Shin v Howell, in the matter of Shin [2025] FedCFamC2G 1892

1. Mr Raphael Shin ("the applicant") seeks orders pursuant to s 90-15 of the Insolvency Practice Schedule (Bankruptcy) ("the Schedule") to the Bankruptcy Act 1966 (Cth) ("the Act") that Mr Howell ("the Respondent"), cease to be Trustee for the bankrupt estate of Raphael Shin.
2. Further orders are sought in relation to costs in the matter to be paid by the respondent personally. The applicant seeks a final order that pursuant to s 90-15(3)(d) and or (5)(b) of the Schedule and/or s 43 of the Act, that the respondent is not entitled to be reimbursed from the bankrupt's estate in relation to the costs in the aforementioned order.

1. The applicant is of Korean ethnicity. The applicant is married to Yi Jeong (Rebecca) Shin. The applicant and Rebecca Shin have a son, Sol Shin. The applicant, Rebecca Shin, and their son have been involved in a complex web of businesses, registered companies and trusts over the preceding 15 years.
2. In Fair Work Ombudsman v Sushi Bay Pty Ltd (in liq) (No 3) [2024] FCA 869 ("Sushi Bay"), Rebecca Shin, was fined an amount of $1.6 million for her part of the conduct of four corporations', of which she was the sole director and chief executive officer, for the "exploitation of immigrant workers and a shameless but ultimately unsuccessful attempt to conceal it": Sushi Bay at [1].
3. That matter is not relevant and has not been taken into account in the current proceedings, except as follows. At [73], [78] and [80], Katzmann J found that Rebecca Shin and the applicant provided a loan of over $4 million to the Shin Family Trust, which she failed to disclose in her affidavit, which had not been repaid. Rebecca Shin reluctantly acknowledged that she can call on the loan to be repaid in full at any time. The applicant and Rebecca Shin are the only beneficiaries under the Shin Family Trust.
4. At [81], Katzmann J noted that the disclosed value of the Shin Family Trust, consisting of five properties, in financial statements for the year ending 30 June 2023, was listed as $2,640,000.00. This reflects the amount paid for the properties at the times of purchase (ranging from 2003 to 2015). However, a report from the Trustee of the Shin Family Trust, Raphael Shin Enterprises Pty Ltd, lodged with the Australian Securities and Investment Commission ("ASIC") on 28 May 2021 by controllers appointed to one of those properties and two others not mentioned in the 2023 Financial Statement, which was verified by the applicant, shows the combined asset value of those properties in May 2021 as $26,850,00.00. More of this later.
5. The applicant and Rebecca Shin live at premises in Ryde, New South Wales. On 31 August 2022, that property was transferred by the applicant and Rebecca Shin to their son, Sol Shin, for the sum of $4.9 million. It is claimed that the proceeds of the sale were expended to discharge a number of debts. Katzmann J concluded that Rebecca Shin was not a person of modest means and had the capacity to pay a substantial penalty: Sushi Bay at [84].
6. On 7 March 2024, in the Melbourne Registry, at the petition of North Wonwondah Pastoral Company Pty Ltd, the applicant was made bankrupt by Order of this Court. The applicant's bankruptcy arose as a consequence of a costs order against him and a company with which he was associated, connected with proceedings commenced by North Wonwondah, in respect of a debt of $175,270.00.
7. The respondent was appointed as the applicant's Trustee in bankruptcy. Following the making of the sequestration Order against him, the applicant lodged a statement of financial affairs with the respondent and the Australian Financial Security Authority ("AFSA") which identified creditors of $681,119.89. Subsequently, the respondent has identified other creditors of $213,132.39, comprised of an unadjudicated claim by a liquidator of another company, Sorenzo Pty Ltd, for insolvent trading and in respect of which proceedings have not been commenced, and a further claim for and assessed costs by North Wonwondah Pty Ltd of $32,142.00.

1. The evidence before the Court consisted of two Affidavits of the applicant, the first affirmed on 5 March 2025 and the second affirmed on 22 August 2025. Mr Sol Shin provided an Affidavit sworn on 22 August 2025. The respondent tendered two Affidavits, the first affirmed on 9 July 2025 and the second affirmed on 23 September 2025.
2. The applicant was cross examined briefly, the respondent more extensively.

THE APPLICANT'S COMPLAINTS AGAINST THE RESPONDENT

1. The applicant complains that many of the actions taken by the respondent were plainly inappropriate, in excess of any power that he might have, arbitrary and capricious or otherwise of no benefit to the bankrupt estate. These actions, it is claimed had the effect of placing unwarranted and unfair pressure on the applicant and have resulted in the breakdown of the relationship between the applicant and the respondent.
2. The first issue relates to a request by the Trustee that the applicant attend a meeting in person in Melbourne on 21 April 2024 at his own expense. The applicant claims he did not have the funds to do so and requested the meeting take place via video conference. That request was refused. The applicant subsequently travelled to Melbourne with his son, who acted as an interpreter. The applicant claims he did so under protest. The ultimate source of the funds for that travel is not apparent. The Court assumes that funds were provided from a third party, possibly Mr Sol Shin. The Court notes that the applicant physically handed over a number of documents at that meeting. The applicant complains that the respondent did not attend personally, rather the meeting was with staff employed by him. In this regard the date of the meeting was changed to a date the respondent was not available.
3. The next issue relates to a request by the respondent that the applicant hand over his Korean passport to the respondent or his staff, and a refusal to approve overseas travel. It is uncontested that the applicant provided his Australian passport to his Trustee at or shortly after the initial meeting. The applicant claims he does not hold a Korean passport. The respondent refused to accept this fact until the applicant provided a statement in writing that he did not hold a Korean passport.
4. The applicant deposes that at the time of handing over his Australian passport, he inquired of his Trustee about attending an international 'Go" competition and conference in Seoul Korea, as the Australian National Representative. The applicant made a subsequent formal application to travel. In that request he stated his annual income as $80,000.00 per annum from employment with Australian Coral Coast Mariculture Pty Ltd ("ACCM"), a company owned by his son Mr Sol Shin. The applicant stated that his proposed dates of travel were leaving on 16 May 2024 but returning on the same date. Although the application was dated 1 May 2024, the applicant stated that his date of commencement of employment with ACCM was 22 May 2024. Suffice to say there were significant errors in the application. The travel was not approved and did not go ahead.
5. On 22 August 2024, the applicant made a second application for overseas travel. The applicant requested approval to travel from 8-19 September 2024 to South Korea and Indonesia for the purpose of liaising with suppliers of and buyers for the produce of ACCM. At this time the applicant stated that his salary was only $40,000.00 per annum. The source of funds for the travel was ACCM.
6. The second request was refused by letter dated 3 September 2024 (CB 131-133). Among the reasons cited by the respondent for refusing the applicant's request to travel overseas were first, that he was considered a flight risk. Second, the applicant had not articulated why such meetings could not occur by Zoom or other means without the need to travel. Third, the applicant's level of responsibility, reflected by the salary he received, did not justify his presence overseas. Fourth, the applicant had failed to respond to emails from Mr Pattison (an employee of the respondent) seeking information.
7. What follows in that letter are a large number of claims by the respondent, that the applicant has failed to provide accurate information in relation to his statement of affairs, including not disclosing all known creditors and the fact that there was a debt owing of $4 million to the applicant and Rebecca Shin from the Shin Family Trust, as found by Katzmann J in Sushi Bay, set out above_._ It was also noted that the applicant had not yet provided a copy of the Shin Family Trust deed. Further, that the applicant stated that the Trustee of Shin Family Trust, Raphael Shin Enterprises Pty Ltd, had never traded, which was clearly false. The letter also noted that the applicant resigned as a director on 5 March 2024. Other issues were set out, including that the main creditor objected to the applicant travelling overseas.
8. The applicant's evidence is that at that point he determined not to respond or deal further with the Trustee: Affidavit of Raphael Shin affirmed on 22 August 2025 at [6]. On 20 September 2024, Mr Shin lodged a general complaint about his Trustee with AFSA.
9. The next issue relates to an Income Contribution Assessment (CB 741-743) raised by the respondent and provided to applicant on 30 April 2024. The respondent claims that income assessment was based on the information contained within the applicant's Statement of Financial Affairs (SOFA). The SOFA, dated 16 April 2024, provided by the applicant (CB 74-115) clearly set out that the applicant was employed by ACCM with an annual salary of $80,600.00 per annum. The Shin Family Trust was listed with assets of $2,708,000.00.
10. The Income Contribution Assessment required the applicant to make a contribution of $10,271.00 either by way of lump sum or by 10 monthly instalments. The applicant, on 22 May 2024, lodged an Application for a Review of that Assessment with AFSA (CB 746-749). The applicant also made various complaints against the respondent, including the appointment of a Victorian based Trustee, the refusal of his first travel request and requests for the production of a large number of documents within two days. The applicant also complained that he was embarrassed that he had his bank accounts frozen as he understood he was going to be able to use his everyday account for day-to-day purposes.
11. Most relevantly to the Application for a Review was a payslip from ACCM, a company operated by the applicant's son, Sol Shin, that indicated that as at 22 April 2024, the applicant's income had reduced to $40,000.00 per annum (CB 749). This income meant that the applicant fell below the threshold required for an income contribution to be made. The applicant also took issue with the Fringe Benefit calculations. As to the reduction in income, the applicant, simply stated that since his bankruptcy, his hours of work had reduced. The Court notes that at no time post receipt of the Notice of Assessment did the applicant provide evidence of his reduction in income direct to the respondent.
12. On 14 June 2024, AFSA advised the respondent that on a preliminary view the income assessment would be set aside and invited the respondent to either withdraw the current assessment and issue a fresh assessment or withdraw the assessment and make further inquiries. The respondent provided the basis of his calculations to AFSA. Further correspondence ensued. However, on 17 June 2024, AFSA was advised that the income assessment had been withdrawn. The applicant had been notified. Further inquiries would be made and a fresh assessment made at a later time (CB 769).
13. The next cause of complaint is the Objection to Discharge as a Bankrupt filed by the respondent. On 3 December 2024, the respondent lodged a Notice of Objection to the Discharge of the applicant from his bankruptcy (CB 146-149). The grounds included that the applicant had not adequately disclosed what happened to the funds obtained from the sale of his and Rebecca Shin's property in Ryde to their son in August 2022 for $4.9 million. Further, the applicant had not adequately disclosed to the Trustee, his beneficial interest in any property including the Shin Family Trust. In addition, the applicant failed to respond to correspondence sent to him on five occasions covering the period August to November 2024, other than a response of 22 November 2024 stating he was asking AFSA for a review of the administration of his estate, and he will revert to his Trustee once a review is completed.
14. In correspondence addressed to AFSA of 9 December 2024, the applicant complained that the respondent was not treating him "fairly, respectfully and with dignity, ... and has shown no intention of treating me as such...(and) is vindictive...seeking to punish me for complaining about his conduct and character."
15. On 9 December 2024, the applicant made an Application for a Review of the Notice of Objection to Discharge. Following correspondence between AFSA and the respondent withdrew the Notice of Objection on 23 January 2025.
16. On 4 February 2025, the applicant wrote to the respondent expressing concern that the conduct of the administration by his office (CB 163-164):

