Corry v Skobla
[2011] QCATA 107
•9 May 2011
| CITATION: | Corry v Skobla [2011] QCATA 107 |
| PARTIES: | Mr Nicholas Corry (Applicant/Appellant) |
| v | |
| Mr Jason Clint Skobla (Respondent) |
| APPLICATION NUMBER: | APL018-11 |
| MATTER TYPE: | Appeals |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Richard Oliver, Senior Member |
| DELIVERED ON: | 9 May 2011 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | Leave to appeal refused. |
| CATCHWORDS: | Minor Civil Dispute – decision by default – whether regularly entered – whether respondent had standing to bring minor civil dispute claim because he is an undischarged bankrupt – where cause of action arose after bankruptcy Queensland Civil and Administrative Tribunal Act 2009, ss 51, 142(3) Bankruptcy Act 1966, ss 116, 129(4)(a) QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard on the papers, pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).
REASONS FOR DECISION
On 15 March 2010 Mr Skobla filed an application for minor civil dispute – minor debt in the Caboolture Magistrates Court. He claimed that Mr Corry owed him $24,987.50 being monies loaned by Mr Skobla to Mr Corry between 17 February 2008 and 30 July 2008. Particulars of the loans are annexed to his application.
The total amount of money leant to Mr Corry, according to the application, was $29,700.00 but $5,000.00 of that has been repaid leaving the balance as claimed.
No response was filed to the application and on 30 July 2010 a decision by default was made resulting in a decision that Mr Corry pay to Mr Skobla the sum of $24,987.50, which included $287.50 for filing fees and costs.
On 17 September 2010 Mr Corry’s solicitor wrote to the Magistrates Court at Caboolture advising that he was acting in the matter and that he be notified of any enforcement proceedings.
Rather than apply to the Magistrates Court at Caboolture (exercising jurisdiction under the QCAT Act) to set aside the default decision, an application for leave to appeal and appeal was filed in the Tribunal on 4 February 2011. The grounds of appeal are three: firstly, it is contended that the applicant is not a party to the dispute; secondly, Mr Corry was never served with the application; and thirdly, there are grounds for setting aside the decision by default. The grounds are supplemented by extensive written submissions prepared by Mr Corry’s solicitor and counsel.
The Tribunal has power to set aside the decision by default[1] on terms, including costs. Here, Mr Corry has sought to raise arguments in his application for leave to appeal that one might usually expect to see on an application to set aside a default decision rather than on an application for leave to appeal.
[1] QCAT Act, s 51.
If the decision by default is regularly entered, in that all procedural requirements had been satisfied, it would be difficult to identify any error on the part of the original decision maker, as that is the only basis upon which leave to appeal could be granted. As this is an appeal from a minor civil dispute matter, leave to appeal is necessary.[2] To obtain leave to appeal the applicant must establish that there is a reasonably arguable case of error in the primary decision,[3] there is a reasonable prospect that the applicant will obtain substantive relief,[4] or leave is necessary to correct a substantial injustice to the applicant caused by some error[5].
[2] QCAT Act, s 142(3).
[3] QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41.
[4] Cachia v Grech [2009] NSWCA 232 at [13].
[5] QUYD Pty Ltd v Marvass Pty Ltd (supra).
Therefore, the only ground upon which this appeal can succeed is if the default decision was irregularly entered, if not, then the appropriate course is to apply to set the decision aside. The applicant contends that as Mr Skobla was made bankrupt on 7 December 2007 he has no standing to pursue a claim in debt for the loan transactions which occurred after the date of his bankruptcy. The applicant contends that the benefit of the loans, being a chose in action, vested in Mr Skobla’s Trustee in Bankruptcy upon his bankruptcy and it is only the Trustee that can bring the proceeding.
The applicant relies on Stone v Ace-IRM Insurance Broking Pty Ltd.[6] Ms Stone commenced a proceeding in relation to a cause of action in negligence for personal injury as a result of an incident that occurred before she was made bankrupt. The Court agreed that the cause of action vested in her Trustee because it accrued prior to the bankruptcy. The Court referred to Cockerill v Westpac Banking Corporation[7] where Drummond J struck out a proceeding because the bankrupt commenced the proceeding as opposed to the Trustee. But again, that related to a cause of action which accrued to the plaintiff prior to the bankruptcy. Both these cases are unhelpful because the subject matter of the cause of action upon which the plaintiff sued, had accrued to the plaintiff prior to bankruptcy, and of course on bankruptcy, it had vested in the Trustee.[8]
[6] [2003] QCA 218.
[7] (unreported) Federal Court of Australia, 9 March 1992.
[8] Bankruptcy Act 1966, s 116.
Here, the transaction the subject of the cause of action occurred subsequent to Mr Skobla’s bankruptcy. The respondent submits that an undischarged bankrupt is able to enter into personal commercial transactions in his or own name, and is then entitled to commence proceedings to recover any loss as a consequence of a breach of the transaction. It may well be that those monies may, on demand by the trustee, have to be paid to the trustee[9] but that is a matter between the trustee and the bankrupt in the administration.
[9] Bankruptcy Act 1966, s 129(4)(a).
Here the cause of action is for monies lent pursuant to an oral agreement between Mr Skobla and Mr Corry, it is alleged that Mr Corry had not repaid the monies in accordance with the terms of the agreement and it is on that cause of action upon which the decision was made. In my view the factual circumstances of this case are distinguishable from Cockerill and Stone because the cause of action arose subsequent to Mr Skobla’s bankruptcy.
By way of example, it would be nonsense if an undischarged bankrupt was an employee, had accrued wages and benefits, and if not paid by the employer, the employee would have no right of recovery through any legal proceeding without the assistance of the Trustee in Bankruptcy.
The decision by default was regularly entered and as a consequence there has been no error of law.
No submissions have been directed to the question of service. A perusal of the minor civil dispute file indicates that there is proof of service[10]. The Registrar must be satisfied as to service before a default decision is made. Mr Corry swears he was not served with the application. However this does not establish that the decision was irregularly entered as there is an affidavit of service filed. It is a factor going to the discretion to set aside the decision.
[10] Affidavit of Mr Corry paragraph 52.
The applicant seeks to then argue the usual grounds upon which a decision by default can be set aside. It is not for this Appeal Tribunal to entertain those submissions because they do not go to error on the part the decision maker at the time the default decision was made, nor to the question of whether leave should be granted. The applicant can put those submissions before the Tribunal in the minor civil disputes jurisdiction, as that is the appropriate venue to ventilate those arguments. It is not here. Therefore, as no error has been identified on the part of the applicant leave to appeal must be refused.
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