February 2023, and were dismissed as an abuse of process, with Mr Jemmott ordered to pay costs on the indemnity basis in a fixed sum. Mr Sebie was present in Court, and appeared to be the person primarily providing instructions to the solicitor then appearing for Mr Jemmott. On 6 March 2023, Mr Jemmott commenced an application for extension of time and leave to appeal against those orders (the Federal Court Appeal Proceedings).

23    What I have set out above is an abbreviated summary of proceedings brought by the respondents. As the Liquidator has set out in his affidavit, in each of those proceedings there were a number of other interlocutory appearances, steps taken or applications filed. The Liquidator gives evidence that since May 2022, 17 costs orders have been made against one or more of the respondents in those proceedings, none of which has been paid. The Liquidator also refers to the fact that Mr Sebie is subject to the following vexatious proceedings orders:

(a)    Henderson J made an order pursuant to the Family Law Act 1975 (Cth) prohibiting Mr Sebie from instituting proceedings under that Act without first having been granted leave: Munayallan v Scott (No 5) [2021] FedCFamC1F 284; and

(b)    Rothman J in the Supreme Court of New South Wales made an order pursuant to the Vexatious Proceedings Act 2008 (NSW) (the VP Act) prohibiting Mr Sebie from instituting proceedings relating to or in any way connected to the sale of a property in Chiswick: Sebie v Bresic Whitney Balmain Pty Ltd [2022] NSWSC 816.

24    Most importantly, on 15 May 2023, Williams J in the Supreme Court of New South Wales made orders pursuant to the VP Act against the current respondents which are substantially similar to the orders sought against the same parties in these proceedings. I turn next to that topic.

Findings by Justice Williams

25    On 15 May 2023, Williams J gave detailed and thorough reasons for judgment in Re ENA Development (in liq) [2023] NSWSC 503. The plaintiffs were Mr Krejci as Liquidator and ENA. The defendants were the same as the five respondents in these proceedings. The proceedings sought orders pursuant to the VP Act in substantially similar terms to the present proceedings.

26    After making detailed findings concerning the conduct of various proceedings involving the defendants, Williams J set out a list of the proceedings which were alleged to have been vexatious within the meaning of s 6 of the VP Act. There were thirteen such proceedings: [263]. Three of them were found not to have been proceedings, or proceedings instituted and conducted by any of the defendants, thereby leaving ten proceedings. Her Honour’s ultimate findings in relation to those ten proceedings were as follows.

27    The first related to a notice of motion filed by Mr Sebie on 30 May 2022, and amended on 15 August 2022, seeking an order that the orders made by Sackar J in the Chiswick Specific Performance Proceedings on 22 April 2022 be stayed and set aside. Williams J did not accept the plaintiffs’ submission that that notice of motion was an abuse of the process of the Court or that the motion was instituted without reasonable ground: at [267]-[268]. However, her Honour accepted the plaintiffs’ submissions that the motion was conducted in a way that caused detriment to them: [269]. Her Honour found that the motion was conducted in a way that caused unreasonable detriment to the plaintiffs by causing them to incur costs for a hearing which were then wasted due to Mr Sebie’s inexplicable conduct in declining to press his motion at that hearing: [270]. Her Honour found that Mr Sebie did not seriously intend to prosecute his motion to hearing, notwithstanding the evidence with which he had burdened the plaintiffs: [270]. For that reason, the motion was a vexatious proceeding within the meaning of s 6(1)(d) of the VP Act: [270].

28    Williams J then dealt with the amended notice of motion filed in the Trust Proceedings on 7 August 2022 by several parties including Mr Jemmott, One T, Enterprise INT and Enterprise ICT which was dismissed on 10 August 2022. Her Honour found that Mr Sebie acted in concert with Mr Jemmott, One T, Enterprise INT and Enterprise ICT in the filing of that amended notice of motion: [275]. Her Honour found that the motion was instituted without reasonable grounds, and accordingly that it was a vexatious proceeding: [280].

29    As to the interlocutory process filed in the Trust Proceedings on 14 August 2022 by Mr Jemmott, One T, Enterprise INT and Enterprise ICT and others, her Honour found that that interlocutory process was instituted without reasonable ground and was therefore a vexatious proceeding: [288].

