ANOTHER INVESTIGATIVE TOOL AVAILABLE TO INSOLVENCY
PRACTITIONERS.
When an insolvency practitioner (IP) is appointed over an
insolvent entity, they have important duties to perform including
the collection of books and records and investigating the
examinable affairs of the entity.
When the entity's books and records are not fully available
the IP is limited in their investigations. Where an IP suspects
voidable transactions or other claims are available against
directors or related parties, they can apply to court to require
certain persons to appear for a public examination (PE) and to
produce certain documents.
Legislative framework
Section 596A of the Corporations Act 2001 provides for
the mandatory examination of an officer
of a corporation about its examinable affairs where an eligible
applicant applies for summons. An eligible applicant1 is
defined as:
