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Bankruptcy Amendment Regulations 2004 (No. 1)

Authoritative Version
  • - F2004B00287
  • No longer in force
SR 2004 No. 256 Regulations as made
These Regulations amend the Bankruptcy Regulations 1996.
Administered by: Attorney-General's
General Comments: This instrument was backcaptured in accordance with Section 36 of the Legislative Instruments Act 2003
Registered 01 Jan 2005
Tabling HistoryDate
Tabled Senate30-Aug-2004
Tabled HR16-Nov-2004
Gazetted 26 Aug 2004
Date of repeal 09 Apr 2013
Repealed by Attorney-General's (Spent and Redundant Instruments) Repeal Regulation 2013

Bankruptcy Amendment Regulations 2004 (No. 1)1

Statutory Rules 2004 No. 2562

I, PHILIP MICHAEL JEFFERY, Governor-General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the Bankruptcy Act 1966.

Dated 19 August 2004

P. M. JEFFERY

Governor-General

By His Excellency’s Command

PHILIP RUDDOCK


1              Name of Regulations

                These Regulations are the Bankruptcy Amendment Regulations 2004 (No. 1).

2              Commencement

                These Regulations commence on the commencement of Schedule 1 to the Bankruptcy Legislation Amendment Act 2004.

3              Amendment of Bankruptcy Regulations 1996

                Schedule 1 amends the Bankruptcy Regulations 1996.


Schedule 1        Amendments

(regulation 3)

  

[1]           Paragraph 4.07 (2) (a)

omit

an assignment, arrangement or composition under Part X of the Act,

insert

a personal insolvency agreement,

[2]           Subparagraph 4.11 (1) (e) (ii)

omit

Official Trustee,

insert

Official Receiver,

[3]           Regulation 6.16

omit

[4]           Part 8, Division 6, Subdivision 4, heading

substitute

Subdivision 4              Other committee-related matters

[5]           Part 8, Division 6, after Subdivision 4

insert

Subdivision 4A            Standards for trustees

8.34A      Performance standards for trustees (including controlling trustees)

         (1)   For subsection 155H (5) of the Act, the standards applicable to the exercise of powers, or the carrying out of duties, of registered trustees are set out in Schedule 4A.

         (2)   For subsection 188 (2A) of the Act, the standards in Parts 1, 2 and 5 of Schedule 4A also apply to a solicitor who is a controlling trustee.

[6]           Paragraph 8.35 (1) (e)

omit

authorisation.

insert

authorisation; or

[7]           After paragraph 8.35 (1) (e)

insert

                (f)    has not, by 1 December 2006:

                          (i)    become a full member of the Insolvency Practitioners Association of Australia; or

                         (ii)    satisfactorily completed a course in insolvency approved by the Inspector-General.

[8]           After subregulation 8.35 (1)

insert

      (1A)   The Inspector-General may approve a course in insolvency by notice published on the Insolvency and Trustee Service Australia’s website.

Note   Paper copies of the notice are available from the Insolvency and Trustee Service Australia on request.

[9]           Paragraph 8.35 (2) (a)

substitute

                (a)    has failed to properly exercise the powers, or carry out the duties, of a controlling trustee, including meeting a standard applicable to a controlling trustee set out in Schedule 4A; or

[10]         Paragraph 9.04 (1) (b)

omit

paragraph 155H (1) (a), (b), (e) or (f)

insert

paragraph 155H (1) (a), (b), (e), (f) or (g)

[11]         Part 10

substitute

Part 10               Personal insolvency agreements

10.01      Modifications of Part X of the Act — joint debtors

                For section 187A of the Act, a provision of Part X of the Act specified in Part 1 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that section, to joint debtors, whether partners or not.

10.02      Information to be given to debtor (Act ss 188 (2AA) and (2AB))

         (1)   For subsections 188 (2AA) and (2AB) of the Act, the following information is prescribed:

                (a)    information about the consequences of entering into a personal insolvency agreement;

               (b)    information about sources of financial advice and guidance to persons facing or contemplating entering into a personal insolvency agreement;

                (c)    information about whether a personal insolvency agreement may be administered by a registered trustee or the Official Trustee;

               (d)    a statement that it is an act of bankruptcy if a debtor does any of the things mentioned in paragraphs 40 (1) (i) to (m) of the Act;

                (e)    information about the processes under Part X of the Act;

                (f)    information about a debtor’s rights and responsibilities under Part X of the Act, including a debtor’s obligation to disclose all related entities;

               (g)    information about a controlling trustee’s obligation to disclose his or her relationship with a debtor.

         (2)   The information must be factual and objective.

         (3)   A person authorised under subsection 188 (1) of the Act to take control of a debtor’s property must not consent to exercise the powers given by the authority unless the debtor has given the person a signed acknowledgement (which may be included with or appended to the authority) that the debtor has received and read the prescribed information.

         (4)   Subregulation (5) applies if a debtor intending to sign an authority is unable to properly read the authority, prescribed information and acknowledgement (the relevant material) because he or she is:

                (a)    blind, partially sighted, illiterate or partially literate; or

               (b)    insufficiently familiar with the English language.

         (5)   The authority and acknowledgement may be signed by another person if that person signs a statement to the effect that:

                (a)    if paragraph (4) (a) applies — he or she has carefully read the relevant material to the debtor; or

               (b)    if paragraph (4) (b) applies — he or she has carefully interpreted the relevant material to the debtor in a language that both persons understand.

10.03      Documents under section 188 of Act

         (1)   A registered trustee or solicitor who consents to exercise the powers given by an authority under section 188 of the Act must sign a consent in accordance with the approved form.

         (2)   The registered trustee or solicitor must, within 2 working days of consenting, give to the Official Receiver for the District in which the debtor resides, a copy of:

                (a)    the signed form; and

               (b)    the proposal for dealing with the debtor’s affairs under Part X of the Act.

Note 1   Subsection 188 (2E) of the Act provides that a proposal for dealing with a debtor’s affairs under Part X of the Act must include a draft personal insolvency agreement.

Note 2   Under subsection 188 (5) of the Act, a registered trustee or solicitor who consents to exercise the powers given by an authority must also give to the Official Receiver for the District in which the debtor resides, a copy of the authority and the debtor’s statement of affairs.

10.04      Documents for meeting called under an authority under section 188 of the Act

                At least 10 days before the first meeting of creditors is called under an authority under section 188 of the Act, the controlling trustee must give to the Official Receiver for the District in which the debtor resides, to the debtor and to each creditor:

                (a)    notice in writing of the date, time and place of the meeting; and

               (b)    a copy of the controlling trustee’s report, prepared in accordance with subsection 189A (1) of the Act, in relation to the debtor’s affairs; and

                (c)    a copy of the controlling trustee’s statement, prepared in accordance with subsection 189B (1) of the Act, in relation to special resolutions expected to be passed at the meeting; and

               (d)    a notice that includes the basis and the method on which the controlling trustee seeks to be remunerated, and, if appropriate, an estimate of the expected level of the controlling trustee’s remuneration; and

                (e)    if the controlling trustee claims remuneration calculated by reference to an hourly rate — a notice stating:

                          (i)    the type of work undertaken by the trustee and the trustee’s staff; and

                         (ii)    the number of hours charged by each person; and

                        (iii)    the hourly rate charged for each person; and

                        (iv)    the total remuneration claimed; and

                (f)    a notice informing the debtor and each creditor of their right, within 28 days of receiving notice of a controlling trustee’s claim for remuneration, to request that the claim be taxed.

