Ribbera v Giasoumi
[2017] FCA 354
•5 April 2017
FEDERAL COURT OF AUSTRALIA
Ribbera v Giasoumi [2017] FCA 354
File number: VID 1234 of 2016 Judge: MURPHY J Date of judgment: 5 April 2017 Catchwords: PRACTICE AND PROCEDURE – Application for dismissal under r 30.21 of the Federal Court Rules 2011 (Cth) – failure to appear at hearing and failure to comply with orders – application granted Legislation: Sistrom v Urh (1992) 40 FCR 550 Cases cited: Bankruptcy Act 1966 (Cth)
Transfer of Land Act 1958 (Vic)
Date of hearing: 30 March 2017 Registry: Victoria Division: General Division National Practice Area: Commercial and Corporations Sub-area: General and Personal Insolvency Category: Catchwords Number of paragraphs: 29 Counsel for the Applicant: The Applicant did not appear Counsel for the Respondent: Mr J Kohn Solicitor for the Respondent: Dimos Lawyers ORDERS
VID 1234 of 2016 BETWEEN: CATHY RIBBERA
Applicant
AND: NICHOLAS GIASOUMI (IN HIS CAPACITY AS TRUSTEE OF THE BANKRUPT ESTATE OF PAUL RIBBERA)
Respondent
JUDGE:
MURPHY J
DATE OF ORDER:
30 MARCH 2017
THE COURT ORDERS THAT:
1.The proceeding be dismissed.
2.The Applicant pay the Respondent’s costs on an indemnity basis.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
MURPHY J:
In this proceeding the applicant, Cathy Ribbera, seeks a declaration that she is entitled to a greater than half share in the proceeds of the sale of a property located at 174A Gooch Street, Thornbury, Victoria of which she and her now bankrupt husband, Paul Ribbera, were the joint registered proprietors. The application is opposed by the respondent, Nicholas Giasoumi, in his capacity as trustee of the bankrupt estate of Mr Ribbera (the Trustee).
The proceeding was listed for hearing on 30 March 2017 and Mrs Ribbera did not appear. There is no question that she was aware of the hearing date. For the reasons I explain, it is appropriate to exercise my discretion to dismiss the application pursuant to r 30.21 of the Federal Court Rules 2011 (Cth) (the Rules.)
Mrs Ribbera represented herself in the proceeding, and it is appropriate to set out the relevant considerations in more detail than would otherwise be the case.
THE FACTS
I draw the following account of the facts from the Trustee’s affidavit sworn 14 December 2016 and the documents annexed thereto.
On 23 January 1984, Mrs Ribbera’s parents, Jim and Sofia Kerasovitis, became the registered proprietors of a property described as Lot 2 on Title Plan 83088F located in Gooch Street Thornbury (the Original Property). On or about 17 September 2003 Mr and Mrs Kerasovitis transferred the Original Property to Mr and Mrs Ribbera as a gift.
On or about 27 October 2003 the Original Property was subdivided into two lots:
(a)Lot 1 on Plan of Subdivision 518214T, Certificate of Title Volume 10760 Folio 171 (174A Gooch Street, Thornbury); and
(b)Lot 2 on Plan of Subdivision 518214T, Certificate of Title Volume 10760 Folio 172 (174B Gooch Street, Thornbury);
(the Gooch Street properties).
Since that date Mr and Mrs Ribbera have been the joint registered proprietors of the property at 174A Gooch Street, which (since 2 February 2004) is more particularly described as the property situated at Certificate of Title Volume 10780 Folio 570.
On or about 18 December 2003, Mr Ribbera transferred his interest in 174B Gooch Street to Mrs Ribbera for consideration of “natural love and affection”. She became the sole registered proprietor of that property.
The County Court proceeding
In 2013 a fuel provision company, Eagle Fuels Pty Ltd, brought proceedings in the County Court of Victoria against Slidecross Pty Ltd and Mr Ribbera. Mrs Ribbera was the director, secretary and shareholder of Slidecross. Eagle Fuels claimed, amongst other things, that Mr Ribbera gave a guarantee of $150,000 for repayment of debts that Slidecross owed to Eagle Fuels for fuel supplied to Mr Ribbera. The proceeding was dismissed against Slidecross and continued against Mr Ribbera only. He was unsuccessful in defending the proceeding and judgment was given against him on 14 May 2014, for $109,976 inclusive of interest plus costs agreed at $50,000. Mr Ribbera brought an appeal to the Court of Appeal of the Victorian Supreme Court but the appeal was dismissed.
