Harrison v Del Santo - [2007] FMCA 470

FEDERAL MAGISTRATES COURT OF AUSTRALIA

HARRISON v DEL SANTO

[2007] FMCA 470

BANKRUPTCY – Application for dividend distribution – failure of respondent to file statement of affairs – application allowed.

Bankruptcy Act 1966, ss.54, 146

Official Trustee in Bankruptcy v Thor [2006] FMCA 1637
Official Trustee in Bankruptcy v Raeffaele, in the matter of Tindaro Raeffaele [2003] FCA 328
Re Sturt; Ex Parte Official Trustee in Bankruptcy [2001] FCA 1649
Scott (Trustee), in the matter of Heinrich (Bankrupt) [2005] FCA 1826

Applicant:

BRETT RICHARD GEOFFREY HARRISON AS TRUSTEE FOR THE BANKRUPT ESTATE OF MARGARET DEL SANTO

Respondent:

MARGARET DEL SANTO

File Number:

SYG 644 of 2007

Judgment of:

Nicholls FM

Hearing date:

28 March 2007

Date of Last Submission:

28 March 2007

Delivered at:

Sydney

Delivered on:

5 April 2007

REPRESENTATION

Counsel for the Applicant:

Mr. D. Radman

Solicitors for the Applicant:

Grace Lawyers Pty Ltd

Counsel for the Respondent:

Nil

Solicitors for the Respondent:

Nil

ORDERS

The costs, charges and expenses of the administration of the bankruptcy of the respondent and a distribution of dividends among creditors who prove their debts in the estate shall proceed in accordance with Part VI, Division 5 of the Bankruptcy Act 1966 as if the respondent had filed a Statement of Affairs and those creditors had been stated to be creditors in it.
The respondent not be entitled to any surplus funds remaining after payment of the costs, charges and expenses of the administration of the bankruptcy and after payment of the dividends to creditors until the respondent has lodged a duly completed Statement of Affairs in the required form with the applicant and the applicant has dealt with the claims of any further creditors disclosed in the Statement of Affairs.
The applicant’s costs of this application be paid from the bankrupt estate of the respondent.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 644 of 2007

BRETT RICHARD GEOFFREY HARRISON AS TRUSTEE FOR THE BANKRUPT ESTATE OF MARGARET DEL SANTO

Applicant

And

MARGARET DEL SANTO

Respondent

REASONS FOR JUDGMENT

This is an application seeking an order pursuant to s.146 of the Bankruptcy Act 1966 (Cth) (“Bankruptcy Act”) that a distribution of dividends be made to those creditors of the bankrupt estate of the respondent who prove their debts in accordance with Part VI, Division 5 of the Bankruptcy Act, notwithstanding that the respondent has failed to file a Statement of Affairs as required by this Act
This matter was referred to me as duty Federal Magistrate by a Registrar of this Court.
The applicant, Mr. B.R.G Harrison is the trustee of the bankrupt estate of Ms. M. Del Santo, who is the respondent in these proceedings.

Evidence

The applicant relies on the following:
a)
The affidavit of Brett Richard Geoffrey Harrison sworn on

21 February 2007
with annexures (“the first affidavit”).
b)The affidavit of Allan Robert Wood sworn on 5 March 2007 with annexures.
c)
The affidavit of Brett Richard Geoffrey Harrison sworn on

21 March 2007
with…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Harrison v Del Santo

Details

AGLC: Harrison v Del Santo [2007] FMCA 470
Case: [2007] FMCA 470
Decision Date: 5 April 2007

CaseChat Overview and Summary

In the Federal Court of Australia, Harrison sought relief against Del Santo in relation to the administration of Del Santo's bankruptcy. Harrison, acting as the Official Trustee of Del Santo's bankruptcy, brought the application to address procedural issues arising from Del Santo's failure to provide a Statement of Affairs. This omission had led to complications in the distribution of dividends among creditors and the proper administration of Del Santo's estate.

The central legal issue before the court was whether the court could direct the administration of Del Santo's bankruptcy to proceed in a manner that simulates the presence of a Statement of Affairs. Additionally, the court had to determine whether Del Santo should be barred from accessing any surplus funds until a Statement of Affairs was provided and processed. The court also needed to decide on the allocation of costs for the application.

The court ruled that despite Del Santo's failure to submit a Statement of Affairs, the administration of the bankruptcy could proceed as if such a statement had been filed. This approach was intended to ensure that creditors could have their debts acknowledged and dividends distributed in an orderly fashion. Furthermore, the court held that Del Santo would be ineligible to receive any surplus funds until a completed Statement of Affairs was submitted and any new creditors identified were addressed. Finally, the court ordered that the costs of the application be borne by Del Santo's bankrupt estate.

Orders

Orders of the court

The costs, charges and expenses of the administration of the bankruptcy of the respondent and a distribution of dividends among creditors who prove their debts in the estate shall proceed in accordance with Part VI, Division 5 of the Bankruptcy Act 1966 as if the respondent had filed a Statement of Affairs and those creditors had been stated to be creditors in it.

The respondent not be entitled to any surplus funds remaining after payment of the costs, charges and expenses of the administration of the bankruptcy and after payment of the dividends to creditors until the respondent has lodged a duly completed Statement of Affairs in the required form with the applicant and the applicant has dealt with the claims of any further creditors disclosed in the Statement of Affairs.

The applicant’s costs of this application be paid from the bankrupt estate of the respondent.

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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