Bryant, in the matter of Gunns Limited (in liq) (receivers and managers appointed) v Edenborn Pty Ltd [2020] FCA 715

FEDERAL COURT OF AUSTRALIA

Bryant, in the matter of Gunns Limited (in liq) (receivers and managers appointed) v Edenborn Pty Ltd [2020] FCA 715 File number: WAD 553 of 2015

Judge: DAVIES J

Date of judgment: 27 May 2020

Catchwords: CORPORATIONS – voidable transactions – unfair preferences – interpretation of s 588FA of the Corporations Act 2001 (Cth) – whether there was a continuing business relationship in the form of a running account – where there was a break in continuing business relationship during the relation back period – whether ultimate effect doctrine continues to apply under s 588FA – peak indebtedness rule applied – good faith defence under s 588FG(2) of the Corporations Act 2001 (Cth) not made out – whether Court has discretion under s 588FF(1) of the Corporations Act 2001 (Cth) not to make order in respect of preferential payments – discretion not exercised on facts of case

Legislation: Acts Interpretation Act 1901 (Cth), ss 2(2), 33(2A) Bankruptcy Act 1966 (Cth), ss 122 Companies Act 1993 (NZ), s 292(4B) Corporations Act 2001 (Cth), Pt 5.7B, Pt 5.9, Div 1, ss 436A, 439C, 588FA, 588FC, 588FE, 588FG(2), 588FF, 1305(1) Evidence Act 1995 (Cth), ss 69, 135, 167, 168(1) Statute Law (Miscellaneous Provisions) Act 1987 (Cth)

Cases cited: Airservices Australia v Ferrier [1996] HCA 54; 185 CLR 483 Australian Securities and Investments Commission v Rich [2009] NSWSC 1229 Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485 at 492 Beveridge v Whitton [2001] NSWCA 6 BP Australia Ltd v Brown [2003] NSWCA 216; 58 NSWLR 322 Bryant (liquidator) v LV Dohnt & Co Pty Ltd, in the matter of Gunns Limited (in liquidation) (receivers and managers appointed) [2018] FCA 238 Bryant, in the matter of Gunns Limited (in liq) (receivers and managers appointed) v Badenoch Integrated Logging Pty Ltd [2020] FCA 713 Bryant, in the matter of Gunns Limited (in liq) (receivers and managers appointed) v Bluewood Industries Pty Ltd [2020] FCA 714 Cashflow Finance Pty Ltd (in liq.) v Westpac Banking Corp [1999] NSWSC 671 Clifton (as liquidator of Adelaide Fibrous Plasterboard Linings Pty Ltd (in liq)) & Anor v CSR Building Products Pty Ltd [2011] SASC 103 CSR Ltd trading as the Readymix Group v Starkey (as liquidator) of Allan Fitzgerald Pty Ltd (in liq) (1994) 13 ACSR 321 Cussen (as liquidator of Akie Pty Ltd) v Commissioner of Taxation [2004] NSWCA 383 Cyberduck Software Pty Ltd (in liq) & Anor [2018] VSC 122 D Pty Ltd (in liq) v Calas (Trustee), in the matter of D Pty Ltd (in liq) [2016] FCA 1409 Federal Commissioner of Taxation v Kassem [2012] FCAFC 124; 205 FCR 156 G and M Aldridge Pty Ltd v Walsh [2000] HCA 27; 203 CLR 662 Great Investments Ltd v Warner [2016] FCAFC 85; 243 FCR 516 Harkness v Commonwealth Bank of Australia Ltd (1993) 32 NSWLR 543 In the matter of Employ (No 96) Pty Limited (in liquidation) [2013] NSWSC 61 Jones v Dunkel [1959] HCA 8; 101 CLR 298 Manzi v Smith [1975] HCA 35; 132 CLR 671 McKern v Minister Administering the Mining Act 1978 (WA) [2010] VSCA 140; 28 VR 1 Olifent v Australian Wine Industries Pty Ltd (1996) 130 FLR 195 Petagna Nominees Pty Ltd v A E Ledger (1989) 1 ACSR 547 Queensland Bacon Pty Ltd v Rees [1966] HCA 21; (1966) 115 CLR 266 Re Discovery Books Pty Ltd (1973) 20 FLR 470 Re Weiss; Ex parte White v John Vicars & Co Ltd [1970] ALR 654 Rees v Bank of New South Wales [1964] HCA 47; 111 CLR 210 Richardson v Commercial Banking Co of Sydney Ltd [1952] HCA 8; 85 CLR 110 Roach & Ors v Page & Ors (No. 11) [2003] NSWSC 907 Sheahan v Fabienne Pty Ltd [1999] SASC 335 Sutherland v Lofthouse [2007] VSCA 197; 214 FLR 157 Sydney Appliances Pty Ltd (in liq) v Eurolinx Pty Ltd [2001] NSWSC 230 Timberworld Ltd v Levin [2015] 3 NZLR 365 VR Dye & Co (a firm) v Peninsula Hotels Pty Ltd (in liquidation) [1999] 3 VR 201