Hounslow v Gill - [2008] FMCA 570

FEDERAL MAGISTRATES COURT OF AUSTRALIA

HOUNSLOW v GILL & ANOR

[2008] FMCA 570

BANKRUPTCY – Injunction sought against Trustee of Bankrupt Estate – refused as no serious question to be tried – balance of convenience in favour of Trustee.

Bankruptcy Act 1966 (Cth)

Applicant:

BRENTON EVAN HOUNSLOW

First Respondent:

DIMITY GILL

Second Respondent:

COLIN L AMBROSE AS TRUSTEE OF THE BANKRUPT ESTATE OF BRENTON EVAN HOUNSLOW

File Number:

ADG 48 of 2008

Judgment of:

Simpson FM

Hearing date:

23 April 2008

Date of Last Submission:

23 April 2008

Delivered at:

Adelaide

Delivered on:

7 May 2008

REPRESENTATION

Counsel for the Applicant:

Applicant in Person

Counsel for the Respondents:

Mr Gretsas

Solicitors for the Respondents:

Gretsas & Associates

ORDERS

The applicant’s application for an order that the second respondent be injuncted and restrained from selling or otherwise disposing of the items in the table contained in paragraph 5 of the statutory declaration of Doris Pearman annexed to the affidavit of the applicant filed herein on 18 April 2008 is refused.
The question of costs of the application is reserved.
Judgment reserved to a date to be advised.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
ADELAIDE

ADG 48 of 2008

BRENTON EVAN HOUNSLOW

Applicant

And

DIMITY GILL

First Respondent

COLIN L AMBROSE AS TRUSTEE OF THE BANKRUPT ESTATE OF BRENTON EVAN HOUNSLOW

Second Respondent

REASONS FOR JUDGMENT

This is an application by a bankrupt, Brenton Evan Hounslow, for an order that the second respondent, Colin L Ambrose as Trustee of the Bankruptcy Estate of the applicant, be restrained from selling or otherwise disposing of certain items identified in a schedule contained in para.5 of an affidavit of Doris Pearman which is annexure 4 to the affidavit of the applicant filed on 18 April 2008. The items referred to are motor vehicles and motor vehicle parts. The schedule identifies persons who the deponent to the affidavit, Ms Pearman, and the applicant herein say are the owners of the various items referred to in the schedule. None of the items are said to be owned by the applicant.
The applicant filed the affidavit as previously mentioned in support of the application. An application was not filed but instead the applicant sent a letter to the Court dated 16 April 2008 in which he sought an extension of time to comply with an earlier order of the Court made on 5 March 2008 which allowed the applicant to file and serve further affidavits within a six week period.
The applicant’s original application sought the following final orders:
a)Annulment of bankruptcy (due to a judgment only because of non-attendance);
b)Compensation by Ambrose for loss and damage of all property both business and personal;
c)Compensation for loss of all residential, investment and commercial properties and business income also by Ambrose.
The applicant sought the following interim orders:
a)Payment of income lost from 15 November 2007 (week 46) to 27 February 2008 (week 9) and continuing $15,000;
b)Rent owing on shed seized and locks changed three months at $1,210 $3,630;
c)Legal fees to date $13,384 due to no income available immediate due $32,014
d)Stay of proceedings of my bankrupt estate injunction of trustee and liquidator disposing of further assets.
The initial application was supported by an affidavit of Mr Hounslow filed on 3 March 2008. The affidavit simply deposed to the fact that a statement and 23 pages of supporting documents letters and statements were annexed. The statement says that the applicant was declared bankrupt on 25 June 2007. He says that the lawyer that he had acting for him had the hearing (he does not say which one) adjourned the matter for two weeks then did not appear on the next occasion. I take it that Mr Hounslow is referring to the hearing was of the proceedings that resulted in the judgment being obtained which judgment was relied upon for the bankruptcy notice. Mr Hounslow then makes various criticisms of his trustee. These criticisms do not appear to be relevant to the current application for an injunction.
One of the letters contained in the bundle annexed to Mr Housnlow’s affidavit is a letter from Commercial and General Law. The letter is dated 27 December 2007 and is addressed to Gretsas and Associates, Solicitors for the applicant’s trustee in bankruptcy. The letter says that Commercial and General Law are acting for Doris Pearman and Cycles Sports Australia Pty Ltd as Trustee of the Docteur Desmo Trading Trust. The letter says that the trustee removed certain items from a shed on Main North Road at Blair Athol on 21 December 2007 and that those items were and remain the property of Docteur Desmo Trading Trust. The letter goes on to say that the contents of the shed were not and have never been the property of Brenton Evan Hounslow. The letter requests that the trustee in bankruptcy return the items to Ms Pearman and or Cycles Sports Australia Pty Ltd as trustee of the Docteur Desmo Trading Trust.
Also annexed to the Hounslow affidavit of 3 March 2008 is a copy of a letter from the second respondent to the applicant stating that he attended premises at Main North Road Blair Athol on 21 December 2007 with Federal Police subject to a search warrant issued by the Federal Court of Australia. It states that pursuant to the warrant certain items were seized and removed from the premises and placed with auctioneers with the intention that they would be sold. The letter contained other information that is not relevant to the current application.
Also annexed to the Hounslow affidavit of 3 March 2008 is a letter from the trustee to the applicant dated 11 July 2007 in which the trustee confirmed that in a telephone conversation that he had with the applicant on 25 June 2007 he informed the applicant of his bankruptcy. It also confirmed that at a meeting on 26 June 2007 between the applicant and the trustee in bankruptcy the applicant was advised of his responsibilities as a bankrupt.
Mr Hounslow filed a further affidavit on 18 April 2008. That affidavit annexes a statutory declaration of Doris Pearman declared by her on 25 January 2008. The Pearman declaration says that she is a director of Cycles Sports Australia Pty Ltd which is the trustee of the Docteur Desmo Trading Trust pursuant to a supplementary deed that is annexed to the declaration. She says further that the trust sublet the premises at 9/406 Main North Road, Blair Athol and that Cycles Sports Australia Pty Ltd subleased those premises in anticipation that it might be required to move out of premises it occupied at 394 Main North Road, Blair Athol. She says further that the trust is the beneficial owner of all items that were located at the premises at 406 Main North Road on 21 December 2007 save and except for certain items (which were listed in the declaration) which belonged to various people (who were identified against each of the items listed). She states that statutory declarations will be provided from each of the people mentioned confirming their ownership of the particular items concerned. Those statutory declarations were not provided to this Court. She says that on 21 December 2007 Colin Ambrose as Trustee of the Bankrupt Estate of Brenton Evan Hounslow entered the premises and took possession of all the items therein pursuant to a warrant obtained in the Federal Court of Australia. She says that the application (I take her to mean the warrant) was obtained ex parte.
An affidavit was filed on behalf of the applicant’s trustee in bankruptcy, Mr Ambrose. The affidavit was sworn on 22 April 2008. Mr Ambrose stated that he had scheduled an auction for the sale of various motor vehicles and parts formerly belonging to the applicant and that the auction is to be held on 24 April at 12 noon. He estimates that the publication of advertisements advertising the auction for this date, storage, insurance and time will cost the estate approximately $10,558. He says that if the auction is cancelled or delayed then similar costs will be incurred when the property is later re-advertised for auction. He states that he has been informed by the auctioneer that has been engaged that their advertising has also canvassed motor cycle clubs around the country and overseas and that parties have made arrangements to attend the auction from interstate locations. He says that should the auction sale be cancelled or postponed then there would be significant inconvenience and possible unrecoverable costs incurred by various parties.
Mr Ambrose states that he believes that the applicant has no legal standing to make application for the auction to be stopped as the applicant’s evidence suggests that the property to be auctioned is owned by third parties and not by the applicant. Mr Ambrose believes that it is for those third parties to make a claim to be the rightful owners of the property to be able to make an application to the Court. Alternatively those persons could contact Mr Ambrose regarding their claims. Mr Ambrose says that there have only been three persons who have contacted him concerning ownership of certain of the items concerned. He says that two of those persons provided him with sufficient evidence as to their rightful ownership after which Mr Ambrose that the items concerned would be released to them. Mr Ambrose says that the third person who has contacted him was the son of the applicant and that he (Mr Ambrose) had invited the applicant’s son to produce documentary evidence substantiating his claim to the motor cycle concerned.
I agree with the submissions that have been put on behalf of Mr Ambrose namely that the applicant has no standing to bring an application for the orders that he seeks. Such an application should be brought by those persons who believe that the property is theirs. Mr Ambrose believes that the property is in fact owned by the applicant. As such he believes that it is appropriate for him to take steps to sell the assets to realise money to go into the bankrupt estate.
In my opinion the applicant has not shown a serious question to be tried. On that basis alone the application should be refused. In my opinion the balance of convenience is also with Mr Ambrose for the reasons mentioned in his affidavit.
In his affidavit Mr Ambrose sought an order that the applicant pay his costs on an indemnity basis. At the hearing I was asked by Counsel for Mr Ambrose to simply reserve costs. I propose to do so.
When I heard argument in this matter on 23 April 2008 I made the orders to be found at the beginning of these reasons. I now publish my reasons.

I certify that the preceding fifteen (15) paragraphs are a true copy of the reasons for judgment of Simpson FM

Associate: Julie Davey

Date: 7 May 2008