Tutorial 5

Question 2
Prepared by ,
Marvin Raja ( 1161100438 )
Muthu was adjudged a bankrupt by the High Court, following a creditor's petition filed by ABC Bank Bhd. The 'DGI then, wrote to
the bankrupt at his last known address, but there was no response, and his estate was left unadministered. Subsequently, the DGI
wrote to various organisations for further information and details the bankrupt. Filing to get any information about the bankrupt, the
DGI issued a notice of intention to issue a certificate of discharge in respect of the bankrupt. ABC Bank Bhd., served its notice of
objection. The DGI rejected the ABC Bank Bhd's notice of objection on the grounds that

(i) the case had been administered for 16 years;

(ii) the bankrupt could not be located;

(iii) the bankrupt had no known assets to be distributed to the creditors;

and (iv) no dividends could be declared to the creditors. ABC Bank Bhd. filed its notice of application to the SAR to prohibit the DGI
from issuing a certificate of discharge to the bankrupt under s. 33B(4) IA1967 .

Discuss the viability of ABC Bank’s objection to the DGI’s application to discharge the bankrupt.
(i) Whether DGI was correct in objecting to ABC Bank’s objection to the DGI’s application to discharge the bankrupt on
ground that the case had been administered for 16 years?

Applying S33A (1), DGI has the discretion but not absolute to issue a certificate of discharge a bankrupt, Muthu from
bankruptcy as it was subjected to S33(B) of IA. Pursuant to the case mentioned, DGI does not have absolute discretion to
issue certificate of discharge and thus no right to refuse ABC Bank Bhd’s notice of objection. DGI should procure the
attendance of Muthu and commence the administration of the estate. DGI was wrong in objecting to ABC Bank’s objection to
the DGI’s application to discharge the bankrupt on ground that the case had been administered for 16 years as DGI had no
absolute discretion in doing so.

(ii) Whether DGI was correct in objecting to ABC Bank’s objection to the DGI’s application to discharge the bankrupt on
ground that the bankrupt could not be located?

Applying the case mentioned, court required DGI to make use all reasonable endeavours to locate Muthu even-though DGI
had written to other organisations to enquire for Muthu’s information. It is insufficient due to the fact DGI never enquired
details from ABC Bank. As a creditor of Muthu, ABC Bank could have details about him. This shows DGI did not make use all
reasonable endeavours to locate Muthu. Therefore, DGI was wrong in objecting to ABC Bank’s objection to the DGI’s
application to discharge the bankrupt on ground that the bankrupt could not be located.
(iii) Whether DGI was correct in objecting to ABC Bank’s objection to the DGI’s application to discharge the
bankrupt on ground that the bankrupt had no known assets to be distributed to the creditors?

Re Benny Ong Swee Siang, ex parte United Overseas Bank (M) Bhd (formerly known as United Overseas
Finance (M) Bhd where DGI should procure the attendance of the bankrupt JD and commence the
administration of the estate when situation is of an unadministered estate in bankruptcy. Muthu’s estate here
was left unadministered by the DGI. Applying the case mentioned, as Muthu’s estate was unadministered as
no administrative task was done like meeting creditors or public examination of debtor undertaken up till this
date. DGI should not have granted the certificate of discharge to Muthu and allowing him scot-free. But he
should have should procured the attendance of the bankrupt JD and commence the administration of the
estate. Therefore, DGI was wrong in objecting to ABC Bank’s objection to the DGI’s application to discharge
the bankrupt on ground that the bankrupt had no known assets to be distributed to the creditors and the DGI
should have procured the attendance of the bankrupt JD and commence the administration of the estate.

(iv) Whether DGI was correct in objecting to ABC Bank’s objection to the DGI’s application to discharge the
bankrupt on ground that no dividends could be declared to the creditors?

DGI’s discretion in issuing a certificate of discharge is subjected to S33B of IA and it is to be exercised

judiciously based on facts of individual case. Here, dividends were not paid to the creditor as the judgement
debt was not recovered from assets of judgement debtor. Plus, DGI left the estate unadministered and High
Court allowed appeal. Applying to our case, ABC Bank could challenge DGI’s application to discharge the
debtor having the ground of DGI leaving estate unadministered which made the dividends unpaid.