An Albury businessman and racehorse owner has been declared bankrupt in a win for the Commonwealth which says he owes it more than $10 million following a long-running court battle.
The Commonwealth had applied to the Federal Court for a sequestration order against Allan Paul Endresz, whose successful horse Alligator Blood was stripped of its win in this year's $2 million Magic Millions Guineas after testing positive for a prohibited substance.
He opposed the order on a number of grounds, including a submission that the judge could not be satisfied that the debt was still owing.
But Justice Jacqueline Gleeson on Thursday made the order and ruled that the Commonwealth's legal costs of $19,739 be paid from the estate of Mr Endresz.
In its March application, the Commonwealth said Mr Endresz owed it $11,588,824.
This was said to be the balance of a debt order of $18,633,178 made in the ACT Supreme Court in 2014 less $7,044,354 received in part satisfaction of the debt.
"The creditor's petition notes that the Commonwealth holds security over property of Mr Endresz consisting of an equitable charge over real property, leaving an unsecured debt of $10,308,824.42," the judge said.
The Commonwealth in 1999 commenced the ACT proceedings which concerned payments of federal funds to Albury-based company CTC Resources.
The payments were made by David Muir, an employee of a contractor of the Commonwealth, who was subsequently convicted of fraud.
Justice Gleeson said the summary provided by Mr Endresz stated that the judge found the payments were made without parliamentary authority and were therefore illegal and void.
The ACT judge concluded that Mr Endresz, among others, was liable for knowingly assisting in the breaches of fiduciary duty.
Over the years, a number of appeals and other proceedings took place culminating in the bankruptcy application.
Mr Endresz is the managing owner of Alligator Blood, which has notched up 10 wins from 12 starts.
Traces of altrenogest were found in the gelding's urine sample after the Magic Millions race in January. But Racing Queensland's stewards last month found no evidence anyone connected with trainer David Vandyke's stable had administered the prohibited substance and there was no indication how it was administered.
Mr Endresz said he would challenge the decision to disqualify Alligator Blood in the Supreme Court after the winner's $1.1 million prizemoney was forfeited.