Carson v Humphreys [1931] HCA 6

Carson v Humphreys [1931] HCA 6

Section 88 of the Bankruptcy Act 1924-1930, when properly construed, prohibits distress for rent only in respect of rent owing by the bankrupt, not for rent owing by a third party such as a sub-lessee. To construe the section otherwise would deprive a landlord not in privity with the bankrupt of his common law right to levy distress without providing compensatory rights in bankruptcy, which was not the intention of the Legislature.

Parties
Appellant: Wallace John Carson; Respondent: George Brian Humphreys
Jurisdiction
Australia
Procedural Posture
Appeal / On Appeal From the Court of Bankruptcy, District of New South Wales and the Territory for the Seat of Government
Outcome
Appeal allowed
Legal Topics
Distress for Rent, Landlord and Tenant, Rights of Sub Lessees, Priority of Debts in Bankruptcy
Bankruptcy Property Law Distress for Rent Landlord and Tenant Rights of Sub Lessees Priority of Debts in Bankruptcy

Case Brief

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Parties

Wallace John Carson

Appellant

George Brian Humphreys

Respondent

Procedural Posture

Appeal / On Appeal From the Court of Bankruptcy, District of New South Wales and the Territory for the Seat of Government

Legal Issues

  1. 1 Whether s. 88 of the Bankruptcy Act 1924-1930 precludes a head-lessor, not in privity with a sub-lessee debtor, from levying distress for rent against goods of the sub-lessee after a deed of arrangement.
  2. 2 Whether 'no distress for rent' in s. 88 extends to bar all distress, or only distress for rent owed by the bankrupt.

Ratio Decidendi

Section 88 of the Bankruptcy Act 1924-1930, when properly construed, prohibits distress for rent only in respect of rent owing by the bankrupt, not for rent owing by a third party such as a sub-lessee. To construe the section otherwise would deprive a landlord not in privity with the bankrupt of his common law right to levy distress without providing compensatory rights in bankruptcy, which was not the intention of the Legislature.

Court Disposition

Appeal allowed

Orders

  • Order of Judge Lukin discharged.
  • Application to the Court of Bankruptcy dismissed.