When our family company started having financial problems a couple of years back we transferred some property that had been held by the company to two of our daughters. Now the liquidator is asking us to provide information on all asset sales and transfers. Where do we stand with this?
Lawyer Answers (1): Answers from lawyers are general preliminary responses. They are not formal legal advice and cannot taken account of all your circumstances. They do not create a lawyer–client relationship.
Answer by Kelly Angus, Adelaide 5000 SA
- The liquidator will investigate any asset sales or transfers that occurred in the years leading up to the liquidation so yes the liquidator is likely to examine the property transfers.
- If any transactions appear to be improper or uncommercial or for the purpose of defrauding creditors the liquidator may be able to recover the property in question or its value.
- The liquidator may also recover money from creditors who received ‘preferential’ payments in the lead up to the liquidation.
- Since this transaction did not occur ‘at arm’s length’ because it was between family members you may need to prove that your daughters paid the company a fair market value for the property.