Julie McEwan v Daniel Burke

Case [2023] QSC 114

SUPREME COURT OF QUEENSLAND

CITATION:

Julie McEwan v Daniel Burke & Others [2023] QSC 114

PARTIES:

JULIE MCEWAN

(applicant)

v
DANIEL BURKE

(first respondent)

ANDREW HEERS
(second respondent)

AFSA – OFFICIAL TRUSTEE
(third respondent)

FILE NO/S:

3408/23

DIVISION:

Trial Division

PROCEEDING:

Originating Application

ORIGINATING COURT:

Supreme Court

DELIVERED ON:

23 May 2023

DELIVERED AT:

Brisbane

HEARING DATE:

8 May 2023; Further written submissions received by the first and third respondents on 10 May 2023; and by the applicant on 11 May 2023.

JUDGE:

Muir J

ORDER:

Subject to hearing further from the parties about any necessary leave to amend the name of the third respondent and about the issue of costs, it is declared and ordered that:

1.   The Supreme Court of Queensland does not have jurisdiction to hear and determine the originating application filed on 17 March 2023.

2. The originating application filed 17 March 2023 is transferred to the Federal Court of Australia pursuant to s 6(1) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth).

3.   The applications for disclosure filed by the applicant in this proceeding are dismissed.

CATCHWORDS:

PROCEDURE – COURTS AND JUDGES GENERALLY – whether matters claimed by the bankrupt fall within the exclusive jurisdiction of the Federal Court and the Federal Circuit Court

BANKRUPTCY – SUMMARY DISMISSAL – whether a claim by the bankrupt that a discharge objection filed by the trustee is to be declared invalid is within the exclusive jurisdiction of the federal court – whether a claim by the bankrupt that the extension of five years to her bankruptcy term as authorised by the trustee be reversed is within the exclusive jurisdiction of the federal court – whether a claim for compensatory, aggravated and exemplary damages against the bankrupt’s current and former relevant trustee arising from the discharge objection, the extension of the bankruptcy term and the trustees overall conduct is within the exclusive jurisdiction of the federal court

TRANSFER OF PROCEEDINGS UNDER CROSS-VESTING LEGISLATION – SPECIAL FEDERAL MATTERS – whether the Jurisdiction of Courts (Cross-vesting) Act 1987 gives the Supreme Court jurisdiction to hear the applicant’s claim – whether the claim is a special federal matter – whether a special federal court matter must be transferred to the Federal Court of Australia

Cordes v Dr Peter Ironside Pty Ltd [2009] 2 Qd R 235
Fardon v Attorney-General (Qld) (2004) 210 ALR 50

Jakimowicz v Jacks [2016] VSCA 42

Montgomery v Porter [2021] NSWSC 1378
Scott v Bagshaw [2000] 99 FCR 573

McGoldrick v Official Trustee in Bankruptcy (1993) 47 FCR 547

Meriton Apartments & Anor v Industrial Court of New South Wales & Anor (2008) 171 FCR 380
Re Ansett; Ex parte Ansett v Pattison (1995) 56 FCR 526
Truthful Endeavour Pty Ltd v Condon (2015) 233 FCR 174
Turner v Gorkowski (2014) 285 FLR 66
Wright and Others v Nixon [2015] QSC 357

Bankruptcy Act 1966 (Cth)
Constitution of Queensland 2001
Judiciary Act 1903 (Cth)
Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth)
Uniform Civil Procedure Rules 1999 (Qld)

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Details
AGLC
Julie McEwan v Daniel Burke [2023] QSC 114
Case
[2023] QSC 114
Decision Date

CaseChat Overview and Summary

In the case of Julie McEwan v Daniel Burke, the primary issue before the Supreme Court of Queensland was the determination of whether the matters claimed by Ms McEwan fell within the exclusive jurisdiction of the Federal Court and the Federal Circuit Court. The court was required to decide if claims related to the invalidity of a discharge objection, the extension of the bankruptcy term, and the pursuit of damages against the trustees were matters that should be exclusively handled by the federal courts. This decision was crucial for understanding the jurisdictional boundaries between state and federal courts in bankruptcy-related disputes.

The legal issues before the court were complex and centered on the interpretation of the Jurisdiction of Courts (Cross-vesting) Act 1987 and its application to bankruptcy matters. Specifically, the court needed to determine whether the claims raised by Ms McEwan constituted "special federal matters" that must be transferred to the Federal Court. The court considered whether the Cross-vesting Act provided the Supreme Court with the necessary jurisdiction to hear Ms McEwan’s claims or if the claims should be deemed to fall under the exclusive jurisdiction of the federal courts.

In reaching its decision, the court found that the Cross-vesting Act did indeed apply to the proceedings, and the claims presented by Ms McEwan were special federal matters. Consequently, the court was mandated to transfer the proceedings to the Federal Court of Australia. The reasoning behind this decision included the applicability of the Cross-vesting Act, the nature of the claims as special federal matters, and the absence of special reasons justifying the Supreme Court's retention of the case. The court also highlighted that it was more appropriate for the Federal Court to determine the matter.

The final orders of the court declared that the Supreme Court of Queensland did not have jurisdiction over the originating application filed by Ms McEwan on 17 March 2023. The application was transferred to the Federal Court of Australia pursuant to section 6(1) of the Jurisdiction of Courts (Cross-vesting) Act 1987. Additionally, the applications for disclosure filed by Ms McEwan in this proceeding were dismissed. The court directed the legal representatives of the respondents to prepare and email a draft order to Ms McEwan and the court by a specified deadline, subject to any further hearings on the issue of costs and the amendment of the respondent's name.

