Rosenblum, Rupert George v Wily, Hugh Jenner

[1997] FCA 1528

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 7952 of 1997

BETWEEN:	RUPERT GEORGE ROSENBLUM APPLICANT
AND:	HUGH JENNER WILY RESPONDENT

JUDGE(S):	BRANSON J
DATE:	16 DECEMBER 1997
PLACE:	SYDNEY

REASONS FOR JUDGMENT (EX TEMPORE)

The applicant has applied to the Court for review of the decision of the respondent (“the trustee”) to reject a proof of debt.  The trustee has applied for summary dismissal of the application for review.   It is the application for summary dismissal of the applicant’s application with which I am presently concerned.

Section 84 of the Bankruptcy Act 1966 (Cth) (“the Act”) provides for the method of proving debts and s 90 of the Act makes particular provision with respect to the proof of debts by secured creditors.

The applicant lodged with the trustee a proof of debt dated 19 April 1996 which proof complied with s 84 of the Act. The proof of debt dated 19 April 1996 asserted that the applicant held no security. It was thus not a proof of debt by a secured creditor who seeks to prove for the balance due to him or her after deducting the estimated value of the security, (ss 90(4) and (5)). The trustee gave notice dated 24 July 1997 of his rejection of the proof of debt dated 19 April 1996 (see s 102(1)).

By letter dated 5 August 1997, the solicitors for the applicant advised the trustee that the applicant may hold security from the debtor. Enclosed with that letter was a document purporting to be an amended proof of debt. It required to be read with the proof of debt dated 19 April 1996; it did not itself contain all of the information required to constitute it a proof of debt under the Act.

Section 98 of the Act provides that a creditor may, with the consent of the trustee, amend a proof of debt lodged by him or her. It has not been suggested in this case that the trustee has given his consent to any amendment to the proof of debt dated 19 April 1996. However, by letter dated 7 August 1997, the trustee indicated to the applicant's solicitors that he would be prepared to adjudicate upon a fresh proof of debt lodged by the applicant. By an application dated 12 August 1997, filed on 13 August 1997, the applicant applied to the Court to review the decision of the trustee to reject the proof of debt. The proof of debt which the affidavit supporting the application identifies as having been rejected by the trustee was that dated 19 April 1996.

No other proof of debt of the applicant had at that stage, or indeed has even now, been rejected by the trustee. By a form of proof of debt dated 13 August 1997, the applicant identifies himself as a secured creditor and, as required by s 90(5) of the Act, states in the proof of debt particulars of his security, and the value at which he estimates it. It is not suggested that the trustee has adjudicated upon this proof of debt although, from letters written by him, it may be assumed that when he does he may reject it. It is the form of proof of debt dated 13 Augustl 1997 that the applicant seeks to have considered by the Court.

The trustee has applied, under O 20 of the Federal Court Rules, for summary dismissal of the applicant’s application on the basis that the proof of debt dated 13 August 1997 has not been rejected by the trustee. The applicant opposes summary dismissal of his application on the ground that only one proof has been lodged with the trustee, albeit that it has been amended. It is to be noted that no proof of debt of the applicant has been amended in accordance with the Act; no consent of the trustee to any amendment has been established. In any event, even if the applicant’s proof of debt of 19 April 1996 may be considered as a proof of debt amended by the form of proof of debt dated 13 August 1997, it has not been rejected by the trustee in its amended form.

It may be that the rejection by the trustee of the form of proof of debt of 13 August 1997, whether seen as a fresh or an amended proof of debt, is likely in the circumstances. Nonetheless, the role of the Court under s 104 of the Act is to review a decision of the trustee. No decision of the trustee on the form of proof of debt of 13 August 1997 was in existence at the date of the application, or indeed exists today. The power of the Court, if any, to allow the amendment of the applicant's proof of debt has no relevance in such circumstances to the present application.

In reliance on O 20 r 2 of the Federal Court Rules, the applicant’s application is dismissed.

I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Branson

Associate:

Dated:            16 December 1997

Counsel for the Applicant:	Mr P. Brereton
Solicitor for the Applicant:	Pryor Tzannes & Wallis with Murphy & Moloney
Counsel for the Respondent:	Mr D. Durston
Solicitor for the Respondent:	Michell Sillar
Date of Hearing:	16 December 1997
Date of Judgment:	16 December 1997