Legal ramifications of insolvency

In these troubled times, anyone involved in a business needs to understand the legal implications of different scenarios that might affect companies in a precarious financial position. Further legal advice is desirable, not least to consider how to take advantage of additional opportunities that may present themselves in the market place because a customer or supplier or a competitor look like going broke. A company experiencing serious financial difficulties may be subject to one of the regimes created by the Corporations Act 2001 to deal with insolvency. This article examines rights and potential liabilities of directors, creditors and members under each regime.

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