FEDERAL COURT OF AUSTRALIA Sherman v La Trobe University [2007] FCA 1911 PETER SHERMAN v LA TROBE UNIVERSITY VID 989 OF 2007 RYAN J 4 DECEMBER 2007 MELBOURNE IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VID 989 OF 2007 ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA BETWEEN: PETER SHERMAN Appellant AND: LA TROBE UNIVERSITY Respondent JUDGE: RYAN J DATE OF ORDER: 4 DECEMBER 2007 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. The appeal be dismissed. 2. The appellant pay the respondent's costs, to be taxed in default of agreement. 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 VID 989 OF 2007 ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA BETWEEN: PETER SHERMAN Appellant AND: LA TROBE UNIVERSITY Respondent JUDGE: RYAN J DATE: 4 DECEMBER 2007 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 There is before the Court a notice of appeal from orders of the Federal Magistrates Court made in Brisbane on 24 October 2007 dismissing an application by the appellant to set aside a bankruptcy notice which had been served on him at the instance of the respondent, La Trobe University. The notice of appeal invokes the following grounds: 'The learned Magistrate erred in: 1. making findings of fact unsupported by evidence; 2. failing to take into account material considerations; 3. failing to apply the law correctly; 4. any further or other ground the appellant may be advised to take prior to the hearing of the appeal.' 2 The respondent has filed a notice of objection to the competency of the appeal and has contended in support of that notice, first, that the orders of the Federal Magistrates Court were interlocutory so that the appellant would require leave to appeal from them, and in the events which have happened, would require an extension of time within which to seek that leave. Secondly, Mr Bornstein of Counsel for the respondent, has contended that the notice of appeal is defective because none of the grounds which I have just recited amounts to a proper indication or contention of error by the learned Federal Magistrate. 3 Before the Federal Magistrates Court two grounds were relied on by the appellant. The first was that the bankruptcy notice wrongly ascribed the address of the debtor as 8/11 Selwyn Avenue, Elwood, Victoria, 3184. As I understand it, the appellant contended before the Federal Magistrates Court that, although he had been served with the bankruptcy notice and was the person against whom La Trobe University had obtained orders for costs in the Supreme Court of Victoria and the High Court of Australia, amounting to a total of $14,643.89, which was the amount shown in the schedule to the bankruptcy notice as the total debt owing, he was not the Peter Sherman who resided at the address, 8/11 Selwyn Avenue, Elwood, shown in the bankruptcy notice. 4 The learned Federal Magistrate dealt with that contention by observing in his reasons, under the heading "Wrong Address"; '8. The Applicant admitted he is the Debtor referred to in the founding judgments, but says he does not live at "8/11 Selwyn Avenue, Elwood, Victoria". He says such an error is a serious defect. He relies upon a decision of the High Court in James v Federal Commissioner of Taxation (1955) 93 CLR 631. That decision does not assist him. The issue in that case, and one dealt with many times subsequently, is that a debtor must know what he needs to do to avoid committing an act of bankruptcy. The address of the Creditor at which the debt could be paid was an issue in that case. 9. Here what the Applicant says is that a mistake in the address amounts to a mistake in the identity of the Debtor. Mr Sherman admitted he was the Debtor referred to in the judgments. There is no merit in his argument that the Notice is defective for that reason.' 5 I can discern no error of law or mistake of fact in his Honour's treatment of that question. On my understanding of the relevant authorities the essential question is whether the person on whom a bankruptcy notice has been served has been misled in a material respect, either as to whether that person is, in fact, the person by whom the debt identified in the notice is owing, or as to what has to be done to pay the debt or otherwise comply with the bankruptcy notice. In neither of those respects was the bankruptcy notice in this case misleading. 6 The second issue argued before the learned Federal Magistrate was that the appellant had a counterclaim, set off or cross-demand equal to or exceeding the amount of the judgment debt. That contention, his Honour indicated, was confronted by the following difficulties: '10. … a) Apart from the bland assertion at paragraph 1 of his Affidavit filed 26 September 2007 that he has made a claim for damages in excess of $800,000, no particulars of the claim have been provided to this Court. Even though he says, after this passage of time, VCAT believe the relevant file can not currently "be located", the Applicant bears the onus of establishing a prima facie claim capable of securing a monetary award exists (see James v Abrahams (1981) 34 ALR 657 at 665). b) The Applicant has not prosecuted his $800,000 claim for damages, preferring to undertake an Appeal process which was unsuccessful. Although the Applicant asserts (at paragraph 7 of this Affidavit) what I contend to be an allegation of bias against two of the Appeal Justices (which is also misconceived), he does not explain adequately why he did not take the opportunity to have his re-hearing soon after the order of Pagone J of April 2002. 11. I am not satisfied that the Applicant has a counterclaim or set off within the meaning, of s 40(1)(g) of the Act and, as a result, is not entitled to an extension of time for compliance under s 41(7) of the Act.' 7 Again, I am unable to discern any error in the learned Federal Magistrate's approach to that question. It appears clear that, although the appellant had obtained an order from Pagone J in 2002 by consent that his complaint to Victorian Civil and Administrative Tribunal should be re-heard by that Tribunal differently constituted, he elected instead to pursue appeals from those orders, first to the Victorian Court of Appeal and, then, an application for leave to appeal to the High Court. It was those successive abortive attempts to appeal which resulted in the orders for costs made which gave rise to the debt on which the subject bankruptcy notice was founded. 8 Accordingly, I consider that the learned Federal Magistrate was correct in his conclusion that the appellant had not established a counterclaim or set off in an amount exceeding the sum of $14,643.89 claimed in the bankruptcy notice. Even if I were to treat the present notice of appeal as an application for leave to appeal, the applicant for leave, as he would then be, would clearly be unable, for the reasons already indicated, to satisfy the first limb of the requirements laid down by a Full Court of this Court in Décor Corporation Pty Limited v Dart Industries Incorporated (1991) 33 FCR 397 which stipulates that an applicant for leave to appeal from an interlocutory order must first show that the decision below is attended by sufficient doubt to warrant its reconsideration on appeal. 9 Even if I were wrong about that, it remains open to the appellant to raise all of the matters which he argued unsuccessfully before the Federal Magistrates Court and, on the proceedings in this Court, on the hearing of the respondent's petition for a sequestration order. For that reason, the applicant for leave to appeal could not satisfy the second limb of the test erected by the Full Court in Décor Corporation v Dart which requires an applicant to show that substantial injustice would result if leave were refused supposing the decision below to be wrong. I am also persuaded that Mr Bornstein is correct in his characterisation of the grounds of appeal in the notice as manifestly inadequate to establish an arguable appeal. Although leave could be given to amend the grounds if I were persuaded that there was some arguable basis, for the reasons already given, I have not been so persuaded. It follows that the appeal must be dismissed, with costs. I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan. Associate: Dated: 10 December 2007 Counsel for the Appellant: The appellant appeared in person Counsel for the Respondent: Mr P Bornstein Solicitor for the Respondent: Corrs Chambers Westgarth Date of Hearing: 4 December 2007 Date of Judgment: 4 December 2007