As the name suggests, the UNCITRAL Model Law on Cross-Border Insolvency 1997 (Model Law) seeks to address complexities caused where insolvencies cross borders, while leaving substantive insolvency laws of each country largely unaltered. However, as jurisdictions continue to adopt and interpret the Model Law, inconsistencies in its application are coming to light.
On 11 December 2019, the NSW Court of Appeal found that an administrator should not have used his casting vote to block a resolution for the appointment of a different person as the company’s liquidator. The decision (Glenfyne International Holding Limited v Glenfyne Farms International AU Pty Ltd (in liq) [2019] NSWCA 304) reverses a previous decision where the Court found that it did not have the power to disturb the result of the vote.
Background
The Federal Court of Australia recently struck off an insolvency practitioner from the register of liquidators and restrained him for ten years for acting as an insolvency practitioner. The case concerns the conduct of David Iannuzi, who the Court found had "repeatedly fell short of the standards that would ordinarily be expected of him as a competent registered liquidator". The judgment sets out in detail the conduct that the Court found to be unsatisfactory and serves as a reminder of the standards expected of liquidators.
Background
The Federal Court has considered whether a deed of company arrangement (DoCA) binds a regulator. The case involved an application by the Fair Work Ombudsman (FWO) for leave to proceed against a company in liquidation. The Court rejected the company’s argument that the FWO’s claims were extinguished by the DoCA and granted the FWO leave to pursue the claim. The outcome of the proceedings may impact the types of, and circumstances in which, claims by a regulator will not be extinguished by a DoCA.
In brief...
The use of creditors’ schemes of arrangement is on the rise in Australia. Along the way the Australian courts have made valuable contributions to international scheme jurisprudence. In this article we look at some of these contributions and then explore how Australian law might be further developed to remain a leading jurisdiction for creditors’ schemes.
Advantages of schemes as a restructuring tool
This week’s TGIF considers the decision in Dudley (Liquidator) v RGH Construction Fitout & Maintenance Pty Ltd (No 2) [2019] FCA 1355, where the Court exercised its discretion to cure a procedural irregularity in a mothership proceeding.
This week’s TGIF considers the latest chapter in the story of Legend International Holdings Inc, where the Court of Appeal considered whether Legend was insolvent, whether mining tenements held by Legend’s subsidiary constituted ‘readily realisable assets’, and whether various deeds entered into by Legend were void as uncommercial transactions.
The equitable doctrine of marshalling can protect the security interests of subordinate secured creditors when a debtor becomes insolvent.
Marshalling is a neglected tool in the insolvency toolbox, but it can play an important role in protecting the security interests of subordinate secured creditors.
Recent amendments brought about by the National Health Amendment (Pharmaceutical Benefits) Bill 2019 (Cth) allow for the supply of pharmaceutical benefits by approved pharmacies under the Pharmaceutical Benefits Scheme (PBS) to continue following external administration or bankruptcy (section 91B, National Health Act 1953 (Cth) (Act)).
This week’s TGIF considers a recent decision of the Supreme Court of Western Australia regarding an application for a company to be wound up under s 459P of the Corporations Act or, alternatively, on just and equitable grounds.
What happened?