Creditor who gives up benefit of unfair preference may prove for preferred debt
(1) This section applies where: (a) a transaction is an unfair preference given by a company to a creditor of the company after 23 June 1993; and (b) at the request of the company’s liquidator, because of an order under section 588FF or 588FGAA, or for any other reason, the creditor has put the company in the same position as if the transaction had not been entered into. (2) A court must not make under section 588FF, on an application relating to the transaction, an order prejudicing a right or interest of the creditor. (2A) ASIC must not make an order under section 588FGAA that relates to the transaction and prejudices a right or interest of the creditor. (3) The creditor may prove in the winding up as if the transaction had not been entered into.
Sourced from the Federal Register of Legislation at 17 May 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au. Verify the current text against the official source before relying on it.
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