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10th Anniversary Annual Practical Insolvency Conference & Gala DinnerMonday, 28 March – Tuesday, 29 March 2011 (Gala Dinner - Monday, 28 March)

Optional Workshop – Wednesday, 30 March 2011Dockside, Cockle Bay, Sydney

Note: Registration opens 8.00amConference: Monday, 28 March – Tuesday, 29 March 2011Workshop: Wednesday, 30 March 2011 from 9.30am – 3.30pmConference starting time: 8.50am Day one and 9.00am Day twoFinish Times: 5.45pm Day one and 4.00pm Day twoGala Dinner: Monday, 28 March - 7pm for 7.30pm

DAY ONE – MONDAY, 28 MARCH 2011

8.50 – 9.00 OPENING REMARKS from the ChairRichard Fisher AM, General Counsel and Adjunct Professor, Graduate School of Government, University ofSydney

9.00 – 9.30 AUSTRALIAN TAXATION OFFICE INITIATIVES 2011I've invited Ross Burns, ATO Director, Complex and Strategic Recovery, to provide an update on three veryimportant ATO initiatives:

• Attaching proceeds of sale – My 2009 conference included a paper on section 260-5 notices (please letme know if you'd like a copy, with my compliments), which create a fixed charge over assets - but will notof themselves defeat a prior registered charge. Ross will discuss the ATO's use of these statutorygarnishees - not to create a charge over an asset, but instead to intercept the proceeds of sale of thatasset.

• Outcomes (or possible outcomes) from recent court developments.

• Provision of security - the ATO has the power to demand payment of a bond or provision of security from acompany where there may be a risk that a tax liability not be paid - failing which the company will not beregistered. Potentially this will become a very significant anti-phoenix weapon but it will have applicationsin a wide range of other circumstances as well.

• Director penalty provisions - Ross will provide an update on a range of legislative enhancements to theDirector Penalty Notice regime which imposes personal liability on company directors unless they placetheir companies into an insolvency administration. What will this mean for practitioners and financiers?

Ross Burns, Director, Complex and Strategic Recovery, Australian Taxation Office

9.30 – 10.40 STATE OF THE MARKET – from the Banks’ PerspectiveOne Senior Banker says “2011 = The Year of the Receiver. The collapse of Bear Stearns/Lehmans and theoverall GFC occurred almost 3 years ago. No more excuses. Multi speed economy”.

• 2011/12 Refinance Risk - diminishing bank balance sheets. Debt capital markets still constrained.• The impact of BASEL 3 on a bank's strategy/preparedness to work through a situation/turnaround?• Review of the market in 2010: where did the work go….and why?• How was 2010 different to 2009…and how will 2011 be different from 2010?• Likely geographic and industry hotspots in 2011• What should IPs do to get ahead of the curve?• Key trends and best practice• What does a bank look for in making adviser appointments for particular files/situations.

A panel of senior representatives from the profession and key financial institutions will provide their viewsChaired by Luke Targett, Partner, PKFRick Drury, General Manager, Strategic Business Services, National Australia Bank LimitedBrett Perry, General Manager, Credit Risk Solutions, Commonwealth BankRoss Burns, Director, Complex and Strategic Recovery, Australian Taxation OfficeGwyn Morgan, Executive Director & Head of Credit & Asset Structuring, Westpac Institutional Bank

10.40 – 11.00 Morning Tea

Concurrent Sessions:11.00 – 12.20 Stream 1:IN THROUGH THE OUT DOOR - OR OUT THROUGH THE IN DOOR? A PANEL ON DISTRESSED DEBT TRADINGLed by John Nestel, Partner, Freehills

Over the last twelve months there has been a stream of transactions in which major trading banks have sold their debt ata considerable discount - Notable examples are Centro, Alinta, Rivercity and Imed.

