#SVVoidables by Matthew Hudson
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The very recent third party unfair preference payment case from the Vic Court of Appeal seems to have got quite a lot of people talking, and some have gone as far to say that it’s a big change in the existing law. My two cents: it’s not! Case: Cant v Mad Brothers Earthmoving Pty Ltd…
BREAKING: payments made by a company previously under a Deed Administration (or DOCA) to the ATO are recoverable as unfair preferences (once in liquidation) and not ‘by, or under the authority’ of the Deed Administrators within the meaning of s 588FE(2B)(d) Corporations Act. From the Federal Court today. These payments relate to post-VA debts owed…
DON’T MAKE VT EXTENSION REQUESTS THE DAY BEFORE‼️ I am rarely flummoxed by a voidable transaction (VT) case, but Friday’s one has got me. On appeal, the VSC has quashed an earlier decision to extend the period in which a Liquidator has to commence a VT proceeding. The claim now falls outside its statutory time…
BANKRUPTCY UNFAIR PREFERENCE 🚨 according to a recent decision, payments made from the trust account of a lawyer to a petitioning creditor are susceptible to claw-back under s 122 of the Bankruptcy Act. … even if the trust monies were sourced from a related third party entity (ie it was never the Bankrupts money). ……
Your #VelocityRewards look pretty safe to me! I spent an hour this evening with publicly available FY18/19 financials for the 4 main entities controlling Rewards, and this is what I worked out: 1. the corporate structure I could quickly piece together is summarised on the first page of the PDF. I assume we are each…
Mothership proceedings for multiple voidable transaction claims are alive and thriving, thanks to a number of recent decisions. For those unaware, if a liquidator has say 10 unfair preference claims that they wish to proceed against creditors, the liquidator can apply to court to run all 10 matters as (effectively) 1 matter. This can save…
In January 2020 the COVID-19 coronavirus was declared a Listed Human Disease, meaning the Biosecurity Act 2015 (Cth) can now be used by Government to its full effect. It means (amongst other things) a person can be directed or forced to self-isolate for an indefinite period of time. In the context of the insolvency profession…
I have been writing all week about the new creditor defeating dispositions (CDD) and today am looking at the new ASIC CDD powers (s 588FGAA of the Corporations Act 2001). Sarah’s Garage is trading well, but has fallen behind on its BASs. Rather than pay the ATO, Sarah’s Garage is convinced by dodgy Dan to…
Yesterday I posted about the new creditor defeating dispositions (‘CDD’). Today I am looking at defences. Imagine Co A sells its tyre shop business to Co B and nearly 1 year later enters liquidation. If Co A Liquidator pursued Co B for a CDD, what defences are available: 1. Commerciality of recovering monies from Co…
And here I thought CD’s were going the way of the dodo, insolvency law now has a CDD, or ‘creditor defeating disposition’, as a weapon to combat illegal phoenixing. The law came into effect on 18 February 2020, but ONLY applies to dispositions entered on or after that date. What is a CDD? See s…
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