Cadence (90) Investments Pty Ltd v Chalmers, in the matter of Chalmers

In *Cadence (90) Investments Pty Ltd v Chalmers, in the matter of Chalmers*, heard in the Federal Court of Australia, Cadence (90) Investments Pty Ltd sought a sequestration order against Mr. S. D. Chalmers based on an alleged act of bankruptcy. The act of bankruptcy relied upon was Mr. Chalmers' failure to comply with a bankruptcy notice that had been served on him outside of Australia.

The central legal issue before the Court was whether the jurisdictional requirements for making a sequestration order under section 43(1) of the *Bankruptcy Act 1966* (Cth) were met. Specifically, the Court had to determine if, at the time of the alleged act of bankruptcy (5 March 2020), Mr. Chalmers had a dwelling-house in Australia, was ordinarily resident in Australia, or was carrying on business in Australia.

The Court dismissed the creditor's petition. Judge Manousaridis found that the evidence did not establish that Mr. Chalmers had a dwelling-house in Australia, was ordinarily resident in Australia, or was carrying on business in Australia as at 5 March 2020. Mr. Chalmers had been residing in Los Angeles with his partner since 2016 under a lease, did not own residential property in Australia, and while he had previously been an officer of and operated businesses in Australia, the evidence indicated that these companies had either ceased trading, were in liquidation, or he had resigned as an officer prior to the relevant date. The Court concluded that the jurisdictional requirements for making a sequestration order were not satisfied.