I've asked John to help us understand how it is that the Hedge Funds, Investment Banks and Opportunity funds can havesuch a different view on value - entering at prices that the trading banks appear to be happy to take on exit. Referencingrecent transactions the panel will address these questions:

• How the Hedgies assess value? • Will you know if a non-bank is involved? Can you (should you?) protect against "fronting banks?" • How do the Hedgies create value - just what is "loan-to-own"? • Is the different risk appetite due to the absence of Basel III restrictions, the ability to create deals by

committing equity, or a different approach to restructuring? • Short term debt trading versus hold-to-restructure • How will the trading banks work alongside the Hedgies? • Winners and losers so far

John Nestel, Partner, Freehills and a panel of financiers and debt specialists.Ross Griffiths, Chief Credit Officer, Commonwealth BankChris Wyke, Managing Director, Moelis & CompanyGeorge Wang, Director, Deutsche Bank AGMerrick Howes, Managing Director, Anchorage Capital

11.00- 11.40 Stream 2:FUTURE DIRECTION OF INSOLVENCY PRACTITIONER REGULATION – update and panel discussion

We now have the Senate Inquiry’s final report into the profession and its regulation• How has ASIC responded?• How should our regulators respond…how have they responded? What does the future hold?• Is the expectation gap (the difference between what creditors want and what IPs can deliver)

inevitable?• IPA/Profession View• Be ready for change!

Led by Stefan Dopking, Partner, Taylor Woodings – a panel comprising senior practitioners from legal,accounting & industry to review future issues for the profession including:Denise North, CEO, IPAKate Barnet, Director, Bentleys Corporate Recovery

11.40 – 12.20 Stream 2 CONTINUEDPRACTITIONER REMUNERATION and EXPENSES

• Q: A liquidator may never exercise a casting vote in favour of her or his own remuneration – True or False?A: see Williams v CD Protective Services Pty Ltd & Ors (No 3)!

• Pleash & Anor v Gold Coast Property Investments & Management Pty LtdAdministrators took their claim for remuneration to Court for approval after creditors refused to fix theremuneration. A bank objected to the remuneration claim arguing that the hourly rates and the hours billedwere excessive, travel expenses were unnecessary and the proportion of time spent by the administratorspersonally was excessive.

• Paul's Retail Pty Ltd v MorganDoes a resolution which approves fees to a capped amount impose an absolute maximum on the amount thatmay be charged?

• Re Wings-Aus Holdings Pty Limited (in Liquidation):- Is an administrator entitled to satisfy his s 443D lien before accounting to a liquidator?- Must remuneration be first fixed under s 449E in order to enforce that lien?

• ACN 099 735 476 Limited (in liq) v Didasko Learning Institute Pty Ltd

Under a contract for sale the buyers of a business were responsible for defined “trading liabilities” and were notsubrogate to the administrators’ statutory and equitable rights of indemnity and lien

Scott Hedge, Partner, Kemp Strang

12.20 – 1.20 Lunch

1.20 – 2.00 DUTIES WHEN SELLING ASSETS….SECTION 420A AND MORE

This year we will look at:• Permanent Custodians Ltd v AGB Developments Pty Ltd - Guarantors argued that section 420A

conferred a right to recover damages and that a creditor had an obligation to act in the best interests of asurety.

• Reynolds & Reynolds v Aluma-Lite Products Pty Ltd - A borrower argued that assets had beenincorrectly advertised, that potential purchasers had been refused the right to inspect property, and thatthe agent had ‘talked the property down’.

• Perpetual Trustee Limited v Baranov – a borrower argued that a lender had failed to sell property forthe best price reasonably obtainable and argued that Nolan v MBF Investments meant that a mortgageewith security over multiple properties was required to realise security so that the sale of a family home wasavoided unless necessary.

• Kravchenko v The Rock Building Society – A lender sold a property to an employee of the solicitorshandling the mortgagee sale purchased the property at for $5,000 more than a recent valuation rather thanput the property to public sale as first planned.

• Apostolou v VA Corporation Aust Pty Ltd [2010] FCA 64A mortgagee sold a property for significantly in excess of the valuation it obtained – however the borrowerargued that the outcome only highlighted the inadequacy of the valuation and did not demonstrate aneffective sale process

Amber Warren, Partner, Banking Litigation, Insolvency, Gadens Lawyers

2.00- 2.40 RETENTION OF TITLE & PERSONAL PROPERTY SECURITIES & LATEST AMENDMENTS

Robert Newlinds SC will review a number of recent cases as well as providing a overview on the interplay between thePPSA and retention of title.

Cases under review include:

• Perron Investments Pty Ltd v Tim Davies Landscaping Pty LtdA sub-contractor submitted a tender on conditions which included a retention of title term. After the headcontractor was liquidated the sub-contractor lodged caveats on the property on which the work was donearguing that the architect who supervised the project had agreed to the retention of title clause as agent for theowner.

• Traianedes v Mercury Brands Group Pty LtdA company had provided finance to another company by purchasing stock, and claimed ownership of the debtscreated when that stock was sold by the company to its customers. The fund was also claimed by a bankwhich said that that the invoices were caught by its floating charge.

• Toveill Pty Ltd v Australian Quality Plus Pty Ltd; Joe's Citrus Pty Ltd v Australian Quality Plus Pty LtdA supplier argued that its (fairly standard) retention of title clause created a ‘Quistclose’ or special purpose trustover the proceeds of sale which therefore did not require registration as a charge.

• LMC Caravan GmbH & Co KG v GE Commercial Corporation (Australia) Pty LtdA supplier sold caravans to a dealer subject to a retention of title clause. The dealer sold those caravans into afloorplan finance arrangement. When the floorplan provider sent payment for a large consignment it did notidentify which caravans were being paid for. The dealer did – but provided details that were not consistent withthe details it provided to the floorplan provider.

Robert Newlinds SC

2.40 – 3.10 RESERVATION OF RIGHTS (BANKING TOPIC)

In practice lenders will often decide not to enforce their security in response to an event of default. Where this occursthey will typically issue a formal notice to confirm that such non-action does not constitute a legal waiver of the right toenforce.

In Victor Seeto & Ors v Bank of Western Australia Limited a borrower argued that the event of default upon which areceivership appointment was based simply did not exist. The lender then turned to previously identified but reservedevents of default to support the position.

Using Seeto as a case study, our speaker will review the effectiveness and use of ‘reservation of rights’ notices, whetherthere may in practice be a limit outside which they should not be relied upon, and the practical steps necessary to ensurethat lender conduct does not undermine the position taken in formal notices.

Philip Hoser, Partner, Jones Day

3.10 – 3.20 Afternoon Tea

3.20 – 4.20 A review of some of the current ‘hold strategies’ being developed in the market, including debt forequity conversion, convertible note and warrant structures, and loan to own, from both the legal and financialperspectives. (session wording tbc)

Panel led by : Dominic Emmett, Partner, Corrs Chambers Westgarth

Including panellists:Stuart King, Head of SBS Equity, Strategic Business Services, National Australia BankSteve Sherman, Partner, Ferrier HodgsonEdward Cairns, Head of Restructuring, Clearwater Capital Partners

4.20 – 5-45 MANAGED INVESTMENT SCHEMES – PANEL SUPER-SESSIONMy senior banking sources all inform me that MIS are still a hotspot and this session will look at the interestingissues relating to the differing structures.Legal position and rights/interests of growers/investors.The bank's position as secured lender and sometimes lender to the investors.Dealing with an insolvent MIS

• Obligations of Responsible Entities• Ability to collapse structures• Ability to collapse leases• Grower’s Rights/Rent issues• Dealing with stakeholders• What are the different approaches that can be taken?• Potential legislative changes under CAMAC’s review• Timbercorp• FEA Group• Willmott• Great Southern

Chaired by Philip Crutchfield SCPanel organised by Ian Copp, Head of Specialised Lending Services, Risk Management, Commonwealth BankTim Williams, Head of Group Strategic Business Services, Melbourne, Group Risk, National Australia Bank LimitedClint Hinchen, Partner, Allens Arthur RobinsonBrendon Watkins, Partner, Minter EllisonBryan Webster, Partner, KordaMenthaIan Carson, Partner, PPB Advisory

