Easy as ABC – Insolvency and the Relation-Back Day

Introduction

The Full Court of the Federal Court of Australia has rejected an argument that the applicant for an order for a company to be wound up in insolvency must prove that the company was insolvent at the "relation-back day" in addition to proving insolvency at the date of filing the application and the date of the hearing.

On 12 July 2013, the Full Court delivered judgment in CBA Corporate Services (NSW) Pty Limited v Walker and Moloney, in the matter of ZYX Learning Centres Limited (receivers and managers appointed) (in liq).¹ ZYX Learning Centres Limited (Receivers and Managers Appointed) (In Liquidation) was formerly known as ABC Learning Centres Limited (ABC). ABC and its related companies (ABC Group) conducted the well-known Australian and international childcare empire that collapsed in late 2008.