Liquidators can rest assured that courts are reluctant to interfere in their commercial judgments or permit liquidators to be personally exposed to mandatory examinations under s596ACorporations Act 2001 (Cth) (Act).

Last week the Supreme Court of New South Wales provided another timely reminder to ensure that all security interests are correctly registered on the Personal Property and Securities Register (PPSR) through the decision In the matter of OneSteel Manufacturing Pty Ltd (administrators appointed) [2017] NSWSC 21.

The facts

Alleasing Pty Ltd leased a crushing and screening plant (for approximately $4 million annually in rent) and spare parts for the crusher to OneSteel Manufacturing Pty Limited.

Whether an insured had misrepresented and/or failed to disclose to an insurer that its professional services encompassed directors and officers services.

In Issue

• Non-Disclosure and misrepresentations by insureds
• Consideration of sections 21 and 26 of the Insurance Contracts Act 1984 (Cth)

The Background

On 31 January 2017, Brereton J of the Supreme Court of New South Wales in In the matter of OneSteel Manufacturing Pty Limited (administrators appointed) [2017] NSWSC 21 declared that the interests of Alleasing Pty Limited as lessor of a certain crusher and spare parts had vested in OneSteel Manufacturing Pty Limited, effectively giving ownership of the leased assets to the insolvent estate to be realised for the benefit of creditors generally after the company mistakenly registered the financing statements against Onesteel’s ABN rather than its ACN.

With the Australian Taxation Office very active in winding up companies for unpaid taxes, it is now commonplace for insolvency professionals to be faced with pending winding up petitions when considering an appointment as voluntary administrator. Obtaining an adjournment of the petition is often the first critical task in an administration.

Before the Swan Group was placed into liquidation on 27 June 2013, it was the fifth largest cleaning contract business in Australia. It held significant contracts with major corporate groups, shopping centres, universities, airports and other public facilities.

This week’s TGIF considers Tai-Soo Suk v Hanjin Shopping Co Ltd [2016] FCA 1404 in which the Court was required to determine the scope of a stay arising under the UNCITRAL Model Law on Cross Border Insolvency.

BACKGROUND

A Korean shipping company was subject to ‘rehabilitation’ proceedings in Korea. Rehabilitation proceedings seek to ‘rehabilitate’ insolvent debtors by restructuring their debt pursuant to a rehabilitation plan approved by the creditors and the Rehabilitation Court.

In Navarac v Pty Ltd v Carrello [2016] WASC 327, the court-appointed receiver and manager of Esperance Cattle Company Pty Ltd had applied for orders from the court to conclude the receivership.

In order to prepare evidence and submissions to oppose the receiver's application, a director of the company applied to inspect certain documents, which she asserted were or might be held by the receiver.

In State of Victoria v Goulburn Administration Services (In Liquidation) & Ors [2016] VSC 654, the Victoria Supreme Court appointed two partners of Ernst & Young (EY) as special purpose liquidators (SPLs) of two companies, despite EY's involvement in carrying out contractual compliance audits before those companies went into liquidation.

In Re PrimeSpace Property Investment Limited (In Liquidation) [2016] NSWSC 1450 the Supreme Court of New South Wales was asked to consider whether it could make directions in respect of the investigation of the affairs of a corporate trustee (whose only assets were held on trust). The company, as trustee, had guaranteed a loan from a third party and also granted that third party first option on several apartments.