Official Receiver v Whent

The Federal Magistrates Court was presented with an interim application for the Official Receiver to be excused from serving a substantive application under s.146 of the Bankruptcy Act 1966 (Cth) for the distribution of funds in the bankrupt estate of the respondent, Sharon Natalie Whent. The substantive application sought an order for the distribution of dividends among creditors who had proved their debts as if the respondent had filed a statement of affairs, despite her failure to do so. The Court was also required to decide whether it should exercise its discretion to dispense with the requirement to serve the respondent with the applications, pursuant to the Federal Magistrates Court Rules 2001 (Cth). The evidence demonstrated that the respondent had failed to file a Statement of Affairs within 14 days of being notified of her bankruptcy, and had failed to advise the trustee of a change of address. Despite this, the Official Receiver had made no attempt to serve the respondent with the applications. The Court found that the Official Receiver had not taken any reasonable steps to effect service on the respondent, and there was no explanation as to why this was so. The Court was not satisfied that it should exercise its discretion to dispense with service on the respondent. It was not appropriate to adjourn the interim application to allow the Official Receiver to attempt to serve the respondent. The interim application was dismissed, and the substantive application was adjourned for the Official Receiver to endeavour to personally serve the respondent.