Zouki v Camilleri

[2001] FMCA 86

FEDERAL MAGISTRATES COURT OF AUSTRALIA

ZOUKI v CAMILLERI  [2001] FMCA 86

BANKRUPTCY – Creditors Petition dismissed by consent – Costs order – discretion where offer to pay debt rejected.

Bankruptcy Act 1966

Applicant: SAM ZOUKI

Respondent: LUCY CAMILLERI

File No:   MZ 292 of 2001

Delivered on: 17 September 2001

Delivered at: Melbourne

Hearing Date: 17 September 2001

Judgment of: McInnis FM

REPRESENTATION

Counsel for the Applicant: Mr B Guzzo

Solicitors for the Applicant: Antony Sdrinis & Co

The Respondent: In Person

ORDERS

BY CONSENT:

1. The creditors petition be dismissed.

FURTHER ORDER:

1. The respondent pay the applicant creditors' costs pursuant to Order 62 of the Federal Court Rules to be taxed in default of agreement up to and including costs incurred by 15 August 2001. 

FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE

MZ 292 of 2001

SAM ZOUKI

Applicant

And

LUCY CAMILLERI

Respondent

REASONS FOR JUDGMENT

1. In this application the applicant creditor seeks orders by consent that the creditors petition be dismissed and that the respondent be ordered to pay the applicant creditors costs.  The applicant creditor claims that numerous adjournments have been granted in this matter and that's evident from the court file which reveals that in fact adjournments occurred on 12 June 2001, 26 June 2001, 10 July 2001, 31 July 2001 and 21 August 2001.  The adjournments until

   
   

   10 September 2001 are all conceded to have been adjournments at the request of the respondent.

2. I should add, however, in that chronology there is a hearing which took place on 21 August 2001 and it would appear that on that day the respondent had finally managed to make appropriate arrangements in order to pay what was a fairly modest outstanding judgment and advised the court of that fact.  The respondent, in her affidavit which is before this court sworn 3 September 2001, deposes to the fact and it seems to be accepted that on the Wednesday prior to 21 August 2001, that is 15 August 2001, she had indicated to the solicitors for and on behalf of the judgment creditor, that she had ultimately arranged finance which would be sufficient to pay the total amount of the judgment and costs and was told that at that stage there had been a further $5000 in legal fees which had been incurred in connection with the creditors petition, and that the petition would not be withdrawn in the absence of payment of those fees. 

3. Not surprisingly, the unrepresented respondent then did not formally tender the amount which was available to her to tender. 

4. At the hearing on 21 August 2001 the matter was further then adjourned to 10 September 2001.  By that date the respondent had in fact been able to tender, as I understand it, the amount of the judgment and costs and the adjournment sought on 10 September 2001 by the judgment creditor was to enable the time to pass for the cheque to be cleared and I am told that has occurred.  There is no doubt in my mind that once a creditors petition has been commenced, and if indeed in circumstances such as the present it is dismissed, that the court has a general discretion as to whether it will or will not order costs.

5. I think it is probably fair to say that on my reading of the material this has been a somewhat sorry saga of personal dispute over a small amount of money, though no doubt a significant amount at the time when it was advanced by the creditor to the debtor.  I make no criticism of either party in relation to that but it just seems to me unfortunate that it has reached this stage.  Ultimately, however, I note that the respondent in her own affidavit says in paragraph 18:

   “The hearing was adjourned on this and several other occasions to enable me to obtain the necessary funds to pay Mr Zouki.  I could not, however, guarantee Mr Zouki as to when the loan would be approved since it was a matter beyond my control.  Therefore I was not able to say when I could pay Mr Zouki.” 

1. I am satisfied that that was the case up until 15 August 2001 but I am also satisfied that although it is an unfortunate case and the circumstances are such that the costs are now significant and would probably equal or even exceed the amount of the original judgment debt and costs, it is appropriate to make some order for costs. The order I propose making allowing for the offer to pay on 15 August 2001 are:- 

BY CONSENT:

(1)The creditors petition be dismissed.

FURTHER ORDER:

(2)The respondent pay the applicant creditors' costs pursuant to Order 62 of the Federal Court Rules to be taxed in default of agreement up to and including costs incurred by 15 August 2001. 

1. In other words, I do not make any order for costs thereafter

I certify that the preceding seven (7) paragraphs are a true copy of the reasons for judgment of McInnis FM

Associate:

Date:    17 September 2001