FEDERAL COURT OF AUSTRALIA Cottrell v Nicholls (Trustee) in the matter of Cottrell (Bankrupt) [2004] FCA 102 DAVID M COTTRELL v ALAN NICHOLLS (AS TRUSTEE IN THE ESTATE OF DAVID M COTTRELL A BANKRUPT) N 7880 of 2000 ALLSOP J 27 FEBRUARY 2004 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 7880 of 2000 BETWEEN: DAVID M COTTRELL APPLICANT AND: ALAN NICHOLLS (TRUSTEE) RESPONDENT JUDGE: ALLSOP J DATE OF ORDER: 27 FEBRUARY 2004 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. On or before 12 March 2004, the parties file in the Registry by facsimile or otherwise any submissions in writing they wish to rely on should they wish to argue against the orders proposed in [31] and [35] of the reasons for judgment published today. 2. The matter stand over to a date to be fixed for the making of further orders. 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 7880 of 2000 BETWEEN: DAVID M COTTRELL APPLICANT AND: ALAN NICHOLLS (TRUSTEE) RESPONDENT JUDGE: ALLSOP J DATE: 27 FEBRUARY 2004 PLACE: SYDNEY REASONS FOR JUDGMENT 1 On 10 December 2003 the applicant, David M Cottrell, filed a notice of motion naming "Alan Nicholls (Trustee)" as respondent seeking orders explained and identified on the first page of the notice of motion in the following terms: This application relates to the making of a second sequestration order (N 6038/1/2 by Conti JJ on the 21st September 2001 during an appeal by the applicant before Conti JJagainst an already existing sequestration order (N 7880 of 2000) this applicant seeks the annulment of the second bankruptcy (6038/1/2) and the setting aside oF the second sequestration order (6038/1/2). Sequestration order (N 6038/1/2) and all attachments were generated as the result of a procedural error by the judge within the court system and as such must be set aside. This application is sought under section 153B of the Bankruptcy Act 1966. Orders sought: 1. setting aside of second sequestration order (6038/1/2) 21st September 2001. 2. Annulment of bankruptcy order (6038/1/2) 21st September 2001. Conti JJ . [Capitalisation in original] 2 The second page of the notice of motion contained a summary submission to which I will return. 3 Mr Cottrell filed two affidavits in support of his application. The first, entitled "Affidavit in support of Application", was a two page affidavit with various annexures. The second, entitled "Affidavit in Support of Application Containing Further and Better Particulars", contained two pages, then nine pages of annexures and a final summary page of material. Both these affidavits were sent to the Court by facsimile. Mr Cottrell is disabled and is not able to leave his home. 4 The notice of motion, in effect for an annulment of the bankruptcy of Mr Cottrell (or as Mr Cottrell would have it, the second of his bankruptcies) under s 153B of the Bankruptcy Act 1966 (Cth) (the Act), came before me on 16 December 2003. Ms Nash appeared for the trustee. 5 Prior to the hearing Mr Cottrell had sent another document to the court by facsimile. This was an eight page transmission which contained the following documents: (a) a facsimile from the Wagga Wagga Local Court to one of the Court officers in the New South Wales Registry, dealing with the authenticity of six pages said to be true copies of documents on the file at Wagga Wagga Local Court; (b) a facsimile from Mr Cottrell to the Wagga Wagga Local Court asking that six pages be authenticated as part of file 459 of 1992 in that court; (c) Six documents so authenticated being: (i) a note that in civil claim file 459/92 between John Alfred Wilcox as plaintiff and Mr Cottrell as defendant there was a note to the following effect "judgment set aside; judgment debtor pay judgment creditor costs of $500 within 28 days. Verified defence to be filed within 21 days"; (ii) a letter from the Registrar of the Wagga Wagga Local Court saying that the Magistrate's decision after evidence at the hearing on 22 June 1999 was as set out in (i) above; (iii) the form of a notice of grounds of defence apparently filed by Mr Cottrell in the Local Court proceedings; (iv) a document purporting to set out Mr Cottrell's defence; (v) a document with two receipt stamps dated 3 August 1999 being copies of the one receipt (R 563312) for $500 paid by Mr Cottrell; (vi) a handwritten note from a court clerk at Wagga Wagga Local Court that the original defence and cross claim in matter 459/92 were on file and that the defence dated 30 July 1992 and the cross claim were received on 25 August 1992. 