Federal Court of Australia Docherty v Porter, in the matter of Docherty (Bankrupt) [2021] FCA 1227 File number: NSD 997 of 2021 Judgment of: PERRAM J Date of judgment: 8 October 2021 Date of publication of reasons: 11 October 2021 Catchwords: PRACTICE AND PROCEDURE – application for transfer of proceedings under s 5(4) of Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) to Supreme Court of New South Wales – where imminent trial in Supreme Court – where two proceedings form one 'matter' – 'special federal matter' – 'special reasons' BANKRUPTCY AND INSOLVENCY – jurisdiction of State Supreme Courts in bankruptcy Legislation: Constitution s 75(v) Bankruptcy Act 1966 (Cth) ss 27, 33, 129AA, 149, 306 Bankruptcy Legislation Amendment Act 1996 (Cth) Judiciary Act 1903 (Cth) ss 39, 39B Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) ss 3-4, 6 Trade Practices Act 1974 (Cth) Pt V Cases cited: Caason Investments Pty Ltd v International Litigation Partners No.3 Ltd [2018] FCAFC 176; 265 FCR 487 Commissioner of Police v Eaton [2013] HCA 2; 252 CLR 1 Fencott v Muller (1983) 152 CLR 570 Goodwin v Phillips (1908) 7 CLR 1 Gorkowski v Turner [2014] VSC 200; 285 FLR 66 Hodges v Waters (No 7) [2015] FCA 264 Mateljan v HTT Huntley Heritage Pty Ltd [2016] NSWCA 20; 111 ACSR 277 Meriton Apartments Pty Limited v Industrial Court of New South Wales [2008] FCAFC 172; 171 FCR 380 Palmer v Ayres [2017] HCA 5; 259 CLR 478 Potier v Attorney-General (NSW) [2015] NSWCA 129; 89 NSWLR 284 Re Wakim; Ex parte McNally [1999] HCA 27; 198 CLR 511 Re Wilcox; Ex parte Venture Industries Pty Ltd (1996) 66 FCR 511 Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 Truthful Endeavour Pty Ltd v Condon (Trustee), in the matter of Rayhill (Bankrupt) [2015] FCAFC 70; 233 FCR 174 Division: General Division Registry: New South Wales National Practice Area: Commercial and Corporations Sub-area: General and Personal Insolvency Number of paragraphs: 55 Date of hearing: 7 October 2021 Counsel for the Applicant: Ms M Castle Solicitor for the Applicant: Stephen Noss Lawyers Counsel for the Respondents: Mr A Spencer Solicitor for the Respondents: O'Neill Partners Commercial Lawyers Counsel for the Interested Party: Mr J Baird Solicitor for the Interested Party: Keypoint Law ORDERS NSD 997 of 2021 IN THE MATTER OF THE ESTATE OF THE BANKRUPT JAMES DOCHERTY BETWEEN: JAMES DOCHERTY Applicant AND: JASON PORTER First Respondent ANNE MEAGHER Second Respondent AND BETWEEN: JASON PORTER First Cross-Claimant ANNE MEAGHER Second Cross-Claimant AND: JAMES DOCHERTY Cross-Respondent order made by: PERRAM J DATE OF ORDER: 8 OCTOBER 2021 THE COURT ORDERS THAT: 1. Lynette Susan Montgomery be joined as the Third Respondent to this proceeding. 2. The proceeding be transferred to the Supreme Court of New South Wales to travel together so far as is possible with 2019/00214287, subject always to that court's views on how the two matters should be managed. 3. Costs be costs in the cause Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT PERRAM J: Introduction 1 On 8 October 2021 I made orders transferring this proceeding to the Supreme Court of New South Wales. These are my reasons for making those orders. 2 There is presently pending in the Equity Division of the Supreme Court of New South Wales a suit brought by Ms Lynette Susan Montgomery against the trustees of the bankrupt estate of Mr James Docherty being proceeding 2019/00214287. That suit arises in the following circumstances: 3 Ms Montgomery and Mr Docherty have been in a de facto relationship for over 30 years. Mr Docherty owned two properties, one at Llandilo and one at Kingswood, both of which were registered in his name. Ms Montgomery claims, and Mr Docherty agrees, that on 21 December 1990 they entered into an agreement pursuant to which Ms Montgomery was to receive at least a 50% share of all of the couple's present and future assets. It is not necessary to set out the terms of the agreement for present purposes. It will instead suffice to say that under its terms Ms Montgomery says she is now entitled to 100% of the couple's assets including the Llandilo and Kingswood properties. For completeness, it should be noted that the couple lives in the Llandilo property and say that they have done so since 1991. 4 The suit in the Supreme Court comes about because the properties are no longer registered in Mr Docherty's name but in the names of the trustees of his bankrupt estate, the Respondents to the present proceeding. There is debate about the precise date upon which this occurred but it is likely that Mr Docherty emerged from his bankruptcy on or around 3 August 2014, being the date shown on the records of the National Personal Insolvency Index ('NPII'). The estate itself is still, however, being administered. But for his supervening bankruptcy, Ms Montgomery's and Mr Docherty's shared view that she owns both the Llandilo and Kingswood properties would not, in all likelihood, have resulted in litigation. However, the view that Ms Montgomery and Mr Docherty have about her ownership of the two properties is not shared by Mr Docherty's trustees in bankruptcy. They dispute the bona fides of the agreement. Consequently, Ms Montgomery has sued the trustees in bankruptcy seeking specific performance of the agreement between herself and Mr Docherty. She puts her case on a number of other bases too including a claim in estoppel and a claim under the Property (Relationships) Act 1984 (NSW). This case is set down for a five day trial commencing on 26 October 2021. 5 It is now necessary to explain why the properties remain registered in the name of the trustees in bankruptcy even though Mr Docherty's bankruptcy has concluded. The ordinary period of a bankruptcy is 3 years: Bankruptcy Act 1996 (Cth) ('Bankruptcy Act') s 149. However, the end of a bankruptcy does not lead to the revesting of assets held by the trustees in bankruptcy which, if the administration is continuing, remain in the hands of the trustees. At the end of six years after a bankrupt is discharged from bankruptcy any property (other than cash) which remains in the hands of the trustees is reconveyed to the bankrupt unless the trustees issue an 'extension notice': s 129AA(2), (4). The extension notice may specify that the property does not revest until some later time not being more than a further 3 years from the current revesting time: s 129AA(4)-(6). It is a requirement that such an extension notice be given before any revesting has occurred (ie by the current revesting time): s 129AA(4). 6 In this case, the trustees issued extension notices in respect of the Llaandilo and Kingswood properties on or about 20 May 2019 ('the Extension Notices'). Mr Docherty (supported by Ms Montgomery) now alleges in this Court that the Extension Notices are invalid. To understand this engaging argument it is necessary to set out s 129AA in full: 129AA Time limit for realising property (1) This section applies only to: (a) property (other than cash) that was disclosed in the bankrupt's statement of affairs; and (b) after-acquired property (other than cash) that the bankrupt discloses in writing to the trustee within 14 days after the bankrupt becomes aware that the property devolved on, or was acquired by, the bankrupt. In this subsection, cash includes amounts standing to the credit of a bank account or similar account. (2) If any such property is still vested in the trustee immediately before the revesting time, then it becomes vested in the bankrupt at the revesting time by force of this section. (3) Initially, the revesting time for property is: (a) for property disclosed in the statement of affairs—the beginning of the day that is the sixth anniversary of the day on which the bankrupt is discharged from the bankruptcy; and (b) for after-acquired property that is disclosed before the bankrupt is discharged from the bankruptcy—the beginning of the day that is the sixth anniversary of the day on which the bankrupt is discharged; and (c) for after-acquired property that is disclosed after the bankrupt is discharged from the bankruptcy—the beginning of the day that is the sixth anniversary of the day on which the bankrupt disclosed the property to the trustee. (4) If the trustee, before the current revesting time, gives the bankrupt a written notice (an extension notice) stating that a later revesting time applies to particular property, then that later time becomes the revesting time for that property. (5) There is no limit on the number of extension notices that the trustee may give (either generally or in relation to particular property). (6) The time specified in an extension notice must be either: (a) a specified time that is not more than 3 years after the current revesting time; or (b) a time that is reckoned by reference to a specified event (for example, the death of a life tenant), but is not more than 3 years after the happening of that event. (7) Any property that becomes vested in the bankrupt under this section thereupon ceases to be subject to section 127. 7 The argument turns on subsections (3) and (6). There are two steps. First, the revesting time under subsection (3) is the beginning of the day that is the sixth anniversary of the day on which the bankrupt was discharged from the bankruptcy. Mr Docherty says, for reasons upon which I will shortly expand, that he was discharged from bankruptcy no later than the beginning of 2 August 2014. The Extension Notices issued by the trustees in bankruptcy, on the other hand, specified a new revesting time of 3 August 2023. This is a period of 3 years and one day after the latest date Mr Docherty says that he was discharged from bankruptcy. This is significant because subsection (6) only permits an extension to a 'specified time not more than 3 years after the current revesting time'. Mr Docherty seeks to argue therefore that the Extension Notices are not valid because they do not comply with subsection (6). 8 If the Extension Notices are invalid then the next step in Mr Docherty's argument is that subsection (2) then took its natural course on 2 August 2020, being the sixth anniversary of the latest day on which Mr Docherty says he was discharged from bankruptcy. Consequently, from at least that day Mr Docherty himself has been entitled to be the registered proprietor of both the Llandilo and Kingswood properties. If this proposition is correct then it will be seen that it has significant implications for the proceeding pending in the Supreme Court. In particular, it will remove the trustees in bankruptcy as Ms Montgomery's opponents and replace them with Mr Docherty who, as I have already observed, supports her claims. 9 The success or otherwise of Mr Docherty's argument turns upon when it was that he was discharged from bankruptcy. At this point it is necessary to descend into some detail. Section 149(4) of the Bankruptcy Act provides: (4) If the bankrupt becomes a bankrupt after the commencement of section 27 of the Bankruptcy Amendment Act 1991, the bankrupt is discharged at the end of the period of 3 years from the date on which the bankrupt filed his or her statement of affairs. 10 Perhaps somewhat counterintuitively therefore a person's bankruptcy does not commence for the purposes of s 149(4) unless and until a statement of affairs is filed. No doubt, this operates to provide a bankrupt with an incentive to file their statement of affairs promptly for the sooner it is lodged the sooner the 3 years mentioned in s 149(4) will expire. 11 The NPII records that Mr Docherty became bankrupt on 2 August 2011. Mr Docherty says, however, that he filed his debtor's petition and his statement of affairs on 29 July 2011. If Mr Docherty is correct then he was discharged 'at the end of the period of 3 years from' 29 July 2011: s 149(4). The latest that could be would be 30 July 2014 (there is a debate concerning the reckoning of time secreted within that statement but it does not matter on this limb of Mr Docherty's argument). In turn, s 129AA(3) then requires one to identify 'the sixth anniversary' of that date which would, on this view, be 30 July 2020. The power of the trustees to extend time under s 129AA(4) could not exceed a further 3 years from that date. Consequently, Mr Docherty says that the time specified in the Extension Notices (3 August 2023) is outside that prescribed 3 year period and was not authorised by s 129AA(4). For this reason he argues that the Extension Notices are invalid. 12 Mr Docherty also argues that even if his statement of affairs was filed on 2 August 2011 (as the NPII suggests) then he was discharged from his bankruptcy 'at the end of 3 years' from that date which he says was the end of 2 August 2014. The trustees by contrast say that 'at the end of 3 years' from 2 August 2011 is 3 August 2014. 13 The outcome of this debate turns on a number of matters. The first and chief matter is whether Mr Docherty filed his statement of affairs on the day he handed it over the counter (29 July 2011) or the day it was accepted along with his debtor's petition for filing (2 August 2011). Secondly, if it was filed on 2 August 2011, whether Mr Docherty was discharged from his bankruptcy on 2 August 2014 (as he contends) or 3 August 2014 (as the trustees contend). Thirdly, if the extension notice did specify a date not authorised by s 129AA(6)(a), whether this problem can be overcome by an order under s 33(1)(b) . Section 33 provides: 33 Adjournment, amendment of process and extension and abridgment of times (1) The Court may: (a) upon such terms as it thinks fit, at any time adjourn any proceeding before it, either to a fixed date or generally; (b) at any time allow the amendment of any written process, proceeding or notice under this Act; or (c) extend before its expiration or, if this Act does not expressly provide to the contrary, after its expiration, any time limited by this Act, or any time fixed by the Court or the Registrar under this Act (other than the time fixed for compliance with a bankruptcy notice), for doing an act or thing or abridge any such time. 14 Fourthly, if this problem cannot be overcome by s 33(1)(b), can it be surmounted by s 306? Section 306 provides: 306 Formal defect not to invalidate proceedings (1) Proceedings under this Act are not invalidated by a formal defect or an irregularity, unless the court before which the objection on that ground is made is of opinion that substantial injustice has been caused by the defect or irregularity and that the injustice cannot be remedied by an order of that court. (2) A defect or irregularity in the appointment of any person exercising, or purporting to exercise, a power or function under this Act or under a personal insolvency agreement entered into under this Act does not invalidate an act done by him or her in good faith. 15 Mr Docherty has commenced his proceeding in this Court seeking relief to vindicate these various propositions. He did so on 23 September 2021. The trustees have a filed a notice of grounds of opposition and a cross-claim along the lines of the debates I have just outlined. Subsequently, on 30 September 2021 the trustees filed their present application seeking, inter alia, the urgent transfer of this matter to be heard with Ms Montgomery's proceeding in the Supreme Court (which it will be recalled is scheduled to be heard for five days on 26 October 2021). Jurisdiction of the Supreme Court in Bankruptcy 16 The parties are in agreement that the Supreme Court has jurisdiction to entertain the suit and that a transfer is possible. Their agreement is supported by a Full Court decision which binds me. However, for the reasons I will now give I do not think that the Supreme Court does have jurisdiction with respect to this suit and the Full Court decision in question is, in my respectful opinion, erroneous. Nevertheless, in the light of that authority and the agreement of the parties I will proceed on the basis that the Supreme Court does have jurisdiction. 17 Prior to 1996 both the Federal Court and the State Supreme Courts were invested with jurisdiction 'in bankruptcy' by s 27 of the Bankruptcy Act. This was a broad jurisdiction whose width was repeatedly confirmed by the Full Court of this Court: see the authorities in Meriton Apartments Pty Limited v Industrial Court of New South Wales [2008] FCAFC 172; 171 FCR 380 ('Meriton') at [191]-[193]. As enacted, s 27 was in this form: (1) The Courts having jurisdiction in bankruptcy are— (a) the Federal Court of Bankruptcy; (b) the Supreme Court of the State of New South Wales; (c) the Court of Insolvency in and for the State of Victoria; (d) the Supreme Court of the State of Queensland; (e) the Court of Insolvency of the State of South Australia; (f) the Supreme Court of the State of Western Australia; (g) the Supreme Court of the State of Tasmania; and (h) the Supreme Court of the Northern Territory of Australia. (2) The State Courts specified in the last preceding sub-section are invested with federal jurisdiction in bankruptcy and jurisdiction in bankruptcy is conferred on the Supreme Court of the Northern Territory of Australia. (3) The jurisdiction with which State Courts are invested by this section is subject to the conditions and restrictions specified in sub-section (2) of section 39 of the Judiciary Act 1903-1965 so far as they are applicable and the jurisdiction conferred on the Supreme Court of the Northern Territory of Australia is subject to the restrictions specified in the next succeeding section. 18 Leaving aside some presently immaterial amendments (including to insert the name of this Court in place of the Federal Court of Bankruptcy upon its establishment in 1976) s 27 remained in largely the same form until 1996. 19 At the same time the courts of the States, including the Supreme Courts of the States, were invested with jurisdiction in matters arising under the laws of the Parliament by reason of s 39(2) of the Judiciary Act 1903 (Cth) ('Judiciary Act'). This included jurisdiction in matters arising under the Bankruptcy Act: Meriton at [81] per Greenwood J, [170], [249]-[250] per Perram J. As was pointed out in Meriton, this jurisdiction is not identical with jurisdiction 'in bankruptcy'. An example of jurisdiction arising under the Bankruptcy Act which is not jurisdiction in bankruptcy would be a suit in the Supreme Court of New South Wales to restrain the District Court of New South Wales from exercising bankruptcy jurisdiction. Such a suit would not be an exercise of jurisdiction in bankruptcy but it would be a proceeding arising under the Bankruptcy Act. 20 Thus as at 1988, a date the relevance of which I shortly explain, the Supreme Courts of the States had both jurisdiction in bankruptcy (by virtue of s 27 of the Bankruptcy Act) and jurisdiction in matters arising under the Bankruptcy Act (by virtue of s 39(2) of the Judiciary Act). These two jurisdictions were overlapping but far from identical. 