Re Faulkner; Ex parte Official Receiver

Re: SYLVIA MARGARET FAULKNER
Ex parte: THE OFFICIAL RECEIVER, Trustee of the bankrupt estate of Sylvia
Margaret Faulkner
And: DANIEL JOSEPH NOEL BLUETT, Official Receiver in Bankruptcy for the State
of New South Wales (1981) 52 FLR 109
No. 190 of 1978
Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION
BANKRUPTCY DISTRICT IN THE STATE OF NEW SOUTH WALES AND THE AUSTRALIAN CAPITAL TERRITORY
Lockhart J.(1)

CATCHWORDS

Bankruptcy - application by Official Receiver to elect to proceed with action in High Court commenced by bankrupt prior to her bankruptcy - whether time for making of such election can be extended - whether Official Receiver had abandoned the action - factors to be considered when exercising discretion to extend time

Bankruptcy Act 1966 (Cth.) ss. 33 (1) (c), 60.

Bankruptcy - High Court action commenced by bankrupt before her bankruptcy - application to continue action in her own name - whether action is for damages for personal injury or wrong done to the bankrupt within the meaning of s. 60 (4) (a) and s. 116 (2) (g) - discussion as to history and meaning of those sections.

Bankruptcy Act 1966 (Cth.), ss. 60, 116

Bankruptcy - Bankrupt commenced court proceedings prior to bankruptcy - Election by official receiver to proceed with court action - Time for making election - Extension of time for making election - Abandonment of action by official receiver - Discretion of court in extending time - Principles to be applied - Bankruptcy Act 1966 (Cth), ss. 33 (1)(c), 60.

HEADNOTE

In March 1978 a sequestration order was made against the estate of the bankrupt, who, in 1974, had commenced an action in the High Court against the Commonwealth of Australia and one Brigadier Flint. On 20th September, 1978, notice of the High Court proceedings was served on the official receiver. On 17th October, 1978, Evatt J. ordered that the time to comply with the notice be extended to 1st November, 1978. On 31st October, 1978, the official receiver convened a meeting of creditors who resolved to authorize him to continue the action; the creditors however failed to provide him with any indemnity in respect of costs. Between November 1978 and July 1979 correspondence between the official receiver and the Commonwealth Crown Solicitor ensued, culminating in a letter from the Commonwealth Crown Solicitor stating that the official receiver was deemed to have abandoned the action as he had not prosecuted the same within the time specified in s. 60(3) of the Bankruptcy Act 1966 (the Act).

The official receiver applied pursuant to s. 305 of the Act to the Minister for his approval to the Commonwealth meeting the costs of the High Court action. On 6th March, 1980, approval in this regard was given. In reliance upon s. 33 (1)(c) of the Act the official receiver sought an extension of the time prescribed for making an election pursuant to s. 60(3). In opposition to the application the Commonwealth submitted that the time for making the election…