What happens to leased equipment in liquidation?

Equipment on site belongs under different agreements

A restaurant company enters liquidation while ovens, a dishwasher and a coffee machine remain on site. The director believes all rented items should immediately go back, but one agreement is equipment finance rather than a simple rental. The landlord wants the premises cleared. Moving everything without checking the documents could create disputes over ownership, access and remaining liability.

Build an equipment register

Record each item’s serial number, location, condition and apparent owner. Match it to the lease, finance or purchase documents and any security records. Label uncertain ownership rather than resolving it by guesswork.

Give the register to the liquidator with photographs and contact details. Equipment owned by others should not be mixed into an informal sale of company assets.

Recognise who controls the next step

ASIC explains that directors lose their management powers on liquidation and must assist the liquidator. Refer requests for collection, sale or continued use to the practitioner.

Do not promise a lessor access or authorise removal independently. There may be site, safety, ownership and contractual questions requiring coordination between several parties.

Source: ASIC — Liquidation: a guide for creditors

Assess costs and obligations under the agreement

Provide arrears, current charges, return conditions and any guarantee. Ask how termination, collection and possible shortfall claims will be dealt with. Different contracts can lead to different outcomes.

Avoid assuming that returning the equipment settles all amounts or releases a guarantor. Have personal exposure reviewed separately where the director or another person signed supporting obligations.

Make any authorised return traceable

Follow the agreed collection process and record the items, condition, date and recipient. Retain photographs and a signed receipt where practical. Inform the liquidator about missing or damaged equipment promptly.

Coordinate access and utilities so removal does not damage the premises or create safety risks. A clear asset trail is more useful than clearing the site quickly without records.

Confirm ownership and authority before collection

Match every item to ownership and contract evidence.

Refer movement and return requests to the liquidator.

Keep a record of authorised collection and unresolved liabilities.

Call CRP today to coordinate support with leased assets and the liquidation handover.