30    As to the First Jemmott Federal Court Proceedings, her Honour found that Mr Sebie acted in concert with Mr Jemmott in relation to the institution and conduct of those proceedings: [290]. Her Honour found that those proceedings were an abuse of process: [292]-[293]. Her Honour also found that the proceedings were instituted to harass or annoy, or to cause delay or detriment to, the plaintiffs: [293]. Accordingly, her Honour found that the First Jemmott Federal Court Proceedings were vexatious proceedings: [294].

31    As to the notice of motion filed by Mr Sebie in the Trust Proceedings on 31 August 2022 (as amended on 26 September 2022), her Honour found that the motion was an abuse of the process of the Supreme Court: [297]. Further, her Honour found that the motion was conducted in a way that harassed, or caused unreasonable annoyance, delay or detriment to, the plaintiffs: [298]. Accordingly, her Honour found that the notice of motion was a vexatious proceeding: [299]. Her Honour also found that the motion was brought without reasonable ground: [302].

32    As to the Sebie Federal Court Proceedings, her Honour found that those proceedings were an abuse of process: [307]. Her Honour also found that those proceedings were commenced without reasonable ground: [309]. Accordingly, her Honour found that the Sebie Federal Court Proceedings were vexatious proceedings: [310].

33    Her Honour then dealt with the stay motion that was instituted by notice of motion filed in the Trust Proceedings on 22 December 2022 by Mr Jemmott, Enterprise INT and One T, and heard on 6 January 2023. Her Honour found that the stay motion was an abuse of process: [313]. Accordingly, her Honour found that the stay motion was a vexatious proceeding: [314].

34    Her Honour then dealt with Mr Sebie’s application made on an urgent basis in the Sebie Federal Court Proceedings on 6 January 2023. Her Honour found that the application was an abuse of process and was commenced without reasonable ground, and accordingly was a vexatious proceeding: [318].

35    As to the Second Jemmott Federal Court Proceedings, her Honour found that Mr Sebie acted in concert with Mr Jemmott in the institution and conduct of those proceedings: [322]. Her Honour found that those proceedings were an abuse of process and were commenced without reasonable grounds: [324].

36    Finally, her Honour dealt with the notice of motion filed by One T on 17 February 2023 in the 2022 Appeal Proceedings, seeking a stay of orders made by Stevenson J in the Trust Proceedings on 11 July 2022. Her Honour found that Mr Sebie acted in concert with One T in instituting and conducting that application: [326]. Her Honour found that the application was conducted in a way that harassed or caused unreasonable annoyance and detriment to the Liquidator, and accordingly found that the application was a vexatious proceeding: [328].

37    Her Honour then turned to the question whether each defendant had frequently instituted or conducted vexatious proceedings in Australia. As to Mr Sebie, her Honour found that he had frequently instituted or conducted vexatious proceedings in Australia, and had also instituted or conducted vexatious proceedings in Australia acting in concert with the other defendants: [333]. Her Honour also found that Mr Jemmott, One T, Enterprise ICT and Enterprise INT had each frequently instituted or conducted vexatious proceedings in Australia: at [336], [339], [342] and [345] respectively.

38    Her Honour then dealt with the question whether vexatious proceedings orders should be made in respect of any or all of the defendants. Her Honour concluded that the orders sought by the plaintiff should be made to the effect that the defendants be prohibited from instituting any proceedings in New South Wales, or filing any application, interlocutory process, or notice of motion in any existing proceedings in New South Wales, either in their own name or in the name of any other person against:

(a)    the Liquidator;

(b)    ENA;

(c)    any current or former director, employee, agent, or consultant of the Liquidator’s firm BRI Ferrier; and

(d)    any current or former director, employee, agent, or consultant of the plaintiffs’ solicitors in those proceedings, ERA Legal,

relating to or in any way connected with the winding up of ENA, without first obtaining leave of the Court: [349].

39    The present proceedings were commenced on 23 May 2023, being eight days after Williams J delivered judgment. In essence, the present proceedings seek a vexatious proceedings order against the same parties to prohibit them from instituting any proceedings in the Federal Court, noting that the orders made by Williams J apply only to proceedings in New South Wales, being the limit of the power conferred by the VP Act.

Relevant Legislative Provisions

40    Section 37AO of the FCA Act provides relevantly as follows:

(1)    This section applies if the Court is satisfied:

(a)     a person has frequently instituted or conducted vexatious proceedings in Australian courts or tribunals; or

(b)    a person, acting in concert with another person who is subject to a vexatious proceedings order or who is covered by (a), has instituted or conducted a vexatious proceeding in an Australian court or tribunal.

(2)    The Court may make any or all of the following orders:

(a)    an order staying or dismissing all or part of any proceedings in the Court already instituted by the person;

(b)    an order prohibiting the person from instituting proceedings, or proceedings of a particular type, in the Court;

(c)    any other order the Court considers appropriate in relation to the person.

…

(4)    The Court must not make a vexatious proceedings order in relation to a person     without hearing the person or giving the person an opportunity of being heard.

(5)    An order made under paragraph (2)(a) or (b) is a final order.

41    The following relevant definitions appear in s 37AM(1) of the FCA Act:

Australian court or tribunal means a court or tribunal of the Commonwealth, a State or a Territory.

institute, in relation to proceedings, includes:

(a)    for civil proceedings – the taking of a step or the making of an application that may be necessary before proceedings can be started against a party; and

…

(d)    for civil or criminal proceedings or proceedings before a tribunal – the     taking of a step or the making of an application that may be necessary     to start an appeal in relation to the proceedings or to a decision made     in the course of the proceedings.

proceeding:

(a)    in relation to a court – has the meaning given by section 4 [which is     expressed to include “an incidental proceeding in the course of, or in     connexion with, a proceeding, and also includes an appeal”] ….

vexatious proceeding includes:

(a)    a proceeding that is an abuse of the process of a court or tribunal; and

(b)    a proceeding instituted in a court or tribunal to harass or annoy, to cause delay or detriment, or for another wrongful purpose; and

(c)    a proceeding instituted or pursued in a court or tribunal without reasonable ground; and

(d)    a proceeding conducted in a court or tribunal in a way so as to harass or annoy, cause delay or detriment, or achieve another wrongful purpose.

vexatious proceedings order means an order made under subsection 37AO(2).

42    Section 37AR(2) provides that a person who is subject to a vexatious proceedings order prohibiting the person from instituting proceedings, or proceedings of a particular type, in the Court, or who is acting in concert with another person who is subject to such an order, may apply to the Court for leave to institute a proceeding that is subject to the order.

43    The VP Act (being the legislation applied by Williams J) contains a number of provisions which are relevantly to the same effect as the FCA Act. Section 8(1) of the VP Act is relevantly to the same effect as s 37AO(1) of the FCA Act. Section 8(3) of the VP Act is relevantly to the same effect as s 37AO(4) of the FCA Act. Section 8(7) of the VP Act is relevantly to the same effect as s 37AO(2) of the FCA Act. Section 4 of the VP Act defines “proceedings” as including any interlocutory proceedings or applications, or procedural applications, taken in connection with or incidental to civil proceedings, and “any calling into question of a decision, whether or not a final decision, of a court or tribunal, and whether by appeal, challenge, review or in any other way”. That definition reflects the substance of its counterpart in s 4 of the FCA Act. Section 6 of the VP Act defines “vexatious proceedings” in substantially the same way as the definition in s 37AM(1) of the FCA Act, except that in relation to paragraph (d), the VP Act was amended in 2018 by the Vexatious Proceedings Amendment (Statutory Review) Act 2018 (NSW) to add the words “regardless of the subjective intention or motive of the person who instituted the proceedings”.

44    The VP Act provides in s 9 that a vexatious proceedings order under s 8 may be varied or set aside. The VP Act does not contain a counterpart to s 37AO(5) as to an order staying or dismissing all or part of any proceedings already instituted, or prohibiting the person from instituting proceedings or proceedings of a particular type, being a “final order”. Section 37AO does not provide expressly that a vexatious proceedings order may be varied or set aside, in contrast to s 9 of the VP Act. I consider the significance, if any, of those particular differences below in connection with the question of the finality of a vexatious proceedings order for the purposes of issue estoppel.

Issue Estoppel

45    The primary position advanced by Mr Rose, counsel for the applicants, is that the parties are bound by issue estoppels as to the questions whether the earlier proceedings found by Williams J to be vexatious were in fact vexatious proceedings for the reasons given, whether the respondents had frequently instituted or conducted vexatious proceedings in Australian courts or tribunals, and whether Mr Sebie acted in concert with another such person. An issue estoppel operates to preclude the raising in a subsequent proceeding of an ultimate issue of fact or law which was necessarily resolved as a step in reaching the determination made in the judgment: Tomlinson v Ramsey Food Processing Pty Ltd [2015] HCA 28; (2015) 256 CLR 507 at [22] (French CJ, Bell, Gageler and Keane JJ). There are three requirements for the doctrine of issue estoppel to apply, namely (1) that the same question has been decided; (2) that the judicial decision which is said to create the estoppel was final; and (3) that the parties to the judicial decision or their privies were the same persons as the parties to the proceedings in which the estoppel is raised or their privies: Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363 at [21] (Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ).

46    The third of those requirements is clearly satisfied, as the plaintiffs and defendants in the proceedings before Williams J are exactly the same persons and entities as the applicants and respondents in the proceedings before me.

47    As to the first of those requirements, both proceedings raise the same issues as to whether the earlier proceedings were “vexatious proceedings”, and whether the defendants had “frequently” instituted or conducted such proceedings (and in the case of Mr Sebie the additional issue of whether he acted in concert with another such person). The ten proceedings which Williams J found to have been vexatious proceedings are the same as the proceedings which the applicants rely upon before me.

48    I have referred above to the slight difference in the definition of “vexatious proceedings” between the two pieces of legislation, being the way in which paragraph (d) of that definition is expressed. In s 37AM(1) of the FCA Act, paragraph (d) is expressed as “a proceeding conducted in a court or tribunal in a way so as to harass or annoy, cause delay or detriment, or achieve another wrongful purpose”. In s 6 of the VP Act, paragraph (d) is expressed as “proceedings that are conducted to achieve a wrongful purpose, or in a way that harasses, or causes unreasonable annoyance, delay or detriment, regardless of the subjective intention or motive of the person who instituted the proceedings”. Paragraph (d) was relied on by Williams J in only three of the ten previous proceedings, namely the notice of motion in the Chiswick Specific Performance Proceedings, the motion filed by Mr Sebie in the Trust Proceedings on 31 August 2022, and the motion filed by One T on 17 February 2023 in the 2022 Appeal Proceedings. The issue raised and decided as to the application of paragraph (d) to those three proceedings did not raise for consideration any difference in the language between the two statutory definitions of “vexatious proceedings”, and there was no materiality for the purpose of the issue actually raised before Williams J in those differences in language. Accordingly, the same issue as to the application of paragraph (d) of the definitions arose in both proceedings.

49    As to the other findings by Williams J concerning the earlier proceedings, there is no difference in the statutory language of the two definitions concerning abuse of process in paragraph (a), and the lack of reasonable ground in paragraph (c). There is no difference in the requirement of frequency laid down in s 37AO(1) of the FCA Act and s 8(1) of the VP Act. Accordingly, I accept the applicants’ submission that the same question has been decided in the earlier proceedings before Williams J.

50    I turn then to the question whether the decision by Williams J, which is said to create the estoppel, was final. I have referred above to the fact that the VP Act does not contain a counterpart to, or equivalent of, s 37AO(5) of the FCA Act dealing with the finality of certain orders. I note that the provision was the subject of consideration by the Full Court in Fuller v Toms [2015] FCAFC 91; (2015) 234 FCR 535 at [7]-[19] (Besanko, Logan and McKerracher JJ). Further, as I have noted, the VP Act contains a provision in s 9 to the effect that a vexatious proceedings order may be varied or set aside. Section 9(1) provides simply that:

An authorised court may, by order, vary or set aside a vexatious proceedings order that the court has made.

51    The High Court in Kuligowski v Metrobus dealt with the question of assessing finality where the order made pursuant to the judgment in question can later be altered. At [25], the Court referred to Somodaj v Australian Iron and Steel Limited (1963) 109 CLR 285 at 297-298, in which Kitto, Taylor and Menzies JJ approved the statement of Isaacs J in Ainslie v Ainslie (1927) 39 CLR 381 at 390 that:

The true rule is to see whether or not the Legislature has by its enactment left the order entirely floating, so to speak, as a determination enforceable only as expressly provided and in the course of that enforcement subject to revision, or whether the order has been given the effect of finality unless subsequently altered.

Their Honours held that the legislation in question before them plainly fell within the latter category, and thus was a final decision, being an adjudication upon the rights of the parties not of an interlocutory character, but completely effective unless and until it should be rescinded, altered or amended by the Workers’ Compensation Commission. The unanimous High Court in Kuligowski v Metrobus referred at [32] to the defining feature of a final decision being “complete effectiveness unless and until it can be amended”. In the context of the legislation dealt with in that case, the High Court pointed out that the legislative goal of having workers’ compensation disputes heard and determined in an informal, quick and cheap manner would not be assisted by a construction of the legislation which prevented the doctrine of issue estoppel from ever applying, and such a construction would increase the chance of double litigation of issues and vexation of parties: [32].

52    In my opinion, that reasoning applies with at least as much force to the vexatious proceedings orders made by Williams J pursuant to s 8 of the VP Act. Those orders are completely effective unless and until an application is made subsequently to vary or set aside those orders pursuant to s 9. That conclusion follows from the plain language of ss 8 and 9 of the VP Act when read together, as a variation or setting aside of vexatious proceedings orders pursuant to s 9 could only take place subsequently to the making of those orders under s 8, and in a separate application. Further, it would be an odd result if legislation which is designed to protect parties from the re-litigation of issues and other kinds of vexatious litigation were construed as preventing the doctrine of issue estoppel from ever applying, thereby increasing the prospect of re-litigation and vexation. Accordingly, in my view, the orders made by Williams J pursuant to s 8 of the VP Act were final orders for the purpose of the doctrine of issue estoppel.

53    I note, however, that there is a very substantial body of case law concerning the question whether vexatious proceedings orders are final orders in the context of the different question whether there is a right of appeal from such orders, as distinct from a party needing leave to appeal in order to institute an appeal from such orders. In Pedler v Hunters Hill Municipal Council [1976] 2 NSWLR 411 at 414, Reynolds JA (with whom Moffitt P and Samuels JA agreed) held that an order made under the former s 84(2) of the Supreme Court Act 1970 (NSW), prohibiting a person from instituting any legal proceedings against a municipal council in a State Court without the leave of the Court, was a final order, being an independent proceeding in which past events had to be established, and unrelated to any main matter in issue or in dispute between the parties. That reasoning was criticised by the Victorian Court of Appeal in Kay v Attorney-General [2000] VSCA 176; [2000] 2 VR 436 at [35] on the basis that Reynolds JA did not take into account s 84(3), which conferred on the Court the power to vary or set aside an order made under s 84(2). The Victorian Court of Appeal thought that Pedler was distinguishable on that basis, a proposition that was rightly criticised by the New South Wales Court of Appeal in Klewer v Attorney-General (NSW) [2010] NSWCA 219 at [16]. The Court of Appeal in the latter case was able to reach a conclusion by a route which neither endorsed nor disapproved the aspect of Pedler that related to the decision below being final: [22]. There has then followed a series of decisions which refer to the issue whether a grant of leave is necessary to appeal against orders under the VP Act, but without deciding the specific issue whether such leave was required by reason of the order being interlocutory within the meaning of s 101(2)(e) of the Supreme Court Act 1970 (NSW), as distinct from s 101(2)(r) concerning final orders where the amount at stake is not more than $100,000: Potier v Attorney-General (NSW) [2015] NSWCA 129; (2015) 89 NSWLR 284 at [47]-[49] (Leeming JA, with whom Basten and Meagher JJA relevantly agreed); Viavattene v Attorney-General (NSW) [2014] NSWCA 218 at [2] (Basten JA, with whom Tobias AJA agreed); Viavattene v Attorney-General (NSW) [2015] NSWCA 44 at [30] (Leeming JA); Mahmoud v Attorney-General (NSW) [2017] NSWCA 12 at [7] (Payne JA, with whom Beazley P and Macfarlan JA agreed); Zepinic v Chateau Constructions (Australia) Limited [2018] NSWCA 317 at [6] (Simpson AJA, with whom McColl and Macfarlan JJA agreed); Batterham v Nauer [2020] NSWCA 204 at [8] (Simpson AJA, with whom Macfarlan and Payne JJA agreed).

