Corporations Act 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .

PART 7.3B - CRISIS RESOLUTION FOR CS FACILITY LICENSEES  

Division 6 - Moratorium on action during statutory management or compulsory transfer  

Subdivision B - Stay on enforcement rights triggered by statutory management or compulsory transfer  

SECTION 843A   STAY ON ENFORCING RIGHTS MERELY BECAUSE THE BODY CORPORATE IS UNDER STATUTORY MANAGEMENT OR SUBJECT TO A TRANSFER DETERMINATION  

Stay on enforcing rights

843A(1)    
A right cannot be enforced against a body corporate for:

(a)    the reason that:

(i) the body corporate has come or is under statutory management; or

(ii) the Reserve Bank makes or has made a determination under section 837A that there is to be a transfer of shares in the body corporate; or

(iii) the Reserve Bank makes or has made a determination under section 837B that there is to be a transfer of business of the body corporate; or

(iv) the Reserve Bank gives or has given a direction to the body corporate under subsection 840A(1) ; or

(b)    the reason of the body corporate ' s financial position; or

(c)    a reason that, in substance, is contrary to this subsection or subsection (2) of this section;

if the right arises for that reason by express provision (however described) of an arrangement.

Note: This result is subject to sections 843B and 843C .

Example: A right to terminate a contract will not be enforceable to the extent that those rights are triggered by the body corporate coming under statutory management.

843A(2)    
A right cannot be enforced against a body corporate for a reason that:

(a)    is prescribed by the regulations for the purposes of this paragraph; and

(b)    relates to:

(i) section 842A applying, or possibly applying, to the body corporate in the future; or

(ii) the body corporate ' s financial position;

if the right arises for that reason by express provision (however described) of an arrangement.

Note: This result is subject to sections 843B and 843C .

843A(3)    
However, subsection (2) does not apply at a time if section 842A does not later apply to the body corporate.

Period of the stay

843A(4)    
The right cannot be enforced as described in subsection (1) during the period (the stay period ):

(a)    starting when section 842A begins to apply to the body corporate; and

(b)    ending at the latest of the following times:

(i) when section 842A ceases to apply to the body corporate;

(ii) if one or more orders are made under subsection (6) of this section for the body corporate as the result of an application made before section 842A ceases to apply to the body corporate - when the last made of those orders ceases to be in force.

843A(5)    
The right cannot be enforced as described in subsection (2) of this section during a period (the stay period ) ending at the latest of the following times:

(a)    when section 842A ceases to apply to the body corporate;

(b)    if one or more orders are made under subsection (6) of this section for the body corporate as the result of an application made before section 842A ceases to apply to the body corporate - when the last made of those orders ceases to be in force.

843A(6)    
The Court:

(a)    may order an extension of the period otherwise applying under subsection (4) or (5) of this section for the body corporate if the Court is satisfied that the extension is appropriate having regard to the interests of justice; and

(b)    before deciding an application for an order under paragraph (a) of this subsection, may grant an interim order, but must not require the applicant to give an undertaking as to damages as a condition for doing so.

Enforcing rights after the stay for reasons relating to earlier circumstances

843A(7)    
The right is unenforceable against the body corporate indefinitely after the end of the stay period to the extent that a reason for seeking to enforce the right:

(a)    is the body corporate ' s financial position before the end of the stay period; or

(b)    is any of the following:

(i) the body corporate having come or been under statutory management before the end of the stay period;

(ii) the Reserve Bank having made, before the end of the stay period, a determination under section 837A that there is to be a transfer of shares in the body corporate;

(iii) the Reserve Bank having made, before the end of the stay period, a determination under section 837B that there is to be a transfer of business of the body corporate; or

(iv) the Reserve Bank having given, before the end of the stay period, a direction to the body corporate under subsection 840A(1) ; or

(c)    is a reason, prescribed by the regulations for the purposes of this paragraph, relating to circumstances in existence before the end of the stay period; or

(d)    is a reason referred to in paragraph (1)(c) of this section or subsection (2) .

Note: This result is subject to section 843B .