Personal Bankruptcy – Page 2 – ░░░ INSOLVENCY INTERFACE

2014 version of Bill to amend corporate and personal insolvency laws

ASIC, Corporate Insolvency, Insolvency Law, Personal Bankruptcy, Regulation Comments Off

Nov 172014

On 7 November 2014 an exposure draft of the Insolvency Law Reform Bill 2014 (ILRB 2014) was released by the Australian Treasury for comment.

The Treasury Crest

Summaries:

The Treasury’s summary/promotion of the legislation is as follows:

“The draft Bill comprises a package of proposals to amend and streamline the Bankruptcy Act 1966 and the Corporations Act 2001. The proposed amendments will:

•remove unnecessary costs and increase efficiency in insolvency administrations;
•enhance communication and transparency between stakeholders;
•promote market competition on price and quality;
•boost confidence in the professionalism and competence of insolvency practitioners; and
•remove unnecessary costs from the insolvency industry resulting in around $55.4 million per annum in compliance cost savings.”

The Explanatory Material issued with the Bill opens with this outline:

“The Insolvency Law Reform Bill 2014 (Bill) amends the Corporations Act 2001 (Corporations Act), the Australian Securities and Investments Commission Act 2001 (ASIC Act) and the Bankruptcy Act 1966 (Bankruptcy Act) to create common rules that would:
• remove unnecessary costs and increase efficiency in insolvency administrations;
• align and modernise the registration and disciplinary frameworks that apply to registered liquidators and registered trustees;
• align and modernise a range of specific rules relating to the handling of personal bankruptcies and corporate external administrations;
• enhance communication and transparency between stakeholders;
• promote market competition on price and quality;
• improve the powers available to the corporate regulator to regulate the corporate insolvency market and the ability for both regulators to communicate in relation to insolvency practitioners operating in both the personal and corporate insolvency markets; and
• improve overall confidence in the professionalism and competence of insolvency practitioners.”

Links to government material:

The draft Bill (ILRB 2014) in PDF format

The Explanatory Material in PDF format

The Insolvency Practice Rules – Proposals Paper in PDF format

Coversheet for a submission by post

The Treasury website page

Previous Bill and background material:

The first version of ILRB 2014 appeared on 19/12/2012 as Insolvency Law Reform Bill 2012, but it never became law. However, the 2012 Explanatory Memorandum and the 2012 Exposure Draft contains valuable background information related to the current Bill. (Sixteen submissions were made for this 2012 consultation.)

Further background information regarding ILRB 2014 is available in the June 2011 Treasury Options Paper titled “A Modernisation and Harmonisation of the Regulatory Framework Applying to Insolvency Practitioners in Australia”. (Thirty three submissions were made for this consultation.)

The 2011 options paper was followed in December 2011 by a Proposals Paper with the same title. (Twenty nine submissions were made for this consultation.)

Submissions regarding ILRB 2014:

Closing date for submissions: Friday, 19 December 2014.

Email submissions are to be done online at:

http://www.treasury.gov.au/ConsultationsandReviews/Consultations/Submission-Form?parent={34029467-07BE-46D9-AA9E-86DAC3715DFF}

Address for written submissions:

Manager
Corporations and Scheme Unit
Financial System and Services Division
The Treasury
Langton Crescent
PARKES ACT 2600

For enquiries call Peter Levy at The Treasury on (02) 6263 3976.

Further posts on this site:

Further posts will be made on this blog site in the coming days with details of some of the proposed changes to corporate insolvency laws.

Financial Systems Inquiry poses questions about insolvency regime

Corporate Insolvency, Insolvency Law, Insolvency practices, Official Inquiries, Personal Bankruptcy, Practitioners Association (ARITA), Regulation Comments Off

Jul 172014

Is there evidence that Australia’s external administration regime causes otherwise viable businesses to fail and, if so, what could be done to address this?

This is the question being asked about external administrations in the Interim Report of the Financial System Inquiry (FSI) (July 2014). The FSI says it would value views on the costs, benefits and trade-offs of the following policy options or other alternatives:

No change to current arrangements.
Implement the 2012 proposals to reduce the complexity and cost of external administration for SMEs. [See below for details of these proposals.]

The brief section of the FSI’s report dealing with external administration may be viewed HERE. (The full report in pdf format is available HERE.)

David Murray, FSI chairman. Artwork from bluenotes.anz.com

US Chapter 11 regime?

Adoption by Australia of a US Chapter 11 style form of external administration could still be an option, although the FSI has already given it the thumbs down, as this extract from its interim report shows:

“The Inquiry considers adopting such a regime would be costly and could leave control in the hands of those who are often the cause of a company’s financial distress. Capital would be maintained in a business that is likely to fail, which would restrict or defer the capital from being channelled to more viable and productive enterprises. Adopting such a regime would also create more uncertainty for creditors by limiting their rights. The Inquiry notes that Chapter 11 has rarely enabled businesses to continue as going concerns in the long term. There is little empirical evidence that Australia’s voluntary administration process is causing otherwise viable businesses to fail. The Inquiry would like stakeholders to provide any empirical evidence that supports that view.”

Second round of submissions to FSI

Submissions in response to the Interim Report are due by 26 August 2014. Submissions can be lodged online using the Financial System Inquiry special facility, or may be lodged by email or post: fsi@fsi.gov.au or Financial System Inquiry, GPO Box 89, Sydney NSW 2001.

Insolvency reform proposals of 2012

The 2012 insolvency reform proposals to which the FSI specifically refers in its request for second round submissions concern:

Registration and discipline of insolvency practitioners (See note 1 at end of post for more information).
Specific rules relating to external administrations (note 2).
Regulator powers and miscellaneous amendments (note 3).

The Explanatory Material issued with the Insolvency Law Reform Bill on 19 December 2012 can be viewed HERE.

“Thought leadership”

The Australian Restructuring Insolvency & Turnaround Association (ARITA) (previously known as the Insolvency Practitioners Association) says it has embarked on “a major project to drive thought leadership around our insolvency regime”. It is asking insolvency practitioners who want to make a submission to FSI to work with the professional association:

“ARITA has embarked on a major project to drive thought leadership around our insolvency regime. Along with some of ARITA’s excellent previous work, significant new work has already been completed and ARITA members will soon be asked for comment on key aspects of our policy positions. This work is, obviously, well timed to support the FSI request for submissions. ARITA will actively work to represent the views of its membership and the profession to the FSI. We would urge all members and their firms to work with ARITA on providing strong and consistent representation to the FSI. If you or your firm is looking at making its own submission, please let ARITA know so that we can collaborate with you.” ARITA Press Release 15/7/2014

NOTES re Proposals in December 2012 Insolvency Reform Bill:

Note 1: Registration and discipline of insolvency practitioners

Common rules regarding: the physical registers of insolvency practitioners; registration and disciplinary Committees.

