High Court of Australia

The Trustees of the Property of John Daniel Cummins, A Bankrupt v Cummins [2006] HCA 6

227 CLR 278; 80 ALJR 589; 224 ALR 280

7 Mar 2006

Case Number: S286/2005


Gleeson CJ, Gummow, Hayne, Heydon, Crennan JJ


Bankruptcy – Transfer to defeat creditors - Main purpose - Bankrupt transferred interest in matrimonial property to first respondent wife and transferred shares to second respondent - Whether evidence sufficient to permit inference that bankrupt's main purpose in transferring assets was to defeat or delay creditors - Whether main purpose of transfers to protect assets against future professional negligence suits - Whether transfer of assets void against trustee in bankruptcy - Bankruptcy Act 1966 (Cth), s 121(1)(b).

Evidence – Judicial notice - Bankrupt, a Queen's Counsel who maintained two sets of chambers, failed to lodge tax returns for about 45 years - Whether inference should be drawn that bankrupt had a taxable income at a level which gave rise to a liability to pay income tax - Whether income disclosed in later tax returns relevant to establish income from earlier period of time - Whether Australian Taxation Office a creditor of the bankrupt.

Trusts – Resulting trusts - Joint tenancy - Bankrupt and wife purchased land as joint tenants - Purchase money provided in unequal shares - Whether presumption of resulting trust applies such that property beneficially held in proportion to contributions - When appropriate point in time for determination of equitable interests in property - Bankrupt and wife in subsisting matrimonial relationship improved property subsequent to purchase by constructing matrimonial home - Whether evidence sufficient to rebut presumption of resulting trust - Whether transfer was of bankrupt's interest as joint tenant without any adjustment to allow for beneficial tenancy in common in unequal shares.

Bankruptcy Act 1966 (Cth) – ss 6, 121.


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