FREE ELECTRONIC LIBRARY - Books, abstracts, thesis

Pages:     | 1 |   ...   | 7 | 8 || 10 |

«Gabrielle Smith A dissertation submitted in partial fulfilment of the degree of the Bachelor of Laws (Honours) at the University of Otago October ...»

-- [ Page 9 ] --

Conclusion New Zealand’s voidable preference law has been gradually shifting towards recognition that creditor equality is its fundamental objective. Preference law shook off its antiquated morality notion when it abandoned the debtor’s state of mind as the key element of a preference in the Companies Act 1993. However, Parliament was reluctant to fully embrace the equality principle and thus shifted the focus to the creditor’s culpability in receiving a preference through the ordinary course of business exception and the alteration position defence.

There is an inherent desirability in identifying an element of culpability in preference law, as it is always easier to punish certain behaviour rather than set preferences aside on the basis of the principle of equality. Parliament is reluctant to enact a regime that fully embraces the equality rationale for fears that such a regime would appear too inflexible and be rejected by creditors. The notion of equality in the


is always very appealing to creditors when they face the possibility of non-payment, however, as soon as a preferential payment is received creditors are only interested in ensuring that the equality principle is not used against them. 171 Thus Parliament sought to create a distinction between ‘innocent’ and ‘guilty’ creditors on the basis of their knowledge of insolvency in the Companies Amendment Act 2006.

This attempt to treat one creditor as more culpable than another ignores the fact that preferences are entirely legitimate transactions outside of insolvency and only become illegitimate by the retrospective operation of voidable preference law. If liquidation occurred at the same time as technical insolvency, the voidable preference provisions would be entirely redundant. However, the lag time between insolvency and liquidation creates the need for voidable preference law to impose equality on preliquidation behaviour. This is the primary objective of preference law and the culpability or knowledge of a creditor has no relevance to that aim.

Telfer, above n 84, at 57.

The true nature of voidable preference law is akin to strict liability. However, an absolute, automatic avoidance regime is not suggested. The running account principle is based on the sound premise that insolvency law is concerned with the net effect of the dealings between a creditor and debtor and thus some preferential payments should be allowed to stand. Furthermore, a short vulnerability period prevents undue disturbance of settled transactions. However, the erosion to creditor equality through the alteration of position defence cannot be justified. Repeal of the defence would uphold the equality rationale, reduce litigation and allow for greater preference recovery for the benefit of collective body of unsecured creditors. The implementation of these recommendations would create a regime that finally operates to give unsecured creditors a real chance at a pari passu distribution.

Bibliography Primary Sources Cases New Zealand Blanchett v McEntee Hire Holdings Ltd [2011] NZCCLR 4 (HC).

Chatfield v Mercury Energy Ltd; Contaminated Enterprises Ltd (in Liq) v Mercury Energy Ltd (1998) 8 NZCLC 261 Countrywide Banking Corp Ltd v Dean [1998] 1 NZLR 385 (PC).

Finnigan v He [2010] 2 NZLR 668 Firth Industries Ltd v Gray &Traveller (1998) 8 NZCLC 261 Levin v Market Square Trust [2007] NZCA 135 Meltzer v Origo (The Source) Ltd High Court Auckland, M1015/97, 7/12/1998 National Bank of NZ v Coyle (1999) 8 NZCLC 262,100 Porter Hire Ltd v Blanchett HC Auckland, CIV-2005-404-3056, 1 June 2006 Re Anntastic Marketing Ltd (in liq) [1999] 1 NZLR 615s Re Daytone Industries Ltd (in liq) HC Auckland, M13434/98, 27 November 1998 Re Excel Freight Ltd (in liq) [2001] 2 NZLR 541 (CA) Re Modern Terrazzo Ltd [1998] 1 NZLR 160 Re Northridge Properties Ltd Supreme Court Auckland, M 46 - 49/75, 77/75 13 December 1977 Re Wienk Industries Ltd (in liquidation) High Court Auckland, CIV-2003-404-816 17 September 2004.

