Two critical components affecting liquidators have come out of Tuesday’s decision by Brereton J in the NSW Supreme Court.
The recent decision of the Federal Court of Australia in Australian Securities and Investments Commission v Dunner [2013] FCA 872 has resulted in an order that Melbourne insolvency practitioner Andrew Dunner repay over
$600,000.00 in remuneration and be prohibited from practicing as a liquidator for a period of five years.
In the matter of Dalma No 1 Pty Ltd (in liquidation) (ACN 111 772 260)1 (Dalma) acts as a cautionary warning to third party donors of liquidated companies that pay amounts to creditors on behalf of the liquidated company and then seek to be subrogated to a priority position under the Corporations Act 2001 (Cth) (CA
The recent decision of Lewis v Nortex Pty Limited (in liquidation)1 highlights potential issues that may arise for liquidators when issuing a bankruptcy notice.
Facts
Nortex Pty Ltd (Nortex) was the trustee of the Nortex Unit Trust (Trust) pursuant to a deed. Under the terms of the trust deed, Nortex ceased to be trustee when the company went into liquidation. The beneficiaries of the trust were Kation Pty Ltd (Kation) which was controlled by the appellant (Lewis) and Lamru Pty Ltd (Lamru).
Public comment on the exposure draft of the Insolvency Law Reform Bill 2013 has now closed. Sixteen submissions were received in response to the long awaited draft.
While one submission was confidential, the remaining 15 can be viewed here.
The decision of Fielding as Liquidator of Lyngray Developments Pty Ltd (In Liquidation) v Dushas & Anor [2013] QCA55, overturned a Judgment at first instance where it was held that various payments made by a company to a close associate of a director of a company were not unreasonable director related transactions pursuant to Section 588 FE(6).
The Court of Appeal held that the payments did constitute unreasonable director related transactions and this decision provides guidance as to:
The decision of Austino Wentworthville Pty Ltd v Metroland Australia Limited & Ors [2013] NSWCA 59 was an appeal brought by Austino against Metroland and its voluntary administrator Mr Levi (“Levi”) to amend a proof of debt for the purpose of voting at a meeting of creditors in a voluntary administration.
The decision is relevant to insolvency practitioners who act as voluntary administrators in assessing voting entitlements in the voluntary administration process in addition to creditors who offer assets as security to obtain finance.
Background
The Full Court of the Federal Court of Australia recently affirmed the decision of Justice Barker in disallowing Mr Oswal, the director of Burrup Holdings Limited (BHL) and Burrup Fertilisers Pty Ltd (Receivers and Managers Appointed) (BFPL) access to certain books and records of the companies.
An exposure draft of the long anticipated Insolvency Law Reform Bill 2013 has been released for public comment. The Bill aims to: