Re Crisafulli; ex parte National Commercial Banking Corporation of Australia Ltd

[1985] FCA 299

Re: GERRARD GRAEME CRISAFULLI
Ex Parte: NATIONAL COMMERCIAL BANKING CORPORATION OF AUSTRALIA LIMITED
No. P 108 of 1985
Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
BANKRUPTCY DISTRICT
OF THE STATE OF
WESTERN AUSTRALIA
Toohey J.

CATCHWORDS

Bankruptcy - creditor s petition - change of name of corporate judgment creditor prior to issue of bankruptcy notice - whether notice invalid - test to be applied - likelihood of debtor being misled - effect of provision in Companies (Western Australia) Code relating to change of name

Bankruptcy Act 1966

Companies (Western Australia) Code sub-s.65(1)

HEARING

PERTH
#DATE 8:7:1985

ORDER

The petitition be adjourned until 22 July 1985 at 10 a.m.

JUDGE1

This a petition for a sequestration order against the estate of Gerrard Graeme Crisafulli.

1. The act of bankruptcy relied on is a judgment of the District Court of Western Australia obtained against Mr Crisafulli by National Commercial Banking Corporation of Australia Limited ("the judgment creditor") on 18 January 1984. On 21 November 1984 the judgment creditor requested the issue of a bankruptcy notice; a notice issued that day. On 1 October 1984, that is after judgment had been obtained but before issue of the bankruptcy notice, the judgment creditor (which had originally been called The National Bank of Australasia Limited) changed its name from National Commercial Banking Corporation of Australia Limited to National Australia Bank Limited. No reference was made in the bankruptcy notice or indeed in the petition to the new name of the company.

2. The petition came on for hearing before the Court on 10 June 1985. The judgment creditor was represented by counsel; the debtor appeared in person. Earlier that day Eric Noel Peterson, a bank manager of the judgment creditor, swore an affidavit that the company had changed its name under sub-s.65(1) of the Companies (Western Australia) Code to National Australia Bank Limited. At a preliminary hearing that morning the Registrar raised with the parties the implications of a change of name made before the issue of the bankruptcy notice but to which no reference had been made in the notice. The matter was mentioned when the petition came before me later that morning. Mr Crisafulli said that he had been confused by the failure of the judgment creditor to alert him to its change of name. In view of the decision of Beaumont J. in Re Hansen; Ex parte Hansen v. Mortgage Guaranty Insurance Corporation of Australia Ltd. (unreported decision, delivered 4 March 1985), I adjourned the hearing of the petition to the next bankruptcy sittings to give the judgment creditor a chance to assess its position. The matter came before me again on 24 June when counsel for the petitioner submitted that the bankruptcy notice was valid, that Re Hansen was distinguishable and that a sequestration order should be made. Since there was no one to present a contrary view, I reserved my decision until the next bankruptcy sittings to consider the relevant authorities. This is my decision.

3. It must be appreciated that the name of the judgment creditor has remained constant in the material before the court, at least until Mr Peterson's affidavit. The question therefore must be - was the bankruptcy notice misleading in reciting, as the name of the judgment creditor, a name which had been changed? The relevant principle has been expressed in this way:
   
   

"The court cannot inquire whether the debtor has in fact been misled or not. In this case it is probable that he was not misled. It is sufficient that he could be misled. But strict compliance with the requisites of a bankruptcy notice is essential to its validity ...". (James v. Federal Commissioner of Taxation (1955) 93 CLR 631 at p 644)

1. In Re Hansen a bankruptcy notice was issued in the name of Mortgage Guaranty Insurance Corporation of Australia Limited although, before the issue of the bankruptcy notice and indeed before the judgment upon which the notice was founded, the creditor had changed its name to MGICA Limited. The latter name was fixed outside the company's principal office and was displayed on the tenants' directory of the building occupied by the company. Following the issue of a bankruptcy notice, a solicitor for the judgment debtor attempted to seek out the judgment creditor at the address shown on the bankruptcy notice but was unsuccessful because only the name MGICA Limited appeared at the building. The solicitor did not connect the two names. In the view of Beaumont J. at p.9:
   
   

"... the correct manner of description of the judgment creditor for the purposes of the bankruptcy notice is 'M.G.I.C.A. Limited (formerly known as Mortgage Guaranty Insurance Corporation of Australia Limited)' or words to that effect (cf. Re Wheelahan; Ex parte Commissioners of the State Bank of Victoria (1981) 58 FLR 91 at p 95).

