Re Tripodi, A v Ex parte Col Johnson Pty Ltd - [1987] FCA 7

Re: ARMANDO TRIPODI
Ex Parte: COL JOHNSON PTY. LIMITED
No. W219 of 1984X
Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION
BANKRUPTCY DISTRICT OF THE STATE OF NEW SOUTH WALES AND THE AUSTRALIAN CAPITAL TERRITORY
Burchett J.

CATCHWORDS

Bankruptcy - application under ss.222, 235 and 236 to void or terminate a deed of arrangement - Whether special resolution to terminate deed was passed - Whether it could be passed having regard to the terms of the notice of the meeting - Effect of statutory provision making minutes prima facie evidence - Requirement that termination of deed be resolved at a meeting "called for the purpose" - Whether deed uncertain - Omission of particular creditors from Statement of Affairs and omission to notify them of meeting at which execution of deed of arrangement was resolved - Errors in and omissions from Statement of Affairs - Discretion of the Court under s.222 - Effect of requirement for making of order that it be in the interests of the creditors to do so - Honesty of debtor and unlikelihood of further assets being recovered or order being made under s.131 for contribution - Relationship of ss.236 and 242 to s.222.

Bankruptcy Act 1966, ss.116(2)(b), 203, 222, 223A, 225(4), 235, 236.

Re Williamson; Ex parte Wearne (1980) 43 F.L.R. 305

Re Beames; Ex parte Beneficial Finance Corporation Limited (1985) 7 F.C.R. 216

Re Doukidis; Ex parte Consolidated Constructions Pty. Ltd., unreported, Toohey J., 26 June 1985.

Beard v. Prestige Baking Industries Pty. Ltd. (1981) 52 F.L.R. 384

Chiragakis v. Deputy Commissioner of Taxation, unreported, Fisher, Davies and Lockhart JJ., 11 July 1986.

Re Kleiss; Ex parte McDonough (1968) 15 F.L.R. 281

HEARING

SYDNEY

#DATE 22:1:1987

Counsel for the Debtor: Dr. G.A. Flick

Solicitors for the Debtor: Brown & Partners

Counsel for the Applicant: Mr. M.G. Skinner

Solicitors for the Applicant: Gillis Delaney

Counsel for the Official Trustee: Mr. J.R. Wilson

Solicitors for the Official Trustee: Lobban McNally & Harney

ORDER

The application be dismissed.

The applicant pay the costs of the Official Trustee.

There be otherwise no order as to costs.

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

JUDGE1

This is an application by a creditor to the Court for an order under s.222(2) of the Bankruptcy Act 1966 (the Act) in respect of a Deed of Arrangement made under the provisions of Part X. In the alternative, the applicant seeks, pursuant to s.235(b), an order declaring that the deed was terminated by a special resolution of creditors or, pursuant to s.236, an order of the Court terminating the deed. The applicant also seeks, in the event that an order is made under s.222 or the deed is terminated, a sequestration order against the estate of the debtor.

On or about 18 October 1984 the debtor, Mr. Tripodi, signed an authority under s.188 of the Act authorising one Lindsay Robert Aitken, who was then a registered trustee, to call a meeting of his…

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: [1987] FCA 7
Decision Date: 22 JANUARY 1987

CaseChat Overview and Summary

In the case of Re Tripodi, A v Ex parte Col Johnson Pty Ltd, the applicant sought to void or terminate a deed of arrangement under sections 222, 235, and 236 of the Bankruptcy Act. The dispute involved the validity of a special resolution passed to terminate the deed of arrangement and the procedural fairness in the handling of the meeting and associated documents. The Official Trustee, representing the creditors, opposed the application. The court was tasked with determining the validity of the special resolution, the adequacy of the notice of the meeting, and the effect of statutory provisions regarding the prima facie evidence of meeting minutes. Additionally, the court had to consider whether the deed of arrangement was uncertain and whether the debtor's omissions in the Statement of Affairs and notification to creditors justified voiding the deed.

The court examined the statutory requirements for passing a special resolution to terminate a deed of arrangement, focusing on whether the resolution was properly passed given the terms of the notice. It also evaluated the impact of the statutory provision making meeting minutes prima facie evidence. Furthermore, the court considered whether the deed was uncertain due to errors and omissions in the Statement of Affairs and the notification to creditors. The court's discretion under section 222 was scrutinized, especially the requirement that any order voiding the deed must be in the interests of the creditors. Factors such as the debtor's honesty, the likelihood of further asset recovery, and the potential for an order under section 131 for contribution were weighed. The relationship between sections 236 and 242 and their interplay with section 222 were also deliberated.

The court concluded that the application to void or terminate the deed of arrangement should be dismissed. It found that the special resolution was validly passed, the notice was adequate, and the statutory provisions did not undermine the resolution's validity. The court determined that the deed was not uncertain due to the errors in the Statement of Affairs, and the omissions did not justify voiding the deed. The court exercised its discretion under section 222, considering the interests of the creditors, the debtor's honesty, and the improbability of further asset recovery. The application was dismissed, and the applicant was ordered to pay the Official Trustee's costs, with no further orders as to costs.

Orders

Orders of the court

The application be dismissed.

The applicant pay the costs of the Official Trustee.

There be otherwise no order as to costs.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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