Khera v Jones (No.2)
[2007] FMCA 1545
•6 September 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| KHERA v JONES (No.2) | [2007] FMCA 1545 |
| BANKRUPTCY – Application discontinued and dismissed – costs following the event – applicant to pay indemnity costs. |
| Bankruptcy Act 1966 |
| Applicant: | JASWANT KHERA |
| Respondent: | IAN ROBERT DURSTON JONES |
| File number: | SYG 3246 of 2005 |
| Judgment of: | Burchardt FM |
| Hearing dates: | 5 & 6 September 2007 |
| Date of last submission: | 6 September 2007 |
| Delivered at: | Melbourne (and by video link to Sydney) |
| Delivered on: | 6 September 2007 |
REPRESENTATION
| The Applicant: | In person |
| Counsel for the Respondent: | Ms T. Middleton |
| Solicitors for the Respondent: | Macquarie Legal Practice |
ORDERS
The Applicant is to pay the Respondent’s costs, fixed in the amount of $1,320.00.
The application be dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
SYG 3246 of 2005
| JASWANT KHERA |
Applicant
And
| IAN ROBERT DURSTON JONES |
Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
On 24 August 2007, Federal Magistrate McInnis dismissed an application by the Applicant Debtor, Mr Khera, to set aside a Bankruptcy Notice served upon him. The issue was whether there was or was not a counter-claim, set-off or cross-demand equal to or exceeding the amount claimed in the Bankruptcy Notice. The last paragraph of his Honour’s judgment indicates that the application as amended was dismissed and the Applicant Debtor,
Mr Khera, was ordered to pay the Respondent Creditor’s costs.
There has not been a formal application lodged with the Court to extend the time to comply with the Bankruptcy Notice, but the Court has treated Mr Khera’s letter of 27 August 2007 as being sufficient to agitate the matter in a proper way.
When the matter came before me yesterday afternoon, I invited
Mr Khera to indicate the grounds upon which he felt it be appropriate that the extension be granted. He said, amongst other things, that he had overlooked to apply for an extension when the matter was before Federal Magistrate McInnis. He proposed to appeal; if an extension were not granted, then a Petition was likely to be issued. These circumstances gave rise to possible multiple proceedings and costs. He said that unnecessary hardship would be imposed upon him if the extension were not granted. He indicated, however, that he is a legal practitioner who has now retired because of ill health.
Ms Middleton, for the Respondent Creditor, took issue as to whether or not there had been an opportunity to canvass the possibility of any further orders, such as an extension of time, but did tell the Court that there was a Creditor’s Petition issued, returnable on 11 October 2007.
Of my own motion, I raised with Mr Khera the relevant extract from The Standard Work on Bankruptcy Law and Practice by McDonald, Henry and Meek, which indicates, in a footnote, that there is no power in the Court to extend time in circumstances such as these. I referred to the two authorities cited by the learned authors.
Mr Khera was not able to assist me in regard to those matters and, indeed, was not able to point to any source of power in the Bankruptcy Act 1966 (“the Act”) which enabled me to do what he was asking me to do. Ms Middleton, by way of contrast, would have tendered the decision of von Doussa J to which I had referred, except that, of course, tender is not possible by video-link.
Given that Mr Khera is representing himself, and given that, notwithstanding the fact he is legally qualified, he was plainly unfamiliar with the authorities concerned, I adjourned the matter and reserved the Respondent Creditor’s costs on 5 September 2007 so that Mr Khera consider his position.
On 6 September 2007 Mr Khera has sought to discontinue his application because he has been served with the Petition. The only issue therefore that remains for consideration is the question of costs. Ms Middleton has sought indemnity costs fixed in the sum of $1,320.00, which sum, I may say, on one view, depending on the way you approach the Court’s schedules of costs, is very little more, if any, than the schedule sums that might be awarded in circumstances such
as these. It is, in my view, an eminently reasonable amount in light of the amount of work involved in preparing for the application.
Mr Khera says there should be no Order as to costs, and it is fair to paraphrase what he says in that regard as being the conduct of the Respondent Creditor generally in the proceeding. He primarily pointed to matters which were either able to have been agitated before
Federal Magistrate McInnis, and/or were agitated before him. I have not read the transcript and have only read the decision once so I am not
in a position to precisely delineate between the two.
However, it is clear to me that, Mr Khera’s position is one which ignores the fact that costs follow the event. It appears, in large part, to relate to matters that have already been determined by the Court, and which, if not determined by the Court, should have been because they should have been raised when the matter was before Federal Magistrate McInnis.
While it is true that the amount now specified in the Petition is substantially smaller than the amount in issue before Federal Magistrate McInnis, I have no doubt that that is because the Petitioning Creditor, as a matter of caution, has, as it were, specified only that amount that is wholly free from any attack, even if the arguments that had been advanced before Federal Magistrate McInnis had been accepted, which of course they were not.
I think it is entirely reasonable, in these circumstances, that costs should follow the event. Mr Khera ought to have been able to have dealt with this matter on 5 September 2007, so the adjournment was entirely his responsibility.
Furthermore, the authorities, as they stand, plainly were always against him in such a fashion as to make his application all but hopeless.
And, furthermore, even if there was some super-arching capacity on the Court’s part to Order a stay, pending an appeal conducted by
Mr Khera, the facts, as disclosed on 5 and 6 September 2007, go nowhere near as far as would be necessary to grant a stay, even if one was able to be granted.
I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of Burchardt FM
Associate: Brooke Evans
Date: 6 September 2007
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