Meriton Apartments Pty Ltd v Rose
[2012] FMCA 133
•13 February 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MERITON APARTMENTS PTY LTD v ROSE | [2012] FMCA 133 |
| PRACTICE AND PROCEDURE – Adjournment – where previous adjournment had been granted for High Court proceedings to advance – where special leave to appeal to High Court not yet granted – where those proceedings likely to be lengthy – where dispute not new – whether to grant adjournment. BANKRUPTCY – Creditor’s petition – notice of objection – where notice of objection contained cross-claim previously held to be insufficient to set aside bankruptcy notice – notice of objection dismissed – whether to grant sequestration order. |
| Bankruptcy Act 1966 (Cth) s.52 |
| Guss v Johnston [2000] FCA 1455 Ahern v Deputy Commissioner of Taxation (Qld) (1987) 76 ALR 136 Re Lewin and Glasson; Ex parte Milner (1986) 67 ALR 591 Rose v Meriton Apartments Pty Ltd [2011] FMCA 721 |
| Applicant: | MERITON APARTMENTS PTY LTD |
| Respondent: | JOHN EMMANUEL ROSE |
| File Number: | SYG 2155 of 2011 |
| Judgment of: | Raphael FM |
| Hearing date: | 13 February 2012 |
| Date of Last Submission: | 13 February 2012 |
| Delivered at: | Sydney |
| Delivered on: | 13 February 2012 |
REPRESENTATION
| Solicitors for the Applicant: | Sally Nash and Co. Lawyers |
| Counsel for the Respondent: | Mr C Stuart |
| Solicitors for the Respondent: | Leigh Johnson Lawyers |
ORDERS
Application for an adjournment be dismissed.
Notice of Objection dismissed.
A sequestration order be made against the estate of John Emmanuel Rose.
The applicant’s costs (including any reserved costs) be taxed (in accordance with the Federal Magistrates Court (Bankruptcy) Rules 2006) and paid from the estate of the Respondent in accordance with the Act.
Under the Bankruptcy Regulations, a copy of this sequestration order be given to the Official Receiver in Sydney within two days.
All proceedings under this order be stayed for a period of 21 days.
THE COURT NOTES
That the date of the act of bankruptcy is 16 September 2011.
A consent to act as trustee has been signed by Maxwell Prentiss and has been lodged with the Official Receiver in Sydney.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2155 of 2011
| MERITON APARTMENTS PTY LTD |
Applicant
And
| JOHN EMMANUEL ROSE |
Respondent
REASONS FOR JUDGMENT
This matter came before me on 20 December 2011. It will be seen from the reasons that have been published that the petitioning creditor seeks to move on its petition for a debt of approximately $17,000.00 in respect of costs of a High Court application that were ordered against the respondent debtor.
On 20 December 2011, perhaps influenced by the approaching holidays and by the advocacy of Mr Stewart, I granted an adjournment of the petition until today because it seemed to me that there were conflicting arguments as to the appropriateness of continuing with this matter when the respondent had embarked on High Court proceedings which, if successful, would allow him to continue with certain other industrial proceedings that he had sought to commence against the creditor.
When the matter came back before me today, an affidavit was filed on behalf of the debtor by Elizabeth Jane McGill, a solicitor with conduct of the High Court proceedings. It should be made clear that the debt is in respect of the costs of other proceedings in the High Court, and not the current ones: see Guss v Johnston [2000] FCA 1455 at [13] referring to Ahern v Deputy Commissioner of Taxation (Qld) (1987) 76 ALR 136. The conduct of the High Court proceedings by Mr Rose, as the appellant, had not been as expeditious as one might have hoped, and certain documents that were required to be filed were filed out of time.
The respondent to that appeal could have brought some motion in the High Court to have the appeal dismissed, but does not appear to have done that. It has also not complied with its own obligations to file and serve its outline of argument. It applied for an extension of time for that until 3 February 2012, which was granted by the court, but no summary has been filed to date.
I am told today that Mr Rose is a legal practitioner with a current practising certificate. The debt that he owes to Meriton is not large but it has not been paid. There would seem to me to be no reason provided why Mr Rose could not have made some effort to pay down the debt from the earnings he could receive as a legal practitioner.
A creditor in the position of this applicant creditor is entitled to have the petition heard: Re Lewin and Glasson; Ex parte Milner (1986) 67 ALR 591. The existence of a possible claim against a creditor can, sometimes, be a reason for adjourning a petition. But, in this particular case, the situation is far from that. Special leave to appeal to the High Court has not been granted, and is unlikely to be granted in the near future. There is no evidence that Mr Rose has made any application arising out of the respondent’s failure to file its outline of argument in the appeal.
Even if special leave was granted, the hearing will be unlikely to take place for, at least, six months. And then one can assume a further three or four months before judgment. If Mr Rose is successful, all that would happen is that he would be allowed to proceed in the Industrial Court with his claim. That may not be determined finally for several years. Why should Meriton be prevented from taking steps to enforce its judgment for its $17,000.00 for that time, particularly when it is owed by a man who would seem to be capable of making arrangements for paying it?
In my view, the better course of action is to allow this petition to proceed. Mr Rose, as a legal practitioner and as a person who is represented in these proceedings, is capable of obtaining advice as to how he may deal with his bankruptcy, when it ensues, including his ability to have it annulled or for him to enter into a composition with his creditor, at which time he may continue with his litigation.
As the evidence that had been before me on the previous occasion shows, this is not a new dispute, but one that has been going through the court over a considerably lengthy period. See the decision of Barnes FM in Rose & Meriton Apartments Pty Ltd [2011] FMCA 721 for the history of these parties’ disputes, set out in some detail. For these reasons the application for the adjournment is dismissed.
In hearing the petition I was mindful of the existence of a notice of objection which, whilst asserting a cross‑claim, was effectively asserting the same cross‑claim that was considered by Barnes FM in the proceedings to which I have already referred. It was not held to be sufficient to allow the setting aside of the bankruptcy notice.
The existence of a cross‑claim is not a ground for declining to grant a sequestration order. Although it may influence the court when considering s. 52 of the Act. In reality, the purpose of the notice of objection seems to me to have been to pray it in aid of the application for the adjournment, which was argued before me both on 20 December 2011 and today. I will, therefore, dismiss the notice of objection.
I am satisfied that the respondent committed the act of bankruptcy alleged in the petition. I am satisfied of the proof of the other matters required by s.52 of the Bankruptcy Act 1966 (Cth)[1]. I make a sequestration order against the estate of John Emmanuel Rose. I order that the applicant’s costs, including any reserved costs, be taxed and paid from the estate of the respondent in accordance with the Act, and that under the Bankruptcy Regulations a copy of this sequestration order be given to the Official Receiver in Sydney within two days.
[1] The “Act”.
The court notes that the date of the act of bankruptcy is 16 December 2011. I note that a consent to act as trustee has been signed by Maxwell William Prentiss and has been lodged with the Official Receiver in Sydney. For the avoidance of doubt, the taxed costs shall include the costs of the hearing on 20 December 2011.
I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of Raphael FM
Date: 28 February 2012
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