High Court of Australia Kitto, Taylor, Menzies, Windeyer and Owen JJ. Robert Reid Pty Ltd v Cassidy [1966] HCA 7 ORDER Appeal dismissed with costs. Cur. adv. vult. The following written judgments were delivered:— 1966, Feb. 25 Kitto J. The question in this appeal is whether a debtor commits an act of bankruptcy by making a payment which would be void as a preference if he became bankrupt. It is a question as to the true interpretation of s. 52 (c) of the Bankruptcy Act 1924-1960 Cth, which provides that a debtor commits an act of bankruptcy if he "makes any conveyance or transfer of his property, or any part thereof, or creates any charge thereon which would, under this or any other Act be void as a preference or a fraudulent preference if he became bankrupt". In this case a debtor, the present respondent, made a payment which, if he became bankrupt, would be void as a preference by force of the provisions of s. 95 of the Act. Is such a payment a "conveyance or transfer" of a part of his property within the meaning of s. 52 (c)? In a series of decisions Clyne J., as Federal Judge in Bankruptcy, has answered the question in the negative, and this appeal is from the latest of those decisions. His Honour's view is opposed to that of his predecessor, Lukin J., and of Paine J. in South Australia. Moreover it is opposed to dicta in two judgments delivered by members of this Court: Richardson v. The Commercial Banking Co. of Sydney Ltd. [3] and Rae v. Samuel Taylor Pty. Ltd. [4] ; but the considerations favouring the interpretation adopted by Clyne J. were not before the Court in either of those cases, and we must, I think, examine them now. 1. (1952) 85 C.L.R. 110, at p. 128. 2. (1963) 110 C.L.R. 517, at p. 523. The most important of these considerations is to be found in the striking contrast between the language of s. 52 (c) and the language of s. 95. It is a contrast for which there does not seem to be anything to account in the legislative history of the provisions. It seems beyond doubt that in the drafting of s. 52 (c) a deliberate choice has been made of some of the matters which s. 95 renders void as preferences if certain conditions are satisfied, to the exclusion of the others of those matters. There are six such matters altogether: every conveyance of property, every transfer of property, every charge upon property, every payment made, every obligation incurred, every judicial proceeding taken or suffered. Plainly enough, the draftsman must have decided as a matter of policy not to make the incurring of an obligation or the taking or suffering of a judicial proceeding an act of bankruptcy, even where they would be void under s. 95 if the debtor became bankrupt. It is impossible to suppose that he omitted to mention them because they were comprehended by the expression "conveyance or transfer" in s. 52 (c): they simply could not be. Then what is the explanation of the other omission from s. 52 (c) of a matter specified in s. 95? Is it that the draftsman thought that for the purposes of s. 52 (c), though not for the purposes of s. 95, the words "conveyance or transfer of his property or any part thereof" were sufficient to make it clear that a payment of money was included? That seems hardly likely. The specification of acts of bankruptcy was at least as much a matter for meticulous care to place the meaning beyond doubt as was the specification of matters capable of being void as preferences. The only reasonable explanation, as it seems to me, is that it was decided as a matter of positive intention to exclude preferential payments from the classes of dealings which should be acts of bankruptcy. The contrast between the two provisions seems to me far too obvious, far too pointed, to be satisfactorily explained on any other footing. Jenkins L.J. seems to have taken the same view in relation to the corresponding provisions of the English Act when he said, with the concurrence of Hodson and Romer L.JJ., in Re a Debtor; Ex parte The Debtor v. National Provincial Bank Ltd. [1] that: "it seemed questionable whether a mere payment was a "conveyance or transfer of property" within s. 1 (1) (c) [the act of bankruptcy provision of the English Act], which did not expressly mention payments, particularly in view of the fact that s. 44 of the Act (which dealt with fraudulent preferences) did expressly mention payments as well as conveyances or transfers" [2] . The word "particularly" in this passage seems to show that his Lordship's doubt, while strengthened by the contrast between the two provisions, was primarily a doubt as to whether "conveyance or transfer of property" was apt to comprehend a payment of money. Some payments of money, of course, are made by means of a transfer of property in the form of coins or Commonwealth notes. Some are only in a loose though practical sense to be described as involving a transfer of property, as where a debtor by means of a cheque (which is not an assignment) procures his banker to carry through a process which results in a credit in account in favour of the creditor and a debit in account against the debtor. The intention can hardly be to erect the former into acts of bankruptcy but not the latter. A more important consideration, however, is to be found in the natural meaning of the words "conveyance", "transfer" and "charge", as used in relation to property. No doubt the first two of those words may be used in an appropriate context to include a payment of money, but normally they connote the execution of a formal instrument. In this connexion it is important to observe the contrast in s. 52 itself between pars. (a) and (c) on the one hand and par. (b) on the other. In (a), the expression "conveyance or assignment", and in (c) "conveyance or transfer or charge," provide the only descriptions of the kinds of dealings to which the paragraphs are to apply; whereas in (b) "conveyance" and "transfer" are supplemented by "gift" and "delivery". It is to these wide words that cases such as Ex parte Simpson; In re Hunt [1] ; Ex parte Halliday; In re Liebert [2] and Ex parte Stubbins; In re Wilkinson [3] are relevant. Under provisions which speak only of "conveyance or assignment" or "conveyance or transfer" it is in point to recall what Fry L.J. said in In re Spackman; Ex parte Foley [4] in a passage quoted with approval by Bankes L.J. in B. Lipton Ltd. v. Bell [5] : "I think that the language of sub-s. 1 (a) and sub-s. 1 (b) respectively must be contrasted in order to arrive at the meaning of the words "conveyance or assignment" in the former. Sub-s. 1 (a) speaks of "conveyance or assignment." Sub-s. 1 (b) speaks of "conveyance, gift, delivery, or transfer." Having regard to the language so used, it seems clear to me that the legislature must have had in their minds the fact that there are other modes of disposition, by which property may be rendered subject to be applied for the benefit of creditors, besides a conveyance or assignment in the proper sense of those terms. The debtor himself might declare himself to be a trustee of his property for the benefit of creditors. Such a mode of disposing of property is well known to the law; but it is not an assignment in the proper sense of the term. Again, property may be dealt with in various other modes, e.g., by agreement to assign, by payment, or by delivery. All these are modes of disposition by which property may be dealt with for the benefit of creditors, but which are not properly assignments; yet we find that the legislature, which uses the expressions, "gift, delivery, or transfer," in sub-s. 1 (b), only uses the expressions "conveyance or assignment" in sub-s. 1 (a). It appears to me, therefore, plain that, though they had in their minds the fact that there were many other modes of dealing with property, they were dealing in sub-s. 1 (a) with "conveyance or assignment" only" [1] . 