The OWNERS-STRATA PLAN 31561 v Komidar

[2016] FCCA 3294

FEDERAL CIRCUIT COURT OF AUSTRALIA

THE OWNERS-STRATA PLAN 31561 v KOMIDAR [2016] FCCA 3294

Catchwords:
BANKRUPTCY – Creditor’s petition for a sequestration order – whether the Court was satisfied the debtor would pay the debts owing – failure to disclose a separate bank account – not an appropriate matter to dismiss the creditor’s petition – sequestration order made.

Legislation:

Bankruptcy Act 1966, ss.27, 52(2), 152A.

Applicant: THE OWNERS-STRATA PLAN 31561

Respondent: GOTTFRIED KOMIDAR

File Number: SYG 2101 of 2016

Judgment of: Judge Street

Hearing date: 16 December 2016

Date of Last Submission: 16 December 2016

Delivered at: Sydney

Delivered on: 16 December 2016

REPRESENTATION

Solicitors for the Applicant: Ms Warren
CCSG Legal Pty Ltd

Solicitors for the Respondent: The Respondent appeared in person.

ORDERS

1. The order made by the Registrar on 4 October 2016 that the estate of Gottfried Komidar be sequestrated under the Bankruptcy Act 1966 (Cth) is affirmed.

2. The Respondent pay the Applicant’s costs fixed in the amount of $4,237.20 as priority costs in accordance with s.109 of the Bankruptcy Act 1966 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2101 of 2016

THE OWNERS – STRATA PLAN 31561

Applicant

And

GOTTFRIED KOMIDAR

Respondent

REASONS FOR JUDGMENT

Background

1. This is an application to set aside a sequestration order made by a Registrar on 4 October 2016 within the Court’s jurisdiction under s.27 of the Bankruptcy Act 1966 (Cth) (“the Act”). The application is a hearing de novo.

2. On 24 November 2016, the Court heard evidence from the applicant in relation to the verification of the creditor’s petition, service of the bankruptcy notice, service of the creditor’s petition, verification of the debt, affidavit and search. The respondent filed and had read an affidavit alleging an off set or cross-claim because of proceedings recorded against a Mr Greg Myers who is not the judgment creditor but an officer of the petitioning creditor.

3. The application brought by the respondent in the District Court, on its face is a blatant abuse of process which identifies no genuine offset in demand or cross-claim. Nothing in the respondent’s evidence identified any genuine dispute in respect of the judgment debt. 

4. The Court adjourned the matter part heard on 24 November 2016 to give the applicant an opportunity to try and settle the matter.  Since that date, an affidavit has been filed by the trustee that identifies that the trustee has in fact, realised a surplus from an undisclosed bank account.  That bank account was not disclosed to the Court or in the report as to affairs. That is a material consideration as to whether or not this Court should be satisfied that there is other sufficient cause not to make the sequestration order.

5. Ordinarily, if a party is proved to have been solvent at the time of the sequestration order, that would constitute grounds upon which a bankruptcy order or at least a sequestration order would not be made because the Court would be satisfied that the debtor is able to pay his or her debts within s.52(2) of the Act. 

Consideration

1. On the material before the Court, I am satisfied the respondent committed an act of bankruptcy on 13 July 2016. I am satisfied the petitioning creditor has established the matter stated in the petition. I am satisfied as to the service of the petition. I find that the act of bankruptcy occurred on 13 July 2016. I am satisfied that the debt on which the petitioning creditor relied is still owing. As the respondent failed to disclose to the Court or in the report as to affairs, the other bank account that he had, I am not satisfied that other sufficient cause has been shown not to make a sequestration order. I am not satisfied that this is a case where the Court should dismiss the petition because of the funds that have been found by the trustee. 

2. In this regard, I note that the trustee has foreshadowed that steps will be taken to issue a certificate of annulment no later than 22 December 2016 pursuant to s.152A of the Act. I am satisfied that that is an appropriate course for the trustee to take in the circumstances of the present case. I am satisfied that the petitioning creditor to the extent not dispensed with by the Court, complied with the rules in relation to proof of debt and search.

3. I am satisfied that this is an appropriate matter in which a sequestration order should be made. I am not satisfied that it is appropriate to dismiss the petition under s.52(2) of the Act for the reasons given.

I certify that the preceding eight (8) paragraphs are a true copy of the reasons for judgment of Judge Street

Date: 25 January 2017