Tolcher v Loiterton and Others [2002] NSWSC 373

New South Wales Supreme Court

CITATION : Tolcher v Loiterton and Others [2002] NSWSC 373 FILE NUMBER(S) : SC 5063/00 HEARING DATE(S) : 16/04/02,17/04/02 JUDGMENT DATE : 3 May 2002

Raymond George Tolcher - Plaintiff/Cross-Defendant PARTIES : John Barrie Loiterton - First Defendant/Cross-Claimant Peter James Loiterton - Second Defendant/Cross-Claimant Ian Robert Hall - Third Defendant/Cross-Claimant JUDGMENT OF : Gzell J

R K Newton for the Plaintiff COUNSEL : R K Weaver for the Defendants Mr Hall in Person SOLICITORS : Walker Insolvency Lawyers Phillip Anthony Biber Lawyer CATCHWORDS : Corporations - deed of company arrangement - construction - valid resolution of meeting of creditors to enforce administration deed - no estoppel against administrator - no representations - reliance upon legal advice and not representations - not unconscionable - lack of clean hands - no breach of Fair Trading Act 1987 LEGISLATION CITED : Corporations Law Fair Trading Act 1987 Re Vanfox Pty Ltd (1994) 13 ASCR 825 Jones v Dunkel (1958-1959) 101 CLR 298 CASES CITED : Waltons Stores (Interstate) Ltd v Maher (1987-1988) 164 CLR 387 at 404 The Commonwealth v Verwayen (1990) 170 CLR 394 at 444-446 Official Trustee in Bankruptcy v Tooheys Ltd (1993) 29 NSWLR 641 DECISION : See pars 27 and 28

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

GZELL J

FRIDAY 3 MAY 2002

5063/00 RAYMOND GEORGE TOLCHER v JOHN BARRIE LOITERTON & OTHERS JUDGMENT 1 The defendants as the directors of Leisuremark Australia Pty Ltd ("Company") resolved to appoint the plaintiff as administrator on 25 August 1998 pursuant to the Corporations Law, s 436A. On 21 September 1998 the second meeting of the creditors of the company was held at which the creditors resolved to accept a proposal for a Deed of Company Arrangement. In accordance with s 444B, the deed was executed on 9 October 1998 as was an associated Administration Deed. The plaintiff claims that the Deed of Company Arrangement is still on foot and that the defendants are liable to pay to him $450,000.00 pursuant to its terms and those of the Administration Deed. The defendants claim that by reason of representations made by and on behalf of the plaintiff, he is estopped from claiming that the defendants are liable to pay $450,000.00. In the absence of prejudice and in order to enable the real dispute between the parties to be determined, I gave leave at a late stage of the proceedings to the defendants to amend their cross-claim to allege that the Deed of Company Arrangement terminated on 31 March 1999 and is no longer enforceable. 2 Clause 2.1 of the Deed of Company Arrangement provided that it was conditional upon the secured creditor agreeing to discharge or assign its security upon payment of $600,000.00 and upon the due execution of the Administration Deed within one month. It is common ground that clause 2.1 was satisfied. Clause 4 of the Deed of Company Arrangement was as follows: "The Administrator shall within 14 days from the date of this Deed of Company Arrangement enter into an Administration Deed with the Company, the Contributors and the Deferred Creditors which shall provide for: (a) the Deferred Creditors to be barred until the termination of this Deed of Company Arrangement from making any claims against the Company; and (b) the Contributors to pay or cause to be paid to the Administrator the total sum $450,000.00 by instalments in the amounts and on or before the respective dates specified in Schedule B ."