Note 2: Specific rules relating to external administrations

Common rules regarding: •

Remuneration and other benefits received by the insolvency practitioner;
The handling of administration or estate funds;
The provision of information by insolvency practitioners during an external administration or bankruptcy;
The meetings of creditors during an external administration or bankruptcy;
Committee of inspection formed as part of an external administration or bankruptcy; and
The external review of the administration of an estate or insolvency.

Note 3, part (a): Regulator powers and miscellaneous amendments

Provide ASIC with further powers to assist it in its oversight of the regulation of registered liquidators. In particular, the Bill amends the ASIC Act to:

enable ASIC to require the provision of information and books as part of an ASIC proactive surveillance program;
enable ASIC to provide administration information to a person with a material interest in the information; and
improve the transparency of ASIC oversight of the corporate insolvency industry.

Note 3, part (b): Regulator powers and miscellaneous amendments

Amend the Bankruptcy Act to enable ITSA to provide information relevant to the administration of the corporate law to ASIC.

Note 3, part (c): Regulator powers and miscellaneous amendments

A range of miscellaneous amendments, including:

amending the Acts to strengthen the penalties for breach of a bankrupt’s or directors’ obligations to provide a report as to affairs (RATA), or the books of the company, to an insolvency practitioner;
amend the Corporations Act to provide a process for the automatic disqualification of directors that have failed to provide a RATA, or the books of the company, to a registered liquidator until they have complied with those obligations; and
amend the Acts to enable the assignment of an insolvency practitioner’s statutory rights of actions.

Compliance by personal insolvency practitioners in 2012-13

Debt Administration, Insolvency practices, Insolvency Statistics, Personal Bankruptcy, Regulation, Standards Comments Off

Jan 242014

A Federal Government report on compliance by insolvency practitioners who work in the field of personal bankruptcy and insolvency, and are governed under the Bankruptcy Act 1966, was released on 16 January 2014. The 29 page report, published by Australian Financial Security Authority (AFSA), is titled

“Personal insolvency practitioners compliance report 2012-13”.

The phrase “personal insolvency practitioners” refers to Registered Trustees in Bankruptcy and Registered Debt Agreement Administrators.

A list of the CONTENTS is published below. For a copy of the report (PDF) CLICK HERE.

Free Insolvency & Recovery Services Directory

Corporate Insolvency, Debt Administration, Industry People, Insolvency Consultants, Personal Bankruptcy, Services Directory Comments Off

Jan 142014

On the Insolvency Interface blog site menu

I have created a directory facility for insolvency practitioners, lawyers and other consultants that provide specialist insolvency and recovery services (corporate and personal) to list their names and contact details. This facility is available free of charge and obligation free until 30 June 2014.

Just click on the menu item “Insolvency & Recovery Services Directory” (above).

Then on “Submit a Listing”, and follow the prompts. You will be asked to enter your category of service, business name, location, phone number, and a description of your services. You can also supply certain other information if you like, such as your web site address.

Visitors will be able search the directory by business name, category of service, location, etc.

Peter Keenan 14/1/2014

Liquidators’ professional association has new name and new head

Corporate Insolvency, Industry People, Insolvency practices, Personal Bankruptcy, Practitioners Association (IPAA) Comments Off

Jan 092014

It’s been announced today that from January 2014 the Insolvency Practitioners Association of Australia (IPAA) will be known as the Australian Restructuring, Insolvency & Turnaround Association (ARITA), and that from February 2014 the CEO of the association will be John Winter, former head of a professional association of accountants and a person with “an extensive background in media”.

In a notice to members, Denise North, current CEO of IPAA/ARITA, said she was “delighted to report that our new name and brand are now in place” and invited members to visit the association at arita.com.au

ARITA is being described as “the peak professional body in Australia for company liquidators, bankruptcy trustees, lawyers, financiers and academics involved in restructuring, insolvency and turnaround activity. It provides advice and assistance to its members on insolvency law and practice, gives advice to government on law reform, and generally represents the interests of those in the insolvency profession.”

John Winter’s career and specialities are detailed on his LinkedIn page.

Changes to code of conduct for liquidators and trustees

Checklists and guides, Corporate Insolvency, Ethics, Insolvency practices, Personal Bankruptcy, Regulation, Standards Comments Off

Sep 182013

In continuing to develop its Code of Professional Practice, the Insolvency Practitioners Association of Australia (IPAA) released a draft third edition on 6 September 2013.

The Code sets guidelines for the behaviour and practices of trustees appointed under the Bankruptcy Act and liquidators and other types of external administrators appointed under the Corporations Act.

The draft is open for comment until 27 September 2013, and the IPAA hopes that the new version will take effect from 1 January 2014.

Those invited by the IPAA to comment are “members, regulators, government agencies and other stakeholders” – which presumably includes financiers, creditors, insolvent debtors, company directors and shareholders. In fact, the IPAA’s announcement is headed “public consultation“.

The full text of the IPAA’s Explanatory Memorandum – which provides “an explanation of the major changes that have been made to the Code in the development of the third edition” – is reproduced below.

From: Kim Arnold (IPAA)
Date: 6 September 2013
Subject: Explanatory Memorandum Draft Third edition of the Code

Introduction

This document summarises the more significant changes to the Code and discusses the reasons for the changes. It also addresses some of the concerns arising out of the first round of consultation with the IPA’s Insolvency Specialist Working Group (ISWG), National Board and State Committees.

Disclosure of referrers (6.6)

A requirement has been added to the Code requiring a Practitioner to disclose the source of a referral in the DIRRI where the appointment follows a specific referral.

During the first round of consultation, concerns were raised about this new requirement, specifically around commercial sensitivity of this information and the impact this may have on the reputation of the referral source.

It is our view that the disclosure of the referral source of an appointment is important for the following reasons:

• Creditors have a right to know how the appointment came about and part of that process is who referred the appointment maker (directors, debtor) to the practitioner;

• It may be relevant to creditors if the referral source is subsequently engaged to provide services in the administration and subsequently paid by the administration;

• We have received numerous complaints about the practices of a number of referral agencies, however as their personnel are not members of the IPA (nor registered liquidators or registered trustees) we are unable to take any action in respect of these complaints. The disclosure of the referral source may assist the IPA in managing this industry issue.

Disclosure of remuneration pre-appointment (6.13)

A section has been added to the Code requiring Practitioners to provide certain information about remuneration to directors/debtor prior to a director/debtor appointment (not court or controller appointments). This is not a requirement to provide a quote or estimate, but if a quote or estimate is provided, it will need to be in writing.

We have received a number of complaints from directors stating that they were told one thing by a Practitioner prior to the appointment and the actual fees sought/drawn in the administration were completely different. As there is usually no documentary evidence regarding what was told to the director prior to the appointment, it is difficult for the Practitioner to be able to verify what information was provided. By providing information about remuneration in writing to the directors/debtor, the Practitioner will receive protection from misinterpretation and will be able to provide evidence of the information provided in the event of a subsequent complaint.

