Murdaca v Accounts Control Management Services Pty Ltd - [2007] FCA 964

FEDERAL COURT OF AUSTRALIA
Murdaca v Accounts Control Management Services Pty Ltd [2007] FCA 964
BANKRUPTCY APPEALS – failure to comply with bankruptcy notice which required payment of judgment debt within 21 days – judgment stayed between date of service of bankruptcy notice and expiry of time provided to comply with the notice – sequestration order nevertheless made against appellant’s estate – following unsuccessful appeal, appellant served with writ of possession – order sought to stay writ of possession and proceedings under the sequestration order pending determination of special leave application – consideration of prospect of success of special leave application, loss to the respondent and balance of convenience – Held: stay of writ of possession and proceedings under sequestration order granted
Bankruptcy Act 1966 (Cth) ss 37(2), 40(1)(g), 41(3)(b)
Federal Court of Australia Act 1976 (Cth) ss 25(1A), 27
CDJ v VAJ (1998) 197 CLR 172 cited
De Robillard v Carver [2007] FCAFC 73 cited
Jennings Construction Limited v Burgundy Royale Investments Pty Ltd (No 1) (1986) 161 CLR 681 applied
Lindholt v Merritt Madden Printing Pty Ltd [2002] FCA 260 distinguished
Makhoul v Barnes (1995) 60 FCR 572 cited
Re Dennis; Ex Parte Dennis (1888) 60 LT 348 referred to
Re Frasersmith; Ex Parte J Blackwood & Son Limited (1992) 36 FCR 144 referred to
Re Johnson; Ex Parte Johnson v Tonkin (1994) 53 FCR 70 referred to
Re Moss; Ex parte Tour Finance Ltd [1969] ALR 285 distinguished
Re Roberts; Ex Parte Bower (1994) 48 FCR 350 referred to
Re Sgambellone; Ex Parte Jacques (1994) 53 FCR 275 referred to
Schekeloff; Ex Parte Schekeloff v The Hopkins Group Pty Limited (1989) 22 FCR 407 questioned
Wiltshire-Smith v Mellor Olsson (1995) 57 FCR 572 distinguished
ANTHONY MURDACA v ACCOUNTS CONTROL MANAGEMENT SERVICES PTY LTD AND JASON LLOYD PORTER AND IAN CHARLES FRANCIS (AS TRUSTEE IN BANKRUPTCY)
NSD 2268 OF 2006
BRANSON J
22 JUNE 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 2268 OF 2006

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN:

ANTHONY MURDACA
Appellant

AND:

ACCOUNTS CONTROL MANAGEMENT SERVICES PTY LTD
First Respondent

JASON LLOYD PORTER AND IAN CHARLES FRANCIS (AS TRUSTEE IN BANKRUPTCY)
Second Respondent

JUDGE:

BRANSON J

DATE OF ORDER:

22 JUNE 2007

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:
1.The writ of possession directed to the Sheriff of New South Wales dated 31 May 2007 be stayed until the hearing or earlier determination of the appellant’s application to the High Court for special leave to appeal from a judgment of this Court dated 30 April 2007.

2.Proceedings under the sequestration order made in respect to the appellant’s estate be stayed until the hearing or earlier determination of the appellant’s application for to the High Court for special leave to appeal from a judgment of this Court dated 30 April 2007.

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

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2007] FCA 964
Decision Date: 22 June 2007

CaseChat Overview and Summary

In the case of Murdaca v Accounts Control Management Services Pty Ltd, the Federal Court was asked to consider an application for an injunction to stay a writ of possession and proceedings under a sequestration order. The applicant, Mr Murdaca, sought relief from enforcement of a judgment debt owed to the respondent, Accounts Control Management Services Pty Ltd. The central issue before the court was whether to grant an interlocutory injunction to prevent the execution of the writ of possession and the sequestration proceedings pending the outcome of an appeal to the High Court.

The court considered the balance of convenience, taking into account Mr Murdaca's financial situation, which was limited to a disability pension, a car valued at $300, and an interest in his home, subject to a mortgage. The judgment debt, while not insignificant, was considerably less than the equity in his home. The court recognised that if the property were sold, additional costs would be incurred, potentially making it difficult to restore the status quo if Mr Murdaca ultimately succeeded in his appeal to the High Court.

In light of these considerations, the court concluded that it was appropriate to stay the writ of possession and the sequestration proceedings until the determination of Mr Murdaca's application for special leave to appeal to the High Court. The court made an order to that effect, staying the writ of possession and the sequestration proceedings pending the outcome of the High Court appeal.

Orders

Orders of the court

1. The writ of possession directed to the Sheriff of New South Wales dated 31 May 2007 be stayed until the hearing or earlier determination of the appellant’s application to the High Court for special leave to appeal from a judgment of this Court dated 30 April 2007.

2. Proceedings under the sequestration order made in respect to the appellant’s estate be stayed until the hearing or earlier determination of the appellant’s application for to the High Court for special leave to appeal from a judgment of this Court dated 30 April 2007.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

BRANSON J

In considering the balance of convenience I note that the reasons of the Federal Magistrate suggest that Mr Murdaca’s only source of income is a disability pension and that his assets are limited to a car valued at $300 and his interest in his home. His home secures repayment of a mortgage debt. The judgment debt is modest when compared with the equity apparently held by Mr Murdaca in his home. If the property is sold, costs, including agent’s fees and commission and trustee’s remuneration, will be incurred. Should Mr Murdaca ultimately succeed on an appeal to the High Court it may prove impossible for the status quo to be restored.Conclusion In all of the circumstances I am satisfied that it is appropriate for following orders to be made:1.The writ of possession directed to the Sheriff of New South Wales dated 31 May 2007 be stayed until the hearing or earlier determination of the appellant’s application to the High Court for special leave to appeal from a judgment of this Court dated 30 April 2007.2.Proceedings under the sequestration order made in respect to the appellant’s estate be stayed until the hearing or earlier determination of the appellant’s application for to the High Court for special leave to appeal from a judgment of this Court dated 30 April 2007.

Ratio Decidendi

Legal Principle Established

Established by: BRANSON J

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 2268 OF 2006

JUDGE:	BRANSON J
DATE OF ORDER:	22 JUNE 2007
WHERE MADE:	SYDNEY