Gadelrabb v Liristis
[2012] FMCA 318
•11 April 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| GADELRABB v LIRISTIS | [2012] FMCA 318 |
| BANKRUPTCY – Review of decision of Registrar – application to set aside sequestration order – whether Creditor’s Petition served on respondent – whether correct documents served on respondent – application allowed. PRACTICE AND PROCEDURE – Costs – whether expenses should be awarded. |
| Federal Magistrates Court (Bankruptcy) Rules 2006 Bankruptcy Act 1966 (Cth) Federal Magistrates Act1999 (Cth) s.104(3) |
| Applicant: | JULIA GADELRABB |
| Respondent: | TONY LIRISTIS |
| File Number: | SYG 2760 of 2011 |
| Judgment of: | Raphael FM |
| Hearing date: | 11 April 2012 |
| Date of Last Submission: | 11 April 2012 |
| Delivered at: | Sydney |
| Delivered on: | 11 April 2012 |
REPRESENTATION
| Counsel for the Applicant: | Mr P. Webb |
| Solicitors for the Applicant: | Meridian Legal |
| For the Respondent: | In person |
ORDERS
The application for review of the decision of District Registrar Wall dated 7 February 2012 be allowed pursuant to s.104(3) of the Federal Magistrates Act 1999.
Sequestration Order set aside.
Applicant to substantive proceedings to pay the sum of $250.00 to Mr Paul Seufatu for expenses of appearing in court.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2760 of 2011
| JULIA GADELRABB |
Applicant
And
| TONY LIRISTIS |
Respondent
REASONS FOR JUDGMENT
Was Mr Liristis served with a bankruptcy petition on 8 December 2011? If he was served, was he served with all the documents required by Rule 4.05 of the Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth)? These are the questions that I have to answer in this application for review of a decision of Registrar Wall who made a sequestration order against the estate of Tony Liristis on 7 February 2012.
Mr Liristis sought review of that decision on 2 March 2012 by way of application to this court. He alleged that he had not been served with the petition and in support of his claim, he produced an affidavit of his own together with affidavits from Mr Paul Seufatu, Vicki Tsesmetzis and Tasos Liristis. In the event, as neither Ms Tsesmetzis nor Mr Tasos Liristis were available for cross-examination, their affidavits were not read. The respondents relied on two affidavits by the process servers employed by Wise McGrath: Mr Smith and Mr McGinty.
It is not in dispute that on 8 December 2012 the parties attended in the Supreme Court of New South Wales before Young J at 9:00 am. Mr Liristis’ evidence is that he brought with him, in a motor vehicle driven by his father, Mr Seufatu and Ms Tsemetzis. He says that he was dropped outside the Court and went up to the twelfth floor with Mr Seufatu. After the application had been dealt with by his Honour, Mr Liristis says that he and Mr Seufatu went to the lift and went downstairs. Mr Liristis told Mr Seufatu that he was going to see the Judicial Registrar on level five and asked Mr Seufatu to go to the car and tell his father that he might be a while. He says that he did this and that after a period of time, Mr Seufatu came back to level five and they then, together, went downstairs, left the building at the Macquarie Street entrance, went straight into the car and drove away.
The evidence of Mr McGinty was that he was initially instructed to serve the petition on Mr Liristis, whom he said he knew from previous attempts at service of other documents. He saw Mr Liristis in the confines of the Court. He thought that Mr Liristis recognised him. He saw that Mr Liristis went away and, being of the view that he could not serve Mr Liristis within the confines of the Court, telephoned his colleague Mr Smith and asked him to come down; they met at approximately 10.30 am. Mr Smith says that Mr McGinty pointed out Mr Liristis, who was standing inside the reception area on the ground floor of the Court. Mr Smith then waited around until Mr Liristis came out of the building and attempted to serve him.
Mr Smith called out, “Are you Tony Liristis?” Mr Liristis is alleged to have replied “Yes”, Mr Smith said to him “I have a letter and a creditor’s petition for you”, Mr Liristis is alleged to have replied “Nah mate, that’s not me”. Mr Smith says he tried to hand the documents to Mr Liristis but Mr Liristis would not accept them. He then said “You have been identified to me as Tony Liristis, I am serving this creditor’s petition on you by leaving it in your presence”, he then placed the documents down and said “You have been served”. There was produced in evidence, exhibit 2, a photograph of a piece, or pieces, of white paper lying on herringbone pavers, which I shall take judicial notice of as being outside the Supreme Court; the photograph clearly showing the renovations and the buildings in Macquarie Street that I am able to recognise from my thirty years of practice in New South Wales.
A review of a Registrar’s decision is a hearing de novo and thus all the obligations that were upon a creditor remain upon that creditor, including the obligation to establish service. It is not for Mr Liristis to prove that he was not served; it is for the creditor to prove that Mr Liristis was.
Mr Liristis and Mr Seufatu gave evidence that on the day on question Mr Liristis was wearing a black jacket and trousers and a skivvy of some sort, probably black. Importantly, Mr Liristis was bandaged around his head, as a result of a “bashing” that he had received some time prior. It was not suggested, in cross-examination of Mr Seufatu or of Mr Liristis, that he was not so bandaged. When the two process servers gave their evidence, they were both asked whether they saw anything unusual about Mr Liristis at the time and neither of them made reference to the bandage. Indeed they both made reference to Mr Liristis’ hair and the colouring of it. There was also a discrepancy between their descriptions of what Mr Liristis wore, although both agreed that whatever it was, it was black.
