Mercantile Mutual Custodians v O'Brien

FEDERAL COURT OF AUSTRALIA

Mercantile Mutual Custodians v O’Brien [2000] FCA 1627

BANKRUPTCY – creditor’s petition – where bankruptcy notice founded on two separate judgments – whether bankruptcy notice void

Bankruptcy Act 1966 (Cth)
Trade Practices Act 1974 (Cth) s 82

In Re Low; Ex parte Argentine Gold Fields [1891] 1 QB 147 - followed
Re Bond; Ex parte HongKongBank of Australia Limited (1991) 33 FCR 426 - cited
GPW Aussie Exports v Latin (1998) 85 FCR 324 - cited
Catalano v Commonwealth Bank of Australia (unreported, Federal Court, 3 July 1997) - distinguished
Re Wheeler [1982] 1 WLR 175 - distinguished
Cummings v Raeffaele FCA [2000] 675 - distinguished

MERCANTILE MUTUAL CUSTODIANS PTY LTD (ACN 008 508 496) v RYLE MATTHEW O’BRIEN

Q 7122 of 2000

SPENDER J
BRISBANE
8 NOVEMBER 2000

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q 7122 OF 2000

BETWEEN:	MERCANTILE MUTUAL CUSTODIANS PTY LTD (ACN 008 508 496) APPLICANT
AND:	RYLE MATTHEW O'BRIEN RESPONDENT
JUDGE:	SPENDER J
DATE OF ORDER:	8 NOVEMBER 2000
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.The creditor’s petition be dismissed.

2.There be no order as to costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q 7122 OF 2000

BETWEEN:	MERCANTILE MUTUAL CUSTODIANS PTY LTD (ACN 008 508 496) APPLICANT
AND:	RYLE MATTHEW O'BRIEN RESPONDENT

JUDGE:	SPENDER J
DATE:	8 NOVEMBER 2000
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. This is a contested creditor's petition.  The notice of opposition by the judgment debtor, Ryle Matthew O'Brien (Mr O'Brien) is that he has a valid counterclaim which he “could not set up in the Judgment of 18 October 1999 because of a legal obstacle”.  It is unnecessary, in light of what has occurred, to deal with that ground of opposition.  It seems, however, to involve a misunderstanding on Mr O'Brien's part as to what constitutes an inability to set up a counterclaim. 

2. The fact is that in the District Court action in which various orders and judgments were made against Mr O'Brien, there was pleaded on his behalf the counterclaim on which he now wishes to rely.  On 24 November 1999, Mr O'Brien (who then, as now, was acting on his own behalf) indicated to Noud DCJ that he did not then wish to proceed any further with his counterclaim, and his Honour then made orders including that the counterclaim be dismissed.  The reason that it is unnecessary to now deal with the stated ground of opposition arises from  a defect in the bankruptcy notice relied on to found the act of bankruptcy, which aspect of the notice was very properly brought to the Court's attention by counsel for the petitioning creditor. 

3. Notwithstanding counsel’s submissions to the contrary, in my judgment the bankruptcy notice is a nullity, because it is founded on two separate judgments. 

4. What happened was this:  Mr O'Brien leased a shop from Mercantile Mutual Custodians Pty Ltd.  On…