Situations can arise where a payment is made by one party to another party by mistake. This occurs, for example, where a debtor makes a payment to the incorrect entity within a group of companies, a bank remits funds to the account of an unintended recipient, or a finance company makes payment to a supplier of equipment based upon forged invoices. (more…)
It is very common for a small business to be operated by a company with just one director/shareholder. Business owners can easily get caught up in the myriad of tasks that face them on a daily basis. However, sole directors should take a moment to consider what will happen to their company upon their death. (more…)
Once a company has been placed into liquidation, the appointed liquidator is required, pursuant to the Corporations Act 2001 (Cth), to investigate and realise (recover) assets of the company for distribution to unsecured creditors (i.e. persons/companies owed money by the company in liquidation). (more…)
When is a holding company liable for the debts incurred by its subsidiary company?
Holding or parent companies control the shares of other companies, being subsidiary companies. These holding companies can be liable for the debts incurred by their subsidiary companies, without having been involved in the transaction that incurred the debt. (more…)
The judgment of Independent Contractor Services (Aust) Pty Limited ACN 119 186 971 (in liquidation) (No 2)  NSWSC 106, delivered on 23 February 2016, held that a liquidator appointed to a company, which acts solely as the corporate trustee of a trust, must:
1. approach the Court to obtain approval of the liquidator’s remuneration and the liquidator’s disbursements (which the liquidator has a right of indemnity for in priority to trust creditor claims); and
2. distribute trust assets to creditors equally, including employee claims, with no special priority as set out in the statutory order of priority codified by section 556 of the Corporations Act 2001 (Cth).
A Garnishee Order is a form of enforcement action that can be used for the recovery of a court-ordered judgment debt. It can be served on a third party who owes monies to the debtor, directing that the third party pay that money to the entity that issued the Garnishee Notice, rather than the debtor.