Rookharp Pty Ltd v Webb
[2012] FMCA 607
•5 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| ROOKHARP PTY LTD & ANOR v WEBB & ANOR | [2012] FMCA 607 |
| BANKRUPTCY – Creditor’s petition – no appearance of debtors at hearing – no grounds of opposition – sequestration order made. |
| Bankruptcy Act 1966 (Cth), s.52(1) |
| Rookharp Pty Limited v Webb & Anor [2011] FMCA 801 |
| First Applicant: | ROOKHARP PTY LTD |
| Second Applicant: | DAVID ROOKE |
| First Respondent: | IVAN JOHN WEBB |
| Second Respondent: | ELAINE THERESE WEBB |
| File Number: | SYG 2373 of 2011 |
| Judgment of: | Smith FM |
| Hearing date: | 5 July 2012 |
| Delivered at: | Sydney |
| Delivered on: | 5 July 2012 |
REPRESENTATION
| Counsel for the Applicants: | Mr B Skinner |
| Solicitors for the Applicants: | McLean & Associates |
| Counsel for the Respondents: | No appearance by or on behalf of the respondents |
ORDERS
A sequestration order be made against the estate of Ivan John Webb.
A sequestration order be made against the estate of Elaine Therese Webb.
The applicant creditors’ costs, including all reserved costs, be taxed and paid from the estates of the respondent debtors in accordance with the Bankruptcy Act 1966 (Cth).
Note that the date of the act of bankruptcy in relation to Ivan John Webb is 23 August 2011.
Note that the date of the act of bankruptcy in relation to Elaine Therese Webb is 22 August 2011.
Note that a consent to act as trustee in relation to the estates of both respondents has been signed by Alan Richard Nicholls.
The applicants must give a copy of this order to the Official Receiver within 2 working days.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2373 of 2011
| ROOKHARP PTY LTD |
First Applicant
| DAVID ROOKE |
Second Applicant
And
| IVAN JOHN WEBB |
First Respondent
| ELAINE THERESE WEBB |
Second Respondent
REASONS FOR JUDGMENT
(revised from transcript)
This is a creditor’s petition in which the present petitioners, Rookharp Pty Ltd and David Rooke, were substituted for the original petitioner, which was The Owners of Strata Plan No 51507. The original petition was lodged on 19 October 2011, and the original petitoner was given permission to withdraw by a Registrar on 1 February 2012. The present petitioners were then substituted by order of a Registrar on 15 February 2012. On that occasion, the two respondent debtors, Mr and Mrs Webb, were represented by counsel, and it is unclear to me whether they opposed the substitution. The motion for substitution was supported by an affidavit of debt which essentially foreshadowed the indebtedness now set out in the amended petition.
The substituted petitioners’ amended petition relies on the acts of bankruptcy asserted by the original petitioner, correcting some minor discrepancies. On the evidence which was previously filed and served on the debtors, I am satisfied as to due service of a valid bankruptcy notice on each of the debtors, and their failure to comply. The affidavits of service can be found attached to an affidavit of Ms Ackland sworn and filed on 19 October 2011. I am satisfied that an act of bankruptcy in relation to Mr Webb occurred on 23 August 2011, and an act of bankruptcy in relation to Mrs Webb occurred on 22 August 2011.
The debts relied upon in the amended petition, essentially derive from amounts owing under District Court judgments against Mr Webb on 11 September 2008 and against Mrs Webb on 8 October 2008, together with additional interest and costs, less some payments, plus some other litigation costs which are alleged to have been accepted under a deed signed by Mr and Mrs Webb. The deed is in evidence attached to an affidavit which is on the file sworn by Ms McLean on 29 March 2012. In her affidavit she also recounts a very long history of dealings between the petitioners and the debtors, including extensive litigation in the District Court and in this Court in relation to previous bankruptcy proceedings. I do not propose to set the history out in this judgment, and note that it can also be found in a judgment of Barnes FM in relation to a previous petition (see Rookharp Pty Limited v Webb & Anor [2011] FMCA 801).
