Haughton v Shanahan - [2024] FCA 160

FEDERAL COURT OF AUSTRALIA
Haughton v Shanahan [2024] FCA 160

File number: SAD 52 of 2023

Judgment of: CHARLESWORTH J

Date of judgment: 23 February 2024

Date of publication of reasons: 28 February 2024

Catchwords: BANKRUPTCY – application for an order annulling a bankruptcy under s 153B of the Bankruptcy Act 1966 (Cth) – joinder of the Inspector-General in Bankruptcy as a respondent – applicant seeking “interim relief” against the Inspector-General – applicant alleging the Inspector-General is legally obliged to apply s 86 of the Bankruptcy Act – applicant otherwise alleging the Inspector-General has a legal obligation to ensure that all Trustees in all bankruptcies properly apply s 86 of the Bankruptcy Act in the administration of all bankrupt estates – originating application including no claim against the Inspector-General having reasonable prospects of success – orders for striking out certain parts of the originating application – order for removal of Inspector-General as a party

Legislation: Bankruptcy Act 1966 (Cth) ss 11, 12, 86, 153B

Cases cited:
Gye v McIntyre (1991) 171 CLR 609

Majeed v Kerr [2016] FCCA 1625

Minister for Immigration and Citizenship v Li (2013) 249 CLR 332

Division: General Division

Registry: South Australia

National Practice Area: Commercial and Corporations

Sub-area: General and Personal Insolvency

Number of paragraphs: 31

Date of hearing: 23 February 2024

Counsel for the Applicant: The Applicant appeared in person

Counsel for the First Respondent: The First Respondent did not appear

Counsel for the Second Respondent: The Second Respondent appeared in person

Counsel for the Third Respondent: Mr C Hutchins

Solicitor for the Third Respondent: Australian Government Solicitor

ORDERS

SAD 52 of 2023

BETWEEN:
PETER SCOTT HAUGHTON

Applicant

AND:
JOHN GERVASE SHANAHAN

First Respondent

FUI SAK CHANG

Second Respondent

TIM BERESFORD

Third Respondent

ORDER MADE BY:

CHARLESWORTH J

DATE OF ORDER:

23 FEBRUARY 2024

THE COURT NOTES THAT:
1.The written submissions of the applicant dated 9 February 2024 are marked MFI-2.
2.The third respondent seeks an order for costs of and incidental to his application for orders that he be removed as a party.

THE COURT ORDERS THAT:
1.The Registrar lodge on the applicant’s behalf and accept for filing the document marked MFI-2.
2.The following parts of the originating application dated 3 April 2023 be struck out:
(a)paragraph 3 under the heading “Details of claim”; and
(b)paragraph 6 under the heading “Claim for interim relief”.

3.The third respondent, Mr Tim Beresford, be removed as a party.
4.The time for the applicant to exercise rights of appeal (if any) in respect of the orders in paragraphs 2 and 3 be extended so as to commence on the date on which the parties are provided with written reasons for those orders.
5.Mr Timothy Beresford, the former third respondent, has liberty to approach the Court in relation to his application for costs at any time in these proceedings, or following judgment on the annulment application.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT
CHARLESWORTH J:

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 Haughton v Shanahan

Details

AGLC: Haughton v Shanahan [2024] FCA 160
Case: [2024] FCA 160
Decision Date: 23 February 2024

CaseChat Overview and Summary

Haughton v Shanahan involved a bankruptcy matter where the applicant sought an order annulling their bankruptcy under section 153B of the Bankruptcy Act 1966 (Cth). The Inspector-General in Bankruptcy was joined as a respondent, with the applicant claiming that the Inspector-General is legally obliged to apply section 86 of the Bankruptcy Act. The applicant further alleged that the Inspector-General has a legal obligation to ensure all Trustees in bankruptcies properly apply section 86 of the Act in the administration of bankrupt estates. This application was heard by the Federal Court of Australia.

The court had to decide whether the applicant's claims against the Inspector-General had reasonable prospects of success. It was necessary to determine if the applicant's claims were justiciable and if the Inspector-General's role in bankruptcy proceedings warranted the claims made. Additionally, the court had to consider whether the applicant's originating application contained any claims that could be struck out as having no reasonable prospects of success.

The court found that the applicant's claims against the Inspector-General did not have reasonable prospects of success, as the applicant's allegations did not establish a justiciable matter. The court accordingly struck out certain parts of the originating application. The court also removed the Inspector-General as a party to the proceedings. As a result, the court made orders to extend the time for the applicant to appeal the striking out of parts of the application and to provide written reasons for those orders. The former third respondent, Mr Timothy Beresford, was granted liberty to approach the court regarding his application for costs at any time in these proceedings, or following judgment on the annulment application.

Orders

Orders of the court

1. The Registrar lodge on the applicant’s behalf and accept for filing the document marked MFI-2.

2. The following parts of the originating application dated 3 April 2023 be struck out:

(a) paragraph 3 under the heading “Details of claim”; and

(b) paragraph 6 under the heading “Claim for interim relief”.

3. The third respondent, Mr Tim Beresford, be removed as a party.

4. The time for the applicant to exercise rights of appeal (if any) in respect of the orders in paragraphs 2 and 3 be extended so as to commence on the date on which the parties are provided with written reasons for those orders.

5. Mr Timothy Beresford, the former third respondent, has liberty to approach the Court in relation to his application for costs at any time in these proceedings, or following judgment on the annulment application.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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File number:	SAD 52 of 2023
Judgment of:	CHARLESWORTH J
Date of judgment:	23 February 2024
Date of publication of reasons:	28 February 2024
Catchwords:	BANKRUPTCY – application for an order annulling a bankruptcy under s 153B of the Bankruptcy Act 1966 (Cth) – joinder of the Inspector-General in Bankruptcy as a respondent – applicant seeking “interim relief” against the Inspector-General – applicant alleging the Inspector-General is legally obliged to apply s 86 of the Bankruptcy Act – applicant otherwise alleging the Inspector-General has a legal obligation to ensure that all Trustees in all bankruptcies properly apply s 86 of the Bankruptcy Act in the administration of all bankrupt estates – originating application including no claim against the Inspector-General having reasonable prospects of success – orders for striking out certain parts of the originating application – order for removal of Inspector-General as a party
Legislation:	Bankruptcy Act 1966 (Cth) ss 11, 12, 86, 153B
Cases cited:	Gye v McIntyre (1991) 171 CLR 609 Majeed v Kerr [2016] FCCA 1625 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332
Division:	General Division
Registry:	South Australia
National Practice Area:	Commercial and Corporations
Sub-area:	General and Personal Insolvency
Number of paragraphs:	31
Date of hearing:	23 February 2024
Counsel for the Applicant:	The Applicant appeared in person
Counsel for the First Respondent:	The First Respondent did not appear
Counsel for the Second Respondent:	The Second Respondent appeared in person
Counsel for the Third Respondent:	Mr C Hutchins
Solicitor for the Third Respondent:	Australian Government Solicitor

ORDER MADE BY:	CHARLESWORTH J
DATE OF ORDER:	23 FEBRUARY 2024