Beckham v Drake

I hereby certify that this and the preceding twenty-four (24) pages are a true copy of the reasons for judgment herein of the Honourable Justice Lockhart. Associate Dated: 4 July 1997

GENERAL DISTRIBUTION IN THE FEDERAL COURT OF AUSTRALIA) ) NEW SOUTH WALES DISTRICT REGISTRY) NG 168 of 1995 ) GENERAL DIVISION ) ON APPEAL FROM A SINGLE JUDGE OF THE COURT B E T W E E N: JOSEPH RICHARD BRYANT Appellant

• AND - COMMONWEALTH BANK OF AUSTRALIA Respondent JUDGES: LOCKHART, O'LOUGHLIN and MERKEL JJ PLACE: SYDNEY DATE: REASONS FOR JUDGMENT O'LOUGHLIN AND MERKEL JJ BACKGROUND FACTS On 30 August 1994, Mr Joseph Richard Bryant instituted against the Commonwealth Bank of Australia the proceedings the subject of the present appeal. For convenience, we shall refer to the parties to the litigation as Mr Bryant and "the Bank" respectively. The proceedings came to an abrupt end. On 3 March 1995, pursuant to the Bank's application, Sackville J ordered that the proceedings be summarily dismissed and that Mr Bryant pay the Bank's costs. On 22 March 1995 Mr Bryant lodged a notice of appeal against that judgment. The Bank subsequently moved this Court on notice of motion filed on 24 January 1997 for an order that the appeal be dismissed as incompetent: see O 52 r 18(1). Briefly stated, the Bank relies upon the fact that Mr Bryant had become a bankrupt on 30 March 1995. It claims that his trustee in bankruptcy has failed to elect to prosecute Mr Bryant's appeal and is thereby deemed to have abandoned it pursuant to s 60(3) of the Bankruptcy Act 1966 (Cth) ("the Act"). Accordingly, the Bank contends that it is entitled to have the appeal dismissed. It is the Bank's notice of motion that is under consideration in these proceedings. Before embarking upon the substance of the Bank's application, it is necessary to recount, briefly, the history of Mr Bryant's litigation with the Bank and its effect upon him. It commenced when the Bank sought recovery of moneys it lent to Mr Bryant or to one or other of his companies. For present purposes, it is not necessary to distinguish between Mr Bryant as a primary borrower and as a guarantor to the Bank in respect of his companies' debts. The repayment of the moneys due to the Bank had been secured by various mortgages which the Bank sought to enforce by obtaining possession of properties that were the subject of the mortgages. The Bank's claims were heard before Levine J in the New South Wales Supreme Court. On 27 November 1993 judgment was entered in favour of the Bank. Mr Bryant has lodged an appeal in that matter but, for reasons that were not explained, the appeal has not been prosecuted. Whilst the Supreme Court proceedings were still on foot, Mr Bryant instituted proceedings against the Bank in this Court. His application, filed on 11 October 1993, sought orders under the Trade Practices Act 1974 (Cth) varying the contractual arrangements subsisting between himself and the Bank. He also claimed damages in the amount of $20,000,000. On the Bank's application, the Federal Court proceedings were summarily dismissed, Einfeld J holding that the issues raised in Mr Bryant's statement of claim could have been and should have been raised by way of defence and counter-claim in the Supreme Court proceedings: see Bryant v Commonwealth Bank of Australia (1994) 51 FCR 529. On 5 August 1994, Mr Bryant lodged a notice of appeal from the decision of Einfeld J. That appeal was dismissed by a Full Court of this Court on 14 June 1995 and Mr Bryant's application for special leave to appeal to the High Court was refused. As pointed out already he issued the proceedings the subject of the present appeal on 30 August 1994. Meanwhile the Bank had instituted bankruptcy proceedings against Mr Bryant and on 30 March 1995 a sequestration order was made against his estate. An appeal by Mr Bryant against that order was dismissed by a Full Court of this Court on 24 November 1995. The operation of the sequestration order had been stayed pending a determination of Mr Bryant's appeal but that stay was discharged when the Full Court handed down its decision. An application to the High Court by Mr Bryant for special leave to appeal was refused on 3 October 1996. Following upon the High Court's refusal to grant special leave in the bankruptcy proceedings, the Bank served on Mr Bryant's trustee in bankruptcy, a request for an election pursuant to s 60(2) of the Act in respect of the proceedings instituted by him on 30 August 1994. The sub-section provides that:- "[a]n action commenced by a