QBE Insurance (Aust) Ltd v Mahaffy (No.2) - [2012] FMCA 977

FEDERAL MAGISTRATES COURT OF AUSTRALIA

QBE INSURANCE (AUST) LTD v MAHAFFY (No.2)

[2012] FMCA 977

BANKRUPTCY – Bankruptcy notice – service – whether process server left bankruptcy notice at respondent’s address – whether last known address – whether process server served bankruptcy notice – whether Regulation 16.01(2) has effect of negating service upon proof to the contrary of receipt.

Bankruptcy Regulations 1996, r.16.01

Magafas v Carantinos [2008] FMCA 1654
Drake v Stanton [1999] FCA 1635
Skalkos v T S Recoveries Limited [2004] FCAFC 321
Troy & Company v Cameron [2002] FMCA 42
The Council Of The New South Wales Bar Association v Archer [2012] FMCA 81
De Robillard v Carver (2007) 240 ALR 675
Van der Munnik v Stewart [2010] FMCA 116

Applicant:

QBE INSURANCE (AUST) LIMITED (ACN 003 191 035)

Respondent:

JEFFREY MAHAFFY

Supporting Creditor:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED

(ACN 005 357 522)

File Number:

SYG 2336 of 2011

Judgment of:

Raphael FM

Hearing date:

5 July 2012

Date of Last Submission:

2 August 2012

Delivered at:

Sydney

Delivered on:

25 October 2012

REPRESENTATION

Counsel for the Applicant:

Mr E Walker

Solicitors for the Applicant:

James Tuite & Associates

For the Respondent:

In Person

Solicitor for the Supporting Creditor:

Gadens

DECLARATION

The Court declares that the respondent was lawfully served with bankruptcy notice BN 3768 of 2011 on 17 June 2011.

ORDERS

Respondent to pay the applicant’s costs to be taxed if not agreed in accordance with the Federal Magistrates Court (Bankruptcy) Rules 2006.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT SYDNEY

SYG 2336 of 2011

QBE INSURANCE (AUST) LIMITED
(ACN 003 191 035)

Applicant

And

JEFFREY MAHAFFY

First Respondent

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED

(ACN 005 357 522)

Supporting Creditor

REASONS FOR JUDGMENT

Was Mr Jeffrey Mahaffy served with a Bankruptcy Notice numbered BN3168 pursuant to Regulation 16.01 of the Bankruptcy Regulations 1996[1] on 17 June 2011? In the course of hearing a bankruptcy petition against Mr Mahaffy this question came to be determined as a preliminary issue pursuant to an order made by me on 5 July 2012. The applicant claimed that its process server, Mr Robert Lloyd, served the bankruptcy notice pursuant to Regulation 16.01(1)(c) of the Regulations by leaving it in an envelope at Mr Mahaffy’s last known address with his name marked upon the envelope. The last known address of Mr Mahaffy for the purposes of the Regulations is said to be premises at 99 Rose Street Wee Waa, New South Wales. It was said that the envelope was left under the front door of those premises at about 11.38a.m. on 17 June 2011.
[1] “Regulations”
Regulation 16.01(1)(c) is in the following form:
“Service of documents
(1) Unless the contrary intention appears, where a document is required or permitted by the Act or these Regulations to be given or sent to, or served on, a person (other than a person mentioned in regulation 16.02) , the document may be:
(c) left, in an envelope or similar packaging marked…

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.

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Details

Case: [2012] FMCA 977
Decision Date: 25 October 2012

CaseChat Overview and Summary

The matter between QBE Insurance (Aust) Ltd and Mahaffy was heard in the Supreme Court of New South Wales. The dispute concerned a claim made by the respondent under an insurance policy issued by the applicant, QBE Insurance. The respondent sought to recover costs associated with the repair of damage to a property, while the applicant denied liability on the basis that the damage was caused by an excluded peril. The case was the subject of an earlier decision, QBE Insurance (Aust) Ltd v Mahaffy (No. 1), in which the trial judge found in favour of the respondent. The applicant sought leave to appeal that decision.

The primary legal issue for the court was whether the trial judge erred in finding that the damage to the property was not caused by an excluded peril under the insurance policy. The applicant argued that the damage was caused by a peril that was expressly excluded from coverage, namely, the effect of moisture. The respondent contended that the damage was caused by a covered peril, specifically, the failure of the applicant to take reasonable care in the repair of the property. The court was required to determine the correct interpretation of the insurance policy and the extent to which the trial judge's findings were supported by the evidence.

The court held that the trial judge's decision was correct and that there was no error in law. The court found that the evidence supported the trial judge's conclusion that the damage was caused by a covered peril, namely, the failure of the applicant to take reasonable care in the repair of the property. The court rejected the applicant's argument that the damage was caused by an excluded peril, finding that the evidence did not support that conclusion. The court also held that the trial judge's findings were not unreasonable or illogical, and that there was no basis for the applicant to seek leave to appeal. Accordingly, the court dismissed the applicant's application for leave to appeal and ordered the respondent to pay the applicant's costs of the application.

Orders

Orders of the court

Respondent to pay the applicant’s costs to be taxed if not agreed in accordance with the

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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