Barton v Deputy Commissioner of Taxation (Cth) [1974] HCA 43

High Court of Australia Menzies, Gibbs and Stephen JJ. Barton v Deputy Commissioner of Taxation (Cth) [1974] HCA 43

ORDER Appeal dismissed with costs.

Cur. adv. vult.

The following written judgments were delivered:—

Oct. 30 Menzies J.

I have read the judgment of Stephen J. and I agree with it.

Gibbs J.

The sequestration order in this case was rightly made and the appeal should be dismissed for the reasons given by my brother Stephen, with which I agree.

Stephen J.

On 23rd August 1974, the estate of the appellant, Thomas Barton, was sequestrated, the act of bankruptcy upon which the order was made being the act of the debtor in remaining out of Australia with intent to defeat or delay his creditors.

The original petitioning creditor was A. T. Investments Pty. Ltd. (in liquidation) whose petition was filed on 28th August 1973, soon after it had gone into liquidation. It petitioned as a creditor of the appellant in the sum of $1,250, being money lent by it to the appellant between 5th and 17th April 1973. The grounds in the petition, three in number, each relied upon an intent on the part of the appellant to defeat or delay his creditors — see Bankruptcy Act 1966 Cth s. 40 (1) (c). Originally only two grounds were alleged, the debtor's departure out of Australia and his departure from his dwelling house, in each case with this intent. By an amendment on 4th September 1973 a third ground, that upon which the sequestration order ultimately came to be made, was added; it read "with intent to defeat or delay his creditors the debtor remains out of Australia". It is undisputed that on 17th April 1973 the appellant left Australia, to which he has apparently not since returned.

On 23rd October 1973 the matter came before the learned trial judge upon an application by the original petitioning creditor for an order for substituted service and on that date there was paid to it the sum of $1,250 owed to it. However in the meantime, on 20th June 1973, a notice of assessment to income tax issued in respect of the assessable income of the appellant for the year ended 30th June 1972 under which over $77,000 became payable on 23rd July 1973 and on 10th December 1973 an order was made for the substitution of the Deputy Commissioner of Taxation for the original petitioning creditor. It was on the petition of this substituted petitioning creditor that the order for sequestration was eventually made in August 1974.