Bankruptcy and Insolvency2024-10-14T14:05:37+00:00

BANKRUPTCY & INSOLVENCY LAWYERS

Every Move Matters

Litigation Lawyers Sunshine Coast

Every – Move – Matters

Bankruptcy & insolvency lawyers, sunshine coast

Financial distress, whether personal or business-related, can create significant stress and uncertainty. Insolvency and bankruptcy issues may arise from unmanageable debts, cash flow problems, or failed business ventures. These circumstances lead to difficult decision-making and can give rise to complex legal issues. Addressing these problems requires not just legal expertise but also a deep understanding of financial matters and their wider consequences.

At Axia Litigation Lawyers, our expert bankruptcy and insolvency lawyers are here to help you navigate the complexities of financial distress. We understand that your situation may feel overwhelming, but it may not be as hopeless as it seems. We provide tailored solutions to protect your interests and guide you through these challenging times. Whether you’re facing insolvency issues locally, elsewhere in Australia, or internationally, our dedicated team is here to support you every step of the way.

Contact us: Monday to Friday : 9 am – 5 pm

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EVERY MOVE MATTERS

bankruptcy & Insolvency Services

At Axia Litigation Lawyers, our experienced insolvency and bankruptcy lawyers are well-versed in handling a broad range of complex financial problems. We provide expert legal guidance to help you navigate insolvency challenges and protect your financial interests. Whether you need advice on bankruptcy, insolvency, or are involved in pursuing or defending claims by trustees or liquidators, our seasoned team is equipped to manage your case with efficiency and expertise.

Personal Insolvency & Bankruptcy Advice

Navigating personal bankruptcy complexities, providing legal clarity and supportive guidance for a fresh start.

Corporate Insolvency Advice

Expert counsel on corporate insolvency, aiding businesses in managing debt and restructuring strategies.

Pursuing & Defending claims by trustees in bankruptcy

Advocating for or against trustee claims, protecting assets and negotiating fair resolutions in bankruptcy.

pursuing & defending claims by liquidators

Representing companies and directors in liquidation matters, ensuring just outcomes in claims by or against liquidators.

Every – Move – Matters

How Axia can help with bankruptcy & insolvency

Axia Litigation Lawyers can provide a comprehensive suite of services to clients facing bankruptcy or insolvency. Our approach is multifaceted, aiming to safeguard the interests of our clients while navigating the complexities of insolvency and bankruptcy law. Here are the key ways in which we can assist:

Conduct a thorough review of the financial situation and provide legal advice on options such as restructuring, refinancing, voluntary administration, or insolvency and bankruptcy. This includes potential advantages and implications of each financial option.

Engage with creditors to negotiate payment plans, settlements, or agreements to achieve an outcome that allows for business continuity or individual financial stability.

We represent the interests of creditors throughout these processes, ensuring their rights and claims are effectively managed and enforced.

Facilitate voluntary administration for companies and negotiate and draft a Deed of Company Arrangement, providing a structured approach for company recovery or orderly wind-up.

Guide clients through the processes of liquidation or bankruptcy proceedings, ensuring compliance with statutory obligations and effectively represent their interests in interactions with liquidators or trustees.

Provide robust representation in court proceedings related to insolvency and bankruptcy, including defending against creditor, third party, liquidator and/or trustee claims and disputes arising from insolvency and bankruptcy actions.

Advise company directors on their duties and potential personal liabilities, including defending against claims of insolvent trading and breaches of director duties.

Advise on the protection and preservation of assets within the bounds of the law, including the validity and enforceability of security interests.

We work with insolvency practitioners to ensure the effective administration of liquidations and bankrupt estates, while protecting our clients’ interests.

Assist in pursuing any outstanding debts or assets owed to the client, including initiating, or defending against recovery actions like preferential payments and uncommercial transactions.

For individuals, explore alternatives to bankruptcy such as debt agreements or personal insolvency agreements, and provide advice on the implications and processes involved.

Manage communication with all stakeholders, including employees, suppliers, and customers, to maintain confidence and manage reputational risk.

