FEDERAL COURT OF AUSTRALIA Savage v Cranstoun (Trustee) [2001] FCA 1789 GORDON ALFRED SAVAGE v DAVID JOHN CRANSTOUN AS TRUSTEE FOR THE ESTATE OF D.J. SAVAGE No Q 204 of 2001 SPENDER J BRISBANE 11 DECEMBER 2001 IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 204 OF 2001 BETWEEN: GORDON ALFRED SAVAGE APPLICANT AND: DAVID JOHN CRANSTOUN as Trustee of the Estate of D.J. SAVAGE RESPONDENT JUDGE: SPENDER J DATE OF ORDER: 11 DECEMBER 2001 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The application for an extension of time within which to file and serve a notice of appeal be refused. 2. The applicant pay the respondent's costs. 3. A copy of the reasons today be forwarded to Mr Savage by the Registrar. 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 Q 204 OF 2001 BETWEEN: GORDON ALFRED SAVAGE APPLICANT AND: DAVID JOHN CRANSTOUN as Trustee of the Estate of D.J. SAVAGE RESPONDENT JUDGE: SPENDER J DATE: 11 DECEMBER 2001 PLACE: BRISBANE REASONS FOR JUDGMENT 1 This is the hearing of an application for an extension of time to file and serve a notice of appeal. A document so headed was filed on 19 September by Gordon Alfred Savage. I will shortly detail the events that have occurred since the filing of that document. I note that Mr Savage did not appear either by himself or through anybody else today when the matter was called. 2 The application for an extension of time to file and serve a notice of appeal filed on 19 September 2001 said in paragraph 4, that the grounds of the application appear in the annexed affidavit. In the affidavit, also filed on 19 September, Mr Savage said: "I have been waiting to receive a copy of the order made on 29 August 2001, before I can file the appeal papers. I need information on the order, for example the name of the person who made the order, etc to be able to complete the appeal. I am waiting for a response to my application for a waiver of filing fees. Without a copy of the order and a response to the waiver, I cannot complete the appeal papers. I have requested in writing a copy of the order to be sent to me. It is on these grounds that I am applying for an extension of time. My application for legal aid was refused, so I am relying on friends and family to do these forms for me." 3 The respondent, David John Cranstoun, who is the Trustee for the estate of Donna Jean Savage, Mr Gordon Savage's wife, filed a notice of appearance on 3 October 2001. 4 The orders from which Mr Savage wishes to appeal were made by Federal Magistrate Raphael on 29 August 2001. Those orders were: "(1) That lands of the respondent namely, Lot 1 on Building Unit Plan 7275, County of Mackenzie, Parish of Gayndah, Title Reference 16879195, and Lot 62 on Registered Plan 181950 County of Lennox, Parish of Widgee, Title Reference 16345034 held by the respondent as tenant in common with the applicant be sold by the applicant and the proceeds thereof after payment of all expenses of and incidental to such sale be divided equally between the applicant and respondent and that prior to the distribution of the respondent's share by the applicant there be deducted from such share the costs set out in order 2 below and the balance then be paid by the applicant to the respondent. (2) The respondent pay applicant's costs of and incidental to the application pursuant to the rules of the Federal Magistrates Court." 5 While those orders were made on 29 August 2001, the reasons of the Federal Magistrate were not delivered until 12 October 2001, which is after the date of the filing of the application for an extension of time within which to file the notice of appeal. Those reasons show that the Federal Magistrate was concerned with an application by David John Cranstoun as Trustee for the estate of Donna Jean Savage, a bankrupt, for the sale of a property which the bankrupt held as joint tenant with her husband, Gordon Alfred Savage. The application was made pursuant to section 134(4) of the Bankruptcy Act. 6 Documents before the Magistrate contained advice from Legal Aid Queensland that Mr Savage had been declined legal aid in respect of those proceedings. In paragraph 6, Federal Magistrate Raphael recites: "When the matter came to be heard the respondent did not appear. Instead his daughter appeared by telephone. She did not raise in her comments any legal impediment to the Trustee exercising his power under section 134 nor did she provide any evidence of why such a sale might not be necessary. The Trustee had filed an outline of case on 21 August which indicated that the respondent owned two properties jointly with the bankrupt. It also indicated that the respondent had not responded to a letter of 16 February 2001 written by the Trustee." 7 That letter indicated in part that the Trustee intended to realise Donna Savage's share of those properties. 8 The Magistrate concluded that it was consistent with the purpose of the Bankruptcy Act and with public policy for the Trustee to be given leave to sell the property. I should note further that the Magistrate said at the conclusion of his judgment: "The Trustee has acted reasonably in my view both prior to and in regard to the application. I heard no evidence from the respondent himself and the submissions which were made by his daughter, articulate and eloquent as they were, do not provide me with any reason in law or in the particular circumstances of this case, to decline to make the orders sought by the Trustee. I say this notwithstanding the suggestion that to sell would deprive the respondent and his daughter of their home. This is an event which frequently occurs when people get into financial difficulties. At least in this instance, one half of the proceeds will be available for the rent or purchase of another property." 9 It is therefore difficult to see how the Magistrate could have fallen into error either in fact or in law in making the orders that he did. Those orders were based on the material put before him in the original proceeding, and the only submissions on behalf of the respondent were those to which he referred which were made by telephone by his daughter. 10 This application first came before the Federal Court on 3 October 2001. On that day, Drummond J ordered that the application be adjourned until 24 October 2001, and his Honour directed the Registrar inform the Federal Magistrate that the application had been adjourned in the expectation that the Federal Magistrate would furnish reasons for his decision of 29 August in time for Mr Savage to put his grounds in support of his application for an extension of time before the Court, and costs were then reserved. 11 As it turned out, Drummond J was unable to hear the adjourned application on 24 October. That date was vacated and the matter was listed for callover of the Full Court matters on Wednesday, 31 October 2001, at 9.30 am. However, on 19 October, the matter was listed for directions before me. On that morning, there was a telephone communication between the Court and Mr Savage, but for some reason unexplained, that conversation came to an end, and it was not then possible for the telephone number at which Mr Savage had previously been contacted to successfully arrange for contact to be made to him. On the 19th I observed that the position probably was that the telephone had not been replaced on the hook. 12 In my reasons for judgment of 19 October, I said (at [2]): "I read the circumstances into the record because, amongst other things, yesterday Mrs Savage rang the Registry on behalf of her husband concerning the directions hearing which had been set down this morning. She apparently told the Registry that her husband would not be able to speak on the phone. Her daughter, who speaks on behalf of her husband on occasions, is unavailable today to attend Court or to be part of a phone hook-up, and Mrs Savage also indicated that she had some difficulties." 13 She had communicated with the Registrar and said that she was going through a physical crisis of her own and doubted she could handle a telephone hook-up on behalf of her husband. 14 I then noted the difficulty that attends the present matter is the fact that Mr Savage has not done very much to advance his challenge to the decision of the Magistrate. There are, however, two aspects of the matter to which I have given great consideration. The first is that, notwithstanding the Magistrate made orders on 29 August, it was not until 12 October the reasons for those orders became available. It seems only appropriate that a person affected by orders should know the reasons for them so as to be in a position, if that is possible, to challenge them. 15 I noted also then the submissions on behalf of the Trustee which had been furnished to the Court by Mr Hudson, the solicitor for the Trustee, and those submissions dealt in detail with the questions of the time within which matters are to be brought and the basis on which an extension of time might be granted. On that occasion, I directed that a copy of my reasons be forwarded by post by the Registrar to Mr Savage, and with those reasons were to go a copy of the reasons of the Federal Magistrate delivered on 12 October 2001, and a copy of the respondent's submissions dated 18 October 2001 by Mr Hudson, the solicitor for the Trustee. 16 I directed that Mr Savage file with the Court and serve by post on the Trustee by delivery to Paul Hudson, solicitor, 40 Ralston Street, Wilston, 4051, a copy of the proposed notice of appeal specifying the grounds on which Mr Savage wishes to argue that the Federal Magistrate was wrong in law or in fact in making the orders that were pronounced on 29 August 2001. I directed that that proposed notice of appeal should be filed and served in the manner that I have indicated by 4 pm on Monday, 12 November 2001. In addition, Mr Savage should file and serve in the manner that I have earlier indicated an affidavit setting out what Mr Savage says are the special reasons why the Court should give leave to file and serve the notice of appeal. I reserved the costs of 19 October 2001, and directed that the application be listed for today, Tuesday, 11 December 2001, at 10.15 am. 17 A letter advising of the listing of this matter was sent by an officer of the Court on behalf of the District Registrar on 6 November 2001. On 13 November 2001, Deputy District Registrar Reynolds wrote to Mr Savage. That letter referred first to a letter dated 23 October 2001, and continued: "I note that on 1 November 2001, I spoke to Mrs Savage who indicated that you were unable to comply with the directions made by the judge. She undertook to write to me on your behalf setting out the reasons why you were unable to comply with them. To date, no such letter has been received. By yesterday (12 November 2001) you were to have filed and served an affidavit setting out the reasons why you consider you should be granted leave to appeal and a draft notice of appeal. However, no such documents have been received. Please let me know whether you intend proceeding with your application. Please also let me know within 7 days when you will be in a position to provide me with the documents referred to above, or, if not, written reasons why you are unable to attend to these matters. Yours faithfully." 18 After forwarding that letter, Deputy District Registrar Caroline Reynolds received a telephone call from Mrs Savage, who indicated that Mr Savage was unable to comply with the directions that I had made, as the tasks were beyond his capabilities. She said this was clear from documents already filed in the original proceedings. DDR Reynolds asked her to put this in writing and summarise the essence of what was contained in this material. 