CATCHWORDS BANKRUPTCY NOTICE ~- application to set-aside bankruptcy notice by going behind judgment - late discovery by judament creditor prior fo the hearing out of which the judgment debt arose - failure by judgment debtors to seek an adjournment on the basis of late discovery - failure by judgment debtors to appeal against the judament - application dismissed. RE: ROBIN DAVID HUSTON and JILL LARRATNE HUSTON EX PARTE: KENDALL, McADAM AND O'DWVER (A FIFM) OLD BN2129 of 1985 PINCUS J. BRISBANE 11_ DECEMBER 1985 Il THE FEDERAL COURT OF AUSTPALTA } GENERAL DIVISION ~~ QLD BN2129 of 1295 BANKRUPTCY DISTRICT OF THE SOUTHERN } DISTRICT OF THE STATE OF OUEENSLAND ~ RE: POBIN DAVID HUSTON and JILL LARRAINE HUSTON EX PARTE: KENDALL, McADAM AND O''DWYER (A ETPM) MINUTES OF ORDER JUDGE MAKING ORDER: PINCUS J. DATE OF ORDER: Ll DECEMBER 1985 WHERE MADE: BRISBANE THE COURT FOUND AS FOLLOWS: 1. The application be dismissed. 2. The costs of and incidental ta this application. including reserved casts, be taxed and paid bv the applicant iudament debtors to the respondent firm. ent. the time for compliance with the bankruptcy nded until 5 p.m. on Friday, 13 December 1985, Ty in 'D »D btw + i) NOTE: Settlement and entrv of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF ANISTRALIA GENERAL DIVISION ~~ OLD BN2129 of 1985 BANKRUPTCY DISTRICT OF THE SOMTHERN DISTRICT OF THE STATE OF QUEENSLAND ~ ~~ FRE: ROBIN DAVID HUSTON and JILL LARRAINE HUSTON EX PARTE; KENDALL. McADAM AND O'DWYER (A FIRM) PINCUS J. 11 DECEMBER 1985 EX_TEMPORE REASONS FOR JUDGMENT This is an application made by Robin David Huston and Jill Larraine Huston for orders including an order that bankruptcy notice No. 2129 of 1985 be set aside or, in the alternative. a declaration that sufficient compliance with the notice shall be made by pavment of $2957.17. The bankruptcy notice was issued ona judament of Judge Pratt given in the District Court on 9 October 1985, The material before me shows that counsel who then appeared for the tudagment debtors had placed before him material. consisting of computer print-outs, on the eve of trial and had b not sufficient opportunity to examine them and appreciate their significance. Mr. Huston, one of the tudagment debtors, complains ———— ee LEC POT ES TT RS AF SEN TMM LITE Fae ee ae weve Ry ER cone of this and says, in effect, that had he appreciated the significance of the computer print-outs matters at the trial would have taken a different course. Although the figures at first sight seem rather complex. with the assistance of Mr. Hinson, counsel for the judgment debtors, they have been reduced to a much simpler picture. Mr. O'Dwver, who is one of the judgment creditors, being a member of the firm of Kendall, McAdam and O'Dwyer, has given evidence that the difference between the figure his firm would have charged had there been adherence to the charges disclosed by the computer print-outs, and the figure which was actually charged, was $2380.85. Mr Hinson frankly admits that that is not disputed. He points out, however, that on the evidence the computer print-outs were subject to a double process of adjustment. The first stage of adjustment is that discernible from exhibit 1. tendered before Judge Fratt which has become exhibit E to the affidavit of Mr. Huston, read before me. In that stage of adjustment the fee was taken up to $31,450.55. Mr. Hinson arques, and it seems to me correct, that subsequently a second stage or process of adjustment occurred which took that figure up to the higher sum of $37,040.55, and then bv giving discounts reduced it back to the original figure. Tt does not seem to me clear, by anv means, that the evidence placed before Judge Pratt disclosed this double process of adjustment, and Mr. Hinson relies particularly upon the fact that Mr. O'Dwver, as tal appears from page 8 of the transcript, seems to have qiven the impression that the figure sued for in the District Court included not only a discount of $2000, which was agreed with Mrs. Huston, but a further sum for prompt payment. That was so onlv in the sense that a discount for prompt payment was allowed off the higher figure consequential upon the second process of adjustment. namely $37,040.55, It is not really easy to follow why Mr. O'Dwyer did not explain to Judge Pratt the precise means whereby the final fiaure was arrived at. At least, I cannot derive from his evidence the explanation which he has made before me. Mr. Hinson arques that in the circumstances the court in exercise of jurisdiction under the Bankruptcy Act should go behind the District Court itudament and, in effect, require that the issue between the parties be reopened and relitiaated. He does not suggest that the District Court made what miaht be called any mechanical error, but asserts that because of the late discovery, and because of the answer qiven by Mr. O'Dwyer at page 8, there is sufficient reason to ao behind the judqment debt. He concedes that, since the matter 1s one which has produced a judgment after a trial, the task which he faces is substantially more difficult than it would have been had he faced merelv a default judgment. The point is really a short one, and forming the view that my consideration of it is not likely to be areater assisted by further reflection, I have determined to state mv view now. The record of many trials, if examined by the unsuccessful litigants later, may disclose rather unsatisfactory features; that circumstance 1n itself cannot justify a process of going behind the bankruptcy notice. The principal unsatisfactory feature to which Mr. Huston points is the late discovery and the lack of appreciation on his side of the precise significance of the computer print-outs, Also, of course, it is arqued that the judgment debtors did not have a reasonable opportunity to appreciate the way in which the figure sought in the District Court was arrived at. I am of the view that those circumstances do not justify what must be an unusual course, and that 1s to treat as incorrect a judgment after trial given by another court of competent jurisdiction and from which no appeal was brought. T can understand Mr. Huston's feeling that he has not had such an examination of the claim made by Messrs Kendall, McAdam and O'Dwyer as he would have desired. Nevertheless, it 15 an important principle that the processes of litigation must not be engaged in to such an extent as to bring the administration of justice into disrepute and it seems to me that, except in circumstances considerably stronger than those revealed by the material before me, the court should not be prépared to ao behind such a judament as this. I would add that it 1s a matter of considerable importance that Mr. Huston. through his counsel, decided not to seek any adjournment of the trial before Judge Pratt. It appears - " - oe ETE EOE TET a to be admitted that had he done so the difficultv would not have arisen, That is the sort of decision which, when made, must erdinarilvy be reaarded as having been finallv made. What Mr. Huston would now desire todois to reverse that decision, in effect, and have the matter tried after a proper consideration of the material which was discovered on the eve of trial, T am not prepared to accede to the application which is made on hehalf of the judament debtors, and it will be dismissed. I will arder that the costs of and incidental to this application, including reserved costs, be taxed and paid by the applicant judament debtors, Mr. and Mrs. Huston, to the cespondent firm, Kendall, McAdam and O'Dwver. By consent, I extend the time for compliance with the bankruptcy notice until 5 p.m. on Friday, 13 December 1985. i certify that this and the 4 preceding pages are a true copy of the reasons for judgment herein of His Honour Mr. Justice Pincus Qeurial oO 'Rue, / 7/12 [0s- Associate Dated