Corporations Act 2001 (Cth) · s588FC

Insolvent transactions

LedgerSignal libraryChecked against the Act as compiled on 19/09/2026Keay's Insolvency ch 14

What it covers

An unfair preference or uncommercial transaction only becomes voidable under most of s588FE if it is also an insolvent transaction: the company was insolvent when it happened, or became insolvent because of it.

"…it is an unfair preference given by the company, or an uncommercial transaction of the company…"s588FC

Elements

1It is an unfair preference or an uncommercial transaction
Defined in s588FA and s588FB.
s588FC
2The company was insolvent at the time
When the transaction was entered into, or when an act or omission gave effect to it.
s588FC(a)
3Or it made the company insolvent
The company became insolvent because of, or because of matters including, the transaction or an act giving effect to it.
s588FC(b)

Not needed for

Unfair loans (s588FE(6)) and unreasonable director-related transactions (s588FE(6A)) are voidable without being insolvent transactions. Creditor-defeating dispositions have their own insolvency conditions (s588FE(6B)).

Cases

ASIC v Plymin[2003] VSC 123

Lists the indicators courts use as evidence that a company was insolvent.

Read the judgment on AustLII