Owners of Majestic Rise and Majestic Crest Apartments Strata Plan 40793 v Spiro

Federal Court of Australia|2023-06-30|Before: Smith J

The registrar's order made 28 November 2022 is affirmed.
The respondents' application for review is otherwise dismissed.
Subject to order 4, the respondents are to pay the applicant's costs to be taxed by a registrar of this Court on a lump sum basis if not agreed.
If any party seeks a different costs order to order 3, they may file a minute of the proposed costs order they seek and file written submissions in support of that order, limited to five pages, within seven days. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BANKS-SMITH J: 1 Mr Terry Spiro and Mrs Ellen Spiro were made bankrupt by orders of a registrar of this Court on 28 November 2022, having failed to comply with a bankruptcy notice dated 9 August 2021. The debt referred to in the bankruptcy notice is a judgment debt, reflected in orders of the Magistrates Court of Western Australia. 2 The judgment debt relates to strata levies, charges and legal costs sought to be recovered by the Strata Company of the Majestic Rise and Majestic Crest Apartments, which is the applicant in the bankruptcy proceeding, but the respondent to this application. Mr and Mrs Spiro own an apartment in that development. 3 Mr and Mrs Spiro applied to set aside the bankruptcy notice, but on 29 July 2022 the application was refused, with reasons published by the registrar (set aside reasons). 4 The Strata Company issued a creditor's petition dated 24 August 2022. It is premised upon failure to comply with the bankruptcy notice, and recites a total outstanding debt in the sum of $50,006.06. It was duly served on the debtors. 5 Mr and Mrs Spiro sought and were granted two adjournments of the scheduled hearing of the petition by the registrar. 6 In the end a third application for an adjournment was dismissed, the petition was heard on 28 November 2022, extempore reasons were given, and a sequestration order was made on the same day. 7 By this proceeding Mr and Mrs Spiro seek a review of the sequestration order.

The judgment debt 8 The judgment debt arose after an agreement was reached between the parties with respect to proceedings in the Magistrates Court that were reflected in a Heads of Agreement. A consent judgment was entered by the Magistrates Court on 10 August 2020. At the time, Mr and Mrs Spiro were represented by lawyers. They failed to pay certain instalments as required under the Heads of Agreement. They also agreed to pay costs of the proceeding, reflected in a 'notice of admission' and second orders dated 12 May 2021. Another amount of $1500 was the subject of a third order of the Magistrates Court dated 9 July 2021, being the costs of an unsuccessful stay application. The amount set out in the respective orders was not paid in full. These matters are addressed in more detail below.

The bankruptcy notice 9 The bankruptcy notice claims that Mr and Mrs Spiro owe the net sum of $47,261.58, made up of $61,788.04 (the sum of the three orders), plus accrued interest of $1570.40, less credit for payments made of $16,096.86. It was served on Mr Spiro on 1 September 2021 and on Mrs Spiro on 6 September 2021.

Application to set aside bankruptcy notice unsuccessful 10 It appears from the set aside reasons that Mr and Mrs Spiro raised a number of contentions as to why it was said the bankruptcy notice should be set aside. It is apparent that the registrar made a considerable effort to extract from the somewhat obtuse affidavit evidence the arguments that Mr and Mrs Spiro were seeking to pursue. 11 According to the registrar, the approach of Mr and Mrs Spiro was 'essentially to suggest, without clear evidence in support, that the [Strata Company] has for an extended period of time sought to charge amounts to strata owners, including [Mr and Mrs Spiro], without [them] being satisfied as to the proper basis for those charges' (para 55 of set aside reasons). 12 Mr and Mrs Spiro then claimed that the State Administrative Tribunal (SAT) should review all of the charges sought to be recovered from strata owners over an extended period. Proceedings later commenced in SAT were dismissed without hearing. Leave to bring fresh proceedings in SAT was granted (Spiro [2022] WASAT 29). President Pritchard, in granting leave, made it clear that nothing in that grant should be seen as an indication of the merits of the proposed application, and her Honour referred to a number of problems Mr and Mrs Spiro faced. Despite the grant of leave, no new proceeding had been instituted at the time of the set aside hearing. 13 The registrar was not satisfied that there was any reason the matters referred to by Mr and Mrs Spiro could not have been raised in the Magistrates Court proceeding. The registrar was not satisfied that Mr and Mrs Spiro had a counter-claim, set-off or cross demand equal to or exceeding the amount referred to in the bankruptcy notice, being a claim that they could not have set up in the Magistrates Court proceeding. Accordingly, Mr and Mrs Spiro did not satisfy the registrar that s 40(1)(g) of the Bankruptcy Act 1966 (Cth) could be invoked in their favour. 14 Further, as to the purported SAT proceeding, the registrar was not satisfied that the matters raised in the dismissed SAT proceeding, or in any new SAT proceeding, would be of such a nature and requisite strength that Mr and Mrs Spiro should be permitted to pursue that proceeding rather than face bankruptcy, citing the summary of the principles in CFB18 v Reader Lawyers & Mediators [2018] FCA 611 (Colvin J). 15 Nor was the registrar satisfied that anything in the conduct of the Strata Company amounted to an abuse of process, noting no evidence of any collateral or improper purpose, and that it was open to the Strata Company to pursue the debt due to it in bankruptcy proceedings, citing (among other cases): Royal v Nazloomian, in the matter of Royal [2019] FCA 555 at [67], [74] (Stewart J); and Slack v Bottoms English Solicitors [2002] FCA 1445 at [21] (Spender J).

The petition 16 The petition was then issued and served. 17 Following adjournments at Mr and Mrs Spiro's request, the hearing of the petition was listed on 28 November 2022. On that date Mr and Mrs Spiro sought a further adjournment but it was refused, and the sequestration order was made. 18 The registrar, addressing both the adjournment application and the petition, concluded by saying, relevantly: I note that there is no evidence before me in this petition as to whether there even is any current proceeding in the State Administrative Tribunal. However, even if there is, I simply do not see any basis for such a proceeding to warrant any adjournment of this petition. This petition relates to a debt that, on the evidence filed by the applicant creditor, arises from a judgment or orders from the Magistrates Court of Western Australia that constitute a final judgment for the purposes of the issue of a bankruptcy notice. The clear evidence before me is also that the debt the subject of the bankruptcy notice remains unpaid. Anything that may be occurring or may occur in the future in the State Administrative Tribunal is not in any way an appeal against the judgment or orders upon which this creditor's petition proceeds. Likewise, anything that may or may not be happening in the State Administrative Tribunal does not change the position that final judgments or orders were made by the Magistrates Court. None of those judgments or orders have been set aside or overturned on any appeal. Those judgments or orders therefore remain valid and to their full effect. A bankruptcy notice has been issued based on those unsatisfied judgments or orders, and there was no compliance with the bankruptcy notice within the time period for compliance, which includes the significant extension of that time period by reason of the ultimately unsuccessful application made to set aside that bankruptcy notice. There is nothing in the affidavits filed by the respondents in this proceeding that suggests to me there is any basis to go behind the Magistrates Court judgments or orders. Instead, I am satisfied from the evidence that the respondents - having failed to comply with the bankruptcy notice or have it set aside - each of them committed an act of bankruptcy on 19 August 2022, being the final date for compliance with a bankruptcy notice in accordance with the orders that were made by me in the application to set aside the bankruptcy notice. As a result of that, there is a presumption of insolvency. 19 Because this is a review application, it is not necessary to further recount the registrar's reasons. It suffices to say that the registrar also addressed an argument by Mr Spiro as to his alleged capacity to pay the debt if given time, based on speculative future trading and loans, and the absence of any other sufficient cause to refuse a sequestration order.

