Sometimes, bankrupts transfer or assign assets to others
in an attempt evade their creditors, or
in an attempt to preserve an asset that would otherwise be
available to be sold to satisfy the debts
(lawyers call this things like "actions in in contemplation of bankruptcy").
Such cases can give rise to a set of transactions called (for short) "clawback".
Perhaps the Trustee thinks that the vehicle was transferred to you
as a way to conceal it, and/or evade having to sell it to satisfy the debt(s).
At the very least, they will want to satisfy themselves that this is not the case.
For you, it may be more complex.
You say that you loaned this person money, using the car as security.
What records/ documents do you have that shows the existence of this arrangement?
Is there, you know, a proper loan contract?
Do you know if anyone else had an interest in the car? Other lenders perhaps?
For example, was the car also "under finance" as security in a retail consumer loan?
Was it also (and perhaps in a separate contract) security on, say, a business loan?
How close in time, fact and circumstances to the bankruptcy did the surrender of the car happen?
Then, there's the question of priority of debts in bankruptcy.
As a matter of law, some creditors get priority - debts to the ATO, for example.
So, you may not be the one who has "first dibs" on the car anyway.
I strongly suggest that you get formal, case specific legal advice.
