In a recent case, the Victorian Supreme Court said that an accountant ‘would know well that a statutory demand involves strict time frames for response and potentially very significant consequences for a company’. The accountant failed to take appropriate steps to inform the company of the statutory demand.
The statutory demand process
If a company does not comply with a statutory demand within 21 days of service, it is deemed to be insolvent and the creditor may proceed to wind up the company.
A recent court decision considers the legal principles and sufficiency of evidence when a court-appointed receiver seeks approval of their remuneration.
A court-appointed receiver needs court approval for the payment of their remuneration. The receiver has the onus of establishing the reasonableness of the work performed and of the remuneration sought.
On November 11, 2022, the world’s second-largest cryptocurrency exchange FTX Trading Ltd. filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-11068). The company reports $10 to $50 billion in both assets and liabilities and intends to place an additional, approximately 130 affiliates into bankruptcy.
On November 7, 2022, cloud manufacturing and digital supply chain company Fast Radius, Inc. of Chicago, IL filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-11051). The company reports $69.3 million in assets and $55.2 million in liabilities.
On October 30, 2022, wealth advisory, risk management services and insurance brokerage services provider Vesta Holdings LLC of Mongomeryville, PA filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-11019) along with two affiliates. The company reports $100 million to $500 million in both assets and liabilities.
On September 27, 2022, Phoenix Services Topco LLC, a steel mill service provider with approximately 2,600 employees, filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-10906). The company reports $500 million to $1 billion in both assets and liabilities.
On August 28, 2022, Hauppauge, N.Y.-based Packable Holdings, LLC, a privately-owned tech-enabled e-commerce company, filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-10797). The company reports $100 million to $500 million in both assets and liabilities.
On August 23, 2022, College Park, Georgia-based ExpressJet Airlines LLC, a leading regional airline connecting millions of passengers to North America monthly, filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-10787). The company reports $10 million to $50 million in both assets and liabilities.
On August 23, 2022 (the “Petition Date”), Rochester, New York-based Carestream Health, Inc.
On August 6, 2022, OSG Group Holdings, Inc., which provides transactional, marketing, and payment solutions to various industries, filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 22-10718). The company also filed a prepackaged plan of reorganization.