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Bankruptcy
10. The Bankruptcy Act 1966 (Cth) exempts certain property of the bankrupt from
sequestration. Which of the following assets of Lee, a bankrupt, is property
exempt from payment of debts? (ABL ¶13-710)
11. Are there any questions arising from the insurance law material that need
attention?
Problem Questions
a) A fails to comply with a bankruptcy notice within the time on the notice.
b) B leaves Australia suddenly to help a sick relative overseas. Six months later,
the relative has passed away, but D has not yet returned. (ABL ¶13-590)
c) On the advice of his physiotherapist, C goes on a three-month holiday to
escape from back pain brought on by the stress of the pressure of business
creditors.
d) P sues D for $1,500 and gets judgment against D. D refuses to pay, so P then
obtains a writ of execution against D. The sheriff is unable to find D to serve
the writ on her, and returns the writ to the Sheriff’s Office.
2. Over the past two years Frank has experienced financial difficulty and he is
currently being pursued by creditors. Frank owes $809,000 to 10 different creditors
and the total debt is comprised of secured and unsecured creditors. As a
consequence of his unmanageable financial situation, Frank has decided to petition
for bankruptcy. Between the date of his petition and the date his petition is accepted
by the Federal Court, he sells his camper van valued at $20,000 to Linda his
girlfriend for $5,000. Further, Frank gives away his boat to Leo his friend and pays
off his own a personal loan owed to his long standing family member Jessica, valued
at $20,000. In addition, in order to preserve property of sentimental value he leaves
these low value assets with his Father. You are required to identify the legal issues
arising from this scenario in bankruptcy. Where relevant you should justify and
support your answers with reference to statute and/or case law