Crown Diagnostic v Sood (No.1)
[2006] FMCA 264
•21 February 2006
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CROWN DIAGNOSTIC v SOOD (No.1) | [2006] FMCA 264 |
| PRACTICE & PROCEDURE – BANKRUPTCY – Request for adjournment of creditor’s petition – where debtor has failed to comply with undertakings given to court – where it is suggested that a sequestration order would have no utility because of existence of injunction under Proceeds of Crimes Act. |
| Bankruptcy Act 1966, s.52 Proceeds of Crimes Act 2002, s.18 |
| Applicant: | CROWN DIAGNOSTIC IMAGING PTY LTD |
| Respondent: | DR SUMAN SOOD |
| File Number: | SYG1633 of 2005 |
| Judgment of: | Raphael FM |
| Hearing date: | 21 February 2006 |
| Date of Last Submission: | 21 February 2006 |
| Delivered at: | Sydney |
| Delivered on: | 21 February 2006 |
REPRESENTATION
| Counsel for the Applicant: | Mr C Wood |
| Solicitors for the Applicant: | Griffith Nicholson |
| Counsel for the Respondent: | Bowles Lawyers |
| Solicitors for the Respondent: | Sally Nash & Co |
ORDERS
Application for adjournment declined.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG1633 of 2005
| CROWN DIAGNOSTIC IMAGING PTY LTD |
Applicant
And
| DR SUMAN SOOD |
Respondent
REASONS FOR JUDGMENT
On 16 December 2005 I dealt with an adjourned application for a sequestration order against the respondent debtor. The respondent debtor is a medical practitioner who appears to been convicted of certain offences and against whom orders under s.18 of the Proceeds of Crimes Act 2002 had been made preventing the disposal or otherwise dealing with her assets. The respondent debtor has appealed against her conviction and her appeal has been heard but not determined. If the appeal is successful the property which is the subject of the s.18 orders will be released and made available to the creditors who, according to a document found as schedule 1 to an order in proceedings between the Director of Public Prosecutions and the debtor, appear to total some $544,767.01.
When the matter came before me in December I was told that the respondent debtor had assets which would enable the payment of her debts, including the debt of the applicant creditor, in her superannuation account. I was told that subject to some technicality in relation to the name in which the shares were held those shares would be sold and payment would be effected, at least to the applicant creditor. Certain undertakings were given by the debtor and filed in the court file. Undertaking 1 was for the debtor to do everything within her power, influence and control to cause the applicant to be paid the judgment debt as soon as possible.
Some specific actions were then referred to. Undertaking 2 was an undertaking not to do anything that might cause any delay in the payment of the applicant's judgment and some specific matters were referred to thereafter. Undertaking 3 was that in the event that payment of the judgment debt had not been made by 31 January the applicant would file an affidavit detailing the reasons why the payment had not been made, what steps she had taken to effect payment, what steps other people may have taken to effect payment and how long it might take to remove any obstacles to payment.
Undertaking 4 was to do everything that was within the debtor's power to cause the applicant to be paid its costs and finally there was an undertaking that in the event that the trustee of the superannuation fund does not for any reason cause payment of the plaintiff's judgment the debtor would file and serve on all interested parties a notice of motion seeking orders to cause the trustee to make those payments immediately and have that motion made returnable before the vacation judge of the Supreme Court of New South Wales.
The matter was stood over until today when Mr Bowles appeared on behalf of the respondent debtor. He sought an adjournment. Mr Bowles conceded that the undertakings had not been complied with to the extent that the applicant had not been paid. He referred me to an affidavit on 17 February 2006 sworn by the debtor. I noted that that affidavit did not provide information about the shares that were being sold or why they had not been sold. It refers to an order that was placed and partly executed to sell 20,000 shares and pay the cash proceeds into the superannuation trust account but we do not know what those shares are or what the value of 20,000 of them is. There is some reference to the respondent's belief that payment would be made by the trustee of the fund but only after the trustee is satisfied that it has complied with the relevant taxation and superannuation laws. The applicant then refers to certain medical conditions she claims she suffers from.
Mr Bowles submits that the petition should be adjourned because any funds received by the trustee, if the application for a sequestration order is successful, will form part of the sequestered funds under the Proceeds of Crime Act and therefore no benefit will be obtained by the trustee or the creditors from the sequestration order. He argues that if the applicant is successful in her appeal there will be no need to have sold the shares in the superannuation fund and pay tax upon that sale and therefore requests that the matter be stood over until after the Court of Criminal Appeal makes it decision. He does not provide an undertaking that if the Court of Appeal is against the respondent debtor she will immediately consent to a sequestration order being made against her. Had that been put up I might have been more sympathetic.
I am not inclined to grant the adjournment. I think that the respondent debtor has failed to comply with the undertakings given to the court. Although I have not determined that matter for the purposes of any application for orders in contempt, it seems to me that the respondent debtor is a person who owes a very substantial amount of money and whose affairs would probably best be placed into the hands of a controlling Trustee provided, of course, the applicant can convince me of the matters required under s.52 of the Bankruptcy Act 1966.
I certify that the preceding seven (7) paragraphs are a true copy of the reasons for judgment of Raphael FM
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