..."demonstrates a pattern of indifference to the legislative requirements, a lack of knowledge of the law or disregard standards published as a guide to practitioners, such conduct is inconsistent with a high standard expected of a trustee", contrary to the expectations of AFSA as outlined... In the absence of an apology and steps to remedy the continuation of the erroneous and the high-handed conduct by your office, it must be in the best interests of the bankruptcy that you stand aside. I invite you to do so or at least provide a tangible proposal to reset the conduct of the administration and remedy the errors of the past.

1. In the absence of the respondent standing aside, the applicant indicated he would make an application of this Court that he ceased to be the Trustee of the applicant's estate.
2. The respondent responded on 7 February 2025 (CB 161-163). The respondent noted that his responsibility was to act in the best interests of the creditors to the applicant's estate and that many of his complaints to AFSA had not been substantiated. The respondent further noted that by withdrawing the Notice of Objection, the applicant had been provided a further opportunity to comply with his obligations as required under the Act. It was noted that many of the emails sent to the applicant remained unanswered. The Court notes in particular the nondisclosure of the debtor of $4,001,998.00 as disclosed in Sushi Bay, hardcopy evidence of the disbursements of funds received from the sale of his family home to his son in the sum of $4,900,000.00, together with information relating to real estate owned by the Shin Group in 2021 to the value of $26,850,000.00.
3. The respondent also noted that the applicant still appeared on the Spacecon Pty Ltd website as CEO, contradicting the information provided by him to date in relation to his current employment.

THE LAW IN RELATION TO THE REMOVAL OF A TRUSTEE IN BANKRUPTCY

1. It is common ground between the parties that the relevant principles to be applied are set out in Mokhtar v Piscopo [2024] FCA 493 ("Mokhtar") per Perry J at [29] - [42]. While this is a lengthy passage it is worth setting it out in full.
   1. First, the general duties of the trustee in bankruptcy and the limited role of the Court provide important context against which to consider the matters raised by the applicant, even though there is no allegation of a breach of duty in the present case. The law in this regard is well-established and conveniently explained by Wigney J in Shaw at [27]-[29] as follows:

A trustee in bankruptcy is subject to the general law relating to trustees, except where bankruptcy legislation modifies the general law: Adsett v Berlouis [1992] FCA 368; (1992) 37 FCR 201 at 208-210. In Adsett, the Full Court adopted the following observations of Smithers J in Mannigel v Aitken [1983] FCA 183; (1983) 77 FLR 406 at 408-409 as a correct statement of the duties, and the proper manner of performance of those duties, of a trustee in bankruptcy:

In the case of bankruptcy the Trustee is in charge of the assets of the bankrupt and those assets are to be applied for the benefit of the creditors and if there be any surplus for the benefit of the bankrupt. It is clear that the minimum standard required of the Trustee is that he shall handle the assets with a view to achieving the maximum return from the assets to satisfy the claims of the creditors and to provide the best surplus possible for the bankrupt. Obviously a great deal of discretion and judgment is required to be exercised by the Trustee. It was said by Rogerson J in Re Ladyman (1981) 55 FLR 383 at 394-396 that the standard of conduct required of the Trustee will ordinarily be the standard required of a professional man and perhaps higher. The learned judge referred to "the high standard of conduct required of trustees".

