Liquidations
Liquidation involves the appointment of an independent insolvency professional (a liquidator) to take over the management of a debtor company.
The goals of corporate insolvency involve:
- Independent control of company property
- Investigations
- Reporting to stakeholders
- Payment of creditors
The experience leading to the appointment of a liquidator can be a long and stressful process, which does not necessarily end with the appointment of a liquidator. Oftentimes, liquidators will take action against directors to recover property, or take legal action to recover property and funds which can then be used to pay creditors. For this reason, we recommend that directors obtain legal and/or accounting advice prior to the appointment of a liquidator. There are often steps which can be taken, prior to the appointment of a liquidator, which can minimise or eliminate legal problems arising after a liquidator is appointed.
Legal action by liquidators against company directors and other parties can involve claims for:
- Return of company property, including ‘loan accounts’ which exist on the books at the time of liquidation
- Breach of director duties
- Insolvent trading
- Insolvent transactions such as unfair preference payments and uncommercial transactions
- Unfair loans
- Unreasonable director-related transactions
- Creditor-defeating dispositions, or claims against persons for facilitating a creditor-defeating disposition
- Aiding and abetting, or being knowingly concerned with breaches of the Corporations Act 2001 (Cth)
- Public examinations
Our lawyers have extensive experience across all facets of insolvency law. While we predominantly act for insolvency practitioners, we also accept instructions from business owners seeking guidance or representation through insolvency processes.
Contact Gear & Co to find out how we can assist you.