Ha v White - [2003] FMCA 64

FEDERAL MAGISTRATES COURT OF AUSTRALIA

HA v WHITE

[2003] FMCA 64

BANKRUPTCY – Bankrupt sought permission to travel overseas – considerations to be taken into account – affected by decision of trustee – application dismissed.

Bankruptcy Act 1966 (Cth), ss.178, 272, 161B, 139W

Re Wheeler; Ex parte Wheeler v Halase (1994) 54 FCR 166
Bethune v Newman 19 ACSR 99
Weiss v Official Trustee in Bankruptcy (1983) FCR 40
Mayger v Prentice [2000] FCA 99
Re Tyndall; Ex parte Official Receiver 17 ALR 182

Applicant:

BA THI HA

Respondent:

WARREN BRIAN WHITE

File No:

MZ 30 of 2003

Delivered on:

16 January 2003

Delivered at:

Melbourne

Hearing Date:

16 January 2003

Judgment of:

Hartnett FM

REPRESENTATION

Counsel for the Applicant:

Ms B.T. Ha appeared on her own behalf

Address for the Applicant:

Ms Ha

Counsel for the Respondent:

Mr M. Galvin

Solicitors for the Respondent:

Maddocks Lawyers

ORDERS

The application filed 15 January 2003 is dismissed.
The applicant to pay the respondent’s costs of the application in accordance with the Federal Court Rules.
Certify for Counsel.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MZ 30 of 2003

BA THI HA

Applicant

And

WARREN BRIAN WHITE

Respondent

REASONS FOR JUDGMENT

This is an ex tempore judgment.
The applicant filed an application on 15 January 2003 for “permission to travel overseas”. In support of that application the applicant relied upon an affidavit affirmed by her on 15 January 2003. She was assisted by Kiet Minh Pham both in the completion of her material and in the proceedings before me. He translated the proceedings from English into Vietnamese for his mother.
The applicant is an undischarged bankrupt. The respondent is the registered trustee in bankruptcy. The respondent opposes the application. Although not stated, the application relies upon section 178 of the Bankruptcy Act 1966. Section 178 of the said Act provides that:
If the bankrupt, a creditor or any other person is affected by an act, omission or decision of the trustee, he or she may apply to the Court and the Court may make such order in the matter as it thinks just and equitable.
The other section to which I refer at the present time is section 272 of the Bankruptcy Act 1966 (hereinafter referred to as ‘the Act’), and in particular subparagraph (c). Section 272 provides "A person who." And subparagraph (c):
Not being a person to whom paragraph (ba) applies,
which does not apply to the applicant –
after he or she has become a bankrupt and before he or she is discharged from bankruptcy without the consent in writing of the trustee of his or her estate, leaves Australia, or does an act preparatory to leaving Australia;
is guilty of an offence and is punishable on conviction by imprisonment for a period not exceeding 3 years.
It is clear from the above that the applicant needed to seek the permission of the trustee to depart from Australia to travel to Vietnam for the purpose of attending her son's forthcoming wedding and for the additional purpose of staying for a period of time up until June 2003 to care for her aged mother. In submissions made before me the applicant sought in the alternative that she be permitted to remain in Vietnam for a period of 3 weeks.
A sequestration order was made against the applicant on 27 September 2001. On that same date, Warren Brian White, the named respondent in these proceedings and a chartered accountant, became trustee of the bankrupt estate. The applicant's application was served on the trustee at approximately 3 pm yesterday but nevertheless the trustee is in a position to proceed at such short notice this day.
In his affidavit, and in particular in paragraph 3, the trustees set out the basis on which he has to date refused to permit the bankrupt to travel overseas. The trustee refers to the bankrupt having not paid the statutory minimum remuneration entitlement as required by section 161B of the Act. This amount in the sum of $1,269 remains unpaid, although the applicant's son indicated in the courtroom, and indeed in material annexed to the affidavit material of the applicant (document headed ‘3’ being a copy facsimile transmission dated 9 January 2003 from Kiet Pham to the trustee) that he was willing to pay the trustee the amount of $1,269. That amount remains unpaid at the time of the delivery of these reasons.
The trustee sets out other grounds, in particular that the bankrupt had failed to provide documents as requested by him, including information concerning her superannuation and life policies, bank accounts and chequebooks operated by her from the period 1 January 2001. Those requests for information were contained in a letter of 26 March 2002 to the bankrupt. In addition, and importantly, information was sought from the bankrupt as to the details of the sale of a property situate at 12 Albert Street, Abbotsford. The bankrupt has failed to provide such information.
Furthermore, on 8 January 2003 the trustee had sent a letter to the bankrupt enclosing an income questionnaire to be completed by the bankrupt in accordance with section 139U of the Act. Although the 21 days allowed has not yet lapsed, to date the bankrupt has not provided the completed income questionnaire.
The bankrupt was the joint registered proprietor of the property at

