Palmer v Penson

The Hearing

1. At the hearing (commenced before me as Duty Judge on 26 June 2018) the plaintiff was represented by Ms Christine Perry, solicitor. As a bankrupt, the defendant had no legal interest in the proceedings and accordingly had no standing (National Australia Bank Limited v Strik [2009] NSWSC 184; Bendigo Bank Ltd v Demaria [2001] VSC 218 at [18]). I note no defence was filed. Any right to appear in the proceedings vests in the Trustee and only then to the extent that an equitable interest is asserted.
2. By letter dated 29 July 2016 the defendant's Trustee advised that he did not oppose the plaintiff's application to obtain vacant possession of the property for the purposes of sale, preserving (as he is entitled to do) any rights to residual funds after sale of the property. The Trustee has not filed a notice of appearance nor has the Trustee sought to be heard in contradiction of the relief claimed by the plaintiff in the statement of claim.
3. Mr Philip Beazley, solicitor, sought to appear as contradictor to the plaintiff's claim, instructed by the defendant. A notice of appearance has been filed on the defendant's behalf naming Mr Beazley as her solicitor. In circumstances where the relief sought in the statement of claim would otherwise have been unopposed, I granted leave for Mr Beazley to appear as contradictor.
4. The plaintiff relied on the affidavit of Christopher John Palmer sworn 13 February 2018, annexed to which was a copy of the sealed orders made by Kunc J on 20 April 2016; a letter from the plaintiff to the defendant dated 5 May 2016; a letter from the defendant to the plaintiff dated 7 July 2016; a memorandum created by an unidentified person from the plaintiff's insolvency company (O'Brien Palmer) detailing actions taken, unsuccessfully, to effect service of the notice to vacate the premises; notification of bankruptcy; a letter from the Trustee to the plaintiff dated 29 July 2016 (to which I earlier referred); a letter from the plaintiff to the defendant erroneously dated 18 January 2016 (the letter having been created and sent on 18 January 2017); a letter from the Office of the Registrar General to the plaintiff's solicitor in respect of an application for access to information made pursuant to the Government Information (Public Access) Act 2009 (NSW); title search for the property and a Request from the Land and Property Information office confirming the plaintiff is the registered owner of the property. The affidavit material reflects the plaintiff's numerous attempts to secure vacant possession of the property, all of which have been unsuccessful.
5. Mr Beazley did not tender any evidentiary material. It was his submission that the plaintiff's claim was incompetent as the property did not vest in the plaintiff pursuant to the orders made by Kunc J on 20 April 2016, but in the Trustee upon his appointment on 4 June 2016, such that the plaintiff is unable to enforce a legal remedy against the defendant in respect of what he impliedly conceded was a provable debt without leave of the Court under s 58(3) of the Bankruptcy Act 1966 (Cth). A Court having jurisdiction in bankruptcy pursuant to s 5 of the Bankruptcy Act does not include this Court. In Mr Beazley's submission, in order for this Court to make the orders sought the plaintiff is obliged to seek leave in a competent court (being the Federal Court) to further proceed against the plaintiff.
6. In Mr Beazley's submission, the effect of order 7 made by Kunc J on 20 April 2016 staying the execution of order 2, also made and entered on that day, prevented the property vesting in the plaintiff such that it vested in the Trustee on 4 May 2016 upon his appointment. Were that the case, s 58 of the Bankruptcy Act would prevent the plaintiff proceeding against the defendant, otherwise than with leave.
7. This submission fails for two reasons. Firstly, the stay imposed on 20 April 2016 expired before the order was made appointing the Trustee on 4 May 2016. Since the order staying proceedings was not referable to a given day or event, 20 April 2016 is to be counted as one of the 14 days. That being the case, the stay expired at the stroke of midnight on 4 May 2016 (Uniform Civil Procedure Rules, r 1.11). The appointment of the Trustee did not take effect for some hours thereafter that day. Accordingly, were it the case that the stay prevented the order appointing the plaintiff as receiver and manager from taking effect until it expired (which, for reasons discussed below, it did not), the stay expired prior to the appointment of the Trustee.
8. Secondly, and more pertinently, the order made by Kunc J by order 7 staying orders 2 - 6 made on 20 April 2016 did not prevent the order appointing the plaintiff as receiver and manager from taking effect. The order was entered on 20 April 2016 and, pursuant to r 36.4 of the Uniform Civil Procedure Rules, it took effect on that date (no order having been made under r 36.4(3) which would have altered the date on which the order took effect). The stay merely operated to prevent enforcement of the order. Thus, even were it the case that the Trustee was appointed during the period in which the stay was in force, the property would not have vested in the Trustee in any event since it had already vested in the plaintiff upon the order being entered.
9. That being the case, I am satisfied that the plaintiff is the registered proprietor of the property and is entitled to possession. It is not in issue that, as receiver and manager under s 420 of the Corporations Act 2001 (Cth), the plaintiff is entitled to dispose of the property. The plaintiff pleads, and the material annexed to the affidavit of the plaintiff establishes, that he has requested the defendant to vacate the property which the defendant has persistently refused to do.
10. The material is suggestive of the defendant having mental health issues, although this is not clinically established. I accept, however, that being required to vacate the premises in which the defendant has lived for a number of years (albeit, in recent years, without any legal right to occupy the premises) may have the potential to exacerbate her health concerns. I propose to allow the defendant a period of four weeks to vacate the premises, after which a writ of possession will issue.
11. Accordingly, I make the following orders: 1. Judgment for the plaintiff for possession of the land comprised in folio XXX being the land situated at and known as XXX Gillespie Avenue, Alexandria in the state of New South Wales. 2. Leave to the plaintiff to issue a writ of possession; such writ not to be executed before 25 July 2018. 3. The defendant is to pay the plaintiff's costs.

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