Re Stephen Richard Luckins Ex Parte Columbia Pictures Industries Inc
[1996] FCA 567
•12 Jul 1996
CATCHWORDS
BANKRUPTCY - Bankruptcy notices - notice failing to specify place for payment within Australia - whether duty upon debtor to make payment beyond territorial limits of the Commonwealth - foreign creditor to give as its address a place within Australia where agent will receive payment - no agent within Australia nominated - evidence that Australian resident could pay debt owing to American corporation - expense and uncertainty involved in the use of international banking facilities - bankruptcy notice invalid
Bankruptcy Act 1966, ss.41(1), 41(2)(a)
Re Martin; Ex parte Government Employees Finance and Industrial Loan Corporation (1969) 13 FLR 353 applied
In re A Debtor [1912] 1 KB 53 considered
Re A Debtor [1911] 2 KB 718 considered
James v Federal Commissioner of taxation (1955) 93 CLR 631 distinguished
Re Buchanan; Ex parte Mervac Finance Limited (1991) 31 FCR 135 considered
Re Haritos; Ex parte Hill (1968) 15 FLR 378 considered
BANKRUPTCY - Bankruptcy notices - final judgment or final order - power of Registrar to "draw up, sign and seal" orders under O.62, r.45 of the Federal Court Rules - whether such process merely "a part of the record of proceedings" which lack finality - Registrar's order a "speaking" order - reference to extrinsic material unnecessary - order a "final" order
Federal Court Rules, O.62, r.45(3)
Wilmot v Buckley (1984) 2 FCR 540 distinguished
Re Cartwright; Ex parte Cartwright v Barker [1975] 1 WLR 573 distinguished
STEPHEN RICHARD LUCKINS; EX PARTE COLUMBIA PICTURES INDUSTRIES INC. and TRISTAR PICTURES INC.
No. NP 138 of 1996
BEAUMONT J.
12 JULY 1996
SYDNEY
IN THE FEDERAL COURT OF BANKRUPTCY )
)
BANKRUPTCY DISTRICT OF THE ) No. NP 138 of 1996
)
STATE OF NEW SOUTH WALES )
RE:STEPHEN RICHARD LUCKINS
Debtor
EX PARTE:COLUMBIA PICTURES INDUSTRIES INC AND
TRISTAR PICTURES INC
Creditors
CORAM: Beaumont J.
PLACE: Sydney
DATE: 12 July 1996
MINUTES OF ORDER
THE COURT ORDERS:
Declare that the subject bankruptcy notice is invalid.
Petition dismissed.
Order that the petitioning creditors pay two-thirds of the debtor's costs of the proceedings.
Note:Settlement and entry of orders is dealt with in rule 124 of the Bankruptcy Rules.
IN THE FEDERAL COURT OF BANKRUPTCY )
)
BANKRUPTCY DISTRICT OF THE ) No. NP 138 of 1996
)
STATE OF NEW SOUTH WALES )
RE:STEPHEN RICHARD LUCKINS
Debtor
EX PARTE:COLUMBIA PICTURES INDUSTRIES INC AND
TRISTAR PICTURES INC
Creditors
CORAM: Beaumont J.
DATE: 12 July 1996
REASONS FOR JUDGMENT
INTRODUCTION
On the hearing of a creditors' petition for a sequestration order in respect of the estate of the debtor, a question has arisen as to the validity of the bankruptcy notice now relied on by the creditors. Although no formal order has been made to the effect that the issue of the validity of the notice be determined as a separate question, the matter has gone forward on the footing that I should deal with this aspect of the proceedings by making a declaration as to the validity, or otherwise, of the notice, and such consequential orders or directions as may be appropriate in the circumstances.
BACKGROUND
To place the issues in context, reference should be made to the background, none of which is contentious, as follows:
In 1993, the creditors instituted other proceedings against the debtor in this Court alleging infringement of copyright. On 12 April 1995, Hill J. enjoined the debtor from infringing the copyright and ordered the payment of damages for infringement and for conversion. On 21 April 1995, Hill J. ordered the debtor "to pay the costs of and associated with the application on an indemnity basis, not including the costs of the U.S. in-house lawyers".
The creditors' costs were estimated, in accordance with O.62 r.46(3), in the sum of $60,965.93. This estimate was notified to the parties, but no notice or objection was filed. On 21 September 1995, a certificate of taxation in that amount was issued, allowing the creditors' costs. On 6 October 1995, the certificate of taxation was served, but no payment was made by the debtor. By order dated 26 October 1995, signed and sealed by a Deputy District Registrar, all of the foregoing was recited, and it was then stated that -
"The Court pursuant to Order 62 Rule 45(3) of the Federal Court Rules, thereby orders that:
The [debtor] pay the sum of sixty thousand nine hundred and sixty-five dollars and ninety three cents ($60,965.93) to the [creditors]."
Order 62 r.45(3) provides as follows:
"If, after 14 days from the date of service of the certificate of taxation, the costs remain unpaid then the Registrar shall, at the request of the party in whose favour the costs are awarded draw up sign and seal an order in favour of that party for the sum shown in the certificate of taxation and
enter the same."
In November 1995, the creditors applied to the Court for the issue of a bankruptcy notice, then producing the order dated 26 October 1995.
The bankruptcy notice which was issued, dated 7 November 1995, was relevantly in these terms:
"TO:STEPHEN RICHARD LUCKINS of 209-211 Glenhuntly Road, Elsternwick in the State of Victoria, Video Retailer.
WHEREAS:COLUMBIA PICTURES INDUSTRIES INC. of Sony Pictures Plaza, 10202 West Washington Boulevard, Culver City in the United States of America and TRISTAR PICTURES INC. of Sony Pictures Plaza, 10202 West Washington Boulevard, Culver City in the United States of America hereinafter referred to as `the judgment creditors' have claimed that the sum of $60,965.93 is due by you to them under a final order obtained by them against you in the Federal Court of Australia on the 26th day of October, 1995, being an order the execution of which has not been stayed:
THEREFORE TAKE NOTICE that within 28 days after service of this notice on you, excluding the day on which this notice is served on you, you are required:-
(a)to pay the sum of $60,965.93 so claimed by the judgment creditor to the judgment creditor; or
(b)to secure the payment of the sum referred to in paragraph (a) to the satisfaction of the Federal Court of Australia or the judgment creditor or compound the sum so specified to the satisfaction of the judgment creditors:
... "
THE DEBTOR'S CONTENTIONS
On behalf of the debtor, it is contended that the notice was bad for two reasons: (1) The notice failed to specify a place for payment within Australia by not giving an address for the creditors within the jurisdiction. (2) The notice did not refer to the judgment or order giving rise to the relevant liability.
It will be convenient to consider these arguments separately.
THE PLACE FOR PAYMENT ISSUE
By s.41(1) of the Bankruptcy Act 1966 ("the Act") a bankruptcy notice shall be in the prescribed form. By s.41(2)(a) the prescribed form shall be such that the notice requires the debtor within the time specified: (i) to pay the judgment debt or sum ordered to be paid "in accordance with the judgment or order"; or (ii) to secure its payment to the satisfaction of the Court or of the creditor or his agent, if any, specified in the notice, or to compound it to the satisfaction of the creditor or his agent, if any, specified in the notice. Rule 8 of the Bankruptcy Rules prescribes the form 4 notice. Form 4 requires the debtor -
"(a)to pay the sum of $ so claimed by the judgment creditor to (here insert 'the judgment creditor' or, if the judgment or order
requires payment to be made to a court or a person other than the judgment creditor, the name and address of the court or the other person to whom payment is required to be made); or
(b)to secure the payment of the sum referred to in paragraph (a) to the satisfaction of the (name of the Court) or the judgment creditor (or his agent whose name and address are
) or compound the sum so specified to the satisfaction of the judgment creditor (or his agent) ..."
It will be recalled that the recitals in the notice described the creditors as -
"COLUMBIA PICTURES INDUSTRIES INC. of Sony Pictures Plaza, 10202 West Washington Boulevard, Culver City in the United States of America, and TRISTAR PICTURES INC. of Sony Pictures Plaza, 10202 West Washington Boulevard, Culver City in the United States of America"
It will further be remembered that the notice required the debtor to pay the sum to the creditors; or to secure its payment to the satisfaction of this Court or of the creditors, or to compound it to the creditors' satisfaction; that is, no agent was nominated to act for the creditors.
