Unicomb v Official Trustee in Bankruptcy - [2000] FCA 457

FEDERAL COURT OF AUSTRALIA
Unicomb v Official Trustee in Bankruptcy
[2000] FCA 457
BANKRUPTCY - property of the bankrupt - whether shares that were to be allotted to the applicant through the demutualisation and reconstruction of Australian Mutual Provident Society vested in the Official Trustee in Bankruptcy - consideration of when those shares became “property”.
Bankruptcy Act 1966 (Cth) ss 58, 116
Australian Mutual Provident Society (Demutualisation and Reconstruction) Act 1997 (NSW)
Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306 Dist
Federal Commissioner of Taxation v St Helens Farm (ACT) Pty Ltd (1981) 146 CLR 336 Appl
VGM Holdings Ltd [1942] 1 Ch 235 (CA) Appr
Re R G Capital Radio Pty Ltd (formerly Sea FM Pty Ltd) (1998) 26 ACSR 622 Cited
National Westminster Bank P/L v Inland Revenue Commissioner [1995] 1 AC 119 Cited
PETER ASHLEY UNICOMB v OFFICIAL TRUSTEE IN BANKRUPTCY
Q7069 OF 1999
COOPER J
BRISBANE
11 APRIL 2000

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

Q 7069 OF 1999

IN THE MATTER OF:

PETER ASHLEY UNICOMB
APPLICANT

AND:

OFFICIAL TRUSTEE IN BANKRUPTCY
RESPONDENT

JUDGE:

COOPER J

DATE OF ORDER:

11 APRIL 2000

WHERE MADE:

BRISBANE

THE COURT DECLARES THAT:
1.On 1 January 1998 the applicant became beneficially entitled to an allocation of 2,352 shares in AMP Limited.

THE COURT ORDERS THAT :

1.The Official Trustee in Bankruptcy pay to the applicant the proceeds from the sale of the 2,352 AMP Limited shares, together with interest of 10.5 per cent per annum from and including 23 February 1999 until and including Tuesday 11 April 2000.
2.The respondent pay the applicant’s costs of and incidental to the application including reserved costs, if any, to be taxed if not agreed.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

Q 7069 OF 1999

IN THE MATTER OF:

PETER ASHLEY UNICOMB
APPLICANT

AND:

OFFICIAL TRUSTEE IN BANKRUPTCY
RESPONDENT

JUDGE:

COOPER J

DATE:

11 APRIL 2000

PLACE:

BRISBANE

REASONS FOR JUDGMENT
Background

The applicant was declared bankrupt on 2 November 1994. He was discharged from bankruptcy on 3 December 1997.
By letter dated 7 May 1998 the applicant was advised by AMP Limited that he had become a shareholder of that company on 1 January 1998, consequent upon the demutualisation of the Australian Mutual Provident Society (“AMP Society”). The letter advised the applicant that he held 2,352 shares in the company and that he had the opportunity to sell or retain them as he chose; these choices were explained in the accompanying prospectus.
The Official Trustee in Bankruptcy (“Official Trustee”) wrote to the applicant claiming that the shares had vested in the Official Trustee pursuant to s 58 of the Bankruptcy Act 1966 (Cth) (“the Act”). The applicant disputed the Official Trustee’s claim to ownership of the shares.
The Official Trustee procured the sale of the shares and the proceeds of sale were paid to the Official Trustee.
The Application

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2000] FCA 457
Decision Date: 11 APRIL 2000

CaseChat Overview and Summary

The case of Unicomb v Official Trustee in Bankruptcy was heard in the Federal Court of Australia. The applicant, who had been declared bankrupt, sought a declaration that he had become beneficially entitled to 2,352 shares in AMP Limited from 1 January 1998 and that the Official Trustee wrongly procured the sale of the said shares and retained the proceeds. The Official Trustee argued that the entitlement to receive shares in AMP Limited was property within the meaning of the Bankruptcy Act 1966 (Cth) and that the applicant acquired the right to the shares when the members of the AMP Society resolved to approve the proposal to demutualise and convert to a company limited by shares. The court had to decide whether the entitlement to receive shares in AMP Limited was property within the meaning of the Act and if the applicant acquired the right to the shares when the members of the AMP Society resolved to approve the proposal. The court found that the entitlement to receive shares in AMP Limited was not property within the meaning of the Act until the shares were actually allotted to the applicant. The applicant's entitlement arose only after the AMP Society converted to a company limited by shares and the applicant obtained statutory rights as a result. The court also found that the applicant's entitlement to the shares arose after his discharge from bankruptcy and therefore was not property of the bankrupt for the purposes of the Act. The court ordered the Official Trustee to pay the proceeds from the sale of the shares to the applicant, together with interest of 10.5 per cent per annum from and including 23 February 1999 until and including Tuesday 11 April 2000, and to pay the applicant's costs of and incidental to the application.

Orders