person who subsequently becomes a bankrupt is, upon his becoming a bankrupt, stayed until the trustee makes election, in writing, to prosecute or discontinue the action." The word "action" is defined as "any civil proceeding, whether at law or in equity": s 60(5). That definition means that the filing of a notice of appeal, constituting, as it does, the institution of an originating process, is encapsulated within the phrase "an action commenced": see Cummings v Claremont Petroleum NL (1996) 185 CLR 124 at 130 per Brennan CJ, Gaudron and McHugh JJ and at 142 per Dawson and Toohey JJ. In this case, Mr Bryant filed his notice of appeal on 22 March 1995, eight days before the making of the sequestration order. If the trustee, having been served with a notice of action, does not make an election within twenty eight days thereafter to prosecute or discontinue, he is deemed to have abandoned the action: s 60(3). However, s 60(4) provides that a bankrupt may, in the circumstances there described, continue, in the bankrupt's own name, an action that he or she may have commenced before becoming a bankrupt. The sub-section provides as follows: "(4)Notwithstanding anything contained in this section, a bankrupt may continue, in his or her own name, an action commenced by him or her before he or she became a bankrupt in respect of: (a) any personal injury or wrong done to the bankrupt, his or her spouse or a member of his or her family; or (b) the death of his or her spouse or of a member of his or her family." Having been served by the Bank with a notice of action, the trustee replied by letter dated 1 November 1996 in these terms: "Having referred the request to my legal advisers, I am advised that this is not a proceeding in which I would be required to make an election. The continuation of the proceedings appears to be solely at the discretion of the bankrupt." No further information was available to the Court to explain the decision of the trustee. Nevertheless, it is obvious that the trustee's reply can only be interpreted as a failure to elect. It remains, however, to consider the consequences of that failure. If, as Mr Bryant has submitted, the action commenced by him before he became a bankrupt (i.e. the appeal) is in respect of "any personal injury or wrong" done to Mr Bryant, his spouse or a member of his family he will be free to continue his appeal - no adverse consequence will flow from the trustee's failure to elect. As to this, Mr Bryant has claimed in the course of his written and oral submissions that there has been such personal injury and wrong. He has submitted that by reason of the wrongful conduct of the Bank he has suffered mental deterioration, stress, a breakdown in his family relationships as well as "immense personal damage" to him, his wife, his children and his grandchildren. But if, notwithstanding these submissions, the appeal is in respect of financial or property rights rather than personal injury or wrong, then the failure to elect will, by virtue of the provisions of s 60(3) of the Act be deemed to be an abandonment of the appeal. In that case, it would be appropriate for this Court to make an order dismissing the appeal. THE BANK'S CASE The case for the Bank was presented on two broad fronts. First, it was submitted that the Court should look only at the contents of the notice of appeal without having regard to the causes of action or the relief sought in the application and statement of claim. If however, the Court was of the opinion that it should have regard to those pleadings, then the Bank's alternative argument was that such proceedings were wholly (and if not wholly, then substantially) commercial in nature, dealing with Mr Bryant's property rights. In either event, it was submitted that the action - whether it be the appeal simpliciter or the appeal characterised by reference to the original proceedings - was not one falling within the exceptions that are set out in s 60(4). In other words, the Bank submitted that the proceedings were not "in respect of" personal injury or wrong done to the bankrupt, his spouse or a member of his family. Of course, no question of the death of any person arises. Although the words "in respect of" have been said to have "the widest possible meaning of any expression intended to convey some connection or relation between the two subject-matters to which the words refer: see The Trustees Executors & Agency Co. Ltd v Reilly [1941] VLR 110 at 111 per Mann CJ, the phrase must be construed in the context in which it is found as it is that