Petruk, Re A.R. Ex Parte Official Trustee in Bankruptcy

p a r t e : THE OFFICIAL TRUSTEE I N BkNKRUFTCY

Applicant

and

ELIZABETH W I A FETRUK

Respondent

Smlthers, J.

2 aprll, 1386

Melbourne

Reasons for .Sudqment

There is berore

me thls day

application t o the i o u r t

behalf

the c j f i l c l a l

T r u s t e e

I n

B m k r u p t c y

I n

the State or

VictorLa as t r u s t e e

the

es ta te of Andy

Rolf Anthony

Petruk,

a l s o known as Andy Rolt Anthony Bates,

as t r u s t e e of

the estate of

t h a t

bankrupt

[ o r

t h e r ~ l l o w l n g order?:

fo r

punl.ihment,

o r

the

respondent ,

E l rzabe th

Marla

Fctruk.

r o r the contempt 01

c o u r t ,

I n

that she d ld on

May

1385

r e f u s e

t o

answer the question, "How

many

windsurrers

does your husband

o%n:"

when

d i r cc t cd by

the

Co1urt

t o d o

so;

2 .

For

o rder

that

the

respondent

pay

the

a p p l i c a n t

c o s t s

or'

khls

a p p l l c a t l o n .

'&en th13 application was ca l led on, the

respondent ,

Mrs

Petruk,

lmmcdlately

addressed the c o u r t . Indicating that there gas

some reason why I personal ly

should

no t hear

t h l s

case;

secondly,

t h a t there was a reason wh:J

Judge or the Court

should

hear

t he

case

Inasmuch

as, a s I underEtood ~ t ,

t h e r e had been a break

down

i n

t h e

c o n t i n u i t y

t h e

l i t i g a t i o n

I n

r ; r s p e c t

%he

cause

ac t lon brought

before me

today.

The respondent

showed

s i g n s

or depar t ing

r rom

the

Court

un le s s

was

p r e p a r e d

f o r t h w i t h

a c c e p t

her

submlsslons.

Accordlngly, I

mformed

Mrs Pet ruk

t ha t ,

a l though she

was

a t

l i b e r t y

t o

l e a v e

the

Court

whenever

she

f e l t

i n c l m e d .

her

d e p a r t u r e would

not

brmg the procecdlngs before

t o an end, and

even ~f she

Lert

the c o u r t ,

would

nccessa ry t o r

t o

p r o c e e d

t o

a s c e r t a m

w h e t h e r

should hear

the casc

a n d , i f

thought

should,

t o proceed w l t h i t t o a conclus lon .

At.ter Mrs Pet ruk had spoken at

some l cnq th abou t

t h e

matter,

l n d l c a t e d t o h e r

that

was

desirable

that .

u n l c s s

she had

to say, I

should hear counse

t o r the applicmt

She did have

more to oa:~ and, in saying it. dcwloped a state o t stress and was

reduced t o

Tome tears

and, inricpd. encouraaed by her husband,

ultimately Lett the court protcsting that justice	in effect	was
hard to 43btaln.

M e n Mrs Petruk had left,

I heard counsel t o r the applicant.

who outlined the course of the prOCCedlng5 in this matter,

which

went back well before May 1385.

The matter or the contempt arose

gut of

procecdlngs before the Deputy

Rcglstrar

In Bankruptcy,

which came on before hlm on

6 May IrHS, durlng the course

of which

Mrs Petruk, belng in

the course gf examlnation pursuant to section

H 1 of the Bankruptcy	Act 1966, refused to answer a certaln
questlon.

Con3equcnt upon that,

the Reglstrar, as he was authorized to

do under sectlon

81, made an order that the cxammatlon of

Elizabeth Mans Petruk under sectlon H1

of the Act be adjourned

f o r hearlng before

the Court at, l d . 1 5 am

on I

May 1985.

That

order was made on

7 May 1385.

There was available to hear it a

Judge o t this Court,

Mr Justlce Woodward, who forthwith commenced

the hearing of the examlnatlon.

