The Federal Court decision of Crumpler (as liquidator and joint representative) of Global Tradewaves Ltd (a company registered in the British Virgin Islands) v Global Tradewaves (in liquidation), in the matter of Global Tradewaves Ltd (in liquidation)[2013] FCA 1127 provides an illustrative example of the way that cross border insolvency recognition can be used to aid a foreign administration.

Facts

BACKGROUND

The company P Hindle & Co Pty Ltd (WA) was placed in liquidation in 2008. Mr Huxtable was appointed as liquidator of the company (Liquidator). The Liquidator acted as chairperson at a meeting of creditors in late 2010 where 4 out of a potential 161 creditors attended.

After nearly 20 years, the long running Bell litigation is almost over, with the Supreme Court of Western Australia having approved the settlement between the liquidators of the Bell group of companies and the syndicate of banks involved in the litigation (Re Bell Group (In Liq); Ex Parte Antony Leslie John Wooding as Liquidator of the Bell Group Ltd (In Liq) [2013] WASC 409).

BACKGROUND

In its recent judgment of Morgan,In the matter of Brighton Hall Securities Pty Ltd (in liquidation) [2013] FCA 970, the Federal Court of Australia determined that a liquidator is entitled to retain certain remuneration and other expenses from the proceeds of a claim under a professional indemnity insurance policy in preference to claimants, who would otherwise have a statutory priority under section 562 of the Corporations Act.

BACKGROUND

In New Age Constructions (NSW) Pty Ltd v Etlis, in the matter of Etlis[2013] FCA 884, an unsecured creditor applied to set aside a Personal Insolvency Agreement (PIA)and also sought a sequestration order against the debtor’s estate.  The Federal Court considered whether the terms of the PIA were unreasonable or not calculated to benefit creditors generally.

In Lehman Brothers Australia Limited, in the matter of Lehman Brothers Australia Limited (in liquidation) (No 2) [2013] FCA 965, the Federal Court again confirmed that schemes of arrangement are a viable restructuring tool to compromise claims involving a class of creditors and third parties.

BACKGROUND

Section 560 of the Corporations Act provides that a person who loans money to a company in liquidation, for the purposes of making a payment towards employee wages and other employee benefits, will have the same right of priority as the employees would have had in the winding up of the company.

In the decision of Allied Express Transport Pty Ltd v Exalt Group Pty Ltd (Administrator Appointed) (No 2) [2013] FCA 477, Exalt Group Pty Ltd (Exalt) sought an adjournment of a winding up application under s440A(2) of the Corporations Act on the basis that the creditors had voted by a majority in favour of a resolution that Exalt enter into a DOCA.

The recent Federal Court of Australia (the Federal Court) decision of Ackers v Saad Investments Company Limited [2013] FCA 738 considered whether the Australian Commissioner of Taxation (the Commissioner) could collect part of an AUD $83,271,545.70 debt owed by Saad Investments Company Limited (in official liquidation) (Saad) from Saad’s Australian assets, before those assets were remitted to the Cayman Islands for distribution in Saad’s ‘foreign main proceeding’.

Facts

In two recent Federal Court decisions, Chan v Four C Realty Pty Ltd (in liq), in the matter of Four C Realty Pty Ltd (in liq)[2013] FCA 928 and Chan v Four C Realty Pty Ltd (in liq), in the matter of Four C Realty Pty Ltd (in liq) (No 2)[2013] FCA 959, the Court considered the circumstances in which it will or will not interfere with the commercial judgment of a liquidator.