American Express Australia Limited v Michaels

The case of American Express Australia Limited v Michaels involved a petition for sequestration against David Michaels, brought by American Express Australia Limited. The petition claimed that Michaels had committed an act of bankruptcy on or around 7 July 2009, and that at the time, he had connections to Australia sufficient to justify the court's jurisdiction to make a sequestration order under s.43(1)(b) of the Bankruptcy Act. Specifically, the petition alleged that Michaels was ordinarily resident in Australia, had a dwelling-house in Australia, or was carrying on business in Australia at the relevant time. The case hinged on whether Michaels had a dwelling-house in Australia as of the date of the alleged act of bankruptcy.

The primary legal issue before the court was whether Michaels's circumstances at the time of the alleged act of bankruptcy met the jurisdictional criteria of s.43(1)(b) of the Bankruptcy Act. This involved interpreting the phrase "had a dwelling-house or place of business in Australia" and determining whether Michaels satisfied this condition. The court considered whether Michaels had a house in Australia that he used or could use as his residence and to which he could return at his discretion. The court examined the evidence presented by American Express Australia Limited, which detailed Michaels's connections to Australia, and assessed whether these connections were sufficient to establish the necessary jurisdictional criteria.

The court found that Michaels did indeed have a dwelling-house in Australia at the time of the alleged act of bankruptcy. The reasoning was based on the interpretation of the term "dwelling-house" as articulated in previous cases. The court held that having a dwelling-house in Australia did not require actual occupation but could be satisfied by a house that a debtor uses or has used and may use as their residence. Given the evidence presented, the court concluded that Michaels met the jurisdictional requirement. Consequently, the court determined that it had the jurisdiction to make a sequestration order against Michaels's estate.

The court ordered that a sequestration order be made against the estate of David Michaels, with American Express Australia Limited's costs to be taxed and paid from Michaels's estate. The date of the act of bankruptcy was noted as 7 July 2009. Additionally, the court directed that a copy of the order be provided to the Official Receiver in Sydney within two days.