Section 588G of the Corporations Act 2001 (Cth) imposes a positive duty on company directors to stop a company they control from incurring a debt once it has become insolvent. Insolvent trading claims often constitute one of the easiest recoveries available in liquidation. Complexities however can arise when considering when…
9 April, 2024
Duties of a liquidator when selling company property
Section 420A of the Corporations Act 2001 (Cth) (Act) obliges a receiver exercising a power of sale to take all reasonable care to sell the property for market value or the best price reasonably obtainable. This is typically a heavy duty. Liquidators are not subject to section 420A of the…
Congratulations! You have just obtained an adjudication certificate. What comes next if the respondent refuses to pay the adjudicated amount? Knowing how to enforce SOPA debts is essential for construction industry participants who want to exercise their right to receive progress payment. Two potentially powerful options available to claimants are…
15 March, 2024
Taking Security from Related Entities of a Borrower – Unreasonable Director-Related Transactions
Case note - Cooper as Liquidator of Runtong Investment and Development Pty Ltd (In Liq) v CEG Direct Securities Pty Ltd FCA 6 The recent case of Cooper as Liquidator of Runtong Investment and Development Pty Ltd (In Liq) v CEG Direct Securities Pty Ltd FCA 6 (Cooper), shed light…
8 March, 2024
Personal Liability of Administrators
The personal liability arising under Division 9 of Part 5.3 A of the Corporations Act 2001 (Cth) (Act) often provides one of the greatest risks facing administrators on accepting an appointment. These risks can limit restructuring options available through a voluntary administration as an administrator is unlikely to want to…
29 February, 2024
Substituting Creditors – Why You Should Join A Winding Up Petition
What you need to know Where a company that owes you money is subject to a winding up application brought by an unrelated third party, you should always seek to join the proceedings as a supporting creditor. If you are a supporting creditor, you have a right to apply to…
1 December, 2023
Using DOCAS To Preserve SOPA Claims In Administrations?
Commercial Context Construction companies are often thinly capitalised and do not hold significant real property or other assets. Often their most significant (and sometimes their only) assets are unpaid progress claims arising from construction work undertaken prior to entering into external administration. Progress claims however can be difficult to recover.…
6 November, 2023
The PJC’s Corporate Insolvency Report
On 12 July 2023, the Parliamentary Joint Committee on Corporations and Financial Services (PJC) released a comprehensive report on corporate insolvency in Australia. This report made 28 recommendations focused on addressing various issues in the current Australian corporate insolvency space and raised some issues in the personal insolvency sector. The…
13 October, 2023
Can statutory demands and set aside applications be served by email?
Bioaction Pty Ltd v Ogborne, in the matter of Bioaction Pty Ltd FCA 436 Statutory demands and applications to set aside a statutory demand may be served by email, however this manner of service is fraught with danger. The requirements for effective service are more complicated and the onus for…
22 September, 2023
Recovery of judgment debts – Garnishee and Writs
If you have obtained a judgment in your favour and the judgment debtor has failed to pay the judgment amount to you, what are your options? This article looks at two ways you can enforcement a judgment: a garnishee order and a writ. Garnishee order A garnishee order imposes an…