54    All those cases concerned the question whether leave to appeal was required from vexatious proceedings orders under the VP Act or cognate legislation, as distinct from a question concerning issue estoppel. The question whether leave to appeal is required is properly a matter for the Court of Appeal of the Supreme Court of New South Wales to determine, and nothing that I say in these reasons should be taken as intended to have any bearing on that question. It is conceivable that the question whether a vexatious proceedings order is final may differ according to the context in which the question arises, although I say that only as a matter of possibility and without expressing any opinion on the question. As I have indicated above, there is a strong reason in principle for applying the doctrine of issue estoppel to judgments pertaining to vexatious proceedings orders, in order to prevent the very prospect of re-litigation of issues and vexation of parties which the legislation is designed to avoid. By contrast, in the context of leave to appeal, there may be some attraction in the view that such orders are interlocutory, because that then gives rise to a requirement for leave to appeal from a vexatious proceedings order and thus provides an appellate court with a means of controlling the institution of appeals, taking into account the need to avoid the vexation of parties. Such a requirement may be all the more significant in view of the position taken by the New South Wales Court of Appeal that an appeal brought by the person who is subject to the vexatious proceedings order is not itself subject to the operation of the VP Act: Potier v Attorney-General (NSW) at [49]. I note that a different position was adopted by the Full Federal Court in Fuller v Toms at [16]-[18]. The reasoning in Fuller v Toms proceeds on the basis that a vexatious proceeding order (by way of stay, dismissal or prohibition) is a final order, but a filter mechanism is still provided for any appeal by reason of the need for the person seeking to challenge that order to obtain the Court’s leave (under s 37AR(2) of the FCA Act or under the terms of the order) to institute such a proceeding. It may be that a court in a future case will need to consider the apparent inconsistency between those two decisions, bearing in mind that Potier was decided on 13 May 2015, after the argument in Fuller v Toms had concluded, but about a month before judgment was delivered on 26 June 2015.

55    For the purposes of issue estoppel, I am bound to apply the reasoning of the High Court in Kuligowski v Metrobus. Accordingly, my view that the vexatious proceedings orders made by Williams J were final orders is not affected by the continuing uncertainty as to the basis on which leave to appeal is required in New South Wales from orders pursuant to s 8 of the VP Act.

56    The result is that all three requirements of the doctrine of issue estoppel are satisfied in the present case, and the parties are thereby bound by the relevant findings of Williams J. It remains only to exercise the discretion pursuant to s 37AO(2). Before I do so, however, there are two alternative bases on which the applicants submit the elements of s 37AO(1) are established.

The Applicants’ Alternative Submissions

57    First, Mr Rose submits that if the doctrine of issue estoppel does not apply (for example, if I were to have concluded that the vexatious proceedings orders made by Williams J were not final orders), then it would be an abuse of process for the respondents to contest the findings made by Williams J as to the vexatious nature of the earlier proceedings and the frequency of them, and of Mr Sebie acting in concert with the other defendants. The relevant principle is that recognised in Reichel v Magrath (1889) 14 App Cas 665, in which the House of Lords held that a defence which was not barred by res judicata estoppel may nevertheless be struck out as an abuse of process. Lord Halsbury LC said (at 668):

… it would be a scandal to the administration of justice if, the same question having been disposed of by one case, the litigant were to be permitted by changing the form of the proceedings to set up the same case again… there must be an inherent jurisdiction in every Court of Justice to prevent such an abuse of its procedure…

That reasoning was approved by Mason CJ, and Deane and Dawson JJ, in Walton v Gardiner (1993) 177 CLR 379 at 393, stating the principle (as applicable where the party abusing the process of the court is the moving party in the proceedings) as follows:

proceedings before a court should be stayed as an abuse of process if, notwithstanding that the circumstances do not give rise to an estoppel, their continuance would be unjustifiably vexatious and oppressive for the reason that it is sought to litigate anew a case which has already been disposed of by earlier proceedings.

