Hunt, in the matter of Hunt (Bankrupt) [2026] FCA 389

This Federal Court case was about a bankrupt individual who wanted permission to keep managing one specific company, SB Hunt Super Pty Ltd. That company did not run a trading business. Its only role was to act as trustee of the S B Hunt Self Managed Super Fund.

When Mr Hunt became bankrupt in November 2025, two separate legal consequences followed automatically. He became disqualified from managing corporations under the Corporations Act, and he also became a disqualified person under the SIS Act. That meant the company trustee structure for the SMSF could not continue in the ordinary way unless the Court intervened.

The Court did intervene, but only narrowly. It granted leave for Mr Hunt to manage that one company and ordered that he not be a disqualified person for SIS Act purposes, subject to strict conditions. The decision is useful because it shows both the seriousness of bankruptcy-related disqualification and the limited circumstances in which tailored relief may be available.

Mr Hunt had a long background as a professional company director and senior executive in public companies, mainly in the minerals, energy and technology sectors. Separately, he had an SMSF structure that had existed since 2010. The fund was originally established by Mr Hunt and his brother, who were the original trustees.

In 2019, Mr Hunt caused SB Hunt Super Pty Ltd to be incorporated. He was its sole director and shareholder. The trust deed was amended and a deed of removal and appointment of trustee was executed so that SB Hunt Super became the sole trustee of the fund. The company never carried on any other activity. Its sole purpose was to act as trustee of the fund.

The judgment records that the company’s activity was limited to acting as trustee of the self-managed superannuation fund of which Mr Hunt and his wife were the only members. The reasons also explain that, after the 2019 restructure, Mr Hunt had been the sole member in accordance with the SIS Act requirements for a self-managed superannuation fund with a corporate trustee that has a single director. The important practical point is that the Court treated the company as a single-purpose trustee vehicle and assessed the application on that basis.

The fund’s assets consisted mainly of shares in ASX-listed entities, including Sparc Technologies Ltd, of which Mr Hunt was a co-founder, and an interest in a non-listed company, TestInvest Pty Ltd. As at 30 June 2025, the audited value of Mr Hunt’s member balance was around $770,000.

The financial trouble that led to the case came from Mr Hunt’s personal tax affairs, not from misconduct in the operation of the trustee company. In November 2020, the ATO notified him that his personal income tax affairs for the 2008 to 2016 income years were under review. In October 2021, that review became a formal audit. The ATO concluded that he had not reported all income derived from offshore payments to Australia and domestic personal services income from directors’ fees. The amended assessments for unpaid tax, penalties and interest totalled $7,688,926.

After negotiations, Mr Hunt and the Commissioner entered into a deed of settlement in April 2023. Under that deed, he was to pay $3,214,630 by an initial instalment, seven half-yearly instalments and a final balance payment by 31 December 2026. He paid about $1.235 million, funded mainly by selling his former residential property in Unley and interests in listed entities. But the value of his assets fell sharply between 2023 and 2025, and he could not pay the fourth instalment due on 30 September 2024. He made proposals to renegotiate the settlement, but none was accepted.

He then tried a personal insolvency agreement under Part X of the Bankruptcy Act. A controlling trustee concluded that the proposal would return about 10.81 cents in the dollar to unsecured creditors. The Commissioner said he would not support it unless it offered at least 50 cents in the dollar, and ultimately voted against it at the reconvened creditors’ meeting in July 2025. Bankruptcy proceedings were later commenced by creditor’s petition, but before those proceedings concluded Mr Hunt lodged a debtor’s petition. It was accepted on 14 November 2025, and he became bankrupt.

Once Mr Hunt became bankrupt, the legal trigger points were immediate. Under the Corporations Act, an undischarged bankrupt is disqualified from managing corporations. Because of that disqualification, he also ceased to be director of SB Hunt Super. Under the SIS Act, he became a disqualified person because an undischarged bankrupt is an insolvent under administration for that legislation.

