Lucan as Trustee of the Bankrupt Estate of Tomic v Tomic

This matter came before Cameron J in the Federal Court of Australia. The applicant, Mr Lucan, as trustee of the bankrupt estate of George Tomic, sought orders for vacant possession of a property co-owned by the bankrupt and the first respondent, Ms Vesna Tomic, and for the sale of that property. The bankrupt himself was initially cited as a respondent but was later removed from the proceedings, with the court noting he had likely never been a formal party.

The central legal issue before the court was whether the trustee was entitled to an order for vacant possession of the jointly owned property and for its sale, in order to realise the bankrupt's interest for the benefit of his creditors. This involved considering the trustee's powers and obligations in administering a bankrupt's estate, particularly concerning jointly owned assets, and the rights of a co-owner.

Cameron J reasoned that upon the sequestration order, the bankrupt's interest in the property vested in the trustee. The trustee's duty is to administer the estate and realise its assets for the benefit of creditors. The court found that the trustee had made reasonable attempts to negotiate a resolution with Ms Tomic, including offering her the opportunity to purchase the bankrupt's interest or agreeing to a sale of the entire property. Despite these efforts, no satisfactory arrangement had been made. The court applied the principle that a trustee in bankruptcy has the power to sell the bankrupt's interest in jointly owned property, and where necessary, to seek orders for possession and sale to facilitate this realisation.

The court ordered that the applicant have vacant possession of the property and that the property be sold.