BANKRUPTCY.
No. 3 of 1927.
An Act to amend the Bankruptcy Act 1924.
[Assented to 8th April, 1927.]
BE it enacted by the King’s Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia, as follows:—
Short title and citation.
1.—(1.) This Act may be cited as the Bankruptcy Act 1927.
(2.) The Bankruptcy Act 1924 is in this Act referred to as the Principal Act.
(3.) The Principal Act, as amended by this Act, may be cited as the Bankruptcy Act 1924-1927.
Commencement.
2. This Act shall commence on the same date as the Principal Act.
District Registrars and Official Receivers.
3. Section twelve of the Principal Act is amended by inserting, after sub-section (4.), the following sub-section:—
“(4a.) Every official receiver who is remunerated by fees and commission only shall, upon his appointment, give security to the satisfaction of the Attorney-General in such sum and in such form as the Attorney-General determines.”.
Extent of jurisdiction of Court.
4. Section twenty of the Principal Act is amended by adding at the end thereof the following sub-section:—
“(4.) Every order decision or award of the Court made under this Act in any cause or matter may be enforced by the Court against all persons bound thereby in the same manner as a judgment of the High Court may be enforced by the High Court.”.
Jurisdiction in chambers
5. Section twenty-one of the Principal Act is amended by inserting before paragraph (a) the following paragraph:—
“(aa) Creditors’ petitions under this Act;”.
6. After section fifty-three of the Principal Act the following section is inserted in Division 1 of Part IV.:—
Acts of bankruptcy committed before commencement of Act.
“53a. Where, before the commencement of this Act, any act or thing is done or omitted to be done, whereby a creditor would but for this Act be entitled under any State Bankruptcy or Insolvency Act to present a petition against a debtor, and no proceedings have been taken, under any such State Act, against the debtor, the doing or omitting to do any such act or thing shall, for the purposes of this Act, be deemed to be an act of bankruptcy committed by the debtor.”.
Power to appoint special manager.
7. Section sixty-four of the Principal Act is amended by omitting from sub-section (3.) the words “is prescribed” and inserting in their stead the words “the official receiver fixes from time to time subject to the approval of the Court or the Registrar”.
Priorities.
8. Section eighty-four of the Principal Act is amended—
(a) by omitting from sub-section (1.) all words to the end of paragraph (c) and inserting in their stead the following words:—
“(1.) Subject to the provisions of this Act, the trustee shall apply the estate of the bankrupt in the following order of priority:—
(a) Firstly, in payment of the costs of administration in…
Overview
The Bankruptcy Act 1927 was enacted to amend the Bankruptcy Act 1924. This Act was introduced to address several issues and gaps within the existing framework of bankruptcy law. The Bankruptcy Act 1927 was enacted by the King's Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia, and its primary objective is to refine and update the legal processes associated with bankruptcy. This includes adjustments to the roles of District Registrars and Official Receivers, the extent of the Court's jurisdiction, and the enforcement of Court orders. Additionally, the Act seeks to clarify the circumstances under which certain actions can be deemed acts of bankruptcy and to establish the procedures for the appointment of special managers. The policy objective is to ensure that the bankruptcy process is fair, efficient, and aligned with contemporary legal standards.
Scope and Application
The Bankruptcy Act 1927, as amended, applies to individuals and entities involved in insolvency proceedings within the Commonwealth of Australia. The Act pertains to individuals and entities deemed bankrupt, their creditors, trustees, and other parties involved in the administration of bankruptcy proceedings. It governs the conduct and transactions of these parties, including the enforcement of orders and decisions made under the Act. The geographic and jurisdictional reach of the Act is national, applying uniformly across Australia. There are no specific exclusions or exemptions mentioned in the text, although the Act may be subject to interpretation and application through subordinate instruments or regulations. The Act extends its application to include acts committed prior to its commencement and protects electrical apparatus from bankruptcy proceedings when in the possession of third parties. The Act also sets out provisions for the remuneration of trustees and the discharge of bankrupts.
Key Provisions
- The Bankruptcy Act 1927 (Act) makes several significant amendments to the Bankruptcy Act 1924 (Principal Act). Firstly, it introduces new requirements for official receivers. According to section 3(4a), every official receiver remunerated by fees and commission must provide security to the satisfaction of the Attorney-General upon appointment, with the sum and form determined by the Attorney-General. This amendment ensures that official receivers are held accountable and provide an additional layer of security for the creditors.
- The Act also expands the jurisdiction of the Court under section 4(4), allowing any order, decision, or award made by the Court to be enforced in the same manner as a High Court judgment. This provision ensures that the Court’s decisions carry significant weight and can be effectively enforced.
- Furthermore, section 5(aa) adds creditors’ petitions to the list of matters within the Court’s jurisdiction in chambers, thereby enabling the Court to handle such petitions more efficiently. Section 53a addresses acts of bankruptcy committed before the Act’s commencement, deeming them as acts of bankruptcy for the purposes of the Act if no State proceedings have been initiated.
- The Act imposes several obligations on parties and entities it governs. For example, section 7 amends the remuneration of the official receiver, allowing the official receiver to fix remuneration subject to the approval of the Court or the Registrar. This change provides flexibility in setting remuneration while maintaining oversight.
- Additionally, section 8(1) modifies the priority order in which the trustee must apply the estate of the bankrupt, ensuring that costs of administration and trustee remuneration are paid first. This amendment helps in safeguarding the interests of the creditors by ensuring that administrative and trustee expenses are covered promptly.
- The Act also outlines several offences, penalties, and consequences for breach. For instance, section 19 imposes penalties for failure to make full discovery, although the specific penalties are not detailed in the provided text. Generally, such breaches may lead to legal repercussions, including fines or other penalties as determined by the Court.
- In summary, the Bankruptcy Act 1927 introduces various amendments to the Principal Act, focusing on the roles and responsibilities of official receivers, the enforcement of Court orders, and the priority of payments from the bankrupt’s estate. It also imposes specific obligations on parties and entities and outlines potential consequences for non-compliance.
- Area of Law
- Insolvency Law
- Instrument
- Act
- Concepts
- Commencement Provisions
- Regulatory Standards
- Reporting & Disclosure Obligations
