Zielinska v CKM Nominees Pty Ltd [1999 FCA 1244

FEDERAL COURT OF AUSTRALIA

Zielinska v CKM Nominees Pty Ltd [1999] FCA 1244

No question of principle

DANUSHA ZIELINSKA v CKM NOMINEES PTY LIMITED N 7864 OF 1999 HELY J 24 AUGUST 1999 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 7864 OF 1999

BETWEEN: DANUSHA ZIELINSKA

Applicant

AND: CKM NOMINEES PTY LIMITED

Respondent

JUDGE: HELY J

DATE OF ORDER: 24 AUGUST 1999

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The application of 2 August 1999 is dismissed. 2. The applicant to pay the costs of the motion including any reserved costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 7864 OF 1999

BETWEEN: DANUSHA ZIELINSKA

Applicant

AND: CKM NOMINEES PTY LIMITED

Respondent

JUDGE: HELY J

DATE: 24 AUGUST 1999

PLACE: SYDNEY

EXTEMPORE REASONS FOR JUDGMENT 1 On 20 April 1999 the respondent to the present motion obtained a judgment in the Local Court at Sutherland against the plaintiff in the sum of $3,028.77. That judgment was obtained after a contested hearing on the merits. On 12 July 1999 a bankruptcy notice was served upon the plaintiff based upon that judgment. It is common ground that the time for compliance with that bankruptcy notice expired at the end of 2 August 1999. 2 On 2 August 1999 the applicant took out an application purportedly under ss 30 and 41(7) of the Bankruptcy Act 1966 seeking to have the bankruptcy notice set aside. Only one affidavit was filed in support of that application. It is an affidavit of the applicant of 30 July 1999. That affidavit asserted as follows: 3. I have a good and valid cross claim against the judgment creditor which has now been filed in the Local Court in the sum of $15,000 from 1 April 1998. 3 Apart from attaching what purports to be a statement of liquidated claim issued on 30 July 1999 out of the Local Court at the Downing Centre, that is the only information provided by the applicant with respect to the alleged cross claim. It is clear that the affidavit does not comply with the requirements of O 77 r 13(3) in a number of respects, the most important of which for present purposes, is that it does not contain any information as to why the counter-claim, set-off or cross demand was not raised or could not have been raised in the proceedings in the Local Court which resulted in the judgment. 4 My attention has been drawn to a decision of the Full Court in Webb v Hunter (1995) 59 FCR 24 which decides that the deemed extension of time otherwise effected by s 41(7) has no application where the affidavit filed in support of the application does not establish that the counter-claim, set-off or cross demand relied upon is one which satisfies the requirements of s 41(7). Two things I think flow from this fact: the first is that insofar as the application is grounded on s 41(7) it must fail. The second is that insofar as the application is grounded on s 41(6A) it must also fail because the proceedings to set aside the Local Court judgment were instituted by a Notice of Motion filed yesterday, 23 August 1999, that is to say after the expiration of the time fixed for compliance for the requirements of the bankruptcy notice. That is sufficient to dispose of the application insofar as it is based on s 41(6A). But I would add that, in any event, I would have refused the application upon the basis of s 41(6C); the proceedings to set aside the judgment or order have not been prosecuted with due diligence as the judgment was entered on 20 April 1999 and the first occasion on which application to set it aside was made was yesterday. 5 I am also satisfied that those proceedings have not been instituted bona fide because the only basis for the motion and the only basis for a claim to set aside the Local Court judgment is the alleged existence of the cross claim. I do not see how that can avail the applicant when the proceedings in the Local Court were decided after a contested hearing on the merits. The result is that the application is dismissed. 6 The application of 2 August 1999 is dismissed and the applicant is to pay the costs of that motion including any reserved costs. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Hely.