Peled v Roufeil

In *Peled v Roufeil*, the applicant, a bankrupt, challenged an assessment made by the respondent trustee under section 139Y of the *Bankruptcy Act 1966* (Cth). The trustee had determined that the bankrupt had received less than reasonable remuneration for work performed during a contribution assessment period, and therefore assessed a notional income for the purpose of bankruptcy contributions. The applicant did not dispute that he had been working, but contested the trustee's valuation of that work.

The central legal issue before the court was whether the trustee had correctly applied section 139Y of the *Bankruptcy Act 1966* (Cth) in deeming the bankrupt to have received reasonable remuneration for his work. Specifically, the court had to determine if the conditions of section 139Y(1)(a) and (b)(ii) were met, requiring an assessment of whether the remuneration received was less than what might reasonably be expected for similar work performed in an arm's-length transaction.

Judge Altobelli found the evidence of the respondent trustee to be credible and reliable. While accepting the evidence of the applicant's wife as truthful, the court noted that her testimony did not appear to be entirely complete or conclusive, leaving a "lingering impression" that she possessed further relevant information. The court also expressed surprise at the apparent lack of involvement of the applicant's wife in the business affairs of a company of which she became the sole director after the applicant's bankruptcy, particularly during the contribution assessment period. The court's findings regarding the credibility of the witnesses and the overall evidence informed its consideration of the reasonableness of the trustee's assessment.