Australian High Court Upholds Examination Rights of Eligible Applicants

This article forms part of our litigation funding series and discusses a key decision that has the potential to significantly support the due diligence efforts of litigation funders in external administration contexts.

On 16 February, the High Court of Australia handed down its decision in a long-running dispute concerning former ASX listed Arrium Limited (Arrium). The judgment provides clarity on the purposes for which an Australian Securities and Investments Commission (ASIC) authorised eligible applicant may conduct public examinations into the affairs of a corporation in external administration. It also provides legal certainty to shareholders, and importantly litigation funders, who may be seeking to conduct investigations into potential claims against a company in external administration, counterparties to that entity, its former or current advisors or its directors and officers.