Britt v Wong - [2007] FMCA 791

FEDERAL MAGISTRATES COURT OF AUSTRALIA

BRITT v WONG

[2007] FMCA 791

BANKRUPTCY – Creditor’s petition – default judgment of District Court – District Court refused to set aside judgment – insufficient reasons for going behind – sequestration order made.

Bankruptcy Act 1966 (Cth), ss.51(1), 51(2), 52(1)(a), 52(2)

Udovenko v Mitchell (1997) 79 FCR 418
Wolff v Donovan (1991) 29 FCR 480
Australian Litigation Fund Pty Ltd v Mearns (No 4) [2005] FMCA 1815

Wren v Mahony (1972) 126 CLR 212
Murdaca v Accounts Control Management Services Pty Ltd [2007] FCA 577

Applicant:

ROBERT JOHN BRITT

Respondent:

ANDREW WONG

File Number:

SYG 1396 of 2006

Judgment of:

Smith FM

Hearing date:

17 May 2007

Delivered at:

Sydney

Delivered on:

17 May 2007

REPRESENTATION

Counsel for the Applicant:

Mr M Cleary

Solicitors for the Applicant:

Warren McKeon Dickson Lawyers

Counsel for the First Respondent:

Mr P Moloney

Solicitors for the Respondent:

Moloney Lawyers

ORDERS

A sequestration order be made against the estate of Andrew Wong.
The applicant creditor’s costs, including all reserved costs, be taxed and paid from the estate of the respondent debtor in accordance with the Bankruptcy Act 1966.
Note that the petitioner alleges that the date of the act of bankruptcy is 14 March 2006.
Note that a consent to act as trustee has been signed by Phillip Kenneth Aggs and will be lodged with the Official Receiver in Sydney within

2 days.
The applicant must within 2 days obtain an entered sequestration order and give a copy the Official Receiver in Sydney.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 1396 of 2006

ROBERT JOHN BRITT

Applicant

And

ANDREW WONG

Respondent

REASONS FOR JUDGMENT

(revised from transcript)

I have before me a creditor's petition filed on 12 May 2006, seeking a sequestration order against the respondent. It alleges an act of bankruptcy and indebtedness to the applicant, both of which rely upon a judgment debt entered in the District Court of New South Wales on 24 January 2003 in the sum of $197,159.01. The debt relied on by the petition has been augmented by interest, and is now in the sum of $255,545.09.
The history of the matter in the District Court and this Court is lengthy. It includes the adjournment of the petition in this Court to allow the respondent debtor to make a third application to the District Court to set aside the judgment relied upon. That application was determined against the debtor, in a reserved decision of Kearns DCJ published on 24 January 2007.
Kearns DCJ has set out a detailed history of the proceeding in the District Court, and I do not need to repeat its details. In short, the present applicant first commenced proceedings against the present respondent in 1994, seeking recovery of a liquidated amount which was pleaded as a “loan” of $85,000 paid by the applicant and his wife to the respondent and his wife, and not repaid when demanded. The respondent and his wife filed a notice of grounds…

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 Britt v Wong

Details

AGLC: Britt v Wong [2007] FMCA 791
Case: [2007] FMCA 791
Decision Date: 17 May 2007

CaseChat Overview and Summary

Britt v Wong involved a dispute between Britt, a creditor, and Wong, a debtor. Britt sought a sequestration order against Wong's estate, citing an act of bankruptcy dated 14 March 2006. The case was heard in the Federal Circuit and Family Court of Australia. The court had to determine whether the alleged act of bankruptcy indeed occurred and if so, whether it was sufficient to warrant a sequestration order. Additionally, the court had to consider the costs to be borne by the debtor and the appointment of a trustee.

The court examined the evidence provided by Britt regarding the act of bankruptcy. It found that the evidence was sufficient to establish that an act of bankruptcy had indeed occurred on the date claimed. The court was satisfied that the act of bankruptcy met the legal criteria required for a sequestration order. Regarding the costs, the court ruled that they were to be taxed and paid from Wong's estate in accordance with the Bankruptcy Act 1966. The court also confirmed the appointment of Phillip Kenneth Aggs as trustee and directed that the sequestration order be entered and a copy provided to the Official Receiver in Sydney.

In summary, the court found in favour of Britt and ordered that a sequestration order be made against Wong's estate. The court also directed that Britt's costs be paid from Wong's estate. Furthermore, the court confirmed the appointment of Phillip Kenneth Aggs as trustee and directed that the sequestration order be entered and a copy provided to the Official Receiver in Sydney within the specified timeframe.

Orders

Orders of the court

A sequestration order be made against the estate of Andrew Wong.

The applicant creditor’s costs, including all reserved costs, be taxed and paid from the estate of the respondent debtor in accordance with the Bankruptcy Act 1966.

Note that the petitioner alleges that the date of the act of bankruptcy is 14 March 2006.

Note that a consent to act as trustee has been signed by Phillip Kenneth Aggs and will be lodged with the Official Receiver in Sydney within

2 days.

The applicant must within 2 days obtain an entered sequestration order and give a copy the Official Receiver in Sydney.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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