FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MULHERN v PEARCE & ANOR | [2013] FMCA 229 |
| BANKRUPTCY – Annulment – whether the sequestration order ought not have been made – no steps taken by bankrupt to oppose creditor’s petition – non-cooperation by bankrupt – bankruptcy upheld. BANKRUPTCY – Overseas travel – application for return of documents and permission to travel overseas – bankrupt’s Australian passport confiscated – bankrupt’s Irish passport confiscated – bankrupt’s USA Green Card confiscated – whether the travel was genuine – whether the bankrupt was likely to return to Australia – whether the travel would hamper administration of the bankrupt’s estate – whether there were compassionate grounds for the travel – discretion of trustee – history of non-cooperation by bankrupt with trustee – application dismissed. COSTS – Security for costs – application for security for costs against bankrupt – security sought for interim and originating applications – security sought for costs incurred and future costs – factors to be considered when giving security for costs – whether the application for security was oppressive – bankrupt’s prospects of success – application unlikely to succeed – costs awarded. |
| Bankruptcy Act 1966 (Cth), ss.43B, 153B, 178, 272(1) Federal Magistrates Court Act 1999 (Cth), s.80 Federal Magistrates Court Rules 2001 (Cth), r.21.01 Federal Magistrates Court (Bankruptcy) Rules 2006 (Cth), r.1.32 |
| Body Corporate for Araucaria GTP 1790 v Massey [2009] FMCA 598 James v McEvoy and Anor [2011] FMCA 604 Khan v Melluish [2010] FMCA 119 Paramasivam v the State of New South Wales (No 2) [2007] FMCA 1033 Re Molina; Ex parte Wily [1995] FCA 1057 |
| Applicant: | MICHAEL RICHARD MULHERN |
| Respondent: | MARK WILLIAM PEARCE AND ANDREW JOHN HEERS AS TRUSTEES OF THE PROPERTY OF MICHAEL RICHARD MULHERN (A BANKRUPT) |
| File Number: | SYG 2805 of 2012 |
| Judgment of: | Burnett FM |
| Hearing date: | 25 March 2013 |
| Date of Last Submission: | 25 March 2013 |
| Delivered at: | Brisbane |
| Delivered on: | 25 March 2013 |
REPRESENTATION
| Solicitors for the Applicant: | Mr Michael Smith |
| Solicitors for the Respondent: | Lynch Morgan Lawyers |
ORDERS
That the Applicant’s Interim Application filed 15 February 2013 be dismissed.
That the Applicant pay the Respondents’ costs of and incidental of the Interim Application filed 15 February 2013 and these costs be the Respondents’ costs in the administration of the estate of the Applicant.
That the Applicant pay the sum of $68,158.77 to the Registrar of the Court as security for the costs of these proceedings within 14 days of the date of this order.
That these proceedings be stayed until the payment by the Applicant of the amount of security for costs so…
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- AGLC
- Mulhern v Pearce [2013] FMCA 229
- Case
- [2013] FMCA 229
- Decision Date
CaseChat Overview and Summary
The court had to determine whether the sequestration order should be annulled, considering the bankrupt's lack of cooperation and failure to oppose the creditor's petition. Additionally, the court needed to assess the bankrupt's application to travel overseas by examining the genuineness of the travel, the likelihood of the bankrupt's return, and the potential impact on the administration of the estate. The trustee's discretion in handling such matters was also a key consideration.
The court found that the sequestration order was valid as the bankrupt had not taken any steps to oppose the petition and had shown a history of non-cooperation with the trustee. The court rejected the application for travel, noting the bankrupt's past conduct and the absence of compelling compassionate grounds. Regarding the costs, the court held that the bankrupt should provide security for costs due to the low prospects of success of the bankrupt’s application, and awarded costs to the trustee.
The court made several orders, including dismissing the bankrupt’s interim application, awarding costs to the trustee, and requiring the bankrupt to provide security for costs. The proceedings were stayed until the security was paid, with a warning that failure to comply would result in the proceedings being dismissed and the costs becoming part of the estate.
Orders
Orders of the court
1.
That the Applicant’s Interim Application filed 15 February 2013 be dismissed.
2.
That the Applicant pay the Respondents’ costs of and incidental of the Interim Application filed 15 February 2013 and these costs be the Respondents’ costs in the administration of the estate of the Applicant.
3.
That the Applicant pay the sum of $68,158.77 to the Registrar of the Court as security for the costs of these proceedings within 14 days of the date of this order.
4.
That these proceedings be stayed until the payment by the Applicant of the amount of security for costs so ordered.
5.
That in the event that the Applicant does not comply with order 3 these proceedings shall be deemed dismissed and the costs of the proceedings shall be the Respondents’ costs in the administration of the estate of the Applicant.
6.
That the costs of and incidental to the Respondents’ Interim Application filed 21 March 2013 be paid by the Applicant and form part of the security for costs ordered pursuant to order 3.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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