The registrar's delegated power and the right of review 20 As explained in Bechara v Bates [2021] FCAFC 34; (2021) 286 FCR 166 at [1], the judicial power of the Commonwealth may only be exercised by judges of federal courts. However, federal judicial power may be delegated to registrars if the power exercised by them is subject to review or appeal by a judge or judges of the Court: Harris v Caladine (1991) 172 CLR 84 at 94-95. 21 A registrar is entitled to exercise the power of this Court to make a sequestration order by s 35A(1)(h) of the Federal Court of Australia Act 1976 (Cth), read with r 2.02 and Part 1, Schedule 1of the Federal Court (Bankruptcy) Rules 2016 (Cth). 22 Section 35A(6) of the Federal Court of Australia Act provides for a review from a decision of a registrar. Such a review is a rehearing de novo and the parties are not bound by or limited to the evidence that was before the registrar. It is a hearing on the evidence and the law as at the time of review: Bechara v Bates at [17]; and Totev v Sfar [2008] FCAFC 35; (2008) 167 FCR 193.

Evidence 23 Mr Spiro filed additional affidavits for the purpose of the application before me. The Strata Company also filed new affidavits, but they related to proof of the formal matters within the stipulated time frame of a hearing: r 4.06 Federal Court (Bankruptcy) Rules; and Totev v Sfar at [14]-[15]. 24 Otherwise the parties relied on the affidavits that had been filed for the purpose of the previous proceedings (WAD 180 of 2022 and WAD 216 of 2021) as if they had all been filed in the review application. 25 For completeness, as to the evidence relied upon by Mr and Mrs Spiro, I have had regard to the 10 affidavits of Mr Spiro filed respectively on 20 September 2021, 9 November 2021, 11 February 2022, 4 March 2022, 29 September 2022, 24 October 2022, 22 November 2022, 23 November 2022, 19 December 2022 and 28 February 2023. 26 I have also had regard in particular to the affidavits provided by William Thiel (Chairperson of the Council of Owners for the Strata Company) filed 25 October 2021 and James Marzec (solicitor for the Strata Company) filed 23 August 2022, in addition to those affidavits filed on behalf of the Strata Company to prove the formal matters.

Statutory context 27 Mr and Mrs Spiro did not include any ground of review or particulars in their review application, save to say that a bankrupt's only obligation was to show 'sufficient cause' under s 52(2) of the Bankruptcy Act. 28 Although their review application was wrongly brought purportedly under s 104 of the Federal Circuit Court of Australia Act 1999 (Cth), the Strata Company through counsel sensibly accepted at a case management hearing that the Court would proceed on the basis that this is an application for review under s 35A(6) of the Federal Court of Australia Act. So much was again confirmed at the commencement of the hearing. 29 The making of a sequestration order has significant consequences. Therefore, the Bankruptcy Act, unsurprisingly, requires proof of specific criteria before an order is made. These are set out in s 52(1) of the Bankruptcy Act. Section 52(2) empowers the Court to dismiss the petition. 30 Section 52 relevantly provides: 52 Proceedings and order on creditor's petition (1) At the hearing of a creditor's petition, the Court shall require proof of: (a) the matters stated in the petition (for which purpose the Court may accept the affidavit verifying the petition as sufficient); (b) service of the petition; and (c) the fact that the debt or debts on which the petitioning creditor relies is or are still owing; and, if it is satisfied with the proof of those matters, may make a sequestration order against the estate of the debtor. … (2) If the Court is not satisfied with the proof of any of those matters, or is satisfied by the debtor: (a) that he or she is able to pay his or her debts; or (b) that for other sufficient cause a sequestration order ought not to be made; it may dismiss the petition. 31 The Full Court explained the Court's powers as to dismissal or adjournment of a petition in Endresz v Australian Securities and Investments Commission (No 2) [2015] FCAFC 33; (2015) 228 FCR 334: [37] The circumstances which may constitute 'other sufficient cause' are extremely variable, and it is inappropriate to catalogue or circumscribe them (Clyne v Deputy Commissioner of Taxation (1985) 5 FCR 1 at 5 per Fisher, Morling and Wilcox JJ and Cain v Whyte at 645). But even if 'other sufficient cause' has been shown, that merely enlivens the Court's discretion to refuse to make a sequestration order. The power in s 52(2) is permissive, not mandatory. Even if a debtor can bring himself within s 52(2)(b), that does not entitle him to have a sequestration order refused (Russell v Polites at [24] per Flick J).

Mr and Mrs Spiro's submissions 32 It is necessary to distil the grounds upon which Mr and Mrs Spiro rely from their written and oral submissions. In summary, they contend that: (a) a registrar does not have power to make a sequestration order; (b) neither a debt nor a final judgment has been substantiated, a final judgment is a precondition to the issuing of a bankruptcy notice, and there are ongoing proceedings in the Western Australian Supreme Court and SAT which must be finalised before any bankruptcy proceeding can be pursued; (c) the issue of the bankruptcy proceeding is an abuse of process; and (d) they are not insolvent.

Power of a registrar 33 This matter can be addressed briefly. For the reasons given above at [20]-[22], this argument cannot be accepted. The registrar had delegated power to make the sequestration order against the estates of Mr and Mrs Spiro, and they are now exercising their entitlement to seek a review by way of a hearing de novo.

Debt or judgment not substantiated 34 These submissions are more difficult to distil, particularly as there was no real regard by the parties to the legal principles or relevant authorities. 35 In summary Mr and Mrs Spiro contended that there remain disputes about the amount of strata fees levied against them and that the debt that underlies the judgment debt is not owed, but remains to be dealt with by proceedings in SAT. 36 There were many contentions wrapped up in these submissions and it was not easy to discern any evidence to support some of the allegations. Much of the affidavit evidence amounted to submission and speculation, rather than admissible evidence. Accepting that Mr and Mrs Spiro are self-represented, I have attempted to delve as deeply as is fairly possible into their complaints, although, as will be seen, I have not been persuaded that their submissions in this regard have force. 37 Before addressing the various contentions it is useful to address three matters.

