Melbourne's Cheapest Cars Pty Ltd v Ventra
[2008] FMCA 531
•8 April 2008
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MELBOURNE'S CHEAPEST CARS PTY LTD v VENTRA | [2008] FMCA 531 |
| BANKRUPTCY – Application to review sequestration order – desire of applicant to go behind County Court judgment – judgment regular – application dismissed. |
| Bankruptcy Act 1966, s.52(1) Federal Magistrates Court (Bankruptcy) Rules 2006, Part 4, r.4.06 |
| Totev v Sfar [2008] FCAFC 35 Wren v Mahony [1972] 126 CLR 212 |
| Applicant: | MELBOURNE'S CHEAPEST CARS PTY LTD (ACN 086 996 036) |
| Respondent: | GIUSEPPE VENTRA |
| File Number: | MLG 1676 of 2007 |
| Judgment of: | Burchardt FM |
| Hearing date: | 8 April 2008 |
| Date of Last Submission: | 8 April 2008 |
| Delivered at: | Melbourne |
| Delivered on: | 8 April 2008 |
REPRESENTATION
| Advocate for the Applicant: | Mr Worsnop |
| Solicitors for the Applicant: | Kahns Lawyers |
| Advocate for the Respondent: | Mr Boden |
| Solicitors for the Respondent: | Starnet Legal Pty Ltd Lawyers |
| Advocate for the Trustee: | Mr Harrick |
| Solicitors for the Trustee: | Harrick Lawyers |
ORDERS
THAT compliance with the Federal Magistrates Court (Bankruptcy) Rules, Part 4, Rule 4.06 be waived.
DECLARES
THAT the matters required to be proved by s.52(1) of the Bankruptcy Act 1966 are established.
THAT a Sequestration Order be made against the estate of Giuseppe Ventra.
THAT the Applicant Creditor’s costs be taxed in accordance with the Federal Court Rules and paid from the estate of the Respondent Debtor in accordance with the Bankruptcy Act 1966.
The Court notes that the date of the act of bankruptcy is 29 October 2007.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLG 1676 of 2007
| MELBOURNE'S CHEAPEST CARS PTY LTD |
Applicant
And
| GIUSEPPE VENTRA |
Respondent
REASONS FOR JUDGMENT
(Revised from Transcript)
As everybody present will recall, yesterday Mr Ventra sought an adjournment of the hearing of the creditor's petition. I rejected that application and gave my reasons for doing so. I then heard argument on the substantive issue as to whether or not I should make a sequestration order and reserved my decision until this morning.
It is readily apparent that this dispute has its origins in a hearing that took place before Judge Hampel in the County Court of Victoria. On 8 June 2007 her Honour gave judgment for the creditor in the sum of $149,985.80 together with costs. The debtor, Mr Ventra, did not appeal, rather he sought to proceed by way of judicial review. It appears that that course of action arose in part out of various constitutional arguments that had been previously raised before Judge Hampel.
I think it is perhaps sufficient to say that it comes as no surprise, at least to me, that that application was dismissed by Master Daly on 18 October 2007.
It should be noted, and it is important, that no application for leave to appeal out of time was made, either following the judgment in June or even following the dismissal of the application for judicial review by Master Daly on 18 October 2007 right up to the time the sequestration order was made by this Court on 14 February 2008.
A bankruptcy notice was served, which was the subject of a number of hearings in this Court, but it was not set aside. Accordingly, on 7 December 2007 a creditor's petition was filed, that ultimately led to a sequestration order made by Registrar Caporale on 14 February 2008.
I have the benefit of the recent Full Court of the Federal Court decision in the matter of Totev v Sfar [2008] FCAFC 35 (“Totev v Sfar”). That decision reaffirms that this hearing is a hearing de novo in which I need to be satisfied of all the matters required to be satisfied in s.52(1) of the Bankruptcy Act 1966 (“the Act”) and by the regulations before I can properly proceed to contemplate making any sequestration order.
I note, however, from the judgment of Emmett J at [15] in his reasons for decision, and elsewhere, and likewise in the judgment of Bennett J at [52] of the reasons in that case, that it seems fairly clear that the court has the power to dispense with compliance with r.4.06 of the Federal Magistrates Court (Bankruptcy) Rules 2006 (“the Rules”) as to affidavits.
In this case those matters have already been attended to by earlier affidavits, and, since service is not in issue and the debt is not in issue and nor is there any suggestion that there has been any composition of creditors, I think it is proper that I should order that compliance with r.4.06 be waived, thus obviating the necessity for the formality of further affidavits of debt and search and the like to be filed.
From the affidavits filed by the debtor it is clear that the essential basis on which he wishes to proceed is that the order of Judge Hampel should be set aside and the case re‑argued. If one goes to the affidavit of his solicitor, Mr Boaden, filed on 14 February 2008, the matters that Mr Boaden raises on his client's behalf are, first, that there would be an intention, should the sequestration order be set aside, to apply to the Court of Appeal out of time for leave to appeal; second, that Mr Ventra was unwell during the trial before Judge Hampel; and, third, that he was unable to properly represent himself at the trial because of its complexity.
It should be noted, in parenthesis, that Mr Boaden's affidavit shows that $67,500.00 had been received as a net sum from the sale of the former matrimonial home of Mr Ventra and that he had debts to his solicitors at that time of about $18,000.00 together of course with the judgment of Judge Hampel in excess of $149,000.00 together with costs and interest.
Annexed to or filed at the same time as Mr Boaden's affidavit was an affidavit from Mr Ross, who was an observer, who confirmed, amongst other things, that Mr Ventra had sought a jury trial and raised other constitutional arguments before Judge Hampel; although it should be interpolated that he was in some respects critical of the conduct of the trial by her Honour.
Mr Boaden has filed a further affidavit on 29 February 2008 which asserts that Mr Ventra would have successfully defended his case if he had been properly represented. That view was put on an assessment made by Mr Boaden, as I understand it, and by counsel.
There is also an affidavit by Mr Ventra filed on 7 April 2008 which goes to what took place at the trial in considerable detail. I make a few general points. First, Judge Hampel's judgment is clearly regular; there is no suggestion of fraud or collusion, or anything of that sort. Second, the debt arising from the Court's order in the County Court has not been paid.
Third, courts are generally reluctant to go behind a decision of another court absent collusion or fraud, particularly where, as here, there has been a contested hearing. In this regard I refer to the judgment of Menzies J in Wren v Mahony [1972] 126 CLR 212 at 236, which is to the effect I have just described. In my view, this is not an appropriate case to go behind Judge Hampel's decision, precisely because the courts will not generally do so where there has been a contested hearing; and there is no suggestion, if I can put the matter broadly, of misconduct.
However, even if one advances in the alternative, and I propose to do this, and one looks at Judge Hampel's decision in detail, one notes that, first, Mr Ventra was given guidance about the court, about how to conduct the trial; that is apparent from paragraph 7 of her Honour's decision.
Second, Mr Ventra ran a complicated, albeit, in my view, completely misconceived, series of arguments about jurisdiction, going to whether a proceeding such as the one before the judge could be heard without a jury, and in other respects.
Third, although Mr Ventra said that he would only participate in the trial under protest, as is recorded at paragraph 28 of her Honour's reasons, he either did not mention his alleged ill‑health to Judge Hampel - there is no reference to it in the decision - or he did so in such a way as to fail to alert her to it. The trial ran for some three days, or parts of days, and it is reasonable to infer that her Honour would have noticed any significant distress on Mr Ventra's part.
Fourth, there is nothing in Judge Hampel's judgment nor in the materials filed by Mr Ventra that leads me to conclude either that the result would be different if he had been legally‑represented or that there is any extra evidence, whether by way of cross‑examination of the witnesses called by the plaintiff in that proceeding, namely the judgment creditor here, or otherwise that would produce a different result.
Fifth, Judge Hampel made findings at paragraph 56 and following of dishonest conduct on the part of Mr Ventra that stand apart, in my view, from the supervision issue to which most of Mr Ventra's criticisms attach, and it is that dishonest conduct which was the real wellspring of the final judgment.
I am satisfied, as I have said, that I should not go behind the judgment, in any event, as it is regular and is not tainted with collusion or fraud, or, as far I can see, otherwise. But, as I have said, even if one goes behind the judgment and looks at it in light of the debtor's materials filed in this Court, it is clear that his criticisms are not such that I would be minded to any different outcome.
I certify that the preceding twenty (20) paragraphs are a true copy of the reasons for judgment of Burchardt FM
Associate: Brooke Evans
Date: 8 April 2008
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