Registration will be mandatory under the Insolvency Practitioners Bill as reported back to the House by the Commerce Committee. This is a radical and far-reaching change from the negative licensing regime initially proposed in the Bill.
This Brief Counsel summarises and comments on the Committee’s report.
Big receiverships often test legal boundaries, and the Crafar group receivership is no exception. Gibson & Stiassny v StockCo & Ors1 is the longest decision to date on the Personal Property Securities Act 1999 (PPSA).
Although the facts are complex, the practical take-outs are fairly simple:
The mere existence of a secured remedy against another party is not a substantial ground for refusing to allow a creditor to pursue a remedy against a guarantor.
A liquidator may assign to a third party funder, among other things:
- the rights that are conferred on the liquidator under statute to bring a claim on behalf of the company. For example, rights accruing to the liquidator under the voidable transaction provisions of the Companies Act 1993
- a company's rights that exist at the time of liquidation.
Bank B sought adjudication in bankruptcy of F.
The residual powers that directors of a company in receivership have to commence a claim by that company without the receivers' consent were recently considered by the High Court.
A recent UK High Court decision on the issue of balance sheet insolvency will be of interest in New Zealand, despite the fact that the respective statutory solvency tests differ.
The court had made orders for examination of 4 current and former directors of New Image by the liquidators of Omegatrend.
In Katavich v Meltzer & Ors, the court confirmed that pursuant to ss 284 and 321 of the Companies Act 1993 (Act), liquidators can be removed notwithstanding that their final report has been filed and the company is to be struck off the Register.
In Nylex (New Zealand) Ltd (In Rec and in Liq) v Independent Timber Merchants Co-Operative Limited Justice Heath granted summary judgment to Nylex and rejected ITM's argument that it had a defence of equitable set-off relating to unpaid loyalty scheme obligations.