Stotter v Ararimu Holdings Ltd (in statutory management) [1994] 2 NZLR 655 Stotter v Equiticorp Australia Ltd (in liq) [2002] 2 NZLR 686 Trans Otway Ltd v Shephard [2005] NZSC 76, [2006] 2 NZLR 289 Tyree Power Construction Ltd v DS Edmonds Electrical Ltd [1994] 2 NZLR 268 (CA) Waikato Freight and Storage (1988) Ltd v Meltzer [2001] 2 NZLR 541 (CA) Australia Air Australian Services v Ferrier (1996) 185 CLR 483; 14 ACLC 1403 Rees v Bank of New South Wales (1964) 111 CLR 210 Sutherland v Eurolinx (2001) 37 ACSR 477 Tolcher v National Australia Bank Ltd (2003) 174 FLR 251 United Kingdom Alderson v Temple (K.B. 1768) ER 384 Belmont Park Investments Pty Ltd v BNY Corporate Trustee Services Ltd [2012] 1 AC 383 British Eagle International Airways Ltd v Cie National Air France [1975] 1 WLR 758 (HL) HM Revenue and Customs v The Football League Ltd [2012] EWHC 1372 (Ch) Worseley v Demattos (1758) 97 ER 407 Legislation New Zealand Companies Act 1955 Companies Act 1993 Companies Amendment Act 2006 Insolvency Act 2006 Tax Administration Act 1984 Australia Corporations Act 2001 The United States Bankruptcy Act of 1841 Bankruptcy Act of 1867 Bankruptcy Code 1978 The United Kingdom Insolvency Act 1986 Secondary sources Books Vanessa Finch Corporate Insolvency Law: Perspectives and Principles (Cambridge University Press, Cambridge, 2002) I F Fletcher, The Law of Insolvency (2nd ed, Sweet & Maxwell, London, 1990) Roy Goode Principles of Corporate Insolvency Law (3rd ed, Sweet & Maxwell, London, 2005).

Paul Heath (ed) & Michael Whale (ed) Heath & Whale on Insolvency (online looseleaf, LexisNexis NZ) Thomas H. Jackson The Logic and Limits of Bankruptcy Law (Harvard University Press, Cambridge, 1986) W Stacy Jr Johnson “The Running-Account Creditor and Section 547(c)(4) of the New Bankruptcy Code” 16 Wake Forest L Rev. 962 (1980) Andrew Keay Avoidance Provisions in Insolvency Law (Law Book Company, Sydney, 1997) Charles Tabb The Law of Bankruptcy (Foundation Press, New York, 1997)

Journal articles

Michael A. Bloom, Richard D. Gorelick, Heather A. MacKenzie “Exceptions to Bankruptcy Preferences: Countryman Updated” (1991-1992) 47 Bus. Law.

H Bolitho “Continuing Business Relationships — Eight Questions in Search of an Answer” (1998) 16 Company and Securities Law Journal 581 David Brown & Thomas G W Telfer “The New “Australasian” Voidable Preference Law: Plus Ça Change?” (2007) 13 NZBLQ 160 M Conaglen ‘‘Voidable Preferences under the Companies Act 1993’’ (1996) NZ Law Rev 197 Vern Countryman “The Concept of a Voidable Preference in Bankruptcy” (1985) 38 VAND. L. Rev. 713.

R C.C. Cuming “Transactions at Undervalue and Preferences Under the Bankruptcy and Insolvency Act: Rethinking Outdated Approaches” (2002) 7 Can Bus J 5 Anthony Duggan and Thomas G.W. Telfer, “Canadian Preference Law Reform” (2006-2007) 42 Tex Intl LJ 661 John Farrar "The Bankruptcy of the Law of Fraudulent Preference" (1983) JBL 390.

R. Goode "Is the Law Too Favourable to Secured Creditors" (1983-84) 8 Can Bus LJ Michael J Herbert “ The Trustee Versus the Trade Creditor: A Critique of Section 547(c)(1), (2) & (4) of the Bankruptcy Cod” (1982 – 1983) 17 U Rich L Rev Thomas H. Jackson “Bankruptcy, Non-Bankruptcy Entitlements, and the 
 Creditor's Bargain" (1982) 91 Yale U 857 Andrew Keay “An Exposition and Assessment of Unfair Preferences” (1993-1994) 19 Melb U L Rev 545 Andrew Keay “In Pursuit of the Rationale Behind the Avoidance of Pre-Liquidation Transactions” (1996) 18 Syd LR 55 Andrew Keay ‘‘Liquidators Avoidance of Preferences: Issues of Concern and a Proposal for Radical Reform’’ (1996) 18 Adel L Rev 160 Trisk Keeper “Maxmising returns to creditors” (2011) 1 NZLJ 401 John C. McCoid ‘‘Bankruptcy, Preferences and Efficiency: An Expression of Doubt’’ (1981) 67 Va L Rev 249 Rizwaan Jameel Mokal “Priority as Pathology: The Pari Passu Myth” (2001) 60 CLJ Elizabeth A. Orelup, "Avoidance of Preferential Transfers Under the Bankruptcy Reform Act 1978" (1979) 65 Iowa L Rev 209

