H J Wigmore and Co Limited v Rundle

This case concerned an appeal to the High Court of Australia from a decision of the Supreme Court of Western Australia. The dispute arose when H. J. Wigmore &Co. Ltd. (the appellant) lodged a caveat against the registration of a bill of sale granted by George Harold Rundle and others (the respondents). The appellant claimed to be a creditor of the respondents and therefore entitled to lodge the caveat under the Bills of Sale Amendment Act 1906 (W.A.). The respondents sought to have the caveat removed, arguing that the appellant was not a creditor.

The central legal issue before the High Court was whether the appellant, as the holder of a hire-purchase agreement with the respondents, qualified as a "creditor" for the purposes of the Bills of Sale Amendment Act 1906 (W.A.). Specifically, the court had to determine the meaning of "debt due or to accrue due" as used in the Act and whether the hire-purchase agreement created a present or future debt owed by the respondents to the appellant. A further issue was the effect of promissory notes provided as collateral security under the agreement.

The Court reasoned that to be a creditor entitled to lodge a caveat, the caveator must be owed a debt that is presently owing, whether payable immediately or at a future time. The hire-purchase agreement in question did not create a debt for future rental payments because the hirer had an option to determine the hiring by returning the chattel and paying arrears and a proportionate part of the current rental. This provision was inconsistent with an absolute obligation to pay future instalments. Therefore, a debt only arose in respect of past hire. The Court also held that promissory notes given as collateral security did not create an immediate debt but were subject to conditions precedent that had not occurred. Accordingly, the appellant was not a creditor of the respondents at the time the caveat was lodged.

The High Court affirmed the decision of the Supreme Court of Western Australia, dismissing the appeal. The appellant was ordered to pay the costs of the appeal.