Storey v Lane

[1981] HCA 47

HIGH COURT OF AUSTRALIA

Gibbs C.J., Mason, Murphy, Aickin, Wilson and Brenna JJ.

STOREY v. LANE

(1981) 147 CLR 549

4 September 1981

Constitutional Law (Cth)

Constitutional Law (Cth)—Bankruptcy and insolvency—Power invested in court of bankruptcy after presentation of petition to discharge from custody person held in consequence of non-payment of provable debt or penalty—Validity—The Constitution (63 &64 Vict. c. 12), s. 51 (xvii)—Bankruptcy Act 1966 (Cth), s. 60 (1).

Decisions

September 4.
The following written judgments were delivered: -
GIBBS C.J. This cause, which has been removed into this Court pursuant to an order made under s. 40 (1) of the Judiciary Act, was commenced by an application made on 14 January 1981 to the Supreme Court of Queensland exercising federal jurisdiction in bankruptcy by Michael Stuart Storey for orders (inter alia) that he be released from prison and discharged from custody, and that any legal process relating to that imprisonment and any further action thereon be stayed. On 1 July 1980, on complaints laid by the respondent, an industrial inspector, the applicant was convicted in the Industrial Magistrate's Court of three offences against the Industrial Conciliation and Arbitration Act, 1961-1976 (Q.) ("the Industrial Act"), namely - (1) paying a lesser amount of wages than that prescribed by the Clerks and Switchboard Attendants' Award (State) during the period 26 February 1979 to 19 October 1979, both dates inclusive, to Patricia Gaye Perring, a clerk employed by him, in breach of the said award; (2) failing to pay holiday pay on the termination of the employment of the said Patricia Gaye Perring, in breach of the said award; and (3) failing to keep a time and wages book or other similar record of all employees who were at any time during the period of twelve months immediately preceding the date of an inspection made on 5 March 1980 in his employment showing particulars of their designation, rate of wages, times of starting and ceasing work and the award under which they were working respectively. The first and second charges were laid under s. 113, and the third under s. 126, of the Industrial Act. On the first charge the applicant was fined $100 plus costs of $18 and was ordered to pay the amount of wages underpaid, namely $2,051.96. It was directed that in default of payment of the total amount of $2,169.96 within twenty-eight days the applicant should be imprisoned for six months. On the second charge the applicant was fined $100 and ordered to pay the amount of holiday pay due and unpaid, namely $716.46, and it was directed that in default of payment of the total amount of $816.46 within twenty-eight days he should be imprisoned for six months, to be cumulative with any other period of imprisonment. The orders for the payment of the moneys due and unpaid to the employee Patricia Gaye Perring were made under s. 97 (5) of the Industrial Act which provides as follows:
"Upon a prosecution of an employer for an offence which involves the non-payment to any employee or employees of any money earned by him or them, or payable to him or them, in respect of work done by him or them, or any holiday or leave by way of annual holidays, sick leave or long service leave, the industrial magistrate shall, in addition to any penalty imposed upon the defendant, order the payment by him of all moneys earned by the employee or employees during any period of employment or, if payable in respect of any holiday or leave as aforesaid, which have become due within the twelve months next preceding the date upon which the prosecution was instituted, and such order for payment shall be in addition to any penalty imposed."
By s. 97 (9), an order made by an industrial magistrate under the section is enforceable as if it were an order made by such industrial magistrate sitting as a court of petty sessions, and the provisions of The Justices Act of 1886 (Q.), as amended, are rendered applicable. Under those provisions, a justice is empowered to direct that a person ordered to pay a sum of money shall be imprisoned in default of payment. On the third charge the applicant was fined $30 and ordered to pay costs of $18, and it was directed that in default of payment within twenty-eight days he should be imprisoned for seven days (to be concurrent). It appears that before the applicant was convicted he had entered into a composition with his creditors, but nothing now turns on that circumstance. The applicant failed to pay any of the fines, costs or other moneys ordered to be paid, and was on 31 December 1980 taken into custody. On the following day he was imprisoned in Her Majesty's Prison, Brisbane. In the meantime, however, on 10 November 1980, the applicant had filed a debtor's petition. He accordingly made the present application to the Supreme Court under s. 60 (1) of the Bankruptcy Act 1966 (Cth), as amended. When the application came before that Court on 14 January 1981 the learned judge raised a doubt as to the validity of s. 60. Subsequently the Attorneys-General for the Commonwealth and the State of Queensland intervened in the proceedings and the respondent was made a party. On 13 February 1981 this Court, on the application of the Attorney-General for the Commonwealth, ordered that the cause be removed into this Court. It was further ordered that the applicant be released from prison and admitted to bail. (at p553)

2. The question that now falls for decision is whether s. 60 (1) of the Bankruptcy Act is a valid law of the Commonwealth. That sub-section, which was inserted in its present form by the Bankruptcy Amendment Act 1980, provides as follows:

"The Court may, at any time after the presentation of a petition, upon such terms and conditions as it thinks fit - (a) discharge an order made, whether before or after the commencement of this sub-section, against the person or property of the debtor under any law relating to the imprisonment of fraudulent debtors and, in a case where the debtor is imprisoned or otherwise held in custody under such a law, discharge the debtor out of custody; or (b) stay any legal process, whether civil or criminal and whether instituted before or after the commencement of this sub-section, against the person or property of the debtor - (i) in respect of the non-payment of a provable debt or of a pecuniary penalty payable in consequence of the non-payment of a provable debt; or (ii) in consequence of his refusal or failure to comply with an order of a court, whether made in civil or criminal proceedings, for the payment of a provable debt, and, in a case where the debtor is imprisoned or otherwise held in custody in consequence of the non-payment of a provable debt or of a pecuniary penalty referred to in sub-paragraph (i) or in consequence of his refusal or failure to comply with an order referred to in sub-paragraph (ii), discharge the debtor out of custody."

In its original form s. 60 (1) empowered the court to: ". . . discharge an order made against the property or person of the debtor under any law relating to the imprisonment of fraudulent debtors and stay any action, execution or other civil legal process against the property or person of the debtor and discharge him out of custody." It was held by this Court in Commissioner for Motor Transport v. Train (1972) 127 CLR 396 that a court of bankruptcy had no power under that sub-section to order the discharge from custody of a person convicted for non-payment of charges under the Road Maintenance (Contribution) Act 1958-1969 (N.S.W.) and ordered, under a power given by that Act, to pay the charges. The Court held that the order under which the person was in custody was not an order against his person made "under any law relating to the imprisonment of fraudulent debtors" and that he had not been placed in custody as a result of any "execution or other civil legal process against (his) person". Stephen J. said (1972) 127 CLR, at p 420 :

"It follows that in my view persons serving terms of imprisonment for default in payment of road charges, and who may have already served terms of imprisonment for default in payment of pecuniary penalties imposed as a punishment for non-payment of those very charges, can nevertheless not be released from imprisonment under s. 60 (1), despite the fact that bankruptcy has deprived them of the ability to pay and that it is that inability which may have led to their default in payment and, hence, to their imprisonment."

The parliament clearly intended, by the amendment made to s. 60 (1) in 1980, to give the courts of bankruptcy a wider power than had been vested in them by the sub-section in its original form - a power that had become necessary by reason of the enactment of legislation making it an offence to fail to pay certain civil debts, empowering the courts to order the offender to pay the debt and providing for the imprisonment of the offender if the order were not obeyed. The question however is whether the sub-section, in its present form, is a law with respect to "bankruptcy and insolvency" within s. 51 (xvii.) of the Constitution. (at p555)

3. It was submitted by counsel on behalf of the State of Queensland that s. 60 (1) (b) has no sufficient connexion with bankruptcy and insolvency and is not a law of the kind referred to in s. 51 (xvii). It was said that its true character is that of a law with respect to imprisonment for offences which are not bankruptcy offences, and some support for this view was sought to be found in a passage in the judgment of Walsh J. in Commissioner for Motor Transport v. Train, which it was said showed that Walsh J. had taken the same view of the former s. 60 (1). In that case Walsh J. said (1972) 127 CLR, at p 410 : "But in any event, the central feature of the description of the law to which s. 60 (1) refers is that it is a law relating to imprisonment." In that passage Walsh J. was describing the character, not of s. 60 (1), but of the "law relating to the imprisonment of fraudulent debtors" referred to in that sub-section. The judgments in Commissioner for Motor Transport v. Train (1972) 127 CLR 396 provide no assistance to this submission. (at p555)

