McIntyre, I.B. v Perkes, R.D - [1990] FCA 454

Re: ITALA BELINDA McINTYRE and NEVILLE McINTYRE
Ex Parte: RAYMOND DAVID PERKES
Nos. NP2187 and 2188 of 1989
FED No. 454

COURT

IN THE FEDERAL COURT OF AUSTRALIA

BANKRUPTCY DISTRICT IN THE STATE OF NEW SOUTH WALES AND THE AUSTRALIAN CAPITAL TERRITORY
GENERAL DIVISION
Einfeld J.(1)

HEARING

SYDNEY

#DATE 28:8:1990

JUDGE1

This matter comes before the court as a creditor's petition by Raymond David Perkes (creditor) seeking a sequestration order against both Itala Belinda McIntyre and Neville McIntyre (debtors). In an ex tempore judgment I delivered in this matter on 6 March 1990, I pointed out that the substance of this dispute has a frighteningly long litigation history. Unfortunately, since that date, there has been further litigation in this matter. I cannot even express the hope, as has been done on previous occasions, that this judgment will dispose of the matter because an appeal, on another aspect of it, is already pending to the High Court of Australia. No doubt there will be an appeal from this judgment to a Full Court and to the High Court. This is a disgraceful misuse of public funds and facilities.

I will not here relate the facts and history of the dispute. They have been more than adequately covered in my judgment of 3 November 1989 in Re Carpenter; Ex parte Gye and in the judgments of a Full Court of this Court in related proceedings on 6 April 1990 and of Mr Justice Hill at first instance in those cases (unreported 27 September 1989), nos G694 and 695 of 1989.
Each of these parties is in debt to the other. The Full Court has said that one debt may be set off against the other. The substantive issue here is whether there is a remaining debt upon which a sequestration order can properly be pronounced as between the creditor and the debtors and, if so, what the debt is. These questions depend upon the date at which the respective judgment debts of the creditor and debtors are set off against each other.
Was the bankruptcy notice validly served?
A preliminary issue was raised by the debtors as to the adequacy of the service of the bankruptcy notice. Both parties accept as a fact that service of the bankruptcy notice on the debtors took place within the Law Courts Building. Further, they do not dispute that the parties were in attendance at the time to answer an allegation in an affidavit (tendered in support of a notice of motion to which they were not a party) that they had, in breach of a Mareva injunction, left Australia. The parties disagree on the question of the validity of service in these circumstances.
Counsel for the debtors relied on an authority dated more than two centuries ago for the proposition that such service is invalid. The case he cited was Cole v Hawkins (1738) Andrews 275. This was a matter dealing with a motion of attachment against an attorney who had served a document on…

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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Details

Case: [1990] FCA 454
Decision Date: 28 AUGUST 1990

CaseChat Overview and Summary

The Federal Court of Australia heard a case involving creditor Raymond David Perkes who sought a sequestration order against debtors Itala Belinda McIntyre and Neville McIntyre. This matter arose from a long-standing dispute with a history of litigation, and it was now being appealed to the High Court. The primary issue before the court was whether there existed a remaining debt between the creditor and the debtors that could form the basis of a sequestration order. The court also needed to determine the appropriate date to set off the respective judgments of the creditor and debtors. The validity of the service of the bankruptcy notice was another preliminary issue raised by the debtors.

The court examined the validity of the service of the bankruptcy notice, which took place within the Law Courts Building. The debtors argued that service in such circumstances was invalid, citing a historical case, Cole v Hawkins. However, the court found that this case did not apply to the present circumstances and that the service was valid. The court also considered more recent cases and concluded that personal service within the court constituted valid service, even if it amounted to contempt of court.

The substantive issue before the court involved the debts arising from two judgments: the McIntyre judgment in favour of Mrs McIntyre and the Perkes judgment in favour of the creditor. The court considered whether the Perkes judgment included an order for costs and, if so, at what date the two judgments should be set off. The court found that costs were not part of the judgment that could be used to sequestrate the debtors' estate. Regarding the date of set off, the court determined that the Full Court's decision required the set off to take place from the date the Perkes judgment took effect, which was 24 June 1988. As a result, there was no remaining debt to found a sequestration order, and the petition was dismissed. The creditor was ordered to pay the debtors' costs.

The court's decision brought to a close a lengthy and complex litigation history between the parties. The outcome ensured that the creditor's petition was dismissed, and the debtors were spared the burden of sequestration. The court's ruling on the validity of the service of the bankruptcy notice and the date of set off provided clarity in a matter that had seen extensive litigation. The creditor's costs award emphasised the importance of ensuring that litigation is conducted in a manner that does not unduly burden the parties or waste public resources.

Orders