Explore options for annulment of bankruptcy for individuals, including payment of debts in full or through a composition or arrangement with creditors, or prove in court that you should not have become bankrupt.
  • Financial Assessment and Legal Advice

  • Negotiation with Creditors 

  • Voluntary Administration and DOCA

  • Court Representation

  • Liquidation and Bankruptcy Proceedings

  • Director’s Duties and Personal Liabilities

  • Negotiation For Creditors

  • Asset Protection

  • Insolvency Practitioner Liaison

  • Recovery Actions

  • Personal Insolvency Solutions

  • Stakeholder Communication

  • Annulment of Bankruptcy

Our team is well-versed in the Corporations Act 2001 (Cth), the Bankruptcy Act 1966 (Cth), and relevant case law, ensuring that our clients receive informed and effective legal representation throughout the insolvency process. We aim to deliver outcomes that are aligned with our clients’ commercial objectives and legal obligations.

Financial Assessment and Legal Advice
Conduct a thorough review of the financial situation and provide legal advice on options such as restructuring, refinancing, voluntary administration, or insolvency and bankruptcy. This includes potential advantages and implications of each financial option.
Negotiation with Creditors
Engage with creditors to negotiate payment plans, settlements, or agreements to achieve an outcome that allows for business continuity or individual financial stability.
Negotiation For Creditors
We represent the interests of creditors throughout these processes, ensuring their rights and claims are effectively managed and enforced.
Voluntary Administration and DOCA
Facilitate voluntary administration for companies and negotiate and draft a Deed of Company Arrangement, providing a structured approach for company recovery or orderly wind-up.
Liquidation and Bankruptcy Proceedings
Guide clients through the processes of liquidation or bankruptcy proceedings, ensuring compliance with statutory obligations and effectively represent their interests in interactions with liquidators or trustees.
Court Representation
Provide robust representation in court proceedings related to insolvency and bankruptcy, including defending against creditor, third party, liquidator and/or trustee claims and disputes arising from insolvency and bankruptcy actions.
Director's Duties and Personal Liabilities
Advise company directors on their duties and potential personal liabilities, including defending against claims of insolvent trading and breaches of director duties.
Asset Protection
Advise on the protection and preservation of assets within the bounds of the law, including the validity and enforceability of security interests.
Insolvency Practitioner Liaison
We work with insolvency practitioners to ensure the effective administration of liquidations and bankrupt estates, while protecting our clients’ interests.
Recovery Actions
Assist in pursuing any outstanding debts or assets owed to the client, including initiating, or defending against recovery actions like preferential payments and uncommercial transactions.
Personal Insolvency Solutions
For individuals, explore alternatives to bankruptcy such as debt agreements or personal insolvency agreements, and provide advice on the implications and processes involved.
Stakeholder Communication
Manage communication with all stakeholders, including employees, suppliers, and customers, to maintain confidence and manage reputational risk
Annulment of Bankruptcy
Explore options for annulment of bankruptcy for individuals, including payment of debts in full or through a composition or arrangement with creditors, or prove in court that you should not have become bankrupt.

Over 75 Years of Combined Experience

Meet Our Expert Team

Axia Litigation Lawyers provide exceptional service and peace of mind for their clients. Based on the Sunshine Coast, Queensland, the Axia team services clients throughout Australia and abroad.

Adam Brown

Managing Director

Adam is the founder and Managing Director of Axia Litigation Lawyers. Having worked in Litigation and Dispute Resolution for over…..

Deneil Brown, Chief Operating Officer, Axia Litigation Lawyers
Deneil Brown

Chief Operating Officer

Deneil has been immersed in the legal industry for over 25 years and has vast experience across practice management, accounts and paralegal…

Nakita Brown, Senior Associate, Axia Litigation Lawyers
Nakita Brown

Senior Associate

Nakita is an experienced commercial litigation lawyer, bringing over ten years of legal knowledge to the table. She spent her early career…

Shane Ulyatt, Senior Associate, Axia Litigation Lawyers
Shane Ulyatt

Senior Associate

With a specialised focus on civil and commercial litigation and dispute resolution, Shane expertly handles a broad spectrum of legal matters…

Sam nelson

Lawyer

Sam’s expertise of commercial and civil litigation ranges from building and construction disputes, commercial and retail shop lease matters ….

Adam Brown
Adam Brown
Managing Director

Adam is the founder and Managing Director of Axia Litigation Lawyers. Having worked in Litigation…..

Deneil Brown
Deneil Brown
Chief Operating Officer

Deneil has been immersed in the legal industry for over 25 years and has vast experience across…

Nakita Brown
Nakita Brown
Senior Associate

Nakita is an experienced commercial litigation lawyer, bringing over ten years of legal knowledge…

Shane Ulyatt
Shane Ulyatt
Senior Associate

With a specialised focus on civil and commercial litigation and dispute resolution, Shane expertly…

Sam Nelson
Sam Nelson
Lawyer

Sam’s expertise of commercial and civil litigation ranges from building and construction disputes…

Every Move Matters

frequently Asked questions about bankruptcy & insolvency

Insolvency occurs when an individual or company is unable to pay their debts as and when they fall due. In Australia, this is governed by the Corporations Act 2001 (Cth) for companies and the Bankruptcy Act 1966 (Cth) for individuals.

Insolvency is a term used when an individual or company can’t pay their bills as and when they fall due. Think of it as a financial state where the money coming in isn’t enough to cover the money that needs to go out. For companies, this could mean they can’t pay their suppliers, loans, or other operational expenses. For individuals, it means they can’t cover their bills, credit card payments, or other personal debts.

Bankruptcy, on the other hand, is a formal legal process that an individual can go through when they’re insolvent — that is, when they can’t pay their debts as an when they are due. By declaring bankruptcy, a person is essentially saying, “I can’t pay what I owe.” It’s a step that involves the law to help sort out the financial mess.

When someone declares bankruptcy, a trustee can be appointed in one of two primary ways, either via debtor’s petition (Voluntary Bankruptcy), or creditor’s petition (Involuntary Bankruptcy).

If an individual proceeds with a debtor’s petition, they can either nominate a trustee of their choice, or AFSA will appoint the Official Trustee.

If a creditor has successfully obtained a court order against the individual (a sequestration order), the court may appoint a registered trustee if one has consented to act, which is usually nominated by the creditors. Otherwise, AFSA will appoint the Official Trustee.

This trustee takes over the financial affairs of the person who’s bankrupt. They look at what assets the person has, like property or investments, and determines decide what can be recovered and sold to pay back the debts. The trustee also works out a plan to deal with the creditors — the people or companies that are owed money.

While bankruptcy can offer a fresh start by wiping out many debts, it’s not a clean slate without consequences. It can affect a person’s credit score, their ability to borrow money in the future, and even aspects of their employment. It’s also a matter of public record.

Insolvency doesn’t always lead to bankruptcy. Sometimes, individuals or companies can negotiate with creditors, restructure their debts, or find other ways to manage their financial situation without going down the bankruptcy route. For companies, there are different processes like voluntary administration or liquidation that can be considered when they’re insolvent.

In short, insolvency is the problem — not enough money to pay debts. Bankruptcy is a legal solution to that problem for individuals, but it’s a serious step with long-lasting implications.

Voluntary administration is a process for insolvent companies to resolve their financial difficulties. An administrator is appointed to take control of the company to try to work out a way to save either the company or its business. This process is outlined in Part 5.3A of the Corporations Act 2001 (Cth).

Operating while insolvent can lead to penalties, including civil or criminal charges for directors. It is crucial to seek professional advice if insolvency is imminent. Under certain circumstances, such as a safe harbour provision, directors may have some protection from liability.

l. Bankruptcy can have several consequences for individuals, including the loss of assets, adverse effects on credit rating, and restrictions on international travel and eligibility for certain forms of employment. It typically lasts for three years and one day, starting from the filing of the statement of affairs with AFSA or the court’s declaration of bankruptcy, but can have longer-term effects on one’s financial reputation and creditworthiness.

Avoiding bankruptcy is often a key concern for individuals facing financial difficulties. There are several alternatives that can be explored to manage debt without resorting to bankruptcy:

  1. Informal Arrangements: Negotiating directly with creditors to establish payment plans or settlements that reduce the debt to a manageable level. While these are not legally binding and rely on creditor cooperation, they can offer temporary relief and a chance to improve financial standing.
  2. Debt Agreement: A binding arrangement under Part IX of the Bankruptcy Act, a debt agreement allows you to repay a portion of your debts over time, often based on affordability. It’s suitable for those who meet specific AFSA thresholds for debt, assets, and income.
  3. Personal Insolvency Agreement (PIA): For individuals with higher debt or income, a PIA under Part X of the Bankruptcy Act is a formal option. This involves appointing a trustee to manage your property and propose a repayment plan to creditors, which must be accepted by a majority in both number and value of debts. It is considered an act of bankruptcy and can lead to full bankruptcy if the proposal is not accepted.

