Albert, in the matter of Albert (Bankrupt) v Lock (Trustee)
[2016] FCA 1547
•16 December 2016
FEDERAL COURT OF AUSTRALIA
Albert, in the matter of Albert (Bankrupt) v Lock (Trustee) [2016] FCA 1547
File number: NSD 2117 of 2016 Judge: YATES J Date of judgment: 16 December 2016 Catchwords: BANKRUPTCY AND INSOLVENCY – review of trustees’ decision to impose conditions upon bankrupt’s proposed travel – consideration of just and equitable order Legislation: Bankruptcy Act 1966 (Cth) ss 77, 139P, 139Q, 139S, 139W, 139ZA, 139ZF, 139ZG, 139ZI, 178, 272 Cases cited: Lockwood v Vince [2007] FMCA 1497
Macchia v Nilant (2001) 110 FCR 101; [2001] FCA 7
Re Hicks; Ex parte Lamb (1994) 217 ALR 195; [1994] FCA 1473
Re Tyndall, Ex parte Official Receiver (1977) 17 ALR 182
Weiss v Official Trustee in Bankruptcy (1983) 1 FCR 40
Date of hearing: 15 December 2016 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: General and Personal Insolvency Category: Catchwords Number of paragraphs: 61 Solicitor for the Applicant: Mr K Nath of Diamond Conway Counsel for the Respondents: Mr NJ Simpson Solicitor for the Respondents: Eakin McCaffery Cox ORDERS
NSD 2117 of 2016 IN THE MATTER OF THE BANKRUPT ESTATE OF MARC DAVID ALBERT
BETWEEN: ANNE MARIE ALBERT
Applicant
AND: IAN LOCK AND DAVID SHEAHAN AS TRUSTEES OF THE BANKRUPT ESTATE OF MARC DAVID ALBERT
Respondents
JUDGE:
YATES J
DATE OF ORDER:
16 DECEMBER 2016
THE COURT NOTES:
1.The undertaking given by the bankrupt, Marc David Albert, that if provided with his passport by the respondents, he will use that passport only for the purposes of travel between Australia and Bali in the period of 4 to 18 January 2017 and that upon his return to Australia he will deliver his passport to the respondents by no later than 23 January 2017.
THE COURT ORDERS THAT:
2.On the basis of the undertaking given by the bankrupt, on or before 3 January 2017 the respondents provide consent in writing to the bankrupt permitting him to travel between Australia and Bali in the period 4 to 18 January 2017, and deliver the bankrupt’s passport to him to enable that travel.
3.The respondents pay the applicant’s costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
YATES J:
INTRODUCTION
This is an application brought under s 178 of the Bankruptcy Act 1966 (Cth) (the Act) which provides that if a bankrupt, a creditor or any other person is affected by an act, omission or decision of the trustee in bankruptcy, that person may apply to the Court and the Court may make such order in the matter as it thinks just and equitable.
The application is brought by the bankrupt’s wife, Anne Marie Albert. No question has been raised as to her standing.
The application concerns the bankrupt’s request to undertake travel to Bali between 4 and 18 January 2017. This request was originally made on 8 November 2016 and initially refused by the respondents on 21 November 2016. This prompted the applicant, through her solicitors, to write to the respondents on 5 December 2016 requesting their reconsideration of that decision. They did so. On 6 December 2016 they wrote to the bankrupt stating that they consented to his request subject to two conditions. The first was that he pay, within seven days, the whole of the income contributions that the respondents had assessed for the contribution assessment periods 14 May 2015 to 13 May 2016 and 14 May 2016 to 13 May 2017. The total amount of these assessments is $96,063.50. The assessments were only made and notified on 6 December 2016 (ie, on the same day as the respondents notified the bankrupt of their conditional consent). The respondents informed the applicant that, on payment of this total amount, they would release his passport to him. The second condition was that the bankrupt undertake that he would return his passport to the respondents by 23 January 2017.
There is no dispute about the second condition. The focus of the present application has been the first condition. The applicant argues that its imposition is unreasonable and, for reasons I will explain, unwarranted because it would not assist in the administration of the bankrupt’s estate. Further, the bankrupt has given evidence that he proposes to challenge the assessments, although plainly the validity of the assessments is not a matter that falls for determination in this application.
On 8 December 2016, the applicant filed the Application commencing this proceeding. The matter came before me as the Commercial and Corporations Duty Judge on 9 December 2016 for case management, at which time I made procedural directions and set the matter down for hearing on 15 December 2016.
RELEVANT LEGISLATION
A bankrupt must give his or her passport to his or her trustee in bankruptcy: s 77(1)(a)(ii) of the Act. It is an offence, punishable by imprisonment, for an undischarged bankrupt to leave Australia, or to do an act preparatory to leaving Australia, without the consent in writing of the trustee: s 272(1)(c). The trustee can impose written conditions on a consent given for the purposes of s 272(1)(c), which may include a condition regarding payment of a contribution under s 139P or s 139Q: s 272(2). If a bankrupt contravenes a condition imposed by the trustee, the bankrupt commits an offence punishable by imprisonment: s 272(3).
A bankrupt is liable to pay contributions to his or her bankrupt estate from income earned in a contribution assessment period: s 139P and s 139Q. The trustee is to make an assessment of the income that is likely to be derived, or was derived, by the bankrupt during the contribution assessment period and of the contribution, if any, that the bankrupt is liable to pay: s 139W. This assessment is worked out in accordance with a statutory formula: s 139S.
The contribution is payable at such times as the trustee determines: s 139ZG(1). The trustee must give written notice of such determination: s 139ZI(1). Importantly, the time at which a payment is to be made must not be earlier than 14 days after notice in relation to the determination is given: s 139ZI(3).
In the present case, the assessments were made, as I have said, on 6 December 2016. The assessments did not themselves specify a date for payment. However, the letter by which the assessments were communicated, also dated 6 December 2016, stated that the aggregate contribution liability was “now due and payable”.
At the hearing of this application, the trustees were unable to explain how this determination was made consistently with the minimum 14 day period mandated by s 139ZI(3) of the Act to which s 139ZG(1) is expressed to be subject. This, then, calls into question the correctness of the respondents’ imposition of the first condition of their consent to the bankrupt’s proposed travel to Bali, which required payment within seven days of notification that the assessments had been made.
The Inspector-General may review a decision of a trustee to make an assessment: s 139ZA. On a review of a decision, the Inspector-General has all the powers of the trustee and may either confirm the decision or set aside the decision and make a fresh decision under s 139W(2): s 139ZD. An application may be made to the Administrative Appeals Tribunal to review a decision of the Inspector-General in this regard: s 139ZF. These reviews concern the making of an assessment under s 139W, not a determination under s 139ZG(1).
BACKGROUND TO THE APPLICATION
On 14 May 2015, a sequestration order was made against the bankrupt on a creditor’s petition. At that time, the respondents were appointed as joint and several trustees of the bankrupt’s estate.
As at 13 December 2016, the respondents had received proofs of debt from three creditors, totalling in excess of $10.6 million. The largest of these creditors is the Australian Taxation Office ($7,376.421.61). The bankrupt’s statement of affairs discloses further unsecured debts, totalling in excess of $580,000. Therefore, the total debts of the estate exceed $11.1 million.
The bankrupt was publicly examined on 6 September and 5 December 2016. On 5 December 2016, the summons issued to him, the bankrupt, was adjourned generally, but with leave to approach the Registry within six months to seek a new date for the bankrupt’s further examination and the examination of any other relevant person. It is the respondents’ intention to examine the applicant although, as I understand it, no summons has yet been issued.
The applicant and the bankrupt have been married for 25 years. They live in rented accommodation in Sydney. They arrived in Australia in 2002. They have two adult children, both of whom are living with their parents, have part-time employment and are undertaking university studies. The bankrupt has an older daughter, who also lives in Sydney. She is the mother of the bankrupt’s granddaughter, who was born earlier this year.
