Commonwealth Bank of Australia Trading as BankWest v Mastronardo

Commonwealth Bank of Australia trading as BankWest (the applicant creditor) sought a sequestration order against Carmelo Adriano Mastronardo (the respondent) based on an alleged act of bankruptcy arising from the respondent's failure to comply with a bankruptcy notice. The respondent contended that he possessed an offsetting claim that equalled or exceeded the debt relied upon by the creditor, and also raised a defence of unconscionable conduct by the creditor in relation to an existing loan facility.

The court was required to determine whether the conditions for making a sequestration order were satisfied, specifically whether the respondent had an arguable case for an offsetting claim that would defeat the creditor's petition, and whether the creditor's conduct in offering additional loan amounts under an existing facility could be considered unconscionable.

Judge Manousaridis found that there was no reasonably arguable case of an offsetting claim that was equal to or in excess of the debt. Furthermore, the court determined that it was not reasonably arguable that the creditor had engaged in unconscionable conduct by offering to lend additional amounts under the existing facility on particular terms. Consequently, the court dismissed the application to adjourn the creditor's petition.

The court ordered that the estate of the respondent be sequestrated under the *Bankruptcy Act 1966* (Cth), with the applicant creditor's costs to be taxed and paid from the respondent's estate. The date of the act of bankruptcy was noted as 15 October 2019.