Deckana Pty Ltd as Trustee v The Northern Territory of Australia D10/2000 [2002] HCATrans 217 (3 May 2002)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Darwin No D10 of 2000

B e t w e e n -

DECKANA PTY LTD AS TRUSTEE

Applicant

and

THE NORTHERN TERRITORY OF AUSTRALIA

Respondent

Application for special leave to appeal

KIRBY J

CALLINAN J

TRANSCRIPT OF PROCEEDINGS

FROM DARWIN BY VIDEO LINK TO CANBERRA

ON FRIDAY, 3 MAY 2002, AT 2.26 PM

Copyright in the High Court of Australia

MR M.P. GRANT: If it please your Honours, I appear with my learned friend, MR P.J. TIMNEY. for the respondent. (instructed by the Solicitor for the Northern Territory)

KIRBY J: Mr MacFarlane, you are there in Darwin, I think, is that correct?

MR A.S. MacFARLANE: Yes, your Honour.

KIRBY J: You are seeking leave to appear for the applicant company, Deckana Pty Ltd, is that correct?

MR MacFARLANE: It is only a trustee company, your Honour.

KIRBY J: Yes, but it is a corporation, is it? Normally, corporations only appear by legal representatives.

MR MacFARLANE: This could be a little bit different. The land is actually owned by the family trust and the trustee company is only holding the land in trust, like the family trust is the only one that lodges a tax return and the trustee company - - -

KIRBY J: Yes, but it is still a company, you see. Now, do you tell the Court that you have the authority of the company to seek leave to appear for it in this application? Does the company give you authority?

MR MacFARLANE: Yes.

KIRBY J: Because otherwise the company, so far as the law is concerned, is a different person to yourself, you see. Now, do you have the authority to make the application to this Court for the company?

MR MacFARLANE: I have, yes, from the family trust.

KIRBY J: Yes. Do you have any objection to Mr MacFarlane being given leave to appear for Deckana Pty Ltd, Mr Grant?

MR GRANT: If it please your Honours, we are not aware of the basis upon which he has authority. We are not aware of the internal management structure of the company and it is really a matter as between Mr MacFarlane and the company and the company and the Court. So we have no objection, your Honour.

KIRBY J: In the New South Wales Court of Appeal, where I struck this problem quite often, the view of the court was that private individuals should not appear for companies, generally. Now, I do not know - this does not seem to have caused any delay in the courts of the Northern Territory. Is there some rule of the courts of the Northern Territory that permits a private individual to appear for companies with leave of the court or - - -

MR GRANT: Your Honour, Order 1 rule 14 of the Supreme Court Rules provides that in the general run a corporation can only be represented by a legal practitioner.

KIRBY J: But Mr MacFarlane was given leave to appear both before the primary judge and also in the Court of Appeal, was he not?

MR GRANT: Your Honour, some distinction is drawn between taking a step in a proceeding and appearing to present argument on behalf of the company. The appeal itself was lodged by the company when it was represented by solicitors. Such leave, as was given formally, was, as I understand it, to enable Mr MacFarlane to present argument on behalf of the company. Whatever leave was granted, however, your Honour, was withdrawn by the court in April 1999, so that is the position that appertains still in respect of the Northern Territory proceedings.

KIRBY J: You are here today and Mr MacFarlane is there in Darwin and he says he has the authority of the company to appear for it in this application, which is, after all, only an interlocutory application and is not the hearing of the appeal. If he were to receive special leave, the question might well be different on the return of the appeal. Do you have any objection to Mr MacFarlane's appearing now for the company?

MR GRANT: No, your Honour, we have no objection to that.

KIRBY J: Yes, very well. Mr MacFarlane, there is a mention in the book at page 41 where you say that you are bankrupt. Now, was that just saying that you are short of money or have you been made bankrupt by an order of the court, or not - you, personally?

MR MacFARLANE: Not really, but just the way the - - -

KIRBY J: Just answer the question. It may save time if you just say whether you have been made bankrupt by an order of the court or not.

