Deputy Commissioner of Taxation v Hakan Atmali; Deputy Commissioner of Taxation v Hasan Atmali
[2013] FCCA 507
•4 June 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| DEPUTY COMMISSIONER OF TAXATION v HAKAN ATMALI DEPUTY COMMISSIONER OF TAXATION v HASAN ATMALI | [2013] FCCA 507 |
| Catchwords: BANKRUPTCY – Service of bankruptcy notice – whether personal service effected – whether service under Reg 16.01 effected – last known address. |
| Legislation: Bankruptcy Regulations 1996 |
| Magafas v Carantinos [2008] FMCA 1654 Drake v Stanton [1999] FCA 1635 |
| Applicant: | DEPUTY COMMISSIONER OF TAXATION |
| Respondent: | HAKAN ATMALI |
| File Number: | SYG 2973 of 2012 |
| Applicant: | DEPUTY COMMISSIONER OF TAXATION |
| Respondent: | HASAN ATMALI |
| File Number: | SYG 2974 of 2012 |
| Judgment of: | Judge Raphael |
| Hearing date: | 4 June 2013 |
| Date of Last Submission: | 4 June 2013 |
| Delivered at: | Sydney |
| Delivered on: | 4 June 2013 |
REPRESENTATION
| Solicitors for the Applicant: | Hunt & Hunt |
| Solicitors for the Respondents: | Foleys Solicitors |
THE COURT ORDERS THAT:
A Sequestration Order be made against the estate of Hakan Atmali.
The Applicant Creditor’s costs (including any reserved costs) be fixed in the amount of $3,113.80 and be paid from the estate of the Respondent Debtor in accordance with the Act.
Under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Receiver in Sydney within 2 days.
THE COURT NOTES:
(i) That the date of the act of bankruptcy is 30 July 2012.
THE COURT ORDERS THAT:
A Sequestration Order be made against the estate of Hasan Atmali.
The Applicant Creditor’s costs (including any reserved costs) be fixed in the amount of $2,993.80 and be paid from the estate of the Respondent Debtor in accordance with the Act.
Under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Receiver in Sydney within 2 days.
THE COURT NOTES:
(i) That the date of the act of bankruptcy is 30 July 2012.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2973 of 2012
| DEPUTY COMMISSIONER OF TAXATION |
Applicant
And
| HAKAN ATMALI |
Respondent
SYG 2974 of 2012
| DEPUTY COMMISSIONER OF TAXATION |
Applicant
And
| HASAN ATMALI |
Respondent
REASONS FOR JUDGMENT
There comes before me today two applications for sequestration orders against Mr Hasan Atmali and Mr Hakan Atmali. The former is the father of the latter. They both operate a business out of premises at Chisholm Road, Auburn, owned by the son and lived in by the father. They are indebted to the Deputy Commissioner of Taxation who obtained judgments against them in the District Court of New South Wales. It is said that consequent upon those judgments on 9 July 2012 they were served with bankruptcy notices. Mr Hakan Atmali disputes this and he is supported in his representations by his father. His father says that what took place was that during the course of 9 July a process server came to the premises and asked him whether he was Mr Hasan Atmali and then handed him the bankruptcy notices in respect of himself and his son. He told in evidence that those bankruptcy notices were not contained in envelopes addressed to himself and his son. That evidence Mr Hakan Atmali says is sufficient for the Court to find that the bankruptcy notice issued in respect of his debt was not served upon him.
The Court heard evidence from the process server, Mr Gabriellian who had sworn the affidavit of service on 12 July. Mr Gabriellian told the Court that he could not recall this particular event. He said that it was a first time service and he could not recognise either of the persons served. But he says he stands by his affidavit that he served the documents personally on both the father and the son. In response to a question from me Mr Gabriellian told that his method of serving bankruptcy notices was to place them in an envelope addressed to the person to whom they referred and that is what he would have done in this case.
Mr Hasan Atmali told the Court that he lived in the property at Chisholm Street although it belonged to his son. His son had moved out about 10 years ago when he got married and lived, apparently nearby, in Chiswick Road, Auburn or South Granville. He told that they ran a business utilising a lorry from the Chisholm Street address and that if mail came for his son at that address he would give it to him. He saw his son regularly as his son operated the lorry on the day shift and he operated it on the night shift. Mr Hasan Atmali told that when the service of the bankruptcy notice took place his son was not there, he was out working.
Under cross-examination Mr Hasan Atmali said that he did not give these documents to his son. Then he said he did not give the documents straight away to his son. He said he handed the papers to his solicitor and his son did not read them. He said he hid most of the documents from his son. In re-examination he told that he picked the documents up from the process server and put them in his garage and after that he talked to his son. Then he went to his solicitor with all the documents. He said, “I didn’t tell my son about the bankruptcy notice at all.”
