This week’s TGIF article considers the case of Re Watch Works Australia Pty Ltd (in liq) & Anor; Ex Parte Francis & Ors [2020] WASC 6, in which the Supreme Court of Western Australia determined two linked companies were to be a ‘pooled group’ in order to satisfy the external debts payable by both companies.

What happened?

Courts struggled last year to find a balance between state-licensed cannabis activity and the federal right to seek bankruptcy protection under the Bankruptcy Code. During 2019, we had the first circuit-level opinion in the bankruptcy/cannabis space that appeared to open the door to bankruptcy courts, albeit slightly. We also had lower court opinions slamming that door shut.

Below, we look at a few of the most important decisions issued throughout 2019 and analyze the current state of the law.

The Ninth Circuit's Garvin Decision

Courts struggled this year to find a balance between state-licensed cannabis activity and the federal right to seek bankruptcy protection under the Bankruptcy Code. During 2019, we had the first circuit-level opinion in the bankruptcy/cannabis space that appeared to open the door to bankruptcy courts, albeit slightly. We also had lower court opinions slamming that door shut. Below, we look at a few of the most important decisions issued throughout 2019 and analyze the current state of the law.

The Ninth Circuit Court of Appeals’ Garvin Decision

This week’s edition of TGIF considers the landmark decision of the High Court in BMW Australia Ltd v Brewster; Westpac Banking Corporation v Lenthall[2019] HCA 45 and what it might mean for insolvency practitioners.

Decision

This week’s TGIF considers the latest decision in Arrium and the recent refusal by the Supreme Court of New South Wales to set aside, on Arrium’s application, a summons for examination to a former director.

What happened?

On 15 May 2019, a Registrar issued a summons for examination and orders for production to a former director of Arrium following an application by two shareholders of the company. The shareholders had been authorised as eligible applicants by the ASIC the previous year.

This week’s TGIF considers the decision in Adelaide Brighton Cement Limited v Concrete Supply Pty Ltd (Subject to Deed of Company Arrangement) (No 4)[2019] FCA 1846, where the Court terminated a deed of company arrangement in circumstances where the administrators had not undertaken sufficient investigations.

Background

On 4 November 2017, administrators were appointed to Concrete Supply Pty Ltd.

This week’s TGIF considers a recent application by a liquidator to the NSW Supreme Court for directions regarding the sale of trust property where the trust deed could not be found.

Background

This week’s TGIF considers a recent Federal Court decision where the Court found a company’s general purpose liquidators had not acted unreasonably in opposing an application that special purpose liquidators also be appointed.

Background

This week’s TGIF considers a recent decision of the Supreme Court of Western Australia regarding an application for a company to be wound up under s 459P of the Corporations Act or, alternatively, on just and equitable grounds.

What happened?

In another loss for the cannabis industry, a district court recently affirmed the dismissal of chapter 11 petitions filed by companies that sold product used by both state-licensed marijuana growers and non-marijuana growers. The district court’s decision in Way to Grow, Inc. demonstrates that the door that was opened by the Ninth Circuit in Garvin v. Cook Invs.