In this week’s TGIF, we examine the recent case of Re Eliana Construction and Developing Group Pty Ltd [2023] VSC 639 which considers guarantor subrogation rights in insolvency scenarios.
Key takeaways
A free-standing moratorium for financially distressed but ultimately viable companies was introduced in 2020. It is sometimes called a Part A1 moratorium, after the part of the Insolvency Act 1986 which provides for it.
In the matter of Premier Energy Resources Pty Ltd [2023] NSWSC 1185, the Administrator unsuccessfully sought an order validating his appointment where he failed to investigate allegations that his appointment documents included a director’s forged letter of resignation.
Key takeaways
Overview
- The UK Supreme Court issued a recent decision in R (on the application of Palmer) v Northern Derbyshire Magistrates Court and Another [2023] UKSC 38.
- Crucially, the Court determined that an administrator is not an officer of the company within the meaning of the phrase 'any director, manager, secretary or similar officer of the body corporate', for the purpose of section 194(3).
Contents
R (on the application of Palmer) v Northern Derbyshire Magistrates Court and Another [2023] UKSC 38
R (ON THE APPLICATION OF PALMER) V NORTHERN DERBYSHIRE MAGISTRATES COURT AND ANOTHER [2023] UKSC 38
Insolvency practitioners will welcome the Supreme Court’s recent decision that an administrator of a company appointed under the Insolvency Act 1986 (IA) does not fall within the ambit of section 194(3) of the Trade Union and Labour Relations (Consolidation) Act 1992) (TULRCA) and therefore cannot be held personally liable under criminal law for the company’s failure to give notice to the Secretary of State in accordance with section 193 of TULRCA.
With the passing of the Moveable Transactions (Scotland) Act (MTSA) (likely to pass into law in 2024) the way in which we take security over rights and assets in Scotland will be brought firmly into the 21st century, doing away with the need to rely on statutes from as long ago as 1862 and a smattering of case law which has fostered uncertainty in the market for almost as long.
This week’s TGIF summarises the Federal Court of Australia’s recent decision granting leave to proceed against a company despite the appointment of a small business restructuring (SBR) practitioner under Pt 5.3B of the Corporations Act 2001 (Cth) (Corporations Act).
Key takeaways
Last week marked another instalment in the notorious insolvency of Comet Group plc (Comet) when the Court of Appeal unanimously set aside the decision of the High Court at first instance which, at the time, was claimed to be the largest successful preference claim in value, resulting in Darty Holdings SAS (successor to Kesa International Ltd (KIL)) being ordered to pay approximately GBP90 million to the liquidators of Comet.
Analysis and Commentary on the Insolvency Statistics Q2 2023
The quarterly insolvency statistics for April to June 2023 show that corporate insolvencies across the UK1 are at a 14-year high.
Increased insolvencies appear to be continuing with the monthly statistics for both August and September 2023, showing corporate insolvency numbers were higher than the same month last year. July’s figures showed a slight decrease year on year.
In the matter of Bleecker Property Group Pty Ltd (In Liquidation) [2023] NSWSC 1071, appears to be the first published case that considers the question of whether an order can be made under section 588FF(1)(a) of the Corporations Act 2001 (Cth) by way of default judgment against one defendant where there are multiple defendants in the proceedings.
Key takeaways