La Roche v Cormack

[1991] FCA 760

JUDGMENT No. . ....... / .......,...... ? b C

IN THE FEDERAL COURT OF AUSTRALIA	)
1
NEW SOUTH WALES DISTRICT REGISTRY j	NO. NP 2765 of 1991

1         NP 2766 of 1991

GENERAL DIVISION

BETWEEN:  ROSEMARY CLARICE ROCHE

Debtor

ESANDA FINANCE CORPORATION

LIMITED

Creditor

0 4 DEC 1991	BETWEEN :	ROBERT ROCHE
FEDERAL COURT OF

AUSTRALIA	Debtor
PRINCIPAL REGISTRY

AND :  ESANDA FINANCE CORPORATION
LIMITED

Creditor

JUDGE MAKING ORDER:	LOCKHART J.
WHERE ORDER MADE:	SYDNEY
DATE ORDER MADE:	21 NOVEMBER 1991

MINUTE OF ORDER

THE COURT ORDERS THAT:

1.    With respect to debtors' petitions 4395 and 4396 of 1991, the Court directs the Registrar to accept those petitions.

2.    With respect to creditors' petitions 2765 and 2766 of 1991 the Court orders that they be adjourned to 3 December 1991 at 10 a.m.

NOTE:	Settlement and entry of orders is dealt with in Order
36 of the Federal Court Rules.

3.   The Court directs Esanda Finance Corporation Limited to send by elther facsimile transmission or ordinary prepaid post a notlce informing the recipient of the adjourned date of the creditors' petitions; the said notice to be sent to the persons described as creditors in the statement of affairs of the debtors by 4 pm, 22 November 1991.

1. Costs reserved.

IN THE FEDERAL COURT OF AUSTRALIA	)
NEW SOUTH WALES DISTRICT REGISTRY	j NO. NP 2765 of 1991
) NP 2766 of 1991
GENERAL DIVISION

BETWEEN:  ROSEMARY CLARICE ROCHE

Debtor

AND :  ESANDA FINANCE CORPORATION
LIMITED

Creditor

BETWEEN :  ROBERT ROCHE

Debtor

AND:  ESANDA FINANCE CORPORATION
LIMITED

Creditor

21 NOVEMBER 1991

REASONS FOR JUDGMENT

LOCKHART J.

Before the Court thls mornlng are two creditors' petitions,
the creditor being Esanda Finance Corporation Ljmited ( "Esanda")

and the debtors being husband and wife, Rosemary Clarice Roche

and Robert Roche. There are also before the Court pursuant to	section 55(3A) of the Bankruptcy Act 1966 ("the Act") references
from the Registrar to the Court for a direction to accept or reject two debtors' petitions which were presented by each of the debtors yesterday, 20 November 1991.
The act of bankruptcy upon whlch the creditors' petitions are founded is that the debtor in each case transfered an interest in property which would be void as against the trustee ~n bankruptcy pursuant to section 40(l)(b) of the Act. The resolution of that question is intimately bound up with substantially the same question which arises in proceedings presently before the Supreme Court of New South Wales in its Commercial Division where, amongst other things, Esanda attacks the transfers of property to whlch I have referred and seeks to have them declared void pursuant to section 37A of the Conveyancing Act 19 19 (New South Wales) .
On 8 November last Mr Justice Rogers of the Supreme Court, in dealing with matters that came before him pursuant to those Supreme Court proceedings and being Informed of the pendency of the creditors petitions i.n bankruptcy which are presently before this Court, said that, in h ~ s view, it was desirable that some steps be taken to bring some measure of order into what he described as the chaos and that he thought it undesirable that there should continue to be two sets of proceedings, one in the Federal Court and one ln the Supreme Court involving the same
underlying facts. His Honour said that he would be happy to transfer the proceedings before the Supreme Court to this Court
or alternatively to have this Court transfer the proceedings before it to the Supreme Court and thought the choice should be that of this Court In a11 the circumstances.
I agree with hls Honour that it is undesirable that there should contlnue to be two sets of proceedings in this Court and the Supreme Court involving the same constitutive facts and I also agree that the relevant matters may be transfered by one Court to the other; and like his Honour it does not concern me which of the two Courts should be the ultimate repository of the matters.
Discussion has taken place thls morning between Bench and Bar and, in my view, the appropriate course for this Court to take is to give the requisite direction to the Registrar pursuant to section 55(3A) of the Act to accept the two debtors' petitions. The matter of particular relevance in relation to that direction is of course the question of whether the differing perlods of relation back may have some significance in this case, because the creditors' petitions were presented in August of this year and the debtors' petitions yesterday, a difference of some three months.
Nothing has been said to me and I have seen nothing in the material before me which would suggest that anything in this case turns on the differing periods of relation back. However, if it
Registrar accepts the debtors' petitions, that material has not should transpire in due course, on the assumption that the
been properly and fully disclosed to the Registrar by the debtors, it is open for the bankruptcies to be annulled. Accordingly, I propose to give the directions to the Registrar to accept the debtors' petitions.
It will then follow that the trustee in bankruptcy will have to consider what course, if any, he will take with respect to the section 37A proceedings in the Supreme Court and any action that he may see flt to institute in this Court by way of a proceeding based on S. 121 of the Act, any such proceedings involving in substance the same factual matrix as do the S. 37A proceedings. The trustee may wish also to examine the debtors or other persons under the Act wlth respect to those matters.
The giving of a direction to the Registrar to accept the petit~ons necessarily involves a lapse of time, albeit short, before the Registrar accepts the petitions and it is undesirable that until that has run its course the creditors' petitions be dismissed. I think they should remain on foot for a short time so that the debtors can then proceed into bankruptcy through the medium of their own petitions and the Court can then be asked by the credltor to dismlss the creditors' petitions.
Whether thls Court should transfer any proceedings before it or whether the Supreme Court should itself transfer the
sectlon 37A proceedings to thls Court are matters which I will
not decide today. It will depend I think on the ultimate fate of the creditors' petitions and the view taken by the trustee in
bankruptcy. The matter may then be, so far as this Court is concerned, properly assessed. If, for example, the trustee does not propose to take any steps himself under S. 121, so that the only relevant proceedings on foot are the S. 37A proceedings in the Supreme Court, it may be that the appropriate Court to then deal with that matter is the Court which is presently seized with it, namely the Supreme Court, but I prefer to express no further view on the matter at this stage.

The Court makes the following orders:

1. With respect to debtors' petit-ions 4 3 9 5 and 4396 of 1991,

the Court directs the Registrar to accept those petitions.

2 .    Wlth respect to credltors' petitions 2 7 6 5 and 2 7 6 6 of 1991 ,

they are adjourned to Tuesday, 3 December next at 10.00 am.

3 . I dlrect Esanda Finance Corporation Limited to send by either facsimile transmission or ordinary prepald post a notice informing the rec~pient of the adjourned date of the creditors' petitions; the said notlce to be sent to the persons described as credltors in the statements of affairs of the debtors by 4 .OO

pm tomorrow, 2 2 November 1 9 9 1 .

I reserve all questions of costs.

preceding four ( 4 ) pages are a	I certify that this and the
true copy of the reasons for judgment herein of the Honourable Mr. Justice Lockhart.
Assoclate /i$?+%
Dated:  2 1 November 1 9 9 1

Counsel for the Creditor G.C. Lindsay

Solicitors for the Credltor	:	Dunhill Madden Butler
Counsel for the Debtor	S.A. Gregory
Solicltors for the Debtor	Henry Davis York
Date of Hearing	21 November 1991
Date of Judgment	21 November 1991