The Supreme Court of Victoria delivered judgment on 4 March 2016 in Warehouse Sales Pty Ltd (in liq) v WHS2 Pty Ltd (in liq) [2016] VSC 63. This case is particularly useful to liquidators as it deals with a number of questions that often confront liquidators, including:

1. When will an application under section 511 Corporations Act 2001 (Cth) (the Act) be heard in the absence of a contradictor?;
2. What are the grounds on which a direction under section 511 of the Act can be made?;
3. When will the Court give directions approving a settlement agreement?; and
4. When will a payment under a settlement agreement between a liquidator and a creditor have priority under section 556(1)(a) of the Act?

The main focus of this Turkalert is the fourth question, which related to a settlement payment by the liquidators to a number of creditors who were TurksLegal clients.