The bankrupt’s father has been resident in Australia since before 2002. The bankrupt’s mother, who is 85 years old, relocated to Sydney from the United Kingdom about 18 months ago. She has applied to become a permanent resident.
The bankrupt is currently employed. His weekly net income from that employment is approximately $1,200. His personal and living expenses have been met by family and friends. His mother pays for most of the family’s living expenses, with the bankrupt contributing to the rental of the premises where he, the applicant and their two children live.
On 14 April 2014, the bankrupt appointed a controlling trustee with a view to entering into a personal insolvency agreement under Pt X of the Act. The bankrupt says that, at that time, he had no assets.
On 20 May 2014, he travelled to the United Kingdom to seek financial assistance to help him fulfil the proposal under the proposed personal insolvency agreement.
On 14 August 2014, the bankrupt’s creditors voted against the personal insolvency agreement and, on 16 August 2014, having been unsuccessful in obtaining the financial assistance he was seeking, the bankrupt returned to Australia.
On 3 October 2014, the bankrupt, the applicant and their son, travelled to Bali for a holiday. They returned on 12 October 2014.
On 2 March 2015, the bankrupt and the applicant travelled to the United States of America and the United Kingdom to visit family. As I have noted, on 14 May 2015, the sequestration order was made. The bankrupt and the applicant returned to Australia on 31 July 2015.
On 11 September 2015, the bankrupt, the applicant and the three children travelled to Bali, returning on 26 September 2015.
The trips I have noted at [19]-[23] above were paid for by the applicant.
On 11 July 2016, the bankrupt and the applicant were seeking to leave Australia for a further holiday in Bali when they were stopped by the Australian Federal Police in the passport processing area at Sydney International Airport. The bankrupt was informed that he could not travel overseas without the consent of the respondents.
The bankrupt has given evidence that, prior to being so informed, he was not aware that he had to surrender his passport to the respondents or that he was not permitted to depart from Australia without their consent. The bankrupt was not challenged on this evidence and I have no reason not to accept it. Indeed, his expressed state of mind is supported by the fact that he was able to depart and re-enter Australia freely on 11 September and 26 September 2015 whilst a bankrupt.
On 13 July 2016, the bankrupt contacted the respondents at which time they informed him that he could not travel overseas without their consent and that he was required to surrender his passport to them. The bankrupt was also informed that an examination summons had been issued against him.
On 26 July 2016, the bankrupt surrendered his passport to the respondents. On the same day, he sought the respondents’ consent to resume the holiday he had attempted to take earlier that month. On 27 July 2016, the respondents refused the bankrupt’s request.
On 12 September 2016, the bankrupt again sought the respondents’ consent to travel to Bali with the applicant. On 14 September 2016, the respondents refused that request.
As I have noted, the bankrupt’s request to travel to Bali, giving rise to the present application, was made on 8 November 2016.
The purpose of the present request is that the bankrupt and the applicant wish to celebrate the applicant’s fiftieth birthday in Bali with their family and friends. The applicant has given evidence that Bali has been her and the bankrupt’s preferred holiday destination over the past few years, partly due to its affordability and proximity to Australia as a tropical destination. She said that, in the past few months, she has had several discussions with her United Kingdom-based family and friends about her birthday plans. It seems that they are ready and able to book their flights to and accommodation in Bali as soon as the applicant lets them know that her own travel plans have been finalised.
The bankrupt has expressed his desire to be part of the birthday celebrations that the applicant is seeking to arrange. Although it would seem that the bankrupt’s three children will also travel to Bali for this occasion, the bankrupt’s elderly parents will remain in Australia.
The applicant and the bankrupt have each deposed that they will return to Australia if the bankrupt is permitted to travel as proposed.
RELEVANT PRINCIPLES
In Macchia v Nilant (2001) 110 FCR 101; [2001] FCA 7, French J (at [38]) discussed the nature of the jurisdiction conferred by s 178 in the following terms:
Section 178 confers a “supervisory jurisdiction over the conduct of the trustee”: Cummings v Claremont Petroleum NL (1996) 185 CLR 124 at 133 (Brennan CJ, Gaudron and McHugh JJ). It confers a power to “in substance” review the decision of the trustee: McGoldrick at 556. The power is necessarily judicial: Re Wheeler; Ex parte Wheeler v Halse (1994) 54 FCR 166 at 170 (Lee J). In the latter case Lee J said that the Court could not, in an application under s 178, be asked to perform the administrative function of a trustee administering an estate in bankruptcy. It is given original jurisdiction, the exercise of which might entail “orders of a supervisory character insofar as the determination of questions of law raised by the application require those orders to be made” (169). The applicant “must show a ground on which the trustee’s administration of the affairs of the bankrupt is to be reviewed”. That proposition must be read with the generic concept of review in the original jurisdiction of the Court as one which can, according to context, enliven “the jurisdiction of the court in respect of the whole matter” raising issues of either or both law and fact: Western Australia v Strickland (2000) 99 FCR 33 at
49-50, citing inter alia, Re Tyndall. Some functions which are administrative in character when exercised by an administrator have the chameleon quality of becoming judicial when exercised by a court: Commissioner of Taxation (Cth) v Munro (1926) 38 CLR 153 at 175-179 (Isaacs J); R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd (1971) 123 CLR 361 at 363 (Kitto J); Cominos v Cominos (1972) 127 CLR 588 at 606 (Mason J). In relation to s 178 it is unnecessary, for the purpose of enlivening the court’s jurisdiction, to find that the trustee has done anything wrong. His decision may, on the material before him, have been quite correct and reasonable: Gray v Clout (1990) 27 FCR 141 at 144 (Pincus J). On the other hand, it is not to the point that the judge who hears a review application might have acted differently: Healey v Prentice (No 2) [2000] FCA 1598 (Madgwick J). It is not necessary here to discern the outer limits of s 178 but rather to emphasise its importance in providing for wide ranging supervision by the Court of trustees who are appointed to administer the interests of bankrupts in the interests of creditors and, in so doing, to have regard also to the interests of the bankrupts: Haskins v Insolvency and Trustee Service Australia (unreported, Federal Court, Full Court, No V6 194, V6 238 and V6 400 of 1996, 3 October 1996).In Re Tyndall, Ex parte Official Receiver (1977) 17 ALR 182 (Re Tyndall), Deane J discussed the application of s 178 to a case involving the review of a trustee in bankruptcy’s decision to refuse to consent to a bankrupt travelling overseas. In that case, his Honour rejected the contention that the Court should only interfere with the trustee’s decision if it appeared that the trustee had acted absurdly, unreasonably or in bad faith. His Honour said that, once the matter is properly before the Court, s 178 not only empowers but obliges the Court to make an order in the matter as it thinks just and equitable: see at 186.
His Honour reasoned that a decision by a trustee in bankruptcy on an application by a bankrupt for permission to travel overseas is not one within the category of decision that should be treated as concerning the ordinary, day-to-day administration of a bankrupt estate. His Honour said (at 187):
… Even though applications for such leave are not uncommon, they must always be treated as being of fundamental importance, requiring careful consideration of all relevant circumstances for the reason that they are ordinarily related to the freedom of a subject, who is neither a criminal nor under criminal restraint, to travel to pursue his legitimate commercial or personal desires.
In the same vein, his Honour said (at 190-191):
... It is only in recent years that the Commonwealth bankruptcy legislation has made it an offence for a bankrupt to travel overseas without the consent of his trustee and has required a bankrupt to surrender his passport to his trustee once a sequestration order is made. Bankruptcy does not, of itself, involve any criminal offence. A citizen should be free to travel if and when his commercial activities or personal desires prompt him so to do. Restrictions upon such travel under the bankruptcy legislation must be seen as being aimed at insuring the proper administration of the bankruptcy laws and of bankrupt estates under such laws and not as a penalty imposed upon a citizen as a consequence of inability to pay debts leading to the making of a sequestration order.
These statements of principle were approved by Bowen CJ in Weiss v Official Trusteein Bankruptcy (1983) 1 FCR 40 (Weiss).
In Re Hicks; Ex parte Lamb (1994) 217 ALR 195; [1994] FCA 1473 (Re Hicks), having considered Re Tyndall and Weiss, Heerey J suggested (at 198) that, in a case such as the present, the following three matters might be at the forefront of the Court’s consideration:
·Is the proposed visit genuine?
·Is the bankrupt likely to return to Australia as promised?
·Will the visit hamper the administration of the estate?
In the present case, the applicant advanced submissions based on this framework. The respondents did not suggest that this framework was inappropriate, although they argued that my consideration was not limited to a consideration of these matters.
SUBMISSIONS
The applicant’s submissions
The applicant submitted that the proposed visit was genuine and that there was no evidence to the contrary. She also submitted that the bankrupt had strong ties to Australia, based on the matters I have summarised at [15]-[17] above, and that the bankrupt’s history of travel, as summarised at [19]-[23] above, was a strong factor in favour of the conclusion that the bankrupt was likely to return to Australia as he has promised. Finally, the applicant submitted that the bankrupt’s proposed visit would not impose any impediment to the respondents’ ongoing investigation into the bankrupt’s affairs. The applicant drew attention to the fact that the bankrupt had attended two public examinations and that, presently, there has been no request for him to attend for further examination.
The applicant also made submissions concerning the income contribution assessments that have been made. She pointed to the fact that s 272(2) of the Act provides that a trustee may impose a condition regarding the payment of income contribution as a condition of consent. Based on observations made by Riley FM in Lockwood v Vince [2007] FMCA 1497, she argued that the manner in which s 272(2) was couched did not mean that, as a general rule, such a condition should be imposed. Whether it would be appropriate for such a condition to be imposed is a matter to be determined in light of all the circumstances of the case. Here, the applicant referred to the bankrupt’s intention to seek a review of the respondents’ assessment of his liability to pay an income contribution. More importantly, she pointed to the fact that the bankrupt had given evidence that he does not have funds to pay the assessed contribution. Therefore, she argued, nothing was to be gained by, in effect, prohibiting the bankrupt from travelling as proposed.
The respondents’ submissions
In their written submissions, the respondents accepted that the bankrupt and the applicant held genuine desires to travel to Bali. They nevertheless submitted that the request to travel was not a “genuine or legitimate request that should be capable of triggering the Court’s supervisory jurisdiction”. They argued that such a request, “although desirous and indulgent to the [bankrupt] and the [applicant], should not be regarded as valid”. To support their submission, the respondents referred to various cases where the request for travel was motivated by what the respondents seem to regard as more worthy reasons for travel than, simply, a desire to have a vacation. The respondents sought to trivialise the plans that the applicant is seeking to make and suggested that the reasons for travel were “underwhelming and not capable of demonstrating error on the [respondents’] part”.
As to the question of whether the bankrupt was likely to return to Australia if permitted to travel to Bali, the respondents submitted that the bankrupt’s conduct immediately prior to his bankruptcy and to date has demonstrated a degree of disregard for his duties and obligations, which significantly reduced the credibility or reliance the Court can place on his intention to return to Australia.
In support of this submission, the respondents pointed to the bankrupt’s overseas travel during and after the appointment of his controlling trustee and the appointment of the respondents as his trustees in bankruptcy, all without consent. The respondents also relied on what they described as the bankrupt’s initial lack of co-operation at the time of his bankruptcy; his delay in providing a statement of affairs, which they said was an offence under the Act; his failure to disclose his full after-tax income until during his public examination; and the bankrupt’s failure to pay the income contributions within the seven days’ time limit they had imposed as a condition of their consent to his travel, which they also sought to argue was an offence under the Act.
The respondents submitted that this “litany of contraventions” would cause the Court to have concern as to the reliance that could be placed on the bankrupt’s statement that, if permitted to travel to Bali, he would return. The respondents also argued that the seriousness of the breaches to which they referred might cause the Court to question the veracity of the bankrupt’s evidence and the weight that could be placed on it. I note that, while actively advancing this submission, the respondents did not seek to challenge, by cross-examination, any aspect of the matters to which the bankrupt had deposed.
The respondents drew attention, in particular, to evidence that the bankrupt had given about his access to funds in a foreign trust, including the amount of those funds. The respondents suggested that an inference was available that, in giving his evidence about the foreign trust, the bankrupt was being disingenuous and that I should accept that he had the capacity and contacts to influence the making of distributions from that trust. The respondents submitted that this was a critical factor for the Court to consider, especially in light of the bankrupt’s ability to satisfy the condition they had imposed concerning payment of the assessed income contributions. Once again, none of these matters were put to the bankrupt by way of
cross-examination.
With respect to the question whether the proposed travel would hamper the administration of the bankrupt’s estate, the respondents properly accepted that travel for such a short period would not hamper their investigations. Having expressed that acceptance, the respondents nevertheless repeated their submissions concerning the bankrupt’s likely return to Australia.
Relatedly, the respondents referred to their intention to examine the applicant. They submitted that there was no evidence before the Court of a date when the applicant was likely to return and that if the applicant were to continue her stay in Bali this would likely hamper the administration of the bankrupt estate. Two matters should be noted immediately. First, the applicant deposed that she would return to Australia with the bankrupt on 18 January 2017 because they had established their lives in Australia and that Australia was the primary residence of the bankrupt’s parents, his children and his grandchild. The applicant was not challenged on this evidence by cross-examination and I see no reason why I should not accept it. Secondly, there is no evidence before me that any summons has been issued to the applicant requiring her to attend for public examination.
As to the reasonableness of the condition, the respondents simply repeated the matters they had advanced on the question of whether the bankrupt was likely to return to Australia if permitted to travel to Bali.
CONSIDERATION
Whilst the respondents have the power to impose, as a condition of consent to travel, a condition regarding payment on income contributions, their purported determination under s 139ZG(1) in their letter to the bankrupt of 6 December 2016 that the contributions they had assessed on that day were “now due and payable” was contrary to the minimum period mandated by s 139ZI(3) and, in my view, plainly invalid. The respondent’s imposition of the condition that the bankrupt pay the assessed income contributions within seven days, as a condition of their consent to his travel to Bali, was based on the same erroneous determination under s 139ZG(1). If, in imposing this condition, the respondents were seeking to make a separate determination under s 139ZG(1), that separate determination was equally erroneous and invalid.
In my view, s 178 of the Act has been properly engaged and the present case is a proper case for the Court’s intervention. The framework provided in Re Hicks is a suitable and convenient one by which to consider the order that is just and equitable in the present case, although I would accept the respondents’ submission that the three issues identified in that case should not be regarded as limiting the Court’s decision-making.
In light of the evidence that has been adduced, and given the lack of challenge to both the applicant and the bankrupt, I have no reason to doubt that their stated intention to travel to Bali for the purpose of celebrating the applicant’s fiftieth birthday with family and friends is a genuine intention and not a subterfuge masking travel for some other purpose. I reject the respondents’ submission that such travel is of a character that it does not stand as a genuine or legitimate request. It seems to me that the respondents’ submission proceeds on a misreading of the case law by placing an unwarranted fetter on what Deane J described in Re Tyndall as the freedom to travel whenever a person’s commercial activities or personal desires prompt him or her to so: see at 190. I note that the respondents accept that the applicant and bankrupt hold genuine desires to travel to Bali.
As to the question of whether the bankrupt is likely to return to Australia as promised, I am satisfied that the risk of the bankrupt absconding is relatively slight. There are two principal reasons for this conclusion.
First, the bankrupt has substantial ties to Australia. He and the applicant have now lived in Australia for some significant time and their two children live and study in Australia. Further, the bankrupt’s elderly parents reside in Australia, as do the bankrupt’s eldest daughter and her young child, the bankrupt’s first grandchild.
Secondly, the bankrupt has relatively frequently, although not always legally, travelled to and from Australia in the circumstances I have described at [19]-[23] above. The fact that, on each occasion, he has returned to Australia, particularly since the making of the sequestration order, gives me some confidence that, if permitted to travel to Bali on this occasion, he will return to Australia. The fact that he has done so on previous occasions reinforces my conclusion that he has strong ties to Australia. Moreover, both the bankrupt and the applicant have deposed that they will return to Australia, if the bankrupt is permitted to travel. They were not challenged on this evidence and I have no particular reason to doubt the genuineness and sincerity of their statements in this regard, even though the respondents have sought to challenge the degree of comfort the Court can place on that evidence.
As to the question whether the proposed trip will hamper the administration of the bankrupt’s estate, I note that he has been examined and that there is no present plan that he be examined further, even though leave to approach the Registry for the bankrupt’s further examination has been granted. As I have noted, the respondents intend to examine the applicant, but as yet no summons has been issued.
Further, the bankrupt has deposed that he does not have the funds to pay, and is unable to procure funds from family and friends to pay, the assessed income contributions. Whilst I appreciate that the respondents are still investigating the bankrupt’s financial affairs, including his possible access to overseas funds, the present application is not the occasion for the Court to investigate those matters or, indeed, the bankrupt’s own claim that the assessed income contributions are excessive. I propose to move on the bankrupt’s evidence that he is not in a positon to pay the assessed income contributions. If this be so, then the imposition of a condition on his travel that he pay such contributions now would not assist in the proper administration of his estate and would simply be punitive in character.
CONCLUSION AND DISPOSITION
For these reasons, I am persuaded that the just and equitable order is that the respondents provide written consent to the bankrupt to enable his travel to Bali between 4 and 18 January 2017, and to provide the bankrupt with his passport for that purpose, without the imposition of the condition that he pay the assessed income contributions prior to such travel.
It is nevertheless appropriate that the Court require an undertaking from the bankrupt that, if the respondents provide him with his passport, he will use it only for the purposes of travel between Australia and Bali in the period of 4 to 18 January 2017 and that upon his return to Australia he will deliver his passport to the respondents by no later than 23 January 2017. The bankrupt personally proffered that undertaking at the hearing of this application.
The applicant has been successful on her application and I can see no reason why, in those circumstances, costs should not follow the event. Against the making of such an order, the respondents submitted that the applicant has not taken genuine steps to attempt to resolve the present dispute. I am not persuaded of that fact.
The bankrupt’s request to travel was made on 8 November 2016 and refused on 21 November 2016. As I have noted, this prompted the applicant, through her solicitors, to write to the respondents on 5 December 2016 seeking their reconsideration of the decision. At that time, the respondents were provided with the draft Application, the applicant’s affidavit made on 30 November 2016, and the bankrupt’s affidavit made on 1 December 2016. Also at that time, the applicant’s solicitors advised that, if an appropriate response from the respondents was not forthcoming, it would be necessary for the applicant to approach the Court urgently, given that the end of the Court’s sitting period was soon approaching. That circumstance justified an early approach to the Court to list the matter for hearing. Although in submissions the respondents said that they neither consented to nor opposed the orders sought by the applicant, they nevertheless effectively opposed the application by seeking to maintain, in particular, the condition that the bankrupt pay the assessed income contributions prior to his travel being permitted. Having adopted that course, and having been unsuccessful, the respondents should pay the applicant’s costs.
I certify that the preceding sixty-one (61) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Yates. Associate:
Dated: 21 December 2016
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