Transactions are unreasonable director related transactions if it involves a director or close associate (as defined) of the company and had no or little benefit to the company (i.e. it was unreasonable for the company to enter into the transaction).
The Corporations Act sometimes will require the other party to the transaction to return an asset or make a payment to the liquidator.
The main elements of unreasonable director related transactions are:
i. a director of the company,
ii. a close associate of a director of the company, or
iii. a ‘nominee’ person acting on behalf of or for the benefit of a director or their close associate.
Related: See Uncommercial Transactions
C&N Turnaround Solutions can assist a director of a company that may have an Unreasonable Director Related Transaction claim brought against them by a Liquidator. We can assist and advise clients who are subject to these claims by potentially reducing or eliminating the amount required to be paid by the client.
To make a claim the liquidator must prove that:
When a director of a company receives a demand for Unreasonable Director Related Transaction from a Liquidator.
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…