Cohen & Anor v Black [2002] FMCA 20 (6 February 2002)

Last Updated: 30 April 2002

FEDERAL MAGISTRATES COURT OF AUSTRALIA

COHEN & ANOR v BLACK

[2002] FMCA 20

BANKRUPTCY - Creditor's Petition - act of bankruptcy alleged - debtor with intent to defeat or delay her creditors begins to keep house.

Bankruptcy Act 1966 (Cth), s 40(1)(c)(iv)

Federal Court Rules, O 77 Div 4

Fisher v Boucher [1830] EngR 560; (1830) 109 ER 612 referred to.

Applicants:

GEOFFREY JAMES COHEN ROBYN ANN COHEN

Respondent:

SARA SUSAN BLACK

File No:

MZ 856 of 2001

Delivered on:

6 February 2002

Delivered at:

Melbourne

Hearing Date:

4 February 2002

Judgment of:

Hartnett FM

REPRESENTATION

Counsel for the Applicants:

Mr Gorr

No appearance by Respondent

ORDERS

THE COURT ORDERS THAT:

(1) The Creditor's Petition filed 11 December 2001 is dismissed.

(2) There is no order as to costs.

FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE

MZ 856 of 2001

GEOFFREY JAMES COHEN ROBYN ANN COHEN

Applicants

And

SARA SUSAN BLACK

Respondent

REASONS FOR JUDGMENT

1. Before the Court is a Creditor's Petition filed on behalf of the applicants on 11 December 2001. The petition is in accordance with that as described by the Federal Magistrates Court Rules 2001, Rule 31.02 and the Federal Court Rules O 77 r 16 and s 47 of the Bankruptcy Act 1966 (Cth).

2. There is no appearance by or on behalf of the respondent debtor.

3. There is also filed on behalf of the applicants:

a) an affidavit of GEOFFREY JAMES COHEN of the truth of statements in paragraphs 1, 2 and 3 of the Creditor's Petition;

b) an affidavit of JOHN GORR verifying paragraph 4 of the Creditor's Petition;

c) an affidavit of personal service of the petition and affidavits as set out in (a) and (b) on the respondent, service being effected on

4 December 2001, this affidavit being provided pursuant to O 77

r 19 of the Federal Court Rules; and

d) an affidavit of liability sworn 12 December 2001, filed 13 December 2001.

4. Mr Gorr, Counsel for the applicants, submitted to the Court that he would file on the day of hearing an affidavit of service as required by Order 2 of the orders made by Registrar Efthim on 13/12/2001, together with an affidavit of search. These documents have not been filed as at this date and there has therefore been non-compliance with O 77 r 19(3) and (5) in particular.

5. The Creditor's Petition alleges that the respondent debtor owes the applicant creditors the sum of $27,932.70 as a result of proceedings in the Magistrates Court of Victoria at Melbourne, wherein an order was made on 25 July 2001. No copy of that order is before me.

6. The specifying of the alleged act of bankruptcy in the Creditor's Petition is fundamental. The acts of bankruptcy allegedly committed by the respondent debtor are as set out in paragraph 4 of the Creditor's Petition. They are as follows:

(1) On 17/6/2001 she kept house;

(2) On 19/6/2001 she kept house;

(3) On 25/6/2001 she kept house.

7. In submissions made on behalf of the applicant creditors, Mr Gorr urged me to find an act of bankruptcy in his attending at the premises of the respondent on the 17^th and 19^th days of June 2001 for the purposes of effecting personal service of the applicant's complaint issued out of the Melbourne Magistrates Court. The evidence before me is that on each of these occasions a young child came to the door and on each occasion Mr Gorr could hear a woman's voice in the background saying words to the effect of "Tell them mummy isn't home" (Mr Gorr being the person who was endeavouring to effect personal service). Upon his further attendance at the respondent's premises on 25 June 2001, Mr Gorr did in fact serve the respondent personally with the complaint issued out of the Melbourne Magistrates Court as the respondent on that occasion met him on the front doorstep of her home. Mr Gorr deposes to using a subterfuge when he served the complainant on 25/6/2001.

8. There is no evidence before me which enables me to determine the intent of the respondent on either of the 17^th or 19^th days of June 2001 to be one of defeating or delaying her creditors or indeed any evidence wherein I could reasonably infer that intention on her part.

9. Counsel for the applicants has sought to argue that the presentation of a young child at the door with a woman's voice in the background saying words to the effect of "Tell them mummy isn't home" is, on the part of the respondent, a beginning to keep house with intent to defeat or delay her creditors. Some short time after the 17^th and 19^th days of June 2001, the respondent did in fact appear at the front of her home and accepted service of the complaint issuing out of the Melbourne Magistrates Court. It could not be said on 25 June 2001 that she began to keep house. Personal service was again effected upon the respondent on 4 December 2001, being personal service of these proceedings. Service was effected at the same address and the respondent answered when called by name. There is no evidence before me that the respondent debtor in these proceedings has withdrawn to a secret part of her house; nor that she has rarely left the house, nor that if either of these scenarios did exist they were actions deliberately taken on the part of the respondent with the intention of defeating or delaying her creditors. There is no closing of doors or putting up of shutters or blinds or things done of that nature alleged to be carried out by the respondent, or before me in evidence. A mere direction to a servant to deny her to her creditors is not an act of bankruptcy unless it is followed up by an actual denial or supported by other circumstances evidencing a beginning to keep house. (See Fisher v Boucher (1831) 09 ER 612).

10. Save for what the respondent is alleged to have said to her daughter upon a process server attending upon her home, there is no other circumstantial evidence as to the respondent beginning to keep house nor evidence as to any intent of the respondent to defeat or delay her creditors in providing such a direction to a young child.

11. The petitioning creditor's debt must be in existence at the date of the act of bankruptcy. I have no evidence before me as to the point at which the debt came into existence but in any event I am of the view that the alleged act of bankruptcy upon which the petition depends is not made out.

12. The act of bankruptcy alleged in the Creditor's Petition is not often used in proceedings but nevertheless I acknowledge that it is provided for in s 40(1)(c)(iv) of the Bankruptcy Act 1966. Evidence upon which I could be satisfied that the debtor has committed an act of bankruptcy pursuant to that section is simply not before me in these proceedings. It follows that the application must be dismissed. The orders of the Court then will be as follows:

(1) The application is dismissed.

(2) No order as to costs.

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of Hartnett FM

Associate:

Date: