Supreme Court New South Wales Medium Neutral Citation: Botany Auto Panel Beating Pty Ltd v Glenn Alderman [2014] NSWSC 1376 Hearing dates: 1 October 2014 Decision date: 09 October 2014 Jurisdiction: Common Law Before: Schmidt J Decision: The plaintiff's summons be dismissed. The usual order as to costs is that costs follow the event. In this case that would be an order that the plaintiff pay Mr Alderman's costs, as agreed or assessed. Unless the parties approach within 7 days to be heard, that will be the Court's order as to costs. Catchwords: ADMINISTRATIVE LAW - application to set aside orders of Local Court - whether self-represented plaintiff can appear on behalf of corporation - summons dismissed Legislation Cited: Bankruptcy Act 1966 (Cth) Civil Procedure Act 2005 (NSW) Local Court Act 2007 (NSW) Supreme Court Act 1970 (NSW) Uniform Civil Procedure Rules 2005 (NSW) Cases Cited: Roger Whalebone v Derek Andrews (District Court of NSW, 10 February 2014, unreported, Truss DCJ) Category: Principal judgment Parties: Botany Auto Panel Beating Ltd (Plaintiff) Glenn Alderman (Defendant) Representation: Counsel: Mr J Cohen (Defendant) Solicitors: Mr R Whalebone, self-represented (Plaintiff) File Number(s): 2014/69803 Publication restriction: None Judgment 1By summons filed on 6 March 2014, the plaintiff company appeals from orders made by Cohen LCM in the Local Court in January 2014, dismissing a motion there brought by the plaintiff. 2The Local Court proceedings were brought in 2012 and were consolidated with proceedings brought by the defendant, Mr Alderman (matter numbers 126074 and 115660 respectively). The proceedings were concerned with the plaintiff's claim for some $20,000 due, he claimed, under a contract for the repair of a motor vehicle. That vehicle remains in the plaintiff's possession. In these proceedings the plaintiff complains that as the result of the dismissal of its claims, Mr Alderman is pursuing it by statutory demand, even though it has brought this appeal and the merits of their dispute have never been heard. 3In January 2014, the plaintiff was seeking orders to set aside his Honour's dismissal of another motion, which had been dealt with in October 2013. That motion was brought after judgment had been entered in favour of Mr Alderman by orders made by Pierce LCM in June 2013, in the plaintiff's absence. The plaintiff later filed a motion seeking to have that judgment set aside. It was that motion which came before the Court for hearing in October, when there was also no appearance for the plaintiff. That motion was then dismissed. In January 2014 the plaintiff pursued orders setting aside the dismissal of the first motion. The second motion was also dismissed, O'Brien LCM not being satisfied that the plaintiff had provided an adequate explanation for its failures to appear at the earlier hearings. 4Section 39 of the Local Court Act 2007 (NSW) grants a right of appeal to this Court from a Local Court decision only on a question of law. By the summons the plaintiff also relied on s 69 of the Supreme Court Act 1970 (NSW). 5At the hearing in January in the Local Court, Mr Whalebone appeared. He was formally a director of the plaintiff but was then a bankrupt. His wife, Ms Han Ying Whalebone, then a director and the secretary of the plaintiff, was present. She had given Mr Whalebone written authorisation to appear for the plaintiff. That authorisation described him to be the plaintiff's "Manager/Assistant Secretary". 6The defendant, Mr Alderman, objected to Mr Whalebone being heard, he then being an undischarged bankrupt. He submitted that the plaintiff's motion should be dismissed, because the plaintiff was not entitled to be represented by Mr Whalebone. That application did not succeed and O'Brien LCM permitted Mr Whalebone to advance the plaintiff's case. 7Having heard the parties O'Brien LCM dismissed the plaintiff's application, observing that in April 2013 the matter had been fixed for hearing in June; the plaintiff was then legally represented; and that in June, shortly before the hearing fixed for 17 June, its solicitors had filed a notice of ceasing to act in terms which revealed that they were aware of the hearing date. His Honour inferred that the plaintiff was in those circumstances also aware of the hearing but had not appeared. It had also not appeared in October to press its motion to have the orders made in June set aside, with the result that orders dismissing the motion were also made in its absence. 8Somewhat curiously, the error of law which Mr Whalebone, who again appeared for the plaintiff on appeal, this time without objection, advanced for the plaintiff was that O'Brien LCM had erred in permitting him to appear for the plaintiff in the Local Court. On his submissions, given the requirements of s 60 of the Bankruptcy Act 1966 (Cth), he then being a bankrupt, his Honour should have upheld the objection to his appearance and stayed the hearing of the plaintiff's motion. 