Banks-Walker v Vince - [2016] FCCA 2750

FEDERAL CIRCUIT COURT OF AUSTRALIA

BANKS-WALKER v VINCE & ORS

[2016] FCCA 2750

Catchwords:
BANKRUPTCY – Application for annulment of debtor’s petition on the grounds that it ought not to have been presented – credibility of bankrupt – bankrupt admitting extended involvement in fraud and forgery – whether bankrupt solvent at time debtor’s petition filed.

Legislation:
Bankruptcy Act 1966 ss.58(3), 153A and 153B
Corporations Act 2001 ss.588H(2), (3) and (4)

Cases cited:
Bulic v Commonwealth Bank of Australia Ltd [2007] FCA 307
Coyle, Re (1993) 42 FCR 72; (1993) 120 ALR 527
Drake v Jones [2009] FMCA 298
Estate of Smith, Re [1999] FCA 1755
Papps v Tapp(1997) 78 FCR 524

Applicant:

MATTHEW BANKS-WALKER

First Respondent:

PETER ROBERT VINCE

Second Respondent:

DANIELLE JANINE ROCHE

Supporting Creditor:

STEPHEN JOHN MICHELL

File number:

MLG 1108 of 2016

Judgment of:

Judge Riley

Hearing date:

16 September 2016

Date of last submission:

16 September 2016

Delivered at:

Melbourne

Delivered on:

28 October 2016

REPRESENTATION

Counsel for the applicant:

John K. Arthur

Solicitors for the applicant:

Mackinnon Jacobs Lawyers

Counsel for the respondents:

Daniel C. Harrison

Solicitors for the respondents:

Lewis Holdway Lawyers

Advocate for the supporting creditor:

Ivan Hristovski

Solicitors for the supporting creditor:

Gadens Lawyers

ORDERS

The application filed on 26 May 2016 and amended on 16 September 2016 be dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 1108 of 2016

MATTHEW BANKS-WALKER

Applicant

And

PETER ROBERT VINCE

First Respondent

And

DANIELLE JANINE ROCHE

Second Respondent

And

STEPHEN JOHN MICHELL

Supporting Creditor

REASONS FOR JUDGMENT

Introduction

This is an application for annulment of a bankruptcy pursuant to s.153B of the Bankruptcy Act 1966 (“the Act”). The application was brought by the bankrupt. He became bankrupt upon the presentation of a debtor’s petition on 2 December 2015. The respondents were appointed as trustees of the bankrupt estate of the bankrupt.
Section 153B of the Act relevantly provides as follows:
(1)If the Court is satisfied that…, in the case of a debtor's petition, that the petition ought not to have been presented … the Court may make an order annulling the bankruptcy.
(2)In the case of a debtor's petition, the order may be made whether or not the bankrupt was insolvent when the petition was presented.
The applicant’s grounds, as set out in his application filed on 26 May 2016 and amended by leave granted on 16 September 2016, are as follows:
1.An order annulling the Applicant’s bankruptcy pursuant to s. 153B Bankruptcy Act 1966 (Cth.) on the grounds that the debtor’s petition ought not to have been presented to the Official Receiver by reason that:
(a)the debtor’s petition amounted to an abuse of process as, properly advised, the applicant would not have presented it and he was solvent;
(b) the Applicant was not insolvent; and
(c)in the Court’s discretion the bankruptcy ought to be annulled.
Essentially, the bankrupt argued that:
a)he was poorly advised by the first respondent to file a debtor’s petition when he could…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Banks-Walker v Vince

Details

AGLC: Banks-Walker v Vince [2016] FCCA 2750
Case: [2016] FCCA 2750
Decision Date: 28 October 2016

CaseChat Overview and Summary

Banks-Walker (the applicant) sought to have a costs order made against her in favour of Vince (the respondent) set aside. The dispute arose from earlier proceedings in the Federal Circuit Court of Australia, where the applicant had been ordered to pay the respondent's costs. The applicant sought to set aside this costs order on the grounds that the respondent had failed to disclose material information to the Court during the original hearing.

The primary legal issue before Judge Riley was whether the respondent had engaged in misleading or deceptive conduct in contravention of section 18 of the Australian Consumer Law, or alternatively, whether the respondent had breached an implied undertaking to the Court by failing to disclose material information. The Court was required to determine if the applicant had established the necessary elements for setting aside the costs order based on these alleged breaches.

Judge Riley found that the applicant had not established that the respondent had engaged in misleading or deceptive conduct. The Court reasoned that the information the applicant alleged was not disclosed was not material to the original decision regarding costs. Furthermore, the Court determined that there was no breach of an implied undertaking to the Court, as the applicant had not demonstrated that the respondent had deliberately withheld information with the intention of misleading the Court. The Court applied the principles that a party seeking to set aside a costs order on such grounds must demonstrate a high degree of culpability on the part of the other party.

The application to set aside the costs order was dismissed.

Orders