21 The relevance of 1988 is this: on 1 July of that year there came into force the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) ('Cross-vesting Act'). Section 4 of the Cross-vesting Act provided at that time: Additional jurisdiction of certain Courts (1) Where (a) the Federal Court or the Family Court has jurisdiction with respect to a civil matter, whether that jurisdiction was or is conferred before or after the commencement of this Act; and (b) the Supreme Court of a State or Territory would not, apart from this section, have jurisdiction with respect to that matter, then (c) in the case of the Supreme Court of a State (other than the Supreme Court of the Northern Territory)—that court is invested with federal jurisdiction with respect to that matter; or (d) in the case of the Supreme Court of a Territory (including the Northern Territory)—jurisdiction is conferred on that court with respect to that matter. (2) Where (a) the Supreme Court of a Territory has jurisdiction with respect to a civil matter, whether that jurisdiction was or is conferred before or after the commencement of this Act; and (b) the Federal Court, the Family Court or the Supreme Court of a State or of another Territory would not, apart from this section, have jurisdiction with respect to that matter, jurisdiction is conferred on the court referred to in paragraph (b) with respect to that matter. (3) Where a proceeding is transferred to the Federal Court, the Family Court or a State Family Court of a State, that court has, by virtue of this sub-section, jurisdiction with respect to so many of the matters for determination in the proceeding as that court would not have apart from this sub-section. (4) This section does not apply to a matter arising under the Conciliation and Arbitration Act 1904 or under section 45d or 45e of the Trade Practices Act 1974. 22 At the time of its commencement, this provision did not confer jurisdiction on the State Supreme Courts either in bankruptcy or under the Bankruptcy Act because the pre-condition in s 4(1)(b) could not be satisfied. Each of the State Supreme Courts already had both types of jurisdiction and therefore it was not the case that 'apart from' s 4 those courts would have lacked jurisdiction. 23 In 1996, s 27 of the Bankruptcy Act was amended to remove the grant of jurisdiction in bankruptcy to the State Supreme Courts and to make jurisdiction in bankruptcy exclusive to the Federal Court and the Federal Circuit Court: Bankruptcy Legislation Amendment Act 1996 (Cth) ('the 1996 Amendment'). Section 27 as amended in 1996 was in this form: (1) The Federal Court has jurisdiction in bankruptcy, and that jurisdiction is exclusive of the jurisdiction of all courts other than the jurisdiction of the High Court under section 75 of the Constitution. 24 This was a profound alteration to the way in which bankruptcy had previously been handled in Australia. In Meriton the Full Court of this Court held that the effect of the 1996 Amendment was to work a repeal of s 39(2) of the Judiciary Act insofar as it conferred jurisdiction 'in bankruptcy': [81], [87] per Greenwood J, [171]-[172] per Perram J. 25 At the time of the 1996 Amendment to s 27, s 4 of the Cross-vesting Act was in this form: (1) Where: (a) the Federal Court or the Family Court has jurisdiction with respect to a civil matter, whether that jurisdiction was or is conferred before or after the commencement of this Act; and (b) the Supreme Court of a State or Territory would not, apart from this section, have jurisdiction with respect to that matter; then: (c) in the case of the Supreme Court of a State (other than the Supreme Court of the Northern Territory) - that court is invested with federal jurisdiction with respect to that matter; or (d) in the case of the Supreme Court of a Territory (including the Northern Territory) - jurisdiction is conferred on that court with respect to that matter. (2) Where: (a) the Supreme Court of a Territory has jurisdiction with respect to a civil matter, whether that jurisdiction was or is conferred before or after the commencement of this Act; and (b) the Federal Court, the Family Court or the Supreme Court of a State or of another Territory would not, apart from this section, have jurisdiction with respect to that matter; jurisdiction is conferred on the court referred to in paragraph (b) with respect to that matter. (3) Where a proceeding is transferred to the Federal Court, the Family Court or a State Family Court of a State, that court has, by virtue of this subsection, jurisdiction with respect to so many of the matters for determination in the proceeding as that court would not have apart from this subsection. (4) This section does not apply to a matter arising under: (a) the Conciliation and Arbitration Act 1904; or (b) the Industrial Relations Act 1988; or (ba) the Native Title Act 1993; or (c) section 46A, 155A or 155B of the Trade Practices Act 1974; or (d) a provision of Part VI or XII of the Trade Practices Act 1974 so far as the provision relates to section 46A, 155A or 155B of that Act. 26 At the legal moment when s 27 was amended to make this Court's jurisdiction in bankruptcy exclusive, s 4(1)(b) of the Cross-vesting Act became satisfied and s 4(1) then purported to confer on the State Supreme Courts the jurisdiction of which they had just been stripped, that is to say, jurisdiction 'in bankruptcy'. In other words, the Cross-vesting Act purported to preserve the non-exclusive jurisdiction which had just been made exclusive to this Court by the 1996 Amendment. For reasons which will be shortly relevant, it may be observed that what the Cross-vesting Act purported to do was inconsistent with what s 27 sought to achieve. The two enactments cannot stand together. 27 The Explanatory Memorandum ('EM') to the Bill which provided for the 1996 Amendment addressed the relationship between the newly exclusive jurisdiction in s 27 and the jurisdiction conferred by s 4 of the Cross-vesting Act. The following passages (at [3](i), [81]-[82] of the EM) draw a distinction between, on the one hand, jurisdiction 'in bankruptcy' which the 1996 Amendment withdrew from State courts and, on the other hand, jurisdiction to deal with 'bankruptcy matters' which was to remain with State courts by virtue of the Cross-vesting Act: The amendments to the Act fall into 15 main categories, as follows: … (i) conferring jurisdiction in bankruptcy on the Federal Court of Australia to the exclusion of courts other than the High Court under the Constitution, and the defunct Federal Court of Bankruptcy, subject to the cross vesting of jurisdiction scheme provided for in the Jurisdiction of Courts (Cross Vesting) Act 1987 and complementary State and Territory legislation … 81 The Act gives jurisdiction in bankruptcy to the Federal Court of Australia, the Supreme Courts of the States and the Supreme Court of the Northern Territory. By far the majority of bankruptcy cases are dealt with in the Federal Court, although from time to time, bankruptcy matters are instituted in a Supreme Court. All creditor's petitions are dealt with by the Federal Court, because its district registrars and deputy district registrars hold office as Registrars in Bankruptcy. To preserve the situation that creditor's petitions are dealt with in the Federal Court, the Bill proposes amendments to the Act to give that Court jurisdiction in bankruptcy exclusive of the jurisdiction of courts other than the High Court under the Constitution. For the time being references to the Federal Court of Bankruptcy have been retained even though that Court was abolished in September 1995 and has ceased to function. Those references will be removed as soon as practicable. 