News Limited, in the matter of Ormond v Ormond [2001] FCA 1118

News Limited, in the matter of Ormond v Ormond [2001] FCA 1118

The purported deed of arrangement disclosed on its face that it was not executed by the debtor and trustee within 21 days of the creditors' special resolution as required by s 216(1) of the Bankruptcy Act 1966 (Cth). The Dawson rule that a Pt X deed is treated as valid until declared void under s 222 applies only to a deed valid on its face and did not apply to this document. The debtor therefore could not rely on s 233(2)(a) to defeat the creditor's petition. As the debtor conceded the relevant act of bankruptcy and the Court was satisfied of the matters required by s 52(1), a sequestration order was made. The debtor's separate application failed after leave to use his affidavit was...

Jurisdiction
Australia
Judgment Date
15 August 2001
Procedural Posture
Bankruptcy Creditor's Petition and Debtor's Application Concerning Purported Deed of Arrangement Under Pt X of the Bankruptcy Act 1966 (cth) / Hearing and Judgment on Creditor's Petition and Debtor's Application
Outcome
Creditor's petition granted; debtor's application dismissed; sequestration order made against the debtor's estate; debtor ordered to pay News Limited's costs in both proceedings.
Legal Topics
["creditor's Petition" 'sequestration Order' 'act of Bankruptcy' 'deed of Arrangement' 'bankruptcy Act 1966 (cth) Pt X' 'validity of Deed on Its Face' 'execution of Deed Within Statutory Time' 'costs']
['bankruptcy'] ["creditor's Petition" 'sequestration Order' 'act of Bankruptcy' 'deed of Arrangement' 'bankruptcy Act 1966 (cth) Pt X' 'validity of Deed on Its Face' 'execution of Deed Within Statutory Time' 'costs']

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Procedural Posture

Bankruptcy Creditor's Petition and Debtor's Application Concerning Purported Deed of Arrangement Under Pt X of the Bankruptcy Act 1966 (cth) / Hearing and Judgment on Creditor's Petition and Debtor's Application

Legal Issues

  1. 1 ["Whether the debtor's signing of an authority under s 188 of the Bankruptcy Act 1966 (Cth) was an act of bankruptcy under s 40(1)(i)." 'Whether the Court was satisfied of the matters required by s 52(1) of the Bankruptcy Act 1966 (Cth) for making a sequestration order.' "Whether a purported deed of arrangement made after presentation of the creditor's petition prevented News Limited from proceeding with the petition under s 233(2)(a) of the Bankruptcy Act 1966 (Cth)." 'Whether a purported deed of arrangement not executed within the time required by s 216(1) of the Bankruptcy Act 1966 (Cth) was invalid on its face and therefore not to be treated as valid until declared void under s 222.' 'Whether Re Dawson; Ex parte Dawson and Arthur Andersen and Co, Re Lawrence; Ex parte Burns, Burns v Lorac Mining Pty Ltd, Re Gagliardi; Ex parte Mount, and Musolino v Sidiropoulos affected the treatment of the purported deed.']

Ratio Decidendi

The purported deed of arrangement disclosed on its face that it was not executed by the debtor and trustee within 21 days of the creditors' special resolution as required by s 216(1) of the Bankruptcy Act 1966 (Cth). The Dawson rule that a Pt X deed is treated as valid until declared void under s 222 applies only to a deed valid on its face and did not apply to this document. The debtor therefore could not rely on s 233(2)(a) to defeat the creditor's petition. As the debtor conceded the relevant act of bankruptcy and the Court was satisfied of the matters required by s 52(1), a sequestration order was made. The debtor's separate application failed after leave to use his affidavit was...

Court Disposition

Creditor's petition granted; debtor's application dismissed; sequestration order made against the debtor's estate; debtor ordered to pay News Limited's costs in both proceedings.

Orders

  • ["In N 7250 of 2001, a sequestration order be made against the respondent's estate." "In N 7250 of 2001, the respondent pay the applicant's costs of the proceeding, those costs to be taxed and paid in accordance with the Bankruptcy Act 1966 (Cth)." 'In N 7346 of 2001, the application be dismissed.' "In N 7346 of...