Shaw v NM Superannuation Pty Ltd (AMP) (No 2)
[2025] FedCFamC2G 887
•11 June 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Shaw v NM Superannuation Pty Ltd (AMP) (No 2) [2025] FedCFamC2G 887
File number(s): BRG 173 of 2022 Judgment of: JUDGE EGAN Date of judgment: 11 June 2025 Catchwords: BANKRUPTCY – whether an undischarged bankrupt had the relevant legal capacity to commence legal proceedings in respect of an interest in a regulated superannuation fund when any such interest was not property divisible amongst creditors of the bankrupt under s. 116(2)(d)(i) of the Bankruptcy Act – whether the trustee in Bankruptcy had any chose in action vested in him – application for declarations and orders made by trustee granted. Legislation: ASIC Act (Cth)
Australian Consumer Law (Cth)
Competition and Consumer Act 2010 (Cth)
Corporations Act (Cth)
Bankruptcy Act 1966 (Cth), s. 58(1), s. 116(2)(d)(iii)(A)
Federal Circuit and Family Court of Australia Act 2021, s. 143
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), r. 13.13
Cases cited: Batterham v Clayton Utz Partnership [2022] FCA 360
Batterham v Nauer [2019] FCA 485
Division: Division 2 General Federal Law Number of paragraphs: 19 Date of hearing: 6 June 2025 Counsel for the Applicant The applicant appeared on his own behalf Counsel for the Respondent Mr C. Curtis of Counsel Solicitor for the Respondent HWL Ebsworth ORDERS
BRG 173 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: JOHN SHAW
Applicant
AND: NM SUPERANUATION PTY LTD (AMP) ABN 31 008 428 322
Respondent
ORDER MADE BY:
JUDGE EGAN
DATE OF ORDER:
11 JUNE 2025
IT IS DECLARED THAT:
1. Pursuant to s. 143 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) and r. 13.13 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021, summary judgment be entered in favour of the Respondent on the grounds that, by reason of his bankruptcy, the applicant had no capacity to commence the proceeding and:
a.It is declared that the Applicant, by reason of his bankruptcy, did not have capacity to commence the proceeding no. BRG173/2022 and:
b.The proceeding be dismissed.
2. The applicant had no capacity to enter into the deed titled “Deed of Settlement and Release” entered into by the applicant and respondent by electronic counterparts on 14 November 2024 and 18 November 2024 (being exhibited as Exhibit RCL-38 and RCL-39 to the affidavit of Ms Reanna Lawrence filed on 13 December 2024.
AND IT IS ORDERED THAT:
3. The Application in a Proceeding filed on behalf of the respondent on 28 February 2025 be granted, and that the proceeding be dismissed.
4. The applicant pay the respondent’s costs of and incidental to the proceeding, including application for summary dismissal, such costs to be as agreed, or failing agreement, as assessed pursuant to the provisions of Rule 22.02(2)(c) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE EGAN
Introduction
The applicant was declared bankrupt by order of the Federal Court on 11 June 2014. [1] As at the present time, the applicant remains an undischarged bankrupt.
[1] See RCL-1 to the Affidavit of Reanna Lawrence filed on 28 February 2025.
On 22 April 2022, the applicant filed an Application in the Court’s Registry seeking the following orders against the respondent:
1. Refund of fees deducted during period 1 Sep 2010 to 1 Dec 2021 from AMP Superannuation account (953413115) for disability & death cover
2. Penalty interest.
3. Costs
The Grounds of the Application were set out as follows:
1.The insurance cover was provided without the knowledge & consent or authorisation of the applicant & fees were deducted without the express knowledge & consent of the applicant.
2.The terms and conditions of the cover were not provided or explained to or agreed to by the applicant.
3.The fees were unfairly increased without authorisation to an unreasonable amount grossly disproportionate to fair market rates for insurance cover to be provided.
4.The deduction of fees without consent was unlawful & unconscionable.
5.The increase of fees was commercially unconscionable.
6.The conduct of the respondent was unfair & unconscionable.
The applicant filed a Statement of Claim on 26 June 2023. The relief sought in the Statement of Claim, under the heading “Orders Requested”, was as follows:
40. I request that the court order AMP reinstate my personal super fund that existed prior to rolling over into the IFF & to refund the excessive unauthorised insurance & management fee deductions & lost earnings dating from June 2009 to the date I formally cancelled death & disability cover in 2021 with penalty interest back into that super fund.
41. I request that my current superannuation plan be rolled over into the reinstated plan with adjustment for loss of earnings & differences fees & deductions current plan to reinstated plan from period 4 May 2009 to present day.
I.e. in summary to put me back in the position I would have been in if my super plan as it existed prior to rolling into the IFF plan in 2009 had not been changed.
