Official Receiver, in the matter of Costas (Bankrupt) [1999] FCA 1050

FEDERAL COURT OF AUSTRALIA

Official Receiver, in the matter of Costas (Bankrupt) [1999] FCA 1050 BANKRUPTCY – appointment of trustee – consent to act as trustee filed in relation to creditor's petition – debtor's petition accepted by Official Receiver – whether Official Receiver or registered trustee appointed as trustee of bankrupt's estate

Bankruptcy Act 1966 (Cth), s156A(1), s156A(3)(a), s156A(4), s160, s55, s157 Bankruptcy Regulations, reg 4.11(1)(d) Federal Court Rules, Order 77 rule 19 Re Close (t/as FB Close Transport); ex parte Abbott (1983) 50 ALR 571, followed Re Agostino; ex parte Jackson (1983) 78 FLR 142, considered

OFFICIAL RECEIVER (IN THE MATTER OF THE BANKRUPT ESTATE OF HARRY COSTAS) N7801 OF 1999

EMMETT J 23 JULY 1999 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N7801 OF 1999

IN THE MATTER OF THE BANKRUPT ESTATE OF HARRY COSTAS

BETWEEN: OFFICIAL RECEIVER

Applicant

JUDGE: EMMETT J

DATE OF ORDER: 23 JULY 1999

WHERE MADE: SYDNEY

THE COURT DECLARES THAT: 1. The Official Trustee is the trustee in bankruptcy of Harry Costas.

THE COURT ORDERS THAT: 2. The application be otherwise dismissed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N7801 OF 1999

IN THE MATTER OF THE BANKRUPT ESTATE OF HARRY COSTAS

BETWEEN: OFFICIAL RECEIVER

Applicant

JUDGE: EMMETT J

DATE: 23 JULY 1999

PLACE: SYDNEY

EX TEMPORE REASONS FOR JUDGMENT 1 I have before me an application by the Official Receiver for an order and a direction determining whether, on the filing of acceptance of a debtor's petition by Harry Costas ("the Debtor"), the trustee in bankruptcy of the Debtor should be the Official Trustee or a registered trustee who had consented to act in connection with a creditor's petition. 2 On 13 May 1999, a consent to act as trustee by Scott Darren Pascoe ("Mr Pascoe") was filed with the Official Receiver in accordance with section 156A(1) of the Bankruptcy Act 1966 (Cth) ("the Act"). That section relevantly provides as follows: "(1) A registered trustee may, by instrument signed by him or her and filed with the Official Receiver consent to act: (a) as the trustee of the estate of the debtor specified in the instrument in the event of the debtor becomes a bankrupt. ………… (3) Where: (a) at the time when a debtor becomes a bankrupt, a registered trustee has, under subsection (1), consented to act as the trustee of the estate of the debtor and the consent has not been revoked, the registered trustee becomes at that time by force of this subsection, the trustee of the estate of the bankrupt." 3 On 2 June 1999, a petition for the sequestration of the estate of the Debtor was presented by the Commonwealth Bank of Australia ("the Bank"). The petition ("the Bank's Petition") was based on an act of bankruptcy consisting of the failure, on or before 20 May 1999, to comply with the requirements of a bankruptcy notice. The Bank's Petition was returnable on 14 July 1999. On that day, the hearing of the Bank's Petition was adjourned to 9.15 am on 20 July 1999. 4 In connection with the Bank's Petition, there was filed an affidavit of service in respect of a consent to act as trustee. By that affidavit, it was proved that, on 8 July 1999, the Debtor was served with a sealed copy of the consent to act as trustee of Mr Pascoe dated 12 May 1999. Service was effected by delivering that document to a Mr Peter Costas, a male apparently over the age of 16 years residing at the Debtor's residential address in New South Wales. 5 If a sequestration order had been made by the Court on the Bank's Petition, there would be little doubt but that Mr Pascoe would, by force of section 156A(3), have been the trustee of the estate of the Debtor upon such bankruptcy. However, on 16 July 1999, the Debtor presented a debtor's petition to the Official Receiver pursuant to section 55 of the Act. That petition was accepted on 19 July 1999. 6 Debtors' petitions are dealt with in Div. 3 of Pt IV of the Act. The scheme of Div. 3 may be summarised as follows: