Toyota Finance Australia Ltd v Auskor Cultural Exchange Pty Ltd [2008] NSWSC 1026

New South Wales Supreme Court

CITATION : Toyota Finance Australia Ltd v Auskor Cultural Exchange Pty Ltd [2008] NSWSC 1026

HEARING DATE(S) : 29/09/08

JUDGMENT DATE : 29 September 2008

JURISDICTION : Equity Division Corporations List

JUDGMENT OF : Barrett J

EX TEMPORE JUDGMENT DATE : 29 September 2008

DECISION : Application adjourned

CATCHWORDS : CORPORATIONS - voluntary administration - application by liquidator for leave to appoint himself as administrator - application for order removing need for first meeting of creditors in consequent administration - where existing winding up is winding up by the court - first meeting in administration should be held unless it is clear creditors are content to forego opportunity to select another administrator

LEGISLATION CITED : Corporations Act 2001 (Cth), Part 5.3A, ss 436B(2), 447A

CATEGORY : Procedural and other rulings

CASES CITED : Re Cobar Mines Pty Ltd (1998) 30 ACSR 125

Toyota Finance Australia Limited - Plaintiff PARTIES : Auskor Cultural Exchange Pty Limited - Defendant Mitchell Ball - Applicant

FILE NUMBER(S) : SC 2529/08

COUNSEL : Mr D M Farrar, Solicitor - Applicant

SOLICITORS : Farrar Lawyers - Applicant

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

BARRETT J

MONDAY 29 SEPTEMBER 2008

2529/08 TOYOTA FINANCE AUSTRALIA LTD v AUSKOR CULTURAL EXCHANGE PTY LTD

JUDGMENT

1 The applicant is the liquidator of Auskor Cultural Exchange Pty Limited in respect of which a winding up order has been made by the court. The applicant seeks an order under s 436B(2) of the Corporations Act 2001 (Cth) granting him leave to appoint himself as administrator of the company. 2 On the materials before me, that order should be made. I say this in light of the fact that the applicant has given evidence that he is not aware of any conflict of duty or interest that would preclude him from taking up the position as voluntary administrator. That – and the more general issue of suitability to be administrator – is really the only question that arises on this kind of application: see Re Cobar Mines Pty Ltd (1998) 30 ACSR 125 and the later cases in which it has been applied. 3 There is also sought, however, an order pursuant to s 447A that the operation of Part 5.3A, as it applies in this case, be altered to abolish the requirement for a first meeting of creditors in the voluntary administration and to change the period for the convening of what would normally be the second meeting of creditors in that administration. 4 That order is commonly made in cases where the liquidator seeking leave to appoint himself or herself as administrator is liquidator under the form of creditors' voluntary winding up that follows on from voluntary administration. In such a case a first meeting of creditors has already been held in the prior administration and it is, in the absence of indications to the contrary, reasonable to think that to have another such meeting will entail unnecessary duplication. 5 In this case, however, where the winding up is a winding up ordered by the court, there has been no first meeting and therefore no forum within which creditors have had an opportunity to pronounce upon the question whether the initially appointed administrator should or should not continue as administrator. I do not think that that opportunity should be abolished in a case such as the present, unless the court has material before it upon which it is satisfied that the creditors are content that, in the voluntary administration, the person who was liquidator should continue as administrator. 6 Because there are only a few creditors in this case, the most efficient course is probably for the applicant to obtain positive indications from them to that effect, assuming that they are willing to give them. 7 On that basis I will stand the matter over so that this can be attended to. 8 The interlocutory process is stood over to 9.30am on 1 October 2008 before me. In the absence of any indication to the contrary at that point, I will make the orders sought.