Australia has now entered its first recession in 29 years, and the Australian Government has implemented a number of legislative reforms and other initiatives to support and provide temporary relief to businesses, including stimulus payments, enhanced asset write-off and flexibility in the application of the Corporations Act 2001 (Cth).

Creditors' rights to information and records

Particularly in smaller external administrations, the court will not blindly accept time-based remuneration as reflecting the value of the work, but will consider the proportionality of the remuneration.

In a number of recent judgments, the courts appear to be favouring considerations of proportionality coupled with an assessment of the realisations achieved when assessing application for the approval of remuneration for external administrators.

Key Points:

Provided a liquidator is acting properly in conducting proceedings or realising assets, he or she is entitled to be paid fees in priority to a secured creditor.

The High Court has recently reaffirmed the principle that a liquidator is entitled to be paid his or her costs and expenses properly incurred in realising assets of a company in priority to a secured creditor. This is so even if the fund realised was derived from an action brought against a secured creditor (Stewart v Atco Controls Pty Ltd (in Liquidation) [2014] HCA 15).