What’s in A Name

Harold Tan explains the High Court's decision in Re Mohd Zuhri Mohd Idris; Ex Parte Bumiputra-Commerce Bank Bhd [2010] 1 CLJ 786

 

 

FACTS

In August 2000, the judgment creditor, Bumiputra-Commerce Bank Bhd, obtained a summary judgment against a judgment debtor by the name of Ahmad Zuhri bin Mohd Idris (“Ahmad”), the bearer of identification card number 660407-10-6207. Ahmad failed to settle the judgment debt, which resulted in the judgment creditor taking bankruptcy proceedings against him.

 

Due to an inadvertent clerical mistake, the bankruptcy notice and creditor’s petition had the name Mohd Zuhri bin Mohd Idris (“Mohd”) endorsed on them as the judgment debtor instead of Ahmad’s name. The identification card number endorsed on the bankruptcy papers was nevertheless correct.

 

Although having been personally served with the bankruptcy notice and creditor’s petition, Ahmad chose not to take part in the bankruptcy proceedings. Ahmad took the position that he need not attend court since it was not his name on the bankruptcy papers. The hearing of the creditor’s petition went ahead despite Ahmad’s non-attendance. The creditor’s petition was granted by the court and receiving and adjudication orders were made.

 

Unfortunately for Ahmad, since his identification card number was the same as that endorsed on the bankruptcy papers, he was somehow linked to the bankruptcy proceedings and this affected his credit status adversely. Ahmad then made an application to set aside the receiving and adjudication orders and to strike out the related creditor’s petition. His application was dismissed by the High Court. His appeal to the Court of Appeal is currently pending.

 

The judgment creditor on the other hand applied to court seeking an order to amend Mohd’s name in the bankruptcy papers as well as the receiving and adjudication orders to Ahmad’s name. The amendment application was allowed by the registrar. Ahmad appealed against that decision to the High Court Judge.

 

 

FINDINGS OF THE HIGH COURT JUDGE

Counsel for Ahmad submitted that the appeal ought to be allowed for reason that the court had no jurisdiction to amend the receiving and adjudication orders once the orders were granted and sealed by the court. In other words, counsel argued that the court was functus officio to amend the sealed orders and bankruptcy papers.

 

This argument did not find favour with the Judge. On the reading of the relevant provisions of the Bankruptcy Act 1967, in particular sections 91 and 93, and the Bankruptcy Rules 1969, the Judge held that these legislation were wide enough to confer on the bankruptcy courts jurisdiction to determine all questions, whether of law or fact, in any case of bankruptcy. This included the power to amend cause papers relating to the bankruptcy process or proceeding, even after the process or proceeding had concluded.

 

However, the Judge found on the facts and circumstances of the case that the registrar had erred in her exercise of the court’s discretion in granting the judgment creditor’s application to substitute Mohd’s name with Ahmad’s name in the bankruptcy papers and orders.

 

The learned Judge held that as bankruptcy is semi-penal in nature, there must be strict compliance with the requirements under the bankruptcy laws. The Judge held that pursuant to rule 94(1)(aa) of the Bankruptcy Rules 1969, every bankruptcy notice must be endorsed with both the name and identification card number of the debtor, without which the relevant documents were not brought properly before the court, until and unless amended.

 

Good reasons must be given for the court to determine whether an application to amend is to be allowed. In this case, the only reason offered by the judgment creditor in support of its application was inadvertent regrettable clerical error. The judgment creditor also claimed that no prejudice would be occasioned by the amendment.

 

The Judge held that the reason offered by the judgment creditor was insufficient to warrant the court exercising its discretionary power to grant the amendment.

 

In her judgment, the Judge emphasised the importance in bankruptcy proceedings that the identity of the debtor and the debt be stated accurately in the bankruptcy papers and that the onus lies on the creditor to ensure that these requirements are complied with.

 

The learned judge held that in the identification of the debtor, there is a difference between getting a name right and getting the spelling of a name right. In this instance it was the former and for that reason alone, the amendment must be refused.

 

The Judge further held that even if the amendment was within the intent of section 93 of the Bankruptcy Act 1967 which gives the court the power to amend any written process or proceeding upon such terms as the court seems fit, reasons had to be forthcoming. There was none here except for the mere averment of clerical error and the contention that Ahmad would not be prejudiced. The court rejected the judgment creditor's contention and found that Ahmad had been prejudiced as he had been deprived of the opportunity to respond to the creditor’s petition due to the error. The Judge added that the effect of being a bankrupt was also in itself prejudice.

 

Ahmad's appeal was therefore allowed.

 

 

CONCLUSION

This case is noteworthy as it serves as a reminder that special care must be taken to ensure that the stringent requirements of the law, particularly that in bankruptcy proceedings, are complied with. In the Judge’s own words, “a simple clerical error may end up being fatal”.

 

 

HAROLD TAN KOK LENG ( This e-mail address is being protected from spambots. You need JavaScript enabled to view it )

 

 
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