As the Courts have often stated, in bankruptcy and insolvency law, time is of the essence. Bankruptcy and insolvency legislation allows the Court to craft orders with the specific aim of shielding a Receiver against frivolous actions, such that the Receiver may complete his task of managing property while enforcing the rights of a secured creditor in a timely fashion. The HRH Hotels Ltd. case is one such example where the Court ruled that a plaintiff's claim against the Receiver was frivolous and constituted a collateral attack on the Receivership process.
Most or all creditors who lend to farmers will be familiar with the Farm Debt Mediation Act, S.C. 1997, c. 21 (the “FDMA”) and the need to serve a notice under the FDMA before taking action against a farmer. However, there are some details of how the FDMA operates that may not be as well-known. This piece will highlight some of those details.
Trust claims against a borrower’s assets are something that no secured creditor wants to be confronted with. Such claims are often unexpected because they are, for the most part, undetectable. They lurk in the shadows, out of the reach of traditional due diligence measures and PPSA searches. As a result, even the most prudent of creditors can sometimes find themselves facing these undocumented and unquantifiable claims.
Grant Forest Products Inc. v. The Toronto-Dominion Bank, 2015 ONCA 570
The recent judgment of the Western Australian Court of Appeal in Hughes v Pluton Resources Ltd 1, concerns the interaction between a deed of company arrangement (‘DOCA’) under Part 5.3A of the Corporations Act 2001 (Cth) (‘CA’) and the Personal Property Securities Act 2009 (Cth) (‘PPSA’).
The Boart Longyear decisions confirm that class constitution remains a critical issue for review when pursuing creditors' schemes of arrangement.
The New South Wales Court of Appeal has recently confirmed the circumstances in which companies seeking approval of schemes of arrangement will be required to convene separate meetings for different classes of creditors.
Class constitution: key principles
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 the recent Federal Budget, one change that hasn’t been given media attention is a change to the GST Legislation, which is to become effective from mid-July 2018 whereby purchasers of ‘new constructed residential premises’ and ‘new subdivisions’ become responsible to remit the GST to the Australian Taxation Office (ATO).
The Government has not published any details as to how these changes are going to operate other than claiming that the ATO expects to recover upwards of $650 million in GST revenue over the next four years.
Throughout 2016 a series of judgments were delivered that gave conflicting guidance to practitioners about what they should consider when accepting a voluntary administration appointment.
When a secured creditor appoints a receiver it is usual for them to sign an agreement setting out the terms of the receiver’s appointment, including payment of the receiver’s remuneration, costs and expenses. Appointment documents commonly contain indemnity clauses in which the secured creditor agrees to indemnify the receiver in specified circumstances.