McMahon v Permanent Custodians Ltd - [2014] FCCA 216

FEDERAL CIRCUIT COURT OF AUSTRALIA

MCMAHON v PERMANENT CUSTODIANS LTD

[2014] FCCA 216

Catchwords:
PRACTICE AND PROCEDURE – Application for adjournment – where affidavit recently served on bankrupt filed to correct debt owed – where bankrupt claimed lack of readiness to proceed to hearing of own application – whether to grant adjournment.

BANKRUPTCY – Sequestration orders – application for review of Registrar’s decision to make sequestration orders – where bankrupt seeks to appeal decision not to set aside consent orders establishing debt upon which sequestration order based – where bankrupt previously appealed decision before New South Wales Court of Appeal – where prospects of success of appeal discussed by High Court in related proceedings – whether real prospects of success of appeal – where applicants claim third party can pay debts – where no evidence of capacity of third party to pay debts – whether to set aside sequestration order.

Legislation:

Farm Debt Mediation Act1994 (NSW), s.11
Real Property Act 1900 (NSW), s.57(2)(b)

Ahern v Deputy Commissioner of Taxation (Qld)(1987) 76 ALR 137

Narain v Euroasia (Pacific) Pty Ltd [2010] FCA 1352

Applicant:

ROBYN SANDRA MCMAHON

Respondent:

PERMANENT CUSTODIANS LTD

File Number:

SYG 2917 of 2012

Applicant:

JOHN TERENCE MICHAEL MCMAHON

Respondent:

PERMANENT CUSTODIANS LTD

File Number:

SYG 2918 of 2012

Judgment of:

Judge Raphael

Hearing date:

3 February 2014

Date of Last Submission:

3 February 2014

Delivered at:

Sydney

Delivered on:

3 February 2014

REPRESENTATION

For the Applicants:

Mr McMahon in person

Counsel for the Respondent:

Mr D Barnett

Solicitors for the Respondent:

Gillis Delaney Lawyers

ORDERS

The matter be stood over to 14.15 on 3 February 2014.
The application for review of the decision of Registrar Hannigan is dismissed.
The applicant debtor must pay the respondent creditor’s costs to be taxed, if not agreed, and paid in the same priority as those of the judgment creditor.

FEDERAL CIRCUIT COURT
OF AUSTRALIA

AT SYDNEY

SYG 2917of 2012

ROBYN SANDRA MCMAHON

Applicant

And

PERMANENT CUSTODIANS LIMITED

Respondent

SYG 2918 of 2012

JOHN TERENCE MICHAEL MCMAHON

Applicant

And

PERMANENT CUSTODIANS LIMITED

Respondent

REASONS FOR JUDGMENT

Decision in relation to application for an adjournment

In this matter the applicant debtor comes before me seeking an adjournment of his application for review of a decision of Registrar Wall made on 1 November 2013 to make an order sequestrating his estate and that of his wife Ms Robyn Sandra McMahon. The basis of the request for the adjournment is that he has only recently been served with an affidavit apparently filed on 20 December 2013 by Mr Raymond David Perkes, the solicitor for the applicant creditor.
The importance of the affidavit is to set out the history of the matter and to provide the court with advice that since the sequestration order was made a sale of property has occurred and thus the amount owed by the applicant debtors has reduced. This caused the creditor to conclude that, for the avoidance of doubt, he should file an amended creditor’s petition indicating…

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 McMahon v Permanent Custodians Ltd

Details

AGLC: McMahon v Permanent Custodians Ltd [2014] FCCA 216
Case: [2014] FCCA 216
Decision Date: 3 February 2014

CaseChat Overview and Summary

McMahon v Permanent Custodians Ltd concerned an application for the review of a Registrar’s decision to make sequestration orders against the applicant, Mr. McMahon. The applicant sought to appeal a decision not to set aside consent orders that established the debt upon which the sequestration order was based. The matter came before Judge Raphael in the Supreme Court of New South Wales.

The primary legal issues before the Court were whether to grant an adjournment of the hearing of Mr. McMahon's application, given that an affidavit correcting the debt owed had been recently served, and Mr. McMahon claimed he was not ready to proceed. Further, the Court had to determine whether to set aside the sequestration order, considering the applicant's claim that a third party could pay the debts, and the prospects of success of his appeal against the consent orders, which had been discussed by the High Court in related proceedings.

Judge Raphael refused the adjournment, finding that the applicant had not demonstrated a lack of readiness to proceed, particularly as the affidavit served was to correct an existing debt. Regarding the sequestration order, the Court noted that while the applicant claimed a third party could pay the debts, no evidence of this third party's capacity to do so had been presented. Furthermore, the Court considered the High Court's previous observations regarding the prospects of success of the applicant's appeal against the consent orders, which indicated a low likelihood of success. Consequently, the Court found no basis to set aside the sequestration order.

Orders