ABSTRACT
This chapter highlights the legal and policy issues flowing from the decision in Sons of Gwalia. It discusses the tensions in Australian law flowing from the collision of securities law and insolvency law following violation of securities law and its impact on the system of creditor priorities under insolvency law. It is submitted that the potential problems caused by the High Court's decision in Sons of Gwalia outweigh the potential benefits and advances the case for law reform. The chapter evaluates potential law reform models in the treatment of aggrieved shareholder claims within corporate insolvency and identifies the challenges for Australian law reform. It focuses on a broad range of issues affecting the concept of an aggrieved shareholder as creditor in Australian corporate insolvency. Aggrieved shareholders, major beneficiaries of the decision in Sons of Gwalia, will now be able to lodge proofs of debt with external administrators.
