Re Noel Kenneth Dowell; Diana Scott Dowell and Stephen Graham Marks As Trustee of the Joint and Separate Estates of Noel Kenneth Dowell & Diana Scott Dowell v Noel Kenneth Dowell & Diana Scott Dowell [1987] FCA 35 (13 February 1987)

FEDERAL COURT OF AUSTRALIA

Re: NOEL KENNETH DOWELL; DIANA SCOTT DOWELL and STEPHEN GRAHAM MARKS as
Trustee of the joint and separate Estates of NOEL KENNETH DOWELL & DIANA SCOTT
DOWELL
And: NOEL KENNETH DOWELL & DIANA SCOTT DOWELL
No. 585 of 1985
Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA
BANKRUPTCY DISTRICT OF THE STATE OF VICTORIA
Evatt J.

CATCHWORDS

Bankruptcy - Whether bankrupts complied with direction of trustee - Whether certain items constitute "necessary household property" within the meaning of s.116(2)(b) of the Bankruptcy Act 1966 - Meaning of "ordinary tools of trade" within s.116(2)(c) of the said Act - Which aggregate amount applies due to the repeal of a Rule and the insertion of a new Rule - Meaning of "in the aggregate" within s.116(2)(c) - Whether Court in its discretion should allow the bankrupts to retain the tools of trade the value of which in the aggregate exceeded the prescribed amount or whether a creditors' meeting for determining that question should be ordered.

Bankruptcy Act 1966, ss. 30(5), 58, 116(2)(b) and (c), 265, 309(1)

Bankruptcy Rules, rr. 92, 202

Postal Services Act 1975, ss. 5, 36, 46(1) and 115

White v. Quartermain & Ors (Duggan J, Unreported, Victoria County Court, 24 June 1985)

Re Belcher (1932-34) 6 ABC 35

Willsmer v. Jacklin (1861) 5 LT 252

HEARING

SYDNEY
13:2:1987

Counsel for the Bankrupts: Miss Lewitan.

Solicitors for the Bankrupts: Mr M.J. Redfern, Balwyn, Victoria.

Counsel for the Trustee: Mr Braun.

Solicitors for the Trustee: G.D. Burnett & Co, Melbourne.

ORDER

The trustee call a further meeting of creditors within one month from the date of this order for the purpose of the creditors of the bankrupts determining:

(a) whether or not any of the household property of the

bankrupts set out in items 1-9 inclusive in the list of
assets dated 5 June 1986 and filed by the trustee on 6
June 1986; and

(b) whether or not ordinary tools of trade, plant and
equipment set out in items 10-17 inclusive in such list
and found by the Court to be such tools etc and to
exceed, in the aggregate, $1000 in value;

shall be included in the bankrupts' property divisible amongst their creditors.

Each party pay their own costs of the present application.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

DECISION

Sequestration orders against the joint and separate estates of the abovenamed, Noel Kenneth Dowell (the male bankrupt) and Diana Scott Dowell (the female bankrupt) were made pursuant to the Bankruptcy Act 1966 (the Act) on 26 August 1985. The act of bankruptcy was the failure by the male bankrupt and female bankrupt to pay on or before the 3rd and 2nd of January 1985 respectively a judgment debt made against them in the County Court of Melbourne on 19 October 1984.

2. The bankrupts are husband and wife and the parents of two children presently aged 13 and 11 years. The female bankrupt does not work whilst the male bankrupt has been employed at all relevant times by Australia Post at the Clayton Mail Exchange and also has carried on a small printing business under the firm name of Elite Printing for some eight years.

3. Stephen Graham Marks (the trustee), a registered trustee under the Act was appointed trustee of the estates of the bankrupts. At the date of the making of the said sequestration orders, the bankrupts lived at 967 Burwood Highway, Ferntree Gully, Victoria. In late October or early November 1985, the family moved to their present address, Avon Lodge, Seaview Avenue, Ferny Creek, a town some 40 kilometres out of Melbourne. The trustee apparently had not been advised by the bankrupts of their change of address before 15 November 1985, the date when a formal notice to the bankrupts to attend the first meeting of their creditors appointed for 9 December 1985 was forwarded to them at their Ferntree Gully address. This notice is discussed later herein.

4. On 27 September 1985 the trustee caused to be served on the bankrupts the formal sequestration orders in each estate together with the usual printed "Warning to Bankrupts". That document made references to statement of affairs, s.54; duties of bankrupts pursuant to ss. 77 and 265; requirements as to property, ss. 77, 78, 265; change of address, s.80; obtaining credit, s.269; leaving Australia, s.272; carrying on business, and to s.267 of the Victorian Companies Code, the final two paragraphs reading:

The above items are not the exact wording of the Bankruptcy
Act 1966 and you should refer to that Act for further
details.

You should sign and send the attached acknowledgement.

That acknowledgement reads,

I hereby acknowledge that I have received a copy of the
"Warning to Bankrupts - Some of Your Responsibilities" and
that I have read and understood its contents.

5. The male bankrupt signed and dated that acknowledgement on 16 October 1985 and forwarded it to the trustee.

6. Also at this time the trustee forwarded to the bankrupts a blank form headed list of household furniture and effects. That reads:

Your attention is drawn to Note 4 appearing on the Personal
Questionnaire which has been issued to you setting out a
description of "property".

You are required to complete the details of all furniture and
effects, ordinary tools of trade, plant and equipment,
professional instruments, reference books, but in doing so,
you may exclude items of wearing apparel, linen, ornaments,
curtains, a domestic sewing machine, and gardening tools.
Generally, all usual items of furniture and household
effects, including a washing machine and refrigerator, remain
in your ownership, but nevertheless, you are required to
include such items in the list on page 2 of this form.

7. Thereafter the form provided for (1) Tools of trade, plant and equipment etc and 2) description of furniture and effects. There were columns for purchase price and date of purchase. This form had been filled in by the male bankrupt and forwarded to the trustee on or about 16 October 1985.

8. It would appear that the return of the acknowledgement of the warning and the list of the bankrupts' property apparently crossed with a letter sent by the trustee to the bankrupts dated 14 October 1985 at their former home at Ferntree Gully. That letter reads:

I refer to the visit to your household on the 9th October,
1985 by Mr Phil Mitchell of my staff, whereupon he was
refused entry to your house on the grounds of not previously
advising you that he was going to visit and also on the
grounds that the house was untidy.

Following discussions with Mr Mitchell, I send the enclosed
direction and advise you that severe consequences will follow
if your Statement of Affairs does not accurately disclose all
your assets and liabilities.

I suggest that you scrutinise the warning to bankrupt
previously forwarded to you.

9. The enclosure to that letter which was a formal direction pursuant to s.265 of the Act to deliver up property to the trustee, reads:

I, Stephen Graham Marks of 60 Albert Road, South Melbourne,
the Trustee of the Bankrupt Estate of N.K. & D.S. Dowell,
hereby direct you to deliver up to me at my offices, within
14 days from the date of this direction, all property in your
possession or under your control which is divisible property
amongst your creditors.

Failure to comply with this direction will result in an
application being made to the Court for an Order that you be
committed to prison, or such other Order as is required.

Dated this 14th day of October, 1985.

10. The male bankrupt filed a statement of affairs on 17 October 1985, the affidavit verifying being sworn on 16 October 1985. This statement showed property assets totalling $2400 being printing machinery at the Ferntree Gully premises, value $800; household furniture and effects at that address, value $1100; and two motor vehicles, a 1962 Vanguard and a 1965 Wolseley, total value $500.

11. On 20 November 1985 the trustee wrote to the bankrupts advising that three statements of affairs were required to be filed, namely in the joint estate of N.K. and D.S. Dowell, the separate estate of N.K. Dowell and the separate estate of D.S. Dowell. That letter drew attention to s.265(1)(a), (b) and (c) of the Act. The joint and separate statement of affairs of the bankrupts were filed on 21 March 1986, the respective affidavits verifying being sworn on 6 March 1986. The female bankrupt's statement shows her separate property as NIL, the male bankrupt's statement shows his property as being the two items above for machinery and cars, the estimated value being the same whilst the joint statement shows the household furniture (at the same value) as the only property. The deficiencies shown are respectively: for the male bankrupt - $12,045; for the female bankrupt - NIL and the joint estate - $12,045.

12. On 25 November 1985 the male bankrupt advised the trustee by letter of the change of address from Ferntree Gully to Ferny Creek. That letter is stamped as having been received in the office of the trustee on 26 November 1985.

