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McElligott v McElligott QCATA 39
McElligott v McElligott as Executor of the estate of Joyce Alice McElligott  QCATA 39
Lorain Ronda McElligott
Adrian McElligott as Executor of the estate of Joyce Alice McElligott
On the papers
Justice D Thomas, President
20 March 2015
The application for leave to appeal or appeal is struck out.
APPEAL – LEAVE TO APPEAL – MINOR CIVIL DISPUTE – whether grounds for leave to appeal
Bankruptcy Act 1966 (Cth) ss 58, 59A, 60(4)(a), 134(j), 178
Family Law Act 1975 (Cth)
Queensland Civil and Administrative Tribunal Act 2009 (Qld) ss 143(3), 143(5)(c)
Bryant v Commonwealth Bank of Australia (1997) 75 FCR 545
Cox v Journeaux (No 2) (1935) 52 CLR 713
Cummings v Claremont Petroleum 1996) 185 CLR 124
McElligott v Public Trustee of Queensland & Ors  QSC 314
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).
REASONS FOR DECISION
- Ms Lorain McElligott and Mr Adrian McElligott are brother and sister. Mr McElligott is the executor of their mother’s estate. Ms McElligott filed an application for minor debt against Mr McElligott, claiming reimbursement of expenses relating to the estate.
- Mr McElligott filed an application to strike out Ms McElligott’s claim. He submitted that, because Ms McElligott was an undischarged bankrupt, she had no standing to bring a claim. He also submitted that the tribunal had no jurisdiction to hear her claim. A Magistrate, sitting in the minor civil disputes jurisdiction, accepted Mr McElligott’s submission and struck out the claim.
- Ms McElligott filed an application for leave to appeal or appeal. Once again, Mr McElligott filed an application to strike out the claim. In addition to the two grounds argued before the learned Magistrate, Mr McElligott submits that Ms McElligott’s application for leave to appeal has been filed out of time.
- Ms McElligott has filed a great deal of material to support her application for leave to appeal. The material includes transcripts of conversations she had with Mr McElligott and their sister Cheryl which, she says, shows threats and abuse by Mr McElligott towards her. The material includes historical material, relating to Ms McElligott’s perception of Mr McElligott’s administration of the estate. Because the issue before me is limited to a question of law, I do not propose to deal with that material in these reasons.
Is the application filed out of time?
- The learned Magistrate gave his decision on 22 April 2014. Ms McElligott filed her application, after three previous attempts, on 22 August 2014.
- Ms McElligott submits she requested a copy of the reasons for decision on 24 April 2014, within time, but did not receive them until 3 July 2014. She therefore submits that her application for leave to appeal was filed within time.
- There is an anomaly in her submissions. She says that she received a copy of the transcript for the hearing on 16 May 2014. The transcript contains the reasons for decision. If Ms McElligott did receive a copy of the transcript on 16 May 2014, then her application for leave to appeal is out of time.
Does Ms McElligott have standing to file the application?
- Ms McElligott is an undischarged bankrupt. Under s 58 of the Bankruptcy Act 1966 (Cth) (“Bankruptcy Act”), the Official Trustee in Bankruptcy became the owner of any property Ms McElligott owned at the date of bankruptcy. The Official Trustee took the view that Ms McElligott’s application is for claims that are property within the bankrupt estate and, therefore, Ms McElligott has no standing to bring her application. Mr McElligott submits the same logic should apply to the application for leave to appeal.
- Ms McElligott submits that not all property vests in the Official Trustee. She says that the Bankruptcy Act defines “property of the bankrupt” as “property divisible amongst the creditors”. She submits that this definition does not extend to all or every property right of the bankrupt and she cites some examples.
- The High Court has held that a judgment debtor’s right to appeal is not a “property right”. Instead, the High Court found that the right to file an appeal fell within s 134(j) of the Bankruptcy Act: – to bring, institute or defend any action or other legal proceeding relating to the administration of the estate.
- The Official Trustee did not appeal the learned Magistrate’s decision. The High Court concluded that, because the right to an appeal is not a property right, the appropriate course for a bankrupt is to apply for an order under s 178 of the Bankruptcy Act to a Court that has jurisdiction in bankruptcy for an order.
- Ms McElligott did not exercise her rights under s 178. She has no right to file an appeal. The appeal should, therefore, be struck out.