L Ponoroff ‘‘Evil Intentions and an Irresolute Endorsement for Scientific Rationalism:

Bankruptcy Preferences One More Time’’ (1993) Wisc L Rev 1439 Lawrence Ponoroff and Julie C Ashby “Desperate times and Desperate Measures: The troubled state of the ordinary course of business defence – and what to do about it” 72 WALR 5 Max Radin “The Nature of Bankruptcy” (1940) 89 U P L Rev 1 M Ross ‘‘Payments Made in the Ordinary Course of Business’’(2000) 8 Insol LJ 157 Harris P. Quinn “Subsequent New Value Exception under Section 547(c)(4) of the Bankruptcy Code - Judicial Gloss Is Creditors' Loss” (1993-1994) 24 Mem St U L Rev 667 C Seligson "Preferences Under the Bankruptcy Act" (1961) 15 Vanderbilt LR Charles Jordan Tabb “Panglossian Preference Paradigm?” (1997) 5 Am Bankr Inst L Rev 407 Charles Jordan Tabb “Rethinking Preferences” (1991-92) 43 SCL Rev 981 Thomas G.W. Telfer “Voidable Preference Reform: A New Zealand Perspective on Shifting Standards and Goalposts” (2003) 12 Int Insolv Rev 55 Thomas M. Ward and Jay A. Shulman “In Defense of the Bankruptcy Code's Radical Integration of the Preference Rules Affecting Commercial Financing” (1983Wash U L Q 1 R Weisberg “Commercial Morality, the Merchant Character, and the History of the Voidable Preference” (1986) 39 Stan L Rev 3 Reports Australian Law Reform Commission, General Insolvency Inquiry Report No 45 (Australian Government Publishing Service, Canberra, 1988) David Brown, Voidable Transactions - A Report for the Ministry of Commerce, (Wellington, 1999) Law Reform Division, Department of Justice Insolvency Law Reform: A Discussion Paper (Wellington, 1988).

Ministry of Economic Development Insolvency Law Review: Tier One Discussion Documents (Wellington, 2001).

New Zealand Law Commission, Company Law Reform and Restatement, NZLC Report 9 (1989) Tamara M. Buckwold, Uniform Law Conference of Canada Reform of Fraudulent Conveyances and Fraudulent Preferences Law (Transactions and Undervalue and Preferential Transfers) Part II: Preferential Transfers (2008)

Appendix One: Companies Act 1993 ss 292, 294 – 296

292 Insolvent transaction voidable (1)
 A transaction by a company is voidable by the liquidator if it— (a)
 is an insolvent transaction; and (b)
 is entered into within the specified period.

 An insolvent transaction is a transaction by a company that— (a)
 is entered into at a time when the company is unable to pay its due debts;

and (b)
 enables another person to receive more towards satisfaction of a debt owed by the company than the person would receive, or would be likely to receive, in the company's liquidation.

 In this section, transaction means any of the following steps by the company:

 conveying or transferring the company's property:

 creating a charge over the company's property:

 incurring an obligation:

 undergoing an execution process:

 paying money (including paying money in accordance with a judgment or

an order of a court):

 anything done or omitted to be done for the purpose of entering into the transaction or giving effect to it.

 In this section, transaction includes a transaction by a receiver, except a transaction that discharges, whether in part or in full, a liability for which the receiver is personally liable under section 32(1) or (5) of the Receiverships Act 1993 or otherwise personally liable under a contract entered into by the receiver.
 A transaction that is entered into within the restricted period is presumed, unless the contrary is proved, to be entered into at a time when the company is unable to pay its due debts.
 Where— (a)
 a transaction is, for commercial purposes, an integral part of a continuing business relationship (for example, a running account) between a company and a creditor of the company (including a relationship to which other persons are parties); and (b)
 in the course of the relationship, the level of the company's net indebtedness to the creditor is increased and reduced from time to time as the result of a series of transactions forming part of the relationship;

then— (c)
 subsection (1) applies in relation to all the transactions forming part of the relationship as if they together constituted a single transaction; and (d)
 the transaction referred to in paragraph (a) may only be taken to be an insolvent transaction voidable by the liquidator if the effect of applying subsection (1) in accordance with paragraph (c) is that the single transaction referred to in paragraph (c) is taken to be an insolvent transaction voidable by the liquidator.

 For the purposes of subsections (1) and (4B), specified period means— (a)
 the period of 2 years before the date of commencement of the liquidation together with the period commencing on that date and ending at the time at which the liquidator is appointed; and (b)
 in the case of a company that was put into liquidation by the court, the period of 2 years before the making of the application to the court together with the period commencing on the date of the making of that application and ending on the date on which, and at the time at which, the order was made;

and (c)
 if— (i)
 an application was made to the court to put a company into liquidation; and (ii)
 after the making of the application to the court a liquidator was appointed under paragraph (a) or paragraph (b) of section 241(2),— the period of 2 years before the making of the application to the court together with the period commencing on the date of the making of that application and ending on the date and at the time of the commencement of the liquidation.

 For the purposes of subsection (4A), restricted period means— (a)
 the period of 6 months before the date of commencement of the liquidation together with the period commencing on that date and ending at the time at which the liquidator is appointed; and

–  –  –

294 Procedure for setting aside transactions and charges (1)
 A liquidator who wishes to set aside a transaction or charge that is voidable under section 292 or 293 must— (a)
 file a notice with the court that meets the requirements set out in subsection (2); and (b)
 serve the notice as soon as practicable on— (i)
 the other party to the transaction or the charge holder, as the case may be; and (ii)
 any other party from whom the liquidator intends to recover.

Pages:     | 1 |   ...   | 7 | 8 || 10 |

Similar works:

«Religious Plurality and the Public Space Joint Christian-Muslim Theological Reflections Religious Plurality and the Public Space Joint Christian–Muslim Theological Reflections LWF Studies 2015/1 The views expressed in this publication are those of the authors and do not necessarily reflect the official position of the Lutheran World Federation Religious Plurality and the Public Space Joint Christian–Muslim Theological Reflections Edited by Simone Sinn, Mouhanad Khorchide, Dina El Omari LWF...»

«A Novel Interactive Paradigm for Teaching Quantum Mechanics Mithila Tople, Georgia Institute of Technology Rose Peng, Georgia Institute of Technology William Dorn, Georgia Institute of Technology Shaziya Tambawala, Georgia Institute of Technology Azad Naeemi, Georgia Institute of Technology Nassim JafariNaimi, Georgia Institute of Technology Abstract: Quantum Mechanics (QM) is the foundation for science and engineering disciplines as diverse as physics, materials science, chemistry, and...»

«In the United States Court of Federal Claims No. 11-157C (Filed: June 12, 2014) ********************************** ) Calculation of interest as part of the ) judgment in a contract case; interest BAY COUNTY, FLORIDA, ) due under the Contract Disputes Act, ) 41 U.S.C. § 7109, on an undisputed Plaintiff, ) amount plus one year of interest payable ) under the Prompt Payment Act, 31 U.S.C. v. ) § 3902(a); interest due under the Contract ) Disputes Act on damages previously in UNITED STATES, )...»

«Tax Tips for CALIFORNIA STATE BOARD OF EQUALIZATION Leasing of Tangible MEMBER Personal Property First District BRAD SHERMAN Los Angeles Second District In California ERNEST J. DRONENBURG, JR. San Diego Third District MATTHEW K. FONG Los Angeles Sales and Use Taxes Fourth District GRAY DAVIS Sacramento State Controller BURTON W. OLIVER Sacramento Executive Director January 1994 Pamphlet No. 46 • LDA PREFACE This pamphlet is designed as a general guide for both lessors and lessees in...»

