Bank of Western Australia Ltd v Comninos
[2011] FMCA 1013
•22 November 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| BANK OF WESTERN AUSTRALIA LTD v COMNINOS | [2011] FMCA 1013 |
| PRACTICE & PROCEDURE – Application for adjournment – where debtor seeks notice to produce for documents that might demonstrate sale of property at undervalue – dismissed. |
Corporations Act 2001 (Cth)
| Applicant: | BANK OF WESTERN AUSTRALIA LTD ABN 22 050 494 4545 |
| Respondent: | PASCALL GEORGE COMNINOS |
| File Number: | SYG 2065 of 2011 |
| Judgment of: | Raphael FM |
| Hearing date: | 22 November 2011 |
| Date of Last Submission: | 22 November 2011 |
| Delivered at: | Sydney |
| Delivered on: | 22 November 2011 |
REPRESENTATION
| Solicitors for the Applicant: | Mr A Begg |
| Solicitors for the Respondent: | Hancocks Solicitors |
ORDERS
Application for adjournment declined.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2065 of 2011
| BANK OF WESTERN AUSTRALIA LTD ABN 22 050 494 4545 |
Applicant
And
| PASCALL GEORGE COMNINOS |
Respondent
REASONS FOR JUDGMENT
There comes before me today a referred bankruptcy petition in respect of which there was filed, on 21 October 2011, a notice of intention to oppose. The grounds of the debt are familiar. The debtor is a director and sole shareholder of a company which held land that was the subject of a mortgage to the applicant. The debtor was guarantor of those obligations. On the 8 October 2010 the Supreme Court of New South Wales gave judgment against the debtor in the sum of $224,839.09 together with an order for possession of the property upon which the debt was secured. For reasons which are not relevant to these proceedings the actual judgment was dated 30 May 2011. In the meantime the property was sold under the power of sale given to the mortgagee. The debtor has notice of the sale and had certain concerns about it, which he expressed in writing through his solicitors. Notwithstanding this, he sought neither to stay the judgment nor to stay the exercise of the power of sale, nor after the power of sale was exercised in a manner which he believes to be in breach of the provisions of the Corporations Act 2001 (Cth) did he commence any proceedings against the bank.
The bankruptcy notice was served upon him on 8 August 2011. I note proceedings to set aside that notice were taken. The petition, which was issued on 14 September 2011, has been before this court, first on 21 October 2011 when it was adjourned to 15 November. On 15 November, Registrar Hedge made orders requiring affidavits to be served in support of an application for a further adjournment by 18 November. No affidavit was served by that date although an affidavit was filed in court today before the Registrar.
On that affidavit, Mr Comninos, the debtor, sets out the facts concerning the sale of the property, his belief that the property was worth around $400,000.00 and the fact of the sale of the property for $190,000.00. He exhibits correspondence, including the correspondence to which I have previously referred from his own solicitors, expressing concern about the proposed sale and a letter from Mr Angus Begg on behalf of the bank indicating on 24 March 2011 that the bank had received a benchmark valuation report on 25 November 2010 valuing the property at $140,000.00 and that it had accepted an offer for the sale of the property of $190,000.00, the sale being in March 2011.
Mr Comninos seeks an adjournment so that a notice to produce which was served on the creditor by fax at 5pm on 18 November, can be answered. The notice to produce seeks production of the sort of documents that might assist the debtor to make out a claim that the sale was made at an undervalue. The creditor seeks to set aside the notice to produce on the grounds that it is not relevant to any of the grounds in the petition or the notice of intention to oppose. I cannot say that it is irrelevant to the grounds of intention to oppose because they make reference to the sale and the applicant as mortgagee failing to adequately perform its duties when carrying out the sale of the subject property.
However, for a debtor to obtain relief in respect of a sale of an undervalue he must proceed in another court, it is not a matter that can be determined in this one. In my view, for an applicant to succeed in an application to stay the hearing of a petition or to have a petition dismissed he would have to come to this court with some quite substantial evidence of wrongdoing on the part of the bank. It is his claim and one he must establish.
In this particular case I am of the view that the applicant has had sufficient time since the sale to make out his claim or at least to obtain the necessary evidence that this court would need; for example, he could have obtained his own valuation but none is produced. He had good warning of the auction and of the bankruptcy proceedings but only comes to this court at the death knock. He has provided no evidence of his first ground of objection, namely solvency.
All in all it is my view that it is in the interests of justice that the application proceed and should not be adjourned for the purposes of requiring the creditor to provide the documents contained in the notice to produce. There being no other ground for adjournment I propose to hear the petition.
I certify that the preceding seven (7) paragraphs are a true copy of the reasons for judgment of Raphael FM
Date: 16 December 2011
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