In the course of the examlnatlon, hls Honour said to

Mr and

Mrs Petrruk, who were both present, that he wanted to say	someth~ng
to them and said:

"I want to be sure that you understand what

I am sayinq,

so if you have any doubt ask Mr McCauliffe. You	can
Interrupt me. Perhaps he should stand between you."

Mrs P e t r u k mid;

"In thc mlddlc".

H I S

Honour rcplled:

"Yes, In the mlddlc.

I Want you to understand that

person who reruses

to answer questions In

a case such

thls, whether

the bankrupt person hlmself or

another person havlng

knowledge of the clrcumstances,

m the case

of Mrs

Petruk, can be rcqulred to answer

quest-Ions by the Court and

li they refuse

to answer that

person can be commltted to prlson	f o r contempt of	court
until they agree to answer."

It 3eem3 that

hls Honour contlnued:

"Now, the pomt I want

to make clcar i s that to

refuse

to answer

a questlon In the Court

1 s

a very

scrious

thlng to do, and you

can flnlsh In prlson as

a result.

Now that, I

have explamerl that to you, I want to

glve

vou each another chance

to answer the questlons that,

&l1 be put to you, and if you refuse to answer those questlons I wlll llsten to anything you have to tell me

as to why

I should

not

punlsh

you, but you

must

understand that there

1 s a very real rlsk that

you wlll

be punlshed ~f you refuse to answer the questlons. Now,

do you understand what

1 have been saylng?"

The debtor answered; Yes I understand.

The interpreter sald;

"Mrs Petruk dld not understand fully.

I W111 - - -"

His Honour sa~d: "Mr Petruk, wlll you first come back into the witness box?"

And that he dld.

In d1.1~

cgurse, M r s Perrl.lk went

Into the wtness box Ind was

sworn.

Thcrc ~ G P C ~

not ,lppe,%r to have

been

any

rurther

convcrsatlonn ,IS to whether she Imdcrstood what had been said by

the learned Jud~e, but it 1 s

particularly Iunlikely that ;he

did

not because she ha3

~ 7 e r y qood

command

o f the Enqllsh Languase.

It 1s apparent from the

transcript ot

7 May L985 that she had

such a

good command

@ C the Engllsh language

that stage,

indeed her tlrst answer

to the first question

was:

"It 13 already

said

yesterday

before

the

d puty

Registrar, Mr E l l l s ,

that thls hearing

as well as

all

prevlous hearmgs, have been achleved under sectlon 264

of thc Bankruptcv Act

1966, and I honestly fear to

answer any more questlons, and

T have explained this in

detail, and

I explained in detall before that to the

Honourable Justlce NorthrDp, and I wanted to sive some evidence to :rour Honour, you know, even if you simply

l ook at the summons

I received, you know, thls summons

represents the sample or 264."

The matter proceeded and she continued to

give evldence. The

general notlon

of It was that she contlnued

assert she was

afraid to answer questions. In due course Mr Braun,

actmq

behalf of the Offlclal Receiver,

said to Mrs Petruk, "how many

wlndsurrcrs does your husband

own?"

and she said:

"Your Honour,

am afraid to answer ,any more questions,

and I would llke to have all matters investigated undcr section 264 of the Bankruptcy Act. I am with no legal

representation.

I have tried to get

lcqal aid because I

have no money, and it has been refused and I would like to apply agaln, you know, to exerclse my rights under the Lesal kishts Commission o r Leqal Aids Commission

Act, or qet legal ald, have someone representlng me and

Hls Honour rt?pl1cd:

"Well, Mrs Petruk, I '*iould llke

you to tell

me why It IS

that you say

you are ar ra ld

to answer a questlon

llke

I	that. How can answerlnq	a questlon about wlndsurrers
brlnq you to any harm?"
i

Hls Honour replled:

"Well, that 1s the questlon that

you

have been asked to answer."

Mrs Petruk sald:

"It 1s a question why I

am here, and I am here because

thls hearlnq has been schleved as

result ot an actlon

descrlbed In the Act under sectlon 264.	That 1s why	I
am afraid to mswer any qucstlons."

Hls Honour said: "But why does that make you arraid to

answer a questlon?"

