Teese v Woodgate

REASONS FOR JUDGMENT 1 This is an application by a bankrupt seeking an order in the following terms: "[t]hat all sales and other realisations of property in the bankrupt estate…including sale by auction on 16 October 2003 or otherwise of 3/39 Melrose Place Clovelly, be stayed and/or restrained until further Order." 2 A sequestration order was made against the bankrupt as long ago as 20 August 2002. The matter has a long and complex history that is not possible to recount having regard to the time constraints. In any event, much of the history is set out in the judgment of Lindgren J in Teese v Clinch Neville Long [2003] FCA 274. 3 The administration of the bankruptcy has been marked by repeated unsuccessful applications by the bankrupt. These, naturally enough, have attracted costs orders which have led to a very substantial amount of costs being incurred by the trustee in the administration of the estate. 4 The present proceedings were filed yesterday, 15 October 2003. As Duty Judge I was told that the parties would be ready to proceed at 4.00 pm yesterday. Because there were difficulties in holding a hearing at that time, I listed the matter for 9.45 am this morning. Shortly after that time the matter was called for hearing. Mr Knaggs appeared for the bankrupt. 5 Mr Knaggs indicated that he was not ready to proceed at that time and requested an adjournment. After some debate, the matter was adjourned until 12 noon. Mr Knaggs was not present at that time but arrived shortly thereafter. He read an affidavit sworn by the bankrupt in support of the application for a stay. 6 It has not been easy to ascertain the basis upon which a stay of the auction has been sought. It is necessary to remember that the auction is scheduled for 6.00 pm today. There is, therefore, urgency about dealing with the application and, of course, in delivering a judgment. It may be that the circumstances of urgency have made it difficult for the bankrupt to formulate a case with precision. So far as I was able to follow it, the main point made on her behalf was that the trustee, in some way, had been in default of his obligations under s 73 of the Bankruptcy Act 1966 (Cth). That provision is to the effect that where a bankrupt desires to make a proposal to his or her creditors for a composition or scheme of arrangement, a proposal in writing may be lodged. The trustee is then to call a meeting of creditors and there are certain other obligations that must be fulfilled. 7 The suggestion has been made that the trustee did not act sufficiently promptly. The evidence indicates that a proposal was made on or about 9 May 2003. It was ultimately rejected by a meeting of creditors held on 29 August 2003. There is nothing in the evidence that establishes that there is a serious issue to be tried as to whether the trustee was in default of his statutory duties in administering the estate in respect of the proposal. Even if there were some evidence of that, it is far from apparent as to how that would justify an order staying the auction that is scheduled for later today. 8 The affidavit of the bankrupt addresses a number of other matters. None, however, in my view establishes that there is a serious issue to be tried on any matter that would justify the grant of an injunction at this stage to restrain the auction scheduled for this afternoon. I should add that some of the matters that appear to have been adverted to in the affidavit and by Mr Knaggs on behalf of the bankrupt have been agitated on other occasions before Judges of this Court or before the Federal Magistrates Court. 9 The end result is that I am not satisfied that the bankrupt has made out that there is any serious issue to be tried on a ground that would enable an injunction to be issued restraining the conduct of the auction. 10 Accordingly, I dismiss the application for interlocutory relief. 11 I order the bankrupt to pay the costs of the application and further order that the costs may be recovered by the trustee after the estate of the bankruptcy. I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Sackville.