This is a new provision designed to deal with claims made to the Official Assignee alleging ownership of property in a bankrupt's possession. According to the committee many claims which are lodged are of a questionable nature and their investigation takes considerable time and results in deterioration of assets. The section, therefore, provides that such a claimant should file with the Official Assignee a claim verified by affidavit. Furthermore, if an affidavit is not filed within a month after service of a notice to any person to prove his claim to the property the Official Assignee may sell or dispose of it free of the claimant's interest. Although it was not recommended by the committee it was considered advisable to make any sale or disposition under the section subject to the sanction of the court.
SECTION 70.
Presumably this would have considerable relevance where the bankrupt was a trader and was trading goods on which there was a reservation of title, for example, in a growth area. Is that correct?
Yes. We are looking at the area of reservation of title because there might be difficulties.
You are looking at it, Minister, in the context of maybe introducing some special rule for it?
To explain this section more fully, during the course of their deliberations the committee were informed that claims were frequently made to the Official Assignee alleging the ownership of property in the bankrupt's possession. They said that many of the claims made were of a questionable nature and this involved the Official Assignee in investigations which resulted, in fact, in a deterioration of assets. In order to deal with claims expeditiously both to the satisfaction of a genuine claimant and to the Official Assignee the committee provide for the lodgment of proof with a supporting affidavit. They also provide for it in the absence of proof, the Official Assignee could sell the property. In the case of doubt or difficulty he would consult the court. We adopted the section as suggested by the committee with the proviso that the court's prior sanction would be required. This section does not, strictly speaking, refer to any particular type of property. It may be property outlined already but it is purely a practical operational exercise of the assignee's office. That is the purpose of the section.