82 Bankruptcy matters will still be able to be dealt with by Supreme Courts of the States and the Northern Territory under the Jurisdiction of Courts (Cross-Vesting) Act 1987 in appropriate cases. Further, provisions which enable trustees to take action in courts of competent jurisdiction for the recovery of debts from bankrupts and other persons, such as sections 139ZG, subsections 139ZL(10) and 139ZQ(8) and subsection 161B(2), will be unaffected, and actions pursuant to those sections will be able to be commenced, as at present in a magistrates court, District or County Court or Supreme Court as appropriate. 28 In Meriton I explained that this passage rested on an erroneous understanding of what jurisdiction in bankruptcy was. It was not just the jurisdiction to hear applications (such as creditors' petitions) under the Bankruptcy Act as the passage assumes. It was in fact a far broader jurisdiction. It is apparent therefore that the exclusive jurisdiction conferred by s 27 is not what the Parliament thought it was doing. However, the words it has used in s 27 are beyond clear and the consequences of this Parliamentary error are not to be averted merely because they are inconvenient. 29 In my view, for the same reasons that s 39(2) was impliedly repealed on the amendment to s 27, so too was s 4(1) of the Cross-vesting Act insofar as it would otherwise have conferred jurisdiction 'in bankruptcy' on State Supreme Courts. Section 4(1)'s conferral of jurisdiction in bankruptcy on State Supreme Courts and s 27's express statement that the State Supreme Courts are to have no such jurisdiction are irreconcilably inconsistent. 30 There is binding authority, however, to the contrary: Truthful Endeavour Pty Ltd v Condon (Trustee), in the matter of Rayhill (Bankrupt) [2015] FCAFC 70; 233 FCR 174 ('Truthful Endeavour') at [34], [60]. In the course of its reasons in that case, the Full Court referred to two decisions of present relevance: the judgment of Vickery J in Gorkowski v Turner [2014] VSC 200; 285 FLR 66 ('Gorwkowski') which relied on the Full Court of this Court in Re Wilcox; Ex parte Venture Industries Pty Ltd (1996) 66 FCR 511 ('Re Wilcox'). The Full Court in Truthful Endeavour held that Gorkowski was wrongly decided because it held, erroneously, that a case concerning the trustee's title to property under ss 58(1) and 116(1) of the Bankruptcy Act was not a 'special federal matter' under the Cross-vesting Act: Truthful Endeavour at [57], [60]. It is useful to set out the following passages from [42] and [44]-[45] of the Full Court's reasons in Truthful Endeavour: [Vickery J] then considered the effect of the Cross-vesting Act, and first, the vesting of jurisdiction by s 4(1) of that Act. In short, his Honour reasoned, the effect of that (later) statute upon the (earlier) Bankruptcy Act was to impliedly repeal that part of s 27 of the Bankruptcy Act as provides for exclusive jurisdiction in the Federal Court and Federal Circuit Court. In so concluding at [21]-[37], his Honour relied on a decision of the Full Court of this Court in Re Wilcox. In Re Wilcox, the Court concluded that the investing of jurisdiction in State Supreme Courts by s 4(1) of the Cross-vesting Act was effective to "disturb" (for this language, see Re Wilcox at 525B, that is, impliedly repeal) the pre-existing regime of exclusive jurisdiction, unless a specific exclusion to the operation of s 4(1) was found in s 4(4) of the Cross-vesting Act, identifying matters arising under nominated statutes. Having concluded that the Supreme Court was invested with jurisdiction by s 4(1) of the Cross-vesting Act (notwithstanding the terms of s 27 of the Bankruptcy Act), his Honour then proceeded to deal with the question of whether "bankruptcy was a special federal matter" … [It] is helpful to refer in a little more detail to investing of federal jurisdiction in State courts and to the Cross-vesting Act. Section 4(1) of the Cross-vesting Act provides, relevantly, that where the Federal Court has jurisdiction with respect to a civil matter (whether conferred before or after commencement of the Cross-vesting Act) and a Supreme Court would not, apart from this section, have jurisdiction with respect to the matter, then the Supreme Court is invested with federal jurisdiction in respect of the matter. State courts are invested (subject to various qualifications and conditions by the mechanics of withdrawal and simultaneous investing in s 39(1) and (2) of the Judiciary Act) with federal jurisdiction in all matters referred to in ss 75 and 76 of the Constitution. This includes s 76(ii) — any matter arising under any law made by Parliament. Specific statutes may qualify or restrict that general investing. An example is s 27 of the Bankruptcy Act which provides for exclusive jurisdiction of two federal courts in bankruptcy. The authority of Parliament to make jurisdiction in federal courts exclusive is contained in s 77(ii) of the Constitution. Section 4(4) of the Cross-vesting Act lists various statutes and statutory provisions to which "[t]his section does not apply to a matter arising under". The Bankruptcy Act and provisions of it is, and are, not mentioned in s 4(4). Hence, on the reasoning of Re Wilcox, the judge concluded that s 4(1) operated to impliedly repeal s 27(1) of the Bankruptcy Act insofar as it provided for exclusive jurisdiction of the two named federal courts. 31 In Re Wilcox it was held that the exclusive grant of jurisdiction to this Court in matters under Pt V of the Trade Practices Act 1974 (Cth) was overcome by s 4 of the Cross-vesting Act because Pt V was not mentioned in s 4(4). However, the exclusive jurisdiction in Pt V was enacted before s 4, hence the reference in Truthful Endeavour (above) to Re Wilcox being concerned with the operation of s 4 on a 'pre-existing regime of exclusive jurisdiction'. 32 It can thus be seen that the reasoning in Gorkowski, with respect, relied on an inaccurate understanding of legislative history. The starting point is that although the Cross-vesting Act post-dates the Bankruptcy Act, the exclusive jurisdiction in s 27 post-dates the Cross-vesting Act. The plaintiff in Gorkowski drew the court's attention to this but submitted, in reliance on [82] of the EM (above [27]), that despite its express terms the 1996 Amendment did not in fact render jurisdiction in bankruptcy exclusive to this Court because that jurisdiction was preserved non-exclusive by s 4(1) of the Cross-vesting Act. The court accepted this submission: [33], [37]. It is, with respect, incorrect in two respects. First, it fails to apprehend the distinction between jurisdiction 'in bankruptcy' and other jurisdiction under the Bankruptcy Act. 33 Secondly, it ignores the principle of construction that an enactment works an implied repeal of an earlier enactment with which it is inconsistent, meaning where the two enactments are in a state of contrariety that cannot be resolved by a harmonious reading: Goodwin v Phillips (1908) 7 CLR 1 at 7 per Griffiths CJ, 10 per Barton J; Potier v Attorney-General (NSW) [2015] NSWCA 129; 89 NSWLR 284 at [53] per Leeming JA; Commissioner of Police v Eaton [2013] HCA 2; 252 CLR 1 at [95]-[100] per Gageler J. The construction accepted in Gorkowski leaves unresolved a clear inconsistency between the earlier and later enactment which pull in opposite directions on the grant of jurisdiction in bankruptcy. The better view is that the 1996 Amendment impliedly repealed s 4(1) to the extent the latter would confer jurisdiction 'in bankruptcy' on State Supreme Courts. 34 Subsequent to the amendment of s 27, s 4(4) was further amended to add other statutes (and to reflect the legislative reform culminating in the Competition and Consumer Act 2010 (Cth)), namely the: (a) Fair Work Act 2009; (b) Building and Construction Industry (Improving Productivity) Act 2016; (c) Fair Work (Registered Organisations) Act 2009; (d) Fair Work (Transitional Provisions and Consequential Amendments) Act 2009; and (e) Workplace Relations Act 1996. 35 I am unable to discern how the addition of any of those statutes can have operated to repeal the exclusive operation of s 27. 36 The New South Wales Court of Appeal in Mateljan v HTT Huntley Heritage Pty Ltd [2016] NSWCA 20; 111 ACSR 277 was alert to the difficulty of pinning down the interaction between the Cross-vesting Act and s 27 post-1996, noting at [27]: Although s 27 uses the language of "exclusive" jurisdiction and is an exercise of power under s 77(ii) of the Constitution, that is not the end of the inquiry. Until 1996, jurisdiction had been invested in the Supreme Court, and the problem now confronted by Mr Mateljan would not have arisen. The Supreme Court is invested with federal jurisdiction under s 4(1) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth) in cases where it would not otherwise have jurisdiction. This is significant because under s 6, a special federal matter must be transferred to the Federal Court unless the court is satisfied that there are "special reasons". The foregoing was not the subject of argument (although the question of jurisdiction was raised, briefly, during the course of the hearing). How these provisions work is far from straightforward, and it is neither necessary nor appropriate in these proceedings to determine the question conclusively. However, there is clear authority for the proposition that a matter in bankruptcy is a "special federal matter" within the meaning of s 3(1) of that Act. 37 I agree that the issue is far from straightforward. That said, once proper regard is had to the legislative history and the authorities discussed above, it is tolerably clear that: (a) Re Wilcox is silent on the current situation; and (b) the better view is that the 1996 Amendment worked an implied repeal of s 4(1) of the Cross-vesting Act to the extent that the latter conferred jurisdiction in bankruptcy on State Supreme Courts. 38 Indeed one may go a step further: because s 39(2) of the Judiciary Act continues to confer on State courts jurisdiction in matters under the Bankruptcy Act, s 4(1) of the Cross-vesting Act is in truth a provision that does not operate upon federal bankruptcy jurisdiction. To the extent it would confer jurisdiction 'in bankruptcy' it has been repealed by the 1996 Amendment; to the extent it would confer jurisdiction under the Bankruptcy Act there is no occasion for it to do so because that is achieved by s 39(2) of the Judiciary Act and therefore the proviso in s 4(1)(b) of the Cross-vesting Act is not satisfied. Put another way, the Supreme Courts continue to have jurisdiction under the Bankruptcy Act insofar as it is not jurisdiction in bankruptcy. Section 4(1) of the Cross-vesting Act is irrelevant to that outcome. 39 The view that the later enactment, s 27, means what it says – that the jurisdiction in bankruptcy is exclusive to the federal courts – and that the later enactment of s 27 has not been inexplicably repealed by the earlier enactment of s 4 of the Cross-vesting Act (as Gorkowski appears to accept) – has significant consequences for bankruptcy litigation. 40 As a matter of constitutional jurisprudence a 'matter' is a single justiciable controversy not an individual legal proceeding: Palmer v Ayres [2017] HCA 5; 259 CLR 478 at [26] per Kiefel CJ, Keane, Nettle and Gordon JJ; Caason Investments Pty Ltd v International Litigation Partners No.3 Ltd [2018] FCAFC 176; 265 FCR 487 ('Caason') at [57] per Allsop CJ, Middleton and Perram JJ. A 'matter' can therefore extend beyond the parties to a given proceeding, across multiple proceedings in the same court, and across proceedings in different courts: Caason at [58]; Fencott v Muller (1983) 152 CLR 570 ('Fencott v Mueller') at 603 per Mason, Murphy, Brennan and Deane JJ; Re Wakim; Ex parte McNally [1999] HCA 27; 198 CLR 511 at [138] per Gummow and Hayne JJ; Hodges v Waters (No 7) [2015] FCA 264 at [43]. 41 Whether or not multiple proceedings indeed form part of the same 'matter' is a question of 'practical judgment' that 'depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships': Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 ('Stack') at 294 per Mason, Brennan and Deane JJ; Re Wakim; Ex parte McNally at [135], [140] per Gummow and Hayne JJ. There is no hard and fast rule and the inquiry is inherently impressionistic: Stack at 294. 42 Where it is found that two proceedings pending in different courts form part of the same matter, difficult jurisdictional questions can arise. Especially is this so where proceedings in the same matter are separately constituted in this Court and a State Supreme Court. In such a case, where this Court has exclusive federal jurisdiction to determine an aspect of the matter, it also has accrued jurisdiction to determine the non-federal (and therefore non-exclusive) aspects, provided the federal aspect is at least a substantial one: Fencott v Muller at 609 per Mason, Murphy, Brennan and Deane JJ. Although this Court is not bound to exercise the non-federal jurisdiction, the High Court has held that for it to exercise only the federal aspects, and leave the balance of the dispute unresolved, will generally be an inappropriate course (Fencott v Muller at 608): A judicial power which is not exercised to determine the whole of a controversy is, generally speaking, not appropriately and conveniently exercised. Not appropriately, because the controversy is not quelled; not conveniently, because the parties - the principal beneficiaries of the exercise of judicial power - must litigate anew to have the outstanding questions and issues determined. 