GROUNDS OF JUDGMENT.

A bankruptcy notice dated November served against one Dr. R Ramachandran to as the judgment debtor), by one Ganeswary a/p Ponnudurai (hereinafter referred to as the judgment creditor) for the sum of RM35,547.50 with interest of RM1478.50 April 1, 1997 until October 15, 1997. The source of that bankruptcy notice had stemmed from allocatur emanating from Kes Sivil Dl-28- 5, 1997 had been (hereinafter referred 8.50 calculated from an alleged flawed 16-92.

[1]

The bone of contention materialized came the filing day of the bankruptcy notice by the debtor on December 12, 1967, pursuant to section 3 (2) (ii) of the Bankruptcy Act 1967, disputing its validity. It is trite that a bankruptcy notice is to alert a debtor of the sum he has to pay up as denoted in the document, founded on a final judgment or order against the debtor, in order to avoid bankruptcy. On the other hand, if the bankruptcy notice were to be declared invalid, then naturally any subsequent proceeding, in particular the petition will be null and void (Re Khaw Siew Suan; ex parte Asia Commercial Finance (M) Bhd [2000] 8 CLJ 516).

The judgment debtor here had alleged that the gross sum of the abovementioned allocatur had its source from the combined sum of three entirely separate orders. And this flawed allocatur, pursuant to Order 59 rule 33 of the Rules of the High Court 1980, was the very source of the bankruptcy notice. The judgment debtor thereupon took up issue and applied to set aside that impugned notice. The Deputy [2] Registrar had heard it eventually on September 3, 1998 and had eventually rejected it. Being dissatisfied, the debtor had filed an appeal to the judge in chambers, and after hearing it I had allowed the appeal with costs. I now supply my reasons for that decision.

It is quite normal that a presiding judge may not quantify costs in a final order insitu, safe in the thought that the matter will be resolved later, by the Senior Assistant Registrar vide the allocatur. The latter, bearing the results of the taxation of a final order, may certainly be adverted to as the basis of any bankruptcy proceeding (Low Mun v Chung Khiaw Bank Ltd [1987] CLJ 172 (Rep); [1987] 2 CLJ 400; [1988] 1 MLJ 2633). Abdul Malek Ahmad JCA (as His Lordship then was) in Khoo Kay Hoe v Chor Phaik Har [1999] 3 CLJ 1; [1999] 3 MLJ 124 had occasion to state:

"In essence the allocatur merges with the order for costs....................................................................................................... [3] Would they not be liable to pay the costs stated in the allocatur? We hold that they would be and this attempt to say that bankruptcy proceedings cannot be based on an allocatur when no steps had been taken to set them aside merely denotes that if we were to agree with this technicality, the respondent would not have any recourse at all to recover the costs against the appellants despite the final judgment or order. This would render the final judgment or order meaningless."

Why then my rejection of the bankruptcy notice based on the current allocatur? I had taken that course of action as I had found that impugned bankruptcy notice wanting, it being founded, inter alia, on an allocatur, which had subsisted on more than one final judgment or order. It thus had contravened the requirements of bankruptcy law. Statutorily, it is established law that creditor is not entitled to apply for the issuance of a bankruptcy notice by combining two or more final judgments or final orders, be they from the same suit or [4] not. Rule 91 (2) of The Bankruptcy Rules 1969 promulgates as follows:

"A creditor is not entitled to apply for the issue of a bankruptcy notice by combining two or more final judgments or final orders."

The court in Re Chen Chong Fatt Willy ex parte Hitachi Lease (Singapore) Pte Ltd [1987] 1 MLJ 94 in clear terms had opined:

"It is well accepted that a bankruptcy petition cannot be founded on two separate judgments even though it may be o

Click Here to Read the rest of this document