More construction companies, already under pressure from stretched supply chains and labour shortages, are expected to face insolvency in 2022. Parties should include a broad definition of “insolvent” in contracts, as even if the counterparty is not insolvent for the purposes of the Corporations Act 2001 (Cth) (Corporations Act), the courts will apply the broader contractual definition when considering if there has been a contractual default triggering termination rights.
