Property developers – do you really need to batten down the hatches?

Last Wednesday we held the first event in our relaunched Restructuring and Insolvency Forum. 

A few days before the forum the Reserve Bank of Australia warned that the massive number of new apartment blocks approaching completion could send developers broke and leave the banks nursing big losses.  The day after the forum, The Australian reported the findings of Morgan Stanley research which forecast a credit crunch and a hard landing for the new apartment construction cycle with a surplus of 100,000 apartments by 2018.  The investment bank predicts a 'sudden stop' of apartment activity, triggered by regulator-driven rationing of credit, which will cause the construction industry to shed some 200,000 jobs.

Will APR be Forge-ing ahead with its threatened action against Australia, or is it all a bit of hot air?

There have been recent reports that APR Energy PLC has threatened the Australian Government with a demand for $200 million in damages based on a claim under the Australia-United States Free Trade Agreement after it lost its security interest in multi-million dollar wind turbines it leased to an Australian company due to the operation of a provision in the Personal Property Securities Act 2009 (Cth) (PPSA).   

Model Law on Cross-Border Insolvency comes to the rescue for foreign representative seeking funds

On Friday 7 October 2016, McCullough Robertson successfully obtained orders on behalf of a US Chapter 7 bankruptcy trustee, requiring payment to her of money held by the Public Trustee of Queensland (Public Trustee) on behalf of a US bankrupt and her former husband.  As far as we know, this is the first time that the Model Law on Cross-Border Insolvency (Model Law) has been used in Australia to obtain an order allowing the repatriation of funds to a foreign representative that are not the foreign debtor’s assets.

To set-off or not to set-off in unfair preference claims?

Last year’s Queensland District Court decision in Morton v Rexel Electrical Supplies Pty Ltd [2015] QDC 49 (Rexel) caused quite a stir in insolvency circles.  In Rexel, Searles DCJ (a former partner of McCullough Robertson) found that section 553C of the Corporations Act 2001 (Cth) (Act) could apply to reduce an unfair preference claim brought by a liquidator, by allowing the amount still owing by the company to be set-off against the liquidator’s claim.