Legal support for voluntary administrators
We work to your timetable, so the notices, the report and the deed are right the first time.Voluntary administration is the appointment with no room in it. You take control of a company you have never seen, work out what it is actually worth, form a view on whether it can be saved, and put a recommendation to creditors that will bind them. The whole thing runs in about a month, and there is no second attempt at a report to creditors that was wrong. The timetable in the Corporations Act 2001 (Cth) (the Act) is what makes the role hard, rather than the law sitting inside it. So what an administrator needs from a lawyer is turnaround: advice that arrives in time to change what you do.
The report checked first
A review before the report to creditors goes out is the cheapest hour in the administration and covers the document you are most exposed on.
Notices that cannot be attacked
Meeting notices are checked before they are sent, because a defective one puts the conduct of the whole administration in play.
Advice inside your dates
Everything is worked to your timetable, since advice that arrives after a deadline changes nothing.
What makes voluntary administration harder than it looks?
Voluntary administration gives an insolvent company a short period of protection while its creditors decide its future, which is a deed of company arrangement, liquidation, or control returned to the directors. The administrator takes full control, convenes two creditors’ meetings inside a compressed timetable, investigates the company’s affairs, and reports to creditors with a recommendation. The difficulty is that the investigation and the report both fall due before anybody could comfortably finish either. Under the Act the meeting notices, the report and the deed each carry requirements that are unforgiving, and there is rarely time to correct a step once it has been taken.
What is a deed of company arrangement?
A binding arrangement between a company and its creditors, negotiated during the administration, under which the company keeps operating and pays creditors an agreed return. It is voted on at the second meeting and binds all unsecured creditors if it passes. The terms vary widely, and the test creditors apply is whether it beats what a liquidation would return.
Can the directors challenge the administration?
Directors who made the appointment have limited scope to unwind it, but the court can terminate an administration where the company is not actually insolvent, where the appointment was made for an improper purpose, or where creditors’ interests require it. If a challenge arrives, it needs a response quickly, because the timetable keeps running through it.
How are related-party votes treated at the second meeting?
They count, but they attract scrutiny. Where a resolution passes only because related creditors voted for it, the court can set the result aside on the application of another creditor. The safeguard is to identify the related claims before the meeting and record how the vote was conducted, rather than dealing with it once the objection has been made.
What if the report to creditors turns out to be wrong?
That is the exposure the role carries, which is why the report repays a close review before it goes out. Creditors rely on the recommendation, and an administrator who overstates a return or omits something material can be personally liable. A short review before issue is far cheaper than the alternative.
Get advice before the first meeting, not after it
The first few days set up everything that follows. If you are taking an appointment where the directors are unhelpful, the records are thin, or a secured creditor already has firm views, a conversation now is worth more than any amount of advice after the notices have gone out.
There is no room in the timetable to fix a step you got wrong
You have taken an appointment that is more complicated than the directors described it, and the first creditors’ meeting is days away. The records are incomplete, at least one creditor has lawyers and is applying pressure, and a secured creditor holds a firm view about the outcome. You have to reach a recommendation that binds every unsecured creditor on evidence you have not finished gathering, and the exposure for a report that turns out to be wrong is yours.
- We will map the timetable against the specific legal risks in your appointment.
- We will check the meeting notices and review the report to creditors before it is issued.
- We will advise on the conduct of the meetings and the voting, including related-party votes.
- We will draft and negotiate the deed of company arrangement where one is proposed.
- We will respond to challenges from directors, creditors or other parties while you keep administering.
You took control on Monday and the picture changed by Wednesday
The directors approached you and presented the administration as reasonably straightforward. Within days of taking control it is not. Related-party transactions raising questions you cannot yet answer. A secured creditor with strong views and the leverage to act on them. An unsecured creditor who has retained lawyers and now writes to you weekly. The first meeting is this week, and the report to creditors falls due well before you will have the records you need to write it properly.
What's included in your voluntary administration legal support service
- Timetable and risk mapping at appointment.
- Creditors' meeting notices, agendas and conduct advice.
- Review of the report to creditors before it is issued.
- Deed of company arrangement drafting and negotiation.
- Court applications and creditor challenge response.
Where an administration comes apart
Administrations fail on procedure more often than on judgement, because the timetable leaves no margin. A defective notice of the first meeting hands creditors a ground to challenge the conduct of the whole administration. A report to creditors that is incomplete or overstated is the document an administrator is personally exposed on, and it is also the one creditors read most closely.
A deed of company arrangement that does not meet the Act’s requirements is not a deed, which tends to be discovered after everyone has relied on it. Decisions about voting, particularly where related parties are voting, get set aside by a court if they were made without a proper basis. None of these are failures of understanding. They are what happens when a step has to be taken before the material supporting it has arrived, and there is no time left to go back over it.
From an appointment under pressure to an outcome that holds
We start at appointment with the timetable and the specific risks in this company. The related-party questions, who is voting and with what, where the secured creditor’s position actually sits, and which parts of the investigation have to happen first because the report depends on them.
Then we work to your dates. Meeting notices checked before they go out. The report to creditors reviewed before it is issued, which is the single most useful hour in the administration. Advice on the voting, including related-party votes and the casting vote, given before the meeting rather than afterwards. Deed drafting and negotiation where a deed of company arrangement is on the table. And if a director applies to the court or a creditor challenges a meeting outcome, we take that on while you keep administering.
How we work to your timetable
From the appointment through to the deed or the winding up.Before the first meeting
We map the timetable and the risks in this appointment, check the meeting notices, and tell you which parts of the investigation have to happen first.
Build the report
We advise through the investigation and review the report to creditors before it is issued, including the recommendation and how it is supported.
Land the outcome
We advise on the voting, draft and negotiate the deed of company arrangement, and deal with any challenge to the meeting outcome.
Turnaround that matches the timetable you are working to
What makes voluntary administration difficult is not the legal test. It is being asked to reach a defensible view about a business in a few weeks, using records somebody else kept badly, while the people who kept them have an interest in the answer you land on.
One of our lawyers holds the ARITA Advanced Certificate in Insolvency and is a member of the Australian Restructuring Insolvency and Turnaround Association. We have supported administrators through contested deed proposals, director applications to the court, and second meetings where the outcome was genuinely in doubt. We also understand that advice arriving after a deadline is not advice, so we work to yours.
Our great lawyer guarantee
Six principles we hold to, whatever you bring us and however long it takes.
Take the time
We listen carefully to understand what you want to achieve, then step you through the advice and the documents.
Share our knowledge
We pass on as much as we can, so you can make your own informed decisions.
Stick to our knitting
We only do what we are good at, so you never pay for our learning.
Work as one team
Someone is always available to answer your question or point you the right way.
Fair pricing
A fixed or capped quote for advice and documents, so you do not carry the price risk.
It is your show
We are in it for a front row seat to witness your success, not for our egos.
Get support that keeps up with the appointment
Tell us about the appointment and where the first meeting sits. We will map the timetable against the risks in this company, check the notices before they go out, and review the report to creditors before it is issued, so the steps you take this week are not the ones that get challenged later.
More on this area of law
Read more about voluntary administration, deeds of company arrangement and corporate restructuring, and how ADLV Law can help.