Case: Powerflex Services Pty Ltd v Data Access Corporation (1996) 67 FCR 65
Outcome: followed
The proper test for the granting of a stay of orders made by the Court pending appeal is laid down by the Full Court in Powerflex Services Pty Ltd v Data Access Corporation (1996) 67 FCR 65 at 66, where the Full Court rejected the test of special circumstances, which had been applied by Victorian courts and adopted the test applied in New South Wales. That test is that the applicant for a stay needs to demonstrate a reason, or an appropriate case, to warrant the exercise of the discretion in favour of the applicant. 10 Counsel for Mr Siminton attempted to persuade me that Tracey J was fundamentally wrong in his reasons for judgment, given on 26 October 2007, in that there was no evidence that Mr Siminton was carrying on the business of banking. In particular, the argument was that there was no evidence of loans made by Mr Siminton. His Honour dealt with that issue at some length. His Honour certainly found as a fact that there was evidence of one loan to Technocash. His Honour also found as a fact that, in the course of soliciting deposits from members of the public at public meetings, Mr Siminton had made it clear that in due course loans would be available. Indeed, it is difficult to envisage that funds raised in this manner could be invested in any sort of a broad investment portfolio without loans to other institutions and parties being involved. Counsel for Mr Siminton said that returns of the magnitude proposed could be generated by investment in currency markets and commodity markets. Whether or not this is so, I still think that it is difficult to imagine that no loans would ever be involved. In any event, I cannot be satisfied that Tracey J was fundamentally wrong in the view that he took, or fundamentally wrong to take the view that injunctive relief and the appointment of a receiver were warranted. 11 The next argument on behalf of Mr Siminton was an argument that Tracey J also dealt with on 15 November 2007, when he rejected the application for a stay of the appointment of the receiver. This argument was that the expenses claimed by the receiver, and fees claimed by the receiver, under para 17 of the order, would diminish the amount made available to the depositors if the appeal were to be allowed. Counsel for Mr Siminton was inclined to put this in terms of an argument that the appeal would be rendered nugatory. Of course, it will not. Even if some money goes to the receiver, there will still be other money available to the depositors, or to be returned to Mr Siminton if his appeal succeeds. It is not possible to render an appeal partially nugatory. 12 The question is whether the appointment of a receiver can be justified in the circumstances. The circumstances are such that it is unknown to what extent there are funds that have been gathered by Mr Siminton in the course of his venture that is unlawful under the Banking Act . In schedule A to the order made on 7 November 2007 appointing the receiver, there is a list of the locations of funds that were known to the Court at the time that order was made. It does seem probable that there are other funds, but Mr Siminton will not say where they are. In the circumstances, that alone justifies the appointment of a receiver and is a strong argument against staying the order pending any appeal. 13 The privilege against self-incrimination is a privilege that can be either claimed or waived by a person. If the receiver were to put questions to Mr Siminton, the answers to which might incriminate him, or were to require him to produce documents, the information in which might incriminate him, he would, on a question by question or request by request basis, have the right to refuse to answer those questions or comply with those requests if he were able to say that to give an answer or to comply with the request might incriminate him. It is wrong to assume in advance that anything that the receiver might request, or any question that the receiver might ask, might require that Mr Siminton incriminate himself. Any issue of self-incrimination must be dealt with on a question by question or request by request basis, in the context of the reasonableness of the likelihood of criminal proceedings.