Mrs Pctruk replled:

"Yes. Why does

that

make

alratd?

I received

yesterday a transcrlpt

of proceedlnqs at Melbourne on

Wednesday 1 May 1485, 1d.20 am and it says here, r.or example, on paqc 35, where I tried to state to his

Honour, hi3 Honour the Honourable Justice

Justlce

Northrop,

that I was twlce

- that I was illegally

arrested. Now, in the transcrlpt It says, in Italy. I was never arrested in Italy, I was hardly In Italy at all. And then on the last page lt says, when I came

back from America

on 15 January.

Now, 1 was never In

America.

Not

the

15th

of January.

I was

Melbourne, Victorla. And then

it says again

- you know,

even the transcrlpts are

- you know

- - ' I

7 .

His Honour replled:	"Well, ~ t ,	mly be that - - -"
Mrs Petruk replied:

"dnd there 1t says where

I put to his Honourable

#Justice

that I

was gaoled under Bates.

I was ilngerprinted

under Bates.

His Honour sald: "Where are you readlng from?"

M r s Petruk replied:

"And then

I explained that

or' the summons 1t said Bates,

B-B-T-E-S. That

was page 2 2 , and

I said l never used

the name Eates. And ~t says here Banks.

Now, the whole

- the whole - whatever I s a d does not make any sense

all, :;lr, your Honour, because the maln words which

are

so important to this

matters

read

Banks,

B for -

B-A-M-K-S, instead of Bates, B-A-T-E-S. "

The transcrlpt then went on with

references to

that

Iintll his Honour sald:

"Yes.

Well, M r s Petruk, it seems - I cannot detect in

anything that you

have s a d to

me, any reason why

you

should not answer a questlon about wmdsurfers. Now, I must dlrect you to answer that question as to how many

wlndsurrers your husband

owns. I'

M r s Petruk replied: "Your Honour,

as I

said betore, 1

afraid to answer any questlons.

His Honour replied:

"Yes, very well. You can leave the

witness-box and

90 back to your seat in the Court."

R .

Later there was

a very long dlscusslon between

hls Honour and

the wltness as to why The would not answer the questlon and other

questlons, hls Honour sald at page

b4 :

"Mrs Petruk, I understand what you say about that, but there 1 s a dlfflc-llty; that ~r you and your husband wlll

not answer sny questlono about your

busmess It makes It

very

dliflcult

r o r

the

Courts

come

t o

proper

concluslons about whether your husband

1 s bankrupt

not own. "

not and what property he

owns and what property he does

Mrs Petruk repllcd:

"Yes.

understand your Honour, but I

have trled to

explain - maybe I expressed myself wrong. I 3111 try to

think In German.

Hls Honour said:

"I thlnk you are doing very well; I am following you

very clearly. What you are talklng to me about are all

sorts of thlngs %hat have happened in the past and In

the background. They do not really help me very much to

understand why you will not answer	a questlon about
wlndsurfers.

Mrs Petruk replled:

"Well, see, thls question would lead - It is a very

slmple questlon. sir - would Lead to further questlons."

His Honour repllerl	"yes".
Mrs Petruk replled:

"And F,o answer all khose further questions wtthmt l q a l representatlve, j l r , r would be In thls case extremely

preyldlced and dlsadvantaqed.	t do not mlnrl belnq
questloncd, SIT; not at all."

H i s Honour replled "1s that rlght?"

Mrs Pctruk sald:

"If they - 1 L there 1 s

not a - you know, If

cverythlng

1s I n

order,

if the summons reads

Elizabeth

Petruk,

l 1 n n g

whatever

address

I llve there, was a l l

properly served; It

1 s concernlng me personally,

rlght,

not somebody else. Not gettlng flnqer prlnted and maybe

deported to some other country,	sir.	I am frlghtened.
I honestly an.

The mat%er continued

wlth further

dlscussmn along slmllar

llnes. In the closlng stages of the hearlng on 7 May

there was a

dlscusslon between Mr Braun of counsel

f o r the Otficlal Recelver

and his Honour as	to the approprlatc order to be made in the case,
his Honour being	satlstled that some order ought to be made and

hls Honour reserved

hls decislon on the matter untll the followlng

Frlday when he made

an order In the followlng terms:

l'hat the appllcatlon be refused.

