Federal Court of Australia

Thompson v Lane [2025] FCA 297

ORDERS

THE COURT ORDERS THAT:

1.    The following proceedings be referred to the National Operations Registrar for the purposes of reallocation to another judge of the Court:

a. Emma Narelle Cathryn Thompson v Morgan Lane (QUD 709 of 2024)

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

REASONS FOR JUDGMENT

MEAGHER J

1    This matter concerns an application for leave to appeal from a judgment of a Judge of this Court. The applicant is a litigant in person. The matter was allocated to my docket and set down for a first case management hearing on 17 February 2025. At that case management hearing, I recused myself from hearing the application. These are my reasons for so doing.

2    The draft notice of appeal filed with the application for leave to appeal is unclear and discursive, however it is possible to glean that it inter alia impugns a costs order. According to the applicant, the costs order was invalidly made.

3    The draft notice of appeal alleges that a law firm, the claimed beneficiary of a costs order, had:

… failed to comply with the requisite requirements of relevant legislation including;

Legal Professional Act 2007, including s.308 and s.315, s.340 and s.341; and

Legal Profession Regulation 2017, including s.69; and

Australian Solicitors Conduct Rules 2012, including Rules 3, 5 and 19.

4     I infer by that, the applicant who is a litigant in person, meant the following:

    Legal Profession Act 2007 (Qld), ss 308, 315, 340, 341;

    Legal Profession Regulation 2017 (Qld), s 69; and

    Australian Solicitors’ Conduct Rules 2012, rr 3, 5 and 19.

5    Of particular relevance, the Draft Notice of Appeal included the following:

…

Pertaining to the first of the three (3) identified issues, one serious question to be tried is that there is no valid legal basis for the respondent;

…

d) to fraudulently pay amounts to third parties, including payments in excess of $317,679.56 as identified on page 99 of the exhibits to the respondent’s affidavit dated 25 January 2020, and in paragraphs 52, 53 and 54 of the decision of Collier J, for the reasons that the amounts of;

$122,421.21 comprising five (5) payments of $12,233.38, $40,173.38, $13,970.00, $42,368.70 and $13,675.75, was paid in absence of a valid Costs Agreement between the respondent and Shand Taylor Lawyers; and in absence of a valid basis noting that;

the letter of Charles Londy of Londy Lawyers dated 22 July 2020; and

the letter of Glen Walter Cost Assessor dated 9 September 2020

both predate the first payment to Shand Taylor Lawyers, and both letters confirm;

that in 2020, prior to when QUD113 of 2021 was filed, the respondent was aware that the Appellant was solvent and there were not valid Proof of Debt Claims of $1,332,934 to be paid from the bankrupt estate; and

the respondent misled the Court because there was not a valid Proof of Debt Claim of $820,479 made by Body Corporate for Arila Lodge CTS 14237 (“BCAL”), as is identified in paragraph [37] and [38] of the decision of Logan J dated 22 February 2022 made in proceeding QUD 113 of 202 [sic]; and

the documents filed and the Submissions made by the respondent and Shand Taylor Lawyers in QUD113 of 2021 fraudulently misled the Court and were “directly material” and were relied upon to dismiss the Appellant’s bankruptcy Application; and

the decision of Logan J dated 22 February 2020 must be set aside regardless of when it was made, and the “water which has long ago passed under the bridge” as is stated by Collier J in paragraph 61 of the decision

…

$46,900.00 comprising two (2) payments being $1,900.00 and $45,000.00 paid to Londy Lawyers; noting that Charles Londy introduced the Appellant to the respondent and the appellant relied upon the legal advice Charles Londy provided that the respondent would “go behind” the decisions made in legal proceedings invalidly made by Body Corporate for Arila Lodge CTS 14237 (“BCAL”). The $46,900.00 was paid in absence of exhibited evidence of a valid Costs Agreement between the respondent and Londy Lawyers, and is also part of the Proof of Debt Claim made by Londy Lawyers.

(Emphasis in original.)

6    Shortly before the first case management hearing my associate brought to my attention that Mr Charles Londy has a very close, long standing, and ongoing quasi familial relationship with her and her family.

7    At the case management hearing, I advised the parties of that relationship. The transcript relevantly discloses as follows:

HER HONOUR: … I need to tell the parties that it has come to my attention that my associate’s family are very closely linked to Mr Londy’s family. Now, Mr Londy, I believe, has been one of the people who, Ms Thompson, I think you claim has been paid by Mr O’Sullivan’s client. Is that correct?

MS THOMPSON: That’s my understanding, but disclosure of exactly what has happened hasn’t been made.

…

MS THOMPSON: And prior to that, Charles Londy provided a 20-page document to Morgan Lane, providing abundant reasons why I was not insolvent and why the $820,479 proof of debt claim made by the body corporate for Arilla [sic] Lodge CTS 14237 was invalidly made. However, Morgan Lane did not inform the court of that, and in – on – pages 37 and 38 of the decision in that matter confirms the court’s reliance upon Morgan Lane’s false opinion. So that is the connection. I actually have a copy of Charles Londy’s 20 pages of advice with me, if your Honour would like to see that, but that is certainly concerning that, since 2021, the court has been misled. None of the solicitors – including Charles Londy – have informed the court that court has been misled, and no steps have been taken to set aside that proceeding.

HER HONOUR: Okay. Well, Ms Thompson, thank you for that. It’s a very serious allegation to make that the court has been misled, but I think the threshold question for me is that it’s probably appropriate that I recuse myself on the basis of the relationship that exists, because, as the parties would no doubt be aware, an associate’s role is integral to what occurs in chambers, and I think that the right thing for me to do is for the matter to be sent back to the National Operations Registry to be allocated to a judge who does not have something that could be a perceived conflict of interest. I’m happy to hear from both parties further on that, but that’s my preliminary position.

MS THOMPSON: Well, your Honour, I’m grateful that you’re taking that position. I’m grateful that you’re doing the right steps, because multiple other officers of the court have failed to do the right steps, and I’m not making the statements I previously made without an abundance of evidence to support what I’ve said.

8    The respondent’s oral submissions were that he had no objection to my hearing the application, that Mr Londy had not given evidence in the matter and no relief was being sought against Mr Londy, and that, after five years, the creditors of the bankrupt estate had still not been paid out because “that has been put on hold while all of this is being resolved”.

9    It is well established that not only must a judge be unbiased, but importantly for this case, must be seen to be unbiased. In that regard, the High Court observed, in Charisteas v Charisteas (2021) 273 CLR 289; [2021] HCA 29 at [11]:

Apprehended bias

Where, as here, a question arises as to the independence or impartiality of a judge, the applicable principles are well established, and they were not in dispute. The apprehension of bias principle is that “a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide”. The principle gives effect to the requirement that justice should both be done and be seen to be done, reflecting a requirement fundamental to the common law system of adversarial trial – that it is conducted by an independent and impartial tribunal. Its application requires two steps: first, “it requires the identification of what it is said might lead a judge … to decide a case other than on its legal and factual merits”; and, secondly, there must be articulated a “logical connection” between that matter and the feared departure from the judge deciding the case on its merits. Once those two steps are taken, the reasonableness of the asserted apprehension of bias can then ultimately be assessed.

(Emphasis in original and footnotes omitted.)

10    The test as to whether a judge ought to recuse him or herself on the basis that there may be an apprehension of bias attached to the hearing of a matter is set out in Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63 at [6] per Gleeson CJ, McHugh, Gummow and Hayne JJ:

Where, in the absence of any suggestion of actual bias, a question arises as to the independence or impartiality of a judge (or other judicial officer or juror), as here, the governing principle is that, subject to qualifications relating to waiver (which is not presently relevant) or necessity (which may be relevant to the second appeal), a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide. That principle gives effect to the requirement that justice should both be done and be seen to be done, a requirement which reflects the fundamental importance of the principle that the tribunal be independent and impartial. It is convenient to refer to it as the apprehension of bias principle.

