FEDERAL COURT OF AUSTRALIA

Mulhern v Pearce [2012] FCA 631

THE COURT ORDERS THAT:

1.    The application under rule 35.14 of the Federal Court Rules 2011 to extend time for leave to appeal from orders of the Court made on 19 April 2012 is dismissed.

2.    The applicant pay the costs of the respondent trustees of and incidental to the application to be taxed.

3.    The interlocutory application filed electronically on 31 May 2012 for review under s 178(1) of the Bankruptcy Act 1966 (Cth) of a decision of the trustees of the bankrupt is dismissed.

4.    The applicant pay the costs of the respondent trustees of and incidental to the interlocutory application to be taxed.

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

REASONS FOR JUDGMENT

1    These proceedings concern two applications made by Mr Michael Richard Mulhern. Both applications have been heard together.

2    The first application in time is an application under rule 35.14 of the Federal Court Rules 2011 for an extension of time to seek leave to appeal from an order of the Court made by Logan J on 19 April 2012 in proceedings described as Mulhern, in the matter of Mulhern (Bankrupt) v Pearce (Trustee) [2012] FCA 570. The second application is an interlocutory application filed by Mr Mulhern on 31 May 2012 by which Mr Mulhern seeks an order that a decision of the trustees of his estate, Messrs Pearce and Heers, refusing the return to the applicant of his “non-Australian” passports, be reviewed pursuant to s 178(1) of the Bankruptcy Act 1966 (Cth). The decision to refuse the applicant the return of his passport documentation was made by the trustees on 25 May 2012.

3    These applications need to be put in context.

4    On 2 October 2009, Daubney J in the Supreme Court of Queensland made orders in proceedings between Mr Dodrill, The Irish Restaurant & Bar Company Pty Ltd, Mulhern Constructions Pty Ltd and Michael Richard Mulhern requiring, among other things, Mr Mulhern to pay Mr Dodrill the sum of $334,875.00 within 21 days of service of a copy of the order, and required Mr Mulhern to pay Mr Dodrill’s costs of and incidental to those proceedings including reserved costs to be assessed on an indemnity basis.

5    On 3 February 2010, Registrar Belcher made a sequestration order against the estate of Mr Mulhern. The act of bankruptcy relied upon by Mr Dodrill was a failure on the part of Mr Mulhern to pay the amount reflected in the order of Daubney J which was the subject of a Bankruptcy Notice issued by the Official Receiver on 26 October 2009 at the request of Mr Dodrill, and served according to the particular method the subject of an order of the Federal Magistrates Court of Australia made on 4 November 2009.

6    On 13 April 2012, Mr Mulhern filed an application in this Court by which he sought an order under s 153B of the Bankruptcy Act that the bankruptcy be annulled (QUD 208/2012). He also sought orders for the payment of costs against Mr Dodrill and Messrs Pearce and Heers. In support of the application for an annulment of the bankruptcy, Mr Mulhern principally relies upon an affidavit sworn by him on 5 April 2012 and filed on 13 April 2012. Mr Mulhern also relies upon this affidavit in both of the applications presently before the Court. The facts and matters asserted by Mr Mulhern in that affidavit are fundamentally directed to seeking to demonstrate, for the purposes of s 43(1)(b) of the Bankruptcy Act, that at the time when the act of bankruptcy was committed, none of the connecting factors recited at s 43(1)(b)(i) to (iv) were satisfied.

7    Those matters are directed to whether the debtor was personally present or ordinarily resident in Australia; whether the debtor had a dwelling-house or place of business in Australia; whether the debtor was carrying on business in Australia either personally or by means of an agent or manager; or whether the debtor was a member of a firm or partnership carrying on business in Australia by means of a partner or partners or an agent or manager. Under s 43, subject to the Bankruptcy Act, the Court may, on a petition presented by a creditor, make a sequestration order against the estate of a debtor where a debtor has committed an act of bankruptcy and at the time when the act of bankruptcy was committed, one of the connecting factors described above is satisfied.

8    The substantive hearing of Mr Mulhern’s application for an annulment was dismissed by Dowsett J on 17 May 2012 together with an order that Mr Mulhern pay the costs of the respondents to the application.

9    I will return to an aspect of that matter later in these reasons.

10    The application for an annulment of the bankruptcy filed by Mr Mulhern on 13 April 2012 also sought an interim order requiring that the trustees return to him his passport and travel documentation. The affidavit material in support of that interim order referred to a decision of the trustees made on 3 April 2012 to refuse Mr Mulhern the return of that documentation and refusing him permission to travel overseas.

11    The application for these interim orders was heard before Logan J on 19 April 2012. Logan J dismissed the application and ordered Mr Mulhern to pay the costs of the trustee of and incidental to the application.

12    The application before Logan J involved a review of the trustees’ decision pursuant to s 178 of the Bankruptcy Act. Section 178(1) provides, relevantly, that if the bankrupt is affected by a decision of the trustee, he or she may apply to the Court and the Court may make such order in the matter “as it thinks just and equitable”. The contextual history of the proceedings involving Mr Mulhern relevant to Logan J’s consideration of the application then before his Honour, is set out at [5] of the reasons, as set out below:

5.    There is a history to this matter in this Court following the making of the sequestration order, so far as Mr Mulhern’s present presence in Australia is concerned. That history commences with an order which I made in August last year for the issuing of a warrant pursuant to s 78 of the Bankruptcy Act for Mr Mulhern’s arrest: see Pearce (Trustee) v Mulhern (Bankrupt) [2011] FCA 930. A sequel to that was Mr Mulhern’s arrest upon his coming to Australia in January 2012. That in turn led to consequential proceedings as a result of that arrest, initially before Buchanan J: see Pearce (Trustee) v Mulhern (Bankrupt) (No 2) [2012] FCA 7; and thereafter before Flick J: see Pearce (Trustee) v Mulhern (Bankrupt) (No 3) [2012] FCA 16. The following month, ie, in February this year, an application of the present kind was heard by Jagot J. Her Honour dismissed that application for reasons which she delivered on 2 February 2012: see Pearce (Trustee) v Mulhern (Bankrupt) (No 4) [2012] FCA 54.

13    As Logan J observes, a similar application had been made before Jagot J in February 2012 and on that occasion Jagot J dismissed the application with costs: Pearce (Trustee) v Mulhern (Bankrupt) (No 4) [2012] FCA 54, 2 February 2012. That decision involved a review under s 178 of the Bankruptcy Act of a decision of the trustee early in 2012. The decision of the trustee reviewed by Logan J under s 178 was a decision of the trustee made on 3 April 2012. That decision was made against the background of the facts and circumstances as they stood on 3 April 2012 which, Logan J notes, were not in all material respects the same circumstances as prevailed in January and early February 2012. In other words, the application before Logan J was not simply a further application to review a later decision of the trustee where there had been no material change in circumstances. Certainly, the trustee seemed to accept that position.

14    In determining whether Mr Mulhern had discharged the onus of persuading the Court that it is just and equitable to make the order sought, Logan J had regard to a number of factors, including the following.

15    First, his Honour had regard to Mr Mulhern’s affidavit and accepted that the affidavit at least “goes to show that there is a basis for challenging the sequestration order”. Of course, Logan J made no observations about the ultimate merits of that contention but regarded that matter as relevant for the purposes of the inquiry then before his Honour.

16    Second, Logan J had regard to the factual contentions that Mr Mulhern is not presently ordinarily resident in Australia.

17    Third, it was common ground before Logan J that Mr Mulhern’s wife resides in New York in the United States together with their children and that Mr Mulhern’s father had passed away during the period that Mr Mulhern has been in Australia with the result that the refusal of permission to travel overseas prevented Mr Mulhern from returning to Ireland to attend a funeral service for his father and extend comfort to Mr Mulhern’s widowed mother. Logan J regarded all of these factors as relevant in the exercise of jurisdiction under s 178 of the Bankruptcy Act. Logan J recognised that each of these matters are important emotional and humane considerations suggesting perfectly understandable reasons why Mr Mulhern would wish to secure the return of his travel documentation and travel out of Australia.

18    The central point of principle in the exercise of jurisdiction under s 178 is whether the restriction upon and refusal of travel is required for the purpose of ensuring the due administration of the bankrupt estate under the Bankruptcy Act and the proper discharge of obligations under that Act by the bankrupt, and correspondingly, the performance of obligations of the trustee which are dependent upon the support and cooperation of the bankrupt as required under the Bankruptcy Act: Re Tyndall (1977) 30 FLR 6; Re Hicks; Ex parte Lamb (1994) 217 ALR 195.

19    A restriction upon travel and refusal to return a passport and related travel documentation is not supportable on the basis of imposing a penalty upon the bankrupt.

20    At [14], Logan J observed that the trustees had set out in a letter of 3 April 2012 their reasons for refusing the requests made of them by Mr Mulhern (by the solicitors then acting for him). That letter set out 10 considerations which the trustees took into account in reaching their decision. It is convenient to simply set out below the 10 reasons quoted by Logan J at [14] and they are these:

1.    You have not offered to provide any surety to support your assertion that you will return to Australia.

2.    Your evidence in the public examination held on 17 January 2012 was that your entire family is resident in New York.

3.    You have no identifiable assets in Australia.

4.    I calculate that your personal debts in Australia (including the debt which you owe to the Bank of Queensland debt) to be in excess of $60,000,000.

5.    You made admissions during your public examinations that you had left Australia on two (2) occasions in February and August 2011 without seeking my consent because you felt that you had no obligation to do so.

6.    You have not offered any undertaking to the Court (or to me) to return to Australia, should I grant your request. It appears to me based on the letter from your solicitors, Hynes Lawyers, dated 2 March 2012, that it is in fact your intention to not return to Australia.

7.    You initially failed to attend public examinations under Section 81 of the Bankruptcy Act 1966 (Cth) (“the Act”) despite being personally served with a Summons to do so on or about 19 July 2011.

8.    You have breached the undertakings which you gave to the Federal Court of Australia on 16 January 2012 casting serious doubt on the worth of any undertaking given by you to return to Australia and your ultimate trustworthiness.

9.    I have been advised by Lynch Morgan Lawyers, the solicitors for the petitioning creditor, Mitch Dodrill, that you informed Mr Dodrill in a telephone conversation which took place shortly before 2 March 2012, that if you left Australia you would never return. Lynch Morgan Lawyers have also advised that Mr Dodrill is prepared to swear an affidavit to this conversation.

10.    You have generally failed to comply with your duties as a bankrupt throughout the period of your bankruptcy, including, but not limited to:

a)    You have failed to properly answer questions put to you by my staff and I regarding your examinable affairs.

b)    You have failed to provide me with information and documentation, when requested to do so in writing, regarding assets which you own, including, but not limited to:

    An apartment which you own with your wife at Suite 1203, 175 Huguenof Street, New York, USA, which appears to be valued at over $US1,000,000.

    Properties which you jointly own with your wife at 10 and 12 Brittany Lane, New Rochelle, New York, USA which appear to have a combined value of over $US7,500,000.

