Westpac Banking Corporation v Goodman - [2010] FMCA 993

FEDERAL MAGISTRATES COURT OF AUSTRALIA

WESTPAC BANKING CORPORATION v GOODMAN

[2010] FMCA 993

BANKRUPTCY – Sequestration order – whether available act of bankruptcy – whether judgments relied on have been stayed – whether counterclaim which could not have been set up in the proceedings where judgments obtained – whether creditor seeking to prevent debtor taking action against creditor – whether enough to refuse sequestration order – sequestration order made – costs.

Bankruptcy Act 1966, ss.40(1), 41(1), 44(1)(a), 52, 116(2)(b)
Bankruptcy Regulations 1966, reg.6.03
Bankruptcy Legislation Amendment Act 2010, sch.4 (Part 1)

Abigroup Limited v Abignano (1992) 29 FCR 74
Bayne v Blake No. 2 (1909) 9 CLR 360
Bride v KMG Hungerfords (a firm) (unreported) FCA 23 April 1998
Cain v Whyte (1933) 48 CLR 639
Clyne v Deputy Commissioner of Taxation (1984) 52 ALR 657
Goldberg v Morrow [2005] FCA 1038
Goodman v Westpac Banking Corporation [2010] FMCA 714
ICM Agriculture Pty Ltd (ACN 006 077 765) v Young (2009) 260 ALR 515
Radich v Bank of New Zealand (1993) 45 FCR 101
Re Coyne; Ex parte Binningup (South) Pty Ltd (unreported) 10 November 1992
Re King; Ex parte Commercial Bank of Australia Ltd (No.2) [1920] VLR 490
Re Skinners and Smiths Application (1982) 45 ALR 553
Rigg v Baker (2006) 155 FCR 531
Sarina v Council of the Shire of Wollondilly (1980) 32 ALR 596
SCAA v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 668
Totevv Sfar (2008) 5 ABC(NS) 691
Williams v Spautz (1992) 174 CLR 509

Applicant:

WESTPAC BANKING CORPORATION

Respondent:

MORRIS GOODMAN

File Number:

MLG 1059 of 2010

Judgment of:

Turner FM

Hearing date:

15 November 2010

Date of Last Submission:

14 December 2010

Delivered at:

Melbourne

Delivered on:

17 December 2010

REPRESENTATION

Counsel for the Applicant:

Mr Nichol

Solicitors for the Applicant:

Gadens Lawyers

The Respondent appeared In Person

ORDERS

A sequestration order is made against the estate of Mr Morris Goodman.
Mr Warren White be appointed as the trustee of the bankrupt estate of Mr Morris Goodman.
The costs of this matter follow the event and be taxed by the Registrar and paid according to the Bankruptcy Rules.
The interim application filed by the debtor on 4 October 2010 is dismissed.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT MELBOURNE

MLG 1059 of 2010

WESTPAC BANKING CORPORATION

Applicant

And

MORRIS GOODMAN

Respondent

REASONS FOR JUDGMENT

The Court has before it a creditor’s petition by the applicant Westpac Banking Corporation against the respondent Morris Goodman. The petition seeks a sequestration order. Mr Nichols represented the applicant; the respondent was self represented.
For the Court to have jurisdiction to make a sequestration order there must be an available act of bankruptcy within the terms of s.40(1) of the Bankruptcy Act 1966 (the “Act”).
The creditor alleges that the debtor has committed an act of bankruptcy as defined in s.40(1)(g) as follows:
40 Acts of Bankruptcy
(1)A debtor commits an act of bankruptcy in each of the following cases:
…
(g)…

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: [2010] FMCA 993
Decision Date

CaseChat Overview and Summary

The Federal Magistrates Court was asked to decide whether to make a sequestration order against the respondent, Morris Goodman, following a creditor’s petition by the applicant, Westpac Banking Corporation. The applicant alleged that the debtor had committed an act of bankruptcy under s.40(1)(g) of the Bankruptcy Act 1966 (the “Act”) in that the debtor had failed to comply with a bankruptcy notice served on him. The debtor argued that the bankruptcy notice should be set aside because the debt was not a final judgment, and that the applicant had an ulterior motive in presenting the creditor’s petition. The Court found that the debtor had committed an act of bankruptcy and dismissed the debtor’s application to set aside the bankruptcy notice. The Court then made the sequestration order sought by the applicant, and appointed a trustee for the debtor’s estate. The Court also ordered that the costs of the matter follow the event and be taxed by the Registrar and paid according to the Bankruptcy Rules. The Court dismissed the interim application filed by the debtor on 4 October 2010.

Orders