Australian Workers' Union v Bowen [1946] HCA 24

Australian Workers' Union v Bowen [1946] HCA 24 - HCA 1946 case summary — Zoe

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does not consent or he objects, the judgment debt is irrecoverable by bankruptey proceedings. The appellants were entitled to use the names of Dalton and Miller in the bankruptcy notice unless these two persons dissented from such use. They did not dissent. In the cir- cumstances, subject to proper indemnities as to costs, the union and _ such other judgment creditors who so desired were entitled to proceed. in the bankruptcy jurisdiction. The appellants took advantage of the first opportunity, namely upon the hearing of the petition to offer an indemnity to Dalton and Miller as to the costs of the bank- Tuptey proceedings. The bankruptcy notice as issued was valid ; its issue was procured in accordance with the Bankruptcy Rules. The application therefor was made by all the judgment creditors and was signed by the solicitor as solicitor for all the judgment creditors. 'The solicitor's retainer in that regard has never at any time been 'questioned, and, presumably, he was properly and lawfully retained. The decree as to costs in the equity suit meant no more than that it was to operate in favour of each and every one of the judgment creditors in so far as each and every one may have incurred costs. The Australian Workers' Union was the only party that incurred any costs and, therefore, was the only party upon which the decree as to costs conferred a right. This right was, inter alia, a right to recover the costs in bankruptcy proceedings. In the circumstances 'it was not necessary that Dalton and Miller should consent to or authorize the taking of bankruptcy proceedings (Re Darby (1) ). There is nothing in the Bankruptcy Act or the Bankruptcy Rules to prevent the appellants from exercising their right, apart from any contractual relationship with the other creditors. The Australian Workers' Union was a sufficient petitioner because it was entitled at law and in equity to the judgment debt: see s. 55 (1) (6), Bank- ruptey Act 1924-1933. It was entitled, in equity, to be reimbursed so much of the costs as it had paid, or, in other words, in equity it alone was entitled to the costs. Alternatively, the appellants are entitled, by reason of the agreement between the parties, to those costs which can be recovered from the debtor. It was not essential in the bankruptcy proceedings that all the joint creditors should be

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account, but the rule which was relied upon plainly refers only to the authority of the secretary to take proceedings with respect to claims -&c. of the union itself and not of members of the union. The judg- _ ment debtor failed to comply with the bankruptcy notice and a peti- tion for sequestration of Bowen's estate was presented in which the petitioners relied upon that failure as an act of bankruptcy. The tition was not signed by either C. A. Dalton or W. J. Miller. _ The decree made in the equity suit ordered that the costs of the _ defendants be taxed and that such costs, when taxed and certified, be paid by the plaintiffs other than a plaintiff described as the New South Wales Branch of the Australian Workers' Union, which was held not to be in existence. The costs were taxed and certified at the sum of £670 19s. 3d. The liability of Bowen and his co-plaintifis under the order for costs was joint and several. In such a case a bankruptcy notice may be issued against one of the joint judgment debtors without including the others and failure to comply with the otice would be an act of bankruptcy on the part of that judg- 'ment debtor: In re Low; Ex parte Gibson (1). The Bankruptcy Act 1924-1933, s. 52 (j), provides that a bankruptcy notice may be issued upon the application of a creditor who has obtained a final _ Judgment. A judgment creditor can issue a bankruptcy notice only if he is in a position to issue execution (Ex parte Woodall; In re ' Woodall (2); Ex parte Ide; In re Ide (3) ). Only one writ a execu- _ tion can be issued for the one judgment ion to which joint judgment creditors are entitled, and a bankruptcy notice in the case of such editors can be effective only when issued by or on behalf of all the Judgment creditors. So also a bankiuptcy petition must be presented y all the joint judgment creditors : Ex parte Owen ; In re Owen (4) ; B and v. Newsome (5) and see Re Tucker; Ex parte Tucker (6). 4 The decision in Re Darby (7) that one of a number of joint judgment ditors was entitled to obtain the issue of a bankruptcy notice in e name of all the creditors cannot be supported as against the authorities to which I have referred. _ The position, therefore, is that the bankruptcy notice was issued hout the authority of two of the judgment creditors and accord- ingly was prima facie invalid. The petition was not signed by or by e authority of the two judgment creditors, C. A. Dalton and . J. Miller. Accordingly the petition was irregular and was prima facie rightly dismissed upon the ground that it was founded upon an invalid bankruptcy notice and upon the further ground that

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_to require Miller and Dalton to lend their names to any proceedings provided by law for the enforcement of the decree for costs, including Ecccecines in bankruptcy. But, except where he has the express or implied authority of the party in whose name he desires to proceed, e person beneficially entitled in the subject of a proceeding must, as a general rule, seek the consent of the nominal party and offer him _a sufficient indemnity against any liability for costs to which the use of his name might expose him. Unless the real actor does this, or unless special circumstances exist excusing him from doing so, the eourts will not permit him to join, or proceed in the names of, nominal parties without their actual authority, express or implied : See Chambers v. Donaldson. (1); Spicer v. Todd (2); Auster v.

Holland (3); Coleman and Davis v. Biedman (4). And as to who may apply to set aside or stay, see Hubbart v. Phillips (5) ; Fricker v. Van Grutten (6). If one of two creditors or claimants desired to put a joint right in suit, he might, upon giving a proper indemnity, be permitted by the common law courts to sue in the name of the other ereditor or claimant as well as his own. But preparedness to afford _a proper indemnity was a condition of his being allowed to proceed. _ in their joint names. It is true that when the person beneficially entitled sued in the name
of the nominal party, or one co-obligee sued in the name of all the _ eo-obligees, the proceedings would not be struck out or stayed once _ a satisfactory indemnity was provided. But it does not appear to me to matter for the purpose in hand whether the condition of giving an indemnity is regarded as strictly precedent or not. It is enough that, speaking generally, it was indispensable. It could not be said that the bankruptcy notice was applied for as required by s. 52 (j) of the Bankruptcy Act 1924-1933 by the persons entitled to enforce the decree for costs, if one or some only of them applied without an authority in law or in fact from all the others which was complete _ and absolute. _ There was, in my opinion, neither express nor implied authority in the Australian Workers' Union or in the solicitor to use the names _ of Miller and Dalton. The suggestion was made that the general _tules of the union, by which the latter were bound as members,
contained a contractual authority to the secretary on the part of 'members to use their individual names in legal proceedings for the

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Judgment (131 paragraphs)