This week’s TGIF examines a recent decision of the New South Wales Court of Appeal in Hosking v Extend N Build Pty Limited [2018] NSWCA 149, which considered whether payments made by a third party to an insolvent company’s creditors could be recovered by the liquidator as unfair preferences.

What happened?

The respondent in this matter, Mr Culleton, owed Macquarie Leasing Pty Limited (Macquarie) a debt arising out of two chattel mortgage agreements.

Macquarie obtained judgment against Mr Culleton in the amount of $94,304. The judgment debt was not paid and Macquarie petitioned for a sequestration order to be made against Mr Culleton’s estate.

Macquarie served the Bankruptcy Notice on Mr Culleton by affixing it to a padlocked gate at his last known address.

The recent WA Supreme Court decision in White v Spiers Earthworks Pty Ltd [2014] WASC 139, highlights the consequences of not registering a security interest under the Personal Property Securities Act 2009 (PPSA) when a company becomes insolvent.

The case also provides guidance about certain PPSA savings provisions, the treatment of transitional security interests and the primacy of PPSA over pre-PPSA legislation.

BACKGROUND

The recent Federal Court of Australia (Court) decision Hird, in the matter of Allmine Group Limited (Administrators Appointed) (Receivers and Managers Appointed) [2013] FCA 748 involved an application for an extension to the convening period.

Facts

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

This week’s TGIF considers a recent application for injunctive relief by a bankrupt to restrain liquidators who initiated his examination from continuing to retain their lawyers, given the firm had previously represented the examinee.

What happened?

On 8 August 2016, Richard Nash became bankrupt, on his own petition, and was later served with a summons for examination and orders for the production of books and records.

This week’s TGIF considers In the matter of Arrium Limited [2018] NSWSC 747 in which the Court granted creditors access to documents produced in public examinations.

What happened?

FACTS

InKitay, in the matter of South West Kitchens (WA) Pty Ltd [2014] FCA 670, Mr Kitay was appointed liquidator of South West Kitchens (WA) Pty Ltd (SW Kitchens) by voluntary winding up. SW Kitchens was trustee of a trust and owned all its assets as trustee of that trust. The trust deed provided that SW Kitchens was disqualified from acting as trustee if it was wound up.

In DSG Holdings Australia Pty Ltd v Helenic Pty Ltd [2014] NSWCA 96, the Court of Appeal considered the meaning of the “interests of the creditors as a whole” under section 600A of the Corporations Actand the circumstances in which the Court will intervene to set aside or impose conditions on resolutions passed at creditors meetings.

BACKGROUND

The recent Supreme Court of New South Wales decision of In the matter of Octaviar Administration Pty Limited (in liquidation) [2013] NSWSC 786 confirms that liquidators must notify all interested parties prior to seeking an extension for the period in which to bring preference actions.  For the first time, the Court has confirmed that the directors of the insolvent company are “interested persons” in cases where a liquidator intends to pursue the Australian Taxation Office (ATO) over potential preferential payments based solely on the potential for the ATO to