Can a bankruptcy notice (BN) use pseudonyms? Yes, according to a Federal Court case handed down on Thursday.
Imagine, you receive a notice of an application to make you a bankrupt and all the notice says is:
– your name is LF DB
– the creditors name is Ms S M
– you owe $6.55 million as a result of a final judgment in Court
According to the Federal Court, the BN was valid because:
- The BN complied with the suppression of name orders from the Court.
- Even though it is a fundamental tenant of bankruptcy that the public know the identify of a bankrupt, this is not an issue at the time of the issue of the bankruptcy notice. Instead, the BN is between the creditor and the debtor.
- Only once the BN expires and a sequestration order is sought, may this become an issue.
- LFDB could not be misled about the identity of MSSM, as the parties had been engaged in a significant amount of Australian and NZ litigation over many years.
- Therefore, the way the creditor was named in the bankruptcy notice does not raise issues of public policy.
Not sure I agree with this case, but at least it seems the Court has taken a pragmatic approach, which I always favour.