Algeri, in the matter of Gem Management Group Pty Ltd (in liq) [2022] FCA 1229

FEDERAL COURT OF AUSTRALIA

Algeri, in the matter of Gem Management Group Pty Ltd (in liq) [2022] FCA 1229 File number: VID 280 of 2022

Judgment of: MCEVOY J

Date of judgment: 17 October 2022

Catchwords: CORPORATIONS – the company, in its capacity as trustee of a trust, owned property and appeared to have operated an unregistered managed investment scheme whereby investors would fund the purchase of a property – where liquidators are appointed by ASIC to the company in liquidation – where the liquidators conducted investigations to determine the interests of various investors in the trust who contributed to the purchase, development or maintenance of the property – where the task was complex and so the liquidators cannot be certain of their conclusions – where the liquidators seek orders that they are justified in adopting a particular course of action – where no party appeared in opposition to the application – orders made that the net sale proceeds of the property, after secured creditors have been paid, is first paid to the liquidators' costs and unsecured trade creditors – remainder of the funds are paid on the basis of a pro rata distribution method, where the funds are distributed proportionally to the investors' claims as assessed by the liquidators – where all those who intended to invest in the scheme, regardless of their method of investment, are included in this distribution method.

Legislation: Corporations Act 2001 (Cth) ss 9, 601ED, 1318; Sch 2, s 90-15 Federal Court of Australia Act 1976 (Cth) s 23 Trustee Act 1925 (NSW) Trustee Act 1958 (Vic) ss 63, 63A, 67

Cases cited: Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559; [2001] HCA 1 Australian Securities and Investments Commission v Enterprise Solutions 2000 Pty Ltd [2001] QSC 082 Australian Securities Investments Commissioner v Letten (No 7) (2010) 190 FCR 59; [2010] FCA 1231 Australian Securities and Investments Commission v Nelson (2003) 44 ACSR 719; [2003] NSWSC 129; Australian Securities Investments Commission v Tasman Investment Management Ltd (2006) 202 FLR 343; [2006] NSWSC 943 Devaynes v Noble (1816) 1 Mer 572 Hodges v Waters (No 7) (2015) 232 FCR 97; [2015] FCA 264 Lehman Brothers International (Europe) (in admin) v CRC Credit Fund Ltd [2010] EWCA Civ 917 Re French Caledonia Travel Services Pty Ltd (in Liq) (2003) 59 NSWLR 361; [2003] NSWSC 1008 Re Wakim; Ex parte McNally (1999) 198 CLR 511; [1999] HCA 27 Stack v Coast Securities (No. 9) Pty Ltd (1983) 154 CLR 261; [1983] HCA 36