Juratowitch (as trustee for the Bankrupt Estate of Saad Al Bagdady (Also Known as Sami Sabri)) v Baghdady (Also Known as Sami Sabri) (A Bankrupt)
[2016] FCCA 2912
•11 November 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| JURATOWITCH (AS TRUSTEE FOR THE BANKRUPT ESTATE OF SAAD AL BAGDADY (ALSO KNOWN AS SAMI SABRI)) v BAGHDADY (ALSO KNOWN AS SAMI SABRI) (A BANKRUPT) | [2016] FCCA 2912 |
| Catchwords: BANKRUPTCY – Bankruptcy Act – application by Trustee for orders for vacant possession against bankrupt’s residential property – order for vacant possession together with ancillary orders made. |
| Legislation: Bankruptcy Act 1966, ss.30, 58, 77 |
| Cases cited: Coshott v Prentice [2014] FCAFC 88 in Vince (Trustee) re Sopikiotis (Bankrupt) v Sopikiotis (No. 2) [2012] FCA 1298 |
| Applicant: | DANIEL PETER JURATOWITCH (AS TRUSTEE FOR THE BANKRUPT ESTATE OF SAAD AL BAGDADY (ALSO KNOWN AS SAMI SABRI)) |
| Respondent: | SAAD AL BAGHDADY (ALSO KNOWN AS SAMI SABRI) (A BANKRUPT) |
| File Number: | SYG 1958 of 2016 |
| Judgment of: | Judge Dowdy |
| Hearing date: | 4 November 2016 |
| Date of Last Submission: | 10 November 2016 |
| Delivered at: | Sydney |
| Delivered on: | 11 November 2016 |
REPRESENTATION
| Counsel for the Applicant: | Ms M Pavey. |
| Solicitors for the Applicant: | Smith Leonard Fahey Lawyers. |
| No appearance for the Respondent. |
THE COURT ORDERS AS FOLLOWS
Order that the respondent Saad Al Baghdady (also known as Sami Sabri) do yield and deliver up to the applicant vacant possession of the land together with the improvements erected thereupon comprised in Folio Identifiers 15/20/1100 and 16/20/1100 and known as 28 Austral Street, Mt Druitt in the State of New South Wales on or before 9 December 2016.
Order that the respondent do yield and deliver up to the applicant the keys for all buildings and improvements on the Property on or before 9 December 2016.
Order that the respondent remove from the Property on or before 9 December 2016 all motor vehicles, rubbish, and any other chattels or personal property which have not vested in the applicant as the respondent’s trustee in bankruptcy under s.58(1) of the Bankruptcy Act 1966 (Cth).
Order that a writ of possession of the Property issue forthwith in favour of the applicant but direct that such writ lie in the Registry of the Court until the filing by the applicant not before 9 December 2016 of an affidavit to the satisfaction of a Registrar of the Court:
(a)stating that the respondent has not given vacant possession of the Property as ordered by Order 1 above; and
(b)complies with the requirements of Uniform Civil Procedure Rules 2005 (NSW) r.39.3.2(a) and (b).
Order that the applicant’s costs of this application be paid out of the bankrupt estate of the respondent.
Order that the applicant serve a copy of this Order on the respondent and also attach a copy of the order to the front door of the Property by 5pm on 18 November 2016.
Order that service on the respondent may be effected by ordinary post directed to the address of the Property by 22 November 2016 if personal service upon the respondent is not able to be effected.
Reserve liberty to the applicant to apply for any further substantive relief as sought in his application filed 25 July 2016 on 7 days’ notice, including notice to the Australian and New Zealand Banking Group Ltd.
Otherwise reserve liberty to any party to apply generally on 3 days’ notice.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 1958 of 2016
| DANIEL PETER JURATOWITCH (AS TRUSTEE FOR THE BANKRUPT ESTATE OF SAAD AL BAGDADY (ALSO KNOWN AS SAMI SABRI)) |
Applicant
And
| SAAD AL BAGHDADY (ALSO KNOWN AS SAMI SABRI) (A BANKRUPT) |
Respondent
REASONS FOR JUDGMENT
The applicant is the trustee of the bankrupt estate of the respondent, Mr Saad Al Baghdady, also known as Mr Sami Sabri.
The applicant was appointed trustee of the bankrupt estate on 23 October 2014 by a Registrar of this Court in its bankruptcy jurisdiction.
The relevant history and circumstances of the bankruptcy are set out in the applicant’s affidavit sworn 21 June 2016.
In short, the applicant became aware shortly after 12 December 2014 that the bankrupt was the sole registered proprietor of the residential property comprised in folio identifiers 15 and 16/20/1100 and known as 28 Austral Street, Mt Druitt, in the State of New South Wales (Property).
The Property is subject to a first registered mortgage in favour of the Australian and New Zealand Banking Group Ltd (ANZ Bank) dated 21 October 2014.
Pursuant to s.58(1) of the Bankruptcy Act 1966 Cth (the Act) all of the bankrupt’s interest in the Property had vested in the applicant upon the making of the sequestration order on 23 October 2014.
On 16 December 2014 the applicant registered caveat no. AJ118377 over the Property to protect his interest as trustee.
A Valuation of the Property dated 30 March 2016 values it as being worth $580,000 and as at 3 June 2016 the ANZ Bank mortgage secured $446,289.40, leaving an available equity of approximately $133,710.60.