MR MacFARLANE: No, not by an order of the court, but by the acquisition - - -

KIRBY J: All right. Stop there.

MR MacFARLANE: - - - by the acquisition you could say that I have been.

KIRBY J: I am sorry?

MR MacFARLANE: Because the - I am sorry?

KIRBY J: What about the company, Deckana Pty Ltd? Is that company in liquidation or not?

MR MacFARLANE: Well, as far as I am concerned, I want to get rid of the company. It is only a trustee company. It is the same people - - -

KIRBY J: But is not formally in liquidation by order of a court?

MR MacFARLANE: No.

KIRBY J: No. Very well. So the company is not in liquidation and you are not bankrupt by order of the court and you are asking our leave to appear. Perhaps the best course we will adopt is to - - -

MR MacFARLANE: Well, I thought the compulsory acquisition demanded my appearance.

KIRBY J: Yes, we know about that. We have read the papers. The best course we can adopt is simply to allow you to present what you have to say, without formally granting you leave to appear. We will listen to what you have to say. If you are granted special leave to appeal, then you would not have any leniency on the return before a Full Court. You would have to be legally represented. If you do not get a grant of special leave to appeal, then no great harm has been done because you are there and Mr Grant and Mr Timney are here. So you press on. Your time will start from now. We will listen to you. This is not a precedent, but we will listen to what you have to say and then we will decide whether or not you have a case, at which event you will have some problems appearing for yourself on your own for a company, because as far as the law is concerned you are different people.

MR MacFARLANE: I see. Firstly, I have been affected by - I have got a pastoral lease. It is owned by the family trust. The family trust involves me and my wife. Now, I did not set this company up. Apparently, there is a law in the Northern Territory that says that family trusts cannot own land.

CALLINAN J: Look, you have been told you can address us on what you want to address us on.

MR MacFARLANE: Thank you. I am just - - -

CALLINAN J: No, we do not want to hear that now. Just tell us why you should have special leave.

MR MacFARLANE: I thought we were talking about the - special leave for what?

CALLINAN J: To appeal to the - - -

MR MacFARLANE: For this costs thing?

CALLINAN J: No, special leave to appeal to this Court. Why should you be allowed to present an appeal to this Court?

MR MacFARLANE: For costs. Well, with the acquisition, firstly - right, I had better - it is a pastoral lease and the thing the Court I think has got to work out - like the Pastoral Land Act. The Pastoral Land Act says we surrender our lease for subdivision because the rail line is going to go through the property. It is a separate lease. It is a separate lease to my lease and it subdivides my lease. The Pastoral Land Act law says that we surrender our lease for a subdivision at no cost to the public.

If that lease wants to go through the middle of my lease, which gives me two pastoral leases, there is no compulsory acquisition. There is no compensation. All I need is the two pastoral leases. These fellows did not give me subdivision. They compulsorily acquired the corridor which subdivides the property anyway. Now, they are saying, "You have got to go and get your own - you fund the costs of getting the compensation."

Now, that brings me to the main point. If the government or the compulsory acquirer knows that he does not have to pay my costs, he firstly can offer me - and he knows in the Territory that I have got to go to the Land Tribunal. I have got to go to pre-acquisition hearings. I have got to go to the Supreme Court and to the Appeal Court and then get to the High Court. He knows I have got that much cost before I can get to anyone to - well, he knows I have got that much cost before I can get really justice. He can muck me around for that much longer. So, he knows that he can offer me that much. That whatever that cost is out of those five hearings, less my value of my land than what he should offer.

If he knew he had to pay that cost, he would offer me the right money straightaway so that he would not involve me in all this other nonsense. It is because he knows he does not have to pay that cost that they are not offering anyone the right compensation, otherwise they would have given me subdivision back in 1994.

That is the guts of it, really, and, especially that this pastoral lease has been mortgaged - this brings another problem. The mortgagee has only got the company Deckana that is holding the land in trust. He has not got - you know, the lease entails - as you can see on this 135, the lease entails having 1,300 head of cattle and boundary fences and putting a homestead and all that. It is the mortgagee is not - the mortgagee has not lent any money towards the cattle, but he can, you know - if I do not get my costs here, I am going to go broke. He can sell my place and take the cattle, which he has never lent any money on, by this devaluation of this rail corridor.