2 .

The

applicant

have

leave

renew

the

applicatlon

pursuant to rules 10% to 104 of the Bankruptcv Rules

for

committal for contempt.

3 .

Blternatloely to paraqraph

2, the applicant have leave

t o Instltutc proceedings pursuant

the bankruptcy

offences rules for

a breach under sectlon

264tC)tl)(b)

of the Act.

Any proceedlngs brouqhr. In accordance wlth

Order 2

Ijrder 3 above are to

be made returnable on a date tor

hearlnq

to be notlfled

the

Reglstrar

and

the

lnltlatlng docum.-nts served not lcss than

28 days before

the

date

for

the hearmq and

the

costs

the

applicatlon be reserved.

5. That the further hearing of the eramlnatlon pursuant to sectlon 81 of thls Act be adlourned untll further Order.

The proceedings before me are brought pursuant to sectlon

of	the Federal Court of Australia Act 1976 and may also be

regarded as pursuant to the leave granted by the learned Judge.

It 1s necessary to say somethlng about the

allegation by Mrs

Petruk made thls mornlnq that the

proceedmqs before

have

already broken down on the grounds that there has been

a fallure

In what she called,

I think the contlnulty

of the proceedmqs. In

thls she relled upon an alleqatlon that on 3 February 198b,

the

matter then belng before Mr

Justlce Jenklnson and he belng the

Judge whom she had expected to be In court on the aIternoon of

that date, dld not appear but arrangements had been made for Mr

Justlce Keely to deal

wlth the matter.

Accordlnq to Mrs Petruk. Mr Justlce Jenklnson had given her

the optlon of choosmq, contrary to his Honour

S feellngs that the

matter should not be dealt wlth by

hlm, but should be dealt wlth

by another ~udqc,

that

It should be heard by hlm. Accordlnq to

her she had elected that the matter should

be dealt with by hls

Honour. As far as I gathered, trom the slbmlsslon by her.

lt. was

because Mr Justlce Jenklnson had

m a sense agreed to hear the

matter ~f she wantcd hlm to do

so,

and she havlng expressed

deslre that she dld want

hlm to do so, that the proceedings broke

down when they were taken over by another

~udge, notwlthstandlng,

that all Mr Justlcc Keely dld, was to ad~ourn

the matter Into a

call-over date when a date for

a hearmg could be flxcd.

It appears that In fact what occurred betorc

Justlce

Jenklnson was qultc dlrferent. It appears on

20 December

1Y85,

when the matter was before

Mr Justlcc Jenklnson and

Mrs Petruk and

her husband were both present, there was

a proceedmq aqalnst Mr

Petruk as well

as agalnst her, and that hls Honour dealt

wlth the

proceedmq agalnst Mr Petruk. He had glven ~udgment

In It whlch I

know now

not to be adverse

to Mr Petruk. His Honour sald:

"Mrs Petruk, we have part heard the case brought by the rjfflclal Trustee aqalnst you allcglng contempt on the

7th of May.

It seems to me undeslrable on reflection

that I should hear that case, and unless you lnslst

contlnue to hear the case

I propose to tcrmlnatc the

hearlng and make orders to brlnq It before another

Judge. Although,

as we have already sald.

it wlll

any event be not untll next February.

Do you

that

? "

Mrs Petruk replled:

"Yes, your Honour".

His Honour

replled:

"Do you ob~cct

to my taklnq

that

course?"

Mrs Petruk replled: No, your Honour, If I could lust say

couple ot words?"

Hls Honour reptled:	"Yes".
Mrs Pctruk sald:

''I would llke to ask ~f the Honourable Court would conslder the proccedlngs for my contempt to hold the

proceedmgs of 397 of L985 untll my contempt ot	court
proceedmgs are completed."

There was then

long dlscussion between his Honour and Mrs

Petruk. Mrs Petruk sought an order that applicatlons whlch had already been made, or were In contemplatlon of belng made by the Gfficlal Trustee In the bankruptcy of her husband. and In respect of whlch certaln clalms by her would be involved should not be

dealt, with until the contempt proceedlngs

court agalnst her

were completed and In the end his Honour dld	mdlcate that he
would so order.

