The Court of Appeal has reversed the High Court’s decision in Healy Holmberg Trading Partnership v Grant on a PPSA issue it describes as being of “practical significance”. 

From 28 September 2012 the maximum priority amount for employees in liquidations, receiverships and bankruptcies will increase from $18,700.00 to $20,340.00 per employee.

Liquidators, receivers and the Official Assignee in a personal bankruptcy must pay certain amounts to employees, in priority to ordinary unsecured creditors. 

These preferential employee entitlements include:

The Law Commission is looking into whether the regulation of trading trusts gives enough protection to creditors and beneficiaries in circumstances of insolvency. 

Submissions are due on the issues paper by 2 March 2012.

What is a trading trust?

Big receiverships often test legal boundaries, and the Crafar group receivership is no exception.  Gibson & Stiassny v StockCo & Ors1  is the longest decision to date on the Personal Property Securities Act 1999 (PPSA). 

Although the facts are complex, the practical take-outs are fairly simple: