Re Devy; ex parte BBC Hardware Ltd

In this case, BBC Hardware Limited, a creditor, sought leave to withdraw from a bankruptcy petition against Andrew Laurence Devy. The court allowed the substitution of Ms. S. Gurnsy, a solicitor, as the petitioning creditor. Ms. Gurnsy claimed that she had been instructed by the debtor to act on his behalf, and that he had provided a cheque for $600 to cover her outlays. However, the cheque was dishonoured, and the debtor had not provided a bill of costs in taxable form. The central issue was whether Ms. Gurnsy could succeed in her petition under these circumstances.

The court examined whether Ms. Gurnsy had shown that there was a debt owed by the debtor to her which was a liquidated sum and payable immediately or at a certain future time within the meaning of s 44(1) of the Bankruptcy Act 1966 (Cth). The court considered the provisions of s 22 of the Costs Act 1867 (Qld) and its successor, s 5 of the Legal Profession Act 1995 (Qld), which require a solicitor to send a bill of costs to the client before commencing or maintaining an action for recovery. The court noted that there was no evidence that such a bill had been sent to the debtor. However, the court emphasized that the lack of a bill did not mean that no amount was payable to the solicitor, nor that the solicitor's costs were not of a liquidated amount.

The court further examined whether the costs claim was unliquidated due to the necessity of court intervention for taxation of the costs. The court rejected this argument, stating that a claim for costs, even if it required court intervention to quantify, was not a claim for an unliquidated sum. The critical question was whether the claim was payable immediately upon completion of the work or only when the bill was rendered or the time for taxation had passed. The court concluded that while the debt itself was payable immediately, the right to sue for the debt was barred until a proper bill was rendered and the time for taxation had passed. The court found that Ms. Gurnsy did not have a right to sue at the relevant time, and therefore, she could not be considered a creditor with a liquidated debt payable immediately or at a certain future time.

Consequently, the court dismissed the petition. The court ordered that Ms. Gurnsy pay the costs of BBC Hardware Limited and the debtor, as well as the costs of the hearing.