6 From an examination of the material before me and the Court file, the chronology appears to be as follows. On 29 November 2000 a sequestration order was made against the estate of Mr Cottrell by a Registrar of the Court (Registrar Tesoriero) on the petition of John Alfred Wilcox (the plaintiff in the Wagga Wagga Local Court proceedings). The order noted that the date of the relevant act of bankruptcy was 18 September 2000. 7 Mr Nicholls was appointed trustee on 7 December 2000. 8 On 22 December 2000, Conti J made an order which in terms dismissed Mr Cottrell's application to set aside the sequestration order ([2000] FCA 1656). The first paragraph of the reasons for judgment of Conti J set out the background to the matter: On 29 November 2000 the Respondent David Mervyn Cottrell ("Mr Cottrell") was made bankrupt on the petition of an unsecured creditor John Alfred Wilcox ("Mr Wilcox"). The basis of the sequestration order in bankruptcy was non-compliance with a bankruptcy notice related to a Wagga Wagga Local Court judgment for moneys lent by Mr Wilcox to Mr Cottrell and interest accrued thereon in the sum of $36,679.42, which judgment had been entered on 17 August 1999 and remained unsatisfied. The petition in bankruptcy brought by Mr Wilcox was supported by Goddard Elliott claiming as an unsecured creditor for legal services in the sum of $21,636. No counter demand or counter claim was ever sought to be established by Mr Cottrell in this Court, nor was any application ever made to this Court to set aside the preceding bankruptcy notice prior to the sequestration order being made. 9 Mr Cottrell then appealed from the orders of Conti J and sought a stay. The application for a stay was rejected by Katz J on 7 March 2001 ([2001] FCA 193). The background to the application before Katz J was set out in [2] of his Honour's reasons as follows: The background to Mr Cottrell's motion is that on 29 November 2000, a Registrar of this Court made a sequestration order against Mr Cottrell's estate on the petition of Mr John Alfred Wilcox, that petition being supported by another creditor of Mr Cottrell's. Mr Cottrell applied for review of that order, but, on 22 December 2000, Conti J affirmed that order. Then, on 29 December 2000, Mr Cottrell filed in person both a notice of appeal from the judgment of Conti J and a notice of the present motion. Subsequently, on 5 February 2001, Mr Cottrell filed in person a supplementary notice of appeal. 10 On 17 May 2001 the appeal from the orders of Conti J was heard by a Full Court (Sundberg J, Emmett J and Finkelstein J). On 9 July 2001 the Court made orders allowing the appeal, setting aside the orders made by Conti J and remitting the matter to his Honour in accordance with s 35A(6) of the Federal Court of Australia Act 1976 (Cth): "on the basis that there is no notice of opposition to the petition". See [2001] FCA 866. 11 The Full Court set out the background to the matter in [1] of its reasons: On 29 November 2000 a sequestration order was made against the appellant's estate on the petition of the respondent. The order was made by a Registrar of the Court. The act of bankruptcy that founded the order was non‑compliance with a bankruptcy notice requiring payment of $36,679.42, being the amount of a judgment obtained by the respondent against the appellant in the Wagga Wagga Local Court for moneys lent together with interest. The appellant did not seek to establish a counterclaim or cross claim, and he did not apply to set aside the bankruptcy notice prior to the making of the sequestration order. On 20 December 2000 the appellant filed a notice of motion by which he sought an order that the Registrar's decision be reviewed and the sequestration order set aside. The matter came before a judge of the Court as a matter of urgency, for reasons that will be noted later. It was heard on 22 December. As a result of a physical disability that prevented him appearing in Court in Sydney, the appellant presented his case by telephone link from Yackandandah in Victoria. The primary judge refused to set aside the sequestration order and dismissed the motion. The appellant appeals from that decision. 12 The Full Court set out what it saw as the error of Conti J in approaching the matter as an appeal, rather than as a hearing de novo. The Court, however, made clear in its reasons that the serious allegations raised by Mr Cottrell concerning abuse of process and oppression and that he had a good defence or good cross-claim to the Wagga Wagga Local Court were correctly rejected by the primary judge. The Full Court made clear that the matters being remitted to Conti J in review of the Registrar's decision were limited to the determination of the formal matters of proof referred to in s 52(1) of the Act and would not extend to any further consideration of the other matters raised by Mr Cottrell. 