Each of these options has its own implications and requirements, and navigating them can be complex. Consulting a bankruptcy lawyer can be invaluable in understanding these alternatives and choosing the best path for your situation. A bankruptcy lawyer can:

  • Provide expert advice on the pros and cons of each debt solution.
  • Help you understand the legal and financial consequences of each option.
  • Assist in negotiating with creditors on your behalf.
  • Prepare and lodge the necessary documentation if you decide to enter into a formal debt agreement or personal insolvency agreement.
  • Offer guidance on how to protect your assets and deal with creditors’ claims.

By seeking the right legal advice, you can make an informed decision about how to proceed and increase your chances of reaching a favourable outcome that avoids bankruptcy. A lawyer can also help you understand how each alternative might affect your future financial health, credit rating, and overall well-being.

A creditor’s petition is a legal action taken by a creditor to declare a debtor bankrupt. The creditor must prove that the debt is unpaid and the amount exceeds the statutory minimum threshold, and that the debtor has committed an act of bankruptcy.

In a creditor’s petition for bankruptcy in Australia, the statutory minimum is the minimum amount of debt that must be owed before a creditor can initiate bankruptcy proceedings against a debtor. As of the latest update prior to 2024, the statutory minimum debt amount that must be owed is $10,000.

This threshold is set by the Australian Financial Security Authority (AFSA) and is subject to change; therefore, it is always advisable to check the current threshold or seek legal advice to obtain the most up-to-date information. If a debtor owes less than the statutory minimum, a creditor cannot use a creditor’s petition to make them bankrupt.

It’s important to note that the debtor must also have committed an act of bankruptcy, typically by failing to comply with a bankruptcy notice that demands payment of the debt, within the timeframe stipulated in the notice. Once these conditions are met, a creditor can file a creditor’s petition with the court to seek a sequestration order, which, if granted, will declare the debtor bankrupt.

A liquidator, who must be a registered and qualified professional, is appointed when a company enters liquidation – the process of winding up an insolvent company. The liquidator’s role encompasses collecting and liquidating the company’s assets, investigating its financial affairs, distributing proceeds to creditors, and reporting to both the creditors and the Australian Securities and Investments Commission (ASIC).

Personal insolvency refers to an individual’s inability to pay debts and may lead to bankruptcy or alternative solutions such as debt agreements. Corporate insolvency pertains to a company’s financial distress and can lead to outcomes like voluntary administration, liquidation, or receivership.

Declaring bankruptcy is a significant legal step that involves several stages. Here’s a more detailed look at the process:

  1. Debtor’s Petition: This is the formal document an individual files to voluntarily declare bankruptcy. It includes personal details, information about your financial situation, and a declaration that you cannot pay your debts.
  2. Statement of Affairs: Accompanying the Debtor’s Petition, this document provides a comprehensive overview of your financial position. It lists all assets, debts, income, and expenses, as well as any property you own and other relevant financial information. It must be completed accurately, as errors can have legal repercussions.
  3. Filing with AFSA: Both the Debtor’s Petition and the Statement of Affairs are filed with the Australian Financial Security Authority (AFSA). AFSA oversees the bankruptcy process and ensures that all the necessary legal requirements are met.
  4. Trustee Appointment: Once your bankruptcy is accepted, AFSA will either appoint a trustee from its own staff or an insolvency practitioner of your choosing. The trustee’s role is to manage your bankruptcy, which includes selling certain assets, collecting any income contributions, and distributing the proceeds to your creditors.

A bankruptcy lawyer can assist significantly throughout this process by:

  • Advising you on whether bankruptcy is the best course of action for your situation, or if alternatives such as a debt agreement or personal insolvency agreement might be more appropriate.
  • Helping you understand the consequences of bankruptcy, including its impact on your assets, credit rating, and future borrowing capacity.
  • Assisting with the preparation and completion of the Debtor’s Petition and Statement of Affairs to ensure accuracy and completeness of the information provided.
  • Advising on the selection of a trustee and explaining their role and powers.
  • Offering guidance on your rights and obligations during the bankruptcy period.
  • Helping you navigate any legal complexities that arise during the bankruptcy process.

Engaging a bankruptcy lawyer ensures that you are fully informed of your legal position and that the bankruptcy process is handled correctly, potentially reducing the stress and uncertainty associated with declaring bankruptcy.

Please note that the information provided in these FAQs is general in nature and should not be construed as legal advice. For specific legal advice tailored to individual circumstances, it is recommended to consult with our qualified legal professional.

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