The Federal Government has proposed a major strengthening of APRA’s crisis management powers and has released a consultation paper containing wide-ranging proposals for financial services reform that are now open to industry comment.

The recent decision of the Victorian Court of Appeal in Re Willmott Forests Limited (Receivers and Managers appointed) (in liquidation) [2012] VSCA 202 gives liquidators comfort when disclaiming leases (as the liquidator of a landlord) pursuant to s 568(1) of the Corporations Act 2001 (Cth) (‘the Act’).

After 448 days in court, over 85,000 documents and more than 10 judgments, a special bench of the Western Australian Court of Appeal handed down its decision in Westpac Banking Corporation v The Bell Group Ltd (in liq) (No.3) [2012] WASCA 157 (Bell Appeal Decision). The Bell Appeal Decision raises issues relating to the integrity of transactions with companies facing insolvency, which may create serious liability issues for company directors and lenders alike.  

Two significant changes were made to the Virginia recording tax statutes applicable to deeds of trusts during the 2012 session of the General Assembly. First, the exemption from recording taxes for deeds of trust whose purpose is to refinance an existing debt with the same lender was eliminated. Second, on deeds of trust securing debt in excess of the fair market value of the real estate, the recording tax now may be paid on the value of the property conveyed rather than the amount of the debt.

In light of the modern trend towards “pre-pack” arrangements as a legitimate restructuring solution, a recent judgment handed down in the Federal Court provides a timely reminder for insolvency practitioners that independence is paramount and liquidators can be removed upon the application of a creditor in circumstances where there is a perception of conflict.

Seventh Circuit reverses district court decision that discretionary beneficiary lacked standing to bring surcharge claim for $200 million in investment losses from investment concentration.

Forum selection clause in an investment management agreement is valid and enforceable.

Senator Charles Grassley has sent a letter to the Justice Department asking how Justice has enforced “key employee retention plans” (KERPs) under 503(c) of the U.S.

In recent years, several foreign companies have used the English law scheme of arrangement as a flexible restructuring method to compromise creditor claims.  The decision of the High Court in the latest of these cases, that of the German company Rodenstock GmbH, clarifies that an English court will accept jurisdiction where the only connection to England is that the company’s finance documents were governed by English law.

One of the many issues which arose from the collapse of Lehman Brothers was whether “flip provisions”, which reverse a swap counterparty’s priority in the order of payment on insolvency, were invalid on the basis that they contravened the anti-deprivation principle.  This is a long-established common law principle which seeks to prevent an insolvent party from arranging its affairs to frustrate the legitimate claims of creditors.