Jovanovski v Official Receiver, Australian Financial Security Authority
[2018] FCCA 1193
•18 May 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| JOVANOVSKI v OFFICIAL RECEIVER, AUSTRALIAN FINANCIAL SECURITY AUTHORITY | [2018] FCCA 1193 |
| Catchwords: BANKRUPTCY – Application for order that Statement of Affairs be treated as having been filed with the Official Receiver on a date earlier that in fact filed –sequestration order made in 2014 – applicant requested to complete and file Statement of Affairs within 14 days of being notified of sequestration order – applicant provided with Statement of Affairs for completion on more than one occasion – failure to complete Statement of Affairs – failure to attend interview – refusal to provide residential address – effect upon administration of bankrupt estate – applicant asserts Statement of Affairs filed by delivery to trustee rather than to Official Receiver – delivery by express post – delivery by hand – credibility of witnesses – non-disclosure of material facts – amending filing date of Statement of Affairs – relevant principles – no subjective belief that Statement of Affairs filed as some earlier date than in fact filed – no objective basis for asserted belief – discretionary factors weigh against grant of relief – application refused – unsolicited submissions filed without leave – finality of litigation and attendant pressure on Court – submissions not read. |
| Legislation: Acts Interpretation Act 1901 (Cth), s.15AB |
| Cases cited: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT) (2009) 239 CLR 27 |
| Other texts cited: Pearce and Geddes, Statutory Interpretation in Australia 8th Ed (2014) |
| Applicant: | LUPCO JOVANOVSKI |
| Respondent: | OFFICIAL RECEIVER, AUSTRALIAN FINANCIAL SECURITY AUTHORITY |
| Interested Person: | ROBERT SCOTT WOODS |
| File Number: | MLG 385 of 2018 |
| Judgment of: | Judge A Kelly |
| Hearing date: | 7 May 2018 |
| Date of Last Submission: | 8 May 2018 |
| Delivered at: | Melbourne |
| Delivered on: | 18 May 2018 |
REPRESENTATION
| Solicitor appearing as advocate for the Applicant: | Mr Weinberger |
| Solicitors for the Applicant: | KCL Law |
| Solicitor appearing as counsel for the Respondent: | Ms Curnow |
| Solicitors for the Respondent: | The Australian Government Solicitor |
| Counsel for the Trustee: | Mr Morris |
| Solicitors for the Trustee: | Marsh & Maher Richmond Bennison |
ORDERS
The application be dismissed.
In default of agreement, by 4.00pm on 30 May 2018, the parties file submissions (not exceeding 3 pages, 12 font, 1.5 spacing) in relation to any application concerning the costs of and incidental to this application.
Contents
Introduction
Evidence
June 2014 – Sequestration order and requests for Statement of Affairs
August 2014 – Completion and filing of Statement of Affairs?
September 2014 – Official Receiver’s attempt to obtain statement
September 2014 – Delivery?
January 2015
18-22 June 2015 – Attendance at 550 Bourke St
September 2015 – Delivery?
April 2016 – A business opportunity
November 2016 – Tele-conference
Loss of diary and computer
Request to correct NPPI
Other matters
Procedural history
Applicable principles
Consideration
(i) The application of s 33A
(ii) Completion of the Statement of Affairs
(iii) A subjective belief that the statement had been filed
(iv) Reasonable grounds for a belief that statement had been filed
(v) Discretion
Unsolicited submissions
Conclusion
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 385 of 2018
| LUPCO JOVANOVSKI |
Applicant
And
| OFFICIAL RECEIVER, AUSTRALIAN FINANCIAL SECURITY AUTHORITY |
Respondent
REASONS FOR JUDGMENT
Introduction
These reasons for judgment explain why orders are made dismissing an application pursuant to s 33A of the Bankruptcy Act 1966 (Cth) (the Act) seeking an order that the applicant’s Statement of Affairs be treated as having been filed at a time before it was actually filed.
On the findings that I have made, the Statement of Affairs was furnished to the trustee of the applicant’s bankrupt estate on 24 September 2015 who, on that date, transmitted it by email to the Official Receiver. The statement was accepted by the Official Receiver on 28 September 2015. According to the National Personal Insolvency Index (NPII), the applicant’s Statement of Affairs was filed on 24 September 2015.
The applicant, Mr Jovanovski, accepts that he never filed the Statement of Affairs with the Official Receiver. He variously contends that it was delivered to his trustee’s office at 550 Bourke St, Melbourne: (a) by post, on 8 August 2014, and; (b) by hand, on 29 September 2014, in May 2015 and on 22 June 2015.
In each case, delivery of the Statement of Affairs was said to have been effected by his former bookkeeper, Mr Wayne Yurisich.
On the submissions made on the application, the central issues are whether Mr Jovanovski believed that his Statement of Affairs had been filed with the Official Receiver on 29 September 2014 or 22 June 2015 and if so, whether he held such belief on reasonable grounds.[1] I do not accept that Mr Jovanovski held such a belief. Nor would I have accepted that he had reasonable grounds for doing so. Further, as a matter of discretion, I would have refused such relief.
[1] Any claim that the Statement of Affairs had been filed in May 2015 was not pressed.
Evidence
The applicant relied upon his affidavit made on 14 March 2018. He also relied upon affidavits by Mr Yurisich, his solicitor (Mr Weinberger), and a litigation assistant, Ms Eloise Callinan. Mr Weinberger’s affidavit was not read, although the documents exhibited to it were relied upon without objection. Ms Callinan was not cross-examined.
Mr Jovanovski’s affidavit deposed to the basis for his asserted belief that his Statement of Affairs had been filed at a time before it was actually filed. The applicant referred to the affidavit of Mr Yurisich and deposed to his belief as to the truth of the events to which Mr Yurisich had deposed. In addition, Mr Jovanovski deposed to his discussions with the trustee, members of the trustee’s staff and to the reasons of a delegate of the Inspector-General dated 21 December 2017, for refusing to amend the NPII as concerned the date on which the Statement of Affairs was filed.
Mr Jovanovski and Mr Yurisich were cross-examined. In addition to the affidavit which Mr Yurisich made in this proceeding, he had earlier made a statutory declaration touching upon the same issues as were addressed in his affidavit.
An affidavit was filed by the Official Receiver, being an affidavit made by Mrs Oberoi who was not cross-examined upon her affidavit.
A series of affidavits were filed on behalf of the trustee. Only the trustee, Mr Woods, and his Senior Analyst, Mr Tornatore, were cross-examined upon their affidavits.
The sequence of events as revealed by the evidence contained in those affidavits and the viva voce evidence given at the hearing is as follows.
June 2014 – Sequestration order and requests for Statement of Affairs
On 10 June 2014, a sequestration order was made against the estate of Mr Jovanovski. From the NPII index it appears that an order for the sequestration of the applicant’s estate was made upon the petition of a creditor, Tang Investment Company Pty Ltd.
Upon the making of the sequestration order, Mr Robert Woods, a member of Deloitte Touche Tohmatsu (Deloitte), was appointed as trustee of Mr Jovanovski’s bankrupt estate. Mr Woods is a registered trustee. Upon his appointment, the trustee instructed Mr Tornatore and an accountant, Mr Shaun Fernando, to assist him in the administration of the bankrupt’s estate.
On 12 June 2014, Mr Tornatore held a telephone conversation with Mr Jovanovski in the course of which he told him of the making of the sequestration order. Mr Jovanovski replied that he knew nothing about the matter. Mr Tornatore told Mr Jovanovski that he was required to make out and file a Statement of Affairs and to lodge it within 14 days with the Official Receiver of the Australian Financial Security Authority (AFSA). Mr Jovanovski was told that it would be an offence for him to not comply with his obligation to complete and file a Statement of Affairs. He was also told that he faced the prospect of being referred to the Fraud Investigations Unit of AFSA if he did not comply with this obligation. Mr Jovanovski replied that he would not be intimidated by threats and would only be concerned if he was going to be arrested. When asked whether he had any assets Mr Jovanovski replied that he used to be worth $50M and that he now had nothing.
During this conversation, Mr Tornatore asked, and Mr Jovanovski refused, a request to provide the trustee with his residential address. Mr Jovanovski provided Mr Tornatore with his email address.
Mr Tornatore said that he would transmit an email notifying Mr Jovanovski of his bankruptcy and provide him with correspondence advising of his obligations as an undischarged bankrupt, including a Statement of Affairs for his completion and return. Mr Tornatore reiterated that Mr Jovanovski should complete his Statement of Affairs within 14 days and asked that Mr Jovanovski contact him during the following week to discuss the affairs relating to his bankruptcy further.
On 13 June 2014, Mr Tornatore sent Mr Jovanovski an email to which he attached: (a) a letter of that date from the trustee; (b) a copy of the trustees’ certificate of appointment; (c) an authority to release information in relation to Part A of the bankrupt’s Statement of Affairs; (d) a warning bulletin concerning a bankrupt’s responsibilities under the Act, and; (e) a pro forma Statement of Affairs for completion and return.
The trustee’s letter dated 13 June 2014 notified Mr Jovanovski of the making of the bank sequestration order and of the trustee’s appointment. As concerned the Statement of Affairs, the trustees’ letter advised Mr Jovanovski that he was required by s 54(1) of the Act to make out and lodge with the Official Receiver a Statement of Affairs in the prescribed form not later than 14 days from the date on which he was notified of the bankruptcy. After warning Mr Jovanovski that a failure to lodge the Statement of Affairs within the prescribed time may attract a penalty, the trustee advised as follows:
Please note that the statutory three (3) year period of your bankruptcy commences from the date you file your Statement of Affairs with the Official Receiver. (Emphasis added)
The trustees’ letter advised Mr Jovanovski of his obligations as concerned delivery of the completed Statement of Affairs as follows:
When completed, you are required to: –
·forward the ORIGINAL Statement of Affairs to the Official Receiver at GPO box 1550, Adelaide, SA 5001 or via email at [email protected]; and
·forward a COPY of the Statement of Affairs together with all documents specified therein to my office, level 17, 550 Bourke St, Melbourne, Vic 3000. (Emphasis added)
The trustees’ letter proceeded to inform Mr Jovanovski of his obligation to attend upon the trustee as reasonably required for an interview and that he should contact Mr Tornatore (whose telephone number was provided) to do so. The letter offered Mr Jovanovski assistance, stating:
If you require assistance with the Statement of Affairs, assistance can be provided at the interview.
The trustees’ letter then addressed the effects of bankruptcy and did so in some detail. The letter concluded by reiterating that Mr Jovanovski’s bankruptcy would operate for a period of three years from the date that he filed his Statement of Affairs and warned him that the bankruptcy may be extended in certain circumstances.
Mr Jovanovski was also invited to consider a composition or scheme of arrangement with his creditors. The trustee offered to furnish further information on these options if required. The letter concluded by inviting Mr Jovanovski to contact Mr Tornatore on receipt of the letter.
Mr Jovanovski did not complete, file or lodge a Statement of Affairs with the Official Receiver or the trustee respectively within the prescribed 14 day period. Nor did he contact Mr Tornatore or attend an interview with him to discuss his bankruptcy. However, on 14 July 2014, Mr Tornatore and the trustee attended a meeting with the solicitor then acting for Mr Jovanovski. The meeting was for the purpose of discussing certain litigation in which Mr Jovanovski was involved. The trustee observed that Mr Jovanovski had failed to complete a Statement of Affairs and refused to provide the trustee with his residential address. Mr Jovanovski’s solicitor agreed that he would forward correspondence to Mr Jovanovski as requested by the trustee.
On 15 July 2014, Mr Tornatore sent an email to Mr Jovanovski’s solicitor requesting that he forward that email and attachments to his client. One attachment to that email comprised a further blank copy of the Statement of Affairs. The email reminded Mr Jovanovski that he would be eligible for discharge from bankruptcy three years after the filing of his Statement of Affairs with the Official Receiver and that if the statement was not lodged he may be bankrupt indefinitely. Mr Tornatore’s email reiterated that Mr Jovanovski was free to obtain assistance from him if required and noted that Mr Jovanovski had previously obtained assistance from an insolvency specialist and may wish to contact him instead of dealing with the trustee directly.
On 16 July 2014, Mr Jovanovski’s solicitor sent him an email attaching the trustees’ email of 15 July 2014 and enclosures stating in part:
Please print and sign the Statement of Affairs and return it . . .
Should you have any queries, please contact Mr Tornatore directly.
August 2014 – Completion and filing of Statement of Affairs?
Mr Yurisich’s affidavit deposed to having assisted Mr Jovanovski on 8 August 2014 to complete a Statement of Affairs.
The evidence of Mr Yurisich and Mr Jovanovski is to be gauged in the context of matters that were not disclosed in their affidavits.
When Mr Yurisich was cross-examined he was asked to explain why he came to assist in the completion of the Statement of Affairs. He suggested that he had no qualifications or experience to render that assistance. He then agreed that he had in fact been made bankrupt following the failure of a travel agency business which he operated. He agreed that he had been prosecuted by Consumer Affairs Victoria in 2002. He agreed that he had entered a plea of guilty to the charges laid against him. He agreed that one of the charges laid against him was for failing to have a registered business name. He initially said that he had “not to my knowledge” been prosecuted for failing to keep proper records of the business. He added that he could not “remember that back far now.” It was only when pressed upon the circumstances of the failure of the travel agency that he agreed there had been a deficiency in his trust account for some $260,000. Yet he was equivocal in relation to the charges to which he had entered a plea of guilty. Mr Yurisich also professed to have no knowledge of proceedings conducted in the Federal Court of Australia in relation to the failure of his business or the deficiency in the trust account. An examination of a judgment indicates that although proceedings were commenced against Mr Yurisich, the claim was not pursued against him and further, he took no part in an appeal in that proceeding: see King (as Trustee of the Travel Compensation Fund) v Yurisich (2006) 234 ALR 425, [44].
Mr Jovanovski also gave evidence that Mr Yurisich had been his book keeper prior to his bankruptcy. Mr Jovanovski deposed that Mr Yurisich had “always been honest in my dealings with him”, and that he could think of no reason whatsoever why he would lie about delivering his Statement of Affairs on 29 September 2014 and 22 June 2015.
Mr Jovanovski was cross-examined in relation Mr Yurisich’s travel agency business. He denied knowing when Mr Yurisich was involved in the travel agency. He denied knowing that the business had failed. When asked whether he knew that Mr Yurisich had been prosecuted by Consumer Affairs Victoria, Mr Jovanovski initially agreed to knowing of the prosecution, but then said that he did not know of it.
When cross-examined in relation to the preparation of the Statement of Affairs, the evidence of Mr Jovanovski and Mr Yurisich varied.
Mr Jovanovski said that it was because Mr Yurisich had been his book keeper in business before his bankruptcy that he had assisted him to complete the Statement of Affairs. He said that Mr Yurisich had “actually gathered the information together and put it together for me”. He also said that they had exchanged drafts to complete the Statement of Affairs by a series of emails. Mr Jovanovski said that he had signed the Statement of Affairs in Queensland in the presence of Mr Yurisich.
Mr Yurisich deposed and confirmed in cross-examination that he had assisted Mr Jovanovski in completing a Statement of Affairs on 8 August 2014. When cross-examined, Mr Yurisich said that he had assisted Mr Jovanovski to complete the Statement of Affairs “in person.” He said that he had completed the Statement of Affairs in conjunction with Mr Jovanovski and that it was he, Mr Jovanovski, who had “told me what to include” in the boxes of the statement.
Mr Jovanovski deposed that in August 2014 he lived in Queensland and, as Mr Yurisich lived in Melbourne, he had asked Mr Yurisich to deliver the Statement of Affairs to the trustee. Based upon his acceptance of the truth of Mr Yurisich’s affidavit, Mr Jovanovski deposed that he believed the Statement of Affairs had been posted to the trustee in August 2014.
Mr Yurisich deposed that he could recall posting the Statement of Affairs, adding “but [I] understand it was not delivered until much later. I do not know why it was not delivered after I posted it to the trustee.”
A photocopy of an Australia Post express post envelope was tendered in evidence. In the space provided on the envelope for the addressee’s details to be completed, the format of the envelope allowed for the following: company name; contact name; post office box number or street address; suburb or town; state and postcode. The envelope as completed by Mr Yurisich provided only details as follows:
Contact name Robert Woods
Street address 550 Bourke Street
Suburb Melbourne
State and postcode VIC, 3000
Although the envelope provided for the addressee’s company name to be completed, this had not been done. Deloitte was not referred to. Mr Tornatore’s letter dated 14 June 2014 provided Deloitte’s full address. Mr Yurisich did not include a reference to Level 17 either.
In addition, the envelope bore the annotation “Posted 8/8/14.”[2]
[2] The word ‘Posted’ and the postage date ‘8/8/14’ appear to be in different ink.
The express post envelope also bore a tracking reference number 60518138332099 and a barcode with the notation “tracking where available: auspost.com.au/track.” This tracking system was employed by Mr Tornatore and a delegate of the Inspector-General in due course.
In a statutory declaration made on 7 August 2017, Mr Yurisich declared that he had posted the Statement of Affairs by express post on 8 August 2014 to the trustee at 550 Bourke Street, Melbourne. Mr Yurisich’s declaration included a reference to the tracking reference number 60518138332099. Mr Yurisich’s declaration stated that the express envelope had been posted by him in an express post box in Park Street, South Melbourne and stated that it had not been returned.
As appears below, Mr Tornatore’s evidence was that he first met Mr Yurisich on 24 September 2015 at the reception area of Deloitte. At that time, he was given the Statement of Affairs together with a copy of the express post envelope.
On 24 September 2015, Mr Tornatore conducted a search using the express post tracking number of that envelope. Based on his search Mr Tornatore concluded that the envelope had never been posted. Mr Tornatore produced a copy of his express post tracking search dated 24 September 2015. An entry on that search stated “No events currently found.” Mr Tornatore exhibited a copy of his Austrack search.
In the course of an investigation by the Inspector-General in bankruptcy, enquiries were made of Australia Post on 9 November 2017 to ascertain the movement of the express post envelope by reference to its tracking reference number. Those enquiries revealed the following:
(a)the tracking reference number had expired internally;
(b)in August 2017, an external party had made enquiries about the movement of the same tracking reference number;
(c)an internal file note created by Australia Post confirmed that delivery of the express envelope took place on 3 December 2015.
September 2014 – Official Receiver’s attempt to obtain statement
On 4 September 2014, AFSA sent the trustee a letter which noted that Mr Jovanovski had not yet filed a Statement of Affairs.
The Official Receiver’s letter foreshadowed the issue of a notice under s 77CA of the Act.[3] Non-compliance with such a notice attracts criminal sanctions. To effect service of the s 77CA notice, the Official Receiver required the trustee to provide certain information relating to Mr Jovanovski including his current residential address.
[3]Section 77CA confers power on the Official Receiver by written notice given to a trustee to furnish a Statement of Affairs within 14 days. A failure to comply with such notice is an offence: s 267B.
The trustee completed the Official Receiver’s request for information stating in part: “the bankrupt has refused to provide his residential address to the trustee” and advised that the bankrupt had been notified of his obligation to file a Statement of Affairs.
On 18 September 2014, AFSA wrote to the trustee stating that the Official Receiver could not issue a notice under s 77CA of the Act as AFSA had no confirmed current address of Mr Jovanovski. AFSA requested the trustee to provide documentary evidence confirming the address details of the bankrupt.
September 2014 – Delivery?
Mr Yurisich deposed that shortly before Monday, 29 September 2014, Mr Jovanovski called him and told him that the trustee had not received the Statement of Affairs. Mr Yurisich said that he was asked to deliver a copy of the Statement of Affairs to the trustees’ office. While Mr Jovanovski deposed that he believed the contents of Mr Yurisich’s affidavit to be true, he did not distinctly depose to having had any such conversation with Mr Yurisich. Nor did Mr Jovanovski depose to having been told in September 2014 that the trustee had not received a completed Statement of Affairs. On the evidence before me, the last occasion that the topic may have been raised with Mr Jovanovski was on 16 July 2014, when his solicitor forwarded to him Mr Tornatore’s email, attaching another copy of the Statement of Affairs for completion.
Mr Yurisich deposed that he delivered a copy of the Statement of Affairs on 29 September 2014. Mr Yurisich deposed that when he arrived in ‘the lobby’ at 550 Bourke Street, he spoke to a person and told him that he had to deliver some documents to Robert Woods. Mr Yurisich deposed that the person with whom he spoke told him that he should leave the documents downstairs at the mail desk.
Mr Yurisich deposed that he made the delivery, going ‘downstairs’ from the lobby where he observed an area where people were working behind a glass window accepting documents. Mr Yurisich said that he gave a copy of the Statement of Affairs to a person telling them that the statement had to be delivered to Robert Woods at Deloitte to which the recipient of the delivery said “okay”.
Mr Yurisich deposed that he spoke with Mr Jovanovski by telephone, telling him that he had delivered the Statement of Affairs by leaving it at Mr Woods’ building adding “that I was not permitted upstairs to Deloitte’s office”. Mr Yurisich did not give that evidence in the body of his affidavit when dealing with the alleged delivery on 29 September 2014. Mr Jovanovski deposed that Mr Yurisich called him by telephone and informed him that he had delivered the Statement of Affairs “to Mr Woods firstly by leaving it at the building because he was not allowed upstairs to Mr Woods’ office and secondly to Mr Woods’ office when he was permitted upstairs.”[4]
I understood Mr Jovanovski’s evidence as referring to the two distinct occasions on which Mr Yurisich told him that he had left a copy of the Statement of Affairs at 550 Bourke St, the first being on 29 September 2014 and the second being on 22 June 2015.
