Legal Project Management Plan & Checklist
Lawyer's plan for an individual facing bankruptcy in Australia: bankruptcy notices, creditor's petitions, voluntary bankruptcy and the alternatives.
What can a debtor do after being served with a bankruptcy notice?: The debtor must comply within the time fixed for compliance, which for service in Australia is the statutory period after service: 21 days unless a longer period is prescribed (Bankruptcy Act 1966 s 41(2A) and s 5(1)). Failing to comply, without satisfying the Court of a qualifying counter-claim, set-off or cross demand, is an act of bankruptcy (s 40(1)(g)). The debtor can apply to the Court to set the notice aside and for an extension of time (s 41(6A)); an application relying on a counter-claim, set-off or cross demand carries a deemed extension until the Court decides it (s 41(7)).
How does a debtor oppose a creditor's petition?: At least 3 days before the hearing, or with leave at the hearing, the debtor must file a notice of appearance (Form B4), a notice stating the grounds of opposition (Form B5) and a supporting affidavit, and serve them on the creditor (Federal Court (Bankruptcy) Rules 2016 r 2.06; the Federal Circuit and Family Court rule is the same). The Court may dismiss the petition if the matters in it, service or the debt are not proved, or if the debtor shows ability to pay debts or other sufficient cause (s 52(2)).
How an individual becomes bankrupt voluntarily in Australia by presenting a debtor's petition and statement of affairs to the Official Receiver.
How a debtor applies to set aside a bankruptcy notice in Australia and stops time running with an extension under s 41(6A) or s 41(7).
How long does bankruptcy last?: A bankrupt is discharged automatically 3 years after the relevant date: for a debtor's petition, the date the Official Receiver accepted it; for a sequestration order, the date the accepted statement of affairs was filed (s 149(1)). An objection to discharge that takes effect extends the bankruptcy to 5 or 8 years depending on the ground (s 149A).
Jurisdiction: The Federal Court of Australia and the Federal Circuit and Family Court of Australia (Division 2) have concurrent jurisdiction in bankruptcy (s 27). A debtor's petition is presented to the Official Receiver, not filed in court (s 55(1)).
The Process at a Glance: Take instructions urgently and check whether a bankruptcy notice or creditor's petition has been served, because both carry short deadlines. Audit debts, assets, income and recent transactions. Compare the options: complying with or setting aside a notice, opposing a petition, a debt agreement, a personal insolvency agreement, or a debtor's petition. Giving the Official Receiver a debt agreement proposal, or signing an authority under s 188, is itself an act of bankruptcy (s 40(1)(ha) and (i)). Give written advice and move to the fork that matches the client's instructions.
Key Legislation: Bankruptcy Act 1966 (Cth) ss 5, 27, 40, 41, 44, 52, 54A, 54B, 55, 58, 149 and 149A. Bankruptcy Regulations 2021 s 10A (statutory minimum of $10,000 in the compilation in force from 1 July 2026). Federal Court (Bankruptcy) Rules 2016 rr 2.04, 2.06, 3.02 and 3.03, and the matching Federal Circuit and Family Court of Australia (Division 2) (Bankruptcy) Rules 2021.
* Disclaimer: We're nobody's lawyer, because we aren't lawyers. You are, so you know better than to take legal advice from an app. We also aren't accountants or dog trainers - just digital spirit guides taking zero liability for any of this. This site exists to gather the collective knowledge of practitioners like you. Verify everything and submit your feedback on the Personal Bankruptcy (Debtor) matter plan to improve the playbook. THIS IS NOT LEGAL ADVICE, it's a request for input.
This legal matter plan provides a structured workflow for Bankruptcy & Insolvency cases, outlining the standard RESTRUCTURING process. Utilize these tracking templates to manage your legal cases efficiently.
| Field | Token | Type | Required | Defined in |
|---|---|---|---|---|
| Matter(4) | ||||
| Matter numberⓘ | matter.matterNumber | text | Required | inheritedmatter-core |
| Matter title | matter.title | text | - | inheritedmatter-core |
| Matter typeⓘ | matter.matterType | text | - | inheritedmatter-core |
| Matter status | matter.status | text | - | inheritedmatter-core |
| Client(1) | ||||
| Client name | matter.clientName | text | Required | inheritedmatter-core |
Conduct initial onboarding, verify identity, clear conflicts, and assess urgent creditor risks.
Got a question about this plan?
Ask in the practitioner Discord - edge cases, rule changes, and jurisdiction-specific nuances, all in one place.
Formally audit all secured and unsecured liabilities and calculate divisible vs exempt assets.
Advise on informal options, Part IX Debt Agreements, Part X Personal Insolvency Agreements, and voluntary bankruptcy.
Finalize strategy selection based on thresholds, clawback risks, and personal/professional impacts.
Deliver formal advice, obtain signed authorization, and transition to specific filings.