A direction under s 511 may be given to protect liquidators entering into a settlement of litigation where the settlement does not cover all potential claimants and may exhaust available insurance, particularly where the liquidators are operating in an acrimonious environment. The court's role under s 477(2B) is to review the liquidator's proposal paying due regard to commercial judgment, satisfying itself the agreement is a proper exercise of power with no error of law or bad faith, and weighing whether there is good reason to intervene in terms of the expeditious administration of the winding up.
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