Voluntary administration

Fast track sales involve the voluntary administrator selling the assets of a business during a voluntary administration, instead of recommending a debt compromise or ‘Deed of Company Arrangement’. While a fast track sale in a voluntary administration is legal, it is relatively uncommon in Australia. Here we explain how fast track sales work, and consider whether they are a desirable feature of Australian insolvency law. If it occurs, company directors may feel betrayed by a voluntary administrator if they are expecting a debt restructure through a ‘Deed of Company Arrangement’.

Once the DOCA is being administered, there is no longer a moratorium on ‘ipso facto’ clauses. In short, this allows suppliers, landlords and other creditors with suitable contracts to immediately terminate those contracts on appointment of the deed administrator.