FEDERAL COURT OF AUSTRALIA Osborne v Gangemi (No 2) [2011] FCA 1278 Citation: Osborne v Gangemi (No 2) [2011] FCA 1278 Parties: RICHARD OSBORNE and KOUROSH JAFARI v ANTONIO GANGEMI, STEPHEN ROBERT DIXON (AS TRUSTEE OF THE PROPERTY OF ANTONIO GANGEMI, THE DEBTOR) and JOHN ADAMS (AS TRUSTEE OF THE PROPERTY OF ANTONIO GANGEMI, THE DEBTOR File number: VID 742 of 2009 Judge: BROMBERG J Date of judgment: 4 November 2011 Legislation: Bankruptcy Act 1966 (Cth) ss 30, 156A(3)(a) Federal Court of Australia Act 1976 (Cth) s 21 Cases cited: Osborne v Gangemi [2011] FCA 1252 Cavanagh v The Bank of New Zealand (1990) 22 FCR 124 Date of hearing: 4 November 2011 Place: Melbourne Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 5 Counsel for the Second Applicant: Mr M Gronow Solicitor for the Second Applicant: Christopher Bunnett Solicitor Counsel for the Third Applicant: Mr M Strang Solicitor for the Third Applicant: Melbourne Legal Partners Counsel for the First Respondent: Mr S Minahan Solicitor for the First Respondent: Abrahams Meese Lawyers Counsel for the Second and Third Respondents: Mr P Agardy Solicitor for the Second and Third Respondents: Lewis Holdway Lawyers IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 742 of 2009 BETWEEN: RICHARD OSBORNE Second Applicant KOUROSH JAFARI Third Applicant AND: ANTONIO GANGEMI First Respondent STEPHEN ROBERT DIXON (AS TRUSTEE OF THE PROPERTY OF ANTONIO GANGEMI, THE DEBTOR) Second Respondent JOHN ADAMS (AS TRUSTEE OF THE PROPERTY OF ANTONIO GANGEMI, THE DEBTOR Third Respondent JUDGE: BROMBERG J DATE OF ORDER: 4 NOVEMBER 2011 WHERE MADE: MELBOURNE THE COURT DECLARES THAT: 1. Anthony Robert Cant was on 4 November 2011 appointed as the trustee of the estate of Antonio Gangemi. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 742 of 2009 BETWEEN: RICHARD OSBORNE Second Applicant KOUROSH JAFARI Third Applicant AND: ANTONIO GANGEMI First Respondent STEPHEN ROBERT DIXON (AS TRUSTEE OF THE PROPERTY OF ANTONIO GANGEMI, THE DEBTOR) Second Respondent JOHN ADAMS (AS TRUSTEE OF THE PROPERTY OF ANTONIO GANGEMI, THE DEBTOR Third Respondent JUDGE: BROMBERG J DATE: 4 NOVEMBER 2011 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 These reasons for judgment should be read with my earlier reasons for judgment in these two proceedings published earlier today as Osborne v Gangemi [2011] FCA 1252. This morning I made orders in proceeding VID 742 of 2009 including an order sequestrating the estate of the first respondent in that proceeding, Antonio Gangemi. At the time that order was pronounced it became operative so that Gangemi became a bankrupt with all of the consequences that entails: Cavanagh v The Bank of New Zealand (1990) 22 FCR 124. 2 Section 156A(3)(a) of the Bankruptcy Act 1966 (Cth) ("the Bankruptcy Act") provides that, if a registered trustee has consented to act as a trustee and not revoked such consent, the Bankruptcy Act operates to appoint the registered trustee as the trustee of the estate of the bankrupt. As indicated in my earlier reasons for judgment at paragraph [66], a Consent to Act Declaration was filed with the Court by Paul Anthony Pattison, a registered trustee. 3 At the time I pronounced my orders this morning, the Court had not been made aware of two matters: (1) That Anthony Robert Cant, a registered trustee, had also signed a Consent to Act Declaration consenting to act as trustee to the estate of Gangemi, such consent having been given on 3 March 2011; and (2) That in matter VID 644 of 2011 Pattison had given an undertaking to North J on 8 July 2011 that he would: …cease carrying out, consenting to or otherwise accepting appointment as a registered trustee under the Bankruptcy Act 1966 (Cth) ("the Act") until such times as he has produced evidence in a form acceptable to the Inspector- General in Bankruptcy, a committee formed pursuant to Division 1 of Part VIII of the Act or to the Court demonstrating his practical and financial capacity adequately and properly to carry out his duties as a registered trustee. 4 The undertaking given by Pattison appears to me to have had the effect of impliedly revoking his consent to act as the trustee of Gangemi's estate effective as of 8 July 2011. Accordingly, the pronouncement of the order made sequestrating Gangemi's estate and the fact that Cant had consented to act as a trustee for Gangemi's estate had, by force of s 156A(3) of the Bankruptcy Act, the effect of appointing Cant as the trustee of Gangemi's estate from the time the order was pronounced and not of appointing Pattison. 5 An application has this afternoon been made by the second applicant Osborne for the Court to exercise its declaratory power pursuant to s 30 of the Bankruptcy Act or in the alternative s 21 of the Federal Court of Australia Act 1976 (Cth) to declare that Cant has been appointed the trustee of Gangemi's estate. It seems to me that in the circumstances there is utility in making the declaration sought. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bromberg. Associate: Dated: 10 November 2011