The Federal Court takes aim in Gunns – and extinguishes the Peak Indebtedness Rule in Australia
On 10 May 2021 in Badenoch Integrated Logging Pty Ltd v Bryant, in the matter of Gunns Limited (in liq)(receivers and managers apptd)[i] the Full Court of the Federal Court of Australia abolished the application of the Peak Indebtedness Rule to a running account ‘single transaction’ under section 588FA(3) of the Corporations Act 2001 (Cth) […]
ReadmoreUlterior motives and personal interests lead to setting aside of Public Examination Order
In ACN 004 410 833 Ltd (formerly Arrium Limited) (in liq) v Michael Thomas Walton & anor,[1] the New South Wales Court of Appeal considered the purpose for which public examination summons and production of documents can be ordered. Drawing on authorities that the predominant purpose of a public examination should be for the benefit […]
Readmore“Don’t let perfect be the enemy of the good”: Court approves pragmatism in liquidators entering into Deed of Settlement
In Re Octaviar Ltd,[1] the Supreme Court of Queensland has given a recent example of a settlement considered too ‘good’ to approve, even while noting its failure to achieve perfection. Where a settlement will significantly progress two very lengthy liquidations and save value for creditors by avoiding further costs and delay, the Court is prepared […]
ReadmoreOverturning Orders for Possession on appeal – beware of an appellant’s new evidence and new contentions
In De Pasquale v ASCF Managed Investments Pty Ltd,[1] an appeal was brought against an Order for Possession made by a Master of the Supreme Court of South Australia on 19 December 2019 against the appellants’ property. In the appeal, Justice Livesay of the Supreme Court of South Australia considered the following: whether it was […]
ReadmoreThe Federal Court demonstrates the flexibility and breadth of orders under section 90-15 of the Insolvency Practice Schedule in a voluntary administration
In Krejci, in the matter of Union Standard International Group Pty Ltd,[1] the Federal Court provides an example of the ways in which section 90-15 of the Insolvency Practice Schedule[2] (IPS) can be used to craft orders that balance the interests of the company, creditors and third parties. Background The applicants were the voluntary administrators […]
ReadmoreRe Cullen Group: When not contesting an application and agreeing to abide an order of the court can be… costly
In Re Cullen Group,[1] the Supreme Court of Queensland considered the determination of a preliminary question regarding the insolvency of Cullen Group Australia Pty Ltd (Cullen Group), which was placed into liquidation approximately four years prior to the hearing date. The issue of insolvency was relatively uncontroversial and, as noted by Justice Martin, “was not […]
ReadmoreQueensland Court of Appeal rejects ‘IOU’ as payment for debt
In Bayly v Westpac Banking Corporation[1], the Queensland Court of Appeal dismissed an appeal against a summary judgment granted in favour of Westpac Banking Corporation (Westpac). Whilst there were broadly, two grounds of appeal, the appellant was self-represented and raised numerous issues and alleged errors of law and fact made by the primary Judge. The […]
ReadmoreTravelling / moving overseas while bankrupt
In Moltoni v Macks as Trustee of the Bankrupt Estate of Moltoni (no 2) [1] the Federal Court of Australia considered a bankrupt’s application for review of the Bankruptcy Trustee’s decision not to allow him to leave Australia and live in the UK. Although there were doubts about the bankrupt’s assistance to date with the Trustee’s investigations, […]
ReadmoreMortgagee Beware of Equitable Lienees
In Condon, in the matter of Rayhill v Australia and New Zealand Banking Group Ltd[1], Justice Stewart resided over an application for summary dismissal brought by ANZ against Condon, a trustee in bankruptcy and equitable lienee, and considered: Whether an equitable lienee had standing in equity and under section 111A of the Conveyancing Act 1919 (NSW) (Conveyancing Act) to […]
ReadmoreSmall Business Insolvency Law Reform: One size does not fit all
On 1 January 2021, a number of changes to Australia’s insolvency framework came into effect, pursuant to the Corporations Amendment (Corporate Insolvency Reforms) Act 2020 (Cth) (the Act). The reforms, which were first announced by the Government in September 2020, replace the former ‘one size fits all’ insolvency approach under the Corporations Act 2001 and introduce further alternatives for […]
ReadmoreInsolvency 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 […]
ReadmoreSmall 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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