Recently the Supreme Court of Victoria had to determine in Delahunt v Swim Loops Pty Ltd  VSC 269 whether the Franchisees should be granted an injunction to allow them to regain possession and operation of the business while proceedings were before the Court. The Franchisee argued that the Franchisor had terminated their Franchise Agreement in addition to being evicted from the franchise premises.
The Court granted the injunction allowing Mr and Mrs Delahunt back into the business to continue to operate it subject to a resolution of other issues.
As of May 2018, there were approximately 2,598,541 registered companies in Australia. The majority of these businesses fall into the category of a small business. Accounting for 33% of GDP, small corporate entities are vital to the national economy. However, due to their small scale, it is often the case that these small entities only have one or two shareholders, which can create difficulties when conflict arises between shareholders who have an equal stake in a company.
The recent decision of Justice Logan of the Federal Court in Australia and New Zealand Banking Group Limited v State of Queensland  FCA 464 acts as a reminder to directors and insolvency practitioners of the importance of default notices in retaining contractual rights and enforceable securities. It discusses the operation of section 133 of the Bankruptcy Act 1966 (Cth) (Act) and how it can protect security holders against bankruptcy disclaimers and the doctrine of escheat.
Justice Sifris in the recent Supreme Court decision of Eco Heat (Vic) Pty Ltd v the Syndicate Forty Four Pty Ltd (Subject to DOCA) & Ors  VSC 156 used his power under the Corporations Act 2001 (Cth) to terminate a Deed of Company Arrangement executed by creditors. His Honour demonstrated the Court’s power to use such measures where corporate morality or public interest issues arise.