Re Draper, John Ex parte Brosalco Pty Ltd

Re: JOHN DRAPER
Ex parte: BROSALCO PTY. LIMITED (1983) 72 LR 179
No. P671 of 1982
Bankruptcy Petition

COURT

IN THE FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION
BANKRUPTCY DISTRICT IN THE STATE OF NEW SOUTH WALES AND THE AUSTRALIAN CAPITAL TERRITORY
McGregor J.(1)

CATCHWORDS

Bankruptcy Petition - Notice of Opposition - debt on which petition relied said not to be of judgment debtor - going behind judgment - original contract with judgment debtor - payments of debt by company not judgment debtor - dealing by petitioning creditor consistent with contract by him personally - order extending time at the expiration of which the petition will lapse - order made after 12 months had expired.

Bankruptcy Act 1966 s.33(1)(c), s.52

Bankruptcy - Petition - Notice of opposition - Debt on which petition based said not to be that of judgment debtor - Court going behind judgment - Original contract with judgment debtor - Payments of debt by company, not judgment debtor - Dealing by petitioning creditor consistent with contract by him personally.

Bankruptcy - Petition - Order extending the time at the expiration of which the petition will lapse - Order made after expiration of twelve months - Bankruptcy Act 1966 (Cth), ss 33(1)(c), 52.

HEADNOTE

The petitioning creditor obtained a default judgment against the debtor in the District Court. The debtor applied to set the judgment aside but failed on the basis that there was no viable or prima facie defence, nor any reasonable excuse shown for the delay in applying (over one year). A bankruptcy notice was served and the debtor applied unsuccessfully again to set aside the judgment. A petition was issued and served. A notice of intention to oppose petition was filed. The basis of opposition was that the judgment debt was incurred in fact by a company of which the debtor was a director, and that the judgment was obtained by fraud in that the creditor knew the debt was that of the company.

The creditor sold cane goods and had dealt with the debtor over a period of two years prior to the date of judgment. At the first meeting the debtor advised that the goods were to be invoiced to a firm - Tropical Cane Centre. The goods were i invoiced in that name and correspondence was also in that name. Payments for various orders had been made by cheques from Tropical Cane Centre, the company, from the debtor and one from another entity. There was no evidence of any communication whereby the creditor was told that the company was the purchaser. The company was in financial difficulties and had never offered to pay the debt. The debtor also took the point at the end of the hearing in June 1983 that, as twelve months had expired since the petition was presented, it had lapsed.

Held: (1) That the court should not go behind the judgment; the case was not one where there was a bona fide allegation that no real debt lay behind…