In our previous blog post, we examined the decision of the New South Wales Court of Appeal to uphold the composition of classes of creditors in the Boart Longyear restructuring by way of scheme of arrangement.

In one of the most significant decisions relating to schemes of arrangement in Australia in recent years, the New South Wales Court of Appeal has dismissed an appeal challenging the composition of classes of creditors in the Boart Longyear restructuring.

In a much anticipated judgment, the Court of Appeal of the Supreme Court of NSW has delivered good news for insolvency practitioners concerning their remuneration. This news will be particularly welcome for those practitioners who accept appointments over small to medium sized companies.

The NSW Court of Appeal recently confirmed that the bankruptcy of a personal trustee or appointer of a family trust does not affect the protection afforded to the family trust assets by the trust structure. 

A creditor of a company subject to a Deed of Company Arrangement (DOCA) was recently successful in seeking termination of the DOCA by the court. As a result of the company's non-compliance with the DOCA, the majority of creditors resolved to extend the term of the DOCA and increase the amount to be paid by the company. The applicant creditor alleged that the DOCA should be terminated because the company had failed to make payment in accordance with it, and the variation had not taken effect.

The Court made an order terminating the DOCA on the grounds that:

The recent New South Wales Supreme Court decision In re MF Global Australia Ltd (in liq) No 2 [2012] NSWSC 1426 confirmed that the remuneration, costs and expenses incurred by liquidators in preserving, recovering and realising trust assets should be paid out of the trust property generally, rather than being restricted to assets held on trust for the benefit of the company itself.

In the matter of Free Wesleyan Church of Tonga in Australia (inc (administrators appointed) Phoenix Lacquers & Paints Pty Limited v Free Wesleyan Church of Tonga in Australia Inc (administrators appointed) & Ors [2012] NSWSC 214 (13 March 2012), the plaintiff, Phoenix Lacquers, sought a declaration regarding the validity of a resolution to remove and replace joint and several administrators of the Free Wesleyan Church of Tonga which did not succeed.  The Free Wesleyan Church of Tonga in Australia was incorporated under the Associations Incorporation Act 2009 (NSW) and

The New South Wales Supreme Court decision in Rapid Metal Developments (Aust) Pty Ltd v Rildean Pty Ltd (No 3) examined the Australian statutory provision that is broadly equivalent to s 32(5) of the Receiverships Act (NZ).

In Re Boart Longyear Ltd (No 2) the Supreme Court of New South Wales recently approved two creditor schemes of arrangement on the application of Boart Longyear Limited. The schemes were considerably amended after the Court indicated at the first hearing that it was not likely to approve the original schemes on fairness grounds. Significantly, the Court ordered the parties to attend a mediation to resolve the fairness issues – something that has not been done before in a scheme of arrangement in either Australia or the United Kingdom.

In Power Rental Op Co Australia, LLC v Forge Group Power Pty Ltd (in liq) (receivers and managers appointed) the New South Wales Court of Appeal recently considered the 'fixtures' exclusion in Australia's Personal Property Securities Act (PPSA).

Power Rental agreed to lease turbines to Forge Group for two years.  Shortly after the lease began, Forge Group entered voluntary administration.