Document ID: chunk:federal_register_of_legislation:C2025C00167:section:185c:p1
Version: federal_register_of_legislation:C2025C00167
Segment Type: section
Provision Reference: s 185C (pt 1/5)
Character Range: 554918–557509

185C  Giving a debt agreement proposal to the Official Receiver

Giving a debt agreement proposal
 (1) A debtor who is insolvent may give the Official Receiver a written proposal for a debt agreement.

Requirements for a debt agreement proposal
 (2) A debt agreement proposal must:
 (aa) be in the approved form; and
 (a) identify the debtor's property that is to be dealt with under the agreement; and
 (b) specify how the property is to be dealt with; and
 (c) authorise a specified person (being a person who is the Official Trustee, a registered trustee or a registered debt agreement administrator and who is not the debtor) to deal with the identified property in the way specified; and
 (d) provide that:
 (i) all provable debts in relation to the agreement rank equally; and
 (ii) if the total amount paid by the debtor under the agreement in respect of those provable debts is insufficient to meet those provable debts in full, those provable debts are to be paid proportionately; and
 (e) provide that a creditor is not entitled to receive, in respect of a provable debt, more than the amount of the debt; and
 (f) provide that the amount of a provable debt in relation to the agreement is to be ascertained as at the time when the acceptance of the proposal for processing is recorded on the National Personal Insolvency Index; and
 (g) if a creditor is a secured creditor—provide that, if the creditor does not realise the creditor's security while the agreement is in force, the creditor is taken, for the purposes of working out the amount payable to the creditor under the agreement, to be a creditor only to the extent (if any) by which the amount of the provable debt exceeds the value of the creditor's security; and
 (h) if a creditor is a secured creditor—provide that, if the creditor realises the creditor's security while the agreement is in force, the creditor is taken, for the purposes of working out the amount payable to the creditor under the agreement, to be a creditor only to the extent of any balance due to the creditor after deducting the net amount realised; and
 (i) be signed by the debtor; and
 (j) specify the date on which the debtor signed the proposal.
 (2AA) A debt agreement proposal must not provide for the debtor to make payments under the agreement, in respect of provable debts in relation to the agreement, after:
 (a) 3 years beginning on the day the agreement is made; or
 (b) if subsection (2AB) applies to the debtor—5 years beginning on the day the agreement is made.
Note: Section 185H deals with when a debt agreement is made.
 (2AB)