We have also received colloquial evidence from a practitioner that some practitioners are providing directors/debtors will very low fixed fee estimates in order to obtain appointments and subsequently charging remuneration at hourly rates and having that approved by creditors.

Practitioners will also be required to disclose any estimates or quotes provided to directors/debtors prior to appointment in the initial remuneration advice sent to creditors.

We have developed a template for use by Practitioners at 23.2.3

Disclosure of basis of and actual disbursements (15.3.2)

Although creditors do not have the right to approve disbursements, they do have the right to understand on what basis disbursements are recovered and the quantum of disbursements paid to the Practitioner’s firm.

To provide greater clarity to creditors on the basis on which internal disbursements (eg internal non-professional fee expenses) are recovered , Practitioners will be required to disclose the basis in the initial advice to creditors regarding remuneration. This requirement has been built into the template at 23.2.1.

To assist creditors with understanding what disbursements have actually been paid to the Practitioner, the following information must now be included in the remuneration approval report:

• general information on the different classes of disbursements;

• a declaration that the disbursements were necessary and proper;

• in relation to disbursements paid to the Firm, whether directly or in reimbursement of a payment to a third party:

– who the disbursement was paid to;

– what the disbursement was for;

– the quantity and rate (only for internal disbursements); and

– the amount paid; and

• details of the basis of any internal disbursements that will be charged to the Administration in the future (e.g. Page rate for photocopying done internally).

Note that payments direct to third parties by the Administration only need to be clearly included in the receipts and payments.

These requirements have been built into the report template at 23.2.2.

Payment of remuneration by secured creditors in non-controller appointments (15.5.5)

The Code now makes clear that any payments by secured creditors for the realisation of secured assets, in any appointments other than controller appointments, must be disclosed to the approving body and approved in the same way as other remuneration.

In our view, this is a codification of the law.

Section 449E in respect of VA is clear that an administrator is only entitled to remuneration as is determined by agreement with the COI, resolution of creditors or the Court.

Similarly, section 473 for liquidators states that the liquidator is entitled to receive such remuneration as is determined by agreement between the liquidator and COI, resolution of creditors or the Court.

In a bankruptcy, remuneration is fixed under section 162 by resolution of creditors or by the COI. A trustee may also make an application to the Inspector General. Under s 165, a trustee is not able to make an arrangement for receiving from any person any remuneration beyond the remuneration fixed in accordance with the Act.

In our view, it is clear that there is a statutory requirement for proper approval to be obtained to draw any remuneration in any such appointments.

There was resistance to this change to the Code in the first round of consultation. It has been suggested that the Practitioner would be acting as the agent of the secured creditor and thus acting outside the VA/liquidation/bankruptcy. In our view, acting as agent of the secured creditor would be a conflict that would prevent the continuation of the underlying insolvency appointment. ASIC has similar concerns regarding conflict issues.

Furthermore, we envisage that the administrator/liquidator/trustee would be using the ABN, GST registration and insurance coverage of the underlying administration.

The proper view, in our opinion, is that the VA/liquidator/trustee is selling those assets in their role as VA/liquidator/trustee and remitting the proceeds to the secured creditor (subject to any prior ranking creditor, for example section 561 in a liquidation). The VA/liquidator/trustee may withhold sufficient funds to meet the cost of selling those assets, but that money cannot actually be drawn as remuneration until approval is obtained from the approving body.

Identity of directors (20.2)

There is a new requirement in the Code for Practitioners to take appropriate steps to satisfy themselves of the identity of directors or a debtor prior to accepting an appointment where the appointment is being made by the directors or a debtor.

The requirement is to take appropriate steps, which means that the Practitioner should use professional judgement to determine what is appropriate in the circumstances.

This requirement is consistent with AFSA’s (previously ITSA) requirement to verify identity when lodging a debtor’s petition.

Joint appointments (20.3)

General guidance has been added to the Code stating that joint and several appointments:

• should be taken with the knowledge that all Appointees are equally responsible for all decisions made on joint and several appointments, and

• the firm should have in place policies and procedures to ensure that all appointees are knowledgeable about the conduct of the administration, even if one appointee is leading the conduct of the administration.

This is general guidance following a spate of disciplinary action against co-appointees that were not the lead appointee on the administration.

For the purpose of facilitating comment the IPAA has made this Explanatory Memorandum and the following documents publicly available free of charge from its website:

Draft third edition with all edits marked up
A comprehensive Edits List of all changes “made to the Code between the second and third editions”.
Draft “clean” third edition assuming all edits are accepted

To see the notice issued by the IPAA click HERE.

A gift of new insolvency legislation

Corporate Insolvency, Insolvency Law, Personal Bankruptcy, Regulation Comments Off

Jan 212013

Proposals for significant changes to Australia’s insolvency laws slipped out of the Government pipeline and into the public arena for comment just prior to Christmas.

According to the Government’s media release (19/12/2012):

the proposed laws aim at “reforming and modernising the way insolvency professionals are registered, disciplined and regulated”;
they will “improve regulatory oversight of the insolvency profession, improve value for money for recipients of insolvency services, and enhance creditor rights across all forms of insolvency administration (and in particular) provide greater powers for creditors to remove practitioners and curb excessive fees, and therefore deliver better outcomes for creditors, many of whom are small businesses”;
the laws are “an important element (in) the alignment of personal and corporate insolvency regulation in a number of key areas (and) seek to deliver greater consistency and less complexity for employees, creditors and practitioners, who all need to interact in the event of a personal or corporate insolvency”;
they show the Government is committed to “restoring the community’s confidence in the effective regulation, high professional standards, transparency and accountability of the insolvency profession following recent high profile cases of misconduct by corporate insolvency practitioners”.

The proposed laws are contained in the Insolvency Law Reform Bill 2012.

Interested parties have until 8 March 2013 to make a submission concerning the Bill.

The Exposure Draft of the Bill and the Explanatory Material are available for download from the webpage at http://www.treasury.gov.au/ConsultationsandReviews/Submissions/2012/Insolvency-Law-Reform-Bill

The address for submissions is also given at that webpage.

To see the full media release by the Government release click HERE.

A second tranche of the Bill – with consequential amendments to corporate and personal insolvency legislation as a result of the reforms, as well as transitional measures – is expected to be released soon.

………………………………………….. END ……………………………………..

“Australian Insolvency Decisions” August 2012 edition

Case Reports, Corporate Insolvency, court decisions, Insolvency Law, law reports, Personal Bankruptcy Comments Off

Sep 242012

Complied by Michael Ennis. Michael developed an interest in insolvency case law, while a Deputy Registrar in Bankruptcy at the Federal Court of Australia and while undertaking various roles at the Insolvency Trustee Service Australia (ITSA). He has maintained this interest since retiring. If you would like to receive the Insolvency Decisions schedule direct, advise Michael of additional decisions, or share your observations, you may contact Michael direct on rmci53mje@spin.net.au. Michael’s comments appear in red text.

