CATCHWORDS Practice and procedure - security for costs of appeal - discretion - impecuniosity of appeliant - resident outside jurisdiction. Bankruptcy Act 1966 s.131 Federal Court of Australia Act 1975 s.56 Federal Court of Australia Rules 0.28 0.52 Beard v. Prestige Baking Industries Pty. Ltd. (1980) SI F.L.R. 454 Willey v. Synan (1335) 54 C.L.R. 175 BOHUMILA WEISSORA v. THE OFFICTAL RECEIVER IN BANKRUPTCY N. No. G 229 of 1985 Northrop J. Sydney 20 February 1986 (Not considered appropriate for general distribution. ) ye beasha a tahiee Dalen snatetediatatenunelie eeiiioe Madea tren ee ee ye seed eset oitcne Lecter eelicne cate ten ae ame een a a rs cr ee | way ee on IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) N. No. G 229 of 1985 ) ) GENERAL DIVISION BETWEEN : BOHUMILA WEISSORA Appellant and THE OFFICIAL RECEIVER IN BANKRUPTCY Respondent NORTHROP J. COURT: DATE: 20 FEBRUARY 1986 PLACE: SYDNEY MINUTES OF ORDER THE COURT ORDERS THAT: - 1. The proceedings, being the appeal, be stayed until the appellant provides security for costs in accordance with clause 2 of this order or until 23 April 1986, whichever first occurs. On or before Wednesday, 23 April 1986, the appellant do give security for costs by way of payment into Court of the sum of $1,800. In default of compliance by the appellant with order 2, the appeal is to stand dismissed and the appellant is to' pay to the respondent, the respondent's costs of the appeal. The costs of this application to be the respondent's costs in the appeal. The appeal date for hearing on 26 February 1986 be vacated. (Settlement and entry of Orders is dealt with in 0.36 of the Rules of Court.) spe ae foae x fo Vee SAME PRE gr me eee + ae sry = gergr wast on nn ae ie IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N. No. G 229 of 1985 eee GENERAL DIVISTON BETWEEN : BOHUMILA WEISSORA Appellant and THE OFFICIAL RECEIVER IN BANKRUPTCY Respondent COURT: NORTHROP J. DATE: 20 FEBRUARY 1986 PLACE: SYDNEY EX TEMPORE REASONS FOR JUDGMENT The respondent to this appeal, the Official Receiver in Bankruptcy, is moving the Court for orders that the appellant, Bohumila Weissora, give security for costs of the appeal by way of payment into Court of the sum of $2,500. That amount is calculated on the basis of the costs incurred to date on a party and party basis, approximately $676, and the anticipated future costs for the hearing of the appeal, approximately $1,800. In the present appeal, judgment was given by the Federal Court on 30 July 1985 on an application by the respondent to the appeal, that certain property registered in the name of the appellant, was property divisible amongst the oe tyre sym at wef creditors of the bankrupt, Zdnenek Weiss, the son of the respondent, being property that was acquired by the bankrupt after the commencement of his bankruptcy and before his discharge. The orders made on that application to the Federal Court are set out at pages 43 and 44 of the appeal book herein and need not be referred to in detail. It is sufficient to say that the appellant gave notice of appeal against that judgment on 19 August 1985; that the appellant has prepared appeal books, and a date has been fixed for the hearing of the appeal on 26 February 1986. The present motion was taken out on 14 February 1986 and is supported by an affidavit by Judith Ann Denise Trembath, a legal officer in the employ of the Australian Government Solicitor. The facts giving rise to the orders made by the Federal Court, the subject of the appeal, are set out in the reasons for judgment of Lockhart J., commencing at page 35 of the appeal book and need not be repeated in any detail. It is sufficient to say that the bankrupt became bankrupt on his own petition on 28 April 1978 and is still an undischarged bankrupt. The property in dispute is a flat in Bellevue Hill and is registered in the name of the mother of the bankrupt, the present appellant, although she provided no money towards its purchase. The appellant resides an Prague in Czechoslovakia. She was last in Australia some 10 or 15 years ago and she paid no part of the consideration for the transfer of the property in dispute, Flat 98/157 Vaictoria -pess me mare, mm epe ne 7. _ 47 we "5S Road, Bellevue Hill. The consideration was provided by the bankrupt. The appellant is a pensioner. She has always resided in Czechoslovakia and is aged 77 years, and from the material before the Court, the Court draws the inference that she would be unable to pay the costs of the appeal if her appeal is dismissed. In addition, the Court is conscious of the fact that she resides overseas and that if the respondent succeeds in defeating the appeal, inall probability the respondent would not be able to recover the costs of the appeal from any person. In those circumstances, questions arise as to whether the respondent is entitled to an order for security. Sub-sections 56(1) and (2) of the Federal Court of Australia Act 1976 provide:- "66. (1) The Court or a Judge may order a Plaintiff in a proceeding in the Court or an appellant in an appeal to the Court to give security for the payment of costs that may be awarded against him. (2) The security shall be of such amount, and given at such time and in such manner and form, as the Court or Judge directs." Order 28 of the Federal Court Rules deals with security for costs and on its face it appears to be directed to the original jurisdiction of the Federal Court, although, the interpretation rule, rule 1, gives a wide meaning to the words "applicant" and "respondent", for instance, under that rule, references in Order 28 to an applicant extend to any person who makes a claim for relief in any proceeding, and lr Sieh air alad 8A eteemetiaivatame lat wll on Rone ote eles ars A wy far y 2. 