Trustee – no deed of release, no annulment

One of the duties of a trustee is ensuring effective communication with stakeholders and iNO has not seen a more effective means of inviting questions about whether that duty’s been fulfilled than by muzzling a bankrupt with an AVO.

During a hearing in the Federal Court yesterday it came to light that the trustee in question, Louisa Sijabat of Merchants Advisory, was regarded as having breached that duty in part.

Sijabat had sought the AVO amid efforts by the now former bankrupt Piers Warren to persuade her to call a meeting of members of his companies so a new director could be appointed.

Warren was the beneficial holder of a controlling interest in his companies. After sequestration in 2023 the shares vested with his trustee.

But when the companies’ renewal fees went unpaid they were de-registered by ASIC.

This Warren claims meant he and his family missed out on significant business opportunities such that he and his family have threatened to sue Sijabat for millions in compensation.

Coincidentally Sijabat has refused to finalise the bankruptcy by filing the certificate of annulment despite all creditors having been paid 100 cents in the dollar and payment being made to her solicitors from ERA Legal prior to the commencement of the Warren proceedings.

She will however consider taking the final steps if Warren agrees to abandon his claims and provide a full deed of release and indemnity, an option ERA referred to in a letter that described a deed of release as one potential path among others towards a resolution.

The correspondence did not particularise any other potential paths and in June this year Warren commenced proceedings seeking orders that the trustee complete the steps necessary to finalise administration of the estate.

So with AVOs, incomplete annulments and threats of writs for compensation it’s no wonder the parties are at loggerheads.

Sijabat’s barrister Ralphed Notley of University Chambers strove to persuade Justice Melissa Perry that Sijabat had reasonable grounds for her view that the estate could not yet be finalised but rejected the contention from Warren’s lawyer Philip Beazley that Sijabat was holding out only to force provision of a release.

Sijabat was also cross examined extensively about the communications with the ex-bankrupt as he sought to have a new director appointed and discuss a potential Section 73 Compromise, though Sijabat told the court she never received a signed S73 proposal from Warren.

Those efforts included multiple emails and phone calls to Sijabat. But when Warren suggested he meet with Sijabat he apparently crossed a red line in her mind, precipitating her reporting him to the police.

That resulted in Warren being charged with stalking and intimidation and the issuing of an AVO that prevented him from contacting Sijabat except through a lawyer.

During this period Warren made a complaint to AFSA and yesterday the court heard that in correspondence to Sijabat AFSA’s Practitioner Surveillance and Enforcement Division found the complaint “partially justified”.

Sijabat also said she did not believe she had an entitlement to a deed of release in exchange for processing the annulment but it remains unclear what’s stopping her given that the June 2025 proceedings commenced by Warren seek to have the court require her to file the paperwork for the issue of a certificate annulment.

As Beazley pointed out, if she did that then the parties would be having a costs argument instead.

What Justice Perry will make of Warren’s claims awaits her honour delivering judgment, which was reserved.

iNO asked Sijabat if she had at the time of her appointment turned her mind to the potential outcome if a new director was not appointed to the Warren family’s group of companies.

She did not respond by deadline.