Re: Brownlee

[1988] FCA 863

IN THE FEDERAL COURT OF AUSTRALIA )

)

NEW SOUTH WALES DISTRICT REGISTRY ) Nos. P1666 of 1987
)

DIVISION	GENERAL	)
RE :  R.A. BROWNLEE
EX PARTE: AGC (ADVANCES)LIMITED

EX-TEMPORE REASONS FOR JUDGMENT

BURCHETT J.

In this matter an authority under 6.188 of the

Bankruptcy Act (1966) was signed by the debtor on 14 September

1987, but was not then consented to by Mr Staff, the controlling

trustee named in it. He delayed dealing with it because the

debtor failed to provide for	his fees.	These having been paid,
on 14 December	1987 he signed a	consent to exercise the powers

conferred by the authority.

A meeting of creditors of the debtor was thereupon

called, and called duly	so far as all formalities are concerned
apart from the fact that the	20 days period specified in s,194(1)
fixed by s.194(1).
had,already expired, together with a meeting of creditors of	the
debtor's	husband, and a meeting of their joint creditors. At the
meeting, a composition was approved which involves the	payment by
a business as.sociate of the debtor's	husband to the trustee of

the sum of $50,000. The trustee now asks me to extend the time

In Re Gowing; ex parte Deputy Registrar in Bankruptcy

(1985) 11 FCR 111, followed in Re Ringuet ex parte Knight (1986)

11 FCR 45, the power of the court to extend this time, even after

its expiry, was affirmed. The question is how I should exercise

my discretion. For the trustee, it is put that the problem
arises from a pure oversight, since the authority (not being in
effect - see section 188(2) - before the trustee consented to it)
could have been re-executed in December, and no-one could have

complained. That this is true was not contested. The opposing

creditor, AGC (Advances) Limited, relied on the terms of	s.194,
and on certain alleged problems	in connection with the acceptance

by the meeting of the compromise upon which it resolved.

Although the creditor had filed a cross-application, I

was told at the b ginning of the aring that i s

cross-application was based only on the non-compliance with the

time fixed by section 194. In those circumstances, the applicant

had no proper notice of the matters now sought to be relied on in

argument.	In any case, I am not satisfied anything has been
shown which should deny the applicant the relief which I	would
otherwise grant in this situation.

I think I should exercise my discretion in favour of the

applicant trustee.	I extend the time to and including the date
of the meeting.

It seems to me the circumstances are very special. The

creditor asks for an order for its costs on the basis that an

indulgence was sought by the trustee. It was accepted in

argument that the consequences of that would be to diminish the

fund available to the general body of creditors, who have in no

way contributed to the problem, and can only in a very indirect

sense be said to be seeking an indulgence. The basis on which I

1

have made the order extending time is itself rather special, and -.r

was made quite clear by the affidavits which were filed in c. ..

support of the application. In all the circumstances, I think .< .

the proper order is that there be no order as to the costs of any

party. I so order.

I certify that this and the

preceding two ( 2 ) pages are a
true copy of the Reasons for

Judgment herein of his Honour

Justice Burchett.

Associate

Solicitor for the Debtor:  Mr J.P. Pope

Counsel for the Creditor:	Mr P.H. Blackburn-Hart
Solicitors for the Creditor:	Messrs Clayton Utz
Counsel for the Trustee:	Mr J.K. Chippindall

Date of hearing: 31 May 1988