Sequestration order (Form B7)

At the hearing of a creditor's petition, the Court requires proof of the matters in the petition, service, and that the debt is still owing, and if satisfied may make a sequestration order against the debtor's estate (Bankruptcy Act 1966 s 52(1)). Rule 4.07 of the Federal Court (Bankruptcy) Rules 2016 says the order must be in accordance with Form B7. The order sequestrates the estate, deals with the petitioning creditor's costs, notes the date of the act of bankruptcy and notes the trustee's consent to act. Orders can be made by a Judge or a Registrar; a Registrar's order can be reviewed by the Court.

When you need it

• You are the applicant creditor preparing a draft sequestration order for the hearing of your creditor's petition (Form B6).
• You are the debtor or a trustee and want to understand an order that has been made.
• The petition itself is presented on Form B6 with supporting affidavits (GPI-1 para 5.5).

1. 1

   Heading

   Fill in the District Registry. The Division is General. Title the matter in the debtor's name and name the applicant creditor and respondent debtor.

2. 2

   Judge or Registrar and order details

   Keep Judge or Registrar, and leave the name, date and place of the order for the Court.

3. 3

   The orders

   The estate of the named debtor is sequestrated under the Bankruptcy Act. Choose whether the applicant creditor's costs are fixed in a stated sum or taxed, and paid from the estate.

4. 4

   Notations

   Insert the date of the act of bankruptcy, and the name of the registered trustee whose consent to act has been filed under section 156A.

5. 5

   Registrar's note

   Keep the note about review only if a Registrar makes the order. Omit it if a Judge does.

• On the day the order is made, the applicant creditor must notify the trustee in writing of the appointment, and within 2 days give a copy of the order to the registered trustee who consented to act (r 4.07(2)).
• The applicant creditor must also give a copy to the Official Receiver within 2 days beginning on the day the order was made (s 52(1A)). Failing to do so is a strict liability offence.
• If the order is not entered when made, the applicant creditor must request entry as soon as practicable under Division 39.4 of the Federal Court Rules 2011 (r 4.07(3)).
• A party may seek review of a Registrar's order by interim application in Form B3 within 21 days after the day the power was exercised (r 2.02(3); FCA Act s 35A(5)).

• Before the hearing, file the affidavits rule 4.06 requires: service, a National Personal Insolvency Index search done no earlier than the day before, and that the debt is still owing.
• A review of a Registrar's sequestration order should be brought promptly. The creditor must prove its entitlement again as at the review hearing (GPI-1 paras 6.8, 6.9).