In brief: In two decisions arising from the Octaviar liquidation, the High Court has given guidance on liquidators' ability to seek extensions of time for bringing voidable transaction claims. The decisions also highlight the risks of such applications. Partner Christopher Prestwich (view CV) and Lawyer Julia Baine report.
HOW DOES THIS AFFECT YOU?
This week’s TGIF examines a High Court decision which confirmed the power of a court under s 588FF(3) of the Corporations Act to extend the time for the commencement of voidable transaction proceedings, without identifying the particular transaction or transactions to which the extension would apply.
In the latest chapter of the long running MFS/Octaviar liquidation, the High Court has recently clarified the extent to which liquidators can seek extensions of time to bring voidable transaction claims.
Can liquidators get a second extension that is sought out of time?
No.
On 11 March 2015, the High Court delivered the following significant decisions (Grant Samuel Corporate Finance v Fletcher [2015] HCA 8 and Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher [2015] HCA 10) in relation to s588FF(3) of theCorporations Act 2001 (Cth).
The latest statistics on companies entering external administration and insolvency appointments have been released by ASIC for the periods of December 2014 a
- On 11 March 2015, the High Court delivered its decision in Fortress Credit & Anor v Fletcher & Ors [2015] HCA 10.
- The appellant was Fortress Credit.
Summary
- On 11 March 2015 the High Court delivered its decision in Grant Samuel & Ors v Fletcher & Ors [2015] HCA 8.
- The appellants were Grant Samuel Corporate Finance Pty Limited and JP Morgan Chase Bank.
In Allco Funds Management Limited v Trust Co (Re Services) Ltd [2014] NSWSC 1251, an inter-company loan transaction was challenged by a receiver appointed by the secured creditor to one of the companies. Common directors were involved in the transaction. The issue was whether the directors breached their fiduciary duties entitling the company via the receiver to have the transaction set aside.
The background to the case
The Supreme Court of Victoria Court of Appeal recently handed down its decision in Dura (Australia) Constructions Pty Ltd (ACN 004 284 191) (In Liquidation)(Receivers and Managers Appointed) v Hue Boutique Living Pty Ltd (Formerly SC Land Richmond Pty Ltd) (ACN 106 117 506) & Ors [2014] VSCA 326, which dealt with the issue of whether a payment into court is a security interest for the purposes of the Personal Property Securities Act 2009 (Cth)(PPSA).