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Liquidators conduct their professional activities under strict guidelines and parameters established under the law. Provisions of the Corporations Act 2001 (Cth) together with the standards endorsed by the Australian Securities and Investments Commission and the body of case law created by Courts, all constitute a matrix of legal principles that regulate the rights, duties, responsibilities and obligations of liquidators acting in their professional capacity.

The role of a liquidator can be highly sensitive and impose a standard of care which represents the importance of the liquidator’s function vis-a-vis the company, its directors, creditors and debtors. Tremendous care must be taken when discharging a liquidator’s powers or exercising his discretions under the law.

In the event that any activity or move is planned in respect of a company under liquidation, it is recommended that legal advice be sought so as to ensure that the liquidator does not expose himself or herself to criminal or civil liability. This is especially the case in situations where a liquidator may be uncertain about the legality or lawfulness of the proposed act or move. Problems can result in legal proceedings, which are costly and time consuming.

For more information about litigation on behalf of or against a liquidator, see our section on “Litigation Services for Liquidators.”

Registration of Liquidators

The provisions relating to the registration of liquidators are located in Chapter 9, Part 2 of the Corporations Act 2001 (Cth). Only a natural person can apply for registration, and the application is made to the Australian Securities and Investments Commission. Persons who may qualify as liquidators must satisfy preliminary requirements such as:

  • Completion of a specific period of study in commercial law at an Australian tertiary educational institute, with an earned qualification or degree;
  • Alternatively, has experience which is equivalent to the educational requirements in the opinion of ASIC;
  • ASIC is satisfied that the applicant is a fit and proper person and can perform the duties of a liquidator.

Upon registration, the liquidator will be placed on the register and he will have the obligation to maintain insurance (section 1284) and file yearly reports (section 1288). Failure to do either of these two things may result in a cancellation or suspension of the liquidator, or his or her reprimand and the requirement for undertakings to comply with the legal requirements. For more information, see our section on “Litigation Services for Liquidators” and the sub-title “Cancellation or Suspension of Liquidators.”

If you are a liquidator and you are seeking legal advice, you may wish to make an appointment with one our Bankruptcy & Insolvency Lawyers by contacting us by telephone on (02) 9233 4048 or email to info@navado.com.au. We look forward to being of assistance to you. 

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This webpage (and any material or wording appearing on this webpage) is provided for general information purposes only and does not constitute any Legal Advice. It does not take into account your objectives, your instructions or all of the relevant facts and/or circumstances. Navado accepts no responsibility to any person who relies on the information provided on this website. We further refer you to our Disclaimer.

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