BANKRUPTCY - materials supplied by the creditor to the debtor's husband for use in his business - account in joint names ~ bankruptcy notice based on a judgment debt obtained in the Magistrates Court relating to these materials - debtor neither authorized nor knew thak her husband was opening a joint account ~ debtor did nothing to hold out that her husband was authorized to use her name or that she accepted responsibility for the debt - creditor's petition dismissed - debtor's attitude to Magistrates Court plaint and judgment - no order as to costs. Bankruptcy Act 1966 (Cwlth), s.52 Re: ALMA JOYCE WHEATON; ex varte WATTYL (QUEENSLAND) PTY LTD Qld Pet No. 60 of 1983 FITZGERALD J. BRISBANE 30 MAY 1983 IN_ THE FEDERAL COURT OF AlDsIRALTA GENERAL DIVISTON IN THE BANKRUPTCY DISTRICT OF THE SOUTHERN DISTRICT OF THE SLPALE Ob ) ) Pet No GO ol bony QUEENSLAND ) Res ALMA JOYCD WHEATON Paparte: WALPYL (qQlhinal wp) pry Lin ORDER JUDGE MAKING ORDER: PIC/OLRALD oT. DATE ORDER MADE: jO MAY LOS WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The petition is dismissed 2. No order as to costs IN THE FEDERAL COURT OF AUSTRAT ILS GENERAL DIVISION IN THE BANKRUPTCY DISTRICT OF Pub SOUTHERN DLSTRICT OF UAB STATL OF QUEENST AND y Per. No. of of 1989 ) Re: ALMA JOYCE WHE ALO Rx parte: WATPYL (QUIENSLWD) pry lrp FITZGERALD J. 30 MAY 198 3 EXTEMPORE REASONS POR JT DGMENT The pet:iLion for a Sse puestratiom order avast the estates of Alma Joyce Wheiton, the debtor, .nd hes husband was presented by Waltyl (Queens Lend) Proprretary Limited, the creditor. on 29 Noventber 1962, A nequestration order has already been made apaaist the state et the debtorts husband on the petition. The pelitaon alleged that the debtor and her husband were gustly and truly andebted to the credrvlor am the sum of $2419.35, beius moneys ovine pursuant too default judsment obtained by the creditor agaansr the deblor wand her husband un the Magistrates Couzt on I') May 198%. The events Leading up to the bankruptey of the debtor were a failure to comply :elfore 2t Jubls Tus? wilh the requirements of a bankrupts y potree serves um her on wd 7 July !982 or satisly the counter-clarim set oof f are exceeding the sum specifie The banktruptey nulice tas obtained by the creditor 1 jgudgment relating to miler to the debtor's huskLand fo debtor has given notice of on the ground that she as Tho as not realivet to go behind the default 4 was made that T should nol faalure to protect her pos an earlier stage of the pr TL was the dehtort dealt with the creditor. Graeme Gratton, a sales re ereditor at Toowoomba. Th and the oraganal basis on Mr Gratton was casi on del beganning Mr Gratton used matetiels without payment "under the table" until th In Seplember 1981 creditor were overduc amd husband and Mr Gratton Clic court ebat she dies ross-denmand Gaited too ua doin the Demkeuptey naliroe based on the yudement debt nN the "hiuyistrates Comr dl, the nels supplied by the creditor rourc cn itis business. tlie Tnlert2on Lo oppose the petrtion nol radeltecd to the eredilor. ao dispmle that there ors power Weement, elthoush Clee subir ss torn Jo so im view ot the doebtorts Pttom @S she might have done al ocevdLuys. s Hhussand who at all tunes His dealiips were with one presentative employed by the ¢ dealdigs commerecd ain baye wheel the husband dewalt waitn JVOLM. However, from the vwery Co supply Line amie need oath and pet orrmed thre chor hed € Pusbe uel maebe par edad the lrsbend'?s pouxyments boo tte Llowes ar reniged bebween the {othe ltssbeaed sould oper an we accounl, Tn o1der to vo tht. un eppleeation foro ecredel had to be made wand forwarded to the eredttarts Jrea otfice. Such an application wes metho aut bs th tube rt 4 on or about 22 September Tal. Sh Gerabtom in crécd the names of beth the husband aud the debtor an order to improve the husband's prospects oo, vem permibeed ber the creditor to trade on a credit basis. There £5 not the strehtesct bases Lor com luding that the debtor knew that her Jusband wis opens an iwccount an their joznt names, or tlreet she atubhorized lim ta do so, or that Me Gratton belreved thar sueli aa authority heck been vaven. Mx Gratton's eflfidevuet may perhaps supe of i) paragraph 5 that he believed thal there sas a partnership between the debtor and hei hiusteane'', bit there 15 nothing to tndicate any basis6 for such a belaicf,. After the credit applic dion Nad been completed Mr Gratton contanucd to supply the husband He «ontanued to hold isnvoices for ae period of epprostimilely one sook prior to sendinsrs them to the creditor's head olf tee at Brisbu.ec. so that accounts could be fotwerdced by the orcditor. ALL anvoetces and all recetpts comtinded fo stoe only cise husband's name, However, Crom .baut October Tost uu wits were sent out im the gornt meade s of the debtor me her husband. The first hnowlecdge wheel the debtor tiad that her husband had used her mame was whew am aeeount ai their goint names was reeeived., Accordatme boo Che debto1's husbanicl (he debtor sas fircrous bet wold her not to worty as be would pay toe aecomne. rs to the debtor, she telephoned "tte Giatteoa ued tibu.mech vin that her husband had nu unthurirty trom lier te oa via tie had done and she "made st cleu the would uot la ge spree gta for the payment of the debt". Mr Gratton had a daffercnt recollection of: the telephone conversation. He swore an alfidavit and was cross-examined, as was the debtor \dthough he was net deliberately untruthfinl, he was not partirealbetriy liclpiul. le dad, however agree that further credit wae extenced to the debtor's husband after the debtor lad asked thet mo further credit be catended to Jim. The debtor achnowle dees that she observed that further mouthly aes ounrs continucd Lo have both names on them, but she says thal she was mol concerned because her Husband Ibid promised fo pay tle at count and because of the conversation she cl arms lat she lewd head with Mr Gratton. She satd lUliat she did mot belreve that her laabilaty would be seriously pursted. When she was served welh rhe Magcestrates Court plaint she relied upon her husband's promise to pay the debt and did nothing. Of course, even on her own version, that does not entirely explain Jicr Caslure tu take steps to Smount a defence in the Magistrates Court and to defend the Magistrates Court pioceedinys. Ww when the banktruptey notice was served om Lhe debtor. her husband contacled a solicitor and a letter was written denying the debtor was Itable to the creditor and stating at was antemded to appecnl capris t the Masisirates Court decision wid to dedomdl ony bankruptcy proceedings. However, me suclt stip wis taken. The Magistrates Court gudpment stances. Again, on the debloits cvauenece she relied on her husband to pay the account. There are dilicrenecs in the evidence of the debtor and M Gratton concernins when various telephone conversations took place and what was said. I do not propose to resolve those difterences in detail. In my opinion. mo basis exists upon which the debtor 1s liable io the creditor. The debtor certainly did not know it was an account in the joint names of herself and her husband until atter the reeetpl ot an account from the crediionr. TL ts not clear how amich of the Liability was ancurred prior to that daie, bul 1 does not matter. The debtor did nothing to hotd out that her husband was authorized Eo usc her name or that she accepted responsibilaty for the debt erther by ael or omission. Turther, there 1s nothin;, to andtcale that the creditor would not Nave supplied materials to the hasteand awbut for some act or omission of the debtor. Desps le : Oo. anstraetions lo the contrary, Mr Gratton continued to supply goods to the husband and luvoices vere temporarily pul "under the table", thus giving lhe husband credit in facet even aLtor disputes had arisen and Titiggsatazon had been commence. Toam satisfied there as ie basis for the yudgiment debt and that tle debtor 15 not andehted Co the crediutor. Lo therefore propose (au dismiss the poetrireon. However. the attriude of the deblor has been Cuvalier amd grossly ri responsiele amd accordingly T propese to make no order as to costs The order of the court is that the petition is dismissed. No order as lo costs, en