Todd, Re M.C. Department of Health

[1986] FCA 332

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C A T C H W O R D S

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BANKRUPTCY - S.81 summons - bankrupt discharged - whether still a I .

"bankrupt" for purposes of Act	- no power to issue summons after
discharge.

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Bankruptcy Act, 1966	55.5,	5 5 ( 8 ) ;	69; 81; 152(1); 153; 2 6 5 ( 1 ) :
269

Re: Maryon Catherine Todd

Ex Parte: Maryon Catherine Todd

Re: Marvon Catherlne Todd

Ex Parte: Desmond Ellis Todd

Re: Maryon Catherine Todd

Ex Parte: Cameron McDonald Finlay

Re: Maryon Catherine Todd

Ex Parte: Brian Raymond Gent

!	QLD E154 of 1980
PINCUS J.
BRISBANE !

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8 AUGUST 1986

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i	IN THE FEDERAL COURT OF AUSTRALIA	)
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; GENERAL DIVISION E154 ) QLD of 1980

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BANKRUPTCY DISTRICT	OF THE SOUTHERN	)	,
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DISTRICT OF THE STATE OF OUEENSLAND )

FE: MARYON CATHERINE TODD

Bankrupt -

EX PARTE: MARYON CATHERINE TODD

RE: MARYON CATHERINE TODD

Bankrupt

M PARTE: DESMOND ELLIS TODD

RE: MARYON CATHERINE TODD . =

Bankrupt *,I

EX PARTE: CAMERON McDONALD FINLAY ., .,

RE: MARYON CATHERINE TODD t:.

Bankrupt i '

M PARTE: BRIAN RAYMOND GENT

MINUTES OF ORDER

JUDGE MAKING PINCUS ORDER: J.

DATE OF ORDER:	8 AUGUST 1986
WHERE MADE:	BRISBANE

THE COURT ORDERS IN RESPECT OF EACH OF THE APPLICATIONS, THAT:

1.	The summons issued by the Registrar on	16 June 1986
be set aside.

2. The respondent pay the costs of and Incidental to

the proceedings, to be taxed.

NOTE : Settlement and entry of orders is dealt with in

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I Rule 124 of the Bankruptcy Rules.

IN THE FEDERAL COURT OF AUSTRALIA	)
GENERAL DIVISION	) QLD E154 of 1980
BANKRUPTCY DISTRICT OF THE SOUTHERN	)
DISTRICT OF THE STATE OF OUEENSLAND	1

l RE: MARYON CATHERINE TODD

Bankrupt

EX PARTE: MARYON CATHERINE TODD

RE: MARYON CATHERINE TODD

Bankrupt

EX PARTE: DESMOND ELLIS TODD

RE: MARYON CATHERINE	TODD	.	i
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Bankrupt t

M PARTE: CAMERON McDONALD FINLAY

RE: MARYON CATHERINE TODD

Bankrupt

EX PARTE: BRIAN RAYMOND GENT

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PINCUS J. 8 AUGUST 1986

REASONS €OR JUDGMENT

These are applications made to set aside summonses

issued by the registrar on 16 June 1986 purporting to be under

s.81 of the Bankruptcy Act. The bankrupt became so on her own

petition on 3 April	1980 and obtained an unconditional discharge
on 22 July 1981.

Mr. Bourke, who appeared for the applicants, relied on

two arguments. The first was that the power-to summon people to

attend under 5.81 cannot be exercised after the bankrupt in

question has been discharged. The second point was in substance

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that, if there is power to issue summonses, it was exercised

oppressively. Since that depends upon rather complex facts, it	s
convenient to consider the jurisdictional point first.

Section 81(1) is as follows:

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"The Court or the Registrar may, on the application I

of a creditor who has proved his debt and on such

terms as to costs as the Court or the Registrar

thinks fit to impose, or on the application of the

Official Recelver or the trustee,	at	any time
summon -

(a)

the bankrupt or the spouse of the bankrupt; or

(b)

a person who is known or suspected to have in

his possession any of the property of the

bankrupt, or is supposed to be indebted to the

bankrupt or to be able to give information

concerning the bankrupt or his trade deallngs,

property or affairs,

to attend, on a date and at a ime and place fixed

in the summons, before the Court or the Registrar

or, If the Court or the Registrar thinks fit,

before a Magistrate, to give evidence concerning,

and produce any books (whether or not in exlstence

at the time the bankrupt became a bankrupt) in his

custody or power relating to, the bankrupt or his

trade dealings, property or affairs." !, ,'

Mr. Gibson, who appeared for the respondent Official

Receiver, relied primarlly upon the definitlon of "bankrupt" in

5.5 which is as follows:

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"'bankrupt' means a person -

(a) against whose estate a sequestration order has

I been made; or

(b) who has become a bankrupt by virtue of the presentation of a debtor's petition;".

It was argued that, because of the definition, a person who has

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become a bankrupt thereafter remains	a bankrupt, without limit as
to time.

I was referred, however, to a provision having a

contrary tendency, namely s.55(8) which is as follows:

"A person who becomes a bankrupt by force of this

section continues to be a bankrupt until -

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(a) he is discharged by force of section 149;	I '
(b) he is discharged by order of the Court; or

(c) his bankruptcy is annulled under section 74 or

154. 'I

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This sub-section deals only with persons who have become bankrupt

on a single debtor's petition, but there are similar provisions

relatlng to those the subject of creditors' petitions (s.43(2))

and other sorts of debtors' petitions (s.56(16) and s.57(10)).	It
is, plalnly, possible to reconcile the definltion of "bankrupt"

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with these provlsions, by reading the former as subject to the

latter.

I On the face of it, the effect of the provisions just

mentioned is that the status of bankruptcy ceases with discharge.

Mr. Gibson admitted that to be so, but claimed that there is a

distinction between havlng the status of bankruptcy and being

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properly called a bankrupt.

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It is true that at some places in the Act the word

"bankrupt" is used in a sense which does not necessarily mean

I "undischarged bankrupt". Examples are to be found in those

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provisions which use the expression jusL quoted - e.g.

s.Z60(1)(a)(ii). If the word "bankrupt", without addition, means

a person who has not yet got a discharge, then the expression

"undischarged bankrupt" is tautologous. However, these usages may be able to be explained as emphatic or adopted out of an abundance of caution.

In s.269 the expression "undischarged bankrupt" appears

to be used in this way. The first part of that section reads:

"A bankrupt shall not -

(a)	either alone or jointly with another person,
obtain credit to the extent of $500 or more
from a person without informing that person that he is an undischarged bankrupt;".

It 1 s noteworthy that he provlsion does not begin "An

undlscharged bankrupt shall not . . . ' I . There, the concern of the

leglslature is to requlre that the bankrupt underline his status

by describing himself as undischarged. Where no need for emphasis

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arises, however, the draftsman is content to use the expression "a I ,

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bankrupt" as referring to a person who 1 s not yet discharged. An

example of this is to be found in s.265(1) which begins:

"A bankrupt -

(a) shall, to the best of his knowledge and

belief, fully and truly dlsclose to the

trustee all his property, and Its value;".

Plainly, the obligation	of	disclosure is not intended	to be
lifelong.

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Under s.153, discharge releases a bankrupt from his

debts, with certain exceptions. It may be thought to be arguable

that s.153 exhaustively prescribes the consequences of discharge. c ..

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l.; However, that would seem plainly not to be so; the disabilities

of bankrupty created by the Act are surely not intended,	in
general, to survive discharge.

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Section 152(1) says that:	! .
“A discharged bankrupt shall, notwithstanding his
discharge, give such assistance as the trustee

reasonably requires in the r alisation a d

distribution of such of his property as is vested

in the trustee. ‘I

It was argued that the purpose of this provislon is to provide the

trustee with some remedy against the discharged bankrupt, there

being no right to examine him under s.69 (the public examination

provision) or 5.81. In my view that is correct. There was some

debate as to whether this is a convenient result. It does not

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seem so evidently inconvenient as to require a departure from the

ordinary meaning of the words used.

Counsel referred me to a line of English authority

beginning with Re Coulson; Ex Parte Official Receiver (Trustee)

C19347 1 Ch. 45 in favour of the view that the power to require

attendance under the English equivalent of s.81 may be exercised

after discharge. Attention was drawn to the fact that Clyne J.

regarded Re Coulson as applicable to the Bankruptcv Act 1924: - Re Walker (1952) 16 A.B.C. 69 at 72. Lockhart J. confessed to

i	reservations about this line of authority in Re Balhorn;	Ex Parte
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Balhorn and Official Trustee (1981) 39 A.L.R. 223 at 225. It does

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not seem necessary to determine whether Re Coulson should be

followed, because the provisions of the English Act of 1914 on

which it was based are not closely similar to those with hich I

am concerned; in particular the relevant English provision uses

the word "debtor", not "bankrupt".

It appeared to be suggested that even if a discharged

bankrupt is not himself liable to be summoned under 5.81, those l

who are suspected to have property of his in their possesslon, or

the like, are so liable. That would seem to be an anomal.ous

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distinction. If "bankrupt" in S. 81( 1) means "undischarged

bankrupt" then in my view no-one may be summoned under it, in

respect of the affairs of one who has obtained a discharge;

otherwise the word "bankrupt" has to be given two meanings in the

one sub-section.

In summary, I accept Mr. Bourke's contention that the

power to issue a summons under s.81 applies only when the person

to whose affairs the proposed evidence would relate is, at the

time, a "bankrupt", by which is meant an undischarged bankrupt.

The applications must succeed, and with costs.

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