Note   Section 194 of the Act sets out the time for when a meeting that is to be called under an authority under section 188 of the Act must be held.

10.05      Modifications of Division 5 of Part IV of the
Act — meetings called under authorities under section 188 of the Act

                For section 196 of the Act, a provision of Division 5 of Part IV of the Act specified in Part 2 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that section, to a meeting called under an authority under section 188 of the Act.

10.06      Controlling trustee to give Official Receiver copy of special resolution and certain particulars for the Index

         (1)   If, at a meeting called under an authority under section 188 of the Act, a special resolution is passed under subsection 204 (1) of the Act, the controlling trustee must give to the Official Receiver, within 7 days after the date when the resolution is passed:

                (a)    a copy of the resolution; and

               (b)    written notice specifying the following particulars for entry in the Index:

                          (i)    the date of the resolution;

                         (ii)    in respect of the debtor:

                                   (A)     the debtor’s full name, and any alias;

                                   (B)     the debtor’s address;

                                   (C)     the debtor’s occupation (if any);

                        (iii)    if the resolution requires the debtor to execute a personal insolvency agreement — the name of each person nominated under subsection 204 (3) of the Act to be a trustee of the agreement.

Penalty:   1 penalty unit.

         (2)   An offence against subregulation (1) is an offence of strict liability.

10.07      Modifications of Part VIII of the Act — controlling trustees and trustees of personal insolvency agreements

                For section 210 of the Act, a provision of Part VIII of the Act specified in Part 3 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that section, to the controlling trustee in relation to a debtor.

10.08      Modifications of Division 1 of Part V of the Act — debtors whose property is subject to control under Division 2 of Part X of the Act

                For subsection 211 (1) of the Act, a provision in Division 1 of Part V of the Act specified in Part 4 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that subsection, to a debtor whose property is subject to control under Division 2 of Part X of the Act.

10.09      Meeting if trustee does not execute personal insolvency agreement

         (1)   A meeting of creditors under subsection 217 (1) of the Act must be called in accordance with a written notice of the meeting that was given at least 7 days before the meeting to each of the following persons (other than the person giving the notice):

                (a)    the debtor;

               (b)    the trustee required to execute the personal insolvency agreement;

                (c)    each creditor whose identity and address are known to, or can reasonably be discovered by, the person giving the notice.

         (2)   A notice under subregulation (1) must set out the terms of any resolution proposed under subsection 217 (1) of the Act that is known to the person giving the notice.

10.10      Notification of personal insolvency agreement

                A notification under paragraph 218 (1) (a) of the Act must be in writing.

Note   Regulation 16.01 applies to a notification under paragraph 218 (1) (a) of the Act.

10.11      Sequestration order, or order terminating or setting aside a personal insolvency agreement — notice to Official Receiver (Act s 221, s 222 and s 222C)

         (1)   This regulation does not apply in relation to an applicant who is the Official Trustee, the Inspector-General or a person authorised by the Inspector-General under subsection 222 (1) or (5) of the Act.

         (2)   If the Court makes a sequestration order under subsection 221 (1), 222 (10) or 222C (5) of the Act, the applicant for the order must give a copy of the order to the Official Receiver.

         (3)   If the Court makes an order:

                (a)    under subsection 222 (1), (2) or (5) of the Act, setting aside a personal insolvency agreement; or

               (b)    under subsection 222C (1) of the Act, terminating a personal insolvency agreement;

the applicant for the order must give a copy of the order to the Official Receiver.

         (4)   A copy of an order required by this regulation to be given to the Official Receiver must be given within 2 days after the order is made.

Penalty:   1 penalty unit.

         (5)   An offence against subregulation (4) is an offence of strict liability.

10.12      Termination of personal insolvency agreement by trustee (Act s 222A)

         (1)   If a personal insolvency agreement is terminated in accordance with section 222A of the Act, the trustee of the agreement must immediately give written notice of the termination to the Official Receiver.

Penalty:   1 penalty unit.

         (2)   An offence against subregulation (1) is an offence of strict liability.

10.13      Modifications of Parts V and VI of the Act — personal insolvency agreements

         (1)   For subsection 231 (1) of the Act, the provision specified in Part 5 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that subsection, to a debtor who has executed a personal insolvency agreement.

         (2)   For subsection 231 (3) of the Act, a provision specified in Part 6 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that subsection, to a personal insolvency agreement.

         (3)   For subsection 231 (5) of the Act, the provision specified in Part 7 of Schedule 6 is modified in accordance with that Part in relation to its application, in accordance with that subsection, to a trustee of a personal insolvency agreement.

10.14      Certificate relating to realisation of divisible property and non-availability of dividend

         (1)   If the trustee of a personal insolvency agreement is satisfied that the divisible property of the debtor has, so far as practicable, been realised and no dividend is payable to the creditors, the trustee must, on written request by the debtor, give the debtor a certificate signed by the trustee to that effect.

         (2)   The trustee must give the certificate to the debtor within 7 days of receiving the written request.

         (3)   In any proceeding, a certificate signed by the trustee under subregulation (1):

                (a)    is evidence of the facts stated in it; and

               (b)    may be tendered in evidence without further proof.

         (4)   If the trustee gives a certificate to the debtor under subsection 232 (1) of the Act or subregulation (1), the trustee must, within 7 days of giving the certificate, give a copy of the certificate to the Official Receiver.

Penalty:   1 penalty unit.

         (5)   An offence against subregulation (4) is an offence of strict liability.

[12]         Paragraph 13.03 (1) (a)

omit

arrangement under Part X of the Act,

insert

personal insolvency agreement,

[13]         Subparagraph 16.07A (1) (c) (ii)

substitute

                         (ii)    as trustee of a personal insolvency agreement.

[14]         Paragraph 16.14 (1A) (b)

substitute

               (b)    acts as controlling trustee or trustee of a personal insolvency agreement;

[15]         Schedule 2, before item 1

1A           After subsection 64A (2)

substitute

         (2)   Notice of a meeting must:

                (a)    be given in a manner specified in the regulations; and

               (b)    be published in:

                          (i)    a national daily newspaper that circulates throughout Australia; and

                         (ii)    a regional daily newspaper of the State or Territory in which the debtor resides.

