Commonwealth Numbered Acts

CORPORATIONS ACT 1989 No. 109 of 1989 - SECT 569

569. (1) Where:

   (a)  a creditor has issued execution against property of a company, or
        instituted proceedings to attach a debt due to a company or to enforce
        a charge or a charging order against property of a company, within 6
        months immediately before the commencement of the winding up; and

   (b)  the company commences to be wound up; the creditor shall pay to the
        liquidator an amount equal to the amount (if any) received by the
        creditor as a result of the execution, attachment or enforcement of
        the charge or the charging order, less an amount in respect of the
        costs of the execution, attachment or enforcement of the charge or the
        charging order, being an amount agreed between the creditor and the
        liquidator or, if no agreement is reached, an amount equal to the
        taxed cost of that execution, attachment or enforcement.

(2) Where the creditor has paid to the liquidator an amount in accordance with
subsection (1), the creditor may prove in the winding up for the creditor's
debt as an unsecured creditor as if the execution or attachment or the
enforcement of the charge or the charging order, as the case may be, had not
taken place.

(3) Subject to subsections (4) and (5), where a creditor of a company
receives:

   (a)  notice in writing of an application to the Court for the winding up of
        the company; or

   (b)  notice in writing of the convening of a meeting of the company to
        consider a resolution that the company be wound up voluntarily; it is
        not competent for the creditor to take any action, or any further
        action, as the case may be, to attach a debt due to the company or to
        enforce a charge or a charging order against property of the company.

(4) Subsection (3) does not affect the right of a creditor to take action or
further action if:

   (a)  in a case to which paragraph (3) (a) applies-the application has been
        withdrawn or dismissed; or

   (b)  in a case to which paragraph (3) (b) applies-the meeting of the
        company has refused to pass the resolution.

(5) Subsection (3) does not prevent a creditor from performing a binding
contract for the sale of property entered into before the creditor received a
notice referred to in that subsection.

(6) Notwithstanding anything contained in this Division, a person who
purchases property in good faith:

   (a)  under a sale by the sheriff in consequence of the issue of execution
        against property of a company that, after the sale, commences to be
        wound up; or (b) under a sale in consequence of the enforcement by a
        creditor of a charge or a charging order against property of a company
        that, after the sale, commences to be wound up; acquires a good title
        to it as against the liquidator and the company.

(7) In this section:

"charge" means a charge created by a law upon registration of a judgment in a
registry;

"charging order" means a charging order made by a court in respect of a
judgment.