New South Wales Supreme Court CITATION : Mann v Furniture Australia Pty Ltd [1999] NSWSC 1232 CURRENT JURISDICTION : Equity FILE NUMBER(S) : 4664/99 HEARING DATE(S) : 11 and 12 November 1999 JUDGMENT DATE : 12 November 1999 PARTIES : John Howard Mann (P) Furniture Australia Pty Limited (D) JUDGMENT OF : Hamilton J COUNSEL : M Hayter, Solicitor (P) R Hugh, Solicitor (D) SOLICITORS : Gordon & Johnstone (P) Hugh & Associates (D) CATCHWORDS : CORPORATIONS [187] - Voluntary administration - Other matters - Termination of voluntary administration - Circumstances in which Court will terminate - Second voluntary administration commenced shortly before and in ignorance of validation of first voluntary admininstration. ACTS CITED : Corporations Law, s 447A CASES CITED : Australasian Memory Pty Ltd v Brien (1998) 45 NSWLR 111 Re Madden (1996) 131 FLR 430; 14 ACLC 913 DECISION : Second voluntary administration commenced shortly before and in ignorance of validation of first voluntary administration terminated. - 2 - THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION HAMILTON J FRIDAY, 12 NOVEMBER 1999 4664/99 JOHN HOWARD MANN v FURNITURE AUSTRALIA PTY LIMITED JUDGMENT HIS HONOUR: 1 Yesterday in circumstances set out in a short judgment I made an order under s 447A of the Corporations Law extending the time for giving notice of a creditors' meeting. That this course is authorised is demonstrated by the authority mentioned yesterday, namely, Re Madden (1996) 131 FLR 430; 14 ACLC 913, and, more importantly, by the decision of the Court of Appeal in Australasian Memory Pty Ltd v Brien (1998) 45 NSWLR 111. Had this order not been made the situation would have been that the administration would have come to an end, the prescribed time having expired the day before the notice was given. 2 The plaintiff administrator has returned to Court today in the following circumstances. Unknown to him, yesterday administrators were appointed under a second voluntary administration, this having occurred a few hours before my order was made. The persons involved believed that the first voluntary administration had come to an end. Those new administrators have been joined by an amended summons as the second and third defendants in the proceedings. Their attitude is that, now that the first voluntary administration has been set back on its course, they do not wish to continue the second voluntary administration or to remain in office. They join the plaintiff in asking me to order under s 447A of the Corporations Law that the second voluntary administration be terminated. 3 I propose to make that order. The only matter that has been raised with me as a problem is the possibility of a move of the relation back date if the company goes into liquidation, as appears quite likely. The question is, does my retrospective validation of the first voluntary administration mean that the second voluntary administration is now to be taken as never having been in effect, or does the fact that no earlier voluntary administration was in fact in effect at the time the second voluntary administration commenced give it such validity as to change the relation back date? 4 I propose despite this difficulty having been raised to make the orders I have foreshadowed, and not to do anything further about any problem as to the relation back date at the moment. The reason for that is it is quite unclear whether the rules as to relation back will or will not have any effect in relation to the present company and, if they do, whose rights may be affected. The situation that has been created is not entirely satisfactory, but I think the best course is simply to do that and reserve liberty to apply, so that, if it becomes appropriate, application may be made to the Court in relation to that matter in the light of the actual circumstances as they become known hereafter. That is the course I propose to follow. …o0o… Last Modified: 06/26/2000 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.