Section 52(2) and any sufficient cause 38 The first is that the submissions and evidence need to be viewed in the context of s 52(2) of the Bankruptcy Act and whether for other sufficient cause a sequestration order ought not be made. The parties did not take me to any authorities in this regard. 39 I recently canvassed the authorities with respect to reliance on a purported cross claim in Arwon Finance Pty Ltd v Wilson (No 2) [2023] FCA 657 at [46]-[49], and I refer to those passages without repeating them. 40 And again although not referred to by the parties, I note that another line of authorities that might be relevant based on the submissions are those referring to attempts to go behind a judgment debt, and the limited circumstances where that might be undertaken. The Court has a discretion whether to accept a judgment as the required proof of debt: Wren v Mahoney (1972) 126 CLR 212 at 224 (Barwick CJ, with whom Windeyer and Owen JJ agreed) where it was said: The judgment is never conclusive in bankruptcy. It does not always represent itself as the relevant debt of the petitioning creditor, even though under the general law, the prior existing debt has merged in a judgment. But the Bankruptcy Court may accept the judgment as satisfactory proof of the petitioning creditor's debt. In that sense that court has a discretion. It may or may not so accept the judgment. But it has been made quite clear by the decisions of the past that where reason is shown for questioning whether behind the judgment or as it is said, as the consideration for it, there was in truth and reality a debt due to the petitioning creditor, the Court of Bankruptcy can no longer accept the judgment as such satisfactory proof. It must then exercise its power, or if you will, its discretion to look at what is behind the judgment: to what is its consideration. 41 The principles were addressed by the High Court in Ramsay Health Care Australia Pty Ltd v Compton [2017] HCA 28; (2017) 261 CLR 132. The plurality observed that: [68] For the purposes of s 52 of the Act, a judgment may usually be taken to be sufficient evidence of a debt in that a judgment against a debtor in favour of a creditor obtained after a trial is, generally speaking, a reliable indication of the true state of indebtedness as between creditor and debtor. Indeed, such a judgment can usually be expected to provide the most reliable statement of the debt humanly attainable because the ordinary processes of the adversarial system provide a practical guarantee of reliability. The testing of the relative merits of a claim and counterclaim under the rigours of adversarial litigation will usually establish the true state of accounts as between the parties to the proceedings. Accordingly, a Bankruptcy Court will usually have no occasion to investigate whether the judgment debt is a true reflection of the real debt. But where the merits of a claim and counterclaim have not been tested in adversarial litigation, a judgment debt will not have this practical guarantee of reliability. (footnotes omitted)

The Strata Titles Act 1985 (WA) 42 The second matter is s 36 of the Strata Titles Act 1985 (WA). At the relevant time, s 36 provided for the establishment of a mandatory administrative fund and a discretionary reserve fund. It permitted levying of contributions on proprietors and the recovery of outstanding contribution as a debt in a court of competent jurisdiction. Relevantly, s 36 provided as follows: 36 Levy of contributions on proprietors (1) A strata company shall - (a) establish a fund for administrative expenses that is sufficient in the opinion of the company for the control and management of the common property, for the payment of any premiums of insurance and the discharge of any other obligation of the strata company; and (b) determine from time to time the amounts to be raised for the purposes described in paragraph (a); and (c) raise amounts so determined by levying contributions on proprietors - (i) in proportion to the unit entitlements of their respective lots; or (ii) where a by‑law referred to in section 42B or an order under section 99A is in force, in accordance with that by‑law or order; and (d) recover from any proprietor, by action in a court of competent jurisdiction if necessary, any sum of money expended by the company for repairs or work done by it or at its direction in complying with any notice or order of a competent public authority or local government in respect of that portion of the building comprising the lot of that proprietor. … (2) A strata company may - (a) establish a reserve fund for the purpose of accumulating funds to meet contingent expenses, other than those of a routine nature, and other major expenses of the strata company likely to arise in the future; (b) determine from time to time the amounts to be raised for the purpose described in paragraph (a); and (c) raise amounts so determined by levying contributions on the proprietors in proportion to the unit entitlements of their respective lots. (3) Except in so far as and to the extent that the by‑laws of a strata company may empower the council of that company to exercise the functions in subsections (1)(a), (b) and (c) and (2), those functions shall be performed by and in accordance with resolutions of proprietors passed at a general meeting of the strata company. (4) Any contribution levied under this section - (a) becomes due and payable to the strata company in accordance with the terms of the decision to make the levy; and (b) if not paid when it becomes due and payable, bears interest on the amount unpaid at the rate of simple interest prescribed, unless the company determines (either generally or in a particular case) that an unpaid contribution shall bear no interest or interest at a lesser rate; and (c) including interest accrued under paragraph (b), may be recovered as a debt by the strata company in a court of competent jurisdiction and the strata company may agree to a compromise of such a debt. (5) Interest paid or recovered under subsection (4) or (6) shall form part of the fund to which the contribution belongs. … 43 I add that I was not taken to any relevant by-laws or other documents relevant to the powers of the Strata Company.

Events leading to the bankruptcy notice and petition 44 The third matter is the history that culminated in the issue of the bankruptcy notice and petition. These are addressed primarily by Mr Thiel in affidavit evidence on behalf of the Strata Company, filed in the set aside application but relied on in this application. 45 Mr Thiel was at the time of the set aside application a current member and Chairperson of the Council of Owners for the Strata Company and, according to his affidavit, was authorised to provide evidence on the Strata Company's behalf. 46 Mr Thiel deposed to the following matters (including by reference to attached documents): (1) The civil proceedings giving rise to the judgment debt upon which the bankruptcy notices were premised were commenced in the Magistrates Court on 27 July 2018. (2) By those proceedings the Strata Company sought to recover against Mr and Mrs Spiro (the owners of Lot 29 within Strata Plan 40793) payments owed for unpaid strata levies, associated penalties and interest. (3) The amended statement of general procedure claim (Form 19) itemises the amounts levied for both the administrative fund and the reserve fund and the due dates, being dates between 1 June 2016 and 30 June 2018. (4) Mr and Mrs Spiro, who at the time were legally represented, filed a defence to the general procedure claim (Form 21) in which they contended relevantly that the Strata Company had purported to levy contributions against them but that they were not obliged to pay such levies under any agreement, the Strata Titles Act, or the Strata Company's by-laws and contended that the Magistrates Court had no jurisdiction to decide matters under the Strata Titles Act. (5) Mr and Mrs Spiro also filed a counterclaim (Form 19A) in which they sought payment of the amount of $9,151.03 from the Strata Company together with other amounts that might be determined by the Court following an inspection of Strata Company records. (6) The Strata Company filed a defence to the counterclaim (Form 21A) which states that it established funds under s 36(1)(a) of the Strata Titles Act, and caused to be determined by resolution of proprietors passed at a general meeting the amounts to be raised, and raised such amounts, as required under s 36(1)(b) and (c). (7) The Form 21A also recorded that the Strata Company established a fund under s 36(2) of the Strata Titles Act and caused to be determined by resolution of proprietors passed at a general meeting the amount to be raised, and raised such amounts, as required under s 36(2)(b) and (c). (8) The Form 21A also recorded that Mr and Mrs Spiro by their former legal representative had conducted an inspection of the Strata Company's records after a written request to do so. (9) The matter was set down for trial on 10 August 2020. (10) On the date of the trial the parties executed a Heads of Agreement recording a settlement of the dispute. Mr Thiel executed it for and on behalf of the Strata Company. (11) As a condition of the Heads of Agreement, the parties consented to orders being entered by way of judgment in favour of the Strata Company. The consent judgment was in the sum of $32,730.20, being the sum of $22,402.20 in principal and $10,328.00 by way of interest, together with an order that Mr and Mrs Spiro pay the Strata Company's costs including reserved costs, to be taxed if not agreed. (12) Under the Heads of Agreement, the judgment sum was to be paid by Mr and Mrs Spiro by 10 February 2021; they were to make instalment payments towards the judgment sum of a minimum of $3,000 per month, with the first payment to be made on 31 August 2020 and then on the last business day of each month; and the Strata Company undertook not to enforce the judgment sum prior to 11 February 2021, unless there was a default in payment of the monthly instalments referred to in the Heads of Agreement. (13) According to correspondence in evidence, the parties agreed on 19 September 2020 that the amount of costs to be paid under the judgment was $25,000. (14) Mr Thiel stated that Mr and Mrs Spiro made regular payments under the Heads of Agreement between August 2020 and December 2020, but did not repay the judgment sum in full by 10 February 2021. (15) The Strata Company instructed its solicitors to write to Mr and Mrs Spiro's lawyers on 19 March 2021, making demand for the outstanding amount and providing a spreadsheet calculation of the outstanding amount (which included the application of amounts paid and an amount for certain new levies). (16) On 8 April 2021 the solicitors for Mr and Mrs Spiro wrote to the Strata Company's lawyers noting that regular payments had been made, foreshadowing a need to propose payment by ongoing instalments due to cash flow issues, and proposing that payments continue in the interim by instalments. The letter also raised some queries about the calculations and sought some time to consider those figures. It referred to the previously foreshadowed application to SAT and attached on a without prejudice basis a draft application. (17) The legal costs of the proceedings were admitted by Mr and Mrs Spiro by way of 'notices of admission of claim' dated 12 May 2021, which constitute separate judgment sums of $27,557.84 against Mr Spiro and $27,652.03 against Mrs Spiro (and I assume the amounts above the agreed $25,000 reflect an interest component). (18) It appears from the Response (defined below) that a means hearing was held in the Magistrates Court on 15 June 2021 - that application was adjourned with costs awarded in favour of the Strata Company and was later abandoned. (19) It appears from the Response that on 9 July 2021 the Magistrates Court also dismissed a motion brought by Mr and Mrs Spiro to suspend enforcement of the judgments and ordered that Mr and Mrs Spiro pay the costs of that motion ($1,500). 47 Copies of the Forms 19, 19A, 21 and 21A filed in the Magistrates Court proceedings referred to above were in evidence, together with copies of the Heads of Agreement, the formal court judgment reflecting the consent judgment, the notices of admissions and the $1,500 costs order. The notice of admission with respect to Mr Spiro is endorsed with the words, 'I have today given judgment in favour of the claimant for the amount claimed together with interest of $0.00, totalling $27,557.84'. An identical judgment on the notice of admission was made with respect to Mrs Spiro but in the sum of $27,652.03. There was no issue that their liability for costs was joint and several. I also note that separately Mr Spiro adduced in evidence an email from his lawyers that advised him to the effect that the Magistrates Court had entered judgment for the admitted amounts for costs, and that it had not made an order that the costs judgment sum be paid by instalments. 48 By application dated 8 June 2021, Mr and Mrs Spiro lodged proceedings in the SAT under s 197 of the Strata Titles Act for the resolution of a 'scheme dispute'. The matters alleged overlap with some of the matters the subject of the Magistrates Court proceedings. The application broadly seeks declarations and answers to a number of questions as to whether levies were improperly imposed, resolutions were properly passed or recorded, agendas and minutes were accurately kept and other alleged management issues with respect to the Strata Company. All matters alleged by Mr and Mrs Spiro are disputed by the Strata Company. A copy of the statement of issues, facts and contention (Statement) and the Strata Company's response and respondent's issues, facts and contentions (Response) was attached to Mr Thiel's affidavit (excluding an evidence bundle that is referred to in the Response). 49 On 1 September 2021 and 6 September 2021 the bankruptcy notice was served. 50 On 6 January 2022 the SAT proceeding was withdrawn and dismissed. So much is not in issue, and is referred to by the registrar in the set aside reasons in the following terms: 88. What is clear from the publicly available information on the eCourts Portal of Western Australia is that on 6 January 2022 Member Petrucci made the following order in the Original SAT Proceedings, a copy of which is also annexed to the First Marzec Affidavit: 'Pursuant to s 46(1) of the State Administrative Tribunal Act 2004 (WA) the applicant has leave to withdraw this proceeding and the proceeding is dismissed pursuant to s 46(2) of the State Administrative Tribunal Act 2004 (WA).' 89. Section 46 of the State Administrative Tribunal Act 2004 (WA) states as follows: 46. Dismissing proceeding on withdrawal or for want of prosecution (1) If the Tribunal gives leave, the applicant may withdraw or agree to the withdrawal of a proceeding or a part of a proceeding. (2) The Tribunal may make an order dismissing or striking out all, or any part, of a proceeding before it if the applicant withdraws or agrees to the withdrawal of the proceeding or that part of it. (3) At any time, the Tribunal may make an order dismissing or striking out all, or any part, of a proceeding before it for want of prosecution. (4) The Tribunal's power to make an order under subsection (3) is exercisable only by a legally qualified member. (5) The Tribunal may make an order under this section on the application of a party or on its own initiative. 90. The Second Marzec Affidavit includes as Annexure A a copy of the transcript of the hearing before Member Petrucci on 6 January 2022 in the Original SAT Proceedings. This transcript provides further context in relation to the circumstances leading to the order being made by Member Petrucci. In particular, the transcript records that Member Petrucci clearly explained to the Applicants that: '…I would make the order under subsection 46(2), 46, subsection (2) of the State Administrative Tribunal Act that I will give you leave to withdraw your application, and that the proceeding is dismissed, it's not simply just withdrawn, and that will be the end of the matter.' 91. Among other things, the transcript of the State Administrative Tribunal hearing on 6 January 2022 also includes some indications by Member Petrucci that the Applicants appeared to face some significant challenges in respect of the types of declarations being sought by them in the Original SAT Proceedings, in particular due to the outcome of a previous State Administrative Tribunal matter involving the Tri Star Group, being an entity associated with the Applicants. 92. The Original SAT Proceedings having been dismissed by Member Petrucci, the terms of section 49 of the State Administrative Tribunal Act 2004 (WA) make clear that the Applicants were then unable to commence a proceeding of the same kind without the leave of a judicial member. 93. At the time of hearing of this Application, it was apparent that such leave had been granted, with the Applicants having provided to the Court a copy of an order made by President Pritchard in the State Administrative Tribunal on 10 March 2022 in the following terms: 'Pursuant to s 49 of the State Administrative Tribunal Act 2004 (WA) Mr Terry Peter Spiro and Mrs Ellen Ann Spiro have leave to commence a proceeding in the Tribunal in the terms of the proposed application dated 4 March 2022.' 51 I was informed by Mr Spiro from the bar table that new SAT proceedings were filed sometime earlier this year and were accepted by SAT on 10 May 2023. 52 I was not provided with any evidence about the 'new' SAT proceedings. Mr Spiro said he did not submit to the Court that it was underway because of a misunderstanding. I was informed at the end of the review hearing that there is a SAT hearing on Friday, 30 June 2023 (the nature of the hearing is unclear) and that the trustee in bankruptcy had indicated he would not pursue the SAT proceeding. I indicated I would attempt to publish these reasons ahead of the SAT hearing in order to assist Mr and Mrs Spiro by providing them with some certainty about their position.

