FEDERAL COURT OF AUSTRALIA Simpson v O'Callaghan [2000] FCA 551 JOHN CHILMAN SIMPSON v JERRY O'CALLAGHAN V 7076 OF 2000 NORTH J 10 APRIL 2000 MELBOURNE IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY V 7076 OF 2000 BETWEEN: JOHN CHILMAN SIMPSON Applicant AND: JERRY O'CALLAGHAN Respondent JUDGE: NORTH J DATE OF ORDER: 10 APRIL 2000 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. The application for a sequestration order is adjourned to 10.15am on 1 May 2000. 2. Costs reserved. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY V 7076 OF 2000 BETWEEN: John Chilman Simpson Applicant AND: JERRY O'CALLAGHAN Respondent JUDGE: NORTH J DATE: 10 APRIL 2000 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 This is an application by Jerry O'Callaghan, the respondent, for an adjournment of the hearing of a creditor's petition. Mr Isles, who appears as counsel for Mr O'Callaghan, has outlined the very unfortunate circumstances that face both Mr O'Callaghan and the applicant, John Simpson. Mr O'Callaghan, who is a solicitor, seeks an adjournment in order to allow him to investigate the position of Ms Febbrarino, who was previously a client of his and against whom he presently has proceedings in the County Court for the payment of both his fees and fees owed to Mr Simpson, a barrister, for the conduct of proceedings brought by Ms Febbrarino against the State of Victoria. It has emerged in the course of argument that I am disposed to grant Mr O'Callaghan a short adjournment in the unfortunate circumstance where Ms Febbrarino has only very recently died. 2 The County Court proceedings are due to be heard on 26 April 2000. Ms Febbrarino died on 3 April, only a week ago. There is force in the proposition that things are in such a state of uncertainty that it is appropriate for Mr O'Callaghan to have some time to determine what course the litigation against Ms Febbrarino is to take and what course his claim, which includes an allowance for Mr Simpson's professional fees, will take. 3 Mr Isles, who appeared as counsel for Mr O'Callaghan, has indicated the particular steps that Mr O'Callaghan desires to take. He wishes to search the titles of a number of properties in which Mr O'Callaghan knows, from acting for Ms Febbrarino, she had some interest and he also wishes to make some inquiries concerning whether Ms Febbrarino held assets by way of insurance policies which might benefit her estate. These steps are to be taken against the background of the suggestion by Mr Simpson that Ms Febbrarino has died intestate and that her estate contains no assets. At present that suggestion is made by way of a statement from the bar table. 4 The litigation has already had a substantial history and it is critical to ensure that its history henceforth is as limited as the Court can possibly make it. It seems a classical case where without strong vigilance the essential debt will be easily overshadowed by the costs of further proceedings. Consequently, it seems just in all the circumstances to allow a short time to Mr O'Callaghan to take steps which may, and hopefully will, result in a situation in which both he and Mr Simpson can be financially satisfied from the assets of the person for whom the legal work was done, namely, Ms Febbrarino. 5 I therefore will adjourn the matter until 1 May 2000 at 10.15 am. I think it fair to say that the affidavit material filed to date on the critical issues has been less than satisfactory. As a result of that situation Mr O'Callaghan was called to give oral evidence to supplement that deficiency. Therefore, for the purposes of the hearing on 1 May, if the intervening actions of Mr O'Callaghan are relevant to the position at that time, I would expect to see the relevant matters set out in an affidavit in detail and with full explanations. 6 1 May is a directions day and is not likely to present the opportunity to deal with the matter to finality, if that is required. If the situation on 1 May is that the asset and liability position of Ms Febbrarino is either undetermined or in such a state as to reveal that she will not be the source of satisfaction to either Mr Simpson or Mr O'Callaghan, then the parties should give very serious consideration to a mediation of the issues between them. That course may allow those issues to be resolved quickly and without the resort to expensive litigation in one or more courts. The unusual facts of this case have placed both parties in a most invidious position and one can understand, as I have earlier said, the strong perception of right of each of them. The situation calls for intervention of some commonsense with a view to reducing, rather than expanding, the areas of dispute. No time can be too early for that to start. 7 Consequently, on 1 May, in the event that Ms Febbrarino's estate position is either no clearer or negative from the point of view of resolving the issues, I would ask that the parties come prepared to answer my question about the desirability of the remaining issues being dealt with by mediation. Indeed, it may be that on 1 May itself an officer of the court will be available to mediate, if that were desired. Should that be the case, then the parties should communicate with my associate before the day so that I can put those arrangements in place. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice North. Associate: Dated: 10 April 2000 Counsel for the Applicant: John C Simpson (In person) Solicitor for the Applicant: Brown & Co. Counsel for the Respondent: J Isles Solicitor for the Respondent: O'Callaghans Date of Hearing: 10 April 2000 Date of Judgment: 10 April 2000