This week’s TGIF considers a recent Federal Court of Australia decision (Connelly (liquidator) v Papadopoulos, in the matter of TSK QLD Pty Ltd (in liq) [2024] FCA 888). In the case, it was determined that a restructuring adviser who engineered an asset-stripping scheme may be found liable for the full value of the loss arising out of the scheme.

Key Takeaways

This Quickguide outlines some practical considerations for companies whose contractual counterparties are experiencing financial distress, including what questions may be asked of the counterparty in relation to its distress and how to negotiate payment terms or recover debts.

1. Overview

This week’s TGIF summarises the Federal Court of Australia’s recent decision granting leave to proceed against a company despite the appointment of a small business restructuring (SBR) practitioner under Pt 5.3B of the Corporations Act 2001 (Cth) (Corporations Act).

Key takeaways

The Government intends to enhance the UK's cross-border insolvency regime with the adoption of the UNCITRAL Model Law on Enterprise Group Insolvency (MLEG) and, after further consideration, Article X of the UNCITRAL Model Law on Recognition and Enforcement of Insolvency-Related Judgments (MLIJ).

Government concludes that the permanent Corporate Insolvency and Governance Act 2020 measures have been "broadly welcomed", although possible refinements identified A 'Post-Implementation Review' carried out by the Insolvency Service has concluded that the restructuring plan, the standalone moratorium, and the suspension of contractual termination (ipso facto) measures introduced by the Corporate Insolvency and Governance Act 2020 (CIGA) have all been broadly welcomed by stakeholders and are seen as positive additions to the UK's insolvency and restructuring framework.  The review

An interim government report has concluded that the restructuring plan, the standalone moratorium, and the restriction on contractual termination (ipso facto) measures introduced by the Corporate Insolvency and Governance Act 2020 (CIGA) satisfy their policy objectives. The report is part of the statutory review which must be carried out within three years of the measures coming into force.

In a dramatic reversal of restructuring plan fortunes, HRMC recently successfully challenged two independent mid-market Part 26A Companies Act 2006 restructuring plans: the Nasmyth Group Limited Restructuring Plan (the Nasmyth RP) and the Great Annual Savings Company Ltd Restructuring Plan (the GAS RP). To date, only one other restructuring plan has been refused sanction.

German real estate group restructuring plan sanctioned in London

Having failed to get its restructuring solution through in its home jurisdiction, beleaguered German real estate group, Adler, turned to London. After substituting a UK plc as issuer of six series of notes in order to propose an English restructuring plan, and in the face of fierce opposition from an ad hoc committee of 2029 noteholders (AHG), the group successfully forced the plan through just in time.

This week’s TGIF considers a recent case where the Supreme Court of Queensland rejected a director’s application to access an executory contract of sale entered into by receivers and managers on the basis it was not a ‘financial record’

Key Takeaways

This week’s TGIF looks at the decision of the Federal Court of Australia in Donoghue v Russells (A Firm)[2021] FCA 798 in which Mr Donoghue appealed a decision to make a sequestration order which was premised on him ‘carrying on business in Australia' for the purpose of section 43(1)(b)(iii) of the Bankruptcy Act 1966 (Cth) (Act).

Key Takeaways