INTRODUCTION:

The Supreme Court in a recent judgment of Indus Biotech Pvt. Ltd. vs. Kotak India Venture (Offshore) Fund [AIR 2021 SC 1638] has settled an important question of law: ‘whetheran application filed under Section 8 of Arbitration & Conciliation Act, 1996 (‘A&C Act’) can be said to be maintainable in a proceeding initiated under Insolvency and Bankruptcy Code, 2016 (‘IBC’)’.

The High Court has released its judgment in Re Halifax NZ Limited (In liq) [2021] NZHC 113, involving a unique contemporaneous sitting of the High Court of New Zealand and Federal Court of Australia.

INTRODUCTION:

This update deals with the significant appeal judgment released yesterday by the Court of Appeal in the proceedings brought by the liquidators of Mainzeal Property and Construction Ltd (in Liq) (Mainzeal) against its directors. Our previous legal updates on the High Court decisions can be found here and here.

The real lesson from Debut Homes – don't stiff the tax (wo)man

The Supreme Court has overturned the 2019 Court of Appeal decision Cooper v Debut Homes Limited (in liquidation) [2019] NZCA 39 and restored the orders made by the earlier High Court decision, reminding directors that the broad duties under the Companies Act require consideration of the interests of all creditors, and not just a select group. This is the first time New Zealand’s highest court has considered sections 131, 135 and 136 of the Companies Act, making this a significant decision.

The Government of India announced that Sections 7, 9 and 10 of the Insolvency & Bankruptcy Code, 2016 shall continue to remain suspended for another three months i.e. till March 31, 2021 on account of the COVID -19 pandemic. Sections 7, 9 and 10 deal with the initiation of corporate insolvency proceedings by financial and operational creditors against corporate debtors.

Five years after it refused to pay rent and took the landlord to the High Court, and two years after it was placed into liquidation on account of unpaid rent, the final branch of litigation brought by the directors of Oceanic Palms Limited (in liq) has been cut down by the Supreme Court.

The UK Supreme Court in Bresco Electrical Services Ltd (in liq) v Michael J Lonsdale (Electrical Ltd) [2020] UKSC 25 has decided that the adjudication regime for building disputes is not incompatible with the insolvency process.

In the two judgments, Commissioner of Inland Revenue v Salus Safety Equipment Ltd (in liq) [2020] NZHC 1368 and Commissioner Inland Revenue v Green Securities Ltd (in liq) [2020] NZHC 1371, Associate Judge Bell significantly reduced the amount recoverable in each proceeding by liquidators. 

Both cases considered applications from liquidators to seek approval of their remuneration.  In Salus the amount claimed was $91,600 and in Green Securities it was $159,044.

Former liquidator Geoffrey Smith has been convicted on six charges, including stealing $130,000 from two companies to which he had been appointed liquidator. Mr Smith was also convicted of perjury in connection with the same liquidations.