9For his part Mr Alderman now accepts that the plaintiff was entitled to be represented by Mr Whalebone in the Local Court and that his Honour had not erred in permitting that representation. Mr Alderman's case was that at the time of the Local Court proceedings he was not aware that Mrs Whalebone was a director of the company or of her written authorisation of Mr Whalebone's appearance. He accepted, however, that those circumstances supported the exercise of the Court's discretion to permit Mr Whalebone's appearance in the Local Court, a discretion which O'Brien LCM had in any event. 10It seems to me that submission must be accepted and that the plaintiff's appeal must be dismissed. 11Under the Local Court Act, relevant provision as to representation is made in s 57 and s 59, which relevantly provide: "57 Right of representation (cf LCA 1982, section 50) (1) An applicant or respondent may appear personally or by an Australian legal practitioner or other representative empowered by an Act or other law to appear for the applicant or respondent. ... 58 Conduct of case (cf LCA 1982, section 51) (1) The applicant's case may be conducted by the applicant or by the applicant's Australian legal practitioner or any other representative permitted to appear for the applicant (whether under this or any other Act). ..." 12Rule 7.1 of the Uniform Civil procedure Rules 2005 (NSW) also applied to the Local Court. It provides: "7.1 By whom proceedings may be commenced and carried on (1) ... (1A) ... (2) A company within the meaning of the Corporations Act 2001 of the Commonwealth: (a) may commence and carry on proceedings in any court by a solicitor or by a director of the company, and (b) may commence and, unless the court orders otherwise, carry on proceedings in the Local Court by a duly authorised officer or employee of the company. (3) .... (4) A corporation (other than a company within the meaning of the Corporations Act 2001 of the Commonwealth): (a) may commence and carry on proceedings in any court by a solicitor, and (b) may commence and carry on proceedings in any court (other than the Local Court) by a duly authorised officer of the corporation, and (c) may commence and, unless the court orders otherwise, carry on proceedings in the Local Court by a duly authorised officer or employee of the corporation. (4A) ... (4B) ... (5) ... (6) ..." 13It follows that the Local Court had a discretion to permit Mr Whalebone to appear for the plaintiff as he was authorised to do. That discretion was exercised in its favour, over Mr Alderman's objection. No error in the exercise of that discretion is apparent. 14On appeal the plaintiff's case was that rather than exercising that discretion in its favour, his Honour should have either adjourned the proceedings or stayed them, in the same way that Truss DCJ had stayed other proceedings which Mr Whalebone had brought personally in the District Court. On his submissions, those proceeding were concerned with a dispute about a similar contract to that entered between the plaintiff and Mr Alderman. 15In the District Court proceedings Truss DCJ was dealing with the provisions of s 60 of the Bankruptcy Act, which provides: "60 Stay of legal proceedings (1) The Court may, at any time after the presentation of a petition, upon such terms and conditions as it thinks fit: (a) discharge an order made, whether before or after the commencement of this subsection, against the person or property of the debtor under any law relating to the imprisonment of fraudulent debtors and, in a case where the debtor is imprisoned or otherwise held in custody under such a law, discharge the debtor out of custody; or (b) stay any legal process, whether civil or criminal and whether instituted before or after the commencement of this subsection, against the person or property of the debtor: (i) in respect of the non‑payment of a provable debt or of a pecuniary penalty payable in consequence of the non‑payment of a provable debt; or (ii) in consequence of his or her refusal or failure to comply with an order of a court, whether made in civil or criminal proceedings, for the payment of a provable debt; and, in a case where the debtor is imprisoned or otherwise held in custody in consequence of the non‑payment of a provable debt or of a pecuniary penalty referred to in subparagraph (i) or in consequence of his or her refusal or failure to comply with an order referred to in subparagraph (ii), discharge the debtor out of custody. (2) An action commenced by a person who subsequently becomes a bankrupt is, upon his or her becoming a bankrupt, stayed until the trustee makes election, in writing, to prosecute or discontinue the action. (3) If the trustee does not make such an election within 28 days after notice of the action is served upon him or her by a defendant or other party to the action, he or she shall be deemed to have abandoned the action. (4) Notwithstanding anything contained in this section, a bankrupt may continue, in his or her own name, an action commenced by him or her before he or she became a bankrupt in respect of: (a) any personal injury or wrong done to the bankrupt, his or her spouse or de facto partner or a member of his or her family; or (b) the death of his or her spouse or de facto partner or of a member of his or her family. Note: See also subsection 5(6). (4A) Notwithstanding paragraph (1)(b), this section does not empower the Court to stay any proceedings under a proceeds of crime law. (5) In this section, action means any civil proceeding, whether at law or in equity." 16Truss DCJ there noted at [11] evidence that Mr Whalebone's trustee in bankruptcy had notified the defendant to those proceedings that he had elected to discontinue the District Court proceedings. In the circumstances, her Honour ordered that they be stayed (see Roger Whalebone v Derek Andrews (District Court of NSW, 10 February 2014, unreported). 17On the plaintiff's case, O'Brien LCM had an obligation to assist it, given that it was not legally represented. In the result, his Honour had erred in not adjourning or staying the hearing of its motion, as Truss DCJ had approached Mr Whalebone's proceedings before her, in accordance with s 60 of the Bankruptcy Act. 18These submissions cannot be accepted. No error of law has thereby been established, which warrants the relief which the plaintiff pursues in this Court. 19The plaintiff's situation was not like that of Mr Whalebone. The Bankruptcy Act did not apply to the plaintiff. Unlike the proceedings before Truss DCJ, s 60 of that Act had no application to the proceedings which the plaintiff had brought in the Local Court. Further, the plaintiff sought no stay of its application. To the contrary, its director Mrs Whalebone had authorised Mr Whalebone to appear for it, despite his bankruptcy. She was present when he advanced submissions to resist Mr Alderman's objection to his appearance, on the plaintiff's behalf. His appearance was pressed because it was plainly in the plaintiff's interests to advance its case on the motion. Unless that application succeeded, it could not pursue the debt which it claimed Mr Alderman owes it. 20O'Brien LCM concluded as to that application: "On the question of whether or not there is a proper standing for... Mr Whalebone today, I confess that my knowledge of the Bankruptcy Act is deficient as to that. I am not aware, I certainly have allowed him to be heard today and I have not made a ruling that he not be heard. I do not think that would be in the interests of justice, it is appropriate to allow Mr Whalebone to say what it is he would like to say." 21No error of law has been established in the conclusion so reached. His Honour was entitled so to exercise the Court's discretion to permit the plaintiff to proceed with the representation it had determined to have at the hearing of its motion. That involved no error of law. The Bankruptcy Act made no relevant provision. Accordingly, this appeal must fail. 22The plaintiff did not seek to establish any other error of law in his Honour's refusal of its application. His Honour concluded that in circumstances where the plaintiff had not appeared to press its case at the hearing on 17 June, and when it also did not appear when its motion to set aside that judgment was listed for hearing in October, which was thus also dismissed, in the absence of any adequate explanation for those non-appearances, the relief sought by the plaintiff's further motion had to be refused. In coming to his conclusions his Honour bore in mind the obligations imposed by s 56 of the Civil Procedure Act 2005 (NSW), the just, quick and cheap resolution of the real issues in the proceedings. At that point those issues were concerned with the dismissal of the plaintiff's first motion and whether those orders should be set aside. 23The end result of O'Brien LCM's decision was that there has been no hearing on the merits of the dispute which brought the parties to the Local Court. That, alone however, is not a sufficient basis on which this appeal can succeed, notwithstanding the plaintiff's desire to have another opportunity to press its case against Mr Alderman. 24In the circumstances, it follows that this appeal, too, must be dismissed. Order 25For the reasons given, I order that the plaintiff's summons be dismissed. 26The usual order as to costs is that costs follow the event. In this case that would be an order that the plaintiff pay Mr Alderman's costs, as agreed or assessed. Unless the parties approach within 7 days to be heard, that will be the Court's order as to costs. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 09 October 2014