13. The said letter of 15 November 1985 from the trustee to the bankrupts advising of the first creditors meeting appointed for 9 December 1985 was not received by the bankrupts until 5 December 1985. As stated above the notice was originally forwarded to the Ferntree Gully address. Apparently on receipt of the change of address notice on 26 November 1985, the trustee's office caused a copy of the notice of the first meeting to be forwarded to the bankrupts at their Ferny Creek address. That notice and its envelope shows the Ferntree Gully address at the foot of the notice crossed out and the Ferny Creek address written in in ink, the envelope being franked 2 December 1985. The Court accepts that it was not received by the bankrupts until Thursday, 5 December 1985.

14. The bankrupt's did not attend that meeting, it being claimed that in order to do so it would have been necessary for the male bankrupt to have given notice of absence from work some time before he received the notice and also that it was considered that the female bankrupt should not attend on her own as her separate statement of affairs showed a nil return whilst the printing business run by the husband was, in reality, his business of which he alone knew particulars. This is dicussed later herein.

15. During the latter part of 1985 and the first quarter of 1986, apparent disagreement occurred between the trustee and the bankrupts as to whether the bankrupts possessed any property divisible among the creditors and particularly the failure by the bankrupts to grant access to the trustee to inspect the property as set out in the return made by the male bankrupt. Copies of correspondence exchanged between the trustee and the male bankrupt are annexed to affidavits filed but these in my view need not be set out in detail. Suffice to say that it was the bankrupts' contention that they had no assets or property which was divisible and that they had sought a meeting of creditors in order that some composition or arrangement could be entered into, they claiming that all creditors other than the judgment creditor who was the petitioner in the bankruptcy proceedings were happy with certain arrangements re paying off the respective amounts owing.

16. Consequently, by application dated 21 April 1986, filed on 30 April 1986, the trustee sought orders pursuant to s.30(5) of the Act that a warrant for the committal of the bankrupts to prison be issued by the Registrar as a result of their failure to comply with a direction by the trustee made pursuant to s.265 of the Act to deliver up to the trustee certain property in their custody and control.

17. That application was listed for directions before Sweeney J. on 3 June 1986 when His Honour ordered:

(1) that the trustee file and serve by Friday, 6 June 1986,
a list of property to be divisible in the bankruptcy of
each of the bankrupts. Such list to specify whether
each item of property is said to be the property of the
male bankrupt or female bankrupt or of each of them
jointly.

(2) that the bankrupts file any notice of intention to
oppose the application by 27 June 1986.

(3) directions were made as to the filing of affidavits by
the parties and giving reasonable opportunity to the
trustee to inspect and have a valuation prepared in
relation to the subject property.

18. Pursuant to those orders and directions, the trustee on 6 June 1986 filed a document dated 5 June 1985 being a list of assets as to which the trustee claimed entitlement as being divisible assets. That list showed 17 separate items, the last being "quantity of printing inks". Items numbered 1-9 inclusive were claimed by the trustee to be owned by the bankrupts, whilst items numbered 10-17 inclusive, were claimed by him to be owned by the male bankrupt. That list is set out later herein together with a valuation of each item estimated by Mason Greene and Associates, whose valuation was obtained by the trustee for the purpose of the present application.

19. By notice dated 18 July 1986 and filed on 24 July 1986, the bankrupts indicated their intention to oppose the application on the ground that the property specified in the said list of assets was not divisible property or alternatively that items 1-9 included "household property" which the bankrupts wished to retain pursuant to a resolution of creditors to be passed in accordance with s.116(2)(b) of the Act whilst items 10-17 inclusive, included "ordinary tools of trade etc", exceeding in the aggregate the prescribed amount which the male bankrupt wished to retain pursuant to either a resolution of creditors to be passed or by leave of the Court in accordance with paragraph (c) of s.116(2) of the Act.

20. Relevant parts of s.116 are:

116.(1) Subject to this Act -

(a) all property that belonged to, or was vested in,
a bankrupt at the commencement of the
bankruptcy, or has been acquired or is acquired
by him, or has devolved or devolves on him,
after the commencement of the bankrupts and
before his discharge; and

(b) ...

is property divisible amongst the creditors of the
bankrupt.

(2) Sub-section (1) does not extend to the following
property:

(a) ...

(b) necessary wearing apparel, necessary household
property of the bankrupt (including any sewing
machine used for domestic purposes) and such
other household property of the bankrupt, if
any, as the creditors by resolution determine;

(c) ordinary tools of trade, plant and equipment,
professional instruments and reference books of
the bankrupt not exceeding in the aggregate
$500, or such greater amount as is prescribed
for the purposes of this paragraph, in value,
and such other tools of trade, plant and
equipment, professional instruments and
reference books of the bankrupt, if any, as the
creditors by resolution determine or as the
Court, on the application of the bankrupt,
determines;

(d)-(o) ...

21. The said notice of intention to oppose raised a further issue, namely that as service of the first meeting of creditors called by the trustee had not been effected on the bankrupts in accordance with the Act and Rules both bankrupts were unable to attend with the consequence that they were deprived an opportunity to seek their creditors' permission pursuant to s.116(2)(b) and (c) of the Act to retain any divisible property. As an alternative the bankrupts sought the Court's direction that a further creditor's meeting be called in order that the bankrupts might be able to put their case to the creditors in this regard.

22. Pursuant to the 3 June directions, the male bankrupt filed an affidavit sworn 26 July 1986 on behalf of himself and his wife setting out particulars of his employment by Australia Post, generally on night shift, his earnings and the disbursement thereof. Further details were given as to what he believed was the valuation of the property referred to in the list of assets filed by the trustee together with particulars of a printing business which he claimed he had operated for some 8 years from his home under the business name of "Elite Printing". Affidavits in reply were file by the trustee sworn 26 August 1986 and 4 September 1986. The latter affidavit annexed the valuation by Mason Greene and Associates dated 25 August 1986 as mentioned earlier herein. That list and valuation are set out. The two headings, "G.C." and "A.R." stand for "Active Going Concern Basis" and "Auction Realization", respectively.

G.C. A.R.

1. Kriesler 3 in 1 Stereo System with
2 Twin Speakers $ 160 $ 110

2. Pye 22" Colour Television Receiver
Serial No. 110148 180 120

3. Sanyo Betacord Video Recorder Model
VTC.9300, Serial No. 01971211 160 110

4. Sanyo Automatic Washing Machine,
Serial No. 001595 120 80

5. Empisal Knitting Machine, Model KH680 35 15

6. Qty assorted LP Records, Audio and
Video Tapes 280 40

7. 1965 Wolseley Sedan Model 24/80, Reg.
No. CJB.464 (Engine dismantled)
Unregistered 100 NCV

8. 1962 Model Vanguard Sedan, Reg. No.
CJN.583 (Unregistered) 100 NCV

9. 1969 Model Holden Kingswood Station
Wagon (Now registered, not sighted) 500 350

10. Roneo Vickers Model RV2000 Offset
Duplicator 1400 850

11. Boston Monotype Pamphlet Stitcher,
Model No. 7 400 260

12. Ricoh SI Electric Plate Maker & Fuser 400 240

13. IBM Series 70 Golfball Typewriter,
Serial No. 23021186 210 160

14. Hand Guillotine 460 300

15. Steel 4 drawer Foolscap Filing Cabinet 90 70

16. Approx. 200' Handy Angle Shelving Frame,
incl. 5 bays Stockshelves 45 15

$4640 $2720

23. Item 17 shown in the list as filed by the trustee on 6 June 1986 - Quantity of Printing Ink, was omitted from this list.

24. The matter came on for hearing before the Court as presently constituted on 24 September 1986 when Mr Braun of counsel appeared for the trustee and Miss Lewitan of counsel appeared for the bankrupts. The matter did not finish in the estimated one day and the hearing resumed on 9 October 1986. On the morning of the first day, it was agreed between the parties that the issues before the Court were:

1) Whether there had been a failure by the bankrupts to comply
with a valid order or direction of the trustee;

2) Whether any of the property as listed in assets 1-9 inclusive
was necessary household property within the meaning of
s.116(2)(b) of the Act;

3) Whether the trustee should have, in the circumstances of this
case, called a further meeting of creditors in order to
obtain a decision by those creditors in accordance with
s.116(2)(b) of the Act that certain household property might
be retained by the bankrupts;

4) Whether certain of the property were ordinary tools of trade,
plant and equipment etc of the male bankrupt not exceeding in
the aggregate the prescribed amount within the meaning of
s.116(2)(c) of the Act;

5) Whether, assuming the value of such tools of trade exceed the
prescribed amount referred to in 4) above, the trustee
should have called a meeting of creditors as requested by the
bankrupts in order that the bankrupts could seek the
creditor's determination as to the retention of those tools
of trade in excess of the said amount in accordance with
s.116(2)(c).

6) Whether the notice of the creditors meeting held on 9
December 1985 was proper or suitable notice to the bankrupts
within the meaning of the Act and Rules.

