Byrne v Agripay Pty Ltd
[2009] FMCA 760
•16 July 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| BYRNE v AGRIPAY PTY LTD | [2009] FMCA 760 |
| BANKRUPTCY – Administrator’s application for sequestration order of deceased’s estate – whether application should be adjourned so that creditor’s debt can be quantified. |
| Bankruptcy Act1966, s.247 Uniform Civil Procedure Rules, r.292 |
| Applicant: | JOAN ELIZABETH BYRNE |
| Respondent: | AGRIPAY PTY LTD |
| File Number: | BRG 452 of 2009 |
| Judgment of: | FM Wilson |
| Hearing date: | 16 July 2009 |
| Date of Last Submission: | 16 July 2009 |
| Delivered at: | Brisbane |
| Delivered on: | 16 July 2009 |
REPRESENTATION
| Counsel for the Applicant: | Mr Grimshaw |
| Solicitors for the Applicant: | Shannon Donaldson Province Lawyers |
| Counsel for the Creditor: | N/A |
| Solicitors for the Creditor: | Flower & Hart |
ORDERS
That the hearing of the administrator’s petition be adjourned to 9:30am 7 August 2009 in the Federal Magistrates Court in Brisbane.
That both parties’ costs are reserved to 7 August 2009.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
BRG 452 of 2009
| JOAN ELIZABETH BYRNE |
Applicant
And
| AGRIPAY PTY LIMITED |
Respondent
REASONS FOR JUDGMENT
The applicant seeks an order under s.247 Bankruptcy Act1966 (“the Act”) placing the estate of Murray Andrew Byrne into administration. The applicant is the administrator of the estate. I am satisfied from the documents relied upon by the applicant that the prerequisites specified in s.247 of the Act are established: the estate is plainly insolvent.
Before the Court a supporting creditor, AgriPay Pty Limited, appears and seeks an adjournment of the application to enable its proceedings against the estate in the Supreme Court to be potentially finalised, on an application by it for summary judgment. To put that into context it appears from the Statement of Affairs filed in support of the application under s.247 that a debt is claimed by AgriPay Pty Limited against the deceased.
In the Statement of Affairs that debt is disputed. I am told that AgriPay Pty Limited has brought Supreme Court proceedings against the deceased. I am told that in those proceedings there has been a defence and counterclaim filed on behalf of the deceased. As I have said AgriPay Pty Limited has applied for summary judgment pursuant to rule 292 Uniform Civil Procedure Rules. I am told that that application is initially returnable tomorrow, 17 July, although there is currently a dispute between the parties as to whether that application has been filed and served in compliance with the Uniform Civil Procedure Rules.
Ultimately the question for me is whether or not an order should be made today placing the estate into administration or whether the present application should be adjourned to enable the proceedings brought by AgriPay Pty Limited in the Supreme Court to at least continue to the stage of the determination of the summary judgment application.
The prejudice to the estate in allowing an adjournment is that further costs will be incurred if the estate chooses to defend the summary judgment application. That is by no means certain given what Mr Grimshaw has said today about the present solvency of the estate.
The advantage in the course proposed by the supporting creditor is that it will potentially remove from the bankruptcy administration a dispute. If the estate proceeds into administration now the debt of AgriPay Pty Limited is disputed and the trustee will have to resolve that dispute if the estate continues to maintain its objection. That has the potential to lead to further litigation in terms of a challenge to the trustee's decision.
Of course summary judgment is not easily obtained and the creditor’s application may not succeed. However, in my view, the interests of justice weigh in favour of allowing the Supreme Court application to at least proceed to a hearing, so that as I have said a potential source of dispute between the parties can be resolved one way or the other.
There then remains the question as to the period of any adjournment. As I have said the parties are currently in dispute as to whether the application for summary judgment was properly served. It seems to me that if what the applicant administrator says is right the likely result is that the application for summary judgment will be adjourned to enable the time provided for under the Rules to elapse. It is likely that the application will be heard and determined within the next 14 days. If I adjourn the present application for that period no prejudice has been pointed to other than the incurring of legal costs, if as I have said the estate proposes to oppose the application for summary judgment.
I certify that the preceding eight (8) paragraphs are a true copy of the reasons for judgment of Wilson FM
Associate: Lynnette Chin
Date: 7 August 2009
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