The central theme of the 'debt not substantiated' submission 53 Against that backdrop, Mr Spiro submitted before me that there is no judgment debt; that there was no resolution made by the Strata Company to set contribution levies; that no resolution was passed to authorise the proceedings against him and his wife or the issue of the bankruptcy notice; that he has received no evidence of the quantum of the debt he is said to owe; that the solicitors have not been authorised to act on behalf of the Strata Company; that some of the documents referred to a 'sinking fund' and the Strata Titles Act did not permit such a fund; that the Heads of Agreement specified that he would make payments and that judgment would be entered but that it was entered into 'under protest'; that the Heads of Agreement stated that SAT proceedings would still ensue; that there was no entitlement to costs of the Magistrates Court proceedings; that the matters relating to the levies still need to be sorted out; that payments he had made had not been credited; that the task of sorting out the levies would be undertaken by SAT; that there has been mismanagement of the Strata Company; that Mr Thiel has no authority to act on behalf of the Council of Owners or the Strata Company; the state of the Strata Company's records is in disarray; the conduct and language of Mr Thiel weigh against reliance on the bankruptcy notice and petition; and that everything should await the resolution of all of the issues by SAT. 54 I will return to these matters.

Final judgment as precondition to issue of bankruptcy notice 55 This third main submission of Mr and Mrs Spiro appears to challenge reliance on the judgments of the Magistrates Court for the purpose of bankruptcy proceedings. 56 Section 40(1)(g) and s 40(3) of the Bankruptcy Act relevantly provide: (1) A debtor commits an act of bankruptcy in each of the following cases: … (g) if a creditor who has obtained against the debtor a final judgment or final order, being a judgment or order the execution of which has not been stayed, has served on the debtor in Australia or, by leave of the Court, elsewhere, a bankruptcy notice under this Act and the debtor does not: (i) where the notice was served in Australia - within the time fixed for compliance with the notice; or (ii) where the notice was served elsewhere - within the time specified by the order giving leave to effect the service; comply with the requirements of the notice or satisfy the Court that he or she has a counter-claim, set-off or cross demand equal to or exceeding the amount of the judgment debt or sum payable under the final order, as the case may be, being a counter-claim, set-off or cross demand that he or she could not have set up in the action or proceeding in which the judgment or order was obtained; ... (3) For the purposes of paragraph (1)(g): (a) … (b) a judgment or order that is enforceable as, or in the same manner as, a final judgment obtained in an action shall be deemed to be a final judgment so obtained and the proceedings in which, or in consequence of which, the judgment or order was obtained shall be deemed to be the action in which it was obtained; and (d) a person who is for the time being entitled to enforce a final judgment or final order for the payment of money shall be deemed to be a creditor who has obtained a final judgment or final order; and (e) … 57 Section 10 of the Magistrates Court Act 2004 (WA) provides that the Court's civil jurisdiction is set out in the Magistrates Court (Civil Proceedings) Act 2004 (WA). Section 46 of the Magistrates Court (Civil Proceedings) Act provides that the Civil Judgments Enforcement Act 2004 (WA) applies to a judgment of the Magistrates Court in its civil jurisdiction. Section 5 of the Civil Judgments Enforcement Act provides that the Act applies to and in respect of any judgment given by, relevantly, the Magistrates Court in the exercise of its civil jurisdiction. Section 11 of the Civil Judgments Enforcement Act provides that a judgment has effect at the time it is given. There are provisions that provide for the suspension of and enforcement of a judgment. These extend (by the definition of 'judgment' in that Act) to monetary judgments. As to the power to order costs, s 25 of the Magistrates Court (Civil Proceedings) Act provides for the power of the Magistrates Court to order costs. 58 Therefore, no issue arises on its face as to the power of the Magistrates Court to order by consent the payment of a sum under a contract such as the Heads of Agreement: nor is there an issue as to the making of a costs order. All orders took effect when made. 59 It follows that in accordance with Abigroup Ltd v Abignano (1992) 39 FCR 74 at 80-81, the Magistrates Court orders were final judgments in favour of a judgment creditor against a judgment debtor, and upon which execution has not been stayed. Accordingly, the Strata Company was entitled to enforce the judgments by way of execution as a final judgment within the meaning of s 40(1)(g) and s 41(1)(b) of the Bankruptcy Act.