Mr Yurisich deposed he was certain that this visit took place in September 2014 and not September 2015 because he recalled travelling to the city from Port Melbourne where he was working at the time.
Mr Yurisich’s version of these events as detailed in his affidavit stood in contrast to that contained in his statutory declaration.
By his statutory declaration, Mr Yurisich declared that on 29 September 2014, he had attempted to deliver a copy of the Statement of Affairs to Deloitte’s office but that he had been unable to gain access to the office stating that “it was left with security at reception for delivery to Deloitte.” The more natural implication of Mr Yurisich’s statement that the document had been so left for delivery suggests that Mr Yurisich meant he had left the Statement of Affairs with security at reception with a request that it be delivered to Deloitte on his behalf.
Contrastingly, Mr Yurisich’s affidavit sworn on 14 March 2018 made no mention of having handed the Statement of Affairs on 29 September 2014 either to a security officer or to having left it at reception. The account contained in his affidavit was that he spoke to a person in the ‘lobby’ and, upon saying that he had to deliver a document to Mr Woods, was told to “leave the documents downstairs at the mail desk.”
Cross-examined on this topic, Mr Yurisich said that, when making his affidavit in March 2018, he had had more time to think about the matter than at the time of making his statutory declaration in August 2017. Re-examined about the events of 29 September 2014, Mr Yurisich maintained categorically that his account of those events was true, adding that he had not been asked to sign a log when he made the delivery to the mailroom: (T.39).
Mr Woods deposed that that the mailroom located at 550 Bourke Street was not accessible to the general public by going downstairs from the lobby and was accessible only via Ramsay Lane. The trustee relied upon this evidence to challenge Mr Yurisich’s evidence that he had simply “gone downstairs” from the lobby of 550 Bourke Street to the mailroom. Mr Woods deposed that in the many years that he had been at Deloitte, there had been no security personnel at 550 Bourke Street, Melbourne.
A litigation assistant employed by the applicant’s solicitor, Ms Callinan, attended 550 Bourke Street, Melbourne on 28 March 2018 for a delivery and was directed to deliver documents to the mailroom. Ms Callinan also made investigative phone calls to ascertain the mailroom practices employed at 550 Bourke Street both in 2018 and 2014.
Ms Coman, a mailroom manager employed by Wilson Security at 550 Bourke St, deposed as to the standard practices employed in relation to persons seeking to deliver documents including that:
(a)documents were not accepted by the concierge;
(b)a person with a delivery was directed to an area, Level B1, which was occupied both by building security staff and mailroom staff who accepted documents from couriers and others;
(c)mailroom staff individually catalogued each delivery with the name and contact details of the persons making delivery along with the date and time of delivery;
(d)thereafter, mailroom staff delivered the documents to tenants;
(e)in the case of mail for delivery to Deloitte, deliveries were made to Deloitte’s mailroom located on level 9 of the building.
As concerned deliveries made on 29 September 2014 and 22 June 2015, Ms Coman examined and reviewed the records of deliveries made to the mailroom on Level B1 and could not identify that Wayne Yurisich had made any deliveries to the mailroom on any of those dates.
In turn, Mr Woods retrieved and examined the records of deliveries made to the Deloitte mailroom on 29 September 2014 and 22 June 2015. His evidence was that there was no record of Mr Yurisich having made any deliveries to the Deloitte mailroom on either date. He produced the records of deliveries to the Deloitte mailroom for both dates.
In the course of his evidence, Mr Jovanovski stated on several occasions that in September 2014 (at the time he had asked Mr Yurisich to deliver the Statement of Affairs), he had believed the Official Receiver and trustee to be one and the same person (T.19-20, 26, 28-29).[5] Mr Jovanovski confirmed that he had not given evidence to that effect anywhere in his affidavit.
[5]He also suggested that he thought Mr Woods and Mr Tornatore was one and the same person: “I thought one was one and the one was the other. That was my understanding.”
January 2015
On 29 January 2015, Mr Tornatore and the trustee then held a telephone conversation with Mr Jovanovski. The first topic of their discussion concerned the disclaimer by the trustee of the chose in action in certain legal proceedings. The trustee advised Mr Jovanovski that he still had not filed his Statement of Affairs. The trustee stated that either he or Mr Tornatore would be able to provide Mr Jovanovski with assistance if he required it. The trustee further advised Mr Jovanovski that the sooner the Statement of Affairs was completed, the sooner he would be discharged from bankruptcy and so could move forward. Mr Jovanovski replied he was not in the frame of mind to be entrepreneurial and further that he was not 100% sure of his creditors. The conversation concluded with the trustee advising Mr Jovanovski that he should complete the Statement of Affairs to the best of his ability and knowledge. Mr Tornatore kept a handwritten file note of this telephone conversation which was exhibited to his affidavit.
Mr Yurisich deposed that in January 2015 he received a phone call from Mr Jovanovski. He swore that he could not recall the exact date but believed it to be close to 21 January 2015. In the course of this conversation, Mr Jovanovski told Mr Yurisich that the trustee had said he had not received the Statement of Affairs. Mr Jovanovski asked him to deliver another copy of the Statement of Affairs to the trustees’ office. Mr Yurisich deposed that he attended the lobby at 550 Bourke Street, on 21 January 2015 to deliver a further copy of the Statement of Affairs to Mr Woods but, upon being told to leave the documents downstairs at the mail desk, he did not do so because “I had previously followed those instructions and the trustee claimed he did not receive the Statement of Affairs.” Having regard to Mr Yurisich’s concession that he could not recall the exact date of the January 2015 phone call with Mr Jovanovski, I find it more probable that this conversation occurred on or after 29 January 2015. It also seemed more probable that Mr Jovanovski’s request for Mr Yurisich to deliver a copy of the statement was a direct result of the foregoing conversation.
Mr Jovanovski deposed that while he too could not recall the exact date of a discussion (or indeed whether it was a discussion with the trustee or with one of his associates), he said that he could recall saying to the trustee that he believed he had filed a Statement of Affairs and volunteered that “by this time I believed Mr Yurisich had delivered it to his office on 29 September 2014 and I wanted to know when my bankruptcy was going to end.”
Mr Jovanovski further deposed that as a result of his discussion with the trustee (or one of his associates), he asked Mr Yurisich to again deliver a copy of the Statement of Affairs to the trustee at 550 Bourke St. Mr Jovanovski deposed that Mr Yurisich agreed to do so but then called him to report that “he was not permitted upstairs to Mr Woods’ office and so he left the building.”
Mr Jovanovski’s affidavit touched in the most superficial way upon the discussion held on 29 January 2015, deposing that “I do recall saying to Mr Woods that I believed that I had filed a Statement of Affairs.” This evidence was put to Mr Tornatore (who had participated in the call) and he denied Mr Jovanovski had made that statement.
18-22 June 2015 – Attendance at 550 Bourke St
It appears that nothing further occurred as concerned the Statement of Affairs in the period February – May 2015. Mr Jovanovski said that he had not followed up on the delivery of the Statement of Affairs from January 2015 until around June 2015 by reason of the birth of his son and that he had been struggling financially.
On 18 June 2015, the trustee received an email from a creditor of the bankrupt’s estate enquiring as to whether Mr Jovanovski had filed a Statement of Affairs. The trustee responded the following day advising that Mr Jovanovski had been uncooperative during his bankruptcy and had not completed a Statement of Affairs.
Mr Yurisich said that he spoke with Mr Jovanovski in June 2015 and was asked to deliver a copy of the Statement of Affairs to the trustee. He attended 550 Bourke Street on 22 June 2015, and was directed to leave the document with the mail desk. Mr Yurisich said that on this occasion, he telephoned Mr Jovanovski to inform him that again he had not been permitted to hand the documents to the trustee. Mr Jovanovski told Mr Yurisich not to leave the building and instead to wait while he, Mr Jovanovski, made a phone call to the trustee’s office. Mr Yurisich said that after a phone call he was permitted to go upstairs to the Deloitte reception area. Mr Yurisich went upstairs, waiting in the Deloitte reception area until being attended by a colleague of the trustee. He said that the colleague, who took the Statement of Affairs, told him that he would give ‘the document’ to the trustee. Having done so Mr Yurisich telephoned Mr Jovanovski on 22 June 2015 stating that he had delivered the Statement of Affairs to a colleague of the trustee.
Cross-examined about the events of 22 June 2015, Mr Yurisich maintained categorically that his account was true: (T.37-38). He ascribed the accuracy of his recall of this attendance, in part, to having been employed at the time in Port Melbourne and to not having travelled into the city after he finished his employment in June 2015.
While Mr Jovanovski deposed that he spoke with Mr Yurisich after his attendance at 550 Bourke Street on 22 June 2015, his affidavit did not depose to any conversation before such attendance. Mr Jovanovski deposed that he called the Deloitte’s office on 22 June 2015 asking one of the trustees’ colleagues so as to allow Mr Yurisich to deliver a copy of the Statement of Affairs to the trustee. Mr Jovanovski deposed that Mr Yurisich told him afterwards that he had given the Statement of Affairs to “a young man who worked with Mr Woods” and for that reason he believed the Statement of Affairs had been filed with the Official Receiver “in the ordinary course of his role as my trustee.”
The trustee made a call for production of certain telephone records by Mr Jovanovski. In response to the call, a data log of usage details for Mr Jovanovski’s mobile phone was produced. The data log had been heavily redacted save that five entries remained visible. Each of the entries that were visible related to calls which had been made on 22 June 2015. Mr Jovanovski confirmed that each of these calls had originated from his mobile phone and had been for between 20 seconds and one minute 36 seconds in duration. It also emerged that the redactions which had been made to this data log had been made by Mr Yurisich and not Mr Jovanovski. Neither of those witnesses was able to explain the location of the original data log.
Nor was any explanation given for the non-production of the equivalent data log relating to the usage details of Mr Yurisich’s own mobile phone. The available data log evidence did not prove the making of telephone calls by Mr Jovanovski to Deloitte on 22 June 2015. Thus, it was not possible to correlate the un-redacted five entries from the data relating to Mr Jovanovski’s mobile phone with a data log of any corresponding calls which had been made to or from Mr Yurisich’s mobile phone or to Deloitte on that date.
On 11 July 2017, Mr Yurisich transmitted an email to Mr Jovanovski addressing the subject “Info as requested.” Mr Yurisich’s email identified a timeline of the events relating to the alleged postage and delivery of bankruptcy forms on 8 August 2014, 29 September 2014, 21 January 2015 and 22 June 2015 respectively. He concluded:
On my calculations Bankruptcy should be completed as at 09/08/2017.
According to Robert Woods bankruptcy will not be completed until 08/08/2018 I believe.
September 2015 – Delivery?
Mr Tornatore deposed that on 23 September 2015 he received a call from Mr Jovanovski during which he was asked for an update regarding his estate. Mr Tornatore told Mr Jovanovski that “as he had not yet filed his Statement of Affairs, the bankruptcy administration of his estate was continuing.” Mr Tornatore deposed that during this conversation Mr Jovanovski said that he had sent his Statement of Affairs to the trustee in August 2014. Mr Tornatore responded that there was no record of a Statement of Affairs being received. In this conversation, as recounted by Mr Tornatore, Mr Jovanovski then stated that he had spoken with AFSA which had confirmed receipt of his Statement of Affairs. Mr Tornatore then provided Mr Jovanovski with his email address and asked that he provide a copy of his Statement of Affairs. Mr Tornatore produced his file note of this discussion.
When cross-examined on this topic it was put to Mr Tornatore, and denied by him, that on 23 September 2015, Mr Jovanovski had asserted he had sent the Statement of Affairs whereupon Mr Tornatore had, so it was said, then searched for the statement, located it on the file and lodged it on the following day. Mr Tornatore denied this was so: (T.63-64). It was further put that Mr Tornatore had then telephoned AFSA on 25 September 2015. Cross-examined as to whether Mr Tornatore had failed to file a Statement of Affairs in a timely manner on any other occasion, Mr Woods denied that he had failed to do so: (T.85).
Following this conversation, Mr Tornatore then contacted AFSA and asked whether Mr Jovanovski had lodged his Statement of Affairs. Mr Tornatore was told that no Statement of Affairs had been received from Mr Jovanovski. Mr Tornatore made a file note of these events.
On 23 September 2015, Mr Tornatore telephoned Mr Jovanovski telling him that neither the trustee nor AFSA had a record of having received a Statement of Affairs from him. Mr Tornatore deposed that Mr Jovanovski replied he would “arrange for his friend, Wayne Yurisich, to deliver a copy to the trustee at Deloitte’s offices.” On this occasion, Mr Tornatore did not make a file note of his conversation. He confirmed during his evidence that Mr Jovanovski had made this statement during this telephone conversation on that date.
Mr Tornatore further deposed that on 24 September 2015 he received a call from Deloitte’s reception and was informed that Mr Yurisich had arrived to deliver a document to the trustee. Mr Tornatore went from his office and met Mr Yurisich who handed him both a copy of Mr Jovanovski’s Statement of Affairs together with a photocopy of the express envelope. Neither Mr Yurisich’s statutory declaration nor his affidavit deposed to his having given Mr Tornatore a copy of the express post envelope when he had met him at Deloitte’s reception (whether that occurred in September 2014 or 2015). Mr Yurisich merely deposed that Mr Woods’ colleague “took the Statement of Affairs from me and told me he would give it to Mr Woods.”
In the course of cross-examination, Mr Tornatore said that Deloitte’s practice was not to ‘date stamp’ formal documents of this kind (as distinct from correspondence that had been delivered by hand). He also confirmed that Deloitte’s policy was to lodge a Statement of Affairs on the date that it was received.
Having received those documents, Mr Tornatore transmitted a copy of the Statement of Affairs to AFSA by email. Mrs Oberoi’s evidence was that on 24 September 2015, AFSA received the bankrupt’s Statement of Affairs and that it had been filed electronically via AFSA’s email [email protected]. Mrs Oberoi produced an extract from the NPII which recorded that Mr Jovanovski’s Statement of Affairs had been filed on 24 September 2015.
Following receipt of the Statement of Affairs, Mrs Oberoi wrote to the trustee confirming that the statement received on 24 September 2015 was accepted by AFSA on 28 September 2015. On the latter of those dates, Mr Woods sent an email to Mr Tornatore informing him that the Official Receiver had accepted the Statement of Affairs. Cross-examined as to this, Mr Woods said the email from AFSA confirming acceptance of the statement was a standard form email: (T.79).
Mr Tornatore produced a copy of the Statement of Affairs which he had been given by Mr Yurisich on 24 September 2015. Mr Jovanovski’s declaration was signed and dated 8 August 2014. The Statement of Affairs was also signed by Mr Yurisich, and dated 8 August 2014. He declared that the responses provided were those of Mr Jovanovski.
Mr Woods also produced a copy of a work in progress report related to the period 1 September 2014 to 5 October 2015 which, he deposed, contained no entries suggesting that the Statement of Affairs had been received before 24 September 2015. Cross-examined on the issue, Mr Woods said that Deloitte’s policy required time costing to be done on a weekly – not a daily – basis: (T.86).
The work in progress report contained three entries as follows:
Tornatore, 23/09/2015 administration fees senior SR analyst 0.2 telephone call bankrupt regarding Statement of Affairs; drafting of file note in IPS; search of NPII;
Tornatore, 24/09/2015 administration fees SR analyst 0.6 lodgement of Statement of Affairs with AFSA; meeting with bankrupt’s agent to accept delivery of SOA; perusal of SOA; phone call with AFSA;
Tornatore, 5/10/2015 creditors – fees SR analyst 4.5 drafting of report to creditors.
Mr Tornatore gave evidence that he had assisted in the preparation of this work in progress report for the purpose of it being made an exhibit to Mr Woods’ affidavit. He explained that the information contained in the report had been extracted from one software program and copied into an excel program so it could be presented in a landscape format.
Mr Tornatore was challenged over the absence of any reference in the work in progress report entries to his having spoken with Mr Jovanovski on 23 September 2015 (i.e. to advise him that neither the trustee nor AFSA had a record of having received a Statement of Affairs from him). Mr Tornatore readily accepted there was no such reference in the report.
Both Mr Woods and Mr Tornatore gave evidence that Deloitte’s standard practice required the completion of file costing by entry into the work in progress report on weekly intervals. It is apparent that such costing records were drawn in part from primary records such as the accountant’s file notes.
April 2016 – A business opportunity
Mr Jovanovski deposed that he had held discussions with the trustee in “about 2016 about the date my bankruptcy was going to end.” He deposed that he wanted to pursue a business opportunity but could not do so whilst he was bankrupt. He provided no further detail.
On 18 April 2016, the trustee had a telephone conversation with Mr Jovanovski who told him that he had a business opportunity “doing bus transfers and sightseeing tours”. Mr Jovanovski told Mr Woods that he wanted someone to run the business for him and wanted to know what restrictions were imposed upon him as a bankrupt. After being advised of the applicable restrictions, Mr Jovanovski made an enquiry of the trustee about the possibility of proposing a composition with his creditors (apparently making an offer of $20,000 in respect of creditors whose debts amounted in aggregate to $3.5M). Mr Woods told Mr Jovanovski that such a proposal was unlikely to be effective or to provide a return to creditors.
Mr Jovanovski’s Statement of Affairs was mentioned during this conversation. Mr Jovanovski stated he had a photo of an express post envelope confirming that he had sent in his Statement of Affairs some time ago. Mr Woods asked Mr Jovanovski to send a copy of that photo to him. The trustee produced his file note of that conversation.
Mr Woods said that on 18 April 2016, Mr Jovanovski sent him an email attaching a copy of the express post envelope in which he stated:
As discussed this morning, this is the copy of the Aust post envelope that was sent to you.
The handwriting on the doc is that of Wayne Yurisich who assisted me with the completion of the document and he is happy to provide you with a sworn statement of the delivery etc.
Wayne is also the one that personally hand-delivered the document in the end to Robert Tornatore.
As you know at the time nearly 2 years ago I was in no state to complete the docs on my own and hence Wayne helped me out.
Can you please take this into consideration to the bankruptcy start date and possibly discharge date.
Upon receipt of this email, Mr Woods sent the email on to Mr Tornatore asking whether Mr Yurisich had hand-delivered the Statement of Affairs to him. The trustee’s email stated:
The way this email reads is that Wayne hand-delivered the SOA to you. I don’t believe that to be the case, can you please confirm whether or not this occurred.
Mr Tornatore responded to Mr Woods’ query the same date. His email included the following account:
Lu Jovanovski contacted our office in Sep 2014, he wanted to know his date of discharge and I said that he hadn’t filed his SOA.
– He said that he had sent it to AFSA and gave us a copy in August 2014. I said we didn’t get it and I called AFSA.
– They didn’t get it either.
– Lu then provided that same copy of the envelope that he sent to you. It was never sent by registered post and I checked that serial number online – there’s no record of it been delivered.
– Consequently, Lu arranged for Wayne to hand deliver his SOA to me in September 2015.
– So yes I did receive the SOA from Wayne – but in September 2015, not when Lu is referring to below.
– There will be a file note of a discussion on file in early Jan/Feb 2015, where we were both talking to Lu about completing his SOA . . .
In cross-examination, Mr Woods said that the only time he could recall Mr Jovanovski asserting that the Statement of Affairs had already been filed was in the conversation held (and in the email sent) on 18 April 2016 attaching the express post envelope: (T.85-86).
On 16 May 2016, Mr Jovanovski sent a further email to the trustee asking whether the trustee had considered his request and confirming that he could raise up to $20,000 towards an early discharge “if that’s any good”, adding that he had gone back to his family and asked “for up to 100k as you mentioned but I have no hope.”
November 2016 – Tele-conference
Mr Fernando, an accountant employed by Deloitte, swore an affidavit stating that on 22 November 2016 he received a telephone call from Mr Jovanovski enquiring as to the anticipated date of discharge of his bankruptcy. Mr Fernando deposed that during this phone call he had been told by Mr Jovanovski that he had filed his Statement of Affairs in May 2015 so that in his view he ought to be discharged in May 2018.
Mr Fernando responded to this statement telling Mr Jovanovski that Deloitte’s records indicated that his Statement of Affairs had been filed on 24 September 2015. Mr Jovanovski then asked Mr Fernando whether there was anything he could do to obtain an earlier discharge date. Mr Fernando replied that Mr Jovanovski could propose a composition for his creditors consideration or make application to the Court but that “it was not a matter the trustee could decide.”
Loss of diary and computer
Mr Yurisich deposed that he was certain that the dates on which he deposed to having visited 550 Bourke Street were correct because he had recorded them in his diary. However his affidavit further deposed that he had thrown out his diaries in about March 2017.
