Totterdell v D'Angelo - [2004] FMCA 645

FEDERAL MAGISTRATES COURT OF AUSTRALIA

TOTTERDELL v D’ANGELO

[2004] FMCA 645

BANKRUPTCY – Application by Trustee to declare void or not void Part X Composition – discretion – interests of creditors.

Bankruptcy Act 1966, ss.64ZC(6), 109(1)(e), 109(g), 188, 188A, 222, 222(1), 222(2), 222(4), 222(5), 222(6),

Musolino v Sidoropoulos (1991) 101 ALR 235
Re McLean Ex parte Trans Provident Life Office (1992) 36 FCR 502
Mutual Acceptance Ltd v May (1979) 4 ACLR 250
Re Turner Ex parte Official Receiver (1992) 39 FCR 528
Brott v Grey (2000) 181 ALR 617
Augustyn v Putnin (1988) 83 ALR 514
Raschilla v Gulluni (1987) 14 FCR 57
Tregonning; Ex parte Friends Provident Life Officer (1983) 74 FLR 327
Re Segal; Lensworth Financial Ltd v Segal & Ward (1975) 9 ALR 154
Chiragakis v Deputy Commissioner of Taxation (1986) 68 ALR 527
Walker & Sherman & Anor v Andrew & Ors (2002) NSWCA 214 (19 July 2002)

Applicant:

GEOFFREY FRANK TOTTERDELL

Respondent:

JOHN NICHOLAS D’ANGELO

File No:

WZ 49 of 2004

Delivered on:

24 September 2004

Delivered at:

Perth

Hearing Date:

21 September 2004

Judgment of:

McInnis FM

REPRESENTATION

Counsel for the Applicant:

Mr F Carles

Solicitors for the Applicant:

Carles Solicitors

Counsel for the Respondent:

Mr P Arns

Solicitors for the Respondent:

Arns & Associates

Counsel for the Creditors namely:

Leonard David Goldstein
Foo Jee Peng Peter
John Ian Cooke
Julie Smeets
Deborah Maree Harrington
Joel Joshua Sheldrick
Mary Victoria Reynolds
Gerard Math
Janelle Spargo
Sherrill Ann Richardson

Mr N Dillon

Counsel for the National Australia Bank:

Mr J Atkinson

Solicitors for the National Australia Bank:

Minter Ellison

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

WZ 49 of 2004

GEOFFREY FRANK TOTTERDELL

Applicant

And

JOHN NICHOLAS D’ANGELO

Respondent

REASONS FOR JUDGMENT

Introduction

This an application by Geoffrey Frank Totterdell (the Applicant) pursuant to s.222 of the Bankruptcy Act 1966 (the Act) in relation to a composition of John Nicholas D’Angelo (the Respondent).
As amended by Order of the Court on 6 May 2004 the application seeks the following orders:-
“1.The composition under Part X of the Act of John Nicholas D’Angelo be declared void pursuant to s.222(2) or alternative 222(4) of the Act, or alternatively not void.
2.The Applicants costs of this application be taxed or alternatively fixed and paid by the Respondent.
Mr Dillon appeared on behalf of what I would describe as a syndicate of creditors which in the present case shall simply be referred to as “the creditors”. Of significance are three creditors who are former employees.
It is noted from the Amended Application that essentially it is the desire of the Applicant to ensure that the validity of the Part X Composition be resolved one way or another.
The parties have relied upon numerous affidavits before the Court which may be usefully set out below:-
Applicant
1.Geoffrey Frank Totterdell sworn 7 April 2004;
2.Geoffrey Frank Totterdell sworn 26 May 2004 (verifying notice to creditors);
3.Geoffrey Frank Totterdell sworn 2 June 2004;
4.Alan Fancois Carles sworn 3…

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 Totterdell v D'Angelo

Details

AGLC: Totterdell v D'Angelo [2004] FMCA 645
Case: [2004] FMCA 645
Decision Date: 24 September 2004

CaseChat Overview and Summary

The case of Totterdell v D'Angelo involved an application by Geoffrey Frank Totterdell, the trustee in bankruptcy, seeking to have a composition proposal approved by the creditors of John Nicholas D'Angelo declared void or not void under the Bankruptcy Act 1966. The legal issues centered on whether there was a doubt on a specific ground as to compliance with Part X of the Act and whether there had been false or misleading information provided by the respondent in his Statement of Affairs. The court found that there was a doubt on a specific ground concerning the acceptance of the composition by a special resolution of the meeting of creditors due to invalid votes. Additionally, the court found that an incorrect material particular had been included in the Statement of Affairs. However, in exercising its discretion, the court determined that declaring the composition void was not in the interests of the majority of creditors. The composition was found to be in the interests of creditors, and therefore, it was not declared void.

Orders