Australian Co-operative Foods Ltd v Leung

[2006] FMCA 695

FEDERAL MAGISTRATES COURT OF AUSTRALIA

AUSTRALIAN CO-OPERATIVE FOODS LTD v LEUNG & ANOR [2006] FMCA 695

BANKRUPTCY – Debtor’s Petition – referred to the Court by the Official Receiver for directions – creditor’s petition pending against joint debtors.

Bankruptcy Act 1966 (Cth), s.55

Official Receiver of the Bankruptcy District of Victoria v Walia(1997) 79
FCR 299

Applicant: AUSTRALIAN CO-OPERATIVE FOODS LTD (TRADING AS DAIRY FARMERS)

Respondents: PAUL LEUNG and STEPHEN GERARD OLIVER

File number: SYG1016 of 2006

Judgment of: Lloyd-Jones FM

Hearing date: 9 May 2006

Delivered at: Sydney

Delivered on: 19 May 2006

REPRESENTATION

Solicitor for the Applicant: Ms K Probert (as agent)

Respondents: Mr Leung in person

ORDERS

1. The Official Receiver is directed to accept the Debtor’s Petition filed on 1 May 2006.

2. Costs are reserved.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG1016 of 2006

AUSTRALIAN CO-OPERATIVE FOODS LTD (TRADING AS DAIRY FARMERS)

Applicant

And

PAUL LEUNG and STEPHEN GERARD OLIVER

Respondents

REASONS FOR JUDGMENT

The proceedings

1. This is a debtor’s petition that has been referred to the Court under the provisions of s.55(3B) of the Bankruptcy Act 1966 (Cth) (“the Act”) for a direction to the Official Receiver to either accept or reject the petition. A referral of the debtor’s petition was filed on 1 May 2006 together with a statement of affairs.

2. A creditor’s petition was filed in these proceedings on 5 April 2006 in respect of a judgment debt made in the Local Court at North Sydney on 21 January 2006 in respect of a bankruptcy notice served on the first respondent debtor Paul Leung on 6 March 2006.  The bankruptcy notice was served on the second respondent debtor, Stephen Gerard Oliver on 7 March 2006.

3. The right to present a debtor’s petition is found in Division 3 of Part IV of the Act. Section 55(1) provides that a debtor may present a petition against himself, which is the situation before this Court. Mr Oliver, the second respondent debtor, is not a party to the debtor’s petition. The petition has been presented to the Official Receiver who then referred it to the Court.

4. When a debtor presents a petition to the Official Receiver against himself, it must be in the approved form and accompanied by a statement of affairs: s.55(2) of the Act. The Official Receiver may reject the debtor’s petition if the petition does not substantially comply with the approved form or is not accompanied by an adequate statement of affairs: s.55(3) of the Act. In the current circumstances, the creditor’s petition has been presented against a group of debtors (Mr Leung and Mr Oliver) while the debtor’s petition has been presented by one member of that group (Mr Leung). Consequently, the Official Receiver is required to refer the debtor’s petition to the Court for a direction to either accept or reject it: s.55(3B) of the Act.

5. There are three categories of debtors who are not entitled to present a petition without the condition of the Court, being those identified in ss.55(5A), 55(6) and 55(6A). There is no evidence before me that indicates that Mr Leung is subject to these provisions.

6. There is a general requirement that bankruptcy law only applies to a person who has some connection with Australia.  Mr Leung indicates that he is a resident in Australia and holds an Australian passport and a current New South Wales driver’s licence.  He is married with four daughters, with whom he resides. 

7. The presentation of the petition by a debtor is a voluntary act.  This was confirmed by the debtor, Mr Leung, in a statement he made from the bar table.  He advised the Court that he wished this matter to be resolved as quickly as possible to enable him to get on with his life.

8. A representative of the Official Receiver, although not officially represented, handed up in Court copies of the Affidavit of Service of Referral of Debtor’s Petition, indicating that the following parties had been provided with a copy of the referral of debtor’s petition number SYD1016 of 2006 signed by an officer authorised by an official receiver:

   a)Stephen Gerard OLIVER on Friday 5 May 2006 at 12.55pm, served personally at Beachcomber Surfers Resort, Hanlan Street, Surfers Paradise in the State of Queensland;

   b)Paul LEUNG on 3 May 2006 at 9.55am, served personally at the rear of Parliament House, Hospital Road, Sydney, New South Wales by arrangement; and

   c)Messrs Ward Taylor solicitors, by delivery of the documents to Christine Riguez, a female person apparently over the age of 16 years and employ at Messrs Ward Taylor solicitors at Level 1, 495 Victoria Avenue, Chatswood, New South Wales.

   Each party received a sealed copy of the debtor’s petition and statement of affairs noting that the referral had been set down for hearing by the Court at 10.15am, 9 May 2006 in the Law Courts Building, Queens Square, Sydney, New South Wales 2000.  Other than Mr Leung, who appeared in person, none of the other parties appeared or filed in Court any response to the documents served.

9. The debtor’s petition has been completed on a pre-printed Form 6 and appears to have been correctly completed to the extent that it is possible to establish that from the material that is before the Court.  None of the parties have raised any objection to the contents of the debtor’s petition, nor has the official receiver raised any objection to the petition.

10. The statement of affairs has been completed on a pre-printed Form 3 and no objections to its contents have been raised by any other party, nor has the official receiver raised any objection to its contents.  Mr Leung has completed the acknowledgement page from the prescribed information booklet confirming that he has read the prescribed information and considered the alternative options described in the booklet and has read the consequences of bankruptcy.  This has been executed by Mr Leung dated 11 April 2006.

11. The official receiver has not raised with the Court any issue in respect of the debtor’s petition that may be presented as an abuse of procedure of the Act: Official Receiver of the Bankruptcy District of Victoria v Walia (1997) 79 FCR 299 per Finkelstein J. As there is no jurisdictional fact that needs to be satisfied or complied with other than the requirement that the petition is in the proper form and that there is an adequate statement of affairs and the presentation of a petition by a debtor is a voluntary act of the debtor and takes place within Australia, Official Receiver of the Bankruptcy District of Victoria v Walia.  I am satisfied that the relevant documents and procedural steps have been taken by the parties and that no objection has been raised by the official receiver or any other party.  In those circumstances, I believe it is appropriate that the official receiver be directed to accept the petition.

I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Lloyd-Jones FM.

Associate: 

Date:  19 May 2006