Rambaldi v Meletsis, in the matter of Karas (Bankrupt) [2018] FCA 791

Rambaldi v Meletsis, in the matter of Karas (Bankrupt) [2018] FCA 791

The trustees had power under Bankruptcy Act 1966 (Cth) s 134 to acquire the assigned claims because s 134 confers broad powers on trustees in administering the bankrupt estate, including acquiring property where that course is in creditors' interests and likely to maximise returns. The assigned claims were acquired by the trustees in their capacity as trustees of the bankrupt estate using estate funds, so the right to sue was a chose in action of the bankrupt estate and any recoveries would be accountable to the estate and creditors. The required causal connection for property 'arising out of' estate property was satisfied by the use of the bankrupt estate's funds to acquire the claims....

Jurisdiction
Australia
Judgment Date
01 August 2018
Procedural Posture
Bankruptcy Proceeding Concerning Trustees' Assigned Claims / Interlocutory Applications for Summary Dismissal, Declaration or Direction and Judicial Advice, and Leave to Intervene
Outcome
The Court held that the trustees had power to acquire the assigned claims, that it was reasonable and appropriate to give the judicial advice sought, and that the Deputy Commissioner of Taxation should be granted leave to intervene on the limited basis sought; the parties were directed to provide minutes of orders.
Legal Topics
["trustees' Powers Under Bankruptcy Act 1966 (cth) S 134" 'property of the Bankrupt' 'after Acquired Property' 'assignment of Causes of Action' 'judicial Advice to Trustees' 'summary Dismissal' 'intervention by Creditor']
['bankruptcy' 'trusts and Trustees' 'insolvency' 'practice and Procedure' 'statutory Interpretation'] ["trustees' Powers Under Bankruptcy Act 1966 (cth) S 134" 'property of the Bankrupt' 'after Acquired Property' 'assignment of Causes of Action' 'judicial Advice to Trustees' 'summary Dismissal' 'intervention by Creditor']

Case Brief

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Procedural Posture

Bankruptcy Proceeding Concerning Trustees' Assigned Claims / Interlocutory Applications for Summary Dismissal, Declaration or Direction and Judicial Advice, and Leave to Intervene

Legal Issues

  1. 1 ['Whether the trustees had power to acquire assigned causes of action from the liquidator and company.' 'Whether the Court should give judicial advice that the trustees were justified in acquiring the assigned claims.' 'Whether the deed of assignment is valid and enforceable.' 'Whether the assigned claims should be summarily dismissed.' 'Whether the Deputy Commissioner of Taxation should have leave to intervene on a limited basis.']

Ratio Decidendi

The trustees had power under Bankruptcy Act 1966 (Cth) s 134 to acquire the assigned claims because s 134 confers broad powers on trustees in administering the bankrupt estate, including acquiring property where that course is in creditors' interests and likely to maximise returns. The assigned claims were acquired by the trustees in their capacity as trustees of the bankrupt estate using estate funds, so the right to sue was a chose in action of the bankrupt estate and any recoveries would be accountable to the estate and creditors. The required causal connection for property 'arising out of' estate property was satisfied by the use of the bankrupt estate's funds to acquire the claims....

Court Disposition

The Court held that the trustees had power to acquire the assigned claims, that it was reasonable and appropriate to give the judicial advice sought, and that the Deputy Commissioner of Taxation should be granted leave to intervene on the limited basis sought; the parties were directed to provide minutes of orders.

Orders

  • ['The parties are directed to provide minutes of orders giving effect to these reasons within 7 days.' 'Leave to intervene on the limited basis sought by the Deputy Commissioner of Taxation is to be granted.']