Savva v The Owners - Strata Plan No 79419 - [2012] FMCA 753

FEDERAL MAGISTRATES COURT OF AUSTRALIA

SAVVA v THE OWNERS – STRATA PLAN NO 79419

[2012] FMCA 753

BANKRUPTCY – Application to review decision of Registrar and set aside sequestration order.

Bankruptcy Act 1966 (Cth), s.52
Federal Magistrates Act 1999 (Cth), s.104

Catterick v Owners Corporation PS302189T and Catterick v Owners Corporation PS302189T & Anor [2011] FMCA 694
Cave v Madgwicks (a firm) & Anor [2010] FMCA 878

Applicant:

GEORGE SAVVA

Respondent:

THE OWNERS – STRATA PLAN NO 79419

File Number:

SYG 1736 of 2012

Judgment of:

Barnes FM

Hearing date:

13 August 2012

Delivered at:

Sydney

Delivered on:

13 August 2012

REPRESENTATION

Solicitors for the Applicant:

Sally Nash & Co

Solicitors for the Respondent:

Grace Lawyers Pty Limited

ORDERS, BY CONSENT

Compliance with the requirements of Rule 7.06(3) of the Federal Magistrates Court (Bankruptcy) Rules is dispensed with.
The Sequestration Order made on 27 July 2012 in proceedings SYG1371/2012 be set aside.
The Creditors Petition in proceedings SYG1371/2012 be dismissed.
The Applicant to pay the Respondent’s costs of this Application and proceedings SYG1371/2012.
The Court directs the Official Receiver to remove the making of the Sequestration Order from the NPII.
That a copy of this order be given to the Official Receiver within 48 hours of receipt.

NOTES, BY CONSENT

The Court notes the undertaking of the Applicant to the Court to make payment of all unpaid levies, interest and costs, including the costs of this Application and the costs of proceedings SYG1371/2012, owed to the Respondent up to and including 13 August 2012 in the sum of $48,490.36 and the Trustee’s costs and remuneration in the sum of $6,600.00
The Court notes the Applicant has given an irrevocable authority to his solicitor, Sally Nash of Sally Nash & Co Lawyers, to issue two trust account cheques to the Respondent’s solicitor on or before 5.00 pm on 13 August 2012 in payment of the amounts referred to in the preceding paragraph and that such instructions cannot be withdrawn until the trust account cheques have been banked and have cleared in the Respondent’s solicitors trust account.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT SYDNEY

SYG 1736 of 2012

GEORGE SAVVA

Applicant

And

THE OWNERS – STRATA PLAN NO 79419

Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

This is an application filed on 9 August 2012 seeking that the decision of a Registrar of this court to make a sequestration order in relation to the estate of the respondent, Mr Savva, be reviewed and set aside. In the alternative it is sought that the bankruptcy be annulled.
The applicant and the petitioning creditor and the Trustee of the applicant’s bankrupt estate agree that the orders sought are that the sequestration order should be set aside, the creditor’s petition dismissed, the applicant pay the respondent’s costs of this application and of the creditor’s petition and that the Court note the written undertaking of Mr Savva to make payment of all unpaid levies, interest and costs to the respondent in a specified amount and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2012] FMCA 753
Decision Date: 13 August 2012

CaseChat Overview and Summary

In the case of Savva v The Owners – Strata Plan No 79419, the applicant, George Savva, applied for a review of the decision of a Registrar of the Federal Magistrates Court to make a sequestration order in relation to his estate. The application was heard on 13 August 2012 by Barnes FM. The applicant sought to have the sequestration order set aside and for the creditors' petition to be dismissed. The court granted the application and set aside the sequestration order, dismissed the creditors' petition, and ordered that the applicant pay the costs of the application and proceedings. The applicant also provided an undertaking to pay all unpaid levies, interest, and costs to the respondent, as well as the Trustee's costs and remuneration.

The primary legal issue before the court was whether the sequestration order should be set aside and the bankruptcy annulled. The court had the power to review the exercise of the Registrar's powers under s.104(2) of the Federal Magistrates Act 1999 (Cth). The court also considered whether the applicant's bankruptcy should be annulled instead of setting aside the sequestration order. The court found that the applicant had not delayed in bringing the proceedings and that he had provided evidence of his assets and liabilities, as well as the impending sale of a property, which suggested that he was solvent and able to pay his debts. The court was satisfied that it was appropriate to bring the applicant's bankruptcy to an end and set aside the sequestration order.

Barnes FM noted that the applicant had overlooked the importance of the hearing and would have sought an adjournment if he had attended. The court was satisfied that the applicant's evidence suggested he was solvent and able to pay his debts, as required by s.52(2)(a) of the Bankruptcy Act 1966 (Cth). The court also noted that the Trustee neither consented nor opposed the orders being made. The court did not consider it appropriate to annul the bankruptcy in this case, as there was no suggestion that the sequestration order should not be set aside.

The court ordered that the sequestration order made on 27 July 2012 be set aside, the creditors' petition be dismissed, and the applicant pay the respondent's costs of the application and proceedings. The court also noted the applicant's undertaking to pay all unpaid levies, interest, and costs, as well as the Trustee's costs and remuneration. The Court directed the Official Receiver to remove the making of the Sequestration Order from the National Personal Insolvency Index.

Orders