Gingis & Anor v National Australia Bank Limited M69/2000 [2001] HCATrans 653 (14 December 2001)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M69 of 2000

B e t w e e n -

ARKADY GINGIS and MASYA GINGIS

Applicants

and

NATIONAL AUSTRALIA BANK LIMITED

Respondent

Application for special leave to appeal

GUMMOW J

KIRBY J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 14 DECEMBER 2001, AT 3.04 PM

Copyright in the High Court of Australia

MR A. GINGIS appeared in person.

MR P.H. CLARK, SC: If the Court pleases, I appear with my learned friend, MR A.T. SCHLICHT, for the respondent. (instructed by Russell Kennedy)

GUMMOW J: Yes, Mr Gingis.

KIRBY J: Would you mind going to the central microphone? We have got a magnifying system.

MR GINGIS: Yes. Your Honour, I have got a written copy of my oral submissions which I will tender for your information.

GUMMOW J: Yes. This supplements what is already in the application book, does it? This is in addition to what we already have?

MR GINGIS: Well, there is nothing, in fact, in relation to my oral submission, now, right, so I just put it, right, also, for your convenience.

GUMMOW J: Yes. Have you a copy for the other side?

MR GINGIS: Yes.

GUMMOW J: Yes. We will take a minute to read this. If you would like to sit down while we read it.

MR GINGIS: Yes, your Honour. I still would like to say - - -

GUMMOW J: Yes.

MR GINGIS: I am still allowed to go through it?

GUMMOW J: Yes, but we will read it to ourselves, first.

MR GINGIS: Yes.

GUMMOW J: Yes, Mr Gingis, we have read this to ourselves.

MR GINGIS: Can I read it out?

GUMMOW J: Yes, certainly.

MR GINGIS: My contention, your Honours, is that their Honours Mr Justice Brooking and Mr Justice Batt in the Court of Appeal, by their conduct, displayed actual bias and further, or alternatively, gives rise to an apprehension of bias on their part.

KIRBY J: Now, only one judge had shares himself.

MR GINGIS: Justice Brooking did.

KIRBY J: And he, in fact, did reveal the fact that he had shares.

MR GINGIS: Well - - -

KIRBY J: I think it is said that he disclosed them to the representatives. You were then represented, were you not?

MR GINGIS: No. No, that is what - I was represented in the court but in fact prior to the court when I still was unrepresented, something like seven or eight days prior to the court hearing, I have received a phone call from the Justice Brooking associate advising me that would I object if I will find out that Justice Brooking does have a small shareholding at National Australia Bank. I did not question how small or how big. I just said, "All right, well let me think for a minute" and then I understand I rang back to the associate, myself, and advised him, "Look, if it is just a small holding, well, you know - - -

KIRBY J: Yes, but the fact is it was revealed to you.

MR GINGIS: It was revealed to me.

KIRBY J: If you had objected then a question would have arisen as to whether the judge should participate but unless you object or raise any hesitations or concerns - - -

MR GINGIS: I did not object.

KIRBY J: - - -you cannot really expect the judge to take it any further.

MR GINGIS: I am not suggesting that at all, your Honour. Actually, I put in my points here that that is not my main contention. If I will just continue reading it to tell what my main contentions are. In 99 per cent cases said in Ebner and Clenae a fair-minded lay observer would agree, if it is a small shareholding, you know, what is - what the hell, you know. It is not - - -

GUMMOW J: I depends on the way you are talking, a small shareholding in what?

MR GINGIS: That is right.

GUMMOW J: I mean, this is a bank with an enormous - billions, I suppose.

MR GINGIS: Yes, that is right. That is correct, but let me finish my reading.

GUMMOW J: Yes.

MR GINGIS: In the judgment of this honourable Court in the matters of Ebner v The Official Trustee in Bankruptcy and Clenae v ANZ Banking Group, to which I referred in my appeal submissions, their Honours said in regards to the question of disclosure of pecuniary interest by a presiding judge the following at paragraphs 67 and 72 of Ebner and Clenae which I provided you copies.

GUMMOW J: Yes, we have that.

MR GINGIS: If I could refer your Honours to have a look at paragraph 67 and 72, please? In my submission is that while there possibly no legal requirement that their Honours in the Court of Appeal should have disclosed their shareholding or their wife and daughters the fact that once his Honour Mr Justice Brooking had disclosed to me his personal shareholding, his failure to also disclose that far more valuable and substantial shareholding of his wife and daughter who, by the way, reside together with Justice Brooking.

GUMMOW J: Yes, there are many spouses - - -

MR GINGIS: Yes, sir.

GUMMOW J: - - -who do not know the property of their spouse or of their adult children.

MR GINGIS: Well, it is a possibility, but - - -

GUMMOW J: We have moved beyond the day when the father ran the show.

MR GINGIS: It is not so because the shares that have been hold by Justice Brooking's wife and his daughter, who reside with him at the same locality, in other words, are part of domicile, have been hold for a long, long time.

GUMMOW J: Yes.

MR GINGIS: And, I can assure you that, you know, half a million dollars of shareholding at the time that it was hold by the daughter for, at that time, something like 14 or 15 years is not a new shareholding that she just acquired the day before, but if I could just continue. What I am saying is that his failure to also disclose the far more valuable and substantial shareholding of his wife and daughter and the failure of Mr Justice Batt to disclosure a substantial shareholding of his wife and daughter gives rise to a reasonable apprehension of bias in the mind of a fair-minded lay observer.

In other words, I did not know, and I trusted Judge - Justice Robert Brooking that he had a small shareholding and I did not have any problem with that, but that, by itself, have to be added to the conduct during the court proceedings which I am putting in paragraph 3.

GUMMOW J: We have also got to look at this, too. This particular issue arose on a security of the costs application, did it not?

MR GINGIS: Correct. It was raised on the particular cost - security for costs application. Furthermore, had their Honours disclosed the shareholding of their family members then the actual share ownership of Mr Justice Brooking might very well have assumed fair greater importance than it did when the fact of the family's shareholding was unknown to me. In other words, what I am saying here that if I would know - not only Justice Robert Brooking had that small shareholding but also his wife and daughter had the much more substantial shareholding on top of the fact that Mr Justice Batt's wife and daughter had a substantial shareholding, you know, I would react maybe differently to his question.

KIRBY J: Yes, well, I understand that and you may know different judges have different views about what has to be disclosed. Some disclose everything, bore everybody about it, others disclose only what they feel they have to disclose because they regard it as their private business and this Court in Ebner has clarified the rules. It has laid down the rule and it has not indicated a universal rule that a judge must go as inquisitor to his wife or partner or daughters or sons or grandfather or uncles or anybody else and find what their shareholdings are. If I had shares I, myself, would disclose them. If my partner had shares I think I would probably know and I would disclose them.

MR GINGIS: Yes.

KIRBY J: But, not everybody knows what their spouse or partner has. Not everybody has a feeling that they should disclose it and the law is as stated in Ebner and it does not lay down, as arguably, the earlier case of Dimes did, a universal principle about this.

MR GINGIS: You are absolutely correct, therefore the subject of disclosure or non-disclosure of their wife's and daughter's shareholding, and particularly Justice Kirby reference "maybe he did not know about their shareholding" is basically could not happen because the shareholding of daughter of Justice Brooking have started on 8 June 1984 and that shareholding was of very, very substantial value and also that shareholding of good wife - - -

GUMMOW J: It was not of a substantial value in the scheme of things involving the National Bank, though.

MR GINGIS: Right, and perhaps I am not suggesting that that thing would somehow alter - the decision, would alter the value of the shares. I - you know, Ebner and Clenae have entirely clarified that matter. What I am saying is that in respect of that matter, not disclosing, and the conduct and the order which have forward up during that proceedings it was certainly, to me - I did not know about that shareholding at the time when I went to that hearing. When I did sit here and that bias when through that hearing then I said, "Well, why I was so unfairly treated?"

