Miller v Ghosh
[2016] FCCA 1191
•11 May 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| MILLER v GHOSH | [2016] FCCA 1191 |
| Catchwords: BANKRUPTCY – Application for substitution of petitioning creditor – whether debt owed to substituting creditor as at the date of act of bankruptcy – whether grounds for sequestration order established – order for substitution and sequestration order made. |
| Legislation: Bankruptcy Act 1966 (Cth), s.40(1)(g), 47, 49, 52(1) |
| Applicant: | RODNEY MILLER |
| Respondent: | RATNA GHOSH |
| File Number: | SYG 235 of 2015 |
| Judgment of: | Judge Manousaridis |
| Hearing date: | 11 May 2016 |
| Delivered at: | Sydney |
| Delivered on: | 11 May 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr M. Maconachie |
| Solicitors for the Applicant: | Higgins & Dix |
| No appearance by or on behalf of the respondent. |
ORDERS
The application made by Dr Ghosh to adjourn the hearing is dismissed.
Pursuant to s.49 of the Bankruptcy Act 1966 (Cth), Rodney Miller is substituted for Baycorp Collections PDL (Australia) Pty Limited as the petitioning creditor, and the petition may be proceeded with as if Rodney Miller has been the petitioning creditor.
Mr Miller has leave to file and rely on the creditor’s petition in the form of the amended creditor’s petition that was filed in Court on 11 May 2016.
The estate of Ratna Ghosh be sequestrated under the Bankruptcy Act 1966.
The applicant creditor’s costs be paid from the estate of the respondent debtor in accordance with the Bankruptcy Act 1966.
Scott Anthony Newton be appointed trustee of the estate of Ratna Ghosh.
The official trustee be notified of these orders within 2 business days.
THE COURT NOTES THAT:
The date of the act of bankruptcy is 18 November 2014.
A consent to act as trustee signed by Scott Anthony Newton has been filed under section 156A of the Bankruptcy Act 1966.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 235 of 2015
| RODNEY MILLER |
Applicant
And
| RATNA GHOSH |
Respondent
REASONS FOR JUDGMENT
(revised from transcript)
On 19 April 2016 there came before me an interim application filed by Mr Rodney Miller for an order that he be substituted as creditor. On that day, the respondent, Dr Ghosh, applied for an adjournment over the opposition of counsel for Mr Miller. I did not hear the application for substitution. Instead, I ordered that:
The hearing of the interim application for substitution by Mr Miller as petitioning creditor and, if an order for substitution is made, the hearing of the amended creditor’s petition are set down for hearing at 10.15 am on 11 May 2016.
I also made orders that, by 3 May 2016, Dr Ghosh file and serve a notice of grounds of opposition to the interim application for substitution and, if an order for substitution is made, to the amended creditor’s petition, and all affidavits on which Dr Ghosh wishes to rely.
Dr Ghosh has not complied with these orders. Instead, on 3 May 2016 Dr Ghosh sent to the Court a document titled “Written Submissions” in which she asserted that, on her instructions, her counsel, Mr Soon, requested that documents be served on him, but, in an email Mr Soon sent to Dr Ghosh on 27 April 2016, Mr Soon said he had not received any documentation from counsel for Mr Miller. Dr Ghosh made a number of other assertions to which I will refer shortly. In addition, on 11 May 2016 Dr Ghosh sent three emails requesting that today’s hearing be adjourned. The principal ground on which she relied was the medical condition of her son. In the last of her three emails, being the email Dr Gosh sent to the Court at 10.05 this morning, Dr Ghosh provided what purported to be an email from a doctor certifying that Dr Ghosh was unfit to attend court today because she is the carer of her son, who was sick at home from school.
