Re John, R. Hassard

NOT FOR DISTRIBUTION

355.

IN THE FEDERAL COURT OF AUSTRALIA 1

)

EXERCISING FEDERAL JURISDICTION	)	No. 125 of 1987
)
IN BANKRUPTCY	)

BANKRUPTCY DISTRICT

OF THE STATE OF VICTORIA

RE: JOHN R. HASSARD

A Bankrupt

m:	NORTHROP J.
m:	29 APRIL 1987

W: MELBOURNE

EX TEMPORE REASONS FOR

JUDGMENT

I propose to grant the application for

order

annulling the bankruptcy but,

in so doing, make the comment

that the matter has

been presented in a most unsatisfactory

manner by

the solicitor acting for the bankrupt. In the

first

place,

there

was

no affidavit

support

of the

appllcation under paragraph 154(l)(b) of the Bankruptcy Act

1966 a6 is requlred by rule

103 of the Bankruptcy Rules and

there was no evidence at all that the debts of the bankrupt

have been

paid

full.

Under

normal

circumstances

application like this, on

comlng before the Court, would be

dismissed. I make

no comment on whether the bankrupt W-

have any cause

of action based on negligence of hls

. I

for any damages resultlng from the dismissal

application. In the circumstances,

I am prepared to

eacept T-J .i

- 2 -

the report of the Offlclal Trustee as discloslng the material

upon whlch the application is based but even here the report

draws attention to two particular matters; one, that a debt

owing as at the date of bankruptcy was not disclosed by the

bankrupt being a debt

in the sum

of $2,567 owing to A.C.I.

Australia Limited trading as Stegbar.

The report goes on and

says :

"I understand that evidence

that the debt has been

settled will be produced at the hearing."

Further, the report contains

a paragraph as follows:-

"The conduct of the bankrupt since date

bankruptcy has not been entirely satisfactory. He should explaln to the Court why he omitted to disclose in his Statement of Affairs a provable

debt of $2,567.

Desplte those two very clear references

to matters

contained in the

report of the

Official

Trustee,

the

solicitor for the bankrupt did not ensure

that his client be

present in Court to give evidence on those two matters.

The

solicitor himself gave evidence that actlng on advice given

to him, Mr. Hassard paid that debt to the solicitors for the

creditor and produced a

letter

dated 21 April 1987 from a

firm of solicitors addressed to the solicltor for the debtor

reading as follows:-

"Stegbar v.

J . R .

Hassard

We have been requested	by	Mr. Hassard to forward
the receipt to you.

- 3 -

There was enclosed a

receipt whlch appears

to be a

receipt

initlally drawn In the name of Wlsewoulds, presumably a firm

of sollcitors well known

in the city of Melbourne. In one

spot that name appears to have been partially blacked out

wlth the name of the solicltor for the creditor written over

it, but in the other place the blacking out does not affect the Wisewoulds' name whatsoever. The receipt is in the form: -

"Received by cheque from J.R. Hassard re Stegbar the

sum of $2,567 and subject to clearance."

The receipt is dated 16 April 1987.

There is also before the Court, an affidavit sworn

on 2 April 1987 by the solicitor for the bankrupt containing materlal to the effect that the bankrupt has entered Into a

contract of sale

for

the

purchase

of a property at

Strathmore.

The matter cannot go ahead while the bankruptcy

is in existence because of the need of the bankrupt to borrow

money and that interest at a higher rate

is liable to be paid

as is also the

possibility of

the deposit being forfeited.

The affidavit was filed in support of an application to have

the return date

of the application brought forward from 12

May 1987, which was the initlal date for the hearing of	the
application.

I mention all these matters

to illustrate the

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completely unsatlsfactory standard

of the presentatlon of

thls case, but in

the clrcumstances I am prepared to grant

the

application

and

havlng

regard to the report of the

Official Trustee, which I am entitled to look at under

rule

57(3) of the Bankruptcy Rules, I will make the order sought.

The order is that the bankruptcy be annulled.

CaseChat Overview and Summary

In this case, the applicant, John R. Hassard, sought an order to annul his bankruptcy. The application was brought before the Federal Court of Australia in the Bankruptcy District of the State of Victoria. The central issue in this matter was whether the bankruptcy of Mr. Hassard should be annulled. The court needed to consider the adequacy of the application's presentation, the evidence provided, and whether the debts of the bankrupt had been paid in full.

The court found the presentation of the application to be unsatisfactory, primarily due to the absence of an affidavit in support of the application as required by the Bankruptcy Act 1966 and the Bankruptcy Rules. Furthermore, there was no evidence that the bankrupt's debts had been paid in full. Despite these shortcomings, the court decided to grant the application for annulment based on the report of the Official Trustee. The report indicated that the bankrupt had settled a debt of $2,567 that was not initially disclosed. Additionally, the Official Trustee's report highlighted concerns about the bankrupt's conduct since the date of bankruptcy, including the omission of a provable debt. Although the bankrupt's solicitor had evidence of the settlement, the court accepted the report and decided to annul the bankruptcy.

Given the circumstances and the evidence presented, the court ruled in favour of annulling the bankruptcy of John R. Hassard. The order was made despite the unsatisfactory presentation of the application, reflecting the court's discretion in exceptional cases. The annulment of the bankruptcy was thus granted, allowing Mr. Hassard to proceed with his planned property purchase without the hindrance of his bankruptcy status.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established