42. Alternatively AMP to reinstate my IFF plan terms & conditions and compensate that plan for loss of earnings & the differences in fees & charges charged by AMP under the existing Super fund from 2012 to present day
42. I also request the court order exemplary damages of $40,000 for unconscionable conduct in their handling of this complaint, unfair & unconscionable fee charges & increases & expectation that it is Ok to place to onus on me to "be aware & opt out" of unsolicited offers of insurance & terms of superannuation buried in unexplained & unreasonably complicated product disclosure statements allegedly sent by normal post without reasonable care, notice or explanation weeks after I signed up.
43. I request costs & expenses allowable for a self-represented litigant
In its Defence filed on 11 July 2023 at [44] and [45], and in the affidavit of Ms Lawrence filed on 13 December 2024 at p. 253 – 267 of annexure bundle, it was pleaded/claimed:
1.That the applicant’s cause of action was time-barred by reason of the expiration of a six-year limitation period;
2.That the applicant’s cause of action vested in the applicant’s trustee in Bankruptcy;
3.That a deed of settlement entered into between the applicant and the respondent in November 2024 immediately released and discharged the respondent from all causes of action against the respondent.
Pursuant to its Application in a Proceeding filed on 28 February 2025, the respondent seeks summary judgment pursuant to Rule 13.13 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (the Rules) on the ground that the applicant, by reason of his bankruptcy had no capacity to commence the subject proceeding.
Legal Analysis
Section 58(1) of the Bankruptcy Act 1966 (Cth) (BA) relevantly provided as follows:
BANKRUPTCY ACT 1966 - SECT 58
Vesting of property upon bankruptcy--general rule
(1) Subject to this Act, where a debtor becomes a bankrupt:
(a) 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; and
(b) after - acquired property of the bankrupt vests, as soon as it is acquired by, or devolves on, the bankrupt, in the Official Trustee or, if a registered trustee is the trustee of the estate of the bankrupt, in that registered trustee.
Note 1: This subsection has a limited application if there are orders in force under the proceeds of crime law: see section 58A.
Note 2: Even if property has vested under this section, it may, under the Proceeds of Crime Act 2002 :
(a) become subject to a restraining order; and
(b) be taken into account in making a pecuniary penalty order; and
(c) become subject to a charge to secure the payment of an amount under a pecuniary penalty order, if it is subject to a restraining order; and
(d) be dealt with by the Official Trustee, if it is subject to a restraining order and a court has directed the Official Trustee to pay the Commonwealth an amount under a pecuniary penalty order out of property subject to the restraining order.
In Batterham v Nauer [2019] FCA 485 at [174] – [176] Gleeson J held as follows:
174. Section 58(1) of the Bankruptcy Act provides that “where a debtor becomes a bankrupt: (a) the property of the bankrupt, not being after-acquired property, vests forthwith in the Official Trustee …”.
175. The word “property” is broadly defined in s 5 of the Bankruptcy Act. For the purposes of s 58 of the Act, “property” which vests in the trustee in bankruptcy includes choses in action and claims to enforce equitable rights: Moss v Eaglestone [2011] NSWCA 404; (2011) NSWLR 476 at [28]; Pridmore v Magenta Nominees Pty Ltd [1999] FCA 152; (1999) 161 ALR 458 at [58] and [63]. A bare right to sue in respect of alleged property and economic losses is property of the bankrupt which will vest in the trustee pursuant to s 58: Kovarfi v BMT & Associates Pty Ltd (No 2) [2014] NSWSC 100 at [27].
176. Thus, upon his bankruptcy, any chose in action which Mr Batterham then had vested with his trustee in bankruptcy.
In May 2009, as part of the applicant’s then employment package with a business called “International Flavours and Fragrances”, the applicant became a member of a separate AMP superannuation fund. The applicant’s employment was terminated in or about August 2010. At [27] of the applicant’s Statement of Claim, it was pleaded by him as follows:
27. If I had known in 2009 that the IFF fund would be cancelled if I ceased employment I would not have joined in the first place nor would I have rolled over my existing personal super fund.
At [4] of the Defence, it was pleaded as follows:
4.As to paragraph 4 of the Statement of Claim, the Respondent denies the allegation that the Applicant was not provided with any details or an explanation of the terms and conditions of the superannuation funds referred to because:
(a) on 16 June 2009 correspondence was sent to the Applicant confirming the creation of the CustomerSuper Account which identified the default insurance cover for Death and TPD included in the IFF Superannuation Plan and the monthly charge for each insurance cover;
(b) on 16 June 2009, a copy of the relevant CustomSuper Product Disclosure Statement (PDS) for the CustomSuper Account was sent to the Applicant which provided information about the superannuation product including features of the product and fees and:
(i) page 36 of the PDS stated that the Applicant was entitled to cancel any insurance cover via written correspondence to the Respondent at any time;
(ii) page 25 of the PDS outlined that the Respondent could commence various default insurance covers via automatic acceptance limits; and
(iii) page 50 of the PDS explained that the Respondent must leave the CustomSuper plan (ie IFF Superannuation Plan) either when they retire or when the Respondent was advised by the Applicant's employer that their employment ceased; and
(c) on 1 August 2012, the Respondent sent correspondence to the Applicant advising that it had been notified that the Applicant was no longer employed by IFF and the Applicant's CustomSuper Account would be transferred from the IFF Superannuation Plan to a Flexible Lifetime-Super Account No. 953413115 (Flexible Lifetime Super Account) and included a comparison table of the fees being charged and rebates under the Flexible Lifetime Super Account compared to the CustomSuper Account.