(Footnotes omitted.)

11    In Ebner the plurality also observed, at [7] – [8]:

The apprehension of bias principle may be thought to find its justification in the importance of the basic principle, that the tribunal be independent and impartial. So important is the principle that even the appearance of departure from it is prohibited lest the integrity of the judicial system be undermined. There are, however, some other aspects of the apprehension of bias principle which should be recognised. Deciding whether a judicial officer (or juror) might not bring an impartial mind to the resolution of a question that has not been determined requires no prediction about how the judge or juror will in fact approach the matter. The question is one of possibility (real and not remote), not probability. Similarly, if the matter has already been decided, the test is one which requires no conclusion about what factors actually influenced the outcome. No attempt need be made to inquire into the actual thought processes of the judge or juror.

The apprehension of bias principle admits of the possibility of human frailty. Its application is as diverse as human frailty. Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The bare assertion that a judge (or juror) has an “interest” in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility of departure from impartial decision making, is articulated. Only then can the reasonableness of the asserted apprehension of bias be assessed.

(Emphasis in original.)

12    While it is well accepted that judges have a duty to sit, the plurality in Ebner also stated at [20]:

This is not to say that it is improper for a judge to decline to sit unless the judge has affirmatively concluded that he or she is disqualified. In a case of real doubt, it will often be prudent for a judge to decide not to sit in order to avoid the inconvenience that could result if an appellate court were to take a different view on the matter of disqualification. However, if the mere making of an insubstantial objection were sufficient to lead a judge to decline to hear or decide a case, the system would soon reach a stage where, for practical purposes, individual parties could influence the composition of the bench. That would be intolerable.

13    The approach to be taken was considered in QYFM v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2023) 97 ALJR 419; [2023] HCA 15 at [38] – [39] per Kiefel CJ and Gageler J, as his Honour then was:

Application of the criterion was identified in Ebner, and has been reiterated, logically to entail: (1) identification of the factor which it is said might lead a judge to resolve the question other than on its legal and factual merits; (2) articulation of the logical connection between that factor and the apprehended deviation from deciding that question on its merits; and (3) assessment of the reasonableness of that apprehension from the perspective of a fair-minded lay observer.

Ebner specifically rejected the notion that there exists a category of case, involving some “interest” or “association” on the part of a judge, in respect of which an apprehension of bias will be presumed without needing to undertake such an analysis in order to determine that the criterion is satisfied. The submission by the appellant that this Court should now recognise “incompatibility” between the judicial role and another role previously performed by a judge as a category of “interest” in respect of which an apprehension of bias will be presumed is irreconcilable with Ebner and must be rejected.

(Footnotes omitted.)

14    In Greensill Bank AG v Insurance Australia Limited [2025] FCA 95 at [15], Moore J stated “[t]hat reasonable minds may differ” in the application of the third step of the Ebner test, as expounded by Kiefel CJ and Gageler J, as his Honour then was, at [38] of QYFM.

15    In this case, the relevant factor is one of association, namely of the close association between my associate, who is integral to the operation of my chambers, and a party named both as a beneficiary of what the applicant alleges amounts to fraud and who is also claimed by the applicant to have failed to bring a critical matter to the attention of the Court.

16    In QYFM, the attributes of a fair-minded lay observer were considered at [47] – [49] by Kiefel CJ and Gageler J, as his Honour then was, as follows:

Being “fair-minded”, the observer “is neither complacent nor unduly sensitive or suspicious”. Yet the observer is cognisant of “human frailty” and is all too aware of the reality that the judge is human. The observer understands that “information [as well as attitudes] consciously and conscientiously discarded might still sometimes have a subconscious effect on even the most professional of decision-making”.

