Richard Watson, Principal

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Administration

Administration & Voluntary Administration

Company Administration

If a company does not have sufficient funds to continue trading it is likely to be insolvent or become insolvent and it may enter into administration.

An administrator is a solvency practitioner who is independent of the company in question. If required we can refer you to an appropriately qualified insolvency practitioner or you may wish to appoint one whom your accountant or other person may know.

During administration a company is protected from its creditors while the various alternatives are considered.

More Voluntary Administration information

Administrators have the power to call a meeting of creditors to decide whether to put a company into liquidation, or to accept any proposal or offer of the directors or other persons (allowing the company to trade in particular, in its core business to generate cash flow to pay its debts). If there is a proposal put for the business to continue and creditors to be paid, the company and its directors execute a Deed of Company Arrangement. This is an alternative to liquidation. At the time of considering the proposal the creditors consider a report from the insolvency practitioner as to their recommendation. Eventually, the decision as to whether a proposal for a Deed of Company Arrangement is entered into is a decision for the creditors of the company. If a Deed of Company Arrangement is entered into then during this phase the administrator retains control of the deed fund in accordance with the Deed of Company Arrangement until the debts are paid. A Deed of Company Arrangement can be varied as to its terms and are in place in light of the various alternatives that may be available to a company. Some examples, external persons such as relatives fund the Deed of Company Arrangement and in others, the funding is from the continued trading and in some it is a combination of both.

During administration a company is protected from its creditors whilst consideration given to the restructuring plan. This technique can be very beneficial when a company has an aggressive or some aggressive creditors.

Further, if a director of the company receives a notice from the tax office in relation to tax due by a company then it may be that the director will become personally liable if it does not take urgent action for the appointment of an administrator or otherwise. Before entering into any arrangement with the tax office in relation to debts of the company a director should seek appropriate proper advice as to whether the director will become liable if the company does not pay the debt.

Also if a director receives a notice from the tax office urgent advice should be sought as inaction may result in the director becoming personally liable whereas action could save the director from such personal liability.

Where there is a company administration there are issues relating to secured creditors being those creditors who have specific charges over specific assets of the company.

Also, one must consider whether a director has given personal guarantees as usually a company being in administration and arrangement by the creditors of the company or director through a Deed of Company Arrangement, usually will not relieve a person from personal obligations under the guarantee.

Voluntary Administration

Voluntary Administration can be described as a mechanism instigated by a company in financial distress to obtain a level of protection from its creditors for enough time as needed to save the business and avoid liquidation.

The procedure comes from Part 5.3 A of the Corporations Act 2001 (Cth). The purpose of this Act is to allow the company to avoid liquidation and to have the company administered in such a way that maximises the chances of the company and its business continuing; or if it can't continue, to allow a better return for the company's creditors and shareholders than would result from the liquidation of the company.

A meeting of directors starts the process off and, as with administration, an Administrator is appointed. The first meeting of creditors is held within 5 days and a second meeting to decide the company's future is held within a 28 day period.

Voluntary administration provides a statutory framework for an offer to be put to creditors in compromise of their claims. In doing so, it provides a company with a mechanism to carry out its duties in what might previously have been attempted by an informal arrangement, whilst also protecting the interests of creditors involved.

Contact Watson and Watson now for more information or to schedule an appointment.

“When experience matters... Choose Watson and Watson Solicitors”

Please note that our provision of any telephone advice to you is only a general discussion to assist as to whether you wish to instruct us. Telephone discussions should not be construed as legal advice and are not to be relied upon. Legal advice which you can rely on can only be properly provided by us to you at or following an initial conference. We are not responsible for any action you may take or fail to take based upon the provision of our telephone advice to you. If you wish to arrange a conference, please contact us.

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Recent Cases

Defective Building Work Residential Home - Insolvency - 30/09/2010

Watson & Watson act on behalf of the Home Owner in relation to a claim against a Builder which became insolvent and was unable to complete their many projects. Generally, Creditors were out of pocket and an arrangement was entered...

Testimonials

7/11/2011

Many thanks for all your support in securing our unit. We very much appreciate your help. Kind Regards.
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1/11/2011

Absolutely fabulous Lelien, we are definitely keen on this strategy. Very happy with your process so far. Many thanks again.
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9/10/2011

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2/10/2011

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29/09/2011

"Richard. Many thanks. We are very appreciative of the professional assistance given to us in relation to our claim for defective building works. With your professional help we were able to come to a satisfactory resolution to our long standing problem"
- J.H, Gosford

20/09/2011

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22/07/2011

"I am personally grateful for the effort put into this by all concerned. I do believe the issues have been thoroughly aired and we can now finalise the matter."
- J.T, Sydney

18/07/2011

"To Chris Jefferies,
We wish to thank you for the efficiency you have displayed in the Conciliation Conference and for settling the matter for us."
- Holden Barlow Solicitors, Perth

28/06/2011

"Thanks again for all your help. You've been an absolute delight to deal with."
-B.M, Sydney

3/06/2011

"Dennis, Thank you for your advice and taking my case in this matter. Peter has spoken so highly of you."
- S.Y, Sydney

26/05/2011

"Dear Dennis,
Wonderful news!
Thank you kindly for your great work, I am so very pleased and thrilled with the result.
My life is so much brighter and we can stay here in Australia.
All my family are grateful and so happy."
- L.S, Sydney

25/05/2011

"I would also like to acknowledge all Dennis' expertise and hard work."
- P.L, Sydney

17/05/2011

"Just to say a big thank you for today! I am delighted with the result."
- J.M, Eastern Suburbs

11/05/2011

"Dennis,

I am writing to send my deepest thanks for yesterday's outcome. Your efforts in pressing the case have been nothing short of magnificent.

I have been (in part) of a mind set that defeat and rejection was to be my soul mate on this issue. But yesterday's fine transition from nothing to something is such an incredibley happy outcome. Your considered opinitions, general care and legwork, as a commmiteed and compassionate advocate will stick as a life long memory. I feel extremely fortunate and proud of what has been achieved.

I understand too, with the joy comes the responsibility. The message of dilligence is not lost and is branded into the forefront of my mind.

Yours in sincere thanks."
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11/05/2011

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4/05/2011

"Despite trying very hard to come to amicable agreement we found ourselves in the dreadful position of constant intimidation correspondence from the solicitors of the buildings who undertook residential renovations. As a result I instructed Richard Watson to act in the matter. It turned out that having a firm of solicitors highly experienced and qualified in the very complex area of building law proved essential and indeed saved the day. This together with their kindness and open and honest frankness made something that was looking impossible into a great success."
- M.N, Eastern Suburbs

21/04/2011

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- C.F, Lower North Shore

20/04/2011

"Thank you very much for you have done job for me!"
-S.L Parramatta

31/03/2011

"We greatly appreciate the efficiency and also the time to see us the Tuesday night before we exchanged contracts. We moved in on the weekend and are very happy."
- PB-H, Lower North Shore

29/03/2011

"I appreciate the professional assistance given."
- D.D, South West Suburbs

4/03/2011

"You have been wonderful and worth every penny."
- P.H, Canada

4/03/2011

"I'd just like to say a big thank you!
I appreciate your help and patience throughout."
- J.F, Eastern Suburbs

21/01/2011

"Thank you, thank you, thank you."
- Z.H, Sydney City

1/12/2010

"I found myself in a difficult situation and was fortunate to engage Richard Watson of Watson & Watson. Richard helped explain the options and alternatives available to me and the likely outcomes having regard to all matters to be taken into account. Richard helped me come to a very satisfactory resolution of the matters and as a result I have been able to secure accommodation for myself and children in the local district in a relatively short period of time. In addition to the advice as to the various alternatives, options and likely outcomes I found Richard caring.

Throughout when things were difficult Richard was a steady influence so that I could achieve the optimum outcome for all concerned. I recommend Watson & Watson for any other person in similar circumstances. "
-S.J.G Cremorne

1/11/2010

"Just would to wish you a very Merry Christmas. I will never forget your kindness and generosity - and strength at times I feel you worked with the mighty Lord - quite testifying!
I have so much gained from the experience in many ways."
Best Wishes and Many Regards,
-R.L

1/08/2010

"Hi Richard ,
This is just a brief note of thanks for taking care of me through this horrible situation.
I know you are a pro but for those of us that are faced with the reality... it's scary & sad. "
Best Regards,
-D.T

1/08/2010

"I was in a position that I had exchanged on the purchase of a property and I had agreement from my ex for funding the purchase, however, after I exchanged to purchase, my ex changed his verbal agreement. I came to Watson & Watson as my daughter had received a very good outcome with understanding. Watson & Watson in a very short period of time achieved a cost effective settlement which allowed me to complete my purchase. Their experience relating to various alternatives gave me other alternatives and allowed me to conclude the finalization of the property matter with my ex and the purchase of the property in a very short period of time and to my utmost satisfaction."
-K.S Leura

1/07/2010

"Watson & Watson have performed exceptionally in a cost effective manner for the Bank for in excess of 20 years and never recovered less than expectations. Their work is professional, cost effective and always above expectations. In all my years with Watson & Watson the Bank has only lost one case and that was the first case in which I was at the Bank instructing another solicitor for the Bank and Watson & Watson acted for the customer against the Bank, our solicitor lost, Watson & Watson acting for the customer against the Bank WON."

"I have been instructing legal firms in relation to litigation and recovery actions for the Bank for more than 20 years. Richard Watson and his team are result driven. The costs on a case by case basis is significantly less than other firms which I instruct from time to time on behalf of the Bank."
-H.B Bank Sydney

1/06/2010

"Dear Richard,,
Many thanks for all that you have done.
It is been a fantastic result."
Thank you
Best Wishes"
-R.L Surry Hills

31/05/2010

"My family bought property in the 1950's and registered it in the name of my brother. My brother assumed ownership of the property. Nothing was done until Richard Watson became involved and the matter was settled with a substantial payment to me, more than doubling my ample wealth."
-L.S Canberra

1/05/2010

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1/02/2010

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-A.L Pymble

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