[16]         Schedule 2, after item 1

insert

1B           After paragraph 64D (aa)

insert

              (ab)    whether the creditor, in relation to the debtor, is a related entity; and

[17]         Schedule 2, after item 10

insert

10A         Before subsection 64Y (1)

insert

      (1A)   The trustee may adjourn a meeting to undertake further investigations, in relation to the proposal for the composition or scheme of arrangement, that the trustee considers necessary.

      (1B)   The creditors attending the meeting may, by special resolution, revoke the trustee’s decision to adjourn the meeting.

[18]         Schedule 2, after item 11

insert

11A         After subsection 64ZC (5)

insert

      (5A)   An instrument appointing a proxy must include a statement:

                (a)    disclosing whether or not the proxy has received a financial incentive to vote in a particular way:

                          (i)    on a particular matter or matters that may arise at the meeting; or

                         (ii)    on a particular motion or motions that may be proposed at the meeting; and

               (b)    including information to the effect that it is an offence, under subsection 263C (1), to give the trustee a voting document knowing or reckless that the document is false or misleading in a material particular.

[19]         After Schedule 4

insert

Schedule 4A      Performance standards for trustees (including controlling trustees)

(regulation 8.34A)

Part 1          Preliminary

1.1           Purpose

         (1)   This Schedule sets out standards for the minimum level of acceptable conduct and performance of:

                (a)    a registered trustee when exercising the powers, or carrying out the duties, of a registered trustee under the Act; and

               (b)    a solicitor exercising the powers, or carrying out the duties, of a controlling trustee under the Act.

Note 1   Subsection 155H (1) of the Act provides that the Inspector-General may ask a registered trustee to give the Inspector-General a written explanation why the trustee should continue to be registered, if the Inspector-General believes that the trustee has failed to comply with a standard prescribed in Schedule 4A. Under subsection 155H (2) of the Act, if the Inspector-General does not receive an explanation within a reasonable time, or is not satisfied by the explanation, the Inspector-General must convene a committee to consider whether the trustee should continue to be registered. Section 155I of the Act sets out the committee’s powers when considering whether a trustee should continue to be registered.

Matters that the Inspector-General or a committee might consider include:

(a)   the importance of a standard that has not been complied with; and

(b)   the seriousness of the effect of a failure to comply with a standard, including the impact the failure to comply has on a particular estate; and

(c)   a trustee’s performance history and whether the trustee has previously failed to comply with a standard.

Note 2   Under paragraph 8.35 (2) (a), the Inspector-General may determine that a person who is or has been a controlling trustee is not eligible to act as a controlling trustee because the person has failed to meet a standard in this Schedule that applies to a controlling trustee.

         (2)   The purpose of these standards is to ensure:

                (a)    that a person to whom these standards apply acts at all times in accordance with the person’s powers and duties under the Act and these Regulations and in relation to the practice of bankruptcy law generally; and

               (b)    that an administration to which these standards apply is carried out consistently at a high level.

1.2           Definitions

                In this Schedule:

administration means:

                (a)    the administration of the estate of a bankrupt; or

               (b)    the administration of a composition or scheme of arrangement under Division 6 of Part IV of the Act; or

                (c)    the administration of a personal insolvency agreement; or

               (d)    the administration of a debtor’s property that has become subject to control under Division 2 of Part X of the Act; or

                (e)    the administration of the estate of a deceased person under Part XI of the Act.

contribution assessment period, in relation to a bankrupt, has the meaning given by section 139K of the Act.

contributions liability, in relation to a bankrupt, means the contribution that a bankrupt is liable to pay in respect of a contribution assessment period, calculated in accordance with section 139S of the Act.

controlling trustee means a registered trustee or a solicitor who is controlling the property of a debtor under an authority given under section 188 of the Act.

deceased person means a deceased person in respect of whose estate an order for administration under Part XI of the Act has been made.

divisible property:

                (a)    in relation to a bankrupt, means property divisible among his or her creditors within the meaning of section 116 of the Act; and

               (b)    in relation to a debtor, means property divisible among his or her creditors within the meaning of section 187 of the Act; and

                (c)    in relation to a deceased person, means the divisible property of that person’s estate as defined by subsection 249 (6) of the Act.

Part 2          General standards

Division 2.1    Application

2.1           Application of Part 2

                This Part applies to:

                (a)    the trustee of the estate of a bankrupt; and

               (b)    the trustee of a composition or scheme of arrangement under Division 6 of Part IV of the Act; and

                (c)    the trustee of a personal insolvency agreement; and

               (d)    a controlling trustee; and

                (e)    the trustee of the estate of a deceased person.

Division 2.2    General

2.2           Duty to act honestly and impartially

         (1)   The trustee must act honestly and impartially in relation to each administration, including not signing, or associating himself or herself with, a document that the trustee knows, or ought reasonably to know, is false or misleading.

         (2)   The trustee must not include in any document prepared by the trustee a clause that disclaims the trustee’s responsibility for the document’s authenticity.

2.3           Conflict of interest

                If, during an administration, it becomes apparent that the trustee has an actual or potential conflict of interest in relation to the administration, the trustee must, as soon as practicable after becoming aware of the conflict of interest:

                (a)    notify the creditors, the person who appointed the trustee, a committee of inspection or the court, as appropriate, of the conflict of interest; and

               (b)    take appropriate steps to avoid the conflict of interest.

Examples of conflicts of interest

1.       The appointer or, in the case of a sequestration order, the bankrupt is or was a client of the trustee or the trustee’s firm in relation to a financial, trust or insolvency planning matter.

2.       The trustee or a member of the trustee’s firm is a personal friend, relative or business associate of the debtor.

2.4           Use of information relating to an administration

                The trustee must comply with section 16A of the Privacy Act 1988 when dealing with information relating to an administration.

Note   Section 16A of the Privacy Act 1988 provides that an organisation must not do an act, or engage in a practice:

(a)   that breaches an approved privacy code binding the organisation; or

(b)   to the extent (if any) that the organisation is not bound by an approved privacy code — that breaches a National Privacy Principle.

The National Privacy Principles are set out in Schedule 3 to the Privacy Act 1988.

2.5           Compliance with standards by trustee’s employees

                The trustee must ensure that his or her employees comply with these standards.

2.6           Preliminary inquiries and actions

                The trustee must undertake preliminary inquiries and actions at the start of each administration, including the following:

                (a)    informing the bankrupt, debtor or legal personal representative of the deceased person of his or her obligations under the Act and the penalties for failing to comply with those obligations;

               (b)    obtaining and reviewing the statement of affairs of the bankrupt, debtor or deceased person;

                (c)    if necessary, interviewing the bankrupt, debtor or legal personal representative of the deceased person to clarify any matters in the statement of affairs;

               (d)    identifying and making an assessment of realisable assets that could be expected to:

                          (i)    provide, on a cost-benefit basis, a return to creditors; or

                         (ii)    contribute to the payment of the costs and fees of the administration;

                (e)    assessing a bankrupt’s contributions liability;

                (f)    determining the likelihood of whether the estate of the bankrupt or deceased person, or the property of the debtor, includes property that can be realised to pay a dividend to creditors;

               (g)    if the trustee has a genuine reason for believing that a bankrupt, debtor or legal personal representative of the deceased person may not have disclosed an interest in real or other registered property — conducting appropriate searches for such property;

               (h)    if information obtained from a search mentioned in paragraph (g) shows that the bankrupt, debtor or legal representative of the deceased person has not made full and true disclosure of his or her interest in property:

                          (i)    making inquiries of third parties about the information; or

                         (ii)    if further inquiries are not made, explaining to the creditors why further inquiries were considered unnecessary;

                (i)    if the trustee considers that there may have been antecedent transactions — making inquiries of third parties to identify those transactions;

                (j)    cooperating with the Inspector-General by, for example, responding to reasonable requests for information.

2.7           Investigation of matters affecting administration

         (1)   The trustee must consider the views of creditors regarding the extent to which investigations are undertaken in an administration.

         (2)   The trustee must inform creditors, as soon as practicable, of the outcomes of inquiries undertaken in the administration.

Division 2.3    Assets

2.8           Realising assets

                The trustee must realise only those assets:

                (a)    that will give a cost-effective return to creditors; or

               (b)    that contribute to the payment of the costs of the administration; or

                (c)    that may be realised in accordance with a personal insolvency agreement.

2.9           Ownership or interests in assets

                In determining the ownership of, or an interest in, an asset that is part of divisible property, the trustee must act reasonably and claim only the amount that fairly represents the interest in, or value of, the asset.

2.10        Obtaining advice about interest or value

                If the value of divisible property is likely to have a material impact on the administration, the trustee must obtain advice from an independent expert in assessing:

                (a)    the extent of the trustee’s interest in any realisable asset; and

               (b)    the value of the property or offers for the property.

2.11        Disposal of property

                The trustee must act independently and impartially in undertaking transactions and dealings relating to the disposal of the property of a bankrupt, debtor or deceased person.

2.12        Records

                If, in an administration, the trustee makes a decision about the identification, protection, realisation or write-off of a significant asset of a bankrupt, debtor or deceased person that may have a material impact on the administration, the trustee must:

                (a)    record the decision in writing; and

               (b)    keep the record on the trustee’s file for the administration.

Division 2.4    Remuneration and costs

2.13        Costs incurred to be necessary and reasonable

                In conducting an administration, the trustee must:

                (a)    incur only those costs that are necessary and reasonable; and

               (b)    before deciding whether it is appropriate to incur a cost, compare the amount of the cost likely to be incurred with the value and complexity of the administration.

2.14        Receipt of moneys as trustee’s remuneration

         (1)   If the trustee receives moneys from a debtor, bankrupt, legal personal representative of a deceased person, creditor or third party that are intended to cover the trustee’s remuneration, the moneys must be:

                (a)    included in the trustee’s remuneration fixed in accordance with section 162 of the Act; and

               (b)    properly accounted for in accordance with sections 168 and 169 of the Act.

         (2)   Subclause (1) does not apply to moneys recovered by the trustee under subsection 161B (2) of the Act.

2.15        Rate for tasks undertaken by trustee’s staff

                The trustee must ensure that time billed for a task undertaken in conducting an administration is charged at the appropriate rate for the level of staff who would be reasonably expected to undertake the task.

2.16        Records

                The trustee must ensure that proper records are kept that:

                (a)    provide evidence of the time spent on work done in conducting an administration; and

               (b)    adequately describe the nature of the work; and

                (c)    state whether the trustee has had to recover moneys under subsection 161B (2) of the Act.

Division 2.5    Files and access to information

2.17        File maintenance

         (1)   The trustee must keep separate files for each administration.

         (2)   The trustee must keep a record of every material decision in an administration, and any supporting documentation relied on in relation to the decision, on the file for the administration.

2.18        Provision of information to creditors

         (1)   This clause applies to:

                (a)    the trustee of a composition or scheme of arrangement under Division 6 of Part IV of the Act; and

               (b)    the trustee of a personal insolvency agreement; and

                (c)    the trustee of the estate of a deceased person.

         (2)   The trustee and the trustee’s staff must give information about an administration to a creditor who reasonably requests it.

Division 2.6    Meetings of creditors

2.19        Need for meeting

                The trustee must consider whether the matters sought to be addressed at a meeting of creditors:

                (a)    require the holding of a meeting; or

               (b)    could be addressed more cost effectively by another form of communication with creditors, for example, a creditors’ resolution without a meeting in accordance with section 64ZBA of the Act.

2.20        Matters to be considered when holding a meeting

                In deciding whether the proposed time and place for a meeting of creditors is convenient for the creditors, the trustee must consider the following:

                (a)    the requirements for meetings set out in the Act and these Regulations;

               (b)    the location of creditors;

                (c)    the ability of creditors to return proxies and statements of debt;

               (d)    the complexity of issues to be considered by creditors before the meeting.

2.21        Attendance at meeting

                The trustee, or a person appointed under subsection 63B (1) of the Act to represent the trustee at a meeting of creditors, must attend the meeting.

2.22        President’s duties at creditors’ meeting

         (1)   This clause applies to the following persons:

                (a)    a trustee who is elected to preside at a meeting of creditors;

               (b)    a person appointed under subsection 63B (1) of the Act to represent the trustee at a meeting of creditors;

                (c)    a controlling trustee presiding at a meeting of creditors.

         (2)   The person must:

                (a)    ensure that proper meeting procedures are followed; and

               (b)    ensure that the requirements relating to meetings set out in the Act and these Regulations are complied with; and

                (c)    ensure that all persons attending the meeting who are entitled to ask questions of the trustee, the bankrupt, the debtor or the legal personal representative of the deceased person are given an opportunity to do so; and

               (d)    ensure that the minutes secretary complies with the requirements of section 64Z of the Act; and

                (e)    take reasonable steps to establish whether there is sufficient evidence to support a creditor’s statement under section 64D of the Act in relation to the amount of liability of the bankrupt, the debtor or the estate of the deceased person to the creditor.

2.23        Attendance of Inspector–General at meetings

                The trustee must not prevent the Inspector-General from attending, or participating in, a meeting of creditors.

Division 2.7    Trustee’s accounts

2.24        Records of accounts

         (1)   The trustee must maintain a separate record of receipts and payments for each administration.

         (2)   If a single bank account is kept for 2 or more administrations, the trustee must collectively reconcile the records for the individual administrations with the bank records each month.

2.25        Verifying payments and transfers

                The trustee must verify all payments from an administration, and transfers between estates, by reference to appropriate supporting vouchers and original documents kept on the administration file.

2.26        Cash book

                The trustee must regularly reconcile the cash book for an administration with the bank records for the administration, in accordance with the amount of activity in relation to the administration.

Part 3          Standards for trustees other than controlling trustees

Division 3.1    Application

3.1           Application of Part 3

                This Part applies to:

                (a)    the trustee of the estate of a bankrupt; and

               (b)    the trustee of a personal insolvency agreement; and

                (c)    the trustee of the estate of a deceased person.

Division 3.2    Reporting to creditors

3.2           Notification of administration

                The notice given by the trustee to the creditors of a bankrupt, debtor or deceased person must include the following information:

                (a)    the name, date of birth, address and occupation of the bankrupt, debtor or legal personal representative of the deceased person;

               (b)    the business name or name of any associated entity or related entity of the bankrupt, debtor or deceased person;

                (c)    the date and type of administration;

               (d)    an outline of matters investigated by the trustee up to the date of the notification;

                (e)    advice about any possible contributions liability of the bankrupt;

                (f)    any matters the trustee has identified as needing further investigation.

Division 3.3    Creditors’ claims

3.3           Provable debts in a joint administration

                In conducting an administration in relation to joint bankrupts or debtors, the trustee must ensure that a debt is proved in the appropriate estate.

3.4           Evidence relating to proof of debt

                The trustee must ensure that each creditor’s claim or proof of debt in relation to an administration bears evidence of:

                (a)    its admission or rejection; and

               (b)    the reason for its admission or rejection; and

                (c)    the amount for which the claim or proof of debt has been admitted.

3.5           Evidence of liability for debt

         (1)   If necessary, the trustee must ask a creditor to give evidence in writing in relation to a debt claimed by the creditor:

                (a)    to establish the liability of a bankrupt, a debtor or the estate of a deceased person for the debt; or

               (b)    to identify the estate or property against which the claim should be admitted.

         (2)   If the trustee considers that evidence given under subclause (1) is insufficient for the purposes of paragraph (1) (a) or (b), the trustee, before asking for further information, must have regard to the expected dividend rate and the materiality of the issue requiring clarification.

         (3)   The trustee must keep a copy of any evidence or information relied on in deciding, for the purposes of voting or distributing dividends, whether to accept or reject the creditor’s claim.

Division 3.4    Distribution of dividends

3.6           Creditors’ views to be considered

                The trustee must consider the views of creditors in relation to whether moneys held by the trustee should be:

                (a)    applied to conduct further investigations in relation to the administration; or

               (b)    distributed as a dividend.

3.7           Distribution of estate funds

         (1)   The trustee must distribute estate funds in a timely manner, having regard to:

                (a)    the complexity of the administration and the claims of creditors; and

               (b)    the amount of funds available for distribution; and

                (c)    the need to retain funds in the estate or property to meet existing or expected commitments.

         (2)   The trustee must make an interim distribution of dividends to creditors unless an existing or expected commitment is likely to account for a significant level of the available funds from the estate or property.

3.8           Advice relating to dividends and administration

                The trustee must, when distributing dividends to the creditors of a bankrupt, a debtor or the estate of a deceased person, advise creditors about whether:

                (a)    further dividends are expected to be distributed; or

               (b)    the administration is finalised.

3.9           Records

                The trustee must keep a record of the following information for each administration:

                (a)    the name of each creditor who received a dividend;

               (b)    the amount of each admitted claim;

                (c)    the amount of dividend paid to each creditor.

Part 4          Standards for trustees of bankrupt estates

Division 4.1    Application

4.1           Application of Part 4

                This Part applies to:

                (a)    the trustee of the estate of a bankrupt; and

               (b)    the trustee of the estate of a deceased person.

Division 4.2    Assets

4.2           Identifying assets for vesting

                The trustee must take appropriate steps to identify the assets of the estate of a bankrupt or deceased person that will vest in the trustee, including the following:

                (a)    obtaining and reviewing the statement of affairs of the bankrupt or deceased person;

               (b)    considering the size of the deficiency in the estate for the purpose of finding possible assets or determining whether an issue needs to be investigated;

                (c)    considering the activities and circumstances of the bankrupt or deceased person to decide whether assets disclosed by the bankrupt or the legal representative of the deceased person are consistent with what would be expected of a bankrupt having a similar background or undertaking a similar activity;

               (d)    if the bankrupt is or was, or the deceased person was, involved in significant corporate or trust activity — making inquiries of third parties (for example, solicitors, accountants, creditors, associated entities and financial institutions) to establish whether there is any divisible property or antecedent transactions.

4.3           Protecting certain assets

                The trustee must take appropriate steps to protect assets with a commercial value that have vested in him or her, including doing any or all of the following:

                (a)    ensuring that the assets are adequately insured;

               (b)    taking possession of the assets;

                (c)    perfecting legal ownership of the assets.

Division 4.3    Contributions

4.4           Application of Division 4.3

                This Division applies to the trustee of the estate of a bankrupt.

4.5           Income and contribution assessment

         (1)   The trustee must, as soon as possible after all necessary information has been made available, make an assessment of:

                (a)    the income of a bankrupt in respect of a contribution assessment period; and

               (b)    the contribution that the bankrupt is liable to pay.

         (2)   The trustee must:

                (a)    act fairly and reasonably in determining the time for payment of contributions liability; and

               (b)    if full payment within the contribution assessment period or before discharge would cause hardship to the bankrupt, consider giving the bankrupt an extension of the time for payment of contributions liability.

         (3)   The trustee must give the bankrupt a copy of the assessment of income and contributions liability, setting out and explaining the basis on which the amount of any contributions liability has been calculated.

4.6           Monitoring payment of contributions

                The trustee must:

                (a)    monitor the payment of contributions by a bankrupt to ensure the contributions liability is discharged; and

               (b)    if necessary, take appropriate steps to recover contributions that remain unpaid after the time for payment has passed.

Part 5          Standards for controlling trustees

5.1           Application of Part 5

                This Part applies to a controlling trustee.

5.2           Notification of administration

                The notice given by the controlling trustee to the creditors of the debtor must include the debtor’s name, date of birth, address and occupation.

5.3           Investigating debtor’s property and income

         (1)   As soon as practicable after an authority under section 188 of the Act becomes effective, the controlling trustee must conduct appropriate investigations of the debtor’s property and income.

         (2)   If the debtor’s property includes significant real estate, company structures or motor vehicles, the controlling trustee must:

                (a)    search the appropriate registries for information about the property; and

               (b)    obtain advice from an independent expert about the value of the property.

         (3)   If the debtor was or is involved in significant corporate or trust activity, the controlling trustee must take appropriate steps to identify the assets of the debtor that will be subject to the personal insolvency agreement, including making inquiries of third parties (for example, solicitors, accountants, creditors, associated entities and financial institutions) to establish whether there is any divisible property or antecedent transactions.

5.4           Report to creditors

                The controlling trustee’s report under section 189A of the Act must also include the following:

                (a)    information about each matter mentioned in subsection 188A (2) of the Act;

               (b)    the basis on which the debtor’s property has been valued;

                (c)    the kind of investigations the controlling trustee has carried out and whether any other matters need to be investigated;

               (d)    the reasons for the controlling trustee’s opinion about whether creditors’ interests would be better served by accepting the debtor’s proposal for dealing with the debtor’s affairs under Part X of the Act or by the bankruptcy of the debtor.

5.5           Records

                The controlling trustee must ensure that:

                (a)    bank accounts maintained in accordance with sections 168 and 169 of the Act; and

               (b)    records maintained in accordance with section 173 of the Act in respect of all transactions relating to the debtor’s property;

are kept separate from records relating to any later administration that takes place in relation to the debtor.

5.6           Voting at creditors’ meeting

                In deciding whether a creditor is entitled to vote at a meeting of creditors, the controlling trustee must:

                (a)    have regard to the merits of the creditor’s claim; and

               (b)    act impartially and independently, without regard to the debtor’s wishes.

[20]         Schedule 6

substitute

Schedule 6        Modifications in relation to Part X of the Act

(regulations 10.01, 10.05, 10.07, 10.08 and 10.13)

Part 1          Modifications of Part X of the Act — joint debtors

1              Section 187A

omit

This Part

insert

         (1)   This Part

2              Section 187A

insert

         (2)   In the application of this Part (other than subsection 187 (1A)) to joint debtors, whether partners or not, an expression specified in one of the following rules of interpretation applies to the extent that the context reasonably permits:

                (a)    ‘a debtor’ is to be read as ‘joint debtors’;

               (b)    ‘the debtor’ is to be read as ‘the joint debtors’;

                (c)    ‘the debtor’s’ is to be read as ‘the joint debtors’;

               (d)    if used in relation to a debtor:

                          (i)    ‘he or she’ is to be read as ‘they’; and

                         (ii)    ‘his or her’ is to be read as ‘their’; and

                        (iii)    ‘him or her’ is to be read as ‘them’; and

                        (iv)    a noun or verb in the singular form is to be read as being in the plural form.

         (3)   Subsection (2) applies, subject to any specific modifications of this Part by the Bankruptcy Regulations 1996.

         (4)   To the extent that the context reasonably permits, a reference (by operation of subsection (2)) to joint debtors includes a reference to any of the joint debtors.

         (5)   A reference to the affairs, or examinable affairs, of a debtor includes a reference to the separate affairs, or separate examinable affairs, of a joint debtor.

3              Subsection 188 (1)

omit

A debtor

insert

If each joint debtor is a person

4              Subsection 188 (1)

before

may sign

insert

the joint debtors

5              Subsections 188 (2AA) and (2AB)

omit

the debtor

insert

each joint debtor

6              Subsection 188 (2C)

omit the second occurrence of

the debtor

insert

each joint debtor

7              Subsection 188 (2D)

omit the second occurrence of

the debtor

insert

each joint debtor

8              Subsection 188 (4)

before

debtor

insert

joint

9              Subsection 188 (5)

omit

the District in which the

insert

the District in which each joint

10            Paragraphs 188A (2) (a) and (c)

omit

the debtor’s

insert

each joint debtor’s

11            Paragraph 188A (2) (e)

omit

the debtor

insert

each joint debtor

12            Paragraph 188A (2) (l)

omit

the debtor

insert

each joint debtor

13            Subsection 189AB (1)

omit

         (1)   When the debtor’s property becomes subject to control under this Division, the debtor’s property is charged with:

insert

         (1)   When the property of joint debtors becomes charged under this Division, the charges specified in subsection (1A) are created with respect to:

14            After subsection 189AB (1)

insert

      (1A)   The charges are:

                (a)    a charge over the joint property of the joint debtors; and

               (b)    a separate charge over the separate property of each joint debtor.

15            Subsection 189AB (2)

omit

the charge is not affected

insert

none of the charges is affected

16            Subsections 189AB (3) and (4)

omit

The charge

insert

Each charge

17            Paragraph 189A (1) (a)

substitute

                (a)    summarising and commenting on the information about:

                          (i)    the joint estates of the joint debtors; and

                         (ii)    the separate estate of each joint debtor;

        that is available to the controlling trustee; and

Part 2          Modifications of Division 5 of Part IV of the Act — meetings called under authorities under section 188 of the Act

1              Subsection 63A (1), definition of joint bankruptcy, subparagraph (d) (ii)

omit

jointly.

insert

jointly; or

2              Subsection 63A (1), definition of joint bankruptcy, after paragraph (d)

insert

                (e)    the situation arising out of the signing, by joint debtors for the purposes of section 188, of a joint authority or separate authorities for the administration of their joint estate.

3              Subsection 64A (2)

substitute

         (2)   Notice of a meeting must:

                (a)    be given in a manner specified in the regulations; and

               (b)    be published in:

                          (i)    a national daily newspaper that circulates throughout Australia; and

                         (ii)    a regional daily newspaper of the State or Territory in which the debtor resides.

4              After subsection 64B (5)

insert

         (6)   If the meeting is the first meeting of creditors called under an authority given under section 188, the notice must state that an information sheet about Part X, dealing with the following matters, may be obtained from the Insolvency and Trustee Service Australia:

                (a)    meetings under Part X;

               (b)    controlling trustees;

                (c)    the administration of an authority under section 188;

               (d)    the application of Part X to an authority under section 188;

                (e)    personal insolvency agreements;

                (f)    the rights of creditors under Part X.

5              After paragraph 64D (aa)

insert

              (ab)    whether the creditor, in relation to the debtor, is a related entity; and

6              Paragraph 64G (g)

substitute

               (g)    if the meeting is the first meeting — tabling of the following documents:

                          (i)    the statement of affairs, and the proposal for dealing with them, required by subsection 188 (2C) or (2D);

                         (ii)    the report by the controlling trustee required by section 189A;

                        (iii)    the written statement by the controlling trustee required by section 189B;

7              Section 64P, heading

substitute

64P          Controlling trustee to preside at meeting under section 188

8              Subsections 64P (1) and (2)

substitute

         (1)   Subject to subsection (2), the controlling trustee must preside at a meeting called under an authority under section 188.

         (2)   The creditors and their representatives may:

                (a)    vote to remove the controlling trustee as President; and

               (b)    nominate another person to preside at the meeting.

9              Subsection 64P (6)

omit each mention of

the trustee

insert

the controlling trustee

10            Subsection 64P (7)

omit

the trustee

insert

the controlling trustee

11            Subsection 64R (1)

substitute

         (1)   If the meeting is the first meeting, the President must then request the controlling trustee to lay before the meeting the documents specified in paragraph 64G (g), and the controlling trustee must comply with the request.

12            Subsection 64R (2)

omit

the statement of affairs,

insert

those documents,

13            Subsection 64U (1)

substitute

         (1)   At the first meeting called under an authority under section 188 that is attended by:

                (a)    the controlling trustee; or

               (b)    if the creditors have passed a special resolution under paragraph 204 (1) (b) — the trustee of a personal insolvency agreement;

the President must ask the trustee to state the basis on which he or she wishes to be remunerated.

