Official Trustee in Bankruptcy v Kent [2023] FCA 1211

Federal Court of Australia Official Trustee in Bankruptcy v Kent [2023] FCA 1211 File number: NSD 272 of 2022

Judgment of: RARES ACJ

Date of judgment: 11 October 2023

Catchwords: BANKRUPTCY AND INSOLVENCY – meaning of 'property', 'property of the bankrupt' and 'property divisible amongst the creditors of the bankrupt' in ss 5(1) and 116 of Bankruptcy Act 1966 (Cth) – where s 912A(1)(g)(i) and (2) and Pt 7.10A of Corporations Act 2001 (Cth) required financial services licensees to be members of dispute resolution scheme to deal with complaints by retail clients of licensees – where s 1051(4)(e) of Corporations Act required determination under scheme to be binding on licensees if complainant accepted it – where Australian Financial Complaints Authority Ltd (AFCA) operated scheme – where s 116(2)(g)(i) of Bankruptcy Act excepted from property of bankrupt divisible amongst creditors any right of bankrupt to recover compensation for personal wrong and any compensation awarded in respect of such wrong where, after discharge, bankrupt made complaint to AFCA under scheme about pre-bankruptcy loans by licensee – where subject matter of complaint could comprehend contravention of civil penalty provision or offence under s 133(1) and (6) of National Consumer Credit Protection Act 2009 (Cth) (NCCP Act) of entry into credit contract with consumer that was unsuitable for him or her (irresponsible lending) – where s 178(1) and (2) gave right only to a consumer who had suffered loss or damage if licensee contravened or offended against NCCP Act to apply to court for an order to compensate him or her for loss or damage from contravention of offence – where licensee acknowledged irresponsible lending in answering complaint – where licensee and trustee in bankruptcy, without consent of bankrupt, entered into deed to resolve complaint on final basis for financial loss sum to be paid to trustee for distribution to unsecured creditors and balance to bankrupt – whether right to make complaint under AFCA scheme property at all or property of bankrupt that vested in trustee under s 58(1) of Bankruptcy Act – where only bankrupt and not trustee could make complaint to AFCA under scheme – whether right to apply for order under ss 178(2) and 179(3) of NCCP Act property at all or property of bankrupt that vested in trustee under s 58(1) of Bankruptcy Act – whether right to make complaint under scheme or apply for order under ss 178(2) and 179(3) of NCCP Act right to recover compensation for personal wrong within exception to s 116(2)(g)(i) of Bankruptcy Act – where trustee not entitled to claim or receive any compensation or settle complaint under scheme