Rasevi Pty Limited v Udowenko, in the matter of Udowenko [2003] FCA 95 (7 February 2003)

Last Updated: 25 February 2003

FEDERAL COURT OF AUSTRALIA

Rasevi Pty Limited v Udowenko, in the matter of Udowenko [2003] FCA 95

IN THE MATTER OF WOLODYMYR UDOWENKO, MICHAEL UDOWENKO AND HELEN UDOWENKO

RASEVI PTY LIMITED (ACN 002 579 286) v WOLODYMYR UDOWENKO, MICHAEL UDOWENKO AND HELEN UDOWENKO

N 7060 OF 2002

LINDGREN J

7 FEBRUARY 2003

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 7060 OF 2002

IN THE MATTER OF WOLODYMYR UDOWENKO, MICHAEL UDOWENKO AND HELEN UDOWENKO

BETWEEN:	RASEVI PTY LIMITED (ACN 002 579 286) APPLICANT
AND:	WOLODYMYR UDOWENKO, MICHAEL UDOWENKO AND HELEN UDOWENKO RESPONDENTS
JUDGE:	LINDGREN J
DATE OF ORDER:	7 FEBRUARY 2003
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The motion brought by notice of motion filed on 10 December 2002 be dismissed.

2. Michael Udowenko and Helen Udowenko pay the costs of Rasevi Pty Limited of that motion.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 7060 OF 2002

BETWEEN:	RASEVI PTY LIMITED (ACN 002 579 286) APPLICANT
AND:	WOLODYMYR UDOWENKO, MICHAEL UDOWENKO AND HELEN UDOWENKO RESPONDENTS

JUDGE:	LINDGREN J
DATE:	7 FEBRUARY 2003
PLACE:	SYDNEY

REASONS FOR JUDGMENT

INTRODUCTION

1 On 23 July 2002 Registrar Hedge ordered that sequestration orders be made against the estates of Michael Udowenko and Helen Udowenko, who are, respectively, the second-named and third-named respondents. I will refer to them as Mr and Mrs Udowenko. They have two sons to whom I will also refer. One of them is Wolodymyr Udowenko ("Wolodymyr") who, as can be seen from the headings of the proceeding, is the first-named respondent. The other son is Valentyn Udowenko ("Valentyn"), who is not a party to this proceeding.

2 By a notice of motion filed on 15 August 2002, application was made for an order that Registrar Hedge's orders made on 23 July 2002 "be struck out". The notice of motion did not make it clear who the moving parties were, but they must have been Mr and Mrs Udowenko since the sequestration orders were made by Registrar Hedge against them alone. In fact, while the second order made on 23 July 2002 was that the costs of the applicant creditor ("Rasevi") be paid from the estates of the "respondent debtors" in accordance with the Bankruptcy Act 1966 (Cth), the third "order" was "No order in respect of Wolodymyr Udowenko as petition not served". This also made it clear that the first and second orders were made against Mr and Mrs Udowenko alone and that they were the appropriate persons to apply to have the orders set aside.

3 The act of bankruptcy was non-compliance on 24 December 2001 with a bankruptcy notice served by Rasevi.

4 Mr and Mrs Udowenko's motion came before Moore J on 12 November 2002, but, there being no appearance on their behalf, his Honour dismissed the motion pursuant to O 10 r 3 of the Federal Court Rules, and ordered the respondents to pay the applicant's costs. I think the reference to "the respondents" in the costs order must also be understood as a reference to Mr and Mrs Udowenko, and not to Wolodymyr, for the reason mentioned, that is, that Mr and Mrs Udowenko alone should be treated as having been the subject of Registrar Hedge's first and second orders and the moving parties on the motion which was before Moore J.

5 By a notice of motion filed on 10 December 2002, application was made for an order "that the reasons for judgment and orders made by Moore J on 12 November 2002 be set aside". Another order was also sought, namely, that "the proceedings be adjourned until the outcome of the appeal to Legal Aid be determined and Legal Representation be provided to the Applicant". The appeal to the Legal Aid Commission was determined adversely to Mr and Mrs Udowenko. On Wednesday 5 February 2003 I heard the motion for an order setting aside the orders of Moore J.

THE PRESENT HEARING

6 Mr Udowenko appeared before me unrepresented. He was, however, aided by an interpreter. He is aged in his eighties. With leave, his son Wolodymyr sat at the bar table with him. The other and second moving party on the motion, Mrs Udowenko, had notified the Court that she did not intend to attend the hearing because of ill health. Mr Udowenko was anxious that the hearing should proceed before me and Mrs Udowenko had not sought an adjournment of it.

7 Mr Udowenko relied on the following affidavits:

* Affidavit of Wolodymyr Udowenko sworn 15 August 2002

* Affidavit of Wolodymyr Udowenko sworn 27 August 2002

* Affidavit of Wolodymyr Udowenko sworn 10 December 2002

* Affidavit of Mr and Mrs Udowenko sworn 22 January 2003

8 Rasevi's final judgment or order, on which the bankruptcy notice was based, was one against Mr and Mrs Udowenko and Wolodymyr in proceeding S 3483 of 1991 in the Equity Division of the Supreme Court of New South Wales. That proceeding concerned a dispute over a horse breeding venture.

9 I have read the following judgments touching the dispute:

* Judgment of Bryson J in the Supreme Court of New South Wales, Equity Division in proceeding S 3483/91, dated 12 March 1992

* Judgment of Mahoney JA in the Supreme Court of New South Wales, Court of Appeal in proceeding CA 40242/92, dated 9 November 1992

* Judgment of Bryson J in the Supreme Court of New South Wales, Equity Division in proceeding 3483/91, dated 10 December 1992

* Judgment of Waddell CJ in the Supreme Court of New South Wales, Equity Division in proceeding 3483/91, dated 15 April 1993

* Judgment of the Supreme Court of New South Wales, Court of Appeal (Clarke JA, Simos AJA and Abadee AJA) on the application for adjournment in proceedings CA 40242/92 and EQ 3483/91, dated 3 September 1996

* Judgment of the Supreme Court of New South Wales, Court of Appeal (Clarke JA, Simos AJA and Abadee AJA) on the appeal in proceedings CA 40242/92 and EQ 3483/91, dated 3 September 1996.

REASONING

10 On the hearing before me, Mr Udowenko made two main points: first, that the judgment obtained by the judgment creditor in the Equity Division of the Supreme Court of New South Wales should be inquired into and had in fact been fraudulently obtained; secondly, that the bankruptcy notice had not been served on Mr and Mrs Udowenko.

11 I have considered carefully the judgments in the Supreme Court proceeding which are related to the first of these issues. Apparently Mr and Mrs Udowenko are the owners of a property called "Windarra" in the Hunter Valley. The Supreme Court proceeding related to a horse breeding venture between one or more of the Udowenkos and either Rasevi or its then principal, since deceased, Mr Jones. Mr and Mrs Udowenko complained that they had had nothing to do with Mr Jones or Rasevi and that any arrangement with him or that company had been with Wolodymyr, not themselves. They also contended that Mr Alan Mitchell, solicitor, who had appeared before Bryson J in the Supreme Court proceeding, had been instructed by Wolodymyr, and had not been authorised to represent them.

12 This issue of whether Mr and Mrs Udowenko were implicated in the dealings with Mr Jones and his company, Rasevi, was examined thoroughly and at length in the Equity Division and in the Court of Appeal and I do not think it should be reopened. Mr and Mrs Udowenko relied on a written statement by one police officer as to the view he held at the time of the testimony which Mr Jones gave before Bryson J in the Equity Division proceeding, but apparently his view was not shared by the authorities. Bryson J alluded to problems or alleged problems in the testimony of Mr Jones and of Wolodymyr, as did the Court of Appeal. Bryson J found Mr Jones the more credible witness. The Court of Appeal saw no reason to disturb his Honour's assessment of the evidence. No sufficient cause is shown to go behind the judgment.

13 In relation to service of the bankruptcy notice, Mr Udowenko stated in an unsworn statement which was annexed to one of Wolodymyr's affidavits that the bankruptcy notice had not been served on him. I permitted Mr Udowenko to go into the witness box to adopt under oath that unsworn statement. He denied having ever been served with any documents relating to Rasevi. Mr Udowenko's testimony prompted counsel for Rasevi to read the affidavit of service of the bankruptcy notice. This was an affidavit by Mr Adrian Hogan of Newcastle, a licensed commercial sub-agent.

14 I asked Mr Udowenko whether he wished to cross-examine Mr Hogan. Although his answers were not clear on this point, I thought I should treat him as indicating that he did wish to ask Mr Hogan some questions. Accordingly, arrangements were made for Mr Hogan to be available for cross-examination by telephone. I asked Mr Hogan a number of questions designed to probe his recollection as to the circumstances of service of the bankruptcy notice which his affidavit of service said had occurred on 17 November 2001. He described the Windarra property at Gresford Road, Vacy, or, at least, the gate and sign leading into it. He said that when he attended on 17 November 2001, he first had a discussion with Wolodymyr and that the two of them went to the house, where he served Mr and Mrs Udowenko.

15 I asked Mr Hogan to describe Mr and Mrs Udowenko and Wolodymyr and he did so. (Mrs Udowenko had appeared before me on a previous occasion.) His descriptions were consistent with the appearance of the three individuals, subject to one matter - he said that Wolodmyr had a moustache, whereas in Court before me, he did not. I regard this of no consequence. He described Mr and Mrs Udowenko and Wolodymyr in terms of their approximate height and age, which description I thought was reasonably accurate.

16 Following the hearing, Wolodymyr has forwarded to my chambers several documents seeking to supplement the evidence which was before me. I do not propose to admit them into evidence, although I have read them. Generally they are irrelevant to the issues which I have identified as calling for decision. To the extent to which they are relevant, they are not persuasive.

17 It is not irrelevant to mention that, in the Supreme Court proceeding, Mr and Mrs Udowenko denied that they had been served with the summons which was before Bryson J. In that proceeding also, the process server's affidavit was called into question and the process server was cross-examined. Bryson J accepted the process server's testimony.

18 Of course, it is not for that reason that I also accept the process server's testimony in the present case, but it does seem appropriate to record that Mr Udowenko seems to have a propensity for making sweeping denials of having received documents without, as I find, a careful regard to the facts relating to any particular document.

CONCLUSION

19 For the above reasons the motion will be dismissed. The Court orders that:

1. The motion brought by notice of motion filed on 10 December 2002 be dismissed.

2. Michael Udowenko and Helen Udowenko pay the costs of Rasevi Pty Limited of that motion.

I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren.

Associate:

Dated: 25 February 2003

Michael Udowenko, one of the Applicants on the motion, appeared in person
Helen Udowenko, the other Applicant on the motion, did not appear
Counsel for the Respondent on the motion (Rasevi Pty Limited)	Mr R D Marshall
Solicitor for the Respondent on the motion (Rasevi Pty Limited)	Nash Allan Williams & Wotton
Date of Hearing:	5 February 2003
Date of Judgment:	7 February 2003