In Re Brogden [1888] All ER 927 Lord Justice Fry said at p 935:

"A Trustee undoubtedly has a discretion as to the mode and manner, and very often as to the time in which or at which, he shall carry his duty into effect. But his discretion is never an absolute one. It is always limited by - the dominant duty - the guiding duty of recovering, securing and duly applying the trust fund; and no Trustee can claim any right of discretion which does not agree with that paramount obligation."

...

As has already been noted, in [Re Tyndall [1977] FCA 15; (1977) 30 FLR 6], Deane J referred (at 10) to the "well-established policy under bankruptcy legislation that the court should not unduly interfere with the day-to-day administration of a bankrupt's estate by a trustee". His Honour continued (at 10):

The trustee is made responsible for the administration of the bankrupt estate under the general provisions of the Act. He must, in the course of that administration, make a variety of decisions aimed at enabling the administration to be carried out with promptness and efficiency. Some of these decisions will be business or commercial decisions in which the business or commercial experience of the trustee would itself provide a basis for arguing that, unless it were shown that the trustee's decision was perverse or clearly wrong, it would be inappropriate and unjust for the court to interfere.

In Patel v Ruhe [2016] FCA 520, Buchanan J said (at [33]):

Although a trustee may not disregard the legitimate interests of a bankrupt, a primary duty of a trustee is to protect the interests of creditors and recover for the estate such property as may reasonably be recovered in a commercially sound way. Judgments are required. The judgments are ones for the trustee to make and the Court will normally not interfere unless it is clear that some maladministration of the estate has occurred or is likely ...

(Emphasis in original.)

1. The caution sounded in the authorities cited by Wigney J against undue interference by the Court in the administration of bankruptcy is a matter to which I have had particular regard in the exercise of discretion in the present case.

2. That caution was repeated in Frigger v Trenfield (No 10) [2021] FCA 1500; (2021) 397 ALR 24 (Frigger (No 10)), where Jackson J considered an application relevantly seeking an order under s 90-15(3)(b) of the Schedule that a trustee of certain bankrupt estates cease to be the trustee (at [553]). His Honour helpfully summarised the trustee's duties relevantly as follows at [555]-[556] and [558]-[559]:

A trustee in bankruptcy must act to the standard expected of an officer of the court, given that his or her acts or omissions are, in general, reviewable by the court. 'That is because the statutory office of a trustee in bankruptcy is a public one that reposes considerable statutory powers in the trustee to enable him or her to carry out the public duty to administer the bankrupt's estate according to the Act': Young v Thomson [2017] FCAFC 140; (2017) 253 FCR 191 at [115] (Siopis and Rares JJ).

Because the trustee is exercising a fiduciary power, he or she has a duty to do so honestly (i.e. in good faith), to act upon genuine consideration, and not to act irresponsibly, capriciously or wantonly. The trustee must exercise the relevant power with due consideration for the purpose for which it was conferred and not for some ulterior purpose. A professional trustee should be particularly careful to act strictly within the line of the trustee's duty: Young v Thomson at [110]-[111].

...

Other expressly stated objects of the Insolvency Practice Schedule are to ensure that any person registered as a trustee has an appropriate level of expertise and behaves ethically: s 1-1(1)(a) and (b). There is also a large number of specific duties imposed on trustees in bankruptcy by statute. They relevantly include:

• determining whether the estate includes property that can be realised to pay a dividend to creditors (Bankruptcy Act s 19(1)(b));

• taking appropriate steps to recover property for the benefit of the estate (Bankruptcy Act s 19(1)(f));

• administering the estate as efficiently as possible by avoiding unnecessary expense (Bankruptcy Act s 19(1)(j));

• exercising powers and performing functions in a commercially sound way (Bankruptcy Act s 19(1)(k));

• acting honestly and impartially in relation to each administration (Insolvency Practice Rules (Bankruptcy) 2016 (Cth) (Bankruptcy Practice Rules) r 42-10(1);

• not making or signing a document that the trustee knows, or ought reasonably to know, is false or misleading in a material particular (Bankruptcy Practice Rules r 42-10(2)); and

• taking care to ensure that all communications, including reports (whether issued personally or by delegation) are accurate and do not omit or obscure information required to be included or relevant to users of the communication (Bankruptcy Practice Rules r 42-15(2)).

