Healey v Prentice (No 2) [2000] FCA 1598

FEDERAL COURT OF AUSTRALIA

Healey v Prentice (No. 2) [2000] FCA 1598

BANKRUPTCY – review of the decision of the trustees of a bankrupt estate not to pursue litigation in which the bankrupt was involved – nature of review.

Bankruptcy Act 1966 (Cth), ss 60, 178

Bethune v Newman (1996) 19 ACSR 99, followed Re Wheeler; ex parte Wheeler v Halse (1994) 54 FCR 166, followed Cummings v Claremont Petroleum NL & Anor (1996) 185 CLR 124, cited GREGORY HARRISON HEALEY v MAXWELL WILLIAM PRENTICE & ORS N 7835 of 1999 MADGWICK J 2 NOVEMBER 2000 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N7835 of 1999

BETWEEN: GREGORY HARRISON HEALEY

APPLICANT

AND: MAXWELL WILLIAM PRENTICE AND MARK JULIAN ROBINSON

FIRST RESPONDENTS

COMMONWEALTH BANK OF AUSTRALIA

SECOND RESPONDENT

JUDGE: MADGWICK J

DATE OF ORDER: 2 NOVEMBER 2000

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The application be dismissed. 2. The applicant pay the respondent's costs of the motion and those costs be regarded as costs of the administration for the purposes of s 109 of the Bankruptcy Act 1966 (Cth).

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N7835 of 1999

BETWEEN: GREGORY HARRISON HEALEY

APPLICANT

AND: MAXWELL WILLIAM PRENTICE AND MARK JULIAN ROBINSON

FIRST RESPONDENTS

COMMONWEALTH BANK OF AUSTRALIA

SECOND RESPONDENT

JUDGE: MADGWICK J

DATE: 2 NOVEMBER 2000

PLACE: SYDNEY

REASONS FOR JUDGMENT (revised from transcript) HIS HONOUR: 1 The applicant in this application is a bankrupt solicitor and the first respondents are the Trustees of his estate. The second respondent was the petitioning creditor, and by far the applicant's largest creditor, and at its behest, the applicant was made bankrupt. The interests of the second respondent were inextricably involved with the outcome of this application and as the hearing proceeded, the fictional quality of the Bank not being party to the application became apparent. By consent the Bank was joined as a party. 2 By his application, the applicant claims as follows: "1. An Order, pursuant to s178 of the Act that the decision of the Trustee dated 16 July 1999 to not pursue litigation in which the bankrupt was involved prior to the date of bankruptcy be set aside. 2. An Order that the bankrupt be permitted to continue with the litigation in respect of the Commonwealth Bank of Australia namely: