Jones Partners | Insolvency & Restructuring

Merry Christmas! Jones Partners will be closed for the holiday season from Monday 23rd December 2024, reopening on Monday 13th January 2025. We wish you and your loved ones a joyful and safe Christmas, and we look forward to working together in 2025.

Explained: Deed of Company Arrangement A Deed of Company Arrangement (DOCA) is a proposal to recapitalise and restructure a company's financial affairs. A DOCA aims to maximise a company’s chances of survival and provide a better return to creditors than an immediate liquidation. All DOCA proposals are evaluated by the company administrator, who also assesses the company’s commercial viability, ultimately making a recommendation to creditors regarding the future of the company. For the DOCA proposal to become binding, 50% of creditors both in value (debt owed) and number must vote in favour. A DOCA must also ensure that employee entitlements are paid in priority to other unsecured creditors, and that employees are no worse off than an immediate liquidation. #voluntaryadministration #jonespartners

Advice for Directors on Personal Guarantees during Liquidation A personal guarantee is a legally enforceable promise (made by a natural person) to fulfil a third party’s obligations – such as those of a company – if it is unable to do so. When a company enters liquidation, these guarantees are typically triggered, making directors personally liable for the company’s outstanding debts. Personal guarantees enable creditors to pierce the corporate veil and hold directors to account. But how (if at all) can a liquidator assist in navigating this situation? Click the link below to find out.  https://lnkd.in/guY6ZGGJ #insolvency #jonespartners 

Click on the link below to hear a brief message from Managing Partner, Michael Jones, about Jones Partners. https://lnkd.in/gg5U3EVR #jonespartners

4 Tips to Keep the Grinch (Liquidator) Away This Christmas Christmas is a joyous time, but for small business owners, it can also be a high-stakes, anxiety-inducing period. Future financial viability often depends on this seasonal influx in revenue. Unexpected challenges can significantly increase the risk of insolvency. Preparation is key. This article highlights four essential tips to help businesses avoid a visit from the liquidator this silly season.    Click the link below to read more. https://lnkd.in/gEmxn52Z #insolvency #jonespartners 

Bankruptcy: Overview and Benefits   If an individual has evaluated all the options to overcome insolvency, and has not been able to find a solution, they may have to consider filing for bankruptcy. This usually occurs if a creditor seeks a sequestration order from the court, or where a person declares themself bankrupt voluntarily, by completing and lodging the necessary forms. The benefits include: • Ensuring a fair and equitable distribution of the estate to creditors; • Enabling the distressed individual to gain immediate relief from the pressure of all creditors and make a fresh start; and • Allowing for an investigation into the financial affairs of the distressed individual with the purpose of identifying transactions that can be set aside. The best way to navigate financial distress will depend on the unique circumstances of the individual. Consultation with a qualified insolvency professional is highly advisable.   #bankruptcy #jonespartners

Defences to Insolvent Trading Did you know in certain circumstances directors can be protected from insolvent trading? Whilst Section 588(G)(2) of the Corporations Act 2001 ordinarily provides that directors will be personally liable for debts that are incurred whilst they are a director if certain conditions are met, safe harbour provisions in Section 588GA of the Corporations Act effectively provide directors with a form of defence or exception in certain circumstances. A “better outcome” test is an important consideration in the safe harbour provisions. Critical in this assessment will be evaluating the ability of the business to comply with the safeguard areas of employee and tax reporting obligations. Early intervention is key. The sooner you suspect your company may be approaching financial difficulty (and action is taken) the better the level of protection. www.jonespartners.net.au #safeharbour #jonespartners 

What is a Section 66G Appointment? A Section 66G Appointment refers to a mechanism under the Conveyancing Act 1919 (NSW) that allows for the appointment of statutory trustees to resolve disputes regarding co-owned property. This process is particularly useful when co-owners cannot agree on the sale, division, or management of the property. Appointment of a Trustee is usually made in respect of an application to the Court by one of the joint owners of real estate, outlining the nature of the dispute with the other co-owner so that a Trustee can be appointed to take charge regarding the sale of the real estate. Taking possession of the real estate makes the sale process easier. Any secured debts and the costs of sale are paid out on settlement and the resulting surplus is then held on statutory trust for the co-owners. Call us now on +61 2 9251 5222 to arrange a no obligation discussion to help you with a strategy to unlock the value in your real estate. #jonespartners #distressedrealestate 

Directors and Personal Guarantees Have you been required to give guarantees in relation to the conduct of the company? They can typically be required where leases and trade accounts are involved. It is important to recognise that should a company encounter financial difficulty, then ultimately these guarantees could be called upon which can expose you personally to pay the debts incurred by the company. Jones Partners regularly assist directors in understanding the likely ramifications should this occur. We take a proactive role in working with directors to achieve practical solutions when considering and giving guarantees. In addition, we also work closely with other professionals to develop sound strategies regarding structuring of a company and director’s affairs from inception. There are obviously other areas of consideration for directors. Whilst we believe that careful consideration should be given to being appointed a director, we also recognise that certain events can occur during a company’s life cycle which sometimes are outside of the director’s control. We seek to provide directors with the practical advice and solutions required in an ever changing and dynamic regulatory environment. #jonespartners

The Benefit of PIAs for Creditors Personal Insolvency Agreements (PIA) are outlined in Part X (Part 10) of the Bankruptcy Act 1966 (Cth), offering distressed individuals a flexible way to manage their debt and regain control of their finances. A PIA proposal will usually outline the sale of assets and payments to creditors over a period of time. It can alternatively include a lump sum payment. There are several general benefits for creditors: 1.    Commerciality A PIA may offer a better return to creditors. In bankruptcy proceedings, assets are sometimes liquidated at a discount and subject to administrative and trustee costs. A PIA outlines a clear timeline for what is owed and when it will be paid. It also avoids costly court processes. 2.    Protect ongoing business relationships A personal insolvency agreement empowers a debtor to remain in control of their financial affairs or business. This flexibility can protect the ongoing business relationship between a creditor and debtor. 3.    Expediency In bankruptcy proceedings, creditors will sometimes face extensive delays before receiving payments. Payments for a PIA usually commence shortly after the proposal is accepted. #personalinsolvencyagreements #jonespartners