Legal Research
Cases
Jones v Verity

Jones v Verity

Case [2007] FMCA 1108 12 July 2007

Costs

Stay of Proceedings

Insolvency Law

Type to search within this case.

FEDERAL MAGISTRATES COURT OF AUSTRALIA

JONES v VERITY

[2007] FMCA 1108

BANKRUPTCY – Creditors Petition – whether defect in Bankruptcy Notice – failure to provide proper address of creditor – preliminary issue – whether error by failure to identify relevant legislation relied on for interest – reference to Penalty Interest Rates Act.

Bankruptcy Act 1966, ss.306, 306(1)
Federal Magistrates Court Rules 2001, r.6.01(3)
Penalty Interest Rates Act 1983, s.2
Magistrates' Court Act 1971, s.100(7)
Supreme Court Act 1958
County Court Act 1958

Nugent v Brialkim Pty Ltd & Anor (1985) 61 ALR 725
Boorowa Shire Council v Booth [2001] FMCA 31
Herchenroder & Anor v Smith [2003] FMCA 96
David Sarikay v Victorian WorkCover Authority [1997] FCA 1372
Adams v Lambert (2005) 225 ALR 396
Quitstar Pty Ltd v Cooline Pacific Pty Ltd (2002) 41 ACSR 491
Foot v Midwest Finance Pty Ltd (1997) 78 FCR 306

Applicant Creditor:

JENNIFER IRENE JONES

Respondent Debtor:

ROBIN ARTHUR VERITY

File number:

MLG 1236 of 2006

Judgment of:

McInnis FM

Hearing date:

4 May 2007

Delivered at:

Melbourne

Delivered on:

12 July 2007

REPRESENTATION

Counsel for the Applicant Creditor:

Mr J. Geale

Solicitors for the Applicant Creditor:

Keith Elliott

Counsel for the Respondent Debtor:

Mr J. Dunne

Solicitors for the Respondent Debtor:

Dibbs Abbott Stillman

ORDERS

The Creditor's Petition be dismissed.
Costs reserved.
Liberty to apply is granted to the parties in relation to the issue of costs.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLG 1236 of 2006

JENNIFER IRENE JONES

Applicant Creditor

And

ROBIN ARTHUR VERITY

Respondent Debtor

REASONS FOR JUDGMENT

In these proceedings, Jennifer Irene Jones (the Applicant Creditor), by a creditor's petition filed 2 October 2006, seeks a sequestration order against Robin Arthur Verity (the Respondent Debtor).
The Applicant Creditor relies upon a bankruptcy notice, number VN1511 of 2006, which was issued on 15 August 2006 (the notice).
The Respondent Debtor has sought to raise as a preliminary issue, in opposition to the creditor's petition, namely a claim that the notice is defective and that it is fundamentally flawed as a result of not disclosing a proper address for the creditor in any part of the notice. Further, it is sought to be argued that the notice is invalid on the ground that the schedule of interest and interest calculation does not comply with the bankruptcy rules on the ground that there is no specification as to the source of the interest claimed.
At the commencement of the proceedings the court determined that it was appropriate to resolve the preliminary issues concerning the validity of the notice relied upon by the Applicant Creditor in this petition. It is evident that there are now two issues which I shall refer to as follows:
·The creditor's address
·Statement of interest
It should also be noted that in the event that the court determines on the preliminary issue that the notice is valid, then the parties will be given an opportunity to be further heard in relation…

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 Jones v Verity

Details

AGLC: Jones v Verity [2007] FMCA 1108
Case: [2007] FMCA 1108
Decision Date: 12 July 2007

CaseChat Overview and Summary

Jones and Verity appeared before the Federal Circuit and Family Court of Australia in a dispute concerning the enforcement of a creditor's petition against Verity. The petitioner, Jones, sought to enforce the creditor's petition, which was predicated on an outstanding debt that Verity owed to Jones. The case centred on whether the creditor's petition was validly issued and whether the court had the jurisdiction to enforce it.

The primary legal issue the court had to determine was whether the creditor's petition was correctly issued and if the court had jurisdiction over the matter. The court had to consider the procedural requirements for issuing such a petition and whether any procedural errors rendered the petition invalid. Additionally, the court needed to examine whether it had the jurisdiction to hear the creditor's petition and enforce the debt.