The sale of the Gooch Street properties
By a written agreement dated 17 April 2014 between John and Rosemarie Morris (collectively Morris) as lender and Mr and Mrs Ribbera as borrowers, Morris made available to Mr and Mrs Ribbera a cash advance facility with a limit of $986,000. The loan was secured by registered mortgages over the Gooch Street properties dated 17 April 2014.
On 27 November 2014 a sequestration order was made against Mr Ribbera by the Federal Circuit Court and Mr Giasoumi was appointed as trustee of his bankrupt estate.
Mr and Mrs Ribbera defaulted on the loan agreement with Morris and on 29 June 2015 Morris issued proceedings against them for debt and possession of the Gooch Street properties. On 21 July 2015, Morris obtained a default judgment against Mr and Mrs Ribbera and subsequently the Gooch Street properties were sold.
Payment into the Supreme Court Common Fund
There were no surplus funds from the sale of 174B Gooch Street. The sum of $134,434.22, being the balance of the proceeds of the sale of 174A Gooch Street was paid into the Supreme Court of Victoria Common Fund.
On 17 March 2016, the Trustee filed an originating motion in the Supreme Court of Victoria seeking that half of the monies from the proceeds of the sale of 174A Gooch Street be paid to the Trustee. The basis for the Trustee’s application was that upon Mr Ribbera becoming bankrupt the joint tenancy of Mr and Mrs Ribbera in the property at 174A Gooch Street (the Property) was severed in equity and the Property was thereafter held on trust by Mrs Ribbera and the Trustee as tenants in common in equal shares.
THE APPLICATION TO THIS COURT
On 17 October 2016 Mrs Ribbera filed an Originating Application in this Court with an affidavit in support sworn 13 October 2016. The application was apparently drafted without the assistance of a lawyer but it made it clear enough that Mrs Ribbera sought a declaration that the Trustee was not entitled to half of the proceeds of the sale of the Property. Mrs Ribbera appeared to accept that the Trustee was entitled to an unspecified percentage share of the proceeds of the sale, but less than 50%.
Although prior to its sale Mr and Mr Ribbera were the joint registered proprietors of the Property, in the proceeding Mrs Ribbera claimed that she owned most of the Property as it was a gift from her parents. She pleaded (leaving the errors as they are):
The subject property was jointly owned in names only. We had a verbal agreement between myself, Paul Ribbera and my parents that my share would be more than 50% interest due to the fact that my parents gifted us the property. Most important, I take care of my brother in the future, whom has disabilities. This was not to be as Paul used more than his share on legal costs believing he would succeed with the support of my parents.
The questions in the proceeding were:
(a)whether Mrs Ribbera held the proceeds of sale of the Property on trust for the Trustee; and
(b)whether Mrs Ribbera has a greater than 50% interest in the Property.
Procedural history
The application came on for a first case management hearing on 25 November 2016, at which I told Mrs Ribbera that, in my preliminary view, the affidavit in support that she had filed was insufficient to substantiate her claim. I made orders that:
(a)Mrs Ribbera file and serve all affidavits upon which she intended to rely by 27 January 2017;
(b)the Trustee file and serve any affidavit material in response by 17 February 2017;
(c)the matter be referred to mediation as soon as practicable after 27 January 2017; and
(d)in the event the proceeding did not settle at mediation the matter be listed for hearing on 27 March 2017.
The proceeding did not settle at mediation and I conducted a further case management conference on 1 March 2017. Mrs Ribbera did not file an affidavit of substance in response to the orders of 25 November 2016. I again told Mrs Ribbera that in my view, in the absence of better evidence, her application was likely to fail. I made orders extending the time for her to file and serve any further affidavit upon which she intended to rely to 14 March 2017 and to file written submissions on that same date. She did not file any further affidavit material or any written submissions.
On 27 March 2017, two clear days before the date of trial (which had been moved 30 March 2017) the registry received an unsigned document (the 27 March letter) from Mr Ribbera. The letter said that Mrs Ribbera suffered from a psychological condition for which she had regular medical attention. It said she was anxious because she had been unprepared for the last case management conference and had been unable to comply with the orders, and then said:
· The Applicant has today attended her Doctor and has been prescribed medications;
· The Applicant’s Doctor requests, that the Applicant be given an extension in time on the Court Orders and a change of Trial Date. The Doctor will provide a letter to the Court upon request only;
…Please contact me on [phone number] if you require anything further.
When the case was called on the morning of 30 March 2017 Mrs Ribbera did not appear. I stood the matter down to allow her further time, but she did not appear when the matter was recalled. She has not contacted chambers since then seeking to explain her non-appearance.
CONSIDERATION
Rule 30.21(1) of the Rules provides that if the applicant is absent when a proceeding is called on for trial another party may apply to the Court for an order that the proceeding be dismissed. The Trustee sought dismissal of the proceeding and I decided such an order was appropriate in the circumstances.
I did so, first, because Mrs Ribbera failed to appear when the matter was called on for hearing. Second, she failed to comply with the orders of 25 November 2016 and 1 March 2017 by failing to file affidavit material to substantiate her claim. She failed to prosecute the proceeding with appropriate diligence.
Third, the 27 March letter is not a proper application for an adjournment. Amongst other things, the letter:
(a)is from Mr Ribbera. He is not a party, is not legally qualified and he cannot act for Mrs Ribbera in the proceeding;
(b)is not an application for an adjournment in proper form and it was not served on the Trustee. It was not the Court’s task to seek a proper application;
(c)sought an adjournment on the basis of an allegedly incapacitating psychological condition without any supporting medical evidence; and
(d)only gave Mr Ribbera’s account of his wife’s mental state. He is neither independent nor medically qualified and his account can be given little weight.
I have given judgment based on Mrs Ribbera’s failure to appear, but I am confirmed in that view by the fact that I see no proper basis for Mrs Ribbera’s claim.
It is common ground that Mr and Mrs Ribbera were the joint registered proprietors of the Property prior to its sale. In Victoria, if two or more persons are registered as joint proprietors of an estate or interest in land, they are deemed to be hold title as joint tenants: see s 30(2) of the Transfer of Land Act 1958 (Vic).
Section 58(1)(a) of the Bankruptcy Act 1966 (Cth) provides:
Subject to this Act, where a debtor becomes a bankrupt…the property of the bankrupt, not being after-acquired property, vests forthwith in the Official Trustee or, if, at the time when the debtor becomes a bankrupt, a registered trustee becomes the trustee of the estate of the bankrupt by virtue of section 156A, in that registered trustee.
Where a bankrupt and another person are registered as joint tenants of land, s 58 effects a severance of the joint tenancy in equity and imposes an obligation on the registered proprietor to hold the land on trust for the trustee in bankruptcy and him/herself as tenants in common in equal share: Sistrom v Urh (1992) 40 FCR 550 at 556 (Davies, Ryan and von Doussa JJ).
There is no cogent evidence to indicate that Mr Ribbera’s interest as joint tenant was less than an equal share. The material goes no further than a broad claim that there was a verbal agreement between Mr and Mrs Ribbera and her parents that Mrs Ribbera’s share would be more than 50%. It is unclear how Mrs Ribbera proposed to establish her case.
COSTS
The Trustee sought an order for costs on an indemnity basis. In my view such an order is appropriate. Mrs Ribbera has brought meritless proceedings, although ordered to do so on several occasions she has failed to file affidavit evidence to support her claim, she has not complied with orders of the Court, and she failed to appear at the hearing. The creditors of Mr Ribbera’s bankrupt estate will face a significant shortfall in recoverable costs unless an order is made on an indemnity basis in favour of the Trustee. I can see no good reason why the creditors should carry the burden of the costs of such a proceeding, conducted in the way that it was.
I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy. Associate:
Dated: 5 April 2017
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