Abu-Amsha v Wagner

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judge: BANKS-SMITH J
• Judgment Date: 12 June 2019
• Neutral Citation: [2019] FCA 900
• Date: 12 June 2019

FEDERAL COURT OF AUSTRALIA

Abu‑Amsha v Wagner [2019] FCA 900

File number:	WAD 7 of 2019
Judge:	BANKS-SMITH J
Date of judgment:	12 June 2019
Catchwords:	BANKRUPTCY AND INSOLVENCY - application for review of registrar's decision to dismiss creditor's petition and application for substituted service of petition - where copy of judgment not attached to bankruptcy notices - where insufficient evidence of service - where absence of reliable evidence as to address - where no act of bankruptcy established - where petition relies on act of bankruptcy that cannot be established - whether futile to order substituted service of petition
Legislation:	Acts Interpretation Act 1901 (Cth) s 29 Bankruptcy Act 1966 (Cth) ss 40, 47, 306, 309 Evidence Act 1995 (Cth) s 160 Federal Court of Australia Act 1976 (Cth) s 35A Bankruptcy Regulations 1996 (Cth) regs 4.02, 16.01 Federal Court (Bankruptcy) Rules 2016 (Cth) r 4.04
Cases cited:	American Express International Inc v Held [1999] FCA 321 Civic Video Pty Ltd v Warburton [2013] FCA 934; (2013) 216 FCR 61 Commonwealth Bank of Australia v Horvath (Junior) [1999] FCA 143 Curtis v Singtel Optus Pty Ltd [2014] FCAFC 144; (2014) 225 FCR 458 de Robillard v Carver [2007] FCAFC 73; (2007) 159 FCR 38 Deputy Commissioner of Taxation v Josway Hospitality Pty Ltd [2018] FCA 466 Derma Pharmaceuticals Pty Ltd v HSBC Bank Australia Ltd [2005] SASC 48; (2005) 188 FLR 373 Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87 Fletcher (Trustee) v Keating [2017] FCA 1050 Harris v Caladine [1991] HCA 9; (1991) 172 CLR 84 Jones v Superannuation Complaints Tribunal [2011] FCA 1255; (2011) 198 FCR 71 Kleinwort Benson Australia Ltd v Crowl [1988] HCA 34; (1988) 165 CLR 71 Mbuzi v Favell (No 2) [2012] FCA 311 Napiat Pty Ltd v Salfinger; in the matter of Salfinger (No 7) [2011] FCA 1322; (2011) 202 FCR 264 Re Ferrarese; Ex parte Aloisio (1995) 60 FCR 586 Re Rustic Homes Pty Ltd (1988) 49 SASR 41 Re Scerri (1998) 82 FCR 146 Re Vincent; Ex parte State Bank of New South Wales Ltd (1996) 71 FCR 58 Silvas (a bankrupt) v Official Trustee in Bankruptcy [1997] FCA 206 Skalkos v T & S Recoveries Pty Ltd [2004] FCAFC 321; (2004) 141 FCR 107 Soong v Deputy Commissioner of Taxation [2011] NSWCA 26; (2011) 278 ALR 538 Thompson v Metham [1999] FCA 935
Date of hearing:	5 June 2019
Registry:	Western Australia
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	General and Personal Insolvency
Category:	Catchwords
Number of paragraphs:	66
Counsel for the Applicants:	Mr MJ McPhee
Solicitor for the Applicants:	MJ McPhee Barrister & Solicitor
Counsel for the Respondents:	The Respondents did not appear

ORDERS

		WAD 7 of 2019
BETWEEN:	SAMI ABU-AMSHA First Applicant ; PETER EUGENE MARSZAL Second Applicant
AND:	GERALD ERNEST WAGNER First Respondent ; SHARON DENISE GADE Second Respondent

JUDGE:	BANKS-SMITH J
DATE OF ORDER:	12 JUNE 2019

THE COURT ORDERS THAT:

1. The Registrar's order made 25 February 2019 is affirmed.

2. The application for review is otherwise dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

BANKS-SMITH J:

1. The applicants seek review of a decision of a Registrar of this Court to dismiss the applicants' creditor's petition and an associated application for substituted service of the petition.

2. The petition is based on an allegation of an act of bankruptcy, being that specified in s 40(1)(g) of the Bankruptcy Act 1966 (Cth) (Act), namely that the applicant has obtained against the respondents in the District Court of Western Australia a judgment in the sum of $475,526 plus costs and has served on the respondents a bankruptcy notice, and the respondents have not within the time specified in the notice complied with the requirements of the notice.

3. The petition and substituted service application were dismissed on the basis that the Registrar was not satisfied that the bankruptcy notices had been served on the respondents and in circumstances where there were various failures to comply with the strict requirements of the Act.

4. The Registrar referred to the strict service requirements for service of bankruptcy notices and the relevant case law, and found that the applicants could not rely on a given address as the respondents' 'last‑known address' in circumstances where it was clear that the respondents no longer resided at that address, have not resided at that address for some time, and where the applicants were well aware of those facts. He found that the evidence tendered on behalf of the applicants did not demonstrate strict proof of delivery of the bankruptcy notices and noted that contrary to requirements the bankruptcy notices did not have attached to them a copy of the judgment. The Registrar said the appropriate course was to apply for orders for substituted service of the bankruptcy notice.

5. The Registrar considered that nothing would be gained by granting leave for the applicants to amend the petition or provide further evidence, and dismissed the creditor's petition and substituted service application.

6. In lieu of the orders made by the Registrar, the applicants seek orders that the petition be amended and adjourned to a date to be fixed, and orders for substituted service.

7. The review proceeds under s 35A(5) of the Federal Court of Australia Act 1976 (Cth) and is in the nature of a rehearing de novo: Harris v Caladine [1991] HCA 9; (1991) 172 CLR 84.

8. The applicants sought to establish on this rehearing that the bankruptcy notices have been duly served and that the issue of the service of the bankruptcy notices is a matter to be addressed at the hearing of the application for a sequestration order based on the petition, and not beforehand. As to the failure to attach the judgments to the bankruptcy notices, they submitted that the bankruptcy notices 'identified' the judgment and that the failure to attach them comprises only a formal defect which does not invalidate the bankruptcy notices. The applicants also sought to establish grounds for substituted service of the petition.

The creditor's petition

9. On 8 May 2018 the applicants obtained default judgment against the respondents in the District Court of Western Australia for the amount of $475,526 plus costs. The applicants applied to the Official Receiver for the issue of a bankruptcy notice against each respondent. Based on the face of the bankruptcy notices in evidence, they were issued against the first and second respondents respectively on 28 June 2018 and 29 June 2018 and bear the...