Uncommercial Transactions
What are Uncommercial Transactions?
A transaction that a liquidator believes was either not beneficial or detrimental to the company is an uncommercial transaction. This differs from unreasonable director related transactions in that it doesn’t specifically involve directorsto be considered uncommercial.
Related: See Unreasonable Director Related Transactions
Assistance with / Defending Claims of Uncommercial Transactions: Who is this service for/aimed at?
A director of a company that may have an Uncommercial Transaction claim brought against them by a Liquidator. C&N Turnaround Solutions can advise clients on how they could potentially reduce or eliminate the amount required to be repaid.
How it works? What’s the process?
To be able to void an uncommercial transaction, the liquidator must show (amongst other things) that:
- a transaction was entered into
- there was no benefit to or there was a detriment to the company by entering into the transaction
- it occurred at a time when the company was insolvent
- the party suspected or should have suspected that the company was insolvent at the time of the transaction.
Unlike unfair preferences, the other party to the transaction does not have to be a creditor of the company. It can be any third party who enters into a transaction with the company. But often the other party is related to the company and the Act contains special provisions that assist liquidators void uncommercial transactions with related parties.
When will this service be required?
When a director of a company receives a demand for an Uncommercial Transaction from a Liquidator.
What are the benefits/outcomes of engaging this service?
Reduction or elimination of the amount required to be repaid by the client to a Liquidator by assisting the client to provide their defences to such a claim, or to engage an appropriately qualified Lawyer to defend them.
Call 02 9299 7000 or click here to submit your enquiry
With C&N Turnaround Solutions, we can help you untangle the mess, clear a way forward, and give you peace of mind…