JA Pty Limited & 1 Ors v Jonco Holdings P/L & 2 Ors [2000] NSWSC 147

Reported Decision : [2000] 33 ASCR 691

New South Wales Supreme Court

CITATION : JA Pty Limited & 1 Ors v Jonco Holdings P/L & 2 Ors [2000] NSWSC 147 CURRENT JURISDICTION: Equity FILE NUMBER(S) : SC 2098/99 HEARING DATE(S) : 28/10/99, 29/10/99, 02/11/99, 03/11/99, 18/11/99, 02/02/00 JUDGMENT DATE : 10 March 2000

JA Pty Limited (ACN 009 990 738) (First Plaintiff) Otterton Investments Pty Limited (Second Plaintiff) PARTIES : Jonco Holdings Pty Limited (ACN 003 474 799) (subject to Deed of Company Arrangement) (First Defendant) Richard Porter (Second Defendant) Salvatore Coco (Third Defendant) JUDGMENT OF : Santow J

J E Thomson (Plaintiffs) COUNSEL : P R Dutney, QC (First and Third Defendants) C R C Newlinds (Second Defendants) Gordon & Johnstone (Plaintiffs) SOLICITORS : Colwell Wright, Solicitors (First and Third Defendants) Cunich Business Lawyers (Second Defendant) CATCHWORDS : CORPORATIONS — Deed of Company Arrangement — Application in relation to a trading trust trustee to set aside deed on a number of grounds — Misleading and deceptive information, material non-disclosure, deed unfair, oppressive and discriminatory — Relevance of comparative return under liquidation versus deed and onus of proof — Administrator opposed to Deed not having been given essential company records and prevented by vote from seeking adjournment of meeting to clarify extent of plaintiff creditors' right of proof — Circumstances of voting including "in-house" votes — Trustee's right of recourse to trust assets purportedly excluded — Trustee's right to exoneration and indemnity not effectively excluded — Capacity to exclude — Allegation that trustee's retirement not effected in accordance with deed — Possible duty of administrator to seek directions — Statutory grounds under Corporations Law to terminate inter alia under s445D or declare deed void under s445G — No delay. LEGISLATION CITED : Corporations Law s436A; s439A; s445D; s445G; s447A; s588FB; Pt 5.3A Corporations Law Regulations Regulation 5.6.21 Re ADM Franchise Pty Ltd (1983) 7 ACLR 987; 1 ACLC 987 Bennett v Wyndham (1862) 4 DF&J 259; 45 ER 1183 Commissioner of Stamp Duties (NSW) v Buckle (1998) 192 CLR 226; (1995) 38 NSWLR 574 DFC of T v Comcorp Australia Ltd (1996) 14 ACLC 1,616 Ex parte Edmonds (1862) 4 De GF&J 488; 45 ER 1273 Elders Trustee v Reeves (1987) 78 ALR 193 Employers' Mutual Indemnity (Workers Compensation) Ltd v TST Transport Services Pty Ltd (1997) 15 ACLC 314 Re G B Natham & Co Pty Limited (In Liquidation) (1991) 24 NSWLR 674 Ex parte Garland (1803) 10 Ves Jun 111; 32 ER 786 Glennon v Federal Commissioner of Taxation (1972) 127 CLR 503 CASES CITED : Hagenvale Pty Ltd v Depela Pty Ltd (1995) 17 ACSR 139 Jones v Dunkel (1959) 101 CLR 298 Kalon v Sydney Land Corporation (No. 2) (1998) 16 ACLR 540 Kemtron Industries Pty Ltd v Commissioner of Stamp Duties [1984] 1 Qd R 576 Khoury v Zambena Pty Limited [1999] NSWCA 402 Lam Soon Australia Ltd v Molit (No 55) Pty Ltd (1996) 14 ACLR 1,737 Margison v Potter (1976) 11 ALR 64 Octavo Investments Pty Limited v Knight (1979) 144 CLR 360 re Raybould; Raybould v Turner [1900] 1 Ch 199 Shirlaw v Taylor (1991) 31 FCR 222 Re Suco Gold Pty Limited (In Liquidation) (1983) 33 SASR 99 Universal Distributing Co Ltd (In Liquidation) (1933) 48 CLR 171 DECISION : Deed of Company Arrangement terminated.