Official Trustee in Bankruptcy v Mahmoud

[2007] NSWSC 73

CITATION:	Official Trustee in Bankruptcy v Mahmoud [2007] NSWSC 73
HEARING DATE(S):	12 February 2007
JUDGMENT DATE :	14 February 2007
JURISDICTION:	15839/05
JUDGMENT OF:	Studdert J
DECISION:	1. The notice of motion filed on 12 February 2007 is dismissed. 2. Order that execution of the writ for possession of the premises be stayed until 10.00 am on 2 March 2007.
LEGISLATION CITED:	Bankruptcy Act Uniform Civil Procedure Rules
CASES CITED:	Mahmoud v The Owners Corporation Strata Plan No. 811 (No. 3) [2006] FMCA 1742 The Official Trustee in Bankruptcy v Mahmoud [2006] NSWSC 1194 The Official Trustee in Bankruptcy v Mahmoud [2007] NSWSC 3
PARTIES:	The Official Trustee in Bankruptcy (Plaintiff/Respondent) Tosson Hussein Mahmoud (Defendant/Applicant)
FILE NUMBER(S):	SC 15839/05
COUNSEL:	M. Mantaj (Plaintiff/Respondent) In person (Defendant/Applicant)
SOLICITORS:	Sally Nash & Co. (Plaintiff/Respondent) N/A (Defendant/Applicant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

STUDDERT J

Wednesday 14 February 2007

15839/05 THE OFFICIAL TRUSTEE IN BANKRUPTCY v TOSSON HUSSEIN MAHMOUD

JUDGMENT

1 HIS HONOUR: The applicant, Tosson Mahmoud, has applied to the Court by way of notice of motion for the following orders:

“1. An order that the notice to vacate on 16-02-07 issued by the Sheriff and its execution, a copy of which is annexed to the affidavit and marked annex A, and the whole proceedings before the Supreme Court be stayed until the finalization of the proceedings at the Federal Magistrates Court, at the Federal Court and at the High Court in regard to the application to annul the sequestration order which was made by the Registrar of the Federal Magistrates Court on 23-05-2005.
2. In the alternative an order to a stay of two months is requested given the annexed medical certificates to the affidavit of the applicant.
3. A ruling that it is a torture to the Claimant to keep him engaged in the Supreme Court, the Court of Appeal and later on the High Court while he is already engaged in the Federal Magistrates Court, the Federal Court and the intended appeal to the High Court given the very severe trauma the Claimant is suffering and the medical certificates he has as shown in details in the documents in the files of all the cases before all the Courts stated above.”

2 The notice to vacate which is referred to in the notice of motion is a notice to vacate premises described as Unit 16, 417 Liverpool Road, Ashfield. Those premises are the applicant’s home. (I shall refer to them as “the subject premises”.)

3 On 14 November 2006 Rothman J ordered judgment for the Official Trustee in Bankruptcy for possession of the subject premises and granted leave for the issue of a writ for possession. A writ for possession was issued on 4 December 2006 and the notice which prompted the present application followed on the issue of the writ.

4 Before considering the basis of the present application, it is appropriate to record shortly the history of proceedings in the Federal Magistrates Court and in this court.

5 A sequestration order was made against the estate of the applicant on 23 May 2005. By reason of the operation of s 58 of the Bankruptcy Act, upon the applicant becoming a bankrupt, his property vested in the Official Trustee, and that property, of course, included the subject premises to which the notice to vacate relates.

6 The applicant remains an undischarged bankrupt.

7 In proceedings in the Federal Magistrates Court the applicant applied unsuccessfully to have the sequestration order annulled. The application for annulment was determined by judgment delivered on 15 December 2006: Mahmoud v The Owners Corporation Strata Plan No. 811 (No. 3) [2006] FMCA 1742. The reasons for judgment delivered by Mr Lucev FM were expressed as follows:

“56 The Applicant has tendered no admissible evidence in support of the Application. There is nothing before me to indicate that the sequestration order was not bound to be made. The Application must therefore be dismissed.
57 In any event, the Court exercises its discretion not to annul the sequestration order, for the following reasons
a) the Applicant has not filed a Statement of Affairs, and it is therefore not possible to know precisely who his creditors might be;
b) because the Applicant has not filed a Statement of Affairs it is not possible to determine whether he has unencumbered assets sufficient to meet the debts to creditors, including possibly unknown creditors;
c) that, notwithstanding the provisions of the Bankruptcy Act relating to the powers and duties of Official Trustee (including ss 18, 19, 109, 129(1), 134, 135, 140, 145, 156A, 165, 173 and 174), the Applicant continues to refuse to recognise the ‘existence’ of the Official Trustee or the role of the Official Trustee, and refuses to assist the Official Trustee;
d) the almost one year delay in making the annulment application; and
e) the Applicant has neither given or offered undertakings of any kind.”

8 In his application before this Court, the applicant expressed an intention to appeal against the magistrate’s decision.

The proceedings in the Supreme Court

9 The Official Trustee in Bankruptcy began proceedings in this court by way of statement of claim on 12 December 2005 seeking recovery of possession of the subject premises. The applicant resisted that claim and filed a defence which Rothman J determined raised no issue such as would disentitle the plaintiff to possession whilst the bankruptcy was on foot: see the judgment of Rothman J of 2 August 2006 The Official Trustee in Bankruptcy v Mahmoud [2006] NSWSC 1194 [4]. Rothman J determined that the defence should be struck out, and made an order accordingly. His Honour further determined that the plaintiff was entitled to default judgment (see the same judgment at [15]-[16]). Hence his Honour determined that judgment should be entered for the Official Trustee, and that judgment remains on foot.

10 Following the issue of a writ for possession on 4 December 2006, the applicant was given an earlier notice to vacate. That notice to vacate bore date 18 December 2006 and required vacation of the premises no later than midday on 9 January 2007.

11 Following upon the service of that earlier notice, the applicant applied to this court by notice of motion seeking an order that the writ for possession and its execution and the notice to vacate be stayed.

12 That earlier application came before Hall J on 9 January 2007. His Honour reserved his decision, and on 12 January 2007 dismissed the application: see The Official Trustee in Bankruptcy v Mahmoud [2007] NSWSC 3. I observe that the present application is of a like nature to the one refused by Hall J, albeit that it relates to a different notice to vacate.

13 This brings me to the present application.

The present application

14 The applicant moves on his affidavit affirmed on 12 February 2007. That affidavit annexes the notice to vacate dated 7 February 2007, two medical certificates from Dr Girgis, and what purports to be a draft affidavit which the applicant intends to rely upon in appealing to the Federal Court from the decision of the Federal Court magistrate earlier mentioned. The applicant states in his affidavit that that affidavit is not yet complete.

15 This applicant of course suffers the disadvantage of being without legal representation, and some allowance has to be made for that. At the conclusion of the hearing on 12 February 2007 I reserved my decision in order to consider closely material relevant to the application.

16 Having reflected upon the matter, I have concluded that the relief sought by the applicant must be refused.

17 No application has yet been made to the Federal Court notwithstanding the date of the magistrate’s judgment in which the magistrate very relevantly referred to the delay which had preceded the making of the application for annulment which he was called upon to consider.

18 Turning to the proceedings in this court, the applicant indicated on this application an intention to appeal from the decision of Rothman J, but there is as yet no appeal in proper form pending in the Court of Appeal. Leave to appeal would be necessary. It seems that some documents have been lodged with the registrar of the Court of Appeal which prompted Registrar Schell to express the following decision on 24 January 2007:

“1. Tosson Mahmoud (the Applicant) has sought the postponement or waiver of the fee for the filing of an ordinary summons for leave to appeal, which purports to challenge judgments given by Rothman J on 2 August 2006 and 14 November 2006.
2. The summons claims by prayers 2. 3. 4. 8, 9, 10 and 11 orders which are inappropriate for consideration in a summons for leave to appeal. In this regard it is noted that the applicant brought a notice of motion in the Common Law Division on 9 January 2007 seeking similar relief to that claimed in prayer 2. That motion was dismissed on 12 January 2007.
3. The summary of argument which is included in the white folder presented by the applicant does not comply with the requirements of Part 51 rule 4B(2)-(3) of the Supreme Court Rules. In particular the applicant has not stated, inter alia, the nature of the claimant’s case, the questions involved, the claimant’s brief arguments or the reasons why leave to appeal should be granted.
4. In my view, the material in present form which the applicant seeks to file would constitute an abuse of the process of the Court (see Uniform Civil Procedure Rules, r.13(4)(1)(c)). The acceptance of such material would expose the applicant to unfavourable costs orders, and compromise the integrity of the Court’s process.
5. The application to postpone or waive the filing fee is refused.”