To the extent that the applicant had any right or chose in action against the respondent, such right or chose in action existed prior to the applicant’s bankruptcy and vested in the applicant’s trustee at the time of such bankruptcy. [2]
[2] Batterham v Nauer at [175].
As disclosed in the Statement of Claim, the applicant’s claimed causes of action were either based upon alleged breaches of the Competition and Consumer Act 2010 (Cth), the ASIC Act (Cth), the Corporations Act (Cth), or the Australian Consumer Law (Cth) (the ACL). Regardless of the fact that the ACL did not come into force until on or about 12 November 2016, any other cause of action which the applicant had was, at best, an assignable property right in the nature of a chose of action which, upon the applicant’s bankruptcy, vested in his trustee.
The applicant’s right of action/chose in action was to be distinguished from the subject matter of the right of action which, for present purposes, was assumed to be an interest in a regulated superannuation fund. That any interest of the applicant in a regulated superannuation fund may not have been property divisible amongst the creditors of the applicant was irrelevant.
Accordingly, the fact that the applicant may have had an exemption in respect of the interest held by him in the superannuation fund did not entitle him to commence any proceeding in this Court in respect of such claimed interest based upon the provisions of s. 116(2)(d)(iii)(A) of the BA. As was held by Halley J in Batterham v Clayton Utz Partnership [2022] FCA 360 at [203] – [206]:
203. I now turn to consider the contention advanced by each of the respondents that the causes of action that Mr Batterham now seeks to advance in these proceedings vested in his trustee on the making of the Sequestration Order.
204. At the outset it is important to distinguish between a bankrupt’s interest in a regulated superannuation fund for the purposes of s 116(2)(d)(iii) and a cause of action that the trustee of a regulated superannuation fund might have in respect of the diminution in the value of assets held in the fund.
205. Mr Batterham’s contention that the BRF was an “exempt asset” for the purposes of s 116 of the Bankruptcy Act because the ZCL Shares were owned by his superannuation fund is therefore misconceived. Maylord’s cause of action with respect to the diminution in the value of the ZCL Shares is distinct from Mr Batterham’s interest as a beneficiary in the BRF. Nor could it be characterised as a right to recover damages or compensation for any personal injury or wrong done to him. Any cause of action that Mr Batterham might have had with respect to the diminution in the value of the ZCL Shares would not have been an “exempt asset”.
206. I am satisfied that to the extent that Mr Batterham had any cause of action with respect to the diminution in the value of the ZCL Shares such cause of action existed as at the date of his bankruptcy, was not an exempt asset and vested in his trustee in bankruptcy on the making of the Sequestration Order pursuant to s 58(1) of the Bankruptcy Act.
The Court finds that the applicant had no right or capacity to commence the subject proceeding, and that such proceeding is a nullity unless the Trustee elects to adopt the claims either on behalf of creditors, or on behalf of the applicant. The trustee’s discretion, in that regard, ought not to be fettered.
The Court also accepts the submission made on behalf of the respondent that as a consequence of the above ruling, the applicant never had the requisite capacity to enter into the Deed on 13 November 2024
Further, and in any event, the Court finds that at the time of the institution of this proceeding, the applicant’s right of action was statute barred. The Court accepts as accurate the pleading at [45] of the Defence which relevantly was as follows:
45. The Respondent says that the entirety of the Applicant's claims, or in the alternative all claims so far as they concern conduct or omissions alleged to have occurred before 22 April 2016, are time-barred as all of the causes of action would have arisen, if at all, by no later than 22 April 2016 and:
(a) this proceeding was commenced on 22 April 2022;
(b) in relation to the alleged causes of action arising under the Competition and Consumer Law 2010 (Cth) and the Australian Consumer Law being in force as Schedule 2 thereto, section 236(2) of the Australian Consumer Law provides that any claim seeking recovery of a monetary amount must be commenced within 6 years of the day on which the cause of action that relates to the conduct accrues;
(c) in relation to the claims for contraventions of the Australian Securities and Investments Commission Act 2001 (Cth), section 12GF(2) provides that any action for loss and damage must be commenced within 6 years of the day on which the cause of action that relates to the conduct accrues; and
(d) in relation to any cause of action based in tort or for restitution, section 10 of the Limitation of Actions Act 1974 (Qld) which provides that any such action must be commenced within 6 years of the date of the cause of action.
The applicant had no reasonable prospects of success in his claims. [3] It is ordered that summary judgment be entered in favour of the respondent against the applicant.
[3] Rule 13.13(a) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law)
Rules 2021 (Cth).
The Court will hear the parties as to costs.
I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Egan. Associate:
Dated: 11 June 2025
0
6
7