From sladen.com.au: The case of Ford Kinter & Associates Pty Ltd v Reliance Franchise Partners Pty Ltd highlights the importance of creditor funding in insolvency proceedings, as the court ruled that creditors who assume financial risks in litigation can be prioritised for asset recovery.

Ford Kinter provided significant funding to the Liquidators, which led to a substantial recovery, and the court found that this warranted granting them priority under section 564 of the Corporations Act 2001.

The decision reinforces the public interest in encouraging creditor contributions to support complex liquidations.