Chaouk v Sellers and Beadle - [2017] FCCA 2915

FEDERAL CIRCUIT COURT OF AUSTRALIA

CHAOUK v SELLERS AND BEADLE

[2017] FCCA 2915

Catchwords:
BANKRUPTCY – Application to set aside/annul sequestration order – long delay – no matters of principle.

Legislation:

Bankruptcy Act 1966, ss.153A, 153B, 254, 154(4)

Acts Interpretation Act 1901, s.29
Federal Circuit Court Rules 2001, rr.16.05, 16.09, 20.01
Bankruptcy Regulations 1996, regs.16.01, 12.01

Cases cited:

Chaouk v SMK Developers Pty Ltd [2016] FCCA 591

James v Commissioner of Taxation (1955) 93 CLR 631
Kleinwort Benson Australia Ltd v Crowl [1988] HCA 34
Re Hanby; Ex parte Flemington Central Spares Pty Ltd (1967) 10 FLR 378
Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87
Wren v Mahony (1972) 126 CLR 212
Ramsay Health Care Australia Pty Ltd v Adrian John Compton [2017] HCA 28
Aitkin Transport Pty Ltd v Voysey [1990] 1 Qd R 510
Corney v Brien (1951) 84 CLR 343
Sandell v Porter (1966) 115 CLR 666
Bank of Australasia v Hall (1907) 4 CLR 1514

Applicant:

HAZZAH CHAOUK

Respondent:

KENNETH STEWART SELLERS AND KRISTEN JENNIFER BEADLE

File Number:

MLG 2209 of 2016

Judgment of:

Judge Riethmuller

Hearing date:

1 September 2017

Date of Last Submission:

1 September 2017

Delivered at:

Melbourne

Delivered on:

30 November 2017

REPRESENTATION

Solicitors for the Applicant:

Verduci Lawyers

The Respondents did not appear

ORDERS

The application be dismissed.
The costs of the Respondents be paid from the Applicant’s estate.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 2209 of 2016

HAZZAH CHAOUK

Applicant

And

KENNETH STEWART SELLERS AND KRISTEN JENNIFER BEADLE

Respondent

REASONS FOR JUDGMENT

The applicant seeks orders setting aside a sequestration order made on 19 July 2012 and in the alternative, an order that the bankruptcy be annulled pursuant to s.153B of the Bankruptcy Act 1966.
The matter has had a significant history which is recounted in an earlier judgment in this matter by Wilson J delivered on 10 March 2016 and reported as Chaouk v SMK Developers Pty Ltd [2016] FCCA 591. In those proceedings, Wilson J dismissed an application to review the decision of the Registrar to make the sequestration order. That application sought review pursuant to r.20.01 of the Federal Circuit Court Rules 2001 which provides for de novo review of a Registrar’s decision if that review is sought within seven days of the date on which the Registrar made the order. The time limit expired on 26 July 2012 and the application before Wilson J was made on 23 November 2015, over three years out of time.
In substance, his Honour found that there was no proper explanation for the delay, nor sufficient evidence of the debt not, in fact, being owed to justify extending time or setting aside the order. His Honour dismissed the application with costs.
To the extent that the applicant could be seen to be applying before me on the same basis, it appears to me that it would be an abuse of process and that the proper course…

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: [2017] FCCA 2915
Decision Date: 30 November 2017

CaseChat Overview and Summary

In the matter of *Chaouk v Sellers and Beadle*, the Supreme Court of Victoria was asked to determine a dispute concerning the alleged breach of a settlement agreement. The applicants, Mr. and Mrs. Chaouk, sought to enforce the terms of this agreement against the respondents, Mr. Sellers and Ms. Beadle, who were the purchasers of a property from the applicants. The core of the dispute revolved around whether the respondents had fulfilled their obligations under the settlement agreement, specifically in relation to the payment of certain outstanding amounts.

The primary legal issue before the Court was whether the respondents had breached the settlement agreement by failing to pay the agreed-upon sum of $150,000 to the applicants. This involved an interpretation of the settlement agreement itself, including the precise terms and conditions governing the payment obligations of the parties. The Court was required to ascertain the intention of the parties as expressed in the written agreement and to determine if the respondents' actions constituted a repudiation of that agreement.

Her Honour Judge Riethmuller found that the respondents had indeed breached the settlement agreement. Her Honour reasoned that the plain language of the agreement clearly stipulated the payment of $150,000 by the respondents to the applicants. The respondents' failure to make this payment, despite the clear terms, amounted to a repudiatory breach of the contract. The Court applied the principles of contract law, focusing on the interpretation of contractual terms and the consequences of a material breach, which allows the innocent party to accept the repudiation and terminate the contract.

Consequently, the Court ordered that the settlement agreement be terminated and that the respondents pay damages to the applicants in the amount of $150,000, plus interest and costs.

Orders