In its June 6, 2022 opinion in Siegel v. Fitzgerald, the United States Supreme Court resolved a circuit split and invalidated a 2017 statute that increased U.S. Trustee fees in 48 states—but not Alabama or North Carolina—as unconstitutional under the uniformity requirement of the Constitution’s Bankruptcy Clause. See Siegel v. Fitzgerald, 596 U.S. ___ (2022).
U.S. Trustee Fees, a History
The active trading of loans made to a borrower that has become unable to repay in full (known as non-performing loans or distressed debt) has been a feature of the North American and European loan markets for a number of years.
The Insolvency Service has published a report on the research commissioned by it on the use of Company Voluntary Arrangements ("CVAs") by large companies in the retail trade, accommodation and food and beverage sectors.
This matter involved the former director and former accountant of CGS Constructions (QLD) Pty Ltd filing proceedings seeking an injunction to restrain the Liquidators from engaging Cornwalls Lawyers to act on the basis that:
- Cornwalls also acted for a substantial creditor, Union Share Pty Ltd; and
- the Liquidators, by engaging Cornwalls, had manifested a tendency to favour certain interests at the expense of others.
Background
In the matter of Squirrel Limited (In Liquidation), the Court considered an application for summary judgement against a director for insolvent trading. In doing so, the Court considered the principles underpinning a director’s duty to prevent insolvent trading and the compensation payable as a result.
Background
In Re Intellicomms Pty Ltd (in liq) [2022] VSC 228, it was determined that a sale agreement was a creditor-defeating disposition within the meaning of section 588FDB of the Corporations Act 2001 (Cth) (Act) and voidable pursuant to section 588FE(6B) of the Act.
Background
The Supreme Court of Victoria has considered the viability of allowing a company to enter a second voluntary administration after going into liquidation following a failed DOCA. The Court considered that rather than maintain a state of liquidation, the secondary voluntary administration process would better serve the best interests of creditors and optimise the efficiency of the restructuring process. The decision serves as a useful guide to the considerations and orders appropriate for successfully arguing a company out of liquidation.
Background
Family law processes cannot be used to defraud creditors. In Re ZH International Pty Ltd (in liq), the Supreme Court of New South Wales held that transfers of property from a company to the directors and shareholders of that company as part of family law proceedings were voidable transactions under section 588FF of the Corporations Act 2001 (Cth) where the company was not a party to the orders and the orders did not require the company to make the transfers.
Background
Public examination can be a useful tool for parties in a liquidation to obtain information about matters relating to a company’s affairs. In the matter of Jewel of India Holdings Pty Ltd ACN 141 963 813 (in liquidation) [2022] NSWSC 356, the Court considered whether summonses for public examination, that were issued by the former owner of the business to the liquidators and former administrators of Jewel Holdings, constituted an abuse of process.