Tweed Shire Council v Dove

[2016] FCCA 232

FEDERAL CIRCUIT COURT OF AUSTRALIA

TWEED SHIRE COUNCIL v DOVE [2016] FCCA 232

Catchwords:
BANKRUPTCY – Whether a sequestration order should be made – no evidence that the applicant can pay his debts – sequestration order made.

Legislation:

Bankruptcy Act 1966, ss.27, 43, 52

Federal Circuit Court Bankruptcy Rules 2006, rr.4.05, 4.06

Applicant: TWEED SHIRE COUNCIL

Respondent: GREGORY MITCHELL DOVE

File Number: SYG 833 of 2015

Judgment of: Judge Street

Hearing date: 10 February 2016

Date of Last Submission: 10 February 2016

Delivered at: Sydney

Delivered on: 10 February 2016

REPRESENTATION

Solicitors for the Applicant:

Ms C Graves

Prime Lawyers

Solicitors for the Respondent: Mr W Soon

Solicitors for the Respondent: Citilawyers

ORDERS

1. A sequestration order is made against the estate of GREGORY MITCHELL DOVE.

2. The applicant creditor’s costs fixed in the amount of $9936.00 are to be paid from the estate of the respondent.

THE COURT NOTES THAT:

The date of bankruptcy is 9 March 2015.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 833 of 2015

TWEED SHIRE COUNCIL

Applicant

And

GREGORY MITCHELL DOVE

Respondent

REASONS FOR JUDGMENT

1. This is an application within the Court’s jurisdiction under s.27 of the Bankruptcy Act 1966, in respect of a creditor’s petition filed on 26 March 2015.  The judgment debt in the present case arises out of council rates that the respondent has failed to pay.  The amount outstanding is now in excess of $37,000.

2. The matter was the subject of an earlier order that was made ex parte by a Registrar, and for reasons given on 8 October 2015, that ex parte order was set aside.  It was said on that occasion that there were proceedings on foot very shortly to be heard, that may result in the respondent being in a position to satisfy the judgment debt.  The Court was informed by counsel for the applicant that the respondent did not have the capacity to meet the outstanding judgment debt and costs. 

3. No affidavit evidence was put on by the respondent to explain the steps that had been taken in the proceedings since the making of the orders on 8 October 2015.  The proceedings were stood over to today and counsel sought an adjournment for seven days in order to endeavour to explore grounds upon which the petition might be the subject of agitation. 

4. Given the history of the matter and the continuity of the instructing solicitor in relation to the respondent, and the absence of any evidence to explain what had occurred, I can see no utility in granting an adjournment, particularly in light of the concession made by Mr Soon on behalf of the respondent.  The adjournment application was opposed by the applicant and, in light of the above matters, the adjournment was refused. 

5. I am satisfied that the respondent committed an act of bankruptcy on 9 March 2015 in respect of a bankruptcy notice that was properly served on the respondent. I am satisfied that the creditor’s petition was properly verified and the Court has a current affidavit of debt and current affidavit of search consistent with the rules. I am satisfied that the requirements of s.43(1)(b) are made out. I am satisfied that the requirements in relation to the creditor’s petition under part IV of the Federal Circuit Court Bankruptcy Rules 2006 have been satisfied.  I am satisfied the requirements of r.4.05 of the Federal Circuit Court Bankruptcy Rules 2006 have been met, as well as the requirements of r.4.06.

6. I am satisfied the petition creditor has proved the criteria identified in s.52(1) of the Bankruptcy Act. I am satisfied that no ground has been made out under s.52(2) of the Act and that the applicant is not able to pay his debts. I am satisfied that other sufficient cause whereby a sequestration order ought not to be made, has not been made out.

7. The Court notes that counsel for the respondent wished to have noted his presence but did not otherwise put any submissions in relation to the petition.

8. I am satisfied that this is an appropriate matter in which to exercise the court’s jurisdiction under s.43 of the Bankruptcy Act 1966, and I make a sequestration order against the estate of Gregory Mitchell Dove. 

9. I am satisfied that the petitioning creditor should have the costs of the application made on the last occasion in the amount which I fix at $6430.  I am satisfied that the costs that have been incurred in respect of the further conduct of the petition should be fixed in the amount of $3506, making a total of $9936 to be paid from the estate of the respondent.

I certify that the preceding nine (9) paragraphs are a true copy of the reasons for judgment of Judge Street

Date: 11 February 2016