On 15 February 2012 the Commonwealth Government introduced the Corporations Amendment (Similar Names) Bill 2012.
Purpose
The purpose of this Bill is to amend the Corporations Act such that directors of failed companies can be jointly and individually liable for the debts of a company that has a similar name to a pre-liquidation name of a failed company.
The Bill itself is purportedly part of the Government’s election commitment from the Government’s Protecting Workers Entitlements Package announced in July 2010.
Statutory Demands pursuant to the Corporations Act are a mechanism available to creditors for the payment of debt. Upon the expiry of a Statutory Demand, the Corporations Act presumes that the company is insolvent and allows the entity making the demand to apply to the court for their winding up on grounds of insolvency.
Everything or Nothing! That is what the Queensland Court of Appeal has told us recently when it comes to assessing what a creditor is really owed for the purposes of standing to wind up a company
Background
A dispute arose between two parties involved in the management of Treadtel International Pty Ltd (Treadtel) whereby a Mr Cocco asserted that one of the two issued shares in Treadtel was held on trust for his benefit by the sole director’s wife, Mrs Crosher, because of an alleged share sale agreement.
Update: Re CMI Industrial Pty Ltd (In Liq); Byrnes & Ors v CMI Limited [2015] QSC 96
Receivers do not have to distribute profits from the sale of inventory acquired by them during their appointment to priority creditors.
The question of whether priority creditors have a statutory entitlement to receivers’ inventory trading profit has largely been left unanswered until the decision handed down by Justice Mullins on 27 April 2015.
The Supreme Court of Queensland decision of First Strategic Corporation Limited (In Liq) and Anor v Chan and Ors [2014] QSC 60 gives insolvency practitioners guidance as to what consideration can be taken into account when assessing the solvency of a company by the means and preparedness of someone to support the company.
Background
The decision in White & Anor v Spiers Earthworks Pty Ltd (SE) & Anor has examined the vesting provisions contained within the Personal Property Securities Act 2009 (Cth) (PPSA) and confirmed their effect where one party asserts to have an unperfected Security Interest at the time of an event of insolvency according to section 267 (2) of the PPSA.
Background
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