It is also relevant in this proceeding that, under the Bankruptcy Practice Rules, the trustee must undertake preliminary inquiries and actions at the start of each administration, including:

• obtaining and reviewing the statement of affairs of the regulated debtor (Bankruptcy Practice Rules r 42 30(b));

• if necessary, interviewing the regulated debtor to clarify any matters in the statement of affairs (Bankruptcy Practice Rules r 42-30(c));

• identifying and making an assessment of realisable assets that could be expected to provide a return to creditors or contribute to the payment of the costs and fees of the administration (Bankruptcy Practice Rules r 42-30(d));

• determining the likelihood of whether the estate of the regulated debtor includes property that can be realised to pay a dividend to creditors (Bankruptcy Practice Rules r 42-30(f));

• if the trustee has a genuine reason for believing that the bankrupt may not have disclosed an interest in real or other registered property - conducting appropriate searches for such property (Bankruptcy Practice Rules r 42-30(g));

• if information so obtained shows that the bankrupt has not made full and true disclosure of his or her interest in property, making inquiries of third parties about the information (or if further inquiries are not made, explaining to the creditors why they were considered unnecessary) (Bankruptcy Practice Rules r 42-30(h)); and

• if the trustee considers that there may have been antecedent transactions, making inquiries of third parties to identify those transactions (Bankruptcy Practice Rules r 42-30(i)).

(Emphasis added.)

1. Secondly, s 90-15 of the Schedule replaced s 179 of the Bankruptcy Act, reforming the process of removing a trustee. Importantly, under the former provision, removal could occur only following a two-part process. An applicant had first to establish grounds for an inquiry into the conduct of the trustee before a Court could order the trustee's removal. That is no longer a requirement under s 90-15. As White J held in Borg (at [24]):

In contrast with the former s 179(1), s 90-15 does not require a two stage consideration. An applicant seeking the removal of a trustee does not have to establish proper grounds for an inquiry. The power to remove and replace is not made subject to conditions such as proof of error, misfeasance, negligence or other poor conduct by a trustee.

(Emphasis added.)

1. I note, however, that there may still be cases where it is nonetheless appropriate to embark on a two-stage process similar to that under s 179 of the Bankruptcy Act. As Wigney J explained in Shaw at [21], "[s]uch an approach may be appropriate where the orders sought by the applicant are based on broad allegations of misfeasance, neglect or other error in the conduct of the administration of the estate by the trustee, particularly where those allegations effectively encompass almost every aspect of the administration of the estate." However, while at times the Trustee's submissions appeared to stray into such an approach, neither party suggested that the present matter was a case where that approach should be adopted.

2. Thirdly, the enactment of s 90-15 more closely aligned the rules for the removal of trustees in personal bankruptcies with those for the removal of liquidators in corporate insolvencies: Pioneer Australia Pty Ltd v Bettles as Trustee of the Bankrupt Estate of Quinn [2020] FCA 1788 at [30] (Derrington J); Borg at [26]. The principles and case law concerning the removal of liquidators may therefore apply by analogy when considering whether to remove a trustee in bankruptcy.

3. Fourthly, and of particular relevance, the Court's power to remove a liquidator (and, by analogy, a bankrupt) "is not limited to matters relating to the unfitness of the liquidator to hold office": Domino Hire Pty Ltd v Pioneer Park Pty Ltd (in liq) [2003] NSWSC 496; (2003) 21 ACLC 1330 at [58] (Austin J). Rather, "[i]t is open to the applicant for removal to point to any conduct or inactivity on the liquidator's part that provides a basis for the conclusion that he or she should be removed, ranging from moral turpitude, to bias or partiality, lack of independence, incompetence or other unfitness for office": at [58]. The relevant authorities are helpfully discussed by White J in at [29]-[33] (White J) as follows:

In Re Adam Eyton Ltd; ex parte Charlesworth [1887] UKLawRpCh 148; (1887) 36 Ch D 299, Cotton LJ said, at 303-4:

[I]t is not necessary, in order to justify the Court under this section in removing the liquidator, that there should be anything against the individual. In my opinion, although of course unfitness discovered in a particular person would be a ground for removing him, yet the power of removal is not confined to that, ... [I]f the Court is satisfied on the evidence before them that it is against the interest of the liquidation, by which I mean all those who are interested in the company being liquidated, that a particular person should be made liquidator, then the Court has power to remove the present liquidator, and of course then to appoint some other person in his place.

