Your questions answered

In January, we asked you to consider sending us questions about regulation and the role of AFSA. We’ve answered some of your questions below.

Question: Taking into consideration that Section 139ZG(3) provides that the unpaid income contributions due to the Trustee of the first bankruptcy “…is recoverable by the trustee as a debt due to the estate of the bankrupt…” then is the unpaid income contribution part of the Trustee of the First Bankruptcy Claim “ a debt proved in the earlier bankruptcy…”  in the later bankruptcy pursuant to Section 59(1)(c)?

Answer: If a bankrupt owes income contributions and becomes bankrupt a second time with an outstanding liability for contributions from the first bankruptcy,  the trustee in the first bankruptcy can prove for the contributions in the later bankruptcy, i.e. they are provable.

Question: How does a Trustee deal with potential tensions between the Privacy Act and the right of creditors to review Bankruptcy files and request documents?

Answer: Creditors have always had the right to inspect the files of trustees. Former s173 gave this right, and now s70-10 of Schedule 2 gives this right, although this right would be (and has been) subject to the restrictions under the Privacy Act 1988.

If a creditor wants to inspect a file, any personal information about the bankrupt (or indeed any other individuals) needs to be protected from view unless the individual to whom the information relates has consented to it being viewed, or one of the other circumstances in which disclosure of personal information is permitted under Australian privacy Principle 6 exists.

This means that preparing the file for inspection may be a time consuming exercise.

Guidance as to what information can be provided to and withheld from creditors is provided by the Insolvency Practice Rules at 70-10.

The Privacy Act 1988 and the Australian Privacy Principles govern the use of private information. The Bankruptcy Act 1966 does not override the principles and Australian Privacy Principle 6 provides guidance about personal information.

Question: Since the introduction of the online bankruptcy form, what information has AFSA provided to registered trustees seeking a SOAs on creditors petition as to:

  • How to notify a bankrupt of the obligation to electronically file a SOA?

If you are administering estates where no Statement of Affairs has been filed and would like to alert your bankrupt clients to the new Bankruptcy Form, please contact us for a list of these estates at registry [at]

  • Notifying the bankrupt how to access the form since it can no longer be mailed?

If the person applying for bankruptcy doesn’t have access to a computer or the internet, they can call AFSA’s national service centre on 1300 364 785 and ask for the Bankruptcy Form to be posted to them.

  • What is sufficient notice for Section 54?

Sufficient notice for acceptance of a section 54(1) referral is evidence that the bankrupt has been informed of their obligation to file a Statement of Affairs with the Official Receiver. This can include an Affidavit detailing the personal service of documents on the intended recipient, an Australia Post Delivery Confirmation Advice Receipt signed by the intended recipient, case notes detailing a conversation or meeting with the bankrupt acknowledging receipt of correspondence or ordinary post followed by a phone call to confirm receipt and understanding can be considered sufficient notification.

  • What constitutes proof of notice for offence referral and/or requesting a s77CA Notice?

In relation to proof of service for an offence referral and/or a request for a 77CA Notice, the above also applies. Nothing has changed in terms of proof of notice for the purposes of applying for a s77CA and trustees should refer to Official Receiver Practice Statement 7 – Official Receiver Notices

These Q&As do not constitute legal advice. You should seek your own professional advice to find out how any applicable laws apply to you, because it is your responsibility to determine your obligations.