Chng v Shome

REASONS FOR JUDGMENT 1 There is before the Court a creditor's petition for a sequestration order against the estate of the respondent based on non-compliance with a bankruptcy notice ("the notice") issued on 17 December 1999. The petition came before me on 3 April 2000, referred by Deputy Registrar Wood. 2 The only issue of significance in the matter is the validity or otherwise of the notice. It arises in light of the way in which reference to the applicant and the confirmatory signature on the schedule to the notice were completed. The form required to be completed is prescribed by s 41(2) of the Bankruptcy Act 1966 (Cth)("the Act") and reg 4.02 of the Bankruptcy Regulations. The scheme set out in the Act requires the creditor, or the creditor's agent, to complete a draft bankruptcy notice which is submitted to the Official Receiver under whose authority the notice may be issued. In the present case, the notice served on the respondent bore the seal of the Official Receiver's delegate. 3 That part of the notice which is at issue is as follows:

4 A Full Court of this Court, in Trustees of the Franciscan Missionaries of Mary v Weir [2000] FCA 574 ("Franciscan Missionaries") has recently considered a similar issue, and declined to follow the reasoning of a line of decisions at first instance culminating in National Australia Bank Limited v Westbrook [2000] FCA 246. The Full Court reached this conclusion (at para 10) about the effect of the language in which the form prescribed by reg.4.02 is cast: "Neither the use of the singular number nor the use of the masculine and feminine genders can require the form to be read as excluding, on the one hand, several applicants, and on the other, an inanimate applicant, such as an ordinary corporation. Apart from obvious questions of convenience, the language of the form - "he or she is the creditor/the creditor's authorised agent" - requires the rejection of his Honour's tentative conclusion. For the summary expression "he or she" must be accommodated to the case of joint creditors and to the case of a corporate creditor, just as much as to the case of an authorised agent. The draftsman plainly did not intend corporations and joint creditors to be excluded; but neither was it intended that differences of number and gender should be ignored by the multiplication, in the issue of bankruptcy notices, of psittacine recapitulations of the very words of the form, whether appropriate or not. Once both of these points are recognized, the words "he or she is" must be seen to be subject to amendment as required, and cannot have a controlling operation on the construction of the form: cf. Downey v Pryor (1960) 103 CLR 353 at 361-362, per Kitto J." 5 The Full Court went on to say (at para 12): "In the final analysis, the fundamental question is simply whether the prescribed form requires the personal signature of the applicant for the issue of the bankruptcy notice. In our opinion, the language of the form should not be construed as having that confining effect." [original emphasis] 6 In that case, the Full Court was concerned with a notice signed by and in the name of an employed solicitor, who had been authorised to sign by the creditor's agent. I do not regard it as significant that the signature on the notice in the current case was affixed by an authorised employed solicitor, but who signed the name of the firm, Gadens Ridgeway, which acted as the creditor's agent. The question whether a personal signature of the creditor's agent is required has been resolved in Franciscan Missionaries. Further, according to s 308 of the Act, "a partnership may act by any of its members, or a duly authorised agent …", with the result that the essential requirement for the valid completion of this bankruptcy notice was that a signature, though not necessarily a personal signature of a natural person, had to be affixed to the notice by a person duly authorised. The evidence in this matter is that the employed solicitor (a Ms Andrea Thomson) was so authorised. 7 These conclusions dispose of the substantial issue, making it unnecessary to consider the submissions advanced in the alternative on behalf of the petitioning creditor that if the bankruptcy notice was defective because the person who applied for it had not properly confirmed by signature that "he or she" was the creditor's authorised agent, that is a formal defect which may be cured by resort to s 306 of the Act. On that issue I note the discussion in Franciscan Missionaries (at para 17) of the apparent conflict in authority between two Full Courts of this Court, differently constituted, in Bendigo Bank v Williams [2000] FCA 482 and Kirk v Ashdown [1999] FCA 1664, but it is unnecessary for me to enter into that controversy. 8 In the result, there being no other impediment to acceptance of the creditor's proofs of the matters required by the Act, there will be a sequestration order against the estate of the debtor. The petitioning creditor's costs, including the costs of the hearing on 3 April 2000 and any reserved costs, should be taxed and paid out of the estate of the bankrupt. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan.