Neffati and Inspector-General in Bankruptcy

This matter concerned an application for review before the Administrative Appeals Tribunal (AAT) by Mr. Neffati against a decision of the Inspector-General in Bankruptcy. The dispute centred on the scope of the Tribunal's power when reviewing a decision by the Inspector-General not to conduct a review of a trustee's objection to a bankrupt's discharge. The core question was whether the AAT, in reviewing the Inspector-General's refusal to conduct a review, could itself conduct the substantive review of the trustee's objection.

The legal issues before the Tribunal were whether it possessed the jurisdiction to review the trustee's decision to object to discharge, or if its power was limited to reviewing only the Inspector-General's decision to refuse to conduct such a review. Specifically, the Tribunal had to determine if, under section 43(1) of the Administrative Appeals Tribunal Act 1975, it could exercise all the powers and discretions of the original decision-maker, including the power to initiate a review that the Inspector-General had declined to undertake.

The Tribunal reasoned that while it could substitute its own decision for that of the Inspector-General, its power was confined to reviewing the decision that was actually made. In this instance, the Inspector-General had decided *not* to conduct a review, and it was this decision that was before the Tribunal. The Tribunal acknowledged that the Inspector-General had the discretion to decide whether sufficient reasons existed to justify conducting a review under section 149K(1) of the Bankruptcy Act 1966. However, the Tribunal concluded that the fact the Inspector-General *could* have conducted a review did not confer upon the Tribunal the power to conduct that review itself. The Tribunal's role was to review the Inspector-General's decision to refuse a review, not to step into the shoes of the Inspector-General and conduct the initial review of the trustee's objection.

The Tribunal answered the preliminary question in the negative. It held that it had jurisdiction to review the Inspector-General's decision not to conduct a review, but it did not have jurisdiction to conduct the substantive review of the trustee's objection to discharge.