Case: Re Forbes (1974) 24 FLR 87 
Outcome: discussed
In Re Forbes (1974) 24 FLR 87, White J of the Court of Insolvency of South Australia discussed Part IX and s 187 of the Bankruptcy Act . The issue there identified was not the putting of a composite proposal, but the putting of a composite proposal to one undifferentiated meeting. The essence of the matter was put at pages 88 and 93, as follows: In my opinion, this procedure is not open to debtors under Part X and the alleged composition is void. They should have held separate meetings (albeit concurrently) to which separate special resolutions could have been submitted to the relevant classes of creditors, in order that the wishes of interested parties be ascertained, including the existence or otherwise of the appropriate majorities both in number and value. Where there are joint creditors, it is a matter of necessity rather than convenience that meetings are held at the one time and the one place. As will be seen later, care must be taken at such concurrent meetings to separate out the different resolutions relating to each debtor and the classes of creditors entitled to vote in relation to each resolution. ... I am happy to say that I reached this conclusion before reading Mr Irlicht's small but excellent book "Assignments, Arrangements and Compositions by Debtors" where he expresses the opinion ...: "There should be a separate meeting with respect to each debtor, although there is no objection against holding meetings of more than one debtor concurrently, providing that a special resolution is passed with respect to each debtor (of course only the creditors of the debtor in question can vote on the relevant resolution, but creditors to whom debtors are jointly indebted may vote on the resolutions with respect to each debtor). This procedure of holding concurrent meetings is best adopted when there are a number of joint debtors". 65 The case does not assist with the question whether one group of creditors should not have the opportunity to vote on a proposal which involved another debtor. 66 In Re Edwards 14 FCR 113 French J dealt with one joint composition covering two estates, a joint estate and a several estate. Despite some of the language in the judgment, it is clear that the vice identified by his Honour was the single approval for all the estates in one meeting. This can be seen by his Honour's reliance upon the reference to Re Forbes 24 FLR 87. French J said the following at 116: In a case where the bankrupts have some joint creditors and some separate creditors it would be inappropriate to submit the separate creditors to a binding composition on which they may have been out-voted by joint creditors with quite different interests. Similarly it would be inappropriate to admit to a vote on a joint composition, separate creditors whose interests might conflict with those of the joint creditors. Re Forbes was a decision of Judge White in the Court of Insolvency of South Australia in which his Honour declared void a composition purportedly entered into under Part X of the Act, by a husband and wife who were not in partnership but who had substantial joint creditors. Each also had separate debts. A joint meeting of creditors was called at which a composite special resolution was passed. Creditors of all classes voted on the composite resolution. His Honour then quoted White J at page 88. French J concluded his judgment by saying: The proposal if it is to be proceed will have to be recast in the form of separate proposals for each of the bankrupts. Each will require a separate meeting of creditors although the meetings can be held concurrently provided that the procedure necessary to maintain the distinction between the two proposals is followed. On this basis I have no alternative but to dismiss the application. 67 In Re Tynan 16 FCR 307, French J had a case before him where there were bankrupts who had been partners with no separate bankrupt estate. Some passages of the judgment of French J appear, taken literally, to prevent under s 73 any joint composition to be entered where there is more than one estate. I do not think his Honour's reasons should be so read, especially in the light of the terms of Re Edwards 119 FCR 113 in the same year. By his Honour's reference to Re Pepper 14 FLR 282 and Re Edwards 14 FCR 113 (and through it Re Forbes 24 FLR 97) and via what his Honour said at pages 312 and 313 about the need for separate meetings, I conclude that his Honour was dealing with the same essential difficulty, that is, of mixing up the voting of different creditors at different meetings.