Gleeson as trustee of the Property of Saker (A Bankrupt) v Saker (A Bankrupt)

[2017] FCCA 568

FEDERAL CIRCUIT COURT OF AUSTRALIA

GLEESON AS TRUSTEE OF THE PROPERTY OF SAKER (A BANKRUPT) v SAKER (A BANKRUPT) [2017] FCCA 568

Catchwords:
BANKRUPTCY – Ex parte application – where personal service is dispensed with – where damages are an inadequate remedy – injunctive relief granted.

Legislation:

Bankruptcy Act 1966 (Cth), s.27.

Applicant: BRUCE GLEESON AS TRUSTEE OF THE PROPERTY OF JASON GABRIEL SAKER (A BANKRUPT)

Respondent: JASON GABRIEL SAKER (A BANKRUPT)

File Number: SYG 865 of 2017

Judgment of: Judge Street

Hearing date: 23 March 2017

Date of Last Submission: 23 March 2017

Delivered at: Sydney

Delivered on: 23 March 2017

REPRESENTATION

Counsel for the Applicant: Mr P A Parsons

Solicitors for the Applicant: CLH Lawyers

ORDERS

1. The Application be returnable before the Court instanter.

2. The Respondent to appear in person before this Court at 9:30 A.M. on 27 March 2017:

   (a)to give evidence as to his financial affairs;

   (b)to produce all keys for the access and entry to Lot 134 in Deposited Plan 32148 situated and known as 50 Shane Park Road, Shanes Park NSW 2747 and all keys for any buildings, sheds, or any containers thereon in his possession or in the possession of any agent on his behalf; and

   (c)to produce all original invoices, delivery receipts, log sheets, statements of account, receipts of payment and records as to payment relating to the dumping or placing of waste or fill or other material on the land known as 50 Shane Park Road, Shanes Park NSW 2747 from 29 August 2016 to date.

3. The time for service of this Application be abridged to 6pm on 23 March 2017.

4. Personal service of this Application be dispensed with.

5. This Application may be served by:

   (a)leaving a sealed copy of this Application together with a sealed copy of the affidavit of Bruce Gleeson sworn on 22 March 2017 and a copy of the orders made by this Court on 23 March 2017 in the letterbox at 50 Shane Park Road, Shanes Park NSW 2747; and

   (b)affixing to the front gate at 50 Shane Park Road, Shanes Park NSW 2747 a sealed copy of this Application together with a sealed copy of the affidavit of Bruce Gleeson sworn on 22 March 2017 and a copy of the orders made by this Court on 23 March 2017 in an envelope addressed to the Respondent.

6. Pursuant to section 30(5)(a) and (c) of the Bankruptcy Act 1966 (Cth) (“the Act”) until further Order, that the Respondent, Jason Gabriel Saker, cease:

   (a)dumping or placing waste, fill or other material on the land comprised in Lot 134 in Deposited Plan 32148 situated and known as 50 Shane Park Road, Shanes Park NSW 2747 (“the Land”);

   (b)causing, permitting or suffering the placing of waste, fill or other material on the Land; and

   (c)causing, permitting or suffering any person or motor vehicle not authorised by the Applicant to enter or remain upon the Land.

7. Pursuant to section 30(1)(b) of the Act that the Respondent appear before this Court on 27 March 2017 and show cause why he should not be dealt with pursuant to section 30 or 78 of the Act due to his:

   (a)failure to file his Statement of Affairs with the Official Receiver pursuant to section 54(1) of the Act and after written requirements by the Applicant dated 24 February 2016 and 31 March 2016 that he do so;

   (b)failure to deliver a copy of his passport to the Applicant pursuant to section 77(1)(a)(ii) of the Act after a written requirement by the Applicant dated 24 February 2016 and 31 March 2016 that he do so;

   (c)failure to attend the Applicant as required pursuant to section 77(1)(b) of the Act after a requirement made by the Applicant on 26 April 2016 that he do so;

   (d)failure to provide details of the motor vehicles in his possession to the Applicant pursuant to section 77(1)(ba) of the Act after a written requirement by the Applicant dated 31 March 2016 that he do so;

   (e)failure to deliver vacant possession of the Land to the Applicant pursuant to section 77(1)(e) of the Act after written requirements by the Applicant dated 24 August 2016 and 14 September 2016 that he do so; and

   (f)failure to cease landfill activity on the Land and restore the Land pursuant to section 77(1)(e) of the Act after a written requirement by the Applicant dated 19 December 2016 that he do so.

8. The Court dispenses with the ordinary requirement of an undertaking as to damages by the applicant.

9. Costs of today be reserved.

   THE COURT NOTES THAT A WARRANT WILL ISSUE:

   If the Respondent fails to comply with Order 2 and to attend this Court in court room 9.1 on level 9 at 80 William Street, Sydney, in person on 27 March 2017 at 9:30 A.M. a warrant will issue for the respondent’s arrest pursuant to r.29.06 of the Federal Circuit Court Rules 2001 and that pursuant to r.29.07 of the said rules, if the Respondent fails to comply with Order 2, the Court may make an Order of committal, sequestration, or punishment for contempt.

