Australia, Nov. 12 -- The Federal Court of Australia issued the following judgement on Nov. 8:

1 Mr and Ms Anderson (the Andersons), seek to set aside a bankruptcy notice issued on 14 August 2023 by the Respondent (the Council). The bankruptcy notice requires payment of costs orders totalling $344,068.75. Underpinning the notice are costs orders made by the Supreme Court of Victoria and the High Court of Australia. There was no dispute as to the amount or existence of the debt. Instead, the Andersons said that the bankruptcy notice should be set aside on the basis that they have a counterclaim, set-off or cross demand within the meaning of s 40(1)(g) of the Bankruptcy Act 1966 (Cth) (the Act), that equals or exceeds the sum payable under the bankruptcy notice.

2 The proceeding came before me on an application for a review of a decision of a Registrar dismissing the Andersons' application. The application for review was made pursuant to s 35A(5) of the Federal Court of Australia Act 1976 (Cth). It was therefore a hearing de novo, with the matter being considered afresh on the evidence and law at the time of the review: Mazukov v University of Tasmania [2004] FCAFC 159 at [22]-[24] (Kiefel, Weinberg and Stone JJ); Bechara v Bates (2021) 286 FCR 166; [2021] FCAFC 34 at [17] (Allsop CJ, Markovic and Colvin JJ).

3 The Andersons also sought, to the extent necessary, an order under s 41(6A) of the Act, extending time for compliance with the bankruptcy notice to a date to be fixed. That relief was granted by Snaden J on 5 April 2024, when his Honour ordered that:

To the extent that it is not already extended by operation of s 41(7) of the Bankruptcy Act 1966 (Cth), the time for compliance with Bankruptcy Notice 261232 be extended under s 41(6A) until 4pm on the day seven days after the court determines the applicants' application for review of the orders made herein by Registrar Ellis on 22 March 2024.

4 The application was heard on 30 October 2024, following two applications made by the Andersons to have the hearing adjourned, namely:

(a) an application dated 15 October 2024, which was dismissed on 18 October 2024, for reasons given on the transcript; and

(b) an oral application made by counsel for the Andersons at the commencement of the hearing on 30 October 2024, which was also refused for reasons given on the transcript.

5 The Andersons relied on affidavits of Ms Anderson dated 2 July 2024, and dated 14 October 2024. The Andersons also tendered a copy of a generally endorsed writ filed in the Supreme Court of Victoria on 20 January 2024. That writ names the Council as the sole defendant, but has not been served on the Council.

6 The Council relied on an affidavit of Annaliese Battista, a Director of Planning & Place at the Council, dated 2 August 2024.

7 Both parties filed and relied on written submissions. No witnesses were required for cross-examination.

BACKGROUND

8 The Andersons are the registered proprietors of the land at 21 William St, South Yarra, Victoria (the Property), which they purchased on 26 April 2012. The Property, and the laneway next to it, has been the source of a great deal of litigation between the parties. It is necessary to explain that litigation and the events surrounding it in order to understand the Andersons' claim under s 40(1)(g) of the Act.

*Rest of the document and Footnotes can be viewed at: (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2024/2024fca1288)

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