FEDERAL COURT OF AUSTRALIA Long v McVeigh [2002] FCA 711 BANKRUPTCY – application for leave to appeal from interlocutory judgment of Federal Magistrates Court – where respondent relies on ss 120 and 121 of the Bankruptcy Act 1966 (Cth) to recover certain properties transferred to applicant – where case raises a question of principle Bankruptcy Act 1966 (Cth) ss 120, 121 Decor Corporation Pty Ltd v Dart Industries Inc (1991) 104 ALR 621 considered IN THE MATTER OF NOEL FREDERICK LONG DAWN DENISE LONG v DEAN FOYSTON McVEIGH V278/02 HEEREY J 22 MAY 2002 MELBOURNE IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY V278 OF 2002 IN THE MATTER OF NOEL FREDERICK LONG BETWEEN: DAWN DENISE LONG APPLICANT AND: DEAN ROYSTON McVEIGH RESPONDENT JUDGE: HEEREY J DATE OF ORDER: 22 MAY 2002 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. The applicant have leave to appeal from the whole of the judgment of his Honour Federal Magistrate McInnis given on 3 May 2002 in proceeding MZ 634 of 2001 in the Federal Magistrates Court of Australia sitting at Melbourne. 2. The costs of this proceeding are reserved for determination at the hearing of the appeal. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY V278 OF 2002 IN THE MATTER OF NOEL FREDERICK LONG BETWEEN: DAWN DENISE LONG APPLICANT AND: DEAN ROYSTON McVEIGH RESPONDENT JUDGE: HEEREY J DATE: 22 MAY 2002 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 This is an application for leave to appeal against a decision of the Federal Magistrates Court which it is accepted is an interlocutory judgment. Thus leave is necessary: s 24(1A) Federal Court of Australia Act 1976 (Cth). The claim is one in which the present respondent seeks to recover certain properties transferred to the applicant. The respondent relies on ss 120 and 121 of the Bankruptcy Act 1966 (Cth) (the Act). The applicant contended before the Federal Magistrates Court that the respondent, who was the trustee of the bankrupt transferor's estate, had no standing because the bankrupt was discharged from bankruptcy on 1 June 1999 and the proceeding was not commenced until 15 August 2001. Counsel for the applicant contends that the fruits of a claim under ss 120 and 121 would not be "property of the bankrupt" within ss 5, 58 or 116 of the Act. On the other hand, Counsel for the respondent contends that the twenty year period prescribed by s 127(1) of the Act is applicable. 2 In my opinion this is an appropriate case for the grant of leave. It was contended on the authority of Decor Corporation Pty Ltd v Dart Industries Inc (1991) 104 ALR 621 that leave should not be granted unless the decision was "attended with sufficient doubt". I am not sure it is correct to apply the decision as though it prescribed a statutory test. In any event I note that in Decor the court eschewed the application of any "rigid or exhaustive criteria". I think the reasons advanced by counsel for the applicant certainly raise at the very least an arguable case. Perhaps more importantly, the case raises a question of principle. Counsel for the respondent accepted that there is no authority directly on point and there is therefore a public interest going beyond the parties themselves in having this point authoritatively determined. 3 It would also be productive of injustice if the applicant were wrongly deprived of a statutory right to stop at the outset a claim brought by the respondent. So leave to appeal will be granted. Costs will be reserved. I certify that the preceding three (3) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey. Associate: Dated: 5 June 2002 Counsel for the Applicant: R S Randall Solicitor for the Applicant: Best Hooper Counsel for the Respondent: N Hannan Solicitor for the Respondent: Abbott Stillman & Wilson Date of Hearing: 22 May 2002 Date of Judgment: 22 May 2002