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Summary

In Carey v Korda [2012] WASCA 228, the Western Australian Supreme Court of Appeal (Court) has provided a timely confirmation that legal advisers engaged by receivers to provide advice in relation to a receivership are properly viewed as advisers to the receivers as principal, and not the mortgagor company.

The decision will no doubt be welcomed by insolvency practitioners, as it confirms that the legal advice, and the right to invoke the associated privilege, belongs to the receivers, not the mortgagor company.

The recent Federal Court of Australia (Court) decision in KASH Aboriginal Corporation ICN 108 (Administrators Appointed) No 2 [2012] FCA 789 confirms that an administrator of a company who acts honestly and reasonably may be protected from personal liability for any debts incurred while carrying out an administration.

Background

The evidence before the court established that:

The recent Supreme Court of Victoria decision in Lofthouse v Environmental Consultants International Pty Ltd & Ors [2012] VSC 416 outlines the factors the Court will take into account when considering whether to make a pooling order and considers when a liquidator may be remunerated out of the assets of pooled companies.

Background

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A Discussion and Issues Paper Inquiry into construction industry insolvency in NSW (Issues Paper) has been released and is currently available for comment as the NSW Government attempts to progress its agenda to safeguard the interests of sub-contractors in the construction industry.

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 Federal Magistrates Court recently found that an undischarged bankrupt was unable to seek compensation or a financial penalty against a former employer for unlawful dismissal, but was able to seek reinstatement instead.

Introduction

In the latest episode in one of Australia's most complex and lengthy commercial disputes, the Western Australia Court of Appeal recently dismissed an appeal by a syndicate of banks (the Banks) from a decision in favour of the liquidators of the Bell Group (the Group): Westpac Banking Corporation v The Bell Group Limited (in liquidation) [No 3] [2012] WASCA 157.