Re Frank Joseph Mercovich and Terence Harold Griffiths Ex Parte: Vanguard Service Print [1985] FCA 99 (29 March 1985)

FEDERAL COURT OF AUSTRALIA

Re: FRANK JOSEPH MERCOVICH and TERENCE HAROLD GRIFFITHS
Ex Parte: VANGUARD SERVICE PRINT
No. 51 of 1980
Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA
BANKRUPTCY DISTRICT OF THE STATE OF WESTERN AUSTRALIA
Toohey J.

CATCHWORDS

Bankruptcy - discharge by operation of sub-s.149(7) of the Bankruptcy Act - application by creditor for extensions of time to file an application under sub-ss.149(8) and 149(12) of the Act and of the date for expiry of an objection lodged by the Official Receiver - whether the day being the "date of bankruptcy" included in calculating 5 year period under sub-s.149(7) - application of sub-s.36(1) of Acts Interpretation Act

Words and Phrases - "5 years from the date of bankruptcy

Bankruptcy Act 1966 sub-s.149(1),(3),(7),(8) and (12)

Acts Interpretation Act 1901 sub-s.36(1)

HEARING

PERTH
29:3:1985

ORDER

1. In calculating the period of 5 years from the date of bankruptcy of the respondents, the time is to be reckoned exclusive of 12 February 1980 and it is further declared that the period of 5 years did not lapse until midnight on 12 February 1985.

DECISION

To appreciate the issues presently before the Court it is necessary to make some reference to the history of this matter.

On 12 February 1980 in the Supreme Court of Western Australia a sequestration order was made against Frank Joseph Mercovich and Terence Harold Griffiths. The order was made on the petition of Vanguard Service Print which is the applicant in applications now before the Court. In the ordinary course sub-s.149(1) of the Bankruptcy Act 1966 would have effected a discharge of the bankruptcies at the end of 3 years. However on 18 January 1983 the Official Receiver, in exercise of his power under sub-s.149(3), entered an objection to the discharge of each bankrupt. In the case of Mr. Mercovich the objection, made pursuant to para. 149(4)(a), was that the bankrupt was able, or likely within 5 years from the date of bankruptcy to be able, to make a significant contribution to his estate. In the case of Mr. Griffiths the objection, made pursuant to para. 149(4)(c), was that the bankrupt had failed to co-operate in the administration of his estate. Those objections had the effect of precluding a discharge from bankruptcy by virtue of sub-s.149(1).

However by reason of sub-s.149(7), an objection entered under para. (3)(c) lapses at the expiration of 5 years from the date of the bankruptcy or, if the Court makes an order under sub-s.(8) or (9), the period fixed by the order. Sub-section (8) empowers the Court, at any time before the expiration of 5 years from the date of bankruptcy, on the application of the persons therein specified including a creditor, to order that the period at the expiration of which an objection entered under para. 149(3)(c) will lapse by such period exceeding 5 years, commencing on the date of the bankruptcy, as is specified in the order.

The applicant seeks to do two things. It seeks an extension of time for the filing of an application pursuant to sub-s.149(8), alternatively pursuant to sub-s.149(12). The latter sub-section empowers the Court at any time before discharge, to direct that the bankrupt shall not be discharged from bankruptcy by virtue of s.149.

There is a further application by the applicant in which it seeks an order that the time at the expiration of which the objections lodged by the Official Receiver on 18 January 1983 will lapse will be 12 February 1987. Alternatively the applicant seeks an order that the bankrupts be not discharged from bankruptcy by virtue of s.149 and that it have leave to enter an objection pursuant to para. 149(3)(c) of the Act.

On 12 February 1985 an order was made by the Supreme Court of Western Australia in these terms:

"The time at the expiration of which the objections dated 18 January 1983 and filed herein will lapse will be 30 March 1985, or until further order".

It should be noted that on 11 February 1985 in the Supreme Court an order was made in the following terms:

"The time for filing an application pursuant to Section 149(8) and alternatively Section 149(12) and or Section 149(3)(c) be extended to the date of the first sittings of this Court in March 1985".

Since the Federal Court began to exercise jurisdiction in bankruptcy in March, there may be no such event as the first sittings of the Supreme Court in that month. Presumably conscious of the difficulties associated with the earlier order, the applicant sought the order of 12 February to which reference has been made. The applicant placed no reliance upon the order of 11 February at the hearing before the Federal Court.

One of the bankrupts, Mr. Mercovich, addressed an argument to the Court which if valid has the consequence that when the order of the Supreme Court was made on 12 February 1985 the bankrupts were already discharged from their bankruptcy by the operation of s.149. The argument ran this way. By reason of sub-s.149(7), an objection entered under para. (3)(c) lapses at the expiration of 5 years from the date of bankruptcy unless before that time an order has been made under sub-ss.(8) or (9). The date of bankruptcy was 12 February 1980 hence, it was said, the 5 years expired at midnight on 11 February 1985. Thus when the Supreme Court made its order on 12 February the bankrupts were already discharged.

In answer to this argument the applicant relied upon sub-s.36(1) of the Acts Interpretation Act 1901 which reads:

"Where in an Act any period of time, dating from a given day, act, or event, is prescribed or allowed for any purpose, the time shall, unless the contrary intention appears, be reckoned exclusive of such day or of the day of such act or event".

Unless there is a contrary intention expressed in the Bankruptcy Act, it follows that in calculating the period of 5 years from the date of bankruptcy mentioned in para. 149(7)(a) the time is to be reckoned exclusive of 12 February 1980. In that event the period of 5 years did not elapse until midnight on 12 February 1985 by which time an order of extension had been made. As no contrary intention appears in the Act, Mr. Mercovich's argument must fail.

The situation then is that, by reason of the order of the Supreme Court made on 12 February 1985, the objections lodged by the Official Receiver will not lapse until 30 March 1985. I shall now hear from the parties on the substantive matter viz. the orders sought by the applicant that the time at the expiration of which the objections will lapse be 12 February 1987, alternatively that the bankrupts be not discharged by virtue of s.149 and in any event that the applicant have leave to enter an objection pursuant to para. 149(3)(c).