Hennessy, Re A.J. Bankrupt, Ex Parte The

[1988] FCA 592

IN THE FEDERAL COURT OF AUSTRALIA	)
GENERAL DIVISION	1 QLD E156 Of 1987
BANKRUPTCY DISTRICT	OF THE SOUTHERN
DISTRICT OF THE STATE	OF QUEENSLAND

RE: ANTHONY JOHN HENNESSY

EX PARTE: THE BANKRUPT

MINUTES OF ORDER

JUDGE MAKING ORDER:	PINCUS J.
DATE OF ORDER:	19 SEPTEMBER 1988
WHERE MADE:	BRISBANE
THE COURT ORDERS THAT:

1. the application for disc :harge be dismissed.

IN THE FEDERAL COURT	OF	AUSTRALIA	1
GENERAL DIVISION	1 QLD E156 Of 1987
BANKRUPTCY DISTRICT OF	THE SOUTHERN	)	L-

DISTRICT OF THE STATE OF QUEENSLAND ) ;

RE: ANTHONY JOHN HENNESSY

EX PARTE:  THE BANKRUPT

PINCUS J. 19 SEPTEMBER 1988

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EX TEMPORE REASONS FOR JUDGMENT

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The applicant	Mr	Hennessy, who has given evidence orally	1 -I
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and in affidavit form, became bankrupt on 13 February 1987. The I. .

cause of his bankruptcy was the failure of a book selling company

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in which he had an interest and whose debts	he had guaranteed.	1 ,
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The debts, according to the material, consisted in	a	sum of	a	L .
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little over $200,000,	and the principal debtor was	the AN2 Bank in
the sum $197,984.56.

The trustee's report says that secured creditors did not

cover their debts	from	the	sale	of	property	the	subject	of	i
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securities; from the sale of Mr Hennessy's share in a house

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property $25,000 was obtained and $35,000 from another source. By I .

that means the secured creditors were paid out; the unsecured r .'

creditors were not. Mr Hennessy says that	he had also	about
reasons which I do not quite follow, that sum appears	s $3,600 in	r .
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the trustee's 'report. I do not know what the reason for the

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discrepancy is, but it is not of any present consequence.

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The evidence is that Mr Hennessy has, in effect,

preferred some creditors, to a minor extent. He has paid some

Bankcard and Visa debts out by irregular instalments. The

immediate cause of the bankruptcy, so far as I can gather from the

evidence, was two-fold:  one, that a secured creditor (wrongly, in

Mr Hennessy's view) insisted on the appointment of a receiver and

manager at a time when there was no need for that step to be taken; secondly, he says that the other person interested in the

venture spent	excessive amounts of money on personal expenses
which were charged up to the business.	I4r Hennessy told me that
he tried to stop this happening but failed to	do so.

The affidavlt which was filed in support of the

application for discharge was in rather an unusual form, in that

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it simply swore to what mlght be called negative matters and gave

no indicatlon of the cause of the bankruptcy or of any of the

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circumstances whlch might induce the Court to exercise its ..

discretion in favour of the application. However, that has turned

out not to be of any importance because Mr Hennessy has explained,

at least in a general way, what has happened.

He seems to me to be an honest man who has given me an

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account of the matter which is, or seems to him to	be, correct.	..
Nevertheless, it	is clear that the application must	be refused.

When asked why he wants the discharge, Mr Hennessy said in effect

that he feels the stigma of bankruptcy and he wishes to have it

lifted. He does not suggest that it would make any difference to

his present mode of business activity.

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I must say that I found Mr Hennessy an impressive

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witness, and were it a matter of mere sympathy	I would accede to
the application. The reason given for granting a discharge is,	in
my	opinion, inadequate. Every bankrupt feels to a greater or

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lesser extent the social and personal disadvantage of being marked	I .J
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as a business failure.	Mr Hennessy feels that,	I would think,	I ,
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more keenly than most, being the sort	of man that he is. However,
he has gone bankrupt owing a substantial sum	of money. He has no

particular justificaton for a premature discharge other than what

might be described as personal reasons. That does not, in my

opinion, constitute a reason for cutting short the ordinary period

of bankruptcy, and the applicatlon must be refused.

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f certify that thl; and the & preceding

.-S arz a trup copy of the reasons for

:t*s+ment hcrein of H:s Honour

M r Justice Pincus

#&LA Associate