FEDERAL COURT OF AUSTRALIA White, in the matter of Macro Realty Developments Pty Ltd and Macro Realty Pty Ltd (No 2) [2020] FCA 649 File number: WAD 332 of 2019 Judge: MCKERRACHER J Date of judgment: 14 May 2020 Catchwords: CORPORATIONS – liquidators – application for approval of funding agreement under s 477(2B) of the Corporations Act 2001 (Cth) – where agreement has already been executed – approval sought nunc pro tunc – consideration of an approval under s 477(2B) and a direction under Sch 2 s 90-15 of the Corporations Act 2001 (Cth) PRACTICE AND PROCEDURE – non-publication orders – application by liquidator that affidavit and submissions be marked confidential pursuant to ss 37AF(1)(b)(i) and (37AF(1)(b)(iv) of the Federal Court of Australia Act 1976 (Cth) – whether orders necessary to prevent prejudice to the proper administration of justice Legislation: Corporations Act 2001 (Cth) ss 90-15, 90-20, 477(2B), 1322(4), 1322(4)(a), 1322(4)(d) Federal Court of Australia Act 1976 (Cth) s 37AF. 37AF(1)(b)(i), 37AF(1)(b)(iv), 37AF(2) Federal Court Rules 2011 (Cth) r 9.05(1) Cases cited: Chamberlain v RG & H Investments Pty Ltd (No 2) (2009) 76 ACSR 415; [2009] FCA 1531 Deputy Commissioner of Taxation, in the matter of ACN 154 520 199 Pty Ltd (in liq) v ACN 154 520 199 Pty Ltd (in liq) (No 2) [2017] FCA 755 Goyal (liquidator), in the matter of OLI 1 Pty Ltd (in liquidation) [2020] FCA 450 Hamilton, in the matter of ACN 101 634 146 Pty Ltd (in liq) [2014] FCA 687 Hancock (liquidator), in the matter of South Townsville Developments Pty Limited (in liq) Hayes, in the matter of Denham Constructions Pty Limited (in liq) [2018] FCA 2053 Re Kevin Jacobsen Pty Ltd (in liq) [2016] NSWSC 538 Krejci (liquidator), in the matter of Community Work Pty Ltd (in liq) [2018] FCA 425 Re Minken Pty Ltd (in liq) [2019] VSC 288 Re One. Tel Ltd and Others (2014) 99 ACSR 247 Re Read and Another [2007] FCA 1985 Date of hearing: Determined on the papers Date of last submissions: 8 May 2020 Registry: Western Australia Division: General Division National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Category: Catchwords Number of paragraphs: 26 Counsel for the Applicants: Mr L Lee Solicitor for the Applicants: Lavan ORDERS WAD 332 of 2019 IN THE MATTER OF IN THE MATTER OF: MACRO REALTY DEVELOPMENTS PTY LTD (IN LIQUIDATION) (ACN 159 678 930) AND MACRO REALTY PTY LTD (IN LIQUIDATION) (ACN 143 381 060) BETWEEN: HAYDEN LEIGH WHITE AND MATTHEW DAVID WOODS IN THEIR CAPACITY AS JOINT AND SEVERAL PROVISIONAL LIQUIDATORS OF MACRO REALTY DEVELOPMENTS PTY LTD (IN LIQUIDATION) (ACN 159 678 930) AND MACRO REALTY PTY LTD (IN LIQUIDATION) (ACN 143 381 060) First Applicants HAYDEN LEIGH WHITE AND MATTHEW DAVID WOODS IN THEIR CAPACITY AS JOINT AND SEVERAL LIQUIDATORS OF MACRO REALTY DEVELOPMENTS PTY LTD (IN LIQUIDATION) (ACN 159 678 930) AND MACRO REALTY PTY LTD (IN LIQUIDATION) (ACN 143 381 060) Second Applicants JUDGE: MCKERRACHER J DATE OF ORDER: 14 MAY 2020 THE COURT ORDERS THAT: 1. Pursuant to r 9.05(1) of the Federal Court Rules 2011 (Cth), Hayden Leigh White and Matthew David Woods in their capacity as joint and several liquidators of the following entities be joined as applicants in these proceedings: (a) Teale WA Pty Ltd (In Liquidation); (b) WAH Holdings WA Pty Ltd (In Liquidation); (c) Twistjac Pty Ltd (In Liquidation); (d) Marchibold Pty Ltd (In Liquidation); (e) Andrawartha Pty Ltd (In Liquidation); (f) Diep WA Pty Ltd (In Liquidation); and (g) Veneman Pty Ltd (In Liquidation), (Macro Parties). 2. Pursuant to s 1322(4)(d) of the Corporations Act 2001 (Cth), the period for making an application under s 477(2B) of the Corporations Act for approval of entry into the funding agreement dated 30 March 2020 (being annexure marked 'HLW5' of the confidential affidavit of Hayden Leigh White sworn 1 May 2020) (Confidential White Affidavit) (Funding Agreement) is extended to 1 May 2020. 3. Pursuant to s 477(2B) of the Corporations Act, approval is given nunc pro tunc to the applicants to enter into and cause each of the Macro Parties and Macro Realty Developments Pty Ltd (in liquidation) and Macro Realty Pty Ltd (in liquidation) to enter into the Funding Agreement. 4. Pursuant to s 1322(4)(a) of the Corporations Act, the Funding Agreement is not invalid by reason of having been entered into by the applicants prior to obtaining the approval of this Court. 