4. With all respect to the argument presented on behalf of the State of Queensland, in my opinion s. 60 (1) (b) is clearly a law with respect to bankruptcy and insolvency. The paragraph applies only after a petition under the Bankruptcy Act has been presented. It empowers the court to stay certain legal process against the person or property of the debtor and to discharge the debtor out of custody. The debtor, of course, is the person against whom the petition has been presented, and it has been held that the word "debtor" does not exclude a debtor who has been made bankrupt and that the operation of the section is not restricted to the period intervening between the presentation of the petition and the making of an order of sequestration: see Commissioner for Motor Transport v. Train (1972) 127 CLR, at p 403 . The legal process which may be stayed is process instituted against the person or property of the debtor in respect of the non-payment of a provable debt or of a pecuniary penalty payable in consequence of the non-payment of a provable debt, or in consequence of his refusal or failure to comply with an order of a court for the payment of a provable debt. The custody from which the debtor may be discharged is custody in which he is held in consequence of the non-payment of a provable debt or of a pecuniary penalty payable in consequence of the non-payment of a provable debt, or in consequence of his refusal or failure to comply with an order of a court for the payment of a provable debt. Stated shortly, the effect of the provision is to empower the court to relieve a debtor, against whom a petition has been presented, from process (civil or criminal) instituted against him because of his failure to pay a provable debt. The objects of the paragraph are to ensure that if a sequestration order is (or has been) made against the estate of the debtor his assets will be available for administration in the interest of his creditors generally, to prevent one creditor, who has the right to enforce payment of his debt under some other law, from exercising that right so as to gain an advantage over other creditors, and to protect the debtor from punishment because he has not paid the debt when payment might be a breach of the bankruptcy law. Under the Bankruptcy Act, once a debtor becomes bankrupt his property vests in the official trustee (s. 58) and with certain exceptions is divisible amongst his creditors (s. 116) and a court of bankruptcy may order that all or part of his income shall be paid to the trustee for the benefit of his creditors (s. 131). Even before he has been made a bankrupt, payment of a debt due to a creditor might be voidable as a preference under s. 122 of the Bankruptcy Act. A provision such as s. 97 (5) of the Industrial Act, under which a debtor can be ordered to pay a debt and imprisoned if he failed to do so, would tend to defeat the policy of the Bankruptcy Act; if the debtor complied with the order, the result would be likely to impede the due administration of the estate; if the debtor failed to comply with the order, it would be unjust to commit him to prison if his failure was due to the fact that a bankruptcy petition had been presented against him or he had been made bankrupt. (at p556)

5. An essential feature of any modern system of bankruptcy law is that provision is made for the appropriation of the assets of the debtor and their equitable distribution amongst his creditors, and for the discharge of the debtor from future liability for his existing debts. In Hill v. East and West India Dock Co. (1884) 9 App Cas 448, p 456 Earl Cairns cited with approval the following passage from the judgment of James L.J. in Ex parte Walton; In re Levy (1881) 17 Ch D 746, at p 756 :
"Now, the bankruptcy law is a special law, having for its object the distribution of an insolvent's assets equitably amongst his creditors and persons to whom he is under liability, and, upon this cessio bonorum, to release him under certain conditions from future liability in respect of his debts and obligations."
If further authority is needed for the proposition that the equitable distribution of the assets of the insolvent debtor is a fundamental purpose of the bankruptcy law, reference may be made to Attorney-General (Ontario) v. Attorney-General (Canada) (1894) AC 189, at p 200 and Reg. v. Davison (1954) 90 CLR 353, at pp 375-376 . It is equally clear that any system of bankruptcy law "may frequently require various ancillary provisions for the purpose of preventing the scheme of the Act from being defeated": Attorney-General (Ontario) v. Attorney-General (Canada); Royal Bank of Canada v. Larue (1928) AC 187, at p 197 . For example, it may be necessary to frame provisions to stop individual action by creditors for the purpose of obtaining payment of the debts due to them when the aim of the law is to secure administration of the debtor's assets in the interest of the creditors generally: Attorney-General (British Columbia) v. Attorney-General (Canada) (1937) AC 391, at p 402 . As I have attempted to show, the provisions of s. 60 (1) (b) are designed to assist in ensuring that the assets of the insolvent debtor are distributed in the interests of creditors generally, to prevent one creditor obtaining an undue advantage over the others, and to prevent the scheme of the Bankruptcy Act from being defeated. They are provisions with respect to "bankruptcy and insolvency" within s. 51 (xvii.). Moreover, the bankruptcy law has long been concerned to mitigate the severity of the primitive rules which gave creditors the power to secure the imprisonment of their debtors. In England, in 1719 provision was made for the release of bankrupts from prison after they got their certificates of discharge (Holdsworth, History of English Law, vol. XI, p. 446), arrest of debtors on mesne process was abolished in 1838 (Holdsworth, op. cit., vol. XV, pp. 99-114) and finally by s. 4 of the Debtors Act 1869 (U.K.) imprisonment for debt was abolished subject to specific exceptions. The provisions of some of the corresponding legislation of the Australian States are discussed in the judgment of Walsh J. in Commissioner for Motor Transport v. Train (1972) 127 CLR, at pp 407-410 . It may be accepted that in 1901, both in England and Australia, an insolvent debtor might still have been imprisoned under an order of a punitive kind, i.e. an order made as a punishment rather than as a means of execution, and that there was no power in courts of bankruptcy to grant relief in such a case. But the provisions of laws made under s. 51 (xvii.) were not intended to be stereotyped so as to confine the power of the Parliament to the legislative provisions existing in 1901 as to bankruptcy and insolvency: cf. Attorney-General (British Columbia) v. Attorney-General (Canada). If the powers of the courts of bankruptcy to relieve debtors against imprisonment imposed as a consequence of the failure to pay their debts was inadequate in 1901, the Parliament had power to extend them. A law which empowers a court of bankruptcy to order the release from prison of a debtor against whom a bankruptcy petition has been presented, and who is imprisoned because of his failure to pay a provable debt or a penalty payable in consequence of the non-payment of a provable debt, or because of his non-compliance with an order to pay a provable debt, is a law with respect to bankruptcy. (at p558)

6. For these reasons I consider that s. 60 (1) (b) is a valid enactment. No doubt was suggested as to the validity of s. 60 (1) (a). The entire sub-section is valid. In my opinion it is unnecessary to remit the application back to the Supreme Court. Of course, under s. 60 (1) (b) the court has a discretion to exercise, but it seems to me clear that in the circumstances of the present case, where the applicant is bankrupt, and unable to comply with the orders made by the industrial magistrate, the Court should exercise the power under s. 60 (1) (b) and discharge him out of the custody in which he has been placed as a result of the orders made on his conviction on the first and second charges. It was not suggested that s. 60 (1) (b) had any application to the third order, which was not an order in respect of the non-payment of a provable debt, but the applicant has fully served the period of imprisonment for which he was liable under the order on the third conviction. (at p558)

7. I would declare that s. 60 (1) of the Bankruptcy Act 1966 as amended by the Bankruptcy Amendment Act 1980 is a valid law of the Commonwealth. I would order that the applicant be discharged out of custody, and that any legal process against the applicant in consequence of his failure to comply with the orders of the Industrial Magistrate's Court made on his convictions for the offences against s. 113 of the Industrial Act and any further action on those convictions be permanently stayed. (at p558)

MASON J. I am in agreement with the judgment of the Chief Justice and with the declaration and orders which he proposes. (at p558)