7.00 FOR 7.30 - 10th anniversary GALA DINNER, DOCKSIDE Sponsored by:

DAY TWO – TUESDAY, 29 MARCH 2011

9.00 - 9.40 ANNUAL BANKRUPTCY UPDATE FOR PERSONAL & CORPORATE PRACTITIONERSTRUSTS AND POWERS OF SALE• Partition orders - can the Federal or Federal Magistrates Court make them?• A comparison of the Western Australian decision in Anderson v Pongas [2011] FMCA 54 and the

Queensland decision Park v Barclay [2010] FMCA 397.• Is there jurisdiction under the Bankruptcy Act to appoint Trustees for Sale and make an order for

possession or is it the provence of the State Courts alone?• Time limits and delay – estoppels arising by conduct.• Revisiting O’Brien v Sheahan [2002] FCA 1292.• Trusts – A right of indemnity under the Trust Deed and at law, section 59(4) Trustee Act, 1925 (NSW) –

what about other States ?.• Trusts that fail – shams and alter egos of the bankrupt, is it time to revisit sections 139A – 139H?• A hypothetical.• Wily v Burton [1994] 126 ALR 557 decided that the power to remove a trustee was not divisible property.

Will the High Court review this law in light of the comments of French J when he was on the Federal Courtin Richstar Enterprises [2006] FCA 433.

Sally Nash, Principal, Sally Nash & Co Lawyers

9.40 – 10.20 APPLICATIONS BY INSOLVENCY PRACTITIONERS TO THE COURT FOR DIRECTIONS• Inherent jurisdiction to assist officers of the court• Statutory provisions• Is the court obliged to give directions?• General principles• Commercial decisions• Adversarial matters• Re Mento Developments (Aust) Pty Ltd (in liquidation) (2009) 73 ACSR 622

Peter Agardy, Barrister, Melbourne

10.20 - 10.40 Morning Tea

10.40 – 11. 20 TAKING ACTION AGAINST VALUERS

Most valuations are undertaken for lenders – but some developers will also undertake a valuation to prove up a businesscase. When the property is sold for less than that initial valuation – a common query is whether the valuer has beennegligent. However, a successful litigant will need to establish causation, prove the amount of the damages, and oftendefeat allegations of contributory negligence. Mark Chapple will review the law in the context of three very recentappellate court decisions:• Hay Property Consultants Pty Ltd & Anor v Victorian Securities Corporation Limited & Ors [2010] VSCA 247 (22

September 2010 )

A property was sold at a loss after a loan default and the lender took action against the valuer. The valuerargued that the loss had actually been caused by significant property damage caused by an unknown thirdparty and so it was not responsible. The lender counter-argued that it was only in a position to suffer the loss –by whoever caused – because it had relied upon the valuation in the first place.

• Kestrel Holdings Pty Ltd v APF Properties Pty Ltd [2009] FCAFC 144 (15 October 2009)

After being found liable for damages at first instance a valuer appealed, arguing that it did not owe a duty ofcare to the relevant party, that it had not been negligent at all, that any negligence had been caused by itsreliance on statements made by the borrower in a capacity as agent for the lender. The valuer also disputedthe basis of the damages assessment.

• St George Bank Limited v Quinerts Pty Ltd [2009] VSCA 245 (28 October 2009)

After determining that a valuation had been negligent the question then turned to damages. Here the valuerdisputed the basis of damages, argued against causation, and argued contributory negligence.

Mark Chapple, Partner, Baker & McKenzie

11.20 – 12.00 DIRECTOR’S DUTIES IN GROUP COMPANIES

In Mernda Developments Pty Ltd (in liq) v Alamanda Property Investments No 2 Pty Ltd a liquidator sought tohave transactions of the company set aside on the basis that they were undertaken by a shadow director in breach of hisduties as director.