In many cases ... unfitness of the liquidator will be the general form which the cause will take upon which the Court in this class of case acts, but that is not the definition of due cause shewn. In order to define "due cause shewn" you must look wider afield, and see what is the purpose for which the liquidator is appointed. To my mind the Lord Justice has correctly intimated that the due cause is to be measured by reference to the real, substantial, honest interests of the liquidation, and to the purpose for which the liquidator is appointed. Of course, fair play to the liquidator himself is not to be left out of sight, but the measure of due cause is the substantial and real interest of the liquidation.

Austin J applied the approach of Bowen LJ in Re Adam Eyton in Domino Hire Pty Ltd v Pioneer Park Pty Ltd (in liq) [2003] NSWSC 496; (2003) 21 ACLC 1330:

[58] The words "cause shown" indicate that a liquidator is not to be removed unless there is some ground for removal, and the ground must be established by evidence. However, "cause shown" is not a narrow concept. It is open to the applicant for removal to point to any conduct or inactivity on the liquidator's part that provides a basis for the conclusion that he or she should be removed, ranging from moral turpitude, to bias or partiality, lack of independence, incompetence or other unfitness for office. But the concept of "cause shown" is not limited to matters relating to the unfitness of the liquidator to hold office. In Re Adam Eyton Ltd; ex parte Charlesworth [1887] UKLawRpCh 148; (1887) 36 Ch D 299, speaking of a statutory formulation where the words used were "due cause shown" rather than "cause shown", Bowen LJ said (at 306) ... [see the passage just quoted]:

[59] In Network Exchange Pty Ltd v MIG Communications Pty Ltd (1994) 13 ACSR 544, Hayne J applied this test to an application for removal of an administrator, even though the statutory provision authorising the Court to remove an administrator (s 449B) does not contain the words "on cause shown". His Honour concluded that the absence of those words did not produce any marked difference, and he described the position as follows (at 550):

"In my view, however, it must be accepted that an order for removal should be made only if it is demonstrated that such an order would be for the better conduct of the administration. It is not to be contemplated that the power under s 449B is to be exercised save in circumstances that justify or require its exercise and those, speaking generally, would appear to be circumstances in which the order would conduce to the better conduct of the administration concerned."

[60] In cases where the applicant relies on misconduct by the liquidator, the words "cause shown" do not require the Court to work through each of the particulars of misconduct relied upon, and determine one by one whether they are made out. Young J (as the Chief Judge in Equity then was) rejected such an approach in Re Biposo Pty Ltd (1995) 17 ACSR 730. His Honour said (at 734):

"The question is not whether in adversarial litigation there has been proof of a case according to the heads particularized, ... but rather whether in the interests of the public the removal of the liquidator would be for the general advantage of persons interested in the winding up".

In Australian Securities and Investments Commission v Franklin [2014] FCAFC 85; (2014) 223 FCR 204 at [55], this Court applied the approach of Austin J in Domino Hire.

I conclude that the approach in the corporations cases to s 503 and its predecessors is apposite in relation to the removal and replacement of the trustee in bankruptcy under ss 90‑15 and 90‑20 of the Bankruptcy Schedule. The Court should exercise the power to remove and replace a trustee in bankruptcy in a manner which best advances the interests of the bankruptcy, having regard to the objects of the Bankruptcy Act. Having regard to s 1‑1(2)(b) of the Bankruptcy Schedule, the proper interests of the creditors of the bankrupt will be an important consideration.

(Emphasis added.)

1. Those principles are equally apt to apply in the context of bankruptcy: Borg at [33].

2. Fifthly, where the relationship between the trustee and the bankrupt "has totally broken down; that, in many cases, is a sufficient reason for the trustee to be removed": Doolan v Dare [2004] FCA 682 at [49] (Spender J); see also, eg, Trkulja v Morton [2005] FCA 659 at [4] (Gray J). Similarly, Jagot J held in Liprini v Pascoe as Trustee of the Bankrupt Estate of Liprini [2012] FCA 886; (2012) 292 ALR 778 at [22] (in the context of an application by the major creditor of the bankrupt estate under s 179 of the Bankruptcy Act) that:

[T]he powers to remove a trustee are not dependent on misconduct. There is ample authority that a breakdown in the relationship between at least the major creditor and the trustee may be sufficient, both for the purposes of an inquiry and for removal.

1. Sixthly, the mere breakdown in a relationship between the trustee and bankrupt will not always justify removal of the trustee. As Buchannan J held in Boensch v Pascoe [2007] FCA 1977 at [92]-[93] (also in the context of an application under s 179):

Obviously enough, a bankrupt should not be allowed, by an assiduous pattern of resistance to the trustee of his estate, to generate and then rely upon a suggested reason for removal thereby created. No doubt there are many instances in which disagreement may arise about the way a trustee is administering an estate or exercising his powers. Adequate opportunities exist for challenges to be made, if there are grounds for doing so. None have been made in the present case, save for the matters with which I am dealing.

