Background

On 7 December 2015, the Australian Government released its "National Innovation and Science Agenda" ("Agenda"). In the Agenda, the Government outlined its intention to make three significant reforms to Australia's insolvency laws, adopting the recommendations of the Productivity Commission ("Commission") in its report, "Business Set-Up, Transfer and Closure" ("Report"), released on the same day as the Agenda:

In Short

The Situation: In the recent decision of Morton as Liquidator of MJ Woodman Electrical Contractors Pty Ltd v Metal Manufacturers Pty Limited [2021] FCAFC 228, the Full Court of the Federal Court of Australia considered the availability of mutual set-off provisions in s 553C the Corporations Act 2001 (Cth) as a defence to unfair preference claims.

Key Points  

Introduction

On Tuesday 10 June 2014 in the Australian Capital Territory Industrial Magistrates Court, an early mention in the Kenoss Contractors case was heard.  This case includes a prosecution of both an organisation for allegedly failing to meet the primary health and safety duty and an officer for allegedly failing to exercise due diligence under the Work Health and Safety Act 2011 (ACT) which commenced on 1 January 2012.  This case is ostensibly the first prosecution of an officer under the new harmonised WHS laws.

Background

A recent Federal Court of Australia decision in the administration of the Hastie Group Limited (Hastie Group)¹ illustrates a number of important points for administrators, secured parties and purchasers under the new regime established under the Personal Property Securities Act 2009 (Cth) (PPSA). If you would like to discuss the implications of this case with any of our PPSA or insolvency litigation experts, please do not hesitate to contact us.

The facts

In our March 2012 Insurance Update we considered the potential widening of the scope for creditors to claim damages against a director personally for contravention of the Corporations Act 2001 (Act). The Supreme Court of Queensland awarded Phoenix Constructions over $1.2 million in damages against Mr McCracken for contravention of s 182 of the Act. This decision, a first of its kind, was appealed by Mr McCracken.

At the end of 2011, the Federal Government introduced two draft Bills directed at clamping down on companies that engage in “phoenix” activity.

On 5 October 2011, the NSW Supreme Court upheld an application pursuant to s 440D(1) of the Corporations Act 2001 (Cth) (the Corporations Act) for leave to bring and continue proceedings against a defendant under voluntary administration.

Introduction  

Another failed property developer has just been made bankrupt in Australia, this time with a difference – he was already bankrupt in New Zealand. Bank of Western Australia (Bank) v David Stewart Henderson (No. 3) [2011] FMCA 840 is another Australian cross-border insolvency case in which we have successfully tested the boundaries of the Cross-Border Insolvency Act 2008 (Cth) (the CBIA), this time with the Bankruptcy Act 1966 (Cth).

Introduction

New Zealand liquidators have had their powers recognised in Australia in a series of recent ground-breaking judgments.

These decisions in respect of Northern Crest Investments Limited, a New Zealand registered company listed on the ASX, demonstrate the broad powers which the courts are willing to provide to foreign representatives under the Cross-Border Insolvency Act 2008 (Cth) (the CBIA).

Obtaining powers of Australian liquidators