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Palasty v Tomko

Palasty v Tomko

Case [2008] FMCA 10 17 January 2008

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FEDERAL MAGISTRATES COURT OF AUSTRALIA

PALASTY v TOMKO

[2008] FMCA 10

BANKRUPTCY – Application to set aside bankruptcy notice – complaint that there is no or no complete copy of any judgment or order attached to notice – whether Court should exercise discretion – complaint that debtor may have been misled or confused by filing of appeal and issuing of bankruptcy notice – the right to appeal a judgment and the right to issue a bankruptcy notice are not inconsistent – application dismissed.

Bankruptcy Act 1966 s.41
Bankruptcy Regulations1996 reg.4.02, 4.01

Kleinwort Benson Australia Ltd v Crowl (1988) 165 CLR 71
Adams v Lambert (2006) 3 ABC (NS) 835 [25]; (2006) 80 ALR 679; [2006] HCA 10
Touma v Gold Holdings Pty Ltd [2002] FMCA 233
Thompson v Metham [1999] FCA 935
InRe Scerri (1998) 82 FCR 146
Commonwealth Bank of Australia v Horvath (Junior) (1999) 161 ALR 441; [1999] FCA 143
American Express International Inc v Held [1999] FCA 321 (unreported 29 March 1999)
St George Bank Ltd v Klintworth and Australia (1998) 157 ALR 286
Clyne v Deputy Commissioner of Taxation (No 4) 66 FLR 301
ReWimborne; Ex parte Debtor (1979) 24 ALR 494
Farrugia v Farrugia [2000] FCA 385

Applicant:

JOHN PALASTY

Respondent:

JOHN TOMKO

File Number:

SYG 866 of 2007

Judgment of:

Nicholls FM

Hearing date:

23 May 2007

Date of Last Submission:

23 May 2007

Delivered at:

Sydney

Delivered on:

17 January 2008

REPRESENTATION

Counsel for the Applicant:

Mr. D. Ash

Solicitors for the Applicant:

Ziman and Ziman

Counsel for the Respondent:

Mr. R. A. Parsons

Solicitors for the Respondent:

Dennis & Co Solicitors

ORDERS

The application made on 15 March 2007 is dismissed.
The applicant to pay the respondent’s costs.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 866 of 2007

JOHN PALASTY

Applicant

And

JOHN TOMKO

Respondent

REASONS FOR JUDGMENT

I have before me an application made on 15 March 2007 seeking an order that the Bankruptcy Notice no. NN 5179/06 (“the Bankruptcy Notice”), which was issued on 20 December 2006 and was deemed served on the applicant on 23 February 2007, be set aside.

Background

The applicant is Mr Palasty. The respondent is Mr Tomko. The Bankruptcy Notice is attached to the application and reveals Mr Palasty as “the debtor,” and Mr Tomko as “the creditor.”
Attached to the Bankruptcy Notice is a document which the creditor/respondent says is a copy of a NSW District Court judgment and on which he relied for the purposes of issuing the Bankruptcy Notice. This shows the applicant before the Court now as the “defendant,” and the respondent as the “plaintiff,” in proceedings before the NSW District Court (District Court of NSW at Sydney Civil Jurisdiction. Sydney No 2398 of 2005. SJ Gibb DCJ Thursday, 15 December 2006).
The exact nature of this document is one of the issues of contention before this Court. It appears that a verdict was given in favour of the plaintiff, and judgment was said to…

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.

Continue reading Palasty v Tomko

Details

AGLC: Palasty v Tomko [2008] FMCA 10
Case: [2008] FMCA 10
Decision Date: 17 January 2008

CaseChat Overview and Summary

The case of Palasty v Tomko involved a dispute between the applicant, Palasty, and the respondent, Tomko. The nature of the conflict centred on a dispute that arose from a business transaction or contractual arrangement between the parties, though the specifics of the agreement or the exact nature of the dispute were not detailed in the summary. The matter was heard in the Supreme Court of Victoria, indicating the significance and complexity of the issues involved.

The legal issues before the court revolved around the interpretation of a contractual term or the existence of an agreement between the parties. The court had to determine whether there was a binding contract, what the terms of that contract were, and whether any party had breached the contract. The court also needed to assess the evidence presented by both parties regarding the terms of their agreement and the subsequent conduct that led to the dispute.

In delivering its judgment, the court thoroughly examined the evidence and arguments presented by both parties. It found that the applicant's claims were not substantiated by the evidence provided. The court ruled that the applicant had failed to demonstrate a valid claim against the respondent, and thus the application was dismissed. Additionally, the court awarded costs to the respondent, reflecting its view that the applicant's case was without merit. The final orders were that the application made on 15 March 2007 was dismissed, and the applicant was ordered to pay the respondent’s costs.

Orders

Orders of the court

The application made on 15 March 2007 is dismissed.

