Porter v Ghasemi

Case [2021] FCAFC 144

FEDERAL COURT OF AUSTRALIA

Porter as former trustee of the estates of Ghasemi and Kakhsaz v Ghasemi [2021] FCAFC 144

Appeal from: Druin Pty Ltd atf Druin No 3 Trust t/as Harvey Norman Commercial v Ghasemi [2020] FCCA 2456
File number: NSD 1119 of 2020
Judgment of: ALLSOP CJ, MARKOVIC, DERRINGTON, COLVIN AND ANASTASSIOU JJ
Date of judgment: 12 August 2021
Catchwords: BANKRUPTCY AND INSOLVENCY - application by trustee for extension of time to seek leave to appeal from decision of Circuit Court - appeal by trustee from decision of Federal Circuit Court as to trustee's remuneration - where primary judge on review of registrar's decision made orders in terms of consent of petitioning creditor and debtors to set aside sequestration orders and dismiss creditor's petition - where primary judge dismissed trustee's application as intervener for order for annulment of bankruptcy and made limited orders for payment of trustee's costs properly and reasonably incurred - consideration of power of Circuit Court to make consequential orders as conferred by s 104(3) of Federal Circuit Court of Australia Act 1999 (Cth) - whether primary judge erred in declining to exercise discretion to order annulment - whether a discretionary power to order annulment upon review of exercise of delegated judicial power unconstitutional - consideration of general approach of Circuit Court for determination of appropriate consequential orders as to trustee's costs - whether primary judge erred in determining appropriate orders as to trustee's costs - application for extension of time allowed - leave to appeal granted - appeal dismissed
Legislation:

Bankruptcy Act 1966 (Cth) ss 19, 77, 109, 153B, 154

Federal Circuit Court of Australia Act 1999 (Cth) s 104
Cases cited:

Bechara v Bates [2021] FCAFC 34; (2021) 388 ALR 41

BJM15 v Minister for Immigration and Border Protection [2021] FCA 786

Boensch v Somerville Legal [2021] FCAFC 79
Décor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 844; (1991) 33 FCR 397

Flint v Richard Busuttil & Company Pty Ltd [2013] FCAFC 131; (2013) 216 FCR 375

Hunter Valley Developments Pty Ltd v Cohen, Minister for Home Affairs and Environment [1984] FCA 186; (1984) 3 FCR 344

Jackamarra v Krakouer [1998] HCA 27; (1998) 195 CLR 516

Parker v The Queen [2002] FCAFC 133

Pattison v Hadjimouratis [2006] FCAFC 153; (2006) 155 FCR 226

Robson as former trustee of the estate of Samsakopoulos v Body Corporate for Sanderling at Kings Beach CTS 2942 [2021] FCAFC 143

Division: General Division
Registry: New South Wales
National Practice Area: Commercial and Corporations
Sub-area: General and Personal Insolvency
Number of paragraphs: 62
Date of hearing: 18 June 2021
Counsel for the Appellant: Mr A Spencer with Mr J Parrish
Solicitor for the Appellant: Gartree Thomson Lawyers
Counsel for the First and Second Respondents: Mr B Webster
Solicitor for the First and Second Respondents: Just Dispute Resolution
Counsel for the Third Respondent: Mr D Krochmalik with Ms N Bailey
Solicitor for the Third Respondent: CCSG Legal

ORDERS

NSD 1119 of…

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Porter v Ghasemi [2021] FCAFC 144
Case
[2021] FCAFC 144
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CaseChat Overview and Summary

Porter v Ghasemi is a case that involves the application by a trustee for an extension of time to seek leave to appeal a decision made by the Circuit Court. The trustee's appeal pertains to the decision regarding the trustee's remuneration. The Circuit Court had made orders to set aside sequestration orders and dismiss a creditor's petition, as per the consent of the petitioning creditor and the debtors. The primary judge dismissed the trustee's application as an intervener for an order of annulment of bankruptcy, and made limited orders for the payment of the trustee's costs properly and reasonably incurred.

The legal issues that the court had to decide were whether the primary judge erred in declining to exercise the discretion to order annulment and whether there was a discretionary power to order annulment upon review of the exercise of delegated judicial power that was unconstitutional. Additionally, the court had to consider the general approach of the Circuit Court for determining appropriate consequential orders concerning the trustee's costs and whether the primary judge erred in determining the appropriate orders concerning the trustee's costs.

The court allowed an extension of time to seek leave to appeal out of time, granted leave to appeal, and permitted the appellant to amend the grounds of appeal. The appeal was ultimately dismissed, and the appellant was ordered to pay the respondents' costs of the appeal. The court's reasoning was based on the assessment of the Circuit Court's power to make consequential orders as conferred by s 104(3) of the Federal Circuit Court of Australia Act 1999 (Cth), as well as the appropriate approach to determining consequential orders concerning the trustee's costs. The court found no error in the primary judge's decisions regarding the annulment and the costs orders.

Orders

Orders of the court

1. There be an extension of time to seek leave to appeal out of time.

2. There be leave to appeal.

3. There be leave to the appellant to amend the grounds of appeal in terms of the further amended notice of appeal dated 21 May 2021.

4. The appeal be dismissed.

5. The appellant do pay the respondents' costs of the appeal to be assessed if not agreed.

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

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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