Re Cook, W.B. v. Ex parte Ingles & Tiffin (A Firm) [1987] FCA 423

IN THE FEDERAL COURT! OF AUSTRALIA ) GENERAL DIVISION ) QLD P662 of 1987

BANKRUPTCY DISTRICT OF THE SOUTHERN ) DISTRICT OF THE STATE OF QUEENSLAND )}

In this matter, the judgment debt is a sum of $1,431.38. The debt in question is not one sufficient to found a petition

under s.44(1) of the Bankruptcy Act 1966. However, there is

another small amount of money due which takes it above that.

Recently, the court in which the judgment was entered, the Magistrates Court, has made an order (it seems common ground) which has had the effect of deferring payment of the judgment so

that it becomes payable by instalments of $100 per month.

Mr. Morton, who has argued the matter helpfully on behalf of the petitioning creditor, has drawn my attention to the

decision of the High Court in Cain v. Whyte (1932-33) 48 C.L.R.

639. He says, and it seems to me correct, that the decision of a

Court, although no reasons were given, is useful authority on the extent of the Court's discretion to decline to make a

In Cain v. Whyte (above), a judgment had been entered in

the Supreme Court, but that Court had made an order under the

Financial Emergency Relief Extension Act 1932 (Q.) deferring payment of the whole of the judgment debt for a considerable

period. The Court in its bankruptcy jurisdiction had then to consider whether it would make a sequestration order on the basis

As to the exercise of the discretion, it may be that the High Court intended to agree with the remarks of the primary judge sitting in the Supreme Court in its bankruptcy jurisdiction, and

What Henchman J. said, in effect, in that case, was that there was a discretion to refuse a sequestration order, that the words "other sufficient cause" should not be limited to the one case where the Court was satisfied that the petition was put forward for some legitimate end, and that it was the duty of the bankruptcy judge to examine in each case, if the question was raised, whether there was other sufficient cause. His Honour took the view that it was for the debtor to show some cause overriding the interest of the public in the stopping of unremunerative

trading, and he mentioned other considerations of a similar sort.

I do not regard Cain v. Whyte as deciding anything which is critical for present purposes. The circumstances here seem to me to be very different from those which obtained in that case, and in particular it is of importance that the amount of the judgment debt in Cain v. Whyte was, by the standards of the time,

very large indeed. It was 7,980 pounds, at a time when there were

The debt here is quite small, and the case is one of a very different kind. It therefore seems to me that there is a prima facie ground to refuse to make a sequestration order in the exercise of discretion. It would seem to me to be rather ridiculous to do so in' the circumstances that the debtor is only liable for $100 a month, but Mr. Morton has persuaded me that rather than dismiss the petition, I should adjourn it to enable his side to pursue the matter in the Magistrates Court, and I will

The order will therefore be that the petition he adjourned to a date to be fixed; secondly, that notice of fixation of the date is sufficiently given by notice to the present solicitors acting for the parties; thirdly, that the costs he

reserved. ! certify that this and the © preceding paces are a true copy of the reasons for