Federal Court of Australia

LFDB v SM (Vexatious Proceedings Order) [2026] FCA 1420

ORDERS

THE COURT ORDERS THAT:

1.    The hearing on 8 October 2026 be vacated.

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

REASONS FOR JUDGMENT

JACKMAN J:

1    In LFDB v SM (No 9) [2026] FCA 1118 (the Principal Judgment) at [56], I expressed a preliminary and tentative view that the Court could be satisfied that LFDB has frequently instituted or pursued vexatious proceedings within the meaning of s 37AM(1) of the Federal Court of Australia Act 1976 (Cth) (the FCA Act), and if that were so, the question may arise as to whether a vexatious proceedings order should be made under s 37AO of the FCA Act, with the effect of prohibiting LFDB from instituting further proceedings in this Court without first obtaining leave of the Court. In order to assist LFDB in preparing for a hearing on that question, I referred to eight proceedings (including interlocutory proceedings) which LFDB had commenced in Australian courts, and which I expected him to address in his submissions, without limiting LFDB as to the matters on which he may seek to rely in resisting a vexatious proceedings order. I ordered LFDB to file any affidavits and written submissions on the question whether a vexatious proceedings order should be made against him by 21 September 2026, and fixed the matter for hearing on that question on 8 October 2026.

2    LFDB filed extensive written submissions and an affidavit on 21 September 2026. LFDB stated in his written submissions that he did not seek an oral hearing and was content for the question to be determined on the papers.

3    Capitalised defined terms used in the Principal Judgment bear the same meaning in these reasons.

Legislative provisions

4    Section 37AO of the FCA Act relevantly provides:

(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 paragraph (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

…

(6)    For the purposes of subsection (1), the Court may have regard to:

(a)    proceedings instituted (or attempted to be instituted) or conducted in any Australian court or tribunal; and

(b)    orders made by any Australian court or tribunal; and

(c)    the person’s overall conduct in proceedings conducted in any Australian court or tribunal (including the person’s compliance with orders made by that court or tribunal);

including proceedings instituted (or attempted to be instituted) or conducted, and orders made, before the commencement of this section.

5    The word “frequently” in s 37AO(1)(a) is not defined, and bears its ordinary meaning; it is a lower threshold than the previous requirement of establishing that vexatious proceedings had been conducted “habitually, persistently and without reasonable grounds”: Fuller v Toms [2015] FCAFC 91; (2015) 234 FCR 535 at [33] (Besanko, Logan and McKerracher JJ).

6    The word “proceeding” in relation to a court is defined in s 37AM(1) by reference to the meaning given by s 4 of the FCA Act, namely “a proceeding in a court, whether between parties or not, and includes an incidental proceeding in the course of, or in connexion with, a proceeding, and also includes an appeal”. The term “vexatious proceeding” is defined in s 37AM(1) as including:

(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.

7    The Court’s power to make orders pursuant to s 37AO is not to be exercised lightly. Further, the nature of the order is not to bar vexatious litigants from instituting proceedings entirely or to impose condign punishment for past litigious misdeeds, but to place any further prospective litigation brought by the litigant under the control of the Court, by imposing a requirement for leave: Storry v Parkyn [2024] FCAFC 67 at [39] (Lee, Feutrill and Jackman JJ); Storry v Parkyn (Vexatious Proceedings Order) [2024] FCAFC 100; (2024) 304 FCR 318 at [18] (Lee, Feutrill and Jackman JJ); Luck v Secretary, Services Australia (Vexatious Proceedings Order) [2025] FCAFC 103 at [44] (Rofe, Hespe and Kennett JJ); Ogawa v Australian Information Commissioner (Vexatious Proceedings Orders) [2025] FCAFC 167 at [7] (McElwaine, McEvoy and Jackman JJ).

8    As s 37AO(6) contemplates, the orders and reasons for judgment in other proceedings may be relied on to show the outcome of the proceedings and the course they had taken, and to record the person’s conduct in those proceedings for the purpose of considering whether a proceeding is vexatious and hence whether s 37AO(1) is engaged: Storry v Parkyn (Vexatious Proceedings Order) [2024] FCAFC 100; (2024) 304 FCR 318 at [21], citing the characteristically thorough and helpful analysis of Wheelahan J in Fokas v Mansfield as Trustee of the Bankrupt Estate of Maria Fokas (No 2) [2020] FCA 30 at [41]–[66]. It remains, however, a matter for the Court which is deciding the question whether a vexatious proceedings order should be made to form its own independent view as to whether those other proceedings should be characterised as vexatious proceedings.

Has LFDB frequently instituted or conducted vexatious proceedings in Australian courts?

9    The first question which arises under this heading is whether the eight matters to which I drew attention in the Principal Judgment at [57] constitute vexatious proceedings as defined in s 37AM(1).

