Legal Research
Cases
Prentice v Cummins (No 4)

Prentice v Cummins (No 4)

Case [2002] FCA 1215 2 October 2002

Jurisdiction

No Case Submission

Transfers to Defeat Creditors

Bankruptcy Act 1966

Costs

Bankruptcy Law

Civil Litigation & Procedure

Type to search within this case.

FEDERAL COURT OF AUSTRALIA
Prentice v Cummins (No. 4) [2002] FCA 1215
PRACTICE & PROCEDURE – application by respondents to put no case submission without electing whether or not to call evidence – respondents not alleged to have engaged in fraud.
Bankruptcy Act 1966 (Cth), ss 77, 81, 121(1)
Bankruptcy Legislation Amendment Act 1996 (Cth), Sch 1, [208]
Trade Practices Act 1974 (Cth)
Prentice v Cummins (No 1) [2002] FCA 1140, cited.
Prentice v Cummins (No 2) [2002] FCA 1165, cited.
Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344, cited.
Protean Holdings (Ltd) (Receivers and Managers Appointed) v American Home Assurance Co (1985) VR 187, applied.
Rasomen Pty Ltd v Shell Company of Australia Ltd (1997) 75 FCR 216, applied.
The Union Bank of Australia Ltd v Puddy [1949] VLR 242, cited.
Compaq Computer Australia Pty Ltd v Merry (1998) 157 ALR 1, cited.
Cannane v J Cannane Pty Ltd (in liq) (1998) 192 CLR 557, cited.
MAXWELL WILLIAM PRENTICE & ANOR (together the Trustees of the property of John Daniel Cummins, a Bankrupt) v MARY ELIZABETH CUMMINS & ORS
N 7481 of 2001
SACKVILLE J
SYDNEY
2 OCTOBER 2002

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 7481 OF 2001

BETWEEN:

MAXWELL WILLIAM PRENTICE
FIRST APPLICANT

MARK JULIAN ROBINSON
SECOND APPLICANT
(together the Trustees of the Property of John Daniel Cummins, a Bankrupt)

AND:

MARY ELIZABETH CUMMINS
SECOND RESPONDENT

AYMCOPIC PTY LIMITED
THIRD RESPONDENT

HOSPITALITY HIRE PTY LIMITED
FOURTH RESPONDENT

JUDGE:

SACKVILLE J

DATE:

2 OCTOBER 2002

PLACE:

SYDNEY

PROCEDURAL RULING ON NO CASE SUBMISSION
THE PROCEDURAL COURSE

The nature of these proceedings and the reasons for the removal of the Bankrupt as a party appear in two earlier judgments: Prentice v Cummins (No 1) [2002] FCA 1140; Prentice v Cummins (No 2) [2002] FCA 1165.
On the second day of the trial, at the conclusion of the case in chief for the applicants (“the Trustees”), Mr Brereton SC, who appeared with Mr Ashhurst for the respondents, informed the Court that he wished to make what is usually referred to as a no case submission in relation to several of the issues raised by the pleadings. In particular, he foreshadowed that he wished to submit that the respondents had no case to answer in relation to the Trustees’ claims that
(i)the Bankrupt had transferred a share of the matrimonial home beneficially owned by him to the second respondent (“Mrs Cummins”) in August 1987 for the purpose of preventing the property from becoming divisible among his creditors;
(ii)the Bankrupt had transferred 6,000 shares in Counsel’s Chambers Limited to Aymcopic Pty Ltd (“Aymcopic”), the trustee of the Cummins Family Trust, for the purpose of preventing those shares becoming divisible among his creditors; and
(iii)the Bankrupt had transferred various sums of money to Mrs Cummins without consideration, for the purpose of preventing the funds becoming divisible among his creditors or, alternatively, at…

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 Prentice v Cummins (No 4)

Details

AGLC: Prentice v Cummins (No 4) [2002] FCA 1215
Case: [2002] FCA 1215
Decision Date: 2 OCTOBER 2002

CaseChat Overview and Summary

In the Federal Court of Australia, the Trustees of the property of John Daniel Cummins, a bankrupt, brought proceedings against several respondents including Mary Elizabeth Cummins and various companies. The Trustees sought to establish that the bankrupt had transferred assets to the respondents to defeat or delay his creditors. Specifically, the Trustees alleged that the bankrupt had transferred shares in Counsel’s Chambers Limited and a share in the matrimonial home to the respondents for the purpose of preventing those assets from becoming divisible among his creditors. The Trustees also sought a declaration that the bankrupt had transferred various sums of money to Mrs Cummins without consideration or at an undervalue, for the same purpose. The respondents sought to make no case submissions in relation to some of the claims, arguing that the Trustees had not established a prima facie case. The central issue before the court was whether the respondents should be permitted to make no case submissions without first electing not to call evidence.

The court considered the general rule that a party should not be permitted to make a no case submission unless they elect not to call evidence. This rule ensures orderly and fair trial proceedings. However, the court also recognised a discretion to depart from this rule where it would be just and convenient to do so. The respondents argued that a departure from the rule was warranted because fraud was alleged against the bankrupt, a third party. They argued that this might save court time and costs. The Trustees opposed this application, arguing that the general rule should apply and that the respondents should not be permitted to make selective no case submissions.

The court found that the general rule should apply in this case. Although fraud was alleged, it was alleged against the bankrupt, not the respondents. The court noted that the rationale for permitting no case submissions in fraud cases was that a defendant should not be required to give evidence and submit to cross-examination before there is sufficient evidence against them. This rationale did not apply here because no fraud was alleged against the respondents. The court also noted that any savings in court time would likely be insubstantial since some issues would still require evidence. The court ruled that the respondents could only make no case submissions if they elected not to call evidence on all issues. This ruling followed from the consent of the parties to proceed in the manner proposed by the respondents’ counsel.

Orders