Brar v Westpac Banking Corporation
[2009] FMCA 360
•14 April 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| BRAR v WESTPAC BANKING CORPORATION | [2009] FMCA 360 |
| BANKRUPTCY – Review of Registrar’s sequestration order – no grounds established – application refused. |
| Bankruptcy Act 1966 (Cth), s.52(2)(a) Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth), r.4.06(3) |
| Totev v Sfar (2008) 167 FCR 193 |
| Applicant: | BALWANT SINGH BRAR |
| Respondent: | WESTPAC BANKING CORPORATION ACN 007 457 141 |
| File Number: | SYG 3082 of 2008 |
| Judgment of: | Smith FM |
| Hearing date: | 14 April 2009 |
| Delivered at: | Sydney |
| Delivered on: | 14 April 2009 |
REPRESENTATION
| Counsel for the Applicant: | Applicant in person |
| Counsel for the Respondent: | Ms J Alford |
| Solicitors for the Respondent: | Gadens Lawyers |
ORDERS
The application for review filed on 26 March 2009 is dismissed.
The orders made by the Registrar on 6 March 2009 are affirmed.
The respondent’s costs, including all reserved costs, be taxed and paid from the estate of the applicant in accordance with the Bankruptcy Act 1966 (Cth).
The respondent must within 2 days give a copy of this order to the Official Receiver in Sydney and to the applicant’s trustee in bankruptcy.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 3082 of 2008
| BALWANT SINGH BRAR |
Applicant
And
| WESTPAC BANKING CORPORATION ACN 007 457 141 |
Respondent
REASONS FOR JUDGMENT
(revised from transcript)
This is an application for review of an order of the Registrar making a sequestration order on 6 March 2009. There is no evidence before the Court that the applicant has complied with the rules requiring service of the application on the trustee and creditors. However, in the circumstances of the matter, in particular its lack of any apparent merit, I am disposed to dispense with those requirements and address the matter today.
The petition was filed on 25 November 2008, and relies upon a debt in the sum of $148,548.37. This was the balance owing on a Supreme Court judgment debt obtained by Westpac against a company, 3B Construction Group 1 Pty Ltd (In Liquidation), as well as the company itself and three natural people, one of whom was Mr Brar. That judgment was in the sum of $966,045.19.
From what I am told by Mr Brar, Westpac has sold property held by way of security in relation to that debt, leaving the balance owing by Mr Brar and the other judgment debtors. The circumstances concerning whether the Bank is pursuing those other defendants, and if not why not, are not shown in any evidence before me.
Mr Brar does not dispute that he is indebted to the Bank in the amount identified in the petition, and this is verified by an affidavit of debt sworn on 9 April 2009 and filed today.
The petition relies on an act of bankruptcy, being Mr Brar’s failure to comply with the requirements of a bankruptcy notice based upon the judgment debt, which was served on him on 25 September 2008. Service of the notice and its validity is not challenged by Mr Brar, and I am satisfied that he committed the act of bankruptcy relied upon in the petition, giving rise to an act of bankruptcy on 16 October 2008.
The evidence also satisfies me as to the other matters required to be established in support of the petition, and that the Bank has made out its entitlement today to the making of a sequestration order, subject to it filing an updating affidavit of search under r.4.06(3) of the Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth). This is required on the review of the Registrar’s sequestration order, even where the order is affirmed (see Totev v Sfar (2008) 167 FCR 193).
Mr Brar did not file a notice of grounds of opposition before the Registrar, but attended on 6 March 2009, and was heard by the Registrar in support of his application for more time. It appears that the Registrar received some evidence from the applicant, possibly informally and certainly not on any affidavit, as to Mr Brar’s assets. According to the Registrar’s notes, this confirmed what Mr Brar has told me today. That is, that his own assets are insufficient to pay this debt to the Bank within the reasonably foreseeable future. He has not presented any evidence to the Court that he is able to pay this debt and his other debts for the purposes of s.52(2)(a) of the Bankruptcy Act 1966 (Cth).
His application for review is supported by an affidavit but it merely says:
1.Order is not fair (as I am 1/3 of this debt).
2.Not given me enough time.
Mr Brar today explained to me what is clear from the Supreme Court order, that he is a joint and several debtor for a debt, and that other people may also be indebted under the order. However, he has not put before me any facts indicating that there would be good reason for declining to allow Westpac to pursue him for the outstanding indebtedness, including by way of bankruptcy.
Mr Brar’s request for more time was put by him on the basis that perhaps in five years he might be able to have paid off the debt. But that plainly would not be a reasonable period to expect a creditor to wait for payment of a debt of this size. Plainly, it would require an adjournment of the petition for far longer than is permitted by the Bankruptcy Act.
I am not satisfied that Mr Brar has presented to the Court any evidence or reason upon which the Court’s discretion to decline to make a sequestration order could be exercised.
On all the material before me I consider that the Registrar made the correct order on the evidence before him, and the order remains the correct order which should be made by me when reviewing the Registrar’s order de novo today.
I therefore propose to make a formal order dismissing the application and affirming the order of the Registrar after lunch when, as I have indicated, I shall expect the Bank to have an updating affidavit under r.4.06.
I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of Smith FM
Associate: Lilian Khaw
Date: 29 April 2009
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