Veale v Coleman

In the matter of Veale v Coleman, the respondent, Mr Veale, sought to set aside a bankruptcy notice issued against the applicant, Mr Coleman, under section 41(1) of the Bankruptcy Act 1966 (Cth). The dispute arose from a foreign currency judgment debt originating from a judgment in Singapore, which was later registered in New South Wales. The primary judge had set aside the bankruptcy notice, finding it invalid due to non-compliance with regulation 12 of the Bankruptcy Regulations 2016 (Cth). Mr Veale appealed this decision, arguing that the primary judge erred in concluding that the notice was invalid due to the inclusion of an incorrect date for the conversion of the foreign currency judgment debt to Australian dollars and the rounding of the exchange rate to two decimal places.

The court had to decide whether the bankruptcy notice was defective and, if so, whether any such defect was merely formal and did not render the notice invalid. The key issue was whether the inclusion of an incorrect date for the exchange rate and the rounding of the rate constituted a significant non-compliance with regulation 12 of the Regulations. The court noted that while the incorrect date was inserted, the actual exchange rate used was correct, and this did not affect the accuracy of the conversion calculation. Furthermore, the rounding of the exchange rate, which was down rather than up, also did not materially impact the result.

The court concluded that the defect in the bankruptcy notice was indeed formal rather than substantive. The court held that the inclusion of an incorrect date for the exchange rate did not breach the requirements of regulation 12, as the rate used was accurate. The rounding of the exchange rate was also deemed to be a minor defect. Given these findings, the court allowed the appeal, set aside the primary judge's orders, dismissed Mr Veale's application, and ordered Mr Veale to pay Mr Coleman's costs of the originating application. Additionally, Mr Coleman was ordered to pay Mr Veale's costs of the appeal.