78F. Power of Court where creditor objection made

Question 1

78F. Power of Court where creditor objection made

Answer 1

General overview
[78F.01] Section 78F sets out the powers of the court upon a creditor’s application for objection under s 78D. By and large, the court has to order a cancellation of the proposed capital reduction where any debt or claim is outstanding and (a) the debt or claim has not been adequately secured nor safeguards provided by the applicant; and (b) the security and safeguards are necessary in view of the assets the company would have after the reduction.

Question 2

Debt or claim outstanding

Answer 2

[78F.02] Subsection (6) defines what is meant by an outstanding debt or claim, i.e. it is a debt that has not been discharged nor a claim that has not been terminated.