Barnden as trustee of the Bankrupt Estate of Edwards v Edwards

[2017] FCCA 175

FEDERAL CIRCUIT COURT OF AUSTRALIA

BARNDEN AS TRUSTEE OF THE BANKRUPT ESTATE OF EDWARDS v EDWARDS [2017] FCCA 175

Catchwords:
BANKRUPTCY – Where the bankrupt has not filed a statement of affairs – failure of appearance by the bankrupt – hearing proceeded in absence of bankrupt – where the trustee has taken appropriate steps – application for interim distribution allowed.

Legislation:

Bankruptcy Act 1966, ss.27, 146.

Federal Circuit Court Rules 2001 (Cth) s.13.03C(1)(e).

Cases cited:

Roufeil (Trustee), in the matter of Jarvie (Bankrupt) [2015] FCA 232

Applicant: ANDREW JAMES BARNDEN AS TRUSTEE OF THE BANKRUPT ESTATE OF MARK CHRISTOPHER EDWARDS

Respondent: MARK CHRISTOPHER EDWARDS

File Number: SYG 3363 of 2016

Judgment of: Judge Street

Hearing date: 2 February 2017

Date of Last Submission: 2 February 2017

Delivered at: Sydney

Delivered on: 2 February 2017

REPRESENTATION

Solicitors for the Applicant: Mr R Roser
Moisson Lawyers

No appearance by or on behalf of the Respondent.

ORDERS

1. Pursuant to section 146 of the Bankruptcy Act 1966, the applicant, as trustee of the Bankrupt Estate of Mark Christopher Edwards, distribute interim dividends amongst the creditors of the respondent who have proved their debts in accordance with Division 5 of the Bankruptcy Act 1966 as if the bankrupt had filed a statement of his affairs and those creditors had been stated to be creditors in it.

2. Dispense with the need for to Trustee to give further notice to the creditors of the interim distribution.

3. Costs of this application be costs of the bankrupt estate and to be paid from the bankrupt estate.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 3363 of 2016

ANDREW JAMES BARNDEN AS TRUSTEE OF THE BANKRUPT ESTATE OF MARK CHRISTOPHER EDWARDS

Applicant

And

MARK (CHRISTOPHER) EDWARDS

Respondent

REASONS FOR JUDGMENT

1. This is an application within the Court’s jurisdiction under s.27 of the Bankruptcy Act 1966 (Cth) (“the Act”) for an order under s.146 of the Act.

2. The bankrupt was the subject of a sequestration order made on 6 August 2015 and has not, to date, filed a statement of affairs. The trustee moves for an order for an interim distribution of dividends notwithstanding the failure of the bankrupt to file a statement of affairs.

3. The trustee has read evidence in respect of service on the bankrupt of requests for the statement of affairs as well as notice of these proceedings.

4. The bankrupt has failed to appear. I am satisfied that the bankrupt was aware of these proceedings and that this is an appropriate matter in which the Court should exercise its powers under s.13.03C(1)(e) of the Federal Circuit Court Rules 2001 (Cth) and proceed with the hearing of the application under s.146 of the Act.

5. One of the obligations imposed by the Act on the trustee is to proceed with all convenient speed to declare and distribute dividends amongst creditors who have proved their debts. The power conferred by s.146 is a power to facilitate the continuation of the administration of the estate by a trustee notwithstanding the failure of the bankrupt to comply with his statutory obligations in respect of the filing of the statement of affairs.

6. Evidence has been adduced in relation to the acquiring of funds from a sale of certain property and in relation to the identification of creditors that the trustee has been able to ascertain including from the advertising that has taken place to date, and other steps.

7. I am satisfied that the trustee has taken appropriate steps to try and obtain the statement of affairs from the bankrupt. I am satisfied that the trustee has taken appropriate steps to try and identify the creditors of the bankrupt. I am satisfied that this is an appropriate matter in which the Court should exercise its powers under s.146 for the benefit of the creditors of the estate.

8. I have taken into account the applicant’s submissions and in particular the observations made by the learned Gleeson J in Roufeil (Trustee), in the matter of Jarvie (Bankrupt) [2015] FCA 232. The bankrupt has not filed the statement of affairs as required. The circumstances of the present case are ones where the Court should exercise its discretion to order an interim distribution of dividends amongst the creditors that have provided proofs of debt.

I certify that the preceding eight (8) paragraphs are a true copy of the reasons for judgment of Judge Street

Date: 7 February 2017