MURPHY J. Section 60 (1) of the Bankruptcy Act (1966) (Cth), as amended, is valid. The sub-section is clearly a law with respect to bankruptcy and insolvency within s. 51 (xvii.) of the Constitution. It is immaterial that it invades the "general law" of the State, or affects State imprisonment laws. The State of Queensland intervening to argue invalidity advanced submissions of the kind which were decisively rejected in Amalgamated Society of Engineers v. Adelaide Steamship Co. Ltd. (1920) 28 CLR 129 (the Engineers Case). Recently encouragement has been given by decisions of this Court (see for example Reg. v. Lambert; Ex parte Plummer (1980) 146 CLR 447 ) to a resurrection of the doctrines discredited in the Engineers Case. The argument for invalidity advanced here, is the logical extension of the views which prevailed in Plummer's Case. Perhaps the difference in result between that case and this may be attributed to the circumstance that the Family Court's power to make orders inconsistent with State laws is novel, while the Bankruptcy Court's power to make such orders is familiar. However the constitutional principle is the same in both. One asks whether the federal law is one "with respect to", that is relevant to or connected with, a federal legislative power (see Grannall v. Marrickville Margarine Pty. Ltd. (1955) 93 CLR 55 ). The relevance or connexion does not have to be close or direct. Once that relevance or connexion is established it is immaterial that the law affects "the general law" of a State, it would be an unusual law if it did not. It is immaterial if in particular it interferes with State imprisonment laws. There is no exception to the legislative power of the Commonwealth in favour of State imprisonment laws. A federal law could provide for suspension or cancellation of State imprisonment for crimes in order to further enlistment in the defence forces. State imprisonment might be suspended or cancelled by a federal law for furtherance of federal judicial or administrative purposes relating to bankruptcy of the prisoner or some other person. The removal of persons out of State custody for such purposes is common in federal systems, for example to stand trial, give evidence or assist in the investigation of insolvency or other matters arising under federal law. (at p559)

2. I agree with the proposed order. (at p559)

AICKIN J. This matter was removed into this Court upon the application of the Attorney-General for the Commonwealth. It was an application under s.60 (1) of the Bankruptcy Act 1966 (Cth), as amended by the Bankruptcy Amendment Act 1980 (Cth), and was before the Supreme Court of Queensland which was exercising federal jurisdiction pursuant to the Bankruptcy Act. (at p559)

2. The facts out of which the matter arises may be shortly stated. The applicant Storey and his wife had carried on a business which failed and in which they had employed a clerk whose terms of employment were regulated by an award of the Industrial Commission prescribing rates of wages and terms of employment pursuant to the Industrial Conciliation and Arbitration Act 1961-1976 (Q.). She had been employed from about June 1978 until September 1979 but in the latter stages of her employment she had not been paid the full amount of wages due to her and on the termination of her employment she was not paid the amount of holiday pay due to her. An industrial inspector under that Act caused complaints to be issued against Storey charging him with offences under the Act in relation to non-payment of wages and holiday pay and with failure to keep a proper wages book as required by the legislation. The matters were returnable on 1 July 1980 and were heard on that day, the applicant not appearing. (at p560)

3. The charges were: (1) paying to an employee a lesser amount of wages than that prescribed by the Clerks and Switchboard Attendants' Award during the period 26 February 1979 to 19 October 1979 to a clerk employed by him contrary to s. 97 (1) of the Act. (For that offence he was fined $100 with costs $18 and ordered to pay the amount of wages unpaid, namely $2051.96, and in default of payment of the total amount within 28 days he was sentenced to 6 months imprisonment.); (2) failure to pay holiday pay on the termination of the employment of the clerk referred to, in breach of the same award. (For that offence he was fined $100 and ordered to pay the amount of holiday pay due and unpaid, namely $716.46 and in default of payment of the total amount within 28 days he was sentenced to 6 months imprisonment cumulative upon any other period of imprisonment.); (3) failure to keep a time and wages book during the period of 12 months immediately preceding 5 March 1980 contrary to the award referred to. (For that offence he was fined $30 plus costs $18 and in default of payment of the total amount within 28 days he was sentenced to 7 days imprisonment (concurrent).). (at p560)

4. The first two offences were breaches of express provisions of the award and are punishable pursuant to s. 113 of the Industrial Conciliation and Arbitration Act upon prosecution pursuant to s. 97 (5) of that Act. The third offence was a breach of s. 126 of that Act and punishable under s. 112. By virtue of s. 116 (4) of that Act those offences were within the jurisdiction of an industrial magistrate and could be prosecuted in a summary manner under The Justices Act 1886-1980 (Q.). (at p560)

