Westpac Banking Corporation v Strangio - [2008] FMCA 1102

FEDERAL MAGISTRATES COURT OF AUSTRALIA

WESTPAC BANKING CORPORATION v STRANGIO

[2008] FMCA 1102

BANKRUPTCY – Adjournment of creditor’s petition sought and refused – sequestration order made.

Bankruptcy Act 1966 (Cth)

Ahern v Deputy Commissioner of Taxation (Qld) (1987) 76 ALR 137

Applicant:

WESTPAC BANKING CORPORATION

Respondent:

BRUNO STRANGIO

File Number:

MLG 1702 of 2007

Judgment of:

Hartnett FM

Hearing date:

28 July 2008

Delivered at:

Melbourne

Delivered on:

28 July 2008

REPRESENTATION

Counsel for the Applicant:

Mr C J Nichol

Solicitors for the Applicant:

Gadens Lawyers

Counsel for the Respondent:

Mr K A Boden

Solicitors for the Respondent:

Starnet Legal Pty Ltd

ORDERS

Upon hearing the Creditor’s Petition filed 14 December 2007 a sequestration order is made against the estate of Mr Bruno Strangio.
Mr Paul Anthony Pattison be appointed as Trustee of the bankrupt estate of Mr Bruno Strangio.
The costs of these proceedings including all reserved costs be taxed and paid in accordance with the Bankruptcy Act 1966 (Cth).

NOTATION

The date of the act of bankruptcy is 26 October 2007.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLG 1702 of 2007

WESTPAC BANKING CORPORATION

Applicant

And

BRUNO STRANGIO

Respondent

REASONS FOR JUDGMENT

A creditor’s petition was filed on 14 December 2007. It was first returnable on 26 February 2008. The petition was founded upon the failure to comply with a Bankruptcy Notice number VN1747/07 served upon the respondent on 5 October 2007. That bankruptcy notice claimed the respondent owed a debt to the applicant creditor in the amount of $36,144.75, being the amount due and payable by the respondent debtor to the applicant creditor pursuant to an order made on 20 July 2007 in proceedings numbered C1-2203 of 2006 in the County Court of Victoria at Melbourne in the sum of $36,144.75.
Part 2 of the Creditor’s Petition contained an affidavit verifying the petition, paragraphs 1, 2 and 3. An affidavit verifying paragraph 4 of the petition was sworn by Mr Robert Thomas Hinton on the 14th day of December 2007. Filed in court this day were two further affidavits relied upon being an affidavit of search sworn by Robert Thomas Hinton on 28 July 2008 and an affidavit of the ongoing indebtedness of the respondent sworn 28 July 2008 by Mr Ciriaco Nigro.
In response to the Creditor’s Petition, the respondent filed a notice of conditional appearance on 25 February 2008 and a notice stating grounds of opposition to the Creditor’s Petition. An affidavit supporting the grounds of opposition was filed by Mr Strangio on 25 February 2008 and sworn by him on that day.
The first ground raised in the notice of opposition was that the Creditor’s Petition had not been served upon the respondent. The court is satisfied that service was effected upon the respondent. The court accepts the evidence that is contained in the affidavits of Ms Sarah Jane Worsfield sworn the 22nd day of February 2008 and 26 February 2008, together with the affidavits of Ms Louise Mary Rhodes sworn 22…

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: [2008] FMCA 1102
Decision Date: 28 July 2008

CaseChat Overview and Summary

Westpac Banking Corporation filed a creditor's petition against Bruno Strangio, seeking a sequestration order. The dispute was heard in the Federal Circuit Court of Australia. The bank alleged that Mr Strangio had committed an act of bankruptcy by failing to settle debts owed to Westpac. The primary issue before the court was whether Mr Strangio's failure to pay constituted an act of bankruptcy under the Bankruptcy Act 1966 (Cth). The court considered whether the evidence provided by Westpac was sufficient to establish that Mr Strangio was unable to pay his debts and whether he had committed an act of bankruptcy by failing to comply with a bankruptcy notice.

The court examined the evidence provided by Westpac and found it to be sufficient to establish that Mr Strangio had failed to pay his debts as they fell due. The court held that the failure to comply with a bankruptcy notice was an act of bankruptcy under the Bankruptcy Act 1966 (Cth). The court also considered Mr Strangio's submissions in response to the petition but found them to be insufficient to rebut the presumption of bankruptcy. The court concluded that Mr Strangio had committed an act of bankruptcy and made a sequestration order against his estate. The court also appointed Paul Anthony Pattison as Trustee of Mr Strangio's bankrupt estate and ordered that the costs of the proceedings be taxed and paid in accordance with the Bankruptcy Act 1966 (Cth).

Orders

Orders of the court

Upon hearing the Creditor’s Petition filed 14 December 2007 a sequestration order is made against the estate of Mr Bruno Strangio.

Mr Paul Anthony Pattison be appointed as Trustee of the bankrupt estate of Mr Bruno Strangio.

The costs of these proceedings including all reserved costs be taxed and paid in accordance with the Bankruptcy Act 1966 (Cth).

NOTATION

The date of the act of bankruptcy is 26 October 2007.

Background

Background to the litigation

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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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