You’ve been served! Federal Court of Australia affirms recent amendments to modernise the Corporations Act
In Bioaction Pty Ltd -v- Ogborne, in the matter of Bioaction Pty Ltd [2022] FCA 436 (Bioaction), her Honour Justice Cheeseman considered whether an application to set aside a statutory demand was served within the 21-day period as provided for in Section 459G of the Corporations Act 2001 (Cth) (the Act). In deciding this matter, […]
ReadmorePower to sell – Federal Court exercises discretion to allow company to realise trust assets
In Brooks, in the matter of Tease Hair & Spa Pty Ltd (in liquidation),[1] the Federal Court made orders in favour of the Liquidator, pursuant to section 90-15 of Schedule 2 to the Corporations Act 2001 (Cth) (Insolvency Practice Schedule (Corporations)) and section 47 of the Trustee Act 1989 (Tas) allowing the Liquidator to realise […]
ReadmoreAnti-phoenixing laws demystified: The Victorian Supreme Court considers the creditor-defeating disposition regime
In Re Intellicomms Pty Ltd (in liq) [2022] VSC 228, it was determined that a sale agreement was a creditor-defeating disposition within the meaning of section 588FDB of the Corporations Act 2001 (Cth) (Act) and voidable pursuant to section 588FE(6B) of the Act. The Court held that, the consideration payable by the transaction was less […]
ReadmoreAn easy win? Obtaining summary judgment in the absence of the Defendant
In the matter of Squirrel Limited (In Liquidation), the Court considered an application for summary judgement against a director for insolvent trading. In doing so, the Court considered the principles underpinning a director’s duty to prevent insolvent trading and the compensation payable as a result. Background The first plaintiffs, Mr Brent Kijurina and Mr Richard […]
ReadmoreTrying to pull a fast one: An attempt to use family law orders to defeat creditors
Family law processes cannot be used to defraud creditors. In Re ZH International Pty Ltd (in liq),[1] the Supreme Court of New South Wales held that transfers of property from a company to the directors and shareholders of that company as part of family law proceedings were voidable transactions under section 588FF of the Corporations […]
ReadmoreThe Court’s willingness to extend the convening period for a meeting of creditors where the administration is large and complex
In Algeri, in the matter of WBHO Australia Pty Ltd (Administrators Appointed) [2022] FCA 169, the Federal Court heard the second application by the administrators who were seeking an extension to the convening period for the second meeting of creditors, which pursuant to section 439A(5) of the Corporations Act 2001 (Cth) (the Act) was set […]
ReadmoreFederal Court’s refusal to grant leave to amend pleadings
On 11 February 2022 in Canavan v ICRA Rolleston Pty Ltd (Receivers and Managers Appointed)(in liquidation) [2022] FCA 117 the Federal Court of Australia refused to permit the Plaintiff to amend his points of claim less than two weeks before trial. In considering the legal principles and matters relevant to the exercise of the court’s […]
ReadmoreSetting off on the wrong foot: creditors are now unable to rely on statutory set-off to defend an unfair preference claim by a liquidator
In a special question reserved for consideration, the Full Federal Court considered whether statutory set-off under s 553C(1) of the Corporations Act 2001 (Cth) (the Act) was available to defend against a liquidator’s claim to recover an unfair preference under s 588FA of the Act. The unanimous and somewhat emphatic answer to this question delivered […]
ReadmoreNSW Supreme Court provides guidance on the procedural requirements for disputes determined by AFCA
The case of Australian Capital Financial Management Pty Limited v Australian Financial Complaints Authority Limited (2021) NSWFC 1577 concerned an application made by Australian Capital Financial Management Pty Ltd seeking to have the Court set aside a previous determination made by AFCA. Background In 2014, Mr Bai, Ms Yang and Mr Lee established Australian Sheepskin […]
ReadmoreIs it Just? Federal Court of Australia considers whether to reinstate a deregistered company and whether the deregistration itself prevented the proposed plaintiff from filing within the limitations period
In deciding whether to reinstate a deregistered company (and suspend a limitation period to allow the company to commence proceedings), the primary question for the court is whether it is just to do so. In the recent decision of the Federal Court in Price, in the matter of Advanced Polymer Recycling Pty Ltd v Australian […]
ReadmoreAn administrator’s right to remuneration out of trust property
In Australian Securities and Investments Commission v Marco (no 9) [2021] FCA 1306 the Administrators brought an interlocutory application seeking remuneration orders pursuant to section 60-10(1)(c) of the Insolvency Practice Schedule (IPSC) for the administration of the second defendant. The application was opposed by the Liquidators of the second defendant. Justice McKerracher ultimately held that […]
ReadmoreGroup costs orders – The way of the future?
The Victorian Supreme Court’s decision in Fox v Westpac Banking Corporation; Crawford v Australia and New Zealand Banking Group Limited[1] was the first determination of an application seeking a group costs order in Australia. Whilst the Plaintiffs’ applications were ultimately unsuccessful, the Court decided to adjourn the applications (rather than dismiss them altogether) in order […]
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