Cartwright v Cartwright & Anor

On a second appeal, permission should be granted where the proposed appeal has a real prospect of success and raises an important point of principle or practice, or another compelling reason for hearing it. A debt may support a bankruptcy petition even if it is not provable, although the court will ordinarily refrain from making a bankruptcy order on that basis except in exceptional circumstances. The scope of the exclusion for obligations arising under orders in family proceedings, and the residual public-policy exclusion for debts which are not provable, may raise substantial questions of statutory construction. Those questions may arise where a foreign maintenance order might have been registrable in England and Wales but was not registered.

Mr Cartwright sought permission for a second appeal from an order of Rimer J dismissing his appeal against a bankruptcy order made by District Judge Field. The petition was brought by his former wife, with his daughter as supporting creditor, relying on a Hong Kong consent order requiring payment of a lump sum and continuing maintenance.

The issue before the Court of Appeal was whether the petition debt was non-provable under Insolvency Rule 12.3(2)(a) or 12.3(3), so that it could not form the basis of the petition. The lower court had held that the Hong Kong order was not within the relevant statutory definition of family proceedings and that the debt was therefore provable.

1. Permission granted. The application satisfied the second-appeal requirements under CPR 52.13. There was a real prospect of success and important points of principle or practice justified appellate consideration.
2. The proposed appeal raised a genuine conflict between decisions of experienced Chancery judges and the Chief Registrar in Bankruptcy concerning the scope of Insolvency Rule 12.3(3). That provision could cover debts excluded from proof on grounds of public policy, including debts arising from illegal transactions, partnership or quasi-partnership relationships, and potentially foreign revenue claims.
3. It was reasonably arguable that, if Parliament had excluded maintenance orders registered in England and Wales from provability, arrears under an equivalent order not registered here might also be excluded. It was also arguable that the Hong Kong order could have been registered under Part I of the Maintenance Orders (Reciprocal Enforcement) Act 1972, since Hong Kong was designated by the Maintenance Orders (Reciprocal Countries) Order 1979.
4. Further questions arose under section 1 of the Administration of Justice Act 1920, including whether the provision applied because of Hong Kong’s constitutional status at the relevant times and whether the order required payment of a sum within the Act. It was also arguable that the order could not be enforced at common law because it remained capable of variation. Beatty v Beatty [1924] 1 KB 807, concerning arrears under a New York maintenance order, was distinguishable on that basis.
5. The appeal was to be listed for half a day or less, preferably before the end of June, with consideration given to including Lord Justices experienced in insolvency and family law. A transcript was directed to be provided at public expense.

• Court of Appeal (Civil Division): Permission granted for a second appeal from Rimer J’s order dismissing the appeal against the bankruptcy order.
• High Court, Chancery Division: Rimer J dismissed the appeal from the bankruptcy order made by District Judge Field.
• St Albans County Court: District Judge Field made the bankruptcy order.