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[2004] FMCA 1052
procedural. Matter referred back to the Registrar for the hearing of the bankruptcy petition; affidavits accepted for filing and Registrar to make usual costs order (para 12).
The creditor sought to make the debtor bankrupt based on a default judgment. The debtor asked the Federal Magistrate to dismiss the petition or to adjourn it so he could refinance. The Magistrate would not re‑examine the judgment because the Supreme Court had recently considered and refused to set it aside, the debtor had not produced persuasive evidence that the judgment was wrongly obtained, and the proposed defence lacked factual content. The Magistrate also refused an adjournment because there was no affidavit evidence that refinancing was likely, and because public policy and other creditors' interests weighed against delay. The petition was referred back to the Registrar for the usual formal hearing and costs orders.
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1,754 words · generated 07/07/2026
ASX Perpetual Registrars Ltd commenced bankruptcy proceedings against Johny (Frank John) Golubovic founded on a default judgment for $142,698 entered in the Supreme Court of New South Wales on 11 December 2003. The debtor (Golubovic) applied in the Federal Magistrates Court to have the bankruptcy petition dismissed on the basis that, if the magistrate went behind the judgment, he would be satisfied the debt was not genuine. Alternatively, the debtor sought an adjournment so he could refinance his home, thereby avoiding bankruptcy or enabling the current creditor to withdraw its petition (para 1).
No linked legislation citations have been extracted yet.
The Federal Magistrate (Raphael FM) had before him: the Supreme Court default judgment and the minutes of the decision of Barrett J (who ordered judgment by default, but stayed execution until 17 December 2003); evidence that the debtor later applied to Windeyer J in the Supreme Court to set aside the judgment (that application having been dismissed); and the debtor’s proposed defence which Windeyer J did not accept (paras 2–9). The magistrate also had evidence of caveats on the debtor’s property and indications that other creditors were interested (para 10).
Raphael FM refused to dismiss the petition or to adjourn it. He declined to ‘‘go behind’’ the Supreme Court judgment because the debtor had unsuccessfully sought to set it aside and had not presented the kind of evidentiary material that would persuade the court the judgment was wrongful (paras 6–9). He refused the adjournment for refinancing because there was no affidavit or other evidence demonstrating a real prospect of imminent refinancing and because public policy and other creditors’ interests weighed against delay (paras 10–11). The matter was referred to the Registrar for the hearing of the bankruptcy petition's formal requirements and for the usual costs orders (para 12).
Three central considerations drove the decision:
Deference to recent superior-court consideration of the underlying judgment. The magistrate relied on comity and on the practical significance of the Supreme Court’s recent handling of the dispute: Barrett J had entered default judgment after concluding the defendant was ‘‘playing for time’’ and had given the defendant one last chance, and Windeyer J had later dismissed the debtor’s application to set the judgment aside (paras 2–6). In that context the magistrate was “most reluctant to go behind a judgment which has been the subject of consideration so recently by such an authority” (para 9).
The established approach to ‘‘going behind’’ a judgment. Raphael FM cited Wolff v Donovan and Wren v Mahony for the proposition that a court will more readily look behind a judgment obtained by default, but that such readiness depends on whether the debtor has attempted to set the judgment aside and on the strength of any grounds for doing so (para 7). Here the debtor had both delayed and failed in a Supreme Court application; the proposed defence lacked factual substance; accordingly the magistrate considered the debtor had not presented "appropriate evidence" to show there was no debt (paras 6–9).
Public policy and evidentiary standards for adjournment. The court emphasised that bankruptcy is a public‑policy matter as well as a private remedy, and that adjournment to permit refinancing requires firm evidence of a real and imminent prospect of refinancing sufficient to satisfy creditors generally (paras 10–11). The magistrate had evidence of caveats on the property and of other creditors, and no affidavit proving refinancing prospects. He therefore concluded that an adjournment would be inappropriate (paras 10–11).
Those considerations together led to refusal to dismiss or adjourn and to a procedural referral to the Registrar to hear the formalities (para 12).
Before: The legal framework governing when a court may look behind a judgment, particularly a default judgment, is established in the authorities cited: Wren v Mahony and the Full Bench decision in Wolff v Donovan (both cited at para 7). Those authorities recognise that default judgments attract greater scrutiny, but that a debtor's conduct, including efforts to set aside the judgment and timeliness of any such attempts, are highly relevant.
This decision: ASX Perpetual Registrars v Golubovic applies those principles in a practical, fact‑sensitive way. It confirms that a magistrate sitting in bankruptcy will give weight to recent superior court determinations and will require persuasive evidence before re‑opening a judgment. It also reinforces the requirement of specific, contemporaneous evidence to secure an adjournment for refinancing, and it underlines that public policy and other creditors’ interests must be weighed when deciding such applications.
