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Extensions of shelf life of voidable transactions claims – recent High Court decisions

On 11 March 2015, the High Court delivered the following significant decisions (Grant Samuel Corporate Finance v Fletcher [2015] HCA 8 and Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher [2015] HCA 10) in relation to s588FF(3) of theCorporations Act 2001 (Cth).

Australia, Insolvency & Restructuring, Litigation, Johnson Winter Slattery, Corporations Act 2001 (Australia)
Special purpose liquidator of One.Tel granted release under the Corporations Act

In the matter of One.Tel Limited (in liquidation) [2014] NSWSC 1892

Australia, New South Wales, Insolvency & Restructuring, Litigation, Johnson Winter Slattery, Liquidator (law), Corporations Act 2001 (Australia)
Court of Appeal upholds suspension of bankruptcy periods on basis of unsatisfactory conduct of bankrupts

Section 30A(1) of the Bankruptcy Ordinance (Cap. 6) (the “BO”), provides that the bankruptcy period, for a person who has been adjudged bankrupt for the first time, runs for four years. However, section 30A(4) of the BO provides eight grounds upon which the Court, on the application of the trustee in bankruptcy or a creditor, can order the suspension of a bankruptcy period – in effect lengthening the period of bankruptcy.

Hong Kong, Insolvency & Restructuring, Litigation, Deacons, Bankruptcy
Australian freezing orders valid ahead of foreign judgments

In the recent decision of Pt Bayan Resources TBK v BCBC Singapore Pte Ltd [2014] WASCA 178, the Western Australian Court of Appeal unanimously found that the Rules of the Supreme Court 1971 (WA) (RSC) were valid insofar as they empower the Court to ‘freeze’ local assets ahead of a possible foreign judgment.

Australia, Western Australia, Insolvency & Restructuring, Litigation, Johnson Winter Slattery
Liquidator's lien prevails over secured creditor

Introduction

Australia, Victoria, Insolvency & Restructuring, Litigation, Johnson Winter Slattery, Secured creditor, Unsecured creditor, Victoria Supreme Court
Validly constituted committees of inspection

Owen, in the Matter of RiverCity Motorway Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (“RiverCity”) [2014] FCA 1008

Australia, Insolvency & Restructuring, Litigation, Johnson Winter Slattery
The court of first instance refused to reverse a decision made by trustees in bankruptcy in assessing a bankrupt's reasonable domestic expenses

A bankrupt can be required to pay a portion of his income earned during the bankruptcy to his or her trustees by way of a contribution to the bankrupt estate. Such payments can be fixed by the court pursuant to section 43E of the Bankruptcy Ordinance (Cap 6 of the Laws of Hong Kong) or agreed between the bankrupt and the trustees on an informal basis, and are calculated after assessing the bankrupt's reasonable expenses.

Hong Kong, Insolvency & Restructuring, Litigation, Deacons, Bankruptcy
Yung Chi Keung v Protection of Wages on Insolvency Fund Board

This is a case with respect to the interpretation of the words "the applicant's entitlement to severance payment" in section 16(2)(f)(i) of the Protection of Wages on Insolvency Ordinance (the "PWIO").

Under the PWIO, the applicant may apply for an ex-gratia payment from the Protection of Wages on insolvency Fund (the "Fund") as his former employer entered into voluntary liquidation.

The relevant sections of the PWIO are set out below:-

"15(1) ......an applicant to whom:-

Hong Kong, Employment & Labor, Insolvency & Restructuring, Litigation, Deacons, Severance package