The Minister for Communications, Energy and Natural Resources v Wymes

• Jurisdiction: Ireland
• Judge: Ms. Justice Pilkington
• Judgment Date: 05 April 2019
• Neutral Citation: [2019] IEHC 245
• Docket Number: NO:4549
• Court: High Court
• Date: 05 April 2019

THE MINISTER FOR COMMUNICATIONS, ENERGY AND NATURAL RESOURCES

AND

MICHAEL O'CONNELL

PETITIONERS

AND

MICHAEL WYMES

RESPONDENT

[2019] IEHC 245

NO:4549

THE HIGH COURT

BANKRUPTCY

Bankruptcy – Application to show cause – Adjudication order – Respondent applying to show cause pursuant to his adjudication of bankruptcy – Whether the petition was irregular and invalid

Facts: The respondent, Mr Wymes, applied to the High Court to show cause pursuant to his adjudication of bankruptcy by order of Meenan J on 23 March 2018. Mr Wymes submitted that the subject adjudication order ought not to have been made by virtue of the following reasons and defences: (a) the petition was irregular and invalid; (b) the claimed indebtedness was statute barred; (c) the petition was tainted by ulterior, collateral and improper purpose/economic duress and wrongdoing towards a collusive grossest of undervalues for the lands of Mr Wood; (d) the existence of an accommodation between Mr Wood and the petitioners, the Minister for Communications, Energy and Natural Resources and Mr O’Connell; (e) oppression consequent to the bankruptcy process being prolonged to March 2018 although readily available as a remedy since 31 July 2013 i.e. an extant period of some fifteen years; (f) a form of execution had issued which remained to be proceeded upon; and (g) the proceedings were of public interest and importance.

Held by Pilkington J that the grounds set out above had been considered previously and no judgment of any Court had found that any of those grounds advanced should operate, to quote from s. 135 of the Bankruptcy Act 1988, to ‘review, rescind or vary an order made by it in the course of a bankruptcy matter’. Pilkington J held that all of the matters had been raised previously within the bankruptcy process and could not be advanced within this application to show cause.

Pilkington J held that Mr Wymes’ application to show cause would be rejected. Pilkington J was satisfied that Mr Wymes had failed to satisfy the criteria within s. 16 of the 1988 Act.

Application refused.

JUDGMENT of Ms. Justice Pilkington delivered on Friday the 5th day of April, 2019.

1 This is an application by the respondent (“Mr. Wymes”) to show cause pursuant to his adjudication of bankruptcy by Order of Meenan J. on 23 March 2018.

2 On 31 May 2018 Mr. Wymes filed his notice to show cause against the validity of that adjudication. I propose to set out that notice in full. It is as follows: -

‘ NOTICE IS HEREBY GIVEN that the said Michael Wymes intends to show cause to the High Court against the validity of the adjudication of bankruptcy made on the 20th day of March 2018 against him, on the grounds, inter alia, that the following requirement(s) of s. 11 (1) of the Bankruptcy Act, 1988, have not been complied with: (1) There was no act of bankruptcy committed by him within the three months previous to the presentation of the petition, to found the petition which issued on 11 June 2010, and the adjudication on foot thereof dated 20 March 2018.

(2) The petition was not a valid petition in that: -

(a) It did not recite the specific order of bankruptcy on which the petition was founded, as required by O. 76, r. 19(1)(b);

(b) The act of bankruptcy alleged in it was not, by reference to s. 7 (1) of the Act, an act of bankruptcy identified in statute or recognised at law;

(c) There was no affidavit filed on the presentation of the petition which factually proved an act of bankruptcy, such a filing being a requirement of O. 76, r. 21.

An affidavit setting out in detail the grounds of the application to show cause has been filed and is served herewith.’

3 The reference to Mr. Wymes” adjudication of bankruptcy being 20 March 2018 is the reference to the judgment of Meenan J. of that date, but the Order so was in fact made on 23 March 2018. Mr. Richard Wood was also adjudicated bankrupt on that day but this application is only brought by Mr. Wymes. Mr. Wymes appears to periodically have the assistance of a solicitor but appeared as an applicant in person throughout this application.

4 In respect of this application to show cause, Mr. Wymes swore an affidavit on 1 June 2018, Ms. Grainne Uí Thuama on behalf of the petitioners on 20 July 2018 and thereafter a supplemental affidavit of Mr. Wymes sworn on 23 August 2018.

5 This matter has a significant and difficult history. This however is a discrete application pursuant to s. 16 of the Bankruptcy Act 1988, as amended (‘the 1988 Act’). The case law and indeed the section itself makes it clear that any application to show cause must be carefully construed pursuant to its terms.

