Richman v Australia Bank

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I N THE FEDERAL COURT OF AUSTRALIA )

GENERAL DIVISION )
BANKRUPTCY DISTRICT OF THE STATE )

OF NEW SOUTH WALES AND THE ) No. P .2483 of 1987

AUSTRALIAN CAPITAL TERRITORY )

- RE:

ROBERT A. RICHMAN
D e b t o r
EX PARTE:
AUSTRALIA BANK
C r e d i t o r

EXTEMPORE REASONS FOR JUDGMENT

BURCHETT J.

I n t h i s matter t h e c r e d i t o r r e l ies o n s . 4 0 ( l ) ( h ) of t h e

B a n k r u p t c y Act 1 9 6 6 . T h e d e b t o r , w h o a p p e a r s i n p e r s o n , h a s

o b t a i n e d l e g a l a d v i c e , b u t h a s n o t f i l e d a n y n o t i c e o f

o p p o s i t i o n . He h a s n o t o f f e r e d e v i d e n c e , b u t h e h a s . i n f o r m e d t h e

C o u r t t h a t h e does n o t c o n c e d e t h e a m o u n t o f t h e d e b t , t h o u g h h e

d o e s s a y , " I f e e l I d o owe some l a r g e a m o u n t . "

O n t h e e v i d e n c e , t h e p r o p e r c o n c l u s i o n t o r e a c h is t h a t

t h e p e t i t i o n h a s b e e n m a d e o u t . T h e d e b t o r d i d n o t u s e t h e

l a n g u a g e o f p a r a g r a p h (h) , b u t i n s u b s t a n c e w h a t h e s a i d was

c l e a r l y t o t h e e f f e c t s p e c i f i e d i n t h a t p a r a g r a p h . T h i s is

s u f f i c i e n t upon t h e a u t h o r i t i e s , a m o n g w h i c h i t i s e n o u g h t o

r e f e r t o Re Hewson; Ex p a r t e S y d n e y S t o c k E x c h a n g e L i m i t e d ( 1 9 6 7 )

10 F.L.R. 479 , and p a r t i c u l a r l y t o w h a t G i b b s J . , a s h e t h e n was,

s a i d a t p a g e s 4 8 3 t o 4 8 4 .

2.

Accordingly I propose to make a sequestration order. I

am satisfied that the debtor has committed the act of bankruptcy alleged in the petition. I am satisfied of proof of the other matters of which s.52(1) of the Act requires proof. I note that Max Christopher Donnelly, a registered trustee, has consented to act as the trustee of the estate of the debtor. I make a sequestration order against the estate of the debtor. I order that costs including reserved costs, and any costs of the motion under s.50 which has been rendered otiose by my proceeding to hear the petition today, be taxed and paid according to the Act. I direct that a draft of this order be delivered to the Registrar

within seven days in accordance with rule 124(2).

I certify that this and the

preceding page are a true copy
of the Reasons for Judgment

herein of his Honour Mr.
Justice Burchett.
Associate

Dated: 14 December, 1987.

CaseChat Overview and Summary

In the case of Richman v Australia Bank, the debtor, Robert A. Richman, was being pursued by the creditor, Australia Bank, under section 40(1)(h) of the Bankruptcy Act 1966. The dispute arose from an alleged act of bankruptcy where Richman did not oppose the creditor's petition and failed to provide any evidence in his defence. The creditor sought a sequestration order, which would declare the debtor bankrupt and appoint a trustee to manage the debtor's assets.

The central legal issue before the court was whether the evidence presented by the creditor was sufficient to establish that Richman had committed an act of bankruptcy, as defined by the Act. Additionally, the court needed to determine if the requirements of section 52(1) of the Act, which outlines the proof necessary for a sequestration order, were satisfied. Richman, although represented by legal counsel, did not file a notice of opposition and did not provide any evidence to contest the claim. Instead, he acknowledged owing a substantial debt but did not concede the exact amount claimed by the creditor.

The court found that Richman's acknowledgment of owing a significant debt was sufficient to meet the criteria of section 40(1)(h) of the Act. Although Richman did not explicitly use the language of the statute, his statements in substance aligned with the requirements. The court referred to precedents, including the case of Re Hewson; Ex parte Sydney Stock Exchange Limited, to support its conclusion. Justice Burchett was satisfied that Richman had indeed committed an act of bankruptcy and that the other statutory requirements were fulfilled. Consequently, the court made a sequestration order against Richman's estate and appointed Max Christopher Donnelly as the trustee. Costs, including reserved costs and those associated with a previously filed motion, were ordered to be paid according to the Act.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

c l e a r l y	t o t h e e f f e c t	s p e c i f i e d	i n	t h a t	p a r a g r a p h .	T h i s	is
s u f f i c i e n t upon	t h e	a u t h o r i t i e s ,	a m o n g	w h i c h	i t	i s e n o u g h	t o
r e f e r t o Re	Hewson;	Ex p a r t e	S y d n e y	S t o c k	E x c h a n g e	L i m i t e d	( 1 9 6 7 )

within seven days in accordance with rule	124(2).
I	certify that this and the
preceding page are a true copy