Hedditch, Noel Wynyard Ex Parte Dunn, Robert George & Anor [1984] FCA 296

Hedditch, Noel Wynyard Ex Parte Dunn, Robert George & Anor [1984] FCA 296

The respondent received the payments in good faith and for valuable consideration, after requests for repayment and without knowledge or substantial grounds for suspicion of the debtor's insolvency, but she failed to establish that the payments were made in the ordinary course of business. The payments were unusual, made within two months before the deed of assignment, after no earlier repayments despite repeated requests, and at a time when the debtor was hopelessly insolvent. They were therefore void as against the trustee as preferences under s.122 of the Bankruptcy Act 1966.

Jurisdiction
Australia
Judgment Date
26 September 1984
Procedural Posture
Bankruptcy Application by Trustee for Declarations and Orders Concerning Payments Made by the Debtor Before Execution of a Deed of Assignment / Reasons for Judgment and Orders
Outcome
Application upheld under s.122 of the Bankruptcy Act 1966; the three payments were declared void against the trustee as preferences, and repayment with interest and costs was ordered.
Legal Topics
['void Preferences' 'settlements' 'good Faith and Valuable Consideration' 'ordinary Course of Business' 'trustee Under Deed of Assignment']
['bankruptcy' 'insolvency'] ['void Preferences' 'settlements' 'good Faith and Valuable Consideration' 'ordinary Course of Business' 'trustee Under Deed of Assignment']

Case Brief

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Procedural Posture

Bankruptcy Application by Trustee for Declarations and Orders Concerning Payments Made by the Debtor Before Execution of a Deed of Assignment / Reasons for Judgment and Orders

Legal Issues

  1. 1 ['Whether three payments by the debtor to the respondent were void against the trustee as settlements under s.120 of the Bankruptcy Act 1966.' 'Whether the payments were void against the trustee as preferences under s.122 of the Bankruptcy Act 1966.' 'Whether the respondent was a payee in good faith and for valuable consideration and whether the payments were made in the ordinary course of business.' "Whether any order should be made concerning the respondent's interest in 4 Beatty Street, Southport, Queensland."]

Ratio Decidendi

The respondent received the payments in good faith and for valuable consideration, after requests for repayment and without knowledge or substantial grounds for suspicion of the debtor's insolvency, but she failed to establish that the payments were made in the ordinary course of business. The payments were unusual, made within two months before the deed of assignment, after no earlier repayments despite repeated requests, and at a time when the debtor was hopelessly insolvent. They were therefore void as against the trustee as preferences under s.122 of the Bankruptcy Act 1966.

Court Disposition

Application upheld under s.122 of the Bankruptcy Act 1966; the three payments were declared void against the trustee as preferences, and repayment with interest and costs was ordered.

Orders

  • ['The Court declares that Noel Wynyard Hedditch paid $77,734.68 to the respondent by cheque number 785757 dated 9 August 1982, drawn on the account of E.S. Hedditch with the Bank of New South Wales on or about 9 August 1982.' 'The Court declares that Noel Wynyard Hedditch paid $29,171.03 to the respondent by cheque...