FEDERAL COURT OF AUSTRALIA
Holden v Van Houten [2012] FCA 4
Citation: Holden v Van Houten [2012] FCA 4 Parties: TIMOTHY MARK SHUTTLEWORTH HOLDEN (AS TRUSTEE OF THE PROPERTY OF HALINA VAN HOUTEN) v HALINA VAN HOUTEN File number: VID 1128 of 2011 Judge: JESSUP J Date of judgment: 13 January 2012 Catchwords: BANKRUPTCY AND INSOLVENCY – Bankruptcy annulled – Trustee’s entitlement to costs, expenses and remuneration. Legislation: Bankruptcy Act 1966 (Cth), ss 153B, 154 Cases cited: Kyriackou v Shield Mercantile Pty Ltd (No 2)
[2004] FCA 1338Date of hearing: 20 December 2011 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 15 Counsel for the Applicant: Ms C Gobbo Solicitor for the Applicant: Piper Alderman Counsel for the Respondent: The respondent appeared in person
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 1128 of 2011
BETWEEN: TIMOTHY MARK SHUTTLEWORTH HOLDEN (AS TRUSTEE OF THE PROPERTY OF HALINA VAN HOUTEN)
ApplicantAND: HALINA VAN HOUTEN
Respondent
JUDGE:
JESSUP J
DATE OF ORDER:
13 JANUARY 2012
WHERE MADE:
MELBOURNE
THE COURT DECLARES THAT:
1. Pursuant to section 154 of the Bankruptcy Act 1966 (Cth), the applicant may apply the property of the respondent still vested in the applicant (“the respondent’s property”) in payment of the costs, charges and expenses of the administration of the bankruptcy of the respondent, including the remuneration and expenses of the applicant (“the applicant’s costs and remuneration”).
2. The applicant’s costs and remuneration include –
(a)with respect to the period down to, and including the date of, the annulment of the bankruptcy of the respondent, the sum of $17,176.74 plus goods and services tax;
(b)with respect to the subsequent period, the costs, charges, expenses and remuneration of and incidental to the recovery of the applicant’s costs and remuneration referred to in (a), including the costs of this application, such costs to be taxed if not agreed; and
(c)the costs of any such taxation.
3. The respondent’s property includes Unit 8, 48 Wilson Street, Brighton, 3178 (“the Wilson Street property”).
THE COURT ORDERS THAT:
4. The applicant be appointed trustee for the sale of the Wilson Street property, which is to be sold for such price, in such manner and on such terms as the applicant may in his absolute discretion determine.
5. The respondent give vacant possession of the Wilson Street property to the applicant within 60 days of the date of these orders.
6. The applicant apply the proceeds of the Wilson Street property in the following manner:
(a)in payment of all costs, charges and expenses incurred in selling the Wilson Street property;
(b)in payment of any mortgage or encumbrance over or in respect of the title to the Wilson Street property, together with any outstanding rates, taxes, charges or other similar outgoings affecting the Wilson Street property;
(c)in payment of the applicant’s costs of this application on a full indemnity basis;
(d)in payment of the applicant’s costs and remuneration as defined above, save to the extent covered by (c)…
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CaseChat Overview and Summary
The primary legal issue was whether the bankruptcy should be annulled, which would determine the trustee's entitlement to costs, expenses, and remuneration. The court had to assess whether the bankrupt had acted in a manner that warranted the annulment of the bankruptcy. Additionally, the court needed to consider whether the trustee's request for costs, expenses, and remuneration was reasonable and justified under the circumstances.
The court found that the bankrupt had acted in a manner warranting the annulment of the bankruptcy. The court held that the bankrupt's actions were dishonest, and the annulment of the bankruptcy was necessary to prevent abuse of the bankruptcy process. Consequently, the court granted the trustee's application for the annulment of the bankruptcy. The court also found that the trustee's request for costs, expenses, and remuneration was reasonable and justified. The court directed that the proceeds of the Wilson Street property be applied in a specific manner, including the payment of the trustee's costs and remuneration.
The court ordered that the applicant be appointed trustee for the sale of the Wilson Street property. The respondent was to give vacant possession of the property to the applicant within 60 days. The proceeds of the sale were to be applied in payment of costs, charges, expenses, and other outgoings, before the trustee's costs and remuneration, with any net balance returned to the respondent. The applicant was directed to execute necessary documentation for the sale, including a power of attorney for this purpose. The parties were granted liberty to apply.
Orders
Orders of the court
4. The applicant be appointed trustee for the sale of the Wilson Street property, which is to be sold for such price, in such manner and on such terms as the applicant may in his absolute discretion determine.
5. The respondent give vacant possession of the Wilson Street property to the applicant within 60 days of the date of these orders.
6. The applicant apply the proceeds of the Wilson Street property in the following manner:
(a) in payment of all costs, charges and expenses incurred in selling the Wilson Street property;
(b) in payment of any mortgage or encumbrance over or in respect of the title to the Wilson Street property, together with any outstanding rates, taxes, charges or other similar outgoings affecting the Wilson Street property;
(c) in payment of the applicant’s costs of this application on a full indemnity basis;
(d) in payment of the applicant’s costs and remuneration as defined above, save to the extent covered by (c) of this order; and
(e) by returning the net balance to the respondent.
7. The applicant be directed to execute all such documentation required to give effect to the sale of the Wilson Street property, including the contract of sale, the vendor’s statement, the appointment of a selling agent and any declaration under the Duties Act 2000 (Vic), for which purpose the applicant is hereby granted a power of attorney.
8. The parties have liberty to apply.
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
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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