Two recent Supreme Court of Canada decisions demonstrate that the corporate attribution doctrine is not a one-size-fits-all approach.
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 Re Brew Still Pty Ltd (admin apptd)[2023] NSWSC 256, Black J of the New South Wales Supreme Court declined an application for an adjournment of one month brought by the voluntary administrator appointed to Brew Still Pty Ltd three days prior to the hearing of the winding up application.
The decisions in Metal Manufactures Pty Limited v Morton [2023] HCA 1 and Bryant v Badenoch Integrated Logging Pty Ltd [2023] HCA 2 have been viewed as conflicting for liquidators. In this week’s TGIF, we examine these proceedings and why the decisions benefit both liquidators and creditors.
Key takeaways
In Lawrence, Ozifin Tech Pty Ltd (in liq) v AGM Markets Pty Ltd (in liq)[2022] FCA 1478, liquidators of multiple companies were successful in obtaining the declarations and directions they sought regarding the distribution of statutory trust funds, and obtaining payment of their fees from trust assets.
In the recent decision of Banerjee (Liquidator), in the matter of Eastside Formwork Pty Ltd (in liq) v Stojic [2022] FCA 1315, a liquidator succeeded in obtaining orders for a warrant to search for and seize books and records which had been concealed from the liquidator. The warrant was directed at the person deemed the ‘guiding mind and will’ of the company in liquidation, who had repeatedly ‘fobbed off’ requests for the production of all records of the company.
Key takeaways
In a recent decision handed down in Gold Valley Iron Pty Ltd (in liq) v OPS Screening & Crushing Equipment Pty Ltd [2022] WASCA 134, Liquidators succeeded in establishing an ‘equipment lease with an option to purchase’ clause as being a security interest under the Personal Property Securities Act 2009 which needed to be registered by the owner.
Key takeaways
On October 17, 2022, Justice Andrea Masley of the NY Supreme Court issued a decision and order denying all but one of the motion to dismiss claims filed by Boardriders, Oaktree Capital (an equity holder, term lender, and “Sponsor” under the credit agreement), and an ad hoc group of lenders (the “Participating Lenders”) that participated in an “uptiering” transaction that included new money investments and roll-ups of existing term loan debt into new priming debt that would sit at the top of the company’s capital structure.
On October 14, 2022, the Fifth Circuit issued its decision in Ultra Petroleum, granting favorable outcomes to “unimpaired” creditors that challenged the company’s plan of reorganization and argued for payment (i) of a ~$200 million make-whole and (ii) post-petition interest at the contractual rate, not the Federal Judgment Rate. At issue on appeal was the Chapter 11 plan proposed by the “massively solvent” debtors—Ultra Petroleum Corp. (HoldCo) and its affiliates, including subsidiary Ultra Resources, Inc.
On July 6, Delaware Bankruptcy Court Judge Craig T. Goldblatt issued a memorandum opinion in the bankruptcy cases of TPC Group, Inc., growing the corpus of recent court decisions tackling “uptiering” and other similar transactions that have been dubbed by some practitioners and investors as “creditor-on-creditor violence.” This topic has been a hot button issue for a few years, playing out in a number of high profile scenarios, from J.Crew and Travelport to Serta Simmons and TriMark, among others.