JUDGMENT No. Sc... BC CATCHWORDS BANKRUPTCY - Power of Inspector-General under s.15(4) to direct "an officer" to perform duties etc. of an Official Receiver - Deputy Registrar given such a direction applying for issue of summons under s.81 - Whether the power to direct extended to a direction given to a Deputy Registrar - Meaning of "officer" in s.15(4) ~- Whether upon review under s.14(5) it was open to attack the capacity of a person de facto directed under s.15 - Authorities dealing with the powers of de facto officers referred to. Bankruptcy Act 1966, ss.5, 14, 15. KENNETH GRAHAM WINTON -V- JAMES JOHN JOLLIFFE NSW G.580 of 1987 Morling, Burchett & Gummow JJ. Sydney 7 March 1988 oo) IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) No. G.580 of 1987 ) GENERAL DIVISION ) BETWEEN: KENNETH GRAHAM WINTON Appellant AND: JAMES JOHN JOLLIFFE Respondent MINUTE OF ORDER OF THE COURT Judges Making Order: Morling, Burchett and Gummow JJ. Where Made: Sydney Date of Order: 7 March 1988 THE COURT ORDERS THAT: The appeal be dismissed with costs. NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) No. G.580 of 1987 ) GENERAL DIVISION ) BETWEEN: KENNETH GRAHAM WINTON Appellant AND: JAMES JOHN JOLLIFFE Respondent CORAM: Morling, Burchett & Gummow JJ. DATE: 7 March 1988 PLACE: Sydney REASONS FOR JUDGMENT THE COURT This 1S an appeal from a judgment of a Judge of the Court, dismissing an application under s.14(5) of the Bankruptcy Act 1966. The circumstances which have given rise to the debate upon the appeal can be very briefly stated. On 6 September 1984, pursuant to s.188 of the Act, the appellant authorized a registered trustee (the trustee) to call a meeting of creditors. A meeting of the appellant's creditors called on 25 September 1984 passed a special resolution that he execute a Deed of Assignment, which he did. The trustee was duly appointed trustee under the Deed. It seems that questions arose in connection with the Deed of Assignment, the Statement of Affairs of the debtor, and his assets. On 3 March 1987, the Inspector-General in Bankruptcy 2. executed what was described as an "Authority under section 12 and direction under sub-section 15(4)". (Section 15 will be set out later in these reasons.) By this instrument, it was provided as follows: "I, PETER JAMES WENN, the person for the time being occupying the office of Inspector-General in Bankruptcy: (1) pursuant to sub-section 12(2) of the Bankruptcy Act 1966 hereby appoint JAMES JOHN JOLLIFFE to inquire into and investigate (a) the administration of and the conduct of the trustee Colin George Ward in relation to the deed of assignment number W168/84 Part X executed by the debtor Kenneth Graham Winton; and (b) the conduct, trade dealings, property and affairs of the debtor Kenneth Graham Winton; and (2) pursuant to sub-section 15(4) of the Bankruptcy Act 1966 I hereby direct JAMES JOHN JOLLIFFE to exercise the powers and functions and perform the duties of an Official Receiver under section 81 of the Bankruptcy Act 1966 so far as is necessary for the purpose of carrying out the inguiry and investigation." It will be observed that the instrument appoints and directs an individual by name. In fact, Mr. Jolliffe was at all material times a Deputy Registrar in Bankruptcy for the Bankruptcy District of New South Wales and the Australian Capital Territory. By application dated 30 March 1987, lodged by the Australian Government Solicitor on his behalf, Mr. Jolliffe 3. applied in the usual manner for the issue of a summons under s.81(1) of the Act directed to the debtor, Kenneth Graham Winton, who is the appellant. Although the application described Mr. Jolliffe as Deputy Registrar in Bankruptcy, it recited the instrument dated 3 March 1987, making it clear that the application was made in the capacity with which that instrument clothed him. Of course, by virtue of s.231 of the Act, s.81 was applicable to the case of the appellant. Section 81(1) provides: "The Court or the Registrar may, on the application 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 Receiver or the trustee, at any time summon - (a) the bankrupt ... to attend ... before the Court or the Registrar ... to give evidence concerning ... the bankrupt or his trade dealings, property or affairs." Upon Mr. Jolliffe''s application, Deputy Registrar Inga summonsed the appellant to attend before the Registrar on 27 May 1987 to give evidence in connection with a number of matters. She did so by a summons dated 9 April 1987, which was in the normal form of a summons under s.81 of the Act. Upon further applications made by Mr. Jolliffe in the same capacity, another Deputy Registrar issued summonses under s.81]1 directed to the secretaries of two companies which were said to hold documents relating to the debtor or his trade dealings or affairs. Those companies were Cadoplum Pty Limited and Laitier Pty Limited. 