That mattered because the fund depended on a compliant SMSF trustee structure. The judgment explains that if a self-managed superannuation fund stops meeting the basic conditions, there is a six-month grace period before it ceases to be an SMSF, unless an RSE licensee is appointed earlier. In this case, if no orders were made, the fund would cease to be an SMSF on 14 May 2026.

The Court also explained the next layer of risk. If the fund ceased to be an SMSF, the Commissioner could later issue a notice stating that it was not a complying superannuation fund. If that happened, the fund would become a non-complying superannuation fund for tax purposes, with significant adverse tax consequences.

Mr Hunt therefore applied for two linked forms of relief. First, he sought leave under section 206G(1)(c) of the Corporations Act to manage SB Hunt Super. Second, he sought an order under section 126J(1)(b) of the SIS Act that he not be a disqualified person. He filed the application on 19 January 2026.

The procedural steps were important. Notice of the application was given to ASIC on 19 November 2025, as required for the Corporations Act relief. The application was served on the Commissioner on 22 January 2026 for the SIS Act relief. The Court then made directions requiring Mr Hunt to file written submissions and an affidavit of service, and to serve those materials and the Court’s orders on ASIC, his trustee in bankruptcy and all known creditors. The Court also gave any third party who wished to be heard, including ASIC and the Commissioner, an opportunity to appear and file evidence.

No one opposed the application. Pitcher Partners Adelaide said it had no objection. ASIC confirmed that it did not oppose the application. The Commissioner said he did not wish to be heard and neither consented to nor opposed the orders sought. No creditor filed a notice of appearance. The Court was satisfied that the relevant regulators and creditors were on notice and had not sought to resist the application.

The Court did not need to decide whether the disqualifications existed. They clearly did. The real question was whether the Court should exercise its discretion to make an exception to the ordinary consequences of bankruptcy.

For the Corporations Act application, the Court had power to grant leave to manage a particular corporation if the person was not disqualified by ASIC. For the SIS Act application, the Court had power to order that a person is not a disqualified person, and that order could be made subject to conditions.

The judgment drew on earlier authorities and said that the same broad principles applied to both discretions. The applicant bore the onus of showing that an exception should be made. Even without an opponent, the Court still needed evidence capable of justifying relief. The central considerations were the interests of third parties, the public at large, and the shareholders, creditors and employees of the relevant company.

The Court listed the kinds of matters that may be relevant, including protection of the public and shareholders, the nature of the disqualification, the applicant’s character and conduct since disqualification, the structure of the company and nature of the business, the potential for repetition of contraventions, the risk to the company’s survival, the effect on third parties if the company could not benefit from the applicant’s knowledge, and, where bankruptcy is involved, the circumstances in which the debts were not paid and the extent of cooperation with the trustee in bankruptcy.

The Court granted both forms of relief. It gave Mr Hunt leave to manage SB Hunt Super Pty Ltd under the Corporations Act. It also ordered that he not be a disqualified person for the purposes of the SIS Act. But the Court made clear that the orders had to be tailored closely to the limited purpose of the application.

The first condition was imposed on the company. Until Mr Hunt ceased to be a director of SB Hunt Super, or was no longer disqualified from managing corporations, SB Hunt Super could not engage in any activities other than acting as trustee of the S B Hunt Self Managed Super Fund and doing things reasonably incidental to that role.

The second condition was imposed on Mr Hunt personally. Until he was discharged from bankruptcy, he could not be or act as trustee, investment manager or custodian of any superannuation entity other than SB Hunt Super and the fund.

The reasons for granting relief were specific. The Court accepted that SB Hunt Super had always been limited to administration and management of the fund. Its structure was uncomplicated. It held no assets other than as trustee for the fund. It had no employees, no external creditors and no subsidiaries. Those features reduced the risk to the public and third parties.