That is - I am not reading it. I am just explaining it to you - I am answering your questions. I said, "What actually could possibly move this honourable - the Court of Appeal to be so biased against me?"

GUMMOW J: Why would they be biased against you? Merely because they had some parcel of shares in an enormous entity like the National Bank.

MR GINGIS: No, no. Well, that is what I could not understand but if I could read further that why I felt the bias, and that is in combination with their conduct itself.

GUMMOW J: In terms of actual bias. Why would there be any actual bias?

MR GINGIS: Why it would be the actual bias, well - - -

GUMMOW J: It would be the last thing that would be on any judge's mind, I would imagine.

MR GINGIS: Are you asking me?

GUMMOW J: Yes.

MR GINGIS: Well, I felt that first of all when that hearing of Court of Appeal security for costs had started the applicants have not been even asked to present their matter. All right. In other words - - -

KIRBY J: But that is not uncommon where - - -

MR GINGIS: It is not uncommon.

KIRBY J: - - -judges are dealing with urgent - lots of interlocutory matters and call on the party we want to hear from.

MR GINGIS: I understand. I understand. So, that has happened.

GUMMOW J: It happened here this morning.

KIRBY J: We like to do that. It keeps everybody on their toes.

MR GINGIS: That is right. If you can spend the time, of course, but what happened at the hearing that first of all my affidavit material that I have presented in veracity, and I am happy to read it further down, was unreasonably questioned and in particularly that the question of truthfulness and, you know, veracity of affidavit material that I presented.

KIRBY J: But let us analyse it. You think that a reasonable observer would think they were biased.

MR GINGIS: Yes.

KIRBY J: But a reasonable observer sitting in the back of the Court would say, "The judge has had a shareholding. He revealed that. The judge's family has had a shareholding. He did not reveal that but maybe he did not know about it. However, they live together. Perhaps he did know about it, but in any case, would that shareholding have in any way influenced the judge in reaching the judge's conclusion?" Answer, "No, because in comparison to the bank, the shareholding is very small and cannot be affected by the decision in the case".

MR GINGIS: You are absolutely right. I am not suggesting, and I am again repeating myself, that this shareholding, by itself - the decision of the court at the time would not alter the value of the shares. As it was accepted and accepted by myself and it was stated in Ebner and Clenae, that is not an issue. The issue is the conduct, together with that hidden or non-disclosed shareholding. Now, if I may just continue because that is my thoughts. So, furthermore, had their Honour disclosed the shareholding of their family members then the actual share ownership of Mr Justice Brooking might very well have assumed far greater importance than it did when the fact of the family's shareholding was unknown to me

I referred to the word of their Honours at paragraph 70 in the judgment of this honourable Court, Ebner and Clenae:

A failure to disclose is relevant only because it may be said to cast some evidentiary light on the ultimate question of reasonable apprehension of bias.

It is paragraph 70. I repeat:

A failure to disclose -

it is the second line -

A failure to disclose is relevant only because it may be said to cast some evidentiary light on the ultimate question of reasonable apprehension of bias.

I submit that your Honours should have regard to that failure and should find that the failure gives rise, particularly when considered together with other conduct of their Honours in the Court of Appeal, to a reasonable apprehension of bias. That is my respectful submission. In paragraph 4 I am saying that at paragraph 96 of this honourable Court judgment in Ebner and Clenae their Honours said, also:

it is not necessary to determine the issue in these appeals, it is my view that the fair-minded lay observer would not conclude that a judge might not bring an impartial mind to bear on proceedings simply because his or her partner or spouse owns shares or has some other financial interest in a public company which is a party to proceedings or has an interest in their outcome.

GUMMOW J: Now, Mr Gingis, I notice that of course there are two applicants here. The second applicant is your wife, I take it?

MR GINGIS: My wife, correct.

GUMMOW J: You are seeking leave to present these submissions on her behalf, as well?

MR GINGIS: Correct. I am sorry I did not mention that. I am not familiar with the Court.

GUMMOW J: Yes. This has been discussed with her?

MR GINGIS: Yes, absolutely.

GUMMOW J: Yes, thank you. Yes, go on.

MR GINGIS: Further on in Ebner and Clenae it states in that paragraph 96:

At least that is so if the shareholding or other interest is not substantial. And if it is not substantial, there is no reason why his or her shareholding should be disclosed.

With respect, I submit, your Honours, that the shareholding of his Honour Mr Justice Brooking and his Honour's wife and daughter and the shareholding of his Honour Mr Justice Batt's wife and daughter were substantial and should have been disclosed by their Honours.

Now, I have done special calculations on page 44 of the application book - if I could refer you to that page - that at the time of the hearing the value - the total amount involved in the total shareholding of all these five persons was somewhere close to three-quarters of a million dollars; to be precise, $740,938. So, I respectfully submit that this is a very substantial shareholding. More to that, these days, this shareholding is close to a million dollars worth.

I further submit that when the matter of their Honours' non-disclosure is considered together with the conduct of Mr Justice Brooking when he, at least implicitly - that is - I am talking about the affidavit, his question about the affidavit - queried the veracity of what was said in the affidavit of Mr Roy De Carvalho, and, perhaps more importantly how I felt bias, the bank is very experienced in what they are asking for security for costs. That is what I said in my application to this Court. Justice Brooking had the liberty to suggest, himself, to the bank, to ask for more money than they ask.

In other words, he, himself, you know, said, the banks has asked something like $13,000 and Justice Brooking comes along with the words, "Well, it would not be better, you know, to that degree, ask for $15,000?" The bank did not ask that. Now, in other words, he asked to increase the amount of security for costs without the National Australia Bank or its counsel having applied for such an increase. More importantly - more importantly, the bank also did not attack, prior to that hearing, the veracity of the affidavit of Mr Roy De Carvalho. Justice Brooking have attacked it himself.

In other words, he displayed - he questioned us. The bank did not say anything, did not question Carvalho's affidavit on - or he have to - Justice Brooking have took initiative and ask, you know, for the proof, which we have done. Then their Honours in the Court of Appeal showed and show bias. In other words, what I am saying is, I further submit that when the matter of their Honours' non-disclosure is considered together with the conduct of Mr Justice Brooking when he, at least implicitly, queried the veracity of what was said in the affidavit of Mr Roy De Carvalho without the bank being involved or without the bank attacking that veracity, perhaps more importantly, increases the amount of security for costs without the National Australia Bank or its counsel having applied for such an increase.

In other words, somebody comes along and saying, "Look, I wanted $13,000 out of this man" and the judge says, "Oh, look, you know, I think you need more".

KIRBY J: I understand your reaction to that.

MR GINGIS: Okay, yes.

KIRBY J: But, having sat in the practice list in Sydney and the Court of Appeal you round things up.

MR GINGIS: I am sure, yes. I felt very - bias against me.

KIRBY J: You know roughly what is the standard. That is all that the judges did.

MR GINGIS: Yes, that is right. Then their Honours in the Court of Appeal, I submit, showed actual bias and, further, their conduct given risen to an apprehension of bias. A further matter that is of considerable importance, when considered together with their Honours' conduct and non-disclosure, is the order that was made by their Honours, that is, that the appeal be dismissed if the security was not provided within one month. An order of that nature is extremely rare. What was sought by the application for security was an order that the defendants provide security for the costs of the appeal to the prothonotary in a form satisfactory to the prothonotary.

If you could please refer yourselves to the summons on page 22 of the application book. That is what was said in that summons. In other words, the National Australia Bank, not their counsellor, requested the dismissal of my appeal. No request was made by the National Australia Bank or by its counsel for the dismissal of the appeal in the event of security not being provided. Moreover, I gave you copies of rule - on the front page of your - rule 64.17(2). If you would please refer yourself to that rule - of the Rules of Procedure in Victoria provide, "The Court of Appeal may, in special circumstances, make an order that security be given for the costs of an appeal". It does not provide for dismissal of the appeal. In other words, the rules are very, very clear what - - -

KIRBY J: No, but that is just generic. It gives the order for security of costs. It does not provide one way or the other as to what consequences will flow from it breach.

MR GINGIS: I am not exactly - - -

KIRBY J: I agree with you that generally speaking it is undesirable to make self-executing orders but it is not invalid.

MR GINGIS: Well, he could say that the matter could be stayed - I am sorry.

KIRBY J: It is undesirable but it is not invalid.

MR GINGIS: I am not saying it is not invalid but he could say, "Look, the matter could not proceed to the appeal until - - -

KIRBY J: I see your time is up. In essence you - - -

MR GINGIS: Just one more - one more - - -

GUMMOW J: Yes, just one more.

MR GINGIS: One more.

GUMMOW J: Yes.

MR GINGIS: I refer to your Honours to that fact that in an appeal to the High Court an appellant will not be ordered to provide security for costs - in your own Court - on the grounds only of impecuniosity. Clearly, the discretion of their Honours in the Court of Appeal had to be exercised with strict consideration for my entitlements to appeal and I say that on the facts presented by me to their Honours that discretion was incorrectly exercised. I say that the affidavit material presented to the Court of Appeal and which was not attacked by the National Australia Bank - remember they did not question the veracity of this affidavit - did not entitle their Honours to find that I was impecunious. I further say that the valid grounds of appeal existed which I should have been permitted to argue before the Court of Appeal.

Finally, your Honours, while the amount ordered to be provided as security was $15,000, plus costs, the amount at issue on appeal was in excess of $171,000. So, I was deprived from my ability - - -

GUMMOW J: Yes, we have read that.

MR GINGIS: Moreover, I went twice - - -

KIRBY J: We know all that. That is all in your - - -

MR GINGIS: I went twice to the Court of Appeal - - -

KIRBY J: Yes.

MR GINGIS: - - -explaining to them - you see, what I have done - - -

GUMMOW J: No, Mr Gingis, we have reached the end, I think.

MR GINGIS: One last point - sentence.

KIRBY J: One sentence.

MR GINGIS: One word. One word.

KIRBY J: One sentence only.

MR GINGIS: Last word. I normally trust people. Normally, when the judge says he has got a small shareholding he has got a small shareholding. When I could see that terrible bias against me I went - and only then I went to the National Australia Bank registry and then I have discovered that non-disclosed - - -

KIRBY J: Yes, we know how - - -

MR GINGIS: So, I went twice to the Court of Appeal telling them that, asking actually to stay that previous order. In other words I could organise myself - or at least to delay that 30 days. They did not want to hear. Thank you.

GUMMOW J: Yes, Mr Gingis. We do not need to call on you, Mr Clark.

The Court has heard submissions by the first applicant on behalf of himself and his wife, who is the second applicant. The first applicant has the necessary leave of the Court to appear for the second applicant.

With respect to the special leave matter itself, our conclusions are as follows. In the Court of Appeal of Victoria only one judge is alleged to have held shares on his own behalf in the respondent Bank. The judge disclosed the shareholding. Neither he nor the other judge disclosed the shareholding in the Bank of their family members. It is not at all certain that their Honours knew of those shareholdings in order to declare them.

The governing principles in this area are stated in the recent decision of this Court in the matter of Ebner [2000] HCA 63; (2000) 176 ALR 644. There is no reason to warrant the Court reconsidering or restating those principles. The Court notes that in any event the issue arose here on an application for costs, not on a substantive hearing. Accordingly, special leave is refused and it should be refused with costs.

Call the 11th application.

MR GINGIS: But I was not given opportunity to go to Court of Appeal. They did not let me.....

GUMMOW J: Just sit down, please, Mr Gingis. Sit down, please, Mr Gingis. Call the 11th matter.

AT 3.34 PM THE MATTER WAS CONCLUDED