½ñÈÕÈÈÃÅʼþ

½ñÈÕÈÈÃÅʼþhas accepted an enforceable undertaking (EU) from Sydney-based registered liquidator, Mr Clifford John Sanderson of Dissolve Pty Ltd as Trustee for the Dissolve Unit Trust, following an ½ñÈÕÈÈÃÅʼþreview of an external administration that found he failed to adequately and properly discharge his duties as a registered liquidator.

Mr Sanderson has undertaken to:

• engage an independent expert at his own cost to review his insolvency practice and to conduct quality reviews on three external administrations, and
• complete 60 hours of Continuing Professional Development within 12 months including a minimum of 20 hours of CPD relating to insolvency courses provided by ARITA.

½ñÈÕÈÈÃÅʼþreviewed Mr Sanderson’s external administration of Nepean Refrigeration and Air Conditioning Pty Ltd (now deregistered) and found he failed to adequately discharge his duties in that he:

• did not conduct a real property search in circumstances where the director’s report as to affairs, or the books and records provided to him, did not disclose the company’s entitlement to any real estate

• did not undertake adequate investigations into the company’s assets (including real property, plant & equipment and debtors)

• did not prepare, or alternatively, properly document, his assessment of his independence prior to accepting the appointment as external administrator

• did not make requests of the company’s bookkeeper regarding the company’s financial affairs

• did not adequately review voidable transactions, including unfair preferences and uncommercial transactions, or alternatively, failed to adequately document that review, and

• did not make a claim against the company’s director for possible insolvent trading, despite identifying the possibility of such a claim to ½ñÈÕÈÈÃÅʼþand creditors,, or alternatively, did not properly document his reasons for not taking such action.

½ñÈÕÈÈÃÅʼþCommissioner John Price said, ‘Creditors have a right to know that liquidators undertake their work independently and competently. ½ñÈÕÈÈÃÅʼþcontinues to work with practitioners to improve these aspects of their practices.’ 

½ñÈÕÈÈÃÅʼþacknowledges Mr Sanderson’s cooperation and notes that he undertook remedial action to address ASIC’s concerns when ½ñÈÕÈÈÃÅʼþbrought the deficiencies in the discharge of his duties to his attention.

• Download the enforceable undertaking