FEDERAL COURT OF AUSTRALIA

Evans v Dekkan [2009] FCA 281

Bankruptcy Act 1966 (Cth) ss 40, 43, 44, 52

VIVIAN EVANS & JOSEPH ANTOUN PRACTICISING AS UTHER WEBSTER & EVANS, SOLICITORS v BASSAM DEKKAN

NSD 1992 of 2008

JACOBSON J

24 MARCH 2009

SYDNEY

THE COURT ORDERS THAT:

1.                  A sequestration order be made against the estate of BASSAM DEKKAN.

2.                  The Applicant Creditors’ costs (including any reserved costs) be taxed and paid from the estate of the Respondent Debtor in accordance with the Bankruptcy Act 1966.

3.                  Pursuant to the Bankruptcy Regulations, the Applicant Creditors give a copy of the Sequestration Order to the Official Receiver within two days.

THE COURT NOTES:

4.                  That the date of the Act of Bankruptcy is 3 July 2008.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using the Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

1                                             The applicant (“Uther Webster & Evans”) applies to the court by a creditor’s petition filed on 23 December 2008 for a sequestration order against the respondent (Mr Dekkan) under section 43 of the Bankruptcy Act 1966 (Cth) (“the Act”). 

2                                             The creditor’s petition is based upon judgment debts totalling $46,332.47 for legal services.  The judgments were entered in the Local Court of NSW, Downing Centre Registry, on 21 December 2007. 

3                                             The act of bankruptcy on which the petition is founded is the failure to comply with the bankruptcy notice NN0324/08 served on Mr Dekkan on 17 February 2008.  Mr Dekkan applied to the court to set aside the Bankruptcy Notice but on 3 July 2008, I ordered that the application to set aside the bankruptcy notice be dismissed: Dekkan v Evans [2008] FCA 1004. 

4                                             I am satisfied that all of the formal requirements set out in sections 43, 44 and 52(1) of the Act have been established. 

5                                             Mr Dekkan appeared in person this morning to oppose the making of a sequestration order.  Prior to the hearing, he filed on 18 March 2009 a document which was intended to comply with order 77, rule 2.06 of the Federal Court Rules, by setting out the grounds of opposition to the petition.  Mr Dekkan also filed an affidavit sworn 18 March 2009. 

6                                             The effect of what Mr Dekkan said in his grounds of opposition and affidavit, both of which were supplemented by what he said this morning, was that I ought to exercise my discretion under section 52(2)(b) of the Act to dismiss the petition.  There were, in substance, two reasons for this.

7                                             First, Mr Dekkan has filed a notice of appeal against my order of 3 July 2008 declining to set aside the bankruptcy notice.  Second, Mr Dekkan says that he has a claim against Uther Webster for an amount exceeding the amount of the judgment debts. 

8                                             The notice of appeal against my orders of 3 July 2008 came before Lander J on 18 December 2008.  The proceedings were numbered NSD1092/2008.  Lander J dealt with the matter on a video link, and made orders that unless Mr Dekkan had filed and served a draft index of the appeal papers and certain other documents by 24 December 2008, the appeal would stand dismissed for want of prosecution pursuant to order 53, rule 20.  His Honour’s order also provided that unless certain other steps were taken in January for the settling of the appeal papers and for their filing, the appeal would stand dismissed on the same basis. 

9                                             Mr Dekkan did not file or serve a draft index by 24 December 2008.  Accordingly, the effect of Lander J’s order is that the appeal stands dismissed for want of prosecution. 

10                                         Mr Dekkan accepted before me this morning that the appeal has been dismissed.  He told me that he intended, in some way, to seek to pursue it.  I do not see that this is a course which has any real prospects, because leave to appeal from Lander J’s orders would have been required and the time for so doing has well and truly expired. 

11                                         Moreover, although Lander J apparently proceeded upon the basis that there was an appeal as of right from my orders, the order which I made on 3 July 2008 was interlocutory.  Accordingly, there was no appeal as of right from my order and the notice of appeal was incompetent. 

12                                         The second basis upon which Mr Dekkan asked me to exercise my discretion is similarly flawed.  He did refer in his affidavit to a statement of claim filed in the Supreme Court in Supreme Court proceedings number 3394/08.  However, he conceded before me this morning that the statement of claim has been dismissed.  Nevertheless, as with the orders made by Lander J, Mr Dekkan appears to be intent upon, in some way, pursuing a course designed to reinstate the proceedings. 

13                                         The concession which Mr Dekkan made is a sufficient basis for me to decline to exercise my discretion to dismiss the petition.  However, there is a further answer to this ground of opposition.  The alleged cross-claim appears to be the same as the claim for damages and the statement of claim to which I referred in my judgment of 3 July 2008. 

14                                         I gave reasons in my earlier judgment as to why Mr Dekkan had not reached the threshold required on an application to set aside the bankruptcy notice.  I came to the view on that occasion that Mr Dekkan had failed to satisfy me of the matters required by section 40(1)(g) of the Act.  

15                                         No evidence was filed by Mr Dekkan to support any finding other than that which I reached in my earlier reasons.  Mr Dekkan sought to meet the difficulties arising from his failure to file evidence to support his claim and his failure to prosecute any appeal against my judgment by reference to his own medical condition and that of his mother.

16                                         Whilst I can of course sympathise with Mr Dekkan in relation to those difficulties, they are simply not an answer to the absence of any evidence before me.  Registrar Hedge made orders on 4 March 2009 that Mr Dekkan file evidence in support of his opposition by 12 March 2009.  That was not complied with.  The matter came before me on 18 March 2009 and Mr Dekkan informed me on that occasion about his medical problems and those of his mother. 

17                                         Nevertheless, there is still no evidence before me to support in any way the claim which he asserts against Uther Webster & Evans.  In those circumstances there is no basis for me to exercise my discretion under section 52(2)(b) of the Act to dismiss the petition.  I am therefore satisfied that I should make a sequestration order against the estate of Mr Dekkan. 

18                                         I have also taken into account two other matters in declining to exercise my discretion.  The first is that Mr Dekkan sought pro bono assistance.  He has made a number of applications for this, but I see no reason why I ought to make an order under order 80 of the Federal Court Rules. 

19                                         The second matter is that there is another creditor’s petition outstanding against Mr Dekkan.  That petition has been brought by Macquarie Leasing and the petition appears to have been listed for hearing before Smith FM on 14 April 2009.  It seems to me that, on the evidence which has been filed in this application, the act of bankruptcy in the present matter is an earlier act of bankruptcy than that which is relied upon by Macquarie Leasing.

20                                         I will therefore make orders in terms of paragraphs one, two, three and four of the draft orders which I will sign and date and place with the court papers.

Associate:

Dated:         24 March 2009