1. [1952] 1 All E.R. 519. 2. [1952] 1 All E.R., at p. 521. 3. (1844) 14 L.J. Bkpty. 1. 4. (1873) L.R. 8 Ch. App. 283. 5. (1881) 17 Ch. D. 58. 6. (1890) 24 Q.B.D. 728. 7. [1924] 1 K.B. 701, at pp. 709, 710. 8. (1890) 24 Q.B.D., at pp. 740, 741. Likewise it seems to me that s. 52 (c) should be taken to be deliberately restricted to conveyances, transfers and charges in the sense in which those expressions are normally used to describe known types of dealings with property. It could seem likely that Viscount Simonds, Lord Oaksey and Lord Normand would agree; and there is no reason to suppose that in the context provided by pars. (a) and (b) and s. 95 Lord Radcliffe or Lord Tucker would dissent: cf. St. Aubyn v. Attorney-General [2] . 1. [1952] A.C. 15, at pp. 32, 37, 43, 57, 60. It is said, in effect, that an interpretation of s. 52 (c) which would exclude a payment of money from the classes of transactions referred to in it would attribute to the legislature a choice which is not to be explained on any rational ground. This does not appear to me to be so. There is a difference, and an important one, between the giving of a preference by means of a conveyance or a transfer or a charge, if those words be understood in a formal, conveyancing sense, and the giving of a preference by means of a payment or the incurring of an obligation or the taking or suffering of a judicial proceeding. The difference, which might understandably have governed the legislature's selection, lies in the element of deliberation which the formality involved in a conveyance, transfer or charge necessarily requires. A debtor who gives a preference with such a degree of deliberation has full opportunity to appreciate the significance of his conduct; whereas one who gives a preference by any of the other steps which s. 95 makes void may have, but may not have and in many cases has not, anything like the same opportunity. This may well have been thought particularly important by a draftsman who was making a choice among transactions which he intended to make void as de facto preferences regardless of the debtor's purpose or intent. In my opinion Clyne J. correctly interpreted s. 52 (c) and the appeal should be dismissed. Taylor J. On 22nd February 1965, the appellant presented a petition in bankruptcy for the sequestration of the estate of the respondent on the ground that he had within six months before the date of the presentation of the petition made a payment of the sum of £64 0s. 11d. to D. & W. Murray (Australia) Limited which payment would be void as a preference under the Bankruptcy Act 1924 (as amended) if he became bankrupt. The petition was dismissed Clyne J. holding that the payment as alleged was not an act of bankruptcy within the meaning of s. 52 (c) of the Act. That sub-section provides that a debtor commits an act of bankruptcy "If in Australia or elsewhere he makes any conveyance or transfer of his property, or any part thereof, or creates any charge thereon which would, under this or any other Act be void as a preference or a fraudulent preference if he became bankrupt" and the ground upon which the petition was dismissed was that a payment of a sum of money is not a "conveyance or transfer" of property within the meaning of this provision. It may be observed that "property" is defined as "money, goods, things in action, land, and every description of property, whether real or personal and whether situate in Australia or elsewhere". But s. 95 of the Act, which deals with the avoidance of preferences, was thought to draw a distinction between a "conveyance or transfer of property" and a "payment" and, upon a comparison of the two sections, the conclusion was reached that by the use of the relevant expression in s. 52 (c) no reference was intended to a payment of money which would be void as a preference under s. 95. There is no suggestion that, having regard to the definition of "property", the expression in s. 52 (c)—"any conveyance or transfer of property"—is not of itself comprehensive enough to include a payment of money; the conclusion simply rests upon the basis that s. 95 draws a distinction and that this is reflected in the language of the earlier sub-section. This was the view entertained by Clyne J. in Re Bailey; Ex parte Law v. O'Brien [1] and he adhered to it in the present case. But it is a view which is opposed to the decisions of Lukin J. in Re Hardman [1] ; Re Sotiros [2] ; and Re Docker [3] and to that of Paine J. in Re Bryan [4] . Additionally, it is contrary to the observations of this Court in Richardson v. The Commercial Banking Co. of Sydney Ltd. [5] and to those made in Rae v. Samuel Taylor Pty. Ltd. [6] . It may be observed that the earlier case was decided before Bailey's Case [7] but it is not without some importance to notice that it was not before Clyne J. when he decided that case. 1. (1954) 16 A.B.C. 180. 2. (1932) 4 A.B.C. 207. 3. (1931) 4 A.B.C. 125. 4. (1938) 10 A.B.C. 198. 5. (1943) 13 A.B.C. 99. 6. (1952) 85 C.L.R. 110, at p. 128. 7. (1963) 110 C.L.R. 517, at p. 523. 8. (1954) 16 A.B.C. 180. As already appears the decision in Bailey's Case [7] proceeded mainly on the basis that the word "payment" appears in s. 95 whilst it is absent from s. 52 (c). But I do not think that the question can be resolved merely upon a comparison of these two sections; in my view, it is necessary to have some regard to the history of bankruptcy legislation in so far as it throws light on the meaning to be attached to traditional forms of expression which it has more or less consistently employed. (See per Lord Esher In re Spackman; Ex parte Foley [8] .) 1. (1954) 16 A.B.C. 180. 2. (1890) 24 Q.B.D. 728, at p. 738. In the early days of bankruptcy law the making of a conveyance or transfer of property by a debtor could not constitute an act of bankruptcy. But by the Statute 1 Jac. 1, c. 15, it was provided that "if any trader shall make or cause to be made any fraudulent grant or conveyance of his lands, tenements, goods, or chattels, to the intent or whereby his creditors shall or may be defeated or delayed for the recovery of their just and true debts, he shall be adjudged a bankrupt". However, it was decided that a fraudulent conveyance or transfer of a debtor's property otherwise than by deed was not within the scope of this provision. Much later, by 6 Geo. 4, c. 16, s. 3, it was enacted that if a trader should make or cause to be made any fraudulent grant or conveyance of any of his lands, tenements, goods, or chattels, or make or cause to be made any fraudulent gift, delivery, or transfer of any of his goods and chattels, with intent to defeat or delay his creditors, he should be deemed to have thereby committed an act of bankruptcy. Thereafter it was held, notwithstanding contextual difficulties not dissimilar from those which present themselves in the present case, that the payment of money by a debtor to a creditor by way of fraudulent preference was an act of bankruptcy within the scope of this provision (Montagu and Ayrton's Laws and Practice in Bankruptcy, pp. 825, 897 and Ex parte Simpson [9] ). The same view was taken by Lord Selborne and Mellish and James L.JJ. in Ex parte Halliday [10] notwithstanding, again, much the same contextual difficulty as presents itself in the present case. The collocation of words in s. 92 of the Bankruptcy Act, 1869 descriptive of transactions which might be invalidated under that section was "Every conveyance or transfer of property, or charge thereon made, every payment made, every obligation incurred, and every judicial proceeding taken or suffered" and s. 6 (2) of the Act specified as an act of bankruptcy "a fraudulent conveyance, gift, delivery, or transfer of his (the debtor's) property or any part thereof". Likewise, payments of money were held to constitute dispositions of property within the meaning of the general words of 13 Eliz., c. 5, in spite of the fact that that enactment did not contain any such comprehensive definition of the expression "property" as is now to be found in the Commonwealth Act: (Barrack v. M'Culloch [1] ; French v French [2] and In re Eichholz dec'd. [3] ). I observe also that payments of money have always been regarded as falling within the expression "any conveyance or transfer of property" as used in sub-s. (3) of s. 94 of the Commonwealth Act and earlier provisions of a like character, and, therefore, that payments of money may constitute settlements of property within the meaning of those provisions (In re Player; Ex parte Harvey [4] ; In re Tankard; Ex parte Official Receiver [5] ; In re Plummer [6] ; and Williams v. Lloyd [7] ). 1. (1844) 8 Jur. 1150. 2. (1873) L.R. 8 Ch. App. 283. 3. (1856) 3 K. & J. 110 [69 E.R. 1043]. 4. (1855) 6 De G.M. & G. 95 [43 E.R. 1166]. 5. [1959] 1 Ch. 708, at p. 722. 6. (1885) 15 Q.B.D. 682. 7. [1899] 2 Q.B. 57. 8. [1900] 2 Q.B. 790. 9. (1934) 50 C.L.R. 341, at pp. 364, 375, 376. From the above observations it is clear that an actual payment of money by a debtor to a creditor has been held to be comprehended by such expressions as "any delivery or transfer of any of his goods or chattels", "a conveyance, gift, delivery or transfer of his property or any part thereof" and "any conveyance or transfer of property". Why then have the successive Bankruptcy Acts in England—1869 s. 92, 1883 s. 48 and 1914 s. 44— in prescribing the conditions upon which transactions may be invalidated by a trustee as fraudulent preferences, consistently referred to "payments" in addition to "conveyances and transfers of property". The simple answer, it seems to me, is that, notwithstanding the same wide definition of property as that which appears in the Commonwealth Act, it may have been thought that the latter expression might not be appropriate to describe all transactions falling within the concept of payment. I refer to transactions of the character considered in In re Harmony and Montague Tin and Copper Mining Co.—Spargo's Case [1] ; Larocque v. Beauchemin [2] ; and North Sydney Investment and Tramway Co. Ltd. v. Higgins [3] . It may well be that it was thought that it was open to question whether a "payment", to the extent to which it was effected by a settlement of mutual accounts, did not involve a conveyance or transfer of property. I do not wish to suggest that a payment of this character does not; indeed, it has frequently been held that it does (e.g. Re Smith [4] ). But it provides an explanation for the presence of the word "payment" in the relevant legislative provisions, not for the purpose of confining the meaning of the expression "any conveyance or transfer of property" but for the purpose of extending the operation of the section to "payments" which might possibly not be thought to amount to conveyances or transfers of property as so amply defined. 1. (1873) L.R. 8 Ch. App. 407. 2. [1897] A.C. 358. 3. [1899] A.C. 263. 4. (1933) 6 A.B.C. 49. The Bankruptcy Act 1924 (which came into force in the Commonwealth on 1st August 1928) was enacted as a uniform bankruptcy law for the Commonwealth. As such, it replaced the bankruptcy legislation of each of the six States and it is of interest to notice the varying provisions of the State Acts in relation to the problem now under consideration. In Victoria the Insolvency Act 1928 by s. 151 provided that: "Every conveyance or transfer of property or charge thereon made, every payment made, every obligation incurred, and every judicial proceeding taken or suffered by any person unable to pay his debts as they become due from his own moneys in favour of any creditor or any person in trust for any creditor, with a view of giving such creditor a preference over the other creditors shall, if the person making taking paying or suffering the same becomes insolvent within three months after the date of making taking paying or suffering the same, be deemed a fraudulent preference and fraudulent and void as against the assignee or trustee of the insolvent estate appointed or elected under this Act". There is no doubt that a payment voidable under this section would have constituted an act of insolvency for s. 49 (11) declared as such the giving or making of any preference to or in favour of any creditor which would if the estate of such debtor were sequestrated under the Act be a fraudulent preference of such creditor. There may, possibly, be some question whether the position was the same in South Australia where s. 161 of The Insolvent Act, 1886 was in terms similar to s. 151 of the Victorian Act whilst, by s. 57, it was declared that a debtor should be deemed to have committed an act of insolvency if he should make "any fraudulent grant or conveyance of any of his lands, tenements, goods, or chattels, or make or cause to be made any fraudulent gift, delivery, or transfer of any of his goods or chattels". The reason for my doubt on this point is that, notwithstanding the fact that the Act contained the same wide definition of "property" as had consistently been employed in bankruptcy legislation, s. 57 did not use this expression. However, in spite of a change of language, the position under the legislation of Queensland, Western Australia and Tasmania left little, if any, doubt that a preferential payment was an act of bankruptcy. The relevant preference sections in the legislation of those States were in substantially similar terms to those of s. 151 of the Victorian Act and s. 161 of the South Australian Act and each of the Acts of the States referred to declared that a debtor commits an act of bankruptcy if he makes a fraudulent conveyance, gift, delivery, or transfer of his property or of any part thereof. (The Insolvency Act of 1874 Q., s. 44 (2), The Bankruptcy Act, 1892 W.A., s. 4 (1) (b), and The Bankruptcy Act, 1870 Tas., s. 5 (2).) In New South Wales the legislation took a somewhat different form. The preference section—Bankruptcy Act, 1898, s. 56— did not specifically mention the word "payment"; it provided that: "Every alienation, transfer, gift, surrender, delivery, mortgage, or pledge of any estate or property, real or personal, every warrant of attorney or judicial proceeding made, taken, or suffered by a person being at the time insolvent or in contemplation of surrendering his estate under this Act, or knowing that proceedings for placing the same under sequestration have been commenced, or within sixty days before the sequestration thereof, and, whether fraudulent or not, having the effect in any such case of preferring any then existing creditor to another shall be absolutely void". Originally, however, s. 56 of the Bankruptcy Act, 1887 had included an express reference to payments but this section was repealed by 60 Vict. No. 29 and in the 1898 Act the section was re-enacted in its new form. But it is clear enough from the protective provisions of s. 57, notwithstanding the omission of the reference to "payment", that the opening words of s. 56 in its new form were intended to comprehend a payment by a debtor to a creditor (per Griffith C.J. in Williams v. Dunn's Assignee [1] where this Court had before it questions concerning the interaction of the difficult provisions of ss. 56, 57 and 58). There was, therefore, no such difficulty as presents itself in this case for a payment of money could both constitute an "alienation" or a "transfer" or a "delivery" of property within the meaning of s. 56 and a "conveyance or transfer of property" within the meaning of s. 4 (c) and, therefore, an act of bankruptcy. But the matter was further complicated because the latter section specified as an act of bankruptcy a conveyance or transfer of property which would "under this or any other act be void as a fraudulent preference". Now s. 56 rendered void in certain circumstances transactions "having the effect of preferring any then existing creditor" and did not deem any such transaction to be fraudulent so that the words of s. 4 (c)—"which would under this (or any other) Act be void as a fraudulent preference"—were quite inapt to refer to transactions avoided by s. 56. No doubt, however, a payment voidable under 13 Eliz., c. 5, was a fraudulent preference and the reference to transactions void as fraudulent preferences under "any other Act", was appropriate to cover such a case. 1. (1908) 6 C.L.R. 425, at p. 438. In this state of affairs the Parliament of the Commonwealth seems to have selected the English legislation as its model for the new Commonwealth Act of 1924. This was a process which had already been followed in several of the States. But it adopted s. 44 of the English Act of 1914 with two important changes which should be noticed; under s. 95 of the Commonwealth Act it was sufficient to establish that a transaction of the kind designated by the opening words of the section had the "effect" of preferring a creditor and it was unnecessary to show that it had taken place "with a view" to giving a creditor a preference over the other creditors. But such a preference was not, as in England, deemed to be fraudulent. However the section retained the same collocation of words to describe the transactions to which it applied. Then s. 52 (c) of the Commonwealth Act followed s. 1 (c) of the English Act precisely, except that the former provision, as was necessary, expanded the expression used in the English Act to include conveyances or transfers of property which would "under this Act or any other Act be void as a preference or a fraudulent preference ". With this legislative history in mind I am not disposed to think that by the use of the word "payment" in s. 95 the legislature intended to confine the meaning of the expression "conveyance or transfer of property" and, thereby, to exclude from the character of an act of bankruptcy, payments made in such circumstances as to constitute voidable preferences. Rather, I think, the word "payment" found its way into s. 95 (and its predecessors) merely to ensure, as I have already said, that a transaction amounting in law to a payment, but which might be thought not to involve a conveyance or transfer of property, would also be covered by the section. That transactions of this limited character are not expressly mentioned in s. 52 (c) is, I think, of no significance and may be explained by the legislative history of the provision. Nor, is there any reason why a preferential payment should be excluded from the provisions of s. 52 (c). Such a payment is just as obnoxious to the bankruptcy laws as a preferential conveyance or transfer of any other property and I can see no reason for concluding that the legislature intended transactions of the latter character to qualify as acts of bankruptcy and transactions of the former class to be excluded so that a debtor would commit an act of bankruptcy if he conveyed realty to a creditor but not if he sold the realty, and, thereafter, parted with the proceeds to a creditor. Indeed it would, I think, be a mistake to suppose that, in using the language which it did, the legislature intended to make such a radical change from the law as it existed generally in the several Australian States. It is clear enough when regard is had to the fact that, by definition, "property" includes money, goods and things in action that the expression "conveyance or transfer", when used in relation to "property", cannot be confined to instruments conventionally described as conveyances or transfers; it must be regarded as wide enough to comprehend all dealings whereby the title to money, goods and things in action is disposed of and, as such, wide enough to cover a payment of money. I do not think that this conclusion is affected by the fact that there is authority for the proposition that the expression " conveyance or assignment of his (the debtor's) property to a trustee or trustees for the benefit of his creditors generally", as it appears in s. 4 (a) of the Bankruptcy Act, 1883 (the equivalent of s. 52 (a) of the Commonwealth Act), means a formal assignment by a deed of the debtor's property to a trustee for