Mr Yurisich had also deposed that before disposing of his diaries he had transposed the dates relating to these events “in a spreadsheet which I saved on my computer.” Mr Yurisich then deposed that he had thrown out that computer but had not done so before checking it on 11 July 2017 (being the date on which had sent an email to Mr Jovanovski). In this email, Mr Yurisich provided a list of “the dates of each visit and a summary of what occurred each time.” The email to Mr Jovanovski addressed the subject “Info as requested.” Mr Jovanovski’s affidavit did not address any request by him for the provision of that information. Mr Yurisich’s email stated as follows:
Timeline as follows:
08/08/2014 posted bankruptcy forms to Robert Woods (express post attached)
29/09/14 left copy of forms with security as not able to access floor to leave [documents]
21/01/2015 again tried to deliver forms but denied access to floor did not leave forms with security as last lot was not received
22/06/2015 when again was unable to access floor, called Lu and said not to leave but to ensure it was hand delivered
After several discussions with security access was granted to floor and copy of forms was hand delivered
On my calculations bankruptcy should be completed as at 09/08/2017
According to Robert Woods bankruptcy will not be completed until 08/08/2018
The circumstances which had prompted Mr Yurisich to send this email on 11 July 2017 were not explained by the evidence. As noted, the basis for Mr Yurisich’s belief in July 2015 that Mr Woods considered that the bankruptcy would not be completed until 8 August 2018 was not explained by any evidence.
When cross-examined on this series of events, Mr Yurisich was insistent that his email was 100% correct (T.36).
Request to correct NPPI
On 7 August 2017, Mr Jovanovski wrote to the Inspector-General providing a history of the events over the period 8 August 2014 – 18 April 2016 as he contended them to be. Mr Jovanovski’s letter recorded that the trustee had denied receipt of the Statement of Affairs by express post and contended that it had not been delivered to him until September 2015. Mr Jovanovski requested review by the Inspector-General of the trustee’s decision not to agree to the discharge of his bankruptcy before September 2018. The history of the matter outlined in Mr Jovanovski’s letter was as follows:
(1)I was declared bankrupt on 10 June 2014. On 16 July 2014, my solicitors, Tisher Liner FC Law, emailed me a copy of the Statement of Affairs. At that time and subsequently, I suffered from a mental illness;
(2)On 8 August 2014, I completed the Statement of Affairs with the assistance of my friend Mr W Yurisich;
(3)On 8 August 2014, the Statement of Affairs was posted to Mr Woods by express post by Mr Yurisich;
(4)On 29 September 2014, I copy (sic) of the Statement of Affairs was left with security at 550 Bourke Street, Melbourne to Mr Yurisich as access was not available to Deloitte Touch Tohmatsu;
(5)On 21 January 2015, an attempt was again made to deliver a copy of the Statement of Affairs but Mr Yurisich was denied access to the office;
(6)On 22 June 2015, a further copy of the Statement of Affairs was delivered to the trustee’s office by Mr Yurisich;
(7)By email dated 18 April 2016 to Mr Woods, I attached a copy of the express post envelope;
(8)By email dated 16 May 2016, Mr Woods denied receipt of the Statement of Affairs by express post and claimed that the Statement of Affairs was not delivered until September 2015;
(9)I am attaching with this letter a statutory declaration signed today by Wayne Yurisich confirming each of the matters referred to . . .
Mr Jovanovski attached a copy of Mr Yurisich’s statutory declaration. Mr Jovanovski did not distinctly address the date on which Mr Woods had decided not to agree to Mr Jovanovski’s discharge from bankruptcy before September 2018.
On 15 November 2017, the Official Receiver wrote to Mr Jovanovski advising that it was not considered appropriate to amend the filing date of the Statement of Affairs and informed him of his right to apply to the Court for such relief. The Official Receiver drew attention to s 33A of the Act, advised that it would not oppose such an application adding that it would offer any assistance the Court may require.
By letter dated 24 November 2017, Mr Jovanovski’s solicitor wrote to AFSA requesting that a correction be made to the NPII as to the date of Mr Jovanovski’s bankruptcy on the ground that it was “inaccurate or misleading.” The request was grounded upon the exercise of powers conferred by para 13.04(1)(c) of the Bankruptcy Regulations 1996 (Regulations).
Mr Jovanovski’s solicitor recorded his instructions that when Mr Jovanovski had requested a review of the trustees’ decision not to agree to the change of date of bankruptcy, he had been “informed by the Inspector-General’s office that they could not review the decision because he had not lodged a Statement of Affairs with AFSA, as he was required to do.” Mr Jovanovski’s solicitor attributed the failure to lodge the Statement of Affairs with AFSA to the trustee stating: “the trustee never informed him that he had to provide a copy of his Statement of Affairs to AFSA and that had he been told that he needed to do so he would have done so.” This was repeated in Mr Jovanovski’s affidavit.
During their communications with the Inspector-General during late 2017, it was not suggested by Mr Jovanovski or his solicitor that Mr Jovanovski had believed, in September 2014, that the Official Receiver and trustee were one and the same person. Different points were being taken. Mr Jovanovski’s contentions were that he should have been told by his trustee to file the statement with the Official Receiver and that had he been so told, he would have done so.
Mr Jovanovski’s solicitor contended that his client should be excused from his failure to provide the Statement of Affairs to AFSA and on that basis sought a favourable exercise of power “pursuant to section (sic) 13.04(1)(c) of the Bankruptcy Regulations.”
On 21 December 2017, a delegate of the Inspector-General decided not to amend Mr Jovanovski’s discharge from bankruptcy date recorded on the NPII. The delegate provided a statement of reasons for that decision. The delegate made findings as follows:
a.On 10 June 2014, the applicant had been made bankrupt and was obliged by operation of s 54 of the Bankruptcy Act to file a Statement of Affairs within 14 days from the day on which he had been notified of the bankruptcy;
b.Robert Woods administered the bankrupt estate as registered trustee;
c.On 24 September 2015 the applicant’s Statement of Affairs had been filed by the trustee with the Official Receiver;
d.The applicants’ expected bankruptcy date was 25 September 2018;
e.On 8 August 2017 the applicant requested a review of the decision not to backdate the filing of the Statement of Affairs;
f.The delegate had contacted Australia Post with respect to the use in August 2014 of an express post tracking reference number 60518138332099. The delegate ascertained that:
i.The tracking reference number 60518138332099 had expired internally;
ii.In August 2017 an external party had made enquiries about the same tracking reference number;
iii.An internal Australia Post file note created at the time of that enquiry confirmed that delivery of the express post had taken place on 3 December 2015.
g.On 9 November 2017 the trustee had provided the Inspector-General with his analysis of the sequence of events including that:
i.In January 2015 the applicant had made enquiries as to his discharge from bankruptcy of the trustee and been told in response that the applicant had yet to file a Statement of Affairs and for that reason there was no expected discharge date;
ii.The applicant contended he had already filed a Statement of Affairs but could not recall whether he had lodged it with the Official Receiver or the trustee;
iii.Later, the applicant provided the trustee with a copy of the tracking reference number 60518138332099 as proof of the Statement of Affairs having been lodged;
iv.The trustee had checked that tracking reference number which enquiries revealed that it had not been used or scanned;
v.The trustee had received the applicant’s Statement of Affairs in September 2015 and subsequently lodged a copy of it with the Official Receiver;
vi.Persons delivering mail to the office of the trustee were directed to deliver it to the mailroom;
vii.Based on the trustees practices and procedures it was considered unlikely any mail would have been accepted by a security officer in the building or that the mail would go missing or that a person attempting to deliver mail would not be directed to deliver to the mailroom of Deloitte Touche Tohmatsu.
The delegate concluded that the date for Mr Jovanovski’s discharge from bankruptcy as recorded in the NPII was not inaccurate or misleading, reasoning there had been no compliance with the obligation to lodge the Statement of Affairs until September 2015 and that, insofar as Mr Jovanovski relied upon the use of an express post envelope, enquiries had revealed that the envelope had not been delivered until 3 December 2015. The delegate considered that there was no proper basis on which to characterise Mr Jovanovski’s attempts to deliver the Statement of Affairs as constituting a formal defect or irregularity within the meaning of s 306 of the Act. In substance, the delegate decided that:
In this case, there was simply no compliance with the legislation by the Applicant, even if he was of the belief that giving a SOA to the [trustee] constituted filing with [Official Receiver], or that the [trustee] had received the SOA in or around August 2014, instead of September 2015, and had failed to forward the SOA to the Official Receiver.
From my review of the delegate’s reasons for her decision, no express finding was made whether Mr Jovanovski believed that the Statement of Affairs had been filed with the Official Receiver.
Other matters
Mr Woods deposed that it had always been his practice to assist persons who were bankrupt including by lending his aid in relation to their Statement of Affairs. He gave evidence that it was not common for a bankrupt to deliver the Statement of Affairs directly to his office and that his more common experience was that bankrupts complied with the obligation to file the Statement of Affairs directly with the Official Receiver. However, on the occasions when bankrupts did send the Statement of Affairs only to him as trustee, Mr Woods’ practice was to forward the document to the Official Receiver. In cross-examination, Mr Woods maintained that he always lodged the statement when it was received from a bankrupt directly: (T.76). In re-examination, Mr Woods gave as an example, a situation in which the bankrupt had attended an interview and the trustee provided assistance in its completion. In such a case, he would email the statement to the Official Receiver: (T.88).
Mr Woods deposed that there was no reason for staff or him to avoid receiving a Statement of Affairs or to obstruct the delivery of such document. Mr Woods gave evidence that the Statement of Affairs was important for a variety of reasons including that it assisted his enquiries and investigations and enabled him to provide a more informative report to creditors. He also deposed that the absence of a Statement of Affairs made more difficult the role of administering the estate. For example, the absence of a Statement of Affairs would necessitate the making of an application to the Court for leave to distribute dividends where there were available funds for the creditors.
Mr Woods’ evidence was that he did not receive the bankrupt’s Statement of Affairs until it was given to him by Mr Tornatore on 24 September 2015. Mr Woods has conducted a review of the file relating to the administration of Mr Jovanovski’s estate. He has also spoken to all staff currently working at Deloitte who have had involvement in the administration of the file. His evidence, which I accept, is that there is no document indicating that the Statement of Affairs was received by Deloitte at any time before 24 September 2015. Mr Woods also observed that although his email address was publicly available via Deloitte’s website (and had been so available prior to the making of the sequestration order), his file contained no indication that Mr Jovanovski, Mr Yurisich or any other person had communicated at any time to indicate that they have been unable to furnish the trustee with the bankrupt’s Statement of Affairs.
Procedural history
On 14 February 2018, Mr Jovanovski filed an application in this Court seeking an alteration of the filing date of the Statement of Affairs pursuant to s 33A of the Act, together with an order that the Statement of Affairs be treated as having been filed on 29 September 2014. By his application, only the Official Receiver was named as respondent.
The application indicated that it was intended to serve the process both on the Official Receiver, AFSA and upon Mr Woods, as his trustee.
