Registrar of the Supreme Court of Norfolk Island v Walsh [2020] FCCA 1962 (20 July 2020)

Last Updated: 30 July 2020

FEDERAL CIRCUIT COURT OF AUSTRALIA

REGISTRAR OF THE SUPREME COURT OF NORFOLK ISLAND v WALSH

[2020] FCCA 1962

Catchwords: BANKRUPTCY – Creditor’s petition – application for a sequestration order – where respondent failed to engage with the Court – where no evidence to establish that the respondent is able to pay debts – where no evidence adduced as to why there is other sufficient cause why a sequestration order ought not to be made sequestration order made.

Legislation: Bankruptcy Act 1966 (Cth), ss.27, 43, 52 Federal Circuit Court (Bankruptcy) Rules 2016

Applicant:

REGISTRAR OF THE SUPREME COURT OF NORFOLK ISLAND

Respondent:

JOHN WALSH

File Number:

SYG 395 of 2020

Judgment of:

Judge Street

Hearing date:

20 July 2020

Date of Last Submission:

20 July 2020

Delivered at:

Sydney

Delivered on:

20 July 2020

REPRESENTATION

Counsel for the Applicant:

Mr D Edney

Solicitors for the Applicant:

Sparke Helmore

No appearance by or on behalf of the respondent

ORDERS

(1) Pursuant to r 13.03C(1)(e) of the Federal Circuit Court Rules 2001 (Cth), the substantive hearing will proceed.

(2) A sequestration order is made against the estate of John Walsh.

(3) The Petitioning Creditor’s costs be paid out of the bankrupt estate in accordance with the priority to which it is entitled in the sum of $7,799.60.

NOTES

(1) The act of bankruptcy occurred on 24 January 2020.

(2) A consent to act as joint trustees has been filed by Fabian Kane Micheletto and Michael Carrafa.

DATE OF ORDER: 20 July 2020

FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY

SYG 395 of 2020

REGISTRAR OF THE SUPREME COURT OF NORFOLK ISLAND

Applicant

And

JOHN WALSH

Respondent

REASONS FOR JUDGMENT

1. These are proceedings within the Court’s jurisdiction, under s 27 of the Bankruptcy Act 1966 (Cth) (“the Act”), in which the petitioning creditor is seeking a sequestration order against the respondent.
2. The respondent is a former legal practitioner who was removed from the roll. In that regard, an order was made for costs against the former practitioner. The former practitioner has failed to pay those costs. That is, no doubt, a relevant factor that will be taken into account in respect of the fitness of the applicant in respect of any future application to be readmitted after the expiry of the 10 years.
3. It is a materially relevant consideration that a former practitioner has not engaged in this Court’s process by way of seeking to appear or participate in a hearing where it is apparent that the respondent debtor has been given proper notice of today’s hearing. The Court is satisfied that service of the bankruptcy petition has occurred and that an act of bankruptcy as a result of the substituted service orders made by the Registrar occurred on 24 January 2020.
4. There is also evidence in establishing service of the creditor’s petition, and these proceedings were, relevantly, commenced prior to the Coronavirus Economic Response Package Omnibus Act 2020 (Cth), as identified in s 2 in respect of Sch 12, that increased the amount required for the making of a sequestration order.
5. The Court is satisfied that the act of bankruptcy occurred at a time that the respondent was personally resident or ordinarily resident in Australia. The Court is satisfied that the requirements of s 43(1) of the Act are made out. The Court is satisfied that the petitioning creditor has established proof of the matters required under s 52 of the Act, and the Court is satisfied that the petitioning creditor has complied with the Federal Circuit Court (Bankruptcy) Rules 2016 in relation to seeking the sequestration order.
6. The respondent was telephoned by the Court on the day of today’s hearing. There was ample evidence of the notification of the hearing to the respondent. A person answered the phone saying, “John Walsh’s telephone.” That person, the Court finds, was, in fact, John Walsh. The person refused to identify themselves, and, despite the Court identifying itself and that the proceedings that were before the Court, the person asserted that he was a judge and gets many bogus calls and would report the call to Telstra and the police, and the person then disconnected the telephone. The Court endeavoured to contact the respondent by telephone again, and the respondent declined to answer telephone.
7. The Court is satisfied that it was, in fact, the respondent that answered the telephone. The false assertion of being a judge, the answering of the call as being John Walsh’s telephone and the refusal to identify himself support the finding made that it was the respondent who answered the call and who refused to participate in the hearing. The Court is also satisfied that the respondent has been given proper notice of today’s hearing date. Independently of that finding as to the identity of the person who answered the telephone, the Court is satisfied this is an appropriate matter in which to make orders for the hearing of the sequestration order to proceed. There has been no engagement by the respondent in the Court process and no basis has been identified that would warrant an adjournment in the interests of the administration of justice.
8. A former legal practitioner who engages in conduct by disregarding court orders for the payment of costs arising from disciplinary proceedings and who fails to engage in Court enforcement proceedings and who takes the course of not participating in a hearing when given an opportunity to do so, in respect of the seeking of a sequestration order, and the seriously improper false assertion of being a judge, are all conduct by the respondent relevant to the fitness of that person in any readmission application. It is not, however, necessary for this Court to express any further views as to the conduct of the respondent in that regard, other than to have identified the concerns as recorded above.
9. The Court is satisfied that this is a matter in which the applicant has established the grounds for the making of a sequestration order.
10. There is no evidence to establish that the respondent is able to pay his debts, and no evidence has been adduced as to why there is other sufficient cause why a sequestration order ought not to be made.
11. The Court has taken into account the purposes behind more recent legislation which has no actually application to this case and has also taken into account the current environment, however given the absence of engagement by the respondent in the proceedings, and the establishment by the applicant of the criteria for the making of a sequestration order, the Court is satisfied that a sequestration order should be made.

I certify that the preceding eleven (11) paragraphs are a true copy of the transcript of the published oral reasons for judgment of Judge Street delivered in open Court on 20 July 2020 and the parties were sent a sealed copy of the Court’s orders.

Associate:

Date: 30 July 2020