Nelson (as trustee) v Supple

The proceeding involved the trustee in bankruptcy, Mr. Nelson, as the applicant, and Mr. Supple and another respondent, as the respondents. The dispute concerned the validity of a transfer of property from the bankrupt to Mr. Supple. The matter was heard in the Federal Court of Australia.

The court was required to determine whether the transfer of property was voidable under section 121 of the *Bankruptcy Act 1966* (Cth). Specifically, the court had to consider whether Mr. Supple provided consideration that was at least as valuable as the market value of the property, and whether Mr. Supple neither knew nor could reasonably have inferred that the transferor's main purpose was to prevent the property from becoming divisible amongst her creditors or to hinder or delay its availability to creditors. Additionally, the court had to assess whether Mr. Supple neither knew nor could reasonably have inferred that the transferor was, or was about to become, insolvent at the time of the transfer.

Judge Burchardt found that Mr. Supple did not know, and could not reasonably have inferred, that the transferor's main purpose was to defeat or delay creditors. Furthermore, the court determined that Mr. Supple did not know, and could not reasonably have inferred, that the transferor was insolvent or about to become insolvent at the time of the transfer. The court also considered that the property would not have become part of the transferor's estate and available to creditors even if the transfer had not occurred, and that the transferor's purpose was not to prevent the property from becoming divisible amongst her creditors.

The application by the trustee was dismissed.