(Chancery Division, Sir Terrence Etherton, 10
A Deputy Registrar was wrong to dismiss a
discharged bankrupt’s application for annulment of his bankruptcy on the basis
that his main creditor bank remained unpaid, as the bank had told the trustee
in bankruptcy clearly and unequivocally that it did not intend to prove for its
The Appellant (‘S’) appealed against the decision
of a Registrar not to annul his bankruptcy. He also appealed against the
Registrar’s decision to allow applications made by S’s trustee in bankruptcy
(‘the Trustee’) ruling that the Trustee was to be remunerated on the basis of
time properly spent.
S had five unsecured creditors. Four creditors
proved in the bankruptcy and upon S’s discharge remained unpaid. However, post
discharge the four creditors were paid in full by S. The fifth creditor (‘B’)
was aware that S intended to apply for an annulment. However, it had told S
clearly and unequivocally that it did not intend to prove for its debt. In
those circumstances the debt owed to B was not a relevant consideration when
deciding S’s application for an annulment. Accordingly, the annulment was granted.
With regard to the remuneration application, the
Registrar’s approach was found to be flawed. The principles to be applied were
as stated in Brook v Reed  EWCA
Civ 331,  1 W.L.R. 419 and as contained in Part Five of the Practice
Direction (Ch D: Insolvency Proceedings)  Bus. L.R. 643. Neither
authority had been mentioned by the Registrar and the principles contained in
those authorities had not been given proper weight.
In those circumstances the
Registrar’s decision on the annulment application and the remuneration
application would be set aside and remitted to a different Registrar.