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Coshott v Prentice

Coshott v Prentice

Case [2015] FCCA 241 29 May 2015

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FEDERAL CIRCUIT COURT OF AUSTRALIA

COSHOTT & ANOR v PRENTICE

[2015] FCCA 241

Catchwords:
BANKRUPTCY – Determination of the status of creditors – consideration of debts purportedly assigned to the applicants – trustee seeking the Court’s direction as to how to treat the claimed debts.

Legislation:

Bankruptcy Act 1966 (Cth), ss.30, 64, 64ZB, 82, 134

Corporations Act 2001 (Cth), ss.244, 286, 601AD
Law Reform (Miscellaneous Provisions) Act 1965 (NSW), s.3

Bechrose Pty Ltd v Jefferson (1999) 94 FCR 494; [1999] FCA 1153
Dunwoody v Jefferson [2000] FCA 456
Forshaw v Thompson (1992) 35 FCR 329; 106 ALR 633
Hingston v Westpac Banking Corporation (2012) 200 FCR 493; [2012] FCAFC 41
Liprini v Pascoe (2012) 292 ALR 778; [2012] FCA 886
Litigation Fund Pty Ltd v Burton [2002] FCA 567
Meriton Apartments Pty Ltd v Industrial Court ofNSW (2008) 171 FCR 380; [2008] FCAFC 172
Pitman v Pantzer (Trustee of the Bankrupt estate of Wenkart) (2001) 115 FCR 361; [2001] FCA 1743

Talacko v Talacko (2010) 183 FCR 311; [2010] FCAFC 54
Vale v Sutherland (2009) 237 CLR 638; [2009] HCA 26

Westpac Banking Corporation v Worrell (1993) 47 FCR 478; 119 ALR 265

First Applicant:

RONALD MICHAEL COSHOTT

Second Applicant:

FEWIN PTY LIMITED

Respondent:

MAXWELL WILLIAM PRENTICE

File Number:

SYG 2055 of 2013

Judgment of:

Judge Driver

Hearing date:

5 February 2015

Delivered at:

Sydney

Delivered on:

29 May 2015

REPRESENTATION

Counsel for the Applicant:

Mr A Cheshire

Solicitors for the Applicant:

Martin Place Lawyers

Counsel for the Respondent:

Mr J T Johnson

Solicitors for the Respondent:

Sally Nash & Co

ORDERS

The parties are to forward to chambers short minutes of order consistent with these reasons within 14 days.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2055 of 2013

RONALD MICHAEL COSHOTT

First Applicant

FEWIN PTY LIMITED

Second Applicant

And

MAXWELL WILLIAM PRENTICE

Respondent

REASONS FOR JUDGMENT

Introduction and background

The first applicant, Mr RM Coshott, is the brother of Robert Gilbert Coshott (the bankrupt) who was made bankrupt by a sequestration order made on 7 November 2008. The second applicant (Fewin) is a company controlled by Mr RM Coshott. The respondent (the trustee) is the present trustee of the bankrupt estate of the bankrupt, having been appointed at a meeting of creditors on 21 March 2013. That meeting had been called by the Official Trustee, following the resignation of the first trustee, Mr John Burke.
There has been a great deal of litigation over many years leading up to the bankruptcy of the bankrupt and flowing from it. In these proceedings, the applicants seek to have their status as creditors in the bankruptcy determined and confirmed and seek an order compelling the trustee to call a meeting of creditors.
There is no dispute that the trustee is the current trustee of the bankrupt, and that the trustee considers, subject to there being a reason to vary decisions made by Mr Burke, the former trustee, that he is…

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 Prentice

Details

AGLC: Coshott v Prentice [2015] FCCA 241
Case: [2015] FCCA 241
Decision Date: 29 May 2015

CaseChat Overview and Summary

In *Coshott v Prentice*, the Supreme Court of New South Wales was asked to determine a dispute between the plaintiff, Coshott, and the defendant, Prentice. The core of the disagreement concerned the interpretation and enforceability of a deed of settlement entered into by the parties, which aimed to resolve prior litigation.

The primary legal issue before the Court was whether the deed of settlement was valid and binding, or if it was vitiated by a fundamental mistake. Specifically, the Court had to consider whether the parties had entered into the deed under a shared, mistaken belief about a crucial fact that underpinned their agreement, and if so, whether that mistake was of such a nature as to render the contract void or voidable.

Judge Driver found that the parties had indeed entered into the deed of settlement under a common and fundamental mistake regarding the existence of a particular debt. This mistake was central to the parties' understanding of the settlement terms and their respective rights and obligations. Applying established principles of contract law concerning mistake, the Court determined that the deed was void *ab initio* due to this fundamental misapprehension of fact.

Consequently, the Court made orders setting aside the deed of settlement.

Orders