Re Regis Towers Real Estate (Administrator Appointed) [2005] NSWSC 603

New South Wales Supreme Court

CITATION : Re Regis Towers Real Estate (Administrator Appointed) [2005] NSWSC 603

HEARING DATE(S) : 21 June 2005

JUDGMENT DATE : 21 June 2005

JURISDICTION : Equity

JUDGMENT OF : Campbell J

DECISION : Time extended. Administrator's fees allowed to be paid under order like that in Re Regis Towers Real Estate [2004] NSWSC 1251

CATCHWORDS : CORPORATIONS - voluntary administration - extension of time for completion of second meeting of creditors - CORPORATIONS - voluntary administration - fees of administrator accruing during lengthy adjournment of second meeting of creditors - whether order to be made allowing administrator to be paid fees from time to time, provided committee of creditors approves

LEGISLATION CITED : Corporations Act 2001 (Cth)

CASES CITED : Re Regis Towers Real Estate [2004] NSWSC 1251

PARTIES : Regis Towers Real Estate (Administrator Appointed) - Applicant

FILE NUMBER(S) : SC 6578/04

COUNSEL : G M Colman - Applicant

SOLICITORS : Coudert Brothers - Applicant

LOWER COURT JURISDICTION :

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION EQUITY LIST

CAMPBELL J

TUESDAY 21 JUNE 2005

6578/04 REGIS TOWERS REAL ESTATE (ADMINISTRATOR APPOINTED) JUDGMENT – Ex Tempore 1 HIS HONOUR: I grant the leave referred to in paragraph 1 of the interlocutory process filed today. 2 This is an application under s 447A of the Corporations Act 2001 (Cth). It relates to the affairs of a company which had carried on the activity of caretaker of a building containing strata title units, under an agreement entered on 6 August 1999 ("the Management Agreement"). 3 A dispute has arisen between the company, and the Owners Corporation of the strata plan of which it is the manager, about whether circumstances have arisen which entitle the Owners Corporation of the strata plan to terminate the Management Agreement. 4 That dispute is one which was set down for hearing before me for four days commencing today. 5 The company is one which had an administrator appointed to it on 17 September 2004. 6 A first meeting of creditors was held on 24 September 2004 at which a committee of creditors was appointed. 7 A second meeting of creditors was held on 14 October 2004 but did not conclude its business. The creditors present at that meeting resolved that the meeting should be adjourned for a period of 60 days. 8 The administrator has wished to sell the management rights arising under the Management Agreement. His attempts to do so have been hindered by the dispute about whether the Owners Corporation has a right to bring those management rights to an end. 9 There have been two orders of the Court which have granted extensions of time in which to conclude the second meeting of creditors. Palmer J on 3 December 2004 made an order approving an extension of the time in which to conclude the second meeting of creditors to 31 March 2005. Bergin J on 17 March 2005 made orders which further extended the time to 30 June 2005. 10 On 10 June 2005, the various parties to the dispute attended a mediation before Sir Laurence Street which resulted in a settlement in principle of the litigation. 11 There are still certain matters which need to be dealt with to bring that agreement in principle into a binding and complete agreement. There needs to be some drafting and negotiation about it, and there also needs to be a meeting of the Owners Corporation. 12 The parties to the litigation which was due to be heard today have agreed in requesting that I not embark on the hearing, and stand the matter over until 25 August 2005. I have acceded to that application. 13 The hope of the administrator is that, by that time, the various steps which need to be taken to bring the agreement in principle into a binding agreement will have been carried out. If that is the case, the result will be that the creditors of the company have available for distribution amongst them the sale price of the management rights, an asset which they would not have if the litigation were to be run, and the company were to lose the litigation. 14 The administrator's view is that it is in the interests of the creditors to allow time to seek to bring to complete fruition the agreement in principle. 15 Under those circumstances, even though it results in the period of adjournment of the second meeting of creditors being in total most unusually long, it is appropriate to grant the application which is made to extend the time for that meeting to be concluded to 30 September 2005. 16 On 14 December 2004, I gave a judgment which in effect allowed the administrator to be paid fees from time to time, provided that a majority in value and number of the committee of creditors approved the amount of his fees, after proper notice of his claim for fees had been given to them: Re Regis Towers Real Estate [2004] NSWSC 1251. 17 For more abundant caution, the administrator seeks that I make an order in similar terms today. 18 I am not entirely convinced that the making of the order is necessary, but there might possibly be an argument that my earlier order should be construed by reference to the facts existing at the time it was made, and does not cover the longer period of administration which I have now decided to allow. To deal with that possible argument, it is probably desirable to make the order, and I can see no harm in it being made. 19 I make orders in accordance with the draft order which I initial, date today's date and shall place with the papers. 20 These orders may be entered forthwith. 21 I grant leave to the legal representatives of the administrator to uplift a copy of the orders for the purpose of its being taken out. **********