Note: There is no July 2012 edition of Australian Insolvency Decisions.

Bankruptcy Act – following Date of Bankruptcy

Ambrose (Trustee) in the matter of Poumako (Bankrupt) v Poumako [2012] FCA 889 (21 August 2012) BANKRUPTCY – where transfer void against trustee in bankruptcy – property jointly owned by bankrupt and another person – appropriate orders in circumstances

BANKRUPTCY – where transfer void against trustee in bankruptcy – transferee paid part consideration – property subject to mortgage – mortgagee’s rights – mortgage funds used to pay part consideration – operation of s 120(4) regarding repayment of consideration paid by transferee

BANKRUPTCY – whether two transfers of property are void against the trustee in bankruptcy – undervalued transactions – transfer of residential properties by bankrupt to family members – whether the properties were held in trust – reliability of evidence – repayment of consideration paid http://www.austlii.edu.au/au/cases/cth/FCA/2012/889.html

Mulhern v Pearce [2012] FCA 884 (17 August 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/884.html

Maxwell-Smith v Donnelly [2012] FCAFC 82 (16 May 2012) http://www.austlii.edu.au/au/cases/cth/FCAFC/2012/82.html

Seems to be an important matter, providing review of s.179 – clearly a lot going on– Liprini v Pascoe as Trustee of the Bankrupt Estate of Liprini [2012] FCA 886 (16 August 2012) BANKRUPTCY – application for inquiry pursuant to s 179 Bankruptcy Act 1966 – threshold requirements for inquiry http://www.austlii.edu.au/au/cases/cth/FCA/2012/886.html

Freeman v National Australia Bank Limited [2012] FCA 866 (16 August 2012) PRACTICE AND PROCEDURE – vexatious litigant – application for extension of time for leave to appeal – application for leave to appeal against decision dismissing application to rescind vexatious litigant orders – order declaring vexatious litigant interlocutory not final – relevant principles in considering application for extension of time and for leave to appeal – reopening previous decision because of alleged fresh evidence – merits of case – whether primary judge had proper regard to issues raised by applicant – indemnity costs http://www.austlii.edu.au/au/cases/cth/FCA/2012/866.html

Interesting reading – looking forward to future hearings – National Australia Bank Limited v Moore [2012] FCA 865 (15 August 2012) BANKRUPTCY AND INSOLVENCY – bank seeking leave pursuant to s 58(3)(b) of the Bankruptcy Act 1966 to take fresh steps in, and to continue with, proceedings in the Supreme Court of New South Wales http://www.austlii.edu.au/au/cases/cth/FCA/2012/865.html

Rose v Meriton Apartments Pty Limited [2012] FCA 844 (13 August 2012) BANKRUPTCY AND INSOLVENCY – discretion to make sequestration order – whether discretion miscarried – whether leave should be granted to amend notice of appeal http://www.austlii.edu.au/au/cases/cth/FCA/2012/844.html

Frost v Bovaird [2012] FCA 831 (10 August 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/831.html

Rahman v Dubs [2012] FCA 849 (9 August 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/849.html

Corporations – pre-appointment

Valuestream Investment Management Ltd v Richmond Management Pty Ltd [2012] FCA 898 (22 August 2012) CORPORATIONS – urgent ex parte interlocutory application for the appointment of an interim receiver and manager – managed investment scheme – whether circumstances justified appointment of a receiver and manager – prima facie evidence that the trustee company no longer had director resident in Australia or registered office – prima facie evidence that the trustee company had made improper investments, failed to keep accounting records, appoint an auditor and report to unit holders http://www.austlii.edu.au/au/cases/cth/FCA/2012/898.html

Valeba Pty Ltd v Deputy Commissioner of Taxation [2012] QSC 200 (2 August 2012) STATUTORY DEMAND – SETTING ASIDE – DEMAND SERVED BY DEPUTY COMMISSIONER OF TAXATION – CONCLUSIVITY PROVISIONS OF TAXATION LEGISLATION – GENUINE DISPUTE – OTHER REASON TO SET ASIDE http://www.austlii.edu.au/au/cases/qld/QSC/2012/200.html

Corporations – post appointment

Warner v Hung, in the matter of Bellpac Pty Limited (Receivers and Managers Appointed) (In Liquidation) (No 3) [2012] FCA 819 (6 August 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/819.html

Robinson, in the matter of Darrell Lea Chocolate Shops Pty Ltd (Administrators Appointed) [2012] FCA 833 (3 August 2012) period for holding meeting extended http://www.austlii.edu.au/au/cases/cth/FCA/2012/833.html

Shannon (in his capacity as receiver and manager of North East Wiradjuri Co Limited) v North East Wiradjuri Co Limited (No 4) [2012] FCA 836 (2 August 2012) Fees fixed http://www.austlii.edu.au/au/cases/cth/FCA/2012/836.html

WARWICK ENTERTAINMENT CENTRE PTY LTD (RECEIVERS AND MANAGERS APPOINTED) atf THE WARWICK ENTERTAINMENT CENTRE UNIT TRUST -v- SILKCHIME PTY LTD (RECEIVERS AND MANAGERS APPOINTED) atf THE SILKCHIME UNIT TRUST [No 2] [2012] WASC 275 (1 August 2012) Companies – Payment by one company to another in group – Existence of debt – Evidence of Joint Venture Agreement – Interest payments
Evidence – Corporations Act s 1305 – Books kept – Admissible
Directors’ duties – Corporations Act s 181 – Breaches of statutory duties http://www.austlii.edu.au/au/cases/wa/WASC/2012/275.html

Gannell v Seaquest Pleasure Boats Pty Ltd (In Liquidation) [2012] VCC 893 (26 July 2012) CATCHWORDS – Personal injury claim – negligence of boat builder – breach of contract of sale of boat – assessment of damages for pain and suffering and pecuniary loss http://www.austlii.edu.au/au/cases/vic/VCC/2012/893.html

VCC & the QDC! – seldom, if ever see insolvency matters in this jurisdiction – Andrew Fielding as Liquidator of Lyngray Developments Pty Ltd v Dushas & Anor [2012] QDC 96 (11 May 2012) Corporations – external administration – voidable transactions – uncommercial transactions http://www.austlii.edu.au/au/cases/qld/QDC/2012/96.html

Vouris and Tonks as Deed Administrators Of Good Impressions Offset Printers Pty Limited (ACN 002 306 587) [2012] NSWSC 603 (30 May 2012) CORPORATIONS – Deed of company arrangement – Corporations Act 2001, 444DA – employees – employees not given priority by deed – employee creditors consent to deed – circumstances in which court will approve non-inclusion of provision under 444DA – whether approval can be given after execution of deed http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/603.html