Abuse of process 60 Mr and Mrs Spiro also submitted that the conduct of the Strata Company in taking bankruptcy proceedings amounts to an abuse of process. Mr Thiel deposed to the fact that he is an experienced member of the Strata Company and strata management in general, and that the recovery of fees from owners is an essential function of the Strata Company's administration. He deposed to the bankruptcy proceedings being brought in order to recover outstanding fees. Even acknowledging the self-serving nature of such evidence, I have been unable to discern any evidence of an intention by the Strata Company to do anything other than seek to recover levies. The Strata Company agreed to payment by instalments and so accorded Mr and Mrs Spiro time to pay. It engaged in settlement discussions culminating in the Heads of Agreement. Although SAT proceedings were foreshadowed, Mr and Mrs Spiro agree to pay instalments regardless. The Strata Company went down the path of a means inquiry, although it was adjourned and later abandoned. An application to stay the judgment had already been unsuccessful. According to Mr Thiel, Mr Spiro had claimed since 2018 that he would bring SAT proceedings. As already observed, SAT proceedings were later instituted but dismissed and, viewed objectively, were not actively pursued. They were dismissed in circumstances where the SAT member apparently warned Mr and Mrs Spiro about difficulties they might face with the relief they sought at that time (as referred to by the registrar - see [50] above). The Strata Company was not obliged to look to other methods of enforcement in those circumstances. 61 I do not accept in the circumstances of this case that the issue of the bankruptcy notice with the intention, or hope, that the debt would be paid, but that if it was not paid then bankruptcy proceedings would issue, is an abuse of process. 62 Other allegations of bullying by the Strata Company were not substantiated by any evidence, and accepting that Mr and Mrs Spiro keenly believe they have been bullied, I cannot be persuaded by speculation and submission alone that there was any bullying that rose to a level of conduct that might indicate an abuse of process or other cause to dismiss the petition.

The various submissions made by Mr and Mrs Spiro about the underlying debt 63 It is to be recalled that Mr and Mrs Spiro have already unsuccessfully challenged the validity of the bankruptcy notice which relied upon the Magistrates Court judgments. Many of their arguments before me were the same as those run in that application. Regardless, I have considered them closely, having regard to the evidence before me. 64 As to the complaint that there was an absence of a valid resolution for the levying of fees, the statements in the Form 21A and the Response are to the contrary. The Form 21A states that resolutions as to levying contributions were passed in accordance with the Strata Titles Act. I accept that is in effect simply a pleading. However, the Response annexed to Mr Thiel's affidavit states to the effect (in response to the Statement) that all levies have been raised and approved at an annual general meeting. Mr Thiel expressly refers to the Response filed by the Strata Company in his affidavit and states that he is acting as the authorised representative of the Strata Company in those proceedings. 65 Further, Mr Spiro has included excerpt of minutes of the annual general meetings of the Strata Company held in 2018, 2019 and 2020 for the purpose of his 'debt recovery motion' argument (referred to below). The only complete set of minutes that he has included are those for 2020, being for a period that post-dates the levying of the fees the subject of the judgment. The 2020 minutes clearly set out that ordinary resolutions were passed as to the administration and reserve funds and as to the amounts to be levied. It is not clear why Mr Spiro chose to include only excerpts (that did not include any information about levy resolutions) of the minutes for the previous years. Nor is there any other reliable evidence that indicates that no resolutions as to levies were passed. In the circumstances, I have no reason to doubt that the information in the Response in this regard is correct. 66 Taking into account all of those matters, I am not satisfied on the materials before me that Mr and Mrs Spiro have a reasonably arguable case that levies were not authorised. 67 Further, there was no evidence before me from which I could infer that the election of councillors or the election of Mr Thiel were in some way invalid. Mr Spiro's claims in his submissions rise to no more than speculation. 68 As to the allegations about the improper commencement of proceedings, there is no apparent restriction placed on the Strata Company under s 36 of the Strata Titles Act as to how it is to authorise the commencement of proceedings. It can be assumed that the Strata Company was duly constituted in accordance with s 32(1). Therefore, pursuant to s 32(3), it was capable of suing and being sued. I note that the Response attached to Mr Thiel's affidavit states that the Council of Owners unanimously authorised the Strata Company to commence action against Mr and Mrs Spiro to recover outstanding debts, 'as it does in relation to every large [debt] as indicated in the minuted meeting of 24 May 2018'. That minute was not in evidence, and the weight to be given to the statement in the Response is accordingly somewhat reduced. But nor is there any evidence to the contrary or from which I could properly draw an inference to the contrary. I do not consider on the material before me that the question raised by Mr Spiro as to authority to commence proceedings has any real prospect of being answered in his favour. 69 I should add in this regard that Mr Spiro made much in his submissions of a 'debt recovery motion' that he said had been rejected on three occasions. Having reviewed the materials, it seems to me that Mr Spiro has perhaps misunderstood a particular reference in the materials, and has proceeded on the basis that it means something that it does not. The Response indeed states that 'No motion for debt recovery has ever been approved at an AGM by the Strata Company, although such a resolution has been proposed on three occasions'. Mr Spiro submitted, apparently in reliance on this statement, that no motion to recover debts was ever approved. 70 However, understood in context, it is apparent that by the proposed motion the Strata Company sought to introduce a new schedule 1 by-law for 'costs recovery' which would have entitled the Strata Company to require payment from proprietors of a large number of costs and claims on demand, such as: legal costs on a solicitor/client basis for any recovery proceedings as liquidated damages; debt recovery agency costs; costs of remedying defects; insurance excess costs etc. This motion failed on three occasions (annexure SP27 to Mr Spiro's affidavit of 29 September 2022). This appears to be the motion referred to in the Response. 71 The Response is therefore accurate in this regard, in that it addresses a matter raised by Mr and Mrs Spiro and accepts that such a motion failed. That is not an acceptance that there is no power at all on the part of the Strata Company to pursue outstanding debts. The failure of such a motion does not undermine or alter the pre-existing and continuing powers and rights of the Strata Company at law to recover debts due to it. 72 Turning to the complaint about a lack of information about the debts, I do not accept Mr Spiro's submission that he had received no evidence of the quantum of the debt he is said to owe. The levy statements were itemised in the Form 19 filed in the Magistrates Court. The judgments state the amounts on their face. The revised amounts, which took into account the crediting of payments, were set out in the bankruptcy notice. Calculations were provided to his solicitors. The petition also provides for the crediting of payments made by Mr and Mrs Spiro against the first judgment debt of $16,273.23 (Mr Spiro contends that payments of $19,000 were made, and accepting that is the case for present purposes, and that no part was allocated to a separate debt, the difference does not in any event satisfy or significantly reduce the judgment debt). 73 There is no formal requirement prescribed for the manner in which solicitors were to be authorised to act on behalf of the Strata Company. The solicitors were formally on the court record in the Magistrates Court and this Court and there is no evidence that would lead me to doubt that they were formally instructed to act. Further, Mr Marzec, a lawyer and so an officer of the Court, informed me from the bar table that he has been the solicitor with carriage of the proceedings since 2018. 74 Mr Spiro submitted that there were references in the documents to a 'sinking fund' and that the Strata Company was not authorised to hold a sinking fund. This is an argument of form over substance: the documents suggest that the administration fund or reserve fund may have been referred to as a sinking fund (see the Response at item 49) - this does not mean that there was in fact any unauthorised fund. 75 As to the Heads of Agreement, it expressly provided for entry of judgment in favour of the Strata Company, and the Strata Company provided consideration in that it agreed to defer enforcement and permit Mr and Mrs Spiro time to pay. It is true that it is said in the Heads of Agreement that the consent judgment is made 'under protest' by Mr and Mrs Spiro. And yet they consented to it, received the benefit of time to pay, and it is unclear whether the protest carried any meaning other than that they made no admission as to liability for the underlying debt. However, the fact remains that a contractual agreement was made as to payment and a consent judgment that reflected that agreement was entered by the Magistrates Court. It is also true that the Heads of Agreement anticipated that the SAT proceedings could still be pursued. It is to be recalled that the SAT proceedings, at least as originally constituted, sought declaratory relief and to have certain questions answered. Its complaints included but ranged beyond some of the matters that related to the particular debts sought to be recovered from Mr and Mrs Spiro. The fact that Mr and Mrs Spiro sought to preserve the right to pursue a hearing before SAT did not abrogate their commitment to pay the judgment debt in accordance with the Heads of Agreement. To find otherwise would suggest that Mr and Mrs Spiro signed the Heads of Agreement with no intention of honouring it. 76 I have addressed at [58] the power of the Magistrates' Court to order that legal costs be paid. Mr and Mrs Spiro admitted liability for the amount of costs and the judgment was premised on that admission. Mr Spiro's submission that there was no authority to order costs cannot be accepted. 77 I do not accept that the petition should be dismissed so that the new SAT proceedings can be finalised. SAT proceedings were previously instituted and were not pursued in any timely manner. I accept that Mr Spiro dealt with some medical issues during the period that the SAT proceedings were on foot. However, it is now some three years since the Strata Company prima facie became entitled to the benefit of the judgments and there has been no real progress of SAT proceedings since that time. Mr Spiro has been forewarned by a SAT member of potential issues with a SAT application in the form previously filed (and for completeness I add that the transcript of the hearing before SAT Member Petrucci on 6 January 2022 was before the Court as an attachment to an affidavit of Mr Marzec filed 8 March 2022). I have no information about the content or timing of the 'new' SAT proceedings. 78 The generalised allegations made by Mr and Mrs Spiro in their submissions to the effect that the Strata Company's records are in disarray, and to the effect that the alleged conduct and language of Mr Thiel weigh against reliance on the bankruptcy notice, do not assist with the resolution of the matters at hand. I understand that Mr and Mrs Spiro feel aggrieved at the manner in which they perceive they have been treated by the Strata Company. However, the levying of fees is conduct that is to be expected by proprietors in a strata title development, and they have failed to descend into providing any persuasive evidence that there has been some absence of authority or misconduct in the manner in which the relevant levies were set, approved, invoiced or pursued. 79 A further submission, that proceedings brought by the Australia and New Zealand Banking Group Limited (ANZ) against defendants including Mr and Mrs Spiro (CIV 1077 of 2019) should be resolved before any sequestration order is made against them, has no substance. I was provided with the front page of a writ in the proceeding. There is no useful evidence as to the content, relevance or timing of the resolution of those apparently long-standing proceedings.

