Cahill v Garrett

[2015] FCCA 1627

FEDERAL CIRCUIT COURT OF AUSTRALIA

CAHILL & ORS v GARRETT [2015] FCCA 1627

Catchwords:
BANKRUPTCY – Sequestration order – application granted.

Legislation:

Taxation Administration Act 1953 (Cth)
Judiciary Act 1903 (Cth), s.39B
Freedom of Information Act 1989 (Cth)

First Applicant: FRANCIS MICHAEL CAHILL

Second Applicant:

Supporting Creditor:

Respondent:

DEPUTY COMMISSIONER OF TAXATION

AUSTRADE

ANDREW MORTON GARRETT

File Number: MLG 177 of 2015

Judgment of: Judge Riethmuller

Hearing date: 15 May 2015

Date of Last Submission: 15 May 2015

Delivered at: Melbourne

Delivered on: 15 May 2015

REPRESENTATION

Solicitors for the First Applicant: Mr Cahill

Solicitors for the Second Applicant:

Solicitors for the Supporting Creditor:

Counsel for the Respondent:

Mr Tavolaro

Mr Abrams

In Person

ORDERS

1. The Deputy Commissioner of Taxation be added as the Second Applicant to the proceeding.

2. A sequestration order be made against the estate of ANDREW MORTON GARRETT.

3. The applicant creditors’ costs be taxed and paid from the estate of the respondent debtor in accordance with the Bankruptcy Act 1966.

THE COURT NOTES THAT:

A.The date of the act of bankruptcy is 19 January 2015.

B.A declaration of Consent to Act as Trustee has been provided by Mr Timothy Mark Shuttleworth Holden, signed and dated 27 January 2015.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 177 of 2015

FRANCIS MICHAEL CAHILL

First Applicant

DEPUTY COMMISSIONER OF TAXATION

Second Applicant

AUSTRADE

Supporting Creditor

And

ANDREW MORTON GARRETT

Respondent

REASONS FOR JUDGMENT

(as revised from transcript)

1. This is an application for a sequestration order.  The creditors that have appeared in the application are three in number. 

2. The first creditor is Mr Cahill, who was formerly a solicitor of the debtor, and has been involved in much litigation with him since that time.  At present, Mr Cahill has costs orders against Mr Garrett, and one in particular for the sum of $8586.50, made on 26 May 2014 in the Supreme Court of Victoria, in proceedings SCI 02968 of 2013.  That costs order founded a bankruptcy notice which was issued on 10 June 2014.  That bankruptcy notice was served upon the respondent debtor, and it was not complied with. 

3. The bankruptcy notice was the subject of proceedings before Judge Burchardt, and then on appeal to the Federal Court of Australia, where the debtor seeking to have the bankruptcy notice set aside.  The bankruptcy notice was not set aside and the appeal was dismissed.  The case is, therefore, one where the debtor has committed an act of bankruptcy in failing to pay the amount set out in the bankruptcy notice.  The creditors put forward evidence, not only of the debt to Mr Cahill, but also of substantial debts to the Australian ATO (‘ATO’).

4. The debts to the ATO are set out in an affidavit of Mr Pownell filed in these proceedings and total $8,288,930.31.  They consist of a variety of forms of debt, ranging from judgments in the courts through to running account balances. 

5. The third creditor that appeared is Austrade, who have a judgment for costs, but have not…