context which will determine the matters to which it extends: The Workers' Compensation Board of Queensland v Technical Products Pty Ltd (1988) 165 CLR 642, 646-7, 653-4 and Technical Products Pty Ltd v State Government Insurance Office (Queensland) (1989) 167 CLR 45, 47 and 51. The relevant context for present purposes is the scheme under the Act, upon a debtor's bankruptcy, for the debtor's property rights, including choses in action other than those exempted in s 60(4), to vest in the bankrupt's trustee: see ss 58, 60 and 116 and Daemar v Industrial Commission of New South Wales (1988) 12 NSWLR 45 at 50 per Kirby P. In that context we would have thought that it is essential to have regard to the cause or causes of action pleaded and to the relief sought in the original proceedings when considering whether s 60(4) of the Act would entitle a bankrupt to prosecute an appeal. A simple example demonstrates this proposition. A person institutes proceedings, claiming damages for personal injuries that resulted from the alleged negligence of a defendant. Such a claim would obviously attract the provisions of s 60(4) and such a plaintiff would be entitled to continue the action notwithstanding his or her subsequent bankruptcy. But, let it be supposed that because of an adverse ruling as to the admissibility of certain evidence or a plea of issue estoppel, the plaintiff's claim was dismissed. In a literal sense, an appeal against the trial judge's refusal to admit that evidence or accede to the plea might be regarded as a matter relating to an evidentiary or estoppel issue only, having no connection with a "personal injury or wrong done" to the plaintiff. But if the appeal were to succeed and a new trial ordered, the plaintiff's claim for personal injuries would have been revived. A similar situation would arise if the plaintiff's appeal succeeded on any other ground. These examples indicate that in the usual course an appeal will derive its characterisation, for the purposes of s 60(4), from the nature of the proceeding the subject of the appeal and the grounds of appeal and the relief sought in the notice of appeal. MR BRYANT'S "ACTION" The notice of appeal in the present case was prepared by Mr Bryant without the benefit of legal assistance. The appeal was from the whole of the judgment of Sackville J and relied upon fifteen grounds of appeal. None of the grounds touched upon any question of "personal injury or wrong". They were stated as follows:- "Grounds: 2. His Honour in finding that the words "Forwarded to" are the same as "Had been served" was wrong in law. 3. His Honour in finding that in order to grant possession of real property it is necessary to first grant a right of sale is wrong in law. 4. His Honour in finding that a valid notice complying with section 57(2)(b) of the Real Property Act 1900 (NSW) had been forwarded was wrong in law and against the weight of the evidence. 5. His Honour in finding that a party could rely on a patently invalid document is wrong in law. 6. His Honour misdirected himself by adding to or deleting from the pleadings relied on in the Supreme Court proceedings. 7. His Honour finding that The Conveyancing Act 1919 (NSW) was not contravened is wrong at law and against the weight of evidence. 8. His Honour erred at law in finding that the Anshun estoppel applied in proceedings not being a defence. 9. His Honour finding that evidence in one case cannot be used in a completely different case is wrong at law. 10. His Honour erred at law in finding that the appellant's case is essentially a defence of the Supreme Court actions on the mortgages and guarantees. 11. His Honour erred at law in finding that the matters raised in the Federal Court Proceedings could have been raised in the Supreme Court proceedings. 12. His Honour erred at law in finding what the appellant could and could not do, and His Honour ignored or dismissed the fact that the appellant was through no fault of his own unrepresented in both proceedings. 13. As a matter of law it was not open to His Honour to adjudicate that the matters raised in the Federal Court Proceedings could have been raised in the Supreme Court proceedings. 14. His Honour erred at law in finding that there was conflict of a judgement (sic) in favour of the appellant in this court with the judgement in the Supreme Court. 15. His Honour erred at law in finding that a Cross-Claim can form the basis of an Anshun estoppel. 