Kok v Commonwealth Development Bank (Australia) Ltd [2003] FCA 1107

FEDERAL COURT OF AUSTRALIA

Kok v Commonwealth Development Bank (Australia) Ltd [2003] FCA 1107 BERNARD CORNELIUS KOK V COMMONWEALTH DEVELOPMENT BANK (AUSTRALIA) LTD N 565 OF 2003 MADGWICK J 1 OCTOBER 2003 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 565 OF 2003

BETWEEN: BERNARD CORNELIUS KOK

APPLICANT

AND: COMMONWEALTH DEVELOPMENT BANK (AUSTRALIA) LIMITED

RESPONDENT

JUDGE: MADGWICK J

DATE OF ORDER: 1 OCTOBER 2003

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The application be dismissed. 2. The applicant pay the respondent's costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 565 OF 2003

BETWEEN: BERNARD CORNELIUS KOK

APPLICANT

AND: COMMONWEALTH DEVELOPMENT BANK (AUSTRALIA) LIMITED

RESPONDENT

JUDGE: MADGWICK J

DATE: 1 OCTOBER 2003

PLACE: SYDNEY

REASONS FOR JUDGMENT (revised from transcript)

Madgwick J: 1 This was an application for extension of time to file and serve a notice of appeal against a judgment of Beaumont J given on 14 February 2003 ([2003] FCA 90). His Honour, by that judgment, made a sequestration order against the estate of the present applicant. The respondent bank had sued the applicant to recover amounts due under a loan for which the applicant was jointly and separately liable and had recovered judgment against him in the Local Court of New South Wales for $27,691.36 (after allowance for a sum of $5,000 which was received subsequent to the judgment from the receiver of a partnership, in connection with the operations of which the respondent bank had made the loan). 2 The applicant failed to have the default judgment relied upon in the bankruptcy proceedings set aside. He has appealed out of time to the Supreme Court of New South Wales against the refusal of the Magistrate in the Local Court to set the judgment aside. That appeal and/or an application to appeal out of time is for hearing in the Supreme Court twelve days from now. 3 The issues which the applicant agitated before Beaumont J as to why he should not be made bankrupt involved a suggestion that the respondent bank had 'committed collusion with the [receiver] of the former partnership'. The essence of this claim was that the bank had registered bills of sale over valuable machinery and equipment of the said partnership, having a value not less than $71,940, and perhaps as much as $180,000, but had accepted $5,000 from the receiver to discharge the bills of sale. 4 Beaumont J held that the discharge of the securities did not 'without more, operate to release' the liability for the debt established and evidenced by the Local Court judgment. His Honour gave authority for that proposition if it were needed and in my view it is, with respect, unarguably correct. His Honour also dealt adversely to the applicant with a point, that might have assisted the applicant but was not raised by him, of construction of the instrument of release between the receiver and the bank. It seems to me that his Honour was unarguably correct in relation to that matter also. 5 The respondent opposes the application for extension of time on the basis that there has been an unsatisfactory account of the very substantial delay both in making the application for extension of time and in prosecuting it. The application for extension of time was not made until 8 May 2003 and there have been delays in prosecuting it. However, Mr Kok, despite some history of delays and inattention, has put some matters which, to some extent, could amount to an inhibition against clear-minded and decisive action at relevant times. Without finally deciding the matter, it can be assumed that his accounting for the delays might be acceptable. 6 Nevertheless, there is no prospect, as it seems to me, that the projected appeal against Beaumont J's judgment could succeed. The issues which Mr Kok wishes to agitate are factual. They are said to be evidenced by various documents, the existence of all of which long preceded the hearing before Beaumont J. They could all have been subpoenaed and put in evidence before Beaumont J. I do not accept the explanation as to why this could not have been and was not done. In these circumstances, whatever the merits of it, there is simply no prospect whatever, in my opinion, that a Full Court would admit that factual material so as to permit, on appeal, a wholly new and different factual inquiry than the one which was undertaken by Beaumont J. 7 In these circumstances, it seems to me that leave to appeal should be refused. I am fortified in this view by the bank's proper concession that, should Mr Kok succeed in having the foundational Local Court judgment, which supported the bankruptcy notice non-compliance and the sequestration order set aside, the bank will consent to the annulment of the bankruptcy. 8 The application is dismissed with costs. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick.