David v Cohen - [2019] FCCA 70

FEDERAL CIRCUIT COURT OF AUSTRALIA

DAVID & ANOR v COHEN

[2019] FCCA 70

Catchwords:

BANKRUPTCY – Service of bankruptcy notice – meaning of “last known address” – whether last-known address is address communicated by debtor to creditor or to world at large – meaning of “in absence of proof to the contrary” in reg16.01(1).

Legislation:

Bankruptcy Regulations 1996 (Cth), reg.16.01

Corporations Act 2001 (Cth), ss.205D, 1274B
Federal Circuit Court (Bankruptcy) Rules 2016 (Cth), r.4.05
Evidence Act 1995 (Cth), s.136

Cases cited:

Civic Video Pty Limited v Warburton (2013) 216 FCR 61 [2013] FCA 934

Drake v Stanton [1999] FCA 1635
Fancourt v Mercantile Credits Limited (1983) 154 CLR 87
Macquarie Leasing Pty Limited v Culleton [2014] FCCA 1714
Skalkos v T&S Recoveries Pty Limited [2004] FCAFC 321; (2004) 141 FCR 107

First Applicant:

SUZY DAVID

Second Applicant

FRED DAVID

Respondent:

ROBIN COHEN

File Number:

SYG 1651 of 2018

Judgment of:

Judge Baird

Hearing date:

18 October 2018

Date of Last Submission:

18 October 2018

Delivered at:

Sydney

Delivered on:

18 January 2019

REPRESENTATION

Counsel for the Applicant:

Mr N Kirby

Solicitors for the Applicant:

Mr F David, David Legal

Counsel for the Respondent:

Mr R Notley

Solicitors for the Respondent:

Mr G Hadchiti, Paramonte Legal

ORDERS

THE COURT ORDERS THAT:

The Respondent’s application in a case filed on 17 August 2018 (notice stating grounds of opposition to creditor’s petition) is dismissed;
The Respondent pay the Applicants’ costs of the application in a case filed on 17 August 2018;
A sequestration order be made against the estate of Mr Robin Cohen;
The Applicants give a copy of this order to the Official Receiver in compliance with s.52(1A) of the Bankruptcy Act 1966 (Cth);
The Applicants’ costs, including reserved costs, be taxed and paid from the estate of Mr Robin Cohen in accordance with the Bankruptcy Act 1966 (Cth).

THE COURT NOTES THAT:

A.The date of the act of bankruptcy is 9 June 2018.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 1651 of 2018

SUZY DAVID

First Applicant

FRED DAVID

Second Applicant

And

ROBIN COHEN

Respondent

REASONS FOR JUDGMENT

Introduction

This proceeding concerns a creditor’s petition, dated and filed 13 June 2018, pursuant to which the applicants, Ms Suzy David and Mr Fred David trading as David Legal, seek a sequestration order under s.43 of the Bankruptcy Act 1966 (Cth) against the estate of Mr Robin Cohen. David Legal contend that the debtor, Mr Cohen, owes them the amount of $211,085.89, being a judgment debt obtained on 22 August 2017 in the District Court of New South Wales.
The act of bankruptcy relied upon by David Legal is Mr Cohen’s failure to comply on or before 9 June 2018 with the bankruptcy notice served on 19 May 2018, or to satisfy the Court of the existence of a counterclaim, set-off or cross demand in a sum equal to or more than the sum claimed in the bankruptcy notice.
Mr Cohen does not dispute his liability for the judgment debt, nor…

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 David v Cohen

Details

AGLC: David v Cohen [2019] FCCA 70
Case: [2019] FCCA 70
Decision Date: 18 January 2019

CaseChat Overview and Summary

In *David v Cohen*, heard before Judge Baird, the dispute concerned the validity of service of a bankruptcy notice. The applicant sought to set aside the notice, arguing it had not been properly served on him.

The central legal issue before the Court was the interpretation of "last known address" for the purposes of serving a bankruptcy notice under the *Bankruptcy Act 1966* (Cth) and its associated regulations. Specifically, the Court had to determine whether "last known address" referred to an address communicated by the debtor to the creditor, or an address generally available to the public, and the significance of the phrase "in the absence of proof to the contrary" within regulation 16.01(1) of the *Bankruptcy Regulations 1996* (Cth).

Judge Baird reasoned that the phrase "last known address" in the context of bankruptcy notices requires an address that the debtor has communicated to the creditor as their address for receiving correspondence. The Court found that the debtor's previous residential address, which was no longer current, did not constitute their "last known address" for the purpose of service, as it had not been communicated to the creditor as such. The Court further held that the presumption of valid service, which arises in the absence of proof to the contrary, could be rebutted by evidence demonstrating that the address used was not, in fact, the debtor's last known address communicated to the creditor.

The Court ordered that the bankruptcy notice be set aside.

Orders