Recently, government introduced a new draft law on the reform of the Bankruptcy Act and the Law regarding the Continuity of Enterprises (LCE).
The draft law still needs to be approved by the Federal Parliament, but it is expected to come into effect no later than 1 September 2017.
The current legislation on insolvency will be made up to date and adapted to European Regulations. Moreover it will be incorporated into the Code of Economic Law to make it a coherent set.
Below is a brief overview of the main new elements of the law.
This week’s TGIF considers Linc Energy Ltd (in Liq) v Chief Executive Dept of Environment & Heritage Protection [2017] QSC 53, in which the Queensland Supreme Court directed that the liquidators of Linc Energy were not justified in causing it to fail to comply with an environmental protection order
BACKGROUND
This week’s TGIF considers an objection by directors and related-party creditors to a liquidator retaining solicitors who had previously acted for a substantial creditor in proceedings against the company.
What happened?
On 15 August 2016, a statutory demand was issued to the operator of a Chinese dumpling restaurant. The restaurant operator failed to comply with the demand and was wound up by order of the Court. The petitioning creditor also obtained orders for the appointment of a liquidator to the restaurant operator.
A recent Victorian Supreme Court decision has resulted in the Commonwealth losing priority status for some $3.8m paid to the employees of a collapsed company, due to an unusual gap in the priority regime created under the Corporations Act.
This week’s TGIF considers a recent Federal Court decision in which relief was sought under section 588FM of the Corporations Act to ensure a security interest perfected after the ‘critical time’ did not automatically vest.
What happened?
On 7 April 2016, administrators were appointed to OneSteel. OneSteel, a member of the Arrium Group of Companies, subsequently entered into a deed of company arrangement.
As from 1 April 2017, Bankruptcy files will be held and followed up entirely electronically in the Central Insolvency Register.
Any bankruptcy that will be declared open as from 1 April 2017, has to be registered and kept in the Central Insolvency Register instead of the Commercial Courts Registry.
The Central Insolvency Register, hereinafter referred to as "the Register", is the computerized database in which bankruptcy files are registered and retained (www.regsol.be).
This week’s TGIF considers the case of In the matter ofCNL Transport Pty Ltd (in liq) [2017] NSWSC 291, where the New South Wales Supreme Court terminated a liquidation where the company was solvent and its debts had been paid.
Background
A company was wound up by the Court on 27 February 2017 following its failure to comply with a creditor’s statutory demand. The statutory demand had been issued by an insurer in respect of unpaid workers’ compensation insurance premiums.
This week’s TGIF considers Fordyce v Ryan & Anor; Fordyce v Quinn & Anor [2016] QSC 307, where the Court considered whether a beneficiary’s interest in a discretionary trust amounted to ‘property’ for the purposes of the Bankruptcy Act 1966 (Cth).
BACKGROUND
This week’s TGIF considers a decision of the Victorian Supreme Court which examined the merits of appointing special purpose liquidators in circumstances where a creditor was only willing to fund investigations if the appointment was made.
What happened?
In May and June 2016, two registered education and training organisations (together, the RTOs) were placed into liquidation.
This week’s TGIF considers the application of the principle in Re Universal Distributing and whether liquidators may claim an equitable lien to recover their costs and expenses, even if no assets are realised and no fund exists.
Background
In the recent Court of Appeal decision of Primary Securities Ltd v Willmott Forests Limited, liquidators had been appointed to an insolvent company which was the responsible entity of a managed investment forestry scheme.