Guss, Joseph v Johnstone, Raymond

[1997] FCA 1222

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VG 293 of 1997

ON APPEAL FROM A JUDGMENT OF A SINGLE JUDGE OF THE FEDERAL
COURT OF AUSTRALIA

BETWEEN:	JOSEPH GUSS Appellant
AND:	RAYMOND JOHNSTONE Respondent
JUDGES:		RYAN, WHITLAM AND MARSHALL JJ
DATE OF ORDER:		13 NOVEMBER 1997
WHERE MADE:		MELBOURNE

MINUTES OF ORDER

THE COURT ORDERS THAT:

1. The appeal be dismissed.

1. In the event that a sequestration order be subsequently made on the basis of the bankruptcy notice issued on 19 September 1996, the respondent’s costs of this appeal shall form part of the petitioning creditor’s costs, but that otherwise the appellant pay the respondent’s costs of this appeal, such costs to be taxed in default of agreement.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VG 293 of 1997

ON APPEAL FROM A JUDGMENT OF A SINGLE JUDGE OF THE FEDERAL
COURT OF AUSTRALIA

BETWEEN:	JOSEPH GUSS Appellant
AND:	RAYMOND JOHNSTONE Respondent

JUDGES:	RYAN, WHITLAM AND MARSHALL JJ
DATE:	13 NOVEMBER 1997
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

THE COURT:  This appeal concerns a bankruptcy notice dated 19 September 1996 issued at the instance of the respondent, Raymond Johnstone, (“the creditor”) requiring the debtor, Joseph Guss, to pay the sum of $4,989.40 due under an order for costs in the Supreme Court of Victoria or to secure payment of, or compound for, that sum.  The debtor sought to set aside the bankruptcy notice relying on an affidavit sworn 13 December 1996 to the effect that he, a solicitor, had retained the creditor, a barrister, to act in relation to certain proceedings in the Supreme Court of Victoria in or about 1992 on behalf of Tropitone Furniture Co International Pty Ltd (“Tropitone”) and others including the debtor.

It was asserted that certain proceedings taken on the advice of the creditor and embodied in documents drawn by him were misconceived and should have been brought by the liquidator of Tropitone Furniture Co Pty Ltd (in liquidation) (“TFC”).  Fresh proceedings were instituted in the name of TFC but that was only done after the debtor and interests associated with him had agreed to pay the liquidator’s costs of those proceedings amounting to $11,898.57.  The fresh proceedings in which the creditor continued to act as counsel for Mr Guss and interests associated with him were settled on terms negotiated by the creditor and signed by Mr Guss.  It is alleged that, because of an omission from, or deficiency in, the terms of settlement, Tropitone and other persons and entities associated with it suffered further loss because of their resultant inability to recover all the goods to which it is said they should have been entitled had the terms of settlement been properly drawn.  Those damages, including consequential loss flowing from deprivation of the use of the goods, were estimated by Mr Guss to amount in all to $150,000.  The debtor also referred to an order for…