RE Hawkins, Connie (also known as Connie Murray) EX PARTE Worrell, Ivor [1996] FCA 1169

RE Hawkins, Connie (also known as Connie Murray) EX PARTE Worrell, Ivor [1996] FCA 1169

Of the $100,000.00 to be paid to the bankrupt following bankruptcy under the maintenance agreement, one half ($50,000.00) constitutes divisible property under s 5 of the Bankruptcy Act 1966, and one half ($50,000.00) is provision for maintenance and thus is income under s 139L of the Act. The characterisation depends on the intention of the parties as evidenced by the agreement.

Parties
Bankrupt: Connie Hawkins (also known as Connie Murray); Trustee/applicant: Ivor Worrell; Former Husband: John Watson Hawkins
Jurisdiction
Australia
Judgment Date
20 December 1996
Procedural Posture
Application for Declaration in Bankruptcy Proceeding / Final Judgment at First Instance
Outcome
Declaration made as to characterisation of payments; costs to be borne by each party with trustee’s costs to be costs in administration of estate.
Legal Topics
After Acquired Property, Maintenance Payments, Property Divisible Among Creditors, Income Under Bankruptcy Act, Maintenance Under Family Law Act
Bankruptcy Family Law After Acquired Property Maintenance Payments Property Divisible Among Creditors Income Under Bankruptcy Act Maintenance Under Family Law Act

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Parties

Connie Hawkins (also known as Connie Murray)

Bankrupt

Ivor Worrell

Trustee/applicant

John Watson Hawkins

Former Husband

Procedural Posture

Application for Declaration in Bankruptcy Proceeding / Final Judgment at First Instance

Legal Issues

  1. 1 Whether payments made to the bankrupt pursuant to a maintenance agreement are 'property of the bankrupt' under s 5 of the Bankruptcy Act 1966
  2. 2 Whether such payments are 'income' under s 139L of the Bankruptcy Act 1966 and thereby subject to contribution regime in Bankruptcy
  3. 3 Proper characterization of the nature of maintenance payments received after bankruptcy

Ratio Decidendi

Of the $100,000.00 to be paid to the bankrupt following bankruptcy under the maintenance agreement, one half ($50,000.00) constitutes divisible property under s 5 of the Bankruptcy Act 1966, and one half ($50,000.00) is provision for maintenance and thus is income under s 139L of the Act. The characterisation depends on the intention of the parties as evidenced by the agreement.

Court Disposition

Declaration made as to characterisation of payments; costs to be borne by each party with trustee’s costs to be costs in administration of estate.

Orders

  • Of the $100,000.00 to be paid pursuant to the maintenance agreement dated 7 February 1995 subsequent to 8 February 1996, one half is 'the property of the bankrupt' within s 5 of the Bankruptcy Act 1966 and one half is payment by way of provision for the bankrupt's maintenance, which half is 'income' within s 139L of...
  • Each party bear their own costs; the costs of the trustee to be his costs in the administration of the bankrupt's estate.