Journal article
The Effect of Bankruptcy and Liquidation on Trust Property: Recent High Court Judgments and Implications for Insolvency Practitioners and "Post-Appointment" Dealings and Dispositions
Insolvency law journal, Vol.28(1), pp.29-40
03/2020
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Abstract
Two recent judgments of the High Court of Australia have confirmed a tension between the legal effect of liquidation and bankruptcy on trust property and the duty of liquidators and trustees-in-bankruptcy to secure an insolvent's property upon their appointment. Recent case law demonstrates that insolvency practitioners are in a difficult position when there is doubt as to whether property legally owned by an insolvent is in fact held on trust. Prudence demands that a liquidator or trustee-in-bankruptcy secure property to which the insolvent holds legal title before assessing claims of an asserted beneficial owner. However, the High Court has confirmed that "mere" legal title in trust property will not vest in a trustee-in-bankruptcy under s 58 of the Bankruptcy Act 1966 (Cth) and now it is doubtful whether s 468 of the Corporations Act 2001 (Cth) will always void a disposition of trust property after the commencement of a winding up.
Details
- Title
- The Effect of Bankruptcy and Liquidation on Trust Property: Recent High Court Judgments and Implications for Insolvency Practitioners and "Post-Appointment" Dealings and Dispositions
- Creators
- Mark Wellard (Author) - University of Technology Sydney
- Publication Details
- Insolvency law journal, Vol.28(1), pp.29-40
- Publisher
- Lawbook Co Ltd
- Number of pages
- 12
- Identifiers
- 991013227010002368
- Academic Unit
- Faculty of Business, Law and Arts
- Language
- English
- Resource Type
- Journal article