On behalf of the debtor, reliance is placed upon In re A Debtor [1912] 1 KB 53. There, a French firm obtained a judgment against an English resident and served a bankruptcy notice upon him requiring him to pay the amount to the creditors or one or either of them carrying on business at the address of the firm in Paris. It was held that the notice was bad, since it required the debtor to pay the judgment debt without the jurisdiction of the Court and was therefore not "in accordance with the terms of the judgment" as required by the United Kingdom legislation.
Cozens-Hardy M.R. said (at 55):
"Now what was the obligation imposed upon the debtor by that judgment? Was it an obligation to go to Paris and pay the creditors, or was it an obligation merely to pay them if they were within the realm? In my opinion the latter is the true view."
He added (at 56):
"I see, therefore, no reason to doubt that under the obligations of this judgment the debtor was not bound to go to Paris. The creditors must come within the realm, and if they are within the realm, then no doubt the debtor must search them out."
Cozens-Hardy M.R. said (at 57):
"Now can it be said that this bankruptcy notice required payment of the debt `in accordance with the terms of the judgment'? In my opinion it cannot. It interposes a place of payment which is not, according to the common law of this country, a place in which payment could be properly required, namely, Paris, a place which is out of the jurisdiction. I think, therefore, that on that short ground this bankruptcy notice was wrong and cannot be supported, because it does not require the judgment debtor to pay the judgment debt in accordance with the terms of the judgment. The creditors have no right to impose an additional term not, according to the common law of this country, consistent with the judgment which has been pronounced."
In not accepting the suggestion, which was said to flow from the reasoning in Re A Debtor [1911] 2 KB 718 that there were no means by which a foreign creditor could serve a bankruptcy
notice upon his English debtor, he said (at 59):
"I think, therefore, no difficulty whatever need arise in the case of foreign creditors. They have only to say, in the words of the bankruptcy notice, `Pay me the proper amount at some address in London,' and to have at that address a duly constituted and proper agent duly authorized to receive payment on behalf of the plaintiff."
Fletcher Moulton L.J. (at 60-1) and Farwell L.J. (at 62-3) were of the same opinion.
Both the Re a Debtor cases were considered in James v Federal Commissioner of Taxation (1955) 93 CLR 631. Williams, Kitto and Taylor JJ. said (at 642):
"Their Lordships were discussing two bankruptcy notices one of which gave the address of the creditors as `of' an address in Paris and the other the addresses of the creditors as carrying on business in London. Neither notice required the debtor to pay the creditor at a particular place. The remarks were made with reference to the right of a creditor to describe himself as of an address within the realm and to notify the debtor that he could pay the debt there. They held that a foreign creditor would be within the realm for the purpose of the notice, even if he was not there in person during the seven days, provided he had an agent at the address given during this period duly authorized to receive payment. They were not discussing the question whether a judgment creditor could appoint an exclusive place for payment within the realm and refuse a tender of payment elsewhere."
These observations in James' Case were considered by Gibbs J. in Re Martin; Ex parte Government Employees Finance and Industrial Loan Corporation (1969) 13 FLR 353, who said (at 356):
"In my opinion, when a judgment is given in favour of a foreign creditor, although it is right to say that the judgment does not require the debtor to pay the creditor outside Australia, it is wrong to say that the obligation imposed by the judgment is to pay an agent of the creditor within Australia. The truth is that the obligation imposed is to pay the creditor if he is within Australia but presence within Australia by an agent will be sufficient. To require the debtor to pay an agent is therefore not to require him to pay in accordance with the judgment.
On behalf of the petitioning creditor it was submitted, correctly, that in deciding whether a bankruptcy notice requires payment in accordance with the judgment, the test is not how the debtor may discharge his obligation, but how the judgment requires him to discharge it."
In Re Buchanan; Ex parte Mervac Finance Limited (1991) 31 FCR 135, a bankruptcy notice, which gave a London address for the creditor, required the debtor (a) to pay the debt to the creditor or (b) to secure or compound it to the satisfaction of the creditor's agent, a Sydney firm of solicitors. Declaring the notice valid, I said (at 141-2):
"It is true, as the judgment creditor contends, that the notice is in the prescribed form. But the prescribed form does not, in terms, address the possibility that a judgment creditor may be a foreign person. In that event, it is necessary to adapt the prescribed form so as to provide, in the case of payment, for an appropriate method of payment: see Downey v Pryor ... . As the decided cases cited above show, in the case of a foreign corporation, an appropriate method would be to require payment to an agent of the judgment creditor at an address within the Commonwealth.
It may be accepted that no such stipulation was made, in express terms, in par (a) of the notice. But in par (b), the agent and an address were specified. In my opinion, read as whole, the notice makes it reasonably clear, as a matter of necessary implication, that payment made to the agent would constitute compliance with the requirements of the notice. It will be recalled that, in par (b) of the notice, it was stated that the agent had authority to secure the payment of the sum in question or to compound it. It is implicit in the grant of that authority, in my opinion, that the agent also had authority to receive the sum by way of payment in full."
At the end of the notice in the present matter, the following was stated:
"This notice was issued on the application of John Francis Walker, Solicitor for Columbia Pictures Industries, Inc. and Tristar Pictures, Inc. whose address for service is The Argyle Partnership, Level 19, 44 Market Street, Sydney NSW 2000."
However, nothing appears to turn on this. In Re Haritos; Ex parte Hill (1968) 15 FLR 378, Gibbs J. held that this does not amount to the specification of the solicitor as the agent of a creditor for present purposes (see also Re St. Leon; Ex parte National Australia Bank Ltd. (1994) 54 FCR 371; and Re Christianos; Ex parte Kennedy, unreported, Federal Court, 10 April 1996).
On behalf of the creditors, it is submitted that Re a Debtor is "outmoded and is no longer good law as a matter of general application". Reliance is placed by the creditors upon the reasoning, said to be analogous, in Pepper v McNiece (1941) 64 CLR 642. It was there held that a bankruptcy notice founded on an order of a Court of Petty Sessions in New South Wales was not invalid because it specified as the creditor's address a place outside the State but within Australia.
McTiernan J. said (at 652):
"Another objection is that the bankruptcy notice was bad because it did not specify an address within the jurisdiction of the Court of Petty Sessions. The jurisdiction, it was contended, did not extend beyond the territorial limits of New South Wales. In my opinion there is no substance in this objection. The territorial unit for the purposes of the Commonwealth Bankruptcy Act must be as extensive at least as the territorial limits of the Commonwealth. Sec. 53 provides that a bankruptcy notice shall be in the prescribed form. The form, as has been observed, is prescribed by rule 144. Pursuant to these requirements the applicants were stated to be of `91 Princes Street, Sandy Bay, Hobart.' Whether these words are to be regarded as descriptive of them as the judgment creditors or as the place at which payment was to be made, it is enough to say that the words designate a place within the Commonwealth. The fact that they describe a place outside of New South Wales, the State to which the Petty Sessions Court belongs, is not in itself an invalidating circumstance."
[Emphasis added]
On behalf of the creditors, it is said that the reference by his Honour to "at least" the limits of this country indicates that the extra-territorial performance of the debtor's obligation to pay may be contemplated.
Williams J., referring to In Re A Debtor [1912] 1 KB 53, said (at 655):
"But the foundation of the decision was that, where a bankruptcy notice issues in respect of a judgment debt of an English Court, the debtor must be given an opportunity to pay the debt within the realm before he can make default and thereby commit an act of bankruptcy. The principle of the decision must be adapted to the different conditions in Australia due to Federation. The process of the New-South-Wales Court of Petty Sessions does in substance and actuality run in all the States of the Commonwealth, by reason of sec.21 of the Federal Service and Execution of Process Act 1901-1934, which enables the successful party to register a certificate of the order in the other States, and so enforce it there. Moreover, the validity of the notice can be upheld on the broader ground that it is a notice which issues out of the Federal Court of Bankruptcy and can be served anywhere in the Commonwealth without leave. As the Commonwealth currency is legal tender in all the States no difficulty would be experienced by a resident of one State in paying a creditor in any other. Sec. 53 provides that a bankruptcy notice shall be in the prescribed form. This form is No. 5 of the First Schedule to the Rules. Assuming the words which it contains, `you must pay to C D of ,' indicate a requirement that the address to be inserted should be one at which payment should be made, there is no reason from the point of view of principle or convenience why the address should not be anywhere in the Commonwealth. This ground therefore fails."
