Bidald Consulting v Miles Special Builders; Bidald Consulting v Miles Special Builders [2005] NSWSC 1235

New South Wales Supreme Court

CITATION : Bidald Consulting v Miles Special Builders; Bidald Consulting v Miles Special Builders [2005] NSWSC 1235

HEARING DATE(S) : 23/9/05, 26/9/05 & 2/11/05

JUDGMENT DATE : 9 December 2005

JURISDICTION : Equity

JUDGMENT OF : Campbell J

DECISION : Deed terminated. Company wound up.

CATCHWORDS : CORPORATIONS – voluntary administration – Deed of Company Arrangement – termination of – construction of section 445D(1) Corporations Act 2001 – circumstances of application of section 445D(1)(a) and (b) – interrelationship of section 445D(1)(a) and (b) – meaning of "false or misleading" – meaning of "material" – role of informal seeking of views of creditors in deciding materiality – whether failure to call meeting of creditors in circumstances when Deed required it to be called is a material contravention of the Deed – whether winding up proceedings being on foot prevents Deed Administrator from calling meeting of creditors to consider placing company into liquidation – whether a Deed can provide for the de facto winding up of the company – in what circumstances payment of different amounts to creditors bound by a Deed is permissible – role of good faith between creditors in operation of Deed - section 445D(1)(e) does not apply to action contrary to the Deed – relevance of a Deed allowing an insolvent company to continue to trade – relevance of substantial departure in practice from proposal put to creditors at time Deed was adopted – operation of discretion to set aside Deed – relevance of interests of creditors – relevance of public interest – public interest factors which can be taken into account – significance of provision of false or misleading information – whether termination to be affected on application by person said to be a disputed creditor – procedure to achieve winding up by the Court when Deed terminated – BANKRUPTCY – arrangements with creditors without sequestration – composition under the general law – whether, and in what circumstances, special benefits can be provided to one creditor bound by a composition – juristic basis of prohibition on one creditor bound by a composition receiving a special benefit – role of consideration in compositions – CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – consideration – role of consideration in composition between debtor and creditors – juristic basis on which Court prevents one creditor bound by a composition from receiving a special benefit – PROCEDURE – contempt, attachment and sequestration – action out of Court frustrating litigation in Court – when a contempt