Charges over company book debts - continued uncertainty for Australian lenders
An article by Cameron Belyea and David Hargreaves of Clayton Utz, Sydney, Australia Key Point A UK appeal court decision has reversed a recently decided case regarding security over book debts. The ramification for Australian lenders is continued uncertainty. A company executing a charge over its assets will commonly include its present and future book debts. With the existence of Corporations Act 2001 sections like 433, 443E and 556, there are motives for ensuring that the charge over book debts is fixed rather than floating, especially if book debts make up a significant proportion of the company’s assets.
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