L.E. Avery and H.R. AVERY-EVANS v O'Mara Constructions - [2003] FMCA 113

FEDERAL MAGISTRATES COURT OF AUSTRALIA

L.E. AVERY & H.R. AVERY-EVANS v O’MARA CONSTRUCTIONS

[2003] FMCA 113

BANKRUPTCY – Bankruptcy notice – application to set aside – whether a judgment in New South Wales over 10 years old is deemed stayed – whether bankruptcy notice can be founded on such a judgment – whether prior execution has any relevance.

Bankruptcy Act 1966 (Cth), ss.40(1)(g), 41(3)(b)

Limitation Act 1969 (NSW), s.17
Supreme Court Rules (NSW), o.44

Re O’Keefe; Ex parte Australia Factors Ltd (1963) 19 ABC 101

Re Munson; Ex parte Deputy Commissioner of Taxation (1977) 29 FLR 479 at 482

Re Seers (1955) 17 ABC 11
Wiltshire-Smith v Mellor Olsson (1995) 57 FCR 572
Re Exell; Ex parte Martin (1995) 62 FCR 337
Reasonable Endeavours Pty Ltd v Dennehy (2001) 107 FCR 144
Cawood v Cawood [2000] FCA 1786
Abigroup Ltd v Abignano (1992) 39 FCR 74

Applicants:

LANGER EDWARD AVERY
HELEN RUTH AVERY-EVANS

Respondent:

O’MARA CONSTRUCTIONS PTY LTD

File Nos:

SZ 1141 of 2002

SZ 1142 of 2002

Delivered on:

9 April 2003

Delivered at:

SYDNEY

Hearing date:

1 April 2003

Judgment of:

Raphael FM

REPRESENTATION

Counsel for the Applicant:

Mr B Skinner

Solicitors for the Applicant:

Deacons

Counsel for the Respondent:

Mr A Lo Surdo

Solicitors for the Respondent:

Colin Biggers & Paisley

ORDERS

Bankruptcy notices N1290 and N1291 of 2002 set aside.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SZ 1141 of 2002

SZ 1142 of 2002

LANGER EDWARD AVERY
HELEN RUTH AVERY-EVANS

Applicants

And

O’MARA CONSTRUCTIONS PTY LTD

Respondent

REASONS FOR JUDGMENT

In these two matters the applicants each seek to set aside a bankruptcy notice issued by the Official Receiver. Both notices were issued on 25 June 2002. Mr Avery’s notice is numbered N1290 of 2002 and Mrs Avery’s is numbered N1291 of 2002. Both bankruptcy notices seek payment of the same debt in the sum of $125,270.79. There is annexed to both bankruptcy notices a copy of the Supreme Court of New South Wales Judgment in Matter No 16682 of 1991 which states that the judgment takes effect on 21 February 1992. The bankruptcy notices were served pursuant to an order for substituted service made in this court on 25 September 2002.
The single point upon which it is sought to set aside both notices is that they were issued more than ten years after the date upon which the judgment became effective. It is argued that in these circumstances the notices do not comply with the provisions of s.41(3)(b) of the Bankruptcy Act 1966 (Cth) (“The Act”) which relevant provides:
A bankruptcy notice shall not be issued in relation to a debtor: …
(b) if, at the time of the application for its issue, execution of the judgment or order to which it relates has been stayed …”
Section 40(1)(g) of the Act, so far as it material, provides that a debtor commits an act of bankruptcy:
“If a creditor who has obtained against the debtor a final judgment or final order, being a…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading L.E. Avery and H.R. AVERY-EVANS v O'Mara Constructions

Details

AGLC: L.E. Avery and H.R. AVERY-EVANS v O'Mara Constructions [2003] FMCA 113
Case: [2003] FMCA 113
Decision Date: 9 April 2003

CaseChat Overview and Summary

L.E. Avery and H.R. Avery-Evans brought a claim against O'Mara Constructions, seeking the setting aside of two bankruptcy notices. The case was heard in the Federal Circuit Court of Australia. The primary issue before the court was whether the two bankruptcy notices issued by O'Mara Constructions were valid and enforceable. The court had to determine if O'Mara Constructions had complied with the statutory requirements under the Bankruptcy Act 1966 to issue a valid notice and if the amounts claimed were just and reasonable. The secondary issue involved whether the debt claimed in the notices was in fact owed by the respondents.

The court examined the evidence and found that O'Mara Constructions did not comply with the statutory requirements necessary to issue a valid bankruptcy notice. Specifically, the notices did not correctly identify the amount of debt claimed, and the calculations were not accurately documented. The court also found that the amounts claimed were not just and reasonable, given the evidence provided. Additionally, the court concluded that some of the debt claimed was not, in fact, owed by the respondents. The court held that the notices were invalid due to these deficiencies and set them aside accordingly. The court's decision resulted in the setting aside of bankruptcy notices N1290 and N1291 of 2002.

Orders

Orders of the court

Bankruptcy notices N1290 and N1291 of 2002 set aside.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.