In its judgment, the court held that the creditor's petition was not validly issued as it did not comply with the procedural requirements set out in the relevant legislation. The court found that there were significant procedural errors in the issuance of the petition, which rendered it invalid. Consequently, the court concluded that it did not have jurisdiction to enforce the petition. The court dismissed the creditor's petition and reserved costs, granting liberty to apply for costs to both parties.

Orders

Orders of the court

The Creditor's Petition be dismissed.

Costs reserved.

Liberty to apply is granted to the parties in relation to the issue of costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citations

AGLC Citation

Jones v Verity [2007] FMCA 1108

Most Recent Citation

McKean Park (A Firm), in the matter of Lawrence v Lawrence [2011] FCA 1291

Cases citing this decision · 7 of 7 shown

Nand v Fuji Xerox Australia Pty Ltd
[2015] FCAFC 51 Para 19

…argued that that decision, that the trial judge followed, was wrong and that instead the decision of the Federal Magistrates Court in Jones v Verity [2007] FMCA 1108, which North J overruled, should be preferred. We are unable to identify any error in North J’s reasoning that the debtor before him had been correct…
Fuji Xerox Australia Pty Limited v Nand
[2014] FCCA 2793 Para 1

…that this was a matter in respect of which s.306 of the Act could not remedy. The Respondent relied on two authorities in this regard, Jones v Verity [2007] FMCA 1108, and Chulio & Anor v Kelly [2010] FMCA 193, approving and following Jones v Verity . Both decisions were decisions of Federal Magistrates (as they th…
McKean Park (A Firm), in the matter of Lawrence v Lawrence
[2011] FCA 1291 Para 3

…Court Act in the interest calculation section of the bankruptcy notice. Such an omission was held by the Federal Magistrates Court in Jones v Verity [2007] FMCA 1108 ( Jones ) to invalidate the bankruptcy notice. Consequently, the registrar referred the application for determination by this Court.…
Chulio v Kelly
[2010] FMCA 193 Para 9

…I note that, consistent with my view, in Jones v Verity [2007] FMCA 1108 McInnis FM found that a failure in a bankruptcy notice to refer to any Act of Parliament giving rise to an entitlement to interest involved “ a failure to comply with the requirement made essential by the Act ” (at [83]). In the interests of j…
Apps v Campbell
[2010] FMCA 1 Para 3

…ndent placed reliance on the decision in Jones v Verity [2007] FMCA 1108 in which McInnis FM found that the failure in a bankruptcy notice to refer to any Act of Parliament giving rise to an entitlement to interest involved “ a failure to comply with the requirement made essential by the Act; namely, to specify ‘th…
GR Finance Limited v Francis Waldron
[2009] FMCA 418 Para 10

…The respondent placed reliance on the decision in Jones v Verity [2007] FMCA 1108 in which McInnis FM found that the failure in a bankruptcy notice to refer to any Act of Parliament giving rise to an entitlement to interest involved “ a failure to comply with the requirement made essential by the Act; namely, to sp…
GR Finance Limited v Josephine Waldron
[2009] FMCA 398 Para 10

…The respondent placed reliance on the decision in Jones v Verity [2007] FMCA 1108 in which McInnis FM found that the failure in a bankruptcy notice to refer to any Act of Parliament giving rise to an entitlement to interest involved “ a failure to comply with the requirement made essential by the Act; namely, to sp…

View all 7 citing cases →

Cases cited in this decision · 12 of 12 shown

Adams v Lambert
[2006] HCA 10 Para 15

…Reference was made to the High Court decision in Adams v Lambert (2005) 225 ALR 396. It was submitted in the present case that the address is a fundamental requirement of the notice and the address must be a place, as opposed to a PO Box address, where payment can be made. The fact that the debtor may have made payme…
Adams v Lambert & Anor
[2005] HCATrans 436 Para 15

…Reference was made to the High Court decision in Adams v Lambert (2005) 225 ALR 396. It was submitted in the present case that the address is a fundamental requirement of the notice and the address must be a place, as opposed to a PO Box address, where payment can be made. The fact that the debtor may have made payments…
Herchenroder & Anor v Smith
[2003] FMCA 96 Para 4

…Reference was made to decisions of Raphael FM in Boorowa Shire Council v Booth [2001] FMCA 31 (Boorowa Shire) and Herchenroder & Anor v Smith [2003] FMCA 96 (Herchenroder). It was submitted by counsel for the Respondent Debtor that the facts in each of the Federal Magistrates Court cases are "slightly different b…
Quitstar Pty Ltd v Cooline Pacific Pty Ltd
[2002] NSWSC 402 Para 7

