The High Court recently considered an application by creditors for directions calling upon a liquidator to reconsider advice he had provided in a report to the ODCE and to carry out further and more forensic investigation into the circumstances which led to the liquidation of the company.

Background

When a company is unable to pay its debts as they fall due, a director’s duties shift from the management of the company for the benefit of the shareholders, to ensuring the company’s creditors are not disadvantaged by the company continuing to trade.

The directors should seek and comply with professional advice from their auditors and solicitors regarding any decision to continue trading for an interim period.

The Supreme Court has just delivered a judgment confirming the entitlement of a judgment debtor to appoint a receiver by way of equitable execution.

The comprehensive judgment is a useful history lesson in the development and expansion of the right to appoint a receiver by way of equitable execution which derives from the old Judicator (Ireland) Act, 1877.

Background

Judgment was obtained by a bank in February 2011 against two borrowers in the amount of €1,064,747.

This week’s TGIF takes a look at the recent case of Mills Oakley (a partnership) v Asset HQ Australia Pty Ltd [2019] VSC 98, where the Supreme Court of Victoria found the statutory presumption of insolvency did not arise as there had not been effective service of a statutory demand due to a typographical error in the postal address.

What happened?

This week’s TGIF examines a decision of the Victorian Supreme Court which found that several proofs had been wrongly admitted or rejected, and had correct decisions been made, the company would not have been put into liquidation.

BACKGROUND

In a recent application for directions from the High Court, the Office of the Director of Corporate Enforcement (the “ODCE”) brought a motion to compel a liquidator contest an appeal by directors of a restriction order made against them in the High Court.

Section 683 of the Companies Act 2014 (“CA14”) requires the liquidator of an insolvent company to apply for an Order restricting the directors. It does not require liquidator to contest an appeal by directors. The ODCE ultimately withdrew the application and paid costs, but the application raises concerns for all liquidators.

This week’s TGIF considers a recent Federal Court decision which validated dispositions of property made by a company after the winding up began.

WHAT HAPPENED?

On 8 May 2017, Bond J ordered that a coal exploration company (the Company) be wound up on just and equitable grounds following a shareholder oppression claim. So as to avoid the consequences of a liquidation, his Honour immediately stayed that order for a period of 7 days to enable the warring parties a final chance to resolve their differences.

The sale of gift vouchers and their terms and conditions is largely unregulated in Ireland.

Although there is no specific legislation, gift vouchers provided to consumers are subject to the provisions of general consumer protection legislation, such as the Consumer Protection Act 2007.

Gift vouchers that cover a wide range of traders and retailers such as the “All4One” vouchers come within the definition of “electronic money” in the European Communities (Electronic Money) Regulations 2011 are subject to the provisions of those Regulations.

This week’s TGIF considers Re Broens Pty Limited (in liq) [2018] NSWSC 1747, in which a liquidator was held to be justified in making distributions to creditors in spite of several claims by employees for long service leave entitlements.

What happened?

On 19 December 2016, voluntary administrators were appointed to Broens Pty Limited (the Company). The Company supplied machinery & services to manufacturers in aerospace, rail, defence and mining industries.

Coast Stores, the occasional wear retailer and high street stallworth has gone into administration in the UK.

Coast’s sister brand Karen Millen had partially rescued the company, buying its department store concessions arm, website, safe guarding up to 600 jobs. However, as part of a pre pack administration deal, it will not be maintaining Coasts overseas stores or its UK high-street stores.