12 Albert Street Abbotsford which was sold in March 2001 with a settlement date unknown to me and from which a net sum was derived of approximately $147,000. The trustee estimates that the applicant bankrupt may have been entitled to $73,500 of those funds and requires information from the bankrupt as to the disposal of such funds. At the time of the sale of the property resulting in the receipt of such funds by the bankrupt and her husband there were outstanding judgment debts against others and also the bankrupt, those judgment debts totalling $740,000 and being approximately $630,000 in favour of the ANZ Banking Group Ltd and $110,000 in favour of the law firm Ebsworth. Each of those judgments was obtained in the month of November 2000.
The statement of affairs of the bankrupt was not received by her trustee until 11 February 2002. The sequestration order was made on

27 September 2001.
In correspondence of 7 January 2003 which is in evidence before me to the applicant's son the trustee set out the basis on which he declined to grant the bankrupt permission to travel overseas. The applicant's son responded in facsimile transmission dated 9 January 2003. That correspondence indicated that the proceeds from the sale of 12 Albert Street Abbotsford were initially placed in a commercial bill in the son’s name only and were then dispersed in the financing of the applicant and her husband's numerous trips to Vietnam and in the applicant husband's gambling at the Crown Casino.
The trustee has raised the possibility of an application pursuant to section 120 of the Act being made by him with respect to the proceeds of sale of 12 Albert Street Abbotsford. The trustee is currently unable to determine the prospects of such application until he receives cooperation from the applicant bankrupt.
The applicant submitted to the court that her trip would be paid for by her four children. Further monies necessary would be provided by her son and supplemented by her fortnightly pension that she remains in receipt of.
The applicant said that her husband had been estranged from the family for some time – almost two years. However, her pension she described as a carer's pension on the basis of her need to care for her husband who suffered ill health. This was contradictory information and I could really make no finding as to whether or not the bankrupt and her husband currently reside together, nor whether or not the bankrupt is in receipt of a carer's or other form of pension.
The trustee submitted that he was concerned the applicant may fail to return to this country. The applicant denied that and asserted that she held no Vietnamese passport and that she would be returning to this country. She would continue to receive an Australian pension whilst in Vietnam. The status of her residence in that country was not put before me and I can make no finding as to it.
The onus is upon the bankrupt in these proceedings to establish that the trustee's administration of the affairs of the bankrupt is to be reviewed. I find nothing in the trustee's exercise of his discretion to suggest that the trustee's discretion has miscarried.
In this matter I have had the opportunity to examine earlier decisions of the Federal Court of Australia. In Re Tyndall; Ex parte Official Receiver 17 ALR 182 Deane J. said as to such applications:-
I do not regard a decision by the trustee on an application by a bankrupt for permission to travel overseas as coming within the category of decision which should be treated as being within the ordinary day-to-day administration of a bankrupt estate … requiring careful consideration of all relevant circumstances for the reason (such an application is) ordinarily related to the freedom of a subject, who is neither a criminal nor under criminal restraint, to travel to pursue his legitimate commercial or personal desires.
(page 187)
However, the applicant's evidence before me is vague and unsatisfactory and does not discharge the onus that is placed upon the applicant in a proceeding of this nature. There is nothing on the material before me and in the submissions made to me to suggest that the trustee's decision in this matter has been perverse or clearly wrong or that the justice and equity of the matter requires this court to interfere in the discretion exercised by the trustee. The requests made by the trustee of the bankrupt for information appear to have been so made in the interests of a prompt and efficient administration of the applicant's bankrupt estate.
As I indicated to the applicant, there may be some stage in the future when the trustee will determine that it is possible for the bankrupt to travel overseas without any prejudice to either the administration of the bankrupt's estate or of the Act. The payment of the statutory sum and compliance with requests of the trustee, together with a certain level of cooperation with respect to the explanation of the dispersal of funds from the Abbotsford property might go a long way to determining in the trustee's mind that it would be appropriate for the bankrupt to have possession of her passport for the purposes of travelling to Vietnam, if only for the limited purpose of attending her son's wedding. Of course, such leave might be granted subject to necessary safeguards to ensure the return of the bankrupt.
It is not appropriate to return this matter for reconsideration to the trustee. The application should be dismissed. I propose to order that the applicant pay the respondent’s costs.

I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of Hartnett FM

Associate: L.M.Dorian

Date: 4 March 2003