16. His Honour erred at law in finding that the appellant had been warned in the Supreme Court that he would not be able to litigate the other matters in the Federal Court." The main orders sought were that "the orders of Sackville J ... be set aside" and "[a] new trial be allowed". The nature of the proceeding and the causes of action the subject of the appeal can be gleaned from Mr. Bryant's application and statement of claim. In his application Mr Bryant sought declaratory relief, compensatory orders and "unspecified damages" for, inter alia, loss of business, loss of reputation and standing, stress and suffering. Exemplary damages were also claimed. If the appeal was prosecuted by Mr Bryant to a successful conclusion, subject to any issues arising in relation to the pleadings, his claims in his application and statement of claim could proceed to trial. At any trial the Court might have to give consideration, inter alia, to Mr. Bryant's claims including those relating to the "personal injury or wrong" allegedly done to him. Clearly, in the present case, the issue of whether the action (i.e. the appeal) is in respect of "any personal injury or wrong" is to be determined on the basis of the pleadings in the original proceeding. We turn then to consider those pleadings. They were described by Sackville J at 3-7 as follows: The relief sought by Mr Bryant in his application in the present proceedings falls into several classes: (i) declarations that the Bank does not have a power of sale pursuant to specified mortgages over ten identified properties (paragraphs 1-11, there being no paragraph 4 in the application); (ii) declarations that various letters of demand by the Bank, all of which were dated 19 September 1991 and addressed to Mr Bryant, were misleading, invalid and/or void and, in one case, constituted harassment and coercion of the applicant (paragraphs 12-29, 36-37); (iii) declarations that a notice, dated 4 October 1991, served by the Bank purportedly pursuant to s.57(2)(b) of the Real Property Act 1900 (NSW), was not issued according to law and was bad, misleading, deceptive, unconscionable, fraudulent and invalid, and also constituted harassment and coercion of the applicant (paragraphs 30-32); (iv) declarations that the notice of 4 October 1991 did not comply with the requirements of s.111(2)(b) of the Conveyancing Act 1919 (NSW) and was bad, misleading, deceptive, unconscionable, fraudulent and invalid and also constituted harassment and coercion of the applicant (paragraphs 33-35); and (v) an order that the Bank be "punished for its actions" and that it compensate Mr Bryant for loss and damage, the damage to be in respect of loss of businesses, professional reputation, standing, amenities, stress and suffering, as well as exemplary damages (paragraphs 38-39). THE STATEMENT OF CLAIM The statement of claim makes a number of allegations: (i) At all material times Mr Bryant was the registered proprietor of ten lots of land in various parts of New South Wales, but mostly at Upper Turong, near Sofala (paragraphs 1-11; there being no paragraph 4 in the statement of claim). (ii) By a series of five mortgages, executed during the period from 12 August 1983 until 30 September 1987, Mr Bryant mortgaged his interest in each of the lots, for the purpose of securing the payment of principal interest and other moneys agreed to be paid by him to the Bank (paragraphs 12-22). (All of the mortgages were said to be registered under the Real Property Act 1900. One mortgage, over portions 67, 238, 248, 521 and 522 in the shire of Evans, Parish of Sofala, county of Foxburgh, being part of the property known as "Caralee", was said to be in "Registered Book 3563, No. 949", suggesting that it was an old system mortgage. However, it appears from the evidence that the relevant properties were subsequently been converted to Real Property Act title. (iii) By letters of demand dated 19 September 1991 the Bank alleged defaults under the mortgages that had not occurred in fact (paragraph 26). (iv) On or about 4 October 1991, by a notice pursuant to s.57(2)(b) of the Real Property Act, the Bank demanded that Mr Bryant pay within one month an amount of $2,095,660.77 plus costs (paragraph 23). (v) The notice did not comply with the strict requirements of the Real Property Act 1900, alleged a default that had not occurred and was "misleading, deceptive and unconscionable and caused the applicant to be [misled] and deceived and suffer loss and damage" (paragraphs 27, 28). (vi) The notice also did not comply with the strict requirements of "the relevant sections of the Conveyancing Act 1919" (paragraph 29). (vii) Mr Bryant