In Dawodo v American Express [2001] BPIR, then sitting as a High Court Judge, Mr Justice Etherton, the former Master of the Rolls handed down this leading judgment on the doctrine of inquiry / duty of inquiry within jurisdiction of the insolvency court.
Etherton J summarised the long established law where there is no res judicata in the insolvency court where it can be shown that there is no debt owed to a creditor, or one claiming to prove, with case law on the duty of inquiry dating back to the early 1800s.
Dawodo v American Express & ‘going behind a judgment’ in bankruptcy
This authority is particularly useful as it condenses the relevant case law, giving brief analysis of the following authorities of the insolvency / bankruptcy court on the issue:
Re Flatan [1889] 22 QBD 83, Re Lennox (1885) 16 QBD 315, Re Hawkins (1895) 1QB 404, McCourt v. Baron Meats Limited (1997) BPIR 114, Ex parte Kibble, Re Onslow (1875) LR 10 Ch, Ex parte Banner, Re
Blythe (1881) 17 ChD 480, and lastly, as below, the crucial paragraph in our view, which summarises what the court requires to enable the duty of inquiry / going behind a judgment (bold for emphasis):
“My only qualification to the summary by Warner J. is that the cases establish that what is required before the Court is prepared to investigate a judgment debt, in the absence of an outstanding appeal or an application to set it aside, is some fraud, collusion, or miscarriage of justice. The latter phrase is of course capable of wide application according to the particular circumstances of the case. What in my judgment is required is that the Court be shown something from which it can conclude that had there been a properly conducted judicial process it would have been found, or very likely would have been found, that nothing was in fact due to the Claimant. It is clear that in those circumstances the Court can enquire into the judgment and the judgment debt, even though the debtor himself has previously applied to have the judgment set aside, and even though that application has been refused and that refusal has been affirmed by the Court of Appeal see Re Fraser [1892] 2QB 633″
We include below in our PDF viewer, the full judgment in Dawodo v American Express.
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