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BANKRUPTCY AMENDMENT ACT 1985 No. 21 of 1985 - SECT 23

Priority payments
23. Section 109 of the Principal Act is amended-

   (a)  by adding at the end of paragraph (1) (a) "and the costs of any audit
        carried out under section 175, not being an audit carried out by the
        Auditor-General";

   (b)  by omitting sub-paragraph (1) (b) (i) and substituting the following
        sub-paragraph:



"(i) if the authority was given to a registered trustee-the remuneration of
the trustee and the costs, charges and expenses properly and reasonably
incurred by the trustee during the period in which the authority is in force,
including any debts incurred by the trustee that are provable in the
bankruptcy;";

   (c)  by omitting paragraph (1) (c) and substituting the following
        paragraph:



"(c) third, in the case of a bankruptcy that occurs within 2 months after a
deed of assignment or a deed of arrangement executed by the bankrupt, or a
composition or scheme of arrangement accepted by the bankrupt's creditors, has
(including at a time before the commencement of this paragraph) been declared
to be void or been annulled, set aside or terminated, in payment of
liabilities, commitments, expenses or remuneration referred to in section
114;";
(d) by inserting in paragraph (1) (e) "extended leave," after "long service
leave,";

   (e)  by omitting paragraph (1) (f) and substituting the following
        paragraph:



"(f) sixth, in payment of all amounts due in respect of compensation payable
under any law of the Commonwealth or of a State or Territory relating to
workers compensation, being compensation the liability for which accrued
before the date of the bankruptcy;";
(f) by inserting in paragraph (1) (g) "extended leave," after "long service
leave,";

   (g)  by omitting from sub-section (6) "of the Commonwealth that provides
        for compensation for personal injury arising out of, or in the course
        of, employment" and substituting "that provides for workers
        compensation";

   (h)  by inserting after sub-section (6) the following sub-section:



"(6A) Where compensation payable under a law relating to workers compensation
is payable by way of periodical payments, the amount of that compensation
shall, for the purposes of paragraph (1) (f), be taken to be the lump sum for
which those periodical payments could, if redeemable, be redeemed under the
law under which those periodical payments are made."; and

   (j)  by omitting sub-section (10) and substituting the following
        sub-section:



"(10) Where in any bankruptcy-

   (a)  property has been recovered, realized or preserved under an indemnity
        for costs of litigation given by a creditor or creditors; or

   (b)  expenses in relation to which a creditor has, or creditors have,
        indemnified a trustee have been recovered,
the Court may, upon the application of the trustee or a creditor, make such
orders as it thinks just and equitable with respect to the distribution of
that property and the amount of those expenses so recovered with a view to
giving the indemnifying creditor or creditors, as the case may be, an
advantage over others in consideration of the risk assumed by creditor or
creditors.".



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