RE ROBERT COOPER.

Poverty Bay Standard, Volume X, Issue 1139, 5 September 1882, Page 2

RE ROBERT COOPER.

(From the N. Z. Times.} The following appeal case was heard in Wellington on the 30th August, in Banco, before His Honor the Chief Justice. Judgment has not yet been given:—The appeal was against the deci s : on of the District Court of Hawke’s Bay, holden at Gisborne, presided over by Mr Hardcastle, sitting in bauKruptcy iurisdictiou. Mr Edwards for the appellant; Mr Alfred Whitaker for the respondent. Mr Whitaker ra’sed a preliminary objection under Rule 13 of the rules made under the Debtors and Creditors Act, 1876, that no notice had baen given till the 31st July, the appeal having been heard on the 19th July, the rule requiring a notice within three days. The fact that the cage is signed by the parties is no waiver of the defect; the facts are before the Court in the case for the purpose of raising the objection. Under section 17 of the Act, the appellant could have applied to have the time extended. His Honor : But the rule seems inconsistent with the provisions of the Act. Mr Edwards contended that the irregularity was waived by the respondent’s solicitor having signed the case, and that the facta in the case do not appear to have been inserted for the purpose. The rule is clearly ultra vires. The Act intended to allow 21 days for giving notice of appeal and security, and the rule limits it to three days. The rules are made under section 19, but it was not competent to alter the time as a 1 lowed by the Act. His Honor : You may continue, Mr Edwards. I will consider the matter, but I am inclined to think that the rule is ultra vires. Mr Edwards then proceeded to argue the appeal. The facts were shortly as follow: —One Malcohn Macdonald had recovered a judgment against R. Cooper for £546 ; a Fi. Fa. issued thereunder had been returned nulla lona, and he then sold his debt to W. Coleman and J. F. Clarke, the trustees in the estate of G. E. Read, deceased, who, on the 2/th May, 1882, petitioned thereupon to the District Court at Gisborne to adjudicate 1 Cooper a bankrupt. A summons was issued, signed by G. L. Greenwood, the Clerk of the Court, calling on Cooper to appear ‘ ‘ at the office of the Clerk of the District Court,” to show why he should not be adjudicated a bankrupt. The Clerk heard evidence, and on 6th July (sitting as the Registrar under section 12) dismissed the petition on its merits, on <he grcundsjthat the proceeding was a fraud in the bankruptcy laws, and was taken pc leiy for the purpose of impeding litigat on pending between Cooper aud Read’s trustees. On the Bth July a summons wa n taken out calling on the appellants to show cause why the order of the Clerk should not be discharged or varied. On the 19th July the Judge (Mr Hardcastle) discharged the order of the Clerk of the Court, and adjudicated Cooper a bankrupt, and against this decision Cooper now appealed on the grounds—(l.) That the proceedings were a fraud in the Bankruptcy Laws. (2.) That the debt was purchased in order to stifle an action being prosecuted by the debtor. (3.) That the summons on which the adjudication proceeded was not sufficient to give jurisdiction. (4.) That the Clerk of the District Court had disposed of the matter on its merits. (5.) That the order had not been properly drawn up. (6.) That the Debtors and Creditors Act had not been complied with, aud generally that the proceedings were irregular. Mr Edwards waived the fifth point, and on the remainder contended that there was no jurisdiction in the District Court, because there was no proper summons. It was defective in that it was a summons of the Clerk, who had no power, and not of the Court; and it did not call on him to appear before tho Court, but at the office of the Clerk of the Court. The Judge of the District Court had no power to rescind or vary the order made by the Clerk. It is the order of the Court, or it is no order at all. Sec Jon 14 of the Act refers only to the proceedings referred to in Section 13, The reference to the Section in Reg. v. Henderson, 4 N. Z. Jur., 110, was a dictum of His Honor Mr Justice Johnston, unnecessary for the decision in tliat case. This was not a bona fide application. It was merely for the purpose of quashing the litigation pending between Cooper and Read’s Trustees. If the petition was made other than for the purpose of getting the estate divided among creditors, it was not bona fide. The debt was not that of the petitioning creditors ; it was bought for the purpose of taking proceedings in bankruptcy. It is the third application made by the same parties to adjudicate Cooper bankrupt. The unsecured creditors evidently do not join in the proceedings. If the petition was made for the purpose of quashing the pending litigation it will not be allowed to stand. Mr Whitaker contended that no objection could be taken to the summons ; any defects hod been waived by Cooper proceeding with the appeal. The Clerk had jurisdiction under the 11th and 12th Sections of the Act. Reg. v. Henderson {.tupra}. Therein nothing to show that the debt was purchased for the purpose of taking bankruptcy proceedings to

stifle an action, and, even if it were so, the respondents had a right to do it. But the bankruptcy would not stifle the action.

Mr Edwards having replied, His Honor took time to consider his decision.