Weston v Sanna (No 4)

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FEDERAL COURT OF AUSTRALIA

Weston v Sanna (No 4) [2021] FCA 287  

File number: NSD 276 of 2016
Judgment of: MARKOVIC J
Date of judgment: 26 March 2021
Catchwords: PRACTICE AND PROCEDURE – application for an interlocutory injunction restraining the sale of property by the trustee of the bankrupt estate of the seventh respondent (Trustee) – where first respondent claims entitlement to current full value pursuant to s 121(5) of the Bankruptcy Act 1966 (Cth) (Act) – no prima facie case established – application dismissed 
Legislation: Bankruptcy Act 1966 (Cth) s 121
Cases cited:

Anscor Pty Ltd v Clout (Trustee) (2004) 135 FCR 469

Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618

Walton v Gardiner (1993) 177 CLR 378

Weston (Trustee) v Sanna [2019] FCA 32

Westpac Banking Corporation v The Bell Group Limited (in liq) (No 3) (2012) 270 FLR 1
Division: General Division
Registry: New South Wales
National Practice Area: Commercial and Corporations
Sub-area: General and Personal Insolvency
Number of paragraphs: 60
Date of hearing: 24 March 2021
Counsel for the Applicant: Mr A Spencer
Solicitor for the Applicant: Dentons Australia
Solicitor for the First Respondent: Mr T Hall of Hall Partners
Counsel for the Seventh Respondent: The Seventh Respondent appeared in person.
Solicitor for the Tenth Respondent: Mr G Adelstein of Adelstein Solicitors
Solicitor for the Eleventh Respondent: Mr A Hack of Matthews Folbigg Lawyers

ORDERS

NSD 276 of 2016
BETWEEN:

MR PAUL GERARD WESTON AS TRUSTEE OF THE BANKRUPT ESTATE OF LEPA SANNA

Applicant
AND:

CORRADO SANNA

First Respondent

BORAL CONSTRUCTION MATERIALS GROUP LTD

Second Respondent

E & B PASTORAL PTY LTD (and others named in the Schedule)

Third Respondent

ORDER MADE BY:

MARKOVIC J

DATE OF ORDER:

26 MARCH 2021

THE COURT ORDERS THAT:

1.Paragraph 4 of the first respondent’s interlocutory application filed on 8 February 2021 (Interlocutory Application) is dismissed.

2.The first respondent pay the applicant’s and the tenth respondent’s costs of paragraph 4 of the Interlocutory Application.

3.If the eleventh respondent wishes to make application for payment of its costs of paragraph 4 of the Interlocutory Application:

(a)the eleventh respondent should file and serve its submissions in support of such an application, not exceeding two pages in length, within seven days of the date of publication of these reasons;

(b)the first respondent should file and serve any submissions in reply, not exceeding two pages in length, within 14 days of the date of publication of these reasons; and

(c)the determination of any claim by the eleventh respondent for its costs will be dealt with on the papers.

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


REASONS FOR JUDGMENT

MARKOVIC J:

  1. By interlocutory application filed on 8 February 2021 (Interlocutory Application) Corrado Sanna, the first respondent to this proceeding, seeks orders as to his entitlement to seek any further or additional relief in this proceeding and, if so, a determination of the nature…

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Details
Case
[2021] FCA 287
Decision Date

CaseChat Overview and Summary

The case of Weston v Sanna (No 4) involved an application for an interlocutory injunction by Mr Sanna to restrain the sale of the Copacabana Property by the Trustee of the bankrupt estate of the seventh respondent. Mr Sanna sought an injunction to prevent the sale of the property, claiming entitlement to its current full value under section 121(5) of the Bankruptcy Act 1966 (Cth). The application was dismissed by the court. The central legal issue in this case was whether Mr Sanna had established a prima facie case to warrant the granting of an interlocutory injunction. The court had to consider whether Mr Sanna had demonstrated a sufficient likelihood of success on the merits of his claim to entitle him to an injunction.

In dismissing Mr Sanna's application, the court found that he had not established an arguable case for the relief he sought. The court examined the evidence provided by Mr Sanna, including affidavits from him and a solicitor, and concluded that Mr Sanna had not demonstrated that he had a reasonable prospect of success in his claim. The court held that Mr Sanna had failed to provide sufficient evidence to support his contention that he was entitled to the current full value of the property. Additionally, the court noted that Mr Sanna had not addressed certain relevant orders made previously by the court, which further undermined his application. As a result, the court dismissed the application and ordered Mr Sanna to pay the costs of the application to the Trustee and another respondent.

