Case: Griffiths v Civil Aviation Authority (1996) 67 FCR 301
Outcome: applied
The applicant relied upon Cummings [1996] HCA 19 ; 185 CLR 124 and Griffiths v Civil Aviation Authority (1996) 67 FCR 301 , being a decision of the Full Court of this Court in which the Court held that a proceeding in the Federal Court pursuant to s 44 of the Administrative Appeals Tribunal Act to challenge a decision of the Administrative Appeals Tribunal was not property divisible among the creditors of the appellant's estate vesting in the trustee of that estate. 77 The holding that an application of this kind is not property of the bankrupt which vests in the trustee is consistent with the decision of the Full Court of this Court in Griffiths v Civil Aviation Authority 67 FCR 301 where the Full Court held that an appeal to the Federal Court on a question of law from the decision of the Administrative Appeals Tribunal in relation to conditions imposed upon a bankrupt on aviation licences was not property of the bankrupt which vested in the trustee. Cooper J said in that case at 325-326: There is a unity of object and purpose in the operation of ss 58, 60 and 116 of the Act if it is recognised that the consistent focus of attention is upon rights which the trustee can turn to advantage for the benefit of creditors or upon rights the exercise of which will adversely affect or delay the administration of the estate. It is these rights which fall within the definition of "property" in s 5 and the enforcement of which by action are stayed by s 60(2) upon a person becoming bankrupt. To interpret "property" for the purposes of s 5 in this way avoids the injustice of denying to the bankrupt the power to exercise a right in which the trustee has no interest and the exercise of which cannot operate adversely on the property of the bankrupt or the administration of the bankrupt's estate. The right of Mr Griffiths to appeal to this Court from the decision of the Tribunal and his right to appeal from the judgment of Kiefel J are such rights and did not vest in the Official Trustee upon acquisition by Mr Griffiths. Neither Mr Griffiths' appeal from the Tribunal to the original jurisdiction of this Court, nor his appeal from the order of Kiefel J to the Full Court is incompetent in consequence of his bankruptcy. 78 The right to sue for the bankrupt's earnings, wages or income does not vest in the trustee and therefore the right is exercisable by the applicant. 79 I also agree, with respect, with the decision of the Full Bench of the New South Wales Industrial Relations Commission in Perfection Dairies Pty Ltd v Finn [2006] NSW IR Comm 137. In that case, the appellant before the Commission had summarily dismissed the respondent from employment for wilful misconduct. A Commissioner had ordered the respondent be reinstated and that the appellant pay the respondent an amount which equated to the remuneration he would have received but for the dismissal. One of the issues raised on that appeal was whether the respondent, as an undischarged bankrupt, had standing to bring the application for reinstatement. The Commission, after referring to the sections of the Bankruptcy Act to which reference has been made in these reasons and after referring to the dicta of Cooper J in Griffiths v Civil Aviation Authority 67 FCR 301 , to which I have also made reference, and the judgment of the Queensland Court of Appeal in Geia v Palm Island Aboriginal Council 152 FLR 135, said at [38]-[39]: Employment is not usually referred to, or known as, property. Whatever legal "interest" an employee has in his or her employment, it is not a property interest. In any event, it seems clear from reference to the relevant statutory provisions and the case law that, although the expression "property", and cognate expressions such as "the property of the bankrupt" and "after acquired property", are to be construed in a very wide sense, the bankrupt's employment is not considered "property" for the purposes of the Bankruptcy Act . Indeed, all the pertinent indications in the statute and the case law are to the opposite effect. For example, there are a number of references in the Bankruptcy Act to "property divisible among the bankrupt's creditors" (see, for example, s 58(6) and the definition of "the property of the bankrupt" in s 5) ; it could not seriously be suggested that the bankrupt's employment, or the bankrupt's rights as to his or her employment could be divisible among the creditors. Indeed, the statute recognises that it is most desirable that the bankrupt be able to earn income during the course of the bankruptcy and also contemplates the likelihood that a bankrupt who was an employee prior to the bankruptcy would continue to be in employment. The references we have cited from division 4B of the statute, including the references to ss 139L and 139U are also in point. In particular, we do not detect in the scheme of the Australian statute any provision which would be at odds with the observation in the judgment of the English Court of Appeal in Ex part Vine ; re Wilson, where reference was made to the necessary exception to the property of the bankrupt being divisible amongst his creditors, "in order that the bankrupt might not be an outlaw, a mere slave to his trustee; he could not be prevented from earning his living".