- For completeness, I will consider whether the learned Magistrate could consider Ms McElligott’s original claim.
- I agree that Centrelink payments are not property rights. Ms McElligott refers to family payments without definition. If she is referring to payments pursuant to orders under the Family Law Act 1975 (Cth), then the Bankruptcy Act operates subject to those orders. If she is referring to payments between family members, then I do not necessarily agree. It would be necessary to examine the character of the payment, or the right to payment.
- Rights relating to refunds or reimbursement of expenses are in the nature of a claim for a debt. Some of Ms McElligott’s claim relates to amounts she paid on behalf of her mother. That does not change the character of the claim. The amount claimed is a debt and, therefore, a property right that vests in the Official Trustee.
- Ms McElligott now claims that some payments were made on behalf of her children, who were minors at the time. I have examined Ms McElligott’s original claim. There is no suggestion that she was claiming any amounts as agent, or trustee, for her children.
- Ms McElligott suggests that she made those payments on behalf of her children so that they could receive the “gift” of her mother’s house, pursuant to clause 16 of her mother’s will. Philip McMurdo J has determined that clause 16 of the will confers a personal right, not an equitable right to live in the house. Ms McElligott’s decision to pay the house insurance may have benefited the estate, but that was her personal decision and the character of the claim does not change.
- Ms McElligott says that the claim for $5,000 to clean up her mother’s house is a claim for wages. She submits that wages are not a property right. In support of this submission, Ms McElligott refers the appeal tribunal to the fact that she is not required to make income contributions to the Official Trustee until her income reaches a certain threshold.
- Part VI, Division 4B, Subdivision D of the Bankruptcy Act deals with a bankrupt’s contributions. The rationale is to require a bankrupt to surrender income in excess of a pre-determined level to the Official Trustee in reduction of the bankrupt’s debts. It does not re-categorise a claim for unpaid wages from a property right that vests in the Official Trustee to a right that vests solely in a bankrupt.
- Section 60(4)(a) of the Bankruptcy Act states that a bankrupt can bring an action for a “personal injury or wrong done to the bankrupt”. Ms McElligott submits that her claim falls within this definition.
- It is clear that the nature of the appeal is determined by the nature of the proceeding from which the appeal comes.
- The test of whether an action falls within s 60(4)(a) is whether the damages or part of them are to be estimated by immediate reference to pain felt by the bankrupt in respect of the person’s mind, body or character and without reference to the person’s rights of property. The application of s 60(4)(a) was considered further in Bryant v Commonwealth Bank of Australia. The High Court said:
But if the injury that was suffered or the wrong done arose as a direct result of the alleged infringements of his financial or property rights, as was the case in Faulkner v Bluett, then "the primary and substantial right of action is direct pecuniary loss to the property or estate of the bankrupt".
- Ms McElligott’s claims are based on an alleged infringement of her financial or property rights. She does not assert a right to compensation through a physical or mental injury. Her claim is not within the exemption provided by s 60(4)(a) of the Bankruptcy Act. The right of action lies with the Official Trustee and Ms McElligott has no standing.
- If Ms McElligott’s claims are truly for reimbursement of money she paid on behalf of the estate, then they do fall within the definition of minor debt and the tribunal does have jurisdiction.
- Mr McElligott submits that Ms McElligott is “forum shopping”. She has filed applications in all Queensland Courts, all of which have been dismissed. If Ms McElligott’s claim was to proceed, and there were proceedings on foot in another Court, I would be inclined to transfer the proceedings to that Court. In any event, it is not a decision I am required to make.
 QCAT Act s 143(3).
 Ibid s 143(5)(c).
 Transcript page 1-14, lines 29 – 44.
 Letter from the Official Trustee to QCAT dated 4 March 2014.
 Cummings v Claremont Petroleum (1996) 185 CLR 124 at 128.
 Ibid 132.
 Bankruptcy Act 1966 (Cth) s 59A.
 McElligott v Public Trustee of Queensland & Ors  QSC 314 at .
 Cox v Journeaux (No 2) (1935) 52 CLR 713 at 721.
  FCA 582 at 564 per O'Loughlin and Merkel JJ.
- Published Case Name:
Lorain Ronda McElligott v Adrian McElligott as Executor of the estate of Joyce Alice McElligott
- Shortened Case Name:
McElligott v McElligott
 QCATA 39
20 Mar 2015