In the recent case MSI (Holdings) Pty Ltd v Mainstreet International Group Ltd, the Queensland Supreme Court confirmed that receivers of a company in liquidation can commence legal proceedings in the name of the company without leave of the court, when those proceedings relate to the recovery of secured property.

Our September 2012 insolvency update featured the article "Disclaiming Landlord's Interest in a Lease - an Australian Perspective". This article discussed the Victorian Court of Appeal's ruling that section 568(1) of the Corporations Act 2001 (Cth) (similar to our own section 269 of the Companies Act 1993 (NZ)) allows a liquidator to exercise his power of disclaimer to extinguish the leasehold estate of a tenant.

A creditor of a company subject to a Deed of Company Arrangement (DOCA) was recently successful in seeking termination of the DOCA by the court. As a result of the company's non-compliance with the DOCA, the majority of creditors resolved to extend the term of the DOCA and increase the amount to be paid by the company. The applicant creditor alleged that the DOCA should be terminated because the company had failed to make payment in accordance with it, and the variation had not taken effect.

The Court made an order terminating the DOCA on the grounds that:

In the recent UK case of Williams v Glover & Anor, the Court considered the novel issue of whether the right to appeal against a tax liability constitutes the "property" of a company in liquidation, in deciding whether such a right was assignable or not. In that case, the applicant liquidator sought directions as to whether it could assign the right to appeal against an assessment of tax liability to the respondent former directors of the company in liquidation. Judge Pelling QC held that while there were authorities that had considered this point, they were not binding.

In Carillion Construction Ltd v Hussain, the English High Court held that the withdrawal of letters of support given by a parent company to the directors of its subsidiary was not a transaction defrauding creditors under the Insolvency Act 1986 (UK).

In what seems to be an unrelenting trend, new figures released this month by the British Solicitors' Regulation Authority (SRA), have disclosed that 30 of the top-200 UK law firms are in serious financial difficulty and have entered into "intensive engagement" with the SRA. While no names were named, it was revealed that these firms were among a wider group of 400 UK firms that were under active management by the regulator.

The UK Supreme Court recently considered the scope of the following tests for whether a company is unable to pay its debts (as set out in section 123(2) of the Insolvency Act 1986):

• The company is unable to pay its debts as they fall due (the "cash-flow test") and
• The value of a company's assets is less than the amount of its liabilities, taking into account its contingent and prospective liabilities (the "balance-sheet test").

The Supreme Court confirmed that:

In Rabson v Croad [2013] NZSC 3, the Court of Appeal dismissed Mr Rabson's appeal of a High Court order pursuant to section 301 of the Companies Act 1993 (Act) that he reimburse $58,084.31 to a company in liquidation of which he had been a director.  Mr Rabson sought leave to appeal to the Supreme Court to challenge the Court of Appeal's substantive determination on the basis that (among other things) the High Court failed to comply with section 301 of the Act which confers on the Court the power, in the course of a liquidation, to inquire into the conduct of certain persons a

Justice Dobson has recently reversed his interim ruling that section 17A Judicature Act 1908 gives the Court jurisdiction to appoint a liquidator to a trust if satisfied there are reasons for doing so. He found that a trust is not an "association" to which section 17A applies, and instead appointed receivers with selected powers given to liquidators under the Companies Act 1993.

In Grant v Independent Livestock 2010 Limited [2012] NZHC 3458, the liquidators of ILA sought to hold the sole director of ILA and IL2010 (a company to which ILA's assets had been transferred) liable for debts incurred by ILA.