The High Court has postponed a bankrupt man’s discharge until midnight on 16 February 2027, extending his bankruptcy to seven years from the date he was adjudicated bankrupt.
In a judgment delivered on 30 September 2021, Mr Justice Humphreys said the extension was warranted because the man had not provided required financial information during the normal one-year bankruptcy period. The judge gave credit for his later cooperation by setting the extension at seven years rather than the eight years sought by the Official Assignee.
The man was adjudicated bankrupt on 17 February 2020. The Official Assignee sought an extension under section 85A of the Bankruptcy Act 1988, which permits discharge to be postponed in cases of non-cooperation or failure to disclose income or assets. The court had already granted an interim extension in February 2021. The judgment addressed the outstanding request for a final extension.
The judgment records that the bankrupt did not provide a statement of personal information, statement of affairs or income assessment form despite six requests between February and November 2020. After the motion was heard in April 2021, the judge gave him another opportunity to provide information. He delivered a statement of affairs and income assessment form in May, and a statement of personal information in July.
The bankrupt said his former accountant had failed to appeal a VAT assessment despite being instructed to do so. He also relied on his health, including a heart attack in August 2020 and hospitalisation after a car accident in April 2021. The judge said the non-cooperation began before the health problems and that those circumstances did not explain the delay. Complaints against the former accountant could be pursued in separate civil proceedings, the judgment said, but did not remove the obligation to cooperate after adjudication.
The bankrupt also argued that the extension involved double jeopardy and submitted that section 85A(4) might be unconstitutional. The judge rejected the double-jeopardy argument, finding that an extension was a civil consequence of indebtedness and failure to cooperate, not a criminal or administrative penalty. He said he could not address the constitutional submission without notice to the Attorney General.
The order postpones discharge to the seventh anniversary of the adjudication order. The judgment gives that date as midnight on 16 February 2027.