Maroevic, D.S. v Facy, R

[1989] FCA 356

CATCHWORDS

BANKRUPTCY - B a n k r u ~ t c y A c t 1 9 6 6 para. 4 0 ( 1 ) ( g ) - w h e t h e r

c o u n t e r - c l a l m , set-off or cross d e m a n d established - test

t o be appl ied - p r l m a facie case.

B a n k r u p t c y A c t 1 9 6 6 : S 4 0 ( l ) ( g )

DARIBOR STEPHAN MAROEVIC	V	RONALD FACY
Q2 380 of 1988

LOCKHART,	HARTIGAN and H I L L JJ.
BRISBANE

21 A P R I L 1989

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IN THE FEDERAL COURT OF AUSTRALIA	)
1
QUEENSLAND DISTRICT REGISTRY	) NO. QG380 of 1988
)

GENERAL DIVISION 1

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OR QUEENSLAND EXERCISING FEDERAL JURISDICTION IN BANKRUPTCY

BETWEEN: DARIBOR STEPHAN MAROEVIC

Appellant

AND :  RONALD FACY

Responlent

JUDGES MAKING ORDER:	LOCKHART, HARTIGAN and HILL JJ.
DATE ORDER MADE:	21 APRIL 1989
WHERE ORDER MADE:	BRISBANE

MINUTES OF ORDER

THE COURT ORDERS THAT:

1. The appeal be dismissed;

2.    The appellant pay the respondent's costs of the appeal.

.

NOTE:	Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA	)
1
QUEENSLAND DISTRICT REGISTRY	)  No. QG380 of 1988
)
GENERAL DIVISION	)

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OR QUEENSLAND EXERCISING FEDERAL JURISDICTION IN BANKRUPTCY

BETWEEN :  DARIBOR STEPHAN MAROEVIC

Appellant

AND :  RONALD FACY

Respondent

COURT: LOCKHART, HARTIGAN and HILL JJ.

DATE: 21 APRIL 1989

REASONS FOR JUDGMENT

THE COURT

This ie an appeal from the judgment of Kneipp J. in the Honour heard an application by Daribor Stephan Maroevlc, the	Supreme. Court of Queensland in a bankruptcy matter. His
appellant, pursuant to para. 40(1)(g) of the Bankruptcy Act 1966, that he had a counter-claim, set-off or cross demand which he could not have set up in the ac!tion in which the relevant judgment was obtained and which was equal to or exceeded the judgment sum of $5,887.46.
The bankruptcy proceedings arose out of an incident which took place on 12 March 1983 involving the appellant and the respondent which led to the respondent being wounded by a gun shot. The appellant was charged with a criminal offence in relation to the incident, and he was convicted by a jury. The respondent, Ronald Facy, subsequently sued the appellant for damages for personal injuries arising out of the incident in the Magistrates Court of Queensland. The appellant unsuccessfully defended those proceedings and judgment was entered for the respondent on 30 January 1985 in the amount previously mentioned. That judgment is the foundation of the bankruptcy notice which the respondent caused to be issued and served on the appellant.
Kneipp J. heard the bankruptcy matter and gave judgment on 5 December 1988. His Honour held that he was not satisfied that the appellant had a counter-claim, set-off or cross demand of the requisite kind. His Honour ordered the appellant to pay the respondent's costs. The appellant appeals to this Court from the judgment of Kneipp J.
In his reasons for judgment, Kneipp J. noted that the appellant had been involved in a large variety of proceedings of various types and in varlous courts. His Honour said that he had no doubt that those proceedings-*had involved the appellant, and probably also his family, in a great deal of unhappiness.
His Honour questioned who had really been responsible for the state of affairs and noted that the appellant genuinely believed that all his subsequent misfortunes had been the result of mrsdoings on the part of the respondent. The appellant suggested that in fact there had been, at all material times, a gigantic conspiracy involving, amongst others, probation officers, police officers, and judges. The appellant relied specifically on the shooting incident referred to as a basis for a claim for damages asserting that a threat was made to his life.
His Honour said that the fact that the appellant had been involved in two proceedings relating to that incident, each of which had been decided adversely to him, showed that his prospects of making any claim for damages arising out of those proceedings would be negligible. His Honour also said that the appellant complained specifically of damages alleged to have been done to his property, but the respondent was not one of those who was personally responsible and there was not any admissible evidence before his Honour which could suggest that he was responsible.

I .

It was also alleged by the appellant before Kneipp J. that the respondent had, on other occasions, made threats against the appellant or members of his family. Kneipp J. decided that it was not possible to ent<r usefully on any attempt to marshal and analyse the contents of the appellant's affidavit, which was on the file. His Honour said that having done his best to understand the affidavit

and the basis on which the appellant proposed to found any claim he may have had against the respondent, he thought that his prospects of establishing any claim which could be regarded as the basis of the counter-claim, set-off, or cross demand within the meaning of para. 40(l)(g) were negligible.

According to the test applied by his Honour, what has to

be shown is that there is a genuine claim in the sense that

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it is one likely to succeed or one that is at least reasonably arguable. His Honour concluded that the appellant had not satisfied him as to those matters and that his clalm must be dismissed.

The appellant's notice of appeal to this Court, which covers some six pages, makes allegations of various kinds including alleged conspiracy against the appellant by the respondent and members of his family, police officers, court officers, the judiciary and others, much of which is reminiscent of the assertions made before the Supreme Court

The appellant argued his case before us in person. We earlier refused an application to adjourn the matter when the	appellant told us he wished to obtain legal aid. We did not
think, in all the circumstances, any useful purpose would be served by adjourning the matter at that stage.
The appellant has argued his case before us calmly and clearly, and we understand the nature of his submissions, and have listened to them carefully. The tests which are to be applied by courts in cases of this nature are well known, and it is sufficient to refer to one or two cases. In Re Brink; Ex parte The Commercial Banking Company of Sydney Ltd. (1980) 44 FLR 135, a single Judge of this Court said that the correct test was that enunciated by the High Court in Ebert v Union Trustee Company of Australia Ltd. (1960) 104 CLR 346, especially at p. 350. In Re Brink the test was stated as being that a debtor must show that he has a prima facie case. Ebert's Case did not decide that the court hearing the matter under para. 40(l)(g) of the Bankruptcy Act must undertake a preliminary trial of the counter-claim, set-off or cross demand. Rather, the test is that the court must be satisfied that the debtor has a fair chance of success. That statement of principle has since been followed and applied in various cases, including In Re Gould; Ex parte Skinner (1983) 72 FLR 393 at 405. The test which Kneipp J. applied is, in our view, the test to which the Court has just referred and was the correct test to apply.
His Honour reached the conclusion he did after hearrng all the material before him, and the submissions advanced to him, and in our view the reasons for judgment of his Honour have not been demonstrated to have been in error. In all the
circumstances we are satisfied that the appeal must be dismissed.

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Accordingly, the order of the Court is that the appeal

be dismissed and that the appellant pay the respondent's
costs of the appeal.

I certify that this and the preceding
five ( 5 ) pages are a true copy of the reasons for judgment herein of the

court. A ,

pp& ssoc ate

Date: 21 April 1989

Daribor Stephan Moroevic - the Appellant (in person)

Counsel for Respondent: Mr. K.T. Kilvington

Solicitor for Respondent:

Date of Hearing:	21 April 1989
Date of Judgment:	21 April 1989