| I | excess of $80,000 owing by Mr Carpenter to Mr Gye and in those circumstances there is no reason at all why the petition should not be now heard, especially as no answer is given concerning this balance of $80,000. |
| In an affidavit filed in the proceedings, Mr Carpenter says that if the whole of the judgment debt has to be paid by him then he cannot do so, but that if Mrs McIntyre is successful in her appeal, he expected to be able to make arrangements for the |
| payment of any balance which he expected to be modest. I take from this that he expects the sum to be, as argued by his counsel, less than $1000. |
| Hence, according to the argument of counsel for Mr Gye, it is really not necessary for me to consider the merits or otherwise of Mr Justice Hill's judgment because there will still be a substantial amount owing by Mr Carpenter and he admits that he will be unable to pay it, at any rate in the near or forseeable future, although he might be able to arrange to obtain the money from somewhere else. |
| At the same time both counsel have argued that I should give some attention to Mr Justice Hill's judgment. It is put by counsel for Mr Gye that the appropriate law is that I should examine the judgment to see whether there is a serious doubt about the validity of his Honour's decision and thus to see whether a substantial injustice might result if I do not wait for the appeal. |
| Counsel for Mr Carpenter, on the other hand, says, as I | understand him, that I should take into account that Mr Justice | |
| Hill made a painstaking and careful review of the law on the matters before him dating back some 350 years. Even still his Honour acknowledged that the conclusion to which he came produced, if not injustice, then certainly an anomaly, in that a composition with creditors offered by Mr Gye in 1985 could not be availed of or used in any way by Mrs McIntyre to prove the particular debt which she claimed to have. |
| I expressed in argument and say again that I am not willing to engage in any examination of the correctness or otherwise of Mr Justice Hill's judgment. This is not an application for leave to appeal his Honour's decision on an interlocutory matter. Although similar principles have been called in aid in argument to suggest that they should or might be applied in such circumstances as these, I am unable to agree that this is the approach that ought to be taken. There is an appeal as of right from Mr Justice Hill's judgment and I am informed that the appeal has already been lodged. The matter is now in the entirely exclusive domain of a Full Court of this Court and it is not only inappropriate but unhelpful and invidious that another single judge express even a passing view about whether his Honour's judgment is or is not likely to be upheld. I have not even heard argument on the matters that were agitated before his Honour in any serious way, although the arguments have been summarily explained to me. In these circumstances, it is just not appropriate and I do not feel myself in a position to comment one way or the other on the judgment which has been given. |
| Hence I should move to consider the second matter that has been | argued. That gives rise to a major dispute of principle between | |
| the parties and this dispute of principle will have to be agitated only in the event that Mr Justice Hill's judgment is overturned. His Honour expressly declined to deal with the matter and did not even indicate, quite rightly I think, what view he would or might have taken in the event that it had required to be determined. |
| It seems that this issue of principle was argued before his Honour. However, despite my questioning of counsel for Mr Carpenter today, I am unable completely to understand the basis upon which the argument was put then and is put now. It will suffice to summarise that each of these parties is in debt to the other for different sums. On any view, there is a balance owed by Mr Carpenter. The argument for Mr Gye is that the $80,000 sum is reached by assuming that the judgment he obtained against Mrs McIntyre, and thus the judgment he obtained against Mr Carpenter, will fall. In that event, the argument goes, the balance between the amounts owing by and to these parties as at today's date or close thereto is of the order of this $80,000 owed by Mr Carpenter to Mr Gye. |
| The argument on behalf of Mr Carpenter is that the correct time at which to assess the balance between the two sets of debts is the time of the composition offered by Mr Gye to his creditors in April 1985. As I understand it, the balancing figure which Mr Carpenter would owe to Mr Gye is to be calculated by taking the judgment given by Mr Justice Brownie and by deducting interest |
| from 1988 back to 1985, or some such method. A figure other than | |
| the actual judgment figure entered by his Honour would then be arrived at. In other words, although interest would ordinarily be added from 1985 to 1989 on any balance between the respective debts from time to time, the state of the nett indebtness should be assessed as at the time of the composition. This leads to the suggestion that less than one thousand dollars is owing. |
| No authority was quoted to support this method of calculation. |
| or was any argument put as to how a bankruptcy notice would even |
| be expressed based upon such mathematical gymnastics. I know of no case and no case was cited in which this procedure had ever been adopted in the past, nor was any case or text book authority referred to which would give blessing to this mechanism being undertaken. If the matter was agitated before Mr Justice Hill and authority cited, it would have been readily available. I do not claim myself to be a mathematical or actuarial expert but I should even be surprised that, if the suggested calculation had to be made, it was as simple as was argued in its favour. |
| However, the main point is that I have no confidence at all that such an argument is respectably open. It seems to me that all of the provisions of the Bankruptcy Act are designed to ensure that at the time when a bankruptcy notice is issued on the basis of a judgment and a petition issued on the basis of non compliance with the bankruptcy notice, the debt referred to in the bankruptcy notice is to be the judgment figure, subject only to whether any part of the debt might be waived in some way by the judgment creditor. In this connection, as I recall the |
| authorities in the Court, it is not incumbent on the judgment | creditor to issue a bankruptcy notice for every last cent of the | |
| judgment debt. |
| Mr Carpenter is seeking the exercise of the court's discretion for an adjournment. Assuming in his favour that an appeal from Mr Justice Hill could or is even likely to be succesful, he has not shown that the resultant consequence would be a debt as low |
| as he claims. To the contrary, it seems to me that the debt is much more likely to be of the order of the $80,000 claimed by Mr Gye than anything in the vicinity of $1000 agitated by Mr Carpenter. |
| That leaves the question of any residual discretion; that is, whether there are over-riding grounds for adjourning a creditor's petition even to enable an apparently meritless argument to be advanced, as well as perhaps take other steps that might enable Mr Carpenter to avoid bankruptcy. |
| On the one hand, Mr Gye argues that a chartered accountant whom a Judge of the Supreme Court has found has committed fraud, as did Mr Justice Brownie in the proceedings to which I have referred, should not be allowed to continue practice in the public interest. On the other hand, counsel for Mr Carpenter argues, with a degree of understandable urgency, that the Court would be slow to interfere with a professional's right to practise unless it is palpably clear that no other course could conceivably prove to be available. |
| have referred, should not be allowed to continue practice in the | I do not think that because Mr Justn the proceedings to which I | |
| public interest. On the other hand, Counsel for Mr Carpenter argues, with a degree of understandable urgency, that the Court would be slow to interfere with a professional's right to practise unless it is palpably clear that no other course could conceivably prove to be available. |
| I do not think that because Mr Justice Brownie found on the facts before him dating back many years that Mr Carpenter had committed fraud, this should be allowed to determine for me whether this petition should be allowed to proceed. I do not think that these bankruptcy ptoceedings should be used as some form of penal sanction. Bankruptcy is not intended to be a basis for moral or criminal judgments which are not made by the Court determining the matter in the proceedings in which the determination is being made. On the other hand, I do not think that professional people are or ought to be entitled to any greater consideration, if the legal criteria for bankruptcy are established, than any other person in the community. It might even be argued that because professional people should undertake a higher degree of compliance with social and legal norms than other people, perhaps when their obligations are breached, they should be given less credence than members of the community who have not had the benefits of a professional education and experience. |
| Personally I do not think those sorts of approaches assist very much in consideration of matters of this kind. The question that has to be determined immediately is not whether Mr Carpenter |
| should be made bankrupt, because I have not yet considered the | evidence brought in support of the creditor's petition, but | |
| whether a discretion should be exercised in his favour of adjourning the hearing of an application for the sequestration of his estate which, as it seems to me on any view, is likely to owe a substantial sum of money whatever the result of other proceedings. He admits before me that he is not able to pay this sum of money although he may be able to arrange payment from somewhere else. |