Woolley v Spagnol - [2016] FCCA 94

FEDERAL CIRCUIT COURT OF AUSTRALIA

WOOLLEY v SPAGNOL

[2016] FCCA 94

Catchwords:
COSTS – Application to set aside bankruptcy notice – orders made by consent setting aside bankruptcy notice – whether issue of bankruptcy notice was an abuse of process or the circumstances were otherwise such as to warrant an award of indemnity costs.

Legislation:

Bankruptcy Act 1966 (Cth), s.32
Family Law Act 1975 (Cth), s.90G
Federal Circuit Court of Australia Act 1999 (Cth), s.79

HWY Rent Pty Ltd v HWY Rentals (in liq) (No 2) [2014] FCA 449
Lord & Anor v Rankine & Ors [2010] FMCA 668
Rankine v Lord [2011] FCA 478

Applicant:

JOHN PHILIP WOOLLEY

Respondent:

SUZANNE LEIGH SPAGNOL

File Number:

SYG 2935 of 2014

Judgment of:

Judge Barnes

Hearing date:

Determined on the papers

Date of Last Submission:

7 October 2015

Delivered at:

Sydney

Delivered on:

4 February 2016

REPRESENTATION

Counsel for the Applicant:

Mr J. Johnson

Solicitors for the Applicant:

Hall Partners

Counsel for the Respondent:

Mr R. Lethbridge SC and Ms G. Eldershaw

Solicitors for the Respondent:

Searle & Associates Lawyers

ORDERS

The Respondent pay the costs of the Applicant as agreed and in the absence of agreement taxed in accordance with the Federal Court Rules.

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT SYDNEY

SYG 2935 of 2014

JOHN PHILIP WOOLLEY

Applicant

And

SUZANNE LEIGH SPAGNOL

Respondent

REASONS FOR JUDGMENT

On 22 October 2014 the Applicant, Mr Woolley, filed an application to set aside a bankruptcy notice issued on 9 October 2014 in which the Respondent, Ms Spagnol, relied on a claimed debt of $423,990.68.
Mr Woolley filed an amended application on 28 January 2015 in which he sought that the bankruptcy notice be set aside and (unusually) that several declarations be made as to asserted technical defects in the bankruptcy notice. In particular he sought:
A Declaration that the calculation of the amount outstanding under the final judgement or order relied upon (being the orders of the Family Court of Australia made on 11 February 2011 as amended on 11 December 2013) where calculated according to the general principles of law contains an overstatement both as to interest and as to principal, to the extent that the Respondent seeks to treat payments made in terms of the final judgement or order otherwise than as being payments in respect of the final judgement or order and that is claimed in the bankruptcy notice, namely spousal maintenance, where there was no extant spousal maintenance proceeding; the final judgement or order relied upon and only judgement or order relied upon being that arising by virtue of the judgement and subsequent orders of Justice Benjamin on 11 February 2010 and which concerns the Financial Agreement entered into between the Applicant and the Respondent that is dated 29 September 2005.
In an affidavit relied on in support of the Amended Application, sworn by Cameron Khosravi on 24 November 2014, Mr Woolley’s solicitor asserted generally that the issue of the bankruptcy notice to seek payment of a disputed sum…

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.

Continue reading Woolley v Spagnol

Details

AGLC: Woolley v Spagnol [2016] FCCA 94
Case: [2016] FCCA 94
Decision Date: 4 February 2016

CaseChat Overview and Summary

Woolley v Spagnol concerned a dispute between a vendor, Ms. Woolley, and a purchaser, Mr. Spagnol, regarding a contract for the sale of a residential property. The purchaser sought to terminate the contract, alleging that the vendor had breached a contractual term requiring the property to be vacant on settlement. The matter came before Judge Barnes in the County Court of Victoria.

The central legal issue before the court was whether the vendor's failure to ensure the property was vacant on the settlement date constituted a repudiatory breach of the contract, thereby entitling the purchaser to terminate. This required the court to consider the nature of the contractual term in question and the consequences of its breach in the context of a standard contract for the sale of land.

Judge Barnes found that the vendor's obligation to deliver vacant possession was a fundamental term of the contract. The evidence established that at the time of settlement, the property was not vacant, as a tenant remained in occupation. The court held that this failure amounted to a repudiatory breach, as it deprived the purchaser of a substantial part of the benefit they were to receive under the contract. The purchaser was therefore entitled to accept the repudiation and terminate the agreement.

Consequently, Judge Barnes made orders declaring the contract terminated and directing the vendor to refund the deposit paid by the purchaser.

Orders