This week’s TGIF considers In the matter of Fellmane Pty Ltd (in liq)[2020] NSWSC 595, a recent decision in which the NSW Supreme Court declined to give directions approving a proposed transaction proposed by a liquidator of the trustee and the receiver of that trust which would have extinguished the trustee’s right of indemnity against the principal debtor.

Key takeaways

This week’s TGIF considers a recent Federal Court decision where the Court found a company’s general purpose liquidators had not acted unreasonably in opposing an application that special purpose liquidators also be appointed.

Background

This week’s TGIF considers a recent application for injunctive relief by a bankrupt to restrain liquidators who initiated his examination from continuing to retain their lawyers, given the firm had previously represented the examinee.

What happened?

On 8 August 2016, Richard Nash became bankrupt, on his own petition, and was later served with a summons for examination and orders for the production of books and records.

This week’s TGIF considers Re Broens Pty Limited (in liq) [2018] NSWSC 1747, in which a liquidator was held to be justified in making distributions to creditors in spite of several claims by employees for long service leave entitlements.

What happened?

On 19 December 2016, voluntary administrators were appointed to Broens Pty Limited (the Company). The Company supplied machinery & services to manufacturers in aerospace, rail, defence and mining industries.

On 9 April 2018 Linc Energy Ltd (in liquidation) was convicted of causing serious environmental harm at its pilot underground coal gasification facility near Chinchilla, Queensland.

Administrators were appointed to the company on 15 April 2016. On 23 May they were appointed liquidators after creditors resolved that the company be wound up.

This week’s TGIF considers Singh v De Castro [2017] NSWCA 241, where the New South Wales Court of Appeal held that five directors of an insolvent corporate borrower had executed and were bound by personal guarantees.

BACKGROUND

The decision was an appeal from a decision of the District Court of New South Wales finding that five directors of an insolvent corporate borrower had executed and were bound by personal guarantees.

This week’s TGIF considers a recent Federal Court decision in which relief was sought under section 588FM of the Corporations Act to ensure a security interest perfected after the ‘critical time’ did not automatically vest.

What happened?

On 7 April 2016, administrators were appointed to OneSteel. OneSteel, a member of the Arrium Group of Companies, subsequently entered into a deed of company arrangement.

This week’s TGIF considers the decision of Ziziphus Pty Ltd v Pluton Resources Limited (Receivers and Managers Appointed) (Subject to Deed of Company Arrangement) where the Court favoured the public interest in terminating a DOCA

Background

A company which was engaged in iron ore mining, had been struggling financially for a number of years. In 2013, receivers were appointed to manage the company’s property and since mid-2015, the company had failed to discharge its royalty obligations to the State of Western Australia.

This week’s TGIF considers the decision of Crowe-Maxwell v Frost [2016] NSWCA 46 in which the Court held that a liquidator did not discharge his onus of proving relevant transactions were unreasonable director-related transactions.

BACKGROUND

Background

In Re CMI Industrial Pty Ltd (in liq); Byrne & Ors v CMI Limited [2015] QSC 96, liquidators sought directions as to whether they were required to pay trading profits made by the receivers to priority creditors under s433 of the Corporations Act.