Carrafa v Gomez & Anor (No.3) - [2016] FCCA 3139

FEDERAL CIRCUIT COURT OF AUSTRALIA

CARRAFA v GOMEZ & ANOR (No.3)

[2016] FCCA 3139

Catchwords:
BANKRUPTCY – Application under s.120 and s.121 of the Bankruptcy Act 1966 – defence of equity of exoneration.

Legislation:
Bankruptcy Act 1966, ss.120, 121
Duties Act 2000 (Vic) s.43(3)

Cases cited:
Farrugia v Official Receiver in Bankruptcy (1982) 58 FLR 474; [1982] FCA 52
Ierino v Gutta (2012) 43 WAR 372; [2012] WASCA 222
Paget v Paget [1898] 1 Ch 470
Parsons v McBain (2001) 109 FCR 120; (2001) 192 ALR 772; (2001) 1 ABC(NS) 188; [2001] FCA 376

Applicant:

MICHAEL CARRAFA AS TRUSTEE IN BANKRUPTCY FOR THE BANKRUPT ESTATE OF KALAISELVI GOMEZ

First Respondent:

IRWIN GOMEZ

Second Respondent:

JNGO PTY LTD (CAN 168 239 781)

File number:

MLG 2624 of 2014

Judgment of:

Judge Riley

Hearing date:

14 June 2016 and 11, 12 and 20 July 2016

Date of last submission:

2 August 2016

Delivered at:

Melbourne

Delivered on:

7 December 2016

REPRESENTATION

Counsel for the applicant:

Tim Sowden

Solicitors for the applicant:

Zervos Lawyers

Advocate for the first respondent:

Kristen Moore, until Kennedy Guy was given leave to file a notice of ceasing to act on 14 June 2016, and then there being no appearance

Solicitors for the first respondent:

Kennedy Guy, until it was given leave to file a notice of ceasing to act, and then there being no solicitor on the record

Advocate for the second respondent:

No appearance on 14 June 2016 and then Nathan Gomez by leave of the court

Solicitors for the second respondent:

None

DECLARATIONS

The transfer of the bankrupt’s interest in the property situated at 59 Hinrichsen Drive, Hallam in the State of Victoria (certificate of title volume 09970 folio 306), to the first respondent registered on or about 23 May 2014, is void pursuant to s.120 of the Bankruptcy Act 1966.
The transfer of the bankrupt’s interest in the property situated at 2 Hatherley Grove, Altona North in the State of Victoria (certificate of title volume 05218 folio 573), to the first respondent registered on or about 23 May 2014, is void pursuant to s.120 of the Bankruptcy Act 1966.
The transfer of $171,100 from the bankrupt’s Commonwealth Bank of Australia (ACN 123 123 124) bank account no. 10821202 on 27 February 2014 to JNGO Pty Ltd (“JNGO”) is void against the applicant, pursuant to s.120 the Bankruptcy Act 1966.
The funds held in Rabobank (ACN 001 621 129) (“Rabobank”) bank account no. 142-201-3587482-21 in the name of JNGO with a current balance of $123,139.01 are the property of the bankrupt.

ORDER

Rabobank pay the sum of $123,139.01, held in its bank account no 142-201-3587482-21 in the name of JNGO, to the applicant.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 2624 of 2014

MICHAEL CARRAFA AS TRUSTEE IN BANKRUPTCY FOR THE BANKRUPT ESTATE OF KALAISELVI GOMEZ

Applicant

And

IRWIN GOMEZ

First respondent

And

JNGO PTY LTD (ACN 168 239 781)

Second respondent

REASONS FOR JUDGMENT

Introduction

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2016] FCCA 3139
Decision Date: 7 December 2016

CaseChat Overview and Summary

In *Carrafa v Gomez & Anor (No.3)*, Riley J of the Supreme Court of New South Wales considered a dispute concerning the proper construction of a deed of settlement and the enforceability of certain clauses within it. The applicant, Mr Carrafa, sought to enforce the terms of the deed against the respondents, Mr and Mrs Gomez, who had entered into the settlement agreement with him.

The central legal issues before the Court were whether the respondents were estopped from denying the validity of the deed, and whether certain provisions of the deed, specifically those relating to the release of claims and the payment of a sum of money, were enforceable. The Court also had to determine the consequences of the respondents' alleged repudiation of the deed.

Riley J's reasoning focused on the principles of estoppel and contract law. His Honour found that the respondents, by their conduct and representations, were estopped from denying the validity of the deed. The Court applied the principles of contractual interpretation to the deed, concluding that the terms were clear and unambiguous. His Honour also considered the doctrine of repudiation and its effect on the enforceability of contractual obligations.

The Court made orders that the respondents were estopped from denying the validity of the deed of settlement. The respondents were ordered to pay the sum of $150,000 to the applicant, together with interest and costs.

Orders