Sunderland v G & J Drivas Pty Ltd

REASONS FOR JUDGMENT 1 This is an application to set aside a bankruptcy notice issued on 4 February 2000 at the request of the respondents. The bankruptcy notice was issued on the basis of a default judgment obtained in the District Court. The evidence filed by the applicant in support of the application falls into two categories. 2 First, it consists of evidence from the applicant and her husband which if true, would establish that the bankruptcy notice was not served personally on the applicant on 8 February 2000 as the process server contends, but was served on the applicant's husband on 9 February 2000, who later that evening gave the documents which had been served upon him to the applicant. 3 It seems to me that the issue of whether or not the bankruptcy notice has been properly served is not an issue which arises in relation to an application to set aside the bankruptcy notice. It is an issue which could arise on the hearing of a petition if Ms Sunderland wished to oppose the petition upon the basis that she was not served with a bankruptcy notice, and thus had not committed an act of bankruptcy. I therefore propose not to determine the factual issue which arises in relation to service. 4 The second category of evidence is designed to show that the bankruptcy notice is defective in two respects. The first is an alleged over-statement of interest and the second is an alleged typographical error which appears in cl 7.2 of the bankruptcy notice. So far as the interest over-statement is concerned, the amount claimed in the bankruptcy notice includes interest in the period 18 January 2000 to 3 February 2000 in sum of $236.47. 5 The manner in which that sum was calculated is set out in Item 3 of the Schedule to the bankruptcy notice. The sum was calculated on the basis that there were 18 days in the period 18 January to 3 February. In fact, there were only 17, hence the applicant contends that the amount claimed in the bankruptcy notice was over-stated by $13.14. 6 On 29 February 2000 a notice disputing the validity of the bankruptcy notice on the basis that the amount claimed exceeded the amount in fact due, was given by the applicant's solicitors pursuant to s 41(5) of the Bankruptcy Act 1966 (Cth) ("the Act"). However, the bankruptcy notice was not issued until 4 February. By the time the notice was issued the debt for interest accrued since 18 January 2000 had swollen to $236.47, hence notwithstanding the error in calculation of the sum due as at 3 February 2000, there was no over-statement of the amount in fact due as at 4 February 2000. 7 The time at which the amount must be correctly stated is the date the notice is issued: Walsh v Deputy Commissioner of Taxation (Cth) (1984) 156 CLR 337. Clearly, there is an error in the calculation of the interest due as at 3 February 2000. The debtor might appreciate there has been an error in the calculation of the amount due on the day prior to the issue of the notice, but a debtor who undertook that calculation would also appreciate that the sum claimed was the amount due as at the date of issue of the notice, hence is not likely to be misled by the error in question. 8 The principles which are applicable in a case such as the present are referred to by a Full Court in Re George; Ex parte Tricontinental Corporation Limited (1994) 126 ALR 541, and in a decision of Kiefel J in Khadpekar v Kowanyama Aboriginal Council [1999] FCA 1748. It is clear that payment of the amount specified in the notice will constitute compliance with it. The notice therefore cannot reasonably be regarded as misleading and the error constitutes a formal defect or irregularity which is excused in terms of s 306 of the Act. 9 Paragraph 7.2 does contain a typographical error. It refers to an application mentioned in paragraph 7(a). There is no paragraph 7(a). The mistake is, I think, an obvious one and it is clear on a fair reading of the notice that the reference was intended to be a reference to paragraph 6(a). I do not think that this defect constitutes a material error. Section 306 applies to this defect, as well. 10 I therefore dismiss the application to set aside the bankruptcy notice with costs. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Hely.