Re: MICHEAL EDWARD AUGUSTYN
And: BERNARD PUTNIN the trustee of the property of BRONISLAW (BRUNO) AUGUSTYN
and RICHARD FELIX AUGUSTYN
No. WAG111 of 1988
Bankruptcy
COURT
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Jenkinson(1), Spender(2) and French(3) JJ.
CATCHWORDS
Bankruptcy - deed of assignment - declaration that deed void - sequestration order - existence of grounds for declaration - exercise of discretion - interests of creditors - nature of interests - real possibility of financial benefit sufficient.
Bankruptcy Act 1966 s.188, s.81
Re Williamson: Ex parte Wearne (1930) 43 FLR 305
Re Levy; Ex parte Scholefield Goodman & Sons Limited (1980) 50 FLR 99
Re Beames; Ex parte Beneficial Finance Corporation Ltd (1985) 7 FCR 216
Re Doukidis Ex parte: Consolidated Constructions (unrep. 26/6/85, Toohey J.)
Re Brown; Ex parte Humes Limited (1987) 74 ALR 611
Re Moulton; Ex parte Beneficial Financial Corporation Ltd (unrep. 20/12/84)
HEARING
PERTH
#DATE 21:10:1988
Counsel for the Appellant: Mr R. Cullen
Solicitors for the Appellant: McManus Cullen and Clements
Counsel for the Respondent: Mr A.J. Templeman QC with Mr J.M. Robertson
Solicitors for the Respondent: J.N. Robertson
ORDER
The appeal be dismissed.
The appellant pay the respondent's costs of the appeal.
Note: Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.
JUDGE1
I have had the advantage of reading the reasons for judgment prepared by French J. I agree in the orders his Honour proposes and I am in substantial agreement with those reasons. I would not be disposed to limit by construction the meaning of the phrase "in the interests of the creditors" in sub-section 222(5) to those interests which consist in the economic advantage of creditors or in the prospect of such an advantage. No doubt the case would be rare in which interests of another kind would be shown to be advanced by a declaration grounded upon sub-section 222(4). And this is not such a case, so that the point of construction need not be pursued. In a case such as this the satisfaction required by sub-section 222(5) is in my opinion not limited to satisfaction that the making of the declaration will afford an economic advantage to the creditors. The words of the sub-section are apt in my opinion to comprehend satisfaction that the making of the declaration will afford a prospect or possibility of economic advantage to creditors sufficient to justify the conclusion that it is in their interests to make the declaration. That was the satisfaction which the learned trial judge attained.
JUDGE2
I have had the benefit of reading in draft form the reasons for judgement of French J.. I agree with those reasons and with his conclusion that the appeal should be dismissed with costs.
JUDGE3
On 8 April 1987 Michael Edward Augustyn, with his father, Bruno, and brother, Richard, signed an authority under s.188 of the Bankruptcy Act 1966 authorising Bernard Putnin to call a meeting of their creditors under Pt X of…
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- AGLC
- Putnin, B. v Augustyn, M.E. [1988] FCA 611
- Case
- [1988] FCA 611
- Decision Date
CaseChat Overview and Summary
The central legal issue in this case was whether the deed of assignment was valid and, if not, whether the court had the discretion to declare it void. The court had to consider the existence of grounds for such a declaration and whether it was appropriate to exercise its discretion in the interests of creditors. This required an analysis of the nature of the creditors' interests and whether there was a real possibility of financial benefit to the creditors if the deed were to be declared void.
The court found that there were grounds for declaring the deed void, as it was executed in contemplation of bankruptcy, which is a prohibited transaction. The court also considered the interests of the creditors and concluded that there was a real possibility of financial benefit to them if the deed were declared void. Therefore, the court exercised its discretion to declare the deed void and dismissed the appeal. The court ordered that the appellant pay the respondent's costs of the appeal. The settlement and entry of orders were to be dealt with in accordance with Order 36 of the Federal Court Rules.
Orders
Orders of the court
The appeal be dismissed.
The appellant pay the respondent's costs of the appeal.
Note: Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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