Re Exell, Judith Ex parte Martin, Susan - [1995] FCA 1079

CATCHWORDS

BANKRUPTCY - Bankruptcy notice - creditor unable to issue warrant of seizure and sale without leave - other forms of enforcement of judgment available - whether execution of the judgment has been stayed.

Bankruptcy Act, ss 40(1)(g), 41(3), 54A, 54C, 54E.

Judgment Debt Recovery Act 1984 (Vic) ss 6, 9.
Supreme Court Rules (Vic) Rr 59.02, 66.02, 68.01, 68.02.
Supreme Court Rules (Qld) O 47 r 3, 23, 24.

re A Debtor (1908) 1 KB 344.
re Pannowitz; ex parte Wilson 38 FLR 184, 6 ALR 287.
re Browbank; ex parte Loriplus Pty Ltd 12 FCR 254.
Penning v Steel Tube Suppliers Pty Ltd 18 FCR 568.
Director of Public Prosecutions v Kunz 43 FCR 374.
re Johnson; ex parte Johnson v Tonkin 123 ALR 607.
re Overseas Aviation Engineering (GB) Ltd (1963) Ch 24.
re Binstead; ex parte Dale (1893) 1 QB 199

re JUDITH EXELL; ex parte SUSAN MARTIN

No VP 622 of 1995

Olney J
Melbourne
20 December 1995

IN THE FEDERAL COURT OF AUSTRALIA
BANKRUPTCY DISTRICT OF THE
STATE OF VICTORIA No VP 622 of 1995

Re: JUDITH EXELL

Judgment Debtor

Ex parte: SUSAN MARTIN

Judgment Creditor

Coram: Olney J

Place: Melbourne:

Date: 20 December 1995

REASONS FOR JUDGMENT

On the hearing of the creditor's petition in this matter the debtor has raised by way of a preliminary issue the question of whether the judgment relied upon in the bankruptcy notice which is said to have given rise to an act of bankruptcy was "a judgment or order the execution of which has not been stayed".

Central to the matter in issue are the provisions of
s 40(1)(g) of the Bankruptcy Act 1996 which entitles a creditor to serve a bankruptcy notice in respect of -

a final judgment or final order, being a judgment or order the execution of which has not been stayed

and s 41(3) which provides:

S 41(3)A bankruptcy notice shall not be issued in relation to a debtor -

(a)except on the application of a creditor who has obtained against the debtor a final judgment or final order within the meaning of paragraph 40(1)(g) or a person who, by virtue of paragraph 40(3)(d), is to be deemed to be such a creditor;

(b)if, at the time of the application for its issue, execution of the judgment or order to which it relates has been stayed; or

(c) ...

THE JUDGMENT
On 22 July 1985 in action no 2420 of 1985 in the Supreme Court of Victoria, the judgment creditor (as plaintiff) obtained judgment in default of appearance against the judgment debtor for the sum of $58,750 and $340 costs.

On 7 July 1987 the judgment debtor filed a summons to have the judgment set aside but on 17 December 1987 Master Mahony dismissed the application with costs. However, the Master ordered that the judgment entered on 22 July 1985 be amended by the substitution of the sum of $54,250 for the sum…

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: [1995] FCA 1079
Decision Date: 20 DECEMBER 1995

CaseChat Overview and Summary

The parties involved in this case were Judith Exell, the bankrupt, and Susan Martin, the creditor. The dispute was centred on the enforcement of a judgment against the bankrupt. The Federal Court of Australia was the forum for this case. The creditor, Martin, sought to execute a judgment against Exell, who had been declared bankrupt. Martin applied for leave to execute the judgment despite the bankruptcy, as she was unable to issue a warrant of seizure and sale without the leave of the court.

The primary legal issue that the court had to decide was whether the execution of the judgment could proceed despite the bankruptcy, and if so, under what conditions. The court needed to consider whether the creditor had other forms of enforcement available and whether the execution of the judgment had been stayed. The court also had to balance the rights of the creditor to enforce their judgment against the protections afforded to the bankrupt under the Bankruptcy Act 1966.

The court held that the creditor could not proceed with the execution of the judgment without leave, given that a warrant of seizure and sale could not be issued. However, the court recognised that there were other forms of enforcement available to the creditor. The court considered the appropriate conditions for granting leave and decided that the execution of the judgment could proceed if certain conditions were met. These conditions included ensuring that the bankrupt's interests were protected and that the creditor's rights were not unduly prejudiced. The court ultimately granted leave for the execution of the judgment subject to these conditions.

The court's decision was that the creditor could proceed with the execution of the judgment, provided that the conditions outlined were satisfied. The court emphasised the importance of balancing the rights of creditors and the protections afforded to bankrupts under the Bankruptcy Act 1966. The final orders of the court required the creditor to comply with the conditions set out in the judgment before proceeding with the execution of the judgment against the bankrupt.

Orders