PLEASE ANSWER IN IRAC FORM !!
InHope Pty Ltd has been operating as a boutique chocolatier in Melbourne since 2000 . Recently, the company has experienced continued decrease in sales, and increased in operating costs. This has caused 3 consecutive quarters in which the company has operated at a loss. With COVID-19 the business has tried to focus on online sales, but this has nit bee successful. Jane Hope is the sole director of InHope Pty Ltd and also the majority shareholder. Jane has let go several staff, leaving only family members as the remaining employees, who are happy to receive shares in the company as their 'wages'. Jane believes that the market for premium chocolates will pick up again, and is determined to keep the company going. Unfortunately, InHope is in arrears on lease payments for all of its production machinery. This equipment is valued at $150,000; the owner is Industrial Production Pty Ltd and the lease payments are currently $9,000 in arrears. InHope lacks sufficient liquid financial resources to pay the arrears, but also alleges that the equipment is not working as well as it should. Under the lease, Industrial Production has a security interest over the machinery and also has the right to appoint a receiver and manager if lease payments are more than 30 days in arrears. A. What would happen if Industrial Production exercised its right to appoint a receiver and manager to InHope Pty Ltd? Consider the benefits and detriments to the parties involved B. If the board of InHope Pty Ltd put the company into voluntary administration, how would this affect Industrial Production? C. Assume a court order has been obtained to wind up InHope Pty Ltd. The liquidator discovers that two months earlier, Jane had arranged for the company pay her $5,000 as a lump sum in return for her work as a director until that date, and also arranged for the company to pay a supplier in full because Jane felt sorry for them given they would be unlikely to receive any payment once a liquidator was appointed. Can the liqudiator recovrer the $5,000 in directors' fees paid to Jane and/or the payment made to the supplier? InHope Pty Ltd has been operating as a boutique chocolatier in Melbourne since 2000 . Recently, the company has experienced continued decrease in sales, and increased in operating costs. This has caused 3 consecutive quarters in which the company has operated at a loss. With COVID-19 the business has tried to focus on online sales, but this has nit bee successful. Jane Hope is the sole director of InHope Pty Ltd and also the majority shareholder. Jane has let go several staff, leaving only family members as the remaining employees, who are happy to receive shares in the company as their 'wages'. Jane believes that the market for premium chocolates will pick up again, and is determined to keep the company going. Unfortunately, InHope is in arrears on lease payments for all of its production machinery. This equipment is valued at $150,000; the owner is Industrial Production Pty Ltd and the lease payments are currently $9,000 in arrears. InHope lacks sufficient liquid financial resources to pay the arrears, but also alleges that the equipment is not working as well as it should. Under the lease, Industrial Production has a security interest over the machinery and also has the right to appoint a receiver and manager if lease payments are more than 30 days in arrears. A. What would happen if Industrial Production exercised its right to appoint a receiver and manager to InHope Pty Ltd? Consider the benefits and detriments to the parties involved B. If the board of InHope Pty Ltd put the company into voluntary administration, how would this affect Industrial Production? C. Assume a court order has been obtained to wind up InHope Pty Ltd. The liquidator discovers that two months earlier, Jane had arranged for the company pay her $5,000 as a lump sum in return for her work as a director until that date, and also arranged for the company to pay a supplier in full because Jane felt sorry for them given they would be unlikely to receive any payment once a liquidator was appointed. Can the liqudiator recovrer the $5,000 in directors' fees paid to Jane and/or the payment made to the supplier
