FEDERAL MAGISTRATES COURT OF AUSTRALIA
| TOWNEND v TOWNEND & ANOR | [2008] FMCA 1610 and [2008] FMCAfam 1298 |
| FAMILY LAW – Application for alteration of property interests – respondent spouse a bankrupt – the Court has no jurisdiction under the Family Law Act 1975 (Cth) to make orders affecting property vested in the trustee in bankruptcy where the bankruptcy commenced before 18 September 2005 and where the trustee has not sought to be joined as a party. BANKRUPTCY – The Court may make orders under the Bankruptcy Act 1966 (Cth) to deal with matrimonial property vested in the trustee in bankruptcy. |
| Bankruptcy Act 1966 (Cth), ss.5, 30, 58, 59A, 116, 139P, 139Q, 139S, 139ZG Bankruptcy and Family Law Legislation (Amendment) Act 2005 (Cth) Family Law Act 1975 (Cth), ss.74, 79, 117 |
| Re Gillies; Ex-parte Official Trustee in Bankruptcy Re Gillies (1993) 42 FCR 571 Re Sharpe; Ex-parte Donnelly (1998) 80 FCR 536 Zachary & Zachary & Ors [2008] FMCAfam 1209 |
| Applicant: | JOYCE MARY TOWNEND |
| First Respondent: | MILES HAMILTON TOWNEND |
| Second Respondent: | OFFICIAL TRUSTEE IN BANKRUPTCY |
| File Numbers: | SYG1919 of 2008 SYC6330 of 2007 |
| Judgment of: | Driver FM |
| Hearing date: | 1 December 2008 |
| Delivered at: | Sydney |
| Delivered on: | 1 December 2008 |
REPRESENTATION
| Counsel for the Applicant: | Mr D Dura |
| Solicitors for the Applicant: | Gray & Perkins |
| Counsel for the First Respondent: | Mr D Jarrett |
| Counsel for the Second Respondent: | Mr J Johnson |
| Solicitors for the Second Respondent: | Sally Nash & Co |
ORDERS
The application against the second respondent is dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG1919 of 2008
SYC6330 of 2007
| JOYCE MARY TOWNEND |
Applicant
And
| MILES HAMILTON TOWNEND |
First Respondent
| OFFICIAL TRUSTEE IN BANKRUPTCY |
Second Respondent
REASONS FOR JUDGMENT
(revised from transcript)
I have before me competing applications under the Family Law Act 1975 (Cth) (“the Family Law Act”) and the Bankruptcy Act 1966 (Cth) (“the Bankruptcy Act”) in relation to certain real estate at 84 Maxwell Street, Turramurra. The family law application which was filed on
10 September 2007also seeks other relief as between spouses to the marriage in relation to property and also spousal maintenance.
There is a material distinction to be drawn between property vested in the second respondent, the Official Trustee, arising out of the bankruptcy of the first respondent, Miles Hamilton Townend, and other property of the parties to the marriage.
The matter had been proceeding for some considerable time on the basis that I would be dealing with the family law application, specifically in relation to the issues arising as between the applicant, Mrs Townend, and the Official Trustee in relation to the residential property at Turramurra. However, at the outset of the trial of this matter this morning, counsel for the Official Trustee raised a jurisdictional issue. That issue arises from the decision of this Court in Zachary & Zachary & Ors [2008] FMCAfam 1209 per Kemp FM.
I incorporate in this judgment paragraphs 27 through to 32 of that judgment:
The Law
By virtue of the Bankruptcy and…
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- AGLC
- Townend v Townend & Anor [2008] FMCA 1610
- Case
- [2008] FMCA 1610
- Decision Date
CaseChat Overview and Summary
The Court found that under the Family Law Act 1975 (Cth), it did not have the jurisdiction to make orders affecting property vested in the trustee in bankruptcy when the bankruptcy commenced before 18 September 2005 and the trustee had not sought to be joined as a party. The Court concluded that the Bankruptcy Act 1966 (Cth) provided the necessary framework for dealing with matrimonial property vested in the trustee in bankruptcy. Consequently, the Court dismissed the application against the second respondent, who was the trustee in bankruptcy, and determined that it could not proceed with altering the property interests as sought by the applicant.
The Court's reasoning was grounded in the statutory provisions of both the Family Law Act 1975 (Cth) and the Bankruptcy Act 1966 (Cth). The Court found that the legislative intent was to delineate the jurisdictions of the two Acts and that the Family Court did not have the authority to encroach upon the exclusive jurisdiction of the Bankruptcy Act 1966 (Cth) in certain circumstances. The Court's decision was based on a strict interpretation of the relevant legislation and the historical context of the bankruptcy and family law statutes. The Court emphasised that the Bankruptcy Act 1966 (Cth) provided the appropriate mechanism for dealing with matrimonial property vested in the trustee in bankruptcy, and thus, the Family Court was precluded from making such orders in the absence of the trustee's participation.
The final order of the Court was to dismiss the application against the second respondent, who was the trustee in bankruptcy. This outcome reflected the Court's conclusion that it lacked the jurisdiction to alter the property interests as sought by the applicant due to the specific circumstances of the bankruptcy and the statutory framework governing the matter. The Court's decision underscored the importance of adhering to the jurisdictional boundaries set out by the relevant legislation and the need for the appropriate parties to be joined in proceedings affecting property vested in a trustee in bankruptcy.
Orders
Orders of the court
1.
The application against the second respondent is dismissed.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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