14            Before subsection 64Y (1)

insert

      (1A)   The controlling trustee may adjourn a meeting to undertake further investigations, in relation to the controlling trusteeship, that the controlling trustee considers necessary.

      (1B)   The creditors attending the meeting may, by special resolution, revoke the trustee’s decision to adjourn the meeting.

15            After subsection 64ZC (5)

insert

      (5A)   An instrument appointing a proxy must include a statement:

                (a)    disclosing whether or not the proxy has received a financial incentive to vote in a particular way:

                          (i)    on a particular matter or matters that may arise at the meeting; or

                         (ii)    on a particular motion or motions that may be proposed at the meeting; and

               (b)    including information to the effect that it is an offence, under subsection 263C (1), to give the trustee a voting document knowing or reckless that the document is false or misleading in a material particular.

16            After subsection 64ZE (2)

insert

         (3)   This section applies in relation to a personal insolvency agreement only if:

                (a)    a joint estate forms part of the property that is to be dealt with under the agreement; and

               (b)    the agreement does not specifically provide for distribution of the joint estate.

Part 3          Modifications of Part VIII of the Act  — controlling trustees and trustees of personal insolvency agreements

1              Before Part VIII, Division 1

insert in Part VIII

Division 1A             Interpretation

154AA    Interpretation

                In this Part, in its application to Part X, a reference to a registered trustee includes a reference to a controlling trustee and a trustee of a personal insolvency agreement.

2              Section 156A

omit

3              Subsection 157 (1)

substitute

         (1)   If:

                (a)    the Official Trustee is:

                          (i)    under section 188 or 192, the controlling trustee in relation to a debtor; or

                         (ii)    under Part X, the trustee of a personal insolvency agreement; and

               (b)    the creditors wish to appoint, in place of the Official Trustee:

                          (i)    a registered trustee or a solicitor as the controlling trustee; or

                         (ii)    a registered trustee as the trustee of the personal insolvency agreement;

the creditors may do so by resolution at a meeting of creditors.

4              Section 158

substitute

158          Appointment of more than 1 controlling trustee

                The creditors may appoint 2 or more controlling trustees jointly, or jointly and severally.

5              Section 159

omit

6              Section 160

substitute

160          Vacancy in position of trustee — Official Trustee to act

                If at any time there is no controlling trustee in relation to a debtor, or no trustee of a personal insolvency agreement under Part X, the Official Trustee is to act as the trustee.

7              After subsection 161 (1)

insert

      (1A)   This section does not apply in relation to a trustee of a personal insolvency agreement.

8              Subsection 173 (1)

substitute

         (1)   A controlling trustee who has consented to exercise powers given by an authority under section 188 must keep such accounts and records as are necessary to exhibit a full and correct account of the debtor’s affairs and must permit a creditor:

                (a)    to inspect, at all reasonable times, either personally or by an agent, the accounts and records relating to the controlling trusteeship; and

               (b)    to take a copy of those accounts and records.

Penalty:   5 penalty units.

9              Section 180

omit

trustee of an estate.

insert

trustee, other than controlling trustee, under Part X.

10            Section 181

substitute

181          Removal of trustee

                The creditors may, by resolution, at a meeting of which at least 7 days notice has been given, remove a controlling trustee or the trustee of a personal insolvency agreement and may, at that meeting or a later meeting, appoint another trustee to replace the removed trustee.

11            Subsection 181A (1)

substitute

         (1)   The current controlling trustee or the current trustee of a personal insolvency agreement may, with the written consent of another trustee (either a registered trustee or the Official Trustee), nominate the other trustee as the new trustee.

12            Subsection 181A (4)

substitute

         (4)   If no creditor lodges a written notice of objection with the current trustee at least 2 days before the specified date, the new trustee replaces the current trustee on the date specified in the notice.

Part 4          Modifications of Division 1 of Part V of the Act — debtors whose property is subject to control under Division 2 of Part X of the Act

1              Section 77F

substitute

77F          Allowances and expenses to be paid out of debtor’s property subject to control under Division 2 of Part X

                If the evidence that a person gives, or the books that a person produces, under section 77C, relate to matters concerning the property of a debtor that is subject to control under Division 2 of Part X, any amount payable to the person under section 77D or 77E is to be paid out of that property.

2              Subsection 81 (1)

substitute

         (1)   Where a person (in this section called the relevant person) becomes a debtor whose property is subject to control under Division 2 of Part X, the Court or a Registrar may at any time (whether before or after control over that property has ended), on the application of:

                (a)    a person (in this section called a creditor) who has or had a debt that would be provable if the debtor were a bankrupt;

               (b)    the controlling trustee; or

                (c)    the Official Receiver;

summon the relevant person for examination in relation to the property that is subject to control under Division 2 of Part X.

Part 5          Modification under subsection 231 (1) of the Act — personal insolvency agreements

1              Section 77F

substitute

77F          Allowances and expenses to be paid out of debtor’s property subject to personal insolvency agreement

                If the evidence that a person gives, or the books that a person produces, under section 77C, relate to matters concerning the property of a debtor that is subject to a personal insolvency agreement, any amount payable to the person under section 77D or 77E is to be paid out of that property.

Part 6          Modifications under subsection 231 (3) of the Act — personal insolvency agreements

1              Subsection 113 (1)

omit

presentation of a petition on which, or by virtue of the presentation of which, a person became a bankrupt,

insert

making of a sequestration order,

2              Subsection 113 (1)

omit

or, in the case of a debtor’s petition, the presentation of the petition

3              After subsection 133 (13)

insert

       (14)   This section does not apply in relation to a personal insolvency agreement.

4              After paragraph 134 (1) (b)

insert

              (ba)    carry on a business of the debtor in accordance with an authorisation given under subsection (5);

5              After subsection 134 (4)

insert

         (5)   If a personal insolvency agreement provides for the business of the debtor to be assigned to the trustee, the agreement may:

                (a)    authorise the trustee to carry on a business of a debtor; and

               (b)    specify the period during which, and the conditions (if any) subject to which, the trustee may carry on the business.

         (6)   The creditors may vary or terminate an authority under subsection (5) by passing a special resolution to that effect at a meeting called for the purpose.

         (7)   This section extends only in relation to property of the debtor that is subject to the personal insolvency agreement.

