Nette v Howarth [1935] HCA 22

Nette v Howarth [1935] HCA 22

The lump sum payable to the bankrupt under section 38 of the Superannuation Act 1916-1930 (N.S.W.), being a refund of personal contributions, is not protected as 'pay', 'pension', 'salary' or 'wages' within section 101 of the Bankruptcy Act, and constitutes property in bankruptcy which vests in the official receiver for distribution among the bankrupt's creditors. The federal bankruptcy law prevails over any contrary provision in the State Act.

Parties
Official Receiver, Appellant: Perey William Nette; Bankrupt, Respondent: Walter Thomas Howarth
Jurisdiction
Australia
Procedural Posture
Appeal / High Court of Australia on Appeal From the Court of Bankruptcy
Outcome
Appeal allowed; previous order set aside
Legal Topics
Bankrupt Estate Vesting, State Superannuation Entitlements, Conflict Between Commonwealth and State Statutes, Definition of Property in Bankruptcy, Exempt Assets in Bankruptcy
Bankruptcy Superannuation Law Property Law Bankrupt Estate Vesting State Superannuation Entitlements Conflict Between Commonwealth and State Statutes Definition of Property in Bankruptcy Exempt Assets in Bankruptcy

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Parties

Perey William Nette

Official Receiver, Appellant

Walter Thomas Howarth

Bankrupt, Respondent

Procedural Posture

Appeal / High Court of Australia on Appeal From the Court of Bankruptcy

Legal Issues

  1. 1 Whether a lump sum payable to a bankrupt public servant under section 38 of the Superannuation Act 1916-1930 (N.S.W.) upon resignation is divisible among creditors as property in bankruptcy.
  2. 2 Whether the lump sum is protected by the State statutory exemption under section 88 of the Superannuation Act 1916-1930 (N.S.W.) or vests in the official receiver under the Bankruptcy Act 1924-1933.
  3. 3 Whether the lump sum is to be characterised as 'pay', 'pension', 'salary', 'wages', 'income' or as a capital receipt under section 101 of the Bankruptcy Act 1924-1933.

Ratio Decidendi

The lump sum payable to the bankrupt under section 38 of the Superannuation Act 1916-1930 (N.S.W.), being a refund of personal contributions, is not protected as 'pay', 'pension', 'salary' or 'wages' within section 101 of the Bankruptcy Act, and constitutes property in bankruptcy which vests in the official receiver for distribution among the bankrupt's creditors. The federal bankruptcy law prevails over any contrary provision in the State Act.

Court Disposition

Appeal allowed; previous order set aside

Orders

  • Declare that the lump sum payable under the Superannuation Act 1916 (N.S.W.) vests in the official receiver and is payable to him by the State Superannuation Board.
  • Remit the matter to the Federal Court of Bankruptcy to be dealt with according to law.