6 Section 16 of the 1988 Act states as follows: -

‘16. — (1) The bankrupt may, within three days or such extended time not exceeding fourteen days as the Court thinks fit from the service of the copy of the order of adjudication on him, show cause to the Court against the validity of the adjudication.’

In the affidavit sworn by Mr. Wymes on 1 June 2018 grounding his application he avers that the Order of Meenan J. was served on him on 29 May 2018; his application to show cause shows it was filed on 31 May 2018 so the requirements of s. 16(1) are satisfied.

Section 16 (2) and (3) state: -

‘(2) On an application to show cause under subsection (1) the Court shall, if within such time the bankrupt shows to its satisfaction that any of the requirements of section 11 (1) have not been complied with, annul the adjudication and may, in any other case, dismiss the application or adjourn it on such conditions as the Court thinks fit, having regard to the interests of the bankrupt, his creditors and any persons who might advance further credit to him.

(3) Nothing in this section shall be construed to prevent the immediate seizure of the goods of the bankrupt on his adjudication.’

7 In construing s. 16(2) it is also necessary to consider s. 11(1) of the 1988 Act. It states: -

‘11. — (1) A creditor shall be entitled to present a petition for adjudication against a debtor if —

(a) the debt owing by the debtor to the petitioning creditor (or, if two or more creditors join in presenting the petition, the aggregate amount of debts owing to them) amounts to more than €20,000,

(b) the debt is a liquidated sum,

(c) the act of bankruptcy on which the petition is founded has occurred within three months before the presentation of the petition, and

(d) the debtor (whether a citizen or not) is domiciled in the State or, within three years before the date of the presentation of the petition, has ordinarily resided or had a dwelling-house or place of business in the State or has carried on business in the State personally or by means of an agent or manager, or is or within the said period has been a member of a partnership which has carried on business in the State by means of a partner, agent or manager.’

8 Section 11(1) of the 1988 Act is the criteria which must also be satisfied upon the presentation of a petition for the adjudication of a debtor as a bankrupt. The consideration of s. 11(1) in the context of Mr. Wymes” application to show cause will be considered below.

9 In considering s. 11(1) it is clear that the criteria set out at (a) and (b) are satisfied. This debt arises pursuant to an Order of the High Court in favour of the petitioners dated 25 February 1997 for a sum vastly in excess of the €20,000 threshold. Section 11(1)(d) does not arise in the present application as there is no issue as to domicile.

10 In considering the grounds advanced by Mr. Wymes to show cause it is clear that the only portion of s. 11(1) with which he takes issue is s. 11(1) (c) which is the requirement that the act of bankruptcy on which a petition is founded has occurred within three months before the presentation of the petition. All of the other grounds which Mr. Wymes advances within his application to show cause are not matters within the ambit of s. 11(1) of the 1988 Act.

11 The affidavit grounding the application of Mr. Wymes to show cause is extensive and runs to some 396 paragraphs over 77 pages. It is noteworthy that whilst the grounds within the notice to show cause are reflected on its face as quoted in full at paragraph 2 above; yet within his affidavit a significant number of other additional grounds/ criteria are advanced in support of his application to show cause against the adjudication of bankruptcy.

12 At paragraph 9 of his grounding affidavit Mr. Wymes avers;

‘It is respectfully submitted that the subject adjudication order ought not to have been made by virtue of the reasons and defences as follows: -

(a) The petition was irregular and invalid as (the matters recited on the face of the notice to show case are set out here as recited at paragraph 2 above)

Mr. Wymes continues to advance the following grounds: -

(b) The claimed indebtedness was statute barred.

(c) The petition was tainted by ulterior, collateral and improper purpose/economic duress and wrongdoing towards a collusive grossest of undervalues for the lands of Mr. Wood.

(d) The existence of an accommodation between Mr. Wood and the petitioners.

(e) Oppression consequent to the bankruptcy process being prolonged to March 2018 although readily available as a remedy since 31 July 2013 i.e. an extant period of some fifteen years.

(f) A form of execution had issued which remained to be proceeded upon.

(g) The proceedings were of public interest and importance.

13 It is fair to say and I will deal with this in more detail below, that the affidavit and indeed the written and oral submissions of Mr. Wymes trespassed significantly beyond the ambit of s. 16 of the 1988 Act. Indeed, on occasion Mr. Wymes sought to deal with matters raised throughout this lengthy litigation. It is also noteworthy that not only have many of these matters been raised previously but they have already been dealt with comprehensively by the Courts.

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