Lamb v Sherman

Lamb v Sherman involved a dispute between Ms Lamb and Mr Sherman regarding a bankruptcy notice. The matter came before the court on appeal from the decision to make a sequestration order. The primary legal issues were whether Ms Lamb's application to set aside the bankruptcy notice was "made" to the Court within the meaning of s 41(6A)(b) of the Bankruptcy Act 1966 (Cth) by the electronic lodgment of the application or by its acceptance for filing, and whether the act of bankruptcy occurred within six months before the presentation of the petition. The court had to consider the operation of the relevant Federal Court Rules regarding document lodgment and filing.

The court found that Ms Lamb's application to set aside the bankruptcy notice was made to the Court by its acceptance for filing, not by the electronic lodgment of the application. The court reasoned that the Federal Court (Bankrupcy) Rules require an application to be "made" by filing, and the Federal Court Rules deem an electronically lodged document filed if accepted after 4:30pm on the last day for compliance. The court also determined that the act of bankruptcy occurred within the required timeframe, and therefore, the appeal was dismissed.

As a result of the court's decision, the orders made in respect of the interim application filed on 27 March 2023 were set aside, and Mr Sherman was ordered to pay 75% of Ms Lamb's costs of the interim application. The court allowed the parties to confer and bring in draft orders to give effect to these reasons. If they could not agree, they were to make written submissions limited to one page within seven days of these reasons being published.