Ogbonna v CTI Logistics Ltd (No 7)

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FEDERAL COURT OF AUSTRALIA

Ogbonna v CTI Logistics Ltd (No 7) [2025] FCA 1125   

Appeal from: CTI Logistics v Ogbonna [2022] FedCFamC2G 781
File number: WAD 218 of 2022
Judgment of: FEUTRILL J
Date of judgment: 12 September 2025
Catchwords:

BANKRUPTCY – appeal from sequestration order made under s 43 of the Bankruptcy Act 1966 (Cth) – judgment debt statute-barred under s 13(1) of the Limitation Act 2005 (WA) – enforcement of debt contingent on grant of leave under s 13(1) of the Civil Judgments Enforcement Act 2004 (WA) – whether judgment debt payable immediately or at a certain future time under s 44(1) of the Act

LIMITATION OF ACTIONS – limitation period for remedies for enforcement of judgment debts – application of s 13(1) of the Limitation Act 2005 (WA) to judgment debt – application of State remedies for enforcement of judgment debt under s 213 the Federal Circuit andFamily Court of Australia Act 2021 (Cth) and r 25.11 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) – application and interpretation of s 12 and s 13(1) of Civil Judgments Enforcement Act 2004 (WA)
Legislation:

Bankruptcy Act 1988 (Cth) ss 5, 9, 40, 43, 44, 47, 52, 82, 118-119A

Federal Circuit and Family Court of Australia Act 2021 (Cth) ss 8, 213

Federal Circuit and Family Court of Australia (Consequential Amendments and Transitional Provisions) Act 2021 (Cth) Sch 5, s 18

Federal Circuit Court of Australia Act 1999 (Cth) s 78

Federal Court of Australia Act 1976 (Cth) ss 37M, 37N, 37AR

Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) Pt 25; r 25.11

Federal Circuit Court Rules 2001 (Cth) Pt 29; r 29.11

Federal Court Rules 2011 (Cth) r 36.75

Civil Judgments Enforcement Act 2004 (WA) Ptt 3, 4; ss 11, 12, 13, 15, 16, 17, 19, 32, 33, 35, 49, 59, 86

Limitation Act 1969 (NSW) s 17

Limitation Act 2005 (WA) ss 3, 13
Cases cited:

Central City Pty Ltd v Montevento Holdings Pty Ltd [2011] WASCA 5

Dennehy v Reasonable Endeavours Pty Ltd [2003] FCAFC 158; 130 FCR 494

J & S Holdings Pty Ltd v NRMA Insurance Ltd (1982) 61 FLR 108

Lowsley v Forbes [1999] 1 AC 329

Main Camp Tea Tree Oil Ltd v Australian Rural Group Ltd [2002] NSWSC 219; 20 ACLC 726

Marriott Industries Pty Ltd v Mercantile Credits Limited; Maesbury Plumbers Pty Ltd (intervener) (1991) 160 LSJS 288

McDonnell & East Ltd v McGregor [1936] HCA 28; 56 CLR 50

Motor Terms Co Pty Ltd v Liberty Insurance Ltd [1967] HCA 9; 116 CLR 177

Ogbonna v CTI Logistics Ltd (No 2) [2015] FCCA 2318

Ogbonna v CTI Logistics Ltd [2016] FCA 239

Ogbonna v CTI Logistics Limited [2021] FCA 1491

Ogbonna v CTI Logistics Limited (No 2) [2022] FCA 75

Ogbonna v CTI Logistics Limited (No 3) [2022] FCA 267

Ogbonna v CTI Logistics Limited (No 4)

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Details
Case
[2025] FCA 1125
Decision Date

CaseChat Overview and Summary

The appeal in Ogbonna v CTI Logistics Ltd (No 7) before the Federal Circuit and Family Court of Australia concerned the validity of a sequestration order made against the appellant, Ogbonna, based on a judgment debt that had become statute-barred under the Limitation Act 2005 (WA). The respondents, CTI Logistics Ltd, argued that the debt was still enforceable, but the appellant contended that because the debt was statute-barred and an enforcement order had not been sought within the required timeframe, the debt was not immediately payable, and thus, the sequestration order was invalid. The central legal issue was whether the judgment debt was 'owing', 'due', and 'payable immediately or at a certain time' as required by s 44(1) of the Bankruptcy Act 1966 (Cth). The court had to interpret the relevant provisions of the Limitation Act 2005 (WA), the Civil Judgments Enforcement Act 2004 (WA), and the Federal Circuit and Family Court of Australia Act 2021 (Cth) to determine the enforceability of the judgment debt.

