A guarantor's liability under a revocable, divisible continuing guarantee for goods supplied after the date of bankruptcy (or Personal Insolvency Agreement) is not a provable debt under s 82(1) of the Bankruptcy Act 1966 (Cth), because no obligation upon which a contingent liability is founded exists prior to the date of bankruptcy in respect of those supplies. The decision in Proud v Brims Distributors Pty Ltd [1996] NSWCA 439 to the contrary should not be followed. The position would be different if the guarantee were irrevocable.
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