The application was supported by an affidavit, affirmed on 14 February 2018 by Mr Jovanovski’s solicitor, Mr Weinberger. While this affidavit was not read at the hearing, the documents exhibited by that affidavit were relied upon without objection.
Mr Jovanovski’s solicitors notified the trustee of the filing of the application by email sent on 16 February 2018. Upon receipt, Mr Woods replied, observing that he had not been named as a party and, having no funds in the administration, determined it was not appropriate to engage lawyers or to file an appearance.
On Friday, 2 March 2018, the Official Receiver advised Mr Jovanovski’s solicitor that it considered it was premature to consent to the application without an oral hearing as it did not yet know whether the trustee intended to be heard on the application.
On 2 March 2018, Mr Weinberger sent Mr Woods an email at about 3:30pm which stated in part “kindly advise of your position by reply no later than 12pm on Monday, 5 March 2018.”
On 5 March 2018, Mr Woods responded to Mr Jovanovski’s solicitor by email giving notice that the trustee’s version of events differed from his client’s version of events.
AFSA also contacted the trustee in relation to the proceeding.
On 5 March 2018, Mr Woods sent an email to AFSA providing Mr Tornatore’s version of events with respect to the delivery of the Statement of Affairs including the checks which he had made to confirm that the document had not been received either at Deloitte or at AFSA before 24 September 2015. He also recorded that enquiries had been made of Australia Post by Mr Tornatore to confirm that there was no record of the express mail envelope being delivered. Mr Woods also informed AFSA that while he had been contacted by Mr Jovanovski’s solicitor, he had informed him that he did not intend to be heard and had told him that his understanding of the history of events was different to that now contended for in Mr Weinberger’s affidavit.
By a further email sent on 5 March 2018, Mr Woods advised AFSA that, upon a review of his file he had found other references which confirmed that the Statement of Affairs had not been received before September 2015. In this email, Mr Woods reiterated that he was always willing to provide assistance to a bankrupt in relation to a Statement of Affairs. He recorded that on 29 January 2015, Mr Jovanovski had said that he was “not 100% sure of his [creditors]” and that he had been told he should complete the statement to the best of his ability and knowledge.
Mr Woods’ further email reiterated his view that he had a vested interest in accepting a Statement of Affairs from a bankrupt explaining that it would assist him in the completion of his duties. He also stated that it was his practice (and he instructed staff) to go out to reception or to the foyer of the Deloitte building to meet with a bankrupt or collect a Statement of Affairs “if someone turned up unannounced”. For those reasons, Mr Woods observed that he considered it curious that Mr Weinberger’s affidavit stated the trustee had refused to “receive the SOA.” Mr Woods’ email also observed that the affidavit indicated Mr Jovanovski was presenting a version of events which differed from that which had previously been adopted by him; namely, that he had sent the Statement of Affairs to the trustee by express post.
On 6 March 2018, there was an email exchange between the Official Receiver and the trustee in which the Official Receiver advised it would attend the hearing and abide the Court’s ruling. In reply, Mr Woods sought to clarify his position, stating that he did not object to the application being made as he considered this was Mr Jovanovski’s right.
The matter was called on for directions on 6 March 2018. On that date, I addressed the possible inadequacies in the available evidence with Mr Jovanovski’s solicitor. With a view to affording Mr Jovanovski an opportunity to present all available evidence, I noted that there was presently no evidence as to the circumstances in which the trustee had come to be in possession of the Statement of Affairs which had been filed by him with the Official Receiver on 24 September 2015.
This notation was made in the context that the Official Receiver had indicated that it would not oppose the application. Directions were made for the filing of affidavits and submissions.
The making of those orders led to the involvement of the trustee.
Following this hearing, the Official Receiver communicated with the trustee expressing a view that as trustee of the bankrupt estate, he considered that Mr Woods was a proper party who had an interest in the administration of the estate including the discharge of Mr Jovanovski from bankruptcy and that he should file an answering affidavit.
Then followed an exchange with Mr Jovanovski’s solicitor on 13 March 2018, in which Mr Woods gave a detailed account of the sequence of events as revealed upon an examination of the file, commencing from the making of the sequestration order to the giving of notice of the filing of the application. Mr Woods invited Mr Jovanovski to withdraw the application giving notice that he would rely upon his email on the question of costs. Mr Jovanovski’s solicitor responded that the trustee should put his version of events to the Court. When the trustee instructed solicitors, a further request was made that the application be withdrawn. Mr Jovanovski declined to do so.
In those circumstances, on 23 March 2018, the trustee made application for leave to be heard in a proceeding pursuant to r 2.03 of the Federal Circuit Court (Bankruptcy) Rules 2016. Following an exchange of affidavits, orders were made, by consent, on 3 May 2018 that the trustee be granted such leave. Consequential orders were made adjusting the timetable for the filing of submissions by the trustee.
By written submissions, a further copy of which were provided at the hearing,[6] Mr Jovanovski’s solicitor provided a proposed minute of order in which alternative relief to that claimed in the application was sought. By the proposed minute, an order was sought that the Statement of Affairs actually filed with the AFSA on 24 September 2015 be deemed to have been filed on 29 September 2014; alternatively, that the statement be deemed to have been filed on 22 June 2015. No further alternatives were proposed that the Statement of Affairs be deemed to have been filed on either 8 August 2014 or in May 2015.
[6] Apparently filed by email at some stage beforehand.
Applicable principles
The parties submitted that there was little authority upon s 33A and the principles applicable to the present application.
By sub-s 54(1) of the Act, where a sequestration order is made, the bankrupt must within 14 days of being notified of the bankruptcy:
(a) make out and file with the Official Receiver a statement of his or her affairs; and
(b) furnish a copy of the statement to the trustee
Penalty: 50 penalty units
A failure to comply with the obligation created by sub-s 54(1) is an offence of strict liability: see sub-s 54(3). As noted above, the failure to comply with s 54 may be addressed further by the Official Trustee by the giving of a notice under s 77CA (which creates a separate offence).
The term ‘filed’ is not defined by section 5 of the Act. No discrete definition of the term is provided for the purposes of ss 54 or 149. Yet the term is defined for the purposes of s 33A. Where a document is required to be filed with the Official Receiver it must be sent to its office: Reg 16.02, Regulations.
The trustee had no power to agree to an early discharge of a bankruptcy. Upon effluxion of time, discharge is automatic by force of s 149.
By s 33 the Court is given power with respect to, amongst other things, the abridgment of times that are fixed by the Act. However, this power does not extend to abridgment of the three-year period prescribed by s 149 for the early discharge of bankruptcy: Nilant, (Trustee) v Macchia (1997) 78 FCR 419. In this appeal in the extensive Nilant litigation, the Full Court held that para 33(1)(c) of the Act did not confer power to abridge the time within which a bankrupt would be discharged as limited by sub-s 149(3). I note that the Full Court invited the trustee to consider whether s 33 might not confer such power. Having raised the issue, the Full Court concluded that it did not have power to do so but recognised that there may be many factual circumstances which cried out for a capacity in the Court to ameliorate injustice which existed by reason of the absence of this power. Spender, Carr and Finn JJ stated at 428:
It is unlikely that Parliament, in introducing the new regime now found in Part VII of the Act, intended a statutory framework so rigid as to be unfair in particular circumstances. In our view it would work an injustice in factual situations . . . where there is a reasonable excuse for a bankrupt not filing his or her Statement of Affairs within time.
The Court’s reasoning affirms that if a power was conferred of a Court to relieve from the failure to file a Statement of Affairs, a bankrupt seeking an early discharge from bankruptcy would still need a reasonable excuse for having not filed that statement: see at 428C-D.
In a later Nilant appeal, another Full Court held that s 306 of the Act did not confer power to convert a failure to comply with s 54(1) into compliance with it: Nilant v Macchia (2000) 104 FCR 238. The Full Court held that relief under s 306 was not available because the bankrupt had not made any attempt to comply with s 54(1): [34] (Carr J), [54], [64]-[65] (Weinberg J); see also Macchia v Nilant (Trustee) [2006] FCA 213, [39]-[43] (Siopsis J).
Following the 1997 Nilant appeal, it was not until 2002 that the lacuna in power was filled by the Bankruptcy Legislation Amendment Act 2002 which inserted s 33A into the Act. Section 33A conferred an express power on the Court to abridge the time provided by sub-s 149(3) for the automatic discharge of a bankrupt.
Section 33A is contained in Division 2 of Part III of the Act which comprises ss 27–37 and concerns the jurisdiction and powers of Courts in bankruptcy. Section 33A is titled Alteration of filing date for statement of affairs and provides:
(1)This section applies to a statement of affairs that was filed for the purposes of section 54, 55, 56B, 56F or 57 by a bankrupt, or by a person who later became a bankrupt.
(2)If the Court is satisfied that the person believed, on reasonable grounds, that the statement had already been filed at a time before it was actually filed, the Court may order that the statement is to be treated as having been filed at a time before it was actually filed.
(3)The Court cannot make an order that would result in the person being discharged from bankruptcy earlier than 30 days after the order is made.
(4)In this section:
“filed” includes presented, lodged or given.
The power to order that a Statement of Affairs be treated as having been filed at the time before it was actually filed is only engaged where the Court is satisfied that the person believed, on reasonable grounds, that the statement had already been filed at a time before it was actually filed. Where in a bankruptcy proceeding it is necessary to establish or for the Court to be satisfied as to a particular fact, it is sufficient for the Court to be satisfied as to that fact on the balance of probabilities: s 34A of the Act; cf ss 58, 183, 140 Evidence Act 1995 (Cth). Where the evidence does not disclose a proper basis for the requisite belief, the requirements of the section cannot be satisfied: cfAsuzu v The Council of NSW Bar Association [2015] FCCA 210.
Applied here, the Court must be satisfied that Mr Jovanovski believed, on reasonable grounds, that his Statement of Affairs had already been filed at a time before it was actually filed; that is, on 24 September 2015.
The parties commended for my consideration, the Explanatory Memorandum of the Bankruptcy Legislation Amendment Bill 2002 (EM): see para 15AB(2)(e) of the Acts Interpretation Act 1901 (Cth). Such a memorandum may be used to confirm that the meaning of the provision is the ordinary meaning conveyed by the text or to determine the meaning of a provision, where it is ambiguous, obscure or may, if given its ordinary meaning, be absurd: para 15AB(1)(a)-(b); see also Newcastle City Council v GIO General Limited (1997) 191 CLR 85, 99-100 (Toohey, Gaudron and Gummow JJ), 112-113 (McHugh J); CIC Insurance Limited v Bankstown Football Club Limited (1997) 187 CLR 384, 408 (Brennan CJ, Dawson, Toohey and Gummow JJ). However, the Court is not obliged to consider extrinsic materials such as Explanatory Memoranda in all circumstances: see Pearce and Geddes, Statutory Interpretation in Australia 8th Ed (2014) at [3.25]. Here, as there is a relative absence of authority, it is of some use to do so.