When Mr Hakan Atmali gave evidence he said that he was not served with the bankruptcy notice but he said he was around the property on a daily basis. He told that he collected the mail but then he said that he did not collect documents. He was asked what happened when bills came to the property and he said that his father handled them. But he accepted that his father was illiterate and spoke very little English. He said that he did not recall being served with the District Court Statement of Claim or the bankruptcy notice or the creditor’s petition. Yet he took no steps to have the District Court proceeding set aside and he entered an appearance in respect of the petition. He told that it was about four months ago in March maybe, he said, that he found out about the bankruptcy notice. But he swore the affidavit disputing service in February.
I am of the view that the evidence of none of the witnesses is particularly satisfactory. It is understandable that Mr Gabriellian cannot remember this particular act of service when he spends his working life serving people with documents and that this service occurred nearly a year ago. On the other hand I think I can be satisfied that as a general rule Mr Hakan Atmali is not at the property during the day and in those circumstances I cannot be satisfied that personal service did occur. It seems to me to be more likely that Mr Hasan Atmali was given both notices.
However, this is not the end of the matter because it is not necessary to serve a bankruptcy notice personally. Regulation 16.01 of the Bankruptcy Regulations 1996[1] provide for several methods of service. By Regulation 16.01(a) service may be effected:
“By post, or by a courier service to the person at his or her last known address.”
[1] “Regulations”
Under Regulation 16.01(1)(c) service can be effected by the document:
“Being left in an envelope or similar packaging marked with the person’s name, at the last known address of the person.”
Mr Gabriellan told me that when serving bankruptcy notices they were served by being placed in an envelope with the name of the recipient of the notice placed upon it. In judging his evidence against that of Mr Hasan Atmali who states that the documents were not in an envelope I prefer the evidence of Mr Gabriellan. I find that Mr Hasan Atmali’s evidence was at best confused and at worst, tailored to a cause he proposed to support, namely, non-service upon his son the owner of the property in question.
In regard to Mr Hakan Atmali’s evidence I would say that I found that to be difficult to accept. It is to my mind unlikely that his father would not give him documents addressed to him. But whether his father gave him the bankruptcy notice or not is irrelevant for the purposes of these proceedings. The question is not receipt but service.
Having come to the conclusion that the bankruptcy notice addressed to Mr Hakan Atmali was handed to his father in an envelope the only matter that remains outstanding is whether or not the property at Chisholm Street could be considered to be Mr Hasan Atmali’s last known address. It is settled law that the last known address does not refer to residential address. As Ms Fox has helpfully extracted from the decision of Tamberlin J in Drake v Stanton [1999] FCA 1635:
“The references to ‘usual place of abode’ of course, and to ‘resides’ refer to the residential address of Mr Stanton.”
That is not the expression which is used in the relevant provision. As Mr Skinner points out, for the judgment creditor, the relevant expression is:
“The last known address of the person and it does not matter when the debtor currently lives or resides there or not. The expression is difficult on one view, in the sense that it does not indicate to whom the address must be known in order to satisfy the requirements of the person. On one view of it, it could be taken to be the knowledge of the creditor. Alternatively, as advanced by Mr Skinner, the words could mean the last known address of the person in an objective sense, namely, that address at which the debtor is said to be located.”
The evidence is clear that Mr Hakan Atmali can be located at 256 Chisholm Street, Auburn. It is from there that his business operates. He told the Court that even though he had moved from those premises some 10 years ago he never sought to advise the ATO of that fact, nor did he advise his accountant of that fact.
A similar argument, as raised by Mr Hakan Atmali, was raised before me in Magafas v Carantinos [2008] FMCA 1654 where the debtor did not reside at the address at which service was effected. But in that case service took place at an address used by the debtor for business purposes and was regularly visited by his mother and there was evidence that documents sent to him at that address were received. This seems to me to be a similar case and so I am satisfied that for the purposes of these proceedings the last known address of Mr Hakan Atmali was 256 Chisholm Street, Auburn and that the bankruptcy notice was therefore effectively served upon him. This being the case the only ground upon which the notice of opposition was argued (there originally being five in all) of Mr Hakan Atmali has failed and having gone through the usual processes I am satisfied that the respondent committed the act of bankruptcy alleged in the petition.
I make a Sequestration Order against the estate of Hakan Atmali. The Applicant Creditor’s costs (including any reserved costs) be fixed in the amount of $3,113.80 and be paid from the estate of the Respondent Debtor in accordance with the Act. Under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Receiver in Sydney within 2 days. The Court notes that the date of the act of bankruptcy is 30 July 2012.
In respect of Mr Hasan Atmali the four grounds of objections in the notice were not argued and it was not said that he had not been served. In regard to him I am satisfied that he committed the act of bankruptcy alleged in the petition.
I make a Sequestration Order against the estate of Hasan Atmali. The Applicant Creditor’s costs (including any reserved costs) be fixed in the amount of $2,993.80 and be paid from the estate of the Respondent Debtor in accordance with the Act. Under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Receiver in Sydney within 2 days. The Court notes that the date of the act of bankruptcy is 30 July 2012.
I certify that the preceding sixteen (16) paragraphs are a true copy of the reasons for judgment of Judge Raphael
Date: 12 June 2013
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