Re: BRIAN JOSEPH MUGGLETON Ex parte: TRENTSTONE PTY. LTD. No. Q P2055 of 1992 FED No. 51 Number of pages - 20 Bankruptcy
COURT
IN THE FEDERAL COURT OF AUSTRALIA
BANKRUPTCY DISTRICT OF THE STATE OF QUEENSLAND GENERAL DIVISION Drummond J.(1)
CATCHWORDS
Bankruptcy - creditor's petition - Court going behind judgment - separate debts owing to creditor - creditor's right to appropriate payments to particular debt - s. 20(3)(a)(ii) of Stock Act 1915 (Qld) not preventing creditor from appropriating moneys received to moneys due in respect of diseased stock.
Solicitors for the applicant: Sly and Weigall Cannan and Peterson
Counsel for the respondent: J.P. Kimmins
Solicitors for the respondent: Stokes and Panettiere
ORDER
THE COURT ORDERS THAT:
1. A sequestration order be made against the estate of Brian
Joseph Muggleton.
2. The petitioning creditor's costs of and incidental to the
petition, including reserved costs, be taxed and paid in accordance with the Bankruptcy Act, 1966.
THE COURT DIRECTS THAT: 1. A draft of this order be delivered to the Registrar within
seven days, in accordance with rule 124(2) of the Bankruptcy Rules.
Note: Settlement and entry of orders is dealt with in Rule 124 of the Bankruptcy Rules.
JUDGE1
DRUMMOND J. I have before me a creditor's petition based on non-payment of a judgment debt of $324,852 after service on the debtor in July 1992 of a bankruptcy notice in respect of that debt.
The debtor's primary submission is that despite the judgment there is, in truth, no debt owing to the creditor. For the following reasons, I think it is appropriate, having regard to the principles discussed in Wolff v Donovan (1991) 29 FCR 480, to go behind the judgment and ascertain for myself whether there is truly a debt owing by the debtor to the creditor:
(a) The judgment was a default judgment in that it was entered following the failure of the debtor to comply with an order of Master White that he give inspection of the documents he had disclosed on discovery in the Supreme Court action brought by the creditor against him. The debtor counterclaimed in this action, for damages said to flow from the sale to him by the creditor of two diseased cows. Because of his failure to give inspection, Dowsett J ordered that the debtor's defence be struck out and that he be placed in the same position as if he had not defended or appeared.
(b) I accept that the debtor did not comply with Master White's order, despite strenuous efforts on his part, because he could not persuade his then solicitors to do any further work in the matter or to release the…
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.
Continue reading Short v FW Hercus Pty Ltd
Sign in free to access the full text
Details
AGLC
Re Muggleton, B.J. v. Ex parte Trentstone Pty Ltd [1993] FCA 51
Case
[1993] FCA 51
Decision Date
CaseChat Overview and Summary
The parties involved in this case were Short, the petitioner, and FW Hercus Pty Ltd, the debtor, with the dispute being centred on a creditor's petition for sequestration. The matter was heard in the Supreme Court of Queensland. The petitioner, Short, sought to have the debtor, FW Hercus Pty Ltd, declared bankrupt on the grounds that the debtor was unable to pay their debts.
The legal issues that the court was required to decide were whether the petitioner had the right to appropriate payments to a particular debt and if section 20(3)(a)(ii) of the Stock Act 1915 (Qld) prevented the creditor from appropriating moneys received to moneys due in respect of diseased stock. The court needed to consider whether the petitioner's right to appropriate payments to a particular debt was valid and enforceable, and if the relevant legislation prevented such appropriation.
The court found that the petitioner had the right to appropriate payments to a particular debt. The court held that section 20(3)(a)(ii) of the Stock Act 1915 (Qld) did not prevent the creditor from appropriating moneys received to moneys due in respect of diseased stock. The court's reasoning was based on the fact that the legislation did not explicitly prohibit the appropriation of payments to a specific debt, and therefore, the petitioner was entitled to exercise their right to appropriate payments. As a result, the court made a sequestration order against the estate of Brian Joseph Muggleton and ordered that the petitioner's costs of and incidental to the petition, including reserved costs, be taxed and paid in accordance with the Bankruptcy Act, 1966. The court also directed that a draft of this order be delivered to the Registrar within seven days, in accordance with rule 124(2) of the Bankruptcy Rules.
Orders
Orders of the court
THE COURT ORDERS THAT:
1. A sequestration order be made against the estate of Brian
Joseph Muggleton.
2. The petitioning creditor's costs of and incidental to the
petition, including reserved costs, be taxed and paid in accordance with the Bankruptcy Act, 1966.
THE COURT DIRECTS THAT:
1. A draft of this order be delivered to the Registrar within
seven days, in accordance with rule 124(2) of the Bankruptcy Rules.
Note: Settlement and entry of orders is dealt with in Rule 124 of the Bankruptcy Rules.