…en the bankruptcy notice and a statutory demand and in the present case no substantial injustice has been occasioned by the error in the address (see Quitstar Pty Ltd v Cooline Pacific Pty Ltd (2002) 41 ACSR 491 at [17] (Quitstar)). In the Quitstar case it was noted that the court held that although a PO Box address had been given as an address fo…
Boorowa Shire Council v Booth
[2001] FMCA 31 Para 4

…Reference was made to decisions of Raphael FM in Boorowa Shire Council v Booth [2001] FMCA 31 (Boorowa Shire) and Herchenroder & Anor v Smith [2003] FMCA 96 (Herchenroder). It was submitted by counsel for the Respondent Debtor that the facts in each of the Federal Magistrates Court cases are "slightly different b…
Sarikaya v Victorian Workcover Authority
[1997] FCA 1372 Para 12

…n paragraph 9 of the decision in Boorowa Shire to the decision of Black CJ in Sarikay is a reference to David Sarikay v Victorian WorkCover Authority [1997] FCA 1372. It was submitted by the Respondent Debtor's counsel that the decision of the Federal Court referred to service on a PO Box not constituting an addre…
Foote v Mid-West Finance Pty Ltd
[1997] FCA 990 Para 8

…on in Herchenroder was referred to: “9. The question of the appropriate address is also discussed by Foster J in Foot v Midwest Finance Pty Limited (1997) 78 FCR 306 at 307 where His Honour said: “Clearly, the underlying rationale of these cases is that the bankruptcy notice must make clear to the debtor what he or…
Ma S. v Farrow Mortgage Services Pty Ltd (In liq)
[1995] FCA 636 Para 3

…behalf to secure or compound the debt". Reference was made to the decision of the Full Court of the Federal Court in Nugent v Brialkim Pty Ltd & Anor (1985) 61 ALR 725 (Nugent) where the court relevantly states at p.726 the following: “Judgments of long standing have held in relation to comparable provisions in the…
Nugent v Brialkim Pty Ltd
[1985] FCA 416 Para 3

…t can be made with him or on his behalf to secure or compound the debt". Reference was made to the decision of the Full Court of the Federal Court in Nugent v Brialkim Pty Ltd & Anor (1985) 61 ALR 725 (Nugent) where the court relevantly states at p.726 the following: “Judgments of long standing have held in relation to comparable provisi…
James v Federal Commissioner of Taxation
[1955] HCA 75 Para 3

…one of them, or some agent authorized on his or their behalf, may be found: see Re Beauchamp Ex parte Beauchamp [1904] 1 KB 572 and James v FC of T (1955) 93 CLR 631 at 639. The question before this court must be considered in the light of the following passage from James’ case (at p 639): “It is the duty of a debto…
[2002] NSWCA 329
[2002] NSWCA 329 Para 7

…mand and in the present case no substantial injustice has been occasioned by the error in the address (see Quitstar Pty Ltd v Cooline Pacific Pty Ltd (2002) 41 ACSR 491 at [17] (Quitstar)). In the Quitstar case it was noted that the court held that although a PO Box address had been given as an address for service, t…
[1904] 1 KB 572
[1904] 1 KB 572 Para 3

…he, or, if more than one, they, or one of them, or some agent authorized on his or their behalf, may be found: see Re Beauchamp Ex parte Beauchamp [1904] 1 KB 572 and James v FC of T (1955) 93 CLR 631 at 639. The question before this court must be considered in the light of the following passage from James’ case…

Legislation cited in this decision · 11

Bankruptcy Act 1966 (Cth)
306, 306(1) 3 mentions (from Para 1)
Federal Magistrates Court Rules 2001 (Cth)
6.01(3) 2 mentions (from Para 4)
Penalty Interest Rates Act 1983 (Vic)
2 2 mentions (from Para 7)
Acts Interpretation Act 1901 (Cth)
1 mention (from Para 5)
Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs
1 mention (from Para 7)
County Court Act 1958 (Vic)
1 mention (from Para 7)
Courts Act 1971 c.23
1 mention (from Para 7)
Penalty Interest Rate Act 1983 (Vic)
1 mention (from Para 3)
Property Law Act 1958 (Vic)
1 mention (from Para 7)
Supreme Court Act 1958 (Vic)
1 mention (from Para 7)
Transfer of Land Act 1958 (Vic)
1 mention (from Para 7)