It is clearly an insufficient ground for removal of a trustee that a bankrupt resists the proper administration of his estate or sets out to frustrate a trustee in the proper performance of his duties. Mr Boensch's obligation was to co-operate fully with his trustee. He is obliged to 'aid to the utmost of his power in the administration of his estate' (s 77(g)).

1. In other words, a bankrupt cannot, by their conduct in not cooperating with the trustee, cause a complete breakdown in their relationship, and then rely upon the breakdown as a basis upon which to remove the trustee: see also, eg, Trkulja at [62]. As will become apparent, the Trustee's case focused particularly around this last point.

2. Finally, the duties of the bankrupt are relevant to consider, as the Trustee's case largely centred on the multiple respects in which he alleged that Mr Mokhtar had failed to comply with those duties. These are enumerated in s 77 of the Bankruptcy Act and include the following:

(1) A bankrupt shall, unless excused by the trustee or prevented by illness or other sufficient cause:

(a) forthwith after becoming a bankrupt, give to the trustee:

(i) all books (including books of an associated entity of the bankrupt) that are in the possession of the bankrupt and relate to any of his or her examinable affairs; and

(ii) any passport or document issued for the purposes of travel held by the bankrupt; and

(b) attend the trustee whenever the trustee reasonably requires; and

(c) give such information about any of the bankrupt's conduct and examinable affairs as the trustee requires; and

(d) as soon as practicable after the later of the following times:

(iii) the time the bankrupt's statement of affairs was accepted under subsection 57B(1);

(iv) the time the bankrupt became a bankrupt;

advise the trustee of any material change that occurred between the time the statement was filed and the later of the times mentioned in subparagraph (i) or (ii); and

(bc) if a material change occurs at or after the later of the times mentioned in subparagraph (bb)(i) or (ii), advise the trustee of that change as soon as practicable after the change occurs; and

...

(e) execute such instruments and generally do all such acts and things in relation to his or her property and its realization as are required by this Act or by the trustee or as are ordered by the Court upon the application of the trustee; and

(f) disclose to the trustee, as soon as practicable, property that is acquired by him or her, or devolves on him or her, before his or her discharge, being property divisible amongst his or her creditors; and

(g) aid to the utmost of his or her power in the administration of his or her estate.

1. Ryan, Heerey and Allsop JJ (as his Honour then was) summarised the significance of s 77 of the Bankruptcy Act in Griffin v Pantzer [2004] FCAFC 113; (2004) 137 FCR 209 at [175] as:

Without that obligation the very ability of the trustee to perform his or her duties would be frustrated and made unworkable whenever the bankrupt had been or asserted that there was a risk of finding that he or she had been less than honest.

1. However, the ultimate question for me on the basis of the authorities to which I have referred is whether removal would be in the best interests of the bankruptcy.

