Your FOS Toolkit
Topics discussed: Listing a default with credit reporting agencies & Hardship application – superannuation
1 December 2017
Topics discussed: Listing a default with credit reporting agencies & Hardship application – superannuation
It is common in construction and commercial leasing transactions for a party to provide an unconditional bank guarantee to secure the performance of their contractual obligations.
It is common for commercial contracts to contain ipso facto clauses, which allow a party to terminate or modify the terms of the contract where the other party experiences an insolvency event. A concern addressed by the Government is that these clauses can prevent a financially distressed company from turning their situation around.
In a recent case in the District Court of Queensland, a lender failed to prove it had served default notices. The lender was unsuccessful in obtaining summary judgment for the loan debt and possession of the mortgaged property.
The High Court’s recent decision in Ramsay Health Care Australia Pty Ltd v Compton [2017] HCA 28 has confirmed a bankruptcy court can exercise a discretion to go behind the judgment debt where sufficient reason is shown for questioning whether there is a debt due to the petitioning creditor.
From 1 July 2017, banks are required to collect information from customers that are non-residents. Banks will share the information with the ATO, who will then share it with tax authorities in other countries that have signed up to the Common Reporting Standard (CRS).
From 1 July 2017, the Farm Business Debt Mediation Act 2017 (Qld) will require mortgagees to offer to engage in mediation with mortgagor farmers before commencing any enforcement action to recover outstanding farm business debts.
The Financial Ombudsman Service Australia (FOS) deals with a range of disputes including banking, credit, loans, insurance and financial planning.
A recent Court of Appeal decision provides a firm reminder to the banking industry that the obligations in the Code of Banking Practice impose strict legal obligations that lenders must adhere to in dealings with guarantors.
In our previous bulletin we discussed the ‘safe harbour’ model in the Government’s suggested reforms to the current insolvency laws. This bulletin considers another of the focus questions in the Proposal Paper: the voiding of ipso facto clauses relating to insolvency events.
In a recent determination, the Financial Ombudsman Service (FOS) reduced the liability of a co-borrower who received no ‘real’ benefit from the loan.
All licenced financial service providers in Australia are required to subscribe to an external dispute resolution scheme approved by ASIC.