Deputy Commissioner of Taxation v Zappia (No 2) [2020] FCA 669

FEDERAL COURT OF AUSTRALIA

Deputy Commissioner of Taxation v Zappia (No 2) [2020] FCA 669 File number: NSD 2117 of 2018

Judge: JAGOT J

Date of judgment: 18 May 2020

Catchwords: PRACTICE AND PROCEDURE – application for stay of orders – where stay sought is limited to allow the filing of a notice of appeal – where certain undertakings given to the Court in support of stay application – application granted

Legislation: Bankruptcy Act 1966 (Cth) s 73

Cases cited: Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 Deputy Commissioner of Taxation v Zappia [2019] FCA 2152

Date of hearing: Determined on the papers

Date of last submissions: Applicant: 13 May 2020 First Respondent: 23 April 2020

Registry: New South Wales

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: General and Personal Insolvency

Category: Catchwords

Number of paragraphs: 8

Solicitor for the Applicant: Craddock Murray Neumann Lawyers

Solicitor for the First Respondent: Hall Partners Pty Ltd

ORDERS NSD 2117 of 2018

BETWEEN: DEPUTY COMMISSIONER OF TAXATION Applicant

AND: JOHN ZAPPIA First Respondent

SARANDOS SPYRAKIS IN HIS CAPACITY AS TRUSTEE OF THE COMPOSITION OF JOHN ZAPPIA PURSUANT TO SECTION 73 OF THE BANKRUPTCY ACT 1966 Second Respondent

JUDGE: JAGOT J DATE OF ORDER: 18 MAY 2020

THE COURT ORDERS THAT:

1. Pursuant to the Bankruptcy Act 1966 (Cth) (the Act) and, in particular section 222(1) as applied by section 76B of the Act to a composition under Division 6 of Part IV of the Act, the composition made between the first respondent and his creditors under Division 6 of Part IV of the Act on 19 September 2018 be set aside. 2. Consequent upon Order 1, the applicant (Mr Zappia) and the creditors of Mr Zappia as at 16 September 2016 are restored to the positions they were in before the acceptance by his creditors by special resolution on 19 September 2018 of Mr Zappia's composition proposal under section 73 of the Act, such that Mr Zappia, on the one hand, was and is taken to have been a bankrupt on and from 16 September 2016 to the date of his discharge from bankruptcy pursuant to section 149 of the Act, pursuant to the acceptance by the Official Receiver of debtor's petition presented by Mr Zappia's under section 55 of the Act, and the creditors of Mr Zappia as at 16 September 2016, on the other hand, are and have been on and from 16 September 2016 creditors of the bankrupt estate of Mr Zappia. 3. The first respondent pay the applicant's costs as agreed or taxed. 4. Order 1 above be stayed for a period of 28 days to enable the first respondent to file an appeal and, if an appeal is filed, to make a further application for a stay. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.