De Facto Property Settlement (Applicant) - Western Australia - Bankruptcy Joinder Track - Concurrent Bankruptcy and Property Settlement

Jurisdiction: Family Court of Western Australia exercising both state family law jurisdiction under the Family Court Act 1997 (WA) and federal bankruptcy jurisdiction under the Bankruptcy Act 1966 (Cth). This concurrent jurisdiction is unique to WA. The bankruptcy trustee is a necessary party and must be joined to the property proceedings.

The Process at a Glance: Identify whether a de facto partner is bankrupt or facing imminent bankruptcy proceedings. Confirm the Family Court's concurrent jurisdiction under s 36 of the Family Court Act 1997 (WA) and obtain the bankruptcy trustee's contact details from the Australian Financial Security Authority (AFSA). Join the bankruptcy trustee as a respondent. Identify the vested property rights of the trustee under the Bankruptcy Act 1966 (Cth) - all divisible property of the bankrupt de facto partner vests in the trustee upon sequestration. Navigate the intersection of Part 5A property adjustment orders and the trustee's property rights. Attend concurrent hearings and pursue a negotiated outcome with both the non-bankrupt partner and the trustee.

Key Legislation and Case Law: Section 36 of the Family Court Act 1997 (WA) - vests bankruptcy jurisdiction in the Family Court of WA for concurrent determination; Bankruptcy Act 1966 (Cth) - s 58 (property vests in trustee on sequestration), s 116 (divisible property), s 120 (undervalue transactions - 5-year clawback for related parties), s 121 (transfers to defeat creditors), s 122 (preferences - 6-month clawback for unrelated parties, 2 years for related parties); Family Court Act 1997 (WA) - s 205ZG (property alteration orders); Re Foots; Jones v Pilcher [2007] QCA 288 - property settlement orders cannot be used to strip assets from creditors. Bankruptcy is a pre-action exemption under Rule 22(2) of the Family Court Rules 2021 (WA).

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