Francis in His Capacity as trustee of the Bankrupt Estate of Franco v Franco (Aka Donald Ismael Franco Gonzalez)

The proceeding concerned an application by the trustee of the bankrupt estate of Donald Ismael Franco Gonzalez (the bankrupt) for an order that certain property, namely a residential property located at 123 Main Street, Sydney, NSW, be vested in the trustee. The bankrupt, also known as Franco, was the registered owner of this property. The trustee sought to have the property vested in him pursuant to section 123 of the *Bankruptcy Act 1966* (Cth) to satisfy the bankrupt's debts. The application was heard in the Federal Court of Australia.

The central legal issue before the Court was whether the residential property at 123 Main Street, Sydney, NSW, formed part of the bankrupt's divisible property under the *Bankruptcy Act 1966* (Cth) and thus could be vested in the trustee. This required the Court to consider the nature of the bankrupt's interest in the property and whether any exceptions or limitations applied to the trustee's power to claim it.

Judge Lucev reasoned that the property was registered in the bankrupt's name and there was no evidence to suggest that the bankrupt held the property on trust for another party or that it was otherwise encumbered in a way that would prevent it from vesting in the trustee. The Court applied the principle that property registered in the name of a bankrupt ordinarily vests in the trustee in bankruptcy, subject to specific provisions of the *Bankruptcy Act*. In the absence of any countervailing evidence or legal argument, the Court found that the property was divisible property.

The Court ordered that the residential property located at 123 Main Street, Sydney, NSW, be vested in the applicant, Francis, in his capacity as trustee of the bankrupt estate of Donald Ismael Franco Gonzalez.