It 1 s beyond

doubt that Mrs Petruk understood exactly what

his Honour was dolng.

Hls Honour, havlng decided,

as one could

well understand he mlght, that havlng heard the one case It

was

deslrable perhaps that another ludge who was unacqualnted wlth the

matters alleged agalnst the husband should hear the case against

Mrs Petruk.

So that order was duly made.

For the purposes

convenlence ot counsel wlth

a vlew to rlndlng

date, a hearlng at

4.15 pm on 3 February 1 Y Y 6 was tixed. As lndlcated above, it duly came on that day wlth the results that have been mentloned, and the case duly appeared In the call-over list and was set down for hearlng before me on thls day.

Mrs Petruk was rully aware

ot aL1 that and has attended today

before me to put her application.

No specltic ground atrectrng me

personally seemed to be formulated by

M r s Petruk, and there was

nothmg in

her submlsslons about the contlnulty

or' thls case.

When those matters rercrred to were consldernd and seemed to be

stated above

it became my duty to go ahead

wlth thls case.

When one takes up the merlts one

1 s faced wlth the fact that

this lady, 1s obvlously qulte mtelllgent, apparently very strong

physically, has a good command

or' the EnrJllsh language, has plenty

of courage to put her

case, and has a good understandlnq,

I think,

of what It 1 s

all about.

appears wlthout any amblgulty that

she declded that

she would not answer the questlon about how many

winsurfers her husband had on the ground that she was afraid	so to
answer.

The learned Judge felt that there was very little to fear on

her part to the answermg

of that questlon, and the same appears

to me to be the sltuatlon. Indeed, on readlng the

transcript

appears not to be

so much that questlon which

Mrs Petruk feared as

some questlon whxh mlght possibly follow it.

But, of course, It

remains qulte clear that the questlon whlch had been put to her

was the one that she refused to answer.

It 1 s clear that she was directed

the learned Judge to

answer It after a most patient hearlnq by h m of all the	reasons
for and agalnst that she could put for the answering of that

questlon. No doubt hopmg that Mrs Petruk would think better of

the matter hls Honnur made the order that he did whlch gave her

time to conslder her posltlon. She

has

had almost 11 months to

conslder her positian and she has

reframed

from glvlng any

intimation

to this Court that she

willing to answer the

question. Her strategy

or tactlcs have been to attack the very

foundation upon which thls Court can proceed under sectlon

El of

the Bankruptcv Act 196%

In accordance with the provlsions of the

law relating to the elucldatlon of affairs relating to bankrupt

estates. If her attltude

1 s

tolerated that elucidation wlll

all probability be totally frustrated.

I cannot think that she is not aware

of this.

She has had

months to consider whether she should answer

a questlon about

whether her husband had any windsurters, and it is abvlous that If

she can possibly avoid

it she does not propose

to answer that

questlon. As far as one can

~udge

by reading the transcript

before hls Honour

Mr Justice Woodward for reasons whlch are not

really rational, because of this alleged

fear, she does not Intend

to answer any questlons concerning the condition	of	property
relationships between herself and her husband.

The

proof of these matters has been made by

direct

affidavit by a person who was In court before the whole of the

proceedings before Mr Justicc Woodward, namely, by Mr Turner, the

reallzatlon officer o t the Ofticicil Trustee. It 1 s there set out

that Mrs Petruk was sworn and that all the statements attributcd

to the varlous people In the transcrlpt were duly made as they are

thereln set out.

L5.

The problem, thererore, before me

1s what sort or

punlshment

should be Imposed. Having regard to the attltude ot the applicant

before me thls mornlnq, and taklnq that Into account wlth all that

I have been able

t o read ln the transcrlpt before me.

cannot

doubt that the strategy of the respondent is to obstruct the

proceedlngs of the

Codurt so that they wlll never be carrled to

completlon.

If that occurs the ob~ect

ot the lcglslatlon wlll be

frustrated In thls case.

