Licensing of insolvency practitioners – decision making principles from New Zealand

Mr Damien Grant has succeeded before the High Court of New Zealand in challenging a decision of RITANZ declining to admit him as a member, and thereby denying him the right to practise as an insolvency practitioner under New Zealand’s new insolvency practitioner licensing regime.  This was in the context of whether Grant was of […]

Caution against “reasoning backwards” in assessing the validity of liquidators’ litigation

A judge has cautioned against “reasoning backwards” to assume that insolvency practitioners’ failed or injudicious legal proceedings either should not reasonably have been commenced or continued, noting that the conduct of litigation often involves difficult strategic decisions, the outcomes of which are notoriously difficult to predict. ASIC’s claim that the liquidator had breached his duties […]

Duties of directors of insolvent companies – New Zealand Supreme Court decision

The NZ Supreme Court has given a significant decision on the duties of directors in the face of their company’s financial difficulties. Comparison is made by the NZ government with Australia’s insolvent trading law; a decision in Mainzeal is pending; and there is a proposal for a NZ safe harbour.   When Australia was considering […]

A 2012 committee of creditors found in 2020 to be invalidly appointed

In May 2012 a national Australian transportation company was put into liquidation and on 2 July, a meeting of creditors was held which purported to appoint a committee of inspection (creditors) and specify the members of the COI.  ‘Purported’ because over 8 years later, the appointment of the committee has been found to be invalid: […]

A “private arrangement” between a liquidator and the Tax Commissioner

The Commissioner of Taxation has purchased a litigation claim from a liquidator, on what terms we are not permitted to know. One of the reforms introduced in Australian in 2017 was to allow liquidators and trustees to assign causes of action to a third party, including a creditor, for value: s 100-5 Schedules.  The idea […]

Bankruptcy and family provision claims

In Bankrupt for Life, concerning the way a person can remain bankrupt for ever in Australia if they never file their statement of affairs (SOA), I referred to the case of a Mr Talent, who was made bankrupt in May 2000 but who had only filed his statement of affairs over 20 years later, in […]

Courts ‘should be wary of [liquidator] disclaimers where environmental liabilities are to be passed onto taxpayers or innocent persons’

A court has set aside liquidators’ disclaimer of contaminated property on a challenge by the environmental regulator. Particularly in a voluntary liquidation of a company, the Court said it should discourage the use of that process as a means to avoid the company’s environmental responsibilities. Ultimately however, environmental responsibilities are better enforced earlier, than at […]