Orders

Orders of the court

Subject to hearing further from the parties about any necessary leave to amend the name of the third respondent and about the issue of costs, it is declared and ordered that:

1. The Supreme Court of Queensland does not have jurisdiction to hear and determine the originating application filed on 17 March 2023.

2. The originating application filed 17 March 2023 is transferred to the Federal Court of Australia pursuant to s 6(1) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth).

3. The applications for disclosure filed by the applicant in this proceeding are dismissed.

Background

Background to the litigation

The answers to these questions are relevantly informed by an understanding of the relevant background and the nature of the claims (and relief) sought by Ms McEwan in this jurisdiction.[16] [16]As elicited from Ms McEwan’s supporting affidavit material and from her written and oral submissions.Relevant Background Ms McEwan was made a bankrupt on 26 November 2019 following a sequestration order being made in the Federal Court at Brisbane at the request of a petitioning creditor, Mr Guiseppe Pulitano.[17] The sequestration order was underpinned by a judgment obtained by Mr Pulitano against Ms McEwan in the Brisbane Supreme Court on 1 November 2018, following a dispute over the settlement of a property.[18] [17]The full name of the petitioning creditor being Giuseppe Pulitano as trustee for 4-8 Welwyn Crescent Trust. [18]Although, I note Ms McEwan identified the root cause of her bankruptcy to stem from a false complaint made to the police about her by the Brisbane Angels. At the time the sequestration order was made, Mr Heers and Mr Mark Pearce from the insolvency firm “Pearce & Heers” were appointed trustees of the bankrupt estate.[19] [19]Mr Heers had the day-to-day management of the administration of the bankrupt estate assisted by twostaff members from the firm “Pearce & Heers”. In August 2021 Ms McEwan was told by Mr Heers that she was required to pay income contributions of $99,555.58. She repeatedly told Mr Heers that she had no money to payout the bankruptcy and that she considered his request to pay income contributions misconceived and without any evidentiary basis. She also wrote and spoke to Mr Heers on numerous occasions including in August 2021, when she accused him of having fabricated and made up the income assessment. During this period Ms McEwan also raised issues of conflict alleging that Mr Pearce and Mr Heers had previously acted for the Brisbane Angels and for Mr Pulitano. Her frustration and lament about what happened is best articulated in her affidavit as follows:“ I was set up and framed for fraud, what made matters worse, Pearce and Heers were engaged to control my life and the estate for the duration of the three year bankruptcy.” In the usual course, the applicant was to be discharged from her bankruptcy on 5 May 2023 (being three years after she lodged her statement of affairs on 4 May 2020).[20] But on 24 January 2022, Mr Heers lodged notices of objection to discharge, seeking to extend Ms McEwan’s bankruptcy on the basis that Ms McEwan had allegedly failed to pay the income contributions; failed to disclose particulars of income or expected income; and failed to comply with a written request for such information. [20]Under s.149 (2) (c) of the Bankruptcy Act 1966. Under the notices of objection, Ms McEwan was entitled to dispute the grounds of objection by requesting the Inspector-General to review Mr Heers decision to lodge objections within 60 days. Ms McEwan did not do this. But instead, on 20 December 2022 (some 11 months after receiving the notices of objection), she submitted an application for review of objection with the AFSA. She was subsequently informed by that authority that this application was out of time.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The final question for my determination is whether the proceeding should be transferred to the Federal Court. I am satisfied that the answer is plainly yes for the following reasons:(a)First, for the reasons discussed in paragraph 9 above I am satisfied that the Cross-vesting Act is properly invoked and applicable and it is unnecessary for a formal order for transfer by either party.(b)Secondly, for the reasons discussed at paragraphs 26 to 36 above, I am satisfied that the proceeding is one within the jurisdiction of the Federal Court.(c)Thirdly, having found that the proceeding is a special federal matter and there are no special reasons justifying this court determining it, the mandatory provisions of s6(1) of the Cross-vesting Act provide that I “must” transfer the proceeding.(d)Fourthly, (and regardless): this court has the power to order the transfer of its own volition under s 5 (1) of the Cross-vesting Act. That is a power I would have otherwise exercised if necessary because for the reasons discussed at 35 and 51 above it is more appropriate that the proceeding be determined by the Federal Court than this court. Proposed Orders and declarations I direct that by 4.00pm Tuesday 23 May 2023, the first and second respondent’s legal representatives prepare and email Ms McEwan and the court (by emailing my associate) a draft order consistent with my findings that: (a)There is a declaration that the Supreme Court of Queensland does not have jurisdiction to determine the originating application filed 17 March 2023;(b)The originating application filed 17 March 2023 is transferred to the Federal Court pursuant to s 6(1) of the Jurisdiction of Court (Cross-vesting ) Act 1987 (Cth); and(c)The applications for disclosure filed in this proceeding are dismissed.[43][43]It is unnecessary for these applications to be transferred as the Federal Court has its own disclosure regime. I will hear the parties shortly about costs and any necessary leave to amend the name of the third respondent. Any orders I then make are to be included in the draft order I have directed in the previous paragraphs. I will then initial that order which will be placed with the file.