Matheson v Insolvency & Trustee Service Australia, in the matter of Matheson [2005] FCA 894

FEDERAL COURT OF AUSTRALIA

Matheson v Insolvency & Trustee Service Australia, in the matter of Matheson [2005] FCA 894 FREDERICK JAMES MATHESON v INSOLVENCY AND TRUSTEE SERVICE AUSTRALIA QUD 59 OF 2005 DOWSETT J 6 MAY 2005 BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY QUD 59 OF 2005

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN: FREDERICK JAMES MATHESON

APPLICANT

AND: INSOLVENCY AND TRUSTEE SERVICE AUSTRALIA

RESPONDENT

JUDGE: DOWSETT J

DATE OF ORDER: 6 MAY 2005

WHERE MADE: BRISBANE

THE COURT ORDERS THAT: 1. The appeal be dismissed. 2. The applicant pay the respondent's costs 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

QUEENSLAND DISTRICT REGISTRY QUD 59 OF 2005

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN: FREDERICK JAMES MATHESON

APPLICANT

AND: INSOLVENCY AND TRUSTEE SERVICE AUSTRALIA

RESPONDENT

JUDGE: DOWSETT J

DATE: 6 MAY 2005

PLACE: BRISBANE

REASONS FOR JUDGMENT 1 This is an appeal from a decision of a Federal Magistrate declining to annul a bankruptcy pursuant to s 153B of the Bankruptcy Act 1966 (Cth) (the "Bankruptcy Act"). The exercise of such a power is discretionary. Given that this man was bankrupted on his own petition in May 2002, and this application was not made until late last year, delay alone, in the absence of convincing explanation, seems to be a good ground for refusing to exercise the discretion in his favour. However, the Magistrate dealt in detail with the various complaints made by the bankrupt. A number of grounds were raised before him, not all of which are the subject matter of the appeal. The notice of appeal contains a number of so-called grounds, but the real thrust of them is the assertion that a misrepresentation was made to the bankrupt prior to the presentation of his petition, and that had he been aware of the true situation, he would not have presented it. The relevant misrepresentation is said to be contained in a pamphlet distributed by the Official Receiver in connection with debtors' petitions. Under the heading, "Your Trustee" the pamphlet states: 'You will have a trustee, either a private registered trustee, or ITSA. If you are making yourself bankrupt you may choose your trustee. If a creditor makes you bankrupt, they choose your trustee. Creditors may change your trustee.' 2 In the present case, upon presentation of the petition, the bankrupt became bankrupt by force of the Act. In default of any other identified trustee, Insolvency and Trustee Service Australia ("ITSA") or the Official Trustee, became trustee. It seems that the course which was then adopted was to cause a registered trustee to convene a meeting of creditors. At the meeting, the creditors decided to appoint a different trustee. The bankrupt, in effect, submits that this is contrary to his wishes, that he wished ITSA or the Official Trustee to act, and had he known that would not necessarily be the case, he would not have proceeded. 3 It is clear to me that there was no misrepresentation. The paragraph clearly identifies the possibility that the trustee may be changed by the creditors, and the Bankruptcy Act so provides. In those circumstances, this ground of appeal must fail. 4 In any event, there is no sensible basis for asserting that any conduct short of fraud would lead to a person who has been bankrupted on his own petition being permitted to resile from it at a later date. The bankrupt sought to rely upon the Trade Practices Act 1974 (Cth) ("Trade Practices Act"), but the Trade Practices Act was not intended to allow as a consequence of the jurisdiction conferred by that Act, the setting aside of a bankruptcy in circumstances other than those contemplated in the Bankruptcy Act. 5 The bankrupt, in effect, has alleged fraud, but there is no evidence which would suggest fraud on the part of anybody and, in any event, as I have said, the representation in question was true, as far as I can see. In those circumstances, all the grounds of appeal fail, and the appeal must be dismissed. The bankrupt has, in the course of argument, sought to ventilate a number of other grounds, some of which appear to have been raised before the Magistrate. However, for the reasons given by the Magistrate, none of them has any merit, and I do not propose to deal with them in these reasons. I limit the decision to the grounds of appeal raised in the notice of appeal. The appeal must be dismissed. I order that the applicant/bankrupt pay the respondent's costs of the appeal. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.