FEDERAL COURT OF AUSTRALIA Low v The Owners Strata Plan No. 35790 [2016] FCA 949 Appeal from: Low v The Owners Strata Plan No. 35790 [2016] FCCA 900 File number(s): NSD 710 of 2016 Judge(s): BURLEY J Date of judgment: 9 August 2016 Catchwords: BANKRUPTCY AND INSOLVENCY – appeal from decision of the Federal Circuit Court of Australia refusing application to review sequestration order PRACTICE AND PROCEDURE – interlocutory application – application to dismiss appeal for failing to prosecute the appeal pursuant to r 36.74 of the Federal Court Rules 2011 (Cth) – consideration of prospects of success of the appeal Legislation: Bankruptcy Act 1966 (Cth) ss 52, 153B Federal Circuit Court of Australia Act 1999 (Cth) s 104 Federal Court of Australia Act 1976 (Cth) s 25 Federal Court Rules 2011 (Cth) r 36.74 Cases cited: Low v The Owners Strata Plan No. 35790 [2016] FCCA 900 Date of hearing: 9 August 2016 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: General and Personal Insolvency Category: Catchwords Number of paragraphs: 25 Counsel for the Appellant: The appellant did not appear Solicitor for the Respondent: Mr F Shafiq of J S Mueller & Co Lawyers ORDERS NSD 710 of 2016 BETWEEN: LAN HEONG LOW Appellant AND: THE OWNERS - STRATA PLAN NO 35790 Respondent JUDGE: BURLEY J DATE OF ORDER: 9 AUGUST 2016 THE COURT ORDERS THAT: 1. That the appeal be dismissed. 2. That the respondent's costs be paid out of the proceeds of the bankrupt estate. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT (Revised from transcript) BURLEY J: 1 In this proceeding, the respondent has filed an interlocutory application pursuant to rule 36.74 of the Federal Court Rules 2011 (Cth) (the Rules) for the dismissal of the appellant's appeal on the basis that the appellant has failed to prosecute the appeal. The proceedings were commenced by notice of appeal from a decision of a judge of the Federal Circuit Court of Australia (FCCA) filed on 13 May 2016. In it, the appellant appealed from a judgment given on 22 April 2016; Low v The Owners Strata Plan No. 35790 [2016] FCCA 900 (Judgment), pursuant to which an application to review a sequestration order made by a registrar of the FCCA against the estate of the appellant was refused. The review was conducted pursuant to subsection 104(3) of the Federal Circuit Court of Australia Act 1999 (Cth) as a hearing de novo. 2 The grounds of appeal relied upon in the present appeal and orders sought are as follows: Grounds of appeal 1. Procedural mistakes e.g. attend required court hearing dated 22 April 2016. 2. Failures to consider factors such as intention of the Managing Agent/Prop of SP35790, willingness to pay versus inability to pay, state law requirements etc. 3. Factors permitting annulment e.g. impact on my accessibility to employment, restrictions on travel, etc. Orders sought 1. Annulment of the Order of 20 July 2015 as I was not aware of the procedure until after the event upon receiving sms from a Ms Kate Mead dated 24 July 2015. 2. All matters be reviewed including hidden agenda including the practices and advice by the solicitors which could have exploited the legal pathway utilising bankruptcy proceedings. 3. The witnesses for the Respondent may be unreliable. 3 In the notice of appeal, the appellant listed the following under the heading "Appellant's address": The Appellant's address for service is: Place: PO Box [number given] KENSINGTON NSW 2033 Email: not applicable as unreliable The Appellant's address is [street address given] KENSINGTON NSW 2033. 4 Notifications were sent by the Court to those addresses informing the appellant of the first listing date for the proceeding. Notices were also sent to an email address supplied by the respondent's solicitor and an additional postal address, each of which were said to have been addresses via which the appellant had been contacted in the past. 5 The first case management conference in the matter was conducted on 22 June 2016. This case management conference was initially listed on 17 June 2016, but was rescheduled when no communications were received from the appellant regarding her availability on this date. On 22 June 2016 the matter was called, but the appellant failed to appear. 6 I gave directions re-listing the proceedings on 19 July 2016 and the Court provided notification of the listing by post to the postal addresses listed in the notice of appeal and also to the additional email and postal address supplied by the respondent's solicitors. 7 The appellant did not appear on 19 July 2016 and on that date I gave directions to the respondent for the filing and service of any interlocutory application seeking dismissal of the appeal. 8 On 19 July 2016, the Court notified the appellant by email and mail (at the addresses identified above, with the exception of the appellant's street address as provided in the notice of appeal, as all mail sent to this address had been returned) of the orders made and of the fact that the proceeding was to be listed for hearing of any interlocutory application seeking to dismiss the proceedings on 9 August 2016. 9 The present application was filed on 25 July 2016 together with an affidavit of Faiyaaz Shafiq sworn on the same date. I have been informed by Mr Shafiq, who appeared for the respondent, that on 2 August 2016 these materials were emailed and sent by express post to the post office box given by the appellant's address for service, and to her last-known residential address. In that regard, I have received as Exhibit A in this application copies of the email and letters sent by post on that date. 10 I am satisfied that by reason of the collective efforts of the Court and the respondent's solicitor that the appellant has had adequate notice of today's hearing. In particular, I am satisfied that notification was sent in accordance with subrule 36.74(2)(a) of the Rules. However, the appellant has not appeared, the matter having been called outside Court. 11 The power of a single judge to make the orders sought by the respondent is contained in section 25 of the Federal Court of Australia Act 1976 (Cth), which relevantly provides: (2B) A single Judge (sitting in Chambers or in open court) or a Full Court may: … (ba) make an order that an appeal to the Court be dismissed for want of prosecution; or (bb) make an order that an appeal to the Court be dismissed for: (i) failure to comply with a direction of the Court; or (ii) failure of the appellant to attend a hearing relating to the appeal… 12 Rule 36.74 of the Rules is entitled "Application to Dismiss Appeal". It provides: (1) A respondent may apply to the Court for an order that the appeal be dismissed for the failure by an appellant to do any of the following: (a) comply with a direction of the Court; (b) comply with these Rules; (c) attend a hearing relating to the appeal; (d) prosecute the appeal. (2) An application under subrule (1) must be served on the appellant: (a) at the appellant's address for service; or (b) personally. 13 In the present case, the respondent submits that the appellant has failed to appear and has failed to prosecute her appeal with due diligence. I agree. It seems to me that the facts of the present case indicate that the failures of the appellant satisfy each of subrules (1)(a), (c) and (d) above. 14 The respondent has filed written submissions which not only address the chronology above but also address the substance of the appeal. The respondent submits that having regard to the grounds of appeal and the decision of the primary judge, the appeal is in any event, hopeless. 15 Ground 1 concerns "Procedural mistakes e.g. attend required court hearing dated 22 April 2016". The significance of 22 April 2016 is that that was the day upon which the primary judge delivered the Judgment and orders. No appealable error arises from the delivery of the Judgment on that day. In any event, the appellant was, as Mr Shafiq's affidavit confirms, informed in advance of the listing for judgment. 16 Ground 2 asserts that there were failures on the part of the primary judge to consider factors such as the intention of the managing agent of the strata plan, willingness to pay as opposed to inability to pay, and "state law requirements etc". 17 I have considered the decision of the learned primary judge carefully. Her Honour identifies the matters required at the hearing of a creditor's petition and quotes section 52(1) of the Bankruptcy Act 1966 (Cth). In [22] to [62] of her decision, she addresses those matters and notes that all of the requirements have been satisfied. Her Honour then addresses at [63] and following whether the appellant has satisfied her that she is able to pay her debts within subsection 52(2)(a) of the Bankruptcy Act 1966 (Cth) or whether she has demonstrated other sufficient cause that a sequestration order ought not to be made pursuant to subsection 52(2)(b) of the Bankruptcy Act 1966 (Cth). 18 At [64], the primary judge notes that whilst the appellant was given more than one opportunity to file affidavit evidence in support of the proposition that she was able to pay her debts within subsection 52(2)(a), or establish solvency for the purpose of her annulment application, she had not done so. At [64] the primary judge said: I explained to her the relevance of such evidence. However while she subsequently filed further affidavit evidence, it contained no information as to her financial position. In addition, notwithstanding requests from the trustees of her bankrupt estate, Ms Low has failed to complete a statement of affairs or to provide requested information. 19 At [75] the primary judge found that the appellant had not discharged her onus of proving that she can pay her debts within subsection 52(2)(a) and that the Court would be disinclined, in any event, to exercise its discretion to dismiss the petition pursuant to subsection 52(2) because of the appellant's failure to disclose her financial position. 20 The primary judge also considered whether there was any other sufficient cause to dismiss the creditor's petition and concluded that there was not (at [85] and [87]). 21 Ground 3 concerns the appellant's application for an annulment of her bankruptcy pursuant to section 153B of the Bankruptcy Act 1966 (Cth). 22 At [91] to [98] of her Judgment, the learned primary judge considered this application. At [93] and [96], the primary judge considered the relevant matters under section 153B and rejected the application. 23 Having reviewed these matters, I can see no basis upon which the applicant's appeal would be likely to succeed. I agree with the respondent's submission that the appeal appears to be hopeless. 24 Accordingly, I conclude that the appeal should be dismissed for want of prosecution in accordance with rule 36.74. I am fortified in my conclusion that this is the appropriate course by the view that I have expressed above in relation to the prospects of success of the appeal. 25 I order: (1) That the appeal be dismissed. (2) That the respondent's costs be paid out of the proceeds of the bankrupt estate. I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Burley. Associate: Dated: 9 August 2016