Re MacDonald, Christine Anne & Anor Ex Parte Deputy Commissioner of Taxation [1996] FCA 410

Re MacDonald, Christine Anne & Anor Ex Parte Deputy Commissioner of Taxation [1996] FCA 410

On the material before the Court, both debtors were solvent at the date of the sequestration orders, so the discretion under s 153B of the Bankruptcy Act 1966 was enlivened. Although their financial position was tight and their inactivity had caused others to incur costs, the Court was not satisfied that annulment would be futile and exercised its discretion to annul each bankruptcy on terms requiring payment of relevant costs and $39,000 by each debtor to the Deputy Commissioner of Taxation.

Jurisdiction
Australia
Judgment Date
18 April 1996
Procedural Posture
Bankruptcy / Application Under S 153 B of the Bankruptcy Act 1966 to Annul Bankruptcies Consequent Upon Sequestration Orders Made on 21 June 1995
Outcome
The bankruptcies of Christine Anne MacDonald and Kevin Robert MacDonald were annulled, with declarations, costs orders, payment orders to the Deputy Commissioner of Taxation, and liberty to apply.
Legal Topics
['annulment of Bankruptcy' 'sequestration Order' 'solvency' 'costs of Bankruptcy Administration' 'tax Debts']
['bankruptcy and Insolvency' 'taxation'] ['annulment of Bankruptcy' 'sequestration Order' 'solvency' 'costs of Bankruptcy Administration' 'tax Debts']

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Procedural Posture

Bankruptcy / Application Under S 153 B of the Bankruptcy Act 1966 to Annul Bankruptcies Consequent Upon Sequestration Orders Made on 21 June 1995

Legal Issues

  1. 1 ['Whether the Court was satisfied that the sequestration orders ought not to have been made because each debtor was solvent at the time the orders were made.' 'Whether the Court should exercise its discretion under s 153B of the Bankruptcy Act 1966 to annul each bankruptcy.' 'What terms as to costs and payments should accompany annulment.']

Ratio Decidendi

On the material before the Court, both debtors were solvent at the date of the sequestration orders, so the discretion under s 153B of the Bankruptcy Act 1966 was enlivened. Although their financial position was tight and their inactivity had caused others to incur costs, the Court was not satisfied that annulment would be futile and exercised its discretion to annul each bankruptcy on terms requiring payment of relevant costs and $39,000 by each debtor to the Deputy Commissioner of Taxation.

Court Disposition

The bankruptcies of Christine Anne MacDonald and Kevin Robert MacDonald were annulled, with declarations, costs orders, payment orders to the Deputy Commissioner of Taxation, and liberty to apply.

Orders

  • ['The Court declares that it is satisfied that a sequestration order ought not to have been made of the estate of Kevin Robert MacDonald or the estate of Christine Anne MacDonald.' 'The bankruptcy of Christine Anne MacDonald be annulled.' 'The bankruptcy of Kevin Robert MacDonald be annulled.' 'Each of Mr and Mrs...