Melbourne Law School - Theses
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ItemMoratorium legislation in the Canadian and Australian rural sector : its history and present utility( 1989)A. The Analysis and Problem 1. At Common Law the rights of creditors were virtually absolute. 2. Over time, the law has whittled away the unimpeded rights of unsecured creditors through bankruptcy and insolvency legislation. 3. Secured Creditors have also had rights, throughout legal history, which were, virtually, inviolate. 4. In Canada and in Australia, bankruptcy legislation has had very little effect on the rights of secured creditors. 5. However, in times of crisis, even the rights of secured creditors have been restricted in the interest of the common good. 6. The pendulum continues to swing in favour of creating more rights in favour of debtors and restricting secured creditors' rights in Australia and Canada. 7. There is a strong lobby urging the restriction of secured creditors' rights as they relate to farm debtors due to the extreme economic hardship faced by those persons during the 1980's. B. The Issues 8. Whether it is appropriate to further expand the rights of debtors and to restrict the remedies of secured parties in any circumstances through moratorium legislation. 9. Whether farm debtors fit within the principles justifying interference with secured creditors' rights. 10. What safeguards should be inserted in such legislation to ensure that there is proper balance for the legitimate concerns of both debtors and creditors. C. Conclusions 11. Present legislation in Canada is deficient and does not properly assist either debtors or creditors involved in the present farm difficulties. 12. Australian legislation is superior because it has addressed all of the issues facing agriculture and has recognised that there must be adjustment in agriculture. 13. There is a place for moratorium legislation as a means to an end, namely, in promoting alterations in the agricultural sector to promote future efficiency and, potentially, to assist in the transition of nonviable farm enterprises out of the agricultural sector. 14. However, steps must be taken to preserve and protect the fundamental and historical freedoms of creditors.