BANKRUPTCY - Dismissal of creditors petition - whether earlier dismissal by consent of application to set aside bankruptcy notice created an issue estoppel as to whether true debt underlying judgment - discussion of issues for determination on application to set aside bankruptcy notice and on hearing of creditors petition - issues not the same - whether exercise of Court's discretion to go behind judgment necessarily a two stage process.
ISSUE ESTOPPEL - Application dismissed by consent - interlocutory proceedings - application of Anshun principle.
EVIDENCE - Application to admit fresh evidence on appeal - power of Court - appellant taken by surprise at trial - deliberate course taken not to adduce the evidence - objections on grounds of lateness and inadmissibility not taken or not pressed at trial.
JACQUES EZZAT MAKHOUL v ROBYN BARNES also known as ROBYN LESLEY MAKHOUL
No QG 86 of 1995
CORAM: Hill, Cooper & Branson JJ PLACE: Sydney (Heard in Brisbane) DATED: 24 November 1995
IN THE FEDERAL COURT OF AUSTRALIA ) ) QUEENSLAND DISTRICT REGISTRY ) No QG 86 of 1995 ) GENERAL DIVISION )
ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:JACQUES EZZAT MAKHOUL
Appellant
AND:ROBYN BARNES also known as
ROBYN LESLEY MAKHOUL
Respondent
CORAM: HILL, COOPER & BRANSON JJ PLACE: SYDNEY (Heard in Brisbane) DATED: 24 NOVEMBER 1995
MINUTES OF ORDER
THE COURT ORDERS THAT:
(1)The appeal be dismissed.
(2)The appellant pay the respondent's costs of and incidental to the appeal, including reserved costs,…
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.
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AGLC
Makhoul v Barnes [1995] FCA 953
Case
[1995] FCA 953
Decision Date
CaseChat Overview and Summary
The case of Makhoul v Barnes concerns an appeal against the dismissal of a creditor's petition. The petitioner, Jacques Makhoul, sought to have his ex-wife, Robyn Barnes, declared bankrupt. Barnes had previously been the subject of a District Court judgment, which formed the basis for the bankruptcy notice and subsequent petition. The primary judge dismissed the petition on the basis that there were reasonable grounds to doubt the existence of a debt underlying the judgment, thereby declining to exercise the discretionary power to grant a sequestration order. Makhoul appeals the dismissal of the petition, arguing that the judge erred in several respects, including the admission of certain evidence, the application of issue estoppel, and the failure to order a trial on the existence of the debt. The appeal also includes an application to admit fresh evidence on appeal.
The court begins by addressing the application to admit fresh evidence, which it denies. The court holds that the Federal Court Rules do not apply to bankruptcy proceedings and that the Bankruptcy Rules do not provide for the admission of fresh evidence on appeal. The court also finds that the petitioner had ample opportunity to present additional evidence at the trial and deliberately chose not to, making the application for fresh evidence on appeal inappropriate.
The court then examines the objections to the admissibility of evidence presented at the trial. Makhoul argues that the evidence should not have been admitted because it was filed late and was otherwise inadmissible. The court finds these objections to be without merit, as the petitioner did not object to the admissibility of the evidence at trial and any objections to late filing were not pursued. The court holds that the petitioner cannot now challenge the admissibility of evidence that was not objected to at trial.
Next, the court addresses the issue of issue estoppel. Makhoul argues that Barnes is estopped from challenging the existence of the underlying debt due to the dismissal of her application to set aside the bankruptcy notice. The court examines the principles of issue estoppel and concludes that the dismissal of the application to set aside the bankruptcy notice does not create an issue estoppel with respect to the existence of the underlying debt. The court reasons that the issues involved in the application to set aside the bankruptcy notice are not the same as those considered in the petition proceedings, and that the dismissal of the application does not preclude the petitioner from raising the issue of the existence of the debt at the petition stage.
The court further holds that the principles in Port of Melbourne Authority v Anshun Pty Ltd do not apply to this case, as the dismissal of the application to set aside the bankruptcy notice did not involve a finding inconsistent with the validity of the bankruptcy notice. The court also concludes that the judge did not err in dismissing the petition, as the petitioner did not establish the existence of a debt in the amount claimed. The court finds that the evidence presented at trial did not support the petitioner's claim, and that the dismissal of the petition was a proper exercise of the judge's discretion.
In summary, the court dismisses the appeal and denies the application to admit fresh evidence. The court holds that the petitioner has failed to demonstrate any error on the part of the primary judge in dismissing the creditor's petition.