To give you an idea of what that devaluation is, at the time of the acquisition I got the property valued, just the land, which is what Deckana - apparently Deckana owns the land and the family trust owns the rest of the assets, the homestead and the cattle. This is where the difficulty is going to be with this trustee bit. The valuation of the land was 700,000 done by a valuer here from Darwin and the devaluation was done by a valuer from South Australia, that it devalued that 700,000 by 1.9. What sort of position does that leave me in with my bank? He knows the value. There is no value there. It has gone.

And, on top of that, we get on this page 134 that I have given you here, we have got a court order restraining me from selling or transferring my asset because they want to acquire a piece of land. So, any - I cannot remortgage. I have got this on my bloody title that I have got restraining me "from selling, transferring or disposing" of my interests in the land. Is that because, you know, they have taken the land off the wrong person, the trustee instead of the family trust? And if that is the case - if that is the case, that is probably the reason they are not giving me any security for my costs because Deckana, as far as I am concerned, does not own anything. The family trust owns the assets.

If they take it off the family trust and refers the family trust to the court - I mean, they are referring all of my assets to the court to be held as security for their costs which they know they can run up in the Tribunal, the Supreme Court and the bloody Appeal Court here and take it out of my assets. At the same time, they are giving me no security for any of my costs of, you know - I have been tied up since 1994, as I have said, with this subdivision thing, and I have got my own time - they say, "Oh, you know, because I am a company director" or whatever, which I say is nonsense, anyway. I can, you know - if they get this - this nonsense here off my title saying that I cannot dispose or transfer my assets, I will get rid of the company Deckana - the same people that in the family trust become the trustee. I have actually done that in the Northern Territory for $5. They say that it is invalid.

KIRBY J: But, Mr MacFarlane - - -

MR MacFARLANE: I think there is a bit of a problem with just taking this land off the trustee, which is the only reason I can see why they would want to - - -

KIRBY J: Yes. You see, this is the problem when you appear without having legal advice. I know you say that you do not have the money to get it but - - -

MR MacFARLANE: Well, that is exactly what compulsory acquisition is, though.

KIRBY J: But the fact of the matter is that you have been told, first by Justice Thomas and then by the Court of Appeal, that you have an appeal which you have instituted to the Supreme Court from the decision of the Tribunal and that is the place at which you can raise your arguments concerning interest and cost. Your appeal has not been heard yet before the Supreme Court and that is the place where you can raise these matters. The respondent here today acknowledges that that is the place where you can raise the matters and - - -

MR MacFARLANE: What, back at the Tribunal? Back at the Tribunal?

KIRBY J: Before the Supreme Court. You have an appeal before the Supreme Court and instead of doing that, you are seeking to argue these interlocutory matters instead of arguing these points, as you would if you were properly legally advised, on the return of your appeal to the Supreme Court of the appeal from the Tribunal.

MR MacFARLANE: Well, that is what we went to. The first thing we went to was the Supreme Court. In the Supreme Court Rules - I will just have a look. I do not know this. In the Supreme Court Rules - and it would be referring to compulsory acquisition - page 298 of the Supreme Court Rules:

SECURITY FOR COSTS

83.11 it is:

If a tribunal, a decision of which is subject of an appeal, has power to award costs in respect of proceedings before it, the Court may, in special circumstances, order that such security as it thinks fit be given for the costs of the appeal.

Would not that give the court the power - you do not want your costs after because you have got no money to run your appeal. You have got to have your costs before you go to this thing - be equal to the government if it is going to be on just terms, because they have referred all my assets to the court. I have been pulled into court, here, by the referral of the Minister. I did not want to come to court. I am not going to accept the idiot offers he has given me, either. I have been told to come to court here and refer all my assets as security for the government's cost. They have got the piece of land. They want to lease it to the railway. They have built the rail line on and they are telling me I go back to the Tribunal and ask them to get costs at the end of the hearing.

The precedence has been set in this in this with this cost thing, first, by Mr Albany here back in 1976, Albany v Commonwealth, and they tried to do the same thing. We have got to have our costs up front otherwise we get blackmailed from day one. They are offering me no security for my costs. They have cut all my assets off as security for their costs. They must surely give me the value of my assets so that I can do something. And saying now that I am a company and cannot represent myself, well, how do I pay a lawyer? What I have said to these judges who have said, "Get a lawyer", "Well, you appoint him and you pay him and take responsibility for any mistake he makes."

KIRBY J: Well, is that the essence of what you want to put before the Court because I have a few questions for your opponent. Is there anything else that you want to say in support of your application?

MR MacFARLANE: Well, it is a pastoral lease. We should not have compulsory acquisitions, subdivision, they are banned. Surrender lease for subdivision. Section 62 of the Pastoral Land Act - 61, is it? Is that relevant to you a little bit or you are not interested in that? "SURRENDER A LEASE FOR SUBDIVISION", section 61 of the Pastoral Land Act. I thought that they would not need to compulsory acquire this given subdivision.

The other thing is with this cost thing, they have already - they have offered 300,000 but I had to sign an indemnity indemnifying me from all this stuff. Maybe we can get an order for the other 140,000 of that, seeing they have already admitted that, you know, the debt is $300,000. We can get an order they pay the other 140,000 of that today, because, you know, next time I come to Darwin I have got a bit of money that I am using of theirs because I have been referred to the court by the government.

KIRBY J: Yes.

MR MacFARLANE: Because they know they do not have to pay my costs, they play around with me. They will do the same to everyone in the future. They have done it to everyone. They know they do not have to pay your costs. They do not offer you the right money. They start blackmailing you, especially when you have got a mortgagee involved too. The mortgagee closes, surrenders your title. The mortgagee who closed is supposed to give my title to the next mortgagee. Instead of that, the government gets it in the middle, puts the rail line on it and then gives it to the next bank, and you get left with argument. If you do not get your costs, you are going to get blackmailed.

KIRBY J: Yes, very well. Well, I think we understand what you are saying. Have you finished what you wanted to say to the Court?

MR MacFARLANE: More or less, but the bit about, you know, the court has not got the power to award costs up front, it is in that security of costs there. Section 83.11 out of the Supreme Court Rules gives the Court the power - - -

KIRBY J: Yes. Well, you have already told us that, thank you very much.

MR MacFARLANE: Right.

KIRBY J: Mr Grant, leave aside the question of interest, because I can see how that is really bound up in the appeal to the Supreme Court from the substantive decision. We received a most imperfect application book because we have only page 18 of the matter before Justice Thomas and then we have only the last page and not the full judgment of the Court of Appeal, page 15 of the transcript before the Court of Appeal. I have no doubt it was not easy for the Court of Appeal to deal with the matter without having a legal representative before it, but I sent for the Full Court transcript and I have that, but I am not absolutely clear as to whether or not the point that Mr MacFarlane is trying to raise on behalf of the applicant has something to do with security for costs.

Is he raising a catch-22 proposition that an order for security of costs was obtained by reason of some initiative your client took, that he, therefore, does not have the funds with which to give that security and until he gets those funds he is not able to mount the substantive appeal and that, therefore, the answer that was given at first instance and in the Court of Appeal is not correct? Is that what happened or not?

MR GRANT: No, your Honour. Your Honour, in my understanding Mr MacFarlane misapprehends what Order 83 rule 11 provides for. The manner in which he reads it is that that allows the Court - - -

CALLINAN J: He should get an order for security even before he makes his application for compensation.

MR GRANT: Well, more than that, allows the Court to order that a prepayment be made by the respondent to him to enable him to prosecute his appeal. So that is my understanding of the matter, your Honours.

CALLINAN J: Has he been paid the compensation that the resuming authority acknowledged?

MR GRANT: He has, your Honour. He was paid 90 per cent of that compensation prior to the hearing before the Land Acquisition Tribunal. The Tribunal increased - - -

MR MacFARLANE: .....money for the lawyers.

KIRBY J: Just a moment, Mr MacFarlane. We will hear you in reply.

MR MacFARLANE: .....telling lies.

KIRBY J: You will get a chance in reply, please. We do this in an orderly fashion. Yes.

MR GRANT: The Tribunal increased the amount of the offer that the respondent had made by some $31,000, whereupon the applicant appealed against that determination. That $31,000 differential - - -

KIRBY J: That is the hearing that has not yet taken place, that is the substantive hearing?

MR GRANT: Correct, your Honour.

CALLINAN J: Does the Tribunal have power to order costs?

MR GRANT: It does, your Honour.

CALLINAN J: And did it give him costs because he succeeded to the extent of 31,000?

MR GRANT: No, your Honour, no application was made for costs.

KIRBY J: Instead of going with his substantive appeal, he appealed against the costs order, is that correct?

MR GRANT: Your Honour, he made no application for costs before the Land Acquisition Tribunal, lodged the substantive appeal and then brought on this preliminary point, again seeking a prepayment, if you like, of his costs so that he could prosecute the appeal. The position the Court of Appeal took in relation to his costs before the Tribunal was that he needed to make the application there before there was any determination in respect of which they could exercise their jurisdiction.

CALLINAN J: Can he go back to the Tribunal to seek an order for costs?

MR GRANT: Subject to what the Tribunal feels the position is in relation to it being functus officio, but I would imagine that he could.

KIRBY J: Can he get such an order from the Supreme Court anyway in relation to the proceedings before the Supreme Court or is it only the Tribunal that can give the order for, as it were, anticipatory costs?

MR GRANT: Your Honour, that depends upon which construction of section 27, now repealed - section 27 and 87 of the Lands Acquisition Act is adopted. The position that the Court of Appeal took in relation to that matter was that they could not - or the Supreme Court could not make any order in respect of the costs before the Tribunal.

KIRBY J: But he has not exhausted his rights before the Tribunal to ask them to reopen the matter and to provide him with anticipatory costs?

MR GRANT: Has made no attempt to do so. I should also say, your Honours, that in or about November last year the respondent offered to fund, up to a certain point, the applicant approaching legal advisers for the purpose of taking advice in relation to those matters, but the respondent has not taken up on that offer as yet.

KIRBY J: Is that offer still open?

MR GRANT: I have no instructions on that, your Honour, but in order to save the time of the courts in the Territory and the Tribunal, I would imagine - or I would certainly recommend to the client that the offer remain open.

KIRBY J: Yes, very well. Thank you, very much, Mr Grant. We do not need your assistance further. Yes, do you have anything in reply to that, Mr MacFarlane?

MR MacFARLANE: There lies the problem, he wants to pay my solicitor. If he starts paying my solicitor, he has got control of him. I want money in my pocket so my solicitor, whatever I tell him to do, does what I tell him, not what the government want him to do. This business about the - - -

KIRBY J: That would be your solicitor's duty.

MR MacFARLANE: Sorry?

KIRBY J: That would be your solicitor's legal, professional duty, to act on your instructions. Many people are funded from the public purse but solicitors throughout this country adhere to their obligations to their client.

MR MacFARLANE: That is not the point, though. The point is he has referred all my - - -

KIRBY J: Mr MacFarlane, you are really not looking after your own best interests or, more particularly, that of the company. You are floundering around - - -

MR MacFARLANE: I see, I thought I was. I thought I was doing all - I thought I was - - -

KIRBY J: You are floundering around and it is not really your fault because you have entered into quite a complicated area of the law. There are lots of tricks in it.

MR MacFARLANE: I have not entered into it, your Honour. I have been pulled into it by the acquisition - - -

KIRBY J: You say you have not had any difficulty, but you have not had much success lately and it is important for you to look at whether or not it would not be better for you to take up the offer which has been made - you can lay down any condition that it be done in an appropriate fashion - to provide you with the funds to get legal advice - - -

MR MacFARLANE: Not interested, your Honour, not interested.

KIRBY J: Well, you are not interested. Well, that is up to you. Just think about it.

MR MacFARLANE: What I am interested in - what I am interested in, though, is seeing all of my assets have been referred to the court as security with the compulsory acquirer's costs, that I be paid the value of my assets. I am willing to gamble with my assets. That is what it is, it is a gamble. I am gambling with my assets that I am right in the compulsory acquisition. At the moment I am gambling with it but I have not got no money.

KIRBY J: Yes, but you are gambling in a particular place where, unless you have legal advice, unfortunately, the odds are against you. You need to get legal advice and, really, you are wasting the time of the courts. You are wasting your own time. You are not advancing your own interests as best they could be advanced. And you have really got to think about whether this is a sensible course for you to adopt. I know some people get stubborn and they want to stand on what they think are their rights, but you have not had much success so far and you have not even got to the substantive matter. You have not got to your substantive appeal.

MR MacFARLANE: That does not mean there is something wrong, though. That does not mean to say - just because I have not had any - - -

KIRBY J: Your substantive appeal is still outstanding. Anyway, do you have anything else to say to what Mr Grant has told us?

MR MacFARLANE: To what Mr Grant - Mr Grant construed this section - he says go back to the Tribunal. This section 83, 83.11 of the - not section, whatever it is, 83.11 of the Supreme Court Rules - 83.11, have you got a copy? I actually forgot to fax it yesterday:

83.11 SECURITY FOR COSTS

(1) If a tribunal -

that means you do not have to go back to the Tribunal, the Supreme Court overrides the bloody Tribunal.

If a tribunal, a decision of which is the subject of an appeal, has power to award costs -

Right. The Tribunal has got the power to award costs. If it does not, the Supreme Court has got the power to award costs. They are saying they have not, "You have got a wait another five or six bloody years until you go broke and then we will give you a few dollars later." They have got the power to award costs. They have got all my assets as security for their bloody costs, and they have not given me a cent. It has got to be wrong. It cannot be bloody right.

They are holding the piece of land they have taken off me, holding the rest as security for costs for acquiring this bit, and given me nothing and telling me I have got to run back to some idiot Tribunal down here that has got a solicitor as its bloody head man. Anyway, what it says:

the Court may, in special circumstances, order that such security as it thinks fit be given for the costs of the appeal.

It would not be the cost of the government's appeal because they are not appealing. It is the cost of my appeal and I have got all my assets. I am prepared to gamble with all my assets because I know I am bloody right. They are holding them, anyway. They have got a court order on my title here, holding my assets, stopping me from transferring them - - -

KIRBY J: Yes.

MR MacFARLANE: - - - because they know I am right and they are getting into an area now where it is getting towards damages. If the bloody bill gets too much bigger, a man will get knocked off. That is how bloody bad it is getting.

KIRBY J: Yes, anything else?

MR MacFARLANE: No.

KIRBY J: There is no error in the judgment of the Court of Appeal of the Northern Territory.

The application to this Court is made well out of time. No explanation has been given to the Court for the provision of an extension of time. The applicant corporation was not legally represented on the return of the application. In any case, the decision of the primary judge which the applicant appealed to the Court of Appeal was interlocutory in nature. It concerned costs and interest relating to a substantive decision of the Northern Territory Lands Acquisition Tribunal. That decision itself has been the subject of an appeal to the Supreme Court of the Northern Territory. It awaits hearing.

According to rulings of the Supreme Court of the Northern Territory, such an appeal is by way of a hearing de novo. Upon any such appeal the issue of costs and interest may be raised by the applicant. The primary judge and the Court of Appeal pointed this out to the applicant and to Mr MacFarlane who was allowed to speak in support of the applicant. So far he has not attended. It may be hoped that now he will.

The application is dismissed.

AT 2.54 PM THE MATTER WAS CONCLUDED