New South Wales Supreme Court CITATION : Nicholas James Crouch & Anor v Lynne Adams & Ors [2006] NSWSC 1029 HEARING DATE(S) : 18/09/06 JUDGMENT DATE : 28 September 2006 JURISDICTION : Equity Division Corporations List JUDGMENT OF : White J DECISION : Order that short minutes of order be brought in in accordance with these reasons. CATCHWORDS : CORPORATIONS – Winding-up – Applications to Court by liquidator for directions – Company carried on business of buying, selling, leasing and managing vending machines – Liquidator seeks directions pursuant to s 511 Corporations Act 2001 (Cth) as to basis on which he should deal with vending machines in company's possession - SALE OF GOODS – Passing of property – Company in liquidation sold vending machines to claimants – Claimants entered into management agreements with company upon paying purchase price – Company kept inadequate records of vending machines purchased, sold, leased and managed – Where specific vending machines can be matched to specific contracts and there is only one claimant – Liquidator justified in treating such claimants as legal owners – Where specific vending machines are claimed by multiple claimants and it is possible to identify order of sale – Liquidator justified in treating last purchaser as legal owner – Where specific vending machines are claimed by multiple claimants and it is not possible to identify order of sale – Liquidator justified in selling vending machines and distributing proceeds to claimants pari passu – Where not possible to identify ownership of specific vending machines – Liquidator justified in selling vending machines and distributing proceeds to claimants pari passu – Where claimants entered into buy-back contracts with company and contracts not capable of specific performance – Liquidator justified in acting on basis that claimants have no lien over vending machines. LEGISLATION CITED : Sale of Goods Act 1923 (NSW) Corporations Act 2001 (Cth) In Re Universal Distributing Co Limited (in liquidation) (1933) 48 CLR 171 Commonwealth Bank of Australia v Butterell (1994) 35 NSWLR 64 Shirlaw v Taylor (1991) 1 FCR 222 Crouch v Abell [2005] NSWSC 1308 Pacific Motor Auctions Pty Ltd v Motor Credits (Hire Finance) Pty Ltd (1965) 112 CLR 119 Garners Motor Centre Newcastle Pty Ltd v Natwest Wholesale Australia Pty Ltd (1987) 163 CLR 236 CASES CITED : Spence v Union Marine Insurance Co Limited (1868) LR3CP 427 Re Stapylton Fletcher Limited (1994) 1 WLR 1181 Wait v Baker (1848) 2 Exch 1 Carlos Federspiel & Co SA v Charles Twigg & Co Limited & Anor (1957) 1 Lloyds Rep 240 Re Wait (1927) 1 Chancery 607 at 636; In Re London Wine Co Limited (1986) PCC 121 Re Goldcorp Exchange Limited; Kensington v Liggett (1995) 1 AC 74 Hewett v Court (1983) 149 CLR 639 Nicholas James Crouch & Anor PARTIES : v Lynne Adams & Ors FILE NUMBER(S) : SC 4630/06 COUNSEL : Plaintiff: S Golledge Defendants: N/A SOLICITORS : Plaintiff: Douros Lawyers Defendant: N/A IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST WHITE J Thursday, 28 September 2006 4630/06 Nicholas James Crouch v Lynne Adams & Ors JUDGMENT 1 HIS HONOUR: The first plaintiff is the liquidator of VIP Vending Pty Ltd (in liquidation) ("the company"). The company carried on business of buying, selling, leasing and managing vending machines. The machines comprised a range of electronic coin-operated vending machines, which dispense drinks, snack foods and the like. The company was placed into administration on 26 July 2006. At the second meeting of creditors on 22 August 2006, it was resolved that the company be wound up. 2 The company kept inadequate records of the machines which it had purchased and sold and which it had leased and managed. The company's practice was to sell the vending machines to investors. In many cases, the contract of sale was only documented by an invoice; sometimes, a purchase agreement was brought into existence. The purchase agreement was, relevantly, in the following terms: " Please supply the following vending machines in the quantity specified. " 3 The form then made provision for the quantity of machines to be sold, the cost and other details. 4 The machines sold were delivered to different locations where an occupier of a site, such as a shop, had agreed to take the machine. In some cases, the invoice identified a machine by serial number. In most cases, it did not. In a few cases, the serial number for a machine sold to an investor is recorded on the investor's file. 5 The usual practice was for prospective purchasers to place a deposit on a machine. Once the company identified a suitable site for the location of the machine, it required full payment for the machine. When the purchaser paid the balance of the purchase price, the purchaser also entered into a management agreement with the company. 6 The usual form of such an agreement provided that the company would pay to the purchaser a rental income of a stipulated amount per month. During the currency of the management agreement, the company was entitled to the income derived from sales made through the machines. The investor was to receive a regular monthly return by way of rent. Categories of Claimants 7 The claims of investors fall into a number of categories. The first category comprises cases where the contract was for the sale of a specific machine or machines, identified by serial number, or by some other specific identifying feature. Such a serial number might appear from the invoice, or from the management agreement. It is clear that, in such a case, the contract was for the sale of specific goods within the meaning of the Sale of Goods Act 1923 (NSW), or was for the sale of ascertained goods (In re Wait [1927] 1 Ch 606 at 630), or the company appropriated an identifiable machine to the contract. In any such case, upon payment, property in the machine passed to the purchaser. 8 The second category of case is similar to the first, in that there was a contract for sale of specific or ascertained goods, or an appropriation of goods, which can now be identified, to a particular contract, but there were successive sales of identified machines to more than one buyer. 9 The liquidator's investigations disclosed, as I understand it, that there are seventy-six machines which have been sold, or purportedly sold, by the company, either twice or, in some cases, up to four times, to different investors. This category of claims raises questions of priority between successive buyers. 10 The third category of case is where it is not possible, because of the company's inadequate record-keeping, to identify particular machines as having been appropriated to individual contracts. In this class of case, investors can show that they bought one or more machines and that the company entered into management agreements with them in respect of those machines. The machines are identified by description. However, it is not possible for the liquidator to identify which machines of that general description were bought and hired out to the company pursuant to the management agreements. The company does not have in its possession as many machines as it would need to satisfy the claims of all of the investors of this class. 11 The fourth category of claim is by investors from whom the company had agreed to buy back a machine or machines, but where the "buy back" agreement has not been completed, and money is still owed by the company to the original purchaser of the machine. 12 There is another class of claimants, namely, those who have paid a deposit towards the purchase of the machine, but where no purchase agreement or management agreement was concluded, and no machine was appropriated to the contract. These persons are unsecured creditors of the company for the amounts of their deposits. Directions 13 The liquidator now seeks directions pursuant to s 511 of the Corporations Act 2001 (Cth) as to the basis on which he would be justified in dealing with the vending machines in the company's possession. 14 On 29 July 2006, the liquidator (then the administrator) entered into a licence agreement with a third party, Nicholls Engineering Pty Ltd. Under that agreement, Nicholls Engineering took over all of the management agreements that the company was administering at the time of the administrator's appointment. Nicholls Engineering has foreshadowed that it might terminate that agreement. The matter is urgent because the liquidator will wish to sell the machines if he can do so, or otherwise distribute them in specie to the persons entitled to them. If the machines are no longer serviced, there is a real risk that the occupiers of premises on which they are located may throw them out, and they may become worthless. 15 The liquidator proposed to the investors that he would seek orders that he distribute in specie those vending machines where the owner had been identified, subject to his receiving his costs of recovery and distribution of the machines. He also proposed seeking orders that he sell those machines where no owner has been identified and distribute the sale proceeds, less costs incurred in respect of the recovery and sale of the machines, on a pro rata basis. The overwhelming majority of investors have agreed to this proposal. 16 In the originating process, the liquidator sought declarations as to the title to the machines. All of the known investors (who number in the hundreds) were named as defendants. However, the liquidator has confined the present application to one for directions pursuant to s 511 of the Corporations Act. 17 The only binding effect of such directions is that: " ... the liquidator, if he has made full and fair disclosure to the Court of material facts, will be protected from liability for any alleged breach of duty as liquidator to a creditor or contributory or to the company in relation to anything done by him in accordance with the direction. " (Re G B Nathan and Co Pty Ltd (in liquidation) (1991) 24 NSWLR 674 at 679.) 18 Nonetheless, having regard to the large number of claims and, in many cases, the comparatively small amount which may be at stake for the investors, the directions may well have the practical effect of dictating the course of the liquidation and the amounts different classes of investors receive. First Category – Sales of Identified Machines 19 I turn to the first category of claimants. As I have said, it is clear that, in respect of this class, the investor became the legal owner of the machine upon, at the latest, payment for the machine and the appropriation of the identified machine to the contract. Where a specific machine can be matched to a specific contract and where there are not multiple claims to the same machine, the liquidator is justified in acting on the basis that that investor is the legal owner. Liquidator's Lien 20 The liquidator is also justified in acting on the basis that he is entitled to a lien for reasonable remuneration for work done in the identification, preservation, or realisation of the property. That lien is enforceable against the property which the liquidator has identified, preserved or realised, notwithstanding that the property belongs to the investors and not to the company (Re Universal Distributing Co Limited (in liquidation) (1933) 48 CLR 171 at 174-175; Commonwealth Bank of Australia v Butterell (1994) 35 NSWLR 64 at 70-71; Shirlaw v Taylor (1991) 31 FCR 222 at 228; Crouch v Abell [2005] NSWSC 1308 at [8]). 21 The liquidator has proposed raising voluntary levies. Most creditors have assented to this proposal. I am satisfied as to the reasonableness of the costs and expenses on the basis of which the levy has been calculated. I will, therefore, direct that the liquidator is justified in delivering machines to which a single claimant can establish title by the presence of a unique serial number in either a purchase agreement, or management agreement, or invoice, or other company record, or by some other identifying feature, on payment of the levy. 22 The liquidator would also be justified in selling such machines if he had the consent of the investor concerned. 23 The liquidator would also be justified in not delivering such machines to such an investor if the investor has not agreed to pay the levy. In such a case, the liquidator, on giving notice to the affected investor, may apply for an order authorising him to sell the machine to give effect to his lien. Second Category – Multiple Purchasers 24 I deal next with the second category of case, that is, where there are multiple claimants to identified machines. The evidence on this application is that the sale of machines to investors was accompanied by their entering into the management agreement with the company pursuant to which the company took possession of the machines. Accordingly, in this class of case, machines have been sold to successive investors and it is possible to identify that a particular machine has been bought by an investor because of a serial number, or other identifying feature, recorded in the company's records, and the machine, which was the subject of a management agreement, has also been sold to another buyer. 25 Where it is possible to identify the order of sales, and where the machine has remained at all times in the possession of the company pursuant to a management agreement, then the liquidator is justified in acting on the basis that the last purchaser acquired title to the machine. Subsection 28(1) of the Sale of Goods Act provides: " 28 Seller or buyer in possession after sale (1) Where a person having sold goods continues or is in possession of the goods or of the documents of title to the goods, the delivery or transfer by that person or by a mercantile agent acting for that person of the goods or documents of title under any sale pledge or other disposition thereof to any person receiving the same in good faith and without notice of the previous sale shall have the same effect as if the person making the delivery or transfer were expressly authorised by the owner of the goods to make the same. " 26 In this category of case, the machine would have been left in the possession of the company as bailee under the management agreement, notwithstanding that it had sold the goods. There would have been no break in the continuity of physical possession. It is irrelevant to the operation of subs 28(1) that the title pursuant to which the company had possession changed, such that it assumed possession as hirer under the management agreement (Pacific Motor Auctions Pty Ltd v Motor Credits (Hire Finance) Pty Ltd (1965) 112 CLR 192 at 202). 27 A subsequent sale of the machine to another investor, accompanied by a new hiring under the management agreement would, prima facie, be a delivery, or transfer, by the seller in possession. Such a new buyer, who received the goods in good faith and without notice of the previous sale, would acquire a good title pursuant to subs 28(1). Although there would be no physical delivery to, or receipt by, the new investor of the machine, the entry into a new management agreement would, prima facie, amount to constructive delivery and receipt (Gamer's Motor Centre (Newcastle) Pty Ltd v Natwest Wholesale Australia Pty Ltd (1987) 163 CLR 236 at 245, 246, 251, 255, 261). 28 Where it is possible to ascertain title to goods, the law has not adopted the mechanism of allocating the goods, or the proceeds of sale, pari passu between innocent claimants. Except with the consent of rival claimants, I do not think the liquidator would be justified in distributing the machines, or their proceeds of sale, pari passu. If the liquidator has obtained the consent of all rival claimants to a particular machine or machines being sold and the proceeds divided pari passu, or to the machines being divided in specie pari passu (which could arise where multiple machines were the subject of contracts), the liquidator would be justified in acting on those consents. 29 I will deal later in these reasons with the position where it is not possible, after reasonable inquiry, to ascertain the order of sales to identified machines. That is a practical problem because the order of sale will depend upon the order in which payment was made for the particular machines. Even where there are dated invoices, it does not follow that the liquidator can rely only on the invoice to ascertain the respective dates of sale. It may not be possible to match receipts from investors to particular contracts, particularly where investors have had a number of dealings with the company. 