«Die Bedeutung Der Personalfuhrung Fur Eine Erfolgreiche Implementierung Die Bedeutung Der Personalfuhrung Fur Eine Erfolgreiche Implementierung Von Total Quality Management Im Unternehmen Von Total Quality Management Im Unternehmen You fit not as to make your replacement but make away to keep time. That yourself just are to visit the real detail home, your $100 forums can assist further invite Die Bedeutung Der Personalfuhrung Fur Eine Erfolgreiche Implementierung Von Total Quality Management...»

«May 2015 Bar Pass Rates & “Quality” Law School Education Do We Have a Nexus?-And the Remedy Stanislaus Pulle Ph.D. Former Visiting Scholar of Yale Law School and Research Fellow of the Institute of Advanced Legal Studies, University of London Dean of Law Southern California Institute of Law @ Santa Barbara and Ventura I. INTRODUCTION Legal scholars have concluded that there is “no automatic correlation between raw bar passage rates and the quality of legal education provided by a law...»

«DIRECTION GÉNÉRALE DES POLITIQUES INTERNES DE L'UNION DÉPARTEMENT THÉMATIQUE C: DROITS DES CITOYENS ET AFFAIRES CONSTITUTIONNELLES AFFAIRES JURIDIQUES Interprétation de l’exception d’ordre public telle que prévue par les instruments du droit international privé et du droit procédural de l’Union européenne ÉTUDE Résumé La présente étude, rédigée par le professeur Burkhard Hess et le professeur Thomas Pfeiffer, de l’université de Heidelberg, propose une analyse complète...»

«Slade, M. Pressure Sewer Services Australia. Verbal information recorded at the Lawrence Close out workshop on the 23rd February 2010. BARLEY STRAW: A NATURAL ALGAE INHIBITOR Paper Presented by: John Holmes Author: John Holmes, Operator Woolgoolga Water Reclamation Plant, Coffs Harbour Water 4th Annual WIOA NSW Water Industry Engineers & Operators Conference St Stanislaus’ College, Bathurst 20 to 22 April, 2010 Page No. 33 4th Annual WIOA NSW Water Industry Engineers & Operators Conference St...»

«VIRGINIA STATE POLICE UNIFORM CRIME REPORTING INCIDENT-BASED PROCEDURE GUIDE MANUAL The Department of State Police Criminal Justice Information Services Division P.O. Box 27472 Richmond, Virginia 23261-7472 REVISED: November 2009 Approved: _ SUPERINTENDENT Distribution List Office of Performance Management and Internal Controls Director Planning and Research Manager Information Technology Director Application Manager Professional Standards Unit Director Internal Auditors Criminal Justice...»

«ARIZONA RECREATIONAL VEHICLE LONG-TERM RENTAL SPACE ACT TITLE 33, CHAPTER 19 UPDATED WITH LAW EFFECTIVE 2013 ARIZONA RECREATIONAL VEHICLE LONG-TERM RENTAL SPACE ACT TITLE 33, CHAPTER 19 UPDATE WITH LAWS EFFECTIVE DEC. 31, 2013 General Provisions 33-2101 Application; duration of stay; exclusions 33-2102 Definitions 33-2103 Obligation of good faith 33-2104 Unconscionability 33-2105 Terms and conditions of rental agreement; notice, removal 33-2106 Prohibited provisions in rental agreements 33-2107...»

«Aalborg Universitet Supporting Capacity Development for Sustainable Land Administration Infrastructures Enemark, Stig Published in: Report of the Eighth United Nations Regional Cartographic Conference for the Americas Publication date: Document Version Publisher's PDF, also known as Version of record Link to publication from Aalborg University Citation for published version (APA): Enemark, S. (2005). Supporting Capacity Development for Sustainable Land Administration Infrastructures. In Report...»

«Typical Tax Aspects of Real Property Leases Langdon T. Owen, Jr.1 Parsons Kinghorn Harris (801) 363-4300 This article is provided for informational purposes only. It is not intended as, and does not constitute, legal advice. Further, access to or receipt of this article by anyone does not create an attorney-client relationship. Although this article was believed to be correct within the scope of its purposes when written, it may be incorrect or incomplete, was not intended to comprehensively...»

<<  HOME   |    CONTACTS
2016 www.book.xlibx.info - Free e-library - Books, abstracts, thesis

Materials of this site are available for review, all rights belong to their respective owners.
If you do not agree with the fact that your material is placed on this site, please, email us, we will within 1-2 business days delete him.