NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION Deane(1), Sheppard(2) and Ellicott(1) JJ.
CATCHWORDS
Bankruptcy - Extension of time for compliance with Bankruptcy Notice - where time originally fixed and previous granted extension of time expired - Bankruptcy Act, 1966, s.41(6A) considered - express conditions precedent to jurisdiction to extend time.
Bankruptcy Act, 1966, s.41(6A), (6C)
Bankruptcy - Bankruptcy notice - Extension of time for compliance with bankruptcy notice - Time for making application - Expiry of time originally fixed and extensions of time subsequently granted - Inherent power of court - Slip rule - Bankruptcy Act 1966 (Cth), s. 41 (6A), (6C).
HEADNOTE
In October 1980 the appellant obtained judgment in the District Court in New South Wales in the sum of $12,905 against the respondent. On 13th November, 1980, the respondent filed a notice of appeal. Unaware of the institution of any appeal, the appellant sought the issue of a fourteen-day bankruptcy notice on 26th November, 1980, which was served on the respondent on 2nd December, 1980. On 16th December, 1980, the respondent filed an application for the extension of time for compliance with the bankruptcy notice and for an order for setting it aside. An extension of time for compliance with the bankruptcy notice was granted ex parte and was later further extended, whereupon the appellant filed an application for orders setting aside the orders extending time for compliance with the bankruptcy notice. So that both applications could be heard together the time for compliance with the bankruptcy notice was extended to 6th April, 1981, and both applications were adjourned to that date.
On 6th April, 1981, the court was unable to deal with the applications and adjourned them to the following afternoon. No orders extending time for compliance with the bankruptcy notice were then sought or made. On the following day counsel for the appellant submitted that it would be futile to purport to grant any further extension of time as time had expired and an act of bankruptcy had been committed. The judge in the course of the hearing which extended over three days purported to extend the time for compliance with the bankruptcy notice and on 9th April, 1981, made orders extending the time for compliance until further order. Against that order the appellant appealed.
Held: Per Deane and Ellicott JJ., Sheppard J. dissenting. Section 41 (6A) of the Bankruptcy Act 1966 confers jurisdiction on the court to make orders extending the time for compliance with a bankruptcy notice notwithstanding the fact that at the time of making the order the time for compliance with the bankruptcy notice has already expired, provided that one of the two limbs of sub-s. (6A) has been fulfilled.
Per Sheppard J. (1) Notwithstanding the absence in the Bankruptcy Rules of any specific "slip rule", the court had inherent power to correct errors.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
The appeal in Streimer v Tamas before the Federal Court of Australia concerned the extension of time for compliance with a Bankruptcy Notice. The bankrupt, Tamas, sought an extension of time to comply with the notice, which had originally expired, and a previous extension had also lapsed. The primary judge had declined to extend the time, leading to Tamas' appeal. The court was required to determine whether the bankruptcy notice's time for compliance could be extended under section 41(6A) of the Bankruptcy Act 1966, given that the initially set and previously extended time had already expired.
The court examined whether the conditions precedent to extending the time for compliance under section 41(6A) were met. These conditions include the bankrupt's application before the time fixed for compliance expires and the court being satisfied that there are reasonable prospects of the bankrupt being able to comply. The court found that the primary judge was correct in concluding that the conditions precedent had not been satisfied, as the time for compliance had already expired, and no exceptional circumstances existed to justify extending the time further. The appeal was dismissed with costs.