The court held that despite the judgment debt being a provable debt, it was not payable immediately or at a certain future time as it was contingent upon obtaining leave to enforce under the Civil Judgments Enforcement Act 2004 (WA). The respondents had not sought or been granted such leave, and thus, the debt was not payable in the required sense. Consequently, the court ruled that the respondents were not entitled to present their creditors' petition and obtain a sequestration order under s 43 of the Bankruptcy Act. The court's reasoning was grounded in the interpretation of the relevant statutes, which stipulated that the enforcement of the judgment debt was subject to the limitations and procedures outlined in the Civil Judgments Enforcement Act 2004 (WA) and the Federal Circuit and Family Court of Australia Act 2021 (Cth).

The appeal was allowed, and the sequestration order was set aside. The court reserved several questions for further determination, including whether an order should be made to set aside the sequestration order, any orders relating to the remuneration and expenses of the trustee in bankruptcy, and the costs of the appeal and the proceeding in the Federal Circuit and Family Court of Australia (Division 2). The respondents were directed to serve a copy of these orders on the appellant's trustee in bankruptcy, who was granted leave to appear and make submissions on the reserved questions. Additionally, the parties and the trustee in bankruptcy were required to file a minute of proposed consent orders or minutes of proposed orders with written outlines of submissions and any supporting affidavits by a specified date. The appeal was listed for a further hearing to address the reserved questions.

Orders

Orders of the court

1. The interlocutory application for review of the Registrar’s orders of 19 June 2024 taken to have been made on 12 September 2024 in accordance with paragraph 3 of the orders of 19 September 2024 be dismissed with costs reserved.

2. The appellant have leave to amend his notice of appeal in terms of ground 1 of the amended notice of appeal filed 22 March 2024, the need to file and serve an amended notice of appeal be dispensed with and, otherwise, the remaining paragraphs of the interlocutory application for leave to amend the grounds of appeal filed 22 March 2024 be dismissed with costs reserved.

3. The appeal be allowed.

4. The question of what orders should be made in consequence of allowing the appeal including:

(a) if an order should be made to set aside the sequestration order or if an order should be made annulling the bankruptcy;

(b) any orders relating to the remuneration and expenses of the trustee in bankruptcy in the administration of the estate of the appellant; and

(c) any orders relating to the costs of the appeal and the costs of the proceeding in the Federal Circuit and Family Court of Australia (Division 2),

be reserved.

5. By 19 September 2025 the respondents serve a copy of these orders on the appellant’s trustee in bankruptcy.

6. The appellant’s trustee in bankruptcy have leave to appear and make submissions on the questions reserved in paragraph 4 of these orders.

7. By 3 October 2025, with respect to the costs and questions reserved in paragraphs 1, 2 and 4 of these orders:

(a) the parties and trustee in bankruptcy file a minute of proposed consent orders; or

(b) the appellant, the respondents and the trustee in bankruptcy each file and serve minutes of proposed orders and a written outline of submissions (limited to 3 pages) and any affidavit(s) in support.