30 My previous remarks were deliberately addressed to the situation where it is possible to identify the order of sale. Remaining with this class of case, that is, where it is possible to identify the order of sale, as the legal title to the machines will, prima facie, be vested in the last claimant, the liquidator would only be entitled to sell the machines with the consent of the owner, or pursuant to an order for sale if the liquidator seeks to exercise his lien. 31 The liquidator, in this class of case, would be justified in distributing such machines to the last purchaser, unless he has information to suggest that such purchaser had notice of a previous sale of the particular machine which is the subject of his contract. Except in such a case, the liquidator would be justified in delivering the machine to the last purchaser on payment of the levy. He would also be justified in withholding delivery if the levy is not paid, in order to assert his lien. Third Category – Machines Sold Not Capable of Identification 32 I turn then to the third category of machines, namely, where it is not possible to identify the ownership of particular machines. This problem arises because the company records do not show the allocation of an identifiable machine to particular investors. 33 In respect of this category, the liquidator seeks a direction that: " The remaining machines may be distributed amongst those claimants (hereinafter the unsatisfied claimants) who can produce evidence which establishes that the company had possession of a vending machine pursuant to a management agreement at the commencement of the winding up, but neither the claimant, nor the liquidator can establish ownership or a claim to ownership of a particular machine, or can establish ..., ownership, or a claim to ownership of a particular machine. Those machines may be distributed pari passu amongst the unsatisfied claimants in the proportion which their claim (valued by reference to the total number of machines which the individual claimant can demonstrate were held by the company under management as at 26 July 2006) bears to the total of the unsatisfied claims. " 34 In relation to this category, counsel for the liquidator submitted: " Similarly title in the unallocated machines has passed from the company to the investors (owners) but it is not possible to match a particular investor/owner with a particular machine. They are to be treated therefore as owners, as tenants in common of the entire bulk in the proportion that each investor's purchase bears to the overall claims of all investors in these categories. Re Staplyton Fletcher Limited , or they are to have the benefit of the remedial trust remedy as was applied to the wine bottles by Justice Campbell in the Crouch decision." 35 The goods in this class of case are unascertained goods, title to which would not pass to an investor, unless there were an unconditional appropriation of the goods to the contract by the company (the seller), with the assent of the investor (the buyer) (Sale of Goods Act, ss 21 and 23). 36 There is an important distinction between there being no appropriation of goods to a contract and its being impossible now to determine what goods were appropriated to an individual contract. It does not follow that because the liquidator cannot now determine which machines were appropriated to which contract, that no appropriation occurred. If there were an appropriation, the property in the machines, both at law and in equity, passed to the individual buyers. If there were not, then, in my view, property in the machines, both at law and in equity, remained with the company. 37 Where property passed to the buyers, but it is not possible now to identify which machines belong to which buyer, in my view, the buyers are entitled at law, as tenants in common, to a proportionate interest in the total number of such machines as can now be identified as being in the company's possession, but as having been appropriated to some buyer (Spence v Union Marine Insurance Co Limited (1868) LR 3 CP 427 at 438; Re Stapylton Fletcher Limited [1994] 1 WLR 1181 at 1199-1200). 38 Appropriation requires the assent of the buyer. However, a buyer may assent in advance by agreeing to the seller's making a selection of the goods to which the contract will attach. If the buyer assented to the company's appropriating some machine of the kind the buyer purchased, and which then became the subject of a management agreement, it does not matter that the buyer did not know the details of the machine so appropriated. It would be sufficient that the buyer assented to the company making the selection and the company did so (Wait v Baker (1848) 2 Exch 1 at 7; Carlos Federspiel & Co SA v Charles Twigg & Co Limited & Anor [1957] 1 Lloyds Rep 240 at 255). 39 The evidence of Mr Stringer, who worked for the company from about August 1998, was that the practice of selling and identifying machines was as follows: "5. Locating sites involved visiting locations, cold calling on companies around Sydney and speaking to the relevant person about placing a machine managed by VIP. … 6. The process then was that, once a site was located, a purchaser was advised and was required to come to the VIP office and pay the balance of the purchase price and execute the Management Agreement. 7. I believe that VIP would then pay the supplier of the vending machine who would then deliver the machine to VIP. Once machines were delivered to VIP by the supplier the vending machine were (sic) then delivered to a located site. Delivery of vending machines could take up to 5 weeks. " 40 This evidence shows that the company's practice was to appropriate particular goods to an individual purchaser's contract. Each contract was entered into by reference to a particular site at which a machine was to be located. A machine was bought in order to be placed on that site. This necessarily involved the selection of a particular machine to a particular contract. Accordingly, in the present case, the question is not one of there being an absence of appropriation of machines to a contract, but the lack of records to ascertain what appropriation was made. 41 Accordingly, it is unnecessary to consider whether, in the absence of appropriation, the company might have held the goods on a remedial constructive trust for the benefit of all of the purchasers of goods of that description in proportion to their respective claims (Crouch v Abell at [6]). I respectfully find it difficult to reconcile that approach with authorities such as In Re Wait at 636, In Re London Wine Co Limited (1986) PCC 121 at 142, and In Re Goldcorp Exchange Limited [1995] 1 AC 74. If no property passed to a purchaser, and no trust was created at the time of sale and payment because the subject matter of the trust was not identified, it is, with respect, difficult to see what scope there is for the imposition of a remedial constructive trust, which would operate to the prejudice of other creditors who would become disentitled from having recourse to the assets of such a trust. However, in the view I take, it is not necessary to pursue that question further. 42 The absence of records means that one cannot be sure that the practice deposed to by Mr Stringer was always followed. Nonetheless, the liquidator is justified in assuming that it was, and that title passed to the purchasers, even though it is impossible now to identify the purchasers of particular machines. 43 I accept the submission of counsel for the liquidator that machines in this class are held by the claimants as tenants in common in the proportion which the investor's claim bears to the total claims of this class, and that such proportion should be applied to the total number of machines of this class which the company held under management at the commencement of the administration on 26 July 2006. The liquidator is justified in proceeding on the basis that claimants in this class hold the legal title to the machines as tenants in common. If they acted jointly, they would be entitled to sell the machines, which are held in common, and divide the proceeds. An investor or investors of this class would also be entitled to an order for division (including sale) of the goods pursuant to s 36A of the Conveyancing Act 1919 (NSW). 44 The liquidator will be entitled to a lien for his remuneration and expenses in identifying and preserving the machines and in realising their proceeds, if he were to sell them. He is not entitled to sell the machines, except with the consent of the legal owners, or pursuant to an order for sale to give effect to his lien. 45 Nonetheless, it is plainly in the interests of the individual owners that the machines be sold. In a practical sense, I expect the liquidator is the only person in a position to do so. If they were not sold by the liquidator, they may well be thrown out and the legal owners may recover nothing. 46 Because the liquidator would be entitled to sell the machines to give effect to his lien, and because a sale would be in the interests of the legal owners, I direct the liquidator that, if a partition is not feasible, or is not consented to, he would be justified in selling the machines and distributing the proceeds of sale after satisfaction of his lien to this class of investors pari passu. If a partition is feasible and is agreed to, the liquidator is justified in making a distribution between these claimants pari passu upon payment of the voluntary levy in respect of the machines. However, partition requires the consent of all of the affected investors. The liquidator is also justified in not making such a distribution if the claimants have not agreed to pay the levy. Multiple Claimants Where Order of Sale Cannot be Ascertained 47 I will now return to the case of multiple claimants to identified machines, that is, the second category of case, where it is not possible, after reasonable enquiry, to identify the order of sale. 48 The same principles apply to such a case as they do to the third category, that is to say, it is known that title to the machine has passed to one or some investors, and does not rest with the company, but it is not possible to identify who is entitled. 49 In my view, the reasoning in Spence v Union Marine Insurance Company Limited leads to the conclusion that, in such a case, the liquidator would be justified in treating such claimants pari passu. However, that will only be the position once it is known that the order of sale cannot be ascertained after reasonable inquiry. Fourth Category – Buy-Back Arrangements 50 I turn to the fourth category of claimants, namely, persons who entered into buy-back arrangements. According to the information given by the company's director to the liquidator, when an investor wanted to sell his or her machine back to the company, the sale price was agreed by reference to the machine's age. The company then entered into an agreement to buy back the machine via twenty-four equal monthly instalments. When the buy-back was agreed, the company relocated the machines to a different site. The person from whom the machine was bought back was not advised where the machine was relocated. All of the revenue from the machine went to the company. The investor received his or her agreed monthly buy-back payment, which was different from the rental payment under the management agreement. 