The general outline provided by cl 2 of the Explanatory Memorandum noted the need to address: (a) changes, unfairness and anomalies, including the operation of the early discharge arrangements; and (b) the lack of effective sanctions on uncooperative bankrupts. Clause 3 stated the objects of the Bill, which included the abolition of early discharge from bankruptcy as the present regime had been found wanting: cl 3(b).
The applicant’s solicitor relied upon cl 4(h) of the EM which proposed changes consequential to the stated objects of the Bill, including the conferral of a power on the Court in specified circumstances so as to be able to facilitate discharge from bankruptcy despite the bankrupt’s failure to meet the formal requirements for filing a Statement of Affairs. Attention might also be drawn to other stated objects of the Bill. Clause 4(v) of the EM proposed that a bankruptcy might not be annulled on full payment of debts unless interest was also paid on those debts.
Clause 78 of the EM proposed the insertion of s 33A stating:
. . . The effect of this new section is to allow the Court to order that a statement of affairs be treated as having been filed at a time before it was actually filed, provided that the Court is satisfied that the bankrupt believed on reasonable grounds that this statement had been filed at a time before it actually was filed. . . (Emphasis added)
Clause 78 should not, however, be read in isolation. As concerned the stated object of the Bill to provide effective sanctions on uncooperative bankrupts, I note cll 163-176 of the Bill introduced additional provisions to provide for objections to discharge from bankruptcy.
The terms of s 33A should be construed on the basis that they are intended to give effect to harmonious goals: CSL Australia Pty Limited v Minister for Infrastructure and Transport [2014] FCAFC 10 at [153] (Allsop CJ, Mansfield and Rares JJ agreeing). The Chief Justice cited the statement in Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at [70], where the plurality said:
A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions. Reconciling conflicting provisions will often require the Court “to determine which is the leading provision and which the subordinate provision, and which must give way to the other”. Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme. (Emphasis added)
Rather, I identify the different explanations as being basic matters about which there should have been no controversy. The fact of the controversy is a matter which I take into account in evaluating whether, on the balance of probabilities, I am satisfied for the purposes of sub-s 33A(2) that Mr Jovanovski believed that the Statement of Affairs had been filed on either 24 September 2014 or 22 June 2015.
A subjective belief that the statement had been filed
As the parties submitted, the central questions in an application pursuant to s 33A are whether the bankrupt held the requisite belief as to the date of filing of the Statement of Affairs and if so, whether there were reasonable grounds for such belief. If the Court is not satisfied that the applicant held such belief, no question arises as to whether there were reasonable grounds for the asserted belief.
In the assessment of this issue it is necessary to consider the demeanour of the witnesses.
I found Mr Jovanovski to be somewhat taciturn and guarded when he answered questions that were put to him. He was less than candid in acknowledging that he had known of Mr Yurisich’s prosecution and conviction in respect of the failure of the travel agency. Mr Yurisich was not a convincing witness. Demeanour aside, he appeared at times to speak as if from a script. His categorical insistence that his chronology of events was accurate was unpersuasive, particularly in light of the disposal of his diaries and computer at a time when delivery of the Statement of Affairs seemed an issue in which he had central involvement. I have identified the several instances in which the accounts of Mr Jovanovski and Mr Yurisich did not coalesce.
Mr Woods presented as an open and honest witness who was focussed on the discharge of his duties as trustee. Mr Tornatore was entirely candid and prepared to make concessions without being pressed to do so. He appeared entirely familiar with the administration of the estate and had a good recall of his dealings in the matter with Mr Jovanovski.
Mr Jovanovski’s affidavit acknowledged that he had not lodged a Statement of Affairs with the Official Receiver but said he could not recall having ever being advised by the trustee to do so, including during any of his discussions by telephone with the trustee, stating:
I believe that it was lodged by my trustee after Mr Yurisich delivered it to Mr Woods’ building and office, respectively, on 29 September 2014 and 22 June 2015. The trustee did not advise me after 22 June 2015 that he had not received the Statement of Affairs or that it has not been lodged by him. (Emphasis added)
Why Mr Jovanovski only selected 22 June 2015 as a date after which Mr Woods had failed to advise him of the need to file the original Statement of Affairs with the Official Receiver was not explained.
More importantly, the evidence given by Mr Jovanovski in his affidavit that he had believed that the Statement of Affairs had been lodged by Mr Woods after Mr Yurisich delivered it on 29 September 2014 and 22 June 2015 was quite inconsistent with his evidence at the hearing that at each of those times he believed Mr Woods and the Official Receiver to be one and the same person. Mr Jovanovski cannot have subjectively believed Mr Woods would have lodged the statement with the Official Receiver if his stated belief was that they were one and the same person.
The evidence is that the express post envelope was not received by the trustee in August 2014 or at any other time. The evidence does not indicate whether the express post envelope had been used for some other purpose (the Statement of Affairs having been delivered by hand on any other number of dates upon the applicant’s case). It was odd that the express post envelope was sent to the trustee on several occasions.
Mr Jovanovski made a series of attempts to rely upon his photograph of the express post envelope bearing Mr Yurisich’s notation “Posted 8/8/14.” I am less than convinced as to when Mr Jovanovski in fact completed the Statement of Affairs and when and for what purpose the express mail envelope was in fact used or posted by Mr Yurisich.
While Mr Yurisich may have been prepared to swear that he was categorically sure that he had delivered the Statement of Affairs on 29 September 2014 and 22 June 2015, equally he had categorically failed disclose in his affidavit or, until cross-examined, the fact of the failure of his travel agency, the deficiency in the trust account, the laying of charges by Consumer Affairs Victoria or the enter of a plea of guilty in relation to the charges which were laid against him. His unwillingness to make a concession that there had been a deficiency in his trust account of $260,000 was remarkable. His attempt to deny a recollection of the fact of the prosecution on the basis that it had been a long time ago was unbelievable. I have earlier noted the inconsistencies in the evidence as to the absence of a security guard at 550 Bourke Street, that the mailroom in the basement at Level B1 was not accessible to the public by going downstairs and that access was only available from an adjacent laneway. Other inconsistencies have also been noted.
I do not accept as reliable Mr Yurisich’s evidence that he delivered the Statement of Affairs to the trustee on either 29 September 2014 or on 22 June 2015. His account of events that occurred on 22 June 2015 largely correlates with the account given by Mr Tornatore of the events which happened on 24 September 2015 so far as he had involvement in them. Mr Yurisich did not meet Mr Tornatore twice.
Insofar as Mr Jovanovski sought to suggest that in January 2015, Mr Yurisich had not been permitted to go upstairs to Deloittes reception area, I reject that evidence. Mr Woods’ evidence was that he had a practice to go to meet bankrupts whether in the foyer or at reception and had instructed his staff to do likewise. Mr Tornatore did precisely that on the occasion when Mr Yurisich sought to meet him at reception.
Mr Woods’ evidence, which I accept, was that during his telephone conversation on 29 January 2015 no mention had been made by Mr Jovanovski to the trustee and Mr Tornatore of having posted the Statement of Affairs by express post on 8 August 2014 or of it being delivered on 24 September 2014. I find Mr Woods told Mr Jovanovski during this conversation that the Statement of Affairs still had not been received. Upon being reminded that this was so, it would have presented as an immediate opportunity for Mr Jovanovski to protest that the statement had already been sent by express post and delivered by hand. It is telling that Mr Jovanovski made no such protest.
The discussion on 29 January 2015 in relation to the Statement of Affairs was predicated on an implicit assumption that it had not been completed or filed. During this conversation, Mr Woods had told Mr Jovanovski that the trustee was willing to provide assistance. This was an obvious moment for Mr Jovanovski to have responded that he had already completed the Statement of Affairs and delivered it, by post in August 2014 and again, by hand, in September 2014. Rather than responding in that manner, Mr Jovanovski’s contribution to the discussion was only consistent with an acknowledgement that he had not in fact completed or filed the statement in that his explanation for not having done so was that he was “not 100% sure of his creditors.” Mr Woods replied that Mr Jovanovski was only required to complete the Statement of Affairs to the best of his ability and knowledge. Again, Mr Jovanovski made no attempt at this point to suggest that the statement had already been completed. A further opportunity arose in November 2016 when Mr Jovanovski called Mr Fernando. Again, there was no protest to his having already filed the statement.
The parties evidence in relation to the events of 29 January 2015 is to be considered in the context that the affidavits of Mr Tornatore Mr Woods were sworn on 16 and 23 March 2018 respectively. Although, on 6 March 2018 the hearing of the application was listed for 8 May 2018, no attempt was made by Mr Jovanovski to counter the evidence of those witnesses in relation to the matters discussed on 29 January 2015.
Mr Weinberger suggested that the applicant was prejudiced by undue reliance upon the evidence of the trustee and Mr Tornatore in relation to the discussion held on 29 January 2015. I reject that submission. Mr Jovanovski’s affidavit, sworn on 14 March 2018, touched in the most superficial way upon the discussion held on 29 January 2015. Mr Jovanovski merely deposed: “I do recall saying to Mr Woods that I believed that I had filed a Statement of Affairs.” I do not accept that evidence. In the same paragraph, Mr Jovanovski volunteered that he could not recall whether he in fact spoke to Mr Woods or to one of his associates. Nor could he recall the precise date of the conversation. Mr Jovanovski gave no attention to the other matters deposed to, by both Mr Woods and Mr Tornatore, as topics which had been discussed on 29 January 2015. Mr Jovanovski’s evidence was wholly inconsistent with the evidence of Messrs Woods and Tornatore that when the need for completion of a Statement of Affairs was raised, his response had been to the effect he was not 100% sure of the identity of his creditors. This response was more consistent with a concession by Mr Jovanovski that he had not in fact completed, filed or lodged his Statement of Affairs. I note that Ms Coman was not cross-examined and that her affidavit had deposed as to the results of her search in the mailroom delivery records on 29 September 2014 and 22 June 2015. Insofar as Mr Yurisich said he had not been asked to sign a mail log in the mailroom at Level B1, I do not accept that evidence.
At no stage in his evidence did Mr Jovanovski contest the evidence of Messrs Woods and Tornatore that he had been told he had not filed the Statement of Affairs. He was supplied a pro forma statement for completion on two occasions in 2014. He was offered assistance to do so in 2014 and again in 2015 and reminded that he may prefer to consult an insolvency specialist whom he had apparently used.
On the occasions that the need to complete and file a Statement of Affairs was raised with him, the obvious response was to have stated “I’ve already done it, it has been posted and hand delivered to you.” Mr Jovanovski never did so and when he did respond he adopted a stance which was only consistent with a tacit acceptance that the Statement of Affairs had not been filed. Those matters undermine the suggestion that he in fact believed the statement had been filed.