   THE COURT NOTES THE FOLLOWING ENDORSEMENT

   Following compliance with the steps taken for service of the Order, the Respondent will be liable to imprisonment, sequestration of property and punishment for contempt if :

   (a) Respondent fails to comply with Order 2 or neglects or refuse to comply with Order 2; or

   (b) if the Respondent fails to comply with Order 6 or disobeys Order 6.

THE COURT FURTHER NOTES THAT:

Subsection 104(2) of the Federal Circuit Court of Australia Act 1999 (the Act) provides that a party to proceedings in which a Registrar has exercised any of the powers of the Court under subsection 102 (2), or under a delegation under subsection 103 (1) of the Act may, within the time prescribed by the Rules of Court, or within any further time allowed in accordance with the Rules of Court, apply to the Court to review that exercise of power.

Rule 2.03 of the Federal Circuit Court (Bankruptcy) Rules 2006 provides that, subject to any direction by the Court or a Federal Magistrate to the contrary, an application under subsection 104 (2) of the Act for review of the exercise of a power of the Court by a Registrar under subsection 102 (2), or under a delegation under subsection 103 (1), of the Act must be made by application for review within 21 days after the day on which the power was exercised.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 865 of 2017

BRUCE GLEESON AS TRUSTEE OF THE PROPERTY OF JASON GABRIEL SAKER (A BANKRUPT)

Applicant

And

JASON GABRIEL SAKER (A BANKRUPT)

Respondent

REASONS FOR JUDGMENT

1. This is an ex parte application within the Court’s jurisdiction under s.27 of the Bankruptcy Act 1966 (Cth) (“the Act”) for orders to assist the trustee appointed as the trustee in bankruptcy of the respondent on 22 February 2016 in the protection and recovery of real property vested in the trustee and a show cause application in relation to non-compliance by the respondent with the requirements of the Act.

2. The applicant has adduced evidence from the trustee that identifies a particular property which was held in joint ownership by the respondent at the time of appointment of the trustee. On 29 August 2016 the trustee had his interest as a joint registered proprietor recorded on the relevant property. Since that date the trustee has taken steps to agree with the other joint owner a process for sale of the property. Notwithstanding steps taken by the trustee under the Act, it appears that the respondent has remained in possession and occupation of the property. The trustee has accordingly taken steps to commence proceedings in the Supreme Court of New South Wales to obtain possession of the property which are currently listed to be heard on 17 April 2017.

3. In the meantime, however, on the evidence of the trustee, it appears that the property has been the subject of a dumping of material without appropriate authority from the local council and in respect of which, on the evidence before the Court, I am satisfied there appears a real risk that the material would substantially adversely affect the remaining equity in the property taking into account a mortgage that exists on the same. The current identified creditors are not substantial but it is apparent from the evidence before the Court that the respondent has been aware of the steps taken by the trustee to try and obtain the report as to affairs and to obtain possession and to prevent continued use of the property involving dumping of waste by the respondent. On the evidence before the Court the respondent has not cooperated to date with the trustee and has taken steps to avoid compliance with obligations under the Act and has taken steps to attempt to avoid service of the proceedings taken in the Supreme Court. The potential diminution in the value of the property vested in the trustee for the benefit of the creditors is of considerable concern.

4. I am satisfied that there is a prima facie case that the respondent is taking steps to facilitate the dumping of material without appropriate approval from the local council on the relevant property. The balance of convenience weighs in favour of the grant of injunctive relief. Damages would be an inadequate remedy. I am satisfied that there is a prima facie case to warrant the grant of ex parte orders.

5. The ordinary practice in relation to interlocutory injunctive relief is that the Court requires an undertaking as to damages. The role performed by the trustee in the present case is a particular role in respect of the interests vested in the trustee for the benefit of the creditors of the respondent. The nature of relief being sought in the present case is one in respect of which I am satisfied it is appropriate for the Court to make an order dispensing with the requirement for the trustee to give an undertaking as to damages.

6. I am satisfied that this is an appropriate case in which to make a show case order in respect of the non-compliance by the respondent with the Act. I am also satisfied that this is an appropriate case taking into account the matters to which I have referred to grant an interlocutory order until further order restraining the respondent from causing material to be dumped on the relevant premises.

7. I am also satisfied that this is an appropriate case in respect of which the Court should exercise its powers to require the respondent to attend to give evidence as to his financial affairs, given his status as a bankrupt and his failure to comply with the requirements of the Act to date.

8. I am also satisfied that it is appropriate in the present case to require the respondent to produce all keys for access to the premises and/or any building sheds or containers thereon that are in his possession or the possession of his agent.

9. I am also satisfied that it is appropriate in the circumstances of the present case to require production of all records relating to the placing of waste or material on the premises since the time that the trustee became the joint registered proprietor.

10. I am satisfied on the material before the Court that leaving a sealed copy of these orders at the relevant premises will come to the attention of the respondent. I am satisfied that this is an appropriate case in which to make an order for substituted service and to dispense with personal service given the steps that the respondent has taken to evade service in the Supreme Court proceedings and the failure to comply with the requirements of the trustee to date.

11. It is for these reasons the Court grants the interlocutory relief identified in the order of the Court.

I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Judge Street

Date: 6 April 2017