Barac v Tresfold Pty Ltd (No.2)
[2004] FMCA 852
•15 November 2004
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| BARAC v TRESFOLD PTY LTD (No.2) | [2004] FMCA 852 |
| BANKRUPTCY – Bankruptcy Notice – where notice set aside – where indemnity costs awarded – where creditor seeks vacation of orders – where creditor provides no reasonable grounds for application. |
| Applicant: | VLADIMIR BARAC |
| Respondent: | TRESFOLD PTY LIMITED TRADING AS MP SCHULTZ EXCAVATIONS ACN 003 421 985 |
| File No: | SYG 2527 of 2004 |
| Delivered on: | 15 November 2004 |
| Delivered at: | Sydney |
| Hearing date: | 15 November 2004 |
| Judgment of: | Raphael FM |
REPRESENTATION
| Counsel for the Applicant: | Mr A Gruzman |
| Solicitors for the Applicant: | David Weston & Co |
| Counsel for the Respondent: | Mr J Jobson |
| Solicitors for the Respondent: | Nemes Thomas & Co |
ORDERS
The respondent to pay the applicant’s costs to be taxed if not agreed pursuant to the Federal Court of Australia Act and Rules.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG2527 of 2004
| VLADIMIR BARAC |
Applicant
And
| TRESFOLD PTY LIMITED TRADING AS MP SCHULTZ EXCAVATIONS ACN 003 421 985 |
Respondent
REASONS FOR JUDGMENT
On 31 August, 2004 there came before me an application to set aside a bankruptcy notice. The matter had been referred to me by Registrar Hedge on 24 August. At that time Mr Gruzman, who appeared on behalf of the applicant to the motion, explained that the motion had been brought because his client claimed that the bankruptcy notice had been served upon the wrong person, his client who had the same name as the alleged debtor but was not the alleged debtor.
I gave a short judgment on that day of which it is appropriate to repeat paragraphs four to six:
“4. On 24 August 2004 this matter came before Registrar Hedge. At that time the applicant was represented by Mr Gruzman, as he is today, and the respondent by a Mr Thomas. I understand from Mr Gruzman that attempts have been made to find out whether Mr Thomas is associated in any way with the firm, Nemes Thomas & Co, Solicitors, that firm having as its principal Mr Peter A Nemes. Mr Gruzman tells me that he has not met with any success in this regard.
5.Registrar Hedge adjourned the matter until today and extended the time for compliance with the bankruptcy notice. She also ordered that the respondent was to file and serve its evidence by 12.00 noon on 27 August and noted that indemnity costs were going to be sought. The respondent has not filed and served any evidence and has not attended before me today. I can only assume that the creditor has realised the error of its ways and that it has in fact taken bankruptcy proceedings against the wrong person. It would appear that it has also issued a writ of execution against the wrong person.
6.In these circumstances I would accede to Mr Gruzman's request that the bankruptcy notice be set aside and that the costs of the application be paid by the respondent on an indemnity basis.”
Although that decision was handed down on 31 August 2004, it was not until 1 October, a month later, that the respondent to the original application issued a further notice of motion seeking that the orders made on 31 August be set aside, the bankruptcy notice be reinstated and certain other orders be made. The application was supported by an affidavit which contained a considerable quantity of correspondence passing between the two solicitors.
Today Mr Jobson appeared before me. It quickly became clear that he was not going to proceed to argue that the order made on 31 August setting aside the bankruptcy notice be set aside or for an order that the bankruptcy notice be reinstated. In fact it seemed that the sole concern that he had was on the question of indemnity costs.
The affidavit of Mr Nemes which I admitted over the objections of Mr Gruzman indicates that Mr Jobson was briefed to appear on 31 August and that he did not receive his brief that morning. Mr Nemes also deposes to the fact that he had not received a telephone call advising the firm that no one was appearing on its behalf. There is no evidence from Mr Jobson that he did receive a brief or, for example, a photocopy of that document or an explanation of why it might have gone astray.
Mr Jobson's most significant argument seems to be that in correspondence his instructing solicitors made it clear to Mr Gruzman's instructing solicitors that if a photograph was provided of Mr Gruzman's client and, presumably, the creditor was satisfied that this was not his debtor. the creditor would consent to withdraw the proceedings and pay the applicant's reasonable costs. Mr Jobson advised me that no photograph had been given to his instructing solicitors and therefore it was reasonable for him to proceed and not reasonable for me to have made an order for indemnity costs in the absence of a party.
Mr Gruzman points out that in fact a photocopy of the applicant's drivers licence with his photograph on it was provided to Mr Jobson's instructing solicitors on or around 12 August 2004 in an affidavit dated the 10th of that month and therefore the correspondence is inaccurate. Mr Jobson has not disputed this.
Apparently Mr Jobson states that his instructors wanted a coloured photograph and that was not provided. As I have not been given a photograph, or indeed any description of the "real" Mr Barac I am unable to say how a colour photograph would have made any difference to a black and white one in terms of recognising the person who was served.
It is clear from my judgment that the reason that I awarded Mr Gruzman's client indemnity costs on the day was because it seemed to be clear from the notes of Registrar Hedge that Mr Jobson's client and instructing solicitors had been well aware of the fact that indemnity costs would sought, had been ordered to do something which would have established the identity of the person who was the debtor and yet did nothing. As Mr Gruzman says, in the absence of any affidavits, one wonders what Mr Jobson would have done even if he had appeared. The fact is that even today, no-one was suggesting with any force that the right person was served.
I am afraid I have not found the evidence concerning the non-appearance of Mr Jobson on the day entirely satisfactory. I think that in all the circumstances I made the appropriate order on 31 August and I am not inclined now to change it. This leaves only the costs of today. I note firstly, that an application was put on for the very serious request that my original orders be set aside. This was not proceeded with and that the applicant to the notice of motion has not succeeded in his primary objective of having me change my order as to costs.
I am tempted to make another order for indemnity costs but I will not do so. I order that the respondent to the original application, being the applicant to this notice of motion, pay the applicant to the original application, the respondent to the notice of motion's costs to be taxed if not agreed pursuant to the Federal Court of Australia Act and Rules.
I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Raphael FM
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