The High Court has recently clarified what is required for the creation of an express trust (Korda & Ors v Australian Executor Trustees (SA) Ltd [2015] HCA 6 (Korda)).
To be effective, express trusts must satisfy the three certainties of intention, subject matter and object. That is:
CLARITY OF INTENTION KEY TO CREATION OF EXPRESS TRUSTS: A WIN FOR RECEIVERS
The High Court has recently clarified what is required for the creation of an express trust (Korda & Ors v Australian Executor Trustees (SA) Ltd [2015] HCA 6 (Korda)).
To be effective, express trusts must satisfy the three certainties of intention, subject matter and object. That is:
It is a well understood legal requirement that any time security is granted, it needs to be registered. Failure to register collateral granted as security according to the requirements of the Personal Property Securities Act 2009 (Cth) can result in the property vesting in the company in administration or liquidation. However in certain circumstances the court may make an order extending the time for registration, even after an insolvency event in respect of the grantor.
BACKGROUND
In Condon (Trustee), in the matter of Rayhill (Bankrupt) v Truthful Endeavour Pty Ltd [2015] FCA 7, Condon, as trustee of the bankrupt estate of Colleen Ann Rayhill (known as Colleen Lewis), sought a declaration that various payments made in respect of a property (the Property) rendered Lewis a creditor of the Kenthurst Investment Trust (KI Trust).
A debtor company can seek to have a statutory demand set aside if there is a genuine dispute as to the existence or amount of the debt, or the company has an offsetting claim.
Because the threshold for contesting a statutory demand is relatively low, a creditor may decide it is better to issue the statutory demand for the undisputed portion of the total debt after making an appropriate allowance for the amount of the total debt in dispute or the amount of the alleged offsetting claim.
In brief: The High Court has held that the proceeds of a forestry investment scheme were not held on trust for the investors by the operators of the scheme. The decision emphasises that a trust will not arise unless the parties expressly declare their intention to create a trust, or if such an intention can be clearly inferred from the language of the parties and the commercial circumstances.
In brief: The Federal Court has dismissed shareholders' claims against Babcock & Brown alleging failure to disclose market sensitive information. The court made important findings on the scope of listed entities' continuous disclosure obligations in the context of accounting irregularities, and potential insolvency. The court has also given theoretical support to market-based causation, although this was not necessary to decide the case. Partner Duncan Travis (view CV) and Lawyer Michela Agnoletti report on the decision, and its implications.
By an ordinance (Mandatsbescheid) issued on March 1, 2015, the Austrian Financial Market Authority (“FMA”) has initiated the resolution of HETA ASSET RESOLUTION AG (“HETA”). HETA is the “bad bank” that was established to assume and manage large parts of the Austrian Bank Hypo-Alpe-Adria, which was required to be resolved in accordance with EU regulations. HETA is 100 percent owned by the Republic of Austria, and it currently manages assets worth approximately EUR 18 billion.
ABILITY TO SEEK AN EXTENSION OF TIME
Section 588FF(3) of the Corporations Act 2001 (the Act) provides liquidators with a mechanism by which to obtain an extension of time within which proceedings against the recipients of voidable transactions may be commenced.
In brief: In two decisions arising from the Octaviar liquidation, the High Court has given guidance on liquidators' ability to seek extensions of time for bringing voidable transaction claims. The decisions also highlight the risks of such applications. Partner Christopher Prestwich (view CV) and Lawyer Julia Baine report.
HOW DOES THIS AFFECT YOU?