Scribd
Upload
20 views

Tutorial 3

Uploaded by

Ammar Mustaqim
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
20 views

Tutorial 3

Uploaded by

Ammar Mustaqim
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 4

LAW OF INSOLVENCY

AMMAR MUSTAQIM BIN ARIFF HAZNAL


1151100066
L1/T4

TUTORIAL 2
Question 1
Bank Kaya Berhad (‘BKK’) wants to proceed with creditor’s petition against Mr Hutang who
has not complied with the bankruptcy notice served on him by BKK. BKK was instructed by
its solicitors to execute the creditor’s petition and affidavit verifying the petition to enable
them to proceed with the bankruptcy proceedings. The creditor’s petition and affidavit
verifying the petition were executed on 10.3.2020. The creditor’s petition and the verifying
affidavit were filed into court on 14.3.2020 and were then served on you as solicitors for the
debtor, Mr Hutang. You have notified Mr Hutang regarding the creditor’s petition. He now
seeks your advice on the following:
i. Whether the creditor’s petition was properly served on him;
ii. Whether the creditor’s petition was invalid because the verifying petition was
affirmed before the creditor’s petition was presented.
On 1.4.2020, you were informed by Mr. Hutang’s wife that he has passed away. Mr Hutang’s
wife wants to know whether the bankruptcy proceeding will continue. Advice Mr Hutang’s
wife.

Creditor – Bank Kaya Berhad


Mr Hutang – Debtor
Me – Debtor’s solicitor

Situation

 Bankruptcy notice is already served but not complied


 The creditor’s petition and affidavit verifying the petition were executed on 10.3.2020
and filed into court on 14.3.2020
 Mr Hutang passed away on 1.4.2020

Issue
i. Whether the creditor’s petition was properly served on him;
ii. Whether the creditor’s petition was invalid because the verifying petition was
affirmed before the creditor’s petition was presented.
iii. Whether the bankruptcy proceeding will continue after Mr Hutang’s passing away
LAW OF INSOLVENCY
AMMAR MUSTAQIM BIN ARIFF HAZNAL
1151100066
L1/T4

ANSWER
Issue 1
Whether the creditor’s petition was properly served on him;
Law
Rule 108 of Insolvency Rules 2017
A creditor’s petition shall be personally served and shall be effected by delivering a sealed
copy of petition to the debtor.
Rule 110 of Insolvency Rules 2017
Service must be supported by an Affidavit of Service.
Lim Boon Kiak v Affin Bank Bhd

 Substituted service could only be effected with leave of the court.


 The creditor's petition against a JD could not be served by any other means
 It could not be served on a firm of solicitors unless there was a clear indication in writing
that the said firm had the authority to accept service of the documents on behalf of the JD.
 The said creditor's petition was served on the appellant's solicitor but there was no
indication to show that the said solicitor had the authority to accept service of the
creditor's petition on behalf of the JD.
Re Tan Hwee Earn, ex p The People’s Insurance Co (M) Sdn Bhd
 The service of the petition includes service of the verifying affidavit. The two are
generally served together.

Issue 2
Whether the creditor’s petition was invalid because the verifying affidavit was affirmed
before the creditor’s petition was presented?
Law
Rule 105 of Insolvency Rules 2017
A creditor's petition shall be verified by an affidavit and shall file the affidavit to the person
who can depose to them.
Sobri Arshad v Associated Tractors SB
- The date of the creditor’s petition was dated 10.11.89
- However, the affidavit that verifes the petition was dated 9.11.89.
- The court held the creditor’s petition to be dismissed because it was not curable due to being
a fundamental error under S. 131 of the Bankruptcy Act 1967
- An affidavit shall not be affirmed prior to the date of creditor’s petition. It should follow the
same date as the creditor’s petition or after the creditor’s petition has been issued.
LAW OF INSOLVENCY
AMMAR MUSTAQIM BIN ARIFF HAZNAL
1151100066
L1/T4

Re Ho Weng Keong ex p Marketlink (M) S/B.


it was expressly provided that an affidavit is allowed to be filed on the same day the petition
was issued or after because something that does not exist in unverifiable. This term is known
as unborn petition. An affidavit that is filed together with the creditor’s petition is good in the
eye of law.
Teoh Thean Peng v D & C Leasing Sdn Bhd
After the petition is attested, the affidavit verifying the petition must be affirmed. It is also
permissible if it is done shortly before the petition is filed but after it has been duly attested is
permissible. Basically, a creditor is allowed to file a creditor’s petition against the said debtor
after the seven day period that was given to respond to the bankruptcy notice has expired.

Issue 3
Whether the bankruptcy proceedings against Mr Hutang will continue since after he passed
on 1.4.2020?
Law
Section 96 of Insolvency Act 2017
the death of a debtor does not invalidate the bankruptcy proceedings pre-commenced and
served during his lifetime.
Section 122 (2) of Insolvency Act 2017
the creditor may petition the court for the administration of the estate of the deceased.
Rule 111 of Insolvency Rules 2017
The court has the discretion to dispense with service of the petition on the deceased debtor or
alternatively for service to be effected on his personal representative or such other persons.
LAW OF INSOLVENCY
AMMAR MUSTAQIM BIN ARIFF HAZNAL
1151100066
L1/T4

Question 2
Borrow Easy Bank Bhd. (BEBB) obtained judgment against Linda Hutang on 10.1.2018 “for
the sum of RM230,000 and interest thereon at the rate of 10% p.a. calculated form the date of
judgment to the date of full settlement”.
On 2.3.2018 BEBB issued a Bankruptcy Notice against Linda Hutang for the sum of
RM230,000 and interest at the rate of 10% calculated from the date of judgment to the date of
the Bankruptcy Notice dated 2.3.2018.
Although Linda Hutang resided at A-10, Jalan Tengah, Kampung Attap, attempts at service of
the Bankruptcy Notice and Creditor’s petition was done at 10-A Jalan Setengah Kampung
Attapchi.
An order for substituted service of the Bankruptcy Notice and Creditor’s petition was
obtained on the grounds that Linda Hutang could not be located. Both the Bankruptcy Notice
and the Creditor’s Petition were served by substituted service by posting the documents to
10-A Jalan Setengah Kampung Attapchi, and by advertisement in the “Star” newspaper.
Bankruptcy Order was then obtained against Linda Hutang on 10.12. 2018.
Linda Hutang now appoints you to set aside the Bankruptcy Order. What are the grounds for
such application?

You might also like