New South Wales Supreme Court CITATION : Wajs v Active Optics Pty Ltd [2008] NSWSC 23 HEARING DATE(S) : 24 January 2008 JUDGMENT DATE : 24 January 2008 JURISDICTION : Equity JUDGMENT OF : Campbell JA EX TEMPORE JUDGMENT DATE : 24 January 2008 DECISION : Company wound up. Liquidator appointed. CATCHWORDS : CORPORATIONS – winding up – application for winding up on ground of insolvency – ground made out and undisputed – relevance of allegation of lack of impartiality on part of provisional liquidator – relevance of allegation of lack of consultation between liquidator and shareholder director – no evidence adduced in support of allegations – no application made for adjournment to put on evidence – relevance of claim that winding up application was an attempt to circumvent a shareholders' agreement – no application made for injunction to enforce shareholders' agreement – whether appropriate to make order for winding up in court vacation – costs PARTIES : Andrew Wajs - Plaintiff Active Optics Pty Ltd (Provisional Liquidator Appointed) - Defendant FILE NUMBER(S) : SC 4393/07 D Hogan-Doran - Plaintiff COUNSEL : P Cooper, solicitor - Provisional Liquidator P Mitchell, solicitor - for I Clapham Aitken Lawyers - Plaintiff SOLICITORS : TurksLegal - Provisional Liquidator Peter Mitchell Solicitors - for I Clapham IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION DUTY JUDGE LIST CAMPBELL JA 24 JANUARY 2008 4393/07 ANDREW WAJS v ACTIVE OPTICS PTY LTD JUDGMENT – Ex Tempore 1 HIS HONOUR: This is an application for the winding up of a company on the grounds of insolvency and on a just and equitable grant. 2 Justice Barrett appointed Mr Krejci as a provisional liquidator of the company on 15 October 2007. The company is in the business of licensing and selling certain software for digital camera and mobile phones with cameras. Its plan for the licensing and sale of software has encountered some difficulties. 3 There were four men involved in the company. Three of the men involved in the company accept that the company is insolvent, and should be wound up. The fourth, Mr Ian Clapham, has expressed various concerns. He has expressed concern about the expertise of the provisional liquidator to sell a specialised asset like intellectual property rights, and his impartiality. 4 He has on occasion suggested he should have the opportunity to put together some alternative plan to better realise the assets of the company in liquidation. 5 He has complained that on occasion there has been lack of consultation between him and the liquidator. He says he has made a considerable investment of time and money in the company. 6 He also says that, for various reasons, it is the fault of one of the other men involved in the company, Mr Andrew Wajs, that the company has encountered difficulties. 7 None of these matters, even if they are true, are matters that affect the basic matter that is established by the evidence before me, which is that the company is unable to pay its debt as they fall due. There is no evidence to bear out the claim of lack of impartiality of the provisional liquidator, no application for adjournment to put such evidence on, and no concrete proposal that a specific person other than Mr Krejci should become liquidator. 8 Another contention that Mr Clapham has raised in correspondence, and by his legal representative from the bar table today, is that the winding up application is an attempt to circumvent a shareholders' agreement. 9 The merits of that contention were not put to me, and there is no application for an injunction to enforce the provisions of the shareholders' agreement. 10 Mr Mitchell, appearing today for Mr Clapham, does not contest that the company is insolvent, though he points out that the extent of its present inability to pay its debts as they fall due is not great. 11 In those circumstances, it is appropriate for the company to be wound up on the ground of insolvency. 12 This matter came before me in the vacation, because it was contended that there was urgency in the appointment of a liquidator, because the asset of substance of the company consisted of various pieces of individual property relating to its software. A process is presently being gone through to obtain some international patent protection for that software. It was initially contended that there was urgency requiring the power of the liquidator to sell the software to be clarified, before the end of this month. The evidence does not bear out that claim for urgent treatment of the matter, but when a ground for winding up is made out and not disputed it seems to me that it would be simply a waste of time and money for the order not to be made today. 13 I order that Active Optics Pty Ltd be wound up. I appoint Peter Paul Krejci as liquidator of the company. 14 I order that Ian Clapham be joined as a defendant. I dispense with any service on him of the process, and note that he has been legally represented today and has already, on 17 January 2008, filed an affidavit in the proceedings. 15 I also make an order granting the plaintiff leave to make the winding up application. 16 I order that the costs of the application be paid from the assets of the company. 17 Notwithstanding that the application sought a winding up on a just and equitable ground, I did not hear the application on that basis today and the decision has not been made on that basis. ********** 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.