Bryant, J.R. v Commonwealth Bank [1995] FCA 219

IN THE FEDERAL COURT OF AUSTRALIA) ) NEW SOUTH WALES DISTRICT REGISTRY) No. NP 1922 of 1994 ) GENERAL DIVISION ) BETWEEN: JOSEPH RICHARD BRYANT Applicant AND: COMMONWEALTH BANK Respondent

30 MARCH 1995 REASONS FOR JUDGMENT LOCKHART J. This is the hearing of a petition by the Commonwealth Bank of Australia to sequestrate the estate of Joseph Richard Bryant. The petitioning creditor has proved the formalities requisite for the making of a sequestration order. The issues on the hearing of the petition are the issues raised by Mr Bryant, the debtor, and are set out in his notice of appearance filed in the Sydney Registry on 13 December 1994. Mr Bryant has appeared for himself in this proceeding as indeed he has in other proceedings. It is obviously desirable that litigants have the benefit of counsel or solicitors to assist them and I have done my best, consistent with the duties of a judge to remain impartial, to be of some assistance to him in relation to his presentation of argument and of evidence. Mr Bryant has, I think, shown an awareness of the issues and a perception of the relevant facts and has conducted his case as well as could be expected of a layman. The first argument that is relied upon by Mr Bryant is that the service of the petitioning creditor's petition was not properly effected. Two grounds of objection are raised. The first is that the petition was served by a licensed commercial agent by dropping the petition near Mr Bryant, but not actually delivering it into his hands. The second is that it was served in that fashion in the precincts of the court in this building. The facts relating to service of the petition are set out in the affidavit of Malcolm Hill of 25 August 1994, and in his oral evidence which he gave today. Mr Hill served Mr Bryant with an official copy of the creditor's petition together with the customary documents in support of it in this building in the following circumstances. Mr Bryant was present in court room 7A of the Supreme Court of New South Wales in this building. He left the court room and proceeded to the lift area on level 7 of this building. He entered the lift in the company of a male person. Mr Hill followed them into the lift and the three men then ascended to level 10. As they did so Mr Hill said to Mr Bryant: "Mr Bryant is it?" To which Mr. Bryant replied: "Yes." Mr Hill said: "That is Joseph Richard Bryant, isn't it?" Mr Bryant said: "Yes." Mr Hill then said: "I have a creditor's petition and other documents here for you in the matter of yourself and the Commonwealth Bank, will you please accompany me outside to effect service." The lift had by then reached level 10 and Mr Bryant left the lift saying to Mr Hill: "No, I've got other business up here." Mr Hill then said: "Well, I will serve you here then." And he dropped the documents on the floor outside the lift in Mr Bryant's presence. There is some difficulty in determining the precise point at which the documents were dropped, but it would appear to be a matter of a metre or two away from the lift, though in my view this does not matter. Mr Hill has said that, immediately after he served Mr Bryant in this fashion, he observed him turn around towards him and that Mr Bryant observed the documents then upon the floor. Mr Hill has said he cannot say if Mr Bryant retrieved the documents as he immediately returned to the lift. Mr Bryant appeared on the return date of the petition and has appeared thereafter at subsequent directions hearings and, as I say, appears for himself today. Obviously he is aware of the petition. The bankruptcy rules require that a petition be served personally by a debtor: see rule 15. The requirements of the rules as to service of bankruptcy petitions must be complied with as has been observed in a number of cases including Re Florence ex parte Turrameta Properties Proprietary Limited (1979) 36 FLR 256 per Lockhart J at 263. There are cases which have discussed what constitutes service upon, or delivery of documents to, a debtor personally. It is clear that documents do not have to be put into the hands of the debtor where he refuses to accept them: see Henry Ditford ex parte Deputy Commissioner of Taxation (1988) 19 FCR 347; and the cases collected by Hill J in his judgment concerning Mr. Bryant relating to a challenge to a validity of a bankruptcy notice which founds the present petition, his Honour's judgment being delivered on 4 May 1994. See in particular pages 23 to 27 where his Honour dealt with service of a bankruptcy notice upon Mr. Bryant. The general principles are not different from those governing service of petitions. In all the circumstances as related by Mr Hill, and I accept his evidence, I am satisfied that the service of the documents in the fashion that I have indicated was personal service upon Mr Bryant. The next objection is whether the service of the documents in the precincts of courts on level 7 of this building in some way vitiates the service. Speaking generally it is not desirable that process is served upon persons in the precincts of a court or in this court building but there are occasions when that course is permissible. Indeed, it is possible for the service of process within the precincts of a court to constitute contempt and the cases are replete with references to this but, it all depends upon the circumstances of the case surrounding the service of the process. The cases are conveniently collected in a comprehensive judgment of Yeldham J of the Supreme Court of New South Wales in Baldry v Jackson (1976) 1 NSWLR 19 which was affirmed on appeal by the Court of Appeal of New South Wales at (1976) 2 NSWLR 415, though the point as to service with which I am dealing was not a point raised on the appeal. See also Re Tole (1933) 50 Weekly Notes NSW 216. In my opinion the service of the documents as outlined in Mr Hill's evidence, including his evidence as to experiencing prior difficulties with service of documents upon Mr Bryant, was not service that was otherwise than in compliance with the rules by virtue of being served in the precincts of courts on level 7 of this building. It was in my view proper service. I therefore find no substance in that ground of objection by Mr Bryant. A third ground of objection taken by Mr. Bryant in his notice of intention to appear, though not mentioned in argument is that the creditor's petition was said to fail to include the proper address for service of the solicitor for the petitioning creditor. That is based upon some evidence which at one stage Mr Bryant sought to rely, that the solicitors for the petitioning creditor may have changed their address at or about the time of the presentation of the petition. There is no evidence which would support a finding that the address stated in the petition of the solicitors for the petitioning creditor, namely first floor, 140 Phillip Street, Sydney, New South Wales, was not the proper address for service of process upon the petitioning creditor. Even if that evidence had been led and had established that point, it would have been in my opinion an immaterial defect. The next argument of Mr Bryant is that he says evidence establishes that he is solvent. Solvency is the ability of a person to pay his or her debts as and when they fall due and again, the cases are replete with what this means and I need not cite them. It is, of course, a distinct concept in the law of insolvency, from their being a surplus of assets over liabilities. Sometimes, the two are equated, though often not. When I dealt with an earlier application by Mr Bryant to adjourn the petition, I set out in some detail the evidence that is before the Court today dealing with Mr Bryant's financial position, which included evidence of the financial position of corporations and trusts with which he is associated. The evidence before the court on the hearing of the petition is not evidence that could conceivably satisfy a court that Mr Bryant is solvent. The next argument that is raised by Mr Bryant is that he says the petition has been presented and prosecuted maliciously. He relies upon the fact (there is no evidence of it, but he made the assertion in Court) that at some stage in the late 1980s when interest rates were high in the community, he made some criticism of banks in this country in some newspaper or magazine. He says that in some way this influenced the presentation of this petition and the bank's prosecution of him to recover its debt.