MacDonald v Raupach - [2011] NSWCA 320

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: MacDonald v Raupach [2011] NSWCA 320
Hearing dates: 30 September 2011
Decision date: 30 September 2011
Before: Bathurst CJ at [26] [31] Young JA at [1]; Sackville AJA at [27]
Decision:
Appeal is dismissed with costs.
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords: BANKRUPTCY- provable debts- bankrupt entered into a deed for payment of $100,000 to settle a District Court action in which he was a third party- deed entered into for relationship's sake not because of pre-existing liability- only paid $20,000- primary judge ordered appellant to pay $80,000 plus interest and costs- money due under deed not a provable debt because not a contingent debt existing at the time of the bankruptcy- bankruptcy later annulled because of composition- effect of annulment of bankruptcy is as if bankruptcy never occurred in the first place- no leave to proceed against the bankrupt in the District Court had been obtained- this did not vitiate- in any event annulment made the defect otiose- even if a provable debt, respondents' rights revived after annulment- deed enforceable- appeal dismissed.
Legislation Cited: Bankruptcy Act 1966 (Cth) ss 82, 149
Contracts Review Act 1980
Cases Cited: Foots v Southern Cross Mine Management Pty Limited [2007] HCA 56; 234 CLR 52
Lewis v Combell Constructions Pty Ltd (1989) 18 NSWLR 528
Re Coyle (1993) 42 FCR 72
Re Giuca; Ex parte The Bankrupts (1986) 70 ALR 219
Re Spratt; Ex parte Wilde (1986) 10 FCR 544
Reynolds v Reynolds [1977] 2 NSWLR 295
Union Club v Battenberg [2006] NSWCA 72; 66 NSWLR 1
Wilde v Spratt (1986) 13 FCR 284
Category: Principal judgment
Parties: Neil MacDonald (Appellant)
Douglas Raupach (First Respondent)
Enrico Di Lario (Second Respondent)
Sandra Simone Di Lario (Third Respondent)
Representation: Counsel:
Appellant in person
V Bedrossian (First Respondent)
R M Higgins (Second and Third Respondents)
Solicitors:
Appellant self represented
Accentro Legal (First Respondent)
Hunter Lawyers (Second and Third Respondents)

File Number(s): CA 2007/261840
Decision under appeal

Citation:

Raupach v MacDonald [2010] NSWSC 1326

Date of Decision:

2010-11-24 00:00:00

Before:

Price J

File Number(s):

SC 2007/261840

Judgment

YOUNG JA: (Giving the first judgment at the invitation of the Chief Justice). This is an appeal against a decision giving judgment against the appellant for debt. The basal background facts appear to be that the appellant was associated with a company, Finance & Mortgage Corporation Pty Limited (Finance & Mortgage). By October 1994, the first respondent had lent monies secured by a mortgage to a number of clients of that company. One of those borrowings was by the second and third respondents. I…

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 MacDonald v Raupach

Details

AGLC: MacDonald v Raupach [2011] NSWCA 320
Case: [2011] NSWCA 320
Decision Date: 30 September 2011

CaseChat Overview and Summary

In *MacDonald v Raupach*, the appellant, Mr. MacDonald, appealed a decision of the primary judge who had ordered him to pay $80,000 plus interest and costs. This sum represented the outstanding amount under a deed entered into between Mr. MacDonald and the respondents, Mr. and Mrs. Raupach, to settle a District Court action. The deed was executed for the sake of their relationship, not due to any pre-existing liability on Mr. MacDonald's part.

The central legal issues before the Court of Appeal were whether the money due under the deed constituted a provable debt in Mr. MacDonald's bankruptcy, and the effect of the subsequent annulment of his bankruptcy on the respondents' rights. Specifically, the court had to consider if the debt was contingent at the time of bankruptcy and, if so, whether the annulment rendered the primary judge's order invalid or revived the respondents' rights under the deed.

The Court of Appeal, comprising Bathurst CJ, Young JA, and Sackville AJA, reasoned that the money due under the deed was not a provable debt because it was not a contingent debt existing at the time of the bankruptcy. Furthermore, the court held that the annulment of Mr. MacDonald's bankruptcy, which occurred due to a composition, had the effect of rendering the bankruptcy as if it had never occurred. While no leave to proceed against the bankrupt had been obtained in the District Court, the annulment made this defect otiose. Even if the debt had been provable, the annulment would have revived the respondents' rights under the deed, rendering it enforceable.

Consequently, the appeal was dismissed with costs.

Orders

Orders of the court

Appeal is dismissed with costs.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

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

BATHURST CJ BATHURST CJ

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by: BATHURST CJ, BATHURST CJ

Full text does not contain this section.

Medium Neutral Citation:	MacDonald v Raupach [2011] NSWCA 320
Hearing dates:	30 September 2011
Decision date:	30 September 2011
Before:	Bathurst CJ at [26] [31] Young JA at [1]; Sackville AJA at [27]
Decision:	Appeal is dismissed with costs. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	BANKRUPTCY- provable debts- bankrupt entered into a deed for payment of $100,000 to settle a District Court action in which he was a third party- deed entered into for relationship's sake not because of pre-existing liability- only paid $20,000- primary judge ordered appellant to pay $80,000 plus interest and costs- money due under deed not a provable debt because not a contingent debt existing at the time of the bankruptcy- bankruptcy later annulled because of composition- effect of annulment of bankruptcy is as if bankruptcy never occurred in the first place- no leave to proceed against the bankrupt in the District Court had been obtained- this did not vitiate- in any event annulment made the defect otiose- even if a provable debt, respondents' rights revived after annulment- deed enforceable- appeal dismissed.
Legislation Cited:	Bankruptcy Act 1966 (Cth) ss 82, 149 Contracts Review Act 1980
Cases Cited:	Foots v Southern Cross Mine Management Pty Limited [2007] HCA 56; 234 CLR 52 Lewis v Combell Constructions Pty Ltd (1989) 18 NSWLR 528 Re Coyle (1993) 42 FCR 72 Re Giuca; Ex parte The Bankrupts (1986) 70 ALR 219 Re Spratt; Ex parte Wilde (1986) 10 FCR 544 Reynolds v Reynolds [1977] 2 NSWLR 295 Union Club v Battenberg [2006] NSWCA 72; 66 NSWLR 1 Wilde v Spratt (1986) 13 FCR 284
Category:	Principal judgment
Parties:	Neil MacDonald (Appellant) Douglas Raupach (First Respondent) Enrico Di Lario (Second Respondent) Sandra Simone Di Lario (Third Respondent)
Representation:	Counsel: Appellant in person V Bedrossian (First Respondent) R M Higgins (Second and Third Respondents) Solicitors: Appellant self represented Accentro Legal (First Respondent) Hunter Lawyers (Second and Third Respondents)
File Number(s):	CA 2007/261840
Decision under appeal	Citation: Raupach v MacDonald [2010] NSWSC 1326 Date of Decision: 2010-11-24 00:00:00 Before: Price J File Number(s): SC 2007/261840