Cervantes Pty Ltd v Moutidis

FEDERAL MAGISTRATES COURT OF AUSTRALIA

CERVANTES PTY LTD v MOUTIDIS [2004] FMCA 1023

BANKRUPTCY – Personal insolvency agreement – whether creditors petition should be stayed pursuant to s.189AAA of the Bankruptcy Act 1966 (the Act) – whether valid authority pursuant to s.188 of the Act – authority declared void – failure to specify authorised person – not an irregularity for purpose of s.306 of the Act – fundamental requirement that debtor nominates the authorised person.

Bankruptcy Act 1966, ss.188, 189AAA, 306

Applicant: CERVANTES PTY LTD

Respondent: ELIAS MOUTIDIS

File No: MLG 1122 of 2004

Delivered on: 14 December 2004

Delivered at: Melbourne

Hearing Date: 14 December 2004

Ruling of: McInnis FM

REPRESENTATION

Counsel for the Applicant: Mr M. Sanger

Solicitors for the Applicant: Daly & Kernahan

Counsel for the Respondent: Mr F.J. Maiden

Solicitors for the Respondent: Denis P O’Haire

Counsel for Supporting Creditor: Mr D. Gillard

Solicitors for Supporting Creditor: Property & Business Lawyers

ORDERS

IT IS DECLARED that the form signed by the Debtor on 13 December 2003 entitled “Controlling Trustee Authority and Trustee Declaration” is void and of no effect.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLG 1122 of 2004

CERVANTES PTY LTD

Applicant

and

ELIAS MOUTIDIS

Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

1. In this application a creditor's petition was filed on 30 August 2004.  The matter has been the subject of procedural orders made by the court on 22 November 2004.  The orders that were made on 22 November included an order that the application be adjourned and that the parties file and serve supporting material.

2. In the matter that came before the court this day, counsel for the debtor brought to the court's attention a document entitled Controlling Trustee Authority and Trustee Declaration (the authority) which purports to be an authority signed by the debtor pursuant to s.188 of the Bankruptcy Act 1966 (the Act).

3. It is clear that the completion of that form by a debtor is a process whereby the debtor signs an authority in accordance with the approved form naming and authorising a registered trustee, a solicitor or the official trustee to call a meeting of the debtor's creditors and to take control of the debtor's property. So much is evident from s.188 which provides:

   (1)A debtor who desires that his or her affairs be dealt with under this Part without his or her estate being sequestrated and:

   (a) is personally present or ordinarily resident in Australia;

   (b) has a dwelling-house or place of business in Australia;

   (c)is carrying on business in Australia, either personally or by means of an agent or manager; or

   (d) is a member of a firm or partnership carrying on business in Australia by means of a partner or partners or of an agent or manager;

   may sign an authority in accordance with the approved form naming and authorising a registered trustee, a solicitor or the Official Trustee to call a meeting of the debtor's creditors and to take control of the debtor's property.