Re MacDonald, R.M. v. Ex parte Faulkner, M.F. & Ors [1987] FCA 475

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IN THE FEDERAL COURT OF AUSTRALIA EXERCISING FEDERAL JURISDICTION

IN BANKRUPTCY

NOT FOR DISTRIBUTION

-4754 3)

No. 186 of 1987 (Part X)

THE C

BANKRUPTCY DISTRICT OF THE STATE OF VICTORIA

Re: RONALD MACRAE | MACDONALD A Debtor Ex parte: MICHAEL FRANCIS FAULKNER Applicant and

RONALD MACRAE MACDONALD, IAN HUGH SHANNON and ALEX NEVILLE BIRD Respondents

NORTHROP J. 15 JULY 1987

uBOURNE

MINUTES OF ORDER

OURT ORDERS THAT: -

l.

The composition of the debtor approved by special resclution of the creditors of the debtor passed on 2

June 1387 be set aside.

A sequestration order be made against the estate of the debtor.

The applicant's costs of and incidental to the

application be taxed and paid according to the Act as if the applicant was the petitioning creditor.

(This order is to be settled and filed in accordance with rule 124 of the Bankruptcy Rules.)

IN THE FEDERAL COURT OF AUSTRALIA

EXERCISING FEDERAL JURISDICTION No. 186 of 1987 (Fart xX)

IN BANKRUPTCY

BANKRUPTCY DISTRICT OF THE STATE OF VICTORIA

Re: RONALD MACRAE MACDONALD A Debtor Ex parte: MICHAEL FRANCIS FAULKNER Applicant and

RONALD MACRAE MACDONALD,

IAN HUGH SHANNON and ALEX NEVILLE BIRD Respondents

COURT NORTHROP J. DATE 15 JULY 1987 PLACE MELBOURNE

EX TEMPORE REASONS FOR JUDGMENT

There 1s before the Court an application brought by

Machael Francis Faulkner for an order pursuant to sub-section 239(2) of the Bankruptcy Act 1966 that the composition of the debtor, approved by special resolution of the creditors of the debtor, passed on 2 June 1987, be set aside. There 15 also an alternative claim based upon sub-section 222(2) of the Bankruptcy Act. I propose to look first at the question

of the claim or application under sub-section 239(2).

The facts of this case are rather unusual. Initially an authority to a solicitor to call a meeting under s.188 of the Bankruptcy Act was signed by the debtor on 7 April 1987. A meeting pursuant to that authority was held at which a composition was proposed in which a sum of $10,000 was to be paid to the trustee by way of composition, in payment of the trustee's fees and charges and an full satisfaction of the proving creditors. At that time, a statement of affairs provided by the debtor showed unsecured debts amounting to something over $900,000. For reasons which I need not explain, that composition did not proceed.