[Emphasis added]
The creditors also rely upon the following further observations of Williams, Kitto and Taylor JJ. in James' Case (at 639):
"We are here concerned with an order that the plaintiff shall pay the costs to the defendants. It does not provide that the plaintiff must pay the costs to the defendants to any particular place as the bankruptcy notice does. But the prescribed form simply directs the debtor to pay the debt to the creditor `of'. Unless the judgment or order does so the notice should not require the debtor to pay the creditor at a particular place. It is the duty of a debtor to seek out the judgment creditor and pay the judgment debt to the creditor if he is in Australia. The debtor has the correlative right to pay the creditor wherever he can find him so that a debtor could be seriously prejudiced if he was led to believe that he was bound to pay the creditor at one particular place. The objection is not a trifling one particularly in a large geographical area like Australia. It is one of substance. If a judgment creditor can direct payment at one place exclusively it means that, although he and the debtor reside or carry on business in the same vicinity, the creditor can require the debtor to seek him or his agent out
in some remote part of the realm. The defect in the present bankruptcy notice is that it directs the debtor that he must pay the creditors at a certain address. Such a direction could only be in accordance with a judgment or order if the judgment or order directed payment at that particular address." [Emphasis added]
In support of their argument, the creditors call in aid the evidence of a banker, Mr. J.V. Micallef, who had had particular experience in international banking. In his affidavit, Mr. Micallef said:
" ...
I have personal knowledge of three (3) different ways that an Australian resident could pay a debt owing to a United States Corporation in the United States of America.
Firstly, money could be sent by telegraphic transfer to a foreign bank account. This service would cost approximately A$35.00 and the money would be available to the US creditor usually within twenty-four (24) hours.
Secondly, the debtor could purchase a foreign currency draft payable in US dollars from a bank branch. This would cost approximately A$15.00. The foreign currency draft could then be forwarded either by mail or by courier direct to the US Corporation.
Thirdly, the debtor could send a cheque payable in Australian dollars direct to the creditor in the USA. The creditor would then take the cheque to his/her local bank who would then send the cheque back to Australia on a collection basis and request final payment. The Australian bank would then forward it to the drawing branch to clear the cheque and the US bank would then be credited. It would take up to two (2) months for the cheque to clear.
In my experience it is not usual for cheques payable in Australian dollars to be sent overseas however, it is common enough that all major banks would have a system in place to deal with the situation."
CONCLUSION ON THE PLACE FOR PAYMENT ISSUE
I have difficulty accepting any of the creditors' arguments.
In the first place, the present case appears to be indistinguishable in principle from Re Martin. The observations there made by Gibbs J. that in the notice a foreign creditor should give as its address a place in Australia at which there is in fact a person duly authorised to receive payment, has never been criticised, so far as I am aware. Indeed, Re Martin was recently followed by Cooper J. in Re Barnes; Ex parte Barnes v Makhoul (1994) 53 FCR 169. Certainly, there is nothing in the decisions of the High Court in this area which contradicts what was said in Martin. The point of distinction between Re Buchanan and Re Martin was, as has been seen, that in Buchanan the creditor nominated an agent for some purposes. But there was no such nomination in the present case.
Secondly, the observations made in Pepper v McNiece and in James' Case were clearly confined to their context, which was the territorial limits of this country. It is a very different thing to suggest that those comments may be applied extra-territorially.
For the purpose of considering the application of an enactment, an omission to act is, unless the contrary intention appears, to be treated as taking place in the territory where the act ought to have been performed. Applying this test, an omission may fall to be treated as occurring in each of two or more territories. As Bennion, in his work on Statutory Interpretation (1984) says (at 509):
"The principle that an omission is to be treated as taking place where the act in question should have been performed is a matter of common sense... . Where it would have sufficed to perform the act in any of two or more territories, it follows that the omission must be treated as having taken place in all of them."