5. Until further order, and pursuant to ss 37AF(1)(b)(i), 37AF(1)(b)(iv) and 37AF(2) of the Federal Court of Australia Act 1976 (Cth), the Confidential White Affidavit and paragraphs 4, 5, 6 and 16.2 of the applicants' submissions filed on 8 May 2020 are to be marked "confidential" and are not to be published, accessed, or made available to any person seeking to inspect or take copies of the Confidential White Affidavit or the applicants' submissions, from the court file. 6. The costs of this application be costs and expenses in the liquidations of Macro Realty Developments Pty Ltd (in liquidation), Macro Realty Pty Ltd (in liquidation) and the Macro Parties. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT MCKERRACHER J: 1 The liquidators of Macro Realty Developments Pty Ltd (in liquidation) (ACN 159 678 930) (MRD) and Macro Realty Pty Ltd (in liquidation) (ACN 143 381 060) (MR) apply pursuant to s 477(2B) of the Corporations Act 2001 (Cth) and s 90-15 and s 90-20 of Sch 2 of the Act for approval to enter into a litigation funding agreement. 2 The provisions just mentioned are (relevantly) in these terms: 90-15 Court may make orders in relation to external administration Court may make orders (1) The Court may make such orders as it thinks fit in relation to the external administration of a company. Orders on own initiative or on application (2) The Court may exercise the power under subsection (1): (a) on its own initiative, during proceedings before the Court; or (b) on application under section 90-20. Examples of orders that may be made (3) Without limiting subsection (1), those orders may include any one or more of the following: (a) an order determining any question arising in the external administration of the company; b) an order that a person cease to be the external administrator of the company; (c) an order that another registered liquidator be appointed as the external of the company; (d) an order in relation to the costs of an action (including court action) taken by the external administrator of the company or another person in relation to the external administration of the company; (e) an order in relation to any loss that the company has sustained because of a breach of duty by the external administrator; (f) an order in relation to remuneration, including an order requiring a person to repay to a company, or the creditors of a company, remuneration paid to the person as external administrator of the company. Matters that may be taken into account (4) Without limiting the matters which the Court may take into account when making orders, the Court may take into account: (a) whether the liquidator has faithfully performed, or is faithfully performing, the liquidator's duties; and (b) whether an action or failure to act by the liquidator is in compliance with this Act and the Insolvency Practice Rules; and (c) whether an action or failure to act by the liquidator is in compliance with an order of the Court; and (d) whether the company or any other person has suffered, or is likely to suffer, loss or damage because of an action or failure to act by the liquidator; and (e) the seriousness of the consequences of any action or failure to act by the liquidator, including the effect of that action or failure to act on public confidence in registered liquidators as a group. Costs orders (5) Without limiting subsection (1), an order mentioned in paragraph (3)(d) in relation to the costs of an action may include an order that: (a) the external administrator or another person is personally liable for some or all of those costs; and (b) the external administrator or another person is not entitled to be reimbursed by the company or its creditors in relation to some or all of those costs. Orders to make good loss sustained because of a breach of duty (6) Without limiting subsection (1), an order mentioned in paragraph (3)(e) in relation to a loss may include an order that: (a) the external administrator is personally liable to make good some or all of the loss; and (b) the external administrator is not entitled to be reimbursed by the company or creditors in relation to the amount made good. Section does not limit Court's powers (7) This section