Re Udowenko; Ex parte Mitchell

The case of Re Udowenko; Ex parte Mitchell involved a bankruptcy notice issued against Michael, Helen, and Wolodymyr Udowenko by Alan Bernard Mitchell. The notice was served on 21 March 1996, and it allowed a 21-day period for compliance, which was subsequently extended multiple times. However, the Udowenkos did not comply with the notice by the extended deadline of 4 June 1996, leading to a creditor's petition being filed against them. The Udowenkos then applied to the Federal Court to extend the time for compliance with the bankruptcy notice and to set it aside.

The legal issues before the court were whether the Udowenkos had committed an act of bankruptcy by failing to comply with the notice, and if the court had the jurisdiction to extend the time for compliance with the bankruptcy notice after the time had expired. The court had to determine whether the statutory power to extend time was limited to cases where a proceeding to set aside the judgment or the bankruptcy notice itself was instituted or filed before the expiration of the compliance time, and if so, whether this power existed when such proceedings had been dismissed or otherwise ceased to be current.

Justice Lindgren held that the court did not have the power to extend the time for compliance with the bankruptcy notice. The statutory power to extend time was contingent upon a proceeding or application to set aside the judgment or the bankruptcy notice being instituted or filed before the expiration of the compliance time and still subsisting at the time when the occasion for exercise of the power to extend time arises. Since the application to set aside the bankruptcy notice was dismissed before the compliance time expired, the condition of the existence of the power to extend time was not satisfied. Additionally, the court noted that even if it had the power to extend time, it would not exercise it in the circumstances of this case.

The court dismissed the Udowenkos' application for an extension of time and ordered them to pay the costs of the hearing on 1 October 1996. The application to set aside the bankruptcy notice and the creditor's petition were listed for further directions.