7) Whether in all the circumstances, the Court should order a
further meeting of creditors to consider any necessary
application by the bankrupts under s.116(2)(b) and (c) of the
Act.

25. Issue 6) above can be dealt with conveniently at this point. It has been argued that a reading of s.309(1) of the Act with rr. 92 and 202 shows that "not less than 7 days" before 9 December 1985 had not been allowed for at the time of posting the notice of meeting out to the bankrupts on 2 December. The Court finds it unnecessary to make a definitive determination in this regard but points out that there is serious doubt whether the rules have been complied with, particularly if in making such a determination one is entitled to take into consideration the notorious delays in mail delivery at that time of the year.

26. The evidence shows that the family possess more than one of certain items of property, such as stereo systems or televisions. The trustee conceded that where there were two of a particular item (one working and one defective), which item was agreed as being necessary household property, then the item in working order was to remain with the bankrupts and the defective item should be handed over to the trustee. This concession led to some confusion, particularly with counsel for the bankrupts, she believing that counsel for the trustee had stated that he was not seeking some of the property set out in the list of assets as filed on 6 June 1986. The Court however is satisfied that any confusion in this regard has not resulted in any disadvantage to the bankrupts.

27. The Court was referred by counsel for the trustee to the decision of Duggan J. in the Victorian County Court in White v. Quartermain & Ors given on 24 June 1985 where His Honour considered the meaning of "necessary household effects" as used in s.116(2)(b) of the Act. At page 19 of the print of his reasons for judgment, Duggan J. said:

It seems to me that what is properly regarded as "necessary
household property" in a particular case must be decided by
reference to the household under consideration.

Further at page 21, His Honour said:

I take the view that it is intended that a household will not
be deprived of that property that is reasonably necessary for
its continuation as a viable household providing its normal
occupants with such facilities as will prevent impoverishment
or humiliation and will enable them to live in basic comfort.

I respectively agree with those observations of Duggan J.

28. Dealing then with the list as set out above, the Court makes the following determinations, subject to any determination by creditors under s.116(2)(b) of the Act giving their consent to any particular item stated herein to be liable to be handed over by the bankrupts to the trustee remaining in the possession of the bankrupts:

Item 1 - Stereo Unit. The formal list of household effects
supplied by the male bankrupt to the Trustee listed two stereo
units, one of which was inoperative. It is conceded by the
trustee that the bankrupts are entitled to retain the operative
stereo unit, the trustee being entitled to the inoperative unit.

Items 2 and 3 - Colour Television and Video Recorder. I am of
the view that the circumstances of this family are such that a
colour TV and a video recorder should be deemed to be necessary
household property. The family live in a somewhat remote area
and I accept that video tapes for educational purposes for the
children and enjoyment generally for the family should not be
deemed to be a luxury in this day and age especially in areas
where access to cinemas is not readily available. The list of
assets states that there is an inoperative black and white
television. The Court determines that the bankrupts should
retain the colour television and the video recorder.

Item 4 - Washing Machine. The list of assets shows two washing
machines, one a small machine which had been used by the family
when the larger machine broke down. If both machines are
presently in working order, the bankrupts may elect which one
they wish to retain. The Trustee is entitled to the smaller
machine.

Item 5 - Knitting Machine. It is noted that s.116(2)(b) of the
Act makes specific reference excluding a sewing machine. In my
view, in the circumstance of this case, the knitting machine
should be deemed to be necessary household property and should
remain with the bankrupts.

Item 6 - Tapes and Records. It having been determined by the
Court that the video recorder and the stereo should remain with
the bankrupts, it follows in my view that the bankrupts are
entitled to keep these items.

Items 7, 8 and 9 - Three Cars, one only registered. I accept
that the male bankrupt, working night shift, needs a car to get
to and from work as no public transport is then available. In
the circumstances of this family, one car only would be
necessary. The bankrupts are to retain the registered car. The
Trustee may take the other two.

Items 10-16 inclusive. These deal with ordinary tools of trade,
plant and equipment etc and fall within the description of assets
referred to in s.116(2)(c) of the Act.

