Egan v Oa**Regan
[2008] FMCA 234
•26 February 2008
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| EGAN & ANOR v O'REGAN | [2008] FMCA 234 |
| BANKRUPTCY – Application for appointment of trustee under s.50 of the Act or property preservation order – where debtor resides in the Philippines – where evidence indicates attempts to sell properties – where debtor’s address in Philippines is known and where his son to whom property has been transferred resides in NSW – whether property preservation order is more appropriate. |
| Bankruptcy Act 1966, s.50 |
| Applicants: | ANTHONY ROY EGAN & JOY ELIZABETH EGAN |
| Respondent: | DENNIS JAMES O'REGAN |
| File number: | SYG 442 of 2008 |
| Judgment of: | Raphael FM |
| Hearing date: | 26 February 2008 |
| Date of last submission: | 26 February 2008 |
| Delivered at: | Sydney |
| Delivered on: | 26 February 2008 |
REPRESENTATION
| Counsel for the Applicant: | Mr B De Buse |
| Solicitors for the Applicant: | Reimer Winter Williamson |
ORDERS
That pursuant to s.50 of the Bankruptcy Act 1966, Bruce Gleeson a registered trustee, take control of the property of the respondent debtor, Dennis James O’Regan, until further order.
The respondent debtor, Dennis James O’Regan, be restrained, without prior approval of the court, from paying, lending or depositing any monies with, or transferring or delivering any property to, any person, company or entity.
The respondent debtor, Dennis James O’Regan, be restrained without the prior approval of the Court, from transferring, sending, or taking moneys or other property out of Australia.
Without limitation or orders 2 and 3:
4.1The respondent debtor be restrained either by himself or by his servants or agents from selling, mortgaging or otherwise dealing with or disposing of or permitting to be sold, charged, mortgaged or otherwise dealt with or disposed of, all or any of his assets within the Australia and including, but not limited to the following properties:
(a)Folio A/321238
(b)Folio B/321238
(c)Folio 4/2/3552
(d)Folio 21/1/3552
(e)Folio 25/1/3552
(f)Folio 26/1/3552
(g)Folio 27/1/3552
(h)Folio 5/663646B
(i)5/663646A
4.2The respondent debtor, Dennis James O’Regan, be restrained by himself and by his servants or agents from withdrawing any moneys from any accounts held with a bank or other financial institution.
Service of the application and these orders may be effected by:
Delivery of a sealed copy to any person apparently over the age of sixteen years at 60 Albion Street, Katoomba, NSW; and by sending on or before 1 March 2008 by prepaid ordinary post a sealed copy of the application to the respondent at:
(a)60 Albion Street Katoomba
(b)Joe Ree’s at 12 Macquarie Avenue, Penrith, NSW 2152
(c)c/- EE’ Eatery, Corner Dr Logan Drive and Kasadja Street, Dumagete City, Negros Oriental, Phillipines
(d)By facsimile to 0063 354222617
The application is stood over to 19 March 2008 at 9.30a.m.
The parties to have liberty to apply on 48 hours notice.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 442 of 2008
| ANTHONY ROY EGAN & JOY ELIZABETH EGAN |
Applicants
And
| DENNIS JAMES O'REGAN |
Respondent
REASONS FOR JUDGMENT
In this matter there is an application drafted in the alternative for orders pursuant to s.50 of the Bankruptcy Act 1966 (the “Act”) being the appointment of a registered trustee to take control of the property of the respondent debtor or for an asset preservation order in terms of paragraph two, three and four of the application.
It would appear from the affidavit of Neil Williamson filed in this case and the documents exhibited thereto that the applicants are the holders of a Certificate of Judgment in excess of $200,000.00 obtained out of the District Court of New South Wales on 16 November 2007. The debtor did not appear at the hearing of the case and has now departed Australia and appears to be living in the Philippines. Needless to say, he has proved difficult to contact or communicate with.
The creditors have made certain investigations concerning the assets of the debtor against whom they have now issued, and served by way of substituted service, a bankruptcy notice. The fact of the issue of a bankruptcy notice provides them with the ability to make the application under s.50.
The evidence reveals that the debtor is the owner of some properties in the Blue Mountains which have been put up for sale. The evidence also reveals that on 3 December 2007 the debtor purported to transfer to a person, believed to be his son, certain properties for a consideration expressed to be $45,000.00. The applicants submit that the affidavit and the transfer provides sufficient evidence that the debtor is attempting to dispose of his assets and possibly to take the proceeds of sale into his possession in the Philippines.
The appointment of a trustee under s.50 is a very serious matter. And the difficulty which I have in this case with approving the application is that at the present time no bankruptcy petition has been issued or served and I am concerned that the trustee may be put in a position of holding assets in the name of the debtor for some considerable time and at considerable cost to his creditors. On the other hand, the asset preservation order requested seems to me to be sufficient to protect the current situation. I note particularly that some of the properties alleged to be owned by the debtor are mortgaged and therefore they may not have much in the way of residual value. This would add to the concern expressed about the expense involved in appointing a trustee.
The applicants have provided the court with short minutes of order relating to the asset preservation order which indicates an address in the Philippines at which the documentation can be served and also an address in Katoomba which the affidavit indicates is occupied by the debtor's son. So I am satisfied that the asset preservation order will come to the notice of the debtor. If a bankruptcy petition is filed and leave is given to effect substituted service of that document then the court might reconsider the question of a s.50 order if additional evidence comes to light concerning assets of the debtor which are not covered by the asset preservation order that I propose to make.
I make orders in accordance with the short minutes initialled by me and placed with the papers. The application is stood over to 19 March 2008 at 9.30 am.
I accept from the applicants through their counsel the usual undertakings as to damages.
I certify that the preceding eight (8) paragraphs are a true copy of the reasons for judgment of Raphael FM
Associate:
Date:
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