Morgan, in the matter of Traditional Values Management Limited (in liq) [2024] FCA 74

FEDERAL COURT OF AUSTRALIA

Morgan, in the matter of Traditional Values Management Limited (in liq) [2024] FCA 74 File number(s): VID 335 of 2023

Judgment of: BUTTON J

Date of judgment: 13 February 2024

Catchwords: CORPORATIONS – application by liquidator for directions made under ss 90-15 and 90-20 of the Insolvency Practice Schedule (Corporations) (being Sch 2 to the Corporations Act 2001 (Cth)) in relation to an abridged process for handling the claims of investor creditors against company in liquidation – where company against whom claims are to be made former responsible entity of managed investment scheme – where compliance with formal proof of debt process would exhaust all or nearly all funds remaining for distribution – where abridged process would result in return to investor creditors – where proposed abridged process unopposed by any creditors or investors – whether responsible entity entitled to recourse to scheme assets to meet claims of investor creditors – whether abridged process should be "opt out" or "opt in" – whether investors who reinvested distributions should be excluded from abridged process – orders and directions made

Legislation: Australian Securities and Investments Commission Act 2001 (Cth) ss 12DA, 12GF Corporations Act 2001 (Cth) ss 600K, 601GA, 1022A, 1022B, 1041H, 1041I, Sch 2 (Insolvency Practice Schedule (Corporations)) ss 90-15, 90-20 Trade Practices Act 1974 (Cth) s 52 Corporations Regulations 2001 (Cth) regs 5.6.48, 5.6.54

Cases cited: Adsett v Berlouis [1992] FCA 368; (1992) 37 FCR 201 Amand v Bradbourne (1682) 2 Chan Cas 138; 22 ER 884 Australian Securities and Investments Commission v Letten (No 17) (2011) 87 ACSR 155; [2011] FCA 1420 Australian Securities and Investments Commission v Tasman Investment Management Ltd (2006) 59 ACSR 113; [2006] NSWSC 943 Barnden (Liquidator), in the matter of Masonry Works Pty Limited (in liquidation) [2020] FCA 575 Benett v Wyndham (1862) 4 DF&J 259; 45 ER 1183 CB Darvall & Darvall v Moloney (2006) 236 ALR 796; [2006] QSC 345 Gatsios Holdings Pty Ltd v Mick Kritharas Holdings Pty Ltd (2002) ATPR 41-481; [2002] NSWCA 29 Harrison v Nandicorp Pty Ltd [2021] FCA 1603 In the matter of Broens Pty Limited (in liq) [2018] NSWSC 1747 In the Matter of Daily Planet Pty Ltd (in Liq) [2019] VSC 265 ION Limited, in the matter of ION Limited (Subject to Deed of Company Arrangement) [2010] FCA 1119 Kordamentha Pty Ltd v LM Investment Management Ltd [2016] QSC 183 Krejci, in the matter of Union Standard International Group Pty Ltd (Administrators Appointed) (No 2) [2020] FCA 1111 Nolan v Collie (2003) 7 VR 287; [2003] VSCA 39 QB4 Capital Pty Ltd v Guardian Securities Ltd (2023) 411 ALR 496; [2023] FCAFC 72 Re Beddoe [1893] 1 Ch 547 Re Bell Group Ltd (in liq) [2020] WASC 259 Re Glowbind Pty Ltd (in liq) (2003) 48 ACSR 456; [2003] NSWSC 1190 Re Horne (2021) 150 ACSR 565; [2021] VSC 51 Re Magic Aust Pty Ltd (in liq) (1992) 7 ACSR 742 Re Plutus Payroll Australia Pty Ltd (in liq) [2019] NSWSC 1171 Re Raybould [1900] 1 Ch 199 Selim v McGrath (2003) 177 FLR 85; [2003] NSWSC 927 White, in the matter of Mossgreen Pty Ltd (Administrators Appointed) (No 7) [2019] FCA 113 Woodhouse (Liquidator), in the matter of Forex Capital Trading Pty Ltd (in liq) [2022] FCA 600 M Scott Donald, "The 'proper' approach to a trustee's right to indemnity out of trust assets" (2014) 8 J Eq 283