relied on the formal demands in the letters of demand and notice and organised his affairs in accordance with the demands and notice (paragraph 24). The Bank negligently or maliciously delivered the demands and notice knowing that Mr Bryant would rely on them as correct and lawful (paragraph 25). (viii) On about 25 February 1992 Colin Gregory Cavanagh swore an affidavit, which was read in proceedings commenced by the Bank in the Supreme Court. In that affidavit he swore falsely that the Bank had served demands and notice in accordance with the strict requirements of the Real Property Act (paragraph 30). The affidavit was misleading, deceptive and unconscionable and caused the applicant to be misled and suffer loss and damage (paragraphs 31, 32). (ix) The Bank fraudulently intended to mislead, deceive and coerce Mr Bryant into leaving and losing the properties. Further, the Bank fraudulently obtained possession of Mr Bryant's real property and took action to sell the property (paragraphs 33, 35). (x) The Bank owed a fiduciary duty and duty of care to Mr Bryant and acted (in an unspecified way) contrary to its duties (paragraphs 36-39). It is evident from the pleadings that Mr Bryant endeavoured to raise several causes of action. Putting to one side the legal efficacy of some of his claims, it is also evident that the pleadings have all the hall-marks of a commercial cause arising out of Mr Bryant's alleged financial or property rights. The essential claim in the pleadings is centred upon a challenge to the Bank's rights to exercise its powers as a secured creditor. In the Court below, Sackville J considered that by reason of the earlier litigation Mr Bryant was estopped from proceeding with that challenge. But the correctness of that and the other conclusions reached by Sackville J only arises if Mr Bryant is permitted to continue with his appeal. The issue that must be determined at this stage is whether "the action" by Mr Bryant including his claims for damages that are said to be consequential upon the Bank's impugned conduct, or any severable part thereof, is to be categorised for the purposes of s 60(4) as an action in respect of "personal injury or wrong" done to Mr Bryant. For present purposes, we will assume in Mr Bryant's favour that his claims for damages for harm to his reputation and for personal injury consequential upon the allegedly wrongful conduct of the Bank, which he is seeking to impugn, are severable from the other relief sought by him: see Faulkner v. Bluett (1981) 52 FLR 115 at 119 per Lockhart J. SECTION 60(4) The true nature of Mr Bryant's causes of action in his original proceedings, for the purposes of s 60(4), is to found in the common law of bankruptcy. The traditional starting point is Beckham v Drake (1849) 2 HLC 579 (9 ER 1213). In that case, the plaintiff sued for damages for breach of a contract of employment when his services were terminated. The defendants successfully pleaded that, as the plaintiff had become bankrupt after the causes of action had accrued and before the commencement of proceedings, the right of action had passed to his assignee in bankruptcy. In explaining the line of demarcation between personal and property rights Erle J said at 604: "The right of action does not pass where the damages are to be estimated by immediate reference to pain felt by the bankrupt in respect of his body, mind, or character, and without immediate reference to his rights of property. See also the remarks of Maule J at 626 and Wilde LCJ at 634. The decision in Beckham v Drake was approved by the House of Lords in Wilson v United Counties Bank, Limited [1920] AC 102. In that case the plaintiff and his trustee in bankruptcy sued the bank for damages for breach of contract. The jury found that the bank had agreed with the plaintiff to supervise the financial aspects of his business during his absence on military service and to take all reasonable steps to maintain his credit and reputation. The jury further found that the bank had been negligent in the discharge of its duties and that its negligence had caused the plaintiff's bankruptcy. The plaintiff was awarded slightly in excess of 45,000 pounds in damages for the loss occasioned to the bankrupt's estate and a further 7,500 pounds in damages for the injury caused to the bankrupt's credit and reputation by the defendant's negligent conduct. It was held that the right to claim damages for injury to the bankrupt's credit and reputation did not pass to the trustee in bankruptcy and that the bankrupt was entitled to