Inglewood Farms Pty Ltd v AM No. 1 Pty Ltd (administrators appointed) (No 2) [2012] NSWSC 591 (29 May 2012) CORPORATIONS – Winding up – Corporations Act 2001 s 440A(2) – Application for the adjournment of winding up application – Relevant factors as to whether application should be adjourned – Whether requirements satisfied http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/591.html

Moodie, in the matter of Gowinta Farms Pty Ltd (administrators appointed) [2012] FCA 578 (31 May 2012) CORPORATIONS – extension of time to convene a second meeting of creditors of company in administration http://www.austlii.edu.au/au/cases/cth/FCA/2012/578.html

Miscellaneous

Lowe v Pascoe (No 2) [2012] NSWSC 885 (3 August 2012) Cash payments journals and expert report in relation to them admitted as evidence in fresh trial http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/885.html

Appoint of a Receiver and Manager of the partnership businesses – Lowe v Pascoe [2010] NSWSC 388 (7 May 2010) Existence of partnership Unusual signed partnership agreement Family patriarch conducting partnership business (or businesses) as if it (they) was (were) his own and controlling all aspects Numerous disputed questions of fact and law and subsidiary issues
Substantial cash businesses (grocery and butchery) Non-disclosure of full partnership income to ATO
Evasion of tax – plus – http://www.austlii.edu.au/au/cases/nsw/NSWSC/2010/388.html

END OF POST.

“Australian Insolvency Decisions” June 2012 edition

Case Reports, Corporate Insolvency, court decisions, Insolvency Law, Insolvency practices, law reports, Personal Bankruptcy Comments Off

Aug 062012

____________________________________________________________________________________

Bankruptcy Act – Prior to Date of Bankruptcy

Commonwealth Bank of Australia v Oswal [2012] FCA 772 (12 July 2012) BANKRUTPCY – debtor resident outside of Australia – substituted service of bankruptcy notice – service upon solicitors who are representing or have represented the debtor in other proceedings in Australia – whether leave to serve a bankruptcy notice out of Australia is required http://www.austlii.edu.au/au/cases/cth/FCA/2012/772.html

Westpac Banking Corporation v Cossar & Anor [2012] FMCA 602 (10 July 2012) BANKRUPTCY – Creditor’s Petition – whether respondent debtors’ proposed proceeding against supporting creditor warrants adjournment or constitutes other sufficient cause not to make a sequestration order – whether sufficient evidence that proposed proceedings will proceed without undue delay and are likely to be successful – this criteria not established on evidence before Court – sequestration order made http://www.austlii.edu.au/au/cases/cth/FMCA/2012/602.html

Rookharp Pty Ltd & Anor v Webb & Anor [2012] FMCA 607 (5 July 2012) BANKRUPTCY – Creditor’s petition – no appearance of debtors at hearing – no grounds of opposition – sequestration order made http://www.austlii.edu.au/au/cases/cth/FMCA/2012/607.html

Bankruptcy Act – following Date of Bankruptcy

Quickly & thoroughly review all estates transferred from another Trustee – Newman v Bain [2012] FMCA 629 (5 July 2012) BANKRUPTCY – Application for extension of time for election by trustee pursuant to s.60(3) of the Bankruptcy Act – matters relevant to exercise of discretion http://www.austlii.edu.au/au/cases/cth/FMCA/2012/629.html

One with the lot – Cooper v Mbuzi [2012] QSC 190 (17 July 2012) PROCEDURE – MISCELLANEOUS PROCEDURAL MATTERS – VEXATIOUS LITIGANTS AND PROCEEDINGS – where the respondent in this matter has had a vexatious proceeding order made against him– where the applicant in this matter is the respondent in a matter commenced by the current respondent before the vexatious proceeding order was made against the current respondent – whether the applicant should be granted leave to be added to the earlier vexatious litigant proceedings – whether the earlier order under the Vexatious Proceedings Act 2005 should be amended to stay the other proceeding brought by the respondent http://www.austlii.edu.au/au/cases/qld/QSC/2012/190.html

Bankruptcy was annulled 9 months after Sequestration Order made, but action continues – Phillip Segal & Anor v Max Christopher Donnelly & Ors [2012] NSWSC 833 (24 July 2012) Whether solicitor authorised by registered proprietors of property to conduct sale process on their behalf – whether emails between solicitor and plaintiffs evidence an intention to enter into binding contract – where one co-owner acted as agent for the purchasers – whether other co-owner entitled to reject offer made by plaintiffs for purchase of the Property http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/833.html

Maxwell-Smith v Hall & Anor [2012] NSWCA 205 (25 June 2012) PRACTICE AND PROCEDURE – application for pro bono assistance under UCPR 7.36 – where litigant had received assistance under a previous referral twice within preceding three years – determining whether interests of justice are in the applicant’s favour requires assessment of whether the appeal has reasonable prospects of success – prospects of success found to be insufficient – application refused
PRACTICE AND PROCEDURE – power to waive, postpone and remit fees under Civil Procedure Regulation 2005 reg 11 – power to be exercised by Registrar on separate application http://www.austlii.edu.au/au/cases/nsw/NSWCA/2012/205.html

Same mistake still being made!! – “…a search by an officer of the Deputy Commissioner in April 2012 did not reveal the 2010 Order because the search was made by entering only the first name and surname of Mr Russell which, due to the form of that search, did not reveal the 2010 Order” – Deputy Commissioner of Taxation v Russell [2012] FMCA 598 (9 July 2012) BANKRUPTCY – Annulment – whether second sequestration order ought to have been made http://www.austlii.edu.au/au/cases/cth/FMCA/2012/598.html

Unusual circumstance in which this application considered – it occurred during the transfer of the bankruptcy administration to a registered trustee in bankruptcy pursuant to s 181A of the Bankruptcy Act 1966 – given outcome of the FMCA matter above, should in-coming Trustee be ‘engaged’ by ITSA to manage the administration, till transfer confirmed? – Leader Computers Pty Ltd v Johnson [2012] FCA 716 (6 July 2012) BANKRUPTCY AND INSOLVENCY – application pursuant to s 58(3)(b) of Bankruptcy Act 1966 (Cth) for leave to proceed in actions in the District Court of South Australia against bankrupt for voidance of transfer of property – whether leave should be granted in absence of indication from trustee in bankruptcy as to whether application opposed – where urgency in leave being granted due to impending trial date for District Court actions. Held: It was appropriate to grant leave pursuant to s 58(3)(b) of the Act. http://www.austlii.edu.au/au/cases/cth/FCA/2012/716.html