After: The decision does not change the legal framework but exemplifies its application. Practitioners should note that where a debtor seeks to rely on refinancing to avoid bankruptcy, the court expects affidavitised, cogent evidence of an imminent refinancing transaction and its sufficiency for creditors generally. Where a superior court has considered and refused to set aside a judgment, lower courts are likely to be cautious about re‑opening the underlying dispute absent new and compelling evidence.
Passage (Barrett J quoted), para 3: "The whole of the circumstances raise a strong inference that the defendant it playing for time... judgment by default be entered, but that judgment be stayed for a short time..." Plain English: The Supreme Court judge thought the defendant was delaying tactics. He ordered default judgment but gave a short stay so the defendant could make a last effort to challenge it. That approach was to force the defendant to act, not to allow indefinite delay.
Principle (citing Wolff), para 7: "The court will more readily look behind the judgment if it was obtained by default but it is relevant, in this regard, whether any attempt has been made by the judgment debtor to have the judgment set aside." Plain English: If a judgment was entered because the defendant did not respond, the court is more likely to re‑examine it; however, whether the defendant tried to overturn the judgment and how convincing that attempt was matters a lot.
Public policy consideration, para 10: "Bankruptcy is a matter of public policy as well as a method by which resolution of a private debt can be obtained." Plain English: Bankruptcy procedures affect the public interest, not just the parties. That means the court must consider broader consequences when deciding to delay or block bankruptcy proceedings.
Evidentiary expectation for refinancing, para 11: "I should have had before me full evidence ... that there was a real possibility that within a short space of time the refinancing could be obtained..." Plain English: The court expects clear, written proof showing refinancing is likely soon; oral statements in court are not enough.
The decision is most directly relevant where the following elements are present:
In such fact patterns, courts will expect documented, persuasive evidence of refinancing prospects, and will be cautious about reopening judgments recently considered by higher courts.
This decision is a clear, practical application of pre‑existing authority (Wolff; Wren). It is not a landmark that alters the law. Later courts (where they encounter similar fact patterns) can treat ASX Perpetual Registrars v Golubovic as an authority supporting:
Because the Federal Magistrate expressly cited Wolff and Wren (para 7) and relied on them, later decisions are likely to cite this case as an example of the application of those authorities in bankruptcy‑petition practice. The decision also emphasises procedural propriety: applications to adjourn require proper documentary evidence rather than informal oral assurances (para 11).
Several practical and doctrinal questions remain open or require case‑by‑case assessment:
What quantum and specificity of evidence will satisfy the court that refinancing is a ‘‘real possibility’’ within a short time? The judgment requires "full evidence" (para 11) but does not quantify the degree of proof. Practitioners will need to test the boundary with concrete offers, pre‑approval letters, term sheets, or evidence of imminent sale offers.
How should courts treat new evidence that was not before the superior court when the superior court refused to set aside a judgment? The magistrate gave weight to the Supreme Court's decision (para 9), but did not rule out the possibility that new, strong evidence might persuade a magistrate to look behind a judgment. The threshold for what constitutes sufficiently new and compelling evidence remains fact‑sensitive.
The relative roles of oral evidence versus affidavit evidence: Raphael FM stressed affidavit evidence (para 11). But in urgent circumstances might contemporaneous oral testimony be acceptable? The judgment suggests it should not be the primary or sole basis, but courts might accept oral evidence in specific contexts if properly tested.
Interaction with competing creditor interests: The judge relied on the existence of other creditors and caveats (para 10) to refuse adjournment. How competing creditor positions should be weighed against a single creditor’s petition will require assessment in each case, particularly where refinancing might satisfy some but not all creditors.
Scope of comity for decisions of superior courts in other contexts: This case involved a recent Supreme Court consideration of the same dispute. The extent to which lower courts must defer where the superior court’s consideration was limited to interlocutory or procedural concerns, rather than a final determination on the merits, could be developed further.
Conclusion: ASX Perpetual Registrars v Golubovic is a practical exposition of established principles on re‑opening default judgments and on the evidentiary and public‑policy hurdles to adjournments in bankruptcy petitions. It provides clear guidance for practitioners: if you rely on refinancing to defeat a bankruptcy petition, produce affidavitised proof of imminent funding; if you seek to re‑open a judgment recently considered by a superior court, prepare evidence that is new, strong and timely.
BANKRUPTCY - Application to set aside petition or adjourn - where debtor has recently applied without success to have judgment set aside - where Supreme Court of New South Wales has criticised debtor's conduct of proceedings - where there is no real evidence that debtor can refinance - where there is evidence of other creditors - whether public policy considerations apply - whether matter should be referred to Registrar to hear petition.
Wolff v Donovan (1991) FCR 480
Wren v Mahony [1972] HCA 5; (1972) 126 CLR 212
JOHNY GOLUBOVIC (also known as FRANK JOHN GOLUBOVIC)
(1) Matter referred back to the Registrar for the hearing of the bankruptcy petition.