19 Deputy District Registrar Reynolds received a letter dated 7 November 2001 in response. Attached to that are some 31 pages of enclosures. While it is tedious, I think it important to set out the contents of that letter. Mrs Savage writes "for Gordon Savage" in the following terms: "In reference to my telephone conversation with Deputy District Registrar Reynolds, I am writing this letter on behalf of my husband, Gordon. He cannot do what is being asked of him. As my daughter and I have explained in previous letters submitted to the court, Gordon missed out on a lot of education as a child due to sickness. We started these proceedings because we felt that Mr Raphael FM made the wrong decision on 29 August 2001 to sell our property. According to Mr Raphael's reasons, it appears that he believed he was making an order to sell one property. However, the order states both our home and Gordon's unit are to be sold. Gordon was told that the appeal forms would be easy to fill in but, having no legal knowledge, we are finding it very difficult. Right through to the present, Gordon has been denied Legal Aid. This could possibly be because we complained to the Law Society about two of our solicitors who did not work in [our] best interests. One of these solicitors put us under duress and extreme pressure to agree to pay L. White a huge amount of money. We are in our fifties and have been living below the poverty line for many years. When Gordon received money from his Aunt's Will he bought a unit thinking that he could retire to it and let Joy have our home and 10 acres to make a living out of when she completes her uni correspondence course through HECS. This court action is causing us hardship and stress and we feel someone should be checking to see if the bankruptcy [is] legal, as I was told it is not. I could not get proper legal advice or help with the papers to get it annulled. As you can see from letters from L. White's Legal Aid Solicitor, he first threatened to take the matter to the District Court, then the Supreme Court, but instead took the matter to the Bankruptcy Court. I tried to get the matter taken back to the District Court, but again I could not get help in filling out the papers. According to the file in the District Court, no paperwork was put up in my defence regarding the claim for compensation. I am enclosing a copy of a police report for your information. The Inspector told our daughter that he could see no reason for our arrest. We feel we have been the victims of malicious prosecution and wrong court decisions from the very beginning. I apologise for taking so long to write this letter. We are in a drought and have to cart water from the creek for washing, etc. which takes a lot of time. Widgee does not have a post office, public telephone, fax machine or photocopier, and Gympie is about a 60 km round trip. Our elderly blue heeler went into fits and needs constant care. The money we were going to put into the property was spent trying to defend the court action of L. White. Gordon is unable to defend himself in this court action. He is on a Disability Pension for physical and mental and emotional problems and the possibility of losing everything is causing him continual stress. Our family has been under this constant stress for seven years now due to the actions of the Marshes and L. White, and every Christmas has been ruined since we came to Widgee. Gordon was acquitted of any wrongdoing and he feels that he should not have to lose his property for what amounts to an illegal debt of mine. Can you please help him? Yours sincerely," And the enclosures are: a police report dated 10 May 2001; a letter to the CJC dated 16 October 2001; a letter from Joy Savage which is undated; a letter from Gordon Savage; a letter from Dr Malik dated 24 August 2001; Legal Aid refusals dated 19 July 2001, 13 August 2001, 30 August 2001; letters from L. White's Legal Aid solicitor dated 9 July 1999, 29 July 1999, 18 November 1999, 10 December 1999; letter to the District Court, 11 August 1999; and the reply of 16 August 1999. Those documents do not provide a basis upon which one could have any confidence that an appeal would enjoy any prospects of success. 20 Order 52 rule 15(2) of the Federal Court Rules provides: "Notwithstanding anything in the preceding subrule, the Court or a Judge for special reasons may at any time give leave to file and serve a notice of appeal." 21 The Full Court in Jess v Scott (1986) 12 FCR 187 at 195 considered what were special reasons for the purpose of order 52 rule 15(2). The power to grant leave to serve a notice of appeal is discretionary. The prospect of success on the appeal is a relevant consideration to the exercise of that discretion. In this particular case, the decision of the Magistrate is such that it is difficult to see that there is any error either of fact or law in the decision of the Magistrate, having regard to the material before him. 22 Having regard to the totality of the circumstances, which I have set out, unfortunately at some length, this is a case where there has been no basis demonstrated, no doubt for the reasons which have been indicated, to suggest that any appeal would enjoy any prospects of success. Putting aside technical difficulties about time limits and so on, looking at the matter on the merits, it seems to be a case clearly where leave to appeal would not be granted because there are no prospects of success on the foreshadowed appeal. In those circumstances, it seems to me a clear case where the application for an extension of time within which to file and serve a notice of appeal should be refused. 23 I order that the applicant pay the respondent's costs, to be taxed if not agreed. Further, I note the costs of the Trustee in these proceedings are part of the Trustee's costs in the administration of the bankrupt estate. The Trustee thus will be able to access the funds from the sale of the properties in satisfaction of his costs in these proceedings, should that be necessary, and to the extent that it is necessary. 24 I direct a copy of the reasons today be forwarded to Mr Savage by the Registrar. I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender. Associate: Dated: 14 December 2001 There was no appearance by or for the Applicant Solicitor for the Respondent: Mr Paul Hudson Date of Hearing: 11 December 2001 Date of Judgment: 11 December 2001