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ARTICLE · 27 JULY 2016

Trust companies in liquidation - dealing with priority debts

Clayton Utz
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A recent NSW decision has implications for liquidators of trustee companies dealing with trust funds and priority debts.

AustraliaInsolvency/Bankruptcy/Re-Structuring
Mikhail Glavac
Mikhail Glavac
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The decision in In the matter of Independent Contractor Services (Aust) could mean more reliance upon fair entitlements guarantee funding provided by the Commonwealth in relation to the liquidation of trading trusts.

A recent decision of the NSW Supreme Court has some interesting implications for liquidators of trustee companies dealing with any recovered trust funds and priority debts. At the same time, the Court reconsidered the manner in which it will approach a liquidator's remuneration (In the matter of Independent Contractor Services (Aust) Pty Limited ACN 119 186 971 (in liquidation) (No 2) [2016] NSWSC 106).

A trustee company goes into liquidation

Independent Contractor Services (ICS) was a staffing agency which supplied persons whom it had retained (contractors) to deliver services on behalf of information technology and engineering consultancies. The business used a structure whereby ICS was trustee of a discretionary trust called the Independent

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