Pekar v Holden (Trustee) (No 3) [2019] FCA 1928

Pekar v Holden (Trustee) (No 3) [2019] FCA 1928

The respondent breached the agreement by failing to properly and expeditiously administer the bankrupt estate under the Bankruptcy Act; accordingly, upon termination of the agreement the applicant is entitled to repayment of the remaining funds originally paid under the agreement, with interest from the date of termination. Damages claims for wasted expenditures or legal costs were not established as a consequence of the breach, and expenses pre-dated the agreement. The respondent is to be removed as trustee and personally liable for certain costs and expenses post-April 2019, but not indemnified out of the bankrupt estate for those.

Jurisdiction
Australia
Judgment Date
18 November 2019
Procedural Posture
Civil Bankruptcy / Post Trial Judgment – Orders and Ancillary Issues
Outcome
Declarations made; repayment of funds (less any amount required for remittance) with interest ordered; damages refused; trustee removed; respondent personally liable for specified costs; further orders regarding remission applications by respondent and costs.
Legal Topics
['trustee Removal' 'contract Breach' 'damages' 'interest on Judgments' 'costs Liability' 'bankrupt Estate Administration']
['bankruptcy' 'commercial Law'] ['trustee Removal' 'contract Breach' 'damages' 'interest on Judgments' 'costs Liability' 'bankrupt Estate Administration']

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Procedural Posture

Civil Bankruptcy / Post Trial Judgment – Orders and Ancillary Issues

Legal Issues

  1. 1 ['Whether the respondent breached the agreement with the applicant regarding the administration of the bankrupt estate' 'Whether applicant is entitled to repayment of funds, damages, and interest after agreement termination' 'Whether the respondent should cease to be trustee and be personally liable for specified costs' 'Whether the stay order should be lifted' 'Whether the Court should refer the respondent for investigation']

Ratio Decidendi

The respondent breached the agreement by failing to properly and expeditiously administer the bankrupt estate under the Bankruptcy Act; accordingly, upon termination of the agreement the applicant is entitled to repayment of the remaining funds originally paid under the agreement, with interest from the date of termination. Damages claims for wasted expenditures or legal costs were not established as a consequence of the breach, and expenses pre-dated the agreement. The respondent is to be removed as trustee and personally liable for certain costs and expenses post-April 2019, but not indemnified out of the bankrupt estate for those.

Court Disposition

Declarations made; repayment of funds (less any amount required for remittance) with interest ordered; damages refused; trustee removed; respondent personally liable for specified costs; further orders regarding remission applications by respondent and costs.

Orders

  • ['The respondent breached the contract and agreement terminated with demand for repayment.' 'Respondent to pay applicant $180,102.24 (less any portion legally required to be remitted), plus interest from 2 August 2018 to payment date under GPN-INT.' 'Respondent to apply for remission of specified realisation and...