The evidence of Mr Seufatu was that quite some time had expired between him going down in the lift from level twelve and going back to level five to pick up Mr Liristis. He thought that this went on till about 12:30pm. On the other hand, the process servers deposed to the fact that the service took place at about 10:30am. Mr Seufatu was cross-examined on his evidence. He revealed that he had voluntarily agreed to act as a bodyguard, from time to time, of Mr Liristis who was concerned for his safety after the bashing, but that he was not paid for this service.
I saw Mr Seufatu in the witness box and there is nothing in his questioning or cross-examination which would lead me to have concerns about his evidence. On the other hand, the matters that I have referred to in the evidence of Mr Smith and Mr McGinty do cause me some concern because I am satisfied that Mr Liristis had a bandage on his head at the time. The end result of all this is that I am not satisfied, to the required standard, that Mr Liristis was served with the documents. As Mr Liristis suggested in his submissions, there are a number of explanations as to how the photograph came into being and for what purpose, but it does not behove this Court to speculate.
In the event that it should be thought that I was wrong in coming to the conclusion that I have just stated, I would also like to deal with the question of service of documents required under R.4.05. Rule 4.05 is in the following form:
“Unless the Court otherwise orders, at least 5 days before the date fixed for the hearing of a creditor’s petition, the applicant creditor must serve on the respondent debtor:
(a) the creditor’s petition; and
(b) a copy of the affidavit, or affidavits, verifying the petition required by subsection 47 (1) of the Bankruptcy Act; and
(c) if applicable, a copy of the affidavit required by paragraph 4.04 (1) (a); and
(d) if applicable, a copy of the affidavit of service of the bankruptcy notice required by paragraph 4.04 (1) (b); and
(e) a copy of any consent to act as trustee filed under section 156A of the Bankruptcy Act.”
It is usual when a bankruptcy petition is served that there is served the petition and then, in another document, an affidavit of service of the bankruptcy notice, the notice itself and the accompanying documents. These documents did not form part of the affidavit of service of Mr Smith, who says that he served Mr Laristis “with a letter from Meridian Legal dated 5 December 2011, a true copy of which is annexed and marked A, and the original sealed copy of the creditor’s petition, the true copy of which is annexed and marked B”.
Mr McGinty’s evidence does not assist in any way in telling us what documents were served. Ms Abood, who is the solicitor for the respondent, also filed an affidavit, but only paragraph 21 was read. That paragraph says:
“Shortly after filing of the Creditor’s Petition, I attended the offices of Wise McGrath and hand delivered the sealed Creditor’s Petition and instructed them to serve Tony Liristis personally on 8 December 2011 outside the Queens Square Court Complex. Annexed hereto and marked with the letter ‘o’ is a true copy of the affidavit of service by Joshua Smith.”
Annexure O purports to contain 12 pages. The first page is the affidavit of service, which I have previously referred to and I am told that in the original copy the other ten pages consist of the letter and other documents including the documents required by R.4.05.
Mr Webb, who appears on behalf of the respondent and has been more than patient with Mr Liristis’ personal appearance, has provided considerable assistance to the Court. He has acted as fairly as one would expect from a legal representative of his seniority in dealing with a self represented litigant, asks me to make an inference that all documents required were served and he asks me to do that on the basis on Ms Abood’s unchallenged evidence.
I am afraid that I cannot do so. Firstly because I do not believe that Ms Abood’s unchallenged evidence goes any further than the words used, which is that she delivered the sealed creditor’s petition and instructed Wise McGrath to serve Mr Liristis. And secondly, because the evidence of Mr Smith was that the only documents he served were the documents referred to in his affidavit. He explained how process servers usually deal with these matters. They know they have to swear an affidavit as to what they served so they take a copy or sometimes make a list of the documents which are to be served and then, when they return to their offices, they use that as an aide memoire to the creation of the affidavit. Mr Smith was firm in his view that the only documents referred to in that aide memoire were the petition and the letter.
That is the status of the evidence as it came before me today. If I was asked, I would be of the view that the applicant creditor cannot satisfy the Court that the documents required to be served under R.4.05 were served.
Mr Webb asks that the court exercises its discretion not to set aside the sequestration order. He says that this is a debt for costs, independent of the current proceedings between the parties and that it has not been paid. Mr Liristis tells me that his major action against the applicant is due back in the Supreme Court, Court of Appeal, in a few days time and that if I do not set aside the sequestration order, he will be unable to continue with the action because his trustee will refuse to take it on.
I have not heard from the trustee although I’m satisfied that he was served with notice of these proceedings as required by the Rules. I have, in an earlier proceeding, been made aware of the complex nature of the case that Mr Liristis is bringing by way of an appeal. It involves the interpretation of certain New South Wales statutes relating to tenancy matters upon which I can claim no expertise. But I would be reluctant to prevent Mr Liristis from an opportunity to make his submissions to that Court. Whilst Mr Liristis may be a man of considerable passion, he has conducted this case with an apparent understanding of the requirements of the Bankruptcy Act 1966 (Cth) and I would anticipate that in the Court of Appeal proceedings he will be equally articulate and knowledgeable.
For those reasons, I do not propose to exercise my discretion not to set aside the sequestration order. I am not aware of any other creditors of Mr Liristis, and whilst the amount owed to this applicant is not small, it is certainly not overwhelming.
The orders I will make are that pursuant to s.104(3) of the Federal Magistrates Act1999 (Cth), the sequestration order shall be set aside. I do not propose to dismiss the petition. If that petition is served properly, with all the requisite documentation, then it can be heard in the proper manner. If at that time, Mr Liristis has anything to say as to why the petition should not be granted, he can be heard.
Mr Liristis is a litigant in person and in those circumstances no order for costs will be made. I do, however, propose to make an order that the applicant pay Mr Seufatu the sum of $250.00 for his expenses of appearing in Court.
I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of Raphael FM
Date: 19 April 2012
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