Franks v Warringah Council

Case [2003] FCA 1047

FEDERAL COURT OF AUSTRALIA

Franks v Warringah Council, in the matter of Franks [2003] FCA 1047

BANKRUPTCY – application to set aside bankruptcy notices – whether bankruptcy notices are defective because they are not founded upon a final judgment or order as required under the Bankruptcy Act 1966 (Cth) - whether unquantified costs order of the New South Wales Land and Environment Court together with a certificate issued under s 208J of the Legal Profession Act 1987 (NSW) is a final judgment or order – whether it is possible to have two final judgments in respect of the one debt.

Bankruptcy Act 1966 (Cth) ss 40, 41, 306
Land and Environment Court Act 1979 (NSW) s 69
Legal Profession Act 1987 (NSW) ss 208F, 208J, 208K
Supreme Court Rules 1970 (NSW) Part 44 r 7(1)

Abigroup Limited v Abignano (1992) 39 FCR 74 cited
Australian Steel Company (Operations) Pty Ltd v Lewis (2000) 109 FCR 33 cited
Commonwealth Bank of Australia v Horvath (Junior) (1999) 161 ALR 441 considered
Croker v Commissioner of Taxation (2003) 52 ATR 226 cited
Economic Life Assurance Society v Usborne [1902] AC 147 cited
In re A Debtor; Ex parte The Debtor v Scott [1954] 1 WLR 1190 considered
In re Cartwright; Ex parte Cartwright v Barker [1975] 1 WLR 573 considered
Kerin v Deputy Commissioner of Taxation (2001) ATR 423 considered
Minister Administering the Environmental Planning and Assessment Act 1979 v Carson (1994) 35 NSWLR 342 cited
Re Pannowitz; Ex parte Wilson (1975) 38 FLR 184 cited
Stec v Orfanos [1999] FCA 457 (FC) considered
Wilmot v Buckley (1984) 2 FCR 540 referred to

PHILLIP MAURICE FRANKS v WARRINGAH COUNCIL IN THE MATTER OF PHILLIP MAURICE FRANKS

N 7022 of 2003
N 7023 of 2003
N 7024 of 2003

BRANSON J
2 OCTOBER 2003
SYDNEY


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 7022 of 2003

IN THE MATTER OF PHILLIP MAURICE FRANKS

BETWEEN:

PHILLIP MAURICE FRANKS
APPLICANT

AND:

WARRINGAH COUNCIL
RESPONDENT

JUDGE:

BRANSON J

DATE OF ORDER:

2 OCTOBER 2003

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.The bankruptcy notice be set aside.

2.The respondent pay the applicant’s costs


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 7023 of 2003

IN THE MATTER OF PHILLIP MAURICE FRANKS

BETWEEN:

PHILLIP MAURICE FRANKS
APPLICANT

AND:

WARRINGAH COUNCIL
RESPONDENT

JUDGE:

BRANSON J

DATE OF ORDER:

2 OCTOBER 2003

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.The bankruptcy notice be set aside.

2.The respondent pay the applicant’s costs


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 7024 of 2003

IN THE MATTER OF PHILLIP MAURICE FRANKS

BETWEEN:

PHILLIP MAURICE FRANKS
APPLICANT

AND:

WARRINGAH COUNCIL
RESPONDENT

JUDGE:

BRANSON J

DATE OF ORDER:

2 OCTOBER 2003

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.The bankruptcy notice be set aside.

2.The respondent pay the applicant’s costs


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 7022 of 2003
N 7023 of 2003
N…

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AGLC
Franks v Warringah Council [2003] FCA 1047
Case
[2003] FCA 1047
Decision Date

CaseChat Overview and Summary

Franks v Warringah Council was a case heard by the Supreme Court of New South Wales. The dispute involved bankruptcy notices issued by Warringah Council against Franks, claiming interest on the debts. The notices were based on judgments from the Land & Environment Court and included certificates of determination of costs issued by a costs assessor under the Legal Profession Act. Franks challenged the validity of these bankruptcy notices, arguing that the notices did not correctly identify the provisions under which interest could be claimed, and that the interest calculations did not account for fees paid for the assessment of costs.

The court had to decide whether the bankruptcy notices correctly identified the provision under which interest could be claimed, and if the interest was calculated correctly. It also had to determine whether the certificates of determination of costs were filed in a court of competent jurisdiction, as required by the Legal Profession Act.

The court found that the bankruptcy notices did not correctly identify the provision under which interest could be claimed and that the interest calculations were incorrect because they did not account for fees paid for the assessment of costs. The court concluded that it was not appropriate to determine the interest that might have been claimed had the creditor done so correctly. The court also found that it was unable to be satisfied whether the certificates of determination of costs were filed in a court of competent jurisdiction. As a result, the court set aside the bankruptcy notices and ordered Warringah Council to pay Franks' costs.

Orders

Orders of the court

1. The bankruptcy notice be set aside.

2. The respondent pay the applicant’s costs

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

BRANSON J
In the case of the bankruptcy notices in N 7022 of 2003 and N 7023 of 2003 interest is claimed. In each case the provision under which the interest is claimed is identified as s 69A(1) of the L & E Court Act. In each case the interest is calculated from the date of the relevant order of the Land & Environment Court. In neither case is allowance made for the fact that the determination of the costs assessor included fees paid in respect of the application for the assessment of costs (s 208F(4) of the Legal Profession Act). The conclusion that I have reached in [32] above dictates the conclusion that the bankruptcy notices in N 7022 of 2003 and N 7023 of 2003 do not identify the provision under which interest could appropriately be claimed. In the circumstances I do not consider it appropriate to determine the interest that might validly have been claimed had the creditor claimed interest in reliance upon s 208J(3) of the Legal Profession Act.CONCLUSION On each application there will be an order that the bankruptcy notice be set aside. The respondent must pay the applicant’s costs of the applications.

Ratio Decidendi

Legal Principle Established

Established by: BRANSON J

Part 44 r 7(1) of the Supreme Court Rules 1970 (NSW) provides:‘(1) A person requiring the issue of a writ of execution shall ‑(a)produce to the registrar a form of the writ; (b)file a copy of the writ; and (c)where the writ is to enforce a judgment for the payment of money, file an affidavit, sworn not more than 14 days before the requirement, containing and verifying a statement of: (i) the date of taking effect of the judgment; (ii)the amount of money originally payable under the judgment; (iii)the date and amount of each payment made on account of the judgment; (iiiA)the date and amount of each payment made on account of costs or expenses recoverable under section 107(1) of the Service and Execution of Process Act;(iv)the interest (if any) due on the date of swearing of the affidavit;(v)such other particulars as are necessary to calculate the amount payable under the judgment on the date of swearing of the affidavit; (vi)the amount payable under the judgment on the date of swearing of the affidavit; and (vii)the daily amount of interest (if any) which (subject to any future payment on account of the judgment) will accrue after the date of swearing of the affidavit, and containing and verifying a statement ‑ (viii)that the judgment was not entered as a result of the filing of a certificate under section 208J(3) or section 208JA(4) or section 208KF(2)(b) or section 208KH(6) of the Legal Profession Act 1987; or (ix)that the judgment was entered as a result of the filing of a certificate under section 208J(3) or section 208JA(4) or section 208KF(2)(b) or section 208KH(6) of the Legal Profession Act 1987 and that the determination which the certificate sets out is not subject to any suspension under: (A)section 208N(1) of that Act which has not been ended under section 208N(2), or (B)section 208KE(1) of that Act which has not been ended under section 208KE(2).’CONSIDERATIONFinal Judgment or Final Order The Bankruptcy Act provides that a bankruptcy notice must be in accordance with the form prescribed by the regulations (s 41(2)). The form prescribed by the regulations requires the creditor relevantly to specify the amount of the debt that is due to the creditor ‘as shown in the Schedule’ and to attach to the notice a copy of the judgment or order relied upon (see regulation 4.02 of the Bankruptcy Regulations 1996 and Form 1). The Schedule to Form 1 allows for the specification of three separate sums:(a)the amount of the judgment or order;(b)the legal costs if ordered to be paid and a specific amount was not included in the judgment or order; and(c)if claimed, interest accrued since the date of the judgment or order. Note 1 to the Schedule reads as follows:‘If legal costs are being claimed in this Bankruptcy Notice, a certificate of taxed or assessed costs in support of the amount claimed must be attached to this Bankruptcy Notice.’ As is mentioned above, each of the three bankruptcy notices has attached to it a certificate issued by a costs assessor pursuant to s 208J of the Legal Profession Act. Each certificate sets out the determination of the costs assessor as to the costs payable as a result of the order of the Land & Environment Court upon which that bankruptcy notice is based. None of the bankruptcy notices discloses whether the certificate so issued has been filed in the office or registry of a court having jurisdiction to order the payment of the amount of the determination of the costs assessor (see s 208J(3)) of the Legal Profession Act). Mr Franks, however, has placed in evidence a copy letter from the Council’s solicitors to the Registrar of the Local Court which states:‘We act for the Applicant and we enclose for filing a Certificate as to Determination of Costs in the sum of $17,592.32.Please confirm that the certificate is registered as a Judgment and advise of the relevant number.We enclose a cheque in the sum of $51.00 being the filing fee of the certificate.’I conclude on the balance of probabilities, having regard to the reference in the letter to the sum of $17 592.32, that the certificate as to determination of costs annexed to the bankruptcy notice the subject of the application in N 7024 of 2003 has been filed in a court of competent jurisdiction. There is no evidence before me as to whether the certificates annexed to the other bankruptcy notices have respectively been filed in courts of competent jurisdiction. I am therefore unable positively to be satisfied that these respective certificates either have been or have not been filed in a court of competent jurisdiction.