Being “lay”, the observer “is not to be assumed to have a detailed knowledge of the law, or of the character or ability of a particular judge”. Though the observer may be taken to understand that the judge, by reason of professional training and experience and fidelity to the judicial oath or affirmation, will have a greater capacity than most to discard “the irrelevant, the immaterial and the prejudicial” and to discharge the judicial function uninfluenced by past professional relationships, “the public perception of the judiciary is not advanced by attributing to the ... observer a knowledge of the law and an awareness of the judicial process that ordinary experience suggests not to be the case”. This indicates that the observer will see the person who is currently a judge as the person who was formerly an advocate and may be less inclined to dissociate the advocate from the cause advocated than would someone steeped in the adversary process with a cultivated sense of the ethics of the legal profession and the profundity of the judicial oath.

Nor is the observer so abstracted and dispassionate as to be insensitive to the impression that the circumstances in issue might reasonably create in the mind of the actual party who is asserting an apprehension of bias. The observer can be taken to appreciate that a party – especially an individual, and especially a non-citizen facing deportation on the basis of his conviction – might understandably experience a justifiable sense of disquiet in seeing his former prosecutor turn up as one of his judges.

(Footnotes omitted.)

17    I have also had regard to the prudential principles referred to in QYFM and the acknowledgement that a judge might recuse him or herself at an early stage of a proceeding in order to avoid costs being incurred unnecessarily and possible further delay. As the respondent has observed, much time has already elapsed in this case and I do not wish to risk compounding the time.

18    In that regard, I considered the statements of Gordon J at [97] of QYFM, in which her Honour said:

Second, there are prudential reasons. It is not improper for a judge to decline to sit without having affirmatively concluded that they are disqualified – in a case of “real doubt”, a judge may take the prudent course of deciding not to sit. The procedure adopted should not prevent a judge from taking that prudential (and practical) approach and deciding to recuse themselves in a case of real doubt, even if they and their colleagues on the Court were to ultimately conclude that the judge is not disqualified.

(Footnotes omitted.)

19    The comments of Edelman J at [129] of QYFM are also instructive, as his Honour stated:

As to the prudential and pragmatic reasons for the subject judge to make the determination concerning bias, this Court recognised in Ebner v Official Trustee in Bankruptcy that there may be circumstances in which a judge will decline to sit even if the judge has not affirmatively concluded that they are disqualified. This is sometimes described as a prudential principle. Prudence is a loose term which encompasses a value judgment based upon a combination of factors: the misnomer “duty to sit”, which is really a principle that a judge should not too readily disqualify themself, particularly where there is not a large pool of available alternative judges; and case management concerns including delays, and other issues including the inconvenience that might result if, after a lengthy trial, a finely balanced decision not to recuse were found on appeal to be incorrect.

(Footnotes omitted.)

20    Finally, in relation to the prudential reasons for recusal at [330] of QYFM Jagot J said:

For example, if the issue emerges at an early stage and is apparently arguable, court management practices generally operate, quite properly, to avoid wasting resources of parties on a satellite issue by the expedient of allocation of the case to a judge not subject to the issue. Courts, including this Court, have also routinely endorsed the prudent approach of judicial self-exclusion at an early stage, if possible, because litigation of satellite issues at the expense of parties may involve nothing but unnecessary delay and cost. Equally importantly, however, parties do not get to choose their judge, either directly, or indirectly by specious or trivial allegations of bias. As noted, judges have a duty to sit. And they have a duty of fidelity to the law and to their judicial oath or affirmation. To add to the potential complexity, judges and parties do not always know about an alleged bias issue in sufficient time to avoid formal judicial determination of the issue. Or there may be important considerations of principle or fairness to the parties and other litigants in having the question of bias resolved only after a hearing and by formal judicial determination. The potential factors in play are infinite. They may be transformed on constitution of the court or commencement of the hearing, but do not necessarily all cease at that moment.

(Footnotes omitted.)

21    Given the material before the Court contained in the draft notice of appeal, attached to the application for leave to appeal, and the matters referred to above, I am of the view that a fair-minded lay observer might reasonably have concerns as to whether I can bring an impartial mind to the matters which might be before me in this case.

22    Accordingly, the first case management hearing has not proceeded.

23    The matter should be referred to the National Operations Registry for reallocation to another judge.

Associate:

Dated:    31 March 2025