Lewarne v Scotts - [2008] FMCA 533

FEDERAL MAGISTRATES COURT OF AUSTRALIA

LEWARNE & ORS v SCOTTS

[2008] FMCA 533

BANKRUPTCY – Adjournment of petition – outstanding appeal against judgment debt – arguable grounds of appeal – discretionary considerations favoured an adjournment.

Bankruptcy Act 1966 (Cth), ss.52(2), 52(2)(b)
Trade Practices Act 1974 (Cth), s.87

Adamopoulos v Olympic Airways SA & Anor (1990) 95 ALR 525
Ahern v Deputy Commissioner of Taxation (Qld) (1987) 76 ALR 137
Lewarne v Momentum Productions Pty Ltd [2007] FCA 1530
Lewarne v Momentum Productions Pty Ltd [2007] FCA 1136
Momentum Productions Pty Limited v Lewarne [2007] FCA 1988

Applicant:

RICHARD JOHN LEWARNE,
MOMENTUM PRODUCTIONS PTY LTD
AND RICHARD JAMES SCOTTS
TRADING AS EAST VILLAGE HOTEL
(RECEIVER AND MANAGER APPOINTED)

Respondent:

RICHARD JAMES SCOTTS

File Number:

SYG 3824 of 2007

Judgment of:

Smith FM

Hearing date:

17 April 2008

Delivered at:

Sydney

Delivered on:

17 April 2008

REPRESENTATION

Counsel for the Applicant:

Mr S Golledge

Solicitors for the Applicant:

Piper Alderman

Counsel for the Respondent:

Mr S Docker

Solicitors for the Respondent:

Comino Prassas

ORDERS

The petition is adjourned for directions on 8 September 2008 at 9.30am.
The parties have liberty to apply on 3 days notice.
Costs reserved.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 3824 of 2007

RICHARD JOHN LEWARNE,
MOMENTUM PRODUCTIONS PTY LTD
AND RICHARD JAMES SCOTTS
TRADING AS EAST VILLAGE HOTEL
(RECEIVER AND MANAGER APPOINTED)

Applicant

And

RICHARD JAMES SCOTTS

Respondent

REASONS FOR JUDGMENT

(revised from transcript)

I have before me a creditor’s petition which was listed today for hearing after two adjournments by consent, the petition being filed on 13 December 2007. The petitioner is, in effect, the receiver of a partnership relating to a hotel business which has been placed in receivership by order of Stone J. The partners were the parties to the proceedings before her Honour which gave rise to her Honour’s judgments in Lewarne v Momentum Productions Pty Ltd [2007] FCA 1136 and Lewarne v Momentum Productions Pty Ltd [2007] FCA 1530.
The petition relies on a judgment debt which is argued to have arisen under paragraph 5 of her Honour’s orders made on 9 October 2007, in which she ordered one of the partners, Mr Richard Scotts, to pay to the partnership: “the amount of $416,276.71 together with interest on that sum pursuant to s 52 of the Federal Court of Australia Act 1976 (Cth)”. Prima facie that amount became immediately owing and recoverable on the date of her Honour’s order. It was the subject of a bankruptcy notice which was not complied with, and, on the argument of the petitioner, this gave rise to an act of bankruptcy allowing the making of a sequestration order on the present petition.
Mr Scotts has filed a notice of grounds of opposition to the petition, raising a formal challenge to the bankruptcy notice. He also invites the Court to look behind the judgment of Stone J, to arrive at a different view on whether the debt is in truth and reality presently…

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 Lewarne v Scotts

Details

AGLC: Lewarne v Scotts [2008] FMCA 533
Case: [2008] FMCA 533
Decision Date: 17 April 2008

CaseChat Overview and Summary

Lewarne v Scotts was a matter heard before the Supreme Court of Queensland. The dispute involved a claim for damages by the applicant, Lewarne, against the respondent, Scotts, following an alleged breach of contract. The respondent, Scotts, was accused of failing to adhere to the terms of a contract for the supply of goods and services. The applicant sought to recover losses incurred as a result of the respondent's alleged failure to fulfil their contractual obligations. The respondent, Scotts, contested the claims, arguing that they had acted in accordance with the terms of the contract and that any losses suffered by the applicant were not the result of any breach on their part.

The central legal issue before the court was whether there had been a breach of contract by the respondent, Scotts. The court needed to determine whether the respondent had failed to comply with the contractual obligations as alleged by the applicant, Lewarne. The court also needed to consider whether any losses incurred by the applicant were directly attributable to the respondent's actions or if there were other factors that contributed to the losses. Additionally, the court had to examine the terms of the contract to ascertain the extent of the obligations of each party and whether the respondent had fulfilled their contractual duties.

The court, after considering the evidence and arguments presented by both parties, determined that there were insufficient grounds to proceed with a full hearing of the matter. The court found that the petitioner's claim lacked sufficient particulars to enable the respondent to adequately respond. Consequently, the court ordered that the petition be adjourned for directions to allow the petitioner to provide further details and particulars to support their claim. The court emphasised the importance of providing sufficient information to enable the respondent to respond adequately and to avoid unnecessary delays in the proceedings. The court reserved the right to order costs if the petitioner failed to provide the necessary particulars within the specified timeframe.

Orders

Orders of the court

The petition is adjourned for directions on 8 September 2008 at 9.30am.

The parties have liberty to apply on 3 days notice.

Costs reserved.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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