We have considered the Scottish, American and Canadian approaches to personal insolvency discharge. Let us finally turn to the position in Australia.[1] As with English and Welsh insolvency law, the discharge provisions provide an extremely important function in Australian insolvency law. As Keay and Murray observe in the Australian context, discharge from bankruptcy “is a fundamental outcome of bankruptcy.”[2] As Duns notes there are “three possible time frames for discharge…early discharge, automatic discharge and late discharge.”[3] Automatic discharge was first introduced into Australia in 1966.[4] Their antipodean cousins across the Tasman sea followed a year later.[5]
The Insolvency and Trustee Service of Australia (ITSA)[6] administer personal insolvency in Australia. As in English and Welsh law the concept of automatic discharge exists in the main Australian regulation, namely the Bankruptcy Act 1966 (as amended). Currently, the minimum length of the bankruptcy period before automatic discharge can occur is three years. This time period is regulated by the Bankruptcy Act 1966 (as amended), s.149.[7] As with the English provisions there is also capacity for the bankrupt to be discharged in a shorter period, i.e. six months from the time of filing of the statements of affairs by way of an application by the trustee for early discharge pursuant to s.149S of the Bankruptcy Act 1966.
In Australian law a bankrupt will be discharged from the legal state of bankruptcy, if they have presented their own petition, automatically after three years and one day after the petition was filed with ITSA. The same time period has to elapse for automatic discharge when a creditor petition for the debtor’s bankruptcy, but the relevant time period starts from the submission of the bankrupt statement of affairs with ITSA. Objections can be made to a bankrupt’s discharge by their trustee. This can cause the late discharge to which Duns refers. Delay in lodging the statement of affairs may also prolong the time period before discharge.
ITSA maintains a personal insolvency database called the National Personal Insolvency Index (NPII). The status of the bankrupt as a discharged bankrupt will stay on this database forever.
[1] On Australian insolvency law generally see: Duns, J. Insolvency Law and Policy. Oxford University Press, Victoria, Melbourne, 2002. See also: Murray, M. Keay’s Insolvency: Personal and Corporate Law and Practice. 5th Edition. Thomson, LawBook Co, PyrMont, NSW, 2005.
[2] See also: Keay, A & Murray, M. Insolvency: Personal and Corporate Law and Practice. 4th Edition. Lawbook Co, Sweet & Maxwell, NSW, 2002, at page 155. Hereafter referred to as Keay & Murray.
[3] Duns, J. Insolvency Law and Policy. Oxford University Press, Victoria, Melbourne, 2002, at page 404.
[6] http://www.itsa.gov.au/
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