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No more peak indebtedness in unfair preferences - 3 things you should know

The Full Court of the Federal Court of Australia in Badenoch Integrated Logging Pty Ltd v Bryant, in the matter of Gunns Limited (in liq) (receivers and managers appointed)[2021] FCAFC 64 (Badenoch No. 1) has decided that the peak indebtedness rule, often relied upon by liquidators in calculating the quantum of unfair preference claims in situations where there was a continuing trading relationship between the company in liquidation and the creditor under section 588FA(3) of the Corporations Act 2001 (Cth) (the Act), does not apply.
  • 26 Jul 2021

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