Meehan v Alfaro [1999] FCA 832

Meehan v Alfaro [1999] FCA 832

A Local Court judgment entered upon a costs assessor's certificate issued under s 208J of the Legal Profession Act 1987 (NSW)—even if arising from costs orders made in unconcluded Supreme Court proceedings—is a final judgment for the purposes of Bankruptcy Act 1966 (Cth), s 40(1)(g) and s 40(3)(b). The debtors' non-compliance with the bankruptcy notice founded on such a judgment was therefore an act of bankruptcy. The creditor's alleged intent to frustrate ongoing litigation did not constitute sufficient cause to refuse a sequestration order.

Parties
Applicant: John Meehan; First Respondent: Pedro Alfaro; Second Respondent: Silvia Gladys Alfaro
Jurisdiction
Australia
Judgment Date
25 June 1999
Procedural Posture
Bankruptcy Application for Review of Sequestration Orders / Application for Review of Sequestration Orders; Decision of Katz J Affirming Registrar's Orders
Outcome
Registrar's orders affirmed; sequestration orders made against debtors' estates
Legal Topics
Sequestration Orders, Bankruptcy Notice, Final Judgment, Costs Orders
Bankruptcy Sequestration Orders Bankruptcy Notice Final Judgment Costs Orders

Case Brief

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Parties

John Meehan

Applicant

Pedro Alfaro

First Respondent

Silvia Gladys Alfaro

Second Respondent

Procedural Posture

Bankruptcy Application for Review of Sequestration Orders / Application for Review of Sequestration Orders; Decision of Katz J Affirming Registrar's Orders

Legal Issues

  1. 1 Whether debtors committed an act of bankruptcy by non-compliance with bankruptcy notice
  2. 2 Whether the bankruptcy notice was a nullity because judgment relied on was not final
  3. 3 Whether a judgment of the Local Court founded on orders for costs made in unconcluded Supreme Court proceedings is a final judgment for the purposes of the Act

Ratio Decidendi

A Local Court judgment entered upon a costs assessor's certificate issued under s 208J of the Legal Profession Act 1987 (NSW)—even if arising from costs orders made in unconcluded Supreme Court proceedings—is a final judgment for the purposes of Bankruptcy Act 1966 (Cth), s 40(1)(g) and s 40(3)(b). The debtors' non-compliance with the bankruptcy notice founded on such a judgment was therefore an act of bankruptcy. The creditor's alleged intent to frustrate ongoing litigation did not constitute sufficient cause to refuse a sequestration order.

Court Disposition

Registrar's orders affirmed; sequestration orders made against debtors' estates

Orders

  • The Registrar's orders of 16 February 1999 be affirmed.
  • The petitioning creditor's costs of the review (including reserved costs, if any) be taxed and paid in accordance with the Bankruptcy Act 1966 (Cth).