The Senate has announced a national inquiry into insolvency in the Australian construction industry (Inquiry).[1]
A recent decision by Justice Beech of the Western Australian Supreme Court in Hamersley Iron Pty Ltd v James [2015] WASC 10[1] has considered the issue of whether an adjudication determination made under the Construction Contracts Act 2004 (WA) (the Construction Contracts Act) can be enforced by an insolvent company.
SUMMARY
The FSI Report has recommended that Government should consult with relevant stakeholders to consider the introduction of 'safe harbour' provisions for directors engaged in restructuring efforts, and the suspension of ipso facto clauses during a restructuring.
Minter Ellison supports reform in both of these areas.
Australia's insolvent trading laws are among the strictest of any country. A director may become personally liable for new debts that are incurred by the company, if the director has reason to 'suspect' insolvency.
Debts claimed in statutory demands must be due and payable to the creditor named in the statutory demand.
When disputing statutory demands it is common for debtor companies to argue an offsetting claim, so as to reduce or extinguish the amount claimed in the statutory demand.
For there to be a valid offsetting claim there must be ‘mutuality’, meaning that the legal capacities in which both the offsetting claim and the statutory demand debt are each claimed and owed must align.
On 11 December 2014, Justice Croft of the Victorian Supreme Court delivered judgment approving the settlement of multiple class actions brought by investors in managed investment schemes operated by an entity of the agribusiness Great Southern Group in 2005 and 2006.
"Once in a generation" review
Shortly before the Christmas break, the much anticipated review of the United States "Chapter 11 bankruptcy" regime was published by the American Bankruptcy Institute (ABI). This is one of very few such major "root and branch" reviews of Chapter 11 since its enactment in 1978, and the first since the 1990s.
Liquidators and Trustees in Bankruptcy - Claw-Back
Sometimes service providers feel that they should not get involved to assist financially troubled clients obtain work-out or insolvency advice in fear that if their client goes into liquidation or bankruptcy that the WIP and/or fees/costs paid may be lost or "clawed back" by a liquidator because of an unfair preference claim.
The latest statistics on insolvency appointments and companies entering external administration have been released, based on data gathere
In brief: The Federal Government has released its package of reforms to Australia's personal and corporate insolvency laws. Included is a draft Bill that proposes to streamline the regulatory framework applying to insolvency practitioners with the aim of increasing efficiency in external administrations and boosting confidence in the competence of practitioners.
Australia is a member of both the Basel Committee and the G20 and in November, Brisbane was host to the G20 Leaders' Summit.
The agenda focussed on increasing global growth, jobs and economic stability. Despite the positive G20 intentions, David Cameron was quoted as saying "red warning lights are once again flashing on the dashboard of the global economy".