The insolvency of a company which is the trustee of a trust
presents particular challenges for creditors, insolvency
practitioners, and beneficiaries. A recent case[1] in the WA Supreme
Court provides a handy blueprint for analysing the issues that
arise from insolvent trustee companies. It also offers an
interesting solution to the problems which liquidators face in
having to differentiate between trust and non-trust assets.
Background
In January 2015 Winter Holdings (WA) Pty Ltd was placed into
liquidation, as a result of a tax debt of $278,893.94.
Winter Holdings was, among other things, the trustee of the
Laurus Arx Trust (the Trust) which was established
in 2009. Winter Holdings, as trustee of the Trust, was in a
partnership which operated a nightclub in Subiaco (the
business).
