Deputy Commissioner of Taxation v Fraser

[2015] FCCA 2061

FEDERAL CIRCUIT COURT OF AUSTRALIA

DEPUTY COMMISSIONER OF TAXATION v FRASER [2015] FCCA 2061

Catchwords:
BANKRUPTCY – Sequestration order – lengthy litigation history – no appearance by respondent – order made.

Applicant: DEPUTY COMMISSIONER OF TAXATION

Respondent: DAVID JOHN FRASER

File Number: SYG 2294 of 2013

Judgment of: Judge Altobelli

Hearing date: 30 April 2015

Date of Last Submission: 30 April 2015

Delivered at: Sydney

Delivered on: 30 April 2015

REPRESENTATION

Solicitors for the Applicant: Mr Marinovic

No appearance by the Respondent

ORDERS

1. A sequestration order is made against the estate of DAVID JOHN FRASER.

2. The Petitioning Creditor’s costs, including reserved costs, if any, be taxed and paid in the sum of $5428.00.

NOTATIONS

(A)The Court notes that the date of the act of bankruptcy is 28 March 2013.

(B)The Court notes the obligations on the applicant creditor to notify, enter and serve these orders in accordance with the Federal Circuit Court (Bankruptcy) Rules 2006 (Cth).

(C)The Court notes that a Consent to Act as Trustee has been signed by Nicholas Malanos on 26 September 2014.

(D)These orders were made in the absence on the Respondent as there was no appearance by or on behalf of the Respondent when the matter was called at 10:06am.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2294 of 2013

DEPUTY COMMISSIONER OF TAXATION

Applicant

And

DAVID JOHN FRASER

Respondent

REASONS FOR JUDGMENT

1. In SYG 2294 of 2013, the matter of Deputy Commissioner of Taxation v David Fraser, I make a sequestration order.  I note that the date of the bankruptcy is 1 March 2013 and I will make an order for costs in the sum of $5,522.20. 

2. David Fraser did not attended today.  The Commissioner was informed last night that Mr David Fraser would not attend.  His non-attendance today is unexplained.  The Court is prepared to infer that it might have something to do with Mrs Fraser’s medical condition.  Again, however, there is no reason why they could not have contacted my Associate and asked to participate in the hearing by telephone.  In any event, to have granted an adjournment in the circumstances of this case would have been futile and, indeed, possibly an abuse of process. 

3. The matter has a long litigation history and the matters raised in opposition to the Creditor’s Petition appear to have no substance.  I will briefly outline the litigation history of this matter.

4. The Creditor’s Petition was filed on 27 September 2013 together with the usual accompanying documents.  The matter appears to have first come before the Court before Registrar Hannigan on 1 November that year.  A number of directions were made pertaining to the filing of documents. 

5. The matter came back before the Court on 28 November 2013 and, again, further directions were made for the filing of documents. I note that further directions were made for the filing of documents that were ordered to be filed on the first occasion but were not. 

6. The matter appears to have come back before the Court on 16 December 2013, this time before Registrar Segal.  Further directions were made and the matter was adjourned to 24 February.  On 24 February the matter was adjourned by consent.  On 24 March 2014 the matter again came before Registrar Segal and the Petition was adjourned by consent.  On 12 May 2014, once again the Petition was adjourned by consent, likewise on 16 June.  Then on 14 July 2014, before Registrar Hannigan, again the Petition was adjourned by consent.  On 25 August, another adjournment.  On 8 September, a further adjournment. 

7. On 15 September the matter first came into my docket.  There was no appearance by Mr Fraser on that occasion and a number of orders were made, for example, extending the period of the Creditor’s Petition, giving the opportunity to file an amended Notice stating grounds of opposition together with an opportunity to file further evidence. 

8. The matter next came before me on 27 October.  Mr Fraser appeared in person.  The matter in fact commenced on that date and was adjourned part-heard to 13 January 2015. 

9. On 13 January, Mr Fraser, who was representing himself, had been invited to explain to the Court what was the substance of his defence or opposition, in circumstances where it was common ground that the only affidavit of evidence filed in his case was from his former solicitor and related to an application to set aside the District Court judgment that founds the debt in question, and which application was dismissed by consent.  Mr Fraser raised the possibility of the debt claimed by the Deputy Commissioner to have been affected by accounting issues and, namely, whether carried forward losses had to have been taken into account.  The notation made by myself on 27 October 2014 specifically says that the Respondent will consider what impact, if any, carried forward losses will have on the debt claimed by the Deputy Commissioner.  When the matter came before me on 13 January 2015 it was again adjourned by consent, but this time on the basis that there were discussions going on in relation to Mr Fraser. 

10. The matter next came before me on 19 February 2015 when I was sitting in Wollongong. Mr Fraser attended in person and Mr Lee, from the Deputy Commissioner, attended by telephone.  The matter was set down for Final Hearing on 30 April, that is today.  A direction was made for the parties to file and serve further material no later than 10 April.  No further material has in fact been filed on behalf of the Respondent. 

11. What becomes apparent from this litigation history is that the Deputy Commissioner has been exceedingly patient with Mr Fraser in terms of giving him every opportunity to seek to come to a satisfactory arrangement with the Deputy Commissioner and/or, alternatively, to put on a defence to the claim.  As at today, 30 April, almost 18 months after the Creditor’s Petition was first filed, it is apparent that they have not done so. 

12. The debt in question is a judgment debt in the sum of $364,302.90, or thereabouts.  What is apparent as at today’s date is that there has been no attempt, or certainly no evidence before the Court, of any application to stay, vary or set aside that judgment or, indeed, to appeal it.  None of the material that has been presented before the Court by Mr Fraser raises any substantive issue that would suggest that there is a legitimate ground or basis under the Bankruptcy Act or otherwise not to grant the Creditor’s Petition. 

13. The Deputy Commissioner of Taxation’s Case Outline document correctly sets out all the procedural requirements that were followed and, indeed, I incorporate the contents of the Case Outline document at schedule one. 

14. All of the relevant matters under the Act have been dealt with.  I note in particular that the Affidavits of Search and Debt have been updated as at yesterday. 

15. In short, there is no reason, either as a matter of law or under the Bankruptcy Act or as a matter of public policy, why, in the circumstances of this case, the sequestration order should not be made and it is so made.  

I certify that the preceding fifteen (15) paragraphs are a true copy of the reasons for judgment of Judge Altobelli

Associate: 

Date:  27 August 2015

Schedule one

IN THE FEDERAL CIRCUIT COURT OF AUSTRALIA
REGISTRY: SYDNEY                   

No. SYG2294 of 2013

IN THE MATTER OF:   PAMELA LOUISE FRASER

DEPUTY COMMISSIONER OF TAXATION
  Applicant

DAVID FRASER

Respondent

CASE OUTLINE DOCUMENT

In this matter, the Deputy Commissioner of Taxation (“DCT”) has filed a Creditors Petition (“Petition”) and seeks a sequestration order against the Respondent debtor (“David Fraser”) estate.

All the correct procedural requirements were followed:

1. The Petition was filed on 27 September 2013 and verified by the Affidavit of Narbada Rana affirmed 26 September 2013.

1. This Petition is based upon non-compliance with a Bankruptcy Notice dated 1 March 2013 and grounded upon a District Court Judgment obtained on 4 February 2013 in the sum of $364,302.30

1. In support of the contention in paragraph 2, the Applicant seeks to rely on the Affidavit of Service of Bankruptcy Notice of Andrew Jones, sworn on 8 March 2013 and filed 27 September 2013.

1. The Affidavit of initial search is of Mercia Mitchell, affirmed on 25 September 2013 and filed on 27 September 2013 and shows that there has been no other petitions commenced by any other creditor of the debtor or that the debtor has filed an application on their behalf.

1. A sealed copy of the Creditor’s Petition together with copies of the supporting Affidavits were personally served on the Respondent on 9 October 2014.

1. In support of the contention in paragraph 2, the Applicant seeks to rely on the Affidavit of Service of the Creditors Petition and supporting documents of Andrew Jones, sworn on 9 October 2013 and filed on 16 October 2013.

1. The Affidavit of Final Search is of Goran Marinovic, affirmed on 29 April 2015.

1. The Affidavit of Debt is of Anita Tiku, affirmed on 29 April 2015.

2. The DCT seeks a sequestration order against David Fraser based on noncompliance with the Bankruptcy Notice dated 1 March 2013 pursuant Section 43 of the Bankruptcy Act and a order for costs fixed in the amount of $5,522.20.