Re Lofts, David John Ex Parte Johnson, Andrew William - [1997] FCA 580

IN THE FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
  No QG 7197 of 1997
BANKRUPTCY DISTRICT OF THE
STATE OF QUEENSLAND

RE:DAVID JOHN LOFTS
EX PARTE:ANDREW WILLIAM JOHNSON
Applicant
DAVID JOHN LOFTS

Respondent

CORAM:       Spender J
PLACE:         Brisbane
DATE:  24 June 1997

MINUTES OF ORDER

THE COURT ORDERS THAT:

Lynette Maria Addison be substituted as petitioning creditor in petition No 7197 of 1997.

The hearing of the petition be adjourned to 28 July 1997.

The costs of the application for substitution of petitioning creditor be reserved.

The application by Mr G M Smith to be substituted as petitioning creditor be adjourned to Friday, 11 July 1997.

The costs of today in relation to the application by Mr G M Smith to be substituted as petitioning creditor be reserved.

THE COURT DIRECTS THAT:

Any further material on behalf of Mr G M Smith be filed and served by 4 pm on Wednesday, 2 July 1997.

Any affidavit material by Mr Lofts in reply to the application for Mr Smith to be substituted as petitioning creditor be filed and served by Wednesday, 9 July 1997.

Note:Settlement and entry of orders is dealt with in Rule 124 of the Bankruptcy Rules.

IN THE FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
  No. QG 7197 of 1997
BANKRUPTCY DISTRICT OF THE
STATE OF QUEENSLAND

RE:DAVID JOHN LOFTS
EX PARTE:ANDREW WILLIAM JOHNSON
Applicant
DAVID JOHN LOFTS

Respondent

CORAM:       Spender J
PLACE:         Brisbane
DATE:  24 June 1997

REASONS FOR JUDGMENT

I am presently dealing with an application that Lynette Maria Addison be substituted as petitioning creditor against David John Lofts. A further application that a Mr G.M. Smith be substituted as a petitioning creditor seems to me to have been the subject of material filed very late and which in justice I ought not to consider at this time.

Insofar as the application on behalf of Lynette Maria Addison is concerned, she asserts that she entered into an agreement with Mr Lofts to repay to her the sum of $12,500.00 which she paid to a company, Oz Trade Limited (‘Oz Trade’). She claims that the debt is evidenced by the contents of an agreement in writing dated 27 December 1995. The parties to the agreement are specified in the recitals as Oz Trade, Lynette Maria Addison and Leslie James Addison.

The second paragraph immediately above the execution sections in the agreement is in the following terms:
“ Oz Trade and David Lofts agree to return the investment to the contributor within 30 days after notice in writing requesting same, provided the Contributor has not received any moneys from the project.”

The document is then signed David J. Lofts, under which appears:

“ Signed by Oz Trade through its duly appointed Australian representative, David John Lofts, in the presence of...”

and a witness's name and a date appears. I note the date is different from the typewritten date which appears at the top of page 1 of the agreement. The two signatures of Mr and Mrs Addison also appear,…

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: [1997] FCA 580
Decision Date: 24 Jun 1997

CaseChat Overview and Summary

This case involved an application for substitution of petitioning creditor in a bankruptcy petition against David John Lofts. The applicant, Andrew William Johnson, sought to have Lynette Maria Addison substituted as the petitioning creditor. Another application to substitute a different creditor, G M Smith, was also made but was considered too late to be considered by the court. The primary issue before the Federal Court of Australia, under the Bankruptcy Act, was whether Lynette Maria Addison could be substituted as the petitioning creditor against David John Lofts. This hinged on whether she could establish a debt owed by Lofts, as per the agreement dated 27 December 1995, and whether she had fulfilled the conditions to request repayment.

The court examined the agreement, which specified that Oz Trade and David Lofts agreed to return the investment to the contributor within 30 days after a written notice, provided the contributor had not received any moneys from the project. Lynette Maria Addison claimed she had given such notice and that no payment was made. David Lofts disputed this, asserting that there was no personal obligation on him to repay the money and that he never agreed to do so either orally or in writing. The court held that the material presented by Lynette Maria Addison was sufficient for the court to substitute her as the petitioning creditor, reserving the question of costs. The court also directed the filing deadlines for further material from both parties and adjourned the hearing of the petition. The application by G M Smith was similarly adjourned with reserved costs.

Orders