Re Lilburn, H.S. v Ex parte Lilburn, H.S Summary

IN THE FEDERAL COURT OF AUSTRALIA
No VB 3384 of 1995
EXERCISING FEDERAL JURISDICTION No VB 3385 of 1995
IN BANKRUPTCY

BANKRUPTCY DISTRICT OF THE STATE OF VICTORIA

RE: HERBERT STEPHEN LILBURN

EX PARTE: HERBERT STEPHEN LILBURN

RE: LOIS ELIZABETH LILBURN

EX PARTE: LOIS ELIZABETH LILBURN

COURT: FINN J

PLACE: MELBOURNE

DATE: 26 JULY 1995

REASONS FOR JUDGMENT

I have before me two applications, the one by Herbert Stephen Lilburn, the other by Lois Elizabeth Lilburn, seeking orders under section 153B of the Bankruptcy Act 1966. The applications are presented on the ground that the sequestration orders made against the Lilburns ought not to have been made and that consequently this Court should make an orders annulling the respective bankruptcies. It is, however, the case and it is agreed by the Lilburns, that their bankruptcies have been annulled by force of section 153A(1) of the Bankruptcy Act.

The Official Trustee has certified in each instance, pursuant to that section, "that all the bankrupt's debts have been paid in full". In consequence the statute by its own force effects an annulment. In this state of affairs there is no bankruptcy in existence in respect of which this Court is
capable of making an order of annulment. Because there is no such bankruptcy in existence the application must be dismissed. It may well be the case that the particular situation in which the two applicants find themselves is not one to which Parliament has addressed its attention. In cases such as this there may well be reasons why a person may wish not merely to have their bankruptcy annulled on the ground that his or her debts have been paid in full, but annulled on the ground that in all the circumstances, a sequestration order should never have been made.

Whether such an order should have been made in the present case is not a matter into which I can or should enquire. Here I merely note that under our present legislation, if an annulment occurs under section 153A, the person so affected is thereby precluded from seeking an alternative annulment or a variation of the first annulment if I could so describe it, under section 153B. Having made that observation about the legislation, it simply remains for me to dismiss the two applications brought by the Lilburns, and I will make formal orders to that effect.

In the matter re Herbert Stephen Lilburn ex parte Herbert Stephen Lilburn, I dismiss the application for annulment of bankruptcy brought under section 153B of the Bankruptcy Act. In the matter re Lois Elizabeth Lilburn ex parte Lois Elizabeth Lilburn, I dismiss the application made under section 153B for annulment.

I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment of The Honourable Justice Finn.

Associate:

Date:

ATTACHMENT

Herbert Stephen Lilburn appeared for the former bankrupts

Mr E.J. Marsh appeared for the former Trustee in Bankruptcy of each estate

Date of Hearing: 26 July 1995

Herbert Stephen Lilburn and Lois Elizabeth Lilburn, both former bankrupts, brought separate applications to the Federal Court of Australia for orders under section 153B of the Bankruptcy Act 1966. The applicants sought to have their respective sequestration orders annulled on the basis that they should never have been made. The Official Trustee had already certified under section 153A(1) of the Bankruptcy Act that all the Lilburns' debts had been paid in full, which had led to the annulment of their bankruptcies by operation of law. The court had to decide whether, despite the statutory annulment, the Lilburns could still seek further relief under section 153B.

Justice Finn held that the statutory annulment under section 153A(1) precluded the Lilburns from seeking further annulment or variation of that annulment under section 153B. The court observed that the current legislation does not provide for situations where a sequestration order should not have been made, even if the debts have been paid in full. The applicants' circumstances, though possibly deserving of attention, did not fall within the scope of the legislation as it stood. Consequently, the court dismissed the applications on the basis that there was no existing bankruptcy for which an order could be made.

The court made formal orders dismissing the applications brought by Herbert Stephen Lilburn and Lois Elizabeth Lilburn under section 153B of the Bankruptcy Act. The reasoning was that the statutory annulment of their bankruptcies had already occurred, and further relief was not available to them under the existing legal framework. This decision underscored the limitations of the Bankruptcy Act in addressing specific situations where sequestration orders may have been wrongly made.

Re Lilburn, H.S. v Ex parte Lilburn, H.S

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