Commonwealth Consolidated Acts

BANKRUPTCY ACT 1966 - SECT 185Q

Applying for an order

  (1)   Any of the following persons may apply to the Court for an order terminating a debt agreement:

  (a)   the debtor (or the debtor's personal representative if the debtor has died);

  (b)   a creditor of the debtor;

  (c)   the Official Receiver.

Simultaneous application for a sequestration order

  (2)   A creditor may include an application for a sequestration order in an application for an order terminating a debt agreement.

Effect of applying for a sequestration order

  (3)   For the purposes of this Act, making an application for a sequestration order under subsection   (2) is taken to be presenting a creditor's petition against the debtor, but subsection   43(1), sections   44 and 47, subsections   52(1) and (2) and Part   XIA do not apply in relation to the application.

Prerequisites for making an order terminating a debt agreement

  (4)   The Court may make an order terminating a debt agreement if it is satisfied:

  (a)   that the debtor (or the debtor's personal representative if the debtor has died) has failed to carry out a term of the agreement and that it is in the creditors' interest to terminate the agreement; or

  (b)   that carrying out the agreement would cause injustice or undue delay to the creditors or the debtor (or the debtor's estate if the debtor has died); or

  (ba)   that one of the following applies:

  (i)   the administrator of the agreement has contravened subsection   185EC(6) in relation to the relevant debt agreement proposal;

  (ii)   the administrator of the agreement has contravened subsection   185MC(6) in relation to the agreement, whether or not the proposal to vary the agreement was accepted;

  (iii)   the administrator of the agreement has contravened subsection   185PC(6) in relation to the agreement, where the proposal to terminate the agreement was not accepted; or

  (c)   that for any other reason the agreement should be terminated and that it is in the creditors' interest to do so.

Sequestration order

  (5)   If the Court makes an order terminating a debt agreement, the Court may also make a sequestration order if a creditor applied for the sequestration order.