a uot} SS CATCHWORDS BANKRUPTCY - the debtor's notice pursuant to s.41(5) of the Bankruptcy Act not given within the time specified ~ an application to extend the time for giving the debtor's notice made pursuant to s.41(6A) of the Act - applications dismissed, Bankruptcy Act 1966, as amended, (Cwlth) ss. 41(5) and (6A) Streimer v. Tamas (1981) 37 A.L.R. 211 applied Re: GRAHAM CAIRNS; ex parte THE ABOVENAMED AND CHUBB'S PANEL AND PAINT SERVICE No. 329 of 1983 FITZGERALD J. BRISBANE 26 MAY 1983 lit nt land oh tlt Sena ee IN THE FEDERAL COURT OF AUSTRALIA BANKRUPTCY DISTRICT OF THE SOUTHERN GENERAL DIVISION No. 329 of 1983 DISTRICT OF THE STATE OF QUEENSLAND Re: GRAHAM CAIRNS Ex parte: THE ABOVENAMED AND CHUBB'S PANEL AND PAINT SERVICE ORDER JUDGE MAKING ORDER: FITZGERALD J. DATE OF ORDER: 26 MAY 1983 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The debtor's applications are dismissed. 2. The debtor must pay the creditor's taxed costs of these proceedings. IN THE FEDERAL COURT OF AUSTRALIA GENERAL DIVISION BANKRUPTCY DISTRICT OF THR SOUTHERN DISTRICT OF THE STATE OF QUEENSLAND No. 329 of 1983 Res GRAHAM CAIRNS Ex parte: THE ABOVENAMED AND CHUBB'S PANEL AND PAINT SERVICE FITZGERALD J. 26 MAY 1983 REASONS FOR JUDGMENT On 26 October 1982, the Stipendiary Magistrate at Kingaroy gave judgment in favour of Chubb's Panel and Paint Service (the Creditor) against Graham Cairns {the debtor). The concluding words of the judgment detivered were - "I give judgment for the Plaintiff for:- Claim - 976.46 Costs of Plaint and Summons - 109.45 Professional Costs (Preparing for Trial - 193 Counsel on hearing ~ 184 Solr. on hearing) ~- 162 539.00 Witness expenses 1 @ $26 26.00 TOTAL $1650.91 " A letter dated 28 October 1982 was forwarded by the Registrar of the Magistrates Court at Kingaroy in the following terms: "Re:- Kingaroy Magistrates Court Plaint 28/1982 Chubs Panel & Pain Service -v- Graham Cairns i I refer to the above and to the Decision dated the 26th. instant and list hereunder amended Order as to Costs. Claim 976.46 Costs of Plaint & Summons 109.45 Professional Costs - Preparing for Trial - 193.00 Counsel on Hearing ~- 184.00 Solr. on hearing 74.50 451.50 Witness Expenses i @ 26.00 26.00 TOTAL $1563.41 " No question has been raised in these proceedings as to the power of the Magistrate's Court to vary the judgment which had been delivered by reducing the professional costs awarded. Both parties accept as a starting point that a judgment in accordance with the contents of the-letter was delivered in favour of the creditor against the debtor: cf Magistrates Courts Rules, 1960 (Qld), Rule 199. Formal judgment was entered on 9 December 1982. The formal judgment was expressed to be for the amount of $976.46 for claim and the amount of $632.00 for costs, including $45.05 costs of entering judgment. The total for which the judgment was entered thus exceeded the amount for which judgment was delivered by the sum of $45.05. There is no suggestion that the debtor has appealed or applied to have the judgment entered either varied, set aside, or quashed. beeen nen ates neds emis Rhee ane tleineechel an nmeeiaminns, idiecemmasnminanemamenansimanaadiinthinn lien ae 3. On 23 February 1983, on the application of the creditor, the Registrar for the Bankruptcy District of the Southern District of the State of Queensland issued a Bankruptcy Notice, No. 329 of 1983, directed to the debtor. The sum specified in the bankruptcy notice as the amount due to the creditor was the full amount for which the judgment had been entered, including the sum of $45.05 for costs of entering the judgment. The bankruptcy notice was served on the debtor on Monday 21 March 1983 at 5.45 p.m. On 5 April 1983, the debtor by his solicitors filed a notice in the following terms: "T HEREBY GIVE NOTICE pursuant to Section 41(5) of the Bankruptcy Act 1966 to 1980 as amended that I DISPUTE the validity of the Bankruptcy Notice No. 329 of 1983 on the ground that the amount specified in the notice as the amount due to the Creditor exceeds the amount in fact due in that certain costs of Court and professional