(2)Set aside the orders of the Supreme Court made on 13 November 2009, and in lieu thereof order that:
(a)the statement of claim be struck out, with liberty to replead up to and including 10 February 2012 and the notice of motion dated 31 July 2009 be otherwise dismissed; and
(b)costs of the motion be costs in the cause.
(3)Respondent to pay the appellant's costs of the appeal.
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:
BANKRUPTCY - vesting of choses in action in Official Trustee upon commencement of bankruptcy per Bankruptcy Act 1966 (Cth), ss 58(1) and 60(2) - whether exception in s 60(4) for bankrupt to maintain in own name actions in respect of personal injuries or wrongs done to bankrupt operative - Beckham v Drake (1849) 2 HLC 579; 9 ER 1213 and Cox v Journeaux (No 2) [1935] HCA 48; 52 CLR 713 considered - action against former solicitor for failure to include in statement of claim a claim for defamation - proper characterisation of claim as loss of chance of successful outcome - proper characterisation of underlying claim against former solicitor as personal injury or wrong done to the bankrupt - bankrupt entitled to maintain action in own name.
STATUTORY INTERPRETATION - Bankruptcy Act 1966 (Cth), ss 60(4) and 116(2)(g)(i).
Legislation Cited:
An Act to amend the Law relating to Bankruptcy and Insolvency in England 1861 (24 & 25 Vict, c 134), s 229 An Act to amend the Laws relating to Bankrupts 1825 (6 Geo IV, c 16), s 1 An Act to establish a Court in Bankruptcy 1831 (1 & 2 Will IV, c 56), ss 1, 22 and 25 Bankruptcy Act 1869 (32 & 33 Vict, c 71), ss 5, 15(1), (2), (3), (4) and (5) Bankruptcy Act 1870 (Tas), s 12 Bankruptcy Act 1883 (46 & 47 Vict, c 52), s 44 Bankruptcy Act 1887 (NSW), s 10(6) Bankruptcy Act 1892 (WA), s 10 Bankruptcy Act 1898 (NSW), s 10(7) Bankruptcy Act 1914 (UK), ss 9 and 38 Bankruptcy Act 1924 (Cth), ss 63(3) and 91 Bankruptcy Act 1966 (Cth), ss 5(1), 27(1), 58, 60(2), 60(4), 116(2)(g)(i) Civil Procedure Act 2005 (NSW), s 67 Debtor's Act 1869 (32 & 33 Vict, c 62) Insolvency Act 1841 (NSW) (5 Vic, No 17 (NSW) 1), s 33 Insolvency Act 1874 (Qld), s 88 Insolvency Act 1915 (Vic), s…
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.
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Details
AGLC
Moss v Eaglestone [2011] NSWCA 404
Case
[2011] NSWCA 404
Decision Date
CaseChat Overview and Summary
The appeal concerned a bankrupt, Mr Eaglestone, who sought to bring an action against his former solicitor, Ms Moss, for negligence. The dispute arose from Ms Moss's alleged failure to include a claim for defamation in a statement of claim in prior proceedings. The primary legal issue before the Court of Appeal was whether Mr Eaglestone, as a bankrupt, was entitled to maintain this action in his own name, or if the cause of action had vested in the Official Trustee in Bankruptcy pursuant to the *Bankruptcy Act 1966* (Cth).
The court was required to determine the proper characterisation of Mr Eaglestone's claim against his former solicitor. Specifically, it needed to ascertain whether the claim constituted a "personal injury or wrong done to the bankrupt" within the meaning of section 60(4) of the *Bankruptcy Act 1966* (Cth), which would permit the bankrupt to maintain the action personally. This involved considering whether the loss of a chance of a successful outcome in the defamation proceedings, due to the solicitor's alleged negligence, fell within the scope of personal injury or wrong.
The Court of Appeal reasoned that the claim against the solicitor should be characterised as a personal wrong done to the bankrupt, rather than a mere chose in action that vested in the Official Trustee. Applying principles derived from cases such as *Beckham v Drake* and *Cox v Journeaux (No 2)*, the court held that a claim for damages arising from a solicitor's negligence in conducting litigation, where the underlying cause of action was personal in nature, was itself a personal wrong. Therefore, Mr Eaglestone was entitled to maintain the action in his own name.
The appeal was allowed, and the orders of the Supreme Court were set aside. The statement of claim was struck out with liberty to replead, and the notice of motion was otherwise dismissed. The respondent was ordered to pay the appellant's costs of the appeal.
Orders
Orders of the court
(1)Appeal allowed.
(2)Set aside the orders of the Supreme Court made on 13 November 2009, and in lieu thereof order that:
(a)the statement of claim be struck out, with liberty to replead up to and including 10 February 2012 and the notice of motion dated 31 July 2009 be otherwise dismissed; and
(b)costs of the motion be costs in the cause.
(3)Respondent to pay the appellant's costs of the appeal.
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]