    Your interest in Celtic Pacific General Building Contractors, LLC (“Celtic”), which appears to own a property at 8 Brittany Lane, New Rochelle, New York, USA.

c)    You have failed to provide me with information and documentation, when requested to do so, relating to other matters which are relevant to the administration of your bankruptcy.

d)    You have failed to pay required amounts of income contributions, as assessed by me.

e)    You have failed to arrange to pay funds which you held in your bank account at the date of your bankruptcy to me.

f)    You failed to voluntarily deliver your passports to me, despite being notified by me in writing that you were required to do so.

g)    You have failed to attend public examinations under Section 81 of the Act, despite being personally served with a Summons to do so.

h)    You have left Australian on two (2) occasions during the period of your bankruptcy without seeing my written consent.

i)    On 28 February 2012, you failed to accept two (2) letters which Michael Dullaway of my office and I attempted to personally hand to you, requiring you to attend a number of outstanding matters relevant to the administration of your bankruptcy.

21    Having regard to those matters, the trustees observed that Mr Mulhern’s consistent failure to comply with duties cast upon him under the Bankruptcy Act was not only frustrating the administration of the bankrupt estate but also caused the trustees to hold serious concerns that, should Mr Mulhern’s passports be returned to him and permission be given for him to travel overseas, Mr Mulhern would not return to Australia in the event that the trustees requested him to do so.

22    Logan J was satisfied that the evidence led by the trustees bore out each of the 10 matters to which the trustees had referred. I have examined that material for the purposes of the present applications and I am similarly so satisfied.

23    In the proceedings before Logan J, Mr Mulhern, as he did in these proceedings in the course of agitating both applications, attributed malice and misconduct to the Bank of Queensland in the way in which it has conducted itself concerning loans made to Mulhern related entities and the exercise of rights under securities given by those entities to the Bank. Mr Mulhern is a guarantor of those facilities and proceedings concerning the exercise of rights by the Bank have been conducted before the Supreme Court of Queensland. Many of those matters may well be taken up by Mr Mulhern with the Bank in aspects of those proceedings.

24    Quite apart from the issues as between Mr Mulhern, entities in which he has or formerly had an interest, and the Bank of Queensland, Mr Dodrill obtained a judgment in the Supreme Court of Queensland which is the foundation of the Bankruptcy Notice, the ultimate act of bankruptcy and the making of the sequestration order.

25    That judgment remains on foot.

26    A further matter noted by Logan J in exercising the jurisdiction under s 178 of the Bankruptcy Act was that in Pearce v Mulhern [2010] FCA 446, the Federal Court determined that Mr Mulhern is the registered holder of the issued share capital in Mulhern Constructions Pty Ltd and Dicey’s Gladstone Pty Ltd and that Mr Mulhern is the holder of half of the issued shares in Celtic Pacific Properties Pty Ltd. On the evidence before Logan J, it appeared that Mr Mulhern had transferred, after the date of the sequestration order, shares in an overseas company to his wife.

27    Logan J also noted that Mr Mulhern had asserted before him, as he asserted in these proceedings, that he has no assets in Australia and that there is no point in subjecting Mr Mulhern to the administration of his estate in bankruptcy in Australia. He says that he is an international businessman and in terms of his own individual personal assets, there are none in Australia, and the bankruptcy proceedings are inflicting great personal distress and harm upon him in terms of the consequences of the bankruptcy in his dealings in other assets outside of Australia secured in favour of other lenders. Logan J observed that notwithstanding observations of this kind, the evidence demonstrated that there are real questions in relation to Mr Mulhern’s interests in assets which remain unanswered.

28    The trustees are entitled to ask questions of the bankrupt concerning his affairs in order to determine the nature of any interests that might represent property of the bankrupt falling within the administration. Moreover, the Bankruptcy Act makes it plain that a bankrupt has a statutory obligation to assist the trustees in the administration of the bankrupt estate.

29    Having regard to those factors, Logan J was not persuaded that it is just and equitable to make an order overturning the decision of the trustees and having the effect of returning to Mr Mulhern his passports and travel documentation and granting him permission to leave Australia.

