FEDERAL CIRCUIT COURT OF AUSTRALIA
| HANKIN & ANOR & NANKERVIS | [2018] FCCA 2075 |
| Catchwords: BANKRUPTCY – Husband and wife purchase property – property transferred and re-transferred on several occasions – husband made bankrupt – wife makes claim to equitable interest in property – wife incarcerated – trustee seeks declaration as to legal and equitable interests in property – declarations made by Federal Court – trustee sells property – wife makes claim under s 114 of Family Law Act 1975 (Cth) for injunction to restrain sale or disposition of proceeds of sale – wife made bankrupt – trustee of wife’s bankrupt estate seeks to be joined to Family Law proceeding – trustee of wife’s bankrupt estate seeks to advance claim for adjustment of property interest under s 79 of Family Law Act 1975 (Cth) – whether court has jurisdiction or power to grant relief sought under s 79 or 114 of Family Law Act – whether court should grant relief as matter of discretion. |
| BANKRUPTCY – Jurisdiction of Federal Circuit Court under Bankruptcy Act 1966 (Cth) – power to grant relief – property under Bankruptcy Act includes choses in action – property includes statutory claims under ss 79 and 114 of Family Law Act – whether statutory claims are property of the bankrupt – locus standi – where substantive claims are vested in trustees of bankrupt estates of husband and wife – property vested in trustee in bankruptcy – proceedings in connexion with bankruptcy – property which is personal to bankrupt – whether claims under ss 79 and 114 of Family Law Act are not property which is divisible amongst creditors of bankrupt estate – whether s 116(1) of BankruptcyAct may not extend to such claims by operation of para 116(2)(q) of Act. |
| FAMILY LAW – Jurisdiction of Federal Circuit Court under Family Law Act – jurisdiction conferred in respect of matrimonial cause including claim involving trustee of bankrupt estate and vested bankruptcy property – joinder of additional parties does not deny jurisdiction – power to grant relief – necessity to identify existing legal or equitable interests in property – whether just and equitable to make orders – whether bankrupt spouse has standing to continue claim under ss 79 and 114 of Family Law Act – claims vested in trustee of bankrupt estate – fruits of litigation pass with vested claims. |
| PRACTICE AND PROCEDURE – Joinder – stay of proceedings in bankruptcy – whether person may continue claims once bankrupt – where trustee makes no election to prosecute or discontinue claims – where trustee put to election – election made to prosecute – necessity for leave to take further steps in proceeding – compromise of issues in dispute – approval of compromise dependent on jurisdiction to determine claims – late reference to further authority – not appropriate to consider further submission. |
| STATUTORY INTERPRETATION – Amending legislation affects amendments to Bankruptcy Act and Family Law Act – constructional choice between literal or purposive interpretation of amendment inserted in Family Law Act |
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- Case
- [2018] FCCA 2075
- Decision Date
CaseChat Overview and Summary
The court was required to determine whether to grant the trustees of Ms Hankin's bankrupt estate leave to file applications retrospectively, join them as second applicants to the proceedings, and amend the title of the proceeding accordingly. Crucially, the court had to decide whether to approve a compromise deed entered into on 15 June 2018 and, consequential to that approval, how funds held in the trust account of McLean & Associates, solicitors, should be distributed between the parties.
Judge Kelly applied the provisions of section 58(3)(b) of the *Bankruptcy Act 1966* (Cth) to grant the trustees leave to file their applications *nunc pro tunc*. The court approved the compromise embodied in the deed of agreement, ordering that Mr Nankervis, as trustee of Mr Hankin's bankrupt estate, pay $110,000.00 to the trustees of Ms Hankin's bankrupt estate from the specified trust account within seven days. Mr Nankervis was permitted to retain $329,143.37 from the same trust account. The trustees of Ms Hankin's estate were ordered to pay $3,000.00 to Ms Hankin within fourteen days. The initiating application filed on 29 June 2017 and subsequent applications were otherwise dismissed, with no order as to costs.
Orders
Orders of the court
1.
Pursuant to s 58(3)(b) of the Bankruptcy Act 1966 (Cth), Mr Abbas and Mr Capel in their capacity as trustees of the bankrupt estate of Ms Hankin have leave nunc pro tunc to file the application in a case filed on 6 December 2017 and the amended application in a case filed on 16 February 2018.
2.
Mr Abbas and Mr Capel, in their capacity as trustees of the bankrupt estate of Ms Hankin, be joined as second applicants to these proceedings.
3.
The title of the proceeding be amended so as to name:
(a) Ms Hankin, as first applicant;
(b) Mr Abbas and Mr Capel, in their capacity as trustees of the bankrupt estate of Ms Hankin, as second applicants;
(c) Mr Nankervis, in his capacity as trustee of the bankrupt estate of Mr Hankin, as respondent.
4.
Declare that the compromise embodied in the deed of agreement made on 15 June 2018 be approved.
5.
The respondent pay to the second applicants the sum of $110,000.00 from the money held in the trust account of McLean & Associates, solicitors within 7 days of the date of these orders.
6.
The respondent, in his capacity as trustee of the bankrupt estate of Mr Hankin retain the sum of $329,143.37 from the money held in the trust account of McLean & Associates, solicitors.
7.
The second applicants pay the sum of $3,000.00 to the first applicant within 14 days of the date of these orders.
8.
The initiating application filed on 29 June 2017 be otherwise dismissed.
9.
The application in a case filed on 6 December 2017 and the amended application in a case filed on 16 February 2018 otherwise be dismissed.
10.
There be no order as to costs.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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