THE CORPORATIONS LAW

CHAPTER 7 - SECURITIES

PART 7.13 - TITLE TO, AND TRANSFER OF, SECURITIES

Division 2 - Transfer of securities

SECTION 1091A   RIGHTS OF TRUSTEE OF ESTATE OF BANKRUPT SHAREHOLDER  

1091A(1)  [Share vesting in bankrupt's trustee]  

Where:

(a)  because of the Bankruptcy Act 1966, a share in a company, being part of the property of a bankrupt, vests in the trustee of the bankrupt's estate; and

(b)  the bankrupt is the registered holder of that share;

this section applies whether or not the trustee has been registered as the holder of the share.

1091A(2)  [Trustee's entitlement]  

On producing such information as the company's directors properly require, the trustee is entitled to:

(a)  the same dividends and other benefits; and

(b)  the same rights, for example, but without limitation, rights in relation to:

(i) meetings of the company; or

(ii) documents, including notices of such meetings; or

(iii) voting; or

(iv) inspection of the company's records;

as the bankrupt would be entitled to if he or she were not a bankrupt.

1091A(3)  [Trustee's rights]  

The trustee has the same rights:

(a)  to transfer the share; and

(b)  to require a person to do an act or give a consent in connection with completing or registering a transfer of the share;

as the bankrupt would have if he or she were not a bankrupt.

1091A(4)  [Transfer of share]  

If the trustee transfers the share, the transfer is as valid as if the trustee had been registered as the holder of the share when the trustee executed the instrument of transfer.

1091A(5)  [Consent or approval must not be unreasonably withheld]  

A person or body whose consent or approval is required for the transfer of shares in the company must not unreasonably withhold consent or approval for the transfer of the share by the trustee.

1091A(6)  [Contravention not an offence]  

A person who contravenes subsection (5) is not guilty of an offence.

1091A(7)  [Effect of pre-emption provisions]  

If:

(a)  the company's constitution requires:

(i) the share to be offered for purchase to a member of the company; or

(ii) an invitation to buy the share to be issued to such a member; and

(b)  as at the end of a reasonable period after the trustee so offers the share, or so issues such an invitation, no such member has agreed to buy the share from the trustee at a reasonable price;

the trustee may sell and transfer the share to a person other than such a member.

1091A(8)  [Trustee not affected by restrictions on bankrupt shareholder]  

A provision of the company's constitution is void as against the trustee in so far as, apart from this section, it would affect rights attached to the share:

(a)  because the bankrupt is a bankrupt; or

(b)  because of some event that led to the bankrupt becoming, or that indicated that the bankrupt was about to become, or might be about to become, a bankrupt; or

(c)  for reasons including a reason referred to in paragraph (a) or (b).

1091A(9)  [Generality not limited]  

Nothing in this section limits the generality of anything else in it.

1091A(10)  [Company constitution overridden]  

This section has effect despite anything in the company's constitution.