No basis to go behind judgment debt 80 It follows that I have not been persuaded, having regard to the principles discussed in Ramsay Health, that this is a case where the Court should go behind the judgment debt upon which the bankruptcy notice, and so the act of bankruptcy, are premised. 81 I accept that the judgments did not follow a trial. However, there is no doubt that the issues upon which Mr and Mrs Spiro now seek to rely were aired in the pleadings filed in that proceeding, and that the Heads of Agreement was entered into by way of a compromise, and at a time when all parties were legally represented. The fact that there was a dispute as to the basis upon which contribution levies were claimed does not support an inference that there was collusion or fraud with respect to the Heads of Agreement. There is no evidence of collusion or fraud. Mr and Mrs Spiro have not sought to have the Heads of Agreement set aside, and an application to have the judgment orders stayed was unsuccessful. Nor am I satisfied that there has been any miscarriage of justice that would justify going behind the judgment debt. 82 I have also taken into account that the matters that Mr and Mrs Spiro seek to raise about strata levies were exposed and disclosed by the Magistrates Court proceeding. The Forms 19, 19A, 21 and 21A, all filed prior to the Heads of Agreement, disclose that the dispute included disputes as to the raising of levies, non-payment of levies, the statutory duties of the Strata Company, whether resolutions were passed or required with respect to levies, and as to the crediting of payments. 83 So it can be seen that those matters were set up in the proceeding but Mr and Mrs Spiro agreed to a settlement and signed a Heads of Agreement. They may now have a sense of remorse about that course, but nevertheless it is not a course that has revealed fraud, collusion or any miscarriage of justice. Nor on the evidence before me does it appear that Mr and Mrs Spiro have any realistic defence to the claim for payment of the levied fees. 84 The Court in its bankruptcy jurisdiction does not examine every judgment debt. Special circumstances must be established before it will do so. As already observed, the judgments were by consent; there is no evidence of fraud or collusion; the parties were legally represented; the issues had been disclosed and identified prior to entry into the Heads of Agreement; and there is no defence disclosed on the evidence that would have had any real prospect of success. I do not consider Mr and Mrs Spiro have established special circumstances for going behind the debt by going behind the underlying judgments. Even assuming it is open to the Court to go behind the judgments, I do not consider the outcome in this matter would be any different.

No cross claim that is likely to succeed, is reasonably arguable or of any sufficient validity 85 Nor do I consider on the materials before me (and having regard to the reasons given above) that Mr and Mrs Spiro have any reasonably arguable cross claim against the Strata Company that is relevant to otherwise potentially reduce the debt payable by them. The absence of evidence of any proper claim in debt or damages, the absence of any clear calculation or evidence from Mr Spiro that records all amounts he says have been wrongly levied and all amounts that he asserts he has paid, the settlement reflected in the Heads of Agreement and the lack of any progress in the SAT, tell against any such finding.

Comments on particular documents referred to by Mr Spiro 86 For completeness, I comment on a number of the other documents annexed to his affidavits that Mr Spiro sought to rely upon. Annexure SP24 is a coversheet in the SAT proceedings apparently drafted on behalf of the Strata Company, which refers to a set of 'first AGM' minutes. The cover sheet states that the reason for absence of the minutes is that the person who has the document was interstate at the time due to COVID-19 restrictions. Based on his submission, Mr Spiro appears to know what the document allegedly says but has not tendered it. The complaint appears to be that the Strata Company deliberately failed to provide the document. Having disclosed its existence to SAT and the reason it could not be provided at that time, I do not infer that the Strata Company was concealing the document. It may well have produced it in due course had those SAT proceedings continued, but they were withdrawn. Annexure SP24 does not assist in this application. 87 Mr Spiro claims that Annexure SP23 assists him because it is the minutes (less attachments including reports and accounts) of a Strata Company AGM held on 9 December 2020, and the minutes do not refer to any grant of authority for proceedings to be issued against Mr and Mrs Spiro. The difficulty with the submission is that the minutes post-date the commencement of the Magistrates Court proceedings (27 July 2018) and it is not apparent why or how the minutes from December 2020 should record any such authority. 88 Annexure SP17 insofar as it is an email from SAT to Mr Thiel is relied on by Mr Spiro as establishing that the Strata Company delayed the SAT proceedings. The email indicates that there were issues with reading the bundle of documents provided by the Strata Company and SAT and Mr Thiel engaged in correspondence about pdf readers and pagination options. The email does not evidence any deliberate delay on the part of the Strata Company.

No other sufficient cause 89 I have explained above why I have rejected Mr and Mrs Spiro's submissions relating to the registrar's powers, the nature of the judgment orders and alleged abuse of process. Nor am I satisfied that there is any other sufficient cause why a sequestration order should not be made.

Not satisfied that able to pay debts 90 The submissions by Mr and Mrs Spiro as to their alleged ability to pay were not supported by probative evidence. I have already referred to the ANZ writ. There was no evidence that resolution of those proceedings would assist Mr and Mrs Spiro. Similarly, Mr Spiro made a general submission that the SAT proceedings would see him able to pay his debts. That appears to me to be speculative for all the reasons already given. Although Mr Spiro submitted that the debt the subject of the petition was their only debt, the fact remains that it has not been paid, a matter he attributed in submissions in part to economic circumstances. There was no evidence of a source from which it could be paid. There was evidence in some early affidavits about a company called Tri Star Group Pty Ltd, apparently related to Mr and Mrs Spiro, and from which it was perhaps suggested funds could be sourced. An extract from what were purportedly unaudited accounts of that company did not provide a basis for establishing that it had net assets immediately available to Mr and Mrs Spiro or that in some other way it would assist them to meet the judgment debt. Any evidence as to solvency was too vague and unsubstantiated to satisfy me that Mr and Mrs Spiro are able to pay their debts within the meaning of s 52(2)(a) of the Bankruptcy Act.

Formal matters and orders 91 Mr and Mrs Spiro did not contest that the formal requirements of s 52(1) of the Bankruptcy Act have been proved by affidavits filed by the Strata Company. I find that they have been proved. I am satisfied that Mr and Mrs Spiro failed to comply with the bankruptcy notice and committed an act of bankruptcy.

A comment on the stay application and the hearing 92 Finally, I wish to comment on a procedural matter that arose with respect to this application. 93 When Mr and Mrs Spiro filed their review application they also purported to file a stay application (apparently seeking a stay of proceedings under the sequestration order pending the hearing of the review). The stay application was not filed in an appropriate form and was rejected for filing. 94 Correspondence apparently ensued between Registry and Mr Spiro. 95 In the meantime, and with no stay application before me, I conducted a case management hearing and programmed the review in the hope it could be heard as soon as was practicable. 96 Order 2 of the programming orders required each party to inform my Associate by way of email correspondence of the affidavits on which they sought to rely for the purposes of the review application. Orders 3 and 4 programmed the filing of submissions by the parties. On 24 February 2023 Mr and Mrs Spiro complied with order 2. On 28 February 2023 Mr and Mrs Spiro filed an outline of submissions headed 'Outline of Submissions of Applicant for review of sequestration order made by a registrar'. Those submissions addressed the power of review, the importance of a review hearing, all the matters that they sought to rely on with respect to the review, and in a final section (G) included submissions about a stay. 97 On 28 March 2023 the Strata Company filed its reply submissions. 98 On 27 April 2023 my Associate wrote to the parties as follows: I refer to the application for review filed by the respondents on 19 December 2022. I inform that the application has been listed for hearing on Tuesday 27 June 2023 at 10.15 am AWST. If this date is not convenient, please advise chambers and the hearing will be re-listed accordingly. 99 Mr Spiro replied on 7 May 2023 and 18 May 2023, saying that he was available to attend the proposed hearing on that date. 100 In the interim Mr and Mrs Spiro had filed a stay application in a form that was accepted by Registry, and an additional affidavit (which I also took into account with respect to the review). There was no correspondence received from the parties that raised the question of whether and when the stay application should be heard having regard to the listing of the review hearing and the submissions that had already been filed. In the end, I decided to list the stay application at the same time as the review, so that if it became apparent that it might take some time to deliver a judgment on the review application, and if Mr and Mrs Spiro pointed to urgent pending actions that might require consideration of a stay, then I could also deal with the stay application as appropriate. 101 At the hearing I was informed for the first time that the new SAT proceedings were on foot and that there was a hearing listed on 30 June 2023. I considered that I should properly deal with the review hearing and publish reasons immediately before the SAT hearing. Such a course would provide Mr and Mrs Spiro with certainty. I was also conscious of the question of power that might arise with respect to a stay pending a review as against a stay pending an appeal: Ritson v Commissioner of Police (NSW) [2021] FCAFC 208 at [66]. I received no submissions from the parties on the relevant authorities. 102 At the scheduled hearing on 27 June 2023 Mr Spiro said that he thought he was before me only to deal with the stay application. I did not accept that submission was legitimate in the circumstances. The communications had made it clear that the review application was always listed on that date, and Mr Spiro's written submissions had expressly addressed the review application. I offered Mr Spiro an adjournment to consider his position but he declined and chose to proceed. He made detailed oral submissions with respect to the review application. In the end, because of the decision I have reached, it has not been necessary to determine the stay application. Finally, I note that I also offered Mrs Spiro the opportunity to make submissions and she briefly did so. Mrs Spiro otherwise relied on the submissions made by Mr Spiro.

Orders 103 There will accordingly be orders affirming the decision of the registrar. In making such orders, I have not overlooked the significance of this outcome for Mr and Mrs Spiro. I certify that the preceding one hundred and three (103) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Banks-Smith.

omitted) The Strata Titles Act 1985(WA)

Bankruptcy Act 1966(Cth)ss 40, 41, 52

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