29. I accept paragraph 6 of the male bankrupt's affidavit which reads:

THAT I have carried on the business of a part time printer
for approximately eight years and continue to carry it on.
the business name under which I operate is Elite Printing and
the last job I did was about five weeks ago for Taylor's
Brakes of Whitehorse Road, Mont Albert, and I presently have
another small job. Because of difficulties of my financial
position and my present uncertainty as to whether I will
continue to be able to use the printing equipment I have let
the business run down to only those orders made by regular
customers such as Taylor's Brakes for whom I have been doing
printing work for some six years. I would estimate that over
the last six months I have done about a dozen small jobs.
Should it be decided that the printing equipment is not
divisible property I would seek to restore the business and
would desire to seek to generate further income to enable me
to pursue the composition with creditors proposed by me and
referred to in Marks' affidavit.

30. The business of printing is clearly within the meaning of trade. In Re Belcher (1932-34) 6 ABC 35, Paine J. defined trade as the "business which a person has learned, ie, in which he has acquired technical ability and which he carries on for procuring subsistence or for profit: his occupation, particularly with mechanical implements, in contradistinction to either professional or agricultural industries."

31. Paragraph (c) of s.116(2) of the Act set out earlier herein limits the value of such property to in the aggregate $500, or such greater amount as is prescribed for the purposes of the paragraph. The words "or such greater amount as is prescribed for the purposes of this paragraph" were inserted by s.54 of Act No. 12/1980. By Statutory Rule No. 385/1980, r.39A was inserted into the Bankruptcy Rules. That Rule provided that the prescribed amount is $1000. By Rule 1. of Statutory Rule No. 96/1986 r.39A of the Bankruptcy Rules was repealed. Rule 2 of those Statutory Rules under the heading, "Prescribed amount for purposes of paragraph 116(2)(c) of the Act", inserted a new Statutory Rule 40B which reads:

For the purposes of paragraph 116(2)(c) of the Act the amount
of $2000 is prescribed.

New Statutory Rule 40B came into force on 15 May 1986.

32. It was argued by counsel for the bankrupts that because r.39A was repealed on 15 May 1986 and a new Rule 40B inserted making $2000 the amount prescribed, then, even though the application herein was filed on a date prior to 15 May 1986, namely 30 April 1986 the effect of such repeal was that thereafter the Court deems that r.39A never existed. Accordingly, so it was claimed, the proper prescribed amount to be considered on this application was that provided for by r.40B, namely $2000. As I understand her argument, she drew an analogy to the position where an amendment to an Act of Parliament repeals a particular section thereof (as opposed to merely amending it) and inserts a new section into the Act albeit dealing with the same subject matter. (See Craies on Statute Law, 7th Edition 412 - R. v. Mawgan (1939) 8 A & E 496 and R. v. Swan (1849) 4 Cox CC 108). But here it was not the Bankruptcy Act itself that was amended, the Rule merely states what is the prescribed amount at particular periods. I reject the above argument. The only doubt in my view is what is the date which governs the value of the tools of trade etc, in the aggregate. Is it the date when a determination is made by either the trustee, the creditors' meeting or the Court or is it the date of the sequestration order. Again, if it is the date of the determination by the Court, is it the date of the actual determination or the date of the filing of any application to the Court under s.116(2)(c). In my view, the wording of s.116(1) read in conjunction with s.58, makes the relevant date for determining what is the value of the tools of trade, in the aggregate, is the date of the sequestration order. It is not necessary in this particular case to consider any after acquired property. Accordingly the Court is of the view that the prescribed amount governing paragraph (c) of s.116(2) in this particular application is $1000.

33. The total amount of the tools of trade set out in the above list exceeds $1000 whether one is considering the going concern value or the auction realization value as set out in Mason Greene & Associates valuation. Further, the affidavit of the male bankrupt sets out values that he himself places upon certain assets making up the tools of trade which total, in the aggregate, in excess of $1000.

34. A question arises as to the meaning of "in the aggregate" as used in paragraph (c) of s.116(2). Surely it cannot mean that if a bankrupt has tools of trade which total $999 he is entitled to retain those tools without question, whereas if the value of such tools is properly assessed at $1001, in the aggregate, he is not then entitled to keep any of those tools. In the latter case, the contrary argument raises a question who decides which tools are to remain with him and which are to be handed over to the trustee (see Willsmer v. Jacklin (1861) 5 LT 252 - Blackburn J).

35. These are problems of course which do not necessarily concern the Court here. The bankrupts seek a determination by the Court that they be entitled to retain all the tools of trade set out in the above list, even though the total value of these tools exceed $1000. On Mason Greene and Associates valuation those tools have an auction realisation value of $2245 and a going concern value of $4505. I am of the view that it would be unrealistic to find that any sale of these particular tools would realise an amount greater than the stated auction realization value and the Court makes a determination that the value of each of those items is that shown in the A.R. column of Mason Greene & Associates valuation.

36. A further matter requires consideration. Towards the end of the first day's hearing, the Court raised with counsel the question whether the male bankrupt could, within the terms of his contract of service with Australia Post, carry on the trade of printing that he claimed he had been doing for some eight years. The Court had the clear impression at that time that neither side had considered this aspect.

37. When the hearing resumed on 9 October 1986, counsel for the bankrupts tendered an affidavit of William Robert Hearn sworn 8 October 1986 and sought leave to call as a witness a Mr Godbold. Counsel for the trustee objected to the tender of the affidavit on the basis that the deponent was not available for cross-examination despite a request that he be present for that purpose. The Court was informed that Mr Hearn was out of Melbourne attending a weeks conference in connection with his employment. In the circumstances, the Court allowed the tender of Mr Hearn's affidavit. Mr Godbold gave oral evidence and was cross-examined. He is a senior consultant with Australia Post stationed at its headquarters at Carlton. The Postal Services Act of 1975 sets up a Commission called the Australian Postal Commission (s.5). Section 36 of that Act makes provision for the Commission to delegate to certain nominated officers any power which the Commission has under the Act other than the power of delegation. Such delegation is to be by instrument under seal. Further, s.115 of that Act gives to the Commission the power to make By-laws not inconsistent with the Act. Paragraph 1(q) of s.115 reads:

115.(1) The Commission may make By-laws, not inconsistent
with this Act or the regulations, prescribing all matters
which are required or permitted to be prescribed by the
By-laws, and, making provision for or with respect to -

...

(q) the terms and conditions of employment of officers and
employees.

Section 46(1) of the Act provides:

Subject to this Part, officers and employees hold office on
such respective terms and conditions as the Commission
determines.

38. Mr Godbold produced a copy of the Postal (Staff) By-law 21. That By-law deals with "outside employment". Paragraph 21(1) provides that an officer shall not, without the express permission of the Commission, engage in employment outside the Service or engage or continue in private practice, occupation or trade. The By-law then makes provision for application for permission to engage in employment outside the Service under certain conditions, including that written permission be obtained from the Commission.

39. It was the male bankrupt's case that he had been granted permission to work at the trade of a printer. That permission was granted by Mr Hearn on 3 October 1986, he being the officer with the necessary delegated power of the Commission in this regard pursuant to s.36 of the Postal Services Act. A copy of the particular delegation, under seal, was produced by Mr Godbold and accepted as an exhibit herein.

40. The Court is satisfied that proper permission has been granted to the male bankrupt to carry on his trade as a printer. It is appreciated of course that that permission has been granted since the institution of the present application and indeed subsequent to the first day's hearing of that application. Nevertheless, the male bankrupt presently has that permission and it is not suggested that such permission is likely to be withdrawn in the future.

41. The male bankrupt has asked the Court that in all the circumstances, it direct a further meeting of creditors be held so that the bankrupts might attend and put to them particulars of a certain composition referred to in his affidavit and further, to the extent that any of the items of the property are divisible property, to seek the approval of the creditors to retain the same. Alternatively, the male bankrupt sought the approval of the Court to retain such divisible property.

42. After consideration the Court was at first minded to make an order pursuant to s.116(2)(c) that all the tools of trade etc set out in items 10-17 inclusive remain with the male bankrupt. But on further reflection the Court has come to the firm view that the totality of the evidence is such that the Court should not, in its discretion, make such an order. It is considered that such a determination should at this stage be that of the creditors.

43. The Court is of the view that s.30(1)(b) gives it the power to direct the trustee to call a further creditors' meeting in order that those creditors might consider these matters. The male bankrupt should be given an opportunity of presenting to the creditors his case for the retention of any divisible property making up the tools of trade set out in items 10-17 inclusive in the list of property filed by the trustee on 6 June 1986. The Court has already determined the value of each of those items as being the value set out in the "A.R." column in the valuation of Mason Greene & Associates set out earlier herein. It may well be that the creditors at this meeting could consider whether it would be worth the trouble and expense for the trustee to collect and dispose of the inoperative stereo unit, the black and white television, a washing machine and the two cars - items 7 and 8.

44. As to costs of the present application, the Court, in the exercise of its discretion, determines that in all the circumstances each party should bear their own costs.