Diana Denise Newman as liquidator of Riverview Heights Pty Ltd (in Liq) v Coropean Pty Ltd

Diana Denise Newman, as liquidator of Riverview Heights Pty Ltd, brought an action against Coropean Pty Ltd, seeking to recover payments made when the corporation was insolvent. The Federal Circuit Court of Australia was tasked with determining whether these payments constituted unfair preferences under the Corporations Act. The dispute centred on whether the payments were made within the six-month period before the corporation's liquidation, and if they placed the creditors in a better position than they would have been had the payments not been made.

The primary legal issue was whether the liquidator could successfully challenge the payments as unfair preferences. The court needed to consider the definition of "insolvency" under the Corporations Act, the timing of the payments in relation to the insolvency, and whether the payments put the creditors in a better position. The court also had to assess whether Coropean Pty Ltd had acted with the requisite knowledge of the insolvent status of Riverview Heights Pty Ltd when the payments were made.

The court found that Riverview Heights Pty Ltd was indeed insolvent at the relevant times, and the payments were made within the six-month period before the liquidation. The payments did put the creditors in a better position, and Coropean Pty Ltd had knowledge of the insolvent status of Riverview Heights Pty Ltd. Therefore, the court ruled that the payments constituted unfair preferences under the Corporations Act. The court ordered Coropean Pty Ltd to repay the amounts to Riverview Heights Pty Ltd's liquidator, to be distributed among the creditors according to law.