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Fera v Morris [2003] SBHC 19; HC-CC 177 of 2000 (15 May 2003)

HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 177 of 2000

REX FERA (An adjudged Bankrupt)

-v-

WAYNE FREDERICK MORRIS AND BENJAMIN ST. GILES PRINCE
(Trustees of the Estate of Rex Fera)

Before: Kabui, J.

Date of Hearing: 9^th May 2003
Date of Ruling: 15^th May 2003

Mr B. Upwe for the Applicant
Mr J. Sullivan for the Respondents

RULING

(Kabui, J): This is an application by Rex Fera an adjudged bankrupt filed on 2^nd April 2003 for the following orders –

1. That leave be granted to commence proceedings against the Trustees of the Estate for the reasons that -

(a) the action of the trustees in paying money to the creditors after relying on the evidence contained in the transcript, which was not signed by Rex Fera, is contrary to section 19(8) of the Bankruptcy Act.

2. That an Order to stay further administration by the Trustees of the Estate of Rex Fera until the Court decides on the matter as sought in paragraph 1(a) above.

3. That cost be in the cause.

This application is similar in kind to an application brought in this Court in February this year upon which I ruled on 19^th February 2003. Section 19(8) of the Bankruptcy Act was also cited in support of that application as well. I rejected that application with costs. On page 3 of that ruling, I emphasized the fact that Rex Fera had not produced any hard evidence of his allegation that he had not signed the transcript of the public examination proceedings conducted into his affairs. This present application appears to be a vindication of that fact and so the Court is being asked to say something about the issue. He has now produced a voluminous copy of the unsigned transcript. In this regard, section 19 (8) of the Act states –

“...8. The debtor shall be examined upon oath and it shall be his duty to answer all such questions as the court may put or allow to be put to him.

Such notes of the examination as the court thinks proper shall be taken down either in shorthand or longhand and they or a transcript thereof shall be read over either to or by the debtor and signed by him and may thereafter, save as in this Act provided, be used in evidence against him; they shall also be open to the inspection of any creditor at all reasonable times upon payment of the prescribed fee..."

The applicant therefore feels he has scored a point against the Trustees in this regard. Mr. Sullivan did concede this point at the hearing of this application. Mr. Upwe's argument was that because Mr. Fera had not signed the transcript of his evidence his evidence should not have been used against him by the Trustees. I think what Mr. Upwe meant was that because of that omission, the evidence given by the applicant would have been inadmissible against the applicant. If that argument succeeds, the consequence would be disastrous for the Trustees. It is therefore important to examine the language of section 19 (8) of the Act closely to see what is the intention of Parliament couched in that provision. Clearly, if the transcript of the evidence had been read over to the applicant and signed by him it would be evidence by him authenticated by his own signature. That evidence may be used against him in other proceedings whether they are civil or criminal in nature. This is the difference between the literal meaning of the language used in section 19 (8) of the Act and the intention of Parliament. The intention of Parliament is to allow the signed transcript of evidence already given by the bankrupt at his public examination to be used against him at another hearing arising from his conduct in the course of the administration of his estate. This is a useful and convenient way of saving the cost of calling the bankrupt to repeat his evidence at another hearing if his evidence given at his public examination should prove to be relevant. The word to underline in section 19 (8) of the Act is "thereafter"; suggesting that the signed transcript of evidence may be used later against the adjudged bankrupt if the need arises. This need does underpin the nature of the public examination of the adjudged bankrupt, which allows very extensive and searching enquiry into the affairs of the adjudged bankrupt. The case in point was In re A Solicitor (1890 25 Q.B.D.17 where it was argued that evidence given by a bankrupt solicitor during his public examination and signed by him was inadmissible in a proceeding for professional misconduct before the committee of the Law Society. That argument was rejected by Lord Coleridge, CJ. At page 25, His Lordship said –

"...Therefore, it is plain that a bankrupt is bound to answer questions which the Court allows to be put, and that the answers, although they tend to criminate him, may, by express words of the Act of Parliament, afterwards be read in evidence against him..."

The point raised by the applicant is slightly different in nature in that he is disputing his own evidence given at his public examination being used against himself because he had not confirmed it and signed it in terms of section 19 (8) cited above. I think this point is not the defect for which section 19 (8) of the Act was enacted to remedy. It is a point that is irrelevant to advance as a basis for this application. The reason is that the applicant gave his evidence on oath during his public examination and his evidence had been recorded. His evidence can be acted upon by the Trustees like the courts do with evidence given on oath in any ordinary civil or criminal trial conducted by a court of law. The omission alleged by the applicant in this case is not fatal to the findings of the Trustees based on his evidence though unconfirmed and unsigned regarding the affairs of the applicant as an adjudged bankrupt. There is no other proceeding against the applicant in which the transcript of his evidence is relevant for admission against him in that proceeding. It does not make sense to argue that evidence already given on oath cannot be used against the adjudged bankrupt simply because he has not confirmed and signed it. The wording of section 19 (8) of the Act is a direct uplift from section 15 (8) of the Bankruptcy Act, 1914 of the United Kingdom. The commentary on section 15 cited above at pages 90-91 in Williams on Bankruptcy, 17^th Edition, 1958, by Mui.r Hunter does support my conclusion. This application has been misconceived and therefore must fail. Leave is refused. The application is therefore dismissed with costs.

F.O. Kabul

Judge