Oakman v Reid
[2022] FedCFamC2G 944
Federal Circuit and Family Court of Australia
(DIVISION 2)
Oakman v Reid [2022] FedCFamC2G 944
File number(s): MLG 813 of 2022 Judgment of: JUDGE MANSINI Date of judgment: 14 November 2022 Catchwords: PRACTICE AND PROCEDURE – application for review of Registrar’s decision to make a sequestration order – where application filed some 8 weeks late – leave granted and application allowed. Legislation: Bankruptcy Act 1966 (Cth) s 43.
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 256(1)
Federal Circuit and Family Court of Australia (Division 2) (Bankruptcy) Rules 2021 rr 2.02(3), 7.05.
Division: Division 2 General Federal Law Number of paragraphs: 19 Date of last submission/s: 10 November 2022 Date of hearing: 14 November 2022 Place: Melbourne The Applicant: No appearance Counsel for the Respondent: Mr B Devanny Solicitor for the Respondent: Madgwicks Lawyers ORDERS
MLG 813 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: ROMA OAKMAN
Applicant
AND: CHRISTINA LOUISE REID
Respondent
order made by:
JUDGE MANSINI
DATE OF ORDER:
14 NOVEMBER 2022
THE COURT ORDERS THAT:
1.The Respondent have leave to file an application for review of the decision of Registrar Edwards on 4 August 2022 until and including 18 October 2022.
2.Further hearing of the creditor’s petition on review be adjourned to a mention before her Honour Judge Mansini.
3.This matter be adjourned for hearing at 12.00 pm on 16 November 2022 before her Honour Judge Mansini.
4.Costs be reserved.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
Judge Mansini
THE APPLICATION FOR REVIEW
The principal application before the Court is to review a decision of the Registrar, dated 4 August 2022, to make a sequestration order under s.43 of the Bankruptcy Act 1966 (Cth) (Bankruptcy Act) (Application for Review).
Section 256(1) of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (FCFCOA Act) provides for the review of powers exercised by a Registrar. The Federal Circuit and Family Court of Australia (Division 2) (Bankruptcy) Rules 2021 (Bankruptcy Rules), (r.2.02(3)) provide that such applications for review are to be made within 21 days after the day on which the power to make the order that is to be reviewed was exercised, subject to a direction by the Court or a Judge to the contrary.
The Application for Review was therefore due to be filed by 25 August 2022. The Application for Review was not filed until 18 October 2022.
The Applicant in the review proceedings here, Ms Christina Louise Rand (Ms Rand), being out of time with her Application for Review by some 8 weeks, seeks leave of the Court that her Application for Review be accepted although it was filed late.
For the reasons that follow, the extension of time application is allowed.
Procedural History
On 4 August 2022, Ms Rand was made bankrupt by sequestration order made by Registrar Edwards and pursuant to s.43 of the Bankruptcy Act.
On 18 October 2022, Ms Rand filed this Application for Review, which was listed for hearing at 12.00pm on 14 November 2022. The Applicant filed two affidavits in support of the Application for Review: of herself and of a Mr Joseph Katz.
On 11 November 2022, the Court received an affidavit confirming service that the Petitioner (Ms Oakman) and the Trustee in bankruptcy were served in accordance with r.7.05 of the Bankruptcy Rules.
Also on 11 November 2022, Ms Oakman’s representative notified the Court that it did not oppose the grant of leave to extend the time for the Application for Review to be filed and would not be in attendance at the interlocutory hearing of this question.
The matter proceeded to hearing about the request to extend the time for filing of the Application for Review before the Court as presently constituted at 12.00pm on 14 November 2022.
Ms Rand was represented by Counsel and there were no other appearances on behalf of Ms Oakman or the Trustee in Bankruptcy or otherwise. Being satisfied that the relevant persons were on notice, I was content that the matter proceed on the preliminary question of leave to extend the time for filing.
Leave to extend time for filing
Rule 2.02(3) of the Bankruptcy Rules proscribes that an application for review of the exercise of a power of the Court by a Registrar under ss.256(1) of the FCFCOA Act must be made by filing an application within 21 days after the day on which the power was exercised. That rule is expressly subject to any direction by the Court or a Judge to the contrary.
The preliminary issue in this matter is Ms Rand’s request that the Court exercise its discretion and essentially make a direction to the contrary as contemplated by r.2.02(3) so that her Application for Review be allowed to proceed although it was filed late.
The affidavit materials filed in support of the Application for Review included an explanation for the delay in filing as follows: Ms Rand had a ‘white knight’ benefactor who offered and has provided resources to Ms Rand’s solicitors to discharge all debts and costs. From 4 August 2022 until late October 2022, there were various difficulties experienced in engaging in communication with the benefactor and securing its commitment on terms and conditions that would enable this Application for Review to be made. That is also contended as a prejudicial factor on account of which an adjournment of the proceeding before the Registrar was not sought.
No party or other person opposed the request for such leave.
Ms Rand acknowledged that the Court ought be loathe to interfere with the delegated exercise of the discretion to make a sequestration order due to the risk of interference with third party creditors. However, she contended that as all of Ms Rand’s creditors will be discharged by her benefactor this does not arise as a relevant consideration in the present matter.
Regarding the interest of the Trustee to exercise its statutory function, Ms Rand contended that no prejudice would be occasioned in this respect if an extension of time for filing were allowed.
To the contrary, Ms Rand’s submission was that the only prejudice to the creditors and Trustee would arise if the extension is not granted, as the benefactor’s generosity would not be available to creditors generally in a bankruptcy and Ms Rand’s bankrupt estate is highly unlikely to precipitate any funds for the creditors.
I accept the discretion available to the Court under r.2.02(3) ought not be exercised lightly. In the particular circumstances of this case, weighing all the relevant considerations before the Court, I am satisfied this is an appropriate case in which to exercise the discretion to allow leave for the Application for Review to proceed although it was filed outside the prescribed timeframe at r.2.02(3) of the Bankruptcy Rules. I will hear the parties on the substantive application and as to costs. I will order accordingly.
I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Mansini. Associate:
Dated: 14 November 2022
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