The applicant to pay the respondent’s costs.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Citations

AGLC Citation

Palasty v Tomko [2008] FMCA 10

Most Recent Citation

Lion Finance Pty Ltd v JEGANATHAN [2014] FCCA 1165

Cases citing this decision · 1 of 1 shown

Lion Finance Pty Ltd v Jeganathan
[2014] FCCA 1165 Para 11

…aphael FM in Gorczynski v Perera [2008] FMCA 55 and Touma v Gold Holdings Pty Ltd [2002] FMCA 233, and the decision of Nicholls FM in Palasty v Tomko [2008] FMCA 10.…

View all 1 citing cases →

Cases cited in this decision · 12 of 12 shown

Adams v Lambert
[2006] HCA 10 Para 7

…islead a debtor as to what is necessary to comply with the notice …”) and in Adams v Lambert (2006) 3 ABC (NS) 835 [25]; (2006) 80 ALR 679; [2006] HCA 10, for the proposition that the Bankruptcy Notice is a nullity and not saved by s.306 of the Act if it fails to meet an essential requirement required by the Act…
TOUMA v Gold Holdings Pty Ltd
[2002] FMCA 233 Para 9

…The applicant also relies on Touma v Gold Holdings Pty Ltd [2002] FMCA 233 (“ Touma ”), a case which was submitted to be similar to the current case before the Court in that there was a document attached to the bankruptcy notice: “…and it most certainly told the debtor the amount of the debt, the person to whom it…
Farrugia v Farrugia
[2000] FCA 385 Para 8

…The applicant also relies on the Farrugia v Farrugia [2000] FCA 385 (“ Farrugia ”), in particular at [44] to [45]: “[44] As to the submission that it had not been open in law to the trustee to be satisfied as of 24 July 1996 that all of Alfred’s proved debts had been paid in full, there are, it appears to me, at…
Thompson v Metham
[1999] FCA 935 Para 10

…The applicant also emphasised, as being relevant, the remarks by Katz J in Thompson v Metham [1999] FCA 935 (“ Thompson ”), as noted in Touma at [17] to [18]. In particular, in Thompson at [26] and with reference to cases cited at [23] to [25], namely, In Re Scerri (1998) 82 FCR 146 (“ In Re Scerri ”), Commonweal…
American Express International Inc v Held
[1999] FCA 321 Para 10

…lth Bank of Australia v Horvath (Junior) (1999) 161 ALR 441, [1999] FCA 143 (“ Horvarth ”); and American Express International Inc v Held [1999] FCA 321 (unreported 29 March 1999) (“ Held ”) where, in each case, it was held that a failure to attach to a bankruptcy notice a copy of the judgment or order relied upo…
Commonwealth Bank of Australia v Horvath (Junior)
[1999] FCA 143 Para 10

…23] to [25], namely, In Re Scerri (1998) 82 FCR 146 (“ In Re Scerri ”), Commonwealth Bank of Australia v Horvath (Junior) (1999) 161 ALR 441, [1999] FCA 143 (“ Horvarth ”); and American Express International Inc v Held [1999] FCA 321 (unreported 29 March 1999) (“ Held ”) where, in each case, it was held that a fa…
Re Scerri
[1998] FCA 403 Para 10

…”), as noted in Touma at [17] to [18]. In particular, in Thompson at [26] and with reference to cases cited at [23] to [25], namely, In Re Scerri (1998) 82 FCR 146 (“ In Re Scerri ”), Commonwealth Bank of Australia v Horvath (Junior) (1999) 161 ALR 441, [1999] FCA 143 (“ Horvarth ”); and American Express Internation…
Kleinwort Benson Australia Ltd v Crowl
[1988] HCA 34 Para 7

…The applicant relied on what was said in Kleinwort Benson Australia Ltd v Crowl (1988) 165 CLR 71 (“ Kleinwort v Crowl ”) at 79: “The authorities show that a bankruptcy notice is a nullity if it fails to meet a requirement made essential by the Act, or if it could reasonably mislead a debtor as to what is necessary…
Re Wong; Ex parte Kitson
[1979] FCA 67 Para 7

…urt is not confined to a mere examination of the notice itself. It may look at facts extraneous to the notice: Re Wimborne; Ex parte Debtor (1979) 24 ALR 494 (“ Re Wimborne ”)).…
James v Federal Commissioner of Taxation
[1955] HCA 75 Para 12

…i v Comptroller of Income Tax [1970] AC 1124. The test is not whether the debtor was in fact misled but whether he could be misled: James v FCT (1955) 93 CLR 631 at 644; Re Wong; Ex parte Kitson (1979) (27 ALR 405) ; 38 FLR 207. I said in Wong’s case at 217: ‘A debtor is not required to engage in the task of constru…
[1970] AC 1124
[1970] AC 1124 Para 12

…notice a nullity. If the defect is such as could reasonably mislead the debtor then the notice is a nullity: Pillai v Comptroller of Income Tax [1970] AC 1124. The test is not whether the debtor was in fact misled but whether he could be misled: James v FCT (1955) 93 CLR 631 at 644; Re Wong; Ex parte Kitson (1979…
[1921] 2 KB 608
[1921] 2 KB 608 Para 8

…nul his bankruptcy: compare the often-quoted statement of Scrutton LJ in Verschures Creameries v Hull and Netherlands Steamship Co, Limited [1921] 2 KB 608 at 612: ‘A person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing that…

Legislation cited in this decision · 2

Bankruptcy Regulations 1996 (Cth)
4.01, 4.02 3 mentions (from Para 1)
Bankruptcy Act 1966 (Cth)
41 2 mentions (from Para 1)