the benefit of creditors: (In re Spackman [1] ). That provision related to assignments of all or substantially all of the property of the debtor and it had an independent history: "There was a well-known meaning attached to the term "assignment" in bankruptcy law, as used in relation to this subject" and it was necessary to construe the statutory provision, having regard to the known meaning and acceptation of the phrase in bankruptcy law before the Act. But when sub-s. (c) of s. 52 of the Commonwealth Act speaks of a conveyance or transfer of a debtor's property or any part thereof which would under that or any other Act be void as a preference or fraudulent preference if he should become bankrupt, the critical words must, as I have already said, be understood to refer to any dealing whereby any part of his property, as so amply defined, is transferred to another person. The choice, as I see it, is between giving the critical expression this meaning or understanding it to denote only a formal instrument of conveyance or transfer. But the provision speaks of a conveyance or transfer of any part of his property and, having regard to the definition of that term, must be taken to comprehend dealings by which items of personal property may be transferred. The property in many items of personal property such, for instance, as bearer bonds, jewellery and other chattels pass upon delivery and dispositions so made fall, clearly enough, within the expression "conveyance or transfer of property" as used in s. 95 and there is no reason to doubt that they fall also within the meaning of the same expression when used in s. 52 (c). But the essential character of a payment, except when the word is used to denote a transaction of the kind under consideration in Spargo's Case [1] , is, also, the transfer, by delivery, of money or a valuable security to a payee and, as such, it is, in my view, as much the transfer of property as defined as is the transfer of a chattel and I can see no grounds for distinguishing between them. 1. (1890) 24 Q.B.D. 728. 2. (1873) L.R. 8 Ch. App. 407. There is one other matter to which I should refer. Section 52 (c), with its reference to transactions which are voidable under "any other Act" as fraudulent preferences has been thought apt to cover a dealing voidable under the provisions of 13 Eliz., c. 5, Re Mazok [2] ; and Re Scott [3] . In spite of the provisions of s. 38 of the Acts Interpretation Act 1901-1964, I think that the fact that s. 52 (c) was, with a modification, taken from the provisions of the English Act shows this to be so. Further, I think that since the repeal, in New South Wales, of 13 Eliz., c. 5, by the Conveyancing Amendment Act, 1930, the reference in s. 52 (c) of the Bankruptcy Act to transactions void as a fraudulent preference under "any other Act" may be read as including transactions voidable under s. 37A of the Conveyancing Act, 1919-1954. We have already seen that a payment of money may be voidable under 13 Eliz., c. 5, as a fraud on creditors and the terms of s. 37A amply comprehend such a transaction. That section provides that "every alienation of property, made with intent to defraud creditors, shall be voidable at the instance of any person thereby prejudiced". Now the contextual difficulties which arise as between s. 95 and s. 52 (c) of the Bankruptcy Act do not arise as between the latter section and s. 37A of the Conveyancing Act. Nevertheless, if the view of the learned judge of first instance be accepted an alienation of property in the form of a payment of money which is fraudulent under s. 37A would not constitute a conveyance or transfer of property for the purposes of s. 52 (c). This is a proposition to which I am not prepared to subscribe. 1. (1930) 2 A.B.C. 237, at p. 243. 2. (1931) 4 A.B.C. 8, at pp. 25, 26. I would allow the appeal. Menzies J. Section 52 (c) of the Bankruptcy Act is as follows:— 34. A debtor commits an act of bankruptcy in each of the following cases:— (c) If in Australia or elsewhere he makes any conveyance or transfer of his property, or any part thereof, or creates any charge thereon which would, under this or any other Act be void as a preference or a fraudulent preference if he became bankrupt; .The reference in this provision to a "fraudulent preference" has, so far as I can see, no significance for present purposes, but the reference to a "preference" of necessity carries one forward to s. 95 (1) of the Act. This is as follows:—"95. (1) Every conveyance or transfer of property, or charge thereon made, every payment made, every obligation incurred and every judicial proceeding taken or suffered, by any person unable to pay his debts as they become due from his own money, in favour of any creditor or of any person in trust for any creditor, having the effect of giving that creditor, or any surety or guarantor for the debt due to that creditor, a preference, a priority or an advantage over the other creditors, shall, if the debtor becomes bankrupt on a bankruptcy petition presented within six months thereafter be void as against the trustee in bankruptcy". A payment of money by a debtor to his creditor, whether in cash or by cheque, falls within s. 95 (1), not because it is necessarily within the description of a "conveyance or transfer of property", but because it is directly within the description of a "payment made". The principal question to which this appeal gives rise is whether such a payment, not naturally falling within the description of a "conveyance or transfer of property" for the purposes of s. 95, is nevertheless a "conveyance or transfer" by the debtor of his property for the purposes of s. 52 (c). The first observation I would make is that I cannot think that a distinction for the purposes of either s. 52 or s. 95 ought to be drawn between a payment made in cash and a payment made by cheque. For instance, either would fall within the description of a "payment made" for the purposes of s. 95. In the next place, because a payment made in cash or by cheque would naturally be regarded as a "payment made" by a debtor to his creditor rather than as a "conveyance or transfer" by a debtor to his creditor for the purposes of s. 95, I am not disposed to treat such a payment as a "conveyance or transfer" by a debtor to his creditor for the purposes of s. 52 (c), which is a section intrinsically connected with s. 95. See Re a Debtor [1] . 1. [1952] 1 All E.R. 519, at p. 521. However, I do not rest my judgment merely upon reading s. 52 (c) in the light of s. 95 (1). Whether a payment by a debtor to his creditor is in truth a "conveyance or transfer" by a debtor of his property can perhaps be most easily tested by taking the case of a debtor whose account is in debit giving his creditor a cheque upon his overdrawn account which is in due course honoured by his bank. What would happen in such a case is simply that the debtor's liability to his bank would be increased. It would be inaccurate to say that the debtor has conveyed or transferred any of his property to his creditor. Indeed, it is only when payment is made in cash that it may be thought that the payment could fall within the description of a conveyance or transfer of the debtor's property but, as I have said, a payment in cash should not be considered in isolation from other payments. Furthermore, to pay what one owes, even if the payment be in cash, does not fall easily within the description of a person making a conveyance or transfer of his property to his creditor. As to the nature of a payment in money, see Nussbaum, Money in the Law, pp. 22 et seq. Because, therefore, I do not regard a payment by a debtor to his creditor as naturally falling within the description of a "conveyance or transfer" of the debtor's property to his creditor—see St. Aubyn v. Attorney-General [2] , per Lord Simonds [3] —and because I regard s. 95 as indicating that a payment of money is not a "conveyance or transfer" of property for the purposes of s. 52 (c), I consider that Clyne J. was correct in deciding that a debtor who pays his creditor either in cash or by cheque has not made a "conveyance or transfer" of any part of his property to his creditor for the purposes of s. 52 (c). 1. [1952] A.C. 15. 2. [1952] A.C., at p. 32. We were referred to several observations of members of this Court in Richardson v. The Commercial Banking Co. of Sydney Ltd. [4] and Rae v. Samuel Taylor Pty. Ltd. [5] pointing to a conclusion different from that which commends itself to me. As Clyne J. said, however, these observations were no more than dicta and here it is necessary to consider whether or not what was said without any supporting reasoning is correct. The advantage of full argument upon the actual point has brought me to a conclusion different from that suggested by these observations. 1. (1952) 85 C.L.R. 110. 2. (1963) 110 C.L.R. 517. I have treated this appeal as doing no more than involving a question of the construction of s. 52 (c) and upon this question I have not found any assistance from the history of that section or s. 95 or from decisions dealing with different questions of construction. In my opinion, the appeal should be dismissed. Windeyer J. The question in this case is whether an insolvent debtor who paid his debt to one of his creditors, thereby giving him a preference over others, committed an act of bankruptcy. It is to be assumed that the payment was made in such circumstances that it would be void under s. 95 of the Bankruptcy Act. But does it come within the words of par. (c) of s. 52 of the Act? This provides that a debtor commits an act of bankruptcy "if in Australia or elsewhere he makes any conveyance or transfer of his property, or any part thereof, or creates any charge thereon which would under this or any other Act be void as a preference or a fraudulent preference if he became bankrupt". The word "property" is defined in the Act in very wide terms. It includes money, goods, things in action and much else. Money being thus within the meaning of the term "property", it seems to me impossible to say that, as a mere matter of the words of s. 52 (c), paying money to a man is not making a transfer of property to him. But the question to be decided arises because of the wording of s. 95, which is the most important enactment, perhaps now the only one, to which the words in s. 52 (c) "this or any other Act" refer. Section 95 speaks of "every conveyance or transfer of property, or charge thereon made, every payment made, every obligation incurred and every judicial proceeding taken or suffered". The argument for a construction of s. 52 (c) that is against the appellant may therefore be summarized as follows: The mention in s. 95 of "every payment" as well as of "every conveyance or transfer of property" means that, for the purposes of that section, a payment is not included in the term "conveyance or transfer of property"; then, going back to s. 52 (c), the same distinction must be observed; therefore making a preferential payment is not an act of bankruptcy, although making a preferential conveyance or transfer of property is. What payments should on this basis be excluded from the category of conveyances or transfers is a problem to which I shall come later. It arises because there is nothing in the Act that restricts payments to payments in money. I may however interpolate here, because the matter was discussed during the argument, that I have come to the conclusion that a payment made by a cheque that upon presentation is met is in a relevant sense a transfer of money from payer to payee. If the drawer of the cheque went to the bank accompanied by his creditor, drew the money and then and there paid it to the creditor he would transfer the cash to him: and whether the effect of his drawing the money from the bank resulted in a credit in his account with the bank being reduced or a debit increased would, it seems to me, be immaterial to this result. If, instead of his going to the bank, drawing the money and handing it over, he were to hand over the cheque, the result seems to me to be, as between payer and payee, the same in any relevant sense. I go first to par. (c) of s. 52 of the Act, reading its words and seeking whatever light context, history and the policy of the Act can fairly shed upon their meaning. I do not think that an examination of its history reveals any decisive reason for construing it either for or against the appellant. However, a comparison of the words of par. (c) with those of other paragraphs of s. 52 was much discussed during the argument, and a consideration of the validity of that comparison makes some reference to history necessary. Bankruptcy law is the product of a great number of English statutes going back to the time of Henry VIII, which were consolidated in the nineteenth century, and in their consolidated form transplanted, with various amendments, to Australia. Only a few of those earlier statutes need be mentioned here because all that is important, for present purposes, is to show that the various acts of bankruptcy set out in s. 52 are there described in words that reflect their different origins. Some of them go back as far as 1542 (34 & 35 Hen. VIII, c. 4): others to 13 Eliz. c. 7: others to Acts of 1604 and 1623, 1 Jac. I, c. 15 and 21 Jac. I, c. 19: others to the Act of 1825, 6 Geo. IV, c. 16: others again are of more recent origin. They make their several appearances in s. 52, each still dressed somewhat in its old words. In some cases this is obvious at once; for example, to "keep house" has in this context had a special meaning ever since the embryo bankruptcy law of 1542. It is less obvious in other cases. But it is nevertheless true that, although now collected together in the one statute and standing in juxtaposition in print, the various acts of bankruptcy are not defined in language that is harmonious. An appreciation of history and caution are thus necessary in any attempt to interpret one by comparing its words with those of another. In short, each is better understood by remembering its ancestors than by regarding its neighbours. It is proper too to bear in mind that (using the words of Jordan C.J. in Page v. Commonwealth Life Assurance Society Ltd. [1] ): "The law of bankruptcy is the creature of statute; but, nevertheless, the policy of the bankruptcy law has always been regarded as a useful guide in determining the operation and limitations of the letter of the law". This does not mean that the definitions of acts of bankruptcy are to be loosely interpreted. They should, Lord Bowen said, "be construed as strictly as if they occurred in a section which was defining a misdemeanour, because the commission of an act of bankruptcy entails disabilities on the person who commits it": Ex parte Chinery [2] . We are no longer bound by the command in the Act of 1623 (21 Jac. I, c. 19, s. 1) that all earlier laws "made against bankrupts and for relief of creditors shall be in all things largely and beneficially construed and expounded for the aid, help and relief of the creditors of such person or persons as already be or hereafter shall become bankrupt". The question is now one of construction according to ordinary principles which does not exclude a consideration of the history of words and phrases long used in this branch of the law. 1. (1935) 36 S.R. (N.S.W.) 85, at p. 89. 2. (1884) 12 Q.B.D. 342, at p. 346. The first three paragraphs, (a), (b) and (c), of s. 52 describe three acts of bankruptcy which form a group. They are all acts that, done by an insolvent debtor, may delay or defeat the right of his creditors to have his assets ratably distributed. The first two, s. 52 (a) and s. 52 (b), are however much older than the third, s. 52 (c). In the English Bankruptcy Act, 1869, they, (a) and (b), appear (in s. 6) in words substantially identical with those in the Australian Act to-day, except of course that "Australia" has been substituted for "England". Before the Act of 1869 there had been no statutory assertion that a transaction as described in (a)—that is an assignment of all a debtor's property for the benefit of his creditors generally—was an act of bankruptcy. Nevertheless from the time of Lord Mansfield such an assignment had, by what Lopes L.J. later called "a somewhat forced inference", been treated as a "fraudulent grant or conveyance" (which meant a deed) in the Act 1 Jac. I, c. 15, s. 2. Changes made in 1825, by 6 Geo. IV, c. 16, did not alter this: Stewart v. Moody [1] . Therefore the words "conveyance and assignment" in s. 52 (a) still mean a deed effective to vest in the trustee all the property of whatever kind of the debtor: see In re Spackman [2] ; and In re Hughes; Ex parte Hughes [3] . The meaning of conveyance or assignment in par. (a) is thus referable to its own special history and to the form of instrument required to convey property of all descriptions. It does not in my opinion control the meaning of the phrase "conveyance or transfer" in par. (c). 1. (1835) 1 Cr. M. & R. 777 [149 E.R. 1294]. 2. (1890) 24 Q.B.D. 728. 3. [1893] 1 Q.B. 595. Passing to the next act of bankruptcy, that described in s. 52 (b) as "a fraudulent conveyance, gift, delivery, or transfer of his (the debtor's) property or any part thereof". These words appear in the English Act of 1869. They reproduce, with what has been held to be an immaterial variation, a provision in the Act of 1825, 6 Geo. IV, c. 16, s. 3, which was itself an extension of a provision in the Act 1 Jac. I, c. 15. The provision in the last-mentioned Act had referred only to "any fraudulent grant or conveyance of his (the debtor's) lands, tenements, goods or chattels". And Lord Mansfield had held that a "grant or conveyance" there meant a deed: Martin v. Pewtress [4] ; Rust v. Cooper [5] . This view was afterwards accepted in a number of cases: see Comyn's Digest title "Bankruptcy", 5th ed., vol. 2, p. 79. It was to overcome this by making the provision cover transactions that were not by deed that the words "gift, delivery or transfer" were in 1825 added to grant or conveyance. Thus s. 52 (b) also has a wording that is explained by its history. I do not think that, when thus explained, the presence in it of the words "gift" and "delivery" in addition to the words "conveyance" and "transfer", and the absence of any similar words in s. 52 (c), can be used to control the meaning of the latter paragraph, which defines a quite different act of bankruptcy. 1. (1769) 4 Burr. 2477 [98 E.R. 299]. 2. (1777) 2 Cowp. 629, at p. 633 [98 E.R. 1277, at p. 1279]. I pass therefore to s. 52 (c). It defines an act of bankruptcy that appeared first in the English Act of 1883, and is thus a comparative newcomer. It is important to notice that the provision for the avoidance of fraudulent preferences—from which s. 95 descends—had earlier come into the law in England, in the Act of 1869 (s. 92). Paying one creditor in preference to another is not, of itself, obnoxious to the statute 13 Eliz. c. 5. From the time of Lord Mansfield, however, fraudulent preferences, if made on the eve of a debtor's bankruptcy, were void against his creditors: Alderson v. Temple [1] ; Morgan v. Brundrett [2] . But giving to a creditor a fraudulent preference that would be void on bankruptcy was not, in itself, an act of bankruptcy unless it was an assignment by deed of the whole, or substantially the whole, of the debtor's property. That too was laid down by Lord Mansfield: Wilson v. Day [3] ; Alderson v. Temple [4] ; Hooper v. Smith [5] . What had to be shown in order to make a transaction void as a fraudulent preference depended upon a considerable body of case law. The Act of 1869 put the subject on a new basis: see Ex parte Griffity; In re Wilcoxon [6] . The question then arose whether, all preferences as defined by the Act having been made void by statute, the giving of such a preference was an act of bankruptcy. Mellish L.J. seems to have thought this was so: Ex parte Halliday; In re Liebert [7] . But not all judges took the same view. The Act of 1883 dealt with the question. To what extent and in what manner it resolved it is the very question in this case, for s. 52 (c) reproduces in terms s. 4 (c) of that Act. 1. (1768) 4 Burr. 2235 [98 E.R. 165]. 2. (1833) 5 B. & Ad. 289 [110 E.R. 798]. 3. (1759) 2 Burr. 827, at p. 830 [97 E.R. 583, at p. 585]. 4. (1768) 4 Burr. 2235 [98 E.R. 165]. 5. (1763) 1 Wm. Black 441 [ 96 E.R. 252]. 6. (1883) 23 Ch. D. 69. 7. (1873) L.R. 8 Ch. App. 283. The phrase "makes a conveyance or transfer" in s. 52 (c) differs only slightly from "makes a conveyance or assignment" in s. 52 (a). But—unlike s. 52 (a), which is by its history confined to the execution of a deed conveying the whole of a debtor's property and unlike s. 52 (b), which was expanded to ensure that it was not confined to deeds—it has no limitation of meaning fastened upon it by its past. It is not of itself descriptive of a transaction that is an act of bankruptcy. Rather it is indicative of any transaction that can properly be called a conveyance or transfer, which under some other statutory provision would amount to a preference void upon bankruptcy. The other statutory provision, which could be in a different Act altogether—for s. 52 (c) refers to "this or any other Act"—need not, it seems to me, describe the transaction that it avoids as a conveyance or transfer. If what it avoids could be aptly called a conveyance or transfer of property (as defined), then, however in fact described in the avoiding enactment, it would fit the description in s. 52 (c). That is how I see the matter. It is said, however, that s. 52 must be construed in the light of s. 95: they are now in the same Act: they use in part the same words. Section 95 is expressed in a form that, prima facie at all events, suggests that a payment made in favour of a creditor is something different from a conveyance or transfer of property in favour of a creditor. I do not overlook this. It is a significant circumstance to which Jenkins L.J. drew attention in Re a Debtor (No. 360 of 1951) [1] . But, although it may be that I underrate its effect, it seems to me far from decisive. There may be some transactions which would be payments that would not fall within the ordinary meaning of the expression "conveyance or transfer of any property", although, having regard to the wide definition of "property", I cannot be certain that there are. But, whether there are or are not, I do not think that the mention of payments necessarily means that without it payments would not be included. Words that strictly were superfluous have on occasions been introduced into statutes by way of precaution, lest some doubt be raised. Without the definition of "property", one would not ordinarily think that paying a debt in money would be called a transfer of property; and in 1869 the present definition of the word "property" was new. And the statutory provision making preferences void was also new. In the complicated body of judgemade doctrine concerning fraudulent preferences that it supplanted some cases had been about payments of debts, some about transfers of property to creditors not simply in payment of existing debts. Having regard to these decisions, it seems that it may well have seemed prudent to the draftsman of the new enactment to refer specifically to payments as well as generally to transfers. It would, no doubt, have been more artistic to have done so by some phrase showing that payments were to be considered as included in transfers of property; but a failure to do this does not mean that we must refuse to treat the reference to payments as precautionary surplusage. As Lord Macnaghten observed in Commissioners for Special Purposes of Income Tax v. Pemsel [2] , specific matters are not uncommonly mentioned in statutes although covered by a provision in general terms. Section 95 I take to be an illustration of what Sir Ernest Gowers, in the second edition of Fowler's Modern English Usage, has spoken of as "legal language where the multiplication of near-synonyms is a normal precaution against too narrow an interpretation". 1. [1952] 1 All E.R. 519. 2. [1891] A.C. 531, at p. 589. Whatever the reason for the presence of the reference to payments in s. 95, the absence of a similar reference in s. 52 (c) does not in my opinion exclude payments from the denotation of the word "transfer" in that paragraph. A main reason for my reaching this conclusion is the arbitrary consequences that the opposite construction would cause. The words "every payment made" cannot, I think, be restricted to payments in cash. If something other than cash be accepted as a discharge of a debt, a payment has I think been made for the purposes of bankruptcy law. Payments in this sense can be made by cheque, cheques being commonly accepted as conditional payments: payments are not infrequently made by postal notes, money orders, travellers' cheques, sometimes by postage stamps: payments of large sums are often made by handing over bearer bonds. And if a creditor accepts goods from his debtor in payment of his debt, a payment has been made. In Hooper v. Stephens [1] , hay was paid for by gin; in Saxty v. Wilkin [2] , part of the price of a horse was a pair of trousers. More closely in point are Wilkins v. Casey [3] , and Cannan v. Wood [4] , which arose under provisions that, like s. 96, protected certain payments. There being nothing in the Acts to restrict the word "payment" to money, it was held that it comprehended a delivery of goods by way of payment. To exclude from the operation of s. 52 (c) preferential payments of debts effected by transactions such as transfers by endorsement of bills of exchange, or by formal assignments in writing of debts would, it seems to me, greatly curtail the effective operation of s. 52 (c). If one transaction be excluded because it is a payment, all transactions that are payments must be excluded. The results in the administration of the bankruptcy law would be serious. Section 52 (c) defines an act of bankruptcy. For the reasons given in Halsbury , 3rd ed., vol. 2, p. 268, it is not an act of bankruptcy that is often relied upon to found a bankruptcy petition. But its occurrence may prove important for the doctrine of relation back under s. 90. The case of Re Docker; Ex parte Official Receiver [5] , which in my opinion was rightly decided, shows how important it can be. It seems to me that it is not in accordance with the policy of the bankruptcy law to give different effects to two kinds of transactions, both of them within s. 95 and neither clearly without s. 52 (c)—one of them transfers of property (whether money or other property) made by way of payment, the other transfers of property (whether money or other property) made in favour of a creditor but not by way of payment of an accrued debt. Lord Mansfield, speaking of this kind of question, once said that "commercial transactions should be determined on solid principles, not upon nice subtilties of law": Alderson v. Temple [1] . (The actual words are somewhat differently reported by Burrows [2] , or by his informant, a "most excellent notetaker", Burrows himself being at the time "confined with the gout"). It is of course a matter of opinion which construction of s. 52 (c) is solid and which subtlety. But, without traversing all the ground that my brother Taylor has in his judgment, which I had the advantage of reading, my conclusion accords with his. 1. (1835) 4 A. & E. 71 [111 E.R. 714]. 2. (1843) 11 M. & W. 622 [152 E.R. 954]. 3. (1798) 7 T.R. 711 [101 E.R. 1213]. 4. (1837) 2 M. & W. 465 [150 E.R. 840]. 5. (1938) 10 A.B.C. 198. 6. (1768) 1 Wm. Black 660, at p. 661 [ 96 E.R. 384, at p. 385]. 7. (1768) 4 Burr., at p. 2239 [98 E.R., at p. 167]. I would allow the appeal. Owen J. For the reasons given by Kitto J. I agree that the appeal should be dismissed.