Equally, Mr Woods and Mr Tornatore gave an account of the matter that was inherently probable. The evidence which they gave was consistent with their contemporaneous records. It was also consistent with the emails and records of Mrs Oberoi of AFSA. Mr Tornatore was willing to make admissions against interest when particular aspects of his file notes were put to him. Otherwise, he presented as a forthright witness who was anxious to give his evidence honestly. I accept Mr Woods’ evidence that his experience of documents not being received by Deloitte in the course of his practice as trustee was rare.
I attach no significance to the omission in Mr Tornatore’s file note of his having held a discussion with Mr Jovanovski on 24 September 2015. The case theory which Mr Jovanovski seemed to suggest in this part of his case was that, upon being told by Mr Jovanovski that he had in fact lodged his Statement of Affairs with the trustee, Mr Tornatore had gone back to his file, found it and then sent it by email to the Official Trustee so as to remedy the suggested oversight: see at [76] above. Yet on the case made by Mr Jovanovski, there would not have been an occasion for him to have done so in September 2015. On his case, Mr Jovanovski maintained that his conversation had occurred on 22 June 2015. In any event, had a conversation occurred on 24 September 2015, the absence of a reference to it in Mr Tornatore’s file note may be explained by Mr Jovanovski having spoken with some other person at Deloitte, such as a receptionist, and not with Mr Tornatore. The relevant fact is that the conversation was a link in the chain of events which led to Mr Tornatore going to reception, meeting Mr Yurisich and receiving the Statement of Affairs. Records of those key events were made. I have found that they occurred on 24 September 2015. If there was an omission is was not material.
A different case was advanced by Mr Jovanovski in August 2017 when Mr Jovanovski instructed his solicitor to request a review by the Inspector-General of the trustee’s decision to not agree to the discharge of the bankruptcy before September 2018. Mr Jovanovski responded to an invitation from the Inspector-General to make submissions in support of an application to amend the NPPI pursuant to reg 13.04. At that time, according to his solicitors “Mr Jovanovski told the Inspector General’s office, . . . that the trustee never informed him that he had to provide a copy of his Statement of Affairs to AFSA.” Mr Jovanovski’s instructions were conveyed in the letter from his solicitors to the Inspector-General dated 24 November 2017 in which it was stated that “he understands the trustee usually provides a copy of the Statement of Affairs to AFSA to satisfy that obligation.” At trial Mr Jovanovski’s evidence was that, while he now knew the position to be different, his belief had been at all earlier times that he believed the trustee and the Official Receiver was one and the same person.
Mr Jovanovski’s submission to the Inspector-General sought to attribute blame upon the trustee for the failure to file a statement with the Official Receiver. His solicitor’s submission was that “any failure to provide a Statement of Affairs to AFSA ought to be excused since Mr Jovanovski, as a layperson, relied on his trustee who failed to inform him that he had to send a copy of the Statement of Affairs to AFSA and also failed to send it to AFSA himself” (emphasis added).
The difficulty with that submission was that in June 2014, the trustee had expressly informed Mr Jovanovski of that obligation in writing.
Insofar as Mr Jovanovski’s case was that he would have filed the statement if the trustee had told him to do so, the instructions contained in his solicitor’s letter and his evidence to the same effect ignore that by letter dated 12 June 2014 he was told explicitly of the need to both file the Original Statement of Affairs with the Official Receiver and at the same time provide a Copy of that statement to the trustee.
Ultimately, I am faced with a decision whether to accept the evidence of Mr Yurisich (who was ‘categorically’ sure he had delivered the Statement of Affairs to the mailroom on 29 September 2014 and via Deloitte’s reception, to Mr Tornatore, on 22 June 2015), or to accept Mr Tornatore’s evidence that such delivery occurred on 24 September 2015.
I do not make a finding that Mr Yurisich or Mr Jovanovski had lied or fabricated their evidence: Smith v New South Wales Bar Association (1992) 176 CLR 256, 271 (Deane J). It is sufficient to find, as I do, that their evidence was unconvincing: Minister for Immigration and Citizenship v SZNPG [2010] FCAFC 51, 115 ALD 303, [24] (North and Lander JJ); CQG15 v Minister for Immigration and Border Protection [2016] FCAFC 146, [66] (McKerracher, Griffiths and Rangiah JJ). The question in the present case is whether I am satisfied, to the requisite standard, of the matters addressed by sub-s 33A.
In all of the circumstances, I reject the submission that Mr Jovanovski in fact had a subjective belief that the Statement of Affairs had been filed on 29 September 2014 or 22 June 2015. Mr Jovanovski accepted that the Statement of Affairs had never been filed with the Official Receiver. The high watermark of his case was grounded on an assumption that a trustee in bankruptcy “usually provides a copy of the Statement of Affairs to AFSA to satisfy that obligation.”
For the reasons I have given, I prefer the evidence of Mr Tornatore, Mr Woods, Mrs Oberoi and Mr Fernando. I find Mr Yurisich in fact delivered the Statement of Affairs to Mr Tornatore on 24 September 2015 and that it was immediately filed by him with the Official Receiver who acknowledged receipt and promptly entered it in the NPII.
I am accordingly not satisfied that Mr Jovanovski in fact believed his Statement of Affairs had been delivered to the trustee on 29 September 2014 or on 22 June 2015. Nor am I satisfied that he believed, as stated in his affidavit, that his trustee would lodge it with the Official Receiver. On the evidence given at trial, at those times, he believed the trustee and Official Receiver was one and the same person.
Reasonable grounds for a belief that statement had been filed
It is strictly not necessary to consider this issue as I am not satisfied Mr Jovanovski held the requisite belief as to the filing of his Statement of Affairs.
In Wangman, Collier J concluded that a bankrupt had no reasonable basis on which to believe that a Statement of Affairs had been filed. Her Honour so concluded in circumstances where an attempt had been made to file it in 1998 but no further attempt had been made to file a statement in proper form until 2005. Her Honour stated at [43]:
. . . it is clear that several years had passed between the attempted filing of the 1998 Statement of Affairs, and the actual filing of a statement of affairs by the appellant in 2005. During this time the appellant had no basis on which to reasonably believe, and indeed knew, that the document he had submitted for filing in 1998 had not been accepted by the Official Receiver of ITSA. In my respectful view, the section does not contemplate a bankrupt being aware for several years that his or her statement of affairs has not been accepted for filing because it was defective, and then claiming that he or she had, temporarily, a reasonable belief several years before making application to the Court, that the statement of affairs had been filed. In my view, knowledge of this kind does not accord with ‘reasonable belief’ within the meaning of s 33A(2). (Emphasis added)
If I am wrong in the conclusion as to Mr Jovanovski’s subjective state of mind, I would have concluded that he did not hold that belief on reasonable grounds. There may well be circumstances in which a bankrupt has reasonable grounds for such a belief. For the reasons set out above, the facts of the present case deny such a conclusion.
Discretion
Mr Weinberger accepted that if the criteria for the exercise of power were otherwise satisfied it remained a matter of discretion in any case whether an order should be made pursuant to s 33A(2).
In the present case, Mr Jovanovski did not complete, file or lodge a Statement of Affairs with the Official Receiver or the trustee respectively within the prescribed 14 day period. Nor did he contact Mr Tornatore or attend an interview with him to discuss his bankruptcy.
Mr Jovanovski also refused to provide the trustee with details of his residential address. As a result, the Official Receiver was unable to issue a notice under s 77CA so as to take measures to enforce Mr Jovanovski’s obligation to file or lodge a Statement of Affairs. The refusal to provide his address was deliberate. When he finally completed his Statement of Affairs, it contained a residential address in Keilor Downs. There was no reference in the statement to Mr Jovanovski’s residential address in Queensland, despite his evidence that he had lived there in 2014 and still did so. A lack of cooperation is a relevant consideration: Wangmann, [71]; Matteucci, [54].
Mr Jovanovski was reminded repeatedly that he would be eligible for discharge from bankruptcy three years after the filing of his Statement of Affairs with the Official Receiver. He was warned that if the statement was not lodged his bankruptcy may be extended. Offers of assistance were extended to him to complete the Statement of Affairs.
The history of events as outlined in these reasons confirms the manner in which Mr Jovanovski has prevaricated in the discharge of his obligation to complete and file and lodge a Statement of Affairs.
Mr Jovanovski now seeks an order because it suits him to obtain an earlier discharge from bankruptcy arising from the late lodgement of his Statement of Affairs in September 2015. Had he complied with his statutory obligation to file his statement within 14 days of being notified of the making of the sequestration order, the statement would have been filed in June 2014. He would have been automatically discharged from bankruptcy by June 2017. There has been no credible or adequate explanation for his delay of some three years in discharging that obligation. The failure to do so has impeded the trustee. It has hampered the orderly conduct of the administration of the estate.
Had it been necessary to do so I would have refused to make an order in the circumstances as a matter of discretion.
Unsolicited submissions
The day following the hearing, Mr Jovanovski’s solicitors filed a further submission, seeking to advance yet a further alternative claim to relief. On orthodox principles, the Court is entitled to ignore such submissions: cf, eg, Carr v Finance Corporation of Australia Ltd [No 1] (1981) 147 CLR 246 at 258 (Mason J); Eastman v Director of Public Prosecutions (ACT) (2003) 214 CLR 318, [29]-[30] (McHugh J); Re Chief Commissioner of Police (Vic) (2005) 214 ALR 422, [20]-[22], (Gleeson CJ, McHugh, Gummow, Hayden and Heydon JJ), [120] (Kirby J); Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Limited (2010) 241 CLR 357, [111] (Heydon, Crennan and Bell JJ); Commonwealth Bank of Australia v Doggett [2017] FCA 1176, [35] (O’Callaghan J).
The filing of those submissions appears to have served as a catalyst for the trustee’s solicitors to file an answering submission. The response of Mr Jovanovski’s solicitor is particularly notable. Despite having filed a further submission without leave, upon receiving the trustee’s post hearing submission, Mr Weinberger immediately took objection to the trustee having done so. The adoption of that stance by Mr Jovanovski’s solicitor serves to underscore the importance of these principles.
The problem presented by unsolicited submissions was articulated succinctly in Eastman, [29]-[30] where McHugh J stated:
Once the hearing has concluded, the workload of the Court makes it impossible for the Court to give leave to file further submissions – with all the attendant delay in the Court's business by a fresh round of submissions. Efficiency requires that the despatch of the Court's business not be delayed by further submissions reflecting the afterthoughts of a party . . .
I do not consider the further submissions of any party referred to above.
Conclusion
The application must be dismissed. I will allow the parties a short period to consider any application for costs.
I certify that the preceding two hundred and twenty-two (222) paragraphs are a true copy of the reasons for judgment of Judge A Kelly
Date: 18 May 2018
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