Vrsecky v Reaper and Anor (No.2) - [2015] FCCA 2230

FEDERAL CIRCUIT COURT OF AUSTRALIA

VRSECKY v REAPER & ANOR (No.2)

[2015] FCCA 2230

Catchwords:
BANKRUPTCY – Where bankrupt’s home co-owned with partner and purchased partly with protected moneys – evaluation of amount to be paid to the bankrupt pursuant to s.116(4) of the Bankruptcy Act 1966 – bankruptcy and partner’s (“the respondents”) cross claim for alleged storm damage and ancillary matters – respondents’ allegations not established – respondents’ generalised complaints about conduct of trustee not made out – cross-claims dismissed.

Legislation:
Bankruptcy Act 1966, ss.116, 116(2D), 116(3), 116(4)

Vrsecky v Reaper & Anor [2015] FCCA 32
Re Iskenderian; Ex parte Iskenderian Bros Pty Ltd and Others (1989) 21 FCR
Re Manivilovski; Ex parte Official Trustee in Bankruptcy (1993) 45 FCR 358
Re Zylvain Stanley Jemielita Ex Parte: Official Trustee in Bankruptcy [1996] FCA 1208

Applicant:

PETR VRSECKY AS TRUSTEE OF THE BANKRUPT ESTATE OF BRETT VINCENT REAPER

First Respondent:

BRETT VINCENT REAPER

Second Respondent:

SHARON FISHER

File Number:

MLG 931 of 2013

Judgment of:

Judge Burchardt

Hearing date:

5 June 2015

Date of Last Submission:

24 June 2015

Delivered at:

Melbourne

Delivered on:

24 August 2015

REPRESENTATION

Counsel for the Applicant:

Mr Devany

Solicitors for the Applicant:

Madgwicks

The First Respondent:

In person

The Second Respondent:

In person

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT MELBOURNE

MLG 931 of 2013

PETR VRSECKY AS TRUSTEE OF THE BANKRUPT ESTATE OF BRETT VINCENT REAPER

Applicant

And

BRETT VINCENT REAPER

First Respondent

SHARON FISHER

Second Respondent

REASONS FOR JUDGMENT

Introductory

These reasons for judgment are an attempt to bring to an end a protracted long running controversy between the parties. The matters in dispute can be defined in broad terms as the applicant trustee’s application for partition and sale of a property owned by the applicant, as trustee of the estate of the first respondent, and the second respondent (“the property”), and various applications contained in an interlocutory application filed by the respondents on 12 November 2014. Although a number of other matters are raised with which it will be necessary to deal, the primary questions are, first, the quantification of the trustee’s interests in the property and the amount that it might be necessary for the second respondent to pay the trustee to purchase that interest out. The second major matter is whether the trustee is liable for damages and other relief in respect of alleged negligence on his part relating to an insurance claim the respondents wish to press in relation to the property.
For the reasons that follow, I have concluded that the trustee’s interest in the property is worth $96,000, this being the sum that the second respondent will have to pay to the trustee to purchase that interest. As to the second issue, I have concluded that the respondents are not entitled to any relief in respect of what I will describe as their insurance claim.

History

This matter commenced as long ago as 27 June 2013. It has been very considerably delayed, not wholly by…

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.

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Details

Case: [2015] FCCA 2230
Decision Date: 24 August 2015

CaseChat Overview and Summary

In *Vrsecky v Reaper and Anor (No.2)*, the applicant, Vrsecky, sought to strike out the defence filed by the respondents, Reaper and Anor, in proceedings concerning alleged breaches of contract and misleading and deceptive conduct. The applicant contended that the defence lacked any real prospect of success and was an abuse of process.

The central legal issue before the court was whether the defence raised by the respondents had a real prospect of success, thereby justifying its retention on the court file. This required an assessment of the substantive merits of the defences pleaded, particularly in relation to the applicant's claim for damages.

Judge Burchardt found that the defence, as pleaded, was deficient and did not adequately address the applicant's claims. The court applied the principles governing applications to strike out a defence, emphasising that such applications are a summary procedure and should only be granted in clear cases where the defence is demonstrably without merit. The judge concluded that the defence, in its current form, failed to raise triable issues and was therefore an abuse of process.

Consequently, the court ordered that the defence be struck out, with leave granted to the respondents to file an amended defence within a specified timeframe.

Orders