ATO favourites bungle bankruptcy notice

When the ATO tapped Pitcher Partners’ Andrew Yeo for the high profile appointment as Jon Adgemis’s bankruptcy trustee, we wonder if the public service boffins were across Yeo (Trustee), in the matter of Trim (Bankrupt) v Trim [2025] FedCFamC2G 1307.

“In any event, for reasons which will become apparent, the affidavit of debt relied upon is little more than a bare assertion and is attended with such ambiguity that it does not provide me satisfaction as to the amount truly owed by the debtor. Even if I was to dispense with compliance with r 4.06, the evidence of the petitioning creditor fails to measure up as satisfactory proof of the debt which remains outstanding.” Judge Jonathan Forbes.

If there weren’t, perhaps they should’ve been. The ATO is owed something in excess of $160 million in the Adgemis estate and if there’s any chance at all of a recovery, the tax office will want a top operator in the role.

Yeo of course has been the ATO’s go to on high profile cases before, such as when he and Gess Rambaldi were asked in 2018 to wind up the execrable affairs of industrial phoenixer Philip Whiteman.

But the ATO won’t want any stuff ups on the Adgemis job given its profile as one of the largest bankruptcies in Australia and as the August 15 decision of Federal Circuit and Family Court of Australia judge Jonathan Forbes shows, even well regarded practitioners have off days.

The judgement deals with an application by one Matthew Darrin Trim for review of a registrar’s decision to order that his estate be sequestered and PCI Partners’ David Quin be appointed as his trustee in bankruptcy.

Quin received the referral from Yeo and Rambaldi, who as the trustees of the bankrupt estate of one Russell Trim had obtained judgment against Matthew Trim and petitioned for sequestration of his estate after their bankruptcy notice went unanswered.

As the judgment shows, Trim succeeded in having Yeo and Rambaldi’s creditors’ petition dismissed and the sequestration order it was based on set aside because the notice and petition had more defects than Chernobyl pond scum.

In defiance of the mandatory requirements of rule 4.06 of the Federal Circuit and Family Court of Australia (Division 2) (Bankruptcy) Rules 2021 (Cth) (the Bankruptcy Rules) the pair did not file an affidavit of debt and an affidavit of search prior to the hearing of the creditor’s petition.

In respect of the bankruptcy notice the judge found that it was invalidated by Yeo and Rambaldi’s “impermissible conflation” of interest accruing on the judgment debt and on a subsequent forbearance deed, such that the notice failed the test of providing a debtor with a clear understanding of what they needed to pay to discharge the notice.

As a consequence of this bungleodeon the judge ordered that Yeo and Rambaldi’s creditors petition, filed on 21 December 2023 and amended on 23 July 2024, be dismissed and the sequestration order made on 3 October 2024 be set aside. A decision on costs appears to have been reserved.

No doubt whatever bugs in Pitchers’ processes led to such an uncharacteristic outcome have been exterminated so as to prevent any outbreak of incompetencies on the Adgemis file, thereby sparing the ATO appointors any more sleepless nights then may already be having.