Court finds statutory duties breached by ‘de facto director’

This week’s TGIF examines a recent NSW Supreme Court decision that illustrates the circumstances in which a person will be regarded as a ‘de facto director’ and the duties owed to creditors when facing insolvency.

Key takeaways

Filed under:
Australia, New South Wales, Company & Commercial, Insolvency & Restructuring, Litigation, Cybersecurity, Insolvency, Corporations Act 2001 (Australia), Australian Taxation Office, New South Wales Supreme Court
Location:
Australia
Bruton Holdings – ATO has no power to garnishee debt after commencement of winding up

Introduction

By unanimous decision in Bruton Holdings Pty Limited (in liquidation) v Commissioner of Taxation1, five members of the High Court have reversed a controversial decision of the Full Federal Court to confirm that the Commissioner of Taxation (Commissioner) cannot ‘leap-frog’ other creditors in a liquidation.2

Filed under:
Australia, Insolvency & Restructuring, Litigation, Tax, Herbert Smith Freehills LLP, Debt, Liability (financial accounting), Liquidation, Liquidator (law), Corporations Act 2001 (Australia), Australian Taxation Office, High Court of Justice, Federal Court of Australia, High Court of Australia
Authors:
Paul Wenk
Location:
Australia
Firm:
Herbert Smith Freehills LLP