National Discounts Ltd v Jaques; Re Doyle [1955] HCA 54

93 C.L.R.] OF AUSTRALIA. 449

[HIGH COURT OF AUSTRALIA.]

NATIONAL DISCOUNTS LIMITED... APPELLANT ; 'RESPONDENT, AND JAQUES AND OTHERS ' . : . _ResponpDENTs.

APPLICANT-RESPONDENTS,

Re DOYLE.

Bankruptcy—* Commencement of the bankruptcy "— Property of the bankrupt" — 4. ©, or A. Motorcar—' Possession" of the bankrupt—Order or disposition—Reputed 1955, ownership—Consent of the true owner—Bill of sale—Rights—Statutory protection = 7 —Bankruptey Act 1924-1950, s. 91 (e), (iii), (iv)—Bills of Sale Act 1898- SypNEY, 1938 (N.S.W.). Aug. 24-26;

Section 91 of the Bankruptcy Act 1924-1950 (Cth.), so far as material, is MerourNe, as follows :—" The property of the bankrupt divisible amongst his creditors ct, 20. . shall not include :—. . . (e) except as provided in paragraph (iv.) of

Williams,

this section . . . chattels in respect of which a valid bill of sale has been Fullagar and filed or registered and kept registered under any Act or State-Act or law ofa "81" 4¥- Territory . . . But, subject to this Act, it shall include—. . . (iii) all goods

being, at the commencement of the bankruptcy, in the possession, order, or disposition of the bankrupt, with the consent and permission of the true owner, under such circumstances that he is the reputed owner thereof: . . « and (iv) the claim or right of the bankrupt to the property under any contract, bill of sale, hire purchase agreement, mortgage or lien made by or with the bankrupt or debtor on his trustee discharging or offering to discharge any legal liability with respect thereto."

Held: (1) Paragraph (e) operates only to protect the proprietary rights in the goods created by the instruments to which it refers. It permits the true owner of such rights to leave such goods in the possession, order or disposition of the debtor under such circumstances that he is the reputed owner thereof without incurring the penalty of the forfeiture of those rights if the debtor becomes bankrupt. The paragraph does not operate to protect the true owner of the goods if they are not in fact the property of the bill of sale holder. (2) Goods can never form part of the property of the bankrupt by reason of the operation of s. 91 (iii) unless the true owner has consented to their being,