CATCHWORDS PRACTICE AND PROCEDURE - Bankruptcy jurisdiction - Consent Order - Need for enactment of provision similar to Order 35 Rule 10 of Federal Court Rules. Bankruptcy Act 1966 EX PARTE; CITICORP AUSTRALIA LIMITED: CITICORP AUSTRALIA LIMITED & ANOR. v. RAYMOND JOHN HUDSON & ORS. QLD. PET.NO.761 of 1984 SPENDER J. BRISBANE 13 MAY 1986 sre sino os crass npr ne ae th Ts STOTT eo . Me IN THE FEDERAL COURT OF AUSTRALIA ) GENERAL DIVISTON ) QLD PET No.761 of 1984 BANKRUPTCY DISTRICT OF THE SOUTHERN ) le ee ere DISTRICT OF THE STATE OF QUEENSLAND ) EX PARTE: CITICORP AUSTRALIA LIMITED CITICORP AUSTRALIA LIMITED ALLAN RICHARD TAYLOR RAYMOND JOHN HUDSON SABSTERN PTY. LIMITED ERICA MAY HUDSON and CARINA OLIVE WICKHAM First Applicant Second Applicant First Respondent Second Respondent Third Respondents TIM MAGUIRE and MICHAEL MAGUTRE JENNIFER ANNE SOLLY Fourth Respondents Fifth Respondent DATE JUDGMENT DELIVERED: 13 MAY, 1986 APPEARANCES: First and Second Applicants: Mr. M.J. Miller of Cranston, McEachern & Co. Trustee of First Respondent: Mr. R.E. Templeton of Watkins Stokes. Second Respondent: Mr. C. Sullivan of M.G. Lyons & Co., Third Respondent: Mr. L.F. Boyd of Cannan & Peterson Fourth Respondent: Mr. D.P. Spence of Thynne & Macartney Fifth Respondent: Mr. J.R. Ffrench of Skinner & Smith 13 May 1986 Peter Applegarth Associate to Spender J. = 4, — wy = Varsow - ye eek Wes ee sees ae IN THE FEDERAL COURT OF AUSTRALIA ) GENERAL DIVISION ) QLD PET No.761 of 1984 BANKRUPTCY DISTRICT OF THE SOUTHERN ) DISTRICT OF THE STATE OF QUEENSLAND } EX PARTE: CITICORP AUSTRALIA LIMITED CITICORP AUSTRALIA LIMITED First Applicant ALLAN RICHARD TAYLOR Second Applicant RAYMOND JOHN HUDSON First Respondent SABSTERN PTY. LIMITED Second Respondent ERICA MAY HUDSON and CARINA OLIVE WICKHAM Third Respondents TIM MAGUIRE and MICHAEL MAGUIRE Fourth Respondents JENNIFER ANNE SOLLY Fifth Respondent MINUTE OF ORDER JUDGE MAKING ORDER: SPENDER J. DATE OF ORDER: 13 MAY, 1986 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. the balance of the money paid into the court by the fourth respondent namely one hundred and thirty-five thousand four hundred and thirty-one dollars and forty-one cents ($135,431,41) invested by the Registrar of the Court with the National Australia Bank Limited pursuant to the order of the Honourable Mr. Justice Pincus made the second day of August, 1985, together with accretions, be paid to the solicitors for the fifth respondent, Messrs. Skinner and Smith; 2. the undertaking given to the court on the thirtieth day of May, 1985 by the second respondent, Sabstern Pty.Ltd., be discharged; ee a en ee a ee oe od ra oy em ye eg ge ore ern 7 af Te pet et ee epee ere r soos 3. the application by the first applicant, Citicorp Australia Limited u and the second applicant, Allan Richard Taylor, be struck out; . 4. the undertaking given to the court on the twenty-first day of May, 1985 by the first applicant, Citicorp Australia Limited, be discharged; i 5. there be no order as to costs with the exception of any orders for a costs already obtained by the fourth respondents. ts. Note: Settlement and entry of orders is dealt with by Bankruptcy Rule 124. Seater ' Rap pe eo - ew en ae a _ ero 4 a in i IN THE FEDERAL COURT OF AUSTRALIA ) GENERAL DIVISION ) QLD PET No.761 of 1984 BANKRUPTCY DISTRICT OF THE SOUTHERN ) DISTRICT OF THE STATE OF QUEENSLAND ) EX PARTE: CITICORP AUSTRALIA LIMITED CITICORP AUSTRALIA LIMITED First Applicant ALLAN RICHARD TAYLOR Second Applicant RAYMOND JOHN HUDSON First Respondent SABSTERN PTY. LIMITED Second Respondent ERICA MAY HUDSON and CARINA OLIVE WICKHAM Third Respondents TIM MAGUIRE and MICHAEL MAGUIRE Fourth Respondents JENNIFER ANNE SOLLY Fifth Respondent SPENDER J. 13 MAY 1986 This matter raises a point of practice and procedure in the bankruptcy jurisdiction which has some cost implications for parties who practice in that jurisdiction. After wide-ranging and episodic litigation involving a number of parties with differing interests, the solicitors for all the parties submitted a draft order signed by each of them. This draft order was directed to me in chambers and reference was made to the provisions of 0.35 r.10 of the Federal Court Rules. 