Green v Official Trustee in Bankruptcy, in the matter of Schneller [2003] FCA 164

FEDERAL COURT OF AUSTRALIA

Green v Official Trustee in Bankruptcy, in the matter of Schneller [2003] FCA 164

Bankruptcy Act 1966 (Cth), s 109(10)

Green v Official Trustee in Bankruptcy, in the matter of Schneller [2001] FCA 1644 discussed Nguyen v Minister for Health & Ageing [2002] FCA 1462 applied Re James Ex parte Condon (1874) L.R. 9 Ch. App. 609 considered Official Trustee in Bankruptcy, in the matter of Matson v Deputy Commissioner of Taxation [1999] FCA 914 discussed Re the Estate of Connell (Deceased) [2001] FCA 51 discussed Waterloo Holdings Pty Ltd v Tismo (NSW Court of Appeal, Sheller & Powell JA & Sheppard AJA, 28 August 1997, unreported) referred to Re Kyra Nominees Pty Ltd (in liq) (1987) 11 ACLR 767 referred to Re Allied Glass Manufacturers Ltd (1936) 9 ABC 21 discussed Re Elias Ayoub; Ex parte Silvia (1983) 67 FLR 144 discussed IN THE MATTER OF JENNIFER SCHNELLER RICHARD GREEN v OFFICIAL TRUSTEE IN BANKRUPTCY N 7469 of 2001 MOORE J SYDNEY 7 MARCH 2003

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 7469 OF 2001

IN THE MATTER OF JENNIFER SCHNELLER

BETWEEN: RICHARD GREEN

APPLICANT

AND: OFFICIAL TRUSTEE IN BANKRUPTCY

RESPONDENT

JUDGE: MOORE J

DATE OF ORDER: 7 MARCH 2003

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The application be dismissed with 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 7469 OF 2001

IN THE MATTER OF JENNIFER SCHNELLER

BETWEEN: RICHARD GREEN

APPLICANT

AND: OFFICIAL TRUSTEE IN BANKRUPTCY

RESPONDENT

JUDGE: MOORE J

DATE: 7 MARCH 2003

PLACE: SYDNEY

REASONS FOR JUDGMENT

Introduction 1 This is an application by Richard Green ("the applicant") seeking payment, and in some respects preference and priority over other creditors, in relation to amounts said to be payable by the Official Trustee in Bankruptcy ("the Trustee") from the estate of Jennifer Schneller ("the bankrupt"). There has been a long history of litigation between the applicant and the bankrupt. The following is a summary drawn from a chronology prepared by the applicant's solicitors. 2 In 1994, the applicant sued the bankrupt for defamation in the Supreme Court of NSW. In March 1998, while the defamation action was pending, the bankrupt and her husband signed consent orders under the Family Law Act 1975 (Cth), transferring the bankrupt's half interest in their matrimonial home at Northwood to the husband in May 1998. Judgment was given in the defamation proceedings in favour of the applicant in June 2000. In June 2001, the applicant filed a summons in the Equity Division of the Supreme Court of New South Wales, seeking a declaration that the transfer of the Northwood property was void, pursuant to s 37A of the Conveyancing Act 1919 (NSW) ("the Supreme Court proceedings"). 3 On 7 August 2001, the bankrupt's estate was sequestrated when she filed a debtors petition. She then said she had assets of approximately $1,040 and liabilities of approximately $470,000. In November 2001, the applicant sought leave in this Court to continue the Supreme Court proceedings. The Trustee did not oppose leave being granted though indicated it should be subject to conditions. Hill J granted leave pursuant to s 58(3) of the Bankruptcy Act 1966 (Cth) ("the Act"), and ordered the applicant to pay the Trustee's costs of the application: see Green v Official Trustee in Bankruptcy, in the matter of Schneller [2001] FCA 1644. The orders of Hill J were: 1. Leave be granted to Mr Green to continue proceedings 3331 of 2001 in the Equity Division of the Supreme Court of New South Wales against Jennifer Ann Schneller and Paul Ronald Schneller and to take all necessary steps in those proceedings together with all necessary fresh steps. 2. Leave is granted without prejudice to any issues of substance which may arise in the Supreme Court proceedings. 3. The applicant pay the Official Trustee's costs and there be no order for costs in respect of Mr Dennis. THE COURT NOTES THE FOLLOWING UNDERTAKINGS BY THE APPLICANT: 1. To recover the property at 42 Upper Cliff Road Northwood and not seek final relief without 7 days notice to the Official Trustee. 2. Not to oppose the Official Trustee being joined in the Supreme Court proceedings at any time. 3. To hold the benefit of any order made for the Official Trustee on behalf of the bankrupt estate of Mrs Schneller. 4. To seek amendment of the amended summons filed in the Supreme Court proceedings so as to delete the claim for an order that the first defendant's share of the proceedings (sic) be forthwith applied in satisfaction or partial satisfaction of the plaintiff's judgments against the first defendant and for the costs of the Supreme Court proceedings. 5. To notify the Official Trustee on at least 48 hours notice of any application which Mr Green may seek to make to amend substantively the orders presently sought in the amended summons filed in the Supreme Court proceedings.