10    The first matter concerns the application for a stay of the appeal from the Australian Primary Judgment which was heard by Jagot J on 23 June 2017, and which her Honour described as “hopeless” (T18.23–4). Justice Jagot did not give a judgment on the application for a stay, but the transcript demonstrates that her Honour perceived a number of problems with LFDB’s application for a stay. Her Honour noted that LFDB contended that the freezing orders made in the New Zealand proceedings meant that no lawyer had been willing to accept money from LFDB in payment of fees to represent him in his appeal, but LFDB had not provided any evidence that he had attempted to obtain legal representation for the appeal or that any lawyer had actually looked at the freezing order and decided not to act for him. Her Honour also noted that there was no evidence that LFDB had actually made any further application for leave in New Zealand. Her Honour was struck by the oddity of LFDB seeking a stay of his own appeal. Her Honour’s reference to the stay application as being hopeless was not confined to the problem of LFDB’s assertions from the bar table not having been supported by evidence, but was a general reference to all of the submissions that LFDB had made. Although Jagot J declined to say that the appeal itself was futile and went no further than saying that the appeal was “not prima facie strong” (T15.14), the relevant question is whether the stay application constituted a vexatious proceeding rather than the appeal itself. In my view, the stay application was a proceeding instituted or pursued without reasonable ground, and I regard the language used by Jagot J in refusing the application as being consistent with that characterisation.

11    The second matter is the interlocutory application referred to in the Australian Appellate Judgment at [53], which the Full Court described as “misconceived” at [58], and as having “no merit” at [63]. LFDB accepts those findings. Although, as LFDB submits, the Full Court declined at [8] to make a finding that this amounted to an abuse of process, it nonetheless subsequently ordered him to pay the costs of that interlocutory application on the indemnity basis by reason of having caused the respondent to have been unreasonably subjected to wholly unnecessary costs, as LFDB also accepts: LFDB v SM (No 2) [2017] FCAFC 207 at [12]. I regard that application as a proceeding instituted or pursued without reasonable ground, and thus find that it was a vexatious proceeding.

12    The third matter is the application for leave to appeal from Wigney J’s decision which Jagot J dismissed in Du Bray v ACW [2019] FCA 1586. Justice Wigney’s decision concerned the use of pseudonyms rather than disclosing the names of parties. Justice Jagot refused leave to appeal on the basis that there was not any doubt about the correctness of the primary judge’s decision, nor would LFDB suffer any injustice as a result of the decision. However, Jagot J’s reasons do not go so far as to say that the application was brought without reasonable ground, and I note that on this occasion LFDB was represented by counsel and solicitors. I do not find that this application constituted a vexatious proceeding.

13    The fourth matter is the application for a stay pending appeal from Wigney J’s sequestration order which Stewart J dismissed in Du Bray v ACW [2020] FCA 1142, and the appeal itself (which was dismissed for failure to provide security for costs). As to the stay application, the reasons of Stewart J do not go so far as to indicate that the application was brought without reasonable ground, although his Honour did regard the prospects of the appeal as weak. As to the appeal itself, that was not dismissed on its merits but by reason of LFDB’s failure to comply with an order requiring the provision of security for costs of the appeal: Du Bray v ACW [2021] FCAFC 103 at [18] (Jagot, Yates and Colvin JJ). I do not regard either the stay application or the appeal as a vexatious proceeding.

14    The fifth matter concerns the proceedings in the Supreme Court of Western Australia decided by Gething J in Du Bray v RSM Australia [2026] WASC 113, in which LFDB sought a declaration that McElwaine J’s decision in Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd [2025] FCA 814 was void on the basis of jurisdictional error. Justice Gething found that it was clear that the Supreme Court of Western Australia had no jurisdiction to decide a matter which was in essence an appeal from a decision of the Federal Court. His Honour stated (at [75]) that LFDB’s attempt to do so was an abuse of the process of the Supreme Court of Western Australia. His Honour summarily dismissed the application (at [78]). I accept Gething J’s characterisation of the proceeding as an abuse of process, and accordingly find that it constituted a vexatious proceeding.

15    The sixth matter concerns the interlocutory application by LFDB filed on 20 May 2026, which McElwaine J decided in Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd (No 3) [2026] FCA 854. By interlocutory application dated 1 August 2025, the first and second defendants in this proceeding sought an order that LFDB be liable for their costs of the proceeding, although he was not personally a party to the proceeding. On 20 May 2026, LFDB filed an interlocutory application seeking that the defendants’ interlocutory application of 1 August 2025 be dismissed on the basis that it had no reasonable prospect of success. I regard LFDB’s interlocutory application as wholly unnecessary, as it was sufficient for LDFB simply to defend the application brought by the defendants. In substance, LFDB’s stance was a defensive one, but as a matter of form LFDB did institute and pursue a proceeding of his own. LFDB made submissions to the effect that the evidence did not establish his involvement in the proceeding and that, as a bankrupt, he could not lawfully have exercised control over Bad Wolf Purchasing Pty Ltd. His Honour found against LFDB on all his submissions, finding that LFDB had funded the proceeding through an associated company, and was the person who stood to benefit from it if the applicant had succeeded, and also found that, despite the prohibition on undischarged bankrupts managing the affairs of corporations, that was precisely how LFDB acted (at [24]). His Honour also regarded LFDB’s submission that the defendants’ solicitors’ costs agreement was void or unenforceable as having no merit (at [27]). His Honour ordered that LFDB pay the first and second defendants’ costs of the proceeding. I regard LFDB’s interlocutory application as having been made without reasonable ground, and thus as constituting a vexatious proceeding, although it is relevant to the exercise of discretion considered below that LFDB’s position was in substance defensive.

16    The seventh matter concerns the interlocutory application by LFDB in these proceedings to join Marque Lawyers Pty Ltd, which I dismissed in LFDB v SM (No 7) [2026] FCA 718. I dismissed that application because there was no right or liability of Marque Lawyers Pty Ltd which has been directly affected by any issue in the proceedings, and it was not sufficient to justify the joinder of a non-party to establish that only that party could explain the circumstances in which the impugned transaction was carried out. In my view, the application was brought without reasonable ground and thus constitutes a vexatious proceeding. I bear in mind, however, that the misconceived application appears to have been based on a genuine misunderstanding on the part of LFDB as to the principles applicable to joinder of parties.

17    The eighth matter concerns the interlocutory application by LFDB which I decided against him in the Principal Judgment. I held that LFDB was precluded by both cause of action estoppel and issue estoppel from contending that the registration of the NZ Relevant Judgment was null and void or of no legal effect, or that the registration (if valid) should be set aside, and in any event LFDB’s application would have been precluded by Anshun estoppel. I regard that application as having been made without reasonable ground, and it thus constitutes a vexatious proceeding. That characterisation is reinforced by my rejection of LFDB’s repeated submission that the documents lodged with the Federal Court on 16 December 2015 were not available to him until after the orders of Younan J were made on 31 October 2025, whereas in fact those documents were not only available to LFDB but were actually tendered by his counsel at the hearing before Griffiths J on 12 October 2016: see [12], [17] and [51] of the Principal Judgment.

18    Accordingly, of the eight matters which I raised as possibly constituting vexatious proceedings, I have found that LFDB has instituted or conducted two vexatious proceedings in 2017 (namely the first and second matters), and four vexatious proceedings in 2026 (being the fifth to eighth matters).

19    The question then arises whether LFDB has “frequently” instituted or conducted vexatious proceedings within the meaning of s 37AO(1)(a). As indicated above, the word “frequently” is not defined in the Act and bears its ordinary meaning. The ordinary meaning refers to matters occurring often or in close succession. In my view, the fact that LFDB has instituted four vexatious proceedings in 2026 satisfies the statutory concept of “frequently”. There is no need, in my view, to consider also whether the two occasions in 2017, after which there was a gap of over eight years before the next occurrence, are too distant in time to fall within the concept of “frequently” in conjunction with the four occasions in 2026.

Should a vexatious proceedings order be made?

20    It follows from my reasoning thus far that the statutory discretion whether to make a vexatious proceedings order is enlivened. That in itself provides a substantial reason for a vexatious proceedings order to be made. However, the exercise of discretion must have regard to all the circumstances. Those circumstances include the following salient matters.

21    First, five of the six vexatious proceedings appear to me to have proceeded on a genuine misunderstanding of the law. As a litigant in person, some latitude should be afforded to LFDB in that regard. The one exception is the sixth matter, namely the interlocutory application decided in Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd (No 3) [2026] FCA 854, where LFDB’s submissions as to his non-involvement in the litigation were rejected by McElwaine J at a factual level. However, the characterisation of the non-party costs issue as a proceeding instituted by LFDB is properly seen as formal and technical, in that LFDB’s position was in substance defensive in relation to an application for costs which was brought against him as a non-party.

22    Second, there is no indication in the material available to me that LFDB has conducted any of the proceedings in an offensive, insulting or disrespectful manner. My own observation of LFDB in the seventh and eighth matters considered above is that he was calm, measured and respectful of both his opponents and the Court. Although LFDB tends to be overly keen to resort to litigation, he has not engaged in the kind of indignant repetition of cases which often characterises the conduct of those who are made subject to vexatious proceedings orders.

23    On balance, in my view, it would not be appropriate to make a vexatious proceedings order on the basis of the material currently available to me. That is not to say that circumstances may not arise in the future which may justify a vexatious proceedings order on the basis of the material which I have considered in conjunction with matters which may arise or come to light in any future application.

24    The only order which needs to be made is to vacate the hearing currently scheduled for 8 October 2026. Now that I have determined whether a vexatious proceedings order should be made, the interlocutory application dated 19 March 2026, which I dealt with in the Principal Judgment, is dismissed pursuant to order 1 made on 10 August 2026.

Associate:

Dated:    25 September 2026

SCHEDULE OF PARTIES