13 On 19 September 2001, Conti J once again heard the review from the orders of Registrar Tesoriero, pursuant to the remittal of the matter by the Full Court. (It should be noted that the number of the file in which Mr Wilcox sought a sequestration order against Mr Cottrell was N 7880 of 2000. That was the matter before Registrar Tesoriero on 29 November 2000 and before Conti J on 22 December 2000 and 19 September 2001. The file number before Katz J and the Full Court was the appeal process number 1476 of 2000). The orders made by Conti J on 19 September 2001 were as follows: 1. A sequestration order be made against the estate of the Respondent [Mr Cottrell]. 2. The Respondent [Mr Cottrell] to pay the costs of the Applicant [Mr Wilcox]of the proceedings. 14 Section 35A(6) of the Federal Court Act was and is in the following terms: The Court may, on application under subsection (5) or of its own motion, review an exercise of power by a Registrar pursuant to this section and may make such order or orders as it thinks fit with respect to the matter with respect to which the power was exercised. 15 It is appropriate to note that notwithstanding the clear limitation placed on the remittal by the Full Court, Mr Cottrell once again sought to raise the issue that had been dealt with by Conti J on the first occasion and by the Full Court. 16 The necessity to hear the review de novo appears to have led his Honour to purport to make a fresh sequestration order. The appropriate form of order would, with respect, have been to affirm the Registrar's orders: see Meehan v Alfaro (1999) 93 FCR 201, 212; and Martin v Commonwealth Bank [2001] FCA 87 at [19]. That is consistent with the de novo review of the matter (in the sense of controversy contemplated by Chapter III of the Constitution), as opposed to the hearing of a fresh matter. 17 Mr Cottrell then appealed from the orders of Conti J. The appeal (N 1415 of 2001) was heard on 13 February 2002 by Branson J, Weinberg J and Dowsett J. On 14 March 2002, the Court made orders dismissing the appeal, with costs ([2003] FCA 232). The Court set out the detailed factual background in [2] to [7] of its reasons as follows: [2] The matter has had a long and somewhat convoluted history. On 29 November 2000 a Registrar of the Court, acting upon the petition of John Alfred Wilcox which was filed on 18 October 2000, made a sequestration order against the estate of Mr Cottrell. [3] The act of bankruptcy upon which the Registrar's order was founded was the appellant's failure to comply with a bankruptcy notice. That notice required payment of the sum of $36,697.42, that being the amount of a judgment obtained by the respondent against the appellant in the Local Court at Wagga Wagga. [4] The appellant did not endeavour to establish a counter claim or cross-claim. Nor did he make application, prior to the date upon which the Registrar made the sequestration order, to set aside the bankruptcy notice. [5] On 20 December 2000 the appellant filed a notice of motion in which he sought review of the Registrar's decision. He sought to have the sequestration order set aside, and in lieu thereof, to have an order made dismissing the creditor's petition. The basis of that application seems to have been an allegation of abuse of process on the part of the respondent. Conti J, who heard the notice of motion as a matter of urgency, characterised the appellant's claim as being referable to a "champertous agreement". His Honour rejected the application to set aside the sequestration order, and dismissed the notice of motion. The appellant then filed a notice of appeal against that decision. [6] On 9 July 2001, a Full Court comprising Sundberg, Emmett and Finkelstein JJ delivered reasons for judgment in which each and every contention advanced by the appellant regarding the supposedly champertous agreement was rejected. So too were various other claims which he made of breach of duty and of an attempt to pervert the course of justice. However, the Full Court found that Conti J had erred by dealing with the review of the Registrar's decision as though it were an appeal stricto sensu rather than a hearing de novo: see s 35A(6) of the Federal Court of Australia Act 1976 (Cth) and Martin v Commonwealth Bank [2001] FCA 87. [7] The Full Court's reasons for judgment in their initial form contained an order that the appeal be dismissed. That order was subsequently the subject of a corrigendum making it clear that the appeal had been allowed but only for the purpose of enabling the matter to be remitted to Conti J so that his