Re Reeve, Ernest Robert Provan Ex Parte Westpac Banking Corp

[1996] FCA 440

CATCHWORDS

BANKRUPTCY - application to set aside bankruptcy notice - counter-claim set off or cross demand - matters could have been raised in earlier proceedings - no reason for doubting validity of judgment

Bankruptcy Act 1966 s 40(1)(g)

Adamopoulos & Anor v Olympic Airways (SA) & Anor (1990) 95 ALR 525 Refd

Re Ernest Robert Provan Reeve, ex parte:  Westpac Banking Corporation
No QN 574 of 1996

Kiefel J  Brisbane 27 May 1996

IN THE FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
BANKRUPTCY DISTRICT
OF THE STATE OF QUEENSLAND  No. QN 574 of 1996

RE:ERNEST ROBERT PROVAN REEVE

Applicant

EX PARTE:WESTPAC BANKING CORPORATION

Respondent

JUDGE MAKING ORDER:        Kiefel J.

DATE OF ORDER:  27 May 1996

WHERE MADE:  Brisbane

MINUTES OF ORDERS

THE COURT ORDERS THAT:

1. The application be dismissed with costs.

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

IN THE FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
BANKRUPTCY DISTRICT
OF THE STATE OF QUEENSLAND  No. QN 574 of 1996

RE:ERNEST ROBERT PROVAN REEVE

Applicant

EX PARTE:WESTPAC BANKING CORPORATION

Respondent

CORAM:  Kiefel J.

DATE:  27 May 1996

PLACE:  Brisbane

REASONS FOR JUDGMENT

Mr Reeve applies to set aside a bankruptcy notice which issued on 1 April 1996 and which was founded on a judgment in the sum of $3,638,028.17 entered against him in favour of Westpac Banking Corporation in the Supreme Court of Queensland on 7 March 1996. 

That order followed the hearing of the bank's application for summary judgment in respect of which Mr Reeve had delivered a defence which appears to have been prepared by him and without legal representation and which he unsuccessfully sought to pursue.  In it he made two claims which might be considered as potential matters of
counter-claim, set off or cross demand.  He alleged that the bank failed to obtain securities before it advanced monies to him as it had promised to do, and that the bank failed to advise him about unspecified matters relating to a bill transaction in foreign currency.  He had not, however, converted these allegations to a claim for money and says that he was not permitted to do so.  That is, in any event, the effect of the order made.

Mr Reeve has appealed from that decision and, indeed, when the matter came before me, it was sought on his behalf to have the proceedings on the bankruptcy notice adjourned generally to permit the matters raised on the appeal to be determined. It must be observed, however, that the appeal could not resolve any matter relevant to the bases put forward for the bankruptcy notice being set aside, namely that there is or was a counter-claim, set off or cross demand that could not have been raised in the proceedings leading to judgment, see s 40(1)(g) Bankruptcy Act 1996.  It would conclude that there indeed may have been if the bases for the defence were made out.  In any event, the two matters raised in the defence were clearly matters which could have been so raised in those proceedings. 

With respect to the judgment otherwise, the correctness of it is put in issue, but no basis has been shown for doubting its validity or for inferring that there has been any miscarriage of justice, save by reference to the fact of the appeal.  That appeal is limited to the first-mentioned ground of defence, namely the failure to fulfil what has been described as a condition precedent to the advance of monies.  I do not have before me the reasons for judgment but their absence, said to be on account of their unavailability, does not assist the
applicant. All that is then pointed to are grounds of defence, absent detail and verification, which were not accepted and which do not have any obvious merit.  In argument, and by reference to material filed by the bank, it was said that the complaint was that the securities in question were obtained, but only after the monies were advanced and not before.  One might query how this could sound in any loss, as was implied in the defence or for present purposes and more relevantly, how it could prevent a debt arising.  The terms of the bank's letter of offer relied upon do not disclose it as having this effect, although it was not the subject of any detailed submissions before me. 

The view I have taken of the matter relating to the appeal will not prevent the question of its outcome, if it still be on foot, being properly raised on the hearing of the petition which is to say on affidavit material and by reference to full submissions.  Although, as I have said, it is not apparent to me how the applicant might satisfy the Court, even at that point, that the dispute the subject of the appeal is genuine in the sense that it is fairly arguable:  see Adamopoulos & Anor v Olympic Airways (SA) & Anor (1990) 95 ALR 525 at 531.

The other matter relied upon to set aside the notice is also without merit.  Reference was made to proceedings brought by the applicant's mother and a company against the bank and against Mr Reeve.  In those proceedings, it is claimed that Mrs Reeve ought to be relieved of the consequences of signing some documents in respect of which execution Mr Reeve played a part.  The proceedings do not, however, involve any claim by Mr Reeve against the bank. 

The application is dismissed with costs.

I certify that this and the preceding three pages are a true copy of the reasons for judgment herein of the Honourable Justice Kiefel.

Associate

Date:27 May 1996

Counsel for the applicant:  Mr J Moore

Solicitors for the applicant:  Biggs & Biggs Town Agents for Groom & Lavers

Counsel for the respondent:  Mr R Derrington

Solicitors for the respondent:  Corrs Chambers Westgarth

Date of Hearing:  27 May 1996

Place of Hearing:  Brisbane

Date of Judgment:  27 May 1996