In a significant follow-on judgment the Court of Appeal has both clarified and moved beyond the High Court’s approach to the ‘no worse off’ test, but ultimately set aside the sanction of Petrofac’s proposed restructuring plans on fairness grounds.

Introduction

On 20 May 2025, Mr Justice Marcus Smith handed down his eagerly-awaited judgment sanctioning the two inter-conditional restructuring plans (the Plans) proposed by members of the Petrofac Group. The judgment raises issues described as “going to the heart of the Part 26A regime” and is significant as the first case to consider the application of the Court of Appeal’s ruling in Thames Water.

The judgment addresses three particularly interesting points:

On 8 April 2025, Mr Justice Marcus Smith delivered judgment granting Petrofac Limited and Petrofac International (UAE) LLC (the Plan Companies) permission to convene creditor meetings in respect of two inter-conditional restructuring Plans (the Plans). The fulsome judgment, following hearings on 28 February and 20 March, contains a number of interesting points:

Two recent Supreme Court of Canada decisions demonstrate that the corporate attribution doctrine is not a one-size-fits-all approach.

This week’s TGIF considers a recent decision of the Supreme Court of New South Wales (Forex Capital Trading Pty Ltd (in liquidation) v Invesus Group Limited [2024] NSWSC 867). Justice Ball determined that admission of a proof of debt by a liquidator was not akin to a judgment or settlement, and that such an admission did not create a new liability of the company.

In a recent decision of the Supreme Court of New South Wales (In the matter of Pacific Plumbing Group Pty Limited (in liquidation) [2024] NSWSC 525), Justice Black determined that a payment made by a third party was not an unfair preference because the payment did not diminish assets available to creditors.

Key Takeaways

The Federal Court in Morgan, in the matter of Traditional Values Management Limited (in liq)[2024] FCA 74, approved an abridged process that allowed the liquidator to admit debts of a group of unsecured creditors without requiring a formal proof of debt.

Key Takeaways

Court approval of a sale process in receivership or Bankruptcy and Insolvency Act (“BIA”) proposal proceedings is generally a procedural order and objectors do not have an appeal as of right; they must seek leave and meet a high test in order obtain it. However, in Peakhill Capital Inc. v.

In this week’s TGIF, we consider ASIC v Bettles [2023] FCA 975 and ASIC v Jones [2023] WASCA 130, two cases which bring into focus the conduct of insolvency practitioners and alleged abrogation of their duties and independence.

Key takeaways

In this week’s TGIF, we consider Jahani, in the matter of Ralan Property Services Pty Ltd (receivers and managers appointed) (in liq) [2023] FCA 738, a Federal Court decision approving the liquidators’ entry into funding agreements.

Key takeaways