Case: Neil v Nott [1994] HCA 23 ; (1994) 121 ALR 148
Outcome: applied
is also unfortunate that the federal magistrate devoted a significant part of his reasoning to defending the position of the County Court judge in the exchange referred to in [9] above. This was but one passage of several in the transcript of the County Court proceeding before the federal magistrate in which the County Court judge appeared to be suggesting that, unless the appellants could afford to engage a lawyer, or could comply strictly with the rules of the County Court, they would lose the case. It would be a pity if, in the 21st century, any court were to take the view that precise pleadings were always necessary. Because of the decline in legal aid, and perhaps for other reasons, there is a plethora of unrepresented litigants in all courts. As the High Court said in Neil v Nott [1994] HCA 23 ; (1994) 121 ALR 148 at 150: A frequent consequence of self-representation is that the court must assume the burden of endeavouring to ascertain the rights of parties which are obfuscated by their own advocacy. It has been so in this case. It is necessary to focus on the material placed before Tadgell J and to ascertain whether, on that material, a refusal to extend time bespeaks an error of principle affecting the exercise of the discretion to extend time. It may be that, as was the case in Neil v Nott , what the High Court described at 151 as "misconceived advocacy" by the unrepresented litigant made matters difficult for the County Court judge. Nevertheless, it was apparent from what the first appellant told the County Court judge that he claimed to have a defence of the kind outlined above. Even if it could be said that the purported counterclaim of the appellants, based on alleged negligence by the respondent, was so incompetently drafted as to require striking out, it is difficult to see how the striking out of the counterclaim would justify treating the appellants as if they had no defence to the respondent's claim. For the foregoing reasons, the federal magistrate's refusal to exercise the discretion to go behind the County Court judgment in favour of the appellants should be set aside. Rather than remitting the matter to the Federal Magistrates Court, I should exercise the discretion myself. My finding that there is a substantial reason for questioning whether the County Court judgment is based on an actual debt leads to the conclusion that the discretion should be exercised in favour of setting aside the bankruptcy notice. The objections to competency Ground 1 of the respondent's notice of objection to competency is said to have been included because there is a conflict of authority as to whether a judgment given on an application to set aside a bankruptcy notice is interlocutory or final. If it were necessary to come down on one side or other of this controversy, I should be inclined to hold that the judgment was final. Subject to appeal, it determined the rights of the parties in relation to the bankruptcy notice. It is true that, if there were to be a creditor's petition, based on an act of bankruptcy constituted by a failure to comply with a demand made in the bankruptcy notice by the due time, there would be further proceedings between the two parties. They would be proceedings instituted separately, however, in respect of different rights from those the subject of an application to set aside the bankruptcy notice. It is unnecessary to determine the controversy, however. Any requirement that there be leave to appeal ought not to be allowed to stand in the way of the appellants in the present proceeding. To the extent necessary, an extension of time to seek leave to appeal should be granted, and leave should be granted to appeal, so that the appeal can be heard and determined in their favour. Ground 2 of the notice of objection to competency attacks the validity of the grounds in the notice of appeal. It is true that the grounds are not in perfect form. It could hardly be expected of a litigant in person whose first language is not English that he display the skill of a legal draftsperson. Following what the High Court said in Neil v Nott , this is another situation which the Court must not have its attention diverted by the misconceived advocacy of an unrepresented litigant, but must endeavour to ascertain the rights of the parties. There is sufficient substance in the complaints made by the appellants in the grounds of appeal to enable the appeal to proceed. The grounds are directed to criticism of the judgment of the County Court. They do contain considerations that I have held the federal magistrate should have taken into account, namely the fact that the County Court judgment is obtained by default and the allegation that the debt on which the County Court judgment was based was not in fact due. There are sufficient grounds to make the appeal competent. Grounds 3 and 4 of the notice of objection to competency refer to the fact that the notice of appeal seeks orders having the effect of setting aside the judgment of the County Court. Manifestly, this Court does not sit on appeal from the County Court in relation to judgments for debts. The presence of the claim for orders beyond the powers of this Court does not render the entire notice of appeal incompetent. Grounds 3 and 4 of the notice of objection to competency are not proper grounds for dismissing the appeal as incompetent. The orders sought by the appellants, to which grounds 3 and 4 of the notice of objection to competency relate, simply cannot be made. Conclusion The appellants' notice of motion, filed on 18 June 2009, must be dismissed. To the extent to which it is necessary, time should be extended to enable the appellants to apply for leave to appeal, and leave should be granted to the appellants to appeal from the judgment of the Federal Magistrates Court. The appeal should be allowed and the orders made by the federal magistrate should be set aside. For those orders, there should be substituted an order setting aside the bankruptcy notice.