Honour could consider it afresh, as a hearing de novo, in accordance with the reasons for judgment given by the Full Court. The orders pronounced and the reasons for judgment made it clear that his Honour was required to have before him current affidavits in accordance with O 77 r 19 of the Federal Court Rules. It was also indicated that he was expected to say, as a judge hearing an application for a sequestration order "customarily does", that he was satisfied of the matters proof of which s 52 of the Bankruptcy Act 1966 (Cth) ("the Act") requires. It is important to note that the Full Court specifically ordered that the remitter to his Honour be dealt with on the basis that there was no notice of opposition to the petition. 18 At [23] and [24] of their reasons the Full Court noted the following: [23] Conti J was obliged to consider the matter remitted to him upon the basis that there was no notice of opposition to the petition. The affidavit and annexures sought to be relied upon by the appellant sought, in effect, to circumvent the orders of the Full Court which had dealt conclusively, and to finality, with many of the issues raised by that evidence, on 9 July 2001. [24] When one adds to these considerations the fact that virtually all of the matters contained in the affidavit and in the annexures were fully known by the appellant at the time this matter was heard by Conti J on 21 September 2001, the discretionary considerations which favoured exclusion of this evidence were overwhelming. It was for these reasons that the Court rejected the application to lead further evidence. 19 It is appropriate to set out the balance of the Full Court's reasons because of the similarity of the underlying complaints made before me on 16 December 2003: [25] In addition to having sought to rely upon the new material contained in the affidavit and annexures, the appellant informed the Court both orally and in written submissions that on 31 January 2002 the judgment debt upon which the sequestration order had been based had in fact been set aside by the Local Court at Wagga Wagga . He caused to be sent by facsimile to the Court a copy of a letter which the Registrar of that Court had sent to him on 31 January 2002. That letter was in the following terms: Dear Sir/Madam Civil Claims File No: 459/92 Plaintiff: JOHN ALFRED WILCOX Ref: Defendant: DAVID COTTERILL (sic) (M) Ref: ******** JUDGEMENT SET ASIDE. JUDGEMENT DEBTOR PAY JUDGEMENT CREDITOR COSTS OF $500.00 WITHIN 28 DAYS. VERIFIED DEFENCE TO BE FILED WITHIN 21 DAYS." [26] Counsel for the respondent accepted that the Local Court had indeed set aside the judgment debt. He accepted also that it appeared that the appellant had settled all other outstanding claims, including that of the supporting creditor, thereby leaving the judgment debt in favour of the respondent, since set aside, as the only foundation for the appellant's bankruptcy. [27] It was against this background that the appellant informed the Court at the commencement of his submissions that he now wished to make application under s 153B of the Act to have his bankruptcy annulled. That section provides as follows: "If the Court is satisfied that a sequestration order ought not to have been made or, in the case of a debtor's petition, that the petition ought not to have been presented or ought not to have been accepted by the Official Receiver, the Court may make an order annulling the bankruptcy." [28] The appellant also informed the Court that he had applied to the Trustee to be discharged from his bankruptcy because the original judgment debt had been set aside. He said that had not yet received a response from the Trustee. It may be that the appellant has, in effect, sought to invoke s 153A of the Act. That section deals with the consequences of bankrupt's debts having been paid in full. However, this matter was not explored in any detail. It was made abundantly clear by the Court that the matter which was before it was an appeal from the judgment of Conti J on 21 September 2001, and that the Court would not entertain an application under s 153B which would, in any event, have to be made to the Court in its original jurisdiction. [29] After considering his position, the appellant informed the Court that notwithstanding the possible availability of s 153B as a vehicle whereby his bankruptcy might ultimately be annulled, he still desired to proceed with his appeal. He was then invited by the Court to identify any error on the part of Conti J which would warrant setting aside his Honour's judgment. [30] In substance, a number of the matters upon which the appellant sought to rely were those contained