Evans v Duff [2004] FCA 1643

FEDERAL COURT OF AUSTRALIA

Evans v Duff [2004] FCA 1643 BANKRUPTCY – appeal from a sequestration order – costs order made in the Supreme Court of Queensland – two bankruptcy notices issued – whether the act of bankruptcy described by the petitioning creditor is correct – whether the Court should allow an amendment to the creditor's petition Federal Court of Australia Act 1976 (Cth) s 25(1A) Bankruptcy Act 1966 (Cth) ss 43(1), 52 JOHN DAVIS EVANS v ROBERT JOHN DUFF No Q 188 of 2003 SPENDER J BRISBANE 15 DECEMBER 2004

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY Q 188 OF 2003

BETWEEN: JOHN DAVIS EVANS

APPELLANT

AND: ROBERT JOHN DUFF

RESPONDENT

JUDGE: SPENDER J

DATE OF ORDER: 15 DECEMBER 2004

WHERE MADE: BRISBANE

THE COURT ORDERS THAT: 1. The orders made on 18 November 2003, by Federal Magistrate Baumann, including the order that the estate of John David Evans be sequestrated, are set aside. 2. The respondent pay the appellant's costs of and incidental to the appeal, to be taxed if not agreed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY Q 188 OF 2003

BETWEEN: JOHN DAVIS EVANS

APPELLANT

AND: ROBERT JOHN DUFF

RESPONDENT

JUDGE: SPENDER J

DATE: 15 DECEMBER 2004

PLACE: BRISBANE

REASONS FOR JUDGMENT 1 This is an appeal from a sequestration order made by Federal Magistrate Baumann on 18 November 2003. The notice of appeal was filed on 5 December 2003. 2 Pursuant to s 25(1A) of the Federal Court of Australia Act 1976 (Cth), the Chief Justice on 30 January 2004 determined that this matter be heard by a single Judge. On 16 February 2004 I stayed the sequestration order until the determination of the appellant's appeal. 3 The debt which founds the making of the sequestration order is concerned with a costs order made by Mackenzie J in the Supreme Court of Queensland. The action leading to the costs order concerned the validity of the respondent to these proceedings, Mr Duff, being appointed as Receiver and Manager to the Southport RSL Memorial Club Incorporated and Trustees of the Returned and Services League of Australia (Queensland Branch) - Southport Sub-Branch. 4 On 19 September 2001, Mr Evans' application to intervene in an application by the Receiver concerning the validity of his appointment was dismissed. On 25 September 2001, Mackenzie J declared that the respondent was validly appointed as Receiver and Manager. His Honour directed that a copy of the reasons be served on Mr Evans. Those reasons included directions as to the filing of submissions as to costs. After those submissions were received, on 31 October 2001 Mr Evans was ordered to pay the respondent's costs of the application concerning the validity of Mr Duff's appointment as Receiver and Manager to the South RSL Memorial Club Incorporated. 5 On 28 May 2002 Mr Evans filed an application for leave to appeal the order for costs that had been made by Mackenzie J. Mackenzie J on 20 November 2002 ordered the application for leave to appeal be dismissed with costs. 6 On 24 December 2002 a deputy registrar of the Supreme Court issued an order for assessment of costs in the sum of $30,975.93. The order made on that day by Acting Senior Registrar Mitchell was: 'Pursuant to the order of MacKenzie J made on 25 September 2001 [sic 31 October 2001] that Mr John Evans pay the applicant's costs of and incidental to the application for the declaration as to the receivers and managers appointment including reserved costs to be assessed, the costs statement of the applicants has been assessed and allowed on the sum of $30,975.93.' 7 The reference to 25 September 2001 is erroneous; the order that Mr Evans pay costs was made on 31 October 2001. The order of Mackenzie J on 31 October 2001 was: 'John David Evans pay the applicants costs of the application, including reserved costs and costs of the application for costs, to be assessed.' 8 It appears from an affidavit of the solicitor for the respondent filed 21 August 2003 that, on or about 14 January 2003, a bankruptcy notice was issued by Mr Duff. On 26 February 2003, in proceedings BZ 99 of 2003, Mr Evans filed in the Federal Magistrates Court in Brisbane an application for an order to set aside the bankruptcy notice. The details of that application were a claim by Mr Evans 'To set aside the Bankruptcy Notice upon adjudication of the Applicant's Counter-Claim' and 'To uphold the Applicant's Counter-Claim equating the whole of the Respondent's claim of debt and interest.' 9 A bankruptcy notice dated 14 January 2003 is in evidence before the Court. This bankruptcy notice bears a notation that it was served on 6 February 2003 at 4.55 pm. The bankruptcy notice bears the number 40/03. That bankruptcy notice claims that Mr Evans owes Mr Duff the sum of $30,975.93 'as shown in the Schedule'. The bankruptcy notice says: 'A copy of the judgment or order relied on by the Creditor is attached.' The Schedule is in the following terms: ' Column 1 Column 2 1. Amount of judgment or order $30,975.93 plus 2. Legal costs if ordered to be paid and a specific amount was not included in the judgment or order (see Note 1, below) $Nil plus 3. If claimed in this Bankruptcy Notice, interest accrued since the date of judgment or order (see Note 2, below) $Nil 4. Subtotal $30,975.93 less 5. Payment made and/or credits allowed since date of judgment or order $Nil 6. Total debt owing $30,975.93