The interests of a secured party are not unfailing, and appropriate attention should be given to ensuring that they are placed to receive the best outcome from administration. The extent of this susceptibility was highlighted in the recent Federal Court decision of Jones (Admin) v Realtek Semiconductor Corp Nuheara Ltd (Admins Apptd) (No 1) [2025].

Where an arrangement undermines the entitlements of a secured creditor, consideration should be had to the benefits conferred by the arrangement on other creditors broadly, particularly where the alternative is liquidation.