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Coshott v Parker

Coshott v Parker

Case [2017] NSWSC 1098 18 August 2017

Jurisdiction

Statutory Interpretation

Bankruptcy Law

Federal Jurisdiction

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Supreme Court

New South Wales

Medium Neutral Citation: Coshott v Parker [2017] NSWSC 1098
Hearing dates: 15 August 2017
Decision date: 18 August 2017
Jurisdiction: Common Law
Before: Adamson J
Decision:
(1) Transfer the proceedings to the Federal Court of Australia pursuant to s 6(1) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW).
(2) Order the respondents/plaintiffs to pay the applicants’/defendants’ costs of their application for transfer made by amended notice of motion filed on 5 May 2017.
Catchwords:
JURISDICTION – exclusive jurisdiction of Federal Court “in bankruptcy” – whether matters arising under the Bankruptcy Act fell within the Federal Court’s exclusive jurisdiction or could be determined by State Supreme Court in the exercise of its federal jurisdiction – relevance of trustee choosing not to take an active part in claiming alleged debts as assets in the bankrupt estate of discharged bankrupt
JURISDICTION – right of set-off under s 86 of the Bankruptcy Act 1966 – HELD fell within jurisdiction “in bankruptcy” because s 86 is a code and constitutes the sole source of the creditor’s right to set off in relation to mutual dealings – special federal matter – transfer to Federal Court required
Legislation Cited: Bankruptcy Act 1966 (Cth), ss 5, 27, 31, 35, 35A, 58, 60, 86, 116, 134
Constitution, ss 75, 76
Judiciary Act 1903 (Cth), ss 39, 39B,
Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth), ss 3, 6
Limitation Act 1969 (NSW)
Cases Cited: Cooper v Moloney (No 5) [2012] SASC 211; (2012) 271 FLR 304
Day & Dent Constructions Pty Ltd (in liquidation) v North Australian Properties Pty Ltd (provisional liquidator appointed) (1982) 150 CLR 85; [1982] HCA 20
Day & Dent Constructions Pty Ltd (in liquidation) v North Australian Properties Pty Ltd (provisional liquidator appointed) (1981) 34 ALR 595
Gorkowski v Turner [2014] VSC 200; (2014) 285 FLR 66
Hiley v Peoples Prudential Assurance Co Ltd (in liq) (1938) 60 CLR 468; [1938] HCA 40
Jakimowicz v Jacks [2016] VSCA 42; (2016) 306 FLR 51
Mateljan v HTT Huntley Heritage Pty Ltd [2016] NSWCA 20; (2016) 111 ACSR 277
Meriton Apartments Pty Ltd v Industrial Court of New South Wales (2008) 171 FCR 380; [2008] FCAFC 172
Morris Finance Ltd v Brown [2016] NSWCA 343; (2016) 315 FLR 469
Moss v Eaglestone (2011) 83 NSWLR 476; [2011] NSWCA 404
Re Wakim; Ex Parte McNally (1999) 198 CLR 511; [1999] HCA 27
Scott v Bagshaw (2000) 99 FCR 573; [2000] FCA 816
Truthful Endeavour Pty Ltd v Condon (2015) 233 FCR 174; [2015] FCAFC 70
Category: Principal judgment
Parties: Ljiljana Coshott and Robert Gilbert Coshott formerly trading as Robert G Coshott & Associates (Respondents/Plaintiffs)
Michelle Lena Parker (Applicant/ First Defendant)
Christina Marie Collins (Applicant/Second Defendant)
Representation:
Counsel:
O Jones (Respondents/Plaintiffs)
M Castle (Applicants/First and Second Defendants)
Solicitors:
Comino Prassas (Respondents/Plaintiffs)
Hicksons Lawyers (Applicants/First and Second Defendants)

File Number(s): 2015/357066

Judgment

Introduction

By amended notice of motion filed on 5 May 2017…

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.

Continue reading Coshott v Parker

Details

AGLC: Coshott v Parker [2017] NSWSC 1098
Case: [2017] NSWSC 1098
Decision Date: 18 August 2017

CaseChat Overview and Summary

The case of Coshott v Parker involved a dispute over jurisdiction between the Federal Court and the Supreme Court of New South Wales. The matter arose from a claim by the plaintiff, Coshott, against the defendant, Parker, who had been a bankrupt. Coshott sought to recover debts allegedly owed by Parker as assets of the bankrupt estate. The crux of the dispute was whether the Federal Court had exclusive jurisdiction over matters related to bankruptcy, or if the Supreme Court could exercise federal jurisdiction in such matters. The Federal Court was asked to determine if the trustee's decision not to actively pursue certain debts as assets of the bankrupt estate affected the court's jurisdiction.

The primary legal issue before the court was whether the Federal Court had exclusive jurisdiction over matters arising under the Bankruptcy Act. Specifically, the court needed to ascertain if the statutory provisions allowing for the set-off of debts fell within the exclusive jurisdiction "in bankruptcy" as defined by the Federal Court Act. The court had to consider whether the Bankruptcy Act constituted a code that governed the rights of creditors to set off debts, and if such matters were special federal matters that required transfer to the Federal Court.

In addressing the jurisdictional issue, the court held that the right of set-off under section 86 of the Bankruptcy Act fell within the exclusive jurisdiction "in bankruptcy". The court determined that section 86 constituted a code governing the set-off of debts in relation to mutual dealings and, as such, was a special federal matter. The court concluded that the Bankruptcy Act provided the sole source of the creditor's right to set off, which necessitated the transfer of the case to the Federal Court for resolution. Consequently, the Supreme Court of New South Wales did not have jurisdiction to hear the matter.

The final orders of the court mandated the transfer of the case to the Federal Court for further proceedings. The Supreme Court of New South Wales was directed to cease any further action on the matter, recognising that it lacked the jurisdiction to hear claims arising under the Bankruptcy Act, particularly those related to the right of set-off. This decision underscored the importance of adhering to jurisdictional boundaries in matters concerning bankruptcy and the exclusive jurisdiction of the Federal Court in such cases.

Orders