does not limit the Court's powers under any other provision of this Act, or under any other law. 90-20 Application for Court order (1) Each of the following persons may apply for an order under section 90-15: … (d) an officer of the company; …. (2) Paragraph (1)(d) has effect despite section 198G. Note: Section 198G deals with powers of officers etc. while a company is under external administration. (3) If an application is made by a person referred to in paragraph (1)(b), the reasonable expenses associated with the application are to be taken to be expenses incurred by a person as a member of the committee. … 477 Powers of liquidator … (2B) Except with the approval of the Court, of the committee of inspection or of a resolution of the creditors, a liquidator of a company must not enter into an agreement on the company's behalf (for example, but without limitation, a lease or an agreement under which a security interest arises or is created) if: (a) without limiting paragraph (b), the term of the agreement may end; or (b) obligations of a party to the agreement may, according to the terms of the agreement, be discharged by performance; more than 3 months after the agreement is entered into, even if the term may end, or the obligations may be discharged, within those 3 months. 3 The orders sought by the applicants in their minute of proposed orders are that: (1) Pursuant to r 9.05(1) of the Federal Court Rules 2011 (Cth), Mr Hayden Leigh White and Mr Matthew David Woods, in their capacity as joint and several liquidators (Liquidators) of the following entities, be joined as applicants to these proceedings: (a) Teale WA Pty Ltd (in liquidation); (b) WAH Holdings WA Pty Ltd (in liquidation); (c) Twistjac Pty Ltd (in liquidation); (d) Marchibold Pty Ltd (in liquidation); (e) Andrawartha Pty Ltd (in liquidation); (f) Diep WA Pty Ltd (in liquidation); and (g) Veneman Pty Ltd (in liquidation), (the Macro Purchasers); (2) Pursuant to s 1322(4)(d) of the Corporations Act 2001 (Cth), and s 90-15 of Schedule 2 of the Corporations Act, the period for making an application under s 477(2B) of the Corporations Act for approval of entry into the funding agreement dated 30 March 2020 (being annexure marked 'HLW5' of the confidential affidavit of Hayden Leigh White sworn 1 May 2020) (Confidential White Affidavit) (Funding Agreement) is extended to 1 May 2020. (3) Pursuant to 477(2B) of the Act and s 90-15 and s 90-20 of Sch 2 of the Act, the Liquidators be granted approval nunc pro tunc to enter into the litigation Funding Agreement forming annexure HWL-5 to the confidential affidavit of Mr White sworn 1 May 2020; and (4) Pursuant to s 1322(4)(a) of the Act, the Funding Agreement is not invalid by reason of having been entered into by the applicants prior to obtaining the approval of this Court. 4 Section 1322(4) of the Act relevantly provides: 1322 Irregularities … (4) Subject to the following provisions of this section but without limiting the generality of any other provision of this Act, the Court may, on application by any interested person, make all or any of the following orders, either unconditionally or subject to such conditions as the Court imposes: (a) an order declaring that any act, matter or thing purporting to have been done, or any proceeding purporting to have been instituted or taken, under this Act or in relation to a corporation is not invalid by reason of any contravention of a provision of this Act or a provision of the constitution of a corporation; … (d) an order extending the period for doing any act, matter or thing or instituting or taking any proceeding under this Act or in relation to a corporation (including an order extending a period where the period concerned ended before the application for the order was made) or abridging the period for doing such an act, matter or thing or instituting or taking such a proceeding; 5 Orders are also sought in relation to: (1) protection of confidential affidavit material filed in support of this application; and (2) the costs of the application. BACKGROUND 6 In an affidavit in respect of which confidentiality orders are sought, the basis of a potential claim or claims against a third party is explained. I will deal at the end of these reasons with the basis on which I consider it appropriate to make confidentiality orders in respect of that material on this ex parte application. The Liquidators consider that the Macro Purchasers, MR and MRD (together, the Macro Funded Entities) may have a Claim against the third party of a nature which is expressed in the confidential affidavit and submissions. The Macro Funded Entities have insufficient funds to pursue the Claim. 