In Rogers v The Queen (1994) 181 CLR 251 at 287, McHugh J stated the principle in similar terms.

58    The principle is often applied in cases where the doctrines of res judicata and issue estoppel are not applicable because of a difference in the identity of the parties. That was the case, for example, in Rippon v Chilcotin Pty Ltd [2001] NSWCA 142; (2001) 53 NSWLR 198. In that case, Handley JA (with whom Mason P and Heydon JA agreed) made a detailed examination of the authorities and the relevant factors to be taken into account in applying this principle of abuse of process. That reasoning makes clear that the issue determined in the earlier case must be one on which the party propounding it in the latter case had previously lost, and that issue must be precisely identified: [31] and [33]. As I have indicated, the relevant issues in the present case are the same as those decided by Williams J. It is also important to examine the opportunity available and taken to fully litigate the issue: [32]. I note in that regard that Mr Sebie appeared in person before Williams J and argued the matter fully in his own interest, which necessarily encompassed the position of the other defendants. Although those other defendants did not appear, they had every opportunity of doing so. However, it is not an essential requirement for this species of abuse of process that the issue must have been a final one. At [31], this is described as the normal circumstance, and at [32], the finality of the finding as to the issue is stated as no more than a matter to which regard may be had. Accordingly, if, contrary to my reasoning above, the vexatious proceedings orders made by Williams J were to be found not to have been final orders, then that is a matter to be taken into account in applying the doctrine of abuse of process, but is not in itself determinative. If those orders were not final orders and the steps leading to those orders were not findings of a final nature, then they were certainly important matters on which Williams J expressed clear conclusions after lengthy debate and analysis in self-contained proceedings. The issues were substantive issues, not merely evidentiary or procedural ones. Accordingly, if I had not formed the view that an issue estoppel arose in the present case, then I would have concluded that it would be an abuse of process for any of the respondents to contest the findings of Williams J to which I have referred.

59    I note that the reasoning in Rippon v Chilcoti    n Pty Ltd has subsequently been approved by the Court of Appeal: Liao v New South Wales [2014] NSWCA 71 at [169]-[172] (Barrett JA, with whom Beazley P agreed); Benton v QBE Workers Compensation (NSW) Ltd [2015] NSWCA 101 at [5]-[7] (Meagher JA), [90] (Adamson J).

60    Second, as an ultimate fall-back, Mr Rose submits that if neither the doctrine of issue estoppel nor the principle of abuse of process applies in the present case, then I should adopt in full the reasoning of Williams J in relation to those issues. It is important to note that all of the evidence which was before Williams J concerning those issues is also before me. I have read and analysed that evidence, and I am in complete agreement with the reasoning of Williams J concerning it. It would be unduly wasteful for me to repeat all of that reasoning in this judgment. It is sufficient for me to state that I agree entirely with what her Honour said at [12]-[154] and [263]-[345].

Exercise of Discretion

61    Among the matters which I have taken into account in exercising the discretion under s 37AO(2) of the FCA Act are the serious consequences of a vexatious proceedings order for the respondents, and the protective purpose which such an order serves. As the New South Wales Court of Appeal (comprising Beazley P, Emmett JA and Sackville AJA) expressed the matter in Teoh v Hunters Hill Council (No 8) [2014] NSWCA 125 at [56]:

An order restricting a person’s access to the courts is a very serious matter and thus an order under the VP Act is not to be made lightly. The purpose of the statutory power is not to punish the litigant for past misdeeds. The purpose is to shield other litigants from harassment and to protect the Court itself from the expense, burden and inconvenience of baseless and repetitious suits.

62    It is also relevant to consider whether the respondents have displayed insight into their conduct in the earlier proceedings that have been found to be vexatious proceedings, which may diminish the risk posed to the public in the future: Official Trustee in Bankruptcy v Gargan (No 2) [2009] FCA 398 at [12] (Perram J).

63    In the present case, for the reasons set out above, each of the respondents in the various proceedings which were vexatious has harassed and caused unreasonable detriment to the applicants, from which they should be protected. Further, the respondents have burdened the resources of various courts in a way which courts should be protected from, in order to be able to deal efficiently and properly with the demands of other litigants. As there has been no appearance by or on behalf of the respondents before me in these proceedings, there is no demonstration of any likelihood of their past litigious conduct not being repeated in the future, and no demonstration of any insight into their earlier conduct.

64    Accordingly, I regard it as appropriate to make the order sought by the applicants pursuant to s 37AO(2)(b) that the respondents, by themselves, their servants and agents, be prohibited from instituting any proceedings in the Federal Court of Australia, or filing an application or originating process in any existing proceedings in the Federal Court of Australia, either in their own name or in the name of any other person, against any of the following:

(a)    the Liquidator;

(b)    ENA;

(c)    any current or former director, employee, agent or consultant of the firm BRI Ferrier (being the Liquidator’s firm); and

(d)    any current or former director, employee, agent or consultant of ERA Legal (being the applicants’ solicitors),

relating to or in any way connected with the winding up of ENA, without first obtaining leave of this Court.

65    The applicants also seek orders pursuant to s 37AO(2)(a) staying or dismissing the Sebie Federal Court Proceedings and the Federal Court Appeal Proceedings.

66    As to the Sebie Federal Court Proceedings, Williams J found at [307] that those proceedings were an abuse of process and vexatious proceedings. For that reason, they should be permanently stayed. The reasons for judgment of Williams J given on 15 May 2023 supersede the earlier orders of Lee J made on 13 February 2023, which allowed a period of time for Mr Sebie to file an amended interlocutory process seven days after the determination of the applications filed in the Federal Circuit and Family Court of Australia. The orders of Lee J made that day provided that in the event that no amended interlocutory process was filed in accordance with that order, the proceedings be dismissed. However, now that there is a finding by Williams J (being a finding with which I agree) that the proceedings are an abuse of process, it is appropriate that an order be made for the permanent stay of those proceedings.

67    As to the Federal Court Appeal Proceedings, on 25 July 2023 the Liquidator filed a Notice of Acting - Appointment of Lawyer, and thereby was able to obtain the application for extension of time and leave to appeal, which was lodged on 6 March 2023 and accepted for filing on 20 March 2023, together with the affidavit of Mr Jemmott of 6 February 2023 in support of that application. Those documents have not been served. (I note that at the hearing before Williams J in April and May 2023, there was no evidence that Mr Jemmott had filed any appeal or application for leave to appeal from the orders made in the Second Jemmott Federal Court Proceedings: [135]. That would appear to be due to the Liquidator and his solicitors not having been aware of any such appeal or application). The application which the applicants’ solicitors have now obtained seeks leave to appeal from the judgment and orders of Markovic J made on 8 February 2023 in the Second Jemmott Federal Court Proceedings. As I have indicated above, Williams J found that those proceedings were an abuse of process and were commenced without reasonable grounds and accordingly were vexatious proceedings: [324]. I agree with those findings. There is no appeal from the orders and reasons of Williams J. It follows that any application for leave to appeal from the orders of Markovic J dismissing those proceedings must also be an abuse of process and must also lack reasonable grounds and be vexatious proceedings. In any event, the application for extension of time and leave to appeal, together with the affidavit of Mr Jemmott of 6 February 2023, do not disclose any tenable basis for maintaining or pursuing that appeal. Accordingly, it is appropriate to make an order permanently staying the Federal Court Appeal Proceedings.

Costs

68    The applicants seek an order for costs in the lump sum of $23,188.50, assessed in the supporting affidavit of their solicitor, Mr O’Neill, as the mid-point of the range of an assessment of costs on the party and party basis. The applicants do not seek an order for costs assessed on the indemnity basis.

69    The Court’s Costs Practice Note states that the Court’s preference, wherever it is practicable and appropriate to do so, is for the making of a lump sum costs order: para 4.1. In my view, that preferred approach is appropriate in the present case. Although the hearing was short, the process of assessment may well be lengthy and complex, having regard to the volume of material on which the applicants relied, and having regard to the respondents’ propensity to take unmeritorious points with considerable repetition. The evidence of Mr O’Neill provides a cogent basis for the figure sought. Accordingly, the appropriate order is that the respondents pay the applicants’ costs in the lump sum of $23,188.50.

Associate:

Dated:    2 August 2023

SCHEDULE OF PARTIES