30    I am not satisfied that any error is demonstrated on the part of Logan J.

31    Rule 35.12 of the Federal Court Rules contemplates that a person who wants to apply for leave to appeal must file an application in accordance with Form 117 and Rule 35.13 provides that the application must be filed within 14 days after the date on which the judgment was pronounced (19 April 2012). Rule 35.14 contemplates that a person who wants to apply for an extension of time to seek leave to appeal must file an application in accordance with Form 118 and the application must be supported by an affidavit stating the facts on which the application is based and why the application for leave to appeal was not filed within time. The application must also be supported by a draft Notice of Appeal that complies with rules 36.01(1) and (2) of the Federal Court Rules.

32    As to an explanation of the failure to make the application within time, Mr Mulhern says that he chose not to make the application within 14 days of 19 April 2012 because he thought it would be disrespectful to the primary judge to do so in circumstances where steps had been taken to secure an expedited hearing of the annulment application for 17 May 2012 and thus the focus of Mr Mulhern’s attention became the merits and progression of the annulment application.

33    I accept that the focus of Mr Mulhern’s efforts became the question of addressing the annulment application which explains why Mr Mulhern did not agitate contended errors on the part of Logan J in the exercise of the review jurisdiction under s 178. However, I am not satisfied that any ground of error has been identified. There is no draft Notice of Appeal filed. In any event, no arguable ground of error has been made out. Accordingly, the application for leave to extend time to enable an appeal to be made from the orders of Logan J must be dismissed.

34    That brings me back to the annulment application itself.

35    That application was dismissed by Dowsett J on 17 May 2012.

36    It would be obvious to Mr Mulhern that an application for an annulment of a bankruptcy is a matter which properly raises questions of interest to persons affected by such an order and notably, unsecured creditors. An unsecured creditor, such as Mr Dodrill and any other unsecured creditors that may exist, have an interest in being heard on such an application. Rule 7.02 of the Federal Court (Bankruptcy) Rules 2005 provides that an application properly setting out the grounds on which the annulment is sought must be served on the trustee at least seven days before the hearing date fixed for the application. Rule 7.03 provides that the applicant must give notice of the application to each person known to the applicant to be a creditor of the bankrupt; the notice must be in accordance with Form 11; and the applicant must serve the notice on each creditor at least seven days before the hearing date fixed for the application.

37    When the application came before Dowsett J, the affidavit material reflected that Mr Dodrill had not been served with the application. Moreover, Dowsett J sought, on a number of occasions, to determine whether Mr Mulhern would be willing to give an undertaking to the Court to serve all of the unsecured creditors with the annulment application, with the result that upon performance of that undertaking the matter might be determined with some urgency. Mr Mulhern was not willing to give that undertaking unless an order was also made that Mr Mulhern’s passport and travel documentation be returned to him. Dowsett J was not willing to make that order and since Mr Mulhern was not willing to give the undertaking to serve unsecured creditors with the annulment application, the application was dismissed.

38    It follows that there is presently no application for annulment of the bankruptcy before the Court.

39    There is an extant sequestration order.

40    Mr Mulhern has appealed from the order of Dowsett J dismissing the annulment application.

41    In the course of the present applications, I strongly suggested to Mr Mulhern that he ought to seek legal advice in relation to these matters and give consideration to the question of whether an application for an annulment ought to be made supported by proper material with appropriate notice being given to Mr Dodrill and any other person who Mr Mulhern knows to be a creditor (or knows of a claim to be a creditor). Mr Mulhern submitted that ultimately he did not wish to give the undertaking sought by Dowsett J as he did not want to put himself in a position where he made prejudicial admissions that any particular person was properly described as one of his “creditors”. Mr Mulhern disputes that he has creditors and was concerned to avoid any suggestion of a concession or admission that by serving any one or more persons on that footing, he would be conceding that X or Y was in fact a creditor. Nevertheless, Mr Dodrill is a creditor. Service of notice of the annulment application on persons who contend that they might be creditors does not seem to me to carry with it a prejudicial concession that such a person might be a creditor, properly so described. Nevertheless, Mr Mulhern needs to seek legal advice about these questions. If there is a proper basis for an annulment of the bankruptcy on the footing that the jurisdictional connecting factors are not made out for the purposes of s 48 of the Bankruptcy Act, that matter needs to be addressed on the merits with some degree of urgency.

