Corporations Act 2001

CHAPTER 5 - EXTERNAL ADMINISTRATION  

PART 5.1 - ARRANGEMENTS AND RECONSTRUCTIONS  

Note: This Part applies to CCIVs with modifications: see Division 2 of Part 8B.6 .

SECTION 415F   ORDER FOR RIGHTS TO BE ENFORCEABLE ONLY WITH LEAVE OF THE COURT  

Orders

415F(1)    
The Court may order that one or more rights under a contract, agreement or arrangement are enforceable against a body only:

(a) with the leave of the Court; and

(b) in accordance with such terms (if any) as the Court imposes.

Example: The order could be sought for a right to terminate for convenience.

415F(2)    
The Court may make the order (the stay order ) if:

(a) the body is the subject of any of the following:

(i) an announcement referred to in paragraph 415D(1)(a) ;

(ii) an application under section 411 (the section 411 application );

(iii) a compromise or arrangement approved under this Part as a result of a section 411 application; and

(b) the Court is satisfied that:

(i) the rights are being exercised; or

(ii) the rights are likely to be exercised; or

(iii) there is a threat to exercise the rights;

because of one or more reasons referred to in paragraphs 415D(1)(a) to (f); and

(c) an application for the stay order is:

(i) if the body has made an announcement referred to in paragraph 415D(1)(a) , but not yet a section 411 application - made by the body; or

(ii) if the body has made a section 411 application, but a resulting compromise or arrangement is yet to be approved under this Part - included in the section 411 application; or

(iii) if a compromise or arrangement has been approved under this Part as a result of the section 411 application - made by the person appointed to administer the compromise or arrangement; and

(d) in a case where the body has made a section 411 application - the section 411 application states it is being made for the purpose of the body avoiding being wound up in insolvency.

415F(3)    
A stay order must specify the period for which it applies. In working out the period, the Court must have regard to:

(a) subsections 415D(2) , (3) and (4) ; and

(b) the interests of justice.

415F(4)    
Subsection (1) does not apply to a right referred to in subsection 415D(6) or (8) .

Interim orders

415F(5)    
Before deciding an application for a stay order, the Court may grant an interim order for one or more rights under a contract, agreement or arrangement not to be enforced against a body.

415F(6)    
The Court must not require an applicant for a stay order to give an undertaking as to damages as a condition of granting an interim order.