Whiteman v Deputy Commissioner of Taxation (No 2) [2022] FCA 1037

Federal Court of Australia

Appeal from:	Deputy Commissioner of Taxation; in the matter of Whiteman v Whiteman [2021] FedCFamC2G 131

File number(s):	VID 621 of 2021

Judgment of:	WHEELAHAN J

Date of judgment:	5 September 2022

Catchwords:	BANKRUPTCY – costs of appeal – where the appellant was unsuccessful in an appeal from a review of the making of a sequestration order – whether the costs of the appeal should be paid by the appellant personally, or out of the appellant’s bankrupt estate – costs ordered to be paid out of the appellant’s estate

Legislation:	Bankruptcy Act 1966 (Cth) section 109(1)(a)

Cases cited:	Culleton v Balwyn Nominees Pty Ltd (No 2) [2017] FCAFC 12 Whiteman v Deputy Commissioner of Taxation [2022] FCA 975

Division:	General Division

Registry:	Victoria

National Practice Area:	Commercial and Corporations

Sub-area:	General and Personal Insolvency

Number of paragraphs:	2

Date of last submission/s:	24 August 2022

Date of hearing:	Determined on the papers

Counsel for the Appellant:	Mr L Wirth (pro bono)

Counsel for the Respondent:	Mr S Linden

Counsel for the Respondent:	MinterEllison

ORDERS

		VID 621 of 2021

BETWEEN:	PHILIP WHITEMAN Appellant
AND:	DEPUTY COMMISSIONER OF TAXATION Respondent

order made by:	WHEELAHAN J
DATE OF ORDER:	5 September 2022

THE COURT ORDERS THAT:

1. The respondent’s costs of the appeal, including reserved costs, are to be taxed and paid out of the estate of the appellant in accordance with s 109(1)(a) of the Bankruptcy Act 1966 (Cth).

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

REASONS FOR JUDGMENT

WHEELAHAN J:

1 I gave judgment in this appeal on 22 August 2022: Whiteman v Deputy Commissioner of Taxation [2022] FCA 975. I dismissed the appeal, with the consequence that the appellant’s estate remains subject to the sequestration order that was affirmed on review by the primary judge. Upon giving judgment, I understood counsel for the appellant to accept that costs should follow the event. However, counsel for both parties sought an opportunity to make written submissions to the court on the question whether the appellant should pay the costs of the appeal personally, or whether the respondent’s costs of the appeal should be paid out of the estate of the appellant in accordance with s 109(1)(a) of the Bankruptcy Act 1966 (Cth). For this purpose, I reserved the question of costs of the appeal, to be determined on the papers.

2 Counsel for both parties submitted, by reference to authority, that the standard course is that the costs of a successful respondent on an appeal such as the present should be paid out of the appellant’s estate. Those submissions were supported by the decision of the Full Court in Culleton v Balwyn Nominees Pty Ltd (No 2) [2017] FCAFC 12 (Allsop CJ, Dowsett and Besanko JJ). I accept the parties’ submissions. Accordingly, the order of the court as to costs will be –

The respondent’s costs of the appeal, including reserved costs, are to be taxed and paid out of the estate of the appellant in accordance with s 109(1)(a) of the Bankruptcy Act 1966 (Cth).

I certify that the preceding two (2) numbered paragraphs are a true copy of the Reasons for Judgment of Justice Wheelahan.

Associate:

Dated: 5 September 2022

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