This week’s TGIF considers the recent case of Halifax Investment Services Pty Ltd (In liquidation) (No 4) [2019] FCA 604 where the Federal Court granted an application by liquidators of a company to electronically publish notices required to be sent to creditors as part of their initial reporting obligations in a winding up, to save costs and time, in cir

The NSW Supreme Court has reaffirmed the criteria for a Court to inquire into a liquidator’s conduct. It is necessary to show that there is at least a ‘well-based suspicion’ indicating a need for further investigation. ‘Mere wondering’ is not enough.

In exercising its discretion, a Court will also consider the nature and gravity of the allegations against the liquidator, delays in seeking an inquiry, the utility of an inquiry and the existence of alternative remedies.

Background

Introduction

The NSW Supreme Court has provided guidance on the scope and operation of ss 70-45, 70-55 and 70-90 of the Insolvency Practice Schedule (Corporations) (IPSC) in The Matter of 1st Fleet Pty Ltd (in liquidation) [2019] NSWSC 6.

In the recent case of In the matter of Gondon Five Pty Limited and Cui Family Asset Management Pty Limited [2019] NSWSC 469, the New South Wales Supreme Court (Brereton J) considered the purpose and scope of an appointment as receiver to a company, and came down particularly hard on an insolvency practitioner for performing work and incurring expenses which were determined to be outside, or not incidental to, the scope of his appointment.

Background

Who should read this eBrief:

This week’s TGIF examines a decision of the Victorian Supreme Court which found that several proofs had been wrongly admitted or rejected, and had correct decisions been made, the company would not have been put into liquidation.

BACKGROUND

This week’s TGIF takes a look at the recent case of Mills Oakley (a partnership) v Asset HQ Australia Pty Ltd [2019] VSC 98, where the Supreme Court of Victoria found the statutory presumption of insolvency did not arise as there had not been effective service of a statutory demand due to a typographical error in the postal address.

What happened?

This week’s TGIF considers a recent decision of the Victorian Court of Appeal where a company’s creditors successfully opposed an application by the company’s liquidators to compromise proceedings commenced on the company’s behalf.

Introduction

We recently acted for the Commonwealth (Represented by the Australian Government Department of Jobs and Small Business) in Re Stay in Bed Milk and Bread Pty Ltd  [2019] VSC 181, in which the Supreme Court of Victoria determined that a franchisor’s marketing fund was not subject to a trust (express or Quistclose) in favour of franchisees and therefore was available for distribution to the franchisor’s priority creditors, including the Commonwealth.

ASIC’s record with land banking schemes has been the story of shutting the stable door after the horse has bolted. It has wound up insolvent schemes long after the investor’s cash has well and truly dissipated.

For example: