IT No. 405/ 8%... JLDGMER IN THE FEDERAL COURT OF AUSTRALIA) ) NEW SOUTH WALES DISTRICT REGISTRY) No. G417 of 1987 ) GENERAL DIVISION ) BETWEEN: ROBERT JOHN COLLIER and MARION LOUISE COLLIER Applicants AND: AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED Respondent CORAM: M. L. FOSTER, J. DATE: 11 JULY, 1988. PLACE: SYDNEY. REASONS FOR JUDGMENT (EXTEMPORE ) HIS HONOUR: The Court has before it a Notice of Motion dated 8 July, 1988 brought by Robert John Collier and Marion Louise Collier against the Australia and New Zealand Banking Group Limited. The Notice of Motion is entitled G417 of 1987 and is brought in proceedings which had previously been commenced between these parties by Application in this Court bearing the same numeration dated 10 September, 1987. It sufficiently appears that the relief sought in that Application 18 co-extensive with relief sought in the Statement of Claim brought in the Supreme Court of New South Wales on 15 May, 1987. Both the Application in this Court, and the Statement of Claim in the Supreme Court, seek to attack a mortgage document dated 31 January 1985 entered into between the applicants, as mortgagors, and the bank as mortgagee. The mortgage is given in respect of premises, 44 Lerida Avenue, Camden, such premises being the home of the applicants. In both proceedings, attack 1s made on the basis of breaches of part 5 of the Trade Practices Act, 1974 (Cth) and, it would appear, on relevant equitable principles relating to unconscionability and the like in connection with the entering into of mortgages. A claim was made in the Supreme Court proceedings for the review and the necessary alteration of the mortgage pursuant to the Contracts Review Act, 1980 (N.S.W.) and a similar claim 1s made in the Application before this Court on the basis of what 1s described as the Court's accrued jurisdiction. Although, as a matter of pleading, the Application in this Court 1s not as full a document as the Statement of Claim in the Supreme Court, it 1s sufficiently plain to me that both proceedings were intended to encompass the same alleged causes of action and seek basically the same relief. It has been made - 3. sufficiently plain to me that proceedings were taken in the Supreme Court of New South Wales by the bank against Mr. and Mrs. Collier for possession of the premises in Camden, on the hasis of default under the mortgage. Such proceedings were obviously the ordinary type of proceedings necessary to enable the bank to realize upon its security. It appears that 1n the Supreme Court application was made for summary dismissal of Mr. and Mrs. Collier's Statement of Claim. That action was heard in the first instance before Master Sharpe. He acceded to the application. Appeal was taken to a single Judge of the Court without success; and later an appeal to the Court of Appeal of that State was also dismissed. It appears, then, that the bank sought recently to execute upon the mortgage by bringing before the Court the possession proceedings, to which I have already made reference. Those proceedings were heard on 23 June of this year. It 1s clear that on 22 June the Colliers filed a debtor's petition in the Bankruptcy Jurisdiction of this Court. The petition was accepted on that day. There is a dispute, on the material placed before me, as to whether that fact was brought to Master Sharpe's attention when the possession proceedings came before him on the following day. It does not seem, in the upshot, to be of any great significance as to whether they were or not. Section 58(5) of 4, the Bankruptcy Act, 1966 ("the Act") in my view, clearly indicates that the bank, as secured creditor, was in a position to "realise or otherwise deal" with its security, irrespective of the presentation of the petition. The result, in any event, was that the order for possession was made and that currently the situation is that a Writ of Possession pursuant to that order has issued and 1s in the hands of the Sheriff for execution tomorrow, the 12th July, 1988. Subsequent to the presentation of the debtor's petition, the existence of the current proceedings in their substantive form, namely, G417 of 1987, was brought to the attention of the Official Receiver. A request was made pursuant to s. 60 of the Act as to whether he intended to pursue these proceedings. On 1 July, the indication was given by the Official Receiver that 1t was not intended pursuant to s. 60(2) of the Act to carry on with these proceedings. The result is that insofar as the present situation 1s concerned those proceedings have no status before me and the Notice of Motion based upon them equally has no status. Accordingly, so far as relief 1s sought in respect of those proceedings, it 1s my view that I currently have no jurisdiction to grant any such relief. There is, of course, before this Court, the proceedings relating to the bankruptcy of Mr. and Mrs. Collier on their own Petition. To the extent that jurisdiction in Bankruptcy 15 conferred upon this Court, 1t would appear that consideration can at least be given to some extent to their current position. I have been advised of two things. Firstly, that the Official Receiver 1s willing and has taken some steps to call a meeting of creditors at the end of this month on the question of whether other proceedings in relation to the mortgage might be commenced as it were, in substitution for, but different from, the proceedings which he has elected not to continue. There 1s nothing before me to indicate what form those proceedings would take and I was advised last Friday that the only steps that have been taken in that regard could be characterised as a contemplated approach to counsel to see if any further cause of action could be divined in the facts.I have also been advised that informal approaches to the creditors, other than the secured creditor, on the part of the Official Receiver have produced only a response indicative of the fact that they would probably not be interested in any further proceedings being taken. 6. The other matter that has been brought to my attention 1s one that Mrs. Collier has put forward, namely that she wishes to take proceedings to have the bankruptcy annulled.This, apparently, would be on the basis that debts, other than the secured creditor's debt, could be paid in full. I have nothing before me to indicate, in effect, the nature of those proceedings, nor any material upon which I can forecast whether or not they would be successful. Assuming for the moment that they would be successful, the question then arises as to what Mr. and Mrs. Collier would do if freed from bankruptcy so far as any application to this Court 1s concerned. The only current application to the Court 1s one which has been, in effect, barred at least temporarily by the Colliers' bankruptcy. It 1s in the same terms as the application which has been summarily dismissed in the Supreme Court. Questions of 1ssue estoppel would obviously arise. A reading of the Statement of Claim does not suggest to me that it, as presently drafted, and on the facts as set out in it, would be likely to produce a satisfactory result as far as the Colliers were concerned. The question of whether I adjourned these proceedings, or gave some temporary relief based upon the existence of the bankruptcy proceedings, 1s one that I have considered. It 1s clearly a discretionary matter; its jurisdictional base 1s 7. tenuous to say the least. In all the circumstances, as a matter of discretion, I feel that I have no option but to dismiss this Notice of Motion, and I do so, and the ordinary order for costs must be made; they must follow the event. I certify that this and the six preceding pages are a true copy of the reasons for judgment herein of his Honour Mr. Justice M.L. Foster. Dated: 1 August, 1988. 4 - (dnc Associate: