Otis Elevator Co Pty Ltd v. Guide Rails Pty Ltd (in liq) & Ors [2004] NSWSC 383

Reported Decision : 49 ACSR 531

New South Wales Supreme Court

CITATION : Otis Elevator Co Pty Ltd v. Guide Rails Pty Ltd (in liq) & Ors [2004] NSWSC 383 HEARING DATE(S) : 6 February, 2004 JUDGMENT DATE : 7 May 2004 JURISDICTION: Equity Division JUDGMENT OF : Palmer J DECISION : Declarations in accordance with reasons for judgment.

CATCHWORDS : CORPORATIONS - LIQUIDATION - DISTRIBUTION OF ASSETS - RULE IN CHERRY V BOULTBEE - WP (a corporation) owed a substantial debt to GR (a corporation) - WP was also a shareholder of GR - WP went into liquidation - subsequently GR went into liquidation with a surplus of assets available for distribution to shareholders - whether liquidator of GR could apply rule in Cherry v Boultbee against liquidators of WP - principles discussed. - ELECTION - whether liquidator of GR lost right to apply rule in Cherry v Boultbee by lodging proof of debt in liquidation of WP - principles discussed. LEGISLATION CITED : - Corporations Act 2001 (Cth) - s.176, s.439A, s.479(3), s.488(2), s.513A, s.513C - Corporations Law - s.436A(1), s.439A(4), s.461 - Borda v Burgess [2003] NSWSC 1171 - Cherry v Boultbee: 4 Myl & Cr 442; (1839) 41 ER 171 - Fenton (No 2), Re; ex parte Fenton Textile Association [1932] 1 Ch 178 - Glowbind Pty Ltd (In Liq), Re; Takchi v Parbery (2003) 48 ACSR 456 - Hodgson (dec'd), Re; Hodgson v Fox (1878) 9 Ch D 673 - Jeffs v Wood (1723) 2 P Wms 28 [24 ER 668] CASES CITED : - G.B. Nathan & Co Pty Ltd (in liq), Re (1991) 24 NSWLR 674 - Orpen, Re (1880) 16 Ch D 202 - Peruvian Railway Construction Company Ltd, Re [1915] 2 Ch 144 - Sargent v ASL Developments Limited (1974) 131 CLR 634 - Sewell, In re; White v Sewell [1909] 1 Ch 806 - Stammers v Elliott (1868) LR 3 Ch App 195 - Wood "English and International Set-off" (1989) para.8-131 Guide Rails Pty Ltd (in liq) - Applicant (First Defendant/Second Cross Defendant) Wood Parsons Pty Ltd - First Respondent (Third Cross Defendant) PARTIES : Otis Elevator Co Pty Ltd - Second Respondent (Plaintiff/First Cross Defendant) East Coast Rail Systems - Second Defendant/First Cross Claimant Colorado Elevators Inc - Third Defendant/Second Cross Claimant FILE NUMBER(S) : SC 4383/00 R.K. Eassie - Applicant COUNSEL : B.J. Coles QC and D. Kell - First Respondent M. Addison (Sol) - Second Respondent (Excused) Coudert Bros - Applicant SOLICITORS : Baker & McKenzie - First Respondent Dibbs Barker Gosling - Second Respondent