It seems to me

I should take Into account first of all the

mlsconduct lnvolved In falling to obey a direction of a

learned

Judge to answer the questlon

whlch was put to her and, secondly,

the lmplicatlon thereof and of her attitude generally to the

admlnlnstration of the law.

It seems that arlsing out

of varlous

proceedings whe has already suffered some

f w days Incarceration.

She suffered some short lncarceration over Chrlstmas in

1984.

did not have an opportunlty or, I

suppose, I had an opportunlty

but the way the matter went before

me, no

informatlon was glven to

her or perhaps I should say no renewed lntimatlon was made to her

that she stood in per11 of lncarceratlon unless she was prepared

to answer the question. But I do not doubt that she 1 s well aware

of the risk that she

1 s runnmg, but she IS a woman of courage and

is prepared to take

It.

To my mind, the more important

of the two aspects, that

1s to

say the aspect

of punlshlng a lady t o r not answerlng a question on

7 May and the vlndlcatlon

of the law in relatlon to the necessity

to ensure that the proceedings

of the Court are not frustrated by

recalcltrant persons, such

a one as she undoubtedly is.

That is

much thc more Important aspect ot the matter whlch 1s before

me,

and I cannot help but thmk that provlded she 1s glvm an opportunlty to reconslder her posltlon and retrace her steps and announce her willlngness to answer the questlon and any other

relevant questions, that some substantlal punlshment wlth

n e w

to the enforcement	of the law 1s not only lustified but called
for.

I am aware that

f o r slmllar "orfence"

Mr Petruk was ordered

to be lmprlsoned for

days. There

was a stay to give

hlm

chance to reconslder his sltuatlon, but

he took no advantage

of It

and I am Informed

he had never yet been arrested or requlred to

iulfll the term

of lmprlsonment whlch was awarded agalnst him. It

seems, no doubt, unfair and certalnly not In accordance wlth

current notlons

o f equallty of

opportunity and equality of the

sexes generally that she should recelve	a punishment greater than
his.

In the clrcumstances, however,

seems to me that unless

resolute actlon

IS taken by the court to ensure that procedures of

the law shall not be frustrated unlaw'tully, in thls case and

perhaps other cases

- certalnly in thls case

- that It is

desirable that the sentence should

be materlal and substantlal ~ f .

thls lady remams of the same m m d as she is of today. I also

thlnk that it should be made perfectly plaln to her that she does

not have to serve any part of this sentence 1t she wlll agree to

obey the law.

To give her every opportunlty, therefore,

ot staying out of

prlson or of belnq discharyd from prlson 1f she permlts herself to be mcarceratcd, I propose two things. Flrstly, the order 1 am

about to make shall be s~~blect

o it stay ot l4 days and, secondly,

that there be dellvered to her at or about the time of her arrest

a notlce to the

following ett.ect:

That it is within the competence of the Court to order her discharge from prlson at any tlme before the explry

of the term

o t imprlsonment Imposed upon

her by this

Court on this

day, 2 Bprll 1986.

2 .

That upon appllcatlon by

her for a dlscharge from prlson

it would be an

important factor in her favour that she

should

undertake

answer

the questlon

which

she

refused to answer on

7 May 1985 and any other questlons

whlch may be properly put to her upon her examlnatlon

under section 81 of the Bankruptcy Act. 1966.

3 .

That an

application for discharqe from prlson may be

made by application served upon the applicant

herem.

It will be an order of the Court that at or about the

tun of

the arrest she be served

wlth this order. I now make that order.

Further that the order for imprisonment 1s made pursuant to

the powers

the Federal Court of Australia in Its general

division In

the Bankruptcy District for the State of Victorla

exerclsmg bankruptcy ~urisdictlon

but

wlth all

the powers the

Federal Court of Australia has by vlrtue of the Federal Court of

Australia Act.

18.

Pursuant to those powers, I order sub~ect

to %he stay order,

that thls lady be lmprlsoned tor the term o t s1x months.

I order

the respondent

to pay the costs o t the proceedmqs. I grant

liberty to apply

to everybody.

[1986] FCA 324

4 Feb 1986