Spratt, Re T.J. Wilde, Ex Parte W.J. & Ors [1986] FCA 33

Spratt, Re T.J. Wilde, Ex Parte W.J. & Ors [1986] FCA 33

There was a compromise of claims exceeding $20,000 within s.135(1)(f) and (g) of the Bankruptcy Act 1966 to which the trustee was a party, and the trustee's agreement to sell shares formed part of the settlement. Such compromise is invalid without the required statutory permission or leave. The value of the shares exceeded $20,000 and thus leave was also required under s.135(1)(a). The breach of s.58(3), while present, did not vitiate the compromise in these circumstances.

Parties
Bankrupt: Timothy John Spratt; Trustees/applicants: Wilson Joseph Wilde and Ernest George Harris & Ors; First Respondent: Janelle Kaye Spratt; Second Respondent: P. & S. Deco Quarries Pty. Ltd.; Third Respondent: Robert William Peach; Fourth Respondent: John Robert Rees
Jurisdiction
Australia
Judgment Date
19 February 1986
Procedural Posture
Bankruptcy / Application for Declarations (interlocutory/final)
Outcome
Declarations made that a compromise within s.135(1)(f) and (g) occurred; matter adjourned for further hearing.
Legal Topics
Compromise of Claims by and Against Bankrupt, Sale of Property by Trustee, Application of S.135 of Bankruptcy Act 1966, Value of Bankrupt's Property for Statutory Purposes
Bankruptcy Compromise of Claims by and Against Bankrupt Sale of Property by Trustee Application of S.135 of Bankruptcy Act 1966 Value of Bankrupt's Property for Statutory Purposes

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Parties

Timothy John Spratt

Bankrupt

Wilson Joseph Wilde and Ernest George Harris & Ors

Trustees/applicants

Janelle Kaye Spratt

First Respondent

P. & S. Deco Quarries Pty. Ltd.

Second Respondent

Robert William Peach

Third Respondent

John Robert Rees

Fourth Respondent

Procedural Posture

Bankruptcy / Application for Declarations (interlocutory/final)

Legal Issues

  1. 1 Whether compromise reached in Supreme Court proceeding was void under s.135(1)(f) or (g) of Bankruptcy Act 1966
  2. 2 Whether trustee was a party to the compromise
  3. 3 Whether leave or permission was required under s.135(1)(a) to sell shares

Ratio Decidendi

There was a compromise of claims exceeding $20,000 within s.135(1)(f) and (g) of the Bankruptcy Act 1966 to which the trustee was a party, and the trustee's agreement to sell shares formed part of the settlement. Such compromise is invalid without the required statutory permission or leave. The value of the shares exceeded $20,000 and thus leave was also required under s.135(1)(a). The breach of s.58(3), while present, did not vitiate the compromise in these circumstances.

Court Disposition

Declarations made that a compromise within s.135(1)(f) and (g) occurred; matter adjourned for further hearing.

Orders

  • Declared that the fourth respondent made a compromise within the meaning of s.135(1)(f) and (g) of the Bankruptcy Act in respect of action no. 2508 of 1981.
  • Costs of and incidental to the application to date be reserved.