YARWOOD & SHORE

In proceedings before Judge Scarlett, the applicant, Yarwood, sought property settlement orders against the respondent, Shore. However, since the commencement of these proceedings, Yarwood had been declared bankrupt. The trustee in bankruptcy had not been formally notified in writing of the property proceedings.

The central legal issue before the court was whether the property proceedings should be stayed pursuant to s 60(2) of the *Bankruptcy Act 1966* (Cth) due to the applicant's bankruptcy and the consequent lack of notification to the trustee. The court also considered ancillary matters related to the enforcement of child support debts owed to the Commonwealth and general practice and procedure concerning notification to a trustee.

Judge Scarlett determined that s 60(2) of the *Bankruptcy Act 1966* (Cth) mandated a stay of the proceedings. This provision requires that a bankrupt's property proceedings cannot be continued without the leave of the court or the consent of the trustee. The court reasoned that the purpose of this section is to ensure that the trustee is aware of and can control litigation concerning the bankrupt's assets. Consequently, the court ordered that the amended application be stayed.

The court further ordered that the applicant must notify his trustee in bankruptcy of the proceedings within seven days and seek a written election from the trustee to either prosecute or discontinue the application. The respondent was also directed to forward a copy of her response and supporting affidavit to the applicant's trustee within the same timeframe. The application was adjourned for further mention to allow for these steps to be taken.