5. In 1980 the applicant and his wife entered into a composition with their creditors under Pt X of the Bankruptcy Act which was approved by a meeting of creditors. However the applicant failed to make the payments due under the terms of the composition and on 10 November 1980 the applicant and his wife filed debtor's petitions under the Bankruptcy Act. (at p561)

6. The applicant failed to pay the fines imposed upon him and the other amounts ordered by the Magistrates Court to be paid by him. On 31 December 1979 he was arrested and imprisoned under s. 165 of The Justices Act. (at p561)

7. On 14 January 1981 an ex parte application was made to the Supreme Court of Queensland on behalf of the applicant for release and discharge from custody under s. 60 of the Bankruptcy Act. That application came before Connolly J. who ordered that notice be given to the Attorney-General for the Commonwealth and to the Attorney-General for the State of Queensland and thereafter the application to this Court for removal of the matter was madeon 13 February 1981 and pursuant to the order of this Court the bankrupt was released on bail pending the determination of the validity of s. 60. Prior to the Bankruptcy Amendment Act 1980, s. 60 (1) of the Bankruptcy Act had been as follows:

"The Court may, at any time after the presentation of a petition, upon such conditions as it thinks fit, discharge an order made against the property or person of the debtor under any law relating to the imprisonment of fraudulent debtors and stay any action, execution or other civil legal process against the property or person of the debtor and discharge him out of custody."

It had been held by this Court in Commissioner for Motor Transport v. Train (1972) 127 CLR 396 that that sub-section did not authorize the discharge out of custody of persons held under criminal process and that prosecutions for offences against the Road Maintenance (Contribution) Act 1958-1969 (N.S.W.) did not constitute civil legal process within the meaning of the sub-section. No question of the validity of the sub-section arose in the course of those proceedings. The Bankruptcy Amendment Act 1980 repealed s. 60 (1) and replaced it by the following new sub-section:

"The Court may, at any time after the presentation of a petition, upon such terms and conditions as it thinks fit - (a) discharge an order made, whether before or after the commencement of this sub-section, against the person or property of the debtor under any law relating to the imprisonment of fraudulent debtors and, in a case where the debtor is imprisoned or otherwise held in custody under such a law, discharge the debtor out of custody; or (b) stay any legal process, whether civil or criminal and whether instituted before or after the commencement of this sub-section, against the person or property of the debtor - (i) in respect of the non-payment of a provable debt or of a pecuniary penalty payable in consequence of the non-payment of a provable debt: or (ii) in consequence of his refusal or failure to comply with an order of a court, whether made in civil or criminal proceedings, for the payment of a provable debt,

and, in a case where the debtor is imprisoned or otherwise held in custody in consequence of the non-payment of a provable debt or of a pecuniary penalty referred to in sub-paragraph (i) or in consequence of his refusal or failure to comply with an order referred to in sub-paragraph (ii), discharge the debtor out of custody." (at p562)

8. It will be observed that par. (b) enables a court exercising jurisdiction under the Bankruptcy Act to stay any legal process whether civil or criminal against the person or property of a debtor in respect of the non-payment of a provable debt or a pecuniary penalty and to order the release from custody or to discharge the debtor out of custody where he is being held in consequence of the non-payment of a provable debt. (at p562)

9. An application was made by counsel for the Attorney-General of the Commonwealth to Connolly J. to adjourn the hearing of the application under the Bankruptcy Act to enable the Commonwealth to apply to this Court under s. 40 of the Judiciary Act 1903 (Cth) for an order that the matter be removed into this Court as being a matter arising under the Constitution or involving its interpretation. The constitutional question is the validity of s. 60 (1) of the Bankruptcy Act as inserted by the Bankruptcy Amendment Act 1980. (at p562)

10. That application was made to this Court on behalf of the Attorney-General for the Commonwealth on 13 February 1981 and was granted. On the same day this Court ordered the release of the applicant on bail. (at p562)

11. The only question which arises is the constitutional validity of the new form of s. 60 (1) of the Bankruptcy Act. There is no doubt that the amounts of wages underpaid and the amount of holiday pay due on termination of employment would constitute provable debts in the bankruptcy of the applicant and that, if the section is valid, the Supreme Court of Queensland in the exercise of jurisdiction under the Bankruptcy Act would have power to order the applicant's release under the amended section. The question is whether that section is a law with respect to bankruptcy. It was not suggested that it could be supported under any other head of federal legislative power. (at p562)