51 The example of a buy-back agreement in evidence does not specify when title in the machine passed from the investor (as seller) to the company (as buyer). The relevant terms were: " In consideration for the sum of X dollars receipt whereof is acknowledged, the vendor agrees to sell to the purchaser (i.e. the company) and the purchaser agrees to buy the machines. The vendor acknowledges that any stock shall remain in the machine as agreed between the parties. ... The parties acknowledge that the buy-back will be for a term of 24 calendar months commencing ... and concluding on ... as agreed. The vendor agrees to accept monthly instalments over the 24 months calculated at Y dollars per month. " 52 Section 22 of the Sale of Goods Act provides that, where there is a contract for the sale of specific or ascertained goods, the property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred. Subs 22(2) provides: " 22 Property passes when intended to pass … (2) For the purpose of ascertaining the intention of the parties regard shall be had to the terms of the contract, the conduct of the parties, and the circumstances of the case. " Section 23 provides: " 23 Rules for ascertaining intention Unless a different intention appears, the following are rules for ascertaining the intention of the parties as to the time at which the property in the goods is to pass to the buyer. Rule 1. Where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment or the time of delivery, or both, be postponed. " 53 In my view, the liquidator is justified in proceeding on the basis that title to the goods bought back by the company passed on entry into the buy-back agreement. The agreement itself, at one point, contains an acknowledgment of receipt of the purchase price, although, later, it is agreed that the vendor would accept monthly instalments for a period of twenty-four months. The acknowledged receipt of the purchase price appears only to be of relevance in determining the question of when title passed. 54 The surrounding circumstances, as summarised above, and the conduct of the parties, also suggest that it was the intention of the parties that, from the time the buy-back agreement was entered into, ownership of the machine would pass back to the company. The company thereafter enjoyed the proceeds of sales from the machines, notwithstanding that the management agreement had been terminated. 55 Such investors were unpaid sellers. However, they had no statutory right to a lien in respect of the unpaid debt (Sale of Goods Act, s 42). In Electrical Enterprises Retail Pty Ltd v Rodgers (1989) 15 NSWLR 473, Kearney J considered that, in this respect, the Sale of Goods Act was not a code and that, in an appropriate case, an unpaid vendor may be entitled to assert an equitable lien (at 492-493). However, his Honour held that he was bound by the reasons of Gibbs CJ and Wilson and Dawson JJ, in Hewett v Court (1983) 149 CLR 639 at 649 and 658, that a vendor's lien in equity is only available in respect of contracts which are capable of specific performance. The buy-back agreements are not contracts capable of specific performance. 56 Accordingly, the liquidator is justified in proceeding on the basis that such unpaid sellers do not have a lien over the goods for the unpaid amount of the purchase price. Remaining Machines 57 The liquidator will be justified in selling machines in the possession of the company, which are not the property of any investor or investors. They will be the property of the company. The proceeds of sale of the machines should be available for distribution amongst unsecured creditors generally. Liquidator's Remuneration 58 The liquidator also seeks an order approving the payment of his costs and expenses. As at 7 September 2006, these amounted to $174,775.09. These costs are supported by detailed timesheets. It is clear that the liquidation has been extremely time consuming and complex. I am satisfied as to the reasonableness of the remuneration claimed and approve the payment sought from assets available to the liquidator from which to make the payment. 59 As I have said, the liquidator is entitled to remuneration, not only from the company's property, but from the property of investors, which he has identified, preserved and which he may realise. He has an equitable lien to secure that entitlement. Any income the liquidator receives under the licence agreement with Nicholls Engineering Pty Ltd may be applied towards payment of the liquidator's costs. 60 The liquidator would also be justified in raising further voluntary levies to cover ongoing and future costs for making in specie distributions to claimants, and for costs incurred at the request of the claimants in selling machines on their behalf. If it is necessary for the liquidator to incur costs in securing, or storing, the machines following termination of the licence agreement with Nicholls Engineering Pty Ltd, assuming such an agreement is terminated, then the costs of doing so would also be covered by the liquidator's lien. [The liquidator addressed.] 61 The liquidator has raised a further question concerning the machines which were the subject of the buy-back arrangements. I have said that the liquidator is justified in proceeding on the basis that the company has title to those machines. It follows that, if those machines are sold, the proceeds of sale are available for distribution amongst unsecured creditors of the company. I see no reason for treating the class of unsecured creditors comprising investors with claims against the company, differently from other unsecured creditors who are not priority creditors under s 556(1) of the Corporations Act. Such investors' claims would not have priority over other unsecured debts and claims pursuant to s 556. ****** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.