Nomchong v The Owners - Strata Plan No.6766 - [2018] FCCA 3385

FEDERAL CIRCUIT COURT OF AUSTRALIA

NOMCHONG v THE OWNERS - STRATA PLAN NO.6766

[2018] FCCA 3385

Catchwords:
BANKRUPTCY – Application for review of Registrar’s decision dismissing application to set aside bankruptcy notice – whether there are substantial reasons for questioning whether judgment on the basis of which bankruptcy notice has been issued in truth represents a debt – whether applicant has counter-claim, set-off or cross demand against creditor equal to or exceeding the amount of the judgment debt on the basis of which the bankruptcy notice has been issued – application for review dismissed.

Legislation:

Bankruptcy Act 1966 (Cth), ss.30, 40, 41(6A)
Civil and Administrative Tribunal Act 2013 (NSW) s.77
Federal Circuit Court of Australia Act 1999 (Cth) s.104(2)
Legal Profession Uniform Law Application Act 2014 (NSW) ss.70, 71, 78
Strata Schemes Management Act 1996 (NSW) ss.138, 203

Cases cited:

Conlan v Mladenis [2007] FCA 1129
Glew v Harrowell, in the matter of Glew [2003] FCA 373
Olivieri v Stafford (1989) 91 ALR 91
Ramsay Health Care Australia Pty Ltd v Compton [2017] HCA 28
Re Brink; Ex parte The Commercial Banking Company of Sydney Ltd [1980] FCA 78; (1980) 44 FLR 135
Re Sterling; Ex parte Esanda Ltd (1980) 44 FLR 125
Williams v Spautz (1992) 174 CLR 509
Wren v Mahony [1972] HCA 5; (1972) 126 CLR 212

Applicant:

GREGORY NOMCHONG

Respondent:

THE OWNERS - STRATA PLAN NO. 6766

File Number:

SYG 1547 of 2018

Judgment of:

Judge Manousaridis

Hearing date:

5 September 2018

Date of Last Submission:

19 November 2018

Delivered at:

Sydney

Delivered on:

23 November 2018

REPRESENTATION

Applicant, in person

Counsel for the Respondent:

Mr M Rose

Solicitors for the Respondent:

Bannermans Lawyers

ORDERS

The application filed by the applicant on 13 August 2018 for review of the orders made by a Registrar on 24 July 2018 dismissing an application to set aside Bankruptcy Notice No. BN222218 issued on 6 March 2018 and ordering the applicant to pay the respondent’s costs is dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 1547 of 2018

GREGORY NOMCHONG

Applicant

And

THE OWNERS STRATA PLAN NO. 6766-

Respondent

REASONS FOR JUDGMENT

Introduction

The applicant, Mr Nomchong, applies for review of a decision made by a Registrar of this Court on 24 July 2018 dismissing an application Mr Nomchong filed to set aside a bankruptcy notice that was issued at the request of the respondent, The Owners - Strata Plan No.6766 (SP6766). The bankruptcy notice was issued on 6 March 2018 and served on Mr Nomchong on 15 May 2018.
The bankruptcy notice demands payment of $28,082.38. That amount is the sum of the following amounts:
a)The first is $20,978.69, being the amount of a judgment that was entered by the Local Court of New South Wales on 2 March 2018 in favour of SP6766 against Mr Nomchong. That amount, in turn, is the sum of two costs determinations made under the Legal Profession Uniform Law Application Act 2014 (NSW) (LP Act);…

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: [2018] FCCA 3385
Decision Date: 23 November 2018

CaseChat Overview and Summary

The applicant, Nomchong, sought a review of the Registrar's decision to dismiss an application to set aside a bankruptcy notice. The respondent was The Owners - Strata Plan No.6766. The dispute concerned whether the applicant had substantial reasons to question the validity of the judgment debt upon which the bankruptcy notice was founded, or whether the applicant possessed a counter-claim, set-off, or cross-demand against the judgment creditor that was equal to or exceeded the amount of the judgment debt.

The primary legal issues before the court were whether the applicant had demonstrated substantial reasons for questioning the judgment debt, and whether the applicant had a counter-claim, set-off, or cross-demand sufficient to meet the threshold for setting aside the bankruptcy notice. These issues required the court to consider the nature and strength of the applicant's asserted grounds for challenging the debt and the existence and quantum of any alleged counter-claims.

Judge Manousaridis dismissed the application for review. The court found that the applicant had failed to establish substantial reasons for questioning the judgment debt or to demonstrate a counter-claim, set-off, or cross-demand that equalled or exceeded the amount of the judgment debt. Consequently, the Registrar's decision to dismiss the application to set aside the bankruptcy notice was upheld.

Orders