Miracle workers or ambulance chasers? The role of administrators in the Part 5.3A process
This article considers the role of the administrator under a voluntary administration and also briefly under a deed of company arrangement. There has been some criticism that the procedure does not permit proper standards to apply to administrators and this article seeks to examine that question and, in doing so, rejects some of that criticism. The article examines how an administrator may be removed by the court as well as outlining the duties of the administrator under the legislation. The issue of the fiduciary duties of the administrator is also considered. As a result of this discussion it is argued that with proper supervision by ASIC, as the registering authority for administrators, the current method of appointment of administrators by directors should remain. However, it is suggested that the administrator should not have a casting vote in relation to deadlock between the number and value of creditors as this unnecessarily reduces the administrator's perceived independence. The article concludes by providing a broader policy analysis which focuses on why an independent administrator is a preferred option to the North American model of debtor in possession and how this may be consistent with economic efficiency.
Insolvency Law Journal