7 I reach and express no conclusions about the prospects of success of that claim or claims save to observe that on the face of the disclosed material, which presents one side of the story only, for the reasons that follow, the primary relief now sought namely the approval of the litigation funding arrangement is warranted subject to minor amendment. 8 On 30 March 2020, the Liquidators and the Macro Funded Entities entered into the Funding Agreement to fund the Liquidators in pursuing the Claim. THE PRINCIPLES 9 The applicants seek approval of the Funding Agreement pursuant to s 477(2B) as well as s 90-15 and s 90-20 of the Act. It should be noted however, that the task that the Court is required to undertake in exercising its discretion differs with respect to these provisions. 10 In Goyal (liquidator), in the matter of OLI 1 Pty Ltd (in liquidation) [2020] FCA 450, Markovic J noted (at [15]) that the principles concerning the role of the Court in granting approval under s 477(2B) are 'well settled.' Her Honour then adopted the summary of those principles in Deputy Commissioner of Taxation, in the matter of ACN 154 520 199 Pty Ltd (in liq) v ACN 154 520 199 Pty Ltd (in liq) (No 2) [2017] FCA 755 per Gleeson J (at [22]-[26]): 22 The Court's role in considering an application under s 477(2B) is to determine whether it is a proper or bona fide exercise of the liquidator's powers. In Re 7 Steel Distribution Pty Ltd (in liq) (recs and mgrs apptd) [2013] NSWSC 669; (2013) 31 ACLC 13-021 at [17], Black J said: The Court is not concerned, in granting an approval under s 477(2B) of the Corporations Act, with matters of commercial judgment but is concerned to be satisfied that the entry into the agreement is a proper exercise of power and not ill-advised or improper on the part of the liquidator … 23 In Stewart, re Newtronics Pty Ltd [2007] FCA 1375 ("Newtronics"), Gordon J, at [26(4)], cited with approval Austin J's statement in Corporate Affairs Commission v ASC Timber Pty Ltd (1998) 29 ACSR 109 at 118 that, in reviewing the liquidator's proposal, the task of the Court is not "to reconsider all of the issues which have been weighed up by the liquidator in developing the proposal, and to substitute its determination for his in....a hearing de novo", but rather the task of the Court is: … simply to review the liquidator's proposal, paying due regard to his or her commercial judgment and knowledge of all of the circumstances of the liquidation, satisfying itself there is no error of law or ground for suspecting bad faith or impropriety, and weighing up whether there is any good reason to intervene in terms of the "expeditious and beneficial administration" of the winding up … 24 The standard imposed under s 477(2B) concerns an assessment by the Court as to whether entry into the agreement is a proper exercise of power and not ill-advised or improper on the part of the liquidator, rather than involving the exercise of commercial judgment: Re Gerard Cassegrain & Co Pty Ltd (in liq) [2013] NSWSC 257 at [11] per Black J citing McGrath re HIH Insurance Ltd [2010] NSWSC 404; (2010) 266 ALR 642. 25 In Pascoe; re Matrix Group Ltd (in liq) [2011] FCA 1117 at [7], Jacobson J cited with approval the following statement by Austin J of the relevant test in Leigh re King Bros [2006] NSWSC 315 at [23]: Although the court has the statutory task [under s 477(2B)] of giving "approval" to a liquidator's agreement that may end more than three months after it is entered into, the case law shows that the court undertakes something less than a complete "merits review". As Giles J said in Re Spedley Securities Ltd (in liq) (1992) 9 ACSR 83 at 85-6: "... the court is necessarily confined in attempting to second guess the liquidator in the exercise of his powers, and generally will not interfere unless there can be seen to be some lack of good faith, some error of law or principle, or real and substantial grounds for doubting the prudence of the liquidator's conduct." 