19 The applicant has not brought to the Court’s attention on the present application any steps taken to address the matters identified by Registrar Schell, and in particular those matters referred to in paras 3 and 4 of the registrar’s decision.

20 I have considered the medical reports from Dr Girgis. I am not persuaded by those reports or by the applicant’s submissions that there is a satisfactory explanation for the delay in pursuing the contemplated appeal processes nor, of course, does the medical evidence account for the earlier delay in seeking to have the sequestration order annulled.

21 There is no appeal properly on foot against the judgment of Rothman J but I have regard to the decision of the Registrar of the Court of Appeal mentioned above, and it is relevant on the present application for me to consider the prospects of success if leave to appeal is sought in relation to the decision of Rothman J. I have regard to my assessment of those prospects in determining the appropriate outcome on the present application.

22 I have seen in the court papers the document described as a defence, which document bears date 18 April 2006. This appears to be the document referred to in Rothman J’s judgment. I respectfully agree with the conclusion reached by Rothman J that that document did not give rise to an issue such as would have disentitled the Official Trustee to the relief sought. Moreover, that pleading offended the Uniform Civil Procedure Rules in many respects.

23 Returning to the proceedings in the Federal Magistrates Court, I do not detect error in the passages from the judgment which I referred to earlier. The plaintiff in his affidavit in support of this notice of motion has included as an annexure a draft of the affidavit he intends to complete and to rely upon in pursuing relief in the Federal Court. The content of that draft affidavit does not persuade me that the magistrate fell into error, and the draft affidavit contains no explanation for the delay in seeking to have the sequestration order annulled.

24 I am not impressed as to the applicant’s appeal prospects either in the Federal Court or the Court of Appeal. The applicant would understand that it is not for me to determine either appeal but it is relevant for this Court to have regard to what it perceives to be the prospects on appeal in determining the appropriate outcome on the present notice of motion.

25 There is no satisfactory evidence before this Court as to the applicant’s financial affairs. The applicant has not filed a statement of affairs notwithstanding the requirements of s 54 of the Bankruptcy Act. On the hearing of the present application the applicant indicated he refused to do so because that would give the bankruptcy a legitimacy which he does not acknowledge. In the absence of any statement of affairs however, there is no evidence presently before me as to the value of the subject premises, and, in any event, since title to them is vested in the Official Trustee this is not a case in which the applicant is in a position to borrow against the security of the property.

26 I observe that there is in para 51 of Mr Lucev’s judgment of 15 December 2006 earlier referred to a detailed reference to a report filed on behalf of the Official Trustee and this discloses details of the applicant’s creditors. The applicant for his part asserted in submissions that those details were not correct. This Court is no better placed than the Federal Magistrates Court was last year to determine whether the applicant has assets sufficient to meet his debts.

27 Having reflected upon what the applicant put before the Court on Monday last and the competing submissions of Mr Mantaj, I have come to the conclusion that the applicant has failed to establish grounds for the making of any of the orders sought in the notice of motion presently under consideration.

28 The applicant has stated in his affidavit that a Sheriff’s Officer, identified as “Violet”, informed him that he would be given one months notice prior to the issue of a notice to vacate. Whether the applicant was so informed or not, I accept that to require the applicant to vacate by 16 February would allow him very little time to make necessary arrangements. I do not lose sight of the fact that the applicant was given the earlier notice that prompted the application to Hall J but nevertheless I propose to extend the period for vacation of the premises for a further two weeks from the date set in the notice to vacate.

Formal orders

29 1. The notice of motion filed on 12 February 2007 is dismissed.

2. Order that execution of the writ for possession of the premises be stayed until 10.00 am on 2 March 2007.

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