Voidable Transactions – When does interest begin to accrue?

Voidable transactions form a vital part of the insolvency regime and ensures that the assets of an insolvent company are made equally available to its creditors, particularly those that have been sought to be made unavailable in the period leading up to the insolvency. In effect, the regime affords creditors confidence that if anyone is aware of the impending insolvency and tries to better their position against other creditors of the insolvent company, there is a mechanism in place that allows liquidators to return and make the assets available for all creditors.

Once such assets are recovered, is a liquidator able to claim an additional amount on account of interest? The recent decision by the Federal Court in Cooper as Liquidator of Runtong Investment and Development Pty Ltd (In Liq) v CEG Direct Securities Pty Ltd (Costs)¹ looks at a liquidator's claim for interest on a transaction that was deemed voidable by the Court.