In the Matter of Gaetano Mario Galtieri

[2015] FCCA 1472

FEDERAL CIRCUIT COURT OF AUSTRALIA

IN THE MATTER OF GAETANO MARIO GALTIERI [2015] FCCA 1472

Catchwords:
BANKRUPTCY – Application for review of Sequestration Order made against the estate of Applicant Bankrupt – no new grounds raised – application dismissed.

Applicant Bankrupt: GAETANO MARIO GALTIERI

Respondent Creditor: SYDNEY WATER CORPORATION

Trustee in Bankruptcy: DAVID HENRY SAMPSON

File Number: SYG 2866 of 2014

Judgment of: Judge Emmett

Hearing date: 27 May 2015

Date of Last Submission: 27 May 2015

Delivered at: Sydney

Delivered on: 27 May 2015

REPRESENTATION

The applicant bankrupt appeared in person.

Solicitor for the Respondent Creditor:

Mr Michael Roset

(Manion McCosker Solicitors)

Solicitor for the Trustee in Bankruptcy: Ms Elena Mitrovski
(Moisson Lawyers)

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2866 of 2014

GAETANO MARIO GALTIERI

Applicant Bankrupt

And

SYDNEY WATER CORPORATION

Respondent Creditor

DAVID HENRY SAMPSON

Trustee in Bankruptcy

EX TEMPORE

REASONS FOR JUDGMENT

FROM TRANSCRIPT

1. This is an application for review by the Applicant Bankrupt of a Sequestration Order made by a Registrar of this Court on 27 February 2015, against the estate of the Applicant Bankrupt and based on an act of bankruptcy on 16 June 2014. The Sequestration Order notes the consent of David Henry Sampson to act as trustee.

2. The Applicant Bankrupt was unrepresented before the Court this morning.

3. The Applicant Bankrupt submitted that he felt that he was incorrectly made bankrupt because of a misunderstanding between him and his then-legal representative and that the Sequestration Order made on 27 February 2015 should be set aside on that basis.

4. I asked the Applicant Bankrupt on what basis he could support such a claim. The Applicant Bankrupt was unable to provide a reply. I then asked the Applicant Bankrupt whether it would assist him to hear the submissions of the Respondent Creditor’s solicitor. The Applicant Bankrupt replied that it would.

5. The solicitor for the Respondent Creditor, Mr Michael Roset, told the Court that the Applicant Bankrupt committed the relevant act of bankruptcy on 16 June 2014. The Respondent Creditor became aware in November 2014 that the Applicant Bankrupt intended to sell his property at auction on 13 December 2014. The Respondent Creditor agreed with the Applicant Bankrupt’s then-legal representative that the Respondent Creditor would not bring a petition for a sequestration order until February 2015 in order to allow the auction to be conducted and settlement completed.

6. The Applicant Bankrupt’s property failed to sell at auction, whereupon the Respondent Creditor filed the petition for the Sequestration Order which was made on 27 February 2015.

7. The solicitor for the Trustee in Bankruptcy, Ms Elena Mitrovski, stated that the Trustee in Bankruptcy’s position was that the application for review should be dismissed, but otherwise added nothing further.

8. The Applicant Bankrupt referred to his affidavit, sworn on 29 March 2015 and filed on 30 March 2015, in support of his submission that he has sufficient liquid assets in order to pay his creditors. The relevant passages are as follows:

   “10. I have now, and had at the time that the Sequestration Order was made against me, sufficient legal assets to pay the Respondent and all my other creditors.

   11. I have sufficient funds to pay the Respondent’s debt immediately, and am willing to do so.

   12. I am working full time and have arranged tenants for my investment property.

   13. At all relevant times I was solvent and should not have been made a bankrupt.”

9. The Applicant Bankrupt submitted that he had paid all his outstanding debts and indicated that he had letters showing that his debt to Sydney Water Corporation had been paid.

10. Mr Roset read the affidavit of the Trustee in Bankruptcy, sworn 25 May 2015. The affidavit annexed a solvency report prepared by the Trustee. Mr Roset drew the Court’s attention to the Trustee’s conclusion in the report, which states:

    “Subject to the accuracy of Mr Galtieri’s disclosures in his statement of affairs, it is my opinion that he is insolvent as he is unable to pay his debts as and when they fall due from his readily available financial resources. Apart from his desire to enter into a debt repayment plan with Sydney Water, it appears he has ignored his debt to the ATO which he estimated at $50,000 and other creditors of between $20-30,000. Accordingly he has total unpaid creditor’s claims (excluding family members) of $97,419.63. Mr Galtieri has not submitted to me a proposal that would bring about the payment of his unsecured creditors in full without the sale of his Sans Souci property.”

11. Mr Roset informed the Court that the Applicant Bankrupt had been paying money direct to Sydney Water, despite the appointment of the Trustee in Bankruptcy to administer his bankrupt estate. The Respondent Creditor had been unable to stop the Applicant Bankrupt from making payments to it direct. Mr Roset also directed the Court’s attention to the Solvency Report’s statement that:

    “I am aware that Mr Galtieri has the following additional creditors which were not disclosed in his statement of affairs…

    2. Australian Taxation Office - $5,215.75. It is noted that the bankrupt has failed to lodge tax returns for the 2007 to 2014 financial years. It is not known if there will be additional taxation liabilities for these periods.”

12. The Applicant Bankrupt  had no other evidence to provide to the Court in support of his affidavit. He was unable to provide receipts from the Australian Taxation Office to show that he had paid his debt to them, however stated that during the period in question he was the recipient of a pension. The Applicant Bankrupt confirmed that he had nothing to provide to the Court beyond the evidence before the Registrar at the time the Sequestration Order was made.

13. The Applicant Bankrupt then stated that he wished to seek legal advice. To the extent that the Applicant Bankrupt was seeking an adjournment of today’s proceedings, that application was opposed by the Respondent Creditor. The Applicant Bankrupt has had more than ample time to seek legal advice in respect of the proceeding, and accordingly that application was refused.

14. The Applicant Bankrupt submitted that he thought his property would sell at auction, that the property was still for sale and that he has a buyer for the property. The Applicant Bankrupt also stated that his accountant had told him that he had no debt and further stated that he was prepared to provide a witness to attest to this. However, as stated above, there was no evidence provided to the Court to support those bare assertions.

15. In the circumstances, there is nothing before the Court to justify the setting aside of the Sequestration Order made on 27 February 2015. I note that the Sequestration Order was made in accordance with the statutory scheme. The Applicant Bankrupt’s submissions are no more than bare assertions which are unsupported by any evidence.

16. The evidence put forward by the Respondent Creditor’s solicitor suggests that the Applicant Bankrupt still carries outstanding debts. In the absence of any other evidence, I prefer the evidence of the Respondent Creditor.

17. Accordingly, the Applicant Bankrupt’s application for review of the Sequestration Order made on 27 February 2015 should be dismissed, with costs.

I certify that the preceding seventeen (17) paragraphs are a true copy of the reasons for judgment of Judge Emmett

Associate: 

Date:  1 June 2015