26 In Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher [2011] FCAFC 89; (2011) 85 ACSR 38 at [24], the Full Court endorsed the following list of factors (identified by Austin J in Leigh re King Bros at [25] and Re ACN 076 673 875 Ltd [2002] NSWSC 578; (2002) 42 ACSR 296 at [17]-[34]) relevant to the Court's assessment of a litigation funding agreement: (1) the prospects of success of the proposed litigation; (2) the interests of creditors other than the proposed defendant; (3) possible oppression; (4) the nature and complexity of the cause of action; (5) the extent to which the liquidator has canvassed other funding options; (6) the level of the funder's premium; (7) consultations with creditors; and (8) the risks involved in the claim. 11 In contrast to the granting of an approval under s 477(2B), the granting of a direction under s 90-15 requires a wider inquiry. The distinction was explained by Connock J in Re Minken Pty Ltd (in liq) [2019] VSC 288 (at [23]-[24]) as follows: 23 Applications for approval under ss 477(2A) and 477(2B) are to be distinguished from applications for directions under s 90-15 of the [Act] and the former ss 511 and 479(3) of the Act. The effect of a direction is to sanction a course of conduct so that the liquidator can adopt that course free from the risk of personal liability for breach. 24 It has been observed that the fact that a direction ― unlike an approval under s 477(2A) or s 477(2B) ― exonerates the liquidator from personal liability, means that a closer examination of the liquidator's decision is required in a directions application than in an approval application. (Citations omitted). 12 In Re One. Tel Ltd and Others (2014) 99 ACSR 247, Brereton J considered the inquiry that the Court must undertake in relation to the former s 511 of the Act (at [36]) as follows: 36 While the court's function under s 511 does not involve it in reconsidering every factor that has informed the liquidator's decision, let alone developing alternatives or deciding whether the court would have made the same decision, the court needs to be satisfied, before making a direction, that the decision is proper and reasonable; at least usually, this will necessitate consideration of the liquidator's reasons, and the process by which the decision has been reached Orders nunc pro tunc 13 In Goyal, Markovic J held (at [16]): Although liquidators should ordinarily seek approval before entering into a long term agreement, the Court can give approval nunc pro tunc in appropriate circumstances: see DCT v ACN 154 520 199 at [27] and the cases cited therein. See also Re Kevin Jacobsen Pty Ltd (in liq) [2016] NSWSC 538 (at [75]); Hamilton, in the matter of ACN 101 634 146 Pty Ltd (in liq) [2014] FCA 687 (at [25]); Chamberlain v RG & H Investments Pty Ltd (No 2) (2009) 76 ACSR 415 (at [22]-[24]). 14 In Krejci (liquidator), in the matter of Community Work Pty Ltd (in liq) [2018] FCA 425, Gleeson J held (at [44]): Courts expect that a liquidator will be aware of their legal obligations and powers, particularly those contained in s 477: Empire at [9]. The policy underlying the requirements of s 477(2B) is to afford some protection to the company's creditors against ill-advised or improper actions on the part of a liquidator: Empire at [12]. 15 In Hayes, in the matter of Denham Constructions Pty Limited (in liq) [2018] FCA 2053, Markovic J observed (at [30]-[31]): 30 The Liquidator applied for an order extending the period for making his application under s 477(2B) of the Act for approval of entry into the various agreements pursuant to s 1322(4)(d) of the Act. I was satisfied that the time for making the application should be extended because there was no substantial injustice that was likely to be caused to any person by the granting of the extension: s 1322(6)(c) of the Act. 31 There is no doubt that the Liquidator ought to have sought earlier approval. A liquidator has certain duties and obligations imposed on him or her by the Act and in discharging his or her office should not only be aware of those duties but ensure that he or she acts diligently to fulfil them. That said, in this instance, the Liquidator's inaction was not a result of dishonesty and is not sufficient in itself to prevent the Court's exercise of its powers to give the agreements retrospective approval: see also, for example, Hamilton, in the matter of ACN 101 634 146 Pty Ltd (in liq) [2014] FCA 687 at [6]-[7]. 