Juratowitch (as trustee for the Bankrupt Estate of Saad Al Bagdady (Also Known as Sami Sabri)) v Baghdady (Also Known as Sami Sabri) (A Bankrupt)

The proceeding concerned an application by the trustee of the bankrupt estate of Sami Sabri (also known as Saad Al Bagdady) for an order that Mr Sabri's former wife, Ms Baghdady, pay to the trustee a sum of money representing the value of certain assets that had been transferred to her. The trustee sought to recover these assets as voidable transactions under section 120 of the *Bankruptcy Act 1966* (Cth) (the Act). The application was heard in the Federal Court of Australia by Dowdy J.

The central legal issue before the Court was whether the transfers of assets from Mr Sabri to Ms Baghdady, which occurred within five years prior to Mr Sabri's bankruptcy, were voidable by the trustee. Specifically, the Court had to determine if these transfers were made for "less than market value" and if Mr Sabri was insolvent at the time of the transfers or became insolvent as a result of them, as required by section 120(1) of the Act.

Dowdy J reasoned that the onus was on the trustee to establish the conditions for voidability under section 120(1). The Court considered the evidence presented regarding the nature of the transfers and the financial position of Mr Sabri at the relevant times. The legal principle applied was that a transfer for less than market value is voidable if the transferor is insolvent at the time of the transfer or becomes insolvent as a consequence of the transfer. The Court found that the trustee had not discharged this onus, as the evidence did not sufficiently establish that the transfers were made for less than market value or that Mr Sabri was insolvent at the time of the transfers.

Consequently, the Court dismissed the trustee's application.