8. The appeal be listed on a date to be fixed for further hearing on the questions reserved in paragraphs 1, 2 and 4 of these orders.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The principal issue raised in the appeal is whether the judgment debt upon which the bankruptcy notice and act of bankruptcy was founded was ‘owing’, ‘due’ and ‘payable immediately or at a certain time’ for the purposes of s 44(1) of the Bankruptcy Act at the time of presentation of the respondents’ petition and the hearing of that petition. The issue arises because at those times an action on the judgment debt was statute-barred under s 13(1) of the Limitation Act 2005 (WA) and, under the applicable procedure for enforcement of the judgment debt under s 13(1)(a) of the Civil Judgments Enforcement Act 2004 (WA), as applied by the relevant provisions of the Federal Circuit and Family Court of Australia Act 2021 (Cth) and Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), leave was required before an application for an enforcement order could be made to the Federal Circuit and Family Court of Australia (Division 2). The respondents had not sought or been granted leave to apply for an enforcement order. Thus, at the time of presentation of the creditors’ petition the respondents had no then present right to apply for an enforcement order to extract payment for the judgment debt. For the reasons that follow, although the judgment debt was a ‘provable debt’, it was payable contingently. It was not a debt that was ‘payable immediately or at a certain future time’ and, therefore, the respondents were not entitled to present their creditors’ petition and obtain a sequestration order under s 43 of the Bankruptcy Act.Background The background to the appeal and interlocutory applications that were heard with the appeal require a degree of explanation. On 28 August 2015 a judge of the then Federal Circuit Court made a final order dismissing the appellant’s unlawful discrimination claim in those proceedings against the respondents and ordering him to pay costs of $22,762.00: Ogbonna v CTI Logistics Ltd (No 2) [2015] FCCA 2318. On 11 March 2016 an application to extend the time within which the appellant had to appeal from that order was dismissed: Ogbonna v CTI Logistics Ltd [2016] FCA 239. On 20 July 2016 an application for special leave to appeal to the High Court was dismissed. On 20 July 2016 the appellant commenced defamation proceedings against, amongst others, CTI Logistics in the District Court of Western Australia. On 20 January 2018 those defamation proceedings were dismissed for want of prosecution. On 28 February 2018 the appellant commenced a second suit for defamation against the same parties in the District Court. On 10 May 2019 CTI Logistics requested payment of the judgment debt. It was not paid and on 6 June 2019 a bankruptcy notice was issued. At that time, the judgment debt, including interest, was in the sum of $29,050.63. The appellant applied to this Court to set aside the bankruptcy notice. Thereafter, by successive orders of this Court the time within which the appellant had to comply with that bankruptcy notice was extended. Those extensions were made pending the final resolution of the second defamation proceedings which were alleged, by the appellant, to comprise a counterclaim that exceeded the amount of the judgment debt. The appellant also commenced proceedings in this Court in which he sought orders setting aside the bankruptcy notice.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

Section 213 of the Circuit Court Act 2021 provides:213 Enforcement of judgment…(2)A person in whose favour a judgment of the Federal Circuit and Family Court of Australia (Division 2) is given is entitled to the same remedies for enforcement of the judgment in a State or Territory, by execution or otherwise, as are allowed in like cases by the laws of that State or Territory to persons in whose favour a judgment of the Supreme Court of that State or Territory is given. (3)Subsection (2) has effect subject to the Rules of Court.…Section 78 of the Circuit Court Act 1999 was in materially the same terms. Rule 25.11 of the Circuit Court 2021 Rules provides:25.11Execution generally (1)A party may apply to the Court to issue a writ, order or any other means of enforcement of a judgment or order that can be issued or taken in the Supreme Court of the State or Territory in which the judgment or order was made, as if it were a judgment or order of that Supreme Court.(2)An order made under subrule (1) authorises the Sheriff, when executing the orders of the Court, to act in the same manner as a similar officer of the Supreme Court of the State or Territory in which the order is being executed is entitled to act.(3)A party who wants to enforce an order in more than one State or Territory may adopt the procedures and forms of process of the Supreme Court of the State or Territory in which the judgment or order was made.(Notes excluded.)Rule 29.11 of the Circuit Court 2001 Rules was in materially the same terms. For the purposes of s 213 of the Circuit Court Act 2021, an entitlement ‘to the same remedies for enforcement of the judgment in [Western Australia], by execution or otherwise, as are allowed in like cases by the laws of [Western Australia]’ picks up within that entitlement any limitations on remedies for enforcement that are stipulated in the relevant laws of Western Australia. Likewise, for the purposes of r 25.11 of the Circuit Court Rules 2021 a person may only apply for and an order may only be made for a means of enforcement of a judgment or order that ‘can be issued’ in Western Australia. If a means of enforcement cannot be issued in Western Australia due to a limitation on the right of enforcement in that State it is not a means of enforcement that ‘can be issued’. In Western Australia the remedies for enforcement of a judgment, by execution or otherwise, and the kinds of orders or other means of enforcement of a judgment that can be issued or taken in the Supreme Court are contained in the Enforcements Act. Section 12 of the Enforcements Act provides that an order under that Act to enforce a judgment must not be made if 12 years have elapsed since the judgment took effect. Section 13(1) of the Enforcements Act provides that leave of the court must be obtained before an order may be made under that Act to enforce a judgment if six years have elapsed since the judgment took effect. The interpretation of these provisions as they apply to orders and judgments of the Circuit Court is considered later in these reasons. Debts payable immediately or at a certain future time

Ratio Decidendi

Legal Principle Established

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