In Official Assignee in Bankruptcy of the Property of Cooksley, in the matter of Cooksley v Cooksley, the Federal Court of Australia was asked to consider a letter of request from the New Zealand High Court for assistance under the Bankruptcy Act 1996 (Cth) and the Foreign Insolvency Act 2008 (Cth). By the letter of request from the High Court, the New Zealand Official Assignee sought assistance to enforce income contributions by a New Zealand bankrupt resident in Australia.
In granting the assistance sought (subject to certain undertakings being given by the Official Assignee), the Court held that it was bound to provide assistance, but the type of assistance it granted was discretionary. Relevant to the Court's decision to grant the assistance sought was the principle of comity between nations. A particular consideration was the fact that New Zealand and Australia shared essentially the same provisions regarding foreign bankruptcy assistance requests.
As the bankrupt's largest debt was a student loan debt, the Court also briefly considered the application of the prohibition on enforcing foreign taxation debt to assistance requests. In support of its decision to grant the assistance sought, the Court held that student loan debt was not a taxation debt. Furthermore, because the bankrupt had other debts, the Court would have been prepared to provide assistance even if it had considered student loans to be a taxation debt.
See Court decision here.