Oversea Chinese Banking Corp v Yin Wu Nan
[2001] FMCA 133
•27 November 2001
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| OVERSEA CHINESE BANKING CORP v YIN WU NAN | [2001] FMCA 133 |
| BANKRUPTCY – Opposed creditors petition – debtor alleges not “ordinarily resident in Australia” at time of act of bankruptcy – evidence of travel documents and business interests accepted – debtor found to be ordinarily resident – section 43(1) Bankruptcy Act 1966. Re:Taylor ex parte Natwest Australia Bank Limited (1992) 37 FCR 194 |
| Applicant: | OVERSEA CHINESE BANKING CORPORATION |
| Respondent: | YIN WU NAN |
| File No: | BZ 140 of 2001 |
| Delivered on: | 27 November 2001 |
| Delivered at: | Brisbane |
| Hearing Date: | 27 November 2001 |
| Judgment of: | Baumann FM |
REPRESENTATION
| Counsel for the Applicant: | John Davies |
| Solicitors for the Applicant: | Gadens |
| Counsel for the Respondent: | P A Kronberg |
| Solicitors for the Respondent: | Sciacca’s |
ORDERS
Pursuant to section 33(1) of the Bankruptcy Act 1966, leave is given to the Applicant to amend the petition filed 26 March 2001 to include at paragraph (3), an allegation that at the time when the Act of Bankruptcy was committed the Debtor was carrying on business in Australia either personally or by means of an agent or manager.
I make a sequestration order against the Estate of the Debtor YIN WU NAN.
I order that the Applicant’s costs, including reserved costs, be taxed and paid from the Estate of the Debtor in accordance with the Bankruptcy Act 1966.
It is noted that the Act of Bankruptcy was committed on 16 March 2001.
Pursuant to Rule 21.15 of the Federal Magistrates Court Rules 2001
I CERTIFY that it was reasonable to employ an advocate (advocates) to appear for the Applicant/Respondent in the proceedings.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
BZ 140 of 2001
| OVERSEA CHINESE BANKING CORPORATION |
Applicant
And
| YIN WU NAN |
Respondent
REASONS FOR JUDGMENT
Introduction
This is a contested creditor's petition filed on 26 March 2001 by OVERSEA CHINESE BANKING CORPORATION LIMITED, who I shall call the “creditor”, against Mr YIN WU NAN, who I shall call the “debtor”. The debtor opposes the petition on the basis of there being no jurisdiction under Section 43(1) of the Bankruptcy Act 1966.
Issue
The debtor abandoned opposition of the petition on the basis of solvency and offered no evidence in that regard. The creditor, through its counsel, primarily asserts the Court has jurisdiction because at the time the Act of Bankruptcy was committed (acknowledged by both parties to be 16 March 2001) the debtor "was ordinarily resident in Australia." Secondary submissions relying upon the debtor either (a) having a "dwelling house or place of business in Australia" or (b) "carrying on business in Australia either personally or by means of an agent or manager" were also made.
Preliminary issues
The applicant had given notice to the respondent and had, by notice of motion, filed 10 September 2001, sought leave to amend paragraph 3 of the petition to include at paragraph 3 an allegation that the debtor was carrying on business in Australia. I indicated I would give leave, no prejudice having been established by the debtor. Secondly, the debtor sought to rely upon his affidavit sworn in Beijing on 9 November 2001 and filed on 21 November 2001. Although the affidavit did not raise any new issues, not previously identified, the affidavit was not delivered within the time limits imposed in my earlier order and further does not contain a certification of a translation required by Rule 15.27(2) of the Federal Magistrates Court's Rules.
I indicated that, subject to the document being re-sworn today and duly certified, I would allow the debtor to rely upon it. These reasons are based on that evidence being received.
The background
The bankruptcy notice, which issued on 27 October 2000, was founded on the judgment obtained by the creditor against the debtor in the High Court of Singapore on 30 December 1998, and, subsequently, registered in the Supreme Court of Queensland by order of Douglas J made 1 September 2000. Orders for substituted service of the bankruptcy notice were made by this Court and the deemed service of the notice took place on 23 February 2001 with non-compliance resulting in the Act of Bankruptcy occurring on
16 March 2001. The petition issued on 26 March 2001, and after some delays, principally relating to the debtor's hospitalisation in China, the matter was listed for hearing today before me.
The seminal issue is was the debtor ordinarily resident in Australia at the date of the act of bankruptcy? In respect of this issue the applicant says:
(a)The debtor, an Australian citizen, was on the relevant electoral roll both before and after the relevant date.
(b)The debtor has held, and still holds, positions as a director and/or secretary of a "impressive" number of companies at which the Raby Bay address is shown as the registered office. In respect of eight such companies the debtor is the only director with an Australian address. The Corporations Act provides directors to advise of their "usual residential address" (Section 205D of the Act) and under Section 201A of the Corporations Act there must be at least one director who ordinarily resides in Australia.
(c)The search of the real estate registries in Queensland and the Motor Vehicle Registry reveal ownership either solely or jointly of three motor vehicles and four separate parcels of real estate. In respect of the real estate, the creditor says 32 Raby Bay Boulevard, Cleveland, is a dwelling currently occupied by the debtor's wife and their two infant children. The debtor says he separated from his wife on 9 March 2001 (one week before the alleged Act of Bankruptcy).
(d)The debtor advised authorities that when leaving Australia on
10 March 2001 (for 30 days), and, again, on 14 June 2001 (for three months) and further on 10 October 2001 (for 7 days) that he:(i) was an Australian resident departing temporarily;
(ii) that he lives in Queensland;
(iii) that his main reason for his overseas travel was business.
These declarations are said to have been made and the contents are said to be "true, correct and complete."
In response, the debtor says:
(a)He migrated in May 1996, became an Australian citizen in 1999 and separated from his second wife "and left the former matrimonial home at 32 Raby Bay Boulevard, Raby Bay" on or about 9 March 2001. Two infant children of that marriage, aged almost 2 and 5, continue to live with their mother in that home at this time.
(b)He considers his principal place of residence as an apartment owned by his parents and brother since 1996 located in Beijing, China.
(c)Whilst he has substantial financial interests in South-East Asia (particularly Singapore, Cambodia and China) he says only two of the companies in which he is a director in Australia actually trades identifying:
(i) Queensland International, Economic and Technical Exchange Co Pty Ltd — a company he says acts as a consultant to Chinese people who wish to invest outside of China including Australia;
(ii) Australian Yong Sheng Pty Ltd in which he holds a 25 per cent shareholding, the company being set up so that "associates" could invest in Australia. The company is also engaged in Australia in the exporting of sheep skins from Brisbane.
(d)Although not separating from his wife until March 2001, he says the Raby Bay property was initially used for "office facilities and accommodation for Chinese guests, “and has been since 1999 used by his wife and children and rarely by me since my relations with my second wife were not good then."
(e)He says he has only been in Australia, since 11 May 1996, for a total of 462 days or about 23 per cent of the time and that since January 2000 he has spent only 175 days in Australia.
(f)He says there is no evidence saying he drives the motor vehicles which are registered in his name.
(g)Whatever might be his responsibilities to the Australian Securities Investment Commission, under Corporations Law, his mere directorship of companies does not mean “ordinary residence”;
(h)asserts that I should not make an inference against the debtor for the manner in which he completed the departure card, preferring the direct evidence of the debtor coupled with adopting a plain sense interpretation that the debtor, (unskilled in English), merely completed Section E because it's heading —“Australian Resident Departing Temporarily” is more appropriate than Sections D or F.
Conclusion
The debtor was not required for cross-examination. As a result, I am entitled to accept his evidence as unchallenged. Having said this, his mere assertion that he regards his parent's apartment in Beijing to be his permanent residence is not enough.
I refer to the remarks of Lockhart J in re Taylor ex parte Natwest Australia Bank Limited (1992) 37 FCR 194, which I'll include in these written reasons, which refers to the fact that the terms "residence" and "ordinarily resident" are not matters of art but should be given their natural meaning.
The debtor now an Australian citizen clearly has on the evidence spent much of his time since migrating to Australia in 1996 in Australia as well as South East Asia and China. His personal business interests would require that as well in his work as a consultant promoting Chinese business to invest in places outside of China including Australia.
He acknowledges he has used his permanent residential status to enable investment in Australia for foreign interests either as a resident director of a variety of companies or for what he says are the interests he claims to hold as trustee for other non-residents in 40 Anchorage Drive, Cleveland and 27 Passage Street Cleveland. The number of days spent in Australia is not determinative of the issue. That is but one part of the evidence. Considering the nature of the debtor's work and in the absence of any evidence that he in fact spent the balance of time in predominantly one other location, I am entitled to infer that the time in Australia is not less than time spent in any other particular country such as China, Singapore or Cambodia where he has business interests.
There is no evidence that he owns any other dwelling in another country although I accept home ownership in China appears not to be a particular part of their culture (see paragraph 4 of the debtor's affidavit). The debtor promoted, if not sponsored, the migration of his second wife and young family to Australia in 1997 although he says relations with his wife "were not good". I am, I believe, entitled to infer that the relationship continued as a marital relationship in Australia until he says he separated on 9 March 2001. In those circumstances combined with the other indicia of permanency in Australia set out above, I am satisfied that the debtor was ordinarily resident in Australia at 9 March 2001.
Of course, for the founding of the jurisdiction, it is necessary for me under this limb of section 43(1) of the Bankruptcy Act 1966 to find the debtor was ordinarily resident at 16 March 2001. I might have expected the debtor to adduce some evidence of the change in his residential status arising from the breakdown of his marriage. Such was not led. I attribute some significance to his statement of separation having occurred on 9 March 2001 — that denotes an event of some significance in my view. Generally a breakdown of a relationship can be reflected in the change of circumstances.
However, the day after separation occurs (on 10 March 2001), the debtor completed an outgoing passenger card declaring he was an Australian resident departing temporarily. He appears to have returned on 21 May 2001, remain for a further 24 days before departing on 14 June 2001 again making a similar declaration of temporary departure. Importantly in an entry card dated 21 May 2001, the debtor declared his intended address in Australia as
32 Raby Bay Boulevard and described himself in item C as a resident returning to Australia.
I am able to interpret this form, being an annexure to the affidavit of Heather Maria Thomson filed 23 November 2001, by comparing the form dated 21 May 2001 (which is in Chinese) with the form dated
30 September 2001 which is in English. The significance of the inferences capable of being drawn from the incoming and outgoing passenger cards was recognised by the Full Court in Taylor v Natwest Australia Bank Limited (1992) 37 FCR 194 and by Olney J in Ginane ex parte Diners Club Limited No VP240 of 1992 FE.
Whilst I agree with counsel for the debtor that his client's self descriptions on the immigration card should not be treated as necessarily conclusive, they do in my view constitute some evidence that he regarded Australia as his place of ordinary residence. I do not accept the submission of the debtor's counsel that I should accept the debtor has not been able to properly distinguish the differences in items D, E and F on the departure card.
In any event, the incoming card of 21 May 2001 is in Chinese. Having been satisfied he was ordinarily resident in Australia at 9 March 2001, I am satisfied he continued to fit that description at least until 21 May 2001. As a result, the available evidence is of sufficient weight to justify this Court drawing the inference that at the relevant time of
16 March 2001 the debtor was ordinarily resident in Australia. Because of the finding, it is not necessary for me to consider the other limbs of section 43(1) of the Act relied upon by the creditor. The creditor has proved all the facts upon which it relies in the petition. There will be an order that the debtor's estate be sequestrated and the formal order will be as set out at the beginning of these reasons.:
I certify that the preceding seventeen (17) paragraphs are a true copy of the reasons for judgment of Baumann FM
Associate:
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