Where part of an unsecured debt is paid before winding up, the comparison under s 588FA(1)(b) is between the amount received in respect of that part and what the creditor would have received in a winding up proving for that part — not the whole debt. A payment and transfer of assets to a creditor some three weeks after the debt arose, following dishonoured cheques and failed payment promises, constitutes a separate transaction for s 588FA purposes and cannot be characterised as part of the original sale. Trust monies paid into an overdrawn bank account cease to exist, defeating any proprietary claim. A reasonable person who has received two dishonoured cheques for $165,000, inadequate explanations, a failed payment promise, and an offer of only $10,000 and two cars in lieu of $165,000 would have grounds for suspecting insolvency.
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