42    The second application is an application for review under s 178 of the Bankruptcy Act of a fresh decision of the trustees to refuse Mr Mulhern the return of his passport and travel documentation and permission to travel out of Australia. This further decision was made by the trustees on 29 May 2012 and is reflected in two letters attached to Mr Mulhern’s affidavit of 29 May 2012 as Exhibits 51 and 52 (the affidavit and exhibits also being attached to the interlocutory application itself).

43    In the trustees’ letter of 25 May 2012, they note the request made by Mr Mulhern for a return of his passports and observe that Mr Mulhern has previously requested such a return and has applied unsuccessfully to the Court for orders of review on two occasions. The trustees observe:

I have informed you on a number of occasions that I will not return your passports to you whilst you fail to comply with your duties to co-operate and assist with the administration of your bankrupt estate by providing information and documents I have requested from you, including a copy of your father’s Will and the information and documents requested in my (2) letters to you dated 18 January 2012 which I personally served on you on that date and on 18 May 2012.

I again encourage you to assist me in my administration of your bankrupt estate and request that you immediately provide me with outstanding information and documents requested in accordance with your duties pursuant to Section 77 of the Bankruptcy Act 1966 (Cth).

44    On 29 May 2012, the trustees acknowledged a facsimile which seems to have been sent by Mr Mulhern on 25 May 2012 and, in response, the trustees say this:

I advise as follows:

1.    You have previously requested that I return your passports to you and you have unsuccessfully applied to the Court for them to be returned to you on (2) occasions.

2.    I have enclosed a copy of my letter to you dated 3 April 2012, which was in respect of a request for the return of your passports received from your solicitors, Hynes Lawyers on 2 March 2012.

3.    I do not consider that the circumstances relevant to the administration of your bankrupt estate and your request for the return of your passports have materially changed since I ruled on your previous request for the return of your passports on 3 April 2012.

4.    Accordingly, for the reasons set out in my letter to you dated 3 April 2012 (copy enclosed) and having regard to matters which are relevant to the administration of your bankrupt estate, I decline to provide you with your passports.

In accordance with your duties pursuant to Section 77 of the Bankruptcy Act 1966 (Cth), I require you to immediately attend to the following matters:

1.    Execute the acknowledgement attached to my letter to you dated 3 April 2012 confirming receipt of the document titled “Notification of Bankruptcy and Some Responsibilities of a Bankrupt” and return the executed acknowledgement to me.

2.    Provide me with a copy of your father’s Will, as requested in my email to you sent 31 January 2012 and a number of times thereafter.

3.    Provide me with the information and documents requested in my (2) letters to you dated 18 January 2012, which I personally served on you on that date and on 18 May 2012 and which I have previously sent to your solicitors on a number of occasions.

45    The letter concluded by observing that should Mr Mulhern have any queries, he ought to contact Mr Michael Dullaway at the office of the trustees.

46    Plainly enough, the trustees in making the decision to refuse Mr Mulhern the return of his passports and travel documentation was based upon a continuing concern about each of the 10 matters reflected in the letter of 3 April 2012; an assessment that the circumstances relevant to the administration of the bankrupt estate had not materially changed from 3 April 2012 and that the reasons governing the decision of 3 April 2012 continued to be the material reasons for the decision. Moreover, the trustees requested Mr Mulhern to return the acknowledgement concerning receipt of the “Notification” document; provide a copy of Mr Mulhern’s father’s Will (in order to assess the question of whether after acquired property was in issue for the purposes of the Bankruptcy Act); and provide the information requested in the letters of 18 January 2012.

