In the recent case MSI (Holdings) Pty Ltd v Mainstreet International Group Ltd, the Queensland Supreme Court confirmed that receivers of a company in liquidation can commence legal proceedings in the name of the company without leave of the court, when those proceedings relate to the recovery of secured property.

MSI (Holdings) Pty Ltd (Receivers Appointed) (in Liquidation) ACN 120 419 409 (MSI) against Mainstreet International Group Limited (Mainstreet) ACN 120 747 124.

The appeal was brought by the Receivers, who sought to recover a debt for the secured creditor once a liquidator had been appointed to MSI.

The Court of Appeal handed down the decision recently in favour of MSI.

Facts of the case

The liquidators of Lehman Brothers Australia are appealing a landmark Federal Court decision that found it liable for losses suffered by a number of local councils and charity groups.

It is well established that if a trustee company goes into liquidation then:

The decision of Fielding as Liquidator of Lyngray Developments Pty Ltd (In Liquidation) v Dushas & Anor [2013] QCA55, overturned a Judgment at first instance where it was held that various payments made by a company to a close associate of a director of a company were not unreasonable director related transactions pursuant to Section 588 FE(6).

The Court of Appeal held that the payments did constitute unreasonable director related transactions and this decision provides guidance as to:

Introduction

Incidents of insolvency in the construction industry are under the spotlight after the recent failure of a number of construction companies¹. Insolvency events affect not only the insolvent company, but all of those involved in the project supply chain, from suppliers and subcontractors who have not received payment for goods and works supplied, to owners and developers who experience delays and increased costs to their projects.

The decision of Austino Wentworthville Pty Ltd v Metroland Australia Limited & Ors [2013] NSWCA 59 was an appeal brought by Austino against Metroland and its voluntary administrator Mr Levi (“Levi”) to amend a proof of debt for the purpose of voting at a meeting of creditors in a voluntary administration.

The decision is relevant to insolvency practitioners who act as voluntary administrators in assessing voting entitlements in the voluntary administration process in addition to creditors who offer assets as security to obtain finance.

Background

The Facts

In this case the liquidators of Octaviar Administration had obtained an extension to the time for them to bring voidable transaction proceedings under section 588FF(1) of the Corporations Act (Extension Order). Before the expiration of the Extension Order, the liquidators sought a further extension under s588FF(3)(b) or, alternatively, asked the Court to vary the date in the Extension Order pursuant to the Court’s procedural powers under r 36.16 of Uniform Civil Procedure Rules 2005 (NSW) (UCPR).

The recent New South Wales Supreme Court (Court) decision in Plaza West Pty Ltd (in liquidation) (subject to a deed of company arrangement) [2013] NSWSC 168 involved an application to terminate the winding up of a company subject to a deed of company arrangement (DOCA) and emphasised the importance of comprehensive reports from the company’s administrators and experts, in deciding that application.

Background

In Saraceni v ASIC [2013] FCAFC 42 the Full Court of the Federal Court of Australia confirmed that it is not necessary for ASIC to provide potential examinees with an opportunity to be heard prior to authorising receivers to conduct examinations under s596A of the Corporations Act.

FACTS