JOHNY GOLUBOVIC (also known as FRANK JOHN GOLUBOVIC)
1. In this matter the respondent debtor seeks that I should dismiss the petition on the grounds that if I went behind the judgment upon which the bankruptcy notice was founded I would be satisfied that there is not a genuine debt, or alternatively that I should adjourn the petition so that the debtor has the opportunity to refinance his home and thus establish either solvency or the ability to repay this particular creditor and have this particular creditor withdraw from the proceedings.
2. The judgment upon which the petition is based was obtained by default. It was not, however, automatic default. The matter came before Barrett J in the Supreme Court of New South Wales on 11 December 2003. His Honour gave a short judgment which is found as Annexure D to an affidavit of Abigail Badman sworn in proceedings before the Supreme Court of New South Wales and dated 10 December 2004.
"The defendant seeks a further extension of time for filing any defence. This is in circumstances where a stay application was made to Hamilton J sitting as a Duty Judge on 2 December and the stay was refused.
The whole of the circumstances raise a strong inference that the defendant it playing for time. The appropriate course to bring matters to a head is that judgment by default be entered, but that judgment be stayed for a short time to give the defendant one last chance to come forward with anything he considers himself capable of coming forward with. It would then be for the defendant to make an application that the judgment be set aside and in that respect positive action to retrieve the position would be required of him, thus crystallising matters one way or the other.
I make orders in the short minutes which I initial and date. I order that execution of the judgment be stayed until 5.00 pm on 17 December 2003.
4. That judgment was entered on 11 December 2003 in the sum of $142,698.
5. The applicant debtor through an affidavit of Lupico Angelovski, his former solicitor, filed in these proceedings and dated 30 November 2004, denies any involvement in the matters that gave rise to the judgment and seeks to explain why the debtor did not take any further steps following the decision of Barrett J until a very short time ago when he made an effort to set aside that judgment by application to Windeyer J in the Supreme Court of New South Wales.
6. I am told by counsel representing the creditor, and I believe it is accepted by counsel representing the debtor, that Windeyer J dismissed that application. Neither of them were able to provide me with a copy of his Honour's judgment but it would appear one of the major factors influencing the decision was the delay in bringing the application at all. However, it seems to me that if this debtor had a very good ground for showing that the judgment had been entered against him wrongfully then Windeyer J would have been more inclined to have acceded to his request that the judgment be set aside.
7. The position in relation to the going behind judgments is seminally considered by the Full Bench of the Federal Court in Wolff v Donovan (1991) FCR 480 where their Honours apply Wren v Mahony [1972] HCA 5; (1972) 126 CLR 212. As it is noted in the head note of Wolff:
"The court will more readily look behind the judgment if it was obtained by default but it is relevant, in this regard, whether any attempt has been made by the judgment debtor to have the judgment set aside."
8. The debtor has shown me a copy of the defence which he had proposed to file in the Supreme Court and which was not accepted by Windeyer J. The defence is short. It admits various paragraphs of the statement of claim and then claims that the defendant does not know and cannot admit several of the others. Certain paragraphs are denied. There is not a single factual statement in the whole document. Counsel for the debtor says there should not be. He says that the allegations made against his client are simply not true. The only thing to do in that case is to deny them.
9. I have some sympathy with that argument but I do not think it is a full answer to the fact that Windeyer J dismissed the application to set aside and to allow the defence in. This court must have some comity with the decisions of the Supreme Court of New South Wales and I would be most reluctant to go behind a judgment which has been the subject of consideration so recently by such an authority as his Honour. It seems to me, in my own view of the matter that the debtor has singularly failed to present appropriate evidence that could persuade me or another Judge in bankruptcy that there was no debt.
10. In regard to the debtor's application for an adjournment so that he can refinance his property the difficulty I have with that is that there is no evidence in front of me that would indicate that this might be possible in the near future. What I do have is evidence of caveats having been placed upon that property and also evidence which goes to my discretion generally that there is at least one other creditor circling this particular debtor. Bankruptcy is a matter of public policy as well as a method by which resolution of a private debt can be obtained. This is not to say that it is a form of an execution upon a judgment. When considering the question of adjournments and the question of whether or not to allow a petition to proceed public policy must also be taken into account.
11. In all the circumstances I am not prepared to grant this adjournment. Counsel for the debtor informed me that his client was on his way and could give evidence but that is not the manner in which these things should be done. I should have had before me full evidence on which the debtor intended to rely to indicate to me that there was a real possibility that within a short space of time the refinancing could be obtained and that he would be able satisfy all his creditors, not just the one who was currently petitioning.
12. In the circumstances and because of the very full lists before me I have decided that the matter should be referred back to the Registrar for the hearing of the bankruptcy petition insofar as the formal requirements are concerned. I have accepted into filing various affidavits which will go before the Registrar in that regard. The Registrar will also make the usual order for costs which presumably will include the costs of the hearing before me.
I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of Raphael FM
ASX Perpetual Registrars Limited
Golubovic [2004] FMCA 1052
(1972) 126 CLR 212
Matter referred back to the Registrar for the hearing of the bankruptcy petition; affidavits accepted for filing and Registrar to make usual costs order (para 12).