47    Mr Mulhern supports the application with an affidavit dated 22 May 2012 and filed on 23 May 2012. In that affidavit, Mr Mulhern says that he has been “forced to endure horrific events orchestrated by Bank of Queensland and its agents affecting me and my Australian family now living in the USA”. Mr Mulhern’s affidavit of 22 May 2012 is principally directed to explaining the delay in seeking leave. However, the affidavit deposes to the emotional pressure Mr Mulhern is experiencing by reason of the intervention of the bankruptcy. Mr Mulhern also relies upon an affidavit he swore on 4 June 2012 filed on the morning of the application on 5 June 2012 in proceedings between his wife and the Bank of Queensland for the purposes of proceedings before the Court of Appeal of the Supreme Court of Queensland. Those matters go to the contentions concerning the conduct of the Bank of Queensland, views about asset values, debt levels, and the extent to which the Bank has entered into possession under securities and taken steps to enforce its securities. At para 4 of that affidavit, Mr Mulhern acknowledges that he is a personal guarantor of the debts of the relevant entities. His guarantee instrument is dated 19 May 2006.

48    Mr Mulhern also recites that he relies upon his affidavit sworn 5 April 2012 and filed on 13 April 2012 together with an affidavit sworn 16 May 2012 and filed on 18 May 2012. Mr Mulhern also relies upon an affidavit sworn on 3 May 2012. These affidavits are affidavits sworn in the annulment proceedings dismissed by Dowsett J. Fundamentally, those affidavits go to the circumstances concerning Mr Mulhern’s place of residence, arrangements with the Bank of Queensland, the contended conduct of the Bank of Queensland and the personal circumstances affecting Mr Mulhern going to the question of whether an order ought to be made for the purposes of s 153B(1) of the Bankruptcy Act.

49    In Mr Mulhern’s affidavit sworn 29 May 2012 he says at para 3 that the Australian bankruptcy “was orchestrated in my absence from Australia and was clearly done as an abuse of process in breach of the law” and that since May 2007 he has “worked, lived and permanently resided in New York, USA with my family”, and at para 4 he reasserts that the trustees have unreasonably and consistently refused to return his travel documentation including passports to him which has caused him and his family “horrific emotional suffering”. He also asserts that the trustees are aware of the “commercial damage being caused in the USA and Australia to the Mulhern family interests”.

50    I have considered the affidavits relied upon by Mr Mulhern. The affidavits represent a reassertion of the matters previously relied upon and although I accept that the continuing passage of time incrementally increases the pressure upon Mr Mulhern, I am satisfied that the decision of the trustee ought not to be interfered with in the exercise of jurisdiction under s 178 of the Bankruptcy Act. The material suggests that none of the matters the subject of the letter of 3 April 2012 have been addressed; no material change in circumstances has occurred since then; information has not been provided to the trustees as sought by the trustees; and Mr Mulhern continues to fail to cooperate and assist the trustees. No doubt that follows because Mr Mulhern believes that no sequestration order ought to have been made and that, in those circumstances, he would prefer not to cooperate. However, the trustees have statutory obligations and duties to discharge and a bankrupt has a statutory obligation to cooperate and assist the trustees.

51    If Mr Mulhern wants to seek remedial orders annulling the bankruptcy on particular grounds identified by him, he must formulate a proper application which identifies those grounds, supported by proper material, served upon persons required to be provided with the application and related material under the Federal Court Rules 2011, and take steps to advance that application to an urgent hearing and determination. In the meantime, Mr Mulhern ought to take legal advice on the nature and scope of the obligations cast upon him by the Bankruptcy Act in terms of his dealings with the trustees and any other relevant obligations arising under that Act. Those obligations will continue to subsist unless and until an annulment order is made in Mr Mulhern’s favour.

52    It follows that each application must be dismissed with costs.

Associate:

Dated:    19 June 2012