Shafston Avenue Construction Pty Ltd, in the matter of CRCG-Rimfire Pty Ltd (subject to deed of company arrangement) v McCann (No 3) [2021] FCA 938

Federal Court of Australia

Shafston Avenue Construction Pty Ltd, in the matter of CRCG-Rimfire Pty Ltd (subject to deed of company arrangement) v McCann (No 3) [2021] FCA 938 File number: QUD 683 of 2018

Judgment of: REEVES J

Date of judgment: 10 August 2021

Catchwords: INSOLVENCY – where multiple property development corporations lodged Proofs of Debt in the administration of a construction company (CRCG) under Schedule 2 to the Corporations Act 2001 (Cth) (the Insolvency Practice Schedule) – where those Proofs of Debt were wholly rejected by the administrators on various grounds – where the plaintiffs sought orders under s 90-15 of the Insolvency Practice Schedule that their Proofs of Debt be allowed in full – whether certain documentary evidence was admissible per ss 69 and 79 of the Evidence Act 1995 (Cth) – whether the first plaintiff (Shafston) entered into a binding contract with CRCG, such that it was entitled to damages related to alleged non-completion of that contract – whether CRCG was required, per the Letters of Intent it signed with Shafston and the second plaintiff (Baxter) to provide confirmation that those plaintiffs could use the intellectual property in work performed under those Letters of Intent – whether the third plaintiff (Lincoln) was entitled to claim costs relating to the rectification of defects under the contract between it and CRCG – whether Lincoln had proved the existence of defects, or the cost of their rectification – where the Court must be satisfied that the plaintiffs had discharged their onus to prove that the Administrators were wrong to reject their Proof of Debt – where it was agreed that Lincoln was entitled to damages under the contract between it and CRCG for the failure of CRCG to provide certain warranties – what was the correct valuation methodology for the assessment of those damages – where the proper approach to valuation of such damages was to evaluate the probability of hypothetical future loss – applications partially allowed with regard to certain sums relating to the Lincoln defects and warranties claim