In an article published in the ARITA Journal, ABL senior associate Stephen Lloyd explains the obligations imposed on receivers by s 433 of the Corporations Act.
To summarise:
- The Commonwealth Department of Jobs and Small Business’s increased scrutiny of receivers’ compliance with s 433 of the Corporations Act 2001 (Cth) makes it essential for receivers to understand their obligations in relation to paying the proceeds of circulating assets to priority creditors.
- Section 433 imposes a personal and positive obligation on receivers which can be directly enforced by priority creditors, including the Commonwealth in circumstances where the Commonwealth has paid employee entitlements in accordance with the FEG scheme.
- Receivers therefore need to be careful to identify circulating assets and to ensure that they keep proper records of the costs and expenses associated with realising circulating assets.
Receivers, Circulating Assets & Employees as Priority Creditors was published in the June 2018 edition of the ARITA (Australian Restructuring Insolvency & Turnaround Association) Journal.
Click here to read the article.
