AMP Finance Limited v Burns (N0.1)
[2005] FMCA 646
•12 May 2005
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| AMP FINANCE LIMITED v BURNS (N0.1) | [2005] FMCA 646 |
| BANKRUPTCY – Application for adjournment – where a promissory note in excess of debt allegedly owed was tendered – where the promissory note was not signed nor sealed by the judgment debtor – where the promissory note is a conditional document and appears defective. |
| Australian Mid Eastern Club Limited v Yassim, 1989 1ACSR 399 |
| Applicant: | AMP FINANCE LIMITED |
| Respondent: | JOHN BURNS |
| File Number: | SYG 2624 of 2004 |
| Judgment of: | Raphael FM |
| Hearing date: | 12 May 2005 |
| Date of Last Submission: | 12 May 2005 |
| Delivered at: | Sydney |
| Delivered on: | 12 May 2005 |
REPRESENTATION
| Counsel for the Applicant: | Peter Newton |
| Solicitors for the Respondent: | Foleys Solicitors |
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2624 of 2004
| AMP FINANCE LIMITED |
Applicant
And
| JOHN BURNS |
Respondent
REASONS FOR JUDGMENT
The respondent debtor comes to court on 12 May 2005, the adjourned hearing of the petition, seeking an adjournment. The grounds upon which he seeks that adjournment is that a promissory note to the value of $25 million, an amount in excess of the debt allegedly owed, was handed to the creditor and has not been presented for payment. The application is, in effect, an application that a tender has been made. There are a number of problems with the certified promissory note, a copy of which is annexed to the affidavit of Mr Burns dated 3 May 2005. The copy is not a good one, and I assume for the purposes of this judgment that the date is March 2005, and not, as it appears to me, March 2006, but the first problem that becomes evident is that the document states that:
The instrument is tendered by the undersigned, Dolroy Pty Limited.
If one them looks down the promissory note, one will see that it is, in fact, signed and sealed by a company known as Michael John Szita Limited. The common seal of that company is attached. The names of two persons as witnesses are inscribed, but it is not suggested that they are directors or a secretary of that company. This company is not Dolroy Pty Limited. In any event, Dolroy Pty Limited is a judgment debtor of the creditor in these proceedings, which has not paid its judgment debt and presumably cannot. I have little doubt that if the promissory note was presented for payment the payor would decline to make payment on the grounds that the promissory note is defective. In addition, the promissory note is a conditional document, which appears to me to have been drawn in accordance with the laws of the United States of America. A conditional document is not an unconditional tender.
Mr Newton, on behalf of the creditor, has referred me to Australian Mid Eastern Club Limited v Yassim, 1989 1ACSR 399, a decision of the Court of Appeal of New South Wales where their Honours say at [403]:
If a valid tender be made, a refusal of that tender (whether for good or bad reason, or for no reason at all) does not eliminate the debt in question. The relationship of creditor and debtor still subsists. The tender is no answer to a claim for the debt unless (as did not happen here) there is a continued readiness to pay, coupled with an actual payment into court.
For all those reasons, the existence of the promissory note and the failure of the creditor to present it to the payor does not stand as a good reason for me to grant the debtor an adjournment. I decline to do so.
I certify that the preceding three (3) paragraphs are a true copy of the reasons for judgment of Raphael FM
Associate:
Date:
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