National Australia Bank v Zollo [2000] FCA 1867

FEDERAL COURT OF AUSTRALIA

National Australia Bank v Zollo 2000 [FCA] 1867

Ehner v The Official Trustee in Bankruptcy [2000] HCA 63 Refd to

NATIONAL AUSTRALIA BANK v ALESSANDRO ZOLLO AND IOLANDA ZOLLO S 7004 OF 2000 KIEFEL J BRISBANE 19 DECEMBER 2000

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY S7004 OF 2000

BETWEEN: NATIONAL AUSTRALIA BANK (ACN 004 044 937)

APPLICANT CREDITOR

AND: ALESSANDRO ZOLLO AND IOLANDA ZOLLO

JUDGMENT DEBTORS

JUDGE: KIEFEL J

DATE OF ORDER: 19 DECEMBER 2000

WHERE MADE: BRISBANE

THE COURT ORDERS THAT: 1. The Judgment Debtors' application for an extension of time within which to appeal is dismissed. 2. The Judgment Debtors pay the Petitioning Creditor's costs of the application. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY S7004 OF 2000

BETWEEN: NATIONAL AUSTRALIA BANK (ACN 004 044 937)

APPLICANT CREDITOR

AND: ALESSANDRO ZOLLO AND IOLANDA ZOLLO

JUDGMENT DEBTOR

JUDGE: KIEFEL J

DATE: 19 DECEMBER 2000

PLACE: BRISBANE

REASONS FOR JUDGMENT 1 On 27 June 2000 Mansfield J made Orders sequestrating the estates of Mr and Mrs Zollo and making Orders as to costs. His Honour made those Orders after dismissing Mr and Mrs Zollo's application for an adjournment of the petition. 2 The purpose of the adjournment sought was to enable Mr and Mrs Zollo to pursue an application to re-open an action in the Supreme Court of South Australia involving an insurance policy. The Full Court of the Supreme Court of South Australia had construed the terms of that policy and held that Mr Zollo had not established that he satisfied the definition of permanent total disablement within the meaning of that policy. It was accepted before Mansfield J that it was relevant for his Honour to consider whether there was a genuine and arguable case that leave to re-open the case would be granted by the Supreme Court so that Mr Zollo might recover sufficient funds to discharge the relevant indebtedness. 3 The essence of Mr Zollo's claim to a re-opening was that other policies of insurance existed and that the insurer, a company associated with the petitioning creditor, had withheld this information from him. His Honour held there was no evidence to suggest that there was more than one policy, or that any other policy might have wording different from that considered by the Full Court. 4 The first basis for the application for extension of time was that Mr and Mrs Zollo had only a short time within which to file a Notice of Appeal, because his Honour was not in a position to deliver reasons immediately upon pronouncing the Orders. It may be accepted that time was short, but I do not consider that that fact alone establishes the "special reasons" for an extension of time under O 52 r 15(2), and there are discretionary considerations which ought to be addressed. 5 Given that the time for the bringing of an appeal has passed, it is necessary to consider whether an appeal would have any reasonable prospect of success. I do not think that could be said in this case. An appeal would seem to me to be futile. There does not appear to me to be any basis for concluding that his Honour was in error in determining that Mr and Mrs Zollo would not obtain leave to re-open their case. There is simply no evidence to support their claims with respect to the existence of some other, different, insurance policy. Bald assertions that Mr and Mrs Zollo have evidence of the issue of policies takes the matter no further. 6 The alternative basis for an appeal was that his Honour ought to have disqualified himself. Mr Zollo contended that O'Loughlin J informed the Judgment Debtors that no Judge of the South Australian Federal Court was free from an association with the petitioning creditor and therefore none could hear the application for extension of time. Mr Zollo says that this means Mansfield J is a shareholder. His Honour did not make such a statement. Whatever the reason for other Judges not hearing the matter it is a common practice in this Court for a Judge not to entertain an application such as an extension of time to appeal from their own decision. I add that since the decision in Ebner v The Official Trustee in Bankruptcy [2000] HCA 63, the fact that a Judge is a shareholder in a party to a case such as this would not require them to disqualify themselves. There is no automatic disqualification. The question to be addressed is whether there is a realistic possibility that the outcome of litigation would affect the value of the shares and in this case that would be determined in the negative. 7 The application for extension of time is dismissed with costs. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kiefel J.