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Corporate Responsibility and Employment Security Bill 2001
Schedule 1 —Amendments to the Corporations Act 2001

1  After Division 6 of Part 5.7B

Insert:

Division 6A - Liability of a related body corporate for the debts or liabilities of a company

588YA Liability of a related body corporate for the debts or liabilities of a company

             (1)  When a company is being wound up in insolvency, the liquidator, a creditor of the company, a nominee of a creditor of the company or the ASIC may apply to the Court for an order that a company that is or has been a related body corporate pay to the liquidator the whole or part of the amount of a debt of the insolvent company.  The Court may make such an order if it is satisfied that it is just to do so.

             (2)  In deciding whether it is just to make an order under subsection (1), , the matters to which the Court shall have regard include:

                     (a) 

(a)                                                whether the company provided services for or on behalf of the related body corporate; and

                     (b)   whether the company occupied premises which are owned by the related body corporate; and

                     (c) 

the extent to which the related body corporate took part in the management of the company; and

                         

                     (d)  the conduct of the related body corporate towards the creditors of the company generally and to the creditor to which the debt or liability relates; and

                     (e) 

                     (e)  the extent to which the circumstances that gave rise to the winding up of the company are attributable to the actions of the related body corporate or an officer or officers of the related body corporate; and

                      (f) 

                      (f)  any other relevant matters as the Court considers just and appropriate.

(a)              (3) 

(3) Where the Court is satisfied that the matters set out in 2(a) to (f) exist or that the circumstances that gave rise to the winding up of the company are substantially attributable to the actions of the related body corporate or an officer or officers of the related body corporate, the related body corporate shall bear the onus of establishing why an order under this section should not be made.

(4)              (4)  An order under this section may be subject to conditions.

 

             (5)  An order shall not be made under this section if the only ground for making the order is that creditors of the company have relied on the fact that another company is or has been a related body corporate of the company.

2 2  S S ection 1317J

Insert after subsection 1317J(2) :

  (2A) A creditor of the corporation, or a nominee of a creditor of the corporation, may apply for a compensation order.