Farrell v The Owners - Strata Plan No 64984 - [2012] FMCA 999

FEDERAL MAGISTRATES COURT OF AUSTRALIA

FARRELL v THE OWNERS - STRATA PLAN NO 64984

[2012] FMCA 999

BANKRUPTCY – Application to review sequestration order made by a registrar – extension of time – service of originating process in proceedings leading to judgment on which bankruptcy notice was based – service of creditor’s petition.

Bankruptcy Act 1966 (Cth), ss.52, 153B
Bankruptcy Regulations 1996 (Cth), reg.16.01
Strata Schemes Management Act 1996 (NSW)
Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth), r.203

Uniform Civil Procedures Rules 2005 (Cth), r.10.20

Australia & New Zealand Banking Group Pty Ltd v Foyster [2000] FCA 400
Ferella v Otvosi (2006) 197 FLR 451; [2006] FMCA 334
Grundy v Wattyl Australia Pty Ltd [2002] FCA 1480
Rafaraci v Pearce & Heers [2003] FCA 1307
Re Papps; Ex parte Tapp (1997) 78 FCR 524; [1997] FCA 1031
Re Sanders; Knudsen and Yates (t/a The Hargreaves Practice) v Sanders (2003) 1 ABC(NS) 408; [2003] FCA 1079
Sandell v Porter and Another (1966) 115 CLR 666; [1966] HCA 28

Skalkos v T & S Recoveries Pty Ltd (2004) 141 FCR 107; [2004] FCAFC 321

T & SRecoveries Pty Ltd v Skalkos, in the matter of Skalkos [2004] FCA 816

Applicant:

DAVID HENRY FARRELL

Respondent:

THE OWNERS - STRATA PLAN NO 64984

File Number:

SYG 667 of 2012

Judgment of:

Barnes FM

Hearing date:

8 October 2012

Delivered at:

Sydney

Delivered on:

8 October 2012

REPRESENTATION

Applicant:

In person

Solicitor for the Respondent:

David Le Page, Solicitor

ORDERS

The application for review filed on 8 August 2012 is dismissed.
The sequestration order made on 20 June 2012 in relation to the estate of David Henry Farrell is affirmed.
The applicant creditor’s costs of the sequestration order made on 20 June 2012 of $6,962.37 be paid from the estate of the respondent debtor.
The creditor’s costs of the application for review filed on 8 August 2012 be taxed and paid from the estate of the bankrupt in accordance with the Bankruptcy Act 1966 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT SYDNEY

SYG 667 of 2012

DAVID HENRY FARRELL

Applicant

And

THE OWNERS – STRATA PLAN NO 64984

Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

This is an application for review of a sequestration order made by a registrar of this court on 20 June 2012 in the absence of the debtor, Mr Farrell, who is the applicant for review. The sequestration order was made on the application of the petitioning creditor, The Owners of Strata Plan No 64984.
Mr Farrell filed the application for review of the sequestration order on 8 August 2012. He sought an extension of time because his application was not brought within the 21 day time limit for review of sequestration orders made by a registrar of this court (see r.2.03 of the Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth).
In support of his application for an extension of time and review Mr Farrell relied on an affidavit sworn by him on 8 August…

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.

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Details

Case: [2012] FMCA 999
Decision Date: 8 October 2012

CaseChat Overview and Summary

The case before the court involved a dispute between a creditor, Farrell, and the trustee of a bankrupt estate, David Henry Farrell. The trustee, who was represented by Strata Plan No 64984, sought a review of a sequestration order made against the bankrupt, David Henry Farrell, on 20 June 2012. The application for review was filed on 8 August 2012. The matter was heard in the Federal Circuit Court of Australia.

The primary legal issues for the court to determine were whether the sequestration order should be affirmed, and if the costs associated with the order and the review application should be borne by the estate of the bankrupt. The court had to consider the provisions of the Bankruptcy Act 1966 (Cth) and any relevant case law to ascertain the appropriate course of action.

The court found that the application for review was without merit and dismissed it. The court affirmed the sequestration order made against David Henry Farrell, ruling that the bankrupt had not provided sufficient evidence to challenge the order. The court also ordered that the costs of the sequestration order be paid from the estate of the bankrupt. Furthermore, the court directed that the costs of the application for review be taxed and paid from the bankrupt's estate in accordance with the provisions of the Bankruptcy Act 1966 (Cth).

The court's final orders were that the application for review be dismissed, the sequestration order be affirmed, the costs of the sequestration order be paid from the estate of the bankrupt, and the costs of the application for review be taxed and paid from the estate of the bankrupt.

Orders

Orders of the court

The application for review filed on 8 August 2012 is dismissed.

The sequestration order made on 20 June 2012 in relation to the estate of David Henry Farrell is affirmed.

The applicant creditor’s costs of the sequestration order made on 20 June 2012 of $6,962.37 be paid from the estate of the respondent debtor.

The creditor’s costs of the application for review filed on 8 August 2012 be taxed and paid from the estate of the bankrupt in accordance with the Bankruptcy Act 1966 (Cth).

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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