Tenants' moratoria under the Corporations Act and relief against forfeiture

Kathrine Galloway, Tim McGrath

Research output: Contribution to journalArticleResearchpeer-review


Appointment of an administrator over company assets under the Corporations Act 2001 (Cth) is a means by which company property may be protected for the benefit of creditors and shareholders in the face of actual or anticipated insolvency. Creditors' and shareholders' interests in or claims upon company property are often in conflict with those of third parties – such as lessors of real property who might seek to forfeit the company's lease and regain possession of property. In these circumstances, the tenant company in administration may make a claim for relief against forfeiture or call upon the application of a s 444F moratorium. As two recent cases show, such a moratorium may be extended beyond the expiration or termination of a deed of company arrangement. This article examines the decisions in Kelly and Morris v Hedz Pty Ltd (vol admin apptd) (rec and mngrs apptd) (unreported, Sup Ct, Qld, Jones J, 30 July 2010) and Strazdins v Birch Carroll & Coyle Ltd (2009) 178 FCR 300 [PDF] to determine the extent to which s 444F declarations can be considered to align with or augment equitable relief. In doing so it considers a 2011 Federal Court critique of s 444F protection, concluding that unless s 444F is reconsidered, relief against forfeiture may be a preferable remedy.
Original languageEnglish
Pages (from-to)5-17
Number of pages12
JournalInsolvency Law Journal
Issue number1
Publication statusPublished - 2012
Externally publishedYes


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