In conclusion, the court found that Mr Sanna had not met the threshold required to grant an interlocutory injunction. The court determined that Mr Sanna's application should be dismissed and that he should pay the costs of the application to the relevant parties. The court also provided a process for any party wishing to seek costs from another party to do so within a specified timeframe.

Orders

Orders of the court

1. Paragraph 4 of the first respondent’s interlocutory application filed on 8 February 2021 (Interlocutory Application) is dismissed.

2. The first respondent pay the applicant’s and the tenth respondent’s costs of paragraph 4 of the Interlocutory Application.

3. If the eleventh respondent wishes to make application for payment of its costs of paragraph 4 of the Interlocutory Application:

(a) the eleventh respondent should file and serve its submissions in support of such an application, not exceeding two pages in length, within seven days of the date of publication of these reasons;

(b) the first respondent should file and serve any submissions in reply, not exceeding two pages in length, within 14 days of the date of publication of these reasons; and

(c) the determination of any claim by the eleventh respondent for its costs will be dealt with on the papers.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

On 2 November 2020 the Court made orders dismissing Mr Sanna’s interim application and for Mr Sanna to pay the costs of those parties participating in the hearing of that application: see Weston (Trustee) v Sanna (No 2) [2020] FCA 1625.Mr Sanna’s Evidence Mr Sanna relies on an affidavit sworn by Andrea Lee, a solicitor in the employ of Mr Sanna’s current solicitors, and an affidavit sworn by him on 21 March 2021. In his affidavit Mr Sanna gives the following evidence:(1)he ceased to reside at the Copacabana Property on 4 November 2020 when the Sheriff came to the property and handed him an eviction notice. Mr Sanna says he moved out on that day;(2)at the time he moved out of the property there were personal items, furniture in the bedroom and a snooker table that were left behind. Mr Sanna says that the property was tidy when he vacated it, he had cut the grass and cared for it and, although the pool needed a “quick clean”, it was otherwise satisfactory. Mr Sanna accepts that he left a forklift and some formwork outside the property as well as three fridges and some outdoor furniture;(3)Mr Sanna has moved to his son’s home where he presently lives and assists with the rental and household costs; (4)he acknowledges that when he left the Copacabana Property there were outstanding water and council rates which he ceased to pay because he does not believe that the Trustee has a claim against his home. As far as Mr Sanna is concerned, if the Trustee is asserting that the Copacabana Property is his then the Trustee could attend to those expenses. For the same reasons Mr Sanna stopped paying the instalments due on the mortgage secured over the Copacabana Property. Mr Sanna says that he was advised by his former solicitors to stop paying the mortgage if the Trustee was seeking to avoid the transaction as well the rates and the water rates and so he did;(5)Mr Sanna now understands that orders were made on 15 June 2020 but, because he was distracted with his work at the time, he says he was not fully aware of the orders requiring him to pay council and water rates;(6)in recent times Mr Sanna has observed that the Copacabana Property has fallen into a state of disrepair;(7)Mr Sanna notes that there is a mortgage from Westpac Banking Corporations (Westpac) secured against the Copacabana Property, Westpac has not taken any action against him under the mortgage and, depending on the outcome of this application, he intends to take up matters concerning the mortgage with Westpac and how it may be serviced. He will seek to refinance the Copacabana Property and to pay instalments due under the mortgage from his income. Mr Sanna is a licensed concreting contractor and carries on business under the name Sanna Construction Pty Limited; (8)Mr Sanna says that in the event that a sale of the Copacabana Property was to proceed at a later time, because he could not resolve issues with Westpac, then he would sell the property after attending to its repair; and(9)he has offered to attend to repairs of the Copacabana Property but the Trustee’s solicitors have rejected his offer.

Decision

Reasons for decision

It follows that Mr Sanna’s application must fail.CONCLUSION As Mr Sanna has failed to establish an arguable case for the relief he seeks, paragraph 4 of the Interlocutory Application should be dismissed. Mr Sanna accepted that if he was unsuccessful, he should pay the Trustee’s and Defined’s costs of the application. However, he requested that the Court reserve on the question of Wyse & Young’s costs. Accordingly, if Wyse & Young wishes to seek an order for its costs it should provide a submission of no more than two pages in support of that application within seven days of the date of publication of these reasons. Mr Sanna is to provide any submission in response, not exceeding two pages in length, within 14 days of the date of publication of these reasons. If that occurs I will determine the question of Wyse & Young’s costs on the papers. I will make orders accordingly.

Ratio Decidendi

Legal Principle Established

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