At the commencement of the hearing, it was apparent Dr Ghosh would not appear and, after the matter was called, Dr Ghosh did not appear. I drew to the attention of counsel for Mr Miller correspondence that Dr Ghosh had sent to the Court, and indicated I proposed to treat that correspondence as constituting both an application by Dr Ghosh for an adjournment of the hearing of Mr Miller’s application to be substituted as a creditor and, if substituted, for the making of a sequestration order, and as stating the grounds on which Dr Ghosh sought the adjournment. Counsel for Mr Miller opposed the application for an adjournment I invited counsel for Mr Miller to address the question of whether an adjournment should be granted. I also invited counsel to tender the material on which he relied in support of Mr Miller being substituted as a creditor; and, if such an order were to be made, in support of the Court amending the creditor’s petition; and, if amended, making a sequestration order; and to make submissions on each of those matters. Counsel did so. I first turn, therefore, to Dr Ghosh’s application for an adjournment.
Whether or not a court should adjourn a hearing is within the discretion of the Court. The proper exercise of that discretion normally requires the Court to consider at least two things. The first is whether the party applying for the adjournment has offered a reasonable explanation for his or her not being in a position to proceed with the hearing of the matter that he or she seeks to be adjourned. The second is whether there would be any utility in adjourning the matter in any event. I first turn to the grounds on which Dr Ghosh seeks the adjournment. The first is that Dr Ghosh’s counsel has not received relevant documents. Although she does not expressly so state, it appears Dr Ghosh impliedly asserts that she has not been served with documents relevant to Mr Miller’s application for substitution and, if substituted, for the making of a sequestration order. If that is what Dr Ghosh intends to assert, I cannot accept it.
The application on which Mr Miller moves for an order that he be substituted as a creditor was one he filed on 2 September 2015. There is evidence, which I accept, that on 11 September 2015, Mr Cook, a process server, included the application together with other documents in an envelope addressed to Dr Ghosh, which he left under the front door of Dr Ghosh’s surgery. There is also evidence, which I accept, that on 2 October 2015, Mr Maher, the solicitor for Mr Miller, sent to Dr Ghosh by email a copy of, among other things, the application filed on 2 September 2015. The email address to which the documents were sent is the same email address from which Dr Ghosh sent the email communications of 11 May 2016 to which I have already referred. There is also evidence given by Mr Maher, which I accept, that on 13 April 2016, that he sent by email to Dr Ghosh a copy of, among other things, the application Mr Miller filed on 2 September 2015, a proposed amended creditor’s petition, and an affidavit of Mr Maher verifying paragraph 4 of the draft proposed amended creditor’s petition. The email address to which these documents were sent is the same email address from which Dr Ghosh sent the email communications of 11 May 2016 to which I have already referred.
Also relevant is the orders I made on 19 April 2016. Those orders made it clear that what was to be heard today was Mr Miller’s application that he be substituted as a creditor and, if that application were to be granted, there would be heard his application for a sequestration order. There is other evidence that is relevant. Counsel for Mr Miller tendered an email Mr Soon sent to counsel for Mr Miller on 27 April 2016 requesting that he would be grateful if he could receive a copy of Mr Miller’s application for substitution and the amended creditor’s petition. Mr Soon noted, however, that his receiving the documents would not constitute service on Dr Ghosh. There is also in evidence an email from Mr Soon to counsel for Mr Miller sent on 29 April 2016 in which Mr Soon says he no longer is briefed in the matter and, therefore, will not require the documents he had previously requested. In light of these emails sent by Mr Soon, whether or not he received the application filed by Mr Miller or any document relevant to the application that was before the Court today is irrelevant.
The second ground on which Dr Ghosh relies for an adjournment is that she has been unable to obtain counsel. There is no evidence of the attempts that Dr Ghosh made to obtain counsel or when she made those attempts. In any event, whether or not Dr Ghosh has been able to obtain counsel attracts very little weight in favour of my granting an adjournment. Dr Ghosh has had notice of Mr Miller’s application from at least the end of September 2015, and has known since 19 April 2016 that the Court would hear Mr Miller’s applications on 11 May 2016. Dr Ghosh has had sufficient time to obtain legal representation.
