Former Government Senator Llewellyn Peniston's scheme of arrangement for paying more than $800,000 in debts was shot down by creditors at a meeting yesterday.

Twenty-five creditors submitted either proxies or a voting letter and as a result there was a total vote of 25 against the scheme and one in favour.

Official receiver Mr. Mark Diel, who called Mr. Peniston's scheme "unreliable'' said that the next step was to report to the Supreme Court.

"After reporting to the court it then becomes a matter for the court,'' Mr.

Diel said.

He added: "It appears that Mr. Peniston will probably be declared bankrupt by the Supreme Court. But that is a matter for the court.'' Mr. Diel also said that if that does take place, he does not believe Mr.

Peniston will need to be notified.

The main question that creditors wanted answered was how Peniston was able to go back to England with all his debts unmet.

Mr. Diel said that he too was surprised that Mr. Peniston was allowed to leave the country and in a letter to the Supreme Court he expressed his concern, especially with the fact that he was not notified.

"My concern arises from the fact that I was given no opportunity to consent to this course of action, or failing such consent, to make such submissions as I felt it my duty to make in order to carry out my obligations to the creditors and the court,'' he said. "I believe that the information has been given to the Registry in an erroneous form. Not having been afforded a copy of the information to the date hereof I am not able to say whether or not it provides the required information about Mr. Peniston's United Kingdom accounts.'' Mr. Diel also said that the court order of December 22, 1994, although as yet unperfected, was a valid and effective order.

He added: "I am therefore at a loss to understand on what basis the Court could be satisfied of Mr. Peniston's compliance given that there was no `evidence' before the Court of his proposed compliance with that order.

"I say `evidence' because in view of Mr. Peniston's admitted perjury and forging of documents I have severe reservations about the weight to be attached to any unsworn statement he makes.'' During court proceedings in December last year, Mr. Peniston failed to alert the official receiver when he discovered he had assets of $25,000 and $1,000.

And earlier Peniston had sworn an affidavit saying he had personal effects to a value of less than $1,000.