Crown Diagnostic Imaging Pty Ltd v Sood (No.3)

[2006] FMCA 398

FEDERAL MAGISTRATES COURT OF AUSTRALIA

CROWN DIAGNOSTIC IMAGING PTY LTD v SOOD (NO.3) [2006] FMCA 398

BANKRUPTCY – Application for stay of sequestration order – where bankrupt has previously given undertakings that were not honoured – where no draft grounds of appeal are proffered – where bankrupt owes a sum in excess of $500,000 to a series of creditors.

Gould v Day [2002] FCA 66
Teese v Clinch [2002] FMCA 205

Applicant: CROWN DIAGNOSTIC IMAGING PTY LTD

Respondent: SUMAN SOOD

File Number: SYG1633 of 2005

Judgment of: Raphael FM

Hearing date: 6 March 2006

Date of Last Submission: 6 March 2006

Delivered at: Sydney

Delivered on: 6 March 2006

REPRESENTATION

Solicitors for the Applicant: Griffith Nicholson

For the Respondent: In person

Solicitors for the Petitioning Creditor: Sally Nash & Co

ORDERS

1. Application dismissed.

2. Applicant debtor pay the respondent creditor's costs and those of the petitioning creditor to be taxed if not agreed.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG1633 of 2005

CROWN DIAGNOSTIC IMAGING PTY LTD

Applicant

And

SUMAN SOOD

Respondent

REASONS FOR JUDGMENT

1. On 1 March 2006 I determined that a sequestration order should be made against the estate of Dr Suman Sood and I handed down my reasons for so doing.  On 3 March 2006 Dr Sood issued an application in this court seeking a stay of the sequestration order until an appeal was lodged and heard.  In her affidavit in support Dr Sood says:

   “I disagree with the judgment and want to file an appeal.  I am seeking legal advice re lodging appeal.”

2. Today Dr Sood told me that her legal representative, Mr Bowles, who had appeared on her behalf in the original proceedings, did not wish to be involved in the appeal.

3. Ms Jarrett, who appears on behalf of the petitioning creditor, opposes the application and submits that no proper grounds are given which would indicate the basis of any appeal.  She reminds me that Dr Sood gave undertakings to the court to effect certain sales of shares in order to repay the amount of money owed to her client.  These undertakings were not complied with.  She tells me that her client is reluctant to accept any further undertakings from Dr Sood and believes that, given the amount of indebtedness which, excluding the Health Insurance Commission, is approximately $500,000, it is most appropriate that a trustee take control of Dr Sood's affairs as soon as possible.  Ms Britton, who appears on behalf of a supporting creditor, says that she does not have any firm instructions in the matter as she was only told about the application today, but she anticipates that when instructions come they will be to oppose.

4. Of course, Dr Sood has the right to appeal my decision.  Of course, it is possible that my decision is wrong and that there was an effective stay upon the judgment at the time the bankruptcy notice was issued.  But at the present time that is not the situation.  Dr Sood owes a lot of money to a lot of people.  She made promises to repay some of that money from sources available to her.  She told the court that she was going to do so but she did not.  She has provided me with no reasons of her own as to why she cannot make attempts to raise money for the purposes of pursuing the appeal, notwithstanding that she is in bankruptcy.

5. In all the circumstances I do not believe that it is in the public interest or in the interests of these creditors for the sequestration order to be stayed.  In any event, there are limitations on my ability to stay a sequestration order where there is no appeal pending; Gould v Day [2002] FCA 66; Teese v Clinch [2002] FMCA 205.

6. I dismiss the application.  I order that the applicant debtor pay the petitioning creditor's costs and those of the supporting creditor, such costs to be taxed if not agreed.

I certify that the preceding six (6) paragraphs are a true copy of the reasons for judgment of Raphael FM

Associate:

Date: