This week’s TGIF is the first of a two-part series considering Commonwealth v Byrnes [2018] VSCA 41, the Victorian Court of Appeal’s decision on appeal from last year’s Re Amerind decision about the insolvency of corporate trustees.
This first part looks closely at what the Court of Appeal did – and did not – decide in relation to how receivers and liquidators should deal with property recovered pursuant to an insolvent corporate trustee’s right of indemnity.
In September 2017, the Commonwealth Parliament passed the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Act 2017 (Cth) to amend and reform the insolvency and external administration provisions of the Corporations Act 2001 (Cth).
One of the main changes implemented by these reforms was the introduction of a ‘safe harbour’ protection for company directors.
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.
This week’s TGIF is the second of a two-part series considering Commonwealth v Byrnes [2018] VSCA 41, the Victorian Court of Appeal’s decision on appeal from last year’s Re Amerind decision about the insolvency of corporate trustees.
The Senate Legal and Constitutional Affairs Legislation Committee (“the Committee”) has endorsed the passing of the Bankruptcy Amendment (Enterprise Incentives) Bill 2017 (“the Bill”) in its report dated 21 March 2018.[1]
In the recent decision of Jones (liquidator) v Matrix Partners Pty Ltd, re Killarnee Civil & Concrete Contractors Pty Ltd (in liq) [2018] FCAFC 40 (Killarnee), the three member bench comprised Allsop CJ, and Siopis and Farrell JJ. Their Honours of the Full Court wrote three separate judgments, with the Chief Justice writing the lead.
Liquidators will generally be pretty happy if a court finds that a transaction was both an uncommercial transaction and an unfair preference and dismisses any defence. Unfortunately for the liquidator in Re Cyberduck Software Pty Ltd (In Liq) & Anor [2018] VSC 122 you can still fail.
In Cyberduck:
In handing over any documents in litigation or Court process, you must assess whether or not the documents have tax relevance.
JWS has achieved an excellent result for the liquidators of the Gunns Group, with success in the Federal Court’s judgment in Bryant (Liquidator) v L.V. Dohnt & Co Pty Ltd, In the Matter of Gunns Limited (In Liq.) (Receivers and Managers Appointed) [2018] FCA 238.
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?