H J Wigmore & Co Ltd v Rundle

44 CLR 222
1930 - 0911A - HCA

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(Judgment by: Gavan Duffy J, Rich J, Starke J and Dixon J)

H J Wigmore & Co Ltd
v Rundle

Court:

Judge:
Gavan Duffy J, Rich J, Starke J and Dixon J

Subject References:
Bills of Exchange and other negotiable instruments
Hire-purchase agreement
Bill of sale
Debt
Caveat
Promissory notes

Legislative References:
Bills of Sale Amendment Act 1906 (WA) No 13 - ss 8, 9(3)

Hearing date: PERTH 8 September 1930; 11 September 1930;
Judgment date: 11 September 1930

Perth

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Judgment by:
Gavan Duffy J, Rich J, Starke J and Dixon J

GAVAN DUFFY, RICH, STARKE AND DIXON JJ delivered the following written judgment:

The appellant entered a caveat against the registration of a bill of sale lodged by the respondents. The question for decision is whether the appellant is a creditor of the respondents, and so entitled under s. 8 of the Bills of Sale Amendment Act 1906 of Western Australia to enter such a caveat. Sub-s. 1 of this section provides that any person claiming to be a creditor of the grantor may enter a caveat against the registration of the bill of sale. Section 9 (2) provides that "the grantor may summon the caveator before a Judge of the Supreme Court in Chambers to show cause why his caveat should not be removed, and upon the return of such summons the Judge shall hear and determine whether the caveator is a creditor of the grantor." Section 9 (3) provides that "any person to whom the grantor is indebted on any account whatsoever, at law or in equity, ...Whether the debt is due or to accrue due ... shall be deemed to be a creditor within the meaning of this section." The Full Court of the Supreme Court of Western Australia were of opinion that this definition included only debts which were owing whether payable immediately or at some future time, and did not include inchoate debts or debts the title to which was in process of accruing. We agree in this opinion. The word "due" is not unequivocal. It is capable of referring to the time of payment or to the existence of indebtedness (see per Griffith C.J., David v Malouf ^[F1] , at pp. 752-754: see also Ex parte Sturt & Co ; In re Pearcy ^[F2] , at pp. 310-311). In Jones v Thompson ^[F3] , Wightman and Crompton JJ. construed the words all debts "owing or accuring" in s. 61 of 17 & 18 Vict. c. 125 as applying only to cases in which there is debitum in praesenti soluendum in futuro. In Webb v Stenton ^[F4] the Court of Appeal gave this meaning to the words "debts owing or accruing" in Order XLV., r. 2. In our opinion the same construction should be given to the words "debt due or to accrue due" in s. 9 (3).

The question remains whether the respondents at the time of the caveat were indebted to the appellant in any sum payable then or at some future time. This question depends upon the effect of a hire-purchase agreement under which the respondents hired from the appellant an agricultural implement. By this agreement the respondents hired the implement from the date of delivery for a term determinable as afterwards in the agreement mentioned. Among other things, the agreement provided that after payment by the respondents of the sum payable for the first period of the hiring, they were to have the option of determining the hiring by returning the machine to the appellant, and by paying to it all arrears of rental, and an amount for further rental (if the machine should be returned after the first period of hiring) equivalent to a proportionate part of the sum payable for the period current calculated in respect of so much of that period as might have elapsed at the date of such determination. The caveat was in fact entered nineteen days after the termination of the period for which the first instalment of hire was payable and after it had been paid. It follows that even if the hiring were determined upon the day when the caveat was entered, hire for nineteen days would become due and payable. The sum, however, which would be payable for nineteen days hire amounts to only 29s. 5d., and the parties agreed that it might be neglected. Accordingly our judgment is confined to the question whether instalments of future hire constitute a debt; a debt payable at a future time.

The considerations which affect this question have been lately discussed in this Court in Australian Guarantee Corporation v Balding ^[F5] . In this case it is sufficient to say that no substantial distinction can be drawn in any material respect between the agreement now in question and that upon which Helby v Matthews ^[F6] was decided. We are of opinion that the agreement construed as a whole does not contain a promise whether absolute or defeasible to pay future instalments of hire. The provision enabling the hirer to determine the hiring is not a resolutive condition attached to a present obligation to pay future hire, but it is inconsistent with the existence of such an obligation. In other words, a debt arises only in respect of past hire, and this is so whether the agreement runs its full course or is determined by the hirer.

The hire-purchase agreement contained a clause requiring the hirer to give promissory notes as collateral security for the payment of the balance of the rent or hire. Elaborate provision was made both as to the disposition and as to the effect of these instruments. In our opinion, upon the true interpretation of the agreement, these promissory notes did not create an immediate debt but were delivered subject to conditions precedent none of which occurred.

For these reasons we are of opinion that the appeal should be dismissed.