Wednesday 16 April 2014

Insolvency veteran slapped with suspension

Bill Hamilton
Photo: WJ Hamilton & Associates
BILL Hamilton, one of Australia's longest serving insolvency practitioners, has had his liquidator's registration suspended for six months following a hearing before the Companies Auditors & Liquidators Disciplinary Board (CALDB).

Details of the suspension and future compliance requirements were published in the Commonwealth Gazette yesterday, more than five months after the CALDB hearing, which took place on November 5, 2013. 

Hamilton, who began practising in 1960, last week advised the Australian Restructuring Insolvency & Turnaround Association (ARITA) that the decision was imminent. 

In a statement ARITA said: "In accordance with clause 7.1(b)(i) of the ARITA Constitution, Mr Hamilton's ARITA membership has been automatically suspended for six months effective from 2 June 2014 following a decision by the Companies Auditors and Liquidators Disciplinary Board (CALDB)".

CALDB found that Hamilton did not adequately and properly perform his duties as a joint liquidator by entering into a deed of settlement and release with the directors of ERB and a director-related company to accept an amount which had not been properly assessed.

It said no proper investigation had been made as to the financial capacity of the directors and related company to pay or what their true indebtedness was. 

Further, Hamilton did not adequately and properly carry out his duties as a joint liquidator by failing to seek the approval of the court or a resolution of creditors before entering into the deed of settlement and release; and failing to seek legal advice about entering into the deed of settlement and release.

CALDB also found that reports to creditors lacked meaningful information to enable creditors to make an informed assessment of the reasonableness of the liquidator’s remuneration, and that the liquidators failed to adequately account to creditors regarding the conduct of the winding up of ERB.

Lastly, CALDB found that Hamilton failed to lodge a report with ASIC in circumstances where possible offences by the directors had been identified.

Hamilton told SiN he accepted CALDB's opinion and would take it on the chin. "The decision will probably make good debate for many years to come about the duties of a secondary liquidator where there are Joint Liquidators appointed, " he said.

A CALDB spokesman said the board had yet to decide if it would make the reasons for its decision public. The fact the matter relates to a joint appointment may affect whether the decision is published, and if so, when.

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