retain the 7,500 pounds for his personal use. The decision in Wilson v United Counties Bank was considered by Dixon J in Cox v Journeaux (1935) 52 CLR 713. The plaintiff had commenced proceedings in the High Court "for conspiracy to injure him in the minds of the business community and the public generally". The defendants sought summary dismissal on various grounds. One of those grounds was that the estate of the plaintiff had been sequestrated after the commencement of the proceedings. The defendants argued that the action, not being one for personal injury or wrong, should be deemed to have been abandoned by the trustee in bankruptcy. Dixon J came to the conclusion that the plaintiff's case was without merit. He said:- "An attempt to go behind the formulation of the claim for damages and look at the actual facts inevitably leads back to an examination of the cause of action, and, as my conclusion is that none exists or could be discovered, I have felt it better not to engage in a futile consideration of the hypothetical question which classification it would fall under if it had a real or colourable existence." (at 721) However, in the course of reaching that conclusion his Honour observed that the earlier statutory equivalent of ss 60(3) and (4) had stated the common law of bankruptcy. After referring to Wilson v United Counties Bank Ltd Dixon J said: "The test appears to be whether the damages or part of them are to be estimated by immediate reference to pain felt by the bankrupt in respect of his mind, body or character and without reference to his rights of property." (at 721) More recently, Lockhart J examined in detail the development of bankruptcy law on this subject in Faulkner v Bluett (supra). In that case the plaintiff had instituted proceedings in the High Court seeking damages from the Commonwealth arising out of the conduct of its agent, a Brigadier Flint. The claim was based on misrepresentations and negligent mis-statements. His Honour observed at 118: Although bankruptcy is the creature of statute law, certain rules have been formulated from time to time by the English courts exercising bankruptcy jurisdiction which limit the literal interpretation of vesting sections in bankruptcy legislation and which have been called "the common law of bankruptcy". Lockhart J traced the development of the bankruptcy cases and their treatment of exceptions to the general rule that the property of a bankrupt vests in the trustee. After giving examples of the better known exceptions his Honour said at 119: The common thread running through these cases is that where the primary and substantial right of action is direct pecuniary loss to the property or estate of the bankrupt, the right to sue passes to the trustee notwithstanding that it may have produced personal inconvenience to the bankrupt: Wetherell v Julius; Wage on Bankruptcy (1904 ed.), P.201. Where the essential cause of action is the personal injury done to the person or feelings of the bankrupt the right to sue remains with the bankrupt. (footnotes omitted) Lockhart J regarded the test in Wilson v United Counties Bank as stated by Dixon J in Cox v Journeaux as applicable to ss 60(3) and (4) and concluded at 122: The right of action of the applicant is directly related to her property or her estate, namely, her shares in Trisal Engineering Pty. Ltd. and her interests in the patents or the Trisal clips. Any damages to which the applicant may be entitled would be estimated by immediate reference to her rights of property and not to pain felt by her in respect of her "body, mind or character". More recently in Daemar v Industrial Commission of New South Wales (supra) the bankrupt sought orders, principally for relief in the nature of prerogative writs directed to the Commission, claiming that a "wrong" had been done to him by the Commission. After referring to the test in Wilson v United Counties Bank Kirby P (with whom Samuels and Clarke JJA agreed) said at 56: Applying that test to the present case, the action brought by the claimant cannot be categorised as he submits. Although it is true that the claimant contends that a "wrong" has been done to him and that he has suffered hurt and even "defamation" in the course of the judgments of the Commission, these contentions are irrelevant to the task of identifying, for the purpose of s 60(4)(a) of the Act, the nature of the action exempted from the stay. The exemption is limited to those cases where it has been considered appropriate to sever the personal interests of the person subsequently