The world of insolvency is currently undergoing serious review, with potential reforms flying around thick and fast. But talk of safe harbours and unenforceable ipso facto clauses (see our update here) have overshadowed a significant development that commenced on 1 March 2017: the ability for external administrators1 to now assign their rights to sue under the Corporations Act 2001 (Cth) (Corporations Act).
The Insolvency Law Reform Act 2016 (Cth) (Insolvency Act) recently amended the Corporations Act by adding a new schedule: Schedule 2 – Insolvency Practice Schedule (Corporations) (Schedule). The right to sue for claims such as insolvent trading or voidable transactions, previously personal to external administrators, can now be assigned pursuant to section 100-5 of the Schedule.