1. It is in the light of these principles that the application of Mr Shin will be considered.

1. Firstly, the Court notes that the duty of a trustee is to "handle the assets with a view to achieving the maximum return from the assets to satisfy the claims of the creditors and provide the best surplus possible for the bankrupt": Mokhtar at [29] citing Mannigel v Aitken [1983] FCA 183; (1983) 77 FLR 406 at 408-9.
2. Courts should be cautious against undue interference in the administration of the bankruptcy: Mokhtar at [30]-[31].
3. Where the relationship between the trustee and the bankrupt "has totally broken down; that in many cases, is a sufficient reason for the trustee to be removed": Mokhtar at [37]. But a mere breakdown in the relationship between the trustee and the bankrupt will not always justify the removal of the trustee: Mokhtar at [38]. This is particularly the case where there is evidence which points towards the Bankrupt resisting the proper administration of the estate or setting out to frustrate a Trustee in the proper performance of their duties. A bankrupt has an obligation to cooperate fully with the Trustee and are obliged to aid to the utmost of their power the administration of the estate.
4. The applicant claims that his relationship with respondent has irretrievably broken down. What is clear however from an analysis of the correspondence is that as early as September 2024, the applicant unilaterally determined that he would no longer provide any requested information to the respondent. This was in circumstances where there was a clear lack of clarity in relation to various components of the applicant's complicated financial structures and involvement with multiple companies.
5. I am not satisfied that the applicant has been entirely honest and up front with the respondent. This is best demonstrated by his failure to declare the debt found by Katzman J in Sushi Bay to be payable to both the applicant and Rebecca Shin. There was also a complete lack of any clarity as to how the funds obtained from the sale of the family premises at Ryde for $4.9 million were allocated.
6. Further, the value of assets within the Shin Family Trust is entirely uncertain. It is somewhere from the region of $2 million to $29 million.
7. In these circumstances, it is not unsurprising that the respondent would have continued to have demanded further and additional documentation from the applicant. That documentation needed to be sufficient and clear as to establish what the relevant facts were in relation to the very complicated and convoluted financial structures that the respondent was involved with.
8. I am not satisfied that the initial statement of affairs lodged by the applicant was entirely true and correct. This then engendered a level of scepticism by the respondent and his employees, which justified the provision of further documentary evidence. The fact that very short time frames were provided for the production of that documentation does not reflect well on the respondent, however persistent failure to provide documentation by the applicant equally does not reflect well on him.
9. I consider it entirely convenient to the applicant, that having shortly after lodging his statement of financial affairs showing he had an income of $80,000.00 per annum, and a notice of contribution being issued, that his income reduced to $40,000.00 per annum, thus relieving him of the requirement to make a contribution. In this regard, I note that the applicant availed himself of the right to seek a review by AFSA. That review resulted in the contribution notice being withdrawn. This then is an example of the system working as it should. Of itself, this issue does not justify the removal of the respondent.
10. As to the applicant's complaints, I am satisfied that it was not unreasonable for the respondent to be initially sceptical as to whether or not the applicant possesses a Korean passport. The respondent was not prepared to accept oral assurances and required a statement in writing. In my view, this showed the respondent exercising proper care and diligence before accepting what the factual situation was.
11. I do not consider that the request that the applicant attend personally in an initial meeting with his Trustee in bankruptcy was so unreasonable as to warrant the removal of the Trustee. It is clear that the applicant had access to support which enabled him to travel to Melbourne, with his son, for the purposes of meeting with staff of his Trustee and handing over documents. This included his Australian passport. The applicant's complaint that a Victorian based Trustee was appointed to his estate failed to come to grips with the fact that the bankruptcy petition originated from Victoria and sequestration order was made by the Victorian registry of this Court. In those circumstances, it is entirely unsurprising that a Victorian based Trustee in bankruptcy was appointed. I do not consider this matter to weigh in favour of the removal of the respondent as Trustee.
12. The applicant takes issue with the lodgement of an Objection to his Discharge as a Bankrupt by the respondent. This took place in circumstances where as early as September 2024, the applicant, on his own admission, was determined not to further cooperate with the respondent or provide him with additional documentation. I do not think it is entirely inappropriate in those circumstances that the respondent would have lodged an objection. That objection was withdrawn after a further complaint to AFSA and the respondent indicated to the applicant that he was providing him with a further opportunity to cooperate in the administration of his estate by the provision of further documentation as set out in the correspondence provided to the applicant.
13. In submissions, counsel for the applicant suggested that the respondent had made a number of missteps and that it was damning, that in cross examination, he was not prepared to admit that he would have done anything different. This is perhaps a reflection of the Trustee in bankruptcy who is used to dealing with bankrupts who may not necessarily cooperate in a fulsome manner with the administration of the estate.
14. I am satisfied that the very early point of time, the applicant became unhappy at what he considered to be a disrespectful attitude by the respondent in a refusal to allow him to travel overseas within a very short period of time of him being made bankrupt and in circumstances where there was a large amount of documentation which still needed to be provided to the respondent. There is also an available inference that the applicant was unhappy with the manner in which the respondent and his employees were seeking to uncover what appeared to be the possibility that the applicant in fact had access to a large amount of funds or other assets through the Shin Family Trust. The vigour in which the respondent and his employees were pursuing this possibility, through the request of the significant amount of documentation, would no doubt have been great concern to the applicant, in circumstances where he may have been actively seeking to prevent those assets forming part of his bankrupt estate.
15. Even in circumstances where I could be satisfied that some of the communications from the respondent could have been better phrased and his actions better explained, I am not satisfied that the relationship between the applicant and the respondent was irretrievably broken down such that the respondent should be removed. Rather, I am satisfied that there has been a pattern of resistance to the Trustee by the applicant such as to give rise to grounds the applicant might then seek to rely upon reasons for the removal of the respondent. That is, the applicant has sought to create a circumstance where he might claim that his relationship with the respondent has broken down. Whilst AFSA have found that some of the complaints made by the applicant are justified, I am not satisfied that those matters of their own are such that would warrant the removal of the respondent.
16. I am further strengthened in this view that at no point in his correspondence to the respondent prior to initiating these proceedings did the applicant indicate what the respondent might do which would enable their relationship to be effectively reset, such as to enable the respondent to continue to effectively administer the applicant's bankrupt estate for the benefit of the creditors and the applicant.

1. In my view, insufficient grounds exist for the removal of the respondent as the applicant's Trustee in bankruptcy. The Application is dismissed.

I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment of Judge D Humphreys.