Re Curry; Ex parte Goldsea Pty Ltd - [1992] FCA 1030

Re: VALERIE EVELYN CURRY
Ex parte: GOLDSEA PTY LTD
No. P Q1209 of 1992
FED No. 1030
Number of pages - 11
Bankruptcy
(1992) 40 FCR 32

COURT

IN THE FEDERAL COURT OF AUSTRALIA

BANKRUPTCY DISTRICT OF THE STATE OF QUEENSLAND
GENERAL DIVISION
Spender J.(1)

CATCHWORDS

Bankruptcy - acts of bankruptcy - contested creditor's petition - judgment debt - act of bankruptcy constituted by failure to present debtor's petition within time specified by special resolution of creditors' meeting - authority to call meeting of creditors not effective for purposes of Part X - nature of relationship between trustee or solicitor to whom authority is given and debtor - whether acts of bankruptcy require an authority effective for purposes of Part X.

Bankruptcy Act 1966 ss. 40, 44, 188, 204, 221

Re Donovan; ex parte A.N.Z. Banking Group Ltd (1971-72) 20 FLR 50.

HEARING

BRISBANE

#DATE 11:12:1992

Counsel for the petitioning creditor: Mr M. Kent

Instructed by: Phillips Fox

Counsel for the debtor: Mr A. Philp

Instructed by: Radcliff Lather and Buckland

ORDER

THE COURT ORDERS THAT:

1. Creditor's Petition No. 1209 of 1992 is dismissed.

2. The petitioning creditor pay the debtor's costs of opposing

the petition, including reserved costs, to be taxed if not agreed.

Note: Settlement and entry of orders is dealt with in Rule 124 of the Bankruptcy Rules.

JUDGE1

SPENDER J. This is a contested creditor's petition. The petitioning creditor, Goldsea Pty Ltd ('Goldsea'), asserts in the petition that Valerie Evelyn Curry is justly and truly indebted to it in the sum of $85,201.69 (eighty-five thousand two hundred and one dollars and sixty-nine cents), being moneys owing pursuant to a judgment obtained by Goldsea against Mrs Curry in the District Court at Brisbane on 26 April 1991.

The creditor's petition is not based on the usual act of bankruptcy of failure to comply with a bankruptcy notice, but alleges the act of bankruptcy constituted by s. 40(1) of the Bankruptcy Act 1966 ('the Act'), which provides:

" A debtor commits an act of bankruptcy in each of the following cases:

...

(l) if, having been required by a special resolution of a meeting of his creditors so called...to present a debtor's petition, he fails, without sufficient cause: ...

(ii) to present a debtor's petition within the time specified in the resolution;

as the case may be; "

Paragraph 4 of the amended creditor's petition alleges:

" Despite having been required by a special resolution of a meeting of the creditors of the debtor held on 6 December, 1991 to present a Debtor's Petition within 7 days from the day on which the special resolution was passed, the Debtor has failed to present the said Debtor's Petition on or before 13 December 1991. "

Section 40(5) provides:

" The act of bankruptcy specified in paragraph (1)(l) shall be deemed to be committed on the day after the day on which the period within which the deed is required to be executed by the debtor or the…

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: [1992] FCA 1030
Decision Date: 11 DECEMBER 1992

CaseChat Overview and Summary

Goldsea Pty Ltd sought to have Curry declared bankrupt through a creditor’s petition, alleging Curry had committed an act of bankruptcy by failing to present a debtor’s petition within the time specified by a special resolution of a creditors' meeting. The court had to determine whether the act of bankruptcy required an authority effective for the purposes of Part X of the Bankruptcy Act 1966 (Cth). Specifically, it needed to consider the nature of the relationship between the trustee or solicitor to whom authority was given and the debtor.

The court examined whether the authority given to the trustee or solicitor was effective for the purposes of Part X. The authority in question was issued by a creditors' meeting under section 26 of the Bankruptcy Act 1966 (Cth). The court held that the authority given was not effective for the purposes of Part X, as it did not comply with the requirements set out in section 26 of the Act. Therefore, the court found that the act of bankruptcy did not occur as the authority was not effective.

Consequently, the court dismissed the creditor's petition and ordered that Goldsea Pty Ltd pay Curry’s costs of opposing the petition, including reserved costs, to be taxed if not agreed. The dismissal of the petition meant that Curry was not declared bankrupt, and Goldsea Pty Ltd was liable for the costs incurred by Curry in opposing the petition.

Orders

Orders of the court

THE COURT ORDERS THAT:

1. Creditor's Petition No. 1209 of 1992 is dismissed.

2. The petitioning creditor pay the debtor's costs of opposing

the petition, including reserved costs, to be taxed if not agreed.

Note: Settlement and entry of orders is dealt with in Rule 124 of the Bankruptcy Rules.

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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