Nick Cooper
Principal – Oracle Insolvency Services
Suhren v Cooper (Trustee) [2025] FCA 251
Case Summary
On the 10th of March 2025, the Federal Court of Australia handed down their judgment on a bankrupt party’s application to review the trustee’s decision to refuse him permission to travel overseas. The bankrupt’s application was dismissed as the Court wasn’t satisfied that the proposed travel was genuine.
The relevant legislation, positions of the parties, and Court’s findings will be discussed below.
Background:
The bankrupt party, Frederik Suhren (Applicant), who is an undischarged bankrupt, sought orders from the Court directing the respondent to give consent pursuant to s. 272(1)(c) of the Bankruptcy Act 1966 (Cth) (Act) to allow him the leave Australia from the 10th – 24th of March 2025. Nick Cooper (Respondent), Oracle’s Managing Partner, acted in this matter in his capacity as the Trustee over the Applicant’s estate.
Under s.272(1)(c) of the Act, if an undischarged bankrupt leaves Australia, or does an act preparatory to leaving Australia without the consent in writing of the trustee of their estate, the bankrupt commits an offence which if convicted, is punishable by imprisonment for a period not exceeding 3 years.
In applications such as these, the Court has broad discretion in deciding whether to grant travel requests for undischarged bankrupts in line with the following considerations:
- the genuineness of the prospered travel;
- the likelihood of return; and
- the impact on administration of the estate[1]
The decision to refuse permission to an undischarged bankrupt requires careful consideration to all relevant circumstances as it affects the freedom of movement of a person, however it is not deemed as a penalty for bankruptcy.[2]
In this matter, the Applicant sought to travel to Texas for an energy conference, followed by London and Equatorial Guinea, stating that the trip was critical for fulfilling contractual obligations, maintaining the employment of his staff, and maintaining client relationships.
Positions of the parties:
The Respondent didn’t contend that the Applicant was at risk of absconding during his travel as he had established ties within his home State. Further, the Respondent also didn’t contend that the administration of the estate would be encumbered, due to the short period of travel.
A primary issue that was discussed by both parties was whether the Applicant complied with his duties under s. 77 of the Act, namely, to give the Respondent all books that are in his possession that relate to any of his examinable affairs, and to give the Respondent such information about any of his conduct and examinable affairs as the Respondent requires.[3]
In line with this, the Respondent submitted that it was up to the Applicant to persuade the Court that his proposed travel is genuine, as there was cause for concern due to the Applicant’s failure to provide the documents and information requested both in relation to his estate and travel plans, demonstrating a poor attitude towards the need for him to comply with his obligations more generally as a bankrupt.
The Respondent relied on four specific allegations that the Applicant failed to provide the documents and information required by s. 77 of the Act, namely:
- The Applicant failed to provide the precise cost of airfares and accommodation in relation to his proposed travel
The Court and council for the Respondent conceded that the Applicant would not know the precise travel arrangements until they were booked and paid for. However, the Court found that the Applicant hadn’t disclosed the flights/proposed means of travel that he intended utilising, or any details of his proposed accommodation, and also gave a lack of details regarding what was to be involved in his plans whilst overseas.
Furthermore, the Court found that the Applicant also failed to disclose that he would receive a “success fee” as part of a business arrangement during his proposed travel. The Court found that this omission was significant as the Applicant would have surely known the relevance of that information in the context of his request that he be permitted to travel overseas. The fact that this information was only provided by the Applicant during cross-examination gave the Court cause for further concern about the genuineness of his proposed travel.
- The Applicant failed to provide copies of financial statements to the Respondent for all companies of which he is a current shareholder
The Applicant’s position on this matter was that he didn’t fail on this count as he never received such documents, and that he requested these documents and had not received them (though didn’t provide evidence of making such requests). The Court didn’t find that the Applicant failed on this obligation as there was no evidence that such financial statements exist.
- The Applicant did not give the Respondent a recent copy of the account statement for his superannuation
The Court found that it was clear that the Applicant had failed on this count, thus failed to comply with his obligations under s. 77(1)(a) and/or s. 77(1)(ba) of the Act.
- The Applicant failed to provide copies of his income tax returns for the years ending on 2022, 2023, and 2024
The Court found that there was conflict in the evidence about the 2022 tax returns and as such, they were unable to make a finding about whether the Applicant failed to provide the Respondent this document. However, the Court found that the Applicant failed to provide his 2023 tax return, and had only recently provided the Respondent with his 2024 tax return when he sought the Respondent’s permission to leave Australia.
The Respondent further submitted that the Applicant had done a preparatory act in contravention of s. 272(1)(c) of the Act when he attempted to travel back in 2023 without the Respondent’s written consent. Namely, in his oral evidence, the Applicant relayed that he had attempted to travel however was stopped at the airport. The Applicant submitted that he believed that he only had to seek permission to travel out of Australia if the Respondent held his passport at the time. He also said that he would not have travelled or have attempted to travel if he knew otherwise.
While the Court didn’t consider this to bear upon the question of the Applicant’s genuineness, the Court noted that the Applicant hadn’t disclosed in his affidavit that he had previously attempted to travel overseas without the Respondent’s consent, however, ultimately didn’t place any weight on the omission of this information in the affidavit.
The judgment:
The Court found that it would not be fitting to exercise their discretionary power to make orders in favour of the Applicant, finding that the following grounds provided that the proposed travel was not genuine:
- The Applicant failed to give full and frank disclosure of the first leg of his proposed travel plans;
- There was a lack of details regarding aspects of the Applicant’s travel plans for London and Equatorial Guinea; and
- The Applicant failed to disclose the business agreement in relation to the proposed “success fee”.
[2] Re Tyndall; Ex parte Official Receiver (1977) 17 ALR 182 at 187 (Deane J).
[3] S. 77(1)(a)(i) and s. 77(1)(ba).