2, te aon ey ey references to a respondent extend to any person against whom a claim for relief is made in any proceading. Rule 3 refers to grounds for the ordering of security. The relevant provision is that where in any proceeding it _ appears to the Court on the application of a respondent that an applicant is ordinarily resident outside Australia, the Court may order the applicant to give such security as the Court thinks fit for the costs of the respondent of and incidental to the proceeding. In addition to that, under 0.52 ©.20, which provides for security for costs on an appeal in the appellate jurisdiction of the Court, it provides that unless the Court or a Judge otherwise directs, no security for costs of anappeal to the Court Shall be required. In Beard v. Prestige Baking Industries Pty. Ltd. (1980) 51 F.D.R. 454, I had occasion to consider the question of the ordering of security for costs in the appellate jurisdiction of the Federal Court. In the appellate jurisdiction the discretion is wider than in the original jurisdiction, and in the present case questions of the poverty of the appellant is a relevant circumstance for consideration whereas, except in relation to matters where the applicant in proceedings in the original jurisdiction is a corporation, the poverty of an applicant is normally not a relevant consideration. a7 es QO TE FS ny or merge ore In the present case, counsel for the appellant has urged the Court that it should exercise its discretion in favour of the appellant, and in soe doing, has urged the Court that in reality and on a proper analysis of the matter, the appellant is seeking to protect her rights of property in Australia and because she is doing that, she should he treated as a defendant and not as an applicant, or in the appeal, should be treated as the respondent and not as an appellant because of her interest in maintaining her rights of property in Australia. Counsel referred to and relied upon the expressions of opinion in the case of Willey v. Synan (1935) 54 C.L.R. 175 and in particular what was said by Dixon J. as then he was at page 184. That was acase decided on its own very Special facts where, because of the provisions of the Customs Act, a person who claimed goods which had been seized was compelled to take proceedings in the High Court, otherwise those goods were forfeited to the Commonwealth. In those circumstances, on proper analysis, it was held that a person who commenced proceedings under those provisions, although a plaintiff, was in reality a defendant and therefore should not be ordered to give security for costs of those proceedings. That is a very different type of case to the present. Here, the respondent took proceedings under s.131 of the Bankruptcy Act in relation to certain property. The appellant was named as a respondent to that application and the Court made orders against her. She is now seeking to Won per pene ween we spe me vole WoT i me ser reve es pee et nytt yes ~-e et even eee review that decision by way of appeal and in my opinion, there is no basis for saying that she is in the nature of a defendant seeking to protect her rights of property and therefore, in the exercise of its discretion, the Court should not compel her to give security. In my opinion, this is a case where security should be awarded andin so doing, I rely upon the very special circumstances of the case as disclosed in the facts given in the reasons for judgment of Mr. Justice Lockhart. The fact that on the face of it, the appellant is outside the jurisdiction and with the possible exception of the subject Matter of the dispute, has no assets in Australia and on an inference drawn from the facts, being a pensioner, she has no assets at all from which costs of the respondent could be paid and that therefore her impecuniosity is such that she is unlikely to be in the position to be able to pay costs if the appeal fails. This is a case where the appellant should not be allowed to proceed unless security is given. Against that is the fact that the respondent has delayed in seeking the order for security for costs. I adverted to this at the very opening of these reasons for judgment. Delay may be a reason for refusing to order security for costs. Because of that delay, the appellant has incurred costs in the preparation of the appeal book and the respondent has incurred costs which are claimed to be in the sum of about $676. v y omy Worm erase we -f "See wry mone mee ee nat, ho ge no ape In all the circumstances, the security for costs should relate only to future costs, although there is authority for the proposition that past costs can also be included in such an order for security, but is a matter for @iscretion. The order I propose to make is limited to the future costs which are estimated to be approximately $1,800. The orders that the Court makes, therefore, are as follows:- 1. The proceedings, being the appeal, be stayed until the appellant provides security for costs in accordance with clause 2 of this order or umtil 23 April 1986, whichever first occurs, 2. On or before Wednesday, 23 April 1986, the appellant do give security for costs by way of payment into Court of the sum of $1,800. 3. In default of compliance by the appellant with order 2, the appeal is to stand dismissed and the appellant is to pay to the respondent, the respondent's costs of the appeal. 4, The costs of this application to he the respondent's costs in the appeal. ee Sirhan os 5. The appeal date for hearing on 26 1986 be vacated. Foo Sere Sas roe I ceitify that this and the (7) Sever preceding pages are a true copy of the Reasons for Judgment herein of the Honourable Mr. Justice Reorhwesy SRST er Aszociate a A Dated: 2c| 2 sec eo une lrsarclle. February TD ree ate ee ee ee Aye wer ow eee A Aes ae te pe eo ate ee tee yer o ener]