Baulkham Hills Shire Council v Stankovic (No 6)

[2010] NSWLEC 33

Land and Environment Court

of New South Wales

CITATION:	Baulkham Hills Shire Council v Stankovic (No 6) [2010] NSWLEC 33
PARTIES:	APPLICANT: Baulkham Hills Shire Council RESPONDENT: Milovan Stankovic
FILE NUMBER(S):	41243 of 2004
CORAM:	Pain J
KEY ISSUES:	PRACTICE AND PROCEDURE :- whether standing to bring Notice of Motion - bankruptcy and standing.
LEGISLATION CITED:	Uniform Civil Procedure Rules 2005 r 6.30(1), r 6.30(2) Bankruptcy Act 1966 (Cth) s 5, s 58(1)(a)
CASES CITED:	Cummins v Claremont Petroleum (1966) 185 CLR 124 Hedwan v Hannouf (1997) 140 FLR 229
DATES OF HEARING:	12 March 2010
EX TEMPORE JUDGMENT DATE:	12 March 2010
LEGAL REPRESENTATIVES:	APPLICANT Mr M Pearce (solicitor) SOLICITOR The Hills Shire Council RESPONDENT In person TRUSTEE IN BANKRUPTCY Mr Gourlie (solicitor)

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Pain J

12 March 2010

41243 of 2004 Baulkham Hills Shire Council v Stankovic (No 6)

EX TEMPORE JUDGMENT

1 Her Honour: The Respondent, Mr Stankovic, has filed a Notice of Motion on 10 March 2010 which seeks various orders including that there be a stay of the orders made on 14 March 2005 and, alternatively, that all orders made be set aside pending an investigation of certain matters.

2 Mr Gourlie, a solicitor representing the trustee in bankruptcy appointed on 13 May 2009 to the estate of the Respondent, appeared and submits that the Notice of Motion must be dismissed because the Respondent has no standing to pursue the Notice of Motion. His property is vested in the trustee as the Respondent is bankrupt and the subject matter of these proceedings is part of the Respondent’s property, being various chattels located on land owned by the Respondent at the time he was made bankrupt. The proper course is that any such motion should proceed through initiation by the trustee in bankruptcy who can be joined under r 6.30(2) of the Uniform Civil Procedure Rules 2005 (the UCPR).

3 UCPR r 6.30(1) and (2) states:

6.30 Effect of certain changes on proceedings
(1) Proceedings do not abate as a result of a party’s death or bankruptcy if a cause of action in the proceedings survives.

(2) If a cause of action survives, and the interest or liability of a party to any proceedings passes from the party to some other person, the court may make such orders as it thinks fit for the joinder, removal or re-arrangement of parties.
…

4 The trustee’s solicitor, Mr Gourlie, submits that r 6.30(2) applies because if a cause of action survives a bankruptcy declaration the trustee must determine whether to pursue it. Under r 6.30 (2) the trustee could choose to apply to be joined as a party to the proceedings. In the absence of the trustee doing so. the Respondent has no standing. This is confirmed by Cummins v Claremont Petroleum (1996) 185 CLR 124 where the High Court held that a bankrupt has no standing to institute appeals from a judgment. In Hedwan v Hannouf (1997) 140 FLR 229 Santow J held a bankrupt has no standing to institute proceedings to set aside a judgment.

5 The Respondent submitted that the trustee in bankruptcy made a similar unsuccessful application in the Family Court proceedings in which he is presently engaged. He also submitted that a similar application was rejected in the Court of Appeal in an appeal by the Council in these proceedings where the Respondent was the respondent on the appeal. Accordingly, there is no reason why the Respondent cannot take these proceedings in his own right. Nothing he is doing will impact negatively on the property vested in the trustee as he is seeking to defend these proceedings.

6 These submissions were refuted by Mr Gourlie who stated that the trustee was joined as a party in the Family Court proceedings and the judge allowed the Respondent to prepare evidence in light of the issues arising in that matter. On appeal by the Council in this matter the trustee told the Court of Appeal it did not wish to participate. The Court of Appeal gave the Respondent leave to appear as there was otherwise no contradictor to the Council’s appeal. That appeal was later discontinued.

Finding

7 Neither of the circumstances in the Family Court or the Court of Appeal provide any guide as to how this Notice of Motion should be considered in this Court as the circumstances are different. The Respondent is seeking to commence an action to set aside a judgment and while not explicitly stated in the Notice of Motion, by implication to appeal against orders made by the Court, now many years ago.

8 Assuming the Notice of Motion filed does constitute a cause of action, about which I make no finding, the subject of the proceedings which the Notice of Motion seeks to set aside does concern property being chattels on land now vested in the trustee in bankruptcy. Further, the property of the bankrupt is defined under s 5(1) of the Bankruptcy Act 1966 as:

"the property of the bankrupt" in relation to a bankrupt, means:

(a) …
(ii) any rights and powers in relation to that property that would have been exercisable by the bankrupt if he or she had not become a bankrupt;
…
Therefore a right of appeal in relation to property is property of the bankrupt as defined in s 5(1), which vests in his or her trustee by s 58(1)(a). This is consistent with the finding in Hedwan v Hannouf of Santow J at 231.

9 The operation of the Bankruptcy Act as discussed in Cummins to the effect that a bankrupt has no standing to institute an appeal from a judgment and Hedwan that a bankrupt has no standing to set aside a judgment, combined with UCPR r 6.30(2) confirm that the trustee’s position is correct so that the Respondent does not have standing to pursue his Notice of Motion and it cannot proceed. The Notice of Motion should be dismissed. I note the advice of Mr Gourlie is that the Respondent can approach the trustee asking that he pursue the Notice of Motion so that the trustee can consider whether that can and should be done.

Orders

10 The Court makes the following orders:

1. The Respondent’s Notice of Motion dated 10 March 2010 is dismissed.
2. Costs of the proceedings are reserved.