Re s. 153B – Stewart v Grauby [2012] FCA 703 (2 July 2012) BANKRUPTCY AND INSOLVENCY – application under r 36.05 of the Federal Court Rules 2011 to extend time to appeal – order from Federal Magistrates Court of Australia dismissing application for annulment – whether time should be extended http://www.austlii.edu.au/au/cases/cth/FCA/2012/703.html

Sullivan v Macquarie Leasing Pty Ltd [2012] FMCA 601 (2 July 2012) BANKRUPTCY – Application to set aside substituted service orders and sequestration order of Registrars of the Federal Magistrates Court – where applicant concedes debts owed – where applicant provides no evidence of ability to repay debts – where applicant claims unaware of papers relating to bankruptcy – whether to set aside orders http://www.austlii.edu.au/au/cases/cth/FMCA/2012/601.html

The end (perhaps) of an interesting, long running series of hearings in this bankruptcy – Sheahan (Trustee) in the matter of Frost (Bankrupt) v Frost (No 4) [2012] FCA 708 (29 June 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/708.html

One of two significant decision Bob referred to me – as Bob remarked: “The judgment at paras 143-145, succinctly details the operation of s.58(1)(b) & (6) and s.116(1) of the Bankruptcy Act, and confirms that unrealised divisible property remains vested in the bankrupt estate notwithstanding that the bankrupt has been discharged from bankruptcy” – Falloon v Madden; Madden v Madden [2012] NSWSC 652 (14 June 2012) TRUSTS – sole proprietor – resulting trust – beneficiary bankrupt at the time – joint tenants or tenants in common – payments for benefit deceased estate – occupation fee http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/652.html

The 2^nd from Bob – again I will include Bob’s worthy comment “So I would submit that the lesson to be learnt from this judgment is that when you are fully engaged in investigating a “suspect” transaction with a view to recovery a property etc, from time to time stand back and ask the question “ Is the investigation/legal action still going to bring money into the estate ?”” – Travaglini v Raccuia [2012] FCA 620 (14 June 2012) COSTS – application for leave to discontinue with no order as to costs – application of r 26.12(7) of the Federal Court Rules 2011 that the discontinuing party is liable for costs unless the Court is satisfied there is a good reason for ordering otherwise – whether parties acted reasonably in prosecuting and defending the proceeding Held: when applicant commenced proceeding there was a reasonably foreseeable risk that litigation would become futile – applicant should pay the respondents’ costs upon discontinuance http://www.austlii.edu.au/au/cases/cth/FCA/2012/620.html

Tarrant v Statewide Secured Investments Pty Ltd [2012] FCA 582 (6 June 2012) BANKRUPTCY – Appeal from sequestration order – where federal magistrate refused to adjourn creditor’s petition – federal magistrate allowed the creditor’s petition to be amended to correct judgment date and dispensed with service of the amended petition – federal magistrate refused to receive bankrupt’s evidence where bankrupt required for cross-examination on her affidavits but did not attend – whether grounds of appeal disclose any appealable error http://www.austlii.edu.au/au/cases/cth/FCA/2012/582.html

A ‘must read’ – the circumstances in which a S of A could be rejected by ITSA has not been considered by the Court as far as I’m aware – I wonder where these Orders would put the Offence provisions, if the answers are not answered accurately – Vince (Trustee), in the matter of Sopikiotis (Bankrupt) v Sopikiotis [2012] FCA 573 (1 June 2012) BANKRUPTCY – s 54(1) Bankruptcy Act 1966 (Cth) – whether document purporting to be a statement of affairs defective – whether bankrupt should be required to file a statement of affairs – order made http://www.austlii.edu.au/au/cases/cth/FCA/2012/573.html

Another matter deserving a good read & consideration – Weeden v Rambaldi [2012] FCA 552 (29 May 2012) BANKRUPTCY – whether notices of objection to discharge filed pursuant to s 149B of the Bankruptcy Act 1966 (Cth) valid – whether notices of contribution assessment made pursuant to s 139(1)(c) of the Bankruptcy Act valid – whether notices were invalid because made by a joint trustee acting alone – unanimous concurrence required for act of joint trustee – whether joint trustees were appointed or a sole trustee appointed by meeting of creditors – s 257 of Bankruptcy Act and presumption that minutes of meeting provide prima facie evidence of meeting – whether evidence of concurrence of joint trustees – whether s 306(1) of the Bankruptcy Act validates the act of a joint trustee acting alone, where the consent of other trustee is later given, in relation to the making and notification of an assessment pursuant to s 139W(1) of the Bankruptcy Act and in relation to the filing of an objection to discharge pursuant to s 149B of the Bankruptcy Act – whether a formal defect or irregularity within the meaning of s 306(1) http://www.austlii.edu.au/au/cases/cth/FCA/2012/552.html

I’m not quite sure what is going on here – also, the plaintiff, joint trustees, use subpoena rather that s. 77C Notice – Re estate of Mischel [2012] VSC 296 (13 June 2012) PRACTICE AND PROCEDURE – Objection to a subpoena – Whether the Commissioner has power to release documents pursuant to the Taxation Administration Act 1997 (Vic) – Sections 91, 93, 94, 95 considered http://www.austlii.edu.au/au/cases/vic/VSC/2012/296.html

Corporations – pre-appointment

TRINH OPTICAL YLLUSION PTY LTD v VAN [2012] SASC 125 (25 July 2012) Application to set aside a statutory demand – amount due under a trust – whether a debt for the purposes of the Corporations Act 2001 – creditor/beneficiary an eight year-old boy – statutory demand served on the instructions of his mother – whether mother had authority to do so http://www.austlii.edu.au/au/cases/sa/SASC/2012/125.html

Williams (as liquidator of Willahra Pty Ltd (in liq)) v Kim Management Pty Ltd [2012] QSC 143 (19 June 2012) CORPORATIONS – WINDING UP – CONDUCT AND INCIDENTS OF WINDING UP – LIQUIDATORS – where an application was made to set aside an order made pursuant to s 588FF(3)(b) of the Corporations Act – whether an order should be set aside as of right because a party affected by the order made was not given an opportunity to be heard on the s 588FF(3)(b) application – circumstances in which a shelf order can be made on an ex parte basis – where the plaintiff liquidator did not know that the defendant was a potential target of an application under s 588FF(1) – whether the plaintiff liquidator ought to have known that the defendant was a potential target of an application under s 588FF(1) and served the defendant – the standard expected of a party and its lawyers on an ex parte application – the duty to make proper inquiries before making an ex parte application http://www.austlii.edu.au/au/cases/qld/QSC/2012/143.html

GMW Group Pty Ltd (Receivers and Managers Appointed) (in liquidation) & ors v Michael Saadie in his own right and trading as GMW1 & ors [2012] QSC 140 (4 June 2012) PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS – DEFAULT OF PLEADING – where the applicants apply for summary judgement against the respondents under r 374 of the Uniform Civil Procedure Rules 1999 – where the proceeding was commenced by originating application and pleadings were later ordered – where service and timing of service of the statement of claim on the second and third respondents within the required period is unclear – where the first respondent has filed a defence and the second and third respondents have filed no defence – where the respondents have not complied with a court order requiring them to file affidavits detailing their personal assets – whether the applicants have satisfactorily proven that the respondents have failed to take a step in the proceeding thus warranting summary judgment under r 374 http://www.austlii.edu.au/au/cases/qld/QSC/2012/140.html

Applicant became bankrupt subsequent to initial application – McElligott v Boyce & Ors [2012] QSC 189 (17 July 2012) PROCEDURE – JUDGMENTS AND ORDERS – AMENDING, VARYING AND SETTING ASIDE – where applicant seeks to set aside under r 667(2) of the Uniform Civil Procedure Rules an earlier order of the court for the winding up of a company on the basis of allegations of fraud – where earlier appeals against winding up order were dismissed – where the allegation of fraud was considered in the appeal – where the applicant is a bankrupt – whether the applicant has standing to bring the application – whether the applicant’s contentions are based on newly-discovered material http://www.austlii.edu.au/au/cases/qld/QSC/2012/189.html

Field Camp Services Pty Ltd v Green (No.3) [2012] FMCA 577 (6 July 2012) CONSUMER PROTECTION – Alleged misleading and deceptive conduct – hire of transportable accommodation and camp units. PRACTICE AND PROCEDURE – Failure to pay costs of earlier proceedings in other courts – statutory demand made – whether application to be dismissed or permanently stayed. COSTS – Failure to pay costs of earlier proceedings in this court and State courts – statutory demand made – whether application to be dismissed or permanently stayed http://www.austlii.edu.au/au/cases/cth/FMCA/2012/577.html

Deputy Commissioner of Taxation v Compumark Pty Ltd [2012] FCA 583 (5 June 2012) CORPORATIONS – application to wind up company in insolvency by reason of tax debt – court’s residual discretion in applications for winding up – test for reasonably arguable case to challenge the existence of a tax debt PRACTICE AND PROCEDURE – corporate respondent – leave to appear otherwise than by a lawyer – dispensing with r 4.01(2) of the Federal Court Rules 2011
EVIDENCE – “fullest and best” evidence principles http://www.austlii.edu.au/au/cases/cth/FCA/2012/583.html

Corporations – post appointment

Handberg & Anor v MIG Property Services Pty Ltd [2012] VSCA 126 (15 June 2012) PRACTICE AND PROCEDURE – Application for leave to appeal – Whether substantial injustice demonstrated http://www.austlii.edu.au/au/cases/vic/VSCA/2012/126.html

Mischel v Mischel Holdings Pty Ltd (in liq) [2012] VSC 292 (27 July 2012) CO-OWNERSHIP – Joint tenancy at law – whether tenancy in common in equity – whether consideration given for acquisition of share – severance of joint tenancy by agreement and by conduct – effect of death of joint tenant after exchange of contracts but before completion of sale of the subject land EQUITY – Maxims – Equity will not assist a volunteer http://www.austlii.edu.au/au/cases/vic/VSC/2012/292.html

Clarke & Ors v Great Southern Finance Pty Ltd & Ors [2012] VSC 312 (24 July 2012) COSTS – Privilege – Loss of privilege under s 124 Evidence Act 2008 (Vic) determined before trial – Plaintiffs successful. COSTS – Application by plaintiffs under s 1321 Corporations Act 2001 (Cth) to review decision of liquidators to assert joint privilege – application adjourned sine die without determination http://www.austlii.edu.au/au/cases/vic/VSC/2012/312.html

Clarke & Ors v Great Southern Finance Pty Ltd (in liq) & Ors (Ruling No 1) [2012] VSC 295 (29 June 2012) PRACTICE AND PROCEDURE – Application by Plaintiffs to amend statement of claim – whether proposed amendments are defective – whether prejudice is likely to be suffered if the application were to be allowed – application refused http://www.austlii.edu.au/au/cases/vic/VSC/2012/295.html

Re Traditional Values Management Ltd [2012] VSC 308 (19 July 2012) PRACTICE AND PROCEDURE – COSTS – Orders made without adjudication on the merits – Discussion of relevant principles – Costs order made http://www.austlii.edu.au/au/cases/vic/VSC/2012/308.html

Traditional Values Management Limited (in liq) v Taylor & Ors [2012] VSC 299 (10 July 2012) PRACTICE AND PROCEDURE – Consolidation of proceedings – Separate proceedings against directors and officers, auditors, accountants and unitholders in failed managed investment scheme – Supreme Court (General Civil Procedure) Rules 2005 (Vic), r 9.12 http://www.austlii.edu.au/au/cases/vic/VSC/2012/299.html

Hoddinott & Ors v Willmott Forests Limited (recs & liq apptd) (in liq) [2012] VSC 282 (27 June 2012) PRACTICE AND PROCEDURE – COSTS – Orders agreed without adjudication on the merits – Relevant principles for an award of costs in a compromised proceeding – Costs order made http://www.austlii.edu.au/au/cases/vic/VSC/2012/282.html

TNT Building Trades Pty Limited v Benelong Developments Pty Limited (administrators appointed) [2012] NSWSC 766 (9 July 2012) CORPORATIONS – Creditors’ meeting – Resolution of meeting – Corporations Act 2001 (Cth) s 600A(2)(a) – Application to set aside resolution of creditors’ meeting.
CORPORATIONS – Termination of deed of company arrangement – Whether deed should be terminated by Court – Interests of creditors of company as a whole – Whether winding up would allow more favourable outcome or better return to creditors than deed of company arrangement and whether deed of company arrangement would be contrary to the interests of or prejudicial to creditors as a whole http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/766.html

Fw: Napier Constructions Pty Ltd (Subject to DOCA)(Receivers & Managers Appointed) -v- Christopher Honey (in his capacity as Joint and Several Receiver and Manager of Napier Constructions Pty Ltd) [2012] NSWSC 762 (6 July 2012) CONTRACT – Construction of deed recording agreement as to the basis upon which a party would assist companies and their receivers in prosecuting proceedings against certain third parties – where another party (the bank) makes available funds to facilitate prosecution of proceedings and is owed money under secured facilities – construction of formula for the sharing of settlement proceeds (between the companies and the bank) where provision is capable of two meanings – construction of clauses providing for the taking into account of interest http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/762.html

St Hilliers Construction Pty Ltd (In Administration) -v- Fitzpatrick Investments Pty Ltd [2012] NSWSC 804 (2 July 2012) BUILDING AND CONSTRUCTION – where design and construct building contract requires provision by the contractor of bank guarantees as security for performance – where, upon satisfaction of certain conditions, the contractor is entitled to a reduction of the security – whether such conditions satisfied – whether, by taking possession of the works, the principal has exercised an election amounting to a waiver of its right to continue to keep the security http://www.austlii.edu.au/au/cases/nsw/NSWSC/2012/804.html