costs that the Judgment Creditor is not entitled to claim nor is the Magistrates Court empowered to allow, have been included therein." A copy of the notice was given to the creditor's solicitors on Wednesday 6 April 1983. It is not in dispute that that was outside the time allowed for payment under the bankruptcy notice. On19 April 1983, the debtor made an application to this Court for the following orders: = attend be tom + 4, "1, 'What the Bankruptcy Notice 329 of 1983 and dated the 22nd February, 1983 be declared invalid; 2. That the costs of and incidental to this application be paid by the Respondent/Judgment Creditor." That application was not made until after the time for compliance with the bankruptcy notice had expired. Before me the debtor applied for an extension of the time fixed for compliance with the bankruptcy notice, relying upon sub~s. 41(6A) of the Act. It is common ground that, under the Magistrates Court Rules, the creditor was only entitled to $22.00, being part of the $45.05 costs of entering judgment, and that the amount for which the judgment was entered and which is specified in the bankruptcy notice as the amount due to the creditor exceeds the amount in fact due by the debtor by the sum of $23.05. The creditor does not now seek payment of the amount of the excess. The debtor did not submit that the bankruptcy notice was invalid because the judgment upon which it was founded was invalid as beyond the jurisdiction and/or the power of the Magistrates Court which is an inferior court of limited jurisdiction. For the debtor to succeed in his claim to have the bankruptcy notice declared void, he must do so by reference to sub-s. 41(5) of the Bankruptcy Act. The creditor has conceded that the amount for which it has a valid judgment from the Magistrates Court at Kingaroy is less by the sum of $23.05 than the amount for which judgment was in fact entered. The sum specified in the bankruptcy notice as the amount due to the creditor is the sum for which judgment was entered and thus, in accordance with the creditor's concession, exceeds the amount in fact due to the creditor by $23.05. Further, it is not in dispute that the debtor gave notice to the creditor that he disputed the validity of the notice on the ground of a mis-statement of the amount due. Sub-section 41(5) of the Bankruptcy Act provides: "A bankruptcy notice is not invalidated by reason only that the sum specified in the notice as the amount due to the creditor exceeds the amount in fact due, unless the debtor, within the time allowed for payment, gives notice to the creditor that he disputes the validity of the notice on the ground of the mis-statement." The creditor did not dispute that the implication to be derived from that sub-section is that if the sum specified in a bankruptcy notice does exceed the amount in fact due to the creditor and the debtor does give the notice for which the section provides, failure to comply with the bankruptcy notice does not constitute an act of bankruptcy. However, aS 1S apparent from its terms, sub-s. 41(5) operates only if the notice 1s given within time (and it was not) or unless the time is extended, as the debtor now seeks. [- ett aanlaaidcas © eenamimenpndon apical diel menileaciemete Se = acchiiilincheme. amie tke triad tele tee = eel Further, I am satisfied that there is now no power to extend the time. Sub-section 41(6A), under which the application for an extension of time was made, also requires that the step relied on, in this case an application to set aside the bankruptcy notice, has been taken before the expiration of the time fixed for compliance with the requirements of the notice. That condition was not fulfilled. It is now too late. The act of bankruptcy has been committed: see Streimer v. Tamas (1981) 37 A.L.R. 211 and cases cited. For the reasons given, the debtor's applications are dismissed. The debtor must pay the creditor's taxed costs of these proceedings. Ic 'y thatthe andthe 5 preceding ™ -°3 ae a true copy of the reasons for Ju Suwnent herein of His Honour 'uw Justice Fitzgerald prs fpbeeen Associate Daied 26 Mey I?