Jones v Mougios

[2015] FCCA 2076

FEDERAL CIRCUIT COURT OF AUSTRALIA

JONES v MOUGIOS [2015] FCCA 2076

Catchwords:
BANKRUPTCY – Application for order under s.146 of the Bankruptcy Act 1966 (Cth) (Act) that the distribution of dividends proceed as if bankrupt had filed a statement of affairs as required by the Act – application granted.

Legislation:

Bankruptcy Act 1966 (Cth), s.146

Official Trustee in Bankruptcy; in the matter of Shaw [1999] FCA 968
Re Sturt; Ex parte Official Trustee in Bankruptcy [2001] FCA 1649; (2001) 117 FCR 1

Applicant: MICHAEL GREGORY JONES AS TRUSTEE FOR THE BANKRUPT ESTATE OF EVRIPIDIS MOUGIOS

Respondent: EVRIPIDIS MOUGIOS

File Number: SYG 1338 of 2015

Judgment of: Judge Manousaridis

Hearing date: 29 July 2015

Delivered at: Sydney

Delivered on: 4 August 2015

REPRESENTATION

Solicitors for the Applicant: Mr Z Gazzard of Uther Webster & Evans

No appearance by or on behalf of the respondent.

ORDERS

1. Pursuant to s.146 of the Bankruptcy Act 1966 (Cth) (Act) the distribution of dividends from the estate of Evripidis Mougios (bankrupt) amongst the creditors who have proved their debts proceed in accordance with Division 5 of the Act as if the bankrupt had filed a statement of his affairs and that those creditors had been stated to be creditors in it.

2. The applicant’s costs of the application filed on 15 May 2015 be paid from the estate of the bankrupt.

3. The applicant’s costs referred to in order 2 are set in the amount of $7,760.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 1338 of 2015

MICHAEL GREGORY JONES AS TRUSTEE FOR THE BANKRUPT ESTATE OF EVRIPIDIS MOUGIOS

Applicant

And

EVRIPIDIS MOUGIOS

Respondent

REASONS FOR JUDGMENT

1. The trustee of the estate of Evripidis Mougios applies for an order under s.146 of the Bankruptcy Act 1966 (Cth) (Act) which provides:

   Where a bankrupt has failed to file a statement of his or her affairs as required by this Act, the Court may, on the application of the trustee, upon such terms as it thinks fit, order that distribution of dividends amongst the creditors who have proved their debts shall proceed in accordance with this Division as if the bankrupt had filed a statement of his or her affairs and those creditors had been stated to be creditors in it.

2. The trustee was appointed trustee in bankruptcy of the estate of Mr Mougios as a result of a sequestration order made by this Court on 20 June 2013.

3. Commencing on or about 23 June 2013 the trustee, on a number of occasions, requested that Mr Mougios, complete and send to the trustee a statement of affairs. Mr Mougios, however, has failed to do so; and there is no prospect that he will. The precondition for the exercise of the power conferred by s.146 of the Act is, therefore, satisfied.

4. Section 146 of the Act “is intended to facilitate the distribution of dividends among the creditors of the bankrupt in circumstances where the trustee has not had the benefit of a statement of affairs prepared by the bankrupt”.[1] The purpose of s.146 of the Act is “to give the Court the means of ensuring that the absence of a statement of affairs does not prejudice those with an interest in the bankrupt’s affairs”.[2] Relevant factors to the exercise of the discretion conferred by s.146 of the Act include whether creditors have been notified of the application and have had the opportunity to be heard,[3] and whether the trustee has taken steps to ascertain whether there are creditors other than those who have come to the trustee’s attention by filing a proof of debt.[4]

   [1] Re Sturt; Ex parte Official Trustee in Bankruptcy [2001] FCA 1649;(2001) 117 FCR 1 at [14] (Sackville J)

   [2] Official Trustee in Bankruptcy; in the matter of Shaw [1999] FCA 968 at [4] (Gyles J)

   [3] Re Sturt; Ex parte Official Trustee in Bankruptcy[2001] FCA 1649; (2001) 117 FCR 1 at [19] (Sackville J)

   [4] Re Sturt; Ex parte Official Trustee in Bankruptcy[2001] FCA 1649; (2001) 117 FCR 1 at [19] (Sackville J)

5. The evidence reveals, and I find, the following. On 5 August 2013 the trustee sought to identify creditors of Mr Mougios by causing a search to be conducted of a database maintained by a credit reporting agency known as Veda Advantage. That search revealed a number of creditors (Identified Creditors). On or about 23 August 2013 the trustee arranged for a letter to be sent to each of the Identified Creditors. On 13 March 2015 the trustee arranged to send a creditor’s report to all the Identified Creditors. The creditor’s report included a notice of intention to creditors to declare a first and final dividend. Four of the Identified Creditors lodged proofs of debt which the trustee accepted.

6. I am satisfied the trustee has undertaken all reasonable steps to ascertain the identity of creditors of Mr Mougios, and that the trustee has given to those creditors whom he has identified reasonable notice of his intention to apply for the orders the trustee seeks in this application. I am otherwise satisfied that I should make an order under s.146 of the Act, and an order that the trustee’s costs of the application be paid from the estate of Mr Mougios. I propose to order that the trustee’s costs be set in the amount of $7,760.

I certify that the preceding six (6) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis

Associate: 

Date:  4 August 2015