At first glance the case appeared to be straightforward – the company had entered into a guarantee such that it was liablefor debts of $10m owed by related companies in which the now-liquidated company had no interest at all, to obtainfunding of only $3.8m – and the liquidator’s greatest challenge would be to establish that the person claimed to havebreached his duty was in fact a shadow director.

In fact the liquidator was unsuccessful because - the Court found – the company’s interests were ‘so intertwined with theinterests of other members of the group that those interests cannot be ignored’.

I’ve asked Simon Lynch to review the case for you and also to consider these questions:

• At what point might a company’s interests become ‘so intertwined’ with the interests of associated entities ‘that thoseinterests cannot be ignored’?

• Can the liquidator of a single company make an assessment of the overall group?

• What is the position if the ‘group’ includes the personal interest of directors.

Simon will explore the facts and use it as a base for discussion on this complex issue.

Simon Lynch, Partner, Allens Arthur Robinson

12.00 – 1.10 ANNUAL VOIDABLE TRANSACTIONS UPDATE - Phil Stern, Partner, Addisons Lawyers

1.10 – 2.20 Lunch

2.20 – 3.00 VALIDITY OF APPOINTMENT OF ADMINISTRATORS – AND COST IMPLICATIONS FORPRACTITIONERS

In Calabretta v Redpen Developments Pty Limited the Federal Court held that an administrator should take somesteps to confirm the validity of his or her appointment – notably raising a potential personal liability for costs if this wasnot done. In this session, SPEAKER will review a number of recent cases where the appointment of an administratorwas challenged and consider what issues the prospective administrator should consider before accepting anappointment, including:

• Calabretta v Redpen Developments Pty Limited - a director whose appointment was terminated by hisbankruptcy.

• re Nillumbik Community Church Inc (in administration) – a member argued that the organization was solvent.• Londish v Sheahan & Ors –a creditor argued that an appointment was invalid because the company was not

insolvent, and further that the appointment was not for a proper purpose - to enable the company to securelitigation funding to pursue a legal claim against an associated company.

• re Palamedia Limited – Two of the three directors required for a public company had purported to resign –could the remaining director make a valid resolution to appoint an administrator?

• Horne and Vrsecky as administrators of Australian Property Custodian Holdings Limited –Administrators were purportedly appointed by a secured creditor however that creditor arguably did not have acharge over ‘the whole or substantially the whole of the assets of the company.’

3.00 – 3.45 PRE-PACKS – ARE THEY REALLY A USEFUL TOOL THAT SHOULD BE USED MORE OFTEN AS INTHE UK?

• Section 420A duties when selling assets• Phoenix issues when selling back to Directors• Impact on fees• Souvlaki Hut

3.45 – 4.30 Closing Remarks from the Chair and Afternoon Tea

NOTE: Copyright Traill & Associates ©2011. Traill & Associates reserve the rights to change some elements of the program.

TESTIMONIALS

Rick Drury, General Manager, Strategic Business ServicesNational Australia Bank Limited

Michael Quinlan, Partner, Allens Arthur Robinson!

“Without question, the best technical insolvency conference I have ever attended.All topics were relevant, concise and presented by quality enthusiastic speakers.More importantly the topics addressed current issues on a practical basis, ratherthan the usual re-worked presentation we have all heard before. Definitelyexcellent content and great value, a highly recommended conference!”Andre Strazdins, Partner, BRI Ferrier South Australia

John Burke, The Business Physician

Richard Mansell, R.G.Mansell & Associates

Giles Woodgate, Principal, Woodgate & Co

Tim Williams, Head of Group Strategic Business Services - MelbourneGroup Risk, National Australia Bank Limited (April 2009)

John Melluish, Partner, Ferrier Hodgson (May 2005)

Mark Robinson, Partner, PPB Advisory (June 2005)

INVITATION FROM ROSIE TRAILL

CPD/CPE/MCLE12 CPD, CPE or MCLE

points

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For comments/suggestions please phone Rosie Traill on02 9449 8919 or 0405 136 001.