made bankrupt from his property, and to reserve to him the prosecution of and benefits derived from such litigation as not being legitimately entitlements of the creditors. In the present case the so called "wrong" of which the claimant complains is the very source of the financial problems which have led to his bankruptcy. It is therefore to be classified not as a "wrong" which is exempted from the operation of s 60(2) and the statutory stay provided for but as of the very essence of the subject matter to which s 60(2) is addressed. As in Daemar, the "wrong" of which Mr Bryant complains in his pleadings appears to be the very source of the financial problems which led to his bankruptcy. Of the authorities to which the Court was referred, the one that most closely resembles the facts of this case is the unreported decision of the New South Wales Court of Appeal in Manningel v Hewlett, Phelps & Others (judgment delivered 12 June 1991). The plaintiffs had sued their former solicitors for professional negligence arising out of the plaintiffs' purchase of a parcel of land and the construction of a house on that land. They pleaded their case both in contract and tort. The plaintiffs claimed damages for their economic loss and under pars 17(e), 17(f), 17(g) of their statement of claim, sought damages for loss of credit and reputation, for inconvenience, mental distress and strain as well as for injury to their physical and mental health. Subsequent to the issue of proceedings, both plaintiffs became bankrupt but obtained their discharge before the case was called on for hearing. The defendants applied to the trial judge for a determination (as a separate question) that the causes of action sued upon had passed to the plaintiffs' trustee in bankruptcy on the making of the sequestration orders. The trial judge upheld the defendants' submission and summarily dismissed the plaintiffs' action. The Court of Appeal noted that the trustee in bankruptcy had not been called upon to elect and concluded that the correct order should have been an order staying the proceedings until an election to prosecute or discontinue the action had been made. The appeal was allowed for that limited purpose; in all other respects the Court of Appeal upheld the decision of the trial judge. Handley JA (with whom Kirby P and Meagher JA agreed) at 4-5 described the plaintiff's claim for damages in these terms:- The plaintiffs claimed damages in the proceedings in the manner particularised in par 17(e), (f) and (g) of their amended statement of claim but these claims were consequential upon alleged breaches of professional duty owed to them by the defendants in relation to the purchase of the land and the contract by the vendor to erect a dwelling house on it. The plaintiffs' claims for damages for loss of credit, for mental distress, inconvenience and for injury to their physical and mental health therefore were not claims "without reference to their rights of property" within the principle stated by Dixon J. On the contrary those claims were consequential on damages to the plaintiffs' financial and property interests as a result of alleged breaches of professional duty by the solicitors. CONCLUSION The remarks of Handley JA are apposite to and fairly summarise Mr Bryant's position. Mr. Bryant's causes of action, as pleaded in his statement of claim, are essentially claims which are referable to his financial and property rights. That is not to deny him his right to allege "personal injury or wrong done to" him or members of his family. 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 (supra), then "the primary and substantial right of action is direct pecuniary loss to the property or estate of the bankrupt" (at 119). To apply the language of Handley JA in Manningell v Hewlett to Mr Bryant's circumstances his claims for stress and suffering were "consequential upon alleged breaches" of duty said to be owed to him by the Bank as a mortgagee or secured creditor and were not claims "without reference to [his] rights of property", within the principle stated by Dixon J. in Cox v Journeaux. In our opinion the Bank is entitled to an order dismissing the appeal with costs. I certify that this and the preceding eleven (11) pages are a true copy of the Reasons for Judgment herein of their Honours Justice O'Loughlin and Justice Merkel. Associate: Date: Counsel for the Applicant: Mr J Bryant appeared in person Counsel for the Respondent: Ms R Sofroniou Solicitor for the Respondent: Shaw McDonald Date of Hearing: 26 February 1997