Insolvency Reforms Pass Parliament

Changes to Australia’s insolvency framework proposed by the Corporations Amendment (Corporate Insolvency Reforms) Bill 2020 (Cth) have been passed by Parliament and will be available for eligible small businesses from 1 January 2021. Our recent article addressing the proposed Bill can be viewed here. The legislation introduces a new, simplified debt restructuring process accessible by […]

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Small Business Insolvency Reforms – What this means for SME businesses as COVID restrictions ease and into the future

Following Treasury’s announcement on 24 September 2020 that it will introduce a suite of reforms to Australia’s insolvency framework, the Corporations Amendment (Corporate Insolvency Reforms) Bill 2020 (Cth) (Draft Bill) was released for public consultation between 7 and 12 October 2020, providing much needed clarity as to the practical effect of the insolvency reforms, which […]

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Court decides Cant can’t recover payment from related company as unfair preference

In the recent decision of Cant v Mad Brothers Earthmoving,[1] the Court of Appeal of the Supreme Court of Victoria (Justices Beach, McLeish and Hargrave) considered whether the liquidator of Eliana Construction and Developing Group (in liquidation) (Eliana) could establish that a payment made to an unsecured creditor of Eliana by one of Eliana’s related companies was […]

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Search and seizure application warranted: Illegal phoenix activity

The recent Federal Court decision of Scott v Southern Highlands Waste & Recycling Pty Ltd[1] provides liquidators with important guidance regarding the availability of search and seizure warrants under section 530C of the Corporations Act 2001 (Cth) (the Corps Act). Whilst the provision remains a useful mechanism for liquidators dealing with uncooperative directors, the Court has made it clear that warrants […]

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Solving the ‘classic insolvency conundrum’ – how should insufficient, comingled funds be distributed?

In Caron and Seidlitz v Jahani and McInerney in their capacity as liquidators of Courtenay House Pty Ltd (in liq) & Courtenay House Capital Trading Group Pty Ltd (in liq) (No 2),[1] the New South Wales Court of Appeal was faced with what it described as the ‘classic insolvency conundrum’: how to distribute funds to investors as equally […]

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New insolvency reforms to support small business recovery proposed to commence from 1 January 2021

The recently announced proposed insolvency reforms draw on key features from Chapter 11 of the Bankruptcy Code in the United States and aim to help more small businesses restructure and survive the economic impact of COVID-19. The reforms will cover around 76% of businesses subject to insolvencies today, 98% of whom have less than 20 […]

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The Singapore Convention Has Now Entered Into Force

Purpose One of the major roadblocks for parties contemplating mediation of cross-border commercial disputes has been the uncertainty, cost and/or delay in enforcing a breach of a term of mediated settlement agreement. This has often resulted in parties to a commercial cross-border dispute resorting to court/curial focused litigation or indeed foreign arbitral proceedings which are […]

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COVID-19 | Emergency Amendments to Insolvency Laws: What’s next?

In March, we reported that, as part of a suite of legislative and economic responses to COVID-19 the Commonwealth Government had announced a range of temporary amendments to certain insolvency laws. The amendments were aimed at temporarily amending insolvency laws, affecting in turn corporate governance, and directors’ duties. The purpose of the amendments was to […]

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Liquidators Be Aware – Statutory Demands and Personal Liability for Costs

In SJG Developments Pty Ltd v NT Two Nominees Pty Ltd (in liq),[1] the Supreme Court of Queensland set aside a statutory demand served by the liquidators of NT Two Nominees Pty Ltd (in liquidation) (NT Two Nominees) on SJG Developments Pty Ltd (SJG).  Costs were awarded on the indemnity basis and more significantly, were also ordered […]

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Liquidators in the ongoing Queensland Nickel Pty Ltd (In Liquidation) litigation fail to recover $102 million but are successful in their uncommercial transaction claims

In Parbery & Ors v QNI Metals Pty Ltd & Ors[1] the Court held, amongst other things, that: payments totalling $102 million from the bank account of Queensland Nickel Pty Ltd (In Liquidation) (QNI) to Mineralogy Pty Ltd (Mineralogy) were not recoverable by the liquidators of QNI as they were disbursements of the funds of QNI Metals […]

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Gunns ahoy: Federal Court reignites debate over the application of the peak indebtedness rule and set-off defence in unfair preference claims

In the recent Gunns decisions, the Federal Court considered three separate unfair preference claims brought by the liquidators of Gunns Limited (in Liquidation) (Gunns) against: Badenoch Integrated Logging Pty Ltd (Badenoch);[1] Bluewood Industries Pty Ltd (Bluewood);[2] and Edenborn Pty Ltd (Edenborn).[3] Badenoch, Bluewood and Edenborn each received significant sums from Gunns during the relation-back period and evidence available […]

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Webinar | The Butterfly Effect – insolvency, class actions and government

Challenging economic times inevitably lead to increased litigation, from which government is not immune whether in the enforcement of powers or contracts or in the defence of ambit claims. This session examines recent changes in the current environment, exacerbated by COVID-19 challenges to the content of laws and the practical administration of justice and the […]

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