by Matthew Austin March-01-2017 in Litigation & Dispute Resolution, Commercial & Business
In the case of McFeely v Official Assignee in Bankruptcy [2017] IECA 21 (“McFeely”) the Court of Appeal considered the High Court judgment of Costello J where she had acceded to an application by the Official Assignee in Bankrupty to extend the period of Mr McFeely’s bankrupty on a number of grounds.
The Irish bankruptcy regime has largely been brought in line with the equivalent UK regime with the default period of bankruptcy now set at one year. However, that period can be extended in certain circumstances. In particular the Official Assignee in Bankruptcy, The Trustee in Bankruptcy or a creditor of the bankrupt may, prior to the discharge of a bankrupt from bankruptcy, apply to the Court to object to the discharge from bankruptcy where (a) he or she believes the bankrupt has failed to co-operate with the Official Assignee in the realisation of the assets of the bankrupt or where (b) he or she believes the bankrupt has hidden from or failed to disclose to the Official Assignee income or assets which could be realised for the benefit of the bankrupt’s creditors. If such circumstances are proven then the Court has discretion to extend the period of bankruptcy. In the most serious of cases that period can be extended up to 15 years.
McFeely fell to be decided under the bankrupty regime which preceded the current regime, the adjudication of bankruptcy having been made on 30 July 2012. On hearing the Official Assignee’s application to extend the bankruptcy period Costello J decided that the bankrupty period should be extended for a further period of 4 years and 10 months. This was 2 months short of the maximum period available for an extension. The grounds for the extension were that Mr McFeely had:
- Refused to provide the Official Assignee with his actual address;
- Failed to disclose an interest in 7 residential apartments;
- Failed to disclose an interest in 5 commercial property units.
The appeal of Costello J’s decision to extend Mr McFeely’s bankruptcy was advanced on a number of grounds, many of which were specific to the facts of the particular case. However, in the Court of Appeal Peart J had no hesitation in endorsing the views of Costello J in relation to the evidence before her, and dismissed Mr McFeely’s appeal. Peart J found Mr McFeely to have displayed an “a la carte” attitude to his statutory obligations to fully disclose his assets to the Official Assignee. He concluded by stating as follows:
“I am completely satisfied that it was open on the evidence for the trial judge to conclude that the level of non co-operation is established to the upper end of the spectrum of gravity, and that it was deliberate and on-going. In my view, the trial judge was justified in ordering the extension of 4 years and 10 months, allowing a small deduction of two years on account of the appellant’s age, though she considered also that little if any weight ought to be attached to the age of the bankrupt having regard to the aim of the section, namely ‘not just to deter the individual bankrupt but also to deter others and to protect the public’.”
A full copy of the judgment is available here: http://www.courts.ie/Judgments.nsf/0/4397F93CA42568B6802580C10058C48D
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About the Author
Matthew Austin
Matthew is a partner in the Commercial & Business team and has considerable expertise in a range of practice areas, having acted for Irish and International clients in domestic and multi-jurisdictional issues. Matthew has advised in civil and administrative law disputes and in regulatory and advisory matters including insolvency/restructuring, IP, defamation and media law, competition and consumer protection and data protection.