FEDERAL COURT OF AUSTRALIA Deputy Commissioner of Taxation v Kentucky Group Pty Limited [2010] FCA 1503 Citation: Deputy Commissioner of Taxation v Kentucky Group Pty Limited [2010] FCA 1503 Parties: DEPUTY COMMISSIONER OF TAXATION v KENTUCKY GROUP PTY LIMITED File number(s): NSD 747 of 2010 Judge: EMMETT J Date of judgment: 12 November 2010 Date of hearing: Heard on the papers Place: Sydney Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 5 Solictor for Kentucky Group Pty Limited: Brown & Partners IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD747 OF 2010 BETWEEN: DEPUTY COMMISSIONER OF TAXATION Plaintiff AND: KENTUCKY GROUP PTY LIMITED Defendant JUDGE: EMMETT J DATE OF ORDER: 12 November 2010 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. This application be dealt with in the absence of the public and without any attendance by, or on behalf of, the joint provisional liquidators. 2. The joint provisional liquidators' remuneration in the sum of $27,594.00 in respect of the period of 12 July 2010 to 30 July 2010 be approved. 3. The joint provisional liquidators' legal costs be payable out of the Defendant's assets forthwith. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 747 of 2010 BETWEEN: DEPUTY COMMISSIONER OF TAXATION Plaintiff AND: KENTUCKY GROUP PTY LIMITED Defendant JUDGE: EMMETT J DATE: 12 November 2010 PLACE: SYDNEY REASONS FOR JUDGMENT 1 On 12 July 2010, the Court appointed Mr Paul Weston and Mr Anthony Elkerton (the Provisional Liquidators) as joint provisional liquidators of Kentucky Group Pty Ltd (the Company). On 30 July 2010, Mr Weston together with Mr David Young were appointed joint official liquidators of the Company. By interlocutory process filed on 10 September 2010, the Provisional Liquidators applied for orders that their remuneration in respect of the period 12 July 2010 to 30 July 2010 be approved and their costs be paid out of the Company's assets forthwith. They also applied for an order that that the application be dealt with in the absence of the public and without any attendance in open court by the Provisional Liquidators. 2 The Company was incorporated on 29 May 2007. Its principal activity was the distribution and placement of fragile and sensitive goods, commercial furniture, shop fixtures and fittings, medical and veterinary equipment, amusement machines, ergonomic seating and work stations. The official liquidators accepted the reasons given by the director of the Company for its failure as being a downturn in trading patterns, excess start-up costs, the global financial crisis and a fall in the exchange rate of the Australian dollar. 3 At the time of the appointment of the Provisional Liquidators, the total estimated realisable value of the Company's assets was $187,470, against liabilities of approximately $777,242. During the period of the provisional liquidation, the Provisional Liquidators and their employees undertook work in relation to the Company consisting of the ascertainment of the financial position of the Company and investigating its books and records. In addition, they undertook the investigation of the transfer of assets from the Company to another company on 1 July 2010 prior to their appointment and investigated any potential unfair preference payments. The Provisional Liquidators were required to deal with some 19 creditors of the Company and were engaged in the work briefly described above for in excess of 90 hours. They claim the sum of $27,594 including GST as remuneration for the work they carried out. 4 On 29 July 2010, notice was served on the 19 creditors in accordance with Rule 9.3 of the Federal Court (Corporations) Rules 2000. On 19 October 2010, notice was given to substantial creditors. None of the creditors has objected to the proposed remuneration. 5 In all of the circumstances, I consider that it is appropriate to deal with the matter on the papers without the necessity of attendance at Court. It is appropriate that the remuneration be approved and that the Provisional Liquidators' legal costs be paid out of the Company's assets. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett. Associate: Dated: 25 January 2011