6              Subsection 136 (1)

omit

                Where any property of the bankrupt is subject to a mortgage,

insert

                Where any property of the debtor that is subject to the personal insolvency agreement is also subject to a mortgage,

7              Subsection 137 (1)

omit

                Where goods of a bankrupt

insert

                Where goods of a debtor that are subject to a personal insolvency agreement

8              Paragraphs 138 (1) (a) and (b)

substitute

                (a)    the property of a debtor that is subject to a personal insolvency agreement includes rights in respect of industrial property; and

               (b)    the debtor is liable to pay royalties or a share of profits to a person in respect of those rights;

9              Paragraph 138 (1) (c)

omit

the bankrupt;

insert

the debtor;

10            Paragraph 138 (1) (d)

omit

the bankrupt

insert

the debtor

11            Paragraphs 139 (1) (a) and (b)

substitute

                (a)    the trustee has seized or disposed of any goods in the possession or on the premises of a debtor that are subject to a personal insolvency agreement without notice of any claim by any person in respect of those goods; and

               (b)    the goods were not, at the date of execution of the personal insolvency agreement, the property of the debtor;

12            Subsection 139 (2)

omit everything after

in respect of property

insert

that is subject to the personal insolvency agreement, being rates, land tax or municipal or other statutory charges that fall due on or after the date of execution of the personal insolvency agreement, except to the extent, if any, of the rents and profits received by the trustee in respect of that property on or after the date of execution of the personal insolvency agreement.

13            Subsection 139 (3)

substitute

         (3)   Where the trustee of a personal insolvency agreement carries on a business previously carried on by the debtor, the trustee is not personally liable for any payment in respect of long service leave or extended leave:

                (a)    for which the debtor was liable; or

               (b)    to which a person employed by the trustee in his or her capacity as trustee of the personal insolvency agreement, or the legal personal representative of such a person, becomes entitled after the date of execution of the personal insolvency agreement.

14            Subsection 139 (4)

omit

trustee of the estate of a bankrupt

insert

trustee of a personal insolvency agreement

15            Section 139ZJ

omit

In this Subdivision:

insert

         (1)   In this Subdivision:

16            Section 139ZJ

insert

         (2)   In sections 139ZK, 139ZL and 139ZP, a reference to a bankrupt is to be read as a reference to a debtor.

         (3)   In subsection (2):

debtor means a person who has executed a personal insolvency agreement.

17            Paragraphs 139ZK (1) (e) and (f)

omit

bankruptcy,

insert

personal insolvency agreement,

18            Subsection 139ZL (1)

omit everything before paragraph (a), insert

         (1)   If a debtor is liable to pay a specified amount of his or her income to the trustee in accordance with a personal insolvency agreement, the Official Receiver:

19            Subsection 139ZL (1)

omit

make the contribution.

insert

pay that amount.

20            Paragraphs 139ZL (3) (a) and (b)

omit

the contribution

insert

the amount of income

21            Subsection 139ZQ (1)

omit

bankrupt under Division 3,

insert

personal insolvency agreement because of the application of any of sections 120 to 125,

22            Subsection 139ZR (3)

omit

Division 3.

insert

any of sections 120 to 125.

Part 7          Modification under subsection 231 (5) of the Act — trustees of personal insolvency agreements

1              Subsection 173 (1)

substitute

         (1)   The trustee of a personal insolvency agreement must keep such accounts and records as are necessary to exhibit a full and correct account of the administration of the agreement and must permit a creditor of the debtor:

                (a)    to inspect, at all reasonable times, either personally or by an agent, the accounts and records relating to the personal insolvency agreement; and

               (b)    to take a copy of those accounts and records.

Penalty:   5 penalty units.

[21]         Schedule 8, after item 7

insert

 

7A

Section 76B

 

record of the termination or setting aside of a composition or scheme of arrangement

copy of record

trustee

immediately

·   date of termination or setting aside

[22]         Schedule 8, item 15, column 5

omit

7 days

insert

2 days

[23]         Schedule 8, item 16, column 3

omit

(subsection 154A (2))

[24]         Schedule 8, item 17, column 2

omit

Section 154C

insert

Section 155C

[25]         Schedule 8, item 17, column 3

omit

(subsection 154A (2))

insert

(subsection 155C (2))

[26]         Schedule 8, item 23, column 5

omit

 

7 days (Order 77, rule 45, Federal Court Rules)

insert

 

2 days (Order 77, rule 52, Federal Court Rules)

[27]         Schedule 8, item 24

substitute

 

24

Section 188 and subsection 189 (1B)

 

authority to be controlling trustee (personal insolvency agreement);

 

notice of event causing end of control by trustee

authority (subsection 188 (1));

 

 

 

 

 

 

 

 

notice

(subsection 189 (1B))

registered trustee or solicitor (subsection 188 (5);

subsection 189 (1B))

authority:

2 working days of consent to act;

 

 

 

 

 

 

notice:

7 days after becoming aware that control has ended

·  date of authority

·  date of filing of statement of affairs

·  name of controlling trustee

·  particulars of debtor

 

·  date of termination of control

[28]         Schedule 8, item 25

substitute

 

25

Section 204 and subsection 218 (1)

 

personal insolvency agreement

copy of agreement (paragraph 218 (1) (b))

trustee (paragraph 218 (1) (b))

within 21 days after executing agreement

·  date of execution of agreement

·  particulars of debtor (if different from particulars in section 188 authority)

·  name of each nominated trustee of the agreement (subsection 204 (3); see also section 215A)

·  date of filing of statement of affairs

[29]         Schedule 8, item 26, column 5

omit

7 days

insert

2 days

[30]         Schedule 8, items 27, 27A and 28

substitute

 

27

Subsection 222 (10)

 

sequestration order against estate of debtor

sequestration order

applicant for sequestra-tion order

2 days

(regulation 10.11)

·   date of order

·   particulars of debtor

28

Section 222A

 

termination of personal insolvency agreement by trustee

copy of written notice of termination

(regulation 10.12)

trustee of the agreement

immediately

(regulation 10.12)

·   date of termination

28A

Subsection 222C (5)

 

sequestration order against estate of debtor

sequestration order

applicant for sequestra-tion order

2 days

(regulation 10.11)

·   date of order

·   particulars of debtor

28B

Subsections 224A (1) and (3)

 

terminating personal insolvency agreement by creditors or event specified in agreement

copy of resolution or special resolution (subsection 224A (1));

written notice (subsection 224A (3))

trustee (subsections 224A (1) and (3))

immediately (subsections 224A (1) and (3))

·   date of termination

28C

Subsection 224A (4)

 

court order setting aside or terminating a personal insolvency agreement

written notice

registered trustee

2 days (Order 77, rule 58, Federal Court Rules)

·  date when agreement set aside or terminated

[31]         Schedule 8, items 30 and 32, column 5

omit

 

7 days (Order 77, rule 45, Federal Court Rules)

insert

 

2 days (Order 77, rule 61, Federal Court Rules)

[32]         Schedule 9, item 1

substitute

1

For the filing, under paragraph 218 (1) (b) of the Act, of a copy of a personal insolvency agreement entered into under Part X of the Act

$300.00

Notes

1.       These Regulations amend Statutory Rules 1996 No. 263, as amended by 1996 No. 278; 1997 Nos. 76 and 325; 2000 Nos. 140 and 220; 2001 No. 262; 2002 No. 255; 2003 No. 76.

2.       Notified in the Commonwealth of Australia Gazette on 26 August 2004.