Re Ginnane, A Ex parte Diners Club Ltd

[1993] FCA 707

JUDGMENT No. ........ ".._.... ,,, ,,,,,,, 7 1 4 3

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IN THE FEDERAL COURT OF AUSTRALIA	)
VICTORIA DISTRICT REGISTRY	NO. VB 2384 of 1993

)

GENERAL DIVISION	)
B E T W E E N :

Re: ANTHONY GINNANE

A Debtor

Ex parte: DINER'S CLUB LIHITED

petitioning Creditor

JUDGE :	Heerey J
DATE :	10 September 1993
PLACE :	Melbourne

FEDERAL COURT OF

AUSTRALIA PRINCIPAL

REASONS FOR JUDGMENT REGISTRY

There was a sequestration order made against the debtor by Olney J on 30 August 1993. His Honour granted a 14 day stay. Under s.52(3) of the Bankruptcy Act 1966 (Cth) the court can grant a stay of up to 21 days.

However, the debtor on 9 September filed a Notice of Appeal against the sequestration order and now seeks a stay pending the hearing and determination of that appeal. It was accepted that I have a jurisdiction to order a stay under 0.52 r.17 of the Federal Court Rules, notwithstanding the terms of s.52(3):

purpose of s.43(l)(b)(i) of the Bankruptcy Act that at the

Evans v Heather Thiedeke Group Pty Limited (1990) 95 ALR 424 at 425.

The issue which was contested before his Honour and which will

be the subject of appeal is his Honour's finding for the

time when the act of bankruptcy was committed the debtor was "personally present or ordinarily resident in Australia". In Evans, Pincus J expressed the view that the decision in Ahearn

v Deputy Commissioner of Taxation (Queensland) (1987) 76 ALR

137

"... perhaps tends to support the view that where

there is a bond fide appeal challenging the existence of a debt, a stay of the sequestration order should fairly readily be granted."

The issue here is of course not the existence of the debt but another statutory pre-condition to the making of a sequestration order and clearly the same principle ought to apply

There was an attack made on the grounds in the notice of appeal which were said to be not of any substance. There was however no attempt by counsel for the respondent to deal with the notice of appeal in the context of Olney J's judgment.

All I can say is that the notice of appeal does specify	certain evidentiary grounds on which it will be contended that
his Honour erred. The requirement of being ordinarily resident in Australia raises questions of mixed fact and law. It is not a discretionary decision in itself and as such is open to the ordinary processes of appeal by way of re-hearing, in which the appeal court can draw inferences of fact with equal facility to the trial judge: Warren v Coombes (1979) 142 CLR 531.
I do not think I am in any position to make any predictions one way or the others as to the prospects of success of the appeal. As to whether it is bona fide in the sense that it is genuinely made for the purpose of challenging the sequestration order and not for some collateral purpose, there is nothing to suggest that it is not. There is, in the ordinary course of events, prejudice to an individual which follows merely from acquiring the status of a bankrupt. There is a further prejudice in the case of the debtor in that he wishes to carry on business in the United States which would be, at least, seriously impeded by the statutory requirements imposed on a bankrupt in relation to his books of account, passport, etcetera.
The respondent does not advance any particular ground of prejudice, such as, for example, the existence of property which the trustee might wish to recover urgently. So, in all the circumstances, I think it is appropriate to grant the
stay.
There was a separate basis on which a stay was sought, which related to a Part X meeting at which a proposed arrangement by the debtor was not accepted and in respect of which the debtor wishes to challenge some decisions of the chairman as to the admission of creditors to vote. I do not think I need to say anything about that separate basis.
I will order that the proceedings under the sequestration
order made by Olney J on 30 August 1993 be stayed until the hearing and determination of the appeal number VG 380 of 1993 instituted by notice dated 9 September 1993.
I order that the costs of this application be costs in the appeal.

I certify that this and the preceding three (3) pages are a true copy of the reasons for judgment of his Honour Mr Justice Heerey.

Associate

Counsel for the debtor:	Mr T Rodbard-Bean
Solicitor for the debtor:	Kliger Partners
Counsel for the petitioning	Mr R Mitchell
creditor:
Solicitor for the petitioning	Peter  Eggleston &

creditor:	Associates
Date of hearing:	10 September 1993

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FEDERAL COURT OF AUSTRALIA. 7

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Sonia Cornale
Federal Court of Australia
Principal Registry
Law Courts Building
Queens Square

SYDNEY NSW 2000

Dear Sonia,

Re:  G i ~ a n e v Diner's Club Limited

No. VB 2384 of 1993
Hutchins v Borden Australia Ptv Limited
No. VP 632 of 1993
Hutchins v Borden Australia Ptv Limited
No. VP 632 of 1993
McIntosch v Mocom Systems Ptv Limited
No. VG 310 of 1992
Wena v Minister for Immiaration
No. VG 294 of 1993
Ausino Ptv Ljmited v Servio Machine Tools

No. VG 171 of 1993

I enclose copies of judgments delivered by his Honour Mr

Justice Heerey in the above matters.
These judgments are not for general distribution.

Regards,

David ~rennan
Associate to Heerey J