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Morgan v White

Morgan v White

Case [1912] HCA 50 12 August 1912

Appeal

Jurisdiction

Statutory Construction

Procedural Fairness

Insolvency

Statutory Interpretation

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15 CLR 1

[ ] MORGAN WHITE

RESPONDENT.

ON APPEAL FROM THE SUPREME COURT OF Bankruptcy - -Certificate of discharge, objections to-Prior bankruptcy or insulvency

outside New South Wales-Bankruptcy Act 1898 (N.S. W.) (No. 25 of 1898), secs. 39, 40 (h), (r).

Sec. 40 of the Bankruptcy Act 1898 sets out a number of facts on proof of any one of which the Court may, under sec. 39, either refuse, or suspend the operation of, an order of discharge from bankruptcy, amongst them being :-

" (h) That the bankrupt has on any previous occasion been adjudged bank- rupt or insolvent,

unless his estate then produced ten shillings in the pound, or a majority in number and value of the creditors in that estate certify that in their opinion the bankruptcy or insolvency was the result of misfortune only."

" (r) That the bankrupt has while an uncertificated bankrupt or insolvent obtained credit to the amount of £20 or upwards from any person without having first informed such person that he was an uncertificated bankrupt or insolvent."

15 CLR 2

Held, that the prior adjudication of bankruptcy or insolvency referred to is an adjudication in New South Wales, and does not include an adjudication of bankruptcy in Western Australia.

Decision of the Supreme Court of New South Wales (Simpson C.J. in Eq.): Re H. A. Morgan, 12 S.R. (N.S.W.), 9, reversed.

APPEAL from the Supreme Court of New South Wales.

An application by Harry Alfred Morgan, who had been adjudged a bankrupt on 18th November 1910, for a certificate of discharge was opposed by Frederick Gilbert White, a creditor, on the grounds -

1. That the bankrupt had on a previous occasion, to wit, in the State of Western Australia, been adjudged bankrupt and his estate did not produce ten shillings in the pound, the majority of his creditors not certifying that the bankruptcy was the result of misfortune only.

2. That the bankrupt did while an uncertificated bankrupt obtain credit to the amount of £20 and upwards to wit the sum of £500 from the above-named creditor without having first informed him that he was an uncertificated bankrupt as afore- said.

The Registrar in Bankruptcy dismissed the objections with costs, holding that the words in sec. 40 (h) of the Bankruptcy Act 1898, "that the bankrupt has on any previous occasion been adjudged bankrupt or insolvent," and those in sec. 40 (r), "that the bankrupt has while an uncertificated bankrupt or insolvent obtained credit," &., apply only to persons adjudged bankrupt or insolvent under the laws from time to time in force in respect to bankruptcy and insolvency in New South Wales, and to persons who have become bankrupt or insolvent under such laws, and have not obtained certificates of discharge thereunder.

From this decision White appealed to the Supreme Court, and the appeal was heard by Simpson C.J. in Eq., who allowed the appeal, and ordered the matter to be referred back to the Registrar with a…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Morgan v White

Details

AGLC: Morgan v White [1912] HCA 50
Case: [1912] HCA 50
Decision Date: 12 August 1912

CaseChat Overview and Summary

The appellant, Harry Alfred Morgan, sought a certificate of discharge from bankruptcy. The respondent, Frederick Gilbert White, a creditor, objected to the discharge on two grounds. The first objection concerned a prior bankruptcy of the appellant in Western Australia, where his estate did not yield ten shillings in the pound and his creditors did not certify the bankruptcy as solely due to misfortune. The second objection alleged that the appellant, while an uncertificated bankrupt, obtained credit exceeding £20 from the respondent without disclosing his bankrupt status. The Registrar in Bankruptcy dismissed these objections, holding that the relevant provisions of the *Bankruptcy Act 1898* (NSW) applied only to bankruptcies and insolvencies within New South Wales. The Supreme Court of New South Wales, on appeal, reversed this decision, directing the Registrar to consider the Western Australian bankruptcy. Morgan then appealed to the High Court of Australia.

The High Court was required to determine whether sections 40(h) and 40(r) of the *Bankruptcy Act 1898* (NSW) applied to prior bankruptcies or insolvencies occurring outside of New South Wales. Specifically, the Court had to consider whether the phrase "on any previous occasion been adjudged bankrupt or insolvent" in section 40(h) and the phrase "while an uncertificated bankrupt or insolvent" in section 40(r) were intended to have a purely territorial operation within New South Wales, or if they encompassed adjudications and bankrupt statuses from other jurisdictions, such as Western Australia.

The High Court, in allowing the appeal, held that the provisions of section 40(h) and 40(r) of the *Bankruptcy Act 1898* (NSW) were intended to apply only to bankruptcies and insolvencies that occurred within New South Wales. The Court reasoned that legislation is presumed to have a territorial operation unless expressly stated otherwise, and that the language and context of the Act indicated a focus on domestic proceedings. The Court noted that where the legislature intended to include extraterritorial matters, it had done so explicitly in other sections of the Act. Furthermore, the practical difficulties and potential for injustice in applying the qualifications and requirements of section 40(h) to foreign bankruptcies, such as obtaining creditor certifications or verifying foreign court proceedings, supported a narrower, territorial interpretation. The Court also considered that the provisions regarding the refusal or suspension of a discharge were not penal in nature but rather concerned the bankrupt's fitness to trade, reinforcing the territorial limitation.

The appeal was allowed, the order of the Supreme Court was discharged, and the order of the Registrar was restored. The respondent was ordered to pay the costs of the appeal.

Orders