Liquidator remuneration in insolvency proceedings often raises difficult questions; especially in large corporate collapses where the work is extensive and the stakes are high. Courts must balance fair compensation with creditor protection, but approaches to fee assessment have varied across jurisdictions, leading to uncertainty and dispute.
When a company goes into liquidation, creditors often wonder whether they will recover their debts. One available option to achieve this is funding legal action to help the liquidator recover assets.
Singapore's insolvency legislation allows creditors who fund liquidators' recovery actions to have priority over other creditors in the distribution of recovered assets. This improves the viability of commencing insolvency proceedings as an asset recovery tool.
When a company enters liquidation, the appointed liquidator steps into a pivotal role – one that requires navigating complex challenges to recover assets and maximize returns for creditors. This task entails conducting detailed investigations and pursuing legal actions, processes that demand a careful balance of inquiry, judgment, and responsibility.
The Employment (Collective Redundancies and Miscellaneous Provisions) and Companies (Amendment) Act 2023 (Collective Redundancies AmendmentAct) came into operation on 1 July 2024.
The Employment (Collective Redundancies and Miscellaneous Provisions) and Companies (Amendment) Act 2023 (Act) came into effect on 1 July 2024.
We have blogged previously about the intersection of fraud and bankruptcy.
In Harrington v. Purdue Pharma L.P., 144 S. Ct. 2071 (2024) (“Purdue”), the Supreme Court held that the Bankruptcy Code does not authorize nonconsensual releases of nondebtors as part of a chapter 11 plan. The Court narrowly read the Code’s language, providing that a plan may “include any other appropriate provision not inconsistent with the applicable provisions of this title,” 11 U.S.C.
Redefine Australian Investments Limited (Company), an Irish-registered company was placed in voluntary liquidation on 24 January 2018. Martin Ferris was appointed as the liquidator (Liquidator).
The Proceedings
The Employment (Collective Redundancies and Miscellaneous Provisions) and Companies (Amendment) Act 2024 (Act) has been signed into law but awaits a commencement order to bring it into operation.
In summary, the Act amends the Companies Act 2014 (Companies Act) by modifying the attribution test for related companies to contribute to the debts of the company being wound up, broadening the operative time for unfair preferences, and varying the test for reckless trading.
1. Related company contribution
This article originally appeared in The Bankruptcy Strategist.
To file bankruptcy in the U.S., a debtor must reside in, have a domicile or a place of business in, or have property in the United States. 11 U.S.C. §109(a). In cross border Chapter 15 cases, courts have considered if a foreign debtor must satisfy that jurisdictional test.