Byczko v Sheahan

[2001] FMCA 120

FEDERAL MAGISTRATES COURT OF AUSTRALIA

BYCZKO v SHEAHAN  [2001] FMCA 120

BANKRUPTCY – Application for annulment under s 153B – no evidence that petition ought not to have been presented or accepted – exercise of discretion not to grant annulment where affairs are complex and claims on the estate involved – application refused.

Bankruptcy Act1966 (Cth) ss 153 A, 153B,

Cachia v Hanes (1994) 120 ALR 385

McDonald, Henry and Meek, Australian Bankruptcy Law and Practice.

Applicant: JAN CZESLAW BYCZKO

Respondent: JOHN SHEAHAN

File No:   AZ 243 of 2001

Delivered on: 4 December 2001

Delivered at: Adelaide

Hearing Date: 4 December 2001

Judgment of: Raphael FM

REPRESENTATION

For the Applicant: Mr J Byczko

For the Respondent: Mr D Partington

Mr Sheahan

ORDERS

1. Application dismissed.

2. Costs of the Child Support Agency to be paid out of the estate of the bankrupt.

FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE

AZ 243 of 2001

JAN CZESLAW BYCZKO

Applicant

And

JOHN SHEAHAN

Respondent

REASONS FOR JUDGMENT

1. In this matter the bankrupt, JAN CZESLAW BYCZKO, makes an application under section 153B of the Bankruptcy Act1966 for the annulment of his bankruptcy.

2. Mr Byczko was made bankrupt on 12 March 2001 on his own petition. Section 153B is in the following form:

   If the court is satisfied that a sequestration order ought not to have been made or, in the case of a debtor's petition, that the petition ought not to have been presented or ought not have been accepted by the official receiver, the court may make an order annulling the bankruptcy. 

3. Mr Byczko has filed an affidavit to which he has annexed a considerable volume of documentation and has spoken on his own behalf at some considerable length.  It should be stated that this matter was originally set down for hearing on 10 December, but the court requested that the matter be heard today, 4 December, as this was the date upon which I was circuiting to Adelaide and hearing bankruptcy matters.  Mr Byczko agreed to that course of action, although he now says that if he had been given until 10 December some further evidence would have been filed.

4. The argument put by Mr Byczko in support of his application appears to revolve around his solvency at the time that the petition was presented.  Mr Byczko is the owner of at least two properties – one in Croydon Park and one in Plympton – and he states that had those properties been sold he could have paid off all his creditors.  That is probably correct; the only problem is that at the time Mr Byczko placed himself into bankruptcy he had taken part in a number of transactions relating to those properties which effectively put those properties out of his control. 

5. The details of those transactions are contained in the affidavit of Ian Russell Lock sworn on 14 November 2001 and filed in these proceedings.  Eventually the trustee had those transactions set aside in the Federal Court.  The setting aside orders…