12. We are not here concerned with any question concerning laws relating to imprisonment of fraudulent debtors referred to in s. 60 (1) (a), a topic discussed in Train's Case (1972) 127 CLR 396 . The relevant provision is par. (b) of sub-s. (1) and the facts of the present case fall within sub-pars. (i) and (ii), the unpaid wages and holiday pay being provable debts, and the applicant is held in custody for non-payment thereof. A court exercising bankruptcy jurisdiction would, on the words of the section, have power to discharge him out of custody. (at p563)

13. The new sub-section draws no distinction between civil and criminal process but applies to each in relation to imprisonment for failure to pay provable debts. It thus operates in relation to a bankrupt who owes debts provable in his bankruptcy and who has been imprisoned for failure to pay such debts. It is obvious enough that his imprisonment deprives him of any opportunity of engaging in employment or any other permissible means of earning money to go towards the payment of his provable debts, whether those for the non-payment of which he was imprisoned, or others. (at p563)

14. The gradual abolition (not yet complete in Australia) of imprisonment for debt has proceeded along with the development of the modern bankruptcy law. The lengthy history of these topics is detailed in Holdsworth's History of English Law (see, e.g., vol. VIII, pp. 229-245, vol. XI, pp. 446-447, 595-600, vol. XIII, pp. 376-378 and vol. XV, pp. 97-100). It is enough for present purposes to note the provisions for partial relief from imprisonment for debt in the Bankruptcy Act 1838 (U.K.) 1 &2 Vict. c. 110 and the provisions of the Debtors Act 1869 (U.K.) 32 &33 Vict. c. 62 which substantially abolished imprisonment for debt and which provided that it should come into operation at the same time as the revised Bankruptcy Act 1869 (U.K.) 32 &33 Vict. c. 71. The history of the present s. 60 of the Australian Bankruptcy Act is discussed by Walsh J. in Train's Case (1972) 127 CLR, at pp 405-412 . (at p563)

15. The nature of bankruptcy as it has developed in the United Kingdom and in Australia requires that it should operate uniformly on debts of equal degree owed by a bankrupt, uniformly both as to the bankrupt and as to his creditors, and requires that provisions for the re-establishment of honest debtors should likewise operate uniformly. It is of the essence of the bankruptcy power that it enables the control of the property of bankrupts and of their persons, at least so far as offences against the bankruptcy laws are concerned, by a central authority, both for the collection of their assets and the payment of their debts. Section 60 operates upon the person of the bankrupt in relation to debts which are provable in his bankruptcy and as such lies at or near the heart of the power. (at p564)

16. In my opinion the material provisions of s. 60 (1) of the Bankruptcy Act are valid and prevail over the provisions of the Queensland legislation by reason of s. 109 of the Constitution. (at p564)

17. Since writing the above I have had the advantage of reading the reasons for judgment prepared by the Chief Justice and the order which he proposes. As the whole matter before the Supreme Court of Queensland was removed into this Court it can as easily be finally disposed of by this Court as by the Supreme Court on a remission to it. I agree that in the circumstances the only proper order would be to discharge the applicant from custody. I am therefore in agreement with the declaration and order as proposed by the Chief Justice. (at p564)

WILSON J. I agree entirely in the reasons for judgment of the Chief Justice, and concur in the declaration and order which he proposes. (at p564)

BRENNAN J. I have had the advantage of reading the judgment of the Chief Justice. I concur in those reasons and in the order which he proposes. (at p564)

Orders

Declare that s. 60 (1) of the Bankruptcy Act 1966 as amended by the Bankruptcy Amendment Act 1980 is a valid law of the Commonwealth.

Order that the applicant be forthwith discharged out of custody under the orders made on his conviction on 1 July 1980 of two offences against s. 113 of the Industrial Conciliation and Arbitration Act 1961 (Q.), as amended, and that any legal process relating to that imprisonment and any further action thereon be permanently stayed.

Order that the applicant's costs of the proceedings in this Court be paid by the respondent.