Unless some such description of the judgment creditor were made in the bankruptcy notice, the judgment debtor could, in my view, be misled as to the identity of the judgment creditor for the purposes of complying with the requirements of the notice. It should be noted that there is no room for any suggestion that the judgment debtor was aware of the change of name from extraneous sources (cf. Re Wimborne; Ex parte The Debtor (1979) 24 ALR 494 per Lockhart J. at p 500)".

1. Later in his reasons for judgment, Beaumont J. said at pp.10-11:
   
   

"In my opinion, it is essential to the validity of a bankruptcy notice that the judgment debtor be in no reasonable doubt as to the identity of the judgment creditor. In the present case, the judgment creditor was identified by a name which it had abandoned some considerable time previously. That name was quite different from the name of the judgment creditor at the time of issue of the bankruptcy notice and the judgment debtor could hardly be expected to connect the two corporate names. The judgment debtor could thus have been misled as to the identity of the party with whom he had to deal in order to comply with the requirements of the bankruptcy notice. The notice was accordingly defective (cf. Re Gray; Ex parte Person to Person Financial Services Pty. Ltd.

(1980) 48 FLR 379 per Lockhart J. at p.382)."

1. Whether Mr Crisafulli was misled in fact is not the question. That is "an impermissible field of inquiry"; it is "the capacity of the bankruptcy notice to mislead the debtor to whom the notice is directed that matters, not some hypothetical debtor" (Re Wimborne at p.500). The judgment creditor has at all material times occupied the same address. During the relevant period it has undergone one change of name, from National Commercial Banking Corporation of Australia Limited to National Australia Bank Limited. In a further affidavit, Mr Peterson deposed to the fact that the change of name of the petitioning creditor "was notoriously well known throughout Australia because of the wide media coverage at the time". He further deposed: "As a result notice of the change would have been given to the debtor in these proceedings". Whether notice was given is not the question but in any event I am of the opinion that Mr Peterson could not properly depose in those terms, the conclusion being at best an inference from the fact that there had been publicity surrounding the change of name.

2. I stress again that this is not a case in which the debtor had dealt with a company by a particular name and then received a bankruptcy notice in a name that was different. Cf. In re Howes; Ex parte Hughes (1892) 2 QB 628. Nor was the notice defective in its contents. Cf. James v. Federal Commissioner of Taxation supra. The distinction between a notice being misleading because of its contents and a notice being misleading because of events that have occurred has not, I think, always been maintained. In this present case the possibility of the debtor being misled could arise only if and when he attempted to take some action pursuant to the bankruptcy notice. In my opinion, given the continued occupancy of the judgment creditor at the same address, the similarity in its name before and after the change and the publicity surrounding the change of names, this is not a case in which the debtor was likely to be misled. In my view, had the question arisen, it is not likely that the debtor would have been in any doubt as to the identity of the company with which he was to deal. If, on receipt of the bankruptcy notice, he had sought to deal with the judgment creditor by letter, telephone or personal approach, there is no reason to think that his use of the company's former name would have presented an obstacle or led to any confusion on his part. In other words, I do not think that the bankruptcy notice was capable of misleading this debtor in the particular circumstances of this case.

3. This is not a case for the application of s.306 of the Bankruptcy Act 1966; there was not a formal defect or an irregularity in the bankruptcy notice because it was issued in the name of the company that obtained the judgment against Mr Crisafulli and was otherwise in accordance with s.41 of the Act. Sub-section 65(5) of s.65 of the Companies Code provides that a change of name of a company does not operate
   
   

(a) ...

(b) to prejudice or affect the identity of the body corporate constituted by the company or its continuity as a body corporate

(c) ...

(d) to render defective any legal proceedings by or against the company."

1. In my view there is no warrant for setting aside the bankruptcy notice. The judgment creditor has established an act of bankruptcy on the part of the debtor and has otherwise established its entitlement to a sequestration order though it needs leave to amend its name in the petition to the name it now possesses.