Biggs v CNH Capital Aust Pty Ltd

[2006] FCA 357

FEDERAL COURT OF AUSTRALIA

Biggs v CNH Capital Aust Pty Ltd [2006] FCA 357

DARREN BIGGS AND MARK BIGGS v
CNH CAPITAL AUSTRALIA PTY LIMITED AND ANOR

NSD 374 of 2006

LINDGREN J
28 MARCH 2006
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
DISTRICT REGISTRY	NSD 374 of 2006

BETWEEN:

DARREN BIGGS AND MARK BIGGS
APPLICANTS

AND:

CNH CAPITAL AUSTRALIA PTY LIMITED
(ACN 069 132 396)
FIRST RESPONDENT

MICHAEL PELDAN
(TRUSTEE IN BANKRUPTCY)
SECOND RESPONDENT

JUDGE:	LINDGREN J
DATE OF ORDER:	28 MARCH 2006
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The application be dismissed.

2.The applicants pay the costs of the first respondent.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
DISTRICT REGISTRY	NSD 374 of 2006

BETWEEN:

DARREN BIGGS AND MARK BIGGS
APPLICANTS

AND:

CNH CAPITAL AUSTRALIA PTY LIMITED
(ACN 069 132 396)
FIRST RESPONDENT

MICHAEL PELDAN
(TRUSTEE IN BANKRUPTCY)
SECOND RESPONDENT

JUDGE:	LINDGREN J
DATE OF ORDER:	28 MARCH 2006
WHERE MADE:	SYDNEY

REASONS FOR JUDGMENT

1. The applicants seek an extension of time in which to appeal against a decision of the Federal Magistrates Court of Australia (‘FMCA’) which was given on 24 January 2006.  The time limit is 21 days as set out in O 52 r 15 of the Federal Court Rules.  That rule provides, however, that ‘for special reasons’ the Court or a Judge may at any time give leave to file and serve a notice of appeal. 

2. The 21 day period expired on 14 February 2006 and this proceeding was commenced on 23 February 2006 – nine days late.

3. The expression ‘special reasons’ in O 52 r 15 was considered in Jess v Scott (1986) 12 FCR 187 at 195. The reasons must take the case out of the ordinary run, but even if special reasons are shown, the Court still has a discretion whether to extend time.

4. Before the Federal Magistrate, the applicants sought review of the decision of a Registrar of the FMCA making a sequestration order ‘against the estates of DARREN BIGGS and MARK BIGGS’ on 1 December 2005.  Before me, the parties proceeded on the basis that the order dismissing the application for review was a final order from which an appeal lay as of right, so that the applicants need only an extension of time, not also leave to appeal as they would require if the order was interlocutory.

5. The applicants took two points before the Federal Magistrate.  The first is that the bankruptcy notice was invalid because it was addressed to two people.  They contended that a bankruptcy notice may be addressed only to one person, so that a separate bankruptcy notice was required for each applicant.  The second point is that the bankruptcy petition was invalid because it misdescribed each act of bankruptcy: the creditor’s petition referred to each act of bankruptcy as having occurred ‘on’ a particular date, and the argument is that it should have said ‘on or before’ or ‘by’.

6. The bankruptcy notice was served on Darren Biggs on 30 August 2005 and on Mark Biggs on 31 August 2005.  The 21-day period for compliance expired on 21 September 2005 for Mark Biggs, and on 20 September 2005 for Darren Biggs.  The creditor’s petition was served on Mark Biggs on 19 October 2005 and on Darren Biggs on 25 October 2005.

7. Before addressing the question of the explanation for the delay, I will turn to the two grounds relied upon before the Federal Magistrate.  These are also the grounds stated in the applicants’ draft notice of appeal.

8. The bankruptcy notice was addressed to ‘Darren Biggs and Mark Biggs (“the debtor”)’.  There was attached to it a certificate of judgment in the District Court of New South Wales at Parramatta dated 11 April 2005 showing Darren Biggs and Mark Biggs as ‘judgment debtors’.  They were not referred to separately as ‘First Judgment Debtor’ and ‘Second Judgment Debtor’.  It has not been suggested, either before the Federal Magistrate or before me, that they were other than joint debtors.

9. The question whether a bankruptcy notice can be issued against joint debtors was resolved in the affirmative by a Full Court of this Court in Hubner v Australia and New Zealand Banking Group Limited (1999) 88 FCR 445 at [13]-[22]. In an earlier case, Macleod v Beneficial Finance Corporation Limited (unreported, Branson J, 5 October 1995) had also held that a bankruptcy notice may be issued against joint debtors.

10. This morning, Mr Knaggs, the solicitor for the applicants, submits that an amendment made to the Bankruptcy Act1966 (Cth) (‘the Act’) in 1996 by the addition of the words ‘or she’ after the word ‘he’ throughout the Act indicates that the provision of s 23(b) of the Acts Interpretation Act 1901 (Cth), which has the effect that in any Act, unless the contrary opinion appears, words in the singular include the plural, does not apply. I do not agree. The amendment was obviously dictated by nothing more than the legislative desire for gender neutrality in the language of Commonwealth Acts.

11. In my view, the first point does not have sufficient merit to warrant the attention of a Full Court.

12. The second point has no merit either. The act of bankruptcy provided for in s 40(1)(g) of the Act is committed at midnight on the last day for compliance with the requirements of the bankruptcy notice. The reason is that the debtor has not complied with those requirements within the period stipulated in the notice that expires at midnight on that day. Until that expiry there is no act of bankruptcy because compliance remains a possibility.

13. This point also does not warrant the attention of a Full Court.

14. I turn now to the explanation for the delay.

15. The ground on which the applicants rely is stated in an affidavit of Mr Knaggs, their solicitor, sworn 23 February 2006, as follows:

    ‘I am informed by my clients and verily believe that a delay in filing in confirming to me their instructions to appeal was caused by the tragic and [sic] death of their mother after a battle with cancer on Thursday last 16 February 2006; that in turn caused the delay in filing the application, resulting in the need for this application for extension of time.

    I had warned them of the need for haste but I understand their grief and their distance from Sydney conspired to delay those instructions.’

16. It will be noted that the time for appealing had expired on 14 February, a little prior to the death of the mother.  There is no affidavit from either applicant.  There is no evidence other than that found in Mr Knaggs’s affidavit set out above as to what transpired between 24 January 2006 and 23 February 2006.  If Mr Knaggs gave his warning to the applicants on or shortly after 24 January 2006, as I presume he did, their delay is not adequately explained by their mother’s death on 16 February 2006, two days after the appeal period expired.

17. Mr Wilson, the solicitor for the first respondent (the petitioning creditor), wrote a letter to Mr Knaggs on 10 March 2006 requesting a copy of the death certificate relating to the mother.  This was perhaps an unusual request.  There was no reply.  Mr Knaggs has stated from the Bar table this morning that a death certificate has not yet been released by the Coroner.  He tendered a poor photocopy of a document purporting to be a newspaper notice of the mother’s death.   It did not bear the newspaper’s name or any other indication of the identity of the newspaper.  However, it referred to Leona [the second given name is not clearly legible] Biggs, the mother of, relevantly, Darren and Mark Biggs, having died on 16 February 2006.  The notice was in the familiar format of a newspaper death notice.  I proceed on the basis that the applicants’ mother did indeed die on 16 February 2006.  I admitted the document into evidence over Mr Wilson’s objection.

18. No doubt the reason why Mr Wilson requested a copy of the death certificate is to be found in the long history of the proceeding in the FMCA.  That history is as follows.

19. On 17 November 2005 Mr Wilson appeared for the petitioning creditor before Registrar Hedge of the FMCA and Mr Knaggs appeared for the debtors (the present applicants).  Mr Knaggs sought an adjournment on the basis that he was instructed to remove a caveat and list the debtors’ property for sale.  According to Mr Wilson’s affidavit, Mr Knaggs said that the proceeds of sale would be used to pay the petitioning creditor’s debt.  Mr Wilson informed the Court that on the basis that the debtors would remove the caveat and list the property for sale, he was instructed to consent to the adjournment.  The hearing of the petition was adjourned until 1 December 2005. 

20. On 17 November 2005 Mr Wilson wrote to Mr Knaggs seeking a copy of his clients’ certificate of title and caveat.  Those documents have never been provided.

21. On 1 December 2005 Mr Wilson again appeared for the petitioning creditor and Mr Knaggs again appeared for the debtors. Mr Knaggs sought an adjournment on the basis that his clients thought that the hearing had been listed for the following day, 2 December 2005. He said that he had been unable to contact his clients. Mr Wilson sought leave to file an affidavit annexing correspondence forwarded to the debtors advising of the hearing date. Registrar Hedge refused to grant the adjournment. Mr Knaggs then sought leave to file a Notice of Intention to Oppose Petition and asked that the matter be given a hearing date. Mr Wilson informed the Registrar that he had read the Notice of Intention to Oppose Petition and was ready to proceed with the hearing immediately. The hearing proceeded and the Registrar made a sequestration order against the estates of the debtors with an order that the petitioning creditor’s costs be paid out of their estates in accordance with the Act.

22. On 22 December 2005 the applicants filed in the FMCA an application for review of the Registrar’s decision.  The application was served on the petitioning creditor on 9 January 2006.  On 17 January 2006, the application first came before Registrar Segal when Mr Knaggs asked for an adjournment of his clients’ application to enable him more time to prepare submissions.  Mr Wilson replied that he was ready for a hearing immediately and opposed the granting of an adjournment.  The Registrar in fact granted an adjournment.  He asked whether two weeks would be long enough, but Mr Knaggs said that one week would be sufficient.  Accordingly, the hearing of the application for a review was adjourned for seven days to 24 January 2006.

23. On 24 January 2006 Mr Wilson again appeared for the creditor and Mr Knaggs for the debtors.  Mr Knaggs sought an adjournment to enable him more time to prepare submissions.  Mr Wilson opposed the adjournment and said that he was ready for the hearing.  Registrar Segal referred the application for review to a Federal Magistrate, Scarlett FM, who dismissed the application with costs.  That dismissal is the order in respect of which the present application is made.

24. The circumstances recounted above show that the applicants were responsible for several delays in the FMCA.  That conduct no doubt explains why Mr Wilson requested to be supplied with the death certificate in respect of the death of the applicants’ mother.

25. Ordinarily, a death of a mother would no doubt be a strong consideration, but I am not satisfied that the delay, albeit of only nine days, has been satisfactorily explained.  For this additional reason, the application for extension of time should be refused. 

26. If the Federal Magistrate’s decision was interlocutory with the consequence that there was no right of appeal and that leave to appeal was required, it is clear from my reasoning above that that leave, if sought, would have been refused by me and the present application would again have been dismissed.

27. The application will be dismissed with costs.

I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren.

Associate:

Dated:             6 April 2006

Solicitor for the Applicant:	Mr D Knaggs
Solicitor for the Respondent:	Mr M Wilson
The Second Applicant did not appear.
Date of Hearing:	28 March 2006
Date of Judgment:	28 March 2006