This week’s TGIF article looks at the decision of Hooke v Bux Global Ltd (No 6) [2018] FCA 1545, where Bux Global Ltd (Bux Global) was wound up on just and equitable grounds and the perceived independence of a director-appointed liquidator was questioned.

Background

This week’s TGIF considers the case ofIn the matter of Bean and Sprout Pty Ltd [2018] NSWSC 351, an application seeking a declaration as to the validity of the appointment of a voluntary administrator.

What happened?

On 7 December 2018, Mr Kong Yao Chin (Chin) was purportedly appointed as the voluntary administrator of Bean and Sprout Pty Ltd (Company) by a resolution of the Company.

This week’s TGIF considers whether a flexible payment arrangement between a subsidiary and its holding company creditor meant the parent suffered no loss on the insolvency of the subsidiary.

What happened?

On 17 August 2017, the West Australian Court of Appeal published its reasons in Perrine v Carrello [2017] WASCA 151 drawing a close to the long-running dispute between the Perrines and the liquidator (Liquidator) of their failed pod-home building company (PodCo).

This week’s TGIF considers the application of the principle in Re Universal Distributing and whether liquidators may claim an equitable lien to recover their costs and expenses, even if no assets are realised and no fund exists.

Background

In the recent Court of Appeal decision of Primary Securities Ltd v Willmott Forests Limited, liquidators had been appointed to an insolvent company which was the responsible entity of a managed investment forestry scheme.

This week’s TGIF considers Legend International Holdings Inc (In Liquidation) v Indian Farmers Fertiliser Cooperative Ltd & Kisan International Trading FZE [2016] VSCA 151 in which it was held that s 581 does not prohibit a winding up order where Chapter 11 proceedings are on foot.

What happened?

WHAT HAPPENED?

In April 2013, the liquidators of Akron Roads Pty Limited (in liq) (Akron Liquidators) commenced proceedings against three former directors including Trevor Crewe (an Akron Director) and Crewe Sharp Pty Ltd (an alleged de-facto director) (the Directors) for breaches of the insolvent trading provisions of the Corporations Act 2001 (the Act).

BACKGROUND

Stephanie Roebuck As Executor Of The Deceased Estate Of Suzanne Florence Bulwinkel (Roebuck) served Bulwinkel Enterprises Pty Ltd (Bulwinkel) with a statutory demand for the payment of $990,377.63 monies owing in connection with an unpaid trust distribution and loan between the parties. 

In the decision of Saker, in the matter of Great Southern Limited[2014] FCA 771, the Federal Court of Australia held that statutory obligations, not trust obligations, require receivers and liquidators to hold and apply funds for the benefit of employees pursuant to s 561 of the Corporations Act 2001 (Cth).

FACTS

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.

This week’s TGIF considers a recent decision of the NSW Supreme Court by which two DOCAs were terminated with the deed fund transferred to liquidators for the ultimate benefit of the secured creditor and, indirectly, the proponent of the deeds.

Key Takeaways