FEDERAL COURT OF AUSTRALIA Kakavas v Paradise Enterprises Limited (No 2) [2010] FCA 1024 Citation: Kakavas v Paradise Enterprises Limited (No 2) [2010] FCA 1024 Parties: HARRY KAKAVAS v PARADISE ENTERPRISES LIMITED File number: VID 610 of 2010 Judge: TRACEY J Date of judgment: 7 September 2010 Legislation: Bankruptcy Act 1966 (Cth) Federal Court of Australia Act 1976 (Cth) ss 25, 33 Cases cited: Kakavas v Paradise Enterprises Limited [2010] FCA 915 cited Kakavas v Paradise Enterprises Limited [2010] FMCA 574 cited Date of hearing: 7 September 2010 Place: Melbourne Division: GENERAL DIVISION Category: No Catchwords Number of paragraphs: 14 Counsel for the Applicant: Mr M Galvin with Mr J Kohn Solicitor for the Applicant: Madwicks Counsel for the Respondent: Mr S Horgan SC with Mr C Möller Solicitor for the Respondent: Kliger Partners IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 610 of 2010 BETWEEN: HARRY KAKAVAS Applicant AND: PARADISE ENTERPRISES LIMITED Respondent JUDGE: TRACEY J DATE OF ORDER: 7 SEPTEMBER 2010 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. The Applicant's motion, notice of which was given on 30 August 2010, be refused. 2. Liberty be granted to the Respondent to apply within three days for costs orders to be made relating to the motion. Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 610 of 2010 BETWEEN: HARRY KAKAVAS Applicant AND: PARADISE ENTERPRISES LIMITED Respondent JUDGE: TRACEY J DATE: 7 september 2010 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 In Kakavas v Paradise Enterprises Limited [2010] FCA 915 I dismissed an application by Mr Kakavas for leave to appeal against a decision of the Federal Magistrates Court to the extent that it had refused an application by him for an extension of time within which he was required to comply with a bankruptcy notice. The extension was sought up to and including the hearing and determination of an appeal to the Victorian Court of Appeal from the judgment on which the bankruptcy notice was based: see Kakavas v Paradise Enterprises Limited [2010] FMCA 574. 2 When I pronounced judgment counsel for Mr Kakavas sought a further extension of time for compliance with the bankruptcy notice so that an application for special leave to appeal to the High Court might be filed. Because of the late hour I extended time for compliance until 4:45 pm on 8 September 2010 and directed that any application for a further extension of time for compliance be made by notice of motion supported by affidavit on or before 30 August 2010. 3 By notice of motion dated 30 August 2010 and filed on that day Mr Kakavas seeks an order extending the time within which he must comply with the notice "until 4:30 pm on the day on which the judgment of Federal Magistrate Riethmuller is delivered in Federal Magistrates Court proceeding number MLG 880/2010." 4 The background to the present application is set out in my earlier judgment: see Kakavas at [1]-[6]. I do not repeat it. In those reasons, at [9] I referred to another judgment which had been obtained against Mr Kakavas in the Victorian Supreme Court and which was also subject to appeal. The party which obtained judgment against Mr Kakavas in that proceeding was Crown Melbourne Limited. That company has also filed and served a bankruptcy notice on Mr Kakavas. Thereafter that proceeding has followed the same procedural course as was followed in the present case. An application was made to a Registrar for an extension of time in which Mr Kakavas was required to comply with the bankruptcy notice. The application was refused. An appeal was lodged to the Federal Magistrates Court. It came on for hearing on 4 August 2010 before the same Federal Magistrate who made the decision from which leave to appeal was sought in the present proceeding. His Honour adjourned the hearing of the application until 10 September 2010 pending delivery of my judgment on the application for leave to appeal. 5 Mr Kakavas anticipates that, when the matter comes on before the Federal Magistrate later this week, he will dismiss the application. This is because it is based on the same arguments which the Federal Magistrate rejected in the present proceeding. Mr Kakavas foreshadows that, in that event, he will again appeal to this Court and make a request that the Chief Justice convene a full bench to hear and determine that appeal. 6 The Respondent opposes the application for a further extension of time. It objects that the application is an abuse of process and is incompetent. 7 The Respondent contends that the abuse of process arises because the extension of time is sought on the same basis and for the same purpose as the application which has already been refused. No appeal lies from that decision: see ss 25(2) and 33(4B)(a) of the Federal Court of Australia Act 1976 (Cth). The exercise of the Court's jurisdiction is spent and, it is submitted, I am functus officio. 8 Further objection is taken that the order is sought on the ground of the likely developments in another proceeding in which the pending appeal decision will be based on a different debt and different findings of fact and law. It may also be made having regard to different discretionary considerations. 9 My decision refusing leave to appeal from the Federal Magistrates Court in the present proceeding brings an end to the statutory processes relating to Mr Kakavas' obligation to comply with the bankruptcy notice which has been served on him. If Mr Kakavas fails to comply with the notice within the required or extended time, it will be open to the Respondent to take further steps under the Bankruptcy Act 1966 (Cth). It may or may not take those steps. 10 Mr Kakavas seeks a further extension until such time as a Federal Magistrate rules on another extension application in another proceeding. If that decision is, as he anticipates, detrimental to his interests, he proposes to seek leave to appeal before a Full Court. He hopes to persuade the Chief Justice to convene a Full Court for this purpose. It may be doubted that the Chief Justice could so act consistently with s 25(2) of the Federal Court of Australia Act 1976 (Cth). Even if it be assumed that a Full Court was assembled and that Full Court was prepared to grant leave and allow an appeal in the other proceeding, that outcome would have no bearing on Mr Kakavas' legal position in the present proceeding. 11 Counsel for Mr Kakavas submitted that, if the Full Court found that solvency was not a relevant issue, I might then be persuaded further to extend time for compliance with the bankruptcy notice until the appeal to the Court of Appeal has been heard and determined. This submission is based on many assumptions. They include that the facts in the two proceedings, that is in this case and the Crown case, are not relevantly different; that the Federal Magistrate will act on the same discretionary considerations as he did on the previous occasion, and that the Full Court would allow the appeal on the relevancy of the solvency point. These are but some of the possible variables. 12 It would not be appropriate to exercise my discretion again to extend the time for compliance on the basis of many assumptions, and particularly in circumstances in which to do so would involve circumventing the legislative policy reflected in s 33(4B)(a) of the Federal Court of Australia Act. 13 There is no utility in further extending the time within which Mr Kakavas is obliged to comply with the bankruptcy notice. His application will therefore be refused. The formal order that I make will be that the Applicant's motion, notice of which was given on 30 August 2010, be refused. 14 Liberty is granted to the Respondent to apply within three days for costs orders relating to the motion. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey. Associate: Dated: 7 September 2010