0.35 r.10 provides: "(1) A written consent of the parties to a proceeding, or the solicitors, to the making of an order in the proceeding may be filed in the Registry at the proper place. (2) Notwithstanding anything contained in these Rules, upon the written consent being so filed, the Registrar shall bring the matter before a Judge who, if he thinks fit, may, without any other application being made to him, direct the Registrar to draw up, sign and seal an order in accordance with the terms of the consent. (3) The order shall state that it is made by consent and shall be of the same force and validity as if it had been made after a hearing by the Judge." The rules of the Federal Court do not apply to matters in the bankruptcy jurisdiction. Order 2 rule 11 provides: Federal C "(1) Except as to Order 41 (which relates to form of documents), these Rules do not apply to proceedings under the Bankruptcy Act 1966. (2) Subject to Order 41, the practice and procedure of the Court in relation to proceedings under the Bankruptcy Act 1966 shall be in accordance with the Bankruptcy Rules and the Bankruptcy (Offences) Rules as in force for the time being." There is no provision similar to 0.35 r.10 of ourt Rules to be found in the bankruptcy rules. extensive appropria the Section 30(1)(b) of the Bankruptcy Act 1966 gives powers to the court to make orders as it thinks te. That subsection provides: yp een an yA TG fia awe en sg ae se rotcper oe ae "(1) The Court - (b) may make such orders (including declaratory orders and orders granting injunctions or other equitable remedies) as the Court considers necessary for the purposes of carrying out or giving effect to this Act in any such case or matter." Those powers are conferred on the court, and there is no power, it seems to me, in a bankruptcy matter to follow a procedure similar to that permitted by 0.35 r.10 of the Federal Court Rules. The purpose of litigation is the resolution of disputes. Where parties in contention have reached an informed agreement to resolve the matter, then a court generally should be astute to lend its support by efficient procedures to effect that agreement. Of course, the fact of consent by the parties cannot usurp the power of the court to decline to give effect to an agreement in a case where the proposed consent order is inappropriate. Here the want of a procedure similar to 0.35 r.10 has meant that both applicants and each of the five respondents has had to appear. The consent order is entirely appropriate in the circumstances. It involves the paying out of sums in excess of $135,000, together with the release of undertakings given by various of the respondents, and with other ancillary orders, which, on any view of the matter, would have been an agreement appropriate to have been dealt with by a procedure similar to 0.35 r.10, had there been such a procedure. an oo As a consequence, costs have been incurred needlessly. It seems desirable in the circumstances for considereation to be given to amending the Bankruptcy rules to afford an opportunity for a procedure similar to that afforded in Federal Court litigation by 0.35 r.10. I order by consent that:- 1. the balance of the money paid into the court by the fourth respondent namely one hundred and thirty-five thousand four hundred and thirty-one dollars and forty-one cents ($135,431,41) invested by the Registrar of the Court with the National Australia Bank Limited pursuant to the order of the Honourable Mr. Justice Pincus made the second day of August, 1985, together with accretions, be paid to the solicitors for the fifth respondent, Messrs. Skinner and Smith; 2. the undertaking given to the court on the thirtieth day of May, 1985 by the second respondent, Sabstern Pty.Ltd., be discharged; 3. the application by the first applicant, Citicorp Australia Limited and the second applicant, Allan Richard Taylor, be struck out; i <T wets ieow ee I ap ere ae wae ', an et as mee tye ah aoe: tae he - wa —— — the undertaking given to the court on the twenty-first day of May, 1985 by the first applicant, Citicorp Australia Limited, be discharged; there be no order as to costs with the exception of any orders for costs already obtained by the fourth respondents. preceding at ikis and the ¥ at ibis a s for £, at carry in . : ie copy of tie reascn 2 rt? oges ure ay . . p ° waont Herern cf His Wonour yeagme™. Mr. Justics Sponeer AP eR — Dated wy than Ae.