Warner v Mayfair Limited, in the matter of the Personal Insolvency Agreement of Gore

The applicant, Mr Warner, sought directions and advice in relation to money held by him as trustee of the Personal Insolvency Agreement (PIA) of Mr Craig Kirrin Gore. Mr Warner replaced the original trustee, Mr Maxwell Prentice, pursuant to a resolution of creditors. The PIA was formed in 2010 and provided for funds to be paid to the trustee for the benefit of creditors. However, the PIA was terminated in 2012, and Mr Gore subsequently became bankrupt. Various parties, including Mayfair Group and 21st Century, asserted claims to the assets held by Mr Warner after the termination of the PIA.

The legal issues before the court included whether provisions of the PIA survived its termination, whether Mr Warner, as the trustee under the PIA, was entitled to rule on proofs of debt after termination, and whether a dividend declared in respect of a proof of debt labelled “under consideration” was payable. The court also had to determine if certain sections of the Bankruptcy Act gave rise to a statutory entitlement to be paid a dividend declared prior to the termination of the PIA, whether Mr Warner was entitled to remuneration and costs after termination, and if the parties asserting an interest in the moneys held by Mr Warner were entitled to costs. Lastly, the court had to decide if residual funds should vest in the Official Trustee in Bankruptcy pursuant to section 58 of the Bankruptcy Act.

The court concluded that the litigation was directed at the due administration of the trust, and Mr Warner should pay the reasonable costs of the respondents from the residual moneys in his hands. The court advised Mr Warner to pay any residual funds in his hands in relation to the PIA to Mr Gore’s trustee in bankruptcy after paying his legal costs and the reasonable costs of the respondents. The court also directed the parties to provide details of their claimed costs and directed Mr Warner to file draft short minutes of order reflecting these reasons.

The court's final orders included a deadline for the respondents to advise Mr Warner and the court of the amount they claimed as their reasonable costs of and incidental to the application, a deadline for any party to file brief submissions if they took issue with the amount claimed, and a deadline for Mr Warner to file draft short minutes of order reflecting these reasons. The court reserved its decision in relation to any amount so claimed by the parties.