RE Heron, Robert James EX PARTE The Official Trustee in Bankruptcy [1997] FCA 107

RE Heron, Robert James EX PARTE The Official Trustee in Bankruptcy [1997] FCA 107

Jean Sayer's indemnity to the Official Trustee made it possible for the Trustee to bring the proceeding against Mid-Coast, which led to the recovery of the net balance of $97,067.26. In those circumstances, and given the wide discretion conferred by sub-s 109(10), it was just and equitable to order payment of a 100% priority dividend in favour of Ms Sayer from that balance, less the Official Trustee's costs of the application.

Jurisdiction
Australia
Judgment Date
04 February 1997
Procedural Posture
Bankruptcy Application Under Sub S 109(10) of the Bankruptcy Act 1966 / Amended Application Filed 17 December 1996; Ex Tempore Reasons for Judgment on 4 February 1997
Outcome
Application granted; 100% priority dividend ordered in favour of Jean Sayer from the available balance, less the Official Trustee's costs of the application.
Legal Topics
['distribution of Recovered Property' 'indemnifying Creditor Priority' 'trustee Litigation Costs' 'bankruptcy Act 1966 S 109(10)']
['bankruptcy'] ['distribution of Recovered Property' 'indemnifying Creditor Priority' 'trustee Litigation Costs' 'bankruptcy Act 1966 S 109(10)']

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Procedural Posture

Bankruptcy Application Under Sub S 109(10) of the Bankruptcy Act 1966 / Amended Application Filed 17 December 1996; Ex Tempore Reasons for Judgment on 4 February 1997

Legal Issues

  1. 1 ['Whether an indemnifying creditor should receive an advantage over other creditors under sub-s 109(10) of the Bankruptcy Act 1966 in distribution of property recovered through litigation funded by the indemnity.' 'Whether Jean Sayer should receive a 100% priority dividend from the remaining balance recovered by the Official Trustee.']

Ratio Decidendi

Jean Sayer's indemnity to the Official Trustee made it possible for the Trustee to bring the proceeding against Mid-Coast, which led to the recovery of the net balance of $97,067.26. In those circumstances, and given the wide discretion conferred by sub-s 109(10), it was just and equitable to order payment of a 100% priority dividend in favour of Ms Sayer from that balance, less the Official Trustee's costs of the application.

Court Disposition

Application granted; 100% priority dividend ordered in favour of Jean Sayer from the available balance, less the Official Trustee's costs of the application.

Orders

  • ['Pursuant to sub-s 109(10) of the Bankruptcy Act 1966, there be distributed to Jean Sayer the amount of $97,067.26 referred to as "Balance" in the letter dated 16 December 1996 from the Insolvency and Trustee Service Australia to Ms Sally Nash, less the Official Trustee\'s costs of the application.' 'Any proceeds...