THE CORPORATIONS LAW

CHAPTER 5 - EXTERNAL ADMINISTRATION

PART 5.6 - WINDING UP GENERALLY

Division 7 - Effect on certain transactions

SECTION 565   UNDUE PREFERENCE  

565(1)  [Certain payments etc void as preference]  

A settlement, a conveyance or transfer of property, a charge on property, a payment made, or an obligation incurred, before the commencement of Part 5.7B, by a company that, if it had been made or incurred by a natural person, would, in the event of his or her becoming a bankrupt, be void as against the trustee in the bankruptcy, is, in the event of the company being wound up, void as against the liquidator.

565(2)  [Relevant date]  

For the purposes of subsection (1), the date that corresponds with the date of presentation of the petition in bankruptcy in the case of a natural person is:

(a)  if the company was under official management at any time during the 6 months ending on the relation-back day - the day on which the official management commenced; or

(b)  otherwise - the relation-back day.

565(3)  [Date corresponding to date of bankruptcy]  

For the purposes of this section, the date that corresponds with the date on which a person becomes a bankrupt is the relation-back day.

565(4)  [Void transfers]  

Subject to Part 5.3A, a transfer or assignment by a company of all its property to trustees for the benefit of all its creditors is void.