The date of the commencement of a bankruptcy is vital when determining what assets vest or can be clawed back by a trustee in bankruptcy.
There are two dates which may appear to have the same meaning, however are fundamentally different. This first is the “commencement of bankruptcy” and the second is the “date of bankruptcy”.
The commencement of bankruptcy refers to the date of the earliest “act of bankruptcy” that has been committed by a person within the 6 month period immediately before the presentation of a creditors petition (section 15 of the Bankruptcy Act 1966 (Cth)).
The date of bankruptcy, according to section 5 of the Bankruptcy Act 2001 (Cth), is the date on which a sequestration order is made against the estate of a bankrupt (in the context of a creditor’s petition) or the date that the Official Receiver accepts a debtor’s petition and declares the debtor bankrupt.
The date of the commencement of a bankruptcy is vital as it is at this date that all property owned by a bankrupt can be claimed by a trustee in bankruptcy. Further, any property that is acquired by a bankrupt during the period between the commencement and the date of bankruptcy is capable of being claimed by a trustee.