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Bankruptcy Regulations

Bankruptcy Regulations 1996 excerpt

Reg 6.03 Household property

  1. For the purposes of subparagraph 116 (2) (b) (i) of the Act, household property of the bankrupt specified in this regulation is household property to which subsection 116 (1) of the Act (which deals with property divisible among
    the creditors) does not extend.
  2. Subsection 116 (1) of the Act does not extend to household property (including recreational and sports equipment) that is reasonably necessary for the domestic use of the bankrupt’s household, having regard to current social standards.
  3. In particular (but without limiting by implication the generality of subregulation (2)), subsection 116 (1) of the Act does not extend to property of the following kinds:
    1. in the case of kitchen equipment, cutlery, crockery, foodstuffs, heating equipment, cooling equipment, telephone equipment, fire detectors and extinguishers, anti-burglar devices, bedding, linen, towels and other household effects — that property to the extent that it is reasonably appropriate for the household, having regard to the criteria mentioned in subregulation (4);
    2. sufficient household furniture;
    3. sufficient beds for the members of the household; and
    4. educational, sporting or recreational items (including books) that are wholly or mainly for the use of children or students in the household;
    5. 1 television set
    6. 1 set of stereo equipment
    7. 1 radio;
    8. either:
      1. 1 washing machine and 1 clothes drier; or
      2. 1 combined washing machine and clothes drier;
    9. i. either
      1. 1 refrigerator and 1 freezer; or
      2. 1 combination refrigerator/freezer
    10. 1 generator, if relied on to supply electrical power to the household;
    11. 1 telephone appliance
    12. 1 video recorder
  4. For the purpose of deciding whether property, other than property of a kind mentioned in paragraphs (3) (b) to (l) (both inclusive), is property to which subregulation (2) applies, regard must be had to following criteria:
    1. the number and ages of members of the bankrupt’s household;
    2. any special health or medical needs of any of those members;
    3. any special climatic or other factors (including geographical isolation) of the place where the household residence is located;
    4. whether the property is reasonably necessary for the functioning or servicing of the household as a viable and properly run household;
    5. whether the costs of seizure, storage and sale of the property would be likely to exceed the sale of price of the property;
    6. if paragraph (e) does not apply — whether for any other reason (for example, cost of transport) the sale of the property would be likely to be uneconomical.
  5. The preceding provisions of this regulation do not prevent subsection 116 (1) of the Act from extending to antique items.
  6. For the purposes of subregulation (5), an item is taken to be antique if, and only if, a substantial part of its market value is attributable to its age or historical significance.

Reg 6.03 B

Property divisible among creditors — prescribed amounts

  1. For the purpose of subparagraphs 116 (2) (c) (i) of the Act, the maximum total value of a bankrupt’s property that is for use by the bankrupt in earning income by personal exertion is:
    1. in the case of bankruptcy occurring or continuing in the period commencing on the commencement date and ending at the end of 30 June 1997 — $2,600; or
    2. in the case of a bankruptcy occurring in a financial year commencing on 1 July 1997 or on 1 July of a subsequent year — the amount worked out in accordance with subregulation (2).
  2. For the purposes of subparagraph (1) (b), the applicable amount is:
    1. in the case of the financial year commencing on 1 July 1997 — $2,600 increased in accordance with the CPI rate for the financial year that commenced on 1 July 1996 and rounded down to the nearest multiple of $50; and
    2. in the case of a subsequent financial year – the amount worked out in accordance with this subregulation for the immediately preceding financial year, increased in accordance with the CPI rate for that financial year and rounded down to the nearest multiple of $50.
  3. For the purposes of paragraph 116 (2) (ca) of the Act, the maximum aggregate value of property used by the bankrupt primarily as a means of transport is:
    1. in case of a bankruptcy occurring or continuing in the period commencing on the commencement date and ending at the end of 30 June 1997 — $5,000; or
    2. in case of a bankruptcy occurring in a financial year commencing on 1 July 1997 or on 1 July of a subsequent year — the amounts worked out in accordance with subregulation (4).
  4. For the purpose of subparagraph (3) (b), the applicable amount is:
    1. in the case of the financial year commencing on 1 July 1997 — $5,000 increased in accordance with the CPI rate for the financial year that commenced on 1 July 1996 and rounded down to the nearest multiple of $50; and
    2. in the case of a subsequent financial year — amount worked out in accordance with this subregulation for the immediately preceding financial year, increased in accordance with the CPI rate for that financial year and rounded down to the nearest multiple of $50.
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