FEDERAL COURT OF AUSTRALIA McLay as Liquidator of Ross Holdings (WA) Pty Ltd (in liq), in the matter of Ross Holdings (WA) Pty Ltd (in liq) [2014] FCA 1208 Citation: McLay as Liquidator of Ross Holdings (WA) Pty Ltd (in liq), in the matter of Ross Holdings (WA) Pty Ltd (in liq) [2014] FCA 1208 Parties: DOUGAL MCLAY AS LIQUIDATOR OF ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) v ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) File number(s): WAD 233 of 2012 Judge(s): SIOPIS J Date of judgment: 31 October 2014 Catchwords: CORPORATIONS – application that a liquidator be released and that the company be deregistered – application that the liquidator be permitted to destroy the company books. Legislation: Corporations Act 2001 (Cth) ss 480(d), 542, 542(2), 542(3)(a) Federal Court (Corporations) Rules 2000 (Cth) rr 2.8(3), 7.5 Date of hearing: 31 October 2014 Place: Perth Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 16 Counsel for the Applicant: Mr B Morton Solicitor for the Applicant: Mendelawitz Morton IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION WAD 233 of 2012 IN THE MATTER OF ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) DOUGAL MCLAY AS LIQUIDATOR OF ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) Applicant ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) Respondent JUDGE: SIOPIS J DATE OF ORDER: 31 october 2014 WHERE MADE: PERTH THE COURT ORDERS THAT: 1. Dougal McLay be released as liquidator of the respondent. 2. The Australian Securities and Investment Commission deregister the respondent. THE COURT DIRECTS THAT: 3. All books of the respondent and of the applicant that are relevant to the affairs of the respondent, at or subsequent to the commencement of the winding up of the respondent may be destroyed by the applicant after the deregistration of the respondent. 4. The applicant's costs in this application be a cost in the liquidation of the respondent. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION WAD 233 of 2012 IN THE MATTER OF ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) DOUGAL MCLAY AS LIQUIDATOR OF ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) Applicant ROSS HOLDINGS (WA) PTY LTD (IN LIQUIDATION) (ACN 123 503 766) Respondent JUDGE: SIOPIS J DATE: 31 october 2014 PLACE: PERTH REASONS FOR JUDGMENT 1 This is an application by Mr Dougal McLay as liquidator of Ross Holdings (WA) Pty Limited (in liquidation) (the company) for: (a) orders under s 480(d) of the Corporations Act 2001 (Cth) that he be released as liquidator; and that the Australian Securities and Investments Commission (ASIC) deregister the company, and (b) a direction under s 542(3)(a) of the Corporations Act that the applicant may destroy the books and records of the company. 2 In support of the application, Mr McLay has relied upon three affidavits. The first affidavit is dated 15 August 2014 and was filed at the same time as the application was filed. The affidavit deals with many of the matters which are mandatory under s 7.5 of the Federal Court (Corporations) Rules 2000 (Cth) (the Rules). The second affidavit was filed on 21 October 2014. Mr McLay deposed in that affidavit to the steps he had taken to serve the application and supporting affidavit upon the named creditors and contributories of the company. However, that affidavit did not mention that Mr McLay had served this application and the supporting affidavit upon ASIC in compliance with r 2.8(3) of the Rules. That rule requires that ASIC be served with the interlocutory process in relation to an application which has been brought under s 480(d) of the Corporations Act. 3 On 23 October 2014, I adjourned the application for a week in order to permit the application and supporting affidavit to be served upon ASIC. 4 The third affidavit is dated 27 October 2014. In that affidavit, Mr McLay deposed that on 23 October 2014, he served ASIC by post with a copy of the originating application and supporting affidavit. 5 An application for release under s 480(d) of the Corporations Act is an important application because it has the effect of wiping the slate clean for a liquidator. Therefore, it is important that ASIC be notified of any such application and have an opportunity insofar as it may wish to be heard in opposition to that order. 6 Mr Morton who appears on behalf of Mr McLay today has not produced a letter from ASIC, as is often provided by ASIC to an applicant applying for relief under s 480(d) of the Act, advising of its attitude to the application. However, Mr Morton has said from the Bar table that he had spoken to an officer from ASIC who advised Mr Morton that unless ASIC served a notice on Mr Morton's client to the effect that it objected to the order being made, ASIC would not be appearing today to oppose the application. Mr Morton went on to say that no such notice from ASIC had been served on his client, nor had ASIC given him any other indication that it intended to appear today to oppose the application. 7 The evidence shows that the company was wound up on the application of the Australian Taxation Office, that the company's business was sold by Mr McLay, and the total amount owed to unsecured creditors of the company was in excess of $811,000. The only creditor that will be paid anything in the liquidation is the Australian Taxation Office. It will be paid a dividend in relation to the superannuation guarantee charge which was payable by the company. 8 For an applicant to obtain an order under s 480(d) of the Corporations Act, he or she must comply with the requirements set out specifically in r 7.5 of the Rules. One of the provisions of r 7.5 prescribes the matters which must be addressed in the affidavit in support of the application. 9 Mr McLay has, in his affidavit of 15 August 2014, as supplemented by his affidavit of 28 October 2014, deposed to each of those matters which are set out in the provisions of r 7.5 of the Rules. 10 I have already mentioned that Mr McLay has deposed that he has caused a copy of the application and supporting affidavit to be served on each of the contributories and creditors of the company. The affidavit contains a list of all of those persons. I observe also that in compliance with r 7.5 of the Rules, the originating application served on the creditors and contributories, contains the notice stating the effect of an order under s 480(d) of the Corporations Act. Further, each of those persons was advised that they were entitled to appear today to oppose the making of these orders. However, no creditor or contributory has today appeared to oppose the making of the orders sought under s 480(d), nor indeed the direction which is sought in relation to the destruction of the company's books under s 542 of the Corporations Act. 11 I have already mentioned that pursuant to r 2.8(3) of the Rules, the originating application and supporting affidavit have now been served on ASIC. I should also mention that on 6 October 2014, Mr McLay did serve ASIC with the requisite notice in relation to the application under s 542 of the Corporations Act for a direction for the destruction of the company's books. ASIC has not appeared today in response to either the service of the application or the notice in relation to the direction sought under s 542. 12 On the basis of the evidence which is before me, I am satisfied that Mr McLay has complied with the statutory requirements. Further, there are no persons here today who object to making of the proposed orders. In those circumstances, I am content to make the orders under s 480(d) of the Corporations Act that Mr McLay be released as liquidator and that ASIC deregister the company. 13 Mr McLay also applies for a direction under s 542 of the Corporations Act, that the liquidator be permitted to destroy the company's books before the expiry of the five year period which is prescribed under s 542(2) of the Corporations Act. 14 Mr McLay has not specified any minimum further period of retention before he be permitted to destroy the company's books. Section 542 of the Corporations Act does not prescribe a minimum period of retention of the books after the date of the making of any such direction under s 542(2). Mr McLay has deposed to the expenses which would be incurred by continuation of the retention of the company's books, and that he wishes to minimise that expenditure. I will make an order that Mr McLay be entitled to destroy the books of the company without specifying any limitation of the continued retention of the books. 15 I am satisfied that the requirements of service in relation to the making of that direction have also been satisfied. I am not aware of any circumstance which would preclude the Court from making the direction sought. 16 Mr McLay has also sought an order that the costs of this application be paid under liquidation. I will make that order as well. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis. Associate: Dated: 11 November 2014