Capital Finance Australia Ltd v Szita
[2005] FMCA 1938
•20 December 2005
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CAPITAL FINANCE AUSTRALIA LTD v SZITA | [2005] FMCA 1938 |
| BANKRUPTCY – Opposition to a Sequestration Order – where the applicant appeared via telephone and refused to admit his identity – whether the alleged debt has been discharged by a promissory note – where the promissory note is not found to be a valid document – where the applicant claims that the original proceedings have been appealed but there is no evidence that this is so – whether there is a cross-claim in excess of the original debt – where no particulars of the alleged cross-claim are provided by the applicant. |
| Bankruptcy Act, s.52 Szita v Capital Finance Australia Limited [2004] FCA 477 |
| Applicant: | CAPITAL FINANCE AUSTRALIA LTD |
| Respondent: | MICHAEL JOHN SZITA |
| File Number: | SYG 2813 of 2005 |
| Judgment of: | Raphael FM |
| Hearing date: | 20 December 2005 |
| Date of Last Submission: | 20 December 2005 |
| Delivered at: | Sydney |
| Delivered on: | 20 December 2005 |
REPRESENTATION
| Counsel for the Applicant: | Mr Hyde |
| Solicitors for the Applicant: | Cridlands Lawyers |
ORDERS
Sequestration Orders against the estate of Michael John Szita be made.
The Applicant Creditor’s costs (including any reserved costs) be taxed and paid from the estate of the respondent debtor in accordance with the Act.
Under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Received in Sydney within 2 days.
The Court notes the date of act of bankruptcy is 9 September 2005.
I note that a consent to act as a trustee has been signed by Kenneth S Sellers of Sims Partners of Level 2, 446 Collins Street, Melbourne, Victoria and has been lodged with the Official Receiver in Sydney.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2813 of 2005
| CAPITAL FINANCE AUSTRALIA LTD |
Applicant
And
| MICHAEL JOHN SZITA |
Respondent
REASONS FOR JUDGMENT
These proceedings seek a sequestration order against the estate of Michael John Szita. Mr Szita filed with the court a notice of opposition. He raised three grounds of opposition. (1) The alleged debt has been discharged via a negotiable instrument in 2004. (2) The original matter is to be appealed on the grounds North J erred in his decision. (3) There is a cross-claim that is in excess of the alleged debt. When the matter came on for hearing before me today Mr Szita was contacted at the telephone. A person answered the telephone. He declined to accept that he was Mr Szita, he advised the court that he was a person who wished to represent Mr Szita, the court informed him that it was not prepared to grant any leave to represent Mr Szita unless that person was a legal practitioner. The court requested that Mr Szita come to the phone, the person at the telephone made remarks to the effect that Mr Szita was a "straw man". The court informed the person at the telephone that unless an acceptance was given that the court was talking to Mr Szita the conversation would conclude and the application would proceed in the absence of Mr Szita. The person at the end of the telephone did not confirm that he was Mr Szita and those steps were then taken.
The promissory note referred to by the applicant in his notice of opposition is dealt with by the applicant in an affidavit filed on 2 December 2005, having been sworn on that date. That contains a certified promissory note dated 8 November 2004 with the words "copy only" written over it. This document was served upon the creditor in late February 2005 and was responded to by letter on 8 March 2005 by way of a letter from the creditor's lawyers stating that their client did not accept the document was valid nor that it discharged his debt to their client. This second promissory note seems to have all the vices of the an earlier note considered by North J I do not consider it a valid document nor as representing a ground of opposition to the application.
In regard to the grounds of opposition to the petition I am satisfied that a decision has already been made in relation to the first promissory note by a Deputy President of the Victorian Civil and Administrative Tribunal and that this fact was referred to and agreed with by his Honour North J in certain proceedings between Mr Szita and the applicant numbered V860 of 2003 in a judgment Szita v Capital Finance Australia Limited [2004] FCA 477 at [15-16]. The fact that the “original matter” is to be appealed is not a bar to a sequestration order being made. It is not clear what "the original matter" is. Is it the V-CAT decision or is it North Js decision? But I am informed by Mr Hyde who appears for the applicant and by an affidavit of Cherrie Homer of 30 September 2005 that no appeal has been made. The facts that a cross-claim is asserted is not sufficient to permit the court to set aside an application for a sequestration order. No particulars of the alleged cross-claim are provided by the applicant. None of the matters raised in the notice of intention to oppose the application would prevent the sequestration order from being made.
I am satisfied that the debtor committed the act of bankruptcy alleged in the petition. I am satisfied of the proof of the other matters required by s.52 of the Bankruptcy Act. I make a sequestration order against the estate of Michael John Szita. I order that the applicant pay the creditor's costs, including any reserved costs be taxed in accordance with the Federal Court Act and Rules and paid from the estate of the respondent debtor in accordance with the Act. Under the Bankruptcy Regulations a copy of the sequestration order must be given to the Official Receiver in Sydney within two days.
The court notes the date of act of bankruptcy is 9 September 2005. The court notes that a consent to act as trustee has been signed by Kenneth S. Sellers of Sims Partners, Level 2, 446 Collins Street, Melbourne, Victoria and appoints Mr Sellers as trustee of the bankrupt estate of Mr Szita.
I certify that the preceding five (5) paragraphs are a true copy of the reasons for judgment of Raphael FM
Associate:
Date:
0