George John Knight Ex Parte Turimetta Properties Pty Ltd [1979] FCA 95

Federal Court of Australia|1979-09-17|Before: Sheppard J, Lockhart J

Bankruptcy - bankruptcy notice ~ costs not claimed in notice - whether notice defective if costs not taxed at time of issue of bankruptcy notice - bankruptcy notice not defective.

Bankruptcy - bankruptcy notice ~- understatement of interest due ~ whether confusing or perplexing to

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BANKRUPTCY DISTRICT OF THE STATE OF No. 310 of 1979

ORDER JUDGE MAKING ORDER: LOCKHART J. WHERE MADE: SYDNEY DATE OF ORDER: 17 SEPTEMBER 1979

The petition be adjourned to a date to be fixed by arrangement between counsel and my associate for the purpose of hearing any applacation by the petitioning creditor to amend the

petition following the delivery of my reasons for judgment.

BANKRUPTCY DISTRICT OF THE STATE OF } NO. 310 of 1979 ) ) )

(a) It claims a sum of money in excess of the sum to which the petitioning creditor is entitled pursuant to its judgment in the

(b) It wrongly states the nature and basis of ithe petitioning creditor's entitlement to interest on the judgment by stating that

(d) It understates the gyudgment debt by failing to correctly state the amount af interest owing at the date of issue of

creditor of the debtor, and the petition filed by the petitioning creditor is in the form of a petition by an unsecured creditor. The security alleged by the debtor is a mortgage

The facts and the issues are the same as in the case of petition No. P 309 of 1979 against Wr. Florance save that the grounds of opposition to the petition by the debtor and referred io above as 1. (ec) and (d) do not apply in the

case of Ifr. Florance and the ground of objection raised by Mr. Flocance that the petition was not served on him is not

in my reasons for judgment in the case of Hr. Florance and

Florance on all grounds of objection except that described in 2. above relating to the petitioning creditor being a secured

creditor of Mr. Florance which I found aun his favour.

It follows that to the extent that there are common issues between the case of Mr. Florance and that of the

The only different question of fact is one which relates to the possible application of s, 306 to save the bankruptcy notice from invalidity if I had reached the

conclusion, which I did not in the case of Hr. Florance, that the bankruptcy notice was defective. In the Court of Appeal the debtor conducted his awn case and Wr. Florance was represented by counsel. However, the debtor adopted the reasoning presented by counsel for Hr. Florance. The debtor

was present in court throughout the whole of the proceedings before the Court of Appeal. In my opinion the conclusions I reached as ta the operation of s. 306, if it were to apply in

the case of Mr. Florance, apply equally in the case of the

It remains for me to consider the two grounds of attack on the validity of the bankruptcy nolice made by the debtor, but not by Mr. Florance, being grounds 1. (c) and (d)

I turn fiest to ground 1. (c). Mr. Kindred, who appeared for the debtor, submitted that as there was no mention of casts in the bankruptcy notice it was invalid. The point was but faintly argued. When the bankruptcy notice was issued is was impossible to give a notice that included

costs. They had not been taxed se execution could not issue

for their recovery. This grotind of ohbjertton to the validity

of the bankruptcy notice fails: see In Re G. J.3; Ex parte G. J. 1905 2 K.B. 678; and Re Ali David; Ex parte Abda

Lahood, an unreported decision of Evatt J. delivered 15 Narch

calculation of interest in the bankruptcy notice was

understated by the equivalent by two days' interest. The variatron of 2 days was a result of the gap between the date

of lodgment of the application for the issue of the

bankruptcy notice with the registrar and the date of issue

itself. It is agreed that the amount of the understatement

is $556.36. This understatement does not necessarily vitiate

the bankruptcy notice. In Re The Bankruptcy Act, 1966; Ex

23 A.L.R. 522 I said in relation to this very point:-

"Tf ai ygudgment creditor chooses to claim interest on a judgment debt, it is necessary for the calculation of the claim to be accurate, and for the period during which the claim is made to be specified: Re Mullavey; Ex parte A.N.Z. Banking Group (1977) 20 A.L.R. 276; Re Davis; Ex parte

Deputy Commissiones of Taxation (1963) 19 A.B.Cc. TOD; L963 ALCLR. 7645 and Re McDonald (1978) 18

Understatement of the-amount of statutory interesl accrued from the date of judgment ta the date of

issue of a bankruplcy notice or other date specified ain the notice does not necessarily

vitzrate the bankruptcy notice. Section 306 of the Acl may be capable of operating to validate a

and my own decision in Re Manion; Ex parte Deput Commissioner of re stion (a decision of ayeeit) UI979) 2S ALR. 270.

Having regard to all the facts, including the small amount of the understalement, namely $556.36, and the fact that the amount claimed by the notice totals $554,712.38, in my opinion the understatement could not be said to be capable of perplexing or embarrassing the debtor. In my cpinion s.

As I have found in favour of Mr. Florance, and therefore ihe debtor in this case, on the graund that the petitioning creditor is a secured creditor of the debtor, [I shall adopt the same course es I did in the case of Hr. Florance namely, to stand over the further hearing of the petition to a date to be fixed by arrangement with Counsel soa that the petitioning creditor may consider whether it wishes to apply to amend the petition to comply with the provisions of the Act relating to the presentation of petitions by

Accordingly, the pelition is adjourned to a dale to

be fixed by arrangement between counsel and my associate for

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the purpose of hearing any application by the petitioning creditor to amend the petition following the delivery of my

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At a glance

Court

Decision date

Before

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Judgment (51 paragraphs)

Cited By (1)