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When might you need a solvency report?

1. Preventing a winding-up application (most common type) 2. Fighting a voidable transaction claim that the Liquidator says occurred when the company was insolvent (very common) 3. Trying to stave off bank recovery or foreclosure action 4. Proving to the board of directors that a Voluntary Administration or #safeharbour proposal is the only option 5.…

Using maths to defeat a prefo

There are many ways to skin a cat (poor cat I know), but when it comes to unfair preferences the best way to defend against a claim is to use some simple maths. Meet Zoey’s Design. Zoey’s has a $50k trade credit account with Harry’s Hardware Store. Zoey’s carries on a home decorations business, but goes into Liquidation a…

48 cents below

“The statutory demand is set aside, and, on condition that the creditor commences fresh proceedings within 28 days to recover their outstanding debt, the debtor company must pay $2,000 into court.” This was the finding of a recent NSW Supreme Court (“SC”) case (called Wabbits). Two things to note: 1) In the last 2 months, there is an…

QuickBooks is a ‘kept book’

It’s official, #QuickBooks is a ‘kept’ ‘book’ for the purposes of the Corporations Act, thanks to a WA Supreme Court decision handed down last Wednesday. 7 barristers and a day of hearings, lead Justice Tottle to this groundbreaking conclusion. The issue was in relation to whether or not a liquidator could rely upon QuickBooks in pursuing various voidable…

Let’s fix our search registers!

Thoughts on Aus Gov creating a register of all partnerships, trusts, sole traders, trading trustee company identities, free of charge and readily accessible? ABR.gov.au definitely does not count. Why in 2018, is it still so hard to work out who the trustee of a trading trust is, or, more generically, who your customer is? If…

IGT review of garnishee notices announced

As of today, the use and ‘abuse’ of ATO garnishee notices are to be reviewed by the Inspector-General of Taxation. The review is said to have been inspired by the #FourCorners program that many would be familiar with. The review will include the consideration of “how the ATO considers circumstances of taxpayers such as vulnerable small businesses…

Some big NSW Court of Appeal cases soon to be decided

Some big NSW Court of Appeal decisions should be handed down in the next couple of months and they have got this insolvency nerd a little excited … 1. South Head & District Synagogue – the first instance decision ruled that an Administrator could not ‘sack’ a Rabbi of the Jewish faith, because the contract of employment had incorporated…