The Court will closely examine the relevant transactions involving the accounts and form a view – which may be an impressionistic one – as to the likely extent of the interest of each client (or each client group) in those accounts.

The updates to the Guidance Note provide useful guidance on disclosure requirements in the context of the safe harbour reforms but ultimately, the status quo continues.

The ASX has updated its continuous disclosure guidance for entities in financial distress to address uncertainty following the recent introduction of the insolvent trading safe harbour provisions into the Corporations Act. While the ASX has provided useful guidance, unsurprisingly, the position has not changed and directors must continually assess compliance with continuous disclosure requirements.

Following a landmark decision in the Full Federal Court, employees will retain their priority to payment of their entitlements in a company liquidation, even where the company is a corporate trustee of a trust.

The liquidators were not bound to cause Linc to comply with the EPO from the date of the disclaimer.

The Victorian Court of Appeal decides that the Corporations Act priority regime does apply to trading trusts.

The law is now clear. Or is it?

For the last two years and six days, insolvency practitioners and other stakeholders involved in the liquidation of trading trusts have been frustrated by what should be a very straightforward question.

If the company in liquidation carries on business through a trust structure, as many do, what is the order of priorities that the liquidator must apply when making distributions to creditors?

As deleveraging to control transactions continue to be part of the legal landscape in Australia, we anticipate seeing further examples, particularly where the distressed company is a listed entity. 

With the enactment of the ipso factoreform in September this year (which commences operation on 1 July 2018), it is the genuine hope of many insolvency practitioners and others in the market that voluntary administration will become a less value-destructive and, therefore, a more useful tool for company restructures.

The Boart Longyear decisions confirm that class constitution remains a critical issue for review when pursuing creditors' schemes of arrangement.

The New South Wales Court of Appeal has recently confirmed the circumstances in which companies seeking approval of schemes of arrangement will be required to convene separate meetings for different classes of creditors.

Class constitution: key principles

The reforms proposed to combat illegal phoenix activity range from light-touch through to more significant changes to the Corporations Act.

New offences in the Corporations Act, a cab rank system for liquidators, and changes to tax laws have been put forward by the Australian Government in its consultation package of anti-phoenixing reforms released yesterday. Consultation closes on 27 October 2017.