Thus, in Brinkibon Ltd. v Stahag Stahl [1983] 2 AC 34, Lord Wilberforce said (at 43):
"Each of these acts should have been performed outside the jurisdiction and failure to do them must be similarly located."
But whilst this debtor had the right to pay the judgment debt in the United States, he had no duty to pay it there. His only obligation was to pay in Australia.
The availability of the international banking facilities described by Mr. Micallef cannot, in my view, alter that duty. In any event, whilst it may be possible to imply contractual terms in this type of context, the strict application of the bankruptcy laws, in particular the penal character of a bankruptcy notice, is another matter: it will be recalled that additional expense was involved in using a particular facility; and in all of the methods available, there were areas of uncertainty in nominating a definite time at which payment was deemed to have taken place - a crucial element of the operation of a bankruptcy notice.
For these reasons, both of principle and of a practical kind, the approach taken in Re Martin should continue to be applied. It must follow that, on this ground alone, in my view, the bankruptcy notice was not valid.
THE IDENTIFICATION OF THE ORDER ISSUE
This issue was fully argued and will be considered, notwithstanding that it is not strictly necessary to do so.
It will be recalled that, in the notice, it was stated that the creditors "claimed that the sum of $60,965.93 is due ... under a final order obtained ... in [this] Court on the 26th day of October, 1995 ..."; and that the order dated 26 October 1995, signed and sealed by the Deputy Registrar pursuant to O.62 r.45(3), was a "speaking" order in the sense that it recited the history of this aspect of the matter in a way that made its meaning immediately plain; that is, the terms of the order spoke for themselves, so that it was not necessary to refer to any extrinsic material in order to understand the position (see, e.g. Repatriation Commission v Nation (1995) 57 FCR 25 at 33).
On behalf of the debtor, it is submitted that although O.62 r.45 describes the manner in which the Registrar may draw up, sign and seal an order in favour of a successful party after service of a certificate of taxation, nonetheless this process is, the argument runs, merely "a part of the record of the proceedings to be read with the judgment or decree" in the sense explained in Wilmot v Buckley (1984) 2 FCR 540 at 542-43); so that, it is said, the judgment or order relied on as giving rise to the relevant liability is not properly identified.
In Wilmot v Buckley, the bankruptcy notice, which was held to be bad, stated that the creditors claimed that an amount was "due ... under a Certificate of Taxation [then specified]... ."
In Wilmot v Buckley, as here, reliance was placed by the debtor in challenging the notice upon Re Cartwright; Ex parte Cartwright v Barker [1975] 1 WLR 573. In Cartwright, a petitioning creditor founded proceedings in bankruptcy on the failure by two joint debtors to comply with a bankruptcy notice which specified the debt claimed as being "the amount due on a final judgment or order obtained by (the petitioning creditor) against you (the joint debtors) in the High Court of Justice dated 20 March 1974, whereon execution has not been stayed". In fact, the amount claimed was the sum certified by the taxing master on 20 March 1974, as being the net amount of costs owing to the petitioning creditor under a judgment obtained by him against the debtors on 5 November 1970 in the High Court. It was held that the bankruptcy notice was bad in that it did not show under what judgment or order the sum claimed was due and also because it did not, in accordance with the requirements of s.2 of the Bankruptcy Act 1914, require the sum to be paid in accordance with the terms of the judgment or order; and that in the case of costs the effective judgment was the order of the court itself, not the certificate quantifying their amount.
It appears that in Wilmot no formal judgment had been entered. I said (at 543):
"But, in the present case, there is no evidence that a formal judgment has been drawn up. The circumstance that only the judge's notes were tendered leads to the inference that, in all probability, that order has not been taken out. Although it be unnecessary to have two judgments entered, in the present case there is none. It may be, as the respondents submit, that Cartwright's case could be distinguished for present purposes because there, the notice wrongly suggested in its terms that the certificate of taxation constituted the relevant judgment. That particular feature is not present here. Nonetheless, in my view, whilst not explicitly misleading, the notice is implicitly so. I think that, by describing the respondents as `judgment creditors' and referring to the amount claimed as due under the certificate of taxation, the notice could be construed as suggesting, at least by implication, that the certificate of taxation was the source of the applicant's liability and that the certificate was a judgment.
In my opinion, to convey that impression would be capable of misleading a debtor and the case would fall squarely within the reasoning in Cartwright's case. Alternatively, even if that impression is not conveyed by the notice, it is still invalid because it fails to identify the final judgment or order upon which it is based. That was the order made on 19 July 1982 and this order is not mentioned in the notice."
CONCLUSION ON THE IDENTIFICATION OF THE ORDER ISSUE
In my view, the reasoning in Wilmot may be distinguished for present purposes. Here, there were two formal judgments, the first by which Hill J. ordered the payment of costs, as it were "in principle"; and the second by which the Registrar, pursuant to O.62 r.45(3), ordered the payment of costs in a specific sum, by quantifying the operation of Hill J.'s order. The Registrar's order was, as has been noted, one which "spoke", so that there could not be scope for any misunderstanding.
As has been said, reliance has also been placed by the debtor upon Cartwright. Reference is made in this connection to O.35 r.3, which provides that a judgment or order "shall take effect on the date on which it is pronounced or made, unless the Court orders that it take effect at an earlier or later date".
In Cartwright, Goulding J. said (at 576-7):
"In my judgment it is clear that the certificate of March 20, 1974, is not a final judgment or order. It is not in any sense an order for the payment of a sum of money. The order is that of the court dated November 5, 1970. In order to issue execution upon it it would be necessary to produce both the order of November 5, 1970, and the taxing master's certificate, or possibly to have the amount of costs found due by the certificate endorsed on the order of November 5, 1970, itself by procedure similar to that considered in In re Crump, Ex parte Crump (1891) 64 L.T. 799. Thus the bankruptcy notice is not in my view in accordance with the prescribed form because it does not show under what judgment or order the sum is due, and it is not in accordance with section 2 of the Bankruptcy Act 1914 because it does not require the sum to be paid in accordance with the terms of the judgment or order.
Two decisions of the Court of Appeal were cited by counsel to persuade us to a different view of the bankruptcy notice. One was In re Faithfull, Ex parte Moore (1885) 14 Q.B.D. 627 and the other was In re Alexander, Ex parte Alexander [1892] 1 Q.B. 216. Those decisions appear to me to be rather against than for counsel's argument on this branch of his contentions. They show to my mind quite clearly that in the case of costs the effective judgment is the decree of the court itself ordering costs to be paid, not the certificate quantifying them at a given figure. Accordingly, the relevant judgment or order for the purpose of a bankruptcy notice is the former, though no doubt the latter may have to be referred to in order to specify the sum."
But in the present case, the Registrar's order was, by virtue of the provisions of O.62 r.45(3), an order in its own right; and as Drummond J. held in Re Stubberfield; Ex parte Paradise Grove Pty. Ltd. (1995) 134 ALR 169 (at 177) was a "final" order for the purposes of the Act (see also Re Gibbs; Ex parte Triscott (1995) 133 ALR 718; Re Thompson; Ex parte Thompson v Grimley Pty. Ltd. (1995) 135 ALR 700 per Spender J. at 706).
Moreover, I cannot see how O.35 r.3 is presently significant. There are here two orders, each operating from their respective dates.
This ground of objection to the notice fails.
ORDERS AND COSTS
There will be a declaration that the notice is invalid. Accordingly, the petition will be dismissed. As to costs, in order to reflect the facts that the debtor failed in his second objection to the notice, but succeeded overall, the debtor should receive two-thirds of his costs of the proceedings.
I certify that this and the preceding nineteen (19) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Beaumont.
Associate
Dated: 12 July 1996
Counsel and Solicitors Mr. A. Spencer, instructed by
for Debtor:Irlicht and Broberg
Counsel and Solicitors Mr. B. Skinner, instructed by
for Creditors: The Argyle Partnership
Date of hearing: 14 June 1996
Date Judgment delivered: 12 July 1996
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