From 19 December 2014 to on or about 6 June 2016 the applicant has been undertaking a process of seeking to persuade the bankrupt to either pay out to him as trustee an amount equating to the equity in the Property, or alternatively arrange for a third party to purchase the Property, rather than seeking to involve himself in litigation leading to realization and sale of the Property.
However, the bankrupt has ultimately failed to evince any real interest in negotiating and dealing with the trustee in that regard.
In these circumstances the applicant, by his application filed in this Court on 25 July 2016, seeks orders that the bankrupt vacate the Property and in default thereof that a writ of possession should issue and thereafter the applicant have the sole conduct of the sale of the Property.
Orders are also sought for the removal of any personal property and chattels presently upon the Property, which have not vested in the applicant as trustee.
There is a body of authority which satisfies me that the Court has both the jurisdiction and the power to make the orders sought by the applicant: see ss.30 and 77(1)(e) and (g) of the Act.
That body of law was recently referred to by the Full Court of the Federal Court of Australia comprised of Siopis, Katzmann & Perry JJ in Coshott v Prentice [2014] FCAFC 88 where at paragraphs 91 to 94 the following was said:
91.Section 30(1) of the Bankruptcy Act provides that:
(1) The Court:
(a) has full power to decide all questions, whether of law or of fact, in any case of bankruptcy or any matter under Part IX, X or XI coming within the cognizance of the Court; and
(b) may make such orders (including declaratory orders and orders granting injunctions or other equitable remedies) as the Court considers necessary for the purposes of carrying out or giving effect to this Act in any such case or matter.
92.As is apparent, the power to make orders under s 30(1)(b) must be exercised for the purposes of carrying out or giving effect to the Act in the particular case. Those purposes, in common with any modern system of bankruptcy law, are to provide for the appropriation and equitable distribution of the assets of the insolvent debtor, and upon this, the debtor’s release from future liability in respect of his or her existing debts: Storey v Lane [1981] HCA 47; (1981) 147 CLR 549 (Storey) at 556 (Gibbs CJ).
93.In line with these objects and the breadth of the language in s 30(1), it has been held that the provision should not be construed narrowly. As Neaves J observed in Re Bilen; Ex parte Sistrom (unreported, Federal Court of Australia, Neaves J, 11 April 1985) in a passage quoted with approval by the Full Court in Talacko v Talacko [2010] FCAFC 54; (2010) 183 FCR 311 (Talacko) at 321, s 30(1):
is a facultative provision giving the court full power, within the limits of its jurisdiction to be found elsewhere, to make such orders as it considers should be made in order to carry out and give effect to the Act. The words used are not words of limitation but of extension.
94.Thus, the section has been held to provide sufficient power to make orders against a bankrupt for the vacation of property, issuing a warrant of possession and for the sale of a property in circumstances where the bankrupt is not complying with his or her obligations under the Act: see, eg, Vince (Trustee), in the matter of Sopikiotis (Bankrupt) v Sopikiotis (No 2) [2012] FCA 1298 at [4] (Bromberg J); Pattison v McKinnon [2008] FCA 1624 at [2] (Jessup J); Official Receiver v Fall (2008) 5 ABC(NS) 772 at [10]-[12] (Lucev FM (as his Honour then was)). It also expressly extends to ancillary relief such as injunctions and other equitable remedies to prevent the scheme of the Act from being defeated. Such ancillary orders are, as the Full Court observed in Talacko at 321 [17], “neither novel or unusual”: see also Storey at 557 (Gibbs CJ).
I am satisfied and find that the bankrupt is the registered proprietor of the Property and has been served with the application to this Court.
The registered proprietor of the Property is named as Sami Sabri, and that name also appears as the name of the mortgagor on the ANZ Bank mortgage. However, the bankrupt submitted his Statement of Affairs on 21 March 2016, in which he gave his full name as Sami Sabri, but in the last 10 years stated that he has used the name of Saad Al Baghdady.
Further, in his Statement of Affairs, the bankrupt gave his residential address as the address of the Property, being 28 Austral Street, Mt Druitt.
The affidavit evidence led in support of the application to this Court proves that the bankrupt was served on 23 August 2016 with a copy of the application filed in this Court on 25 June 2016 together with the affidavit of the Applicant in support and that at the time of service the bankrupt acknowledged that he was “Saad Al Baghdady, also known as Sami Sabri”.
Thereafter the bankrupt was given notice of the application having been listed before me on 30 September 2016 when he appeared in person and I set the hearing of the application down for 4 November 2016 and I made directions for him to file and serve any affidavit or written submissions on which he intended to rely by 28 October 2016. In the result the bankrupt did not appear before the Court at the hearing of the application on 4 November 2016.
I note that at the directions hearing on 30 September 2016 I was informed on behalf of the bankrupt that he was not living in the Property, which he had emptied.
I am further satisfied that the fact that the applicant has not yet become registered proprietor, by transmission, of the Property does not preclude the making of the type of orders sought by the. Similar orders were made in Vince (Trustee) re Sopikiotis (Bankrupt) v Sopikiotis (No. 2) [2012] FCA 1298 by Bromberg J in the Federal Court and in Official Receiver v Fall & Anor [2008] FMCA 489 by Lucev FM, in neither of which case had the trustee become registered proprietor of the property in connection with which the orders were sought.
Accordingly, I will make an order that the respondent give vacant possession of the Property to the applicant together with ancillary orders.
I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for judgment of Judge Dowdy
Date: 11 November 2016
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