4. The two companies and the appellant took out applications to review, pursuant to s.14(5) of the Act, the decision of the Deputy Registrar which led to the issue of each of the summonses. On a number of grounds, it was sought to have the summonses set aside. The appellant's application failed on all the grounds upon which it was originally based. However, during the course of argument before the learned Judge who heard it, leave was granted to the appellant to amend his application in order to rely on the proposition that the direction purportedly given under s.15(4) to Mr. Jolliffe was ineffective because he was not an "officer" within the meaning of the provision. Accordingly, so it was suggested, the applications for the issue of the summonses were not made by a person entitled to make them, so that the summonses were not able to be validly issued. This argument was also determined against the appellant and his application was dismissed. From that order he appeals. The sole ground of appeal urged was that there was no power to support the direction purportedly given to Mr. Jolliffe under s.15(4) of the Act because, so it was said, he was not an "officer". Counsel for the appellant did not argue that if Mr. Jolliffe was an officer to whom the Inspector-General was empowered to issue a direction, there was any ground for setting aside the direction. It 1S unnecessary to consider whether, in proceedings to review the issue of a summons under s.81, 1t is possible to make 5. a collateral attack upon the direction under s.15(4) by virtue of which it came about that the applicant was permitted to exercise the powers of the Official Receiver. (See article by Sir Owen Dixon on De Facto Officers (1938) 1 Res Judicatae 285 reprinted in Jesting Pilate at p.229; Rubinstein on Jurisdiction and Illegality (1965) pp.205 et seq; Scadding v. Lorant (1851) 3 H.L.C. 418 at 447-8; 10 E.R. 164; Vardon v. O'Loghlin (1907) 5 C.L.R. 201 at 204, 208, 214; Hughes v. Hughes (1971) 19 F.L.R. 81 at 88 et seq.; The Queen v. Cawthorne; Ex parte Public Service Association of South Australia Incorporated (1977) 17 S.A.S.R. 321.) Since, under s.14(5), the Court was reviewing on summary application the action of the Registrar in issuing the summonses, the standing of Mr. Jolliffe to seek the issue of the summonses May be open to be contested. (Cf. The Queen v. Cawthorne; Ex parte Public Service Association of South Australia Incorporated supra, at 333). Whether 1t is so open may depend on the nature of the review for which s.14(5) provides. Section 15 of the Act provides as follows: "(1) There shall be for each District an Official Receiver and such officers to assist the Official Receiver in the performance of his functions under this Act as are necessary. (2) The Official Receivers shall be under the control of the Court. (3) Each Official Receiver has such powers and functions as are conferred or imposed on an Official Receiver by this Act. (4) The Inspector-General may, by writing under his hand, direct an officer to exercise or perform, for such period as is specified in the direction or until the direction is terminated, all of the powers, functions or duties of an Official Receiver under this Act 6. or such of those powers, functions or duties as are specified in the direction. (5) A power, function or duty of an Official Receiver under this Act, when exercised or performed by an officer in accordance with a direction given by the Inspector-General under sub-section (4), shall, for the purposes of this Act, be deemed to have been exercised or performed, as the case requires, by an Official Receiver." In reading this section it is necessary to bear in mind that s.5(1) provides: "In this Act, unless the contrary intention appears - 'officer' means an officer of the Court or of the Commonwealth; 'Official Receiver' includes a person acting as an Official Receiver ... ." Counsel for the appellant conceded that a deputy registrar is an officer of the Commonwealth. However, she argued that the context of s.15(4) indicates a contrary intention so as to confine the word "officer", used in that provision, to an officer of the Official Receiver or to some other officer not including a deputy registrar. The concession seems properly made. There is no reason why the expression "officer ... of the Commonwealth" should be construed in any sense different from that which is familiar in Australia in relation to officers of states. That sense is well indicated in two Privy Council appeals from New South Wales, Walker v. Simpson [1903] A.C. 208 and Williams v. Macharg [1910] 7. A.C. 476. The latter case affirmed the decision of the High Court in Williams v. Macharg (1908) 7 C.L.R. 213. It 1s clear from p.221 of the High Court report that Griffith C.J. thought it appropriate to refer to a messenger in the Public Service as an officer. It is also clear from the judgment of O'Connor J. at p-228 that he thought a broad meaning is to be attached to the word "officer", quite apart from the statutory definition contained in the New South Wales Act there in question. O'Connor J. thought the word applied to a draftsman in the New South Wales Public Service. Isaacs J., at p.231, accepted the view that an officer was "a member of the Service". It is apparent both from the judgments in the High Court and in the Privy Council that the word "officer" was understood, with relation to the Public Service, in a very broad sense. That sense 1S an appropriate one to have been taken up by the legislature when enacting the Bankruptcy Act, and 1t would embrace a deputy registrar. There is no need to consider whether a deputy registrar is also an "officer of the Commonwealth" within the meaning of s.51(xxxix) and s.75(v) of the Constitution, or an officer of the Executive Government of the Commonwealth within the meaning of s.67 of the Constitution. In s.12(1)(c) of the Bankruptcy Act the Inspector-General is empowered to obtain "from Registrars, Official Receivers and other officers ... reports as to the operation of this Act." It is clear that the draftsman of this section regarded registrars as officers, and it can scarcely be doubted that a deputy registrar would be an "other officer" within the sub-section. A still wider power is conferred upon 8. the Inspector-General by s.12(2)(d), to "appoint an Official Receiver, Registrar, Deputy Registrar or any other person, in writing, to conduct an inquiry or investigation on behalf of the Inspector-General." A deputy registrar is here expressly made a possible senior agent in the Inspector-General's sphere of authority. The degree to which a deputy registrar may be equated with a registrar is indicated by s.14(2) which provides that each Registrar and Deputy Registrar has such powers and functions as are conferred or imposed on a Registrar by the Act. In s.19A(3) reference 1s made to "the Inspector-General, a Registrar, a Deputy Registrar, an Official Receiver, an officer performing any of the functions or duties, or exercising any of the powers, of an Official Receiver or an officer or other person assisting a Registrar, a Deputy Registrar or an Official Receiver in the performance of his functions or duties or the exercise of his powers." In s.19B it is provided: "All Registrars, Deputy Registrars, Official Receivers, officers and other persons having functions, powers or duties under this Act shall, within the limits of their respective functions, powers and duties under this Act, severally act in aid of and be auxiliary to each other in all matters of bankruptcy." These provisions suggest a functional and administrative proximity linking registrars and deputy registrars with official receivers. They also refer to officers in contexts free from any limitation to those officers subordinate or not subordinate to particular functionaries. 9. In its setting in the Act, as part of a series of sections treating the administration of bankruptcy as a single area with several associated centres of administration, s.15(4) cannot easily be construed as impliedly showing an intention to use the word "officer" in other than its defined sense. The context does not make such a rigid separation between officers whose primary functions relate to the registry, the office of the Inspector-General, and the office of an official receiver as the appellant's contention requires. It is to be noted that sub-s.(4) does not refer back to sub-s.(1), as a draftsman who intended to do so could easily have provided, but is worded consistently with the other sections which have been cited. The section should be construed in accordance with the definition of "officer" in s.5. However, it was argued for the appellant that what was done involved a deputy registrar applying for the issue of a summons to another deputy registrar. That was said to offend against principles of natural justice. Unless the suggested problem is such as to affect the construction of the provision, the point 1s not available; for the appeal is limited to the question of power. But it cannot be said that any appointment of a deputy registrar under s.15(4) will necessarily bring about an improper collision between the duties of the offices performed by him. The scheme of the provisions in which s.15(4) is set is entirely opposed to such an idea. The appellant's argument cannot prevail against the whole context of the section. Nor is there in reality any objection of substance to a person who happens in a different capacity to be a deputy registrar 10. applying, in the capacity of an officer directed by the Inspector-General under s.15(4) to perform certain duties, to another person who is a deputy registrar, for the issue of a summons .« No question was raised by the respondent whether the decision under appeal was a final decision from which an appeal lies as of right, or whether it was interlocutory, leave to appeal being required. If we had been of the view that leave was required we would have granted it, since it 1s a matter of importance in the administration of the bankruptcy law that the scope of the power conferred by. s.15(4) be clarified. (Cf. Re Nemeth; Ex parte Nemeth (1987) 73 A.L.R. 499 at 502; Dousi v. Colgate Palmolive Pty Ltd (1987) 9 N.S.W.L.R. 374.) The appeal is dismissed with costs. I certify that this and the preceding nine (9) pages are a true copy of the Reasons for Judgment herein of the Court. Any Uioluur Associate Dated: 7 March 1988. Counsel for the Appellant: Solicitors for the Applicant: Counsel for the Respondent: Solicitors for the Respondent: Date of hearing: t ' 1 - oho ' B ' ' ' i , © 4 . ' Py ty es . . ' roy ' qi ' ' ' ' . ' - . ' me - retry . ~ - ; ' ' , " sat my ' ' ve 1 - " 1 . ct , c hy ft - 41 . 24 \ ' ; F FE - : eos ' Lee . oa oy 4 ' ' ll. Miss M. Beazley I. Abelitis & Co. Mr. A. Robertson Australian Government Solicitor 24 February 1988