43 Thus, in a case where such a matter is split between this Court and a State Supreme Court, the consequence is that both courts have jurisdiction to proceed, this Court possessing jurisdiction to determine the whole of the dispute and the Supreme Court the jurisdiction to determine the dispute shorn of its federal aspects: Stack at 297 per Mason, Brennan and Deane JJ. Because it is obviously undesirable that both courts should set about determining largely the same issues, a choice must be made as to which court is the appropriate forum: Stack at 297; Re Wakim; Ex Parte McNally at [218] per Kirby J. Normally, in such a case, that will be this Court. 44 It is not necessary to explore this issue further. Because I am bound by Truthful Endeavour to conclude that the Supreme Court does have jurisdiction in bankruptcy it would not be useful to examine further how the present application might be determined if it were concluded that the Supreme Court had no jurisdiction in bankruptcy. Special Federal Matter 45 The parties are in agreement that this proceeding, if transferred, will upon its arrival in the Supreme Court be a 'special federal matter' within the meaning s 6 of the Cross-vesting Act. Section 6 of the Cross-vesting Act will then require that the Supreme Court transfer the suit to this Court unless it is satisfied that there are 'special reasons' not to do so: s 6(3). That provision makes clear that 'special reasons' do not include 'the convenience of the parties'. What is a 'special federal matter'? The expression is defined in s 3 in these terms: special federal matter means: (a) a matter arising under Part IV of the Competition and Consumer Act 2010 (other than under section 45D, 45DA, 45DB, 45E or 45EA); or (aa) a matter arising under the Competition Code (as defined in section 150A of the Competition and Consumer Act 2010) of the Australian Capital Territory or the Northern Territory; or (ab) a matter arising under section 60G of the Family Law Act 1975 in a court other than the Family Court of Western Australia or the Supreme Court of the Northern Territory; or (b) a matter involving the determination of questions of law on appeal from a decision of, or of questions of law referred or stated by, a tribunal or other body established by an Act or a person holding office under an Act, not being a matter for determination in an appeal or a reference or case stated to the Supreme Court of a State or Territory under a law of the Commonwealth that specifically provides for such an appeal, reference or case stated to such a court; or (c) a matter arising under the Administrative Decisions (Judicial Review) Act 1977; or (e) a matter that is within the original jurisdiction of the Federal Court by virtue of section 39B of the Judiciary Act 1903; being a matter in respect of which the Supreme Court of a State or Territory would not, apart from this Act, have jurisdiction. 46 Section 6 provides: 6 Special federal matters: general rules (1) If: (a) a matter for determination in a proceeding that is pending in the Supreme Court of a State or Territory is a special federal matter; and (b) the court does not make an order under subsection (3) in respect of the matter; the court must transfer the proceeding in accordance with this section to the Federal Court or a court mentioned in paragraph (2)(b). Note: This section has effect subject to section 6A (Special federal matters: Commonwealth authorities or officers acting under the laws of States). (1A) However, the court must only transfer so much of the proceeding as is, in the opinion of the court, within the jurisdiction (including the accrued jurisdiction) of the Federal Court, or the court mentioned in paragraph (2)(b), as the case may be. (2) If the court orders that a proceeding or part of a proceeding be transferred, the proceeding or part of the proceeding must be transferred: (a) if the matter for determination in the proceeding is a matter mentioned in paragraph (a), (b), (c) or (e) of the definition of special federal matter in subsection 3(1)—to the Federal Court; or (b) if the matter for determination in the proceeding is a matter mentioned in paragraph (ab) of that definition—to whichever of the Federal Circuit and Family Court of Australia (Division 1), the Family Court of Western Australia or the Supreme Court of the Northern Territory, in the opinion of the court, is appropriate in the circumstances. (3) The Supreme Court may order that the proceeding be determined by that court if it is satisfied that there are special reasons for doing so in the particular circumstances of the proceeding other than reasons relevant to the convenience of the parties. (4) Before making an order under subsection (3), the court must be satisfied that: (a) a written notice specifying the nature of the special federal matter has been given to the Attorney-General of the Commonwealth and the Attorney-General of the State or Territory where the proceeding is pending; and (b) a reasonable time has elapsed since the giving of the notice for the Attorneys-General to consider whether submissions to the court should be made in relation to the proceeding. (5) For the purposes of subsection (4), the court: (a) may adjourn the proceeding for such time as the court thinks necessary and may make such order as to costs in relation to an adjournment as it thinks fit; and (b) may direct a party to the proceeding to give a notice in accordance with that subsection. (6) In considering whether there are special reasons for the purposes of subsection (3), the court must: (a) have regard to the general rule that special federal matters should be heard by the Federal Court or a court mentioned in paragraph (2)(b), whichever is appropriate in the particular case; and (b) take into account any submission made in relation to the proceeding by an Attorney-General mentioned in subsection (4). (7) The Attorney-General may authorise the payment by the Commonwealth to a party of an amount in respect of costs