BANKRUPTCY ACT 1966
Subject to this section, where a bankrupt is discharged from a bankruptcy, the discharge operates to release him or her from all debts (including secured debts) provable in the bankruptcy, whether or not, in the case of a secured debt, the secured creditor has surrendered his or her security for the benefit of creditors generally.
The operation of this section in relation to accumulated HEC debts and semester debts under the Higher Education Funding Act 1988 is affected by section 106YA of that Act.
(a) release the bankrupt from:
(i) a debt on a recognizance; or
(ii) a debt with which the bankrupt is chargeable at the suit of the sheriff or other public officer on a bail bond entered into for the appearance of a person prosecuted for an offence against a law of the Commonwealth or of a State or Territory of the Commonwealth; or
(aa) release the bankrupt from liability to pay an amount to the trustee under subsection 139ZG(1) ; or
(b) release the bankrupt from a debt incurred by means of fraud or a fraudulent breach of trust to which he or she was a party or a debt of which he or she has obtained forbearance by fraud; or
(c) subject to any order of the Court made under subsection (2A), release the bankrupt from any liability under a maintenance agreement or maintenance order.
A discharged bankrupt remains liable under any pecuniary penalty order because such liabilities are not provable in bankruptcy, see subsection 82(3A).
The Court may order that the discharge of a bankrupt from bankruptcy shall operate to release the bankrupt, to such extent and subject to such conditions as the Court thinks fit, from liability to pay arrears due under a maintenance agreement or maintenance order.
The discharge of a bankrupt from a bankruptcy does not affect the right of a secured creditor, or any person claiming through or under him or her, to realize or otherwise deal with his or her security:
(a) if the secured creditor has not proved in the bankruptcy for any part of the secured debt - for the purpose of obtaining payment of the secured debt; or
(b) if the secured creditor has proved in the bankruptcy for part of the secured debt - for the purpose of obtaining payment of the part of the secured debt for which he or she has not proved in the bankruptcy;
and, for the purposes of enabling the secured creditor or a person claiming through or under him or her so to realize or deal with his or her security, but not otherwise, the secured debt, or the part of the secured debt, as the case may be, shall be deemed not to have been released by the discharge of the bankrupt.153(4) [Limitations on effect of release]
(a) was a partner or a co-trustee with the bankrupt or was jointly bound or had made a joint contract with the bankrupt; or
(b) was surety or in the nature of a surety for the bankrupt. 153(5) [Proceedings deemed valid]
Where a bankrupt has been discharged from a bankruptcy, all proceedings taken in or in respect of the bankruptcy shall be deemed to have been validly taken.
(Omitted by No 12 of 1980, s 75).