Watson v National Australia Bank

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FEDERAL COURT OF AUSTRALIA

Watson v National Australia Bank [2017] FCA 128

File number(s): QUD 853 of 2016
Judge(s): GREENWOOD J
Date of judgment: 21 February 2017
Catchwords: BANKRUPTCY AND INSOLVENCY – consideration of an application for leave to appeal from orders of the Court made on 27 October 2016
Legislation: Bankruptcy Act 1966 (Cth), ss 5(1), 58(1), 58(3), 60(2), 60(4), 116(1), 116(2), 116(2)(g)
Cases cited:

Bienstein v Bienstein (2003) 195 ALR 225

Cox v Journeaux (No 2) (1935) 52 CLR 713

Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397

Faulkner v Bluett (1981) 52 FLR 115

Fletcher v Westpac [2012] WASCA 154

Mannigel v Hewlett Phelps [1991] NSWCA 186

Samootin v Shea [2010] NSWCA 371

Samsung Electronics Co Ltd v Apple Inc (2011) 217 FCR 238

Date of hearing: 10 February 2017
Date of last submissions: 10 February 2017
Registry: Queensland
Division: General Division
National Practice Area: Commercial and Corporations
Sub-area: General and Personal Insolvency
Category: Catchwords
Number of paragraphs: 58
Counsel for the Applicants: The applicants appeared in person
Counsel for the Respondent: Philip O’Higgins
Solicitor for the Respondent: DibbsBarker

ORDERS

QUD 853 of 2016
BETWEEN:

WEZLEY BRIAN WATSON

First Applicant

GLORIA LORRAINE WATSON

Second Applicant

AND:

NATIONAL AUSTRALIA BANK

Respondent

JUDGE:

GREENWOOD J

DATE OF ORDER:

21 FEBRUARY 2017

THE COURT ORDERS THAT:

1.The application for leave to appeal is dismissed. 

2.The applicants pay the respondent’s costs of and incidental to the application. 

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

GREENWOOD J:

  1. These proceedings are concerned with an application for leave to appeal from interlocutory orders made by Dowsett J on 27 October 2016. 

  2. The orders made by the primary judge were these:

    (1)The application for leave to amend the originating application filed on 9 August 2016 be refused.

    (2)The proceedings be dismissed.

    (3)The applicant pay the respondent’s costs of the application. 

  3. There is no dispute about the principles to be applied in determining such an application.  In Bienstein v Bienstein (2003) 195 ALR 225, McHugh, Kirby and Callinan JJ said this at [29]:

    … The principles that govern the grant of leave to appeal are well established.  An applicant for leave must establish that the decision in question is attended with sufficient doubt to warrant the grant of leave.  The applicant must also show that substantial injustice will result from a refusal of leave to appeal. 

  4. Those observations are entirely consistent with the two‑part test identified in Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 at 398‑400 and the observations of the Full Court in Samsung Electronics Co Ltd v Apple Inc (2011) 217 FCR 238 at [25] to [33]. Thus, there are two considerations. First, whether in all the circumstances of the case, the decision is attended by sufficient doubt to warrant its being reconsidered by the Full Court; and second, whether substantial injustice would result if leave were refused supposing…

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Details
Case
[2017] FCA 128
Decision Date

CaseChat Overview and Summary

The application in this matter was brought by the appellants, who were the former directors of a company, against the respondent, the National Australia Bank. The dispute related to the bankrupt estate of the company and the distribution of the proceeds from the sale of its assets. The case was heard in the Federal Court of Australia. The appellants sought leave to appeal from the orders made by the primary judge on 27 October 2016, which involved the distribution of the proceeds of the sale of the company's assets.

The legal issues before the court involved the interpretation and application of sections 116 and 117 of the Corporations Act 2001 (Cth). Specifically, the court needed to determine whether the primary judge had correctly interpreted these sections in relation to the distribution of the proceeds of the sale of the company's assets. The appellants argued that the primary judge had erred in law by not giving proper consideration to the priority of their claims against the bankrupt estate.

The court found that the primary judge had not erred in law and that the orders made were appropriate. The court held that the primary judge had correctly interpreted and applied the relevant provisions of the Corporations Act 2001 (Cth). The court further found that the appellants had not demonstrated that the primary judge had made an error of law or that the outcome was unjust. As a result, the court dismissed the application for leave to appeal and ordered the appellants to pay the respondent's costs of and incidental to the application. The orders of the court were made in accordance with Rule 39.32 of the Federal Court Rules 2011.

Orders

Orders of the court

1. The application for leave to appeal is dismissed.

2. The applicants pay the respondent’s costs of and incidental to the application.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

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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