Hudson v Signalla [2015] FCAFC 140 confirms that leave of the court is not required under s58(3) Bankruptcy Act 1966 (Cth) to sue a former bankrupt in respect of what was a provable debt in the bankruptcy, after an annulment of the bankruptcy by way of a composition under ss73 and 74 of the Bankrupcty Act.

BACKGROUND

A bankrupt had his bankruptcy annulled by way of presentation of a composition that was accepted by participating creditors (Composition). 

The Corporations Act (the Act) permits a liquidator to claw back preferential payments made to an unsecured creditor within the six (6) month period prior to the winding up: section 588FA of the Act.

Update on McCabes' article " 'Are we there yet' - When are proceedings over for the purposes of enforcement"

The High Court of Australia has refused an application for special leave to appeal the decision of the Full Court of the Federal Court of Australia in Sarks v Cassegrain [2015] FCAFC 38, confirming that a judgment issued by the Court on the basis of filing of a certificate of costs assessment is a "final judgment" for the purposes of s 40(1)(g) of the Bankruptcy Act 1966 (Cth) and can therefore ground a bankruptcy notice.

Key Points:

A section 439A report must contain all material information which is known or reasonably ascertainable by administrators.

Victorian Supreme Court confirms that an application to set aside a statutory demand can be served electronically, and the Court’s evaluation of a genuine dispute concerns the establishment of a genuine level of claim, and not the likely result of the claim.

Background

In so far as they relates to creditor's statutory demands, the provisions of the Corporations Act 2001 (Cth) are construed by the courts particularly prescriptively.

On 5 June 2015, His Honour Justice Brereton delivered judgment in In the matter of Unity Resources Group Australia Pty Limited [2015] NSWSC 1174. This is another example of the technical application of these sections by the court.

BH Apartments v Sutherland Nominees [2015] VSC 381

The costs of ‘convening’. Whether the person requesting a meeting of creditors, pursuant to 5.6.15(1)(b) of the Corporations Regulations 2001 (Cth) be called is only liable for the costs of calling the meeting.

Sutherland Nominees Pty Ltd (Sutherland) was being administered pursuant to a deed of company arrangement under part 5.3A of the Corporations Act 2001 (Cth).

It is not uncommon for companies served with wind up proceedings to appoint external administrators for the purposes of investigating the affairs of the company and so that recommendations can be made to creditors to either have the company wound up, execute a deed of company arrangement or hand the company back into the control of directors.

In circumstances where the administrators conclude that the company should be wound up, it is common for the administrators to seek to be appointed as the official liquidators of the company.

A recent decision of the NSW Court of Appeal demonstrates the importance for security trustees tocarefully consider and understand their obligations in an enforcement scenario.

Need to know

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