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Liprini v Liprini & Anor [2011] FMCA 1029 (22 December 2011)
Last Updated: 6 January 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
BANKRUPTCY – Application for annulment of
bankruptcy – interim application on issue of vexatious litigant orders.
PRACTICE AND PROCEDURE – An interim application by the respondent
that the proceedings should be stayed as a result of the orders
made in the
Supreme Court of NSW declaring the applicant a vexatious litigant – orders
not binding on this Court.
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Delivered on:
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22 December 2011
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REPRESENTATION
Solicitors for the Respondents: |
Mr Farrer of Farrer Lawyers
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ORDERS
(1) The oral application made on 6 December 2011,
seeking that these proceedings be stayed as a result of the orders made in the
Supreme
Court of New South Wales declaring Dr. Liprini to be a vexatious
litigant, is dismissed.
(2) Costs reserved.
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FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT
SYDNEY
|
SYG 2522 of
2011
Applicant
And
First Respondent
Second Respondent
REASONS FOR JUDGMENT
Introduction
- The
applicant, Dr Allan Stephen Liprini, was made bankrupt by way of a sequestration
order made against him on 3 September 2010 in
Federal Magistrates Court. On 7
November 2011, Dr Liprini filed an application to this Court, seeking in the
following terms:
- A. FINAL
ORDERS SOUGHT BY APPLICANT
- On the
grounds stated in the supporting affidavit or statement of claim, the applicant
seeks the following orders (Specify in numbered
paragraphs all the final orders
sought.):
- 1. ...Annulment
of Bankruptcy No 7117/10/09 as a result of the sequestration order written by
Federal Magistrate Smith on 3rd September 2010 in the
Federal Magistrates Court in Sydney. Under Rule [82,310.15] of the Bankruptcy
Act 1966.
- 2. Reversal
of all costs orders made in association with all related Bankruptcy
matters.*
- 3. Recommendation
for investigation/prosecution by DPP.
- *may
require specific bankruptcy jurisdiction otherwise all related FCA and FMC
matters/proceedings.
- B. INTERIM
ORDERS SOUGHT BY APPLICANTS
- (Complete
this section if you also seek interim orders)
- 1. Stay of
all activities either under way or contemplated by the respondents, other
parties of their representatives, from the date
of this filing until resulting
orders entered.
- 2. Leave
(i) to amend grounds and legislation involved.
- (ii) in
addition (2) if any legal advice is offered or becomes available
- (iii) to
file further evidence (affidavit, exhibit or other material) that was not
available or completed at time of filing.
- On
11 November 2011 Farrar Lawyers, acting for the Trustee, the second respondent
to the application, filed an interim application
seeking:
- 1. An order
that the respondent’s application for annulment filed 7 November 2011 be
summarily dismissed.
- 2. An order
that the respondent pay the applicant’s costs of the
proceedings.
- The
matter was made returnable before a Registrar of the Court for a first court
date on 6 December 2011, where it was then referred
to me. On that day, Mr
Farrar, appearing for the Trustee, made an oral application that the application
for annulment of the applicant’s
bankruptcy should be stayed pursuant to
an order made in the NSW Supreme Court by Adamson J on 5 December 2011. It is
this issue
that is the subject of this interim judgment.
Litigation history
- On
3 September 2010, Scott Darren Pascoe was appointed as the Trustee in Bankruptcy
for the property of the bankrupt estate of Dr
Allan Stephen Liprini. The
Sequestration Order was made by his Honour Smith FM in Liprini v Liprini
[2010] FMCA 687. Dr Liprini subsequently filed 2 sets of proceedings being:
NSD 1237/2010 and NSD 1238/2010. On 8 October 2010 her Honour Jagot
J
considered the Notice of Appeal and Notice of Motion Application for a Stay of
his Honour Smith FM Orders and refused the stay:
Liprini v Liprini [2010]
FCA 1117. On 19 November 2010 the proceedings NSD1237/2010 and NSD1238/2010
were heard by his Honour Emmett J where his Honour ordered the
appeal be
dismissed with costs: Liprini v Liprini (No.2) [2010] FCA
1495.
- On
16 December 2010, Dr Liprini commenced Federal Magistrate Court proceedings
SYG66/2010 seeking various injunctive remedies against
parties including Mr
Pascoe. On 22 December 2010 his Honour Raphael FM dismissed Dr Liprini’s
application and ordered Dr Liprini
to pay the applicant’s costs.
- On
1 April 2011 Dr Liprini filed an application seeking an annulment of his
bankruptcy and an interim stay of the bankruptcy pending
determination of the
application for annulment. No interim stay was granted and on 17 May 2011, his
Honour Driver FM dismissed the
application for an annulment: Liprini v
Liprini & Anor [2011] FMCA 359. On 7 June 2011, Dr Liprini filed a
Notice of Motion seeking a stay of the orders of his Honour Driver FM in the
Federal Court proceedings
NSD735/2011. On 22 June 2011 his Honour Jacobson J
dismissed the Notice of Motion with Costs: Liprini v Liprini [2011] FCA
722. Also on 7 June 2011, Dr Liprini filed a Notice of Appeal in the Federal
Court proceedings NSD735/2011.
- On
16 September 2011, Dr Liprini also filed an interlocutory application in the
Federal Court proceedings NSD 735/2011 seeking a further
stay. On 7 October
2011 his Honour Yates J dismissed the Application: Liprini v Liprini (No.2)
[2011] FCA 1150. On 7 November 2011 his Honour Yates J dismissed the appeal
and ordered Dr. Liprini to pay Mr Pascoe’s costs.
- On
7 November 2011, Dr Liprini filed an application in the Federal Magistrates
Court (SYG2522/2011) with an affidavit affirmed on
the same date which initiated
the current proceedings in this Court. In an affidavit of David Matthew Farrer
representing Mr Pascoe,
sworn and filed on 11 November 2011, attests that Dr
Liprini has had a Sequestration Order made against him, unsuccessfully appealed
against the Sequestration Order in the Federal Court of Australia, has sought
interim stays pending the hearing of the appeal which
were refused.
Dr
Liprini has appealed to the Federal Court in proceedings NSD735/2011 against the
refusal of his Honour Driver FM to annul Dr Liprini’s
bankruptcy in the
Federal Magistrates Court, has had multiple interim applications refused and the
ultimate Notice of Appeal dismissed.
Mr Kemp indicates that the primary basis
for Dr Liprini’s application appears to be the existence of
‘fresh’ evidence
however that evidence is not contained in an
affidavit supporting the application.
Supreme Court of New South Wales proceedings
- In
addition to the proceedings in the Federal Court and the Federal Magistrates
Court, there are a number of matters being run concurrently
in the Supreme Court
of New South Wales. As a consequence of these proceedings, Mr Pascoe sought
orders (vexatious proceedings orders)
by summons filed on 20 June 2011 under s.8
of the Vexatious Proceedings Act 2008 (NSW) prohibiting Dr. Liprini from
instituting proceedings in New South Wales without leave of an appropriate Court
under the Act;
and staying all proceedings already instituted in New South Wales
by Dr. Liprini. This matter was heard by her Honour Adamson J
and her Honour in
her judgment noted that Mr Pascoe was Dr. Liprini’s trustee in bankruptcy,
having been appointed by order
of his Honour Smith FM in the Federal Magistrates
Court on 3 September 2010. In support of his substantive application, Mr Pascoe
relied on his affidavit sworn 29 June 2011 and 8 July 2011, the affidavit of Mr
Farrer, Mr Pascoe’s solicitor, sworn 4 August
2011 and the affidavits of
Mr Kevin Liprini, Dr. Liprini’s brother, sworn on 16 September 2011.
After considering the general
principles in respect of vexatious proceedings,
together with the evidence before the Court, her Honour made the following
orders:
- 1.
Pursuant to s.8(7)(b) of the Vexatious Proceedings Act 2008, the defendant [Dr.
Liprini] is prohibited from instituting proceedings in New South Wales without
leave of the Court.
- 2.
Pursuant to s.8(7)(a) of the Vexatious Proceedings Act 2008, all of the
proceedings in New South Wales already instituted by the defendant [Dr. Liprini]
be stayed.
- 3. The
defendant [Dr. Liprini] to pay the plaintiff’s [Mr Pascoe] costs.
Effect of the vexatious litigant orders
- In
Nicholas Kirby’s article “Where rights cause injustice: A critique
of the Vexatious Proceedings Act 2008 (NSW)”, (2009) Sydney Law
Review Vol.31 at 163, the author states that for over 25 years persons
declared by the Supreme Court of New South Wales to be considered
‘vexatious litigants’ have been prevented from instituting any legal
proceedings in New South Wales Court without leave:
Supreme Court Act
1970 (NSW), s.84 repealed by the Vexatious Proceedings Act 2008
(NSW). The author also indicates that an order made under s.84 could only
restrain a vexatious litigant from instituting proceedings
in any Court within
New South Wales jurisdiction: Attorney-General (NSW) v Betts [2004] NSWSC
901 at [3]. This left both of the Federal Courts and the administrative
tribunal system open for persons found to be vexatious litigants to
pursue their
claims, despite being excluded from New South Wales courts. This is subject to
the relevant Court’s own rules,
see Federal Court Rules (Cth)
r.6.02 (formerly O.21, r.2); High Court Rules 2004 (Cth) r.6.06.1.
Presently, the Administrative Decisions Tribunal (ADT), is restricted to
utilising its power under the Administrative Decisions Tribunal Act 1997
(NSW) s.88 to award costs against litigants’ in special circumstances:
Alessa Pty Ltd v Total and Universal Pty Ltd [2001] NSWADT 150 at [5].
- The
meaning of special circumstances has been considered in a number of decisions of
this Tribunal. Descriptions of such circumstances
range from circumstances
which take the matter out of the ordinary course to circumstances where the
claims lack any conceivable
merit, in fact or law, purposes for a cost order in
those circumstances being described as a measure to prevent “a gross abuse
of litigation by frivolous and vexatious and misconceived proceedings”.
The author indicates that vexatious litigation within
the Federal jurisdiction
is clearly the sole responsibility of the Federal arms of the Government. The
implementation of a national
consistent approach to vexatious litigants,
however, could more effectively prevent “forum shopping” and
collateral litigation.
It is noted by the author that this appears to have been
one of the objectives of the Standing Committee of the Attorney General’s
in drafting the model bill which is the basis of the Act (Explanatory Memorandum
accompanying the Vexatious Proceedings Bill 2008 (NSW) at 2.).
- The
Federal Magistrates Court has its own provisions for vexatious litigants.
Relevantly, in the Federal Magistrates Court Rules 2001 (Cth), r.13.11
addresses vexatious litigants in the following terms:
- Vexatious
litigants
-
(1) If the Court is satisfied that a person has instituted a
vexatious proceeding and
the Court is satisfied that the
person has habitually, persistently and without
reasonable grounds instituted other vexatious proceedings in
the Court or any other
Australian court (whether against the same person or
against different persons), the Court may order:
-
(a) that any proceeding instituted
by the person may not be continued without leave of the Court; and
-
(b) that the person may not institute a proceeding without
leave of the Court.
-
(2) An order under subrule (1) may be made:
- (a)
on the application of a person against whom the person mentioned in subrule (1)
has instituted or conducted vexatious
proceedings;
or
- (b)
on the application of a person who has sufficient interest in the matter;
or
-
(c) on the Court's own motion; or
-
(d) on the application of the Attorney-General of the
Commonwealth or of a State or Territory; or
-
(e) on the application of the Registrar.
-
(3) If a person (a vexatious litigant) habitually and persistently
and without reasonable grounds institutes vexatious
proceedings in
the Court against another person (the person aggrieved), the Court may, on
application of the person aggrieved, order:
-
(a) that any proceeding instituted
by the vexatious litigant against the person aggrieved may not be continued
without the leave of the Court; and
-
(b) that the vexatious litigant may not institute any proceeding against
the person aggrieved without leave of
the Court.
-
(4) A person seeking an order under this rule must file an
application.
-
(5) The Court may rescind or vary any order made under this
rule.
-
(6) The Court must not give a person against whom an order is made
under this rule leave to institute or continue any
proceeding unless
the Court is satisfied that the proceeding is
not an abuse of process and that there is prima facie ground for
the proceeding.
-
(7) Unless the Court orders otherwise, an application by a person
who is subject to an order under subrule (1) or (3)
may be determined by the
Court without an oral hearing.
- Consequently,
I have formed the view that the decision of her Honour Adamson J has no effect
in this Court. Mr Kent was unable to
refer to any authority to the Contrary.
Further, there is no application currently before this Court in respect to an
order that
Dr. Liprini is a vexatious litigant.
- In
the absence of any formal application to declare Dr. Liprini a vexatious
litigant in this Court, I have formed the view that the
orders of her Honour
Adamson J have not effect in this court and that the hearing of the application
filed by Dr Liprini being SYG2522
of 2001 should proceed and an appropriate
timetable be set for hearing. Any new evidence relied upon by the parties should
be filed
with an appropriate affidavit prior to that scheduled hearing.
I certify that the preceding
14Error! Style not defined.!Syntax Error,
!Error! Style not defined.Error! Style not defined.!Syntax Error,
!fourteenfourteen (14) paragraphs are a true copy of the reasons for judgment
of Lloyd-Jones FM
Date: 22 December 2011
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