United Petroleum Pty Ltd v Bousaleh

The case involved an application for review of a sequestration order made against Gail Christine Bousaleh (the Debtor). The original sequestration order was made on 15 August 2019, following a creditor's petition by United Petroleum Pty Ltd (the Creditor). Katherine Elizabeth Barnet was appointed as the Trustee of the Debtor's estate. The Debtor subsequently applied to have the sequestration order set aside, arguing that her debts had been settled and that she was not insolvent.

The primary legal issue before the court was whether the sequestration order should be set aside, and if so, what further orders should be made. Specifically, the court had to determine whether to simply set aside the sequestration order and dismiss the creditor's petition, or whether to also make an order annulling the bankruptcy under section 153B of the *Bankruptcy Act 1966* (Cth). This distinction was crucial for determining the Trustee's entitlement to costs, expenses, and remuneration incurred during her administration of the estate.

The court reasoned that the Debtor's application for review had merit because the Creditor's debt had been settled, and no other creditor sought to be substituted as the petitioning creditor. Furthermore, the Trustee's report indicated that the Debtor had made arrangements satisfactory to the Australian Taxation Office and was now solvent. The court noted that simply setting aside the sequestration order would leave the Trustee without a statutory basis to recover her remuneration and expenses, forcing her to rely on general law. Drawing on the principles established in *Flint v Richard Busuttil & Company Pty Ltd and Another* and *Pattison v Hadjimouratis*, the court concluded that an annulment order under section 153B was appropriate. This would allow the Trustee to avail herself of section 154 of the *Bankruptcy Act*, enabling her to apply the Debtor's property towards her remuneration and expenses.

Consequently, the court ordered that the sequestration order be set aside and the Creditor's Petition be dismissed. Crucially, the court also made an order annulling the Debtor's bankruptcy under section 153B of the *Bankruptcy Act 1966* (Cth). The court further ordered that the Trustee's costs, expenses, and remuneration incurred since the making of the sequestration order be paid from the Debtor's estate, finding that the Trustee was not disentitled to these amounts.