Carver, P.G.S. v Joyce, B.M

[1990] FCA 793

Re: PETER GEORGE STAR CARVER
And: BRIAN MAXWELL JOYCE and DOUGLAS MAXWELL LANE
No. N G696 of 1990
FED No. 793
Practice and Procedure - Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Lockhart J.(1)

CATCHWORDS

Practice and Procedure - Bankruptcy - Stay - Appeal - Application for stay of sequestration order pending appeal - Time limit of 21 days provided under Bankruptcy Act for maximum length of stay - Power under Federal Court Rules - Whether Court bound by time limit under Bankruptcy Act.

Bankruptcy - Stay - Appeal - Application for stay of sequestration order pending appeal - Time limit of 21 days provided under Bankruptcy Act for maximum length of stay - power under Federal Court Rules - Whether Court bound by time limit under Bankruptcy Act.

Bankruptcy Act 1966: s. 37(1), (2); s. 52(3)

Federal Court Rules: Order 52 rule 17

HEARING

SYDNEY

#DATE 12:12:1990

Counsel for the Applicant: Mr P. Strasser

Solicitors for the Applicant: Star Carver and Co.

Counsel for B.M. Joyce: Miss Sally Nash

Solicitors for B.M. Joyce: Denley, Gargett and Baird

Counsel for Official Receiver: Mr G.L. Caddy

Solicitors for Official Receiver: Australian Government Solicitor

ORDER

1. The motion be dismissed.

2. The applicant pay the costs of the respondents.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This is a motion by Peter George Star Carver seeking a stay of the execution of the sequestration order made against his estate by another Judge of this Court on 13 November 1990, pending the determination of an appeal lodged by the applicant to the Full Court of this Court. That appeal is from a judgment of another Judge of this Court of 3 December 1990.

1. The order of events is of some importance and should be stated. As I said earlier, it was on 13 November 1990 that the sequestration order was made against the estate of the applicant. On 20 November 1990 a Judge of this Court "stayed the sequestration order" until 4 December 1990. I note that 4 December 1990 is the expiration of 21 days from the making of the sequestration order, so I assume that the order made by his Honour on 20 November 1990 was under s. 52(3) of the Bankruptcy Act 1966.

2. On 3 December 1990 the same Judge dismissed the application of the applicant for an order to set aside the sequestration order. On 7 December 1990 the applicant filed a notice of appeal from the order of his Honour of 3 December 1990 dismissing his application to set aside the sequestration order and at the same time filed a notice of motion for an order that the execution of the sequestration order be stayed pending the outcome of the appeal to which I have already referred.

3. This morning counsel for the applicant seeks the order as set out in paragraph 1 of the notice of motion, and the making of it is opposed by the petitioning creditor. Mr Caddy appears for the Official Receiver, but makes no submissions in relation to the matter.

4. Section 37(1) of the Bankruptcy Act 1966 empowers the Court to rescind, vary or discharge an order by it under the Act or to suspend the operation of such an order. The Court is prohibited by s. 37(2), however, from rescinding or suspending the operation of a sequestration order after it has been signed and sealed as provided by the bankruptcy rules. It is common ground that the sequestration order has not yet been signed and sealed as provided by the rules.

5. Section 52(3) of the Bankruptcy Act 1966 is a particular provision relating to the stay of proceedings and consequent upon the making of a sequestration order, it provides that the Court may, if it thinks fit:
   

"upon such terms and conditions as it thinks proper, stay all proceedings under a sequestration order for a period not exceeding 21 days."

1. That stay was granted by Mr Justice Hill and operative until 4 December 1990. In my opinion, the power of the Court to stay proceedings under a sequestration order (leaving aside for the moment the question of its appellate jurisdiction to which I shall return) is a power that is limited by s. 52(3) i.e. is confined to the power of which the source is s. 52(3). I do not regard s. 37(1) as a power which can operate over and beyond the power conferred by s. 52(3), although I note that the Court's power under s. 37(1) is not expressed in the same language as the power under s. 52(3).

2. My view is reinforced by consideration of other sections of the Bankruptcy Act 1966, in particular s. 43(2) and s. 58(1). It follows that, subject to the Court's appellate jurisdiction, the power to stay proceedings under the sequestration order has already been exercised and cannot be further exercised. The Court has power in its appellate jurisdiction under order 52 rule 17 to grant a stay of execution or of proceedings under a judgment appealed from.

3. Mr Justice Pincus considered the interaction of order 52 rule 17 and s. 52(3) of the Bankruptcy Act in Evans v Heather Thiedeke Group Pty Limited (1990) 95 ALR 424, and his Honour held at 425 that:
   

"the general power to grant a stay (not limited to a

stay pending appeal) given by s. 52(3) does not nullify the court's jurisdiction to order a stay under order 52 rule 17."

1. That was a case very different to the present. In that case a sequestration order was made on the 4 May 1990 against the applicant but the presiding Judge stayed the proceedings until 25 May 1990, 21 days thereafter, to enable consideration of an appeal. The applicant decided to appeal and then sought a further stay of the sequestration order until the appeal could be heard. Mr Justice Pincus granted that further stay pursuant to the powers conferred by order 52 rule 17.

2. In the present case there has been no appeal lodged against the making of a sequestration order of the 13 November 1990 so that the position is entirely different from that which arose in Evans v Heather Thiedeke. I am of the view that there is no power to grant the order sought in the notice of motion. I have, however, considered the evidence and even if I had the requisite power, I am not persuaded on the evidence that it would be an appropriate case on which to exercise my discretion in favour of making the order sought in the notice of motion.

3. Accordingly the notice of motion is dismissed.

4. I order the applicant to pay the costs of the respondent petitioning creditor of the motion.