arising out of the adjournment of a proceeding under this section, under a corresponding provision of a law of a State or under this section and under such a provision. (8) Nothing in this section prevents the court granting urgent relief of an interlocutory nature if it is in the interests of justice to do so. (9) Where, through inadvertence, the Supreme Court of a State or Territory determines a proceeding of the kind mentioned in subsection (1) without: (a) the court making an order under subsection (3) that the proceeding be determined by that court; or (b) a notice mentioned in subsection (4) being given; nothing in this section invalidates the decision of that court. (10) This section does not apply to an appeal that is instituted in the Full Court of the Supreme Court of a State or Territory if the court whose decision is the subject of the appeal had made an order under subsection (3), or under subsection 6(1) as in force before the commencement of the amendments of this Act made by the Law and Justice Legislation Amendment Act (No. 3) 1992, in relation to the special federal matter. 47 The immediate problem arises from the reference to s 39B of the Judiciary Act in clause (e) of the definition of 'special federal matter'. As s 39B stood when the Cross-vesting Act was enacted, it conferred jurisdiction on this Court of the kind conferred on the High Court by s 75(v) of the Constitution. This is the jurisdiction possessed by the High Court to hear suits in which a writ of mandamus or prohibition or an injunction is sought against an officer of the Commonwealth. 48 It is clear why the drafter decided that such matters should be called 'special federal matters'. The exercise of this jurisdiction would have empowered the State Supreme Courts to supervise the executive power of the Commonwealth. It is not difficult to fathom that the Parliament might prefer its own officials' decisions to be reviewed by its own system of courts. 49 Section 39B was amended in 1997 to confer additional jurisdiction on this Court in matters arising under the laws made by the Parliament (as contemplated by s 76(i) and s 77 of the Constitution): s 39B(1A)(b), inserted by the Law and Justice Legislation Amendment Act 1997 (Cth). No corresponding change was made to the definition of a 'special federal matter' in the Cross-vesting Act. The reference to s 39B in that definition is ambulatory, picking up whatever s 39B happens to include at the time the question is asked: Acts Interpretation Act 1901 (Cth) s 10. The consequence has been that any matter which arises under the laws of the Parliament is now a 'special federal matter' if the jurisdiction of the Supreme Court depends solely on the Cross-vesting Act. 50 I accept on the present state of the authorities that the proceeding in this Court will, upon its arrival in the Supreme Court, be a special federal matter. There are several steps. First, this Court has jurisdiction in the present suit from two sources: the Bankruptcy Act, s 27 (as a matter in bankruptcy) and the Judiciary Act 1903, s 39B(1A)(c) (as a matter arising under the Bankruptcy Act). Secondly, it therefore answers the description in clause (e) of the definition of a 'special federal matter' in the Cross-vesting Act. Thirdly, upon its arrival in the Supreme Court that court will only have jurisdiction over this case by reason of s 4(1) of the Cross-vesting Act. It is true that this proceeding will also be in its accrued jurisdiction to deal with the matter which is already before it, but that accrued jurisdiction likewise rests on s 4(1) of the Cross-vesting Act. Consequently, this case will be a special federal matter. 51 The Supreme Court will therefore be required to consider the implications of s 6 of the Cross-vesting Act. In turn this will require it to identify 'special reasons' beyond the convenience of the parties why the matter should remain before it and not be transferred to this Court. However, whilst the Supreme Court must transfer a special federal matter to the Federal Court unless satisfied that there are 'special reasons' not to do so, the power of this Court to transfer a special federal matter to the Supreme Court is not so circumscribed. Whilst I accept that the fact that the Supreme Court will need to consider the implications of s 6 upon this matter's arrival is a relevant matter in the exercise of my discretion, I do not regard it as definitive. This Court can lawfully transfer a special federal matter to the Supreme Court even if is not satisfied that there are 'special reasons' within the meaning of s 6. 52 Since this would create a potential infinite regress where the matter is transferred endlessly between the two courts it is important to identify a circuit-breaker. In my opinion, the circuit breaker would be the fact that this Court has transferred the special federal matter to the Supreme Court. That fact would constitute a 'special reason' within the meaning of 6. In that circumstance, if this Court transferred the matter to the Supreme Court I conclude that it is unlikely that the Supreme Court would transfer the proceeding back. How Should the Discretion be Exercised? 53 In my view, this is straightforward. At the time I pronounced the orders the proceeding in the Supreme Court was listed for hearing on 26 October 2021. There is no practical way this Court could conclude the proceeding before it by that date and it is even less likely that any appeal could be determined by that date. The only way the validity of the Extension Notices may be determined in a timely fashion is if they are determined by the Supreme Court. 54 The parties appeared to accept that if the proceeding were transferred it would likely cause the adjournment of the hearing in the Supreme Court. There also seemed to be little dispute that Mr Docherty is very unwell at the moment. If the Supreme Court proceeding is adjourned, it is clear that the validity of the Extension Notices will need to be resolved in a timeframe which accommodates that problem. I do not think that the question of the validity of the Extension Notices ought properly to be determined in a different court to that in which the principal dispute is constituted. As I have already noted, the problems become particularly acute when one starts considering what will happen if an appeal is lodged in this proceeding. 55 It was for these reasons that I ordered the transfer of the proceeding to the Supreme Court on Friday last. I certify that the preceding fifty-five (55) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Perram. Associate: Dated: 11 October 2021