Crock v Kyriakopoulou
[2000] FCA 596
•10 MAY 2000
FEDERAL COURT OF AUSTRALIA
Crock v Kyriakopoulou [2000] FCA 596
Bankruptcy Act 1966 s 52
Ling v Enrobook (1997) 143 ALR 396 applied
HENRY V CROCK and MARY CROCK v MELPOMENI KYRIAKOPOULOU
V 7519 of 1999SUNDBERG J
10 MAY 2000
MELBOURNE
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
V 7519 OF 1999
BETWEEN:
HENRY V CROCK
FIRST APPLICANTMARY CROCK
SECOND APPLICANTAND:
MELPOMENI KYRIAKOPOULOU
RESPONDENT
JUDGE:
SUNDBERG J
DATE OF ORDER:
10 MAY 2000
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.The estate of the abovenamed respondent be sequestrated.
2.The applicants’ costs, including any reserved costs, be taxed and paid in accordance with the Bankruptcy Act 1966.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
V 7519 OF 1999
BETWEEN:
HENRY V CROCK
FIRST APPLICANTMARY CROCK
SECOND APPLICANTAND:
MELPOMENI KYRIAKOPOULOU
RESPONDENT
JUDGE:
SUNDBERG J
DATE:
10 MAY 2000
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
BACKGROUND
The respondent sued the applicants, who are medical practitioners, in the County Court at Melbourne for damages for professional negligence. The action was dismissed, and the respondent was ordered to pay costs of $92,518.67. The applicants caused a bankruptcy notice to be issued which demanded payment of the amount of the judgment. The requirements of the notice were not satisfied and the applicants filed a creditors petition seeking the sequestration of the respondent’s estate. The respondent’s notice of opposition to the petition contains two grounds. The first is that she did not receive a fair hearing in the County Court. The second is that the solicitors appearing for her in the County Court charged her for services they did not provide despite her paying them $5000 during the trial. These grounds are relied on as constituting “other sufficient cause” why a sequestration order should not be made. Cf s 52(2)(b) of the Bankruptcy Act 1966. Because the respondent was appearing for herself, I permitted her to raise other grounds. They were that she had not been served with the bankruptcy notice, she had not been served with the petition, and the order made by the taxing officer of the County Court was not signed by him but by someone else and was thus a forgery. These additional grounds go to whether the formal requirements for the making of a sequestration order have been satisfied.
FAIR HEARING AT TRIAL
No interpreter for ex‑husband
The respondent’s ex‑husband was a witness called by her. English was not his first language, but he spoke it reasonably well. When it became apparent that the interpreter whose attendance had been arranged was not present, counsel for the respondent elected to proceed without him. The presiding judge, Judge Morrow, said “We’ll see how we go”. The ex‑husband gave his evidence without the assistance of the interpreter. Neither the Judge nor the respondent’s counsel sought to defer the taking of the evidence on the ground that the witness was having trouble giving it. The only proper inference is that he did not give the appearance that he was having trouble. In any event, there is no evidence before me as to the importance or otherwise of the evidence the witness was to give in an action against medical practitioners for negligence, or that the evidence he was to give did not come out as it should have done because no interpreter was present. Nor was there any evidence that the absence of the interpreter resulted in a proceeding that was so unfair as to throw doubt upon the jury’s decision. The respondent has not established this component of her claim that she was denied a fair hearing.
Pleadings not amended
During the trial the respondent sought a second opinion as to the way in which her case was being presented. Apparently she was advised that the pleadings should be amended. It is not clear what amendment was proposed, but it may have been to raise an issue as to psychological problems suffered by the respondent. She claims that the solicitors acting for her in the trial did not seek leave to amend, despite her instructions that they should do so. There are a number of difficulties in the respondent’s path in establishing that her solicitors’ failure to seek an amendment constitutes a reason why a sequestration order should not be made. There is no clear evidence as to what the amendment was intended to raise. There is no evidence that the point sought to be raised had any merit, or that had the amendment been made the result of the case would or might have been different. Further, any claim the respondent may have is against a third party (the solicitors) and not against the applicants. In Ling v Enrobook (1997) 143 ALR 396 at 401 the Full Court said:
“The above authorities do not, in our view, support the appellant’s contention that the courts recognise a public interest in allowing a debtor to prosecute litigation commenced by the debtor. The public interest recognised by such authorities is that which, in broad terms, is reflected also in s 40(1)(g) of the Act; that is, that a sequestration order should only to be made on the basis of an indebtedness which is not counterbalanced by a claim by the debtor against the petitioning creditor. Such authorities provide no comfort to a debtor who asserts a claim, not against his or her creditor, but against a third party.”
