Paul Lee v. The Official Receiver of Paul Lee Engineering Co Ltd

CACV000020/1978

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Coram: Huggins, J.A., McMullin and Cons, JJ.

Date of Judgment: 1 June 1979

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JUDGMENT

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Huggins, J.A.:

1. This Appellant was, on 15th December 1975, convicted by a judge of the District Court on two charges of conspiracy and was thereupon sentenced to two and a half years' imprisonment. He was also ordered to pay a sum of "$151,500 compensation to the Official Receiver of the Paul Lee Engineering Co. Ltd.". It is also material that in other criminal proceedings the Appellant was convicted and sentenced to a concurrent term of four years' imprisonment. This resulted in his being in custody until September 1978. As a result of the order for compensation a bankruptcy notice was served upon the Appellant. The Appellant sought to set aside that notice on the ground that the company owed him a substantially larger sum of money. This matter came before a judge in chambers on 21st February 1978. Prior to that date the Appellant had sworn and filed an affidavit (which we are told was in fact dated 3rd February 1978) in which the Appellant indicated that he sought an adjournment on the ground that he had not been able to obtain necessary documents to prove a cross-claim or set-off. That document was on the court file but it appears not to have been served upon the Official Receiver and not to have been referred to at the hearing on 21st February. That is confirmed by the Official Receiver, who says that he has never seen the affidavit until today, and by the order made by the judge, which refers to another affirmation but not to this one. In my judgment that prima facie shows that the Appellant did not receive a fair hearing of the matters which he sought to put before the judge.

2. It has been argued before us that the cross-claim or set-off which the Appellant seeks to put up is in fact something which he is not allowed to set up against this particular order for compensation. We have been referred to two cases, but, for my part, I am not persuaded that the claim which the Appellant seeks to put up is not one which comes clearly within the Bankruptcy Rules and which he is entitled to put forward as a cross-claim or set-off, and since he has been, in my judgment, prejudiced by the failure to consider the application for an adjournment fully, and, since I think it is an application which the judge probably would have granted had the matter been fully argued before him, I would allow this appeal on this point alone and direct that it go back to the judge for the matter to be heard further.

Cons, J.:

3. We have dealt only with the question of whether an adjournment of the original application should have been granted. In this respect the Official Receiver has raised an argument which, if it be correct, would render nugatory any further hearing of that application. Through no fault of his own he has been unable today to develop that argument as fully as he would have wished and I would only say that on such authority as he has in fact been able to show us I am not satisfied that his argument is correct. I would therefore agree, for the reason already given, that the matter should be remitted to the trial judge.

1st June 1979.