Insights

Arrium court finds significant non-current liabilities not sufficient to prove insolvency

In a substantial recent decision arising from the Arrium liquidation , the Supreme Court of New South Wales considered the materiality of significant future liabilities in assessing the company’s...

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Peak Indebtedness Peaking Again? Special leave sought for High Court appeal

On 10 May and 24 June 2021, the Full Court of the Federal Court delivered unanimous judgments in Badenoch Integrated Logging Pty Ltd v Bryant, in which the Full Court held that the peak...

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Peak Indebtedness: In the Gunn

In a significant decision delivered on 10 May 2021, in which JWS acts for the plaintiff liquidators of the Gunns Group, the Full Federal Court in Badenoch v Bryant has declined to follow some six...

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“From the Company” after all: Liquidators claw back third party payments made during a DOCA

In the wake of the Victorian Court of Appeal’s decision in Cant v Mad Brothers Earthmoving [2020] VSCA 198 (‘Cant’), the Supreme Court of New South Wales’ recent decision in Re Western Port...

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Restructuring reforms – will the proposed two tier system avert the zombie apocalypse?

The Treasurer has announced major proposed reforms to Australia’s insolvency framework aimed at facilitating the restructuring of small to medium businesses (MSMEs) and streamlining their...

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Extension of temporary COVID-19 relief from insolvent trading liability and statutory demands

The operation of temporary COVID-19 relief measures for businesses in the hope of aiding distressed companies and preventing further economic breakdown will be extended until 31 December 2020.

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Lessors’ Priority Preserved: Implications for Post-Appointment Trading and DOCAs

In its recent judgment involving the PAS Group of companies , the Federal Court held that rent payable by the PAS Group during an extension of the period in which an administrator had been excused...

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COVID-19 and adjournment applications: balancing due process with flexibility and customisation

Recent decisions show that the courts will go to significant lengths to adapt procedures to continue with trial and appellate hearings despite COVID-19 related disruptions.

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Gunns liquidators prevail on peak indebtedness, set-off and the Court’s discretion

This week, the Federal Court published judgments in three unfair preference claims brought by the liquidators of the Gunns Group. We acted for the liquidators in each proceeding.

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Containing the COVID-19 contagion: temporary relief for financially distressed companies

The Coronavirus Response Bill provides, amongst other legislative amendments, for temporary changes of 6 months’ duration to Australian insolvency and corporations laws to assist in managing the...

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Fruit of the poisoned tree – examination summonses fatally tainted by improper purposes

This decision is an important reminder to liquidators to exercise their independent and professional judgment.

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A warning and opportunity for liquidators pursuing unfair preference claims

In its recent decision in the ongoing Solar Shop litigation, the Full Federal Court established two key principles which will have significant ongoing implications for the conduct of unfair...

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“Just and equitable” winding up: a viable cure for creditor distress and shareholder oppression

The Supreme Court of Victoria’s recent decision in Pacific Dairies Limited v Orican Pty Ltd illustrates judicial unwillingness to interfere in shareholder disputes, even in cases involving...

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Powers of attorney and step-in rights as security interests?

The status of power of attorney clauses and “step-in rights” provisions under the Personal Property Securities Act 2009 (Cth) (PPSA) remains an issue.

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A tip for liquidators of insolvent corporate trustees: appoint a receiver

How should the liquidator of an insolvent trustee company ensure payment out of trust assets of the entirety of his or her remuneration and expenses? According to the Federal Court , from the...

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Rising from the ashes - reintroduction of the Illegal Phoenixing Bill

Australia’s insolvency laws are changing, yet again.

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A matter of trust: High Court rules on distribution of assets of an insolvent corporate trustee

In its much anticipated decision, the High Court has unanimously dismissed the Amerind appeal.

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“Adding fuel to the fire”: Administrators fail in bid to adjourn winding-up of Paltar Petroleum Ltd

On 3 May 2019, the Federal Court of Australia dismissed an application brought by the administrators of an oil and gas exploration company, Paltar Petroleum Limited (Paltar) to adjourn proceedings...

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Distribution of trust assets under a DOCA: the latest guidance from the Federal Court

The Federal Court has confirmed that there is no difference between liquidation and deed administration of a corporate trustee in relation to dealings with trust assets and the distribution of...

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Set-off in unfair preference claims: In the matter of Cardinal Project Services Pty Ltd

The ability of creditors to rely upon the statutory set-off provision in section 553C of the Corporations Act to reduce or eliminate their exposure to unfair preference claims has been a matter of...

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The limits of an insolvency practitioner’s equitable lien: intermeddlers beware

The entitlement to recover remuneration and costs for work performed in conducting an external administration is an ever-present fundamental concern for insolvency practitioners.

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Green light for Gunns Group liquidators (and liquidators everywhere)

JWS has achieved an excellent result for the liquidators of the Gunns Group, with success in the Federal Court’s judgment in Bryant (Liquidator) v L.V. Dohnt & Co Pty Ltd, In the Matter of Gunns...

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Secured creditor claims to funds remaining after termination of DOCA – the latest word from the West

The recent Hughes decision illustrates the significance of PPSA security interests despite the existence and subsequent termination of a DOCA.

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The status of the trustee’s right of indemnity in the winding up of insolvent trustees – the latest

There is increasing importance for insolvency practitioners of pragmatic judicial application of equitable principles (rather than statutory priority rules) in seeking priority payment of their...

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Procedural fundamentals: extension of convening period for second creditors’ meetings

The factors which an administrator can cite in support of any extension application will necessarily depend upon the unique factual circumstances involved.

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