The third ground on which Dr Ghosh relies is the medical condition of her son. Mr Miller does not question the fact that Dr Ghosh’s son suffers from a medical condition. Counsel for Mr Miller submits, however, that Dr Ghosh has put on no evidence and, in any event, has given no explanation of whether she has made attempts to obtain alternative care arrangements for her son. Counsel therefore submitted I should place little weight on this ground. I accept counsel’s submission and I place little weight on the medical condition of Dr Ghosh’s son as constituting a reasonable explanation for Dr Ghosh not being in a position to appear at today’s hearing.
There is another matter to note. The medical condition of the applicant’s son does not explain why Dr Ghosh has not otherwise complied with the orders I made on 19 April 2016 which, as I have already noted, required her to file notice of grounds of opposition both to Mr Miller’s being substituted as a creditor and, if substituted as a creditor, to his obtaining a sequestration order.
For these reasons, I am not satisfied Dr Ghosh has provided any satisfactory or reasonable explanation for her not being in a position to attend today at the hearing or to prepare for it. This conclusion, however, might not be determinative if there was material before me that would suggest there would be utility in granting the adjournment, but there is no such material.
Dr Ghosh has not filed a notice of grounds of opposition or any evidence either to Mr Miller’s application to be substituted as a creditor or, if substituted, to his seeking a sequestration order. It is true that Dr Ghosh has asserted she has a cross-claim against Mr Miller, but there is no evidence of the nature of that cross-claim. It is also true that Dr Ghosh has asserted in an email she sent to the Court at 1.09 am on 11 May 2016 that the costs order Mr Miller is trying to enforce against her “will be determined in the Supreme Court on 27 May 2016”. The debt on which Mr Miller relies for his application to be substituted as a creditor, or at least one of the debts, and on which he proposes to rely in his proposed amended creditor’s petition, is a judgment debt for $7,000 entered in the District Court of New South Wales on 17 September 2014. Counsel for Mr Miller tendered a copy of orders made by the Supreme Court in proceedings number 2014/00333115-001 on 14 April 2016, which refers to the listing of a hearing on costs in relation to the dismissal of a summons filed in those proceedings. In other words, the hearing that is listed before the Supreme Court on 27 May 2016 to which Dr Ghosh appears to refer does not relate to the debt on which Mr Miller relies in his application to be substituted as a creditor.
In addition, Dr Ghosh asserts that she has given all her financial information to a “government debt agreement agency who have proposed a part 9 debt agreement”. Mr Miller has not responded. There is no evidence to support that assertion. Counsel for Mr Miller says his instructions are that Mr Miller is unaware of any proposed part 9 debt agreement. In any event, there is nothing before me that indicates a part 9 debt agreement is something of which Dr Ghosh can avail herself.
For these reasons, I am not satisfied it would be in the interests of justice to grant the adjournment Dr Ghosh requests. On the contrary, I am of the opinion that the interests of justice demands that I proceed with the applications that are before me. Accordingly, I will in due course make a formal order dismissing that application for an adjournment.
I now turn, finally, to the applications that are before the Court, the second application being conditional on the first application being successful. The first application is that made by Mr Miller in his interim application which he filed on 2 September 2015. That application is made pursuant to s.49 of the Bankruptcy Act 1966 (Cth) (Act). To obtain an order under s.49 of the Act, Mr Miller must establish that he has served the interim application and that Dr Ghosh owed a debt to Mr Miller as at the date on which Dr Ghosh committed the act of bankruptcy alleged in the current creditor’s petition. Based on the evidence I have identified already, I am satisfied Dr Ghosh was served with the interim application. I am also satisfied that Dr Ghosh has been served with the proposed amended creditor’s petition. As for the debt on which Mr Miller relies, I am satisfied that, as at 18 November 2014, being the date on which the current creditors petition alleges Dr Ghosh committed an act of bankruptcy, Dr Ghosh owed Mr Miller a debt of $7,000. That debt is the judgment debt entered in the District Court of New South Wales on 17 September 2014 in favour of Mr Miller against Dr Ghosh to which I have already referred.
