The Effect of Bankruptcy and Liquidation on Trust Property: Recent High Court Judgments and Implications for Insolvency Practitioners and Post-Appointment Dealings and Dispositions

Wellard, M

The Effect of Bankruptcy and Liquidation on Trust Property: Recent High Court Judgments and Implications for Insolvency Practitioners and Post-Appointment Dealings and Dispositions

Wellard, M

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Publisher:: Thomson Reuters
Publication Type:: Journal Article
Citation:: Insolvency Law Journal, 2020, 28, (1), pp. 29-40
Issue Date:: 2020-07-01

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Field	Value	Language
dc.contributor.author	Wellard, M https://orcid.org/0000-0003-3784-2079
dc.date.accessioned	2020-07-17T12:15:52Z
dc.date.available	2020-04-02
dc.date.available	2020-07-17T12:15:52Z
dc.date.issued	2020-07-01
dc.identifier.citation	Insolvency Law Journal, 2020, 28, (1), pp. 29-40
dc.identifier.issn	1039-3293
dc.identifier.uri	http://hdl.handle.net/10453/141792
dc.description.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.
dc.language	en
dc.publisher	Thomson Reuters
dc.relation.ispartof	Insolvency Law Journal
dc.rights	info:eu-repo/semantics/closedAccess
dc.subject	1501 Accounting, Auditing and Accountability, 1801 Law
dc.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
dc.type	Journal Article
utslib.citation.volume	28
utslib.location.activity	Australia
utslib.for	1501 Accounting, Auditing and Accountability
utslib.for	1801 Law
pubs.organisational-group	/University of Technology Sydney/Faculty of Law
pubs.organisational-group	/University of Technology Sydney
utslib.copyright.status	closed_access	*
pubs.consider-herdc	true
dc.date.updated	2020-07-17T12:15:45Z
pubs.issue	1
pubs.publication-status	Published
pubs.volume	28
utslib.citation.issue	1

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.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/141792