Re Cape, William Timothy Ex Parte Cape, William Timothy Summary

IN THE FEDERAL COURT OF AUSTRALIA )
GENERAL DIVISION                 )    No. NB 2488 of 1994
BANKRUPTCY DISTRICT OF           )
NEW SOUTH WALES                  )

Re:WILLIAM TIMOTHY CAPE

Bankrupt

Ex parte:WILLIAM TIMOTHY CAPE

Applicant

And:PAUL DESMOND SWEENEY

Respondent

REASONS FOR JUDGMENT

EINFELD J SYDNEY 31 OCTOBER 1997

On 14 October 1997 I gave judgment in a number of applications before the Court arising out of the bankruptcy of William Timothy Cape. The bankrupt’s applications of 17 October and 6 November 1996 were dismissed with costs. The trustee’s application for security for costs in respect of the bankrupt’s amended application of 26 November 1996 was adjourned to permit the trustee to seek summary judgment and the bankrupt to make submissions on summary judgment. Both of these actions have now been completed and I have read the submissions. I have also re-read all the papers and submissions in this complex matter.

In addition a person named Ezekiel Ezra on behalf of the former receiver of Redarb Pty Ltd, R.J. Yeomans, has asked that the order for costs made in the judgment of 14 October be made “against Cape personally on an indemnity basis”. Mr Ezra also asked that the Court “specify in the interest of clarity that the Costs Order encompasses the costs incurred by the Receiver and or (sic) Redarb Pty Ltd in meeting the application first served by Cape upon the former Receiver and Redarb Pty Ltd (application dated 5 November 1996) as amended by the application dated 26 November 1996 in relation to which all parties were the subject of Orders made on 19 November 1996”. To the extent that Mr Ezra is entitled to make any application in the matter, I refuse the order for indemnity costs as inappropriate to this case. The additional “specification” requested misconceives the judgment of 14 October 1997, and is in any event not necessary as the costs order made was sufficiently specific to enable the taxing officer to deal with the matters referred to.

Mr Cape’s bankruptcy came to an end with his automatic discharge on 27 October 1997. As a consequence, the trustee’s consent to Mr Cape’s proposed actions against the former receiver, against Duesbury’s, and against the trustee, including any application to the ACT Supreme Court to set aside the original judgment on which his bankruptcy was based, is no longer required. It is therefore not necessary for me to decide whether the Court has power to compel a trustee in bankruptcy to consent to an action being brought in the name of the bankrupt or to assign to the bankrupt the right to sue.

After giving close attention to Mr Cape’s submissions, my decision on the specific requests in the amended application are:

Refused as inappropriate. The police have anyway declined to take any action.

No assent is now necessary.

Refused. There is no evidence that any other activities are still to be undertaken or as to why they would be stayed.

No other order was sought.

Mr Cape’s amended application of 26 November 1996 is dismissed with costs. I dismiss those parts of the trustee’s amended application of 16 October 1997 which seek summary dismissal and security for costs of Mr Cape’s application of 4 September 1996 to set aside the section 139ZQ notices. That application and the balance of the trustee’s amended application seeking to set aside the transactions which were the subject of those notices, are adjourned for directions to 9.45am on Friday 19 December 1997 to see what if any actions are taken in respect of the proposed proceedings. There will be liberty to apply on seven days notice.

In this case, William Timothy Cape, a bankrupt, filed an application against Paul Desmond Sweeney, the respondent, in the Federal Court of Australia, General Division, under the Bankruptcy Act. The application was related to matters arising from Cape’s bankruptcy, including several applications and subsequent responses from both parties. The court was tasked with deciding on various issues, such as the appropriateness of an order for indemnity costs against Cape, the necessity of the trustee’s consent for certain actions post-discharge of bankruptcy, and the dismissal or adjournment of specific applications made by Cape and the trustee.

The court considered whether the order for indemnity costs against Cape was appropriate and whether the specification requested by the former receiver of Redarb Pty Ltd was necessary. It was determined that such an order was inappropriate and unnecessary as the previous costs order was sufficiently specific. Additionally, the court addressed whether it had the power to compel a trustee to consent to an action or assign the right to sue to the bankrupt, but found it unnecessary to decide this as Cape’s bankruptcy had ended with his automatic discharge. The court also examined the necessity of trustee consent for proposed actions post-discharge and concluded that no such consent was necessary.

Based on the submissions and evidence, the court dismissed Cape’s amended application and certain parts of the trustee’s application while adjourning others for further directions. The court ruled that the trustee’s requests for summary dismissal and security for costs in relation to Cape’s application to set aside notices were to be dismissed, and the remaining parts of the trustee’s application were adjourned for further proceedings. The court allowed liberty to apply for further orders on seven days' notice.

Re Cape, William Timothy Ex Parte Cape, William Timothy

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established