Marshall v Clarke (No 2) - [2004] FMCA 371

FEDERAL MAGISTRATES COURT OF AUSTRALIA

MARSHALL & ANOR v CLARKE & ORS (No 2)

[2004] FMCA 371

BANKRUPTCY – Costs.

Bankruptcy Act 1966, ss.222, 239

Marshall & Anor v Clarke & Ors [2003] FMCA 473
Re Morris ex parte Adams (1980) 48 FLR 481

Applicants:

PETER NEIL MARSHALL and
RENA MARIE MARSHALL

First Respondents:

ROBERT MICHAEL CLARKE and NARELLE LOUISE CLARKE

Second Respondent:

CHRISTOPHER MICHAEL WILLIAMSON

File No:

WZ 193 of 2002

Delivered on:

11 June 2004

Delivered at:

Melbourne

Date of Last Submissions:

22 March 2004

Judgment of:

McInnis FM

REPRESENTATION

Counsel for the Applicants:

Mr G Mohen

Solicitors for the Applicants:

Friedman Lurie Singh

First Respondents:

No appearance

Counsel for the Second Respondent:

Mr C McLeod

Solicitors for the Second Respondent:

Deacons

ORDERS

The First Respondents shall pay the Applicants’ costs of and incidental to the application including any reserved costs to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.
The Applicants shall pay 60% of the Second Respondent’s costs up to and including the hearing on 13 November 2002 including any reserved costs to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.
UNTIL FURTHER ORDER the Second Respondent by its servants or agents be restrained from paying funds held in respect of the compositions of the First Respondents or making any other payments from the funds without further order of the Court pending determination of an application to be made by the Applicants for the bankruptcy of the First Respondents.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

WZ 193 of 2002

PETER NEIL MARSHALL AND RENA MARIE MARSHALL

Applicants

And

ROBERT MICHAEL CLARKE AND NARELLE LOUISE CLARKE

First Respondents

And

CHRISTOPHER WILLIAMSON

Second Respondent

REASONS FOR JUDGMENT

This is a judgment in relation to the appropriate order for costs arising from judgment in the matter whereby specific orders were made as follows:-
(1)Pursuant to s.222 of the Bankruptcy Act 1966 the First Respondent’s Composition under Part X dated 19 December 2001 is declared void.
(2)The time for making Application pursuant to s.239 of the Bankruptcy Act be extended to 17 June 2002.
(3)Pursuant to s.239 of the Bankruptcy Act 1966 the Composition under Part X of the Bankruptcy Act 1966 of Robert Michael Clarke and Narelle Louise Clarke dated 19 December 2001 be set aside.
At the time when those orders were made and judgment delivered (see Marshall & Anor v Clarke & Ors [2003] FMCA 473) the Court invited Counsel to make submissions in relation to costs. Both Counsel decided to file and serve written submissions. The time for filing and serving of written submissions was extended at the request of the parties on two occasions. Ultimately submissions were received by the parties with the Applicant’s submissions filed 12 March 2004 and the Second Respondents’ submissions filed 22 March 2004.
The decision of the Court dealt with an application by the Applicants Peter Neil Marshall (the first Applicant) and…

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 Marshall v Clarke (No 2)

Details

AGLC: Marshall v Clarke (No 2) [2004] FMCA 371
Case: [2004] FMCA 371
Decision Date: 11 June 2004

CaseChat Overview and Summary

The applicants sought an injunction and orders regarding the payment of funds from the second respondent to the first respondents, who were in the process of bankruptcy. The application was made in the Federal Court of Australia. The applicants argued that the second respondent, holding funds in respect of the first respondents' bankruptcy, should not distribute these funds without court approval. The primary legal issue was whether the second respondent could lawfully transfer the funds to the first respondents, given the applicants' claim that the transfer would prejudice their interests in the bankruptcy proceedings.

The court examined the jurisdiction of the Federal Court under the Bankruptcy Act and the relevant provisions governing the administration of bankruptcy estates. It was noted that the court has the power to make orders regarding the management of assets in bankruptcy, particularly to prevent prejudice to creditors. The court also considered the nature of the applicants' interest and the potential impact of the transfer of funds. The court found that the applicants had established a sufficient likelihood of prejudice to their interests in the bankruptcy proceedings, warranting the issuance of an injunction to restrain the second respondent from transferring the funds to the first respondents.

The court issued an injunction to prevent the second respondent from transferring the funds to the first respondents. It ordered that the second respondent could only make such payments with further court approval, pending the determination of an application for the bankruptcy of the first respondents. The court also made orders regarding the costs of the application, requiring the first respondents to pay the applicants' costs and the applicants to pay a portion of the second respondent's costs. This decision underscores the court's role in ensuring the fair administration of bankruptcy proceedings and the protection of creditors' interests.

Orders

Orders of the court

The First Respondents shall pay the Applicants’ costs of and incidental to the application including any reserved costs to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.

The Applicants shall pay 60% of the Second Respondent’s costs up to and including the hearing on 13 November 2002 including any reserved costs to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.

UNTIL FURTHER ORDER the Second Respondent by its servants or agents be restrained from paying funds held in respect of the compositions of the First Respondents or making any other payments from the funds without further order of the Court pending determination of an application to be made by the Applicants for the bankruptcy of the First Respondents.

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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