Her Honour’s judgment addressed grounds of opposition raised by Mr and Mrs Webb to a petition brought only by Rookharp Pty Ltd, but based upon the same sources of indebtedness as the present amended petition. She upheld a ground of opposition which took issue with the absence of Mr Rooke as a joint creditor in the application for the bankruptcy notice relied upon in that petition. She did not accept other grounds of opposition, which raised issues as to the solvency of Mr and Mrs Webb, and also challenged their indebtedness to Rookharp Pty Ltd and Mr Rooke.
Her Honour noted, for example, at [122] that Mr and Mrs Webb appeared to concede that they owe amounts to Rookharp of at least $170,000. At [158], she found that they were indebted “for an amount of over $199,000”. She considered some arguments about inclusion of amounts in the petition, and declined to go behind the District Court judgments. She also said that arguments concerning the exact quantification of the debts would not lead to the dismissal of the petition, because “if these grounds of challenge were to be accepted, the amount of each judgment would not be reduced below a sum that was in excess of the minimum debt about on which a creditor’s petition could be based” (see [186]).
In the present matter, the debtors have not filed any grounds of opposition providing a relevant challenge to the present allegations of indebtedness made in the amended creditor’s petition, and these are verified by affidavits in accordance with the Bankruptcy Rules. The debtors have had more than ample opportunity to plead grounds of opposition and file evidence in support, but have not done so. The amended petition has been before the Court on numerous occasions before Registrars, and there have been contested adjournment applications. On at least two occasions, 16 March 2012 and 2 April 2012, Registrars gave precise directions for a timetable requiring the filing of a notice of opposition and evidence, and those timetables were not observed. This was at a time when the debtors were appearing from time to time in person or by counsel. On the last occasion they were represented by an experienced insolvency solicitor, Mr Ziman, who filed a notice of appearance on their behalf. Mr Ziman remains their solicitor on the record.
The matter subsequently was referred to me by a Bankruptcy Registrar on 21 May 2012, where the debtors appeared in person and by counsel. The creditors sought the immediate hearing of the petition, but I was unable to provide this, and fixed the matter for hearing today. I took the occasion to make further orders giving another timetable for a last opportunity for the debtors to file a notice of opposition and their evidence. However, no notice of opposition was filed in accordance with my direction that it be done “no later than 28 May 2012”, and no evidence was filed at all, whether before or after the date appointed.
The Court’s correspondence file indicates that a facsimile was received by the Registry on 29 May 2012, purporting to file a notice of opposition, which essentially appears to repeat contentions which were not accepted by Barnes FM in relation to the previous petition. However, that document was returned to the debtors by the Registry, on the grounds that it was out of time, and unsigned, and unsupported by evidence. No effort was made by the debtors to correct these deficiencies, nor to serve a copy of the document on the creditors, nor to take any further steps to obtain leave to present a defence to the petition today. They have not appeared today in person or by a legal representative. I am satisfied that they were on full notice that the matter was listed today, and that it would proceed in their absence if they were not here.
In all the circumstances, particularly the long history of the matter, I consider it appropriate to proceed with the petition on an undefended basis, and to make the orders sought in the amended petition.
I am satisfied by the evidence on the file that all the requirements of s.52(1) of the Bankruptcy Act 1966 (Cth) are complied with, as are other requirements of the Act and Rules. I am satisfied by an affidavit of debt filed today that the indebtedness relied on in the amended petition is established, at least to the extent that it relies upon an amount of $188,465.25 owing by Mrs Webb under a District Court judgment on 8 October 2008, and an amount of $187,881.19 owing by Mr Webb under a District Court judgment on 11 September 2008. It may well be that there are also additional amounts owing to the petitioners, but I think it appropriate to leave to the trustees of their bankrupt estates the determination of the exact amount owing to the present petitioners upon lodgement of appropriate proofs of debt.
The normal orders as to costs should be made.
I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Smith FM
Date: 11 July 2012
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