in the affidavit and annexures (which the Court had already ruled it would not receive). The appellant also sought to rely upon the fact that the judgment debt upon which the bankruptcy was based had been set aside. [31] A number of the grounds of appeal were based upon what was contained in the affidavit and annexures. In the absence of that material those grounds are plainly untenable. Indeed, even had that evidence been received, the majority of the grounds of appeal would have been rejected as being clearly devoid of merit. [32] It is true, as several of the grounds of appeal note, that Conti J referred to the judgment of the Full Court of 9 July 2001 as having dismissed Mr Cottrell's appeal when, in fact, the appeal had been allowed. However, the point is little more than one of semantics. The appeal was allowed for the limited purpose of remitting the matter to his Honour to enable him to reconsider it as a hearing de novo, and not as an appeal stricto sensu. [33] Conti J's reference in his reasons for judgment to the Full Court having "dismissed" the appeal was plainly either a slip, or possibly, merely an observation which was somewhat loosely expressed. It is clear, from a reading of his Honour's reasons for judgment, that he fully understood the import of the Full Court's judgment, and that he carried out the remitter to the letter. There is no substance in any of the grounds of appeal which rely upon this point, or his Honour's having supposedly failed to consider the corrigendum to the reasons for judgment subsequently made by the Full Court. [34] The appellant was unable to point to any error, whether of fact or law, on his Honour's part which could possibly warrant this Court setting aside his judgment. Nor could he identify any error of principle in the manner in which his Honour exercised his discretion in relation to the making of the sequestration order. Whatever may ultimately be the consequence of the judgment debt having been set aside by the Local Court at Wagga Wagga, none of the grounds of appeal have been made out. It follows that the appeal must be dismissed. There will be an order that the respondent's costs be taxed and paid from the estate of the appellant in accordance with the Bankruptcy Act 1966 (Cth). 20 On 16 May 2002, Mr Cottrell filed originating process, an application, in which he sought the annulment of the sequestration order of Registrar Tesoriero made on 29 November 2000. The respondent to the application was Mr Wilcox. 21 The application came before Branson J on 3 September 2002. Her Honour dismissed the application, with costs ([2002] FCA 1115). The background was set out in [1] of her Honour's reasons. On 21 September 2001 Conti J ordered that a sequestration order be made against the estate of David Mervyn Cottrell ("the applicant") (Wilcox v Cottrell [2001] FCA 1357). An appeal against the order of Conti J was dismissed by the Full Court on 14 March 2002 (Cottrell v Wilcox [2002] FCAFC 232). The applicant has now applied to the Court under s 153B of the Bankruptcy Act 1966 (Cth) ("the Act") for an order annulling his bankruptcy. The ground upon which the applicant seeks to have his bankruptcy annulled is that the judgment debt upon which the creditor's petition was founded was set aside by the Wagga Wagga Local Court on 31 January 2002. I accept that the judgment debt was set aside on that day. 22 Her Honour continued at [5] to [7], [13] and [14] as follows: [5] The fact that the judgment debt upon which the creditor's petition was based has been set aside by the Wagga Wagga Local Court is a fact which has occurred since the date of the sequestration order. The decision of the Full Court to which I have referred and the authorities upon which the decision relies establish that the setting aside of the judgment debt is not itself relevant on this application. However, the applicant, as I understand him, places reliance on the circumstances which resulted in the Wagga Wagga Local Court setting aside its earlier judgment. It is not entirely clear whether the true facts concerning these circumstances were before Conti J at the time that he made the sequestration order. Nor is it clear whether, if they were, the decision of the Full Court in Cottrell v Wilcox [2001] FCA 866, an appeal against a sequestration order made against the applicant's estate by Conti J on 29 November 2000, would have prevented Conti J from attaching any weight to them. [6] I have not found it necessary to determine these issues. Even if it be assumed that the sequestration order made on 21 September 2001 ought not to have been made, the Court has a discretion to annul, or alternatively not to annul, the applicant's bankruptcy. [7] An important factor relevant to the proper exercise of the Court's discretion is the applicant's solvency. The applicant has not, despite my invitation to do so, sought to prove that he is solvent. I am unable, therefore, to be satisfied that he is solvent. … [13] Another important matter in the exercise of the Court's discretion is the failure of the applicant to make any proposal for the payment of the fees and disbursements of the Trustee. The Trustee has given evidence that as at the date of his report he had outstanding fees and disbursements of $14,323.06 and that he estimated incurring additional legal and other costs of $7,000.00. The applicant has told the Court that he has not instructed the Trustee to act on his behalf in any way which could give rise to fees and disbursements of this magnitude. He has also asserted that he has had very limited contact with the Trustee. I accept that each of these things is probably the case, but the duties of a trustee in bankruptcy arise under the Act and do not depend upon instructions received from the bankrupt. [14] In all of the circumstances I am not satisfied that it would be an appropriate exercise of the Court's discretion to order that the bankruptcy of the applicant be annulled. The application is dismissed. 23 Mr Cottrell now seeks to annul the bankruptcy ordered by Conti J. The form of the order made by his Honour causes some difficulty. His Honour did not, in terms, affirm the Registrar's order. Plainly from the context, however, his Honour was intending to deal with the review of Registrar Tesoriero's order under s 35A(6). In that context an affirmation of the orders of the Registrar would have been appropriate. Further, in substance, it is plainly what Conti J must have intended. Mr Cottrell could have raised this point as to the form of Conti J's order on appeal. He did not. The appeal in 2002 was dealt with, as was the application before Branson J, on the basis that there was but one bankruptcy. 24 Mr Cottrell has put forward no evidence of his financial position. 25 The affidavits of Mr Cottrell traverse, in a somewhat confusing fashion, the background to which I have referred. 26 The "Summary" in Mr Cottrell's application was in the following terms: Summary It is my submission that Conti J erred on the two occasions that he dealt with my matter. Firstly on December 22nd 2000, when he failed to confirm the Registrars decision in making a sequestration order against me on 29th November 2000. And secondly he unnecessarily made a second sequestration order against me on 21st September 2001, in lieu of confirming the sequestration order made by the registrar on 29th November 2000. These two procedural errors made by Conti J and the second sequestration made by Conti J have caused me great stress and anxiety and I appeall [sic] to this Court to remedy those errors and set aside the second sequestration order (6038/1/1/) and annul the second bankruptcy and discharge me from bankruptcy N 7880 of 2000. This application is made under section 153B of the Bankruptcy Act 1966. [Capitalisation in original] 27 Notwithstanding the precise terms of the form of order of Conti J, in all the circumstances I do not think it appropriate to make any order under s 153B. 28 On 18 December 2003, Ms Nash, solicitor for the Trustee, sent a copy of a letter to me which she sent also to Mr Cottrell. That letter was in the following terms, relevantly: We refer to the appearance before his Honour on 16 December 2003. As indicated I telephoned Robert Cruickshanks at ITSA that afternoon. He is currently on an extended Christmas leave. I spoke to Mr Sandy Spyrakis and he confirmed to me:- 1. The bankrupt's Statement of Affairs was lodged with the Official Reciever on 18 April 2001 and subject to any objection by the Trustee, Mr Cottrell would expect to be discharged in the normal course on 19 April 2004. 2. The NPII reflects two Sequestration Orders because each order was made in a different proceeding. I explained to him that there is only one bankruptcy, based on one Creditors Petition, one available act of bankruptcy and one creditor, Mr Wilcox. The Trustee has relied on the Registrar's Sequestration Order made on 29 November 2000. 3. The Registrars Sequestration Order and the Sequestration Order made by Conti J are noted as two separate Sequestration Orders and were incorrectly presumed by ITSA to relate to two different bankruptcies rather than the same Creditors Petition and act of bankruptcy. 