In these circumstances, I am satisfied that it is proper that I make an order under s.49 of the Act that Mr Miller be substituted as petitioner, and that the petition may be proceeded with as if Mr Miller had been the petitioning creditor.
I now proceed to determine whether a sequestration should be made in reliance on the amended creditor’s petition. Here Mr Miller relies on the act of bankruptcy alleged in the creditors petition as originally filed, and on the previous creditor’s, that is to say, Baycorp’s, having complied with the requirements of the Act and the Federal Circuit Court (Bankruptcy) Rules 2016 (Bankruptcy Rules). It is to those matters I now turn.
The act of bankruptcy on which Baycorp Collections PDL (Australia) Pty Limited (Baycorp) relies is Dr Ghosh’s failure to comply with a bankruptcy notice. The relevant bankruptcy notice is that issued on 28 October 2014. The bankruptcy notice demanded payment of $11,265.01. The bankruptcy notice was served on Dr Ghosh by email and by post on 28 October 2014 (see affidavit of L. Wiggins made on 30 January 2015). Dr Ghosh did not comply with the bankruptcy notice within 21 days of service (see creditor’s petition paragraph 4 as originally filed). I find, therefore, Dr Ghosh committed an act of bankruptcy within the meaning of s.40(1)(g) of the Act, and the act of bankruptcy occurred on 18 November 2014.
Baycorp filed a creditor’s petition with this Court on 2 February 2015. The application was filed in accordance with the prescribed form. And on 2 February 2015, Mr J. Watson, on behalf of Baycorp, swore an affidavit verifying the amount as required by s.47 of the Act. The affidavit verifying Baycorp’s creditor’s petition also deposed to the matters referred to in r.4.04(1)(a) of the Bankruptcy Rules, and Baycorp filed an affidavit of Mr L. Wiggins deposing to the service of the bankruptcy notice on Dr Ghosh as required by r.4.04(1)(b) of the Bankruptcy Rules.
As required by r.4.05 of the Bankruptcy Rules, the creditors petition was served on Dr Ghosh on 18 September 2015, more than five days before 17 December 2015, being the date fixed for the hearing of the creditor’s petition (see affidavit of D. Wilkinson made on 18 September 2015). With the creditors petition there was served:
a)the affidavit required by r.4.04(1)(a) of the Bankruptcy Rules;
b)the affidavit of service of the bankruptcy notice made by Mr L. Wiggins; and
c)a consent to act as trustee.
I am satisfied, therefore, that Dr Ghosh has committed, as I have said, an act of bankruptcy on 18 November 2014, and that Baycorp complied with the requirements of the Bankruptcy Rules in relation to the filing and service of the creditor’s petition. Mr Miller as the substituted creditor is entitled to rely on these matters to support his application for the making of the sequestration order pursuant to the amended creditor’s petition. For his part, Mr Miller is required to comply with r.4.06(3) and r.4.06(4) of the Bankruptcy Rules.
To that end, on 10 May 2016 Mr Miller filed an affidavit sworn by Mr Maher on 10 May 2016 deposing to the matters required by r.4.06(3). Also on 10 May 2016, Mr Miller filed an affidavit sworn on 10 May 2016 by him in which he deposes that he relies on, among other debts, the $7,000 District Court judgment to which I have referred, and that that debt is still owing. Mr Miller also relies on an affidavit titled “affidavit verifying paragraph 4 of the petition”, being an affidavit which has purportedly been prepared pursuant to r.4.04 of the Bankruptcy Rules. In my opinion, that affidavit is not necessary for Mr Miller to establish an entitlement to the making of a sequestration order.
For all these reasons, therefore, I am satisfied that all the matters required to be proved under s.52(1) of the Act for the making of the sequestration order have been proved. I am also satisfied there is no reason why a sequestration order should not be made. I propose therefore to make a sequestration order against the estate of Dr Ghosh, and I also propose to make an order that Mr Miller’s costs be paid from the estate of Dr Ghosh in accordance with the Act.
I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis
Date: 16 May 2016
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