Re Menere, Paul Henry v Donnelly, Max Christopher & Anor [1996] FCA 796

Re Menere, Paul Henry v Donnelly, Max Christopher & Anor [1996] FCA 796

The Local Court consent order setting aside the default judgment was inoperative because the applicant did not file a proper defence before or after the sequestration order, so the judgment remained in force when the sequestration order was made. In any event, non-compliance with the bankruptcy notice remained an available act of bankruptcy even if the judgment had been effectively set aside. The applicant had not shown a reasonably arguable defence because the company said to be the contractor had been dissolved before the contract was entered into, and there was no useful purpose in annulling the sequestration order. The Court was not satisfied that grounds existed to justify annulment...

Jurisdiction
Australia
Judgment Date
05 September 1996
Procedural Posture
Bankruptcy Application to Annul Sequestration Order / Federal Court Judgment on Application Under Bankruptcy Act 1966 (cth) S 153 B
Outcome
Application dismissed with costs.
Legal Topics
['annulment of Sequestration Order' 'bankruptcy Notice' 'act of Bankruptcy' 'default Judgment Set Aside on Conditions' 'personal Liability for Contracting on Behalf of Non Existent Company']
['bankruptcy' 'corporations Law'] ['annulment of Sequestration Order' 'bankruptcy Notice' 'act of Bankruptcy' 'default Judgment Set Aside on Conditions' 'personal Liability for Contracting on Behalf of Non Existent Company']

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Procedural Posture

Bankruptcy Application to Annul Sequestration Order / Federal Court Judgment on Application Under Bankruptcy Act 1966 (cth) S 153 B

Legal Issues

  1. 1 ['Whether the sequestration order ought not to have been made because the Local Court judgment on which the bankruptcy notice was founded had been set aside by consent before the sequestration order was made.' 'Whether the conditions attached to the Local Court order setting aside the default judgment were fulfilled.' 'Whether non-compliance with the bankruptcy notice remained an available act of bankruptcy notwithstanding any subsequent setting aside of the judgment.' 'Whether the applicant had shown a reasonably arguable defence to the Local Court claim sufficient to justify annulment.']

Ratio Decidendi

The Local Court consent order setting aside the default judgment was inoperative because the applicant did not file a proper defence before or after the sequestration order, so the judgment remained in force when the sequestration order was made. In any event, non-compliance with the bankruptcy notice remained an available act of bankruptcy even if the judgment had been effectively set aside. The applicant had not shown a reasonably arguable defence because the company said to be the contractor had been dissolved before the contract was entered into, and there was no useful purpose in annulling the sequestration order. The Court was not satisfied that grounds existed to justify annulment...

Court Disposition

Application dismissed with costs.

Orders

  • ['The application be dismissed.' 'The applicant pay the costs of the second respondent.']