On 7 December 2015, the Federal Government released the National Innovation and Science Agenda, delivering a range of new initiatives. Among the key focus areas, the Government highlighted insolvency law as a primary area overdue for reform. Whilst not introducing wholesale reforms to mimic the United States ‘Chapter 11’ framework, the targeted reforms seek to eliminate the stigma associated with business failure.

The assignment of debts is common in many transactions - from the sale of businesses to restructuring scenarios.

Assigning a debt requires written notice of the assignment being given to the debtor.  Under conveyancing legislation this notice can be given by either the assignor or assignee (for example, section 12 Conveyancing Act (NSW)).

Additional rules now apply for debts captured by the Personal Property Securities Act (PPSA).

Edgeworth Capital Luxembourg Sarl (2) Aabar Block Sarl V Glenn Maud [2015] EWHC 3464 (Comm)

The High Court in England has ruled on whether Spanish Law has the effect of extinguishing third party guarantees when the beneficiary of the guaranteed liabilities enters into insolvency proceedings in Spain.

In December 2015, as part of its National Innovation and Science Agenda, the Federal Government announced a proposal to introduce a ‘safe harbour’ for directors from personal liability for insolvent trading.

On 1 December 2015, we wrote about the decision of His Honour Judge Chivell of the District Court of South Australia in Matthews v The Tap Inn Pty Ltd [2015] SADC 108.

Marsden v Screenmasters Australia provides guidance to liquidators who commence and continue proceedings, pursuant to funding arrangements, when met with arguments that the proceedings will not confer a benefit to creditors. 

WHAT HAPPENED?

With the introduction of the unfair preference regime in the Corporations Act 2001, a short provision was included which stated:

“… a secured debt is taken to be unsecured to the extent of so much of it (if any) as is not reflected in the value of the security.”(section 588FA(2))

The provision has been rarely considered. There has been little case law providing any judicial interpretation of the subsection.

That is, until the Personal Property Securities Act 2009 (PPSA) commenced.

Have the tough times in the construction industry changed? It would appear not despite an uptick in the New South Wales economy. “I just want to be paid” is the title of the report just released by the Senate Economics References Committee.[1]

The Federal Government's NationalInnovationandScienceAgendawas announced on 7 December 2015.

The Australian Government has accepted certain recommendations of the Productivity Commission's long-awaited Report on Business Set-up, Transfer and Closure, in an attempt to change the focus of Australia's insolvency laws from "penalising and stigmatising business failure”, according to the Minister for Small Business and Assistant Treasurer, the Hon Kelly O'Dwyer MP.

It has expressed a willingness to legislate to introduce at least two main changes: