Re Lewin and Glasson; Ex parte Milner

Re: MORRIS WALTER LEWIN; ROGER McMILLAN GLASSON
Ex Parte: BRYAN JOHN MILNER
No. NSW P471 and P464 of 1986
Bankrutcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION
BANKRUTCY DISTRICT OF THE STATE OF NEW SOUTH WALES
Pincus J.

CATCHWORDS

Bankruptcy - creditor's petition - appeal against judgment on which bankruptcy notice founded - prospects of success on appeal - proper test as to whether petition adjourned pending appeal - attempts to place assets beyond reach of credits.

Bankruptcy Act, 1966,ss.33(1)(a); 52(3)

Trade Practices Act, 1974, s.52

HEARING

BRISBANE

#DATE 24:4:1986

For the applicants: Mr. F.G. Lever instructed by Harris, Hosie & McGarvey

For the respondents: Mr. R.S. Hulme QC with Mr. Moore instructed by Schrader, Coyle & Associates

ORDER

As to each petition:

I make a sequestration order against the estate of the debtor and order that the petitioning creditor's costs of and incidental to this petition be taxed and paid in accordance with the Act.

NOTE: Settlement and entry of orders is dealt with in Order 36

of the Federal Court Rules.

JUDGE1

The petitioning creditor in these two matters, which were heard together, seeks a sequestration order in respect of the estates of the judgment debtors, Dr. Lewin and Mr. Glasson. In each case the bankruptcy notice relies on a judgment for damages which, together with interest, amounted to $54,552.20 as at 25 February 1986. The reasons for judgment are reported in 61 A.L.R. 557; the case concerned a large guava project.

1. The judgment in question was entered by order of Lockhart J. made on 17 December 1985 in proceedings brought under s.52 of the Trade Practices Act 1974. Lockhart J. heard, with the application brought by the petitioning creditor (no. G164 of 1982), another application brought by many applicants against the judgment debtors (no. G85 of 1983). Although the petitioning creditor relies, of course, only on the judgment in his favour, the amount of the liabilities of the judgment debtors under the orders of Lockhart J. in G164 of 1982 and G85 of 1983, including costs, is said to be in the vicinity of $2.5 million. The judgment debtors applied for a stay of execution, but failed to obtain one beyond 21 January 1986. On 28 February 1986 I granted orders restraining dealings in property by Dr. Lewin and others, under the Mareva principle.

2. The judgment debtors argue that no sequestration order should be made because an appeal has been lodged against the orders of Lockhart J. The judgment debtors are, as I find, actively taking steps in prosecution of the appeal. Their counsel argues that, in accordance with certain authorities to be referred to, the proper course is to adjourn the bankruptcy petitions until the appeals in these matters are disposed of. It is also contended that the Mareva orders should be varied to provide for the debtors' costs of the appeal.

3. It is argued on behalf of the petitioning creditor, on the other hand, that the judgment debtors have no prospect of eliminating…