Biddick and Etier
[2018] FamCA 744
•20 September 2018
FAMILY COURT OF AUSTRALIA
| BIDDICK & ETIER | [2018] FamCA 744 |
| FAMILY LAW – BANKRUPTCY – operation of consent orders – effect of bankruptcy – where wife has become bankrupt - where trustee has not made election to continue proceedings within 28 days – where proceedings deemed abandoned – where wife retains aspect of right to litigate – matter re-listed for directions. |
| Family Law Act 1975 (Cth) Bankruptcy Act 1966 (Cth) s 60 |
| Sloan v Sloan [2018] FamCA 610 |
| APPLICANT: | Ms Biddick |
| RESPONDENT: | Mr Etier |
| FILE NUMBER: | CAC | 2015 | of | 2016 |
| DATE DELIVERED: | 20 September 2018 |
| PLACE DELIVERED: | Canberra |
| PLACE HEARD: | Canberra |
| JUDGMENT OF: | Gill J |
| HEARING DATE: | 10 September 2018 |
REPRESENTATION
| SOLICITOR FOR THE APPLICANT: | Ms Wynn, duty lawyer |
| SOLICITOR FOR THE RESPONDENT: | Self-representing |
Orders
The Amended Application for Final Orders of Ms Biddick, filed 8 March 2018, is deemed abandoned.
The Amended Response to Final Orders of Mr Etier, filed 17 April 2018, is adjourned to 17 December 2018 for directions.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Biddick & Etier has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT CANBERRA |
FILE NUMBER: CAC 2015 of 2016
| Ms Biddick |
Applicant
And
| Mr Etier |
Respondent
REASONS FOR JUDGMENT
In the expectation that they would finally resolve all proceedings between them, the parties filed terms to be made by consent, executed by the applicant on 6 July 2018 and by the respondent on 11 July 2018. They provided, in general terms, for the parties to each retain their property, each to be responsible for their own debts, and that there would be no claim for spousal maintenance. They also provided for the following order to be made:
(6) That Ms Biddick immediately cease and desist in publishing (in any form) or verbalising defamatory statements that are directed or pointed or inferred at Mr Etier. That at all times information held by the parties by either of them remain confidential. That settlement between the parties confers that all legal disputes between the parties are settled and neither party will commence any proceedings against either party at any time.
Given the nature of the dispute between the parties to date, this term was centrally important to the consent resolution. However, two difficulties arose, which were identified to the parties on 23 July 2018.
Firstly, the power to make the orders at (6) is not apparent. The parties were unable to provide assistance to identify the head of power under which such orders could be made. Even if a head of power could be identified, the terms of the injunctive relief sought are impossibly broad. For example, the reference to “information held by the parties” is not confined to any subject matter, but rather cast at large. An injunction could not be made in these terms. Given that the term is essential to the consent, the orders could not be made for this reason.
While it was suggested for Ms Biddick that perhaps the matter could be cured by simply recording (6) as a notation, coupled to an undertaking to those effects by Ms Biddick, no consent was available to this course. In any event, it is highly doubtful that an undertaking could be received in such terms.
Secondly, Ms Biddick has become bankrupt since the commencement of proceedings. The question of what consequences flow from the circumstances was raised with the parties. In particular the operation of s 60 of the Bankruptcy Act1966 (Cth) was raised.
An email string between Ms Biddick and Mr B (the trustee in bankruptcy for Ms Biddick) was provided to the court,[1] which identified that Mr B approved the consent terms.
[1] Exhibit A1.
Prior to the matter returning before the court on 10 September 2018 for further directions and hearing, Mr Etier provided Mr B with written notice of the proceedings in the Family Court of Australia.[2] Twenty eight days has passed since Mr B receive this notice, and no election to continue with the proceedings has been provided to the court.
[2] Exhibit H1.
The relevant terms of s 60 of the Bankruptcy Act 1966 are as follows:
60(2) An action commenced by a person who subsequently becomes a bankrupt is, upon his or her becoming a bankrupt, stayed until the trustee makes election, in writing, to prosecute or discontinue the action.
60(3) If the trustee does not make such an election within 28 days after notice of the action is served upon him or her by a defendant or other party to the action, he or she shall be deemed to have abandoned the action.
60(5) In this section, action means any civil proceeding, whether at law or in equity.
As I noted in Sloan v Sloan,[3] “the broad operation of s 60(2) and (3) means that in the event that the trustee has not made an election to prosecute the current proceedings, then they are first stayed and then abandoned.”
[3] [2018] FamCA 610.
The staying of the proceedings meant that absent the election by the trustee, the consent terms could not be made. The absence of an election by the trustee means that Ms Biddick’s application is deemed to be abandoned. This also means that the consent terms could not be made into orders.
While it was suggested for Ms Biddick that the continuation of proceedings meant that they could not be deemed to be abandoned, and also that the consent provided by Mr B was sufficient to enable the making of the orders, neither of those circumstances are able to overcome the operation of s 60 of the Bankruptcy Act.
This effect leaves on foot Mr Etier’s response.
It should, however, be noted that Ms Biddick’s right to litigate, insofar as it concerns “property that will not form a part of the estate available for distribution to creditors, but rather will deal with interests that will lie with the bankrupt,”[4] remains, as Ms Biddick retains standing in relation to these aspects. Whether this will result in her recommencing proceedings remains to be seen.
[4]Sloan & Sloan [2018] FamCA 610 at [25].
Mr Etier seeks that the proceedings be finally determined. They will be relisted for directions in due course to determine the priority of the matter within the list of matters awaiting trial in the Canberra registry.
I certify that the preceding fourteen (14) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Gill delivered on 20 September 2018.
Associate:
Date: 20 September 2018.