Re: Hawkins; Ex Parte: Deputy Commissioner of Taxation v Hawkins

[1995] FCA 1195

JUDGMENT No. /Lzi,'J /Z.Z

IN THE FEDERAL COURT OF AUSTRALIA )

GENERAL DIVISION	)	NO. NI[ 146 of 1994
BANKRUPTCY DISTRICT	1
OF THE STATE OF NEW SOUTH WALES	)

Re t JOHN CAMPBELL HAWKINS

Debtor

Between: DEPUTY COMMISSIONER OF

TAXAT ION

Applicant/Creditor

And : JOHN CAMPBELL HAWKINS

First respondent

FEDERAL COURT And : RODERICK GERARD CUNICH

OF AUSTRALIA Second respondent

t l J A N 2003

' 0 LIBRARY

REASONS FOR JUDGMENT

EINFELD J SYDNEY 10 APRIL 1995

The first respondent is a debtor against whom a sequestration order has been made but temporarily stayed. He seeks an order that the sequestration order be further stayed pendingthe filing of a notice of appeal against the decision given on 30 March. Draft grounds of appeal have been presented, and it says nothing about the quality of the appeal or its chances of success to say that the appeal must in all but one respect appear to be weak. There is certainly an arguable ground in relation to the voting for BAS Finance Pty Limited and there seems no reason why the debtor should not have the opportunity of pursuing that appeal if he wishes to do so.

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It may be several months before this appeal can be heard and disposed of. The debtor has filed no evidence as to any hardship if the sequestration order takes effect. Indeed, it is admitted today, as was verified by affidavit evidence during the hearing, that the debtor has no assets and has no directorships or other financially rewarding or asset holding activities which would be affected by the sequestration order. Accordingly, this application for a stay comes down to the simple fact that the debtor does not wish to be a bankrupt.

In the ordinary course, sequestration orders should come into effect as soon as they are made or as soon thereafter as is consistent with the interests of justice. I stayed the sequestration order until today sothat the debtor could consider the effect of the judgment earlier given and obtain advice as to what steps he should now take. In answer to the debtor's lack of demonstrated hardship, the creditor argues that the sequestration order should take effect and the affairs of the debtor should be placed under administration. Otherwise debtors will always feel that the making of a sequestration order can be delayed without specific grounds pending an appeal.

As I am informed today, the debtor has taken on board that if he is made bankrupt and it takes six months from now until the disposition of the appeal, that six months will count in the period of bankruptcy and he will be that much closer to discharge. Nonetheless, he seeks to delay the coming into effect

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of the sequestration order pending the decision of the Full

Court.

It is my opinion that the debtor has made out no grounds at all for a delay of the sequestration order. It cannot be that the mere filing of a notice of appeal, unless on very strong or overwhelming grounds, could form a basis for a stay of a sequestration order. As it seems to me, the orders of Courts will normally take effect as soon as they are made or as soon as the rules of court have been complied with that bring them into effect. Delay should only take place where it can be demonstrated that a hardship or some form of irreversible or powerful prejudice will occur if the stay is not granted.

These circumstances do not exist in this case. I therefore refuse the stay sought, but nothing that I have said should be taken as interfering with the right of a Full Court to grant a stay after the notice of appeal has been filed. The application for a stay pending the appeal of the sequestration order is refused.

Anything else?

[After discussion]

The debtor will pay the creditor's costs of the application.

i I certify that this and the 2

I preceding p::~cs ar$ a true copy of the

Reasons for ,.l!idgrnent iiereiil of his Honour

Justice Einfold

Associate MA*

( Dated: X L / Z - / ~ L 1