The Court was also satisfied that Mr Hunt’s bankruptcy was not incurred as a result of dishonesty, fraud or intentional misconduct. The judgment says there was no dishonesty in his dealings with the ATO. He had made efforts to pay under the deed of settlement and to renegotiate it, but was ultimately unable to do so. The Court accepted that the circumstances of the bankruptcy did not suggest a significant risk of future contravention of the Corporations Act or the SIS Act if relief were granted.

Further, there was no reason to believe he would fail to comply with his obligations if the orders were made. He had cooperated with his trustee in bankruptcy. He had acted as trustee of the fund from 2010 to 2019 and then as director of the corporate trustee without incident. He had extensive experience in managing corporations and had never been the subject of any adverse finding or suggestion of impropriety. The period of relief was also finite, ending on discharge from bankruptcy.

The Court also accepted his evidence that there was no practical short-term alternative. He had explored moving the fund to a Small APRA Fund, but no SAF would accept the Sparc shares because Sparc was not part of the All Ordinaries Index and the shares would comprise more than 10% of the portfolio. Selling the shares to meet SAF requirements was said to be highly problematic because the fund held about 3.66 million Sparc shares and the stock had relatively low trading liquidity. The Court accepted that a sale in the short term would likely damage the share price and potentially harm Sparc and its other shareholders. That meant refusing relief could harm third parties as well as the fund itself.

Against that background, the Court concluded that it was appropriate to permit Mr Hunt to be the sole director of SB Hunt Super and not be a disqualified person for SIS Act purposes, so that the company could continue as trustee of the fund without the fund ceasing to be a complying superannuation fund.

This case is best read as a narrow example of court-supervised relief, not as a general comfort for bankrupt directors. The result turned on the unusual simplicity of the structure. SB Hunt Super was not a trading company. It had no employees, no external creditors and no business operations beyond acting as trustee of one fund. That made it easier for the Court to conclude that the public and third-party risk was low.

If your company trades, employs staff, deals with customers, borrows money or sits within a more complex group, the analysis may be very different. A court is likely to look much more closely at the risk to creditors, employees, investors and the public. Relief may be harder to obtain, narrower, or refused altogether.

The case also shows that personal tax disputes and insolvency can spill directly into governance. A founder or director may think of tax debt as a personal issue, but once bankruptcy occurs the legal consequences can remove them from office automatically. If a corporate trustee or sole-director structure depends on that person, the disruption can be immediate.

Timing is another practical point. The judgment explains that there was a six-month grace period before the fund would cease to satisfy the SMSF requirements. That is not a long time. If you wait until the end of a grace period, your options may be narrower and the practical alternatives may be worse.

Finally, the case underlines the importance of evidence. Mr Hunt succeeded because he put forward evidence about the company’s limited role, the source of the bankruptcy, his conduct, his cooperation with the trustee in bankruptcy, the regulator notifications, the position of creditors and why alternatives were impractical. If a business owner needs similar relief, the factual record will usually be decisive.

The judgment was delivered by McDonald J on 7 April 2026 in the Federal Court of Australia. The matter was determined on the papers. The Court recorded that Mr Hunt could expect to be automatically discharged from bankruptcy in November 2028.

The orders were operative immediately and were framed to last only within the limits stated in them. The leave to manage the company was tied to SB Hunt Super remaining a single-purpose trustee vehicle and to the period of disqualification under the Corporations Act. The SIS Act relief was tied to the period until discharge from bankruptcy.

For practical reading, that means the case is current authority for the proposition that the Court can grant tightly conditioned relief where a bankrupt person seeks to preserve a simple SMSF corporate trustee structure and the evidence supports a low-risk exception.

This page is based on the Federal Court of Australia decision Hunt, in the matter of Hunt (Bankrupt) [2026] FCA 389, delivered on 7 April 2026 by McDonald J. The judgment sets out the factual background, the legislative framework, the procedural steps, the positions of ASIC and the Commissioner, and the reasons for granting conditional relief.

This is general information only, not legal advice. Bankruptcy, director disqualification and SMSF compliance are highly fact-specific and can involve urgent deadlines.