Management 3 Group Pty Ltd (In Liq) v Lenny’s Commercial Kitchens Pty Ltd (No 2) [2012] FCAFC 92 (25 June 2012) PRACTICE AND PROCEDURE – pre-judgment interest – date from which interest is to run – interest to run until judgment is entered – rate at which interest accrues – whether penalty interest rate or Reserve Bank of Australia cash rate plus 4% – Practice Note CM16 Pre-judgment Interest – Federal Court of Australia Act 1976 (Cth), ss 51A, 52 http://www.austlii.edu.au/au/cases/cth/FCAFC/2012/92.html

In the matter of KASH Aboriginal Corporation ICN 108 (Administrators Appointed) No 2 [2012] FCA 789 (27 July 2012) CORPORATIONS – Aboriginal Corporation – administrators seeking directions in respect of proposed loan and mortgage with associated entity – whether administrators personally liable for monies borrowed – potential liability of administrators in respect of workplace health and safety issues – proposal to borrow funds from related entity http://www.austlii.edu.au/au/cases/cth/FCA/2012/789.html

Roumanus v Orchard Holdings (NSW) Pty Limited (In Liq) [2012] FCA 775 (20 July 2012) CORPORATIONS –Whether the defendant corporation in liquidation should be held liable as the primary contravenor or, alternatively, as an accessory, in respect of misleading and deceptive conduct constituted by representations made by persons who occupied office as directors of the corporation in connection with the sale by one of those persons to others of shares in the corporation – whether causes of action out-of-time in any event – whether causes of action could be maintained pursuant to ss 52, 75B and 82 of the Trade rPractices Act 1974 (Cth) http://www.austlii.edu.au/au/cases/cth/FCA/2012/775.html

Australian Securities and Investments Commission v Storm Financial Limited (Receivers and Managers Appointed) (in liq) [2012] FCA 750 (16 July 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/750.html

Australian Competition and Consumer Commission v ACN 135 183 372 (in liquidation) (formerly known as Energy Watch Pty Ltd) [2012] FCA 749 (13 July 2012) CONSUMER LAW – declaratory relief, penalties and costs – breach of ss 18(1), 29(1)(g) and 34 of the Australian Consumer Law, Schedule 2 to the Competition and Consumer Act 2010 (Cth) – misleading and deceptive conduct – false and misleading representations – in trade or commerce – multimedia mass advertising campaign – retail energy prices – energy brokering services – general and specific deterrence – consumer protection http://www.austlii.edu.au/au/cases/cth/FCA/2012/749.html

Carson, in the matter of Hastie Group Limited (No 3) [2012] FCA 719 (5 July 2012) CORPORATIONS – application for directions under s 447D of the Corporations Act 2001 (Cth) http://www.austlii.edu.au/au/cases/cth/FCA/2012/719.html

Australian Executor Trustees Ltd v Provident Capital Ltd (No 2) [2012] FCA 754 (3 July 2012) PRACTICE AND PROCEDURE – stay – principles applying to grant of a stay http://www.austlii.edu.au/au/cases/cth/FCA/2012/754.html

Smith in the matter of Actively Zoned Pty Ltd (in liq) [2012] FCA 605 (8 June 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/605.html

Quikfund (Australia) Pty Ltd v Prosperity Group International Pty Limited (In Liquidation) [2012] FCA 603 (7 June 2012) CORPORATIONS – consideration of an application for leave to proceed to prosecute an appeal http://www.austlii.edu.au/au/cases/cth/FCA/2012/603.html

Hancock, in the matter of St Hilliers Construction Pty Limited (administrators appointed) [2012] FCA 602 (7 June 2012) CORPORATIONS – extension of time to convene a second meeting of creditors of a company in administration http://www.austlii.edu.au/au/cases/cth/FCA/2012/602.html

Burrup Fertilisers Pty Ltd (Receivers and Managers Appointed) v Oswal (No 6) [2012] FCA 590 (7 June 2012) COSTS – security for costs application – compliance with a subpoena – whether the Court is empowered under the Federal Court Rules 2011 to award security for costs in advance for costs and expenses of a non-party who is subpoenaed by a party Held: a stranger to litigation should not be put to onerous expense in complying with a subpoena issued by a party not resident in the jurisdiction – that quantum of security should be reviewed and fixed by a Registrar http://www.austlii.edu.au/au/cases/cth/FCA/2012/590.html

Australian Competition and Consumer Commission v ACN 135 183 372 (Administrators Appointed) (formerly known as Energy Watch Pty Ltd) [2012] FCA 586 (1 June 2012) http://www.austlii.edu.au/au/cases/cth/FCA/2012/586.html

An on-going matter – looking forward to seeing where it all ends up – MG Corrosion Consultants Pty Ltd v Gilmour [2012] FCA 568 (31 May 2012) CORPORATIONS – variation to freezing order http://www.austlii.edu.au/au/cases/cth/FCA/2012/568.html

Insolvency practitioners cleared to provide tax and BAS agent services

BAS, Corporate Insolvency, Insolvency practices, Personal Bankruptcy, Returns, Taxation Issues Comments Off

Jul 202012

Liquidators who provide a tax agent or BAS service to the company they are administering do not have to be registered as tax agents or BAS agents.

That is the ruling issued by the Tax Practitioners Board on 26 June 2012 in its Information Sheet TPB(1) 12/2012.

The same rule applies to most other types of insolvency practitioners appointed under the Corporations Act or the Bankruptcy Act.

CONDITIONS APPLY:

But the rule, or exemption, only applies to work done for the client after the insolvency practitioner’s appointment. During the pre-appointment period the ban on unregistered persons providing a tax agent service or a BAS service for a fee or reward will apply.

The insolvency practitioners exempted under the ruling are liquidators, provisional liquidators, company administrators, administrators of deeds of company arrangement, receivers, receivers and managers, and bankruptcy trustees.

But the exemption might not apply to insolvency practitioners who act as agents for mortgagees in possession. On one reading of the Information Sheet it seems that because such insolvency practitioners are not agents of the company (as are liquidators, administrators and receivers) then they might not be performing the tax/BAS agent services “in accordance with the duties and responsibilities of the insolvency practitioner under the terms of the relevant legislation” in a situation “analogous to that of a self-preparing entity”. (See paras. 20 and 21.)

The Information Sheet also addresses the situation where, during the post-appointment period, an insolvency practitioner “bring(s) in outside consultants such as accountants or bookkeepers to deal with the entity’s tax or BAS issues”. The Tax Practitioners Board says that such consultants would need to be registered.

In other words, the exemption only applies where the insolvency practitioners or his or her employees carry out the tax work.

To see the TPB Information Sheet CLICK HERE.

Older Entries Newer Entries