Commonwealth Consolidated Acts

BANKRUPTCY ACT 1966 - SECT 73

             (1)  Where a bankrupt desires to make a proposal to his or her creditors for:

                     (a)  a composition in satisfaction of his or her debts; or

                     (b)  a scheme of arrangement of his or her affairs;

he or she may lodge with the trustee a proposal in writing signed by him or her setting out the terms of the proposed composition or scheme of arrangement and particulars of any sureties or securities forming part of the proposal.

          (1A)  The trustee must, within 2 working days after receiving the proposal, give a copy of the proposal to the Official Receiver.

Penalty:  5 penalty units.

Note:          See also section 277B (about infringement notices).

          (1B)  For the purposes of subsection (1A), a working day is a day that is not a Saturday, Sunday or public holiday in the place in which the bankrupt resides.

          (1C)  Subsection (1A) is an offence of strict liability.

Note:          For strict liability, see section 6.1 of the Criminal Code .

             (2)  The trustee shall call a meeting of creditors and shall send to each creditor before the meeting a copy of the proposal accompanied by a report on it.

          (2A)  The report must indicate whether the proposal would benefit the bankrupt's creditors generally.

       (2AA)  The report must name each creditor who was identified as a related entity of the bankrupt in the bankrupt's statement of affairs.

          (2B)  The trustee may refuse to call the meeting if the proposal does not make adequate provision for payment to the trustee of accrued fees that:

                     (a)  are owing to the trustee (at the time the proposal is lodged) in respect of the administration of the bankrupt's estate, but are not able to be taken out of the bankrupt's estate; and

                     (b)  have been approved by the creditors before the proposal is considered.

             (3)  The bankrupt may, at the meeting, amend the terms of his or her proposal, but not in a way that reduces any provision for payment to the trustee of fees referred to in subsection (2B).

             (4)  The creditors may, by special resolution, accept the proposal.

             (5)  A creditor who has proved his or her debt may assent to or dissent from the proposal by written notice to that effect delivered to the trustee before the meeting or sent by post to the trustee and received by him or her before the meeting, and in that case the creditor shall, for the purposes of this Division, be deemed to have been present at the meeting and to have voted according to his or her assent or dissent.