16 In addition to an extension of time under s 1322(4)(d) and direction under s 90-15, the applicants also seek an order under s 1322(4)(a) of the Act that the Funding Agreement not be invalid by reason of its execution without prior approval. The order sought in the present case would appear to try and avoid the issues raised by French J (as his Honour then was) in Re Read and Another [2007] FCA 1985 (at [31]-[39]), in relation to extending time under s 1322(4)(d) for approval under s 477(2B) in accordance with the approach taken by Lindgren J in Chamberlain (at [21]-[24]). No creditors meeting 17 In Hancock (liquidator), in the matter of South Townsville Developments Pty Limited (in liq) [2019] FCA 71, Perry J observed (at [20]): Finally, while there has been no consultation with the creditors, that is in order to prevent the Defendants from learning the details of the funding agreement and thereby acquiring an unfair advantage. CONSIDERATION 18 In respect of the application to join the Liquidators in their capacity as the liquidators of the Macro Purchasers as applicants in these proceedings, it is both necessary and appropriate to ensure that the Liquidators have approval to enter into the Funding Agreement on behalf of all of the Macro Funded Entities. 19 In respect of the application pursuant to s 477(2B) and s 90-15 of the Act for nunc pro tunc approval of the applicants' entry into the Funding Agreement, I consider it appropriate to only grant approval under s 477(2B). While the applicants' confidential affidavit does disclose the reasoning behind entry into the Funding Agreement in general terms, I do not consider it appropriate at this stage to grant such a direction under s 90-15 so as to free the liquidator from any personal liability with respect to this course of action. For similar reasons, I do not consider that the order extending the period of time for approval under s 1322(4)(d) also requires a direction under s 90-15 of the Act. This approach accords with the orders made by this Court in Goyal and Hayes in similar circumstances noting as well that orders were made in Hayes under s 90-15 regarding other actions taking by the liquidator but not with respect to the approval of the funding agreement. Finally, the applicants in their submissions and evidence have put forward no reason why the additional reliance on s 90-15 is sought. As such, approval of the Funding Agreement under s 477(2B) should be granted on the basis that: (a) the Macro Funded Entities do not have sufficient funds to pursue the Claim; (b) there is on the basis of confidential evidence disclosed to the Court, which I re-iterate, is only one side of the story, a proper basis for pursuing the claim. It is not a frivolous claim. If the belief expressed in the supporting materials is well founded and there is no proper defence, the claim would appear to enjoy good prospects of success. The authorities do not suggest that the court must be satisfied the claim is bound to succeed; (c) the Funding Agreement will allow the Liquidators to pursue the Claim; (d) pursuit of the Claim may facilitate a recovery of funds which in turn may provide a material return to creditors. There is no other present prospect of any return to the creditors of the Macro Funded Entities; and (e) the Liquidators have acted appropriately, prudently, in good faith and in accordance with their statutory duties. 20 In respect of the application for an order pursuant to s 1322(4)(a) of the Act that the Funding Agreement is not invalid by reason of having been entered into prior to obtaining Court approval, I am satisfied that such orders are appropriate as: (a) no issue arises from the fact that the Funding Agreement was signed before this application was made given that it is a condition precedent to the Funding Agreement that approval be obtained; (b) as a result, there has been no injustice or potential prejudice to creditors of the Macro Funded Entities; and (c) there is a clear potential benefit to the creditors of the Macro Funded Entities if the Liquidators are granted approval to enter into the Funding Agreement. 