Collect your debts from an insolvent debtor

Get the best possible recovery from a debtor who cannot pay.

When a debtor becomes insolvent, creditors who act promptly and strategically consistently recover more than those who wait. The tools available, including statutory demands, winding up petitions, bankruptcy petitions, and active participation in formal insolvency processes, each carry different timeframes, costs, and likely returns. We advise creditors on the most effective pathway for their specific situation, taking into account the debtor’s asset position, the conduct of any insolvency practitioner, and the realistic return at each stage of the process.

What are your options as a creditor when a debtor is insolvent?

When a debtor cannot pay its debts, ordinary enforcement mechanisms such as garnishee orders and writs of execution often become ineffective. Formal insolvency law provides a different set of tools: creditors can apply to wind up a company, petition to bankrupt an individual, or participate in an existing insolvency process as a registered creditor. The rules governing creditor rights in these processes, including priority, proof of debt, voting, and distributions, are set out in the Corporations Act 2001 (Cth) and the Bankruptcy Act 1966 (Cth). Understanding which pathway applies and how to use it effectively is often the difference between recovering something meaningful and recovering nothing.

Can I still recover my debt after a company goes into liquidation?

Yes, but your recovery is limited to your pro rata share of the assets available to unsecured creditors after secured creditors and priority creditors such as employees are paid. To participate in any distribution, you must lodge a formal proof of debt with the liquidator before the relevant deadline. The realistic return to unsecured creditors varies widely and depends entirely on the assets the liquidator is able to realise.

What is a statutory demand and how does it help me recover my debt?

A statutory demand is a formal written demand served on a company debtor under the Corporations Act 2001 (Cth) requiring payment of an undisputed debt of at least $4,000 within 21 days. If the company fails to comply, it is presumed insolvent and you can apply to wind it up. The threat of winding up often prompts payment in cases where ordinary debt collection has failed, and if it does not, the winding up process begins the formal recovery mechanism.

What if a voluntary administrator has already been appointed?

Once a voluntary administrator is appointed, there is an automatic moratorium on most creditor enforcement action. You should lodge your proof of debt with the administrator promptly. You will be entitled to vote at the meeting of creditors on the company’s future, whether to proceed to a deed of company arrangement, liquidation, or return control to the directors. Your vote is proportional to your debt, so lodging accurately matters.

What if I think the insolvency practitioner is not doing their job properly?

Insolvency practitioners are regulated by ASIC and owe duties to all creditors collectively. If you believe a practitioner is not pursuing available recoveries, is charging excessive fees, or is acting improperly, creditors have mechanisms to challenge their conduct, including applying to the court, complaining to ASIC, or seeking the appointment of a reviewing liquidator. We can advise on which mechanism is appropriate and the prospects of a successful challenge.

Understand your realistic recovery.

Take the right first step.

Protect your position throughout.

Find out what you can actually recover before the asset pool shrinks further.

In an insolvency, time directly affects recovery. Assets are dissipated, limitation periods expire, and the pool available to creditors shrinks. Getting advice now costs far less than discovering later that action could have been taken.

Every day without a strategy is a day the asset pool shrinks.

You are owed money by a debtor who appears to be insolvent, and you have no clear idea whether you will recover anything or how to position yourself to recover as much as possible. Meanwhile, other creditors may already be taking steps that will affect your position, and time is working against you.

We will assess the debtor's insolvency position and advise on the recovery options available to you.
We will advise on whether to issue a statutory demand, file a winding up or bankruptcy application, or lodge a proof of debt in an existing insolvency.
We will help you register your debt in any formal insolvency process and ensure your interests are properly represented.
We will advise on whether the insolvency practitioner is fulfilling their obligations and challenge their conduct where appropriate.
We will pursue voidable transaction claims where the facts support them.

You are owed money by a debtor who cannot or will not pay.

You have been supplying goods or services to a debtor for some time and the debt has grown to a point where it is causing real damage to your business. The debtor has stopped responding to invoices and calls, you have heard through the industry that they are in financial trouble, and you are worried about being left empty-handed. Other creditors may already be moving. You need to know whether there is any realistic recovery and, if so, how to position yourself at the front of the queue.

What's included in your insolvency creditor recovery service

Debtor insolvency assessment and recovery strategy advice.
Statutory demand preparation and service.
Winding up or bankruptcy petition assistance.
Proof of debt lodgement and creditor participation.
Insolvency practitioner conduct review and challenge advice.

What passive creditors lose by waiting.

Creditors who take a passive approach to an insolvent debtor regularly receive less than they would have with earlier, targeted action. Assets that could have been preserved are dissipated. Preference claims that could have been challenged expire. Proof of debt lodgements that are poorly drafted or filed late are rejected. Insolvency practitioners, who work for all creditors collectively, do not always pursue every avenue available if it involves contested litigation at the estate’s cost. In an insolvency, the creditors who participate actively and take independent advice on their rights are consistently better positioned than those who simply wait for a dividend.

Here is how we improve your recovery position.

We establish a clear picture of the debtor’s financial position, including any assets, related-party transactions, and prior dealings, and advise you on the realistic recovery prospects before committing to any formal step. Where a formal insolvency process has already started, we review the practitioner’s reports and advise on whether the process is being managed properly, whether any claims are being overlooked, and whether your proof of debt has been correctly lodged and accepted. Where no formal process has started, we advise on the best trigger and execute it correctly, ensuring your position in the creditor pool is established as early as possible.

How we maximise your recovery.

From assessment to distribution.

Assess the position.

We review the debtor's financial situation, any existing insolvency process, and the debts involved, and advise on the realistic options and likely return before you spend money on recovery action.

Take recovery action.

We execute the chosen strategy, issuing a statutory demand, filing a petition, or lodging your proof of debt, and monitor progress throughout.

Maximise your return.

We scrutinise the insolvency practitioner's conduct, challenge any distributions that appear incorrect, and pursue voidable transaction recoveries where the facts support it.

Experienced insolvency creditor lawyers who know how to maximise recovery.

We understand how frustrating it is to watch a debt that should have been recoverable become a write-off because the right steps were not taken at the right time. Our lawyers have acted for creditors across all stages of corporate and personal insolvency, from the initial statutory demand through to creditor meetings, contested winding up proceedings, and preference claim litigation. We know how insolvency practitioners operate, what questions to ask, and when to push back.

We understand you want to know the cost, before we get started.

We will map out our process, from beginning to end, so you know what the journey will look like before you get started.

We will provide you with a clear and detailed Work Proposal covering each step along the way.

Our fair fees are all-inclusive. No hidden costs for telephone calls, emails, photocopying, couriers, or coffee.

Our great lawyer guarantee

We want to be part of your team over the long term. We achieve this by adhering to these core principles:

Take the time

We listen carefully to understand what you want to achieve. Then we thoroughly explain our advice and step you through the documents. You can be sure you know the full consequences.

Share our knowledge

We will pass on as much knowledge as we can, so you can make your own informed decisions. We want to make you truly independent.

Stick to our knitting

We only do what we're good at. You can be confident that we know what we're doing and don't pass on the cost of our learning.

Work as one team

Someone will always be available to answer your questions, or point you in the right direction. You will also benefit from a range of perspectives and experience.

Fair pricing

For advice and documents, we provide a fixed or capped quote so you don't take price risk. If you're in a dispute, we map out the process and costs so you know what to expect.

It's your show

We're not in this for our egos. We're in it for a front row seat to witness your success.

Get the best recovery available to you.

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