Wu v Li (No 2) [2017] FCA 501

Wu v Li (No 2) [2017] FCA 501

The creditor was substantively responsible for all costs and expenses incurred after 6 October 2016, including the trustees' costs and remuneration, because after the petition had lapsed and after the issue was identified, the creditor deliberately pursued the risky course of seeking a retrospective slip-rule extension despite Full Court authority making the position clear. Mr Wu had successfully argued that he should not have been made bankrupt on a lapsed petition, and requiring him to pay trustees' remuneration would not be just or calculated to protect the trustees given his financial position. The costs incurred by both parties up to 6 October 2016 were wasted because the trial judge...

Jurisdiction
Australia
Judgment Date
28 April 2017
Procedural Posture
Appeal in Bankruptcy Proceedings Concerning a Creditor's Petition, Sequestration Order, Costs and Trustee Remuneration / Post Appeal Determination of Costs, Costs Certificates and Trustees' Remuneration After the Appeal Was Allowed
Outcome
Orders made by the Federal Circuit Court on 4 November 2016 were further varied; costs certificates were granted to both parties; the respondent was ordered to pay the trustees' fair and reasonable remuneration and expenses and the appellant's costs.
Legal Topics
["creditor's Petition" 'lapsed Petition' 'sequestration Order' 'slip Rule' 'appellate Powers' "trustees' Remuneration and Expenses" 'costs Certificates']
['bankruptcy' 'civil Procedure' 'costs'] ["creditor's Petition" 'lapsed Petition' 'sequestration Order' 'slip Rule' 'appellate Powers' "trustees' Remuneration and Expenses" 'costs Certificates']

Case Brief

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Procedural Posture

Appeal in Bankruptcy Proceedings Concerning a Creditor's Petition, Sequestration Order, Costs and Trustee Remuneration / Post Appeal Determination of Costs, Costs Certificates and Trustees' Remuneration After the Appeal Was Allowed

Legal Issues

  1. 1 ["What orders should be made for the costs of the appeal and the proceedings below after the creditor's petition had lapsed." "In what proportions the parties should bear the trustees' claimed costs and remuneration incurred in administering the appellant's estate under the sequestration order." 'Whether costs certificates should be granted under s 10(2) of the Federal Proceedings (Costs) Act 1981 (Cth).']

Ratio Decidendi

The creditor was substantively responsible for all costs and expenses incurred after 6 October 2016, including the trustees' costs and remuneration, because after the petition had lapsed and after the issue was identified, the creditor deliberately pursued the risky course of seeking a retrospective slip-rule extension despite Full Court authority making the position clear. Mr Wu had successfully argued that he should not have been made bankrupt on a lapsed petition, and requiring him to pay trustees' remuneration would not be just or calculated to protect the trustees given his financial position. The costs incurred by both parties up to 6 October 2016 were wasted because the trial judge...

Court Disposition

Orders made by the Federal Circuit Court on 4 November 2016 were further varied; costs certificates were granted to both parties; the respondent was ordered to pay the trustees' fair and reasonable remuneration and expenses and the appellant's costs.

Orders

  • ["The orders made by the Federal Circuit Court on 4 November 2016 be further varied by substituting orders noting that the proceedings lapsed pursuant to s 52(4) of the Bankruptcy Act 1966 (Cth) on 6 October 2016, ordering the applicant to pay the respondent's costs incurred after 6 October 2016, and otherwise...