The Issue

Fiduciaries who breach their duties may pay the consequences far longer than they may think, for they may not even be able to escape liability through personal bankruptcy.  In Raso v. Fahey (In re Fahey), No. 11-1118 (June 11, 2013), the U.S Bankruptcy Court for the District of Massachusetts became the first court to apply the new defalcation guidelines laid down by the Supreme Court in Bullock v. BankChampaign, NA, 133 S. Ct.

The Federal Court found that where a trust deed provides for the cessation of a corporate trustee upon the appointment of an administrator or upon a resolution for its liquidation (and there is no replacement trustee appointed), the corporate trustee retains its right of indemnity and continues as bare trustee but does not have the power to sell the trust assets.  However, the Court was persuaded to grant relief to the liquidators of the trustee (who had sold trust assets) on the basis they had not been advised by their solicitors of the disqualification clause and they com

It is no surprise to anyone in the business of secured lending that valuation matters.  It is worth noting, however, that collateral valuation may be outcome-determinative in litigation over a plan of reorganization in bankruptcy.  Although valuation was not the central focus of the Fifth Circuit’s recent decision in Western Real Estate Equities, L.L.C. v. Village at Camp Bowie I, L.P. (Matter of Village at Camp Bowie I, L.P.), No. 12-10271, 2013 U.S. App. LEXIS 3949 (5th Cir. Feb.

Recently, an NLRB administrative law judge ruled that two policies maintained by subsidiaries of the University of Pittsburgh Medical Center (“UPMC”) violated Section 8(a)(1) of the National Labor Relations Act.  See UPMC, Case No. 6-CA-81896, 4/19/13. Specifically, ALJ David Goldman found that the hospitals’ electronic mail and messaging and acceptable use of information technology resources policies impermissibly interfered with employees’ Section 7 right to engage in protected concerted activity.

Introduction

On 29 January 2013, the Federal Court of Australia made orders approving the creditors’ scheme of arrangement between Nine Entertainment Group Pty Limited (NEG) and its senior and mezzanine lenders (Nine Scheme).

The Nine Scheme, made under Part 5.1 of the Corporations Act, follows Alinta and Centro as the third debt for equity restructuring of a major Australian company in as many years.

This is the second case in which the New South Wales Supreme Court has granted an extension of time for registration of a security interest on the Personal Property Securities Register where the delay is accidental or due to inadvertence.  However, the extension in this case was conditional firstly, by preserving the priority of another security interest which had been registered in the meantime and secondly, because there was insufficient evidence of the financial position of the grantor to establish that an extension was unlikely to prejudice other creditors or shareholde

Under Section 436 of the Internal Revenue Code, a single employer defined benefit plan sponsored by a company in bankruptcy cannot pay any “prohibited payments” (e.g., lump sums, Social Security level income annuity payments) if the plan is less than 100% funded. In June 2012, the IRS issued proposed regulations permitting such a defined benefit plan to be amended to eliminate prohibited payment forms without violating the anti-cutback requirements of Internal Revenue Code Section 411(d)(6) if certain conditions are satisfied.

On July 25, 2012, the Third Circuit issued its decision in In re American Capital Equipment LLC and Skinner Engine Co., 688 F.3d 145 (3rd Cir. 2012), becoming the first circuit court to align itself with numerous district courts that have allowed bankruptcy courts to reject a Chapter 11 plan prior to a confirmation hearing.

ASIC has made a brand new start to the way insolvency notices will be published in Australia. From 1 July 2012 the previous obligations for publications have melted away.