BANKRUPTCY ACT 1966

PART VI - ADMINISTRATION OF PROPERTY  

Division 1 - Proof of debts  

SECTION 102   ADMISSION OR REJECTION OF PROOFS  

102(1)   [Time limitation]  

The trustee shall examine each proof of debt and the grounds of the debt sought to be proved and, subject to the power of the Court to extend the time, shall, not later than 14 days after the expiration of the period specified in the notice of intention to declare a dividend as the period within which creditors may lodge their proofs of debt, either:


(a) admit the proof of debt in whole;


(b) admit it in part and reject it in part;


(c) reject it in whole; or


(d) require further evidence in support of it.

102(2)   [Grounds of rejection given to creditor in writing]  

Where the trustee rejects a proof of debt in whole or in part, he or she shall inform the creditor by whom it was lodged, in writing, of the grounds of the rejection.

102(3)   [Wrongful admission]  

Where the trustee considers that a proof of debt has been wrongly admitted, he or she may:


(a) revoke the decision to admit the proof of debt and reject it in whole; or


(b) amend the decision to admit the proof of debt by increasing or reducing the amount of the admitted debt.

102(4)   [Wrongful rejection]  

Where the trustee considers that a proof of debt has been wrongly rejected in whole, he or she may:


(a) revoke the decision to reject the proof of debt; and


(b) admit the proof of debt in whole or admit the proof of debt in part and reject it in part.

102(5)   [Creditor to be informed etc]  

Where the trustee revokes a decision to admit a proof of debt and rejects it in whole or amends such a decision by reducing the amount of the admitted debt:


(a) he or she shall inform the creditor by whom it was lodged, in writing, of his or her grounds for the revocation or amendment; and


(b) the creditor shall forthwith repay to the trustee any amount received by way of dividend in respect of the proof of debt or any amount received by way of dividend in excess of the amount that the creditor would have been entitled to receive if his or her debt had been originally admitted for the reduced amount, as the case requires.

102(6)   [Creditor ' s entitlement]  

Where the trustee revokes a decision to reject a proof of debt in whole, or amends a decision to admit a proof of debt in part by increasing the amount of the admitted debt, the creditor by whom it was lodged is entitled to be paid, out of available money for the time being in the hands of the trustee, the dividends or additional amounts of dividend, as the case may be, that the creditor would have been entitled to receive if the debt had been originally admitted in whole or for the increased amount, as the case may be, before the available money is applied in the payment of a further dividend, but the creditor is not entitled to disturb the distribution of any dividends declared before the trustee revoked or so amended the decision.




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