4. The Trustee asserts that the appropriate date for the Sequestration Order is that first made by the Registrar on 29 November 2000 which order has not been set aside and which is the order from which the Trustree's notification was given and is the commencement of the bankruptcy for the purpose of actions which the Trustee is currently taking against the bankrupt's sister. The Sequestration Order by Conti J is a confirmation of the first Sequestration Order. 29 The sending to me of the letter by Ms Nash after the hearing can be explained by the fact that she was given little formal notice of the application by Mr Cottrell and had not had an opportunity to prepare an affidavit from the trustee. 30 Whilst at the moment I am not prepared to make any orders under s 153B of the Act, it seems to me that the files of the Court and of the Insolvency and Trustee Service of Australia should reflect the legal substance of the matter. One possibility would be that I make an order to the effect that the order made by Conti J (and otherwise left untouched by the appeal from that order), be clarified such that it stands as an affirmation of the orders of Registrar Tesoriero of 29 November 2000. That order would be one made under Order 35 rule 7(2)(e). See Owston Nominees No 2 Pty Ltd v Branir Pty Ltd [2003] FCA 629. It may be preferable for Conti J to make such an order. That, however, is only likely to lead to further costs being incurred. Alternatively, it might be possible to make an order restraining the trustee from dealing with Mr Cottrell otherwise than on the basis that the operative sequestration order was made on 29 November 2000. The difficulty with this latter course is that sequestration orders have an effect on status and not merely as affecting rights between the trustee and the bankrupt. 31 On reflection, I think it appropriate to make an order under Order 35 rule 7(2)(e) vacating order 1 made by Conti J on 19 September 2001, and in its place making an order that the orders of Registrar Tesoriero made on 29 November 2000 be affirmed. In the context of circumstances that I have discussed, that was plainly the substance of the intention of the Court. I propose to stand the matter over to allow the parties to file written submissions as to this course, if they so desire. I do not propose to have any further oral hearing. 32 It should also be noted that on 28 January 2004, without leave, Mr Cottrell filed by facsimile a document entitled "Urgent Application for Stay of Proceedings (Section 178)". I assume that this was some application under s 178 of the Act which is in the following terms: (1) If the bankrupt, a creditor or any other person is affected by an act, omission or decision of the trustee, he or she may apply to the Court, and the Court may make such order in the matter as it thinks just and equitable. (2) The application must be made not later than 60 days after the day on which the person became aware of the trustee's act, omission or decision. 33 There is no evidence of any service of this on the respondent. It was sent directly to my associate virtually in the form of a letter. It was in the following terms: Dear Sir/Madam RE: COTTRELL V NICHOLS & WILCOX N 7880 of 2000 – ref 5330/0/3 NSW 6038/1/2. N 7846/98 ref 793 of 1998 I David M Cottrell Make this urgent application to this Court. I herein apply for a stay of all proceedings in this matter as above. I David Cottrell have a series of proceedings before this Court No N 76/2004 which are listed for directions hearing on Tuesday 24th February 2004. Owing to the serious nature of these matters and the irreversabel [sic] action planned by the Trustee, I David Cottrell request that this court take into consideration the content and strength of my application and grant a stay of proceeding until these matters can be brought before a Justice and be resolved in particular the procedural errors made by this Court. Prepared by David Cottrell [Capitalisation in original] 34 I have no evidence before me about what is referred to in the document. The document was not filed; it was simply received in chambers after a matter was reserved. Any substantive application should be brought properly on notice, filed in the Registry with supporting affidavits. I do not propose to deal with this document. 35 I do not propose to make any order for costs, but I will grant the parties leave to file written submissions on this subject matter also. 36 All submissions are to be filed with or sent to the Registry, not my chambers. I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate: Dated: 27 February 2004 The Applicant appeared in person by telephone. Solicitor for the Respondent: Ms S Nash Date of Hearing: 16 December 2003 Date of Judgment: 27 February 2004