On a different topic the Full Court later said (at 401‑402):
“The authorities also show that satisfaction that the debtor is well advanced with litigation likely to result in the debtor being in a position to pay his or her debts may well provide a basis for a finding that there is a ‘sufficient cause’ for a sequestration order not to be made …. But the authorities do not suggest that it is in the public interest to allow insolvent debtors to prosecute litigation generally. They only recognise that it is not in the public interest for a debtor to be forced into bankruptcy by reason of a state of insolvency likely to be only of short duration.”
The respondent has not sued her former solicitors for allegedly failing to follow her instructions. She has not even said she intends to do so. The respondent has neither established that the unfairness she asserts had any effect on the outcome of her case, nor that it constitutes any sufficient cause why a sequestration order ought not be made.
No appeal as instructed
This complaint does not really come under the fair hearing heading, but I will deal with it here since that is where it arose in argument. There is no satisfactory evidence that the respondent gave her solicitors formal instructions to appeal. There is no evidence that there was any prospect of success on the appeal. What I have said under the preceding heading is applicable here. Any claim based on the alleged failure to follow the respondent’s instructions would be against third parties, no proceedings have been instituted against the solicitors, and the respondent did not assert an intention to sue them.
Transcript not provided
Judge Morrow provided the respondent with parts of the transcript during or immediately after the trial, including his charge to the jury. Apparently she received the balance of the transcript about a year later. It seems that the respondent’s grievance is that her ability to appeal against the dismissal of her action was affected by the absence of the transcript. There is no satisfactory evidence that the absence of a transcript prevented her legal advisers from instituting an appeal.
The judge’s charge
The only complaint made about Judge Morrow’s charge to the jury was that he told them that damages are assessed once and for all at the trial, and that neither party can come back later and say “look, the view that you took at the time was incorrect”. This was said to be wrong. It is in fact a correct statement of the law.
Medical witnesses
The respondent complained that several medical practitioners who were under subpoena to attend and give evidence for her did not attend court. Presumably the respondent’s legal advisers decided not to call them. No adjournment was sought in order to secure their attendance. The only reasonable inference is that in the view of the legal advisers their evidence would not have assisted the respondent’s case. It does not appear what evidence the witnesses would have given. Nor does it appear that the evidence they would have given would or might have caused the jury to return a verdict for the respondent.
CHARGED FOR SERVICES THE RESPONDENT DID NOT RECEIVE
The respondent says that during the trial she paid her solicitors $5000 to cover the costs of amending the pleadings and securing the attendance of the medical witnesses. In fact the pleadings were never amended, and at least some of the medical witnesses did not attend court to give evidence. The fact that she made this payment adds nothing to her claim that the solicitors did not conduct her case properly.
BANKRUPTCY NOTICE NOT SERVED
I accept the evidence of the process server, Mr Scates, that he knocked on the respondent’s Canterbury Road door, asked the person who opened it whether she was the respondent, the person said she was, he told her he had a legal document for her, and when she refused to accept it, placed it at her feet. Mr Scates was not cross‑examined. Even on the respondent’s account of what happened it is clear that she received the notice. She says she answered the door, the process server asked her whether she was “a name he mumbled”, and he then threw the document under the door before she had a chance to respond. She then wrote the details of the incident on the back of the bankruptcy notice.
PETITION NOT SERVED
The petition was served in accordance with a Registrar’s order for substituted service. In compliance with the order, a copy of the petition was posted to the respondent at the Canterbury Road address. A copy was posted to her former solicitors and was received by them. A copy was served on a person at the Canterbury Road premises.
FORGED ORDER
The respondent asserts that the order made by the County Court Taxing Registrar, Mr Ross Cook, is a forgery because it is not signed by him but by another Registrar. This complaint has no substance. The order is signed by the Taxing Registrar by the typed words “Mr Ross Cook”, and is authenticated by another Registrar who has affixed the Court’s stamp or seal and applied a stamp containing his name. Even if the order were deficient in the respect claimed, it would not signify. In the petition the sum claimed is said to be owing pursuant to the order made by Judge Morrow when he dismissed the action and ordered that the respondent pay the plaintiffs’ taxed costs.
CONCLUSION
The formal requirements for the making of a sequestration order have been satisfied, and the respondent has not discharged the onus of showing that there is some “other sufficient cause” why a sequestration order should not be made. She has not attempted to establish that she is able to pay her debts. Accordingly I will make a sequestration order.
I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Sundberg. Associate:
Dated: 10 May 2000
Counsel for the Applicants: J Nolan Solicitors for the Applicants: Blake Dawson Waldron The respondent appeared in person Date of Hearing: 8 May 2000 Date of Judgment: 10 May 2000