Re Aitken, P.K. & Anor v. Tomasetti Paper Pty Ltd [1987] FCA 651

Re Aitken, P.K. & Anor v. Tomasetti Paper Pty Ltd [1987] FCA 651

The Court found that although the bankrupt was hopelessly insolvent at the time of the payments, there was no evidence that the creditor, Tomasetti, knew or had reasonable cause to suspect insolvency. The payments were made and accepted in good faith and in the ordinary course of business, following the existing pattern over years, so the s.122(2)(a) defence was established.

Parties
Bankrupt: Peter Kevin Aitken; Applicant (trustee): Anthony Christopher Matthews; Respondent (creditor): Tomasetti Paper Pty Limited
Jurisdiction
Australia
Judgment Date
16 October 1987
Procedural Posture
Bankruptcy Application / Judgment on Trustee's S.122 Voidable Preference Application
Outcome
Application dismissed with costs.
Legal Topics
Voidable Preferences, Good Faith Defence, Ordinary Course of Business
Bankruptcy Voidable Preferences Good Faith Defence Ordinary Course of Business

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 8 Party arguments 2 Amounts and remedies 11
Sign in to unlock

Parties

Peter Kevin Aitken

Bankrupt

Anthony Christopher Matthews

Applicant (trustee)

Tomasetti Paper Pty Limited

Respondent (creditor)

Procedural Posture

Bankruptcy Application / Judgment on Trustee's S.122 Voidable Preference Application

Legal Issues

  1. 1 Whether the payments made to Tomasetti Paper Pty Ltd by the bankrupt within six months before the presentation of the petition had the effect of giving a preference, priority or advantage over other creditors under s.122(1) of the Bankruptcy Act 1966
  2. 2 Whether the payments were received by the creditor in good faith for valuable consideration and in the ordinary course of business within the meaning of s.122(2)(a)

Ratio Decidendi

The Court found that although the bankrupt was hopelessly insolvent at the time of the payments, there was no evidence that the creditor, Tomasetti, knew or had reasonable cause to suspect insolvency. The payments were made and accepted in good faith and in the ordinary course of business, following the existing pattern over years, so the s.122(2)(a) defence was established.

Court Disposition

Application dismissed with costs.

Orders

  • The application be dismissed with costs.