BA s60 and administrative rulings

The ability of a bankrupt to use s60(4) of the Bankruptcy Act 1966 (Cth) to continue with a challenge to an administrative determination was recently considered in Fisher v Transport for NSW.

Mr Fisher operated a business as a bus driver conducting commercial tours in NSW together with his wife. He was served with a show cause notice from the Department under the Passenger Transport Act 1990 (NSW) but he failed to respond so the Department cancelled his authority to operate his transport business. Mr Fisher then began a prolonged series of appeals and applications for review through the Department and subsequently through the NCAT. Mr Fisher subsequently became bankrupt while his application for judicial review of the decision to cancel his authority.

The Department wrote to Mr Fisher’s bankruptcy trustee requesting an election under BAs60(2) and the trustee indicated they did not intend to continue with the proceedings, but did not file a notice to discontinue. Mr Fisher wished to continue with the proceedings in his own name.

There were 2 issues for determination:

  1. Was the application for judicial review an action to which s60(2) applied?
  2. If so, then was the action a ‘personal injury or wrong done to the bankrupt’ under s60(4)?

Justice McCallum reviewed the decisions concerning the scope of the term ‘action’ for the purposes of s60 and held that an application for judicial review was an action caught by the provision.

Her Honour then moved on to the second ‘interesting’ question which she answered in the affirmative. Her Honour considered the leading authorities on s60(4), including Cox v Journeaux (No 2) (1935) 52 CLR 71, which held that an action for damages ‘by reference to pain felt by the bankrupt in respect of his mind, body or character and without reference to his rights of property’ would come within the predecessor provision to the current s60 (Bankruptcy Act 1924 (Cth) s63(3)).

In this case McCallum J held that the finding of the Department that Mr Fisher was not a ‘fit and proper’ person was concerned with his character and without reference to his property rights and therefore it was open to the bankrupt to continue the proceedings in his own name. Her Honour stated (at [36]):

The broad interpretation of the statute explained in the authorities …necessarily comprehends the proposition that the notion of “personal injury or wrong” might include an adverse administrative decision.

Her Honour then stated (at [37]):

If this was an action for damages for defamation arising from the publication of the imputation that Mr Fisher is not a fit and proper person to engage in his chosen occupation of a bus driver, the decision in Moss v Eaglestone [2011] NSWCA 404 would hold that the action fell within the exception in s 60(4). Mr Fisher would of course be unable to sue on that cause of action in the present case because the impugned decisions are plainly protected by absolute privilege; my point is a different one. It seems to me that, for coherence, the law should similarly regard an action seeking to impugn an administrative finding that Mr Fisher is not a fit and proper person to engage in the occupation of a bus driver to be an action “in respect of” a personal injury or wrong.

The Fisher case provides a useful and concise analysis of the scope of s60 of the Bankruptcy Act and confirms that challenges to administrative decisions based on the character of the bankrupt can be continued by the bankrupt in their own name.

 

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