21 An additional order is sought for an extension of the period for approval under s 1322(4)(d) which will be made, albeit without the direction under s 90-15 of the Act. 22 The applicants also seek an order pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth) that the confidential affidavit of Mr White and paras 4, 5, 6 and 16.2 of their submissions be kept confidential. 23 Section 37AF of the Federal Court Act provides: 37AF Power to make orders (1) The Court may, by making a suppression order or non-publication order on grounds permitted by this Part, prohibit or restrict the publication or other disclosure of: a) information tending to reveal the identity of or otherwise concerning any party to or witness in a proceeding before the Court or any person who is related to or otherwise associated with any party to or witness in a proceeding before the Court; or (b) information that relates to a proceeding before the Court and is: (i) information that comprises evidence or information about evidence; or (ii) information obtained by the process of discovery; or (iii) information produced under a subpoena; or (iv) information lodged with or filed in the Court. (2) The Court may make such orders as it thinks appropriate to give effect to an order under subsection (1). 24 In Hancock, Perry J observed in relation to making a confidentiality order under s 37AF of the Federal Court Act (at [10]): 10 … such orders are commonly made where, as here, a liquidator has obtained litigation funding for proceedings for the recovery of monies. For example, Gleeson J explained in Needham, Re Bruck Textile Technologies Pty Ltd (in liq) [2016] FCA 837: 37 As Barrett J noted in Onefone Australia Pty Ltd v OneTel Ltd [2010] NSWSC 498 at [2], the subject matter of an application of this kind is "commercially confidential and sensitive … related to aspects of the litigation that any plaintiff, protecting its own interests and the integrity of the litigation process in which it is engaged, would take particular care to keep from the other party or parties to the litigation. Those aspects relate to the funding of the litigation". 38 The clear public interest in the due and beneficial administration of the estates of insolvent companies for the benefit of creditors is a relevant consideration in favour of s 37AF orders in this case. 39 In Re Octaviar Administration Pty Ltd (in liq) [2014] NSWSC 344 at [20] to [21], Ball J noted that disclosure of reasons for judgments is an essential aspect of the principle of open justice. On the other hand, his Honour observed, when considering a request for access to reasons for orders made pursuant to s 477(2B) of the Corporations Act 2001 (Cth) approving the entry by the liquidators into a litigation funding deed, it is appropriate to give the liquidators an opportunity to make submissions on which parts of the material to which access is sought is confidential and should remain the subject of a suppression order. Ball J stated: Without intending to be exhaustive, that material would include material that would put the Liquidators in a disadvantageous position compared to that of an ordinary litigant. Disclosure of material of that type would not be conducive to the proper administration of justice. … 25 I consider that such an order is appropriate in this instance as: (a) the confidential affidavit of Mr White and the relevant paragraphs of the applicants' submissions contain information that has not yet been and should not be disclosed to the intended defendant/respondent of the Claim and refers to legal advice obtained by the Liquidators, which is subject to legal professional privilege; and (b) it is not otherwise in the interests of justice that the confidential affidavit of Mr White and the relevant paragraphs of the applicants' submissions be generally available for inspection. CONCLUSION 26 For these